[Title 48 CFR ]
[Code of Federal Regulations (annual edition) - October 1, 1997 Edition]
[From the U.S. Government Publishing Office]


[[Page 1]]

          48



          Federal Acquisition Regulations System



          CHAPTERS 3 TO 6

                         Revised as of October 1, 1997

          CONTAINING
          A CODIFICATION OF DOCUMENTS
          OF GENERAL APPLICABILITY
          AND FUTURE EFFECT
          AS OF OCTOBER 1, 1997

          With Ancillaries
          Published by
          the Office of the Federal Register
          National Archives and Records
          Administration
          as a Special Edition of
          the Federal Register



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                     U.S. GOVERNMENT PRINTING OFFICE
                            WASHINGTON : 1997



               For sale by U.S. Government Printing Office
 Superintendent of Documents, Mail Stop: SSOP, Washington, DC 20402-9328



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                            Table of Contents



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

  Title 48:
    Chapter 3--Department of Health and Human Services........       3
    Chapter 4--Department of Agriculture......................     225
    Chapter 5--General Services Administration................     289
    Chapter 6--Department of State............................     491
  Finding Aids:
    Table of CFR Titles and Chapters..........................     575
    Alphabetical List of Agencies Appearing in the CFR........     591
    List of CFR Sections Affected.............................     601



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

   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, 1997), 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 
number of the Federal Register and date of publication. Publication 
dates and effective dates are usually not the same and care must be 
exercised by the user in determining the actual effective date. In 
instances where the effective date is beyond the cut-off date for the 
Code a note has been inserted to reflect the future effective date. In 
those instances where a regulation published in the Federal Register 
states a date certain for expiration, an appropriate note will be 
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 
Affected'' is published at the end of each CFR volume.

CFR INDEXES AND TABULAR GUIDES

    A subject index to the Code of Federal Regulations is contained in a 
separate volume, revised annually as of January 1, entitled CFR Index 
and Finding Aids. This volume contains the Parallel Table of Statutory 
Authorities and Agency Rules (Table I), and Acts Requiring Publication 
in the Federal Register (Table II). A list of CFR titles, chapters, and 
parts and an alphabetical list of agencies publishing in the CFR are 
also included in this volume.
    An index to the text of ``Title 3--The President'' is carried within 
that volume.
    The Federal Register Index is issued monthly in cumulative form. 
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.

REPUBLICATION OF MATERIAL

    There are no restrictions on the republication of material appearing 
in the Code of Federal Regulations.

INQUIRIES

    For a legal interpretation or explanation of any regulation in this 
volume, contact the issuing agency. The issuing agency's name appears at 
the top of odd-numbered pages.
    For inquiries concerning CFR reference assistance, call 202-523-5227 
or write to the Director, Office of the Federal Register, National 
Archives and Records Administration, Washington, DC 20408.

SALES

    The Government Printing Office (GPO) processes all sales and 
distribution of the CFR. For payment by credit card, call 202-512-1800, 
M-F 8 a.m. to 4 p.m. e.s.t. or fax your order to 202-512-2233, 24 hours 
a day. For payment by check, write to the Superintendent of Documents, 
Attn: New Orders, P.O. Box 371954, Pittsburgh, PA 15250-7954. For GPO 
Customer Service call 202-512-1803.

                              Raymond A. Mosley,
                                    Director,
                          Office of the Federal Register.

October 1, 1997.



[[Page vii]]



                               THIS TITLE

    Title 48--Federal Acquisition Regulations System is composed of 
eight 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 251 and parts 252 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, 1997.

    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 two volumes containing chapter 1 include an index to the Federal 
acquisition regulations. The second volume, containing chapter 1 (parts 
52 to 99), includes contract clauses and forms.

    For this volume, Ann E. Maso was Chief Editor. The Code of Federal 
Regulations publication program is under the direction of Frances D. 
McDonald, assisted by Alomha S. Morris.

[[Page viii]]




[[Page 5]]



                          SUBCHAPTER A--GENERAL





PART 301--HHS ACQUISITION REGULATION SYSTEM--Table of Contents




               Subpart 301.1--Purpose, Authority, Issuance

Sec.
301.101  Purpose.
301.102  Authority.
301.103  Applicability.
301.104  Issuance.
301.104-1  Publication and code arrangement.
301.104-2  Arrangement of regulations.
301.104-3  Copies.
301.105  OMB approval under the Paperwork Reduction Act.

                      Subpart 301.2--Administration

301.201  Maintenance of the HHSAR.
301.270  Executive Committee for Acquisition.
301.271  Timing of HHSAR revisions.

              Subpart 301.3--Agency Acquisition Regulations

301.301  Policy.
301.302  Limitations.
301.303  Publication and codification.
301.304  Agency control and compliance procedures.

                 Subpart 301.4--Deviations From the FAR

301.403  Individual deviations.
301.404  Class deviations.
301.470  Procedure.

             Subpart 301.5--Agency and Public Participation

301.501  Solicitation of agency and public views.
301.501-2  Opportunity for public comments.
301.501-3  Exceptions.
301.503  Public meetings.

         Subpart 301.6--Contracting Authority and Responsibility

301.602-3  Ratification of unauthorized commitments.
301.603  Selection, appointment, and termination of appointment.
301.603-1  General.
301.603-2  Selection.
301.603-3  Appointment.
301.603-4  Termination.
301.603-70  Delegation of contracting officer responsibilities.
301.670  Head of the contracting activity.
301.670-1  Responsibility.
301.670-2  Designation.
301.670-3  Redelegation.

               Subpart 301.7--Determinations and Findings

301.703  Class determinations and findings.
301.704  Content.

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

    Source:  49 FR 13961, Apr. 9, 1984, unless otherwise noted.



               Subpart 301.1--Purpose, Authority, Issuance



301.101  Purpose.

    (a) The Department of Health and Human Services Acquisition 
Regulation (HHSAR) is issued to establish uniform acquisition policies 
and procedures for the Department of Health and Human Services (HHS) 
which conform to the Federal Acquisition Regulation (FAR) System.
    (b) The HHSAR implements and supplements the FAR. (Implementing 
material expands upon or indicates the manner of compliance with related 
FAR material. Supplementing material is new material which has no 
counterpart in the FAR.)
    (c) The HHSAR contains all formal departmental policies and 
procedures that govern the acquisition process or otherwise control 
contracting relationships between the Department's contracting offices 
and contractors.



301.102  Authority.

    The HHSAR is prescribed by the Assistant Secretary for Management 
and Budget under the authority of 5 U.S.C. 301 and section 205(c) of the 
Federal Property and Administrative Services Act of 1949, as amended (40 
U.S.C. 486(c)), as delegated by the Secretary. The Assistant Secretary 
for Management and Budget has redelegated the authority to establish all 
departmental acquisition policy and publish all acquisition regulations 
to the Deputy Assistant Secretary for Management and

[[Page 6]]

Acquisition. This authority is not redelegable.
[49 FR 13961, Apr. 9, 1984, as amended at 54 FR 24342, June 7, 1989]



301.103  Applicability.

    The FAR and HHSAR apply to all HHS acquisitions as stated in FAR 
1.103. Unless specified otherwise, these regulations apply to 
acquisitions within and outside the United States.



301.104  Issuance.



301.104-1  Publication and code arrangement.

    (a) The HHSAR is also published in the same forms as indicated in 
FAR 1.104-1(a).
    (b) The HHSAR is issued in the Code of Federal Regulations (CFR) as 
Chapter 3 of Title 48, Department of Health and Human Services 
Acquisition Regulation. It may be referenced as ``48 CFR Chapter 3.''



301.104-2  Arrangement of regulations.

    (a) General. The HHSAR conforms to the FAR with respect to 
divisional arrangements; i.e., subchapters, parts, subparts, sections, 
subsections, and paragraphs.
    (b) Numbering. The FAR System of numbering permits the keying of the 
same or similar subject matter throughout Chapters 1 (FAR) and 3 
(HHSAR). However, unlike the FAR numbering scheme, our scheme varies 
somewhat in the numbering to the left of the decimal point. Whereas the 
FAR only identifies the part number to the left of the decimal point, 
our corresponding reference identifies the chapter as well. For example, 
this corresponding paragraph in the FAR is numbered 1.104-2(b) where 
``1'' is the part number (may be one or two digits and is followed by a 
decimal point), ``1'' (to the right of the decimal point) is the subpart 
number, ``04'' (always two digits) is the section number, ``2'' is the 
subsection number (always hyphenated), and ``(b)'' is the paragraph 
reference. The corresponding HHSAR reference is 301.104-2(b) where the 
``3'' or first digit is the chapter number assigned to the particular 
department or agency (may be two digits) and the ``01'' represents the 
part number (part numbers will always be two digits for agencies 
implementing the FAR). The remaining numbers are identical to and 
represent the same divisions as the FAR example.
    (c) References and citations. (1) Unless otherwise stated, 
references, indicate parts, subparts, sections, subsections, etc, of 
this regulation, the HHSAR.
    (2) This regulation shall be referred to as the Department of Health 
and Human Services Acquisition Regulation (HHSAR). Any reference may be 
cited as ``HHSAR'' followed by the appropriate number. Within the HHSAR, 
the number alone will be used.
    (3) Citations of authority shall be incorporated where necessary. 
All FAR reference numbers shall be preceded by ``FAR''.



301.104-3  Copies.

    Copies of the HHSAR in Federal Register and CFR form may be 
purchased by the public from the Superintendent of Documents, Government 
Printing Office (GPO), Washington, DC 20402. Lose-leaf copies of the 
HHSAR may be obtained by departmental personnel having a need for the 
document by placing an order with a Directives Distribution Coordinator 
in accordance with General Administration Manual Chapter 1-00, HHS Staff 
Manual System.



301.105  OMB approval under the Paperwork Reduction Act.

    The following OMB control numbers apply to the information 
collection and recordkeeping requirements contained in this regulation:

                                                                        
------------------------------------------------------------------------
                                                             OMB control
                       HHSAR segment                             no.    
------------------------------------------------------------------------
315.4......................................................    0990-0139
324.70.....................................................    0990-0136
332.406....................................................    0990-0134
342.7103...................................................    0990-0131
352.215-71.................................................    0990-0139
352.216-70.................................................    0990-0138
352.224-70.................................................    0990-0136
352.228-70.................................................    0990-0135
352.232-71.................................................    0990-0134
352.232-73.................................................    0990-0134
352.233-70.................................................    0990-0133
352.270-1..................................................    0990-0129
352.270-2..................................................    0990-0129
352.270-3..................................................    0990-0129
352.270-5..................................................    0990-0130
370.1......................................................    0990-0129
370.2......................................................    0990-0129

[[Page 7]]

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


The OMB control number ``OMB No. 0990-0115'' is to be included in the 
upper right corner of the first page of all solicitations, purchase 
orders, and contracts issued by departmental contracting activities. The 
number represents approval of the HHS acquisition process and covers 
recordkeeping and reporting requirements which are unique to individual 
acquisitions (e.g., requirements contained in specifications, statements 
of work, etc.).
[49 FR 13961, Apr. 9, 1984, as amended at 50 FR 23126, May 31, 1985; 50 
FR 38004, Sept. 19, 1985; 51 FR 44293, Dec. 9, 1986; 53 FR 15562, May 2, 
1988]



                      Subpart 301.2--Administration



301.201  Maintenance of the HHSAR.

    (a) The HHSAR is prepared and issued under the authority of the 
Deputy Assistant Secretary for Management and Acquisition. Acquisition 
policies and procedures which are necessary to implement, supplement, or 
deviate from the FAR will be issued in the HHSAR by the Deputy Assistant 
Secretary for Management and Acquisition when necessary to accomplish 
Department-wide acquisition objectives.
    (b) The HHSAR is maintained by the Office of Acquisition and Grants 
Management. The Director, Office of Acquisition and Grants Management is 
responsible for developing and preparing for issuance all acquisition 
regulatory material to be included in the HHSAR.
[49 FR 13961, Apr. 9, 1984, as amended at 50 FR 23126, May 31, 1985; 50 
FR 38004, Sept. 19, 1985; 54 FR 24342, June 7, 1989]



301.270  Executive Committee for Acquisition.

    (a) The Deputy Assistant Secretary for Management and Acquisition 
has established the Executive Committee for Acquisition (ECA) to assist 
and facilitate the planning and development of departmental acquisition 
policies and procedures and to assist in responding to other agencies 
and organizations concerning policies and procedures impacting the 
Federal acquisition process.
    (b) The ECA consists of members and alternates from the Office of 
Acquisition and Grants Management, Division of Contract Operations-OS, 
Office of Human Development Services, Health Care Financing 
Administration, Social Security Administration, Public Health Service, 
and, collectively, the regional offices. The ECA is chaired by the 
Director, Office of Acquisition and Grants Management. All meetings will 
be held at the call of the Chairman, and all activities will be carried 
out under the direction of the Chairman.
    (c) The ECA, to facilitate the planning, development, and 
coordination of government-wide and department-wide acquisition policies 
and procedures, is to:
    (1) Advise and assist the Chairman concerning major acquisition 
policy matters;
    (2) Review and appraise, at appropriate intervals, the overall 
effectiveness of existing policies and procedures; and
    (3) Review and appraise the impact of new major acquisition 
policies, procedures, regulations, and developments on current 
acquisition policies and procedures.
    (d) The Chairman will periodically issue a list of current members 
and alternates specifying the name, title, organization, address, and 
telephone number of each. The member organizations are responsible for 
apprising the Chairman whenever a new member or alternate is to be 
appointed to the ECA.
[49 FR 13961, Apr. 9, 1984, as amended at 50 FR 23126, May 31, 1985; 50 
FR 38004, Sept. 19, 1985; 54 FR 24342, June 7, 1989]



301.271  Timing of HHSAR revisions.

    HHSAR revisions will be issued throughout the year as the need 
arises. HHSAR material shall become effective on the date cited in the 
Federal Register issuance or on the date of the transmittal notice which 
distributes it to HHSAR Staff Manual holders, unless otherwise 
indicated.



              Subpart 301.3--Agency Acquisition Regulations



301.301  Policy.

    (a)(1) The FAR and HHSAR are intended to provide all necessary 
regulatory guidance for the conduct of the

[[Page 8]]

acquisition process within the Department. However, there may be some 
rare instances where regulations are necessary to implement and/or 
supplement the FAR and/or HHSAR at the Operating Division (OPDIV) level 
or lower. The Department discourages the proliferation of OPDIV and 
lower level issuances, but will allow lower level issuances when deemed 
pertinent.
[49 FR 13961, Apr. 9, 1984, as amended at 50 FR 23126, May 31, 1985; 50 
FR 38004, Sept. 19, 1985]



301.302  Limitations.

    The same limitations applicable to the FAR also apply to the HHSAR.



301.303  Publication and codification.

    (a) The HHSAR shall be codified in Chapter 3 of Title 48, Code of 
Federal Regulations. Any OPDIV or lower implementation or 
supplementation of the HHSAR or FAR shall also be codified as part of 
Chapter 3. Implementing material is that which expands upon or indicates 
the manner of compliance with related higher level material. 
Supplementing material is that for which there is no counterpart. Where 
material in the FAR requires no implementation, there will be no 
corresponding number in the HHSAR. Thus, there are gaps in the HHSAR 
sequence of numbers where the FAR, as written, is deemed adequate. 
Supplementary material shall be numbered as specified in FAR 1.303.
[49 FR 13961, Apr. 9, 1984, as amended at 50 FR 23126, May 31, 1985; 50 
FR 38004, Sept. 19, 1985]



301.304  Agency control and compliance procedures.

    (a) Whenever an OPDIV or lower level organization determines a need 
for an acquisition regulation not covered by the FAR or HHSAR or wishes 
to implement or supplement the coverage in either, the organization 
shall prepare a memorandum that explains the need, background, 
justification, and significant aspects of the proposed regulation and 
send it, together with an outline, to the Director, Office of 
Acquisition and Grants Management. The Director will analyze the request 
to determine if it has applicability to the HHSAR or FAR; if not, the 
Director will either approve or disapprove the request for incorporation 
into the organization's acquisition regulation. If the request is 
approved, the organization must prepare the proposed regulation in 
Federal Register format, obtain all necessary concurrences, including 
Office of General Counsel--Business and Administrative Law Division, and 
send it to the Director, Office of Acquisition and Grants Management for 
review and approval. The regulation must be prepared for signature by 
the Deputy Assistant Secretary for Management and Acquisition. All 
regulations will be required to be processed through the public 
rulemaking process in the Federal Register.
    (b) Only the organizations listed in paragraph (d) are authorized to 
established acquisition regulations. As of the date of issuance of the 
HHSAR, no acquisition regulations below the HHSAR level exist, and the 
procedures detailed in paragraph (a) must be followed to initiate the 
establishment of an OPDIV or lower level regulation.
    (c) Under no circumstances shall any organization's implementation 
or supplementation of the FAR or HHSAR conflict with, supersede, or 
repeat, paraphrase, or otherwise restate policies or procedures 
prescribed by these regulatory issuances. OPDIV or lower level material 
shall follow the numbering system, format, and arrangement of the FAR 
and HHSAR and will be applicable only within the organization issuing 
it. One copy of all OPDIV or lower level material issued in loose-leaf 
format shall be furnished the Director, Office of Acquisition and Grants 
Management at the times of issuance.
    (d) Material issued by OPDIV or lower level organizations to 
implement and supplement the HHSAR and FAR shall be identified by 
prefixes to the digit 3 (indicating Chapter 3-HHSAR) as follows, and 
shall use the same numbering system as the HHSAR:

                                                                        
------------------------------------------------------------------------
                Organization                            Prefix          
------------------------------------------------------------------------
Office of the Secretary....................  OS                         
Health Care Financing Administration.......  HCFA                       
Office of Human Development Services.......  OHDS                       
Public Health Service......................  PHS                        
  Alcohol, Drug Abuse, and Mental Health     ADAMHA                     
   Administration.                                                      
  Centers for Disease Control..............  CDC                        
  Food and Drug Administration.............  FDA                        

[[Page 9]]

                                                                        
  Health Resources and Services              HRSA                       
   Administration.                                                      
  Indian Health Service....................  IHS                        
  National Institutes of Health............  NIH                        
Social Security Administration.............  SSA                        
------------------------------------------------------------------------


Each OPDIV or lower level acquisition regulation will be included in its 
entirety as a separate appendix to 48 CFR Chapter 3. The Director, 
Office of Acquisition and Grants Management will assign the appendix 
designation upon approval of the initial request to establish the OPDIV 
or lower level acquisition regulation.
[49 FR 13961, Apr. 9, 1984, as amended at 49 FR 36110, Sept. 14, 1984; 
50 FR 23126, May 31, 1985; 50 FR 38004, Sept. 19, 1985; 53 FR 43206, 
Oct. 26, 1988, 54 FR 24342, June 7, 1989]



                 Subpart 301.4--Deviations From the FAR



301.403  Individual deviations.

    Requests for individual deviations to either the FAR or HHSAR shall 
be prepared in accordance with 301.470 and forwarded through 
administrative channels to the Director, Office of Acquisition and 
Grants Management for review and approval.
[49 FR 13961, Apr. 9, 1984, as amended at 50 FR 23126, May 31, 1985; 50 
FR 38004, Sept. 19, 1985; 54 FR 24342, June 7, 1989]



301.404  Class deviations.

    Requests for class deviations to either the FAR or HHSAR shall be 
prepared in accordance with 301.470 and forwarded through administrative 
channels to the Deputy Assistant Secretary for Management and 
Acquisition for review and approval.
[49 FR 13961, Apr. 9, 1984, as amended at 50 FR 23126, May 31, 1985; 50 
FR 38004, Sept. 19, 1985; 54 FR 24342, June 7, 1989]



301.470  Procedure.

    (a) When a contracting activity or contracting office determines 
that a deviation is needed, it shall prepare a deviation request in 
memorandum form and forward it through administrative channels to the 
official designated as stated in 301.403 or 301.404. In an exigency 
situation, the contracting activity or contracting office may request a 
deviation verbally, but is required to confirm the request in writing as 
soon as possible.
    (b) A deviation request shall clearly and precisely set forth the:
    (1) Nature of the needed deviation;
    (2) Identification of the FAR or HHSAR from which the deviation is 
needed;
    (3) Circumstances under which the deviation would be used;
    (4) Intended effect of the deviation;
    (5) Time-frame; and
    (6) Reasons which will contribute to complete understanding and 
support of the requested deviation. A copy of pertinent background 
papers such as a form or contractor's request should accompany the 
deviation request.
[49 FR 13961, Apr. 9, 1984, as amended at 50 FR 23126, May 31, 1985; 50 
FR 38004, Sept. 19, 1985; 54 FR 24342, June 7, 1989]



             Subpart 301.5--Agency and Public Participation



301.501  Solicitation of agency and public views.

[49 FR 13961, Apr. 9, 1984, as amended at 50 FR 23126, May 31, 1985; 50 
FR 38004, Sept. 19, 1985]



301.501-2  Opportunity for public comments.

    (b) Public opportunity for comment on proposed changes or additions 
to the HHSAR or lower level acquisition regulations will be offered 
whenever the proposed regulation will have an impact on the public and/
or contractors. This will be accomplished by publishing a notice of 
proposed rulemaking in the Federal Register which will include the 
proposed language and the background and rationale for the proposed 
regulation. Comments will not be solicited directly from professional or 
industry associations or other interested parties; they will be expected 
to respond based upon the Federal Register notification. Normally, the 
public will be given 45 days to comment. Proposed changes or additions 
to the HHSAR or FAR shall be staffed to the

[[Page 10]]

Executive Committee for Acquisition in accordance with 301.270.
[49 FR 13961, Apr. 9, 1984. Redesignated and amended at 50 FR 23126, May 
31, 1985; 50 FR 38004, Sept. 19, 1985]



301.501-3  Exceptions.

    (e) Comments will not be solicited from the public when the change 
or addition to the HHSAR or lower level acquisition regulation is deemed 
procedural in nature and concerns internal administrative directions 
aimed at departmental personnel (see FAR 1.301(b)).
[49 FR 13961, Apr. 9, 1984, as amended at 49 FR 36110, Sept. 14, 1984. 
Redesignated and amended at 50 FR 23126, May 31, 1985; 50 FR 38004, 
Sept. 19, 1985]



301.503  Public meetings.

    Public meetings will not normally be used to solicit comments or 
views on HHSAR or lower level acquisition regulations. However, when the 
topic is so controversial that the Department or OPDIV believes a public 
meeting would be beneficial, public meetings will be convened.
[49 FR 13961, Apr. 9, 1984. Redesignated at 50 FR 23127, May 31, 1985; 
50 FR 38004, Sept. 19, 1985]



         Subpart 301.6--Contracting Authority and Responsibility

    Source:  53 FR 15562, May 2, 1988, unless otherwise noted.



301.602-3  Ratification of unauthorized commitments.

    (b) Policy. (1) The Government is not bound by agreements or 
contractual commitments made to prospective contractors by persons to 
whom contracting authority has not been delegated. However, execution of 
otherwise proper contracts made by individuals without contracting 
authority, or by contracting officers in excess of the limits of their 
delegated authority, may be later ratified. The ratification must be in 
the form of a written document clearly stating that ratification of a 
previously unauthorized act is intended and must be signed by the head 
of the contracting activity (HCA).
    (2) The HCA or his/her designee is the official authorized to ratify 
an unauthorized commitment (but see (b)(3), below).
    (3) Ratification authority may be redelegated by the HCA, but not 
below the level of the principal official responsible for acquisition 
(PORA).
    (c) Limitations. (5) The concurrence of legal counsel concerning the 
payment issue is optional.
    (7) The ratification shall be in written document form containing 
verification of each limitation stated in FAR 1.602-3(c)(1)-(6), and 
shall be processed in accordance with 301.602-3(e) Procedures.
    (e) Procedures. (1) The individual who made the unauthorized 
contractual commitment shall furnish the reviewing contracting officer 
all records and documents concerning the commitment and a complete 
written statement of facts, including, but not limited to: a statement 
as to why the contracting office was not used, a statement as to why the 
proposed contractor was selected, a list of other sources considered, a 
description of work to be performed or products to be furnished, the 
estimated or agreed contract price, a citation of the appropriation 
available, and a statement of whether the contractor has commenced 
performance.
    (2) The contracting officer will review the submitted material, and 
prepare the ratification document if he/she determines that the 
commitment may be ratifiable. The contracting officer shall forward the 
ratification document and the submitted material to the HCA or designee 
with any comments or information which should be considered in 
evaluation of the request for ratification. If legal review is 
desirable, the HCA or designee will coordinate the request for 
ratification with the Office of General Counsel, Business and 
Administrative Law Division.
    (3) If ratification is authorized by the HCA or designee, the file 
will be returned, along with the ratification document, to the 
contracting officer for issuance of a purchase order or contract, as 
appropriate.
    (4) HCA's or their designees will report the number and dollar value 
of requests for ratifications received and

[[Page 11]]

ratifications authorized each calendar quarter. Reports shall be 
submitted in an original and one copy to the Deputy Assistant Secretary 
for Management and Acquisition to arrive no later than 30 calendar days 
after the close of each calendar quarter.
[53 FR 43206, Oct. 26, 1988]



301.603  Selection, appointment, and termination of appointment.



301.603-1  General.

    (a) The appointment and termination of appointment of contracting 
officers shall be made by the principal official responsible for 
acquisition (PORA). This authority is not delegable. The head of the 
contracting activity shall ensure that only the PORA is redelegated, and 
exercises, this authority.
    (b) Only GS-1105 and 1106 and GS/GM-1101 and 1102 personnel shall be 
appointed as contracting officers (see 301.603-3(b)).
    (c) The appointment of contracting officers shall be made at one of 
the four levels specified under the HHS Acquisition Certification 
Program (see 301.603-3(b)).
    (d) An individual shall be appointed only in instances where a valid 
organizational need for a contracting officer can be demonstrated or a 
replacement position is to be filled. Factors to be considered in 
assessing the need for a contracting officer appointment include volume 
of actions, complexity of work, and structure of the organization.



301.603-2  Selection.

    (a) When an organizational need for a contracting officer is 
determined or a replacement is required, an official (usually the 
prospective contracting officer's immediate supervisor) will nominate a 
contracting officer candidate. The nomination shall be accompanied by 
the candidate's current Standard Form (SF) 171, Personal Qualifications 
Statement, that contains all relevant information, to include that 
stated in FAR 1.603-2, a copy of the nominee's most recent performance 
appraisal, and a copy of the certificate issued under the HHS 
Acquisition Certification Program indicating the current level of 
certification.
    (b) The PORA shall review the submitted material to determine the 
candidate's ability to perform the contracting functions required to 
meet the organizational need. If the PORA requires additional 
information to make the decision, it shall be provided expeditiously by 
the nominating official.



301.603-3  Appointment.

    (a) Contracting officer appointments shall become effective when the 
PORA signs the Standard Form 1402, Certificate of Appointment. SF 1402's 
shall be prepared and maintained in accordance with FAR 1.603-3.
    (b) Appointments shall be made at one of the four levels established 
by the HHS Acquisition Certification Program. Therefore, the contracting 
officer candidate must meet the minimum eligibility requirements of 
certification for one of the four stated levels. The level will be 
determined by the organizational need or position being refilled 
(replacement). The four levels are as follows:
    (1) Level I--Purchasing Agent. Mandatory for all personnel who have 
signature authority for small purchases (GS-1102, 1105, and 1106), 
including orders from GSA sources.
    (2) Level II--Acquisition Official. Mandatory for those in the GS-
1102 series. Sufficient for delegation of contracting officer authority 
to a maximum of $100,000.
    (3) Level III--Senior Acquisition Official. Mandatory for those in 
the GS-1102 series for delegation of contracting officer authority above 
$100,000.
    (4) Level IV--Acquisition Manager. Mandatory for preaward review and 
approval authority as specified in HHSAR Subpart 304.71.
    (c) Changes to contracting officer appointments, either increasing 
or decreasing the warrant limitations, shall be made by the PORA. 
Changes must be made from one of the four certification levels to 
another, or within one of the certification levels, and must be 
implemented by the PORA's issuance of a new SF 1402 to replace the 
existing SF 1402.
    (d) Personnel shall not ordinarily be appointed as contracting 
officers if they do not meet the qualifications

[[Page 12]]

prescribed for one of the four certification levels. However, if it is 
essential to appoint a contracting officer who does not fully meet the 
certification qualifications, an interim appointment may be granted by 
the PORA. The PORA shall require as a condition of the interim 
appointment that all training or experience requirements be met within a 
six month time period. Usually, interim appointments shall not exceed 
six months. Failure to successfully complete the necessary training 
requirements or gain the experience within this time frame will result 
in termination of the appointment, unless the PORA determines that 
unusual circumstances prevented the attainment of either. In this 
instance, one additional six month interim appointment may be issued, 
but no more shall be allowed. The PORA shall fully document all interim 
appointment actions.
    (e) The original SF 1402 shall be provided to the contracting 
officer, and a copy shall be retained by the PORA. Another copy of the 
SF 1402 along with the SF 171 material shall be forwarded to the 
servicing personnel office for inclusion in the individual's personnel 
file folder. Files on individuals should not be established by the PORA.



301.603-4  Termination.

    Termination of contracting officer appointments shall be executed by 
the PORA in accordance with FAR 1.603-4.



301.603-70  Delegation of contracting officer responsibilities.

    (a) Non-GS/GM-1101 or 1102 or GS-1105 or 1106 personnel shall only 
be delegated contracting officer responsibilities when determined 
necessary by a warranted contracting officer (holder of a valid SF 
1402), and in accordance with this subsection. Personnel, such as a 
contracting officer's representative or an ordering officer, shall be 
delegated only the needed responsibilities by the warranted contracting 
officer in a written memorandum of delegation which clearly states any 
limitations on the delegation. Personnel who are not in the GS/GM-1101 
or 1102 or GS-1105 or 1106 job series shall not be issued a SF 1402, 
Certificate of Appointment.
    (b) Non-acquisition personnel who are delegated acquisition 
responsibilities shall be required to have the training, experience, and 
education requirements necessary for the responsibilities assigned. If, 
for example, responsibility is to be delegated for making small 
purchases, the training, education, and experience for Level I--
Purchasing Agent, or its equivalent as determined by the PORA, shall be 
required.



301.670  Head of the contracting activity.



301.670-1  Responsibility.

    The head of the contracting activity (HCA) is responsible for 
conducting an effective and efficient acquisition program. Adequate 
controls shall be established to assure compliance with applicable laws, 
regulations, procedures, and the dictates of good management practices. 
Periodic reviews shall be conducted by qualified personnel, preferably 
assigned to positions other than in the contracting office being 
reviewed, to determine the extent of adherence to prescribed policies 
and regulations, and to detect a need for guidance and/or training.



301.670-2  Designation.

    Each OPDIV head and PHS agency head has been designated as HCA along 
with the following officials:
    (a) Deputy Assistant Secretary for Management and Acquisition; and
    (b) Each Regional Director.
[53 FR 15562, May 2, 1988, as amended at 54 FR 24342, June 7, 1989]



301.670-3  Redelegation.

    (a) The heads of contracting activities may redelegate their HCA 
authorities to the extent that redelegation is not prohibited by the 
terms of their respective delegations of authority, by law, by the 
Federal Acquisition Regulation, by the HHS Acquisition Regulation, or by 
other regulations. However, HCA and other contracting approvals and 
authorities shall not be redelegated below the levels specified in the 
HHS Acquisition Regulation or, in the

[[Page 13]]

absence of coverage in the HHS Acquisition Regulation, the Federal 
Acquisition Regulation. To ensure proper control of redelegated 
acquisition authorities, HCA's shall maintain a file containing 
successive delegations of HCA authority through and including the 
contracting officer level.
    (b) Personnel delegated responsibility for acquisition functions 
must possess a level of experience, training, and ability commensurate 
with the complexity and magnitude of the acquisition actions involved.



               Subpart 301.7--Determinations and Findings

    Source:  50 FR 23127, May 31, 1985 (interim rule) and 50 FR 38004, 
Sept. 19, 1985 (final rule), unless otherwise noted.



301.703  Class determinations and findings.

    (b) All class determinations and findings (D&F's) shall be limited 
to a period of one year or less.



301.704  Content.

    An example of a D&F format may be found in 316.301-3(c). All D&F's 
shall be prepared using the referenced format and shall include the 
information required by FAR 1.704(a)-(g).



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




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



                       Subpart 302.1--Definitions



302.100  Definitions of terms.

    Chief of the contracting office (CCO) is a mid-level management 
official in charge of a contracting office who controls and oversees the 
daily contracting operation of an Operating Division (OPDIV) or major 
component of an OPDIV. The CCO is subordinate to the principal official 
responsible for acquisition and is located at a management level above 
other contracting personnel, usually as a branch chief.
    Head of the agency or agency head means the head of the Operating 
Division (OPDIV) for HCFA, OHDS, PHS, and SSA, or the Assistant 
Secretary for Management and Budget (ASMB) for the Office of the 
Secretary (OS).
    Head of the contracting activity (HCA)--see 301.670-2.
    Principal official responsible for acquisition (PORA) is defined in 
terms of certain organizational positions within the Office of 
Management and Acquisition (OMAC-OS), Health Care Financing 
Administration (HCFA), Office of Human Development Services (OHDS), 
Office of the Assistant Secretary for Health (OASH), Alcohol, Drug 
Abuse, and Mental Health Administration (ADAMHA), Centers for Disease 
Control (CDC), Food and Drug Administration (FDA), Health Resources and 
Services Administration (HRSA), Indian Health Service (IHS), National 
Institutes of Health (NIH), Social Security Administration (SSA), and 
the Regional Offices (RO's), as follows:

OMAC-OS--Director, Division of Contract Operations
HCFA--Director, Office of Acquisition and Grants, Office of Budget and 
Administration
OHDS-- Director, Grants and Contracts Management Division, Office of 
Management Services
OASH--Director, Division of Acquisitions Management, Administrative 
Services Center, Office of Management
ADAMHA-- Director, Division of Grants and Contracts Management, Office 
of the Administrator
CDC-- Director, Procurement and Grants Office, Office of the Center 
Director
FDA-- Director, Division of Contracts and Grants Management, Office of 
the Associate Commissioner for Management and Operations
HRSA-- Director, Division of Grants and Procurement Management, Office 
of Management
IHS-- Director, Division of Contracts and Grants Policy, Office of 
Administration and Management
NIH-- Director, Division of Contracts and Grants, Office of 
Administration
SSA-- Associate Commissioner, Office of Acquisition and Grants
RO's-- Director, Regional Administrative Support Center


The PORA is subordinate to the head of the contracting activity and is 
the official in charge of the major contracting operation activity 
within the

[[Page 14]]

OPDIV, agency, staff office, or regional office.
[49 FR 13964, Apr. 9, 1984, as amended at 51 FR 23231, June 26, 1986; 51 
FR 44293, Dec. 9, 1986; 52 FR 27558, July 22, 1987; 53 FR 43207, Oct. 
26, 1988; 54 FR 24342, June 7, 1989; 55 FR 13536, Apr. 11, 1990; 56 FR 
47002, Sept. 17, 1991]



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




                        Subpart 303.1--Safeguards

Sec.
303.101  Standards of conduct.
303.101-3  Agency regulations.
303.104  Procurement integrity.
303.104-4  Definitions.
303.104-5  Disclosure of proprietary and source selection information.
303.104-6  Restrictions on Government officials, employees, and 
          consultants.
303.104-9  Certification requirements.
303.104-11  Processing violations or possible violations.
303.104-12  Ethics program training requirements.

       Subpart 303.2--Contract Gratuities to Government Personnel

303.203  Reporting suspected violations of the Gratuities clause.

         Subpart 303.3--Report of Suspected Antitrust Violations

303.303  Reporting suspected antitrust violations.

                     Subpart 303.4--Contingent Fees

303.408  Evaluation of the SF 119.
303.408-1  Responsibilities.
303.409  Misrepresentations or violations of the Covenant Against 
          Contingent Fees.

            Subpart 303.5--Other Improper Business Practices

303.502  Subcontractor kickbacks.

  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:  49 FR 13964, Apr. 9, 1984, unless otherwise noted.



                        Subpart 303.1--Safeguards

    Source:  54 FR 31528, July 31, 1989, unless otherwise noted.



303.101  Standards of conduct.



303.101-3  Agency regulations.

    The Department of Health and Human Services' Standards of Conduct 
are prescribed in Part 73 of Title 45.



303.104  Procurement integrity.



303.104-4  Definitions.

    (h)(1) Procurement official means any individual who has 
participated personally and substantially in the conduct of a 
procurement. The following classes of employees may be considered 
procurement officials depending on the circumstances prevailing in a 
given case: contracting officers, contract specialists, contract 
administrators, procurement agents, procurement clerks, cost/price 
analysts, procurement analysts, clerical support and administrative 
personnel, auditors, professional staff of the Division of Cost 
Allocation, acquisition review and approval officials, contract 
clearance staff, board of award members, supervisory procurement 
officials, small and disadvantaged business utilization specialists, 
project officers, project managers, program officials, officials who 
provide special program clearances and approvals, program managers, 
technical evaluation panelists, peer reviewers, source selection 
evaluation board members, source selection advisory council members, 
source selection authorities, finance officials, and procurement 
lawyers. Concept peer reviewers are not considered to be procurement 
officials when participating in project concept reviews pursuant to 42 
CFR 52h.10(a). However, concept peer reviewers, or other peer reviewers, 
who participate in a project approach review are procurement officials. 
When there is a question whether an individual is a procurement 
official, the activities of the individual should be analyzed by the 
contracting officer to determine

[[Page 15]]

whether there is both personal and substantial involvement in a 
procurement. If there is doubt in a particular case, the doubt should be 
resolved by including the individual as a procurement official. The 
contracting officer has the authority to decide who is or who is not a 
procurement official in a particular case. The opinion of the Office of 
the General Counsel (OGC) should be requested when the contracting 
officer believes the situation is particularly complex or sensitive. 
When the contracting officer's decision is disputed by the individual 
whose status as a procurement official is in question, the matter will 
be referred to the Principal Official Responsible for Acquisition (PORA) 
for a final determination.
    (k)(1) Source selection information includes ``derivative 
documents'' which are documents containing references to or directly 
citing or paraphrasing proprietary or source selection information.



303.104-5  Disclosure of proprietary and source selection information.

    (a) The contracting officer or any other individual who prepares, 
makes or controls proprietary, source selection information, or 
derivative documents shall--
    (1) Ensure documents are marked as prescribed in FAR 3.104-4 (j) and 
(k);
    (2) Provide physical security for documents in the office 
environment during and after duty hours; and
    (3) Ensure security of interoffice mailing of documents by using 
opaque envelopes, double wrapping with more than one envelope, and 
sealing of envelopes, as necessary.
    (b) Individuals responsible for preparing derivative documents are 
responsible for marking such documents in accordance with FAR 3.104-
5(b).
    (c) Only the contracting officer has the authority to authorize 
individuals, or classes of individuals, access to proprietary or source 
selection information for each procurement except for paragraph (d) of 
this section.
    (d) The following classes of individuals are authorized blanket 
access to only that source selection information developed before a 
request for contract is sent to the contract office, or to later 
modifications or supplements to such information--
    (1) The generators of the requirements, including program, 
scientific, and technical experts involved in the development of the 
statements of work, specifications, evaluation plans, budget estimates, 
or similar documents;
    (2) Reviewing officials; and
    (3) Supervisors in the management chain of the individuals listed in 
paragraphs (d) (1) and (2) of this section. The contracting officer 
shall include in the contract file names and functions of any other 
individuals authorized access to proprietary or source selection 
information.



303.104-6  Restrictions on Government officials, employees, and consultants.

    (b) Procurement officials leaving the Department will be required to 
complete the certification set forth in Chapter 1-90 of the General 
Administration Manual if that official leaves the Department during the 
conduct of a procurement expected to result in a contract or 
modification in excess of $100,000. The administrative officer will 
forward a copy of the certification to each responsible contracting 
officer for incorporation into the contract file.



303.104-9  Certification requirements.

    (c) The contracting officer shall include the contracting officer 
certification in the contract file for each contract action over 
$100,000. Including the certificate in the contract file shall be 
considered notification to the head of the agency.
    (e)(2) The waiver shall be submitted to the Office of Acquisition 
and Grants Management in the Office of Management and Acquisition, 
Office of Management and Budget in the Office of the Secretary for 
review and approval before submission to the head of the agency.



303.104-11  Processing violations or possible violations.

    (a)(1) The contracting officer determination that a reported 
violation or possible violation of the statutory prohibitions has no 
impact on the impending award or selection of a source must

[[Page 16]]

be submitted through channels, along with supporting documentation, to 
the PORA for review and approval of the determination before award of a 
contract.
    (2) The contracting officer's determination that a reported 
violation or possible violation of the statutory prohibitions has an 
impact on the pending award or selection of a source must be referred 
through channels, along with all related information available, to the 
PORA (if the PORA is an SES) or to another SES official designated by 
the OPDIV. That individual will--
    (i) Refer the matter immediately to the Office of Acquisition and 
Grants Management in the Office of Management and Acquisition, Office of 
Management and Budget, Office of the Secretary for review, which office 
may consult with the Office of the General Counsel and the Office of the 
Inspector General, as appropriate; and
    (ii) Determine the action to be taken on the procurement in 
accordance with FAR 3.104-11 (c) and (d).
    (b) The individual in paragraph (a)(2) of this section acts as the 
agency head designee with respect to actions taken under the FAR clause 
at 52.203-10, Remedies for Illegal or Improper Activity.



303.104-12  Ethics program training requirements.

    (a) The Office of Acquisition and Grants Management in the Office of 
Management and Acquisition (OAGM), Office of Management and Budget in 
the Office of the Secretary is responsible for developing a training 
module which can be used by the Department's OPDIVs and Regional offices 
to train procurement officials. Upon receipt of the module, each OPDIV 
and Regional Office must train the procurement officials set forth in 
303.104-4(h)(1) before they can act as procurement officials.
    (b) After the training has been completed, each procurement official 
must sign the ``Procurement Official's Certificate of Procurement 
Integrity'' before he/she can act as a procurement official on any 
procurement. The certificate shall be submitted to the servicing 
personnel office, where the certificate will be filed on the left side 
of the employee's Official Personnel Folder. A copy of the certificate 
shall be provided to the contract office which shall maintain a list of 
the procurement officials who have signed the certificates.
    (c) Procurement officials who serve multiple contracting offices 
(such as procurement lawyers) shall submit copies of their certificates 
to OAGM with the originals being transmitted to their servicing 
personnel office. OAGM shall maintain a list of such procurement 
officials and inform cognizant contracting officers upon telephonic 
request whether particular individuals are included on the list.



      Subpart 303.2--Contractor Gratuities to Government Personnel



303.203  Reporting suspected violations of the Gratuities clause.

    Departmental personnel shall report suspected violations of the 
Gratuities clause in accordance with subpart M, Reporting Violations, of 
the Department's Standards of Conduct (45 CFR part 73) and General 
Administration Manual Chapter 5-10, rather than as specified in FAR 
3.203. Refer to subpart E, Gifts, Entertainment, and Favors, of 45 CFR 
part 73 for an explanation regarding what is prohibited and what is 
permitted.



         Subpart 303.3--Report of Suspected Antitrust Violations



303.303  Reporting suspected antitrust violations.

    A copy of each report of suspected antitrust violations submitted to 
the Attorney General shall also be submitted to the Director, Office of 
Acquisition and Grants Management.
[49 FR 13964, Apr. 9, 1984, as amended at 54 FR 24342, June 7, 1989]



                     Subpart 303.4--Contingent Fees



303.408  Evaluation of the SF 119.



303.408-1  Responsibilities.

    (b) The chief of the contracting office shall perform the review 
required by FAR 3.408-1(b) and should consult with the Office of General 
Counsel, Business

[[Page 17]]

and Administrative Law Division, when deemed necessary.



303.409  Misrepresentations or violations of the Covenant Against Contingent Fees.

    (a) Reports shall be made promptly to the contracting officer.
    (b)(1)-(3)  [Reserved]
    (4) Suspected fraudulent or criminal matters to be reported to the 
Department of Justice shall be prepared in letter format and forwarded 
through acquisition channels to the head of the contracting activity for 
signature. The letter must contain all pertinent facts and background 
information considered by the contracting officer and chief of the 
contracting office that led to the decision that fraudulent or criminal 
matters may be present. A copy of the signed letter shall be sent to the 
Director, Office of Acquisition and Grants Management.
[49 FR 13964, Apr. 9, 1984, as amended at 54 FR 24342, June 7, 1989]



            Subpart 303.5--Other Improper Business Practices



303.502  Subcontractor kickbacks.

    (b) Any known or suspected violations of the Anti-Kickback Act (41 
U.S.C. 51-54) shall be reported to the contracting officer who shall 
investigate the matter, document the findings, and report the results to 
the chief of the contracting office. If the results substantiate the 
known or suspected violation, the chief of the contracting office shall 
notify the Office of General Counsel, Business and Administrative Law 
Division and report the matter, through acquisition channels, to the 
head of the contracting activity. The head of the contracting activity 
shall take appropriate action is consonance with the Act, and notify the 
Director, Office of Acquisition and Grants Management of the case and 
its disposition.
[49 FR 13964, Apr. 9, 1984, as amended at 54 FR 24342, June 7, 1989]



  Subpart 303.6--Contracts With Government Employees or Organizations 
                       Owned or Controlled by Them



303.602  Exceptions.

    Approval of an exception to the policy stated in FAR 3.601 shall be 
made by the head of the OPDIV (Assistant Secretary for Management and 
Budget in OS cases) or the Regional Director.



             Subpart 303.7--Voiding and Rescinding Contracts



303.704  Policy.

    For the purposes of implementing FAR subpart 3.7, the authorities 
granted to the ``agency head or designee'' shall be exercised by the 
principal official responsible for acquisition.
[51 FR 44293, Dec. 9, 1986]



PART 304--ADMINISTRATIVE MATTERS--Table of Contents




                    Subpart 304.1--Contract Execution

Sec.
304.101  Contracting officer's signature.
304.170  [Reserved]

                  Subpart 304.2--Contract Distribution

304.201  Procedures.

                    Subpart 304.6--Contract Reporting

304.602  Federal Procurement Data System.

                      Subpart 304.8--Contract Files

304.801  General.
304.804  Closeout of contract files.
304.804-1  Closeout by the office administering the contract.
304.870  Closing review.

 Subpart 304.70--Acquisition Instrument Identification Numbering System

304.7000  Scope of subpart.
304.7001  Numbering contracts.
304.7002  Numbering solicitation documents.
304.7003  Numbering purchase and delivery orders.
304.7004  Numbering basic agreements.

[[Page 18]]

304.7005  Numbering basic ordering agreements.

     Subpart 304.71--Review and Approval of Proposed Contract Awards

304.7100  Scope of subpart.
304.7101  Contracts requiring review and approval.
304.7102  Conduct of the review.
304.7103  Approvals.

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

    Source:  49 FR 13965, Apr. 9, 1984, unless otherwise noted.



                    Subpart 304.1--Contract Execution



304.101  Contracting officer's signature.

    An original of each bilateral contract or modification shall be 
executed by the contractor and contracting officer. An original of each 
unilateral contract or modification shall be executed by the contracting 
officer. The contracting officer need only sign the original when carbon 
paper is used in sets of forms such as Standard Form 44 or Optional Form 
347 or 348. A legible carbon impression of the contracting officer's 
signature shall carry the same force and effect as a pen and ink 
signature for unilateral contracts.



Sec. 304.170  [Reserved]



                  Subpart 304.2--Contract Distribution



304.201  Procedures.

    The signed original of bilateral contracts and modifications shall 
be placed in the contract file, and duplicate originals shall be 
furnished the contractor, the appropriate accounting point, the project 
officer, and other individuals or offices, as applicable. Purchase 
orders, delivery orders, and other unilateral contracts and 
modifications shall be distributed the same as bilateral contracts 
except the original shall be furnished the contractor or seller. Copies 
of unilateral contracts and modifications with carbon impressioned 
signatures may be used but must be stamped ``DUPLICATE ORIGINAL'' (see 
304.101).
[49 FR 36110, Sept. 14, 1984]



                    Subpart 304.6--Contract Reporting



304.602  Federal Procurement Data System.

    The Department-wide Contract Information System (DCIS) represents 
the Department's implementation of the FPDS. All departmental 
contracting activities are required to participate in the DCIS and 
follow the procedures stated in the Contract Information System Manual 
and amendments to it. The principal official responsible for acquisition 
shall ensure that all required contract information is collected, 
submitted, and received into the DCIS on or before the 15th of each 
month for all appropriate contract and contract modification awards of 
the prior month.
[49 FR 13965, Apr. 9, 1984. Redesignated at 51 FR 44293, Dec. 9, 1986]



                      Subpart 304.8--Contract Files



304.801  General.

    OPDIVs shall prescribe the contents of contract files and establish 
filing procedures consistent with the nature of the contracting actions 
and in accordance with FAR 4.801, 4.802, and 4.803. Contract files 
should contain an index of the contents to facilitate review and should 
be separated into logical categories (see FAR 4.803).



04.804  Closeout of contract files.



304.804-1  Closeout by the office administering the contract.

    (3) Files for all cost-reimbursement type contracts should be closed 
within 20 months of the month in which the contracting officer receives 
evidence of physical completion (see FAR 4.804-4). The contracting 
officer responsible for contract closeout may negotiate settlement of 
indirect costs for a specific contract, in advance of the determination 
of final indirect cost rates in accordance with FAR 42.708.



304.870  Closing review.

    (a) Contracting officers shall assure the applicable items in FAR 
4.804-5,

[[Page 19]]

other than a field audit, have been accomplished prior to closing any 
physically completed contract. Cost-reimbursement type contracts will be 
subject to the additional requirements set forth below before they may 
be closed.
    (b) Contracting officers shall use the instructions in the October 
5, 1982 memorandum from the Deputy Assistant Secretary for Procurement, 
Assistance and Logistics to closeout cost-reimbursement type contracts 
physically completed prior to fiscal year 1977 and cost-reimbursement 
type contracts completed subsequent to that date for which field audit 
information is available.
    (c) Contracting officers shall closeout all other cost-reimbursement 
type contracts physically completed after September 30, 1977 in 
accordance with the following procedures:
    (1) Field audits will be conducted for contracts in excess of 
$500,000 awarded to commercial organizations and non-profit 
organizations other than colleges and universities, hospitals and State 
and local units of government for which an agency other than HHS has 
audit cognizance. Field audits will also be conducted each year on 
approximately 25 of the same type contractors for which HHS has audit 
cognizance. These contracts may be closed after receipt of the field 
audit report.
    (2) Contracts of any dollar value with non-proprietary colleges and 
universities, hospitals and State and local units of government and 
contracts not in excess of $500,000 with other institutions/
organizations shall be closed out on the basis of a desk audit. The desk 
audit should include (i) a confirmation from the project officer that 
labor, material, travel, and other types of direct costs are 
commensurate with contract requirements, (ii) a review of available 
audit reports to determine if any adjustments were made that may be 
applicable to the contract under review, and (iii) discussions with the 
cognizant government auditor when considered appropriate. These 
contracts shall be closed with the condition that they are subject to 
adjustment should an on-site audit be conducted at a later date and 
should unallowable costs be identified as a result of that audit. The 
release executed by the contractor shall contain the following:

    The Contractor agrees, pursuant to the clause in this contract 
entitled Allowable Cost (for cost-reimbursement contracts) or Allowable 
Cost and Fixed Fee (for CPFF contracts), that the amount of any 
sustained audit exceptions resulting from any audit made after final 
payment will be refunded to the Government.

    (3) The contracting officer may request a field audit of any 
contract when, in his/her judgment, the risk attendant with the contract 
warrants it. The contracting officer, however, shall exercise discretion 
in requesting such audits on creditable evidence such as unsatisfactory 
dealings with the contractor during the period of contract performance, 
prior audit reports containing serious findings against the contractor, 
the known experience of other government officials in dealing with the 
contractor when the contracting officer is personally knowledgeable 
about the circumstances, formal third party complaints or allegations 
which bear upon the contractor's integrity or the propriety of costs 
charged to the Government, and other comparable allegations or advice of 
a derogatory nature about the contractor made by responsible individuals 
which in the contracting officer's judgment should be investigated. 
Except where a contracting officer suspects misrepresentation or fraud, 
audits should not be requested if their cost of performance is likely to 
exceed their potential cost recovery.
    (4) When an audit is warranted prior to closing out a contract, the 
contracting officer should request the audit directly from the 
Department of Health and Human Services Office of the Inspector General, 
Office of Audits (HHSOA). The request should cite the reasons the 
contracting officer believes an audit is warranted. A copy of the 
request should be forwarded to the Director, Office of Acquisition and 
Grants Management (DOAGM). In the event the Office of the Inspector 
General cannot honor the request in a reasonable period of time, it will 
consult with DOAGM and the contracting officer. The final decision on 
the need and scope of an audit will be made on the basis of the value of 
the contract, the

[[Page 20]]

nature of the contracting officer's concerns, and the availability of 
HHSOA or other existing resources in the Department to perform a review 
to satisfy the contracting officer's concerns.
    (5) Closeout procedures are to be followed in conjunction with the 
regular procedures now followed in administering contracts. These 
procedures are not meant or to be interpreted as imposing any 
requirement or responsibility on contracting officers or necessitating 
any reviews on the part of the contracting officials not currently 
required by the FAR. With some rare exceptions, Standard Form 1034, 
Public Voucher for Purchases and Services Other than Personal, will 
contain sufficient information to allow a contracting officer to satisfy 
requirements for desk audits. Accordingly, these closeout procedures 
shall not cause contracting officers to engage in extraordinary 
oversight or review and shall not be used by contracting officers as the 
basis for requiring contractors to submit extraordinary documentation 
such as payroll listing, labor billings, travel details, etc.
[49 FR 13965, Apr. 9, 1984, as amended at 54 FR 24342, June 7, 1989; 54 
FR 43965, Oct. 30, 1989; 56 FR 47002, Sept. 17, 1991]



 Subpart 304.70--Acquisition Instrument Identification Numbering System



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.



304.7001  Numbering contracts.

    (a) Contracts which require numbering. The following contracts shall 
be numbered in accordance with the system prescribed in paragraph (b) of 
this section:
    (1) All contracts, including letter contracts and task orders under 
basic ordering agreements, which involve the payment of $2,500 or more 
for the acquisition of personal property or nonpersonal services.
    (2) All contracts which involve the payment of $2,000 or more for 
construction (including renovation or alteration).
    (3) All contracts which involve more than one payment regardless of 
amount.

(The number assigned to a letter contract shall be assigned to the 
superseding definitized contract.)
    (b) Numbering system. All contracts which require numbering shall be 
assigned a number consisting of the following:
    (1) The three digit code assigned to the contracting office by the 
Office of Financial Operations, Office of Finance.
    (2) A two digit fiscal year designation; and
    (3) A four digit serial number. While it is required that a 
different series of four digit serial numbers be used for each fiscal 
year, serial numbers assigned need not be sequential.
    (c) Illustration of contract numbers. The initial contract executed 
by the Division of Contract Operations, Office of the Secretary, for 
fiscal year 1983 should be numbered 100-83-0001, the second contract 
100-83-0002. Alternatively, if it is desirable for internal 
identification purposes to establish separate series of numbers for 
sealed bid and negotiated contracts, this procedure is permissible. In 
this instance, the initial sealed bid contract might be numbered 100-83-
0001 and the initial negotiated contract numbered 100-83-0500.
    (d) Assignment of identification codes. Each contracting office of 
the Department shall be assigned a three digit identification code by 
the Office of Financial Operations. Requests for the assignment of such 
codes for newly established contracting offices shall be submitted by 
the headquarters acquisition staff office of the contracting activity to 
the Director, Office of Financial Operations. Conversely, in the event 
that a contracting office is to be disestablished, the Director, Office 
of Financial Operations shall be notified.

[[Page 21]]

A listing of the contracting office identification codes currently in 
use is contained in the Department-wide Contract Information System 
Manual (DCIS).
[49 FR 13961, Apr. 9, 1984, as amended at 50 FR 23126, May 31, 1985; 50 
FR 38004, Sept. 19, 1985; 54 FR 24342, June 7, 1989]



304.7002  Numbering solicitation documents.

    Requests for proposals and invitations for bids shall be numbered in 
accordance with procedures prescribed by the headquarters staff office 
of the contracting activity.



304.7003  Numbering purchase and delivery orders.

    Contracting offices shall establish procedures for numbering 
purchase orders as required for effective identification and control.



304.7004  Numbering basic agreements.

    Basic agreements shall be numbered in accordance with procedures 
prescribed by the headquarters staff office of the cognizant contracting 
activity. However, individual contracts entered into pursuant to the 
terms and conditions of a basic agreement shall be numbered in 
accordance with 304.7001(b).



304.7005  Numbering basic ordering agreements.

    Basic ordering agreements shall be numbered in accordance with 
procedures prescribed by the headquarters staff office of the 
contracting activity.
[49 FR 13965, Apr. 9, 1984, as amended at 53 FR 15563, May 2, 1988]



     Subpart 304.71--Review and Approval of Proposed Contract Awards



304.7100  Scope of subpart.

    This subpart prescribes review and approval procedures for contract 
actions to ensure that:
    (a) Contract awards are in conformance with law, established 
policies and procedures, and sound business practices;
    (b) Contractual documents properly reflect the mutual understanding 
of the parties; and
    (c) The contracting officer is informed of deficiencies and items of 
questionable acceptability and corrective action is taken.



304.7101  Contracts requiring review and approval.

    (a) General. All contractual documents, regardless of dollar value, 
are to be reviewed by the contracting officer prior to award, even if 
the review and approval procedures prescribed in this section are 
applicable. However, under no circumstances may the individual who signs 
a contract instrument as contracting officer perform final review and 
approval of that contract action if it, or any modification to it, is 
expected to exceed the levels set forth in (b) (1) or (2) below.
    (b) Required reviews and approvals. (1) Officials responsible for 
the acquisition function in the Office of the Secretary, OPDIVs (except 
the Public Health Service), and regional offices are to assure that 
sealed bid or negotiated contracts, and/or modifications to them, 
expected to exceed $300,000, are reviewed and approved prior to award. 
In order to assure the propriety of smaller dollar acquisitions, a 
statistically significant sample of contract actions not expected to 
exceed $300,000 are to be reviewed and approved prior to award.
    (2) Contract actions of the Public Health Service are to be reviewed 
and approved prior to award in accordance with the dollar thresholds 
stated in Subpart PHS 304.71. In order to assure the propriety of 
smaller dollar acquisitions, a statistically significant sample of 
contract actions not expected to exceed those dollar thresholds 
referenced in Subpart PHS 304.71 are to be reviewed and approved prior 
to award.
    (c) Reviewing officials. Officials assigned responsibility for 
review and approval of contract actions must possess qualifications in 
the field of acquisition commensurate with the level of review 
performed, and, as a minimum, possess those acquisition skills expected 
of a contracting officer. The following officials are responsible for 
preaward contract review and approval:

Office of the Secretary--

[[Page 22]]

    Director, Division of Contract and Grant Operations
    Director, Division of Contract Operations, Office of Administrative 
and Management Services
Office of Human Development Services--Director, Grants and Contracts 
Management Division
Social Security Administration--Director, Office of Acquisition and 
Grants (may be redelegated to the appropriate division direction within 
the Office of Acquisition and Grants)
Health Care Financing Administration--Director, Division of Procurement 
Services.
Public Health Service--The reviewing official is designated in Subpart 
PHS 304.71, as approved by the Director, Office of Procurement and 
Logistics Policy, OPAL.


However, if any of the officials are to serve as the contracting officer 
and sign the contractual document, the review and approval function 
shall be performed by an appropriate official at least one level above.
    (d) Regional offices. The Director, Regional Administrative Support 
Center (RASC) is responsible for review and approval of contracts, or 
modifications to them, expected to exceed $300,000 and executed by the 
regional office's contracting staff. The RASC may obtain the advice of 
the Regional Attorney in the review of proposed contract awards.
[49 FR 13961, Apr. 9, 1984, as amended at 50 FR 23127, May 31, 1985; 50 
FR 38004, Sept. 19, 1985; 51 FR 44293, Dec. 9, 1986; 52 FR 27558, July 
22, 1987; 54 FR 24343, June 7, 1989]



304.7102  Conduct of the review.

    (a) General. Reviewing officials may solicit the participation of 
specialists in various technical and administrative disciplines to aid 
in the review. The method of the review is not prescribed here in order 
to permit discretionary judgment in determining the depth to which 
significant areas are to be examined.
    (b) Contract file. The reviewer is to: (1) Determine that the 
contract file constitutes an independent record, documented to provide a 
complete chronology of actions related to all aspects of the 
acquisition, and that the documentation is consistent with the 
requirements of FAR 4.803;
    (2) Determine that each contract file contains documentation or 
other data (i.e., technical and business management evaluation, cost 
advisory and audit reports, negotiation memorandum, etc.) sufficient to 
explain and support the rationales, judgments, and authorities upon 
which all decisions and actions were predicated; and
    (3) Ascertain:
    (i) If the proposed acquisition action is to be awarded by other 
than full and open competition, that the documentation and approvals 
supporting the decision are present in the contract file;
    (ii) That proper publicizing of the proposed acquisition was made 
pursuant to FAR Part 5;
    (iii) That approval was obtained for any deviation from prescribed 
contract clauses;
    (iv) That sufficient competition was obtained, the competitive range 
was appropriately determined, and oral or written discussions were 
conducted with all firms in the competitive range;
    (v) That all the rules set forth in FAR Part 14 were complied with 
when the proposed award is a result of an IFB; and
    (vi) That appropriate determinations and findings which justify the 
type of contract and advance payments are a part of the contract file.
[49 FR 13961, Apr. 9, 1984, as amended at 50 FR 23127, May 31, 1985; 50 
FR 38004, Sept. 19, 1985]



304.7103  Approvals.

    (a) Awards are not to be made until approval is granted by the 
reviewing official identified in 304.7101. All approvals are to be in 
writing, except that when time is of the essence approval may be given 
orally and subsequently confirmed in writing.
    (b) The reviewing official shall not approve a proposed contract 
award if a substantive issue (or issues) remains to be resolved. 
However, in appropriate circumstances, the reviewing official may use 
discretion and grant approval on a conditional basis and require the 
contracting officer to submit follow-up written documentation that the 
substantive issue has been resolved. This provides the reviewing 
official the option to require the contracting officer to resolve the 
substantive issue and submit documenting evidence before award approval 
is given, or to grant

[[Page 23]]

conditional approval providing the substantive issue is resolved before 
the contract is awarded and require the contracting officer to submit 
documenting evidence either before or after the award. The reviewing 
official also has the option to determine the extent of documentation 
evidence to be submitted by the contracting officer. This may range from 
complete resubmission of the contract file to submission of a memorandum 
stating the contracting officer's actions in resolving the substantive 
issue.

[[Page 24]]



                   SUBCHAPTER B--ACQUISITION PLANNING





PART 305--PUBLICIZING CONTRACT ACTIONS--Table of Contents




               Subpart 305.1--Dissemination of Information

Sec.
305.102  [Reserved]

          Subpart 305.2--Synopsis of Proposed Contract Actions

305.202  Exceptions.

               Subpart 305.3--Synopses of Contract Awards

305.303  Announcement of contract awards.

                   Subpart 305.5--Paid Advertisements

305.502  Authority.
305.503  Procedures.

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

    Source:  49 FR 13969, Apr. 9, 1984, unless otherwise noted.



               Subpart 305.1--Dissemination of Information



Sec. 305.102  [Reserved]



          Subpart 305.2--Synopsis of Proposed Contract Actions



305.202  Exceptions.

    (b) When a contracting office believes that it has a situation where 
advance notice is not appropriate or reasonable, it shall prepare a 
memorandum citing all pertinent facts and details and send it, through 
normal acquisition channels, to the Director, Office of Acquisition and 
Grants Management (DOAGM) requesting relief from synopsizing. The DOAGM 
shall review the request and decide whether an exception to synopsizing 
is appropriate or reasonable. If it is, the DOAGM shall take the 
necessary coordinating actions required by FAR 5.202(b). Whatever the 
decision is on the request, the DOAGM shall promptly notify the 
contracting office when a determination has been made.
[51 FR 44293, Dec. 9, 1986, as amended at 54 FR 24343, June 7, 1989]



               Subpart 305.3--Synopses of Contract Awards



305.303  Announcement of contract awards.

    (a) Public announcement. Any contract, contract modification, or 
delivery order in the amount of $1 million or more shall be reported by 
the contracting officer to the Office of the Deputy Assistant Secretary 
for Legislation (Congressional Liaison), Room 406G, Hubert H. Humphrey 
Building. Notification shall be accomplished by providing a copy of the 
contract or award document face page to the referenced office prior to 
the day of award, or in sufficient time to allow for an announcement to 
be made by 5 p.m. Washington, DC time on the day of award.
[53 FR 43207, Oct. 26, 1988, as amended at 57 FR 11689, April 7, 1992]



                   Subpart 305.5--Paid Advertisements



305.502  Authority.

    The contracting officer is authorized to publish advertisements, 
notices, and contract proposals in newspapers and periodicals in 
accordance with the requirements and conditions referenced in FAR 
Subpart 5.5.



305.503  Procedures.

    Requests for acquisition of advertising shall be accompanied by 
written authority to advertise or publish which sets forth justification 
and includes the names of newspapers or journals concerned, frequency 
and dates of proposed advertisements, estimated cost, and other 
pertinent information. Paid advertisements shall be limited to the 
publication of essential details of grant announcements, invitations for 
bids, and requests for proposals, including those for the sale of 
personal property, and for the recruitment of employees.

[[Page 25]]



PART 306--COMPETITION REQUIREMENTS--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  Justifications.
306.303-1  Requirements.
306.303-2  Content.
306.304  Approval of the justification.

         Subpart 306.4--Sealed Bidding and Competitive Proposals

306.401  Sealed bidding and competitive proposals.

                  Subpart 306.5--Competition Advocates

306.501  Requirement.
306.502  Duties and responsibilities.

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

    Source:  50 FR 23127, May 31, 1985, unless otherwise noted.



   Subpart 306.2--Full and Open Competition After Exclusion of Sources



306.202  Establishing or maintaining alternative sources.

    (a) The reference to the agency head in FAR 6.202(a) shall mean the 
appropriate competition advocate cited in 306.501.
    (b)(1) The required determination and findings (D&F) shall be 
prepared by the contracting officer based on the data provided by 
program personnel, and shall be signed by the appropriate competition 
advocate. The D&F signatory authority is not delegable.
[50 FR 23127, May 31, 1985, and 50 FR 38004, Sept. 19, 1985, as amended 
at 51 FR 44293, Dec. 9, 1986]



           Subpart 306.3--Other Than Full and Open Competition



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) Authority. (2)(ii) Follow-on contracts for the continuation of 
major research and development studies on long-term social and health 
programs, major research studies, or clinical trails may be deemed to be 
available only from the original source when it is likely that award to 
any other source would result in unacceptable delays in fulfilling the 
Department's or OPDIV's requirements.
    (b) Application. (4) When the OPDIV head has determined that a 
specific item of technical equipment or parts must be obtained to meet 
an activity's program responsibility to test and evaluate certain kinds 
and types of products, and only one source is available. (This criterion 
is limited to testing and evaluation purposes only and may not be used 
for initial outfitting or repetitive acquisitions. Project officers 
should support the use of this criterion with citations from their 
agency's legislation and the technical rationale for the item of 
equipment required.)
    (c) Application for brand name descriptions. There is existing 
equipment which, for reasons of compatibility and interchangeability, 
requires an item which is manufactured only by one source. (This 
criterion is for use in acquisitions where a particular brand name item 
is required, and an ``or equal'' will not meet the Government's 
requirements. This criterion may not be used when there are other 
manufacturers available which may be able to produce acceptable items 
even though their products might require some adjustments and 
modifications. These other manufacturers must be given the opportunity 
to compete.)
[50 FR 23127, May 31, 1985, and 50 FR 38004, Sept. 19, 1985, as amended 
at 51 FR 44293, Dec. 9, 1986; 57 FR 11689, Apr. 7, 1992]

[[Page 26]]



306.302-7  Public interest.

    (a) Authority. (2) Agency head, in this instance, means the 
Secretary.
    (c) Limitations. When using the authority cited in FAR 6.302-
7(a)(1), the Secretary's approval must be obtained. Therefore, an 
``approval package'' must be prepared and staffed through departmental 
acquisition channels to the Secretary. The package shall include:
    (1) A determination and findings, prepared by the contracting 
officer, for the Secretary to sign.
    (2) A letter for the Secretary to sign notifying Congress of the 
determination to award a contract under the authority of 41 U.S.C. 
253(c)(7). This letter must be received by Congress at least 30 days 
before contract award.
    (3) A ``Justification for Other than Full and Open Competition'' 
(JOFOC).
    (4) A briefing paper presenting background, need, etc.
    (5) Any other pertinent papers or documents required by the 
Department.



306.303  Justifications.



306.303-1  Requirements.

    (b) Preliminary arrangements or agreements with the proposed 
contractor made by someone other than the contracting officer shall have 
no effect on the rationale used to support an acquisition for other than 
full and open competition.
    (f) The program office should discuss prospective other than full 
and open competition requests with their supporting contracting office 
as early as possible during the acquisition planning stage (see FAR 
Subpart 7.1 and Subpart 307.1), and before submitting the requisition or 
request for contract. The discussions may resolve uncertainties, provide 
program offices with names of other sources, allow proper scheduling of 
the acquisition, and avoid delays which might otherwise occur should it 
be determined that the request for other than full and open competition 
is not justified.
    (g) When a program office desires to obtain certain goods or 
services by contract without full and open competition, it shall, at the 
time of forwarding the requisition or request for contract, furnish the 
contracting office a justification explaining why full and open 
competition is not feasible. All justifications shall be initially 
reviewed by the contracting officer.
    (1) Justifications in excess of the small purchase limitation shall 
be in the form of a separate, self-contained document, prepared in 
accordance with FAR 6.303 and 306.303, and called a ``JOFOC'' 
(Justification for Other than Full and Open Competition). Justifications 
of $25,000 or less may be in the form of a paragraph or paragraphs 
contained in the requisition or request for contract.
    (2) Justifications, whether over or under the small purchase 
limitation, shall fully describe what is to be acquired, offer reasons 
which go beyond inconvenience, and explain why it is not feasible to 
obtain competition. The justifications shall be supported by verifiable 
facts rather than mere opinions. Documentation in the justifications 
should be sufficient to permit an individual with technical competence 
in the area to follow the rationale.
[50 FR 23127, May 31, 1985, as amended at 57 FR 11689, Apr. 7, 1992]



306.303-2  Content.

    (a)(1) The program office and name, address, and telephone number of 
the project officer shall also be included.
    (2) This item shall include project identification such as the 
authorizing program legislation, to include citations or other internal 
program identification data such as title, contract number, etc.
    (3) A full description of the requirement and its dollar amount is 
to be included. It may be in the form of a statement of work, purchase 
description, or specification. A statement is to be included to explain 
whether the acquisition is an entity in itself, whether it is one in a 
series, or part of a related group of acquisitions.
    (c) Each JOFOC shall conclude with at least the following signatory 
lines (other concurrence lines may be added as deemed necessary by the 
contracting activity):

 Recommended, Project Officer___________________________________________
 Date___________________________________________________________________
 Concur, Project Officer's Immediate Supervisor_________________________
 Date___________________________________________________________________
 Concur, Contracting Officer____________________________________________

[[Page 27]]

 Date___________________________________________________________________
 Approved, Approving Official___________________________________________
 Date___________________________________________________________________



306.304  Approval of the justification.

    (a)(1) For purchases in excess of 10 percent of the small purchase 
limitation but not over the small purchase limitation, the contracting 
officer is authorized to review and approve (or disapprove) the 
justification (see 313.106(c)(2)). For acquisitions over the small 
purchase limitation, but not exceeding $100,000, the JOFOC shall be 
submitted to the contracting officer for review. The contracting officer 
will either concur or nonconcur, and forward the JOFOC to the principal 
official responsible for acquisition for approval. (When the contracting 
officer and principal official responsible for acquisition are the same 
individual, the approval will be made by the respective official listed 
in 306.501.) The principal official responsible for acquisition may 
redelegate approval for acquisitions between the small purchase 
limitation and $50,000 to the chief of the contracting office, provided 
that individual is at least one level above the contracting officer who 
will sign the contract.
    (2) The competition advocates are listed in 306.501.
    (3) The following shall serve as the approving officials referenced 
in FAR 6.304(a)(3):

HCFA--Administrator for Health Care Financing
OHDS--Assistant Secretary for Human Development Services
OS--Assistant Secretary for Management and Budget
PHS--Assistant Secretary for Health (may be delegated to the Deputy 
Assistant Secretary for Health Operations)
SSA--Commissioner of Social Security
RO's--Regional Director


This authority is not delegable, except as indicated for PHS.
    (4) The senior procurement executive of the Department is the 
Assistant Secretary for Management and Budget.
    (c) A class justification shall be processed the same as an 
individual justification.
    (d) The contracting officer who receives a JOFOC for processing 
shall, after ascertaining that the document is complete, request advice 
from pricing, audit, legal, and other appropriate staff offices, and 
forward the JOFOC with his or her concurrence or nonconcurrence, to the 
appropriate approving official. When the contracting officer does not 
concur with the JOFOC, a written explanation setting forth the reasons 
must be provided the approving official. If the JOFOC is disapproved by 
the approving official, the contracting officer shall promptly notify 
the concerned program office.
    (e) It is the responsibility of the approving official to determine 
whether a contract may properly be awarded without full and open 
competition. The program office and project officer are responsible for 
furnishing the contracting officer and approving official with pertinent 
supporting information necessary to make such determinations. Other 
staff offices shall advise the contracting officer and approving 
official as requested.
    (f) As each justification is reviewed, the approving official should 
ask: why the acquisition cannot be competed, are there sufficient 
grounds for excluding all other actual or potential sources, what 
actions can be taken to obtain full and open competition in the instant 
acquisition, and what actions are needed to avoid the need for a 
subsequent or continuing acquisition that is for other than full and 
open competition?
[50 FR 23127, May 31, 1985, as amended at 56 FR 47002, Sept. 17, 1991]



         Subpart 306.4--Sealed Bidding and Competitive Proposals



306.401  Sealed bidding and competitive proposals.

    The requirement in FAR 6.401 to document the reasons sealed bidding 
is not appropriate may be accomplished by adding a sentence to the 
negotiation memorandum (see 315.672) specifying which criterion (or 
criteria) listed in FAR 6.401(a) is (are) not applicable to the 
acquisition.



                  Subpart 306.5--Competition Advocates



306.501  Requirement.

    The Department's competition advocate is the Deputy Assistant 
Secretary

[[Page 28]]

for Management and Acquisition. The competition advocates for the 
Department's primary contracting offices are as follows:

HCFA--Associate Administrator for Management and Support Services
OHDS--Director, Office of Management Services
OS--Director, Office of Acquisition and Grants Management
OASH--Director, Administrative Services Center
ADAMHA--Associate Administrator for Management
AHCPR--Executive Officer, Agency for Health Care Policy and Research
CDC--Director, Office of Program Support
FDA--Associate Commissioner for Management and Operations
HRSA--Associate Administrator for Operations and Management
IHS--Associate Director, Office of Administration and Management
NIH--(R&D)--Associate Director for Extramural Affairs (Other than R&D)--
Associate Director for Intramural Affairs
SSA--Deputy Commissioner for Management.
RO's--Director, Regional Administrative Support Center
[50 FR 23127, May 31, 1985, and 50 FR 38004, Sept. 19, 1985, as amended 
at 52 FR 27558, July 22, 1987; 53 FR 15563, May 2, 1988; 53 FR 43207, 
Oct. 26, 1988; 54 FR 24343, June 7, 1989; 55 FR 42197, Oct. 18, 1990]



306.502  Duties and responsibilities.

    (b) The competition advocates listed in 306.501 shall assist the 
Department's competition advocate, when requested, by providing data and 
reports to aid in the accomplishment of the duties required of the 
Department's competition advocate as stated in FAR 6.502(a).
[50 FR 23127, May 31, 1985, as amended at 50 FR 38004, Sept. 19, 1985]



PART 307--ACQUISITION PLANNING--Table of Contents




                    Subpart 307.1--Acquisition Plans

Sec.
307.104  General procedures.
307.104-1  Requirement for acquisition planning.
307.104-2  Responsibilities for acquisition planning.
307.104-3  Preparation of acquisition plan.
307.105  Contents of written acquisition plans.
307.105-1  Format and content.
307.105-2  Special program clearances or approvals.
307.105-3  Specification, purchase description, and statement of work.
307.170  Program training requirements.
307.170-1  Policy exceptions.
307.170-2  Training course prerequisites.

         Subpart 307.3--Contractor Versus Government Performance

307.302  General.
307.303  Determining availability of private commercial sources.
307.304  Procedures.
307.307  Appeals.

     Subpart 307.70--Considerations in Selecting an Award Instrument

307.7000  Scope of subpart.
307.7001  Applicability.
307.7002  Purpose.
307.7003  Distinction between acquisition and assistance.
307.7004  Procedures.

   Subpart 307.71--Phase II Advance Acquisition Planning (Scheduling)

307.7101  Background.
307.7102  Accountability and responsibility.
307.7103  Purpose.
307.7104  Contracting activity actions.

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

    Source:  49 FR 13969, Apr. 9, 1984, unless otherwise noted.



                    Subpart 307.1--Acquisition Plans



307.104  General procedures.

    (a) The acquisition planning document is an administrative tool 
designed to enable the contracting officer and project officer to plan 
effectively for the accomplishment of an acquisition during a specified 
time frame. The acquisition planning document serves as an outline of 
the method by which the contracting officer expects to accomplish the 
acquisition task.
    (c) If the plan proposes using other than full and open competition, 
the plan shall also be coordinated with the Chief of the contracting 
office, acting for the competition advocate.
[49 FR 13969, Apr. 9, 1984, as amended at 50 FR 23129, May 31, 1985; 50 
FR 38004, Sept. 19, 1985; 51 FR 44293, Dec. 9, 1986]

[[Page 29]]



307.104-1  Requirement for acquisition planning.

    (a) The acquisition planning document is required for all new 
negotiated acquisitions which are expected to exceed $100,000, except 
the following:
    (1) Acquisition of architect-engineer services;
    (2) Acquisitions of utility services where the services are 
available from only one source; and
    (3) Acquisitions made from or through other Government agencies.
    (b) An acquisition planning document is also required for all two-
step sealed bid acquisitions expected to exceed $100,000.
    (c) The principal official responsible for acquisition shall 
prescribe acquisition planning procedures for:
    (1) Negotiated acquisitions which are not expected to exceed 
$100,000;
    (2) Two-step sealed bid acquisitions which are not expected to 
exceed $100,000; and
    (3) All other sealed bid acquisitions regardless of dollar amount.
    (d) An acquisition planning document is not required for a contract 
modification which either exercises an option or adds funds to an 
incrementally funded contract, provided there is an approved acquisition 
planning document in accordance with 307.105 and there is no significant 
deviation from that plan.
[49 FR 13969, Apr. 9, 1984, as amended at 50 FR 23126, May 31, 1985; 50 
FR 38004, Sept. 19, 1985]



307.104-2  Responsibilities for acquisition planning.

    (a) Planning by program and staff activities. Whenever execution of 
a program or project requires the acquisition of property or services by 
contract, the program or project plan shall delineate all elements to be 
acquired by contract. The program or project plans must include a plan 
and time-frame for completion action.
    (b) Planning for acquisition actions. Action should commence as 
early as possible to effect an orderly and balanced acquisition workload 
throughout a fiscal year. Project officers who expect to initiate 
acquisitions are required to discuss their requirements with the 
contracting officials who will be responsible for these acquisitions to 
compare current staff capabilities with anticipated requirements to 
achieve an even distribution of fiscal year workload consistent with 
program needs. These discussions should result in understandings on:
    (1) The details of the acquisition plan;
    (2) Schedule for the completion of the acquisition plan;
    (3) Preliminary discussions on the work statement/specifications and 
appropriate evaluation criteria; and
    (4) Preliminary discussions on the content and timing of the request 
for contract (RFC).
    (c) Planning by contracting activities. Contracting activities are 
required to coordinate with program and staff offices to ensure:
    (1) Timely and comprehensive planning for acquisitions;
    (2) Timely initiation of requests for contracts; and
    (3) Instruction of program and staff offices in proper acquisition 
practices and methods.



307.104-3  Preparation of acquisition plan.

    (a) The acquisition planning document serves as an advance agreement 
between program and contracting personnel by outlining the methods of 
how and when the acquisition is to be accomplished. It serves to resolve 
problems early in the acquisition cycle thereby precluding delays in 
contract placement. It is developed prior to the preparation and 
submission of the formal request for contract to the contracting 
activity. (For detailed information concerning the request for contract, 
see Subpart 315.70.)
    (b) The acquisition planning document shall be prepared jointly by 
the project officer and the contract negotiator or in accordance with 
procedures prescribed by the principal official responsible for 
acquisition.



307.105  Contents of written acquisition plans.



307.105-1  Format and content.

    The Department does not prescribe a standard format for the 
acquisition planning document, but recommends the use of a format 
similar to what is

[[Page 30]]

provided in this section. The subject areas addressed in paragraphs (a) 
through (e) must be included in every acquisition planning document. An 
OPDIV, agency, or regional office contracting activity may prescribe a 
standard format for the acquisition planning document and may include 
additional subject areas that are pertinent to that activity's needs.
    (a) Identification information. The contracting activity shall 
prescribe the information necessary for readily identifying a planned 
acquisition. The information may include items such as acquisition 
planning document number, request for contract number, public law, 
program or project officer, etc.
    (b) Programmatic considerations. (1) Description of the project/
supplies/services. Include a brief description of the proposed project/
supplies/services. Discuss all anticipated future requirements related 
to the acquisition. Discuss any past, present or future interrelated 
projects.
    (2) Project funding. Include the summary of funds expected to be 
obligated for the entire project by fiscal years and phases. Include 
expenditures for previous years. Discuss the probability of obtaining 
future years funding and/or what specific managerial action can be taken 
to insure future funding (if applicable).
    (3) Background and acquisition history. Provide a brief factual 
summary of the technical and contractual history of the supplies/
services being acquired.
    (4) Related projects, efforts undertaken to avoid duplication of 
effort. Discuss efforts made to determine if existing projects, supplies 
or materials will satisfy the requirement. Include any related in-house 
efforts, searches, and clearinghouse reviews made to avoid duplication 
of effort.
    (5) Need for project/supplies/services. Discuss rationale for 
deciding on the need for the project/supplies/services.
    (6) Special program clearances or approvals. Review 307.105-2 to 
determine which special program clearances or approvals are required. 
Specify clearances or approvals applicable to this acquisition.
    (7) Phasing. Briefly describe discrete tasks or stages of 
accomplishment which could be susceptible to phasing. Describe criteria 
for evaluation of performance of each phase before proceeding to the 
next. (See 307.105-3(c)(3) for a discussion on phasing.)
    (8) Government furnished material/facilities. Indicate material and 
facilities that will be furnished to the contractor and any associated 
problems which may be encountered. Discuss possible inequities which may 
arise in furnishing the materials or facilities. Discuss screening 
efforts for availability through GSA excess property schedules.
    (9) Discussion of project risk. Provide a discussion of major areas 
of project risk including technical, cost, and schedule risk. Describe 
what efforts are planned to reduce risk. If an acquisition, which is 
planned to be awarded using other than full and open competition 
represents a significant portion of a proposed contractor's business, 
discuss the impact on technical capability, realism of schedule, changes 
in contractor workload and related cost impact.
    (10) Reporting/delivery requirements. Describe the basis for 
establishing the delivery/reporting requirements and include the 
anticipated deliverables and time(s) for delivery.
    (11) Replication, dissemination, or use of the results. Discuss 
anticipated replication, dissemination, or use of the results. Describe 
user audience and their expected use. Include a description of the 
delivery system.
    (12) Data, data rights, patents, copyrights. Discuss data to be 
developed. Specify data to be delivered and data to remain in the 
contractor's possession. Discuss how the data is to be used, maintained, 
disclosed and disposed of by the contractor. Discuss data subject to the 
Privacy Act or Confidentiality of Information clause. Discuss data to be 
delivered with limited rights, data where title would not vest in the 
Government, and anticipated copyrights or patents. Discuss whether or 
not the data will permit any follow-on acquisitions to be competitive.
    (13) Post-award administration and monitoring. Detail milestones 
that require periodic evaluation of the contractor's progress. Discuss 
any formal management systems to be used to monitor the contractor. 
Discuss plans

[[Page 31]]

for post-award conference and site visits. Delineate the timing of the 
periodic status reports.
    (14) Technical evaluation plans. Discuss the plans for technical 
evaluation of the proposal. Discuss whether non-Federal technical 
evaluators will review the proposals. Discuss potential conflict of 
interest situations.
    (c) Acquisition approach. (1) Proposed sources. Include sources or 
categories of sources (if apparent). Address the pertinent areas stated 
in FAR 7.105(b)(2).
    (2) Contract type. Provide the rationale for recommendation of 
contract type.
    (3) Socioeconomic programs. Discuss preliminary liaison with the 
Small and Disadvantaged Business Utilization Specialist for review to 
determine requirements susceptible for the various socioeconomic 
acquisition programs; i.e., small business, disadvantaged business, or 
labor surplus area set-asides.
    (4) Other considerations, as applicable. Discuss special contract 
clauses and proposed HHSAR deviations, if required. Discuss 
circumstances such as the effect of a protest on a previous acquisition 
to this acquisition, special public law or regulatory requirements which 
place restrictions on this acquisition, and use of a special type of 
synopsis. Address planned preproposal conference, preaward survey and 
preaward site visits.
    (d) Planning for the acquisition cycle. (1) Scheduling 
considerations. The project officer and the contract negotiator shall 
establish realistic planned dates which meet the program needs for award 
to assure timely delivery or completion of the project. The following 
factors should be considered in planning realistic dates:
    (i) Individual project officer and contract negotiator workloads;
    (ii) Planned, extended absences from the office; and
    (iii) Schedules are in consonance with established office goals for 
overall orderly and balanced workloads.
    (2) Acquisition planning schedule. The following acquisition 
planning schedule should be included in all plans to the extent the 
items are significant or appropriate to the acquisition. Additional 
items may be added as appropriate.

                      Acquisition Planning Schedule

                            Actions and Date

Advance or sources sought synopsis released
Advance or sources sought synopsis closed
Synopsis evaluation received
Request for contract received
Special program approvals received
Synopsis publicizing proposed acquisition released
Request for proposal released
Preproposal conference conducted
Proposals received
Technical evaluation received
Cost advisory or audit report received
Equal opportunity clearance obtained
Prenegotiation conference conducted
Negotiation completed
Contract document prepared
Contract approval completed
Contract released
Award

    (e) Approvals. All acquisition planning documents shall be signed by 
the project officer and the contract negotiator. Acquisition planning 
documents for acquisitions estimated to be between $100,000 and 
$1,000,000 shall be approved by the contracting officer. Acquisition 
planning documents for acquisitions estimated to be in excess of $1 
million shall be approved by the principal official responsible for 
acquisition or his/her designee. The designated official shall be in a 
position no lower than the level above the contracting officer. One copy 
of all acquisition planning documents shall be filed with the principal 
official responsible for acquisition or the designated official for 
planning purposes. The original acquisition planning document shall be 
retained in the contract file.
[49 FR 13969, Apr. 9, 1984, as amended at 50 FR 23129, May 31, 1985; 50 
FR 38004, Sept. 19, 1985]



307.105-2  Special program clearances or approvals.

    The following special program clearances or approvals should be 
reviewed for applicability to each planned acquisition. The ones which 
are applicable should be addressed in the acquisition planning document 
and immediate programmatic action should be initiated to obtain the 
necessary clearances or approvals.

[[Page 32]]

    (a) Clearances or approvals required to be completed and submitted 
with the request for contract (RFC).--(1) Automatic data processing. All 
proposed acquisitions of automatic data processing hardware, software 
packages, and services, as well as telecommunications equipment, which 
exceed the dollar thresholds stated in Chapter 4-10 of the HHS 
Information Resources Management (IRM) Manual, must be reviewed and 
approved by the Office of Information Resources Management (OIRM), 
OASMB-0S. (See HHS Information Resources Management (IRM) Manual, 
Chapter 4-10; Title 41 CFR Chapter 201; and Subpart 339.70.)
    (2) ADP systems security. All ADP systems regardless of dollar 
amount are required to have a Certification of ADP Systems Security 
Adequacy signed by the ADP system manager and the cognizant ADP systems 
security officer. (See HHS IRM Manual, Part 6--ADP Systems Security; OMB 
Circular No. A-71, Transmittal Memorandum No. 1; and Subpart 339.70.)
    (3) Advisory and assistance services. OPDIV and STAFFDIV heads and 
regional directors are responsible for review and approval of all 
proposed advisory and assistance services contracts and purchase orders. 
(See General Administration Manual Chapter 8-15.)
    (4) Evaluation contracts. The Assistant Secretary for Planning and 
Evaluation (ASPE) must approve all evaluation projects for proposed 
solicitations, except those which have been included in research, 
demonstration, or evaluation plans previously approved by the ASPE.
    (5) Commercial activities. (OMB Circular No. A-76) A request for 
contract (RFC) must contain a statement as to whether the proposed 
solicitation is or is not to be used as part of an OMB Circular No. A-76 
cost comparison. (See General Administrative Manual (GAM) Chapter 18-10; 
FAR Subpart 7.3, Subpart 307.3; OMB Circular No. A-76.)
    (6) Paid advertising. Paid advertisements, notices or contract 
proposals to be published in newspapers and periodicals may be 
authorized by the contracting officer. (See FAR Subpart 5.5, Subpart 
305.5; Title 7, Chapter 5-25.2, and the General Accounting Office Policy 
and Procedures Manual for Guidance of Federal Agencies.)
    (7) Printing. The acquisition of printing by contract is prohibited 
unless it is authorized by the Joint Committee on Printing of the U.S. 
Congress. Procedures to be followed are contained in the ``Government 
Printing and Binding Regulations'' and the HHS Printing Management 
Manual and FAR Subpart 8.8.
    (8) Fraud, abuse and waste. All proposed acquisitions that concern 
the subjects of fraud, abuse and waste must be reviewed and approved by 
the Inspector General or Deputy Inspector General, and written approval 
from either must be included in the request for contract.
    (9) Paperwork Reduction Act. Under the Paperwork Reduction Act of 
1980 (Pub. L. 96-511), a Federal agency shall not collect information or 
sponsor the collection of information from ten or more persons (other 
than Federal employees acting within the scope of their employment) 
unless, in advance, the agency has submitted Standard Form 83, Request 
for OMB Review, to the Director of the Office of Management and Budget, 
and the Director has approved the proposed collection of information. 
Procedures for the approval may be obtained by contacting the OPDIV 
reports clearance officer. (See Title 5 CFR Part 1320 and General 
Administration Manual Chapter 10-20.)
    (10) Contracts with federal employees. Contracts between the 
Government and Government employees or between the Government and 
organizations which are substantially owned or controlled by Government 
employees may not knowingly be entered into, except for the most 
compelling reasons (see FAR Subpart 3.6). Authority to enter into a 
contract with a Government employee or an organization substantially 
owned or controlled by a Government employee must be approved prior to 
award of the contract by either the Assistant Secretary for Management 
and Budget, the head of the OPDIV, or the regional director, or their 
designees. (See 45 CFR Part 73 and HHS Standards of Conduct.)
    (11) Publications. All projects which will result in contracts and 
which include publications require review and

[[Page 33]]

approval by the Office of the Assistant Secretary for Public Affairs 
(OASPA). Form HHS-615, Publication Planning and Clearance Request, 
should be forwarded to OASPA through the OPDIV public affairs officer. 
Publications are defined in the chapter on publications in the Public 
Affairs Management Manual.
    (12) Public affairs services. Projects for the acquisition of public 
affairs services in excess of $5,000 shall be submitted to the Office of 
the Assistant Secretary for Public Affairs (OASPA) for review and 
approval on Form HHS-524, Request for Public Affairs Service Contract.
    (13) Audiovisual (videotape and motion picture production). Any 
proposed acquisition of an audiovisual production requires the 
submission of a Standard Form 282, Mandatory Title Check, to the 
National Audiovisual Center (NAC). When the results of this title check 
have been reviewed by the project office and if a determination is made 
that existing materials are not adequate to fulfill the requirement, a 
statement to that effect shall be prepared by the project office. For 
acquisitions in excess of $5,000, a copy of that statement, together 
with a Standard Form 202, Federal Audiovisual Production Report, and 
Form HHS-524A, Request for Audiovisual Material, shall be submitted 
through the OPDIV public affairs officer to the Office of the Assistant 
Secretary for Public Affairs (OASPA) for review and approval. Following 
approval by OASPA, the SF 202 and the statement explaining why existing 
materials are insufficient will be forwarded to NAC by OASPA. An 
approved copy of the Form HHS-524A will be returned to the OPDIV for 
transmission to the contract negotiator. All audiovisuals are required 
to be acquired under the Government-wide Contracting System for Motion 
Picture and Videotape Productions, unless they are included in the 
exceptions to the mandatory use of the uniform system. (See the 
Executive Agent for Government-Wide Contracting System for Audiovisual 
Productions' March 21, 1980, memorandum on Implementation of OFPP Policy 
Letter No. 79-4, November 28, 1979, Contracting for Motion Picture and 
Videotape Productions; HHS General Administration Manual Chapter 1-121.)
    (14) Privacy Act (Pub. L. 93-579.) Whenever the Department contracts 
for the design, development, operation, or maintenance of a system of 
records on individuals on behalf of the Department in order to 
accomplish a departmental function, the Privacy Act is applicable. The 
program official, after consultation with the activity's Privacy Act 
Coordinator and the Office of General Counsel as necessary shall include 
a statement in the request for contract as to the applicability of the 
Act. Whenever an acquisition is subject to the Act, the program official 
prepares a ``system notice'' and has it published in the Federal 
Register. (See HHS Privacy Act regulation, 45 CFR 5b; FAR Subpart 24.1 
and Subpart 324.1.)
    (b) Clearances or approvals required to be completed prior to 
contract award. All foreign research contract projects to be conducted 
in a foreign country and financed by HHS funds (U.S. dollars) must have 
clearance by the Department of State with respect to consistency with 
foreign policy objectives. This clearance should be obtained prior to 
negotiation. Procedures for obtaining this clearance are set forth in 
the HHS General Administration Manual, Chapter 20-60.
[49 FR 13969, Apr. 9, 1984, as amended at 49 FR 36110, Sept. 14, 1984; 
50 FR 23129, May 31, 1985; 50 FR 38004, Sept. 19, 1985; 53 FR 15563, May 
2, 1988; 53 FR 43207, Oct. 26, 1988; 53 FR 44551, Nov. 3, 1988]



307.105-3  Specification, purchase description and statement of work.

    One of the most important parts of a contract is the description of 
the work to be done. The description of that work may be in the form of 
a specification, purchase description or statement of work. A brief 
reference to specifications and purchase descriptions is provided, 
although the nature of the work performed in this Department usually 
results in the development of work statements. The development of the 
acquisition planning document should result in sufficient information to 
readily develop the description of work, usually in the form of a 
statement of work.

[[Page 34]]

    (a) Specification. Specification is defined in FAR 10.001. Use of 
the specification is primarily limited to supply or service contracts 
where the material end item or service to be delivered is well defined 
by the Government.
    (b) Purchase description. FAR 10.001 also contains the definition of 
purchase description.
    (c) Statement of work.--(1) General. A statement of work differs 
from a specification and purchase description primarily in that it 
describes work or services to be performed in reaching an end result 
rather than a detailed, well defined description or specification of the 
end product. The statement of work may enumerate or describe the methods 
(statistical, clinical, laboratory, etc.) that will be used. However, it 
is preferable for the offeror to propose the method of performing the 
work. The statement of work should specify the desired results, 
functions, or end items without telling the offeror what has to be done 
to accomplish those results unless the method of performance is critical 
or required for the successful performance of the contract. The 
statement of work should be clear and concise and must completely define 
the responsibilities of the Government and the contractor. The statement 
of work should be worded so as to make more than one interpretation 
virtually impossible because it has to be read and interpreted by 
persons of varied backgrounds, such as attorneys, contracting personnel, 
cost estimators, accountants, scientists, sociologists, educators, 
functional specialists, etc. If the statement of work does not state 
exactly what is wanted, or does not state it precisely, it will generate 
many contract management problems for both the project officer and the 
contracting officer. Ambiguous statements of work can create 
unsatisfactory performance, delays, and disputes, and can result in 
higher costs.
    (2) Term (level of effort) vs. completion work statement. Careful 
distinctions must be drawn between term (level of effort) statements of 
work, which essentially require the furnishing of technical effort and a 
report thereof, and completion type work statements, which often require 
development of tangible end items designed to meet specific performance 
characteristics.
    (i) Term or level of effort. A term or level of effort type 
statement of work is appropriate to research where one seeks to discover 
the feasibility of later development, or to gather general information. 
A term or level of effort type statement of work may only specify that 
some number of labor-hours be expended on a particular course of 
research, or that a certain number of tests be run, without reference to 
any intended conclusion.
    (ii) Completion. A completion type statement of work is appropriate 
to development work where the feasibility of producing an end item is 
already known. A completion type statement of work may describe what is 
to be achieved through the contracted effort, such as the development of 
new methods, new end items, or other tangible results.
    (3) Phasing. Individual research, development, or demonstration 
projects frequently lie well beyond the present state of the art and 
entail procedures and techniques of great complexity and difficulty. 
Under these circumstances, a contractor, no matter how carefully 
selected, may be unable to deliver the desired result. Moreover, the job 
of evaluating the contractor's progress is often difficult. Such a 
contract is frequently phased and often divided into stages of 
accomplishment, each of which must be completed and approved before the 
contractor may proceed to the next. Phasing makes it necessary to 
develop methods and controls, including reporting requirements for each 
phase of the contract and criteria for evaluation of the reports 
submitted, that will provide, at the earliest possible time, appropriate 
data for making decisions relative to all phases. A phased contract may 
include stages of accomplishment such as research, development, and 
demonstration. Within each phase, there may be a number of tasks which 
should be included in the statement of work. When phases of work can be 
identified, the statement of work will provide for phasing and the 
request for proposals will require the submission of proposed costs by 
phases. The resultant contract will reflect costs by phases, require the

[[Page 35]]

contractor to identify incurred costs by phases, establish delivery 
schedules by phases, and require the written acceptance of each phase. 
The provisions of the Limitation of Cost clause shall apply to the 
estimated cost of each phase. Contractors shall not be allowed to incur 
costs for phases which are dependent upon successful completion of 
earlier phases until written acceptance of the prior work is obtained 
from the contracting officer.
    (4) Elements of the statement of work. The elements of the statement 
of work will vary with the objective, complexity, size, and nature of 
the acquisition. In general, it should cover the following matters as 
appropriate.
    (i) A general description of the required objectives and desired 
results. Initially, a broad, nontechnical statement of the nature of the 
work to be performed. This should summarize the actions to be performed 
by the contractor and the results that the Government expects.
    (ii) Background information helpful to a clear understanding of the 
requirements and how they evolved. Include a brief historical summary as 
appropriate. Include pertinent legislative history, related contracts or 
grants, and the relationship to overall program objectives.
    (iii) A detailed description of the technical requirements. A 
comprehensive description of the work to be performed to provide 
whatever details are necessary for prospective offerors to submit 
meaningful proposals.
    (iv) Subordinate tasks or types of work. A listing of the various 
tasks or types of work (it may be desirable in some cases to indicate 
that this is not all-inclusive). The degree of task breakout is directly 
dependent on the size and complexity of the work to be performed and the 
logical groupings. A single cohesive task should not be broken out 
merely to conform to a format. Indicate whether the tasks are sequential 
or concurrent for offeror planning purposes.
    (v) Phasing. When phasing is applicable, describe in detail the work 
or effort required in each phase and the criteria for determining 
whether the next phase will take place. If one or more phases contain 
subordinate tasks or types of work, the preceding information in 
paragraph (c)(4) (iv) may be incorporated into the part.
    (vi) Reference material. All reference material to be used in the 
conduct of the project, such as technical publications, reports, 
specifications, architect or engineering drawings, etc., that tell how 
the work is to be carried out must be identified. Applicability should 
be explained, and a statement made as to where the material can be 
obtained.
    (vii) Level of effort. When a level of effort is required, the 
number and type of personnel required should be stated. If known, the 
type and degree of expertise should be specified.
    (viii) Special requirements (as applicable). An unusual or special 
contractual requirement, which would impact on contract performance, 
should be included as a separate section. Such items could include 
required place(s) of performance or unusual travel requirements. 
Clearance requirements, such as forms clearance, should be addressed.
    (ix) Deliverables reporting requirements. All deliverables and/or 
reports must be clearly and completely described. For example, in a 
Final Study Report it is important to indicate what areas the report 
should cover and the criteria for use in accepting the final report to 
determine if the contract objectives have been satisfied. It is 
important to require the preparation and submission of progress reports 
(administrative, technical and financial) to reflect contractor 
certification of satisfactory progress. If possible, the reports should 
be coordinated in such a manner as to provide a correlation between 
costs incurred and the state of completion. All delivery and reporting 
requirements shall include the quantities, the place of delivery, and 
time of delivery.



307.170  Program training requirements.

    (a) Chapter 8-95 of the General Administration Manual (GAM) 
addresses the general parameters for acquisition planning as stated in 
307.104. In conjunction with the principles of proper acquisition 
planning, the Department has established training courses for program 
officials to promote expedient program management in the planning and 
other pertinent aspects of the acquisition process. Chapter 8-96 of the

[[Page 36]]

GAM sets forth specific training requirements for program officials as 
follows:
    (1) All program personnel selected to serve as project officer for 
an HHS contract shall have successfully completed either the 
Department's appropriate ``Base Project Officer'' course, or an 
equivalent course (see paragraph (b), below).
    (2) At least fifty percent of the HHS program personnel performing 
the function of technical proposal evaluator on a technical evaluation 
team or panel for any competitively solicited HHS contract shall have 
successfully completed the appropriate ``Basic Project Officer'' course, 
or an equivalent course (see paragraph (b), below). This requirement 
applies to the initial technical proposal evaluation and any subsequent 
technical evaluations that may be required.
    (b) Determination of course equivalency shall be made by the 
principal official responsible for acquisition of the cognizant 
contracting activity. The contracting officer is responsible for 
ensuring that the project officer and technical proposal evaluators have 
successfully completed the required training discussed in 307.170-2.
[49 FR 13969, Apr. 9, 1984, as amended at 56 FR 47002, Sept. 17, 1991]



307.170-1  Policy exceptions.

    (a) Small contracting activities. (1) Program personnel designated 
to serve as project officers and technical proposal evaluators for 
contracts which originate in offices having a mission which only 
incidentally and infrequently involves the generation of contract 
requirements (i.e., normally less than three contract requirements per 
fiscal year and in an amount not exceeding $100,000 per contract) are 
not required to have completed any of the referenced training courses, 
although completion of an appropriate ``Basic Project Officer'' course 
is recommended.
    (2) As a substitute for the training, contracting officers servicing 
these program offices are required to ensure, as a minimum, that program 
personnel designated to serve as project officers and technical proposal 
evaluators have read and studied the ``DHHS Project Officers' 
Contracting Handbook,'' and fully understand their responsibilities. The 
contracting officer shall require these program personnel to furnish 
written certification that they have fulfilled this requirement prior to 
discharging the duties of project officer or technical proposal 
evaluator.
    (b) Urgent requirements. In the event there is an urgent requirement 
for a specific individual to serve as a project officer and that 
individual has not successfully completed the prerequisite training 
course, the principal official responsible for acquisition may waive the 
training requirement and authorize the individual to perform the project 
duties, provided that:
    (1) The individual first meets with the cognizant contracting 
officer to review the ``DHHS Project Officers' Contracting Handbook,'' 
and to discuss the important aspects of the contracting--program office 
relationship as appropriate to the circumstances; and
    (2) The individual attends the next scheduled and appropriate 
``Basic Project Officer'' course.
[49 FR 13969, Apr. 9, 1984, as amended at 56 FR 47002, Sept. 17, 1991]



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.
    (2) Project officers with more than three years experience, and 
project officers with less than three years experience who have 
successfully completed the appropriate basic course, are qualified (and 
encouraged) to take the ``Advanced Project Officer'' course.
    (3) Additional information on prerequisites for attendance of these 
courses may be found in the ``DHHS Acquisition Training and 
Certification Program Handbook.''
    (b) Technical proposal evaluators. Technical proposal evaluators, 
regardless of experience, are required to take

[[Page 37]]

the appropriate ``Basic Project Officer'' course. Upon successful 
completion of the basic course, it is recommended that they take the 
appropriate ``Advanced Project Officer'' course.
[49 FR 13969, Apr. 4, 1984, as amended at 56 FR 47002, Sept. 17, 1991]



         Subpart 307.3--Contractor Versus Government Performance



307.302  General.

    (a) GAM Chapter 18-10, Commercial-Industrial Activities of the 
Department of Health and Human Services Providing Products or Services 
for Government Use, assigns responsibilities for making method-of-
performance decisions (contract vs. in-house performance) to various 
management levels within the Department depending on the dollar amount 
of capital investment or annual operating costs. It also requires that 
each operating division (OPDIV), staff division (STAFFDIV) and regional 
office (RO) designate a ``Commercial-Industrial Control Officer'' (CICO) 
to be responsible for ensuring compliance with the requirements of the 
Chapter.
    (d) Besides contracts with annual operating costs under $100,000, 
contracts under an authorized acquisition set-aside for small business 
or labor surplus area concerns and contracts made pursuant to section 
8(a) of the Small Business Act are exempted from the requirements of FAR 
Subpart 7.3, GAM Chapter 18-10, and OMB Circular No. A-76.



307.303  Determining availability of private commercial sources.

    In accordance with the provisions of GAM Chapter 18-10, OPDIVs, 
STAFFDIVs, and ROs and must prepare and maintain a complete inventory of 
all individual commercial or industrial activities, including those 
conducted under contracts in excess of $100,000 annually. They must also 
conduct periodic reviews of each activity and contract in the inventory 
to determine if the existing performance, in-house or by contract, 
continues to be in accordance with the policy guidelines of GAM Chapter 
18-10.



307.304  Procedures.

    Contracting officers shall ensure that no acquisition action 
involving a commercial-industrial activity is initiated unless it is in 
compliance with the requirements of GAM Chapter 18-10. The contracting 
officer must check each request for contract expected to result in a 
contract in excess of $100,000 to ensure that it contains a statement as 
to whether the proposed contract is or is not subject to review under 
GAM Chapter 18-10 requirements. If the contracting officer has any 
questions regarding the determination of applicability or 
nonapplicability, or if the required statement is missing, the program 
office submitting the request for contract should be contacted and the 
situation rectified. If the issue cannot be resolved with the program 
office, the contracting officer shall refer the matter to the CICO for a 
final determination. The principal official responsible for acquisition 
is responsible for ensuring that contracting activities are in full 
compliance with FAR Subpart 7.3.



307.307  Appeals.

    The review and appeals procedures discussed in FAR 7.307 are 
addressed in GAM Chapter 18-10.



     Subpart 307.70--Considerations in Selecting an Award Instrument



307.7000  Scope of subpart.

    This subpart provides guidance on the appropriate selection of award 
instruments consistent with the Federal Grant and Cooperative Agreement 
Act of 1977 (Pub. L. 95-224) and the OMB implementation of the Act as 
published in the Federal Register on August 18, 1978 (41 FR 36860). This 
subpart addresses acquisition relationships where the award instrument 
is the contract, and assistance relationships where the award instrument 
is either a grant or cooperative agreement.



307.7001  Applicability.

    This subpart applies to the choice of award instrument--contract, 
grant, or cooperative agreement--for all program and individual 
transactions, except where specifically prohibited by law.

[[Page 38]]



307.7002  Purpose.

    This subpart provides guidance to assist in the determination of 
whether to use the acquisition or assistance process to fulfill program 
needs. The distinction between, and use of, grants and cooperative 
agreements is not discussed in detail. Detailed guidance may be found in 
Chapter 1-02 of the Grants Administration Manual.



307.7003  Distinction between acquisition and assistance.

    (a) The Federal Grant and Cooperative Agreement Act of 1977 requires 
the use of contracts to acquire property or services for the direct 
benefit or use of the Government and grants or cooperative agreements to 
transfer money, property, services, or anything of value to recipients 
to accomplish a public purpose of support or stimulation authorized by 
Federal statute.
    (b) A contract is to be used as the legal instrument to reflect a 
relationship between the Federal Government and a recipient whenever:
    (1) The principal purpose of the instrument is the acquisition, by 
purchase, lease, or barter, of property or services for the direct 
benefit or use of the Federal Government; or
    (2) The Department determines in a specific instance that the use of 
a type of contract is appropriate. That is, it is determined in a 
certain situation that specific needs can be satisfied best by using the 
acquisition process. However, this authority does not permit 
circumventing the criteria for use of acquisition or assistance 
instruments. Use of this authority is restricted to extraordinary 
circumstances and only with the prior approval of the Director, Office 
of Acquisition and Grants Management.
    (c) A grant or cooperative agreement is to be used as the legal 
instrument to reflect a relationship between the Federal Government and 
a recipient whenever the principal purpose of the relationship is the 
transfer of money, property, services, or anything of value to the 
recipient to accomplish a public purpose of support or stimulation 
authorized by Federal statute.
    (1) A grant is the legal instrument to be used when no substantial 
involvement is anticipated between the Department and the recipient 
during performance of the contemplated activity.
    (2) A cooperative agreement is the legal instrument to be used when 
substantial involvement is anticipated between the Department and the 
recipient during performance of the contemplated activity.
    (d) As a general rule, contracts are to be used for the following 
purposes:
    (1) Evaluation (including research of an evaluative nature) of the 
performance of Government programs or projects or grantee activity 
initiated by the funding agency for its direct benefit or use.
    (2) Technical assistance rendered to the Government, or on behalf of 
the Government, to any third party, including those receiving grants or 
cooperative agreements.
    (3) Surveys, studies, and research which provide specific 
information desired by the Government for its direct activities, or for 
dissemination to the public.
    (4) Consulting services or professional services of all kinds if 
provided to the Government or, on behalf of the Government, to any third 
party.
    (5) Training projects where the Government selects the individuals 
or specific groups whose members are to be trained or specifies the 
content of the curriculum (not applicable to fellowship awards).
    (6) Planning for Government use.
    (7) Production of publications or audiovisual materials required 
primarily for the conduct of the direct operations of the Government.
    (8) Design or development of items for Government use or pursuant to 
agency definition or specifications.
    (9) Conferences conducted on behalf of the Government.
    (10) Generation of management information or other data for 
Government use.
    (e) As a general rule, grants or cooperative agreements are to be 
used for the following purposes:
    (1) General financial assistance (stimulation or support) to 
eligible recipients under specific legislation authorizing the 
assistance.

[[Page 39]]

    (2) Financial assistance (stimulation or support) to a specific 
program activity eligible for assistance under specific legislation 
authorizing the assistance.
[49 FR 13969, Apr. 9, 1984, as amended at 54 FR 24343, June 7, 1989]



307.7004  Procedures.

    (a) OPDIV, agency, and regional office program officials should use 
existing budget and program planning procedures to propose new 
activities and major changes in ongoing programs. It is the 
responsibility of these program officials to meet with the principal 
official responsible for acquisition and the principal grants management 
official, or their designees, to distinguish the relationships and 
determine whether award is to be made through the acquisition process or 
assistance process. This determination should be made prior to the time 
when the annual acquisition plan is reviewed and approved so that the 
plan will reflect all known proposed contract actions. The cognizant 
contracting officer will confirm the appropriateness of the use of the 
contract instrument when reviewing the request for contract.
    (b) Shifts from one award instrument to another must be fully 
documented in the appropriate files to show a fundamental change in 
program purpose that unequivocably justifies the rationale for the 
shift.
    (c) OPDIVs, agencies, and regional offices must ensure that the 
choice of instrument is determined in accordance with the Federal Grant 
and Cooperative Agreement Act of 1977 and applicable departmental 
policies. If, however, there are major individual transactions or 
programs which contain elements of both acquisition and assistance in 
such a way that they cannot be characterized as having a principal 
purpose of one or the other, guidance should be obtained from the 
Director, Office of Acquisition and Grants Management through normal 
channels, before proceeding with a determination.
    (d) Any public notice, program announcement, solicitation, or 
request for applications or proposals must indicate whether the intended 
relationship will be one of acquisition or assistance and specify the 
award instrument to be used.
[49 FR 13969, Apr. 9, 1984, as amended at 54 FR 24343, June 7, 1989]



   Subpart 307.71--Phase II Advance Acquisition Planning (Scheduling)



307.7101  Background.

    (a) Failure to properly plan individual acquisitions and failure to 
schedule the overall acquisition workload of an office, agency, or OPDIV 
tends to result in an inordinate percentage of contract awards being 
made in the closing weeks and even days of the fiscal year. This 
phenomenon, variously identified as ``The September Rush'', ``Hurry-up 
Spending'', ``End-of-Year Purchasing'', and ``Year-End Spending 
Abuses'', in turn fosters rushed, other than full and open competition, 
inadequately documented, and potentially wasteful acquisitions. 
Excessive year-end spending also invites increased intervention and/or 
scrutiny from Congress, the Office of Management and Budget, and the 
media. The end of the fiscal year, however, is usually too late to take 
corrective actions that are effective without being unduly damaging to 
necessary programs. The key is to begin advance acquisition planning far 
earlier.
    (b) To avoid the historic pattern of wasteful and unnecessary year-
end spending, the Department introduced the Acquisition Planning 
Initiative by Under Secretarial memorandum of February 19, 1980, 
Subject: New Procedures to Improve Planning and Scheduling of Contract 
Awards and Curb Last-Minute Year-End Procurement Spending. Phase II of 
this initiative, beginning with Fiscal Year 1981, established the 
present acquisition planning mechanism. Basic guidance on the Phase II 
mechanism is contained in the ASMB memorandum of March 28, 1980, 
Subject: Phase II of (Fiscal Year 1981) Procurement Planning 
Initiative--Guidelines for Program Funding Milestones. For the Public 
Health Service, the above guidance is supplemented by the ASMB 
memorandum of April 21,

[[Page 40]]

1982, Subject: Phase II Annual Procurement Planning.
[49 FR 13969, Apr. 9, 1984, as amended at 50 FR 23129, May 31, 1985; 50 
FR 38004, Sept. 19, 1985]



307.7102  Accountability and responsibility.

    Phase II is a Department-wide monitoring and accountability system 
that requires early planning of acquisition requirements down to the 
individual project level. The Phase II mechanism includes the following:
    (a) Accountability lies with the OPDIV and STAFFDIV heads who are 
required to coordinate overall schedules which plot the planned 
distribution of RFC deliveries and contract awards over an eighteen-
month timeline extending to fiscal year-end.
    (b) Each OPDIV and STAFFDIV retains the flexibility to schedule 
individual RFC deliveries and contract awards as desired, so long as the 
overall schedule presents a relatively even distribution of contract 
awards and workload across the fiscal year.
    (c) The schedules are updated quarterly to compare actual versus 
planned progress and, when necessary, to revise the schedules for the 
remainder of the fiscal year.
    (d) Project officers are responsible for initiating the project 
planning by coordinating with contracting activities prior to RFC 
preparation, and taking the lead in developing acquisition plans that 
establish the date(s) for delivering complete RFC packages to the 
contracting activity, and that establish the planned award dates for 
individual projects.
    (e) The Director, Office of Acquisition and Grants Management 
monitors the OPDIV and STAFFDIV Phase II plans throughout the year to 
assure that an even distribution of awards, dollar obligations, and 
workload is maintained.
[49 FR 13969, Apr. 9, 1984, as amended at 50 FR 23126, May 31, 1985; 50 
FR 38004, Sept. 19, 1985; 54 FR 24343, June 7, 1989]



307.7103  Purpose.

    The Phase II Advance Acquisition Planning mechanism serves to avoid 
excessive year-end spending and distributes the contract workload as 
evenly as possible over the fiscal year, and provides a mechanism for 
planning at the program/acquisition operational level and a management 
tool for monitoring at the program, OPDIV, and departmental levels.



307.7104  Contracting activity actions.

    The contracting activity shall take the following actions:
    (a) Advise program and staff personnel of their responsibilities to 
ensure that:
    (1) Year-end acquisitions of unplanned items are not entered into to 
use available balances of expiring appropriations (which would otherwise 
revert to the Treasury);
    (2) Orders for supplies, materials, and equipment are kept to the 
minimum needed to carry on approved programs;
    (3) Inventories are held to normal levels; and
    (4) New contracts for future services and payments to contractors 
are made only in accordance with established plans.
    (b) Determine closing dates for purchases to be made from 
appropriations ending on September 30.
    (c) Expedite the preparation and processing of determinations and 
findings which require the approval of the Assistant Secretary for 
Management and Budget or the OPDIV head.



PART 309--CONTRACTOR QUALIFICATIONS--Table of Contents




           Subpart 309.1--Responsible Prospective Contractors

Sec.
309.104  Standards.
309.104-1  General standards.
309.105  Procedures.
309.105-1  Obtaining information.

         Subpart 309.4--Debarment, Suspension, and Ineligibility

309.403  Definitions.
309.404  Parties excluded from procurement programs.
309.405  Effect of listing.
309.405-1  Continuation of current contracts.
309.406  Debarment.
309.406-3  Procedures.
309.407  Suspension.
309.407-3  Procedures.

[[Page 41]]

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:  49 FR 13976, Apr. 9, 1984, unless otherwise noted.



           Subpart 309.1--Responsible Prospective Contractors



309.104  Standards.



309.104-1  General standards.

    (a) In determining the adequacy of a prospective contractor's 
financial resources for the performance of the proposed contract, 
particular attention shall be given to the ability of the contractor to 
discharge its full financial responsibility for charges and losses of 
Government-furnished material, when the contractor has responsibility 
for such material.
    (e) The prospective contractor must have an established system of 
accounting and financial controls which are determined by the 
contracting officer to be adequate to permit the effective 
administration of the type of contract proposed, particularly if under 
its terms the costs incurred are a factor in determining the amount 
payable under the contract, or if advance or progress payments are 
requested.



309.105  Procedures.



309.105-1  Obtaining information.

    (b)(2)(ii) To ensure that a prospective contractor has the necessary 
accounting and operational controls (see 309.104-1(e)), a written 
determination must be made by the contracting officer that the 
prospective contractor has an adequate accounting system for determining 
costs applicable to the contract and a billing system that satisfies the 
contractual payment provisions. The determination must explain the basis 
for this judgment.
    (A) When dealing with high risk organizations, i.e., new 
organizations, those with known problems, and those with accounting 
system deficiencies, the contracting officer shall use every reasonable 
means available to protect the Government from the improper expenditure 
of Federal funds. Actions should include at least one of the following: 
preaward and postaward audits; direct identification of cost with 
deliverables; billing by contract phases or tasks; fidelity bonding or 
other guarantees by the parent company or principals of the 
organization; increased scrutiny of vouchers and financial reports; and 
frequent site visits to verify the incurrence of specific costs and the 
relationship of technical progress with the amount billed.
    (B) If a prospective contractor's accounting or billing system (or 
both) is determined to be inadequate, corrective action must be taken 
before that organization is awarded a contract. When corrective action 
cannot be completed until after the award and the contracting officer 
determines that the award must be made, the contracting officer shall 
consult with the cognizant cost advisor and take the appropriate actions 
set forth in FAR 16.104 to ensure that the Government's interests will 
be protected and the contract will be adequately costed and 
administered. Awards made under the preceding condition must be approved 
in writing by the principal official responsible for acquisition.



         Subpart 309.4--Debarment, Suspension, and Ineligibility

    Source:  50 FR 7780, Feb. 26, 1985, unless otherwise noted.



309.403  Definitions.

    Acquiring agency's head or a designee, as used in the FAR, shall 
mean, unless otherwise stated in this subpart, the head of the 
contracting activity. Acting in the capacity of the acquiring agency's 
head, the head of the contracting activity may make the required 
justifications or determinations, and take the necessary actions, 
specified in FAR Secs. 9.405, 9.406, and 9.407 for his or her respective 
activity, but only after obtaining the approval of the debarring or 
suspending official, as the case may be.
    Debarring official means the Assistant Secretary for Management and 
Budget, or his/her designee.

[[Page 42]]

    Initiating official means either the contracting officer, the head 
of the contracting activity, the Deputy Assistant Secretary for 
Management and Acquisition, or the Inspector General.
    Suspending official means the Assistant Secretary for Management and 
Budget, or his/her designee.
[50 FR 7780, Feb. 26, 1985, as amended at 54 FR 24343, June 7, 1989; 54 
FR 43965, Oct. 30, 1989]



309.404  Parties excluded from procurement programs.

    (c) The Office of Management and Acquisition (OMAC) shall perform 
the actions required by FAR 9.404(c).
    (4) OMAC shall maintain all documentation submitted by the 
initiating official recommending the debarment or suspension action and 
all correspondence and other pertinent documentation generated during 
the OMAC review.
[50 FR 7780, Feb. 26, 1985, as amended at 54 FR 24343, June 7, 1989; 54 
FR 43966, Oct. 30, 1989]



309.405  Effect of listing.

    (a) The head of the contracting activity may, with the concurrence 
of the debarring or suspending official, make the determinations 
referenced in FAR 9.405(a), regarding contracts for their respective 
activities.
    (1) If a contracting officer considers it necessary to award a 
contract, or consent to a subcontract with a debarred or suspended 
contractor, the contracting officer shall prepare a determination, 
including all pertinent documentation, and submit it through acquisition 
channels to the head of the contracting activity. The documentation must 
include the date by which approval is required and a compelling reason 
for the proposed action. Some examples of circumstances that may 
constitute a compelling reason for the award to, or consent to a 
subcontract with, a debarred or suspended contractor include:
    (i) The property or services to be acquired are available only from 
the listed contractor;
    (ii) The urgency of the requirement dictates that the Department 
deal with the listed contractor; or
    (iii) There are other compelling reasons which require business 
dealings with the listed contractor.
    (2) If the head of the contracting activity decides to approve the 
requested action, he/she shall request the concurrence of the debarring 
or suspending official and, if given, shall, in writing, inform the 
contracting officer of the decision within the required time period.



309.405-1  Continuation of current contracts.

    (a) Notwithstanding the debarment or suspension of a contractor, 
contracting officers may continue contracts or subcontracts in existence 
at the time the contractor was debarred or suspended, unless the head of 
the contracting activity or debarring or suspending official directs 
otherwise. A decision as to the type of termination action, if any, to 
be taken should be made only after review by the awarding activity's 
contracting and technical personnel. The contracting officer shall 
coordinate any termination with the Office of the General Counsel to 
ensure the propriety of the proposed action.
    (b) Contracting officers shall not renew the current contracts of 
debarred or suspended contractors, or otherwise extend their duration, 
unless the head of the contracting activity determines to do so, with 
the concurrence of the debarring or suspending official. The contracting 
officer shall prepare a determination meeting the requirements of 
309.405(a) and submit it, through acquisition channels, to the head of 
the contracting activity. If the head of the contracting activity agrees 
with the determination, he/she shall obtain the concurrence of the 
debarring or suspending official.



309.406  Debarment.



309.406-3  Procedures.

    (a) Investigation and referral. Whenever an apparent cause for 
debarment becomes known to an initiating official, that person shall 
prepare a report incorporating the information required by 309.470-2, if 
known, and forward it through appropriate channels, with a written 
recommendation, to the debarring official. Contracting officers shall

[[Page 43]]

forward their reports in accordance with 309.470-1. The debarring 
official shall initiate an investigation through such means as he/she 
deems appropriate.
    (b) Decisionmaking process. The debarring official shall review the 
results of the investigation, if any, and make a written determination 
whether or not debarment procedures are to be commenced. A copy of the 
determination shall be promptly sent through appropriate channels to the 
initiating official, and the contracting officer, if necessary. If the 
debarring official determines to commence debarment procedures, he/she 
shall, after consultation with the Office of the General Counsel, notify 
the contractor in accordance with FAR 9.406-3(c). If the proposed action 
is not based on a conviction or judgment and the contractor's submission 
in response to the notice raises a genuine dispute over facts material 
to the proposed debarment, the debarring official shall arrange for 
fact-finding hearings and take the necessary actions specified in FAR 
9.406-3(b)(2). The debarring official shall also ensure that written 
findings of fact are prepared, and shall base the debarment decision on 
the facts as found, after considering information and argument submitted 
by the contractor and any other information in the administrative 
record. The Office of the General Counsel shall represent the Department 
at any fact-finding hearing and may present witnesses for HHS and 
question any witnesses presented by the contractor.



309.407  Suspension.



309.407-3  Procedures.

    (a) Investigation and referral. Whenever an apparent cause for 
suspension becomes known to an initiating official, that person shall 
prepare a report incorporating the information required by 309.470-2, if 
known, and forward it through appropriate channels, with a written 
recommendation, to the suspending official. Contracting officers shall 
forward their reports in accordance with 309.470-1. The suspending 
official shall initiate an investigation through such means as he/she 
deems appropriate.
    (b) Decisionmaking process. The suspending official shall review the 
results of the investigation, if any, and make a written determination 
whether or not suspension should be imposed. A copy of this 
determination shall be promptly sent through appropriate channels to the 
initiating official and the contracting officer, if necessary. If the 
suspending official determines to impose suspension, he/she shall, after 
consultation with the Office of the General Counsel, notify the 
contractor in accordance with FAR 9.407-3(c). If the action is not based 
on an indictment and, subject to the provisions of FAR 9.407-3(b)(2), 
the contractor's submission in response to the notice raises a genuine 
dispute over facts material to the suspension, the suspending official 
shall, after suspension has been imposed, arrange for fact-finding 
hearings and take the necessary actions specified in FAR 9.407-3(b)(2).



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 the OMAC 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 regulation, 
or any other comparable regulation, by changes of address, multiple 
addresses, formation of new companies, or by other devices.
[50 FR 7780, Feb. 26, 1985, as amended at 54 FR 24343, June 7, 1989]



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.

[[Page 44]]

    (c) All known affiliates, subsidiaries, or parent firms, and the 
nature of the affiliation.
    (d) Description of the contract or contracts concerned, including 
the contract number, and office identifying numbers or symbols, the 
amount of each contract, the amount paid the contractor and the amount 
still due, and the percentage of work completed and to be completed.
    (e) The status of vouchers.
    (f) Whether contract funds have been assigned pursuant to the 
Assignment of Claims Act, as amended, 31 U.S.C. 3727, 41 U.S.C. 15, and, 
if so assigned, the name and address of the assignee and a copy of the 
assignment.
    (g) Whether any other contracts are outstanding with the contractor 
or any affiliates, and, if so, the amount of such contracts, whether 
these funds have been assigned pursuant to the Assignment of Claims Act, 
as amended, 31 U.S.C. 3727, 41 U.S.C. 15, and the amounts paid or due on 
such contracts.
    (h) A complete summary of all available pertinent evidence.
    (i) A recommendation as to the continuation of current contracts.
    (j) An estimate of damages, if any, sustained by the Government as a 
result of the action of the contractor, including an explanation of the 
method used in making the estimate.
    (k) The comments and recommendations of the contracting officer and 
statements regarding whether the contractor should be suspended or 
debarred, whether any limitations should be applied to such action, and 
the period of any proposed debarment.
    (l) As an enclosure, a copy of the contract(s) or pertinent excerpts 
therefrom, appropriate exhibits, testimony or statements of witnesses, 
copies of assignments, and other relevant documentation or a written 
summary of any information for which documentation is not available.

[[Page 45]]



          SUBCHAPTER C--CONTRACTING METHODS AND CONTRACT TYPES





PART 313--SMALL PURCHASE AND OTHER SIMPLIFIED PURCHASE PROCEDURES--Table of Contents




                         Subpart 313.1--General

Sec.
313.101  Definitions.
313.104  Procedures.
313.105  Small business--small purchase set-aside.
313.106  Competition and price reasonableness.
313.107  Solicitation and evaluation of quotations.

               Subpart 313.2--Blanket Purchase Agreements

313.201  General.
313.204  Purchases under Blanket Purchase Agreements.

                       Subpart 313.4--Imprest Fund

313.403  Agency responsibilities.

                     Subpart 313.5--Purchase Orders

313.505  Purchase order and related forms.
313.505-3  Standard Form 44, Purchase Order--Invoice--Voucher.

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

    Source:  49 FR 13977, Apr. 9, 1984, unless otherwise noted.



                         Subpart 313.1--General



313.101  Definitions.

    ``Small purchase procedures''
    (d) Acquisition of architect-engineer professional services of any 
dollar amount.



313.104  Procedures.

    (i) Small purchase methods are designed to acquire defined, off-the-
shelf, standard supplies, equipment, or services which may be awarded on 
the basis of a fixed price quotation. Small purchase methods should not 
be used to acquire R & D, complex studies, services, and the like (which 
require judgmental technical evaluations and involve negotiations) where 
the award cannot be confidently made on the low price. Where 
requirements are not suitable for accomplishment using small purchase 
methods, more formal negotiation methods or sealed bidding should be 
used.
    (j) Small purchases accomplished in accordance with this part may 
not be awarded on a cost-reimbursement basis.
    (k) Small purchase methods should be used with great prudence for 
the acquisition of consultants to avoid the increased possibility of 
using consultants in an improper personal services capacity.
[49 FR 13977, Apr. 9, 1984, as amended at 50 FR 23129, May 31, 1985; 50 
FR 38004, Sept. 19, 1985; 53 FR 15563, May 2, 1988]



313.105  Small business-small purchase set-aside.

    (d) (2) The contracting officer shall consult with the small and 
disadvantaged business utilization specialist (SADBUS) to determine 
whether small business sources are known by the SADBUS before 
determining not to proceed with the small business-small purchase set-
aside. Coordination with the SADBUS is not required for small purchases 
at or below ten percent of the small purchase limitation.
[57 FR 11689, Apr. 7, 1992]



313.106  Competition and price reasonableness.

    (a) Purchases not over 10 percent of the small purchase limitation. 
Purchases not exceeding this limit are exempt from the documentary 
requirements of FAR Subpart 6.3 and Subpart 306.3. However, purchases 
shall not be made repetitively from one source except for reasons which 
clearly and convincingly justify other than full and open competition 
(see FAR Subpart 6.3).
    (b) Purchases over 10 percent of the small purchase limitation.
    (4)(i)(D) Women-owned small business.
    (c) Data to support small purchases over 10 percent of the small 
purchase limitation.

[[Page 46]]

    (2) Purchases ranging in excess of 10 percent of the small purchase 
limitation up to and including the small purchase limitation which are 
made without full and open competition require justification as to why 
competition was not obtained. The justification, which may be in the 
form of a paragraph or paragraphs in the request for contract or 
requisition, must address the considerations in FAR Subpart 6.3 and 
Subpart 306.3. The contracting officer may approve or disapprove the 
justification. Award of the contract or purchase order by the 
contracting officer shall constitute approval of the justification (see 
306.304(a)(1)).
[49 FR 13977, Apr. 9, 1984, as amended at 50 FR 23129, May 31, 1985; 50 
FR 38004, Sept. 19, 1985; 56 FR 47002, Sept. 17, 1991]



313.107  Solicitation and evaluation of quotations.

    (e) Amendments. (1) If after the issuance of a request for 
quotations but before the closing date of their receipt, it becomes 
necessary (i) to make significant changes in the quantity, 
specifications, or delivery schedule, (ii) to make any change in the 
closing date, or (iii) to correct a defect or ambiguity, the change 
shall be accomplished by issuance of an amendment to the request. 
Requests for quotations using the Standard Form 18 may be amended by 
letter. Oral requests for quotations may be amended orally.
    (2) When it is considered necessary to issue an amendment to a 
request for quotations, the period of time remaining before closing and 
the need for extending this period by postponing the time set for 
closing must be considered. Where only a short time remains before the 
time set for closing, extension of time may be made by telegram or 
telephone. This notification should be confirmed in the amendment.
    (3) Any information given to one potential quoter concerning a 
request for quotations shall be furnished promptly to all other 
potential quoters in an amendment to the request, if the information is 
necessary to potential quoters in submitting quotations, or if the lack 
of the information would be prejudicial to uninformed potential quoters.
[49 FR 13977, Apr. 9, 1984, as amended at 49 FR 36110, Sept. 14, 1984; 
56 FR 47003, Sept. 17, 1991]



               Subpart 313.2--Blanket Purchase Agreements



313.201  General.

    (e) Each blanket purchase arrangement (BPA) shall be documented by 
issuance of a contractual instrument which is appropriately numbered.



313.204  Purchases under Blanket Purchase Agreements.

    (e)(5) Delivery documents, invoices, etc. signed by the Government 
employee receiving the item or service, will be forwarded to the fiscal 
office or other paying office as designated by the OPDIV. Payment will 
be made on the basis of the signed document, invoice, etc. Contracting 
offices will ensure that established procedures allowing for 
availability of funds are in effect prior to placement of orders.
[49 FR 13977, Apr. 9, 1984, as amended at 56 FR 47003, Sept. 17, 1991]



                       Subpart 313.4--Imprest Fund



313.403  Agency responsibilities.

    (a) The amount of each imprest fund shall be established on the 
basis of the estimated monthly payment and the need for replenishment. A 
review shall be made by the responsible official at least quarterly to 
insure that the fund is not in excess of needs, and appropriate 
adjustments are made accordingly.
    (c) Requests to establish imprest funds shall be made to the 
responsible fiscal office. At larger activities where the cashier may 
not be conveniently located near the purchasing office, a Class C 
Cashier may be installed in the purchasing office. Documentation of cash 
purchases shall be in accordance with instructions contained in the HHS 
Voucher Audit Manual Part 1, Chapter 1-10.

[[Page 47]]



                     Subpart 313.5--Purchase Orders



13.505  Purchase order and related forms.



313.505-3  Standard Form 44, Purchase Order--Invoice--Voucher.

    (d) Since the Standard Form 44 is an accountable form, a record 
shall be maintained of serial numbers of the form, to whom issued, and 
date issued. SF-44's shall be kept under adequate lock and key to 
prevent unauthorized use. A reservation of funds shall be established to 
cover total anticipated expenditures prior to use of the SF-44.



PART 314--FORMAL ADVERTISING--Table of Contents




                   Subpart 314.2--Solicitation of Bids

Sec.
314.202-7  Facsimile bids.
314.213  Annual submission of representations and certifications.

          Subpart 314.4--Opening of Bids and Award of Contract

314.404  Rejection of bids.
314.404-1  Cancellation of invitations after opening.
314.406  Mistakes in bids.
314.406-3  Other mistakes disclosed before award.
314.406-4  Mistakes after award.
314.407  Award.
314.407-8  Protests against award.

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



                   Subpart 314.2--Solicitation of Bids

    Source:  55 FR 13536, Apr. 11, 1990, unless otherwise noted.



314.202-7  Facsimile bids.

    The principal official responsible for acquisition (PORA) shall 
determine whether to allow the use of facsimile bids. If the PORA 
decides to allow the use of facsimile bids, internal procedures shall be 
developed, in accordance with the FAR, to ensure uniform processing and 
control.



314.213  Annual submission of representations and certifications.

    Each principal official responsible for acquisition (PORA) shall 
determine whether to allow the use of the annual submission of 
representations and certifications by bidders. If allowed, the 
provisions of FAR 14.213 shall be followed.



          Subpart 314.4--Opening of Bids and Award of Contract



314.404  Rejection of bids.



314.404-1  Cancellation of invitations after opening.

    (c) The chief of the contracting office (CCO) shall make the 
determination required by FAR 14.404-1(c).
    (e) The CCO shall make the referenced determination.
[51 FR 44294, Dec. 9, 1986]



314.406  Mistakes in bids.



314.406-3  Other mistakes disclosed before award.

    (e) Authority has been delegated to the Protest Control Officer, 
Division of Acquisition Policy, Office of Acquisition and Grants 
Management (OAGM) to make administrative determinations in connection 
with mistakes in bid alleged after opening and before award. This 
authority may not be redelegated.
    (f) Each proposed determination shall have the concurrence of the 
Chief, Business Law Branch, Business and Administrative Law Division, 
Office of General Counsel.
    (g)(3) The data required by FAR 14.406-3(g)(3) shall be marked 
``IMMEDIATE ACTION--MISTAKE IN BID'' and submitted through acquisition 
channels to the Protest Control Officer, Division of Acquisition Policy, 
Office of Acquisition and Grants Management (OAGM). The file shall be 
assembled in an orderly manner and shall include an index of enclosures. 
A single copy of the file is sufficient.
    (4) Since examination of evidence is necessary to determine the 
proper course of action to be taken, no action will be taken on cases 
referred by telephone or telegraph.
    (5) Where the evidence submitted by the bidder is incomplete or in 
need of clarification, the contracting officer shall document the file 
to indicate the effort made to obtain clear and convincing evidence to 
support the alleged mistake. Since the burden of providing

[[Page 48]]

such evidence lies with the bidder-claimant, repeated efforts to obtain 
such information are neither necessary nor desirable.
    (i) Doubtful cases shall not be submitted by the contracting officer 
directly to the Comptroller General, but shall be submitted as indicated 
in 314.406-3(g)(3).
[49 FR 13978, Apr. 9, 1984, as amended at 50 FR 23126, May 31, 1985; 50 
FR 38004, Sept. 19, 1985; 54 FR 24343, June 7, 1989]



314.406-4  Mistakes after award.

    (c) Authority has been delegated to the Protest Control Officer, 
Division of Acquisition Policy, OAGM to make administrative 
determinations in connection with mistakes in bid alleged after award. 
This authority may not be redelegated.
    (d) Each proposed determination shall have the concurrence of the 
Chief, Business Law Branch, Business and Administrative Law Division, 
Office of General Counsel.
    (2) The data required by FAR 14.406-4(e)(2) shall be marked 
``IMMEDIATE ACTION--MISTAKE IN BID'' and submitted as prescribed in 
314.406-3(g)(3).
[49 FR 13978, Apr. 9, 1984, as amended at 50 FR 23126, May 31, 1985; 50 
FR 38004, Sept. 19, 1985; 54 FR 24343, June 7, 1989]



314.407  Award.



314.407-8  Protests against award.

    See Subpart 333.1--Protests.
[50 FR 23129, May 31, 1985, and 50 FR 38004, Sept. 19, 1985]



PART 315--CONTRACTING BY NEGOTIATION--Table of Contents




           Subpart 315.1--General Requirements for Negotiation

Sec.
315.103  Converting from sealed bidding to negotiation procedures.

   Subpart 315.4--Solicitation and Receipt of Proposals and Quotations

315.402  General.
315.404  Presolicitation notices and conferences.
315.405  Solicitations for information or planning purposes.
315.405-1  General.
315.406  Preparing requests for proposals (RFP's) and requests for 
          quotations (RFQ's).
315.406-1  Uniform contract format.
315.406-2  Part I--The Schedule.
315.406-3  Part II--Contract clauses.
315.406-5  Part IV--Representations and instructions.
315.407  Solicitation provisions.
315.408  Issuing solicitations.
315.409  Pre-proposal conferences.
315.410  Amendment of solicitations before closing date.
315.413  Disclosure and use of information before award.
315.413-1  Alternate I.
315.413-2  Alternate II.
315.470  Review of RFP.
315.471  Annual submission of representations and certifications.

                  Subpart 315.5--Unsolicited Proposals

315.505  Content of unsolicited proposals.
315.506  Agency procedures.
315.506-1  Receipt and initial review.
315.509  Limited use of data.

                     Subpart 315.6--Source Selection

315.602  Applicability.
315.604  Responsibilities.
315.605  Evaluation factors.
315.607  Disclosure of mistakes before award.
315.608  Proposal evaluation.
315.608-70  Technical evaluation plan.
315.608-71  Technical evaluation panel.
315.608-72  Procedures for handling and disclosing proposals.
315.608-73  Receipt of proposals.
315.608-74  Convening the technical evaluation panel.
315.608-75  Rating and ranking of proposals.
315.608-76  Technical evaluation report.
315.608-77  Evaluation of business proposals.
315.609  Competitive range.
315.610  Written or oral discussions.
315.611  Best and final offers.
315.670  Negotiation with the selected source.
315.671  Post negotiation contract preparation and award.
315.672  Preparation of negotiation memorandum.

                    Subpart 315.8--Price Negotiation

315.804  Cost or pricing data.
315.804-3  Exemptions from or waiver of submission of certified cost or 
          pricing data.
315.805  Proposal analysis.
315.805-5  Field pricing support.

                          Subpart 315.9--Profit

315.900  Scope of subpart.
315.905-70  Structured approach.
315.905-71  Profit factors.

[[Page 49]]

315.905-72  Contractor effort.
315.905-73  Other factors.
315.905-74  Facilities capital cost of money.

Subpart 315.10--Preaward, Award, and Postaward Notifications, Protests, 
                              and Mistakes

315.1000  General.
315.1003  Debriefing of unsuccessful offerors.
315.1004  Protests against award.
315.1005  Discovery of mistakes.

                  Subpart 315.70--Requests for Contract

315.7000  Scope of subpart.
315.7001  General.
315.7002  Procedures.
315.7003  Responsibilities.
315.7004  Transmittal.
315.7005  Format and content.
315.7006  Review.

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

    Source:  49 FR 13979, Apr. 9, 1984, unless otherwise noted.



           Subpart 315.1--General Requirements for Negotiation



315.103  Converting from sealed bidding to negotiation procedures.

    The chief of the contracting office has the authority to make the 
determination referenced in FAR 15.103.
[51 FR 44294, Dec. 9, 1986]



   Subpart 315.4--Solicitation and Receipt of Proposals and Quotations



315.402  General.

    (i) The principal official responsible for acquisition (PORA) shall 
determine whether to allow the use of facsimile proposals. If the PORA 
decides to allow the use of facsimile proposals, internal procedures 
shall be developed, in accordance with the FAR, to ensure uniform 
processing and control.
[55 FR 13536, Apr. 11, 1990]



315.404  Presolicitation notices and conferences.

    (c) Presolicitation conferences. (1) The presolicitation conference 
may only be used when approved by the chief of the contracting office.



315.405  Solicitations for information or planning purposes.



315.405-1  General.

    The determination approval required by FAR 15.405-1 that a 
solicitation for information or planning purposes is appropriate shall 
be made by the chief of the contracting office.



315.406  Preparing requests for proposals (RFP's) and requests for quotations (RFQ's).

    (a) The contracting officer is responsible for preparing the RFP 
with the assistance of the project officer. The purpose of the RFP is to 
convey information that prospective offerors need to prepare a proposal. 
The RFP includes the statement of work and the terms, conditions and 
provisions that will form the basis for the final definitive contract. 
It specifies all the information that prospective offerors must furnish 
to permit a meaningful and equitable evaluation of their offers. The RFP 
must be clear, complete, accurate, and consistent with the requirements 
of the acquisition so that it provides all who receive it with the same 
understanding of the requirements. Much of the information in the RFP is 
either derived directly from the request for contract or is otherwise 
furnished by the project officer. Therefore, it is important that the 
project officer develop a meaningful request for contract and supporting 
documentation during the initial presolicitation phase which will fully 
satisfy program needs and objectives when included in the RFP (see 
Subpart 315.70).
    (b) Careful drafting of the RFP is vital to the proper working of 
the competitive process. The success of the acquisition depends, in 
large measure, on how well the work to be performed and the basic ground 
rules under which the competition will be conducted are described in the 
RFP. Particular effort must be made to develop a comprehensive and 
accurate statement of work (see 307.105-3 and FAR 35.007) to prevent 
ambiguities and to avoid misunderstandings which might otherwise surface 
at later stages of the acquisition.
    (c) Care should be taken to avoid conflicting statements in the RFP. 
Clear

[[Page 50]]

distinctions must be made as to the contents and purpose of the 
statement of work, the instructions to offerors, and the evaluation 
criteria. Briefly:
    (1) The statement of work must clearly specify the work to be done 
by the resultant contractor (or, if it is an R & D acquisition, present 
a clear statement of the requirements, see FAR Part 35);
    (2) The general, technical, and business instructions must delineate 
all the essential information prospective offerors need to know in 
preparing their proposals (see 315.406-5(b)); and
    (3) The evaluation criteria must clearly indicate the technical, 
management, personnel, and cost or pricing factors which are to be the 
major considerations in selecting the successful offeror (see 315.406-
5(c)).
    (d) The RFP must require that proposals be submitted in two parts--a 
``Technical Proposal'' and a ``Business Proposal.'' Each part is to be 
separate and complete in itself so that evaluation of one may be 
accomplished independently of the other.
    (e) The technical and business proposal instructions of the RFP must 
provide all the information deemed essential for proper evaluation of 
the proposals so that all prospective offerors are aware of all 
requirements, and so that differences in proposals will reflect each 
offeror's individual approach to the clear and unambiguous requirements 
and criteria stated in the RFP.
    (f) The RFP must inform prospective offerors of all evaluation 
criteria and of the relative importance or weight attached to each 
criterion. Evaluation criteria must be described sufficiently enough in 
the RFP to inform prospective offerors of the significant matters which 
should be addressed in the proposals. Only the evaluation criteria set 
forth in the RFP shall be used in the evaluation of proposals, and the 
criteria can only be modified by a formal amendment to the RFP.
    (g) Generally, the RFP will provide that the technical proposal not 
contain any reference to cost. However, resource information, such as 
data concerning labor hours and categories, materials, subcontracts, 
travel, computer time, etc., must be included in the technical proposal 
so that the offeror's understanding of the scope of work may be 
evaluated.
    (h) The project officer should be offered the opportunity to review 
the finalized RFP before it is printed and released.



315.406-1  Uniform contract format.

    The uniform contract format specified in FAR 15.406-1 and Table 15-1 
shall be used by all contracting activities of the Department.
[49 FR 13979, Apr. 9, 1984, as amended at 50 FR 23129, May 31, 1985; 50 
FR 38004, Sept. 19, 1985]



315.406-2  Part I--The Schedule.

    (a) Section A, Solicitation/contract form.
    (3) Contracting activities are encouraged to use SF 33 for RFPs. In 
those instances where a contracting activity believes the SF 33 is not 
appropriate, a transmittal letter may be used. However, it is essential 
that the transmittal letter contain the pertinent information that must 
be brought to the attention of prospective offerors, so the information 
contained in FAR 15.406-2(a)(3) shall be included in it. The transmittal 
letter should also contain reference to the solicitation provision 
``Late Submissions, Modifications, and Withdrawals of Proposals or 
Quotations'' and stress the importance of timeliness. The last paragraph 
of the transmittal letter should provide the name and complete telephone 
number of a contract specialist who can provide information concerning 
the solicitation.
[49 FR 13979, Apr. 9, 1984, as amended 54 FR 24343, June 7, 1989]



315.406-3  Part II--Contract clauses.

    Section I, Contract clauses.
    This section should contain all the pertinent contract clauses 
applicable to the acquisition, to include those contained in the general 
provisions, any additions or modifications to the general provisions, 
and special contract clauses (see Part 352--Solicitation Provisions and 
Contract Clauses).

[[Page 51]]



315.406-5  Part IV--Representations and instructions.

    (a) Section K, Representations, certifications, and other statements 
of offerors or quoters.
    (1) This section shall begin with the following statements and 
continue with the applicable representations and certifications:

    To Be Completed by the Offeror: (The Representations and 
Certifications must be executed by an individual authorized to bind the 
offeror.)
    The offeror makes the following Representations and Certifications 
as part of its proposal (check or complete all appropriate boxes or 
blanks on the following pages).

Name of offeror --------

RFP No. ------

Signature of authorized individual --------

Date ------

Type name of authorized individual --------

    Note:  The penalty for making false statements in offers is 
prescribed in 18 U.S.C. 1001.

    (2) The contracting officer shall insert in all solicitations the 
representations and certifications at--
    (i) FAR 52.203-2, Certificate of Independent Price Determination;
    (ii) FAR 52.203-4, Contingent Fee Representation and Agreement;
    (iii) FAR 52.204-3, Taxpayer Identification;
    (iv) FAR 52.209-5, Certification Regarding Debarment, Suspension, 
Proposed Debarment, and Other Responsibility Matters;
    (v) FAR 52.215-6, Type of Business Organization;
    (vi) FAR 52.215-20, Place of Performance;
    (vii) FAR 52.219-1, Small Business Concern Representation;
    (viii) FAR 52.219-2, Small Disadvantaged Business Concern 
Representation;
    (ix) FAR 52.219-3, Women-Owned Small Business Representation;
    (x) FAR 52.222-19, Walsh-Healy Public Contracts Act Representation;
    (xi) FAR 52.222-21, Certification of Nonsegregated Facilities;
    (xii) FAR 52.222-22, Previous Contracts and Compliance Reports;
    (xiii) FAR 52.222-25, Affirmative Action Compliance;
    (xiv) FAR 52.223-1, Clean Air and Water Certification;
    (xv) FAR 52.223-5, Certification Regarding a Drug-Free Workplace;
    (xvi) FAR 52.225-1, Buy American Certification;
    (xvii) FAR 52.225-12, Notice of Restrictions on Contracting With 
Sanctioned Persons;
    (xviii) FAR 52.230-2, Cost Accounting Standards Notices and 
Certification (Nondefense); and
    (xix) FAR 15.804-4, Certificate of Current Cost or Pricing Data; and

    Note:  The following paragraph shall be inserted between the title 
and text of this certificate:

    (When a certificate of cost or pricing data is required to be 
submitted in accordance with Federal Acquisition Regulation (FAR) 
15.804-4, the Contracting Officer will request that the offeror 
complete, execute, and submit to the Contracting Officer a certification 
in the format shown in the following Certificate of Current Cost or 
Pricing Data. The certification shall be submitted only at the time 
negotiations are concluded. Offerors should complete the certificate set 
forth below and return it when requested by the Contracting Officer.)

    (xx) 352.215-71, Employer's Identification Number.
    (b) Section L, Instructions, conditions, and notices to offerors and 
quoters. This section shall be comprised of the general instructions, 
technical proposal instructions, and business proposal instructions, as 
well as pertinent solicitation provisions (see FAR 15.407).
    (1) General instructions.
    (i) The general instructions provide basic guidance to prospective 
offerors that informs them of what is required in the preparation and 
submission of proposals. The general instructions must include the 
following statements and any instructions pertinent to the individual 
acquisition and applicable requirements of the OPDIV, agency, or 
regional office.

                          General Instructions

    The following instructions establish the acceptable minimum 
requirements for the format and content of proposals:
    Your special attention is directed to the requirements for technical 
and business proposals to be submitted in accordance with these 
instructions.
    Any resultant contract shall include the general provisions 
applicable to the selected offeror's organization and type of contract 
awarded. Copies of general provisions may be

[[Page 52]]

obtained by contacting the contracting officer. Any additional clauses 
required by public law, executive order, or acquisition regulations, in 
effect at the time of execution of the proposed contract, will be 
included.
    The proposal must be prepared in two parts: a ``Technical Proposal'' 
and a ``Business Proposal.'' Each of the parts shall be separate and 
complete in itself so that evaluation of one may be accomplished 
independently of evaluation of the other. The technical proposal must 
not contain reference to cost; however, resource information, such as 
data concerning labor hours and categories, materials, subcontracts, 
etc., must be contained in the technical proposal so that your 
understanding of the scope of the work may be evaluated. It must 
disclose your technical approach in sufficient detail to provide a clear 
and concise presentation that includes, but is not limited to, the 
requirements of the technical proposal instructions.
    The proposal must be signed by an official authorized to bind your 
organization. (Number) copies of your technical proposal and (number) 
copies of your business proposal must be submitted to: (Insert complete 
address indicating where the proposal is to be sent and how it is to be 
marked. Provide similar information for hand-delivered proposals.)
    You may, at your discretion, submit alternate proposals, or 
proposals which deviate from the requirements; provided, that you also 
submit a proposal for performance of the work as specified in the 
statement of work. These proposals may be considered if overall 
performance would be improved or not compromised, and if they are in the 
best interest of the Government. Alternate proposals, or deviations from 
any requirements of this RFP, must be clearly identified.
    The Government will evaluate proposals in accordance with the 
evaluation criteria set forth in Section M of this request for 
proposals.
    It is understood that your proposal will become part of the official 
contract file.
    The RFP does not commit the Government to pay any cost for the 
preparation and submission of a proposal. In addition, the Contracting 
Officer is the only individual who can legally commit the Government to 
the expenditure of public funds in connection with this proposed 
acquisition.

    (ii) Include either of the following in the General Instructions if 
prospective offerors are to be informed of the Government's estimate of 
the level of effort necessary to accomplish the requirement:

    The Government considers the level of effort to perform the 
resultant contract should take the following staff-hours: (insert a 
breakdown of the Government's staff-hour estimates by categories). These 
estimates are furnished for the offeror's information only and are not 
to be considered restrictive for proposal purposes; or
    To assist you in the preparation of your proposal, the Government 
considers the effort to perform this contract to be approximately 
(insert the total number) staff-hours. This number is furnished for the 
offeror's information only and is not considered restrictive for 
proposal purposes.

    Note:  The first paragraph should only be used for term (e.g. level 
of effort task order), rather than completion type, contracts.)

    (iii) If the proposed contract will involve performance or services 
on a Government installation, insert the following in the General 
Instructions:

    Offerors are urged and expected to inspect the site where services 
are to be performed and to satisfy themselves as to all general and 
local conditions that may affect the cost of performance of the 
contract, to the extent such information is reasonably obtainable. In no 
event will failure to inspect the site constitute grounds for claims by 
the contractor after the award of a contract.

    (iv) If reference material is to be provided for use in preparation 
of proposals, insert either of the following:

    To assist offerors in preparing their proposals, reference material 
consisting of (insert title or description of publications, 
specifications, drawings, reports, or other documentation being made 
available as reference material) will be available for inspection at 
(insert name and address of building and room number).
    Offerors are expected to examine all reference material prior to 
preparation and submission of their proposals. Failure to do so will be 
at the offeror's risk; or
    To assist offerors in preparing their proposals, reference material 
consisting of (insert title or description of publications, 
specifications, drawings, reports, or other documentation being 
furnished as reference material) is enclosed. Offerors are expected to 
examine all reference material prior to preparation and submission of 
their proposal. Failure to do so will be at the offeror's risk.

    (v) If the reference material being provided is to be returned to 
the Government, include the following statement:

    All reference material furnished hereunder shall be returned within 
(insert number) days after the submission of proposals to (insert name 
and address of building and room number).


[[Page 53]]


    (vi) If an incentive type contract is being considered, a notice to 
the offeror of the Government's desire as to use of incentives 
considered applicable, objectives of the incentive performance goals, 
schedules, milestones, critical delivery parameters, and similar 
information must be included.
    (2) Technical proposal instructions.
    (i) The technical proposal instructions should clearly and concisely 
describe the information prospective offerors must provide in their 
technical proposals. The instructions should address the need for 
submission of a detailed work plan indicating how each aspect of the 
statement of work is to be accomplished, a discussion of how the work is 
to be organized, staffed, and managed, and statements of the 
qualifications and experience of the prospective offeror and its key 
personnel.
    (ii) The technical proposal instructions must be specific enough to 
convey the information the program office will require from offerors to 
allow the technical proposal evaluators to determine whether a proposal 
is acceptable. Therefore, it is essential that the instructions are 
written to elicit the information necessary to fully address all the 
elements of the work plan with particular emphasis on the evaluation 
criteria, so that evaluators may readily evaluate each offer in the 
pertinent areas. The instructions should not require the submission of 
excessive information since this will complicate the evaluation process 
and could cause unnecessary proposal preparation costs for offerors.
    (iii) The technical proposal instructions should require that 
technical proposals be prepared in a specified format to facilitate 
evaluation. A uniform format will minimize evaluators' efforts and 
should minimize the amount of extraneous and voluminous material 
sometimes included in proposals.
    (iv) Since specific instructions must be developed to suit the needs 
of the individual acquisition, detailed guidance concerning the contents 
of the technical proposal instructions is not presented here. However, 
the following represents a sampling of general statements which may be 
helpful in the preparation of the instructions:

                     Technical Proposal Instructions

    Proposals which merely offer to conduct a program in accordance with 
the requirements of the Government's scope of work will not be eligible 
for award. You must submit an explanation of the proposed technical 
approach in conjunction with the tasks to be performed in achieving the 
project objectives.
    A detailed work plan must be submitted indicating how each aspect of 
the statement of work is to be accomplished. Your technical approach 
should be in as much detail as you consider necessary to fully explain 
your proposed technical approach or method. The technical proposal 
should reflect a clear understanding of the nature of the work being 
undertaken.
    The technical proposal must include information on how the project 
is to be organized, staffed, and managed. Information should be provided 
which will demonstrate your understanding and management of important 
events or tasks. You must explain how the management and coordination of 
consultant and/or subcontractor efforts will be accomplished.
    The technical proposal must include a list of names and proposed 
duties of the professional personnel, consultants, and key subcontractor 
employees assigned to the project. Their resumes should be included and 
should contain information on education, background, recent experience, 
and specific scientific or technical accomplishments. The approximate 
percentage of time each individual will be available for this project 
must be included. The proposed staff hours for each of the above 
individuals should be allocated against each task or subtask for the 
project.
    The technical proposal must provide the general background, 
experience, and qualifications of the organization. Similar or related 
contracts, subcontracts, or grants should be included and contain the 
name of the customer, contract or grant number, dollar amount, time of 
performance, and the names and telephone numbers of the project officer 
and contracting/grants officer.
    The technical proposal must contain a discussion of present or 
proposed facilities and equipment which will be used in the performance 
of the contract.
    The technical proposal must be prepared and submitted in the 
following format:
    (Provide the required format.)

    (3) Business proposal instructions. Business proposal instructions 
consist of cost and pricing data and administrative and management data.
    (i) Cost and pricing data. Prospective offerors must be informed in 
the business proposal instruction that they are

[[Page 54]]

required to submit cost or pricing information in sufficient detail to 
allow a complete cost analysis. (See FAR 15.804 for requirements on cost 
or pricing data.) Categories and amounts of labor, materials, travel, 
computer time, overhead and other costs should be requested. Prospective 
offerors are to be provided Standard Form 1411, Contract Pricing 
Proposal Cover Sheet, for use in preparing the cost of pricing data, and 
are to be told to submit, as a minimum, cost proposals fully supported 
by cost and pricing data adequate to establish the reasonableness of the 
proposed amount. Prospective offerors are to comply with the instruction 
on the SF 1411 and fill in or check the appropriate boxes. In addition, 
they should be informed to itemize the cost for individual elements, 
each as analytical studies, reports, etc., and the estimated cost of 
each phase or segment of the offered performance.
    (ii) Administrative and management data.
    (A) The business proposal instructions must be written so that the 
contracting officer receives adequate information to evaluate each 
offeror's management capability and to determine whether each offeror is 
responsible. Therefore, under this section, information should be 
requested to allow the contracting officer to assess the following 
factors as they apply to the instant acquisition:
    (1) The offeror's financial capability;
    (2) The offeror's capability to meet delivery or performance 
schedules;
    (3) The offeror's record of past performance;
    (4) The offeror's record of business integrity;
    (5) The offerors's possession of necessary organization, experience, 
and technical skills, or the ability to obtain them;
    (6) The offeror's possession of required facilities; and
    (7) Any other special consideration involved in the instant 
acquisition.

In some cases, these factors may duplicate evaluation criteria and may 
be adequately addressed in the technical proposal instructions. However, 
the contracting officer must ensure that they are covered in both the 
business proposal instructions and the technical proposal instructions.
    (B) The contracting officer may determine that other administrative 
data in the form of additional business or cost information is 
necessary. Some examples of additional information include:
    (1) A copy of the current agreement on indirect cost rates;
    (2) A copy of the most recent financial statements;
    (3) A discussion on the extent of proposed subcontracting with small 
and disadvantaged business enterprises;
    (4) A request for pricing or cost breakdown tailored to the instant 
acquisition to provide information for a more thorough and complete cost 
analysis; and
    (5) A request for explicit instructions on pricing of options and 
individual line items.

However, care should be taken to request additional information only 
when necessary, to prevent excessive proposal preparation costs for 
offerors.
    (C) The following are required statements which must be included in 
the RFP.

    Your proposal must stipulate that it is predicated upon all the 
terms and conditions of this RFP. In addition, it must contain a 
statement to the effect that it is firm for a period of at least (insert 
number) days from the date of receipt by the Government.
    It is HHS policy that contractors provide all equipment and 
facilities necessary for performance of contracts; however, in some 
instances, an exception may be granted to furnish Government-owned 
property or to authorize purchase with contract funds. If additional 
equipment must be acquired, you must include in your proposal the 
description and estimated cost of each item, and whether you propose to 
furnish the item with your own funds.
    You must identify all Government-owned property in your possession 
and all property acquired from Federal funds, to which you have title, 
that is proposed to be used in the performance of the prospective 
contract.
    The management and control of Government property must be in 
accordance with HHS Publication (OS) 686 entitled, ``Contractor's Guide 
for Control of Government Property (1990),'' a copy of which will be 
provided upon request.

    (c) Section M, Evaluation factors for award--(1) General. (i) The 
evaluation criteria must be developed by the

[[Page 55]]

project officer and submitted to the contracting officer in the request 
for contract (RFC) for inclusion in the RFP. Development of these 
criteria and the assignment of the relative importance or weight to each 
criterion require the exercise of judgment on a case-by-case basis 
because they must be tailored to the requirements of the individual 
acquisition. Since the criteria will serve as a standard against which 
all proposals will be evaluated, it is imperative that they be chosen 
carefully to emphasize those factors considered to be critical in the 
selection of a contractor.
    (ii) The finalized evaluation criteria and indications of their 
relative importance or weights, as included in the RFP, cannot be 
changed except by a formal amendment to the RFP issued by the 
contracting officer. No factors other than those set forth in the RFP 
shall be used in the evaluation of proposals.
    (2) Review of evaluation criteria. (i) The evaluation criteria 
should be reviewed by the contracting officer in terms of the work 
statement. This review is not intended to dictate to the program office 
or project officer, but rather to ensure that the evaluation criteria 
are clear, concise, and fair so that all potential offerors are fully 
aware of the bases for proposal evaluation and are given an equal 
opportunity to compete.
    (ii) The project officer and the contracting officer should then 
review the evaluation criteria together to ascertain the following:
    (A) The criteria are described in sufficient detail to provide the 
offerors (and evaluators) with a total understanding of the factors to 
be involved in the evaluation process;
    (B) The criteria address the key programmatic concerns which the 
offerors must be aware of in preparing proposals;
    (C) The criteria are specifically applicable to the instant 
acquisition and are not merely restatements of criteria from previous 
acquisitions which are not relevant to this acquisition; and
    (D) The criteria are selected to represent only the significant 
areas of importance which must be emphasized rather than a multitude of 
factors. (All criteria tend to lose importance if too many are included. 
Using too many criteria will prove as detrimental as using too few.)
    (3) Examples of topics that form a basis for evaluation criteria. 
Typical examples of topics that form a basis for the development of 
evaluation criteria are listed in the following paragraphs. These 
examples are intended to assist in the development of actual evaluation 
criteria for a specific acquisition and should only be used if they are 
applicable to that acquisition. They are not to be construed as actual 
examples of evaluation criteria to be included in the RFP.
    (i) Understanding of the problem and statement of work;
    (ii) Method of accomplishing the objectives and intent of the 
statement of work;
    (iii) Soundness of the scientific or technical approach for 
executing the requirements of the statement of work (to include, when 
applicable, preliminary layouts, sketches, diagrams, other graphic 
representations, calculations, curves, and other data necessary for 
presentation, substantiation, justification, or understanding of the 
approach);
    (iv) Special technical factors, such as experience or pertinent 
novel ideas in the specific branch of science or technology involved;
    (v) Feasibility and/or practicality of successfully accomplishing 
the requirements (to include a statement and discussion of anticipated 
major difficulties and problem areas and recommended approaches for 
their resolution);
    (vi) Availability of required special research, test, and other 
equipment or facilities;
    (vii) Managerial capability (ability to achieve delivery or 
performance requirements as demonstrated by the proposed use of 
management and other personnel resources, and to successfully manage the 
project, including subcontractor and/or consultant efforts, if 
applicable, as evidenced by the management plan and demonstrated by 
previouis experience).
    (viii) Availability, qualifications, experience, education, and 
competence of

[[Page 56]]

professional, technical, and other personnel, to include proposed 
subcontractors and consultants (as evidenced by resumes, endorsements, 
and explanations of previous efforts); and
    (ix) Soundness of the proposed staff time or labor hours, propriety 
of personnel classifications (professional, technical, others), 
necessity for type and quantity of material and facilities proposed, 
validity of proposed subcontracting, and necessity of proposed travel.
    (4) Relative importance or weight.
    (i) A statement or indication of the relative importance or weight 
must be assigned to each evaluation criterion to inform prospective 
offerors (and evaluators) of the specific significance of each criterion 
in comparsion to the other criteria. Similarly, if a criterion is 
subdivided into parts, each of the parts must be assigned a statement or 
indication of the relative importance or weight.
    (ii) The two principal methods used to indicate the relative 
importance or weight are the numerical score and adjective description. 
The Department does not prescribe a single method for determining the 
relative importance or weight, but recommends the use of the numerical 
score method because it is more precise and informative. However, it is 
recognized that in some instances the use of the adjective description 
method be more appropriate and, hence, may be used when that 
determination is made.
    (iii) Cost or price is not generally included as one of the 
evaluation criteria and is not assigned an indication of relative 
importance or weight. However, a statement must be included in the RFP 
to reflect the relationship of cost or price in comparison to the other 
criteria. The contracting officer must ensure that this statement 
accurately reflects the appropriate balance between cost or price and 
the technical factors. The contracting officer and project officer 
should work together in arriving at the final determination regarding 
the relationship. The following are examples of statements that may be 
used to reflect this relationship. However, since these examples 
represent only the two extremes and the middle position, another 
statement may be developed to reflect the relationship which applies to 
the instant acquisition.
    (A) You are advised that paramount consideration shall be given to 
the evaluation of technical proposals rather then cost or price.
    (B) You are advised that paramount consideration shall be given to 
cost or price rather than the evaluation of technical proposals.
    (C) You are advised that the evaluation of technical proposals and 
cost or price are of approximately equal value.
[49 FR 13979, Apr. 9, 1984; 49 FR 36110, Sept. 14, 1984, as amended at 
53 FR 43207, Oct. 26, 1988; 54 FR 24343, June 7, 1989; 54 FR 43966, Oct. 
30, 1989; 56 FR 47003, Sept. 17, 1991]



315.407  Solicitation provisions.

    (c)(2) The referenced provision (FAR 52.215-6, Type of Business 
Organization) is a representation, has been included under Section K 
(see 315.406-5(a)(2)(iii)), and need not be restated again.
    (8) The provision at 352.215-12 shall be used in place of that 
specified at FAR 52.215-12.
    (g) The referenced provision (FAR 52.215-20, Place of Performance) 
is to be considered a certification and is included under section K (see 
315.406-5(a)(2)(iv)); it need not be restated again.
    (n) The contracting officer shall insert the provision at FAR 
Sec. 52.233-2, Service of Protest, in solicitations as required by FAR 
33.106(a).
[49 FR 13979, Apr. 9, 1984, as amended at 54 FR 43966, Oct. 30, 1989; 57 
FR 11690, Apr. 7, 1992]



315.408  Issuing solicitations.

    The minimum proposal preparation or response time between the date 
of distribution of a RFP and the date set for receipt of proposals shall 
not be less than 30 calendar days.
[49 FR 13979, Apr. 9, 1984, as amended at 53 FR 43208, Oct. 26, 1988]



315.409  Pre-proposal conferences.

    If a pre-proposal conference is to be held, the provision at 
352.215-72 shall be included in the solicitation.

[[Page 57]]



315.410  Amendment of solicitations before closing date.

    For additional information on amendments to solicitations, see FAR 
15.606.



315.413  Disclosure and use of information before award.



315.413-1  Alternate I.

    The Department shall not use Alternate I procedures.



315.413-2  Alternate II.

    The Department shall use the Alternate II procedures as modified in 
this subsection and shall use the provision at 352.215-12, Restriction 
on Disclosure and Use of Data, rather than the similar provision at FAR 
15.215-12 (see 315.407(c)(8)). Any reference in the FAR to the provision 
at FAR 52.215-12 shall apply to the provision at 352.215-12.
    (b) The term ``data,'' as used in this section and in 352.215-12, 
refers to trade secrets, business data, and technical data. Trade 
secrets, within the meaning of 18 U.S.C. 1905, include, for example, 
processes, formulas, and chemical compositions. Business data includes, 
for example, commercial information, financial information, and cost and 
pricing data. Technical data includes, for example, plans, designs, 
suggestions, improvements and concepts.

The Department recognizes that requests for proposals may require the 
offeror, including its prospective subcontractor(s), if any, to submit 
data which the offeror does not want used or disclosed for any purpose 
other than for evaluation of the proposal. Each proposal containing data 
which the offeror desires to restrict must be marked on the cover sheet 
by the offeror with the legend set forth at 352.215-12. Proposals, or 
portions of proposals, so marked shall be handled in accordance with the 
provisions of the legend.
    (c) Contracting officers receiving proposals which contain 
restrictive statements or legends not conforming to the referenced 
provision at 352.215-12 must carefully evaluate the form and substance 
of the restriction before making a determination to reject the proposal. 
Deviations in form which do not compromise the Government's rights may 
be accepted if approved by the activity's FOI official and the Office of 
General Counsel, Business and Administrative Law Division.
    (e) The Government notice shown in FAR 15.413-2(e) shall be used by 
this Department and is to be placed on the cover sheet of each proposal 
or quotation upon its receipt. The Government notice shall be completed 
by adding the following to the end of the last sentence: ``HHSAR 
paragraph 315.608-72.''
    (f) The Department sometimes finds it necessary (and in some 
instances is required by law) to seek evaluation of proposals outside 
the Department (see 315.608(d)(6)). All conditions required by FAR 
15.413-2(f) have been met and are covered in 315.608-72, Procedures for 
handling and disclosing proposals. In regard to item (f)(1) of FAR 
15.413-2, the Department has found that the procedure stated in the 
first sentence of paragraph 315.608-72 is best and considers it in 
compliance with the FAR requirement.
    (g) See subpart 324.2 for detailed procedures concerning FOIA 
requests.
[49 FR 13979, Apr. 9, 1984; 49 FR 36110, Sept. 14, 1984, as amended at 
51 FR 44294, Dec. 9, 1986]



315.470  Review of RFP.

    The principal official responsible for acquisition shall establish 
procedures to ensure that an independent review of the RFP is made 
between the time the synopsis is sent to the Commerce Business Daily 
announcing the availability of the RFP and the release date of the RFP. 
The individual selected to conduct the review must possess the 
acquisition knowledge necessary to readily ascertain whether the RFP 
contains the required information to be in conformance with all laws, 
regulations, and internal procedures and instructions. The individual 
selected to conduct the review must be a person other than the preparer 
of the RFP.
[49 FR 13979, Apr. 9, 1984, as amended at 50 FR 23129, May 31, 1985; 50 
FR 38004, Sept. 19, 1985]



315.471  Annual submission of representations and certifications.

    Each Principal Official Responsible for Acquisition (PORA) shall 
determine

[[Page 58]]

whether to allow the use of the annual submission of representations and 
certifications by offerors. If allowed, the provisions of FAR 14.213 
shall be followed.
[55 FR 13536, Apr. 11, 1990]



                  Subpart 315.5--Unsolicited Proposals



315.505  Content of unsolicited proposals.

    (d) Certification by offeror--To ensure against contacts between 
Department employees and prospective offerors which would exceed the 
limits of advance guidance set forth in FAR 15.504 resulting in an 
unfair advantage to an offeror, the principal official responsible for 
acquisition (or designee) shall ensure that the following certification 
is furnished to the prospective offeror and the executed certification 
is included as part of the resultant unsolicited proposal:

              Unsolicited Proposal Certification by Offeror

    This is to certify, to the best of my knowledge and belief, that:
    a. This proposal has not been prepared under Government supervision.
    b. The methods and approaches stated in the proposal were developed 
by this offeror.
    c. Any contact with employees of the Department of Health and Human 
Services has been within the limits of appropriate advance guidance set 
forth in FAR 15.504.
    d. No prior commitments were received from departmental employees 
regarding acceptance of this proposal.
 Date:__________________________________________________________________
 Organization:__________________________________________________________
 Name:__________________________________________________________________
 Title:_________________________________________________________________

(This certification shall be signed by a responsible official of the 
proposing organization or a person authorized to contractually obligate 
the organization.)



315.506  Agency procedures.

    (a) The principal official responsible for acquisition is 
responsible for establishing procedures to comply with FAR 15.506(a).
    (b) The principal official responsible for acquisition or his/her 
designee shall be the point of contact for coordinating the receipt and 
handling of unsolicited proposals. Contacts made outside the contracting 
activity shall be promptly coordinated with the principal official 
responsible for acquisition or the designee.



315.506-1  Receipt and initial review.

    (d) An unsolicited proposal shall not be refused consideration 
merely because it was initially submitted as a grant application. 
However, contracts shall not be awarded on the basis of unsolicited 
proposals which have been rejected for grant support on the ground that 
they lack scientific merit.



315.509  Limited use of data.

    The legend, Use and Disclosure of Data, prescribed in FAR 15.509(a) 
is to be used by the offeror to restrict the use of data for evaluation 
purposes only. However, data contained within the unsolicited proposal 
may have to be disclosed as a result of a request submitted pursuant to 
the Freedom of Information Act. Because of this possibility, the 
following notice shall be furnished to all prospective offerors of 
unsolicited proposals whenever the legend is provided in accordance with 
FAR 15.504(b)(7):

    The Government will attempt to comply with the ``Use and Disclosure 
of Data'' legend. However, the Government may not be able to withhold a 
record (data, document, etc.) nor deny access to a record requested by 
an individual (the public) when an obligation is imposed on the 
Government under the Freedom of Information Act, 5 U.S.C. 552, as 
amended. The Government's determination to withhold or disclose a record 
will be based upon the particular circumstances involving the record in 
question and whether the record may be exempted from disclosure under 
the Freedom of Information Act. Records which the offeror considers to 
be trade secrets and commercial or financial information and privileged 
or confidential must be identified by the offeror as indicated in the 
referenced legend.



                     Subpart 315.6--Source Selection



315.602  Applicability.

    (b) This subpart does not apply to contracts for architect-engineer 
services or contracts awarded to the Small Business Administration under 
section 8(a) of the Small Business Act.

[[Page 59]]



315.604  Responsibilities.

    (d) Personnel participating in the evaluation process must not 
discuss or reveal information concerning the evaluations except to an 
individual participating in the same evaluation proceedings, and then 
only to the extent that the information is required in connection with 
the proceedings. Divulging information during the evaluation, selection, 
and negotiation phases of the acquisition to offerors or to personnel 
not having a need to know could jeopardize the resultant award. 
Therefore, the contracting officer must instruct personnel participating 
in the evaluations to observe these restrictions and insure that all 
personnel understand that unauthorized disclosure of information, no 
matter how innocent, could compromise the acquisition process and is 
prohibited.
    (e) Only the contracting officer or his/her authorized 
representative within the contracting office shall conduct discussions 
with offerors relative to any aspect of the acquisition.



315.605  Evaluation factors.

    (e) The evaluation criteria included in the solicitation serve as 
the standard against which all proposals are evaluated. Prospective 
offerors rely upon the evaluation criteria in the solicitation in 
developing proposals, and they must be assured that the evaluation is 
conducted in accordance with those criteria. All personnel involved in 
the evaluation process must make sure that the evaluation criteria 
contained in the solicitation are the only criteria used in conducting 
the evaluation. See FAR 15.406-5(c) and 315.406-5(c) for detailed 
guidance on evaluation criteria.



315.607  Disclosure of mistakes before award.

    (a) The contracting officer shall require that offerors' 
clarifications are in writing.
    (c)(3) The chief of the contracting office is authorized to make the 
written determination permitting a correction of a mistake in a 
proposal.



315.608  Proposal evaluation.

    (a)(1) Cost of price evaluation. (See 315.608-77.)
    (2) Technical evaluation. (See 315.608-75 and 76.)
    (b) The determination required by FAR 15.608(b) shall be made by the 
chief of the contracting office.
[50 FR 23130, May 31, 1985, and 50 FR 38004, Sept. 19, 1985, as amended 
at 51 FR 44294, Dec. 9, 1986]



315.608-70  Technical evaluation plan.

    (a) A technical evaluation plan may be required by the contracting 
officer, at his/her discretion, when an acquisition is sufficiently 
complex as to warrant a formal plan.
    (b) The technical evaluation plan should include at least the 
following:
    (1) A list of technical evaluation panel members, their 
organizations as well as a list of their major consulting clients (if 
applicable), their qualifications, and curricula vitae (if available);
    (2) A justification for using non-Government technical evaluation 
panel members. (Justification is not required if non-Government 
evaluators will be used in accordance with standard contracting activity 
procedures or policies);
    (3) A statement that there is no apparent or actual conflict of 
interest regarding any panel member;
    (4) A copy of each rating sheet, approved by the contracting 
officer, to be used to assure consistency with the evaluation criteria; 
and
    (5) A brief description of the general evaluation approach.
    (c) The technical evaluation plan must be signed by an official 
within the program office in a position at least one level above the 
project officer or in accordance with contracting activity procedures.
    (d) The technical evaluation plan should be submitted to the 
contracting officer for review and approval before the solicitation is 
issued. The contracting officer shall make sure that the principal 
factors relating to the evaluation are reflected in the evaluation 
criteria when conducting the review of the plan.
[50 FR 23130, May 31, 1985, and 50 FR 38004, Sept. 19, 1985]



315.608-71  Technical evaluation panel.

    (a) General. (1) A technical evaluation panel is required for all 
acquisitions

[[Page 60]]

applicable to this subpart which are expected to exceed $300,000. The 
contracting officer has the discretion to require a technical evaluation 
panel for acquisitions not exceeding $300,000 based on the complexity of 
the acquisition.
    (2) The technical evaluation process requires careful consideration 
regarding the size, composition, expertise, and function of the 
technical evaluation panel. The efforts of the panel can result in the 
success or failure of the acquisition.
    (b) Role of the project officer. (1) The project officer is the 
contracting officer's technical representative for the acquisition 
action. The project officer may be a voting member of the technical 
evaluation panel, and may also serve as the chairperson of the panel, 
unless prohibited by law or contracting activity procedures.
    (2) The project officer is responsible for recommending panel 
members who are knowledgeable in the technical aspects of the 
acquisition and who are competent to identify strengths and weaknesses 
of the various proposals. The program training requirements specified in 
307.170 must be adhered to when selecting prospective panel members.
    (3) The project officer shall ensure that persons possessing 
expertise and experience in addressing issues relative to sex, race, 
national origin, and handicapped discrimination be included as panel 
members in acquisitions which address those issues. The intent is to 
balance the composition of the panel so that qualified and concerned 
individuals may provide insight to other panel members regarding ideas 
and approaches to be taken in the evaluation of proposals.
    (4) The project officer is to submit the recommended list of panel 
members to an official within the program office in a position at least 
one level above the project officer or in accordance with contracting 
activity procedures. This official will review the recommendations, 
appoint the panel members, and select the chairperson.
    (5) The project officer shall arrange for adequate and secure 
working space for the panel.
    (c) Role of the contracting officer. (1) The contracting officer is 
the Department's official representative with delegated acquisition 
authority to enter into and administer contracts. The term ``contracting 
officer,'' as used in this subpart, may be the contracting officer or 
his/her designated representative within the contracting office.
    (2) The contracting officer shall not serve as a member of the 
technical evaluation panel but should be available to:
    (i) Address the initial meeting of the technical evaluation panel 
(see 315.608-74(c));
    (ii) Provide assistance to the evaluators as required; and
    (iii) Ensure that the scores adequately reflect the written 
technical evaluation report comments (see 315.608-76).
    (d) Conflicts of interest. (1) If a panel member has an actual or 
apparent conflict of interest related to a proposal under evaluation, 
he/she shall be removed from the panel and replaced with another 
evaluator. If a suitable replacement is not available, the panel shall 
perform the review without a replacement.
    (2) For the purposes of this subpart, conflicts of interest are 
defined in the Department's Standards of Conduct set forth in 45 CFR 
Part 73 which incorporates 5 CFR Part 737, Post Employment Conflict of 
Interest. The Standards of Conduct shall be applicable to both in-house 
personnel and outside evaluators serving on the technical evaluation 
panel.
    (e) Continuity of evaluation process. (1) The technical evaluation 
panel is responsible for evaluating the original proposals, making 
recommendations to the chairperson regarding clarifications and 
deficiencies of proposals, and, if required by the contracting officer, 
assisting the contracting officer during discussions and negotiations, 
and reviewing supplemental, revised and/or ``best and final'' offers. To 
the extent possible, the same evaluators should be available throughout 
the entire evaluation and selection process to ensure continuity and 
consistency in the treatment of proposals. The following are examples of 
circumstances when it

[[Page 61]]

would not be necessary for the technical evaluation panel to evaluate 
revised proposals submitted during the acquisition:
    (i) The answers to questions do not have a substantial impact on the 
proposal (see 315.609(i));
    (ii) The ``best and final'' offers are not materially different from 
the original proposals; or
    (iii) The rankings of the offerors are not affected because the 
revisions to the proposals are relatively minor.
    (2) The chairperson, with the concurrence of the contracting 
officer, may decide not to have the panel evaluate the revised 
proposals. Whenever this decision is made, it must be fully documented 
by the chairperson and approved by the contracting officer.
    (3) When technical evaluation panel meetings are considered 
necessary by the contracting officer, the attendance of evaluators is 
mandatory. When the chairperson determines that an evaluator's failure 
to attend the meetings is prejudicial to the evaluation, the chairperson 
shall replace the individual after discussing the situation with the 
contracting officer and obtaining his/her concurrence and the approval 
of the program official responsible for appointing the panel members 
(see 315.608-71(b)(4)).
    (4) Whenever continuity of the evaluation process is not possible, 
and either new evaluators are selected or a reduced panel is decided 
upon, each proposal which is being reviewed at any stage of the 
acquisition shall be reviewed at that stage by all members of the 
revised panel unless it is impractical to do so because of the receipt 
of an unusually large number of proposals.
    (f) Use of outside evaluators. (1) The technical evaluation panel 
shall be composed of Government employees except when outside evaluators 
possess a required expertise which is not available within the 
Government, or as required by law.
    (2) The National Institutes of Health (NIH) and the Alcohol, Drug 
Abuse, and Mental Health Administration (ADAMHA) are required to have a 
peer review of research and development contracts in accordance with 
Pub. L. (Pub. L.) 93-352 as amended by Pub. L. 94-63; 42 U.S.C. 289 1-4. 
This legislation requires peer review of projects and proposals, and not 
more than one-fourth of the members of a peer review group may be 
officers or employees of the United States. NIH and ADAMHA are therefore 
exempt from the provisions of 315.608-71 to the extent that 42 U.S.C. 
289 1-4 applies.
[50 FR 23130, May 31, 1985, and 50 FR 38004, Sept. 19, 1985, as amended 
at 53 FR 15563, May 2, 1988]



315.608-72  Procedures for handling and disclosing proposals.

    (a) The procedures and notice specified in FAR 15.413-2 and 315.413-
2 shall be used in handling solicited proposals and for disclosing 
proposals outside the Government for evaluation purposes. (For 
unsolicited proposals, see FAR 15.509 and 315.509.)
    (b) Decisions to disclose proposals outside the Government for 
evaluation purposes shall be made by the chief official having 
programmatic responsibility for the acquisition, after consultation with 
the contracting officer and in accordance with operating division 
procedures. The decision to disclose either a solicited or unsolicited 
proposal outside the Government for the purpose of obtaining an 
evaluation shall take into consideration the avoidance of organizational 
conflicts of interest and any competitive relationship between the 
submitter of the proposal and the prospective evaluator(s).
    (c) When it is determined to disclose a solicited proposal outside 
the Government for evaluation purposes, the following or similar 
conditions shall be included in the written agreement with the 
evaluator(s) prior to disclosure (see FAR 15.413-2(f) and 315.413-2(f)). 
Also, a review must be made to ensure that the notice required by FAR 
15.413-2(e) is affixed to the proposal before it is disclosed to the 
evaluator(s).

                   Conditions for Evaluating Proposals

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

[[Page 62]]

    Any notice or legend placed on the proposal by either the Department 
or the submitter of the proposal shall be applied to any reproduction or 
abstract provided to the evaluator or made by the evaluator. Upon 
completion of the evaluation, the evaluator shall return the Government-
furnished copy of the proposal or abstract, and all copies thereof, to 
the Departmental office which initially furnished the proposal for 
evaluation.
    Unless authorized by the Department's initiating office, the 
evaluator shall not contact the submitter of the proposal concerning any 
apsects of its contents.
    The evaluator will be obligated to obtain commitments from its 
employees and subcontractors, if any, in order to effect the purposes of 
these conditions.
[50 FR 23131, May 31, 1985, and 50 FR 38004, Sept. 19, 1985]



315.608-73  Receipt of proposals.

    (a) After the closing date set by the solicitation for the receipt 
of proposals, the contracting officer will use a transmittal memorandum 
to forward the technical proposals to the project officer or chairperson 
for evaluation. The business proposals will be retained by the 
contracting officer for evaluation (see 315.608-77).
    (b) The transmittal memorandum to the chairperson shall include at 
least the following:
    (1) A list of the names of the organizations submitting proposals;
    (2) A reference to 315.604(d) on the need to preserve the integrity 
of the source selection process;
    (3) A requirement for a technical evaluation report in accordance 
with 315.608-76; and
    (4) The establishment of a date for receipt of the technical 
evaluation report.
[50 FR 23131, May 31, 1985, and 50 FR 38004, Sept. 19, 1985]



315.608-74  Convening the technical evaluation panel.

    (a) Normally, the technical evaluation panel will convene to 
evaluate the proposals. However, there may be situations when the 
contracting officer determines that it is not feasible for the panel to 
convene. Whenever this decision is made, care must be taken to assure 
that the technical review is closely monitored to produce acceptable 
results.
    (b) When a panel is convened, the chairperson is responsible for the 
control of the technical proposals provided to him/her by the 
contracting officer for use during the evaluation process. The 
chairperson will generally distribute the technical proposals at the 
initial panel meeting and will establish procedures for securing the 
proposals whenever they are not being evaluated to insure their 
confidentiality. After the evaluation is complete, all proposals must be 
returned to the contracting officer, destroyed or filed in an 
appropriate manner to maintain the confidential nature of the data.
    (c) The contracting officer shall address the initial meeting of the 
panel and state the basic rules for conducting the evaluation. The 
contracting officer shall provide written guidance to the panel if he/
she is unable to attend the initial panel meeting. The guidance should 
include:
    (1) An explanation of conflicts of interest (see 315.608-71(d));
    (2) The necessity to read and understand the solicitation, 
especially the statement of work and evaluation criteria, prior to 
reading the proposals;
    (3) The need for evaluators to restrict the review to only the 
solicitation and the contents of the technical proposals;
    (4) The need for each evaluator to review all the proposals;
    (5) The need to watch for ambiguities, inconsistencies, errors, and 
deficiencies which should be surfaced during the evaluation process;
    (6) An explanation of the evaluation process and what will be 
expected of the evaluators throughout the process;
    (7) The need for the evaluators to be aware of the requirement to 
have complete written documentation of the individual strengths and 
weaknesses which affect the scoring of the proposals; and
    (8) An instruction directing the evaluators that, until the award is 
made, information concerning the acquisition must not be disclosed to 
any person not directly involved in the evaluation process.
[50 FR 23131, May 31, 1985, and 50 FR 38004, Sept. 19, 1985]

[[Page 63]]



315.608-75  Rating and ranking of proposals.

    The evaluators will individually read each proposal, describe 
tentative strengths and weaknesses, and develop preliminary scores in 
relation to each evaluation criterion set forth in the solicitation. The 
evaluators will use the rating sheets either in the technical evaluation 
plan or approved by the contracting officer when a technical evaluation 
plan is not required (see 315.608-70). After this has been accomplished, 
the evaluators shall discuss in detail the individual strengths and 
weaknesses described by each evaluator and, if possible, arrive at a 
common understanding of the major strengths and weaknesses and the 
potential for correcting each offeror's weakness(es). Each evaluator 
will score each proposal, and then the technical evaluation panel will 
collectively rank the proposals. Generally, ranking will be determined 
by adding the numerical scores assigned to the evaluation criteria and 
finding the average for each offeror. The evaluators should then 
identify whether each proposal is acceptable or unacceptable. 
Predetermined cutoff scores shall not be employed.
[50 FR 23131, May 31, 1985, and 50 FR 38004, Sept. 19, 1985]



315.608-76  Technical evaluation report.

    A technical evaluation report shall be prepared and furnished to the 
contracting officer by the chairperson and maintained as a permanent 
record in the contract file. The report must reflect the ranking of the 
proposals and identify each proposal as acceptable or unacceptable in 
accordance with 315.608-75. The report must also include a narrative 
evaluation specifying the strengths and weaknesses of each proposal, a 
copy of each rating sheet, and any reservations, qualifications, or 
areas to be addressed that might bear upon the selection of sources for 
negotiation and award. Concrete technical reasons supporting a 
determination of unacceptability with regard to any proposal must be 
included. The report should also include specific points and questions 
which are to be raised in discussions or negotiations.
[50 FR 23132, May 31, 1985, and 50 FR 38004, Sept. 19, 1985]



315.608-77  Evaluation of business proposals.

    (a) The contracting officer shall evaluate the business proposals 
concurrently with the evaluation of the technical proposals. The 
contracting officer must adhere to the requirements for cost or price 
analysis included in FAR 15.805-1 for each business proposal in the 
competitive range. An audit report may be required in accordance with 
FAR 15.805-5 and 315.805-5. The contracting officer must determine the 
extent of analysis in each case depending on the amount of the proposal, 
the technical complexity and related cost or price, and cost realism. 
The contracting officer should request the project officer to analyze 
such items as the number of labor hours proposed for various labor 
categories; the mix of labor hours and categories of labor in relation 
to the technical requirements of the project; the kinds and quantities 
of material, equipment, and supplies; types, numbers, and hours/days of 
proposed consultants; logic of proposed subcontracting; analysis of the 
travel proposed including number of trips, locations, purpose, and 
travelers; and kinds and quantities of data processing. The project 
officer shall provide his/her opinion as to whether these elements are 
necessary and reasonable for efficient contract performance. Exceptions 
to proposed elements shall be supported by adequate rationale to allow 
for effective negotiations. The contracting officer should also request 
the assistance of a cost/price analyst when considered necessary. In all 
cases, the negotiation memorandum (see 315.672) must include the 
rationale used in determining that the price or cost is fair and 
reasonable.
    (b) The contracting officer must appraise the management capability 
of the offeror to perform the required work in a timely manner. In 
making this appraisal, the contracting officer should consider factors 
such as the offeror's management organization,

[[Page 64]]

past performance, reputation for reliability, availability of the 
required facilities, and cost controls. This information is to be used 
by the contracting officer to determine the offeror's responsibility.
[50 FR 23132, May 31, 1975, and 50 FR 38004, Sept. 19, 1985]



315.609  Competitive range.

    (a) A proposal must be included in the competitive range unless 
there is no real possibility that it can be improved to the point where 
it becomes the most acceptable.
    (e) In certain circumstances, when deciding which proposals should 
be included in the competitive range, the contracting officer may 
request that the technical evaluation panel review the cost or price 
data. Typical situations which may necessitate this review include a 
suspected ``buy-in,'' large differences in cost or price among the 
proposals, proposals receiving high technical ratings which have 
relatively high costs, and proposals receiving low technical ratings 
which have relatively low costs. The resultant comparison of cost or 
price to technical factors and the determination of cost or price 
realism should assist the contracting officer in deciding which 
proposals are to be included in the competitive range.
    (f) All determinations regarding the inclusion or exclusion of 
proposals in the competitive range must be completely documented, 
including the salient reasons for the determinations, and set forth in 
the negotiation memorandum.
    (g) Some of the factors which the contracting officer should 
consider in determining the competitive range are:
    (1) The relative importance of cost or price as compared to 
technical factors in accordance with the solicitation provisions 
required in 315.406-5(c);
    (2) The susceptibility of significantly reducing a proposal with an 
unreasonable high price or cost without undermining the technical merit 
if the offeror otherwise has a reasonable chance to receive an award; 
and
    (3) The likelihood of reducing cost or price of a proposal which 
exceeds the Government's requirements.
    (h) The contacting officer shall conduct a thorough review of the 
technical evaluation report to be assured that:
    (1) All determinations of unacceptability are supported by concrete 
and comprehensive statements that are factual and convincing and are 
consistent with the evaluation criteria set forth in the solicitation. 
Every statement should be reviewed carefully to eliminate any doubts as 
to the unacceptability of a proposal;
    (2) All recommendations to exclude proposals from the competitive 
range are supported by persuasive rationale and sufficient facts to 
substantiate a judgment that meaningful discussions are not possible or 
there is no reasonable chance of the proposal being selected for award;
    (3) Those cases where only one organization is found to be 
technically acceptable are fully scrutinized; and
    (4) Unacceptable proposals contain ``information'' deficiencies 
which are so material as to preclude any possibility of upgrading the 
proposal to a competitive level except through major revisions and 
additions which would be tantamount to the submission of another 
proposal.
    (i) The contracting officer and project officer should discuss the 
uncertainties and/or deficiencies that are included in the technical 
evaluation report for each proposal in the competitive range. Technical 
questions should be developed by the project officer and/or the 
technical evaluation panel and should be included in the technical 
evaluation report. The management and cost or price questions should be 
prepared by the contracting officer with assistance from the project 
officer and/or panel as required. The method of requesting offerors in 
the competitive range to submit the additional information will vary 
depending on the complexity of the questions, the extent of additional 
information requested, the time needed to analyze the responses, and the 
time frame for making the award. However, to the extent practicable, all 
questions and answers should be in writing. Each offeror in the 
competitive range shall be given an equitable period of time for 
preparation of responses to questions to the extent practicable. The 
questions

[[Page 65]]

should be developed so as to disclose the ambiguities, uncertainties, 
and deficiencies of the offeror (see FAR 15.610(c)).



315.610  Written or oral discussions.

    (b) The contracting officer, with the support of personnel who 
evaluated the technical proposals, and, if necessary, cost analysts, 
attorneys, etc., must conduct written or oral discussions with all 
responsible offerors within the competitive range.
    (d) Careful judgment must be exercised in determining the extent of 
discussions. In some cases, more than one round of discussions with all 
the offerors within the competitive range may be required. The time 
available, the expense and administrative limitations, and the 
complexity, size, and significance of the acquisition should all be 
considered in deciding on the type, duration, and depth of the 
discussions.



315.611  Best and final offers.

    (b)(5) Notice that confirmation of a prior offer should be 
specifically stated as a final offer; and
    (6) Notice that all revisions to former offers should be submitted 
on Standard Form 1411, Contract Pricing Proposal Cover Sheet, and should 
be fully documented.
    (c) ``Best and final'' offers are subject to a final evaluation of 
price or cost and other salient factors by the contracting officer and 
project officer with assistance from a cost/price analyst, and an 
evaluation of technical factors by the technical evaluation panel, as 
necessary. Proposals may be technically rescored and reranked by the 
technical evaluation panel and a technical evaluation report prepared. 
To the extent practicable, the evaluation shall be performed by the same 
evaluators who reviewed the original proposals (see 315.670--).
    (e) Of particular importance in the award of research or development 
contracts, including those with educational institutions, is the 
competence of key personnel in the specific field of science or 
technology involved, as reflected in the proposal. However, awards 
should not be made for research and development capabilities that exceed 
those needed for the successful performance of the particular project.



315.670  Negotiation with the selected source.

    (a) After selection of the successful proposal, a limited 
negotiation with the selected offeror may be conducted if deemed 
necessary. However, no factor which could have any effect on the 
selection process may be introduced into the negotiation after the 
common cutoff date for receipt of best and final offers. The negotiation 
shall not in any way prejudice the competitive interests or right of the 
unsuccessful offerors. Negotiations with the selected offeror shall be 
restricted to definitizing the final agreement on terms and conditions; 
e.g., assuming none of these factors were involved in the selection 
process, negotiation could include such topics as payment provisions, 
patent rights, rights in data, property provisions, labor rates, 
indirect cost rates, and fees. Prior to conducting the limited 
negotiation, the contracting officer shall approve a written 
determination citing both the specific issues to be discussed and the 
rationale showing that the negotiations shall not have any effect on the 
selection process.
    (b) Caution must be exercised by the contracting officer to insure 
that the negotiation is not used to change the requirement contained in 
the solicitation, nor to make any other changes which would impact on 
the source selection decision. Whenever a material change occurs in the 
requirements as a result of the negotiation, the competition must be 
reopened and all offerors submitting ``best and final'' offers must be 
given an opportunity to resubmit proposals based on the revised 
requirements. Whenever there is a question as to whether a change is 
material, the contracting officer should obtain the advice of technical 
personnel and legal counsel before reopening the competition. 
Significant changes in the offeror's cost proposal may also necessitate 
a reopening of competition if such changes alter the factors involved in 
the original selection process.
    (c) Should negotiations beyond those specified in (a) above be 
required for

[[Page 66]]

any reason, discussions must be reopened with all offerors submitting 
``best and final'' offers.
    (d) Upon completion of the negotiation, the contracting officer 
shall obtain a confirmation letter from the successful offeror which 
includes any revisions to the technical proposal, the agreed to price or 
cost, and, as applicable, a certificate of current cost or pricing data.
[49 FR 13979, Apr. 9, 1984, 49 FR 36110, Sept. 14, 1984]



315.671  Post negotiation contract preparation and award.

    (a) The contracting officer must perform the following actions after 
negotiations have been completed:
    (1) Prepare the negotiation memorandum in accordance with 315.672;
    (2) Prepare the contract containing all agreed to terms and 
conditions and clauses required by law or regulation;
    (3) Include in the contract file the pertinent documents referenced 
in FAR 4.803; and
    (4) Obtain the appropriate approval of proposed contract awards in 
accordance with Subpart 304.71 and contracting activity procedures.
    (b) After receiving the required approvals, the contract should be 
transmitted to the prospective contractor for signature. The prospective 
contractor must be informed that the contract is not effective until 
accepted by the contracting officer.
    (c) The contract shall not be issued until the finance office 
certifies that the funds are available for obligation.



315.672  Preparation of negotiation memorandum.

    The negotiation memorandum or summary of negotiations is a complete 
record of all actions leading to award of a contract and is prepared by 
the contract negotiator. It should be in sufficient detail to explain 
and support the rationale judgments, and authorities upon which all 
actions were predicated. The memorandum will document the negotiation 
process and reflect the negotiator's actions, skills, and judgments in 
concluding a satisfactory agreement for the Government. Negotiation 
memorandums shall contain discussion of the following or a statement of 
nonapplicability; however, information already contained in the contract 
file need not be reiterated. A reference to the document which contains 
the required information is satisfactory.
    (a) Description of articles and services and period of performance. 
A description of articles and services, quantity, unit price, total 
contract amount, and period of contract performance should be set forth 
(if Supplemental Agreement--show previous contract amount as revised, as 
well as information with respect to the period of performance).
    (b) Acquisition planning. Summarize any acquisition planning 
activities that have taken place. Include items such as meetings with 
program and staff personnel and the development of acquisition planning 
schedules.
    (c) Synopsis of proposed acquisition. A statement as to whether the 
acquisition has or has not been publicized in accordance with FAR 
Subpart 5.2. A brief statement of explanation should be included with 
reference to the specific basis for exemption under the FAR, if 
applicable.
    (d) Contract type. Provide sufficient detail to support the type of 
contractural instrument recommended for the acquisition and cite any 
required D & F. If the contract is a cost-sharing type, explain the 
essential cost-sharing features.
    (e) Extent of competition. The extent to which full and open 
competition was solicited and obtained must be discussed. The discussion 
shall include the date of solicitation, sources solicited, and 
solicitation results. If a late proposal was received, discuss whether 
or not the late proposal was evaluated and the rationale for the 
decision. If the acquisition is to be awarded without full and open 
competition, discuss the rationale for the decision.
    (f) Technical evaluation. Summarize the results presented in the 
technical evaluation report and delineate the basis of acceptability or 
unacceptability of the proposals from a technical standpoint. Discussion 
should be in nontechnical terms.
    (g) Business evaluation. Summarize the results presented in the 
business report and delineate the basis for the determination of 
acceptability or

[[Page 67]]

unacceptability of the business proposals.
    (h) Competitive range. If full and open competition, describe how 
the zone of consideration or competitive range was determined and state 
the offerors who were included in the competitive range and the ones who 
were not. Explain why any offeror who submitted a technically acceptable 
proposal was not included in further discussions. Comment on any changes 
made in the offeror's proposal as a result of the discussions.
    (i) Cost breakdown and analysis. Include a complete cost breakdown 
together with the negotiator's analysis of the estimated cost by 
individual cost elements. The negotiator's analysis should contain such 
information as:
    (1) A comparison of cost factors proposed in the instant case with 
actual cost factors used in earlier contracts, using the same cost 
centers of the same supplier or cost centers or other sources having 
recent contracts for the same or similar item.
    (2) Any pertinent Government-conducted audit of the proposed 
contractor's records of any pertinent cost advisory report (see FAR 
15.805).
    (3) Any pertinent technical evaluation inputs as to necessity, 
allocability and reasonableness of labor, material and other direct 
expenses.
    (4) Any other pertinent information to fully support the basis for 
and rationale of the cost analysis.
    (5) If the contract is an incentive type, discuss the rationale for 
the following:
    (i) Cost-plus-award-fee.
    (A) Base fee.
    (B) Maximum fee.
    (C) Award fee.
    (ii) Cost-plus-incentive-fee.
    (A) Minimum fee.
    (B) Target fee.
    (C) Maximum fee.
    (D) Incentives relative to performance and/or delivery.
    (E) Sharing ratios.
    (iii) Fixed-price incentives.
    (A) Target profit.
    (B) Target price.
    (C) Ceiling price.
    (D) Sharing rations.
    (E) Incentives relative to performance and/or delivery.
    (6) A justification of the reasonableness of the proposed 
contractor's estimated profit or fixed fee, considering such factors as 
any competitive elements, established efficiency or performance, extent 
of the risk assumed by the proposed contractor, character of the 
proposed contractor's normal business, the extent of subcontracting in 
the instant case and the reasons, capital employed, and other factors as 
are appropriate, including type of organization.
    (j) Government-furnished property and Government-provided 
facilities. With respect to Government-furnished material or Government-
provided facilities, equipment, tooling, or other property, include the 
following: (A separate D & F is required for facilities construction.)
    (1) Where no property is to be provided, a statement to that effect.
    (2) Where property is to be provided, a full description, the 
estimated dollar value, the basis of price comparison with competitors, 
and the basis of rental charge, if rental is involved.
    (3) Where the furnishing of any property or the extent has not been 
determined and is left open for future resolution, a detailed 
explanation.
    (k) Negotiations. Include a statement as to the date and place 
negotiations were conducted, and identify members of both the Government 
and contractor negotiating teams by area of responsibility. Include 
negotiation details relative to the statement of work, terms and 
conditions, and special provisions. The results of cost or price 
negotiations must include the information required by FAR 31.109 and 
15.808. In addition, if cost or pricing data was required to be 
submitted and certified, the negotiation record must also contain the 
extent to which the contracting officer relied upon the factual cost or 
pricing data submitted and used in negotiating the cost or price.
    (l) Other considerations. Include coverage of areas such as:
    (1) Financial data with respect to a contractor's capacity and 
stability.
    (2) Determination of contractor responsibility.
    (3) Details as to why the method of payment, such as progress 
payment,

[[Page 68]]

advance payment, etc., is necessary. Also cite any required D & F's.
    (4) Information with respect to obtaining of a certificate of 
current cost or pricing data.
    (5) Other required special approvals, such as those referenced in 
307.105-2.
    (6) If the contract represents an extension of previous work, the 
status of funds and performance under the prior contract(s) should be 
reflected. Also, a determination should be made that the Government has 
obtained enough actual or potential value from the work previously 
performed to warrant continuation with the same contractor. (Project 
officer should furnish the necessary information.)
    (7) If the contract was awarded by full and open competition state 
where the unsuccessful offerors' proposals are filed.
    (8) State that equal opportunity provisions of the proposed contract 
have been explained to the contractor, and it is aware of its 
responsibilities. Also state whether or not a clearance is required.
    (9) If the contract is for services, a statement must be made, in 
accordance with FAR 37.103 and 337.103, that the services to be acquired 
are nonpersonal in nature.
    (m) Terms and conditions. Identify the general provisions and any 
special clauses and conditions that are contained in the contract, such 
as option arrangements, incremental funding, anticipatory costs, 
deviations from the standard clauses, etc. The basis and rationale for 
inclusion of any special terms and conditions must be stated and, where 
applicable, the document which granted approval for its use identified.
    (n) Recommendation. A brief statement setting forth the 
recommendations for award.
    (o) Signature. The memorandum must be signed by the contract 
negotiator who prepared the memorandum.
[49 FR 13979, Apr. 9, 1984, as amended at 50 FR 23132, May 31, 1985; 50 
FR 38004, Sept. 19, 1985]



                    Subpart 315.8--Price Negotiation



315.804  Cost or pricing data.



315.804-3  Exemptions from or waiver of submission of certified cost or pricing data.

    (i) Waiver for exceptional cases. The authority referenced in FAR 
15.804-3(i) may be delegated to the principal official responsible for 
acquisition.
[51 FR 44294, Dec. 9, 1986]



315.805  Proposal analysis.



315.805-5  Field pricing support.

    (2) When some or all information sufficient to determine the 
reasonableness of the proposed cost or price is already available or can 
be obtained by phone from the cognizant audit agency, contracting 
officers may request less-than-complete field pricing support 
(specifying in the request the information needed) or may waive in 
writing the requirement for audit and field pricing support by 
documenting the file to indicate what information is to be used instead 
of the audit report and the field pricing report.
    (c)(1) When initiating audit and field pricing support, the 
contracting officer shall do so by sending a request to the cognizant 
administrative contracting officer (ACO), with an information copy to 
the cognizant audit office. When field pricing support is not available, 
the contracting officer shall initiate an audit by sending, in 
accordance with agency procedures, two (2) copies of the request to the 
OIG Office of Audits' Regional Audit Director. In both cases, the 
contracting officer shall, in the request:
    (i) Prescribe the extent of the support needed;
    (ii) State the specific areas for which input is required;
    (iii) Include the information necessary to perform the review (such 
as the offeror's proposal and the applicable portions of the 
solicitations, particularly those describing requirements and delivery 
schedules);
    (iv) Provide the complete address of the location of the offeror's 
financial records that support the proposal;

[[Page 69]]

    (v) Identify the office having audit responsibility if other than an 
HHS Regional Audit Office; and
    (vi) Specify a due date for receipt of a verbal report to be 
followed by a written audit report. (If the time available is not 
adequate to permit satisfactory coverage of the proposal, the auditor 
shall so advise the contracting officer and indicate the additional time 
needed.) Normally, the Office of Audits will need 30 days after receipt 
of the proposal for submission of oral results. However, the Office of 
Audits' ability to conduct reviews by the due date will be influenced by 
the OPDIV's ability to properly plan its acquisitions. If the Office of 
Audits requires additional time to conduct the review, the contracting 
officer has the option, at the time the auditor acknowledges receipt of 
the request, to accept the revised due date or cancel the request and 
use cost advisory services within the agency to satisfy the requirement. 
In such cases, the contracting officer shall immediately advise the OIG/
OA/Regional Audit Director and the OIG/OA/Division of Audit Coordination 
(OIG/OA/DAC) of the revised due date or cancellation of the request.
    (4) One copy of the audit request letter that was submitted to the 
Regional Audit Director and a complete copy of the contract price 
proposal shall be submitted to OIG/OA/DAC.
    (5) Whenever, an audit review has been conducted by the Office of 
Audits, two (2) copies of the memorandum of negotiation shall be 
forwarded to OIG/OA/DAC by the contracting officer (see FAR 15.808(b)).



                          Subpart 315.9--Profit



315.900  Scope of subpart.

    This subpart--
    (c) Prescribes a structured approach for establishing the profit or 
fee portion of the Government prenegotiation objective in all contracts 
requiring cost analysis except as stated in 315.905-70(b). The profit 
analysis factors set forth at FAR 15.905 shall be used in all excepted 
contracts requiring cost analysis.



315.905-70  Structured approach.

    (a) General. (1) The structured approach for determining profit or 
fee (hereafter referred to as profit) provides contracting officers with 
a technique that will ensure consideration of the relative value of the 
appropriate profit factors described in 315.905-71 in the establishment 
of a profit objective for the conduct of negotiations. The contracting 
officer's analysis of these profit factors is based on information 
available to him/her prior to negotiations. Such information is 
furnished in proposals, audit data, assessment reports, preaward surveys 
and the like. The structured approach also provides a basis for 
documentation of this objective, including an explanation of any 
significant departure from this objective in reaching an agreement. The 
extent of documentation should be directly related to the dollar value 
and complexity of the proposed acquisition.
    (2) The negotiation process does not require agreement on either 
estimated cost elements or profit elements. The profit objective is a 
part of an overall negotiation objective which, as a going-in objective, 
bears a distinct relationship to the cost objective and any proposed 
sharing arrangement. Since profit is merely one of several interrelated 
variables, the Government negotiator generally should not complete the 
profit negotiation without simultaneously agreeing on the other 
variables. Specific agreement on the exact weights or values of the 
individual profit factors is not required and should not be attempted.
    (b) Exceptions. (1) The profit-analysis factors set forth at FAR 
15.905 shall be used for establishing profit objectives under the 
following listed circumstances. Generally, it is expected that this 
method will be supported in a manner similar to that used in the 
structured approach (profit factor breakdown and documentation of the 
profit objective); however, factors within FAR 15.905 considered 
inapplicable to the acquisition will be excluded from the profit 
objective.
    (i) Contracts not expected to exceed $100,000;
    (ii) Architect-engineer contracts;

[[Page 70]]

    (iii) Management contracts for operation and/or maintenance of 
Government facilities;
    (iv) Construction contracts;
    (v) Contracts primarily requiring delivery of material supplies by 
subcontractors;
    (vi) Termination settlements; and
    (vii) Cost-plus-award-fee contracts (However, contracting officers 
may find it advantageous to perform a structured profit analysis as an 
aid in arriving at an appropriate fee arrangement).
    (2) Other exceptions may be made in the negotiation of contracts 
having unusual pricing situations. Such exceptions shall be justified in 
writing by the contracting officer in situations where the structured 
approach is determined to be unsuitable.
    (c) Limitation. The maximum profit objective shall be the percentage 
allowed pursuant to statute or regulation (see FAR 15.903(d)).
    (d) Profit objective. (1) A profit objective is that part of the 
estimated contract price objective or value which, in the judgment of 
the contracting officer, constitutes an appropriate amount of profit for 
the acquisition being considered. This objective should realistically 
reflect the total overall task to be performed and the requirements 
placed on the contractor.
    (2) Development of a profit objective should not begin until the 
following actions have been accomplished:
    (i) A thorough review of proposed contract work;
    (ii) A review of all available knowledge regarding the contractor 
pursuant to FAR Subpart 9.1, including audit data, preaward survey 
reports and financial statements, as appropriate; and
    (iii) An analysis of the contractor's cost estimate and comparison 
with the Government's estimate or projection of cost.



315.905-71  Profit factors.

    (a) The following factors shall be considered in all cases in which 
profit is to be negotiated. The weight ranges listed after each factor 
shall be used in all instances where the structured approach is used.

                                                                        
------------------------------------------------------------------------
                                                               Weight   
                      Profit factors                           ranges   
                                                              (percent) 
------------------------------------------------------------------------
Contractor effort:                                                      
  Material acquisition....................................        1 to 5
  Direct labor............................................       4 to 15
  Overhead................................................        4 to 9
  General management (G&A)................................        4 to 8
  Other costs.............................................        1 to 5
Other factors:                                                          
  Cost risk...............................................        0 to 7
  Investment..............................................      -2 to +2
  Performance.............................................      -1 to +1
  Socioeconomic programs..................................    -.5 to +.5
  Special situations......................................  ............
------------------------------------------------------------------------

    (b) Under the structured approach, the contracting officer shall 
first measure ``Contractor Effort'' by the assignment of a profit 
percentage within the designated weight ranges to each element of 
contract cost recognized by the contracting officer. The amount 
calculated for the cost of money for facilities capital is not to be 
included for the computation of profit as part of the cost base.
    (c) The suggested categories under ``Contractor Effort'' are for 
reference purposes only. Often individual proposals will be in a 
different format, but since these categories are broad and basic, they 
provide sufficient guidance to evaluate all other items of cost.
    (d) After computing a total dollar profit for ``Contractor Effort,'' 
the contracting officer shall then calculate the specific profit dollars 
assigned for cost risk, investment, performance, socioeconomic programs, 
and special situations. This is accomplished by multiplying the total 
Government Cost Objective, exclusive of any cost of money for facilities 
capital, by the specific weight assigned to the elements within the 
``Other Factors'' category. Form HHS-674, Structured Approach Profit/Fee 
Objective, should be used, as appropriate, to facilitate the calculation 
of this profit objective. Form HHS-674 is illustrated in 353.370-674.
    (e) In making a judgment of the value of each factor, the 
contracting officer should be governed by the definition, description, 
and purpose of the factors together with considerations for evaluating 
them as set forth in 315.905-72 and 315.905-73.
    (f) The structured approach was designed for arriving at profit 
objectives for other than nonprofit organizations. However, if 
appropriate adjustments

[[Page 71]]

are made to reflect differences between profit and nonprofit 
organizations, the structured approach can be used as a basis for 
arriving at profit objectives for nonprofit organizations. Therefore, 
the structured approach, as modified in paragraph (f)(2) below, shall be 
used to establish profit objectives for nonprofit organizations.
    (1) For purposes of this section, nonprofit organizations are 
defined as those business entities organized and operated exclusively 
for charitable, scientific, or educational purposes, no part of the net 
earnings of which inure to the benefit of any private shareholder or 
individual, and which are exempt from Federal income taxation under 
Section 501 of the Internal Revenue Code.
    (2) For contracts with nonprofit organizations where profit is 
involved, an adjustment of up to 3 percentage points will be subtracted 
from the total profit objective percentage. In developing this 
adjustment, it will be necessary to consider the following factors:
    (i) Tax position benefits;
    (ii) Granting of financing through advance payments; and
    (iii) Other pertinent factors which may work to either the advantage 
or disadvantage of the contractor in its position as a nonprofit 
organization.
[49 FR 13979, Apr. 9, 1984, as amended at 53 FR 15563, May 2, 1988; 56 
FR 47003, Sept. 17, 1991]



315.905-72  Contractor effort.

    (a) General. Contractor effort is a measure of how much the 
contractor is expected to contribute to the overall effort necessary to 
meet the contract performance requirement in an efficient manner. This 
factor, which is apart from the contractor's responsibility for contract 
performance, takes into account what resources are necessary and what 
the contractor must do to accomplish a conversion of ideas and material 
into the final service or product called for in the contract. This is a 
recognition that within a given performance output, or within a given 
sales dollar figure, necessary efforts on the part of individual 
contractors can vary widely in both value and quantity, and that the 
profit objective should reflect the extent and nature of the 
contractor's contribution to total performance. A major consideration, 
particularly in connection with experimental, developmental, or research 
work, is the difficulty or complexity of the work to be performed, and 
the unusual demands of the contract, such as whether the project 
involves a new approach unrelated to existing technology and/or 
equipment or only refinements to these items. The evaluation of this 
factor requires an analysis of the cost content of the proposed contract 
as follows:
    (1) Material acquisition. (Subcontracted items, purchased parts, and 
other material.) Analysis of these cost items shall include an 
evaluation of the managerial and technical effort necessary to obtain 
the required subcontracted items, purchased parts, material or services. 
The contracting officer shall determine whether the contractor will 
obtain the items or services by routine order from readily available 
sources or by detailed subcontracts for which the prime contractor will 
be required to develop complex specifications. Consideration shall also 
be given to the managerial and technical efforts necessary for the prime 
contractor to select subcontractors and to perform subcontract 
administration functions. In application of this criterion, it should be 
recognized that the contribution of the prime contractor to its 
purchasing program may be substantial. Normally, the lowest unadjusted 
weight for direct material is 2 percent. A weighting of less than 2 
percent would be appropriate only in unusual circumstances when there is 
a minimal contribution by the contractor.
    (2) Direct Labor (Professional, service, manufacturing and other 
labor). Analysis of the various labor categories of the cost content of 
the contract should include evaluation of the comparative quality and 
quantity of professional and semiprofessional talents, manufacturing and 
service skills, and experience to be employed. In evaluating 
professional and semiprofessional labor for the purpose of assigning 
profit dollars, consideration should be given to the amount of notable 
scientific talent or

[[Page 72]]

unusual or scarce talent needed in contrast to nonprofessional effort. 
The assessment should consider the contribution this talent will provide 
toward the achievement of contract objectives. Since nonprofessional 
labor is relatively plentiful and rather easily obtained by the 
contractor and is less critical to the successful performance of 
contract objectives, it cannot be weighted nearly as high as 
professional or semiprofessional labor. Service contract labor should be 
evaluated in a like manner by assigning higher weights to engineering or 
professional type skills and lower weights to semiprofessional or other 
type skills required for contract performance. Similarly, the variety of 
manufacturing and other categories of labor skills required and the 
contractor's manpower resources for meeting these requirements should be 
considered. For purposes of evaluation, categories of labor (i.e., 
quality control, receiving and inspection, etc.) which do not fall 
within the definition for professional, service or manufacturing labor 
may be categorized as appropriate. However, the same evaluation 
considerations as outlined above will be applied.
    (3) Overhead and general management (G&A). (i) Analysis of these 
overhead items of cost should include the evaluation of the makeup of 
these expenses and how much they contribute to contract performance. To 
the extent practicable, analysis should include a determination of the 
amount of labor within these overhead pools and how this labor would be 
treated if it were considered as direct labor under the contract. The 
allocable labor elements should be given the same profit considerations 
that they would receive if they were treated as direct labor. The other 
elements of these overhead pools should be evaluated to determine 
whether they are routine expenses, such as utilities and maintenance, 
and hence given lesser profit consideration, or whether they are 
significant contributing elements. The composite of the individual 
determinations in relation to the elements of the overhead pools will be 
the profit consideration given the pools as a whole. The procedure for 
assigning relative values to these overhead expenses differs from the 
method used in assigning values of the direct labor. The upper and lower 
limits assignable to the direct labor are absolute. In the case of 
overhead expenses, individual expenses may be assigned values outside 
the range as long as the composite ratio is within the range.
    (ii) It is not necessary that the contractor's accounting system 
break down overhead expenses within the classifications of research 
overhead, other overhead pools, and general administrative expenses, 
unless dictated otherwise by Cost Accounting Standards (CAS). The 
contractor whose accounting system reflects only one overhead rate on 
all direct labor need not change its system (if CAS exempt) to 
correspond with the above classifications. The contracting officer, in 
an evaluation of such a contractor's overhead rate, could break out the 
applicable sections of the composite rate which could be classified as 
research overhead, other overhead pools, and general and administrative 
expenses, and follow the appropriate evaluation technique.
    (iii) Management problems surface in various degrees and the 
management expertise exercised to solve them should be considered as an 
element of profit. For example, a contract for a new program for 
research or an item which is on the cutting edge of the state of the art 
will cause more problems and require more managerial time and abilities 
of a higher order than a follow-on contract. If new contracts create 
more problems and require a higher profit weight, follow-ons should be 
adjusted downward because many of the problems should have been solved. 
In any event, an evaluation should be made of the underlying managerial 
effort involved on a case-by-case basis.
    (iv) It may not be necessary for the contracting officer to make a 
separate profit evaluation of overhead expenses in connection with each 
acquisition action for substantially the same project with the same 
contractor. Where an analysis of the profit weight to be assigned to the 
overhead pool has been made, that weight assigned may be used for future 
acquisitions with the same contractor until there is a change in the 
cost composition of the overhead

[[Page 73]]

pool or the contract circumstances, or the factors discussed in (iii) 
above are involved.
    (b) Other costs. Analysis of this factor should include all other 
direct costs associated with contractor performance (e.g., travel and 
relocation, direct support, and consultants). Analysis of these items of 
cost should include:
    (1) The significance of the cost of contract performance;
    (2) Nature of the cost; and
    (3) How much they contribute to contract performance. Normally, 
travel costs require minimal administrative effort by the contractor 
and, therefore, usually receive a weight no greater than 1 percent. 
Also, the contractor may designate individuals as ``consultants'' but in 
reality these individuals may be obtained by the contractor to 
supplement its workforce in the performance of routine duties required 
by contract. These costs would normally receive a minimum weight. 
However, there will be instances when the contractor may be required to 
locate and obtain the services of consultants having expertise in such 
fields as medicine or human services. In these instances, the contractor 
will be required to expend greater managerial and technical effort to 
obtain such services and, consequently, such costs should receive a much 
greater weight.



315.905-73  Other factors.

    (a) Contract cost risk. The contract type employed basically 
determines the degree of cost risk assumed by the contractor. For 
example, where a portion of the risk has been shifted to the Government 
through cost-reimbursement provisions, unusual contingency provisions, 
or other risk-reducing measures, the amount of profit should be less 
than where the contractor assumes all the risk. In developing the 
prenegotiation profit objective, the contracting officer will need to 
consider the type of contract anticipated to be negotiated and the 
contractor risk associated therewith when selecting the position in the 
weight range for profit that is appropriate for the risk to be borne by 
the contractor. This factor should be one of the most important in 
arriving at prenegotiation profit objectives.
    (1) Evaluation of this risk requires a determination of:
    (i) The degree of cost responsibility the contractor assumes;
    (ii) The reliability of the cost estimates in relation to the task 
assumed; and
    (iii) The complexity of the task assumed by the contractor. This 
factor is specifically limited to the risk of contract costs. Thus, such 
risks on the part of the contractor as reputation, losing a commercial 
market, risk of losing potential profits in other fields, or any risk 
which falls on the contracting office such as the risk of not acquiring 
a satisfactory report, are not within the scope of this factor.
    (2) The first and basic determination of the degree of cost 
responsibility assumed by the contractor is related to the sharing of 
total risk of contract cost by the Government and the contractor through 
the selection of contract type. The extremes are a cost-plus-a-fixed-fee 
contract requiring the contractor to use its best efforts to perform a 
task and a firm fixed-price contract for a service or a complex item. A 
cost-plus-a-fixed-fee contract would reflect a minimum assumption of 
cost responsibility, whereas a firm fixed-price contract would reflect a 
complete assumption of cost responsibility. Where proper contract 
selection has been made, the regard for risk by contract type would 
usually fall into the following percentage ranges:

                                 Percent

Cost-reimbursement type contracts--0-3
Fixed-price type contracts--2-7

    (3) The second determination is that of the reliability of the cost 
estimates. Sound price negotiation requires well-defined contract 
objectives and reliable cost estimates. Prior experience assists the 
contractor in preparing reliable cost estimates on new acquisitions for 
similar related efforts. An excessive cost estimate reduces the 
possibility that the cost of performance will exceed the contract price, 
thereby reducing the contractor's assumption of contract cost risk.
    (4) The third determination is that of the difficulty of the 
contractor's task. The contractor's task can be difficult

[[Page 74]]

or easy, regardless of the type of contract.
    (5) Contractors are likely to assume greater cost risk only if 
contracting officers objectively analyze the risk incident to proposed 
contracts and are willing to compensate contractors for it. Generally, a 
cost-plus-fixed fee contract will not justify a reward for risk in 
excess of 0.5 percent, nor will a firm fixed-price contract justify a 
reward of less than the minimum in the structured approach. Where proper 
contract-type selection has been made, the reward for risk, by contract 
type, will usually fall into the following percentage ranges:
    (i) Type of contract and percentage ranges for profit objectives 
developed by using the structured approach for research and development 
and manufacturing contracts:

                                 Percent

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

    (ii) 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

    (6) These ranges may not be appropriate for all acquisitions. For 
instance, a fixed-price-incentive contract that is closely priced with a 
low ceiling price and high incentive share may be tantamount to a firm 
fixed-price contract. In this situation, the contracting officer may 
determine that a basis exists for high confidence in the reasonableness 
of the estimate and that little opportunity exists for cost reduction 
without extraordinary efforts. On the other hand, a contract with a high 
ceiling and low incentive formula can be considered to contain cost-
plus-incentive-fee contract features. In this situation, the contracting 
officer may determine that the Government is retaining much of the 
contract cost responsibility and that the risk assumed by the contractor 
is minimal. Similarly, if a cost-plus-incentive-fee contract includes an 
unlimited downward (negative) fee adjustment on cost control, it could 
be comparable to a fixed-price-incentive contract. In such a pricing 
environment, the contracting officer may determine that the Government 
has transferred a greater amount of cost responsibility to the 
contractor than is typical under a normal cost-plus-incentive-fee 
contract.
    (7) The contractor's subcontracting program may have a significant 
impact on the contractor's acceptance of risk under a contract form. It 
could cause risk to increase or decrease in terms of both cost and 
performance. This consideration should be a part of the contracting 
officer's overall evaluation in selecting a factor to apply for cost 
risk. It may be determined, for instance, that the prime contractor has 
effectively transferred real cost risk to a subcontractor and the 
contract cost risk evaluation may, as a result, be below the range which 
would otherwise apply for the contract type being proposed. The contract 
cost risk evaluation should not be lowered, however, merely on the basis 
that a substantial portion of the contract costs represents subcontracts 
without any substantial transfer of contractor's risk.
    (8) In making a contract cost risk evaluation in an acquisition 
action that involves definitization of a letter contract, unpriced 
change orders, and unpriced orders under BOA's, consideration should be 
given to the effect on total contract cost risk as a result of having 
partial performance before definitization. Under some circumstances it 
may be reasoned that the total amount of cost risk has been effectively 
reduced. Under other circumstances it may be apparent that the 
contractor's cost risk remained substantially unchanged. To be 
equitable, the determination of profit weight for application to the 
total of all recognized costs, both those incurred and those yet to be 
expended, must be made with consideration to all attendant 
circumstances--not just the portion of costs incurred or percentage

[[Page 75]]

of work completed prior to definitization.
    (9) Time and material and labor hour contracts will be considered to 
be cost-plus-a-fixed-fee contracts for the purpose of establishing 
profit weights unless otherwise exempt under 315.905-70(b) in the 
evaluation of the contractor's assumption of contract cost risk.
    (b) Investment. HHS encourages its contractors to perform their 
contracts with the minimum of financial, facilities, or other assistance 
from the Government. As such, it is the purpose of this factor to 
encourage the contractor to acquire and use its own resources to the 
maximum extent possible. The evaluation of this factor should include an 
analysis of the following:
    (1) Facilities (Including equipment). To evaluate how this factor 
contributes to the profit objective requires knowledge of the level of 
facilities utilization needed for contract performance, the source and 
financing of the required facilities, and the overall cost effectiveness 
of the facilities offered. Contractors who furnish their own facilities 
which significantly contribute to lower total contract costs should be 
provided with additional profit. On the other hand, contractors who rely 
on the Government to provide or finance needed facilities should receive 
a corresponding reduction in profit. Cases between the above examples 
should be evaluated on their merits with either positive or negative 
adjustments, as appropriate, in profit being made. However, where a 
highly facilitized contractor is to perform a contract which does not 
benefit from this facilitization or where a contractor's use of its 
facilities has a minimum cost impact on the contract, profit need not be 
adjusted. When applicable, the prospective contractor's computation of 
facilities capital cost of money for pricing purposes under CAS 414 can 
help the contracting officer identify the level of facilities investment 
to be employed in contract performance.
    (2) Payments. In analyzing this factor, consideration should be 
given to the frequency of payments by the Government to the contractor. 
The key to this weighting is to give proper consideration to the impact 
the contract will have on the contractor's cash flow. Generally, 
negative consideration should be given for advance payments and payments 
more frequent than monthly with maximum reduction being given as the 
contractor's working capital approaches zero. Positive consideration 
should be given for payments less frequent than monthly with additional 
consideration given for a capital turn-over-rate on the contract which 
is less than the contractor's or the industry's normal capital turn-over 
rate.
    (c) Performance. (Cost-control and other past accomplishments.) The 
contractor's past performance should be evaluated in such areas as 
quality of service or product, meeting performance schedules, efficiency 
in cost control (including need for and reasonableness of cost 
incurred), accuracy and reliability of previous cost estimates, degree 
of cooperation by the contractor (both business and technical), timely 
processing of changes and compliance with other contractual provisions, 
and management of subcontract programs. Where a contractor has 
consistently achieved excellent results in the foregoing areas in 
comparison with other contractors in similar circumstances, such 
performance merits a proportionately greater opportunity for profit. 
Conversely a poor record in this regard should be reflected in 
determining what constitutes a fair and reasonable profit.
    (d) Federal socioeconomic programs. This factor, which may apply to 
special circumstances or particular acquisitions, relates to the extent 
of a contractor's successful participation in the Government sponsored 
programs such as small business, small disadvantaged business, labor 
surplus area, and energy conservation efforts. The contractor's policies 
and procedures which energetically support Government socioeconomic 
programs and achieve successful results should be given positive 
considerations. Conversely, failure or unwillingness on the part of the 
contractor to support Government socioeconomic programs should be viewed 
as evidence of poor performance for the purpose of establishing a profit 
objective.
    (e) Special situations. (1) Inventive and developmental 
contributions. The extent

[[Page 76]]

and nature of contractor-initiated and financed independent development 
should be considered in developing the profit objective, provided that 
the contracting officer has made a determination that such effort will 
benefit the contract. The importance of the development in furthering 
health and human services purposes, the demonstrable initiative in 
determining the need and application of the development, the extent of 
the contractor's cost risk, and whether the development cost was 
recovered directly or indirectly from Government sources should be 
weighed.
    (2) Unusual pricing agreements. Occasionally, unusual contract 
pricing arrangements are made with the contractor wherein it agrees to 
cost ceilings, e.g., a ceiling on overhead rates for conditions other 
than those discussed at FAR 42.707. In such circumstances, the 
contractor should receive favorable consideration in developing the 
profit objective.
    (3) Negative factors. Special situations need not be limited to 
those which only increase profit levels. A negative consideration may be 
appropriate when the contractor is expected to obtain spin-off benefits 
as a direct result of the contract (e.g., products or services with 
commercial application).
[49 FR 13979, Apr. 9, 1984, as amended at 53 FR 15563, May 2, 1988]



315.905-74  Facilities capital cost of money.

    When facilities capital cost of money (cost of capital committed to 
facilities) is included as an item of cost in the contractor's proposal, 
a reduction in the profit objective shall be made in an amount equal to 
the amount of facilities capital cost of money allowed in accordance 
with the Facilities Capital Cost-of-Money Cost Principal. If the 
contractor does not propose this cost, a provision must be inserted in 
the contract that facilities capital cost of money is not an allowable 
cost.
[49 FR 13979, Apr. 9, 1984, as amended at 53 FR 15563, May 2, 1988]



Subpart 315.10--Preaward, Award, and Postaward Notifications, Protests, 
                              and Mistakes



315.1000  General.

    Once a contract action has progressed through the evaluation 
process, and even after the selection of a contractor, all queries as to 
the relative merits of the submitted proposals shall be courteously but 
firmly directed to the contracting officer. All other personnel will 
avoid any exchange of comments with offerors.
[49 FR 13979, Apr. 9, 1984. Redesignated and amended at 50 FR 23132, May 
31, 1985; 50 FR 38004, Sept. 19, 1985]



315.1003  Debriefing of unsuccessful offerors.

    (a) Any HHS employee who receives either a written or oral request 
for a debriefing from an unsuccessful offeror shall immediately, without 
any discussion regarding the merits or deficiencies of the unsuccessful 
offeror's proposal, refer the request to the contracting officer. If the 
request is made orally, the contracting officer shall require that the 
request be made in writing. The contracting officer or his/her designee 
shall be present at all debriefings and shall review written debriefings 
prior to release.
    (b) A debriefing is intended to: (1) Tell an unsuccessful offeror 
which areas of its proposal were judged to be weak and deficient and 
whether the weaknesses or deficiencies were factors in its not having 
been selected; and
    (2) Identify the factors which were the basis for selection of the 
successful contractor. If the quality of the successful offeror's 
proposal to satisfy the mission requirement was the basis, the 
unsuccessful offeror should be so informed, and given a general 
comparison of significant areas, but not a point-by-point comparison of 
all the elements considered in the evaluation criteria. If the 
successful offeror was selected on the basis of cost, the unsuccessful 
offeror should be told that was the case. If selection was based on 
other factors, they should be specified.

[[Page 77]]

    (d) If an unsuccessful offeror feels that its failure to obtain the 
award was not justified, it will rely, at least in part, on the 
information given in the debriefing to determine whether it should seek 
recourse. Accordingly, it is essential that a debriefing be conducted in 
a scrupulously fair, objective, and impartial manner, and that the 
information given the unsuccessful offeror be absolutely factual and 
consistent with the findings of the contracting officer and the basis on 
which the award was made.
    (e) In some cases, it may be necessary to arrange informal 
debriefings for an unsuccessful offeror's personnel by departmental 
technical evaluators. This determination will be made by, and meeting 
arrangements will be the responsibility of, the contracting officer.
    (f) It is very important that all departmental personnel engaged in 
the evaluation and selection processes be aware of the policies and 
procedures in FAR Subpart 15.10 and this Subpart 315.10. Detailed and 
complete records of the acquisition will be maintained by key technical 
and contracting personnel in a manner which will facilitate either a 
written or an oral debriefing of any unsuccessful offeror.
[49 FR 13979, Apr. 9, 1984. Redesignated and amended at 50 FR 23132, May 
31, 1985; 50 FR 38004, Sept. 19, 1985]



315.1004  Protests against award.

    See Subpart 333.1.
[49 FR 13979, Apr. 9, 1984. Redesignated and amended at 50 FR 23132, May 
31, 1985; 50 FR 38004, Sept. 19, 1985]



315.1005  Discovery of mistakes.

    See 314.406 and 315.607.
[49 FR 13979, Apr. 9, 1984. Redesignated at 50 FR 23132, May 31, 1985; 
50 FR 38004, Sept. 19, 1985]



                  Subpart 315.70--Requests for Contract



315.7000  Scope of subpart.

    This subpart prescribes the format and contents of the request for 
contract and provides procedures for the preparation and submission of 
the request for contract document.



315.7001  General.

    The program office's preparation of the request for contract (RFC) 
and submission to the contracting activity finalizes the presolicitation 
phase of the acquisition planning process and commences the solicitation 
phase. The RFC is the formal document which initiates the preparation of 
the request for proposals by the contracting activity and sets the 
acquisition process in motion. It represents the results of planning by 
the project officer and contract negotiator and contains much of the 
pertinent information necessary for the development of a sound, 
comprehensive RFP.



315.7002  Procedures.

    (a) Requests for contract are required to be prepared by the program 
office for all proposed negotiated acquisitions estimated to exceed the 
small purchase limitation.
    (b) The program office should submit the RFC as early as possible to 
the contracting activity. The proposed period of time between the date 
of submission of the RFC and the date of contract award (or date of 
delivery of the product, service, study, etc.) should be determined by 
the project officer, contract negotiator, and, if necessary, the 
contracting officer. The amount of leadtime should be determined on a 
case-by-case basis and should reflect the characteristics and 
complexities of the individual acquisition. When lengthy and/or involved 
clearances or special approval are required, for example, they must be 
taken into account when the leadtime is determined. If a formal 
acquisition planning document is used, (see Subpart 307.1), the RFC 
should be submitted in accordance with the timetable set forth in that 
document. OPDIV, agency, and regional office contracting activities may 
prescribe specific leadtimes for submission of RFC's in their 
implementation of this subpart.
[49 FR 13979, Apr. 9, 1984, as amended at 53 FR 15563, May 2, 1988; 56 
FR 47003, Sept. 17, 1991]



315.7003  Responsibilities.

    It is the responsibility of the project officer to prepare the RFC 
so that it

[[Page 78]]

complies with the requirements of this subpart and any OPDIV, agency, or 
regional office guidance issued in accordance with this subpart. Prior 
to the submission of the RFC to the contracting activity, the head of 
the program office sponsoring the project shall review the RFC to ensure 
that all required information is provided in the prescribed format and a 
technical review of the statement of work has been made. The level and 
extent of the technical review is to be commensurate with the estimated 
cost, importance, and complexity of the proposed acquisition, and must 
be thorough enough to ensure that vague and ambiguous language is 
eliminated, the statement of work is structured by phases or tasks, if 
appropriate, and methods are available for assessing the contractor's 
technical, cost, and delivery performances.



315.7004  Transmittal.

    The RFC will be conveyed to the contracting activity by use of a 
covering memorandum or other form of transmittal. The transmittal 
document must be signed by the head of the sponsoring program office and 
include both a statement attesting to the conclusiveness of the review 
discussed in the preceding section and a list identifying all 
attachments to the RFC. A standard format for the transmittal document 
may be prescribed by the OPDIV, agency, or regional office contracting 
activity.



315.7005  Format and content.

    The Department does not prescribe a standard format for the RFC 
document, but recommends the use of a format similar to what is provided 
in this section. The subject areas addressed in paragraphs (a) and (b) 
must be included in every RFC document, whereas the areas addressed in 
paragraph (c) need only be included if applicable. An OPDIV, agency, or 
regional office contracting activity may prescribe a standard format for 
the RFC document and may include additional subject areas that are 
pertinent to that activity's needs. Some of the information to be 
furnished in the RFC document may be repetitive of that found in the 
acquisition planning document. If this information has not changed since 
the development of the acquisition planning document, the RFC document 
may either restate the information as it appears in the acquisition 
planning document or cross reference the applicable portion where the 
information appears.
    (a) The RFC document must contain the following:
    (1) Purpose of contract. A brief, general description of 
requirements, including the citation of the legislation which authorizes 
the program or project, is to be provided, along with a statement as to 
the intended purpose/use of the proposed contract.
    (2) Background and need. The background history and necessity for 
the proposed contract are to be described. This section is to include 
prior, present, and planned efforts by the program office in the same or 
related areas, and a description of efforts by other departmental 
activities and Federal agencies in the same or related program areas, if 
known. In addition, specific project information such as the relevance 
or contribution to overall program objectives, reasons for the need, 
priority, and project overlap are to be provided.
    (3) Period of performance. The number of months (or other time 
period) required for total performance, and, if applicable, for each 
phase of work indicated in the statement of work, is to be specified. 
The program office must indicate the proposed starting date and the 
required date of delivery for each deliverable.
    (4) Estimated cost and fund citation. The project officer's estimate 
of the total cost of the proposed contract, and, if applicable, the 
estimate for each phase indicated in the statement of work, is to be 
provided. The project officer must provide a cost breakdown of all 
contributing cost factors, to include an estimate of the technical staff 
hours, direct materials, subcontracting, travel, etc. The project 
officer may consult with contracting and cost advisory personnel in 
developing this information. This section must include the certification 
of funds availability for the particular proposed acquisition, along 
with the appropriation and accounting information citations. When funds 
are not currently available but

[[Page 79]]

are anticipated, a statement indicating that the financial plan includes 
provision for the funds for the proposed acquisition but the funds are 
not yet available for obligation shall be included in lieu of the 
certification of funds availability. (Contracts cannot be awarded unless 
funds are available, but see FAR 32.703-2.)
    (5) Reference material. A list, by title and description, of study 
reports, plans, drawings, and other data to be made available to 
prospective offerors for use in preparation of proposals and/or the 
contractor for use in performance of the contract is to be provided. The 
project officer must indicate whether this material is currently 
available or when it will be available.
    (6) Technical evaluation criteria and instructions. The project 
officer is to include the technical evaluation criteria, which have been 
developed based on the requirements of the specific project, and any 
instructions and information which will assist in the preparation of 
prospective offerors' technical proposals. For example, critical areas 
discussed in the statement of work and the relative order of importance 
and weights assigned to each of these areas for technical evaluation 
purposes must be identified. These areas may include understanding of 
the problem, technical approach, experience, personnel, facilities, etc.
    (7) Sources for solicitation. The project officer is to develop and 
include a list of known potential sources by name and mailing address. 
The project officer is encouraged to use trade and professional journals 
and publications to identify new prospective sources to supplement the 
list of known sources. Efforts to identify set-aside possibilities, 
i.e., small, disadvantaged, and labor surplus areas, and women-owned 
businesses, must be explained.
    (8) Special approvals, clearances, and requirements. All special 
approvals, clearances, and requirements pertinent to the proposed 
acquisition are to be listed in this section. Copies of the actual 
documents are to be attached to the RFC. If the approval, clearance, or 
requirement has been requested and is being processed, a footnote to 
this effect, including all pertinent details, must be included in this 
section. A list of Government-wide and Department imposed approvals, 
clearances, and requirements is set forth in 307.105-2. Comprehensive 
checklists of these and any OPDIV, agency, regional office, etc. special 
approvals, clearances, and requirements shall be provided for reference 
purposes to program offices by the servicing contracting activity.
    (9) Identification and disposition of data. The project officer must 
identify the data expected to be generated by the acquisition and 
specify the data to be delivered to the Department (see 315.7005(b)(2)) 
and that to be retained by the contractor. The project officer must also 
include information relative to the use, maintenance, disclosure, and 
disposition of data. The project officer must include a statement as to 
whether or not another acquisition, based upon the data generated by the 
proposed acquisition, is anticipated. The project officer must also 
include a statement indicating whether the proposed acquisition is or is 
not subject to the Privacy Act (see FAR Subpart 24.1 and Subpart 324.1).
    (10) Project officer and alternate. The project officer's name, 
title, organization, mailing address, and telephone number are to be 
provided in this section, along with the same data for the project 
officer's alternate. In addition, a statement that the project officer 
has completed the Department's project officer training course is to be 
provided (see 307.170).
    (b) The following must be submitted with every RFC but are to be 
prepared as separate attachments so they may be readily adopted into the 
request for proposal format:
    (1) Statement of work or specification. The statement of work 
describes the requirements to be performed and may describe the methods 
to be used (see 307.105-3 and FAR 35.005 for a detailed explanation). A 
specification is used in lieu of a statement of work when a clear and 
accurate description of the technical requirements for a product, 
material, or service can be provided along with the procedure to 
determine that the requirements have been met. It is essential that a 
complete and comprehensive statement of work or specification be 
provided by the project officer.

[[Page 80]]

    (2) Schedule of deliverables or reporting requirements. The project 
officer must specifically describe what is to be delivered and when it 
is to be delivered to ensure proper contract monitoring. Usually, 
technical and financial progress reports and the final report are 
prescribed in this section. These reports should be tailored to the 
instant acquisition and should avoid unnecessary and burdensome 
reporting requirements.
    (c) The following may not be applicable to all RFC's but must be 
included as attachments whenever any do apply:
    (1) Government property. The project officer must identify, as 
referenced in the statement of work, the types, individual items, and 
quantities of Government property to be furnished to or allowed to be 
acquired by, the resultant contractor, if known. The project officer 
must specify when the Government property is to be made available to the 
resultant contractor.
    (2) Special terms and conditions. The project officer may suggest 
inclusion of any special terms and conditions applicable to the proposed 
acquisition not already covered in the statement of work or the 
applicable contract general provisions.
    (3) Justification for other than full and open competition. If the 
proposed acquisition is to be awarded using other than full and open 
competition, a justification, prepared in accordance with FAR Subpart 
6.3 and Subpart 306.3, must be submitted as an attachment to the RFC.
    (4) Privacy Act ``system notice.'' When the project officer has 
determined that the requirements of the Privacy Act are applicable to 
the proposed acquisition, a copy of the ``system notice'' must be 
attached to the RFC (see 324.103(d)).
[49 FR 13979, Apr. 9, 1984, as amended at 50 FR 23132, May 31, 1985; 50 
FR 38004, Sept. 19, 1985]



315.7006  Review.

    Upon receipt of the RFC, the contracting activity shall review the 
contents to ensure that all pertinent information has been provided by 
the program office. If pertinent information is missing or if there are 
discrepancies in previously agreed upon information, such as significant 
alterations in the statement of work, the contracting activity shall 
obtain or clarify the information so that the acquisition schedule is 
met. If the program office delays furnishing the information or 
clarification, the acquisition schedule may have to be changed. When 
this circumstance arises, the contracting activity should notify the 
head of the sponsoring program office of the problem, in writing, of the 
possible slippage in the acquisition schedule, and the need for an 
expeditious remedy. If the head of the sponsoring program office is not 
responsive to the request for expediency, the matter should be referred 
to higher management authorities for resolution.
[49 FR 13979, Apr. 9, 1984, as amended at 49 FR 36110, Sept. 14, 1984]



PART 316--TYPES OF CONTRACTS--Table of Contents




               Subpart 316.3--Cost-Reimbursement Contracts

Sec.
316.301  General.
316.301-3  Limitations.
316.303  Cost-sharing contracts.
316.306  Cost-plus-fixed-fee contracts.
316.307  Contract clauses.

                   Subpart 316.4--Incentive Contracts

316.403  Fixed-price incentive contracts.

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

316.601  Time-and-materials contracts.
316.603  Letter contracts.
316.603-2  Application.
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

316.702  Basic agreements.
316.770  Unauthorized types of agreements.
316.770-1  Letters of intent.
316.770-2  Memorandums of understanding.

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

    Source:  49 FR 14004, Apr. 9, 1984, unless otherwise noted.

[[Page 81]]



               Subpart 316.3--Cost-Reimbursement Contracts



316.301  General.



316.301-3  Limitations.

    (c) The following format shall be used and executed by the 
contracting officer as the determination and findings authorizing the 
use of a cost-reimbursement contract and establishing the fee:

   Department of Health and Human Services--Determination and Findings

              Authority to Use Cost-Reimbursement Contract

    I hereby find that:
    (1) The (agency title) proposes to contract with (name of proposed 
contractor) for (describe work, service, or product) (identify program 
or project). The estimated cost is ($------) (if contract is CPFF type, 
insert, ``plus a fixed fee of ($------) which is ---- percent of the 
estimated cost exclusive of fee'').
    (2) (Set forth facts and circumstances that show why it is 
impracticable to secure property or services of the kind or quantity 
required without the use of the proposed type of contract or why the 
proposed method of contracting is likely to be less costly than other 
methods.) I hereby determine that:
    On the basis of the above findings, and in accordance with FAR 
16.301-3, it is impracticable to secure the property or services of the 
kind or quality required without the use of a (cost, cost-sharing, or 
cost-plus-a-fixed fee*) type of contract, or the (cost, cost-sharing, or 
cost-plus-a-fixed fee*) method of contracting is likely to be less 
costly than other methods.
---------------------------------------------------------------------------


    *Use applicable word, words, or statement.
---------------------------------------------------------------------------

 Date___________________________________________________________________
 Signature______________________________________________________________
[49 FR 14004, Apr. 9, 1984, as amended at 50 FR 23132, May 31, 1985; 50 
FR 38004, Sept. 19, 1985; 51 FR 44294, Dec. 9, 1986]



316.303  Cost-sharing contracts.

    For detailed information concerning the use of cost-sharing 
contracts, see 335.070.



316.306  Cost-plus-fixed-fee contracts.

    (c)(2) The determination and findings (D&F) required by FAR 
16.306(c)(2) has been combined with the D&F required by FAR 16.301-3(c) 
authorizing the use of cost-reimbursement contract, and is shown in 
316.301-3(c). The contracting officer is responsible for executing the 
D&F and is authorized to make both determinations required by the FAR.
[51 FR 44294, Dec. 9, 1986]



316.307  Contract clauses.

    (a) If the contract is with a hospital (profit or nonprofit), modify 
the ``Allowable Cost and Payment'' clause at FAR 52.216-7 by deleting 
from paragraph (a) the words ``subpart 31.2 of the Federal Acquisition 
Regulation (FAR)'' and substituting ``45 CFR part 74 appendix E.''
    (j) The contracting officer shall insert the clause at 352.216-72, 
Additional Cost Principles, in solicitations and resultant cost-
reimbursement contracts with nonprofit organizations, as identified in 
OMB Circular A-122.
[55 FR 42197, Oct. 18, 1990]



                   Subpart 316.4--Incentive Contracts



316.403  Fixed-price incentive contracts.

    (c) The determination and findings required by FAR 16.403(c) shall 
be executed by the chief of the contracting office after it is prepared 
by the contracting officer.
[51 FR 44294, Dec. 9, 1986]



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



316.601  Time-and-materials contracts.

    (c) Limitations. The format prescribed in 316.301-3(c) shall be used 
and executed by the contracting officer as the determination and 
findings authorizing the use of either a time-and-materials contract or 
a labor-hour contract, except that the final paragraph shall be changed 
to read as follows:

    I hereby determine that:
    On the basis of the above findings, no other type of contract will 
suitably serve for the acquisition of the required work or services.



316.603  Letter contracts.



316.603-2  Application.

    It is the policy of the Department to refrain from issuing letter 
contracts.

[[Page 82]]

Exceptions to this policy will be permitted only in those cases where 
all matters of a substantive nature, such as statements of work, 
delivery schedules, and general and special clauses have been resolved 
and agreed upon.



316.603-3  Limitations.

    The principal official responsible for acquisition shall be the 
approving official who executes the prescribed written statement. 
However, if the principal official responsible for acquisition is to 
sign the letter contract as the contracting officer, the approving 
official becomes the head of the contracting activity.
[49 FR 14004, Apr. 9, 1984, as amended at 51 FR 44294, Dec. 9, 1986]



316.603-70  Information to be furnished when requesting authority to issue a letter contract.

    The following information should be included by the contracting 
officer in any memorandum requesting approval to issue a letter 
contract:
    (a) Name and address of proposed contractor.
    (b) Location where contract is to be performed.
    (c) Contract number, including modification number, if possible.
    (d) Brief description of work and services to be performed.
    (e) Performance or delivery schedule.
    (f) Amount of letter contract.
    (g) Estimated total amount of definitized contract.
    (h) Type of definitive contract to be executed (fixed price, cost-
reimbursement, etc.).
    (i) Statement of the necessity and advantage to the Government of 
the use of the proposed letter contract.
    (j) Statement of percentage of the estimated cost that the 
obligation of funds represents. In rare instances where the obligation 
represents 50 percent or more of the proposed estimated cost of the 
acquisition, a justification for that obligation must be included which 
would indicate the basis and necessity for the obligation (e.g., the 
contractor requires a large initial outlay of funds for major 
subcontract awards or an extensive purchase of materials to meet an 
urgent delivery requirement). In every case, documentation must assure 
that the amount to be obligated is not in excess of an amount reasonably 
required to perform the work.
    (k) Period of effectiveness of the proposed letter contract. If more 
than 180 days, complete justification must be given.
    (l) Statement of any substantive matters that need to be resolved.



316.603-71  Approval for modifications to letter contracts.

    All letter contract modifications (amendments) must be approved by 
the principal official responsible for acquisition. Requests for 
authority to issue letter contract modifications shall be processed in 
the same manner as requests for authority to issue letter contracts and 
shall include the following:
    (a) Name and address of the contractor.
    (b) Description of work and services.
    (c) Date original request was approved and indicate approving 
official.
    (d) Letter contract number and date issued.
    (e) Complete justification as to why the letter contract cannot be 
definitized at this time.
    (f) Complete justification as to why the level of funding must be 
increased.
    (g) Complete justification as to why the period of effectiveness is 
increased beyond 180 days, if applicable.
    (h) If the funding of the letter contract is to be increased to more 
than 50 percent of the estimated cost of the acquisition, the 
information required by 316.603-70(j) must be included.



                        Subpart 316.7--Agreements



316.702  Basic agreements.

    (b) Application.
    (2) Basic agreements shall continue in effect until termination, 
supersession, or expiration of the term.
    (d) Contracts incorporating basic agreements.
    (2) Any provision of a contract which conflicts with the terms of a 
basic agreement must be approved by the Director, Division of 
Acquisition Policy, OAGM.

[[Page 83]]

    (4) Basic agreements may include negotiated overhead rates for cost-
reimbursement type contracts. Where negotiated overhead rates are 
included, the bases to which the rates apply and the period of 
applicability must also be stated. All pertinent provisions such as 
final rates for past periods, provisional rates for current or future 
periods, ceilings, and any specific items to be treated as indirect 
costs shall also be included as appropriate.
    (e) Content and format. A basic agreement shall consist of an 
execution page(s), contents page, special provisions, and general 
provisions. The following is illustrative of an execution page:

Basic Agreement    Page 1 of--
Number              pages

Basic Agreement
    Between the United States of America, as represented by the 
Department of Health and Human Services, and (Name of Contractor), this 
agreement, effective (Insert Date) by and between the United States of 
America, hereinafter called the ``Government,'' as represented by the 
Department of Health and Human Services, and (Name of Contractor), a 
corporation organized and existing under the laws of the (State/
Commonwealth) of -------- with its principal office in (City, State), 
hereinafter called the ``Contractor''.

                             Witnesseth That

    Whereas, the Government and the Contractor desire to enter into a 
single basic agreement for use only in connection with negotiated 
(insert type of contract and categories of effort that the basic 
agreement will cover) entered into on or after the effective date of 
this Agreement, and prior to its termination; and
    Whereas, the parties understand that this Agreement shall not in any 
manner provide for or imply any agreement on the part of the Government 
to place future orders or contracts with the Contractor.
    Now therefore, the Government and the Contractor agree that the 
provisions and clauses of the Special Provisions, as set forth herein, 
and the General Provisions, as set forth and modified herein, shall be 
incorporated in and constitute the terms and conditions applicable to 
all negotiated (insert type of contract and categories of effort that 
the basic agreement will cover) entered into on or after the effective 
date of this Agreement, and prior to its termination.
    In witness whereof, the parties hereto have executed this Agreement 
as of the day and year first above written.
            United States of America
 Name of Contractor_____________________________________________________
 _______________________________________________________________________
Signature of Contracting Officer
 By_____________________________________________________________________
Signature of Authorized Official
 Typed name_____________________________________________________________
 Typed name_____________________________________________________________
 Date___________________________________________________________________

    (f) Procedures. (1) Negotiation of basic agreements may be 
undertaken by OPDIV contracting activities on behalf of the Department. 
When an OPDIV contracting activity decides to negotiate a basic 
agreement with an organization, prior authorization must be requested, 
in writing, from the Director, Division of Acquisition Policy (DAP). 
When the Director, DAP, gives written authorization to the OPDIV 
contracting activity designated to conduct negotiations on behalf of the 
Department, all other OPDIVs will be notified of this designation. If 
another OPDIV elects, it may attend the negotiation or furnish special 
terms and conditions or provisions for inclusion in the proposed basic 
agreement by advising the designated negotiating activity in writing 
within ten (10) days from the date of the authorization. After review 
and resolution of all requests for inclusion of special terms and 
conditions or provisions, the designated negotiating activity will 
invite those OPDIVs which expressed an interest in attending the 
negotiations and make the necessary arrangements for the negotiation of 
the basic agreement.
    (2) Prior to the conclusion of negotiations, the designated 
negotiating activity shall furnish the OPDIVs a draft copy of the 
proposed basic agreement together with:
    (i) A resume of all salient features of the basic agreement which 
will facilitate review;
    (ii) Any of the negotiating OPDIV's guides or procedures which are 
being considered for incorporation into the basic agreement by 
reference;
    (iii) A listing of nonstandard clauses used, the genesis of such 
clauses, and the reasons for such clauses in the basic agreement; and
    (iv) The contractor's comments, including the basis for requesting 
any deviation from the HHSAR and the designated negotiating activity's 
position with respect thereto.

[[Page 84]]

    (3) The OPDIVs shall have fifteen (15) days from the date of the 
memorandum transmitting the information to submit comments on the draft 
copy of the basic agreement. After receipt, analysis, and resolution of 
the comments of the OPDIVs, the designated negotiating activity will 
proceed to conclude the negotiation of the basic agreement.
    (4) After conclusion of the negotiation, but prior to execution of 
the basic agreement, a copy of the basic agreement, together with the 
information specified in paragraph (f)(2) above, the comments of the 
OPDIVs, the designated negotiating activity's analysis of the OPDIV 
comments, and the basis for the action taken will be furnished to the 
Director, DAP for review by DPP and the Office of General Counsel. 
Approval by the Director, DAP must be given prior to the execution of 
the basic agreement. After approval and execution of the basic 
agreement, the designated negotiating activity will distribute the 
executed document to the OPDIVs, Office of General Counsel, and the 
Director, DAP. The basic agreement is mandatory for use by all 
activities of the Department for all acquisitions falling within the 
scope of the basic agreement.
[49 FR 14004, Apr. 9, 1984, as amended at 50 FR 23126, 23133, May 31, 
1985; 50 FR 38004, Sept. 19, 1985; 54 FR 24343 June 7, 1989; 54 FR 
24343, June 7, 1989]



316.770  Unauthorized types of agreements.



316.770-1  Letters of intent.

    A letter of intent is an informal unauthorized agreement between the 
Government and a prospective contractor which indicates that products or 
services will be produced after completion of funding and/or other 
contractual formalities. Letters of intent are often solicited by 
prospective contractors or may be originated by Government personnel. 
Letters of intent are not authorized by the FAR and are prohibited for 
use by Department personnel.



316.770-2  Memorandums of understanding.

    A ``memorandum of understanding'' is an unauthorized agreement, 
usually drafted during the course of negotiations, to modify mandatory 
FAR and HHSAR provisions in such a manner as to make them more 
acceptable to a prospective contractor. It may be used to bind the 
contracting officer in attempting to exercise rights given the 
Government under the contract, or may contain other matters directly 
contrary to the language of the solicitation or prospective contractual 
document. Use of such memorandums of understanding is not authorized. 
Any change in a solicitation or contract shall be made by amendment or 
modification to that document. When a change to a prescribed contract 
clause is considered necessary, a deviation shall be requested.



PART 317--SPECIAL CONTRACTING METHODS--Table of Contents




                         Subpart 317.2--Options

Sec.
317.201  Definition.
317.202  Use of options.
317.203  Solicitations.
317.206  Evaluation.

                Subpart 317.70--Consolidated Acquisitions

317.7001  General.
317.7002  Policy.

  Subpart 317.71--Supply and Service Acquisitions Under the Government 
                          Employees Traning 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:  49 FR 14006, Apr. 9, 1984, unless otherwise noted.



                         Subpart 317.2--Options



317.201  Definition.

    (a) An option must:
    (1) Identify the supplies or services as a discrete option quantity 
in addition to the basic quantity of supplies or services to be 
delivered under the initial contract award;
    (2) Establish a price or specify a method of calculation which will 
make the price certain;
    (3) Be agreed to and included in the initial contract award; and

[[Page 85]]

    (4) Permit the Government the right to exercise the option 
unilaterally.
    (b) Contract provisions which provide the Government the right to 
buy additional requirements, subject to the written agreement of the 
contractor, do not meet the requirements of paragraph (a)(4) of this 
section and are not authorized. Further, any contract provision which 
merely extends the initial contract period without requiring delivery of 
additional supplies or services is not an option.



317.202  Use of options.

    (c)(6) The primary purpose for inclusion would be the achievement of 
administrative convenience.



317.203  Solicitations.

    (g)(2) When unusual circumstances exist, the principal official 
responsible for acquisition (not delegable) may approve a greater 
percentage (but see FAR 17.205).



317.206  Evaluation.

    The determination referenced in FAR 17.206(b) shall be made by the 
chief of the contracting office.
[49 FR 14006, Apr. 9, 1984, as amended at 53 FR 43208, Oct. 26, 1988]



                Subpart 317.70--Consolidated Acquisitions



317.7001  General.

    Studies have indicated that substantial savings can be realized 
through centralized and consolidated acquisitions of common use 
supplies, services, and equipment. The Department has identified common 
use items and has applied the principle of consolidated acquisition to 
these items.



317.7002  Policy.

    (a) The following supplies, services, and equipment have been 
indentified as common use items and are to be acquired by the 
centralized contracting activity identified in paragraph (b):
    (1) Administrative supplies, equipment, and services (i.e., general 
use office items or related services), as distinguished from functional 
or program requirements.
    (2) Automated data processing services (but see ADP Systems Manual, 
Chapter 4).
    (3) Stenographic reporting services.
    (4) Visual arts, graphics, and supplementing services.
    (5) Press clipping services.
    (b) Activities within the metropolitan Washington, DC area are 
required to submit purchase requests for the above items to the 
applicable centralized contracting activity as follows:
    (1) Activities located in the Southwest Washington complex; 
Procurement Branch, Division of Contract Operations, Office of 
Acquisition and Grants Management, Office of the Secretary.
    (2) Parklawn Complex, Rockville, Maryland (Montgomery and Prince 
Georges Counties area); Division of Acquisition Management, 
Administrative Services Center, Office of Management, Public Health 
Service.
    (3) National Institutes of Health; Division of Procurement, National 
Institutes of Health.
    (c) Activities outside the metropolitan Washington, DC area are 
encouraged to establish centralized points to conduct acquisitions for 
common use items.
[49 FR 14006, Apr. 9, 1984, as amended at 54 FR 24343, June 7, 1989; 55 
FR 13536, Apr. 11, 1990]



  Subpart 317.71--Supply and Service Acquisitions Under the Government 
                         Employees Training Act

    Source:  53 FR 43208, Oct. 26, 1988, unless otherwise noted.



317.7100  Scope of subpart.

    This subpart provides alternate methods for obtaining training in 
non-Government facilities under the Government Employees Training Act, 5 
U.S.C. chapter 41.



317.7101  Applicable regulations.

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

[[Page 86]]



317.7102  Acquisition of training.

    (a) The acquisition of interagency training courses and non-
governmental off-the-shelf training courses, whether for individual 
employees or for groups of employees, is the responsibility of the 
Assistant Secretary for Personnel Administration.
    (b) Non-governmental training must be acquired through the 
contracting office if there are costs for training course development or 
for modification of off-the-shelf training courses.

[[Page 87]]



                  SUBCHAPTER D--SOCIOECONOMIC PROGRAMS





PART 319--SMALL BUSINESS AND SMALL DISADVANTAGED BUSINESS CONCERNS--Table of Contents




                         Subpart 319.2--Policies

Sec.
319.201  General policy.
319.201-70  Small and disadvantaged business utilization specialist.
319.270  Federal acquisition conferences.

              Subpart 319.5--Set-Asides for Small Business

319.501  General.
319.503  Setting aside a class of acquisitions.
319.503-70  Small business class set-aside for construction, repair, and 
          alteration work.
319.505  Rejecting set-aside recommendations.
319.506  Withdrawing or modifying set-asides.
319.570  Contract payments.

      Subpart 319.7--Subcontracting With Small Business and Small 
                     Disadvantaged Business Concerns

319.705  Responsibilities of the contracting officer under the 
          subcontracting assistance program.
319.705-2  Determining the need for a subcontracting plan.
319.705-3  Preparing the solicitation.
319.705-4  Reviewing the subcontracting plan.
319.705-5  Awards involving subcontracting plans.
319.705-6  Postaward responsibilities of the contracting officer.
319.706  Responsibilities of the cognizant administrative contracting 
          officer.

 Subpart 319.8--Contracting with the Small Business Administration (the 
                              8(a) Program)

319.800  General.
319.803  Selecting acquisitions for the 8(a) Program.
319.812  Contract administration.
319.870  Liaison with the Small Business Administration.

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

    Source:  49 FR 14007, Apr. 9, 1984, unless otherwise noted.



                         Subpart 319.2--Policies



319.201  General policy.

    (c) The functional management responsibilities for the Department's 
small business, disadvantaged business, and labor surplus area programs 
are delegated to the Director of the Office of Small and Disadvantaged 
Business Utilization (OSDBU).
    (1) The Director, OSDBU is responsible for:
    (i) Recommending to the Under Secretary overall Department-wide 
operating concepts and policies relating to the Department's small 
business, disadvantaged business, and labor surplus area programs;
    (ii) Implementing policy decisions through the issuance of operating 
procedures (Operating Divisions (OPDIVs) may develop alternative 
procedures for achieving departmental policy goals, and objectives. 
However, any change in procedures must be approved by the Under 
Secretary);
    (iii) Reviewing and evaluating the Department's policies, practices, 
and procedures pertaining to the disadvantaged business, small business, 
and labor surplus area programs, as well as recommending changes or 
corrective actions to the OPDIV heads or to the Under Secretary, as 
appropriate;
    (iv) Providing the Under Secretary with regular appraisals of 
performance and quality of effort, including timely notification of 
significant problems, events, and accomplishments, and the need for 
changes in Department-wide objectives and policies; and
    (v) Providing technical assistance and support to the small and 
disadvantaged business utilization specialists.
    (2) The Director, OSDBU is authorized to:
    (i) Establish standards, procedures and operating guidelines 
controlling the manner in which the small business, disadvantaged 
business, and labor surplus area programs are conducted throughout the 
Department;
    (ii) Provide advice on proposed allocations of personnel, funds, and 
other resources in light of the total needs of the Department;

[[Page 88]]

    (iii) Prescribe, after coordination with appropriate concerned 
personnel, reporting requirements necessary to preserve openness in 
reporting, identifying emerging problems, monitor Department-wide 
activity, and provide a basis for appraisal and evaluation of 
performance. To the maximum extent, these reporting requirements will be 
satisfied through existing Department-wide reporting systems or by 
making modifications to them;
    (iv) Conduct surveys and review of operating practices in the OPDIVs 
and regional offices; and
    (v) Communicate directly with the small and disadvantaged business 
utilization specialists to assist them in carrying out their individual 
and collective responsibilities.



319.201-70  Small and disadvantaged business utilization specialist.

    (a) The Head of each OPDIV shall appoint a qualified full time small 
and disadvantaged business utilization specialist (SADBUS) in the 
following activities: Office of Human Development Services (OHDS), 
Health Care Financing Administration (HCFA), Social Security 
Administration (SSA), Public Health Service (PHS), to include the Food 
and Drug Administration (FDA), Health Resources and Services 
Administration (HRSA) (and each regional Office of Engineering 
Services), Indian Health Service (IHS), National Institutes of Health 
(NIH), Alcohol, Drug Abuse, and Mental Health Administration (ADAMHA), 
Centers for Disease Control (CDC), and Administrative Services Center 
(ASC). A SADBUS shall also be appointed for the Office of the Secretary 
(OS) and for each Regional Office. As deemed necessary, additional small 
and disadvantaged business utilization specialists may be appointed in 
larger contracting activities.
    (b) When the volume of contracting does not warrant assignment of a 
full-time SADBUS, an individual shall be appointed as the specialist on 
a part-time basis. The responsibilities of this assignment shall take 
precedence over other responsibilities. The specialist shall be 
responsible directly to the appointing authority and shall be at an 
organizational level outside the direct acquisition chain of command, 
i.e., should report directly to the principal official responsible for 
acquistion, where appropriate.
    (c) The Director, OSDBU will exercise functional management 
authority over small and disadvantaged business utilization specialist 
regarding small business, disadvantaged business, and labor surplus area 
matters. Appointments of SADBUS's shall only be made after consultation 
with the Director, OSDBU. A copy of each appointment and termination of 
appointment of specialists shall be forwarded to the Director, OSDBU.
    (d) The SADBUS shall perform the following duties, as determined to 
be appropriate to the activity by the appointing official or by the 
Director, OSDBU. The SADBUS shall:
    (1) Maintain a program designed to locate capable small business, 
disadvantaged business, women-owned business and labor surplus area 
business sources for current and future acquisitions, through SBA or by 
using other methods, establish appropriate source lists for each 
category, and work closely with contracting and small purchasing offices 
to ensure offers are solicited from firms on the source lists;
    (2) Coordinate inquiries and requests for advice from small 
business, disadvantaged business, women-owned business, and labor 
surplus area business concerns on acquisition matters, and counsel them 
with respect to business opportunities to enhance their potential 
participation in the Department's acquisition program;
    (3) Prior to the issuance of solicitations (or contract 
modifications for additional supplies or services) in excess of the 
small purchase limitation, which have not been reviewed, reserved, or 
set-aside by the contracting officer, review the contracting officer's 
justification for such action;
    (4) Assure that small business, disadvantaged business, women-owned 
business, and labor surplus area concerns are provided adequate 
specifications or drawings by initiating actions, in writing, with 
appropriate technical and contracting personnel to ensure that all 
necessary specifications or

[[Page 89]]

drawings for current and future acquisitions, as appropriate, are 
available;
    (5) Review proposed requirements for possible breakout of items 
suitable for acquisitions from small business, disadvantaged business, 
women-owned business, and labor surplus area concerns;
    (6) Assure that financial assistance, available under existing 
regulations, is offered, and that requests by small business concerns 
for proper assistance are not treated as a handicap in the award of 
contracts;
    (7) Participate in determinations concerning responsibility of 
prospective contractors whenever small business concerns are involved;
    (8) Participate in the evaluation of a prime contractor's small 
business, labor surplus area, and disadvantaged business subcontracting 
plans;
    (9) Advise and assist contracting officers in discharging their 
responsibilities by:
    (i) Monitoring and reviewing contractor performance to determine 
compliance with small and small disadvantaged business subcontracting 
plans, and
    (ii) Developing and maintaining records and reports that reflect 
such compliance or noncompliance;
    (10) Review and make appropriate recommendations to the contracting 
officer on proposals to furnish Government-owned facilities to 
contractors if this action may enhance the small business program;
    (11) Assure that the participation of small businesses, 
disadvantaged businesses, women-owned business, and labor surplus area 
concerns is accurately reported;
    (12) Make available to SBA copies of solicitations when so 
requested;
    (13) When a bid or offer from a small business, disadvantaged 
business, women-owned business, or labor surplus area concern has been 
rejected for nonresponsiveness or nonresponsibility, upon request, aid, 
counsel and assist that firm in understanding requirements for 
responsiveness and responsibility so that the firm may be able to 
qualify for future awards;
    (14) Participate in government-industry conferences to assist small 
business, disadvantaged business, women-owned business, and labor 
surplus area concerns, including Business Opportunity/ Federal 
Acquisition Conferences, Minority Business Enterprises Acquisition 
Seminars, and Business Opportunity Committee meetings;
    (15) Advise potential sources how they can obtain information about 
sealed bid and negotiated acquisitions;
    (16) Brief the head of the contracting activity at least once 
quarterly concerning the status of the activity's small business, 
disadvantaged business, women-owned business, and labor surplus area 
programs in relation to goals and objectives established;
    (17) Participate in the development, implementation, and review of 
automated source systems to assure that the interests of small business, 
disadvantaged business, women-owned business, and labor surplus area 
concerns are fully considered;
    (18) Assure that the organization maintains a list of products and 
services which are categorized as repetitive small business set-aside;
    (19) Provide small business, disadvantaged business, women-owned 
business, and labor surplus area concerns information regarding 
assistance available from Federal agencies such as the Small Business 
Administration, Minority Business Development Agency, Bureau of Indian 
Affairs, Economic Development Administration, National Science 
Foundation, Department of Labor, and others, including State agencies 
and trade associations;
    (20) Be responsible for establishing an education and training 
program for personnel whose duties and functions affect the activity's 
small business, disadvantaged business, women-owned business, and labor 
surplus areas programs; and
    (21) Participate in interagency programs relating to small business, 
disadvantaged business, women-owned business, and labor surplus area 
matters as authorized by the Director, OSDBU.
[49 FR 14007, Apr. 9, 1984, as amended at 50 FR 23126, 23133, May 31, 
1985; 50 FR 38004, Sept. 19, 1985; 54 FR 24343, June 7, 1989; 57 FR 
11690, Apr. 7, 1992]

[[Page 90]]



319.270  Federal acquisition conference.

    The Department of Commerce is responsible for coordinating the 
participation of Federal civilian agencies in a continuing series of 
conferences which are sponsored by members of Congress. The objectives 
of these conferences are:
    (a) Location of additional acquisition sources to broaden the 
acquisition base of Federal agencies;
    (b) Stimulation of local, regional, and national economic growth, 
national security, and cost reduction;
    (c) Location of underutilized production capacity;
    (d) Prevention or elimination of pockets of underemployment; and
    (e) Assistance of small and small disadvantaged business concerns.

As notified by the OSDBU, contracting activities shall provide 
appropriate SADBUS or acquisition personnel to participate in person-to-
person counseling at these conferences. Ordinarily, participation by 
contracting activities will be restricted to conferences held within the 
geographical areas adjacent to their officers. The brochure, ``How To Do 
Business With DHHS'' should be of great assistance in this counseling as 
it has been specifically prepared to assist individuals, firms, and 
institutions who may wish to do business with this Department. It 
contains a brief description of the mission and programs of HHS and its 
Operating Divisions and provides a listing of contracting offices and 
the types of services and commodities acquired by each.



              Subpart 319.5--Set-Asides for Small Business



319.501  General.

    (c) Prior to the contracting officer's review, the SADBUS shall 
review each proposed acquisition to determine the feasibility of 
recommending award to the Small Business Administration (SBA) pursuant 
to section 8(a) of the Small Business Act. When it cannot be awarded to 
SBA pursuant to section 8(a), the SADBUS shall review the proposed 
acquisition to determine if it can be recommended as a set-aside under 
one of the set-aside priorities stated in FAR 19.504. The SADBUS's 
recommendation shall be entered on Form HHS-653, Small Business-Labor 
Surplus Set-Aside Review Form, with the reasons for the type of set-
aside recommended, or the reasons for not recommending a set-aside, and 
provided to the contracting officer. Upon receipt of the Form HHS-653, 
the contracting officer shall promptly concur or nonconcur with the 
SADBUS's recommendation. The contracting officer will make the final 
determination as to whether the proposed acquisition will be set-aside 
or not. If the contracting officer approves the SADBUS's set-aside 
recommendation, the proposed acquisition will be set-aside as specified. 
However, if the contracting officer disapproves the SADBUS's set-aside 
recommendation, the reasons must be documented on the Form HHS-653, and 
the form signed. (See 319.505 for options available to the SADBUS 
regarding the contracting officer's disapproval of a set-aside 
recommendation.) In all cases, the completed Form HHS-653 is to be 
retained by the contracting officer and placed in the contract file.
[57 FR 11690, Apr. 7, 1992]



319.503  Setting aside a class of acquisitions.



319.503-70  Small business class set-aside for construction, repair, and alteration work.

    A small business class set-aside is considered to have been made for 
each proposed acquisition for construction, repair, and alteration work 
in an estimated amount ranging from $2,500 to $2 million. Accordingly, 
the contracting officer shall set aside for small business each proposed 
acquisition. If, in his/her judgment, the particular acquisition falling 
within the dollar limits specified above is unsuitable for a set-aside 
for exclusive small business participation, the procedure set forth in 
FAR 19.506 shall apply. Proposed acquisitions for construction, repair, 
and alteration work in an estimated amount of more than $2 million shall 
be processed on a case by case basis.



319.505  Rejecting set-aside recommendations.

    (a) If the contracting officer rejects the SADBUS's recommendation 
for a

[[Page 91]]

set-aside and an SBA procurement center representative (PCR) is not 
assigned or available, the SADBUS may appeal, in writing, to the head of 
the contracting activity (HCA) or his/her designee. The SADBUS shall 
provide the HCA or designee all the pertinent information concerning the 
set-aside disagreement, and the HCA shall respond in writing within 
seven business days. The HCA's decision is final and not appealable. The 
decision by the HCA shall be attached to the Form HHS-653 and placed in 
the contract file. After receipt of a final decision by the HCA, and if 
the decision approves the action of the contracting officer, the SADBUS 
shall forward, for information and management purposes, complete 
documentation of the case to the OSDBU Director. Documentation 
transmitted shall include, as a minimum, a copy of the appeal memorandum 
submitted to the HCA, a copy of the IFB or RFP, a list of proposed 
sources, a copy of the Form HHS-653 and attachments completed by the 
SADBUS and the contracting officer, a copy of the HCA's decision, and 
all other written material considered by the HCA in arriving at the 
decision. The SADBUS' transmittal memorandum shall contain an 
affirmative statement that the attachments constitute the complete file 
reviewed and considered by the HCA in making the final decision.

    If an SBA PCR is assigned or available and the SADBUS refers the 
case to that person, the SBA PCR may either concur with the decision of 
the contracting officer not to set-aside the proposed acquisition or 
recommend to the contracting officer that it be set-aside. For the SBA 
PCR to make a comprehensive review, at least the following should be 
provided as attachments to the Form HHS-653: the statement of work, 
evaluation criteria, Government cost estimate, source list including 
size of firms, and a copy of any justification for other than small 
business considerations that may be applicable. Once the case has been 
referred to the SBA PCR, no further appeal action shall be taken by the 
SADBUS. (Refer to FAR 19.505 for the procedures available to the SBA PCR 
if the contracting officer rejects the set-aside recommendation.)
[49 FR 14007, Apr. 9, 1984, as amended at 57 FR 11690, Apr. 7, 1992]



319.506  Withdrawing or modifying set-asides.

    (b) If an SBA PCR is not assigned, the disagreement between the 
contracting officer and the SADBUS shall be referred to the HCA for 
resolution.
    (d) Immediately upon notice from the contracting officer, the SADBUS 
shall provide telephone notification regarding all set-aside withdrawals 
to the OSDBU Director.



319.570  Contract payments.

    Contract payments to small business concerns must be made on a 
timely basis. Payment of an invoice or voucher must be made within 30 
days after receipt of the invoice or voucher or from acceptance of the 
goods or services. Each invoice or voucher from a small business concern 
not sent directly to the servicing finance office, but received by the 
contracting activity, shall be stamped or otherwise identified for 
expedited payment before it is forwarded to the servicing finance 
office.



      Subpart 319.7--Subcontracting With Small Business and Small 
                     Disadvantaged Business Concerns



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



319.705-2  Determining the need for a subcontracting plan.

    The dollar value of all proposed incremental funding actions shall 
be included in determining whether the acquisition meets the dollar 
threshold requiring a subcontracting plan. The subcontracting plan shall 
be based on the total value of the acquisition which will include the 
value of all option quantities or funding actions.



319.705-3  Preparing the solicitation.

    The SBA PCR should be allowed a period of one to five business days 
for the review of the solicitation, depending

[[Page 92]]

upon the circumstances and complexity of the individual acquisition.
[49 FR 14007, Apr. 9, 1984, as amended at 57 FR 11690, Apr. 7, 1992]



319.705-4  Reviewing the subcontracting plan.

    The offeror's/bidder's subcontracting plan for small business 
concerns shall be judged independently of the subcontracting plan for 
small disadvantaged business concerns. If a subcontracting plan is not 
obtained, the contracting officer must document the contract file to 
substantiate the reasons why the plan was not obtained. The contracting 
officer must obtain a satisfactory subcontracting plan prior to awarding 
the contract.
    (d) If the contracting officer determines that the subcontracting 
plan submitted reflects the best effort by the offeror/bidder to award 
subcontracts to small and small disadvantaged business concerns, but the 
SADBUS disagrees with the contracting officer's determination, a final 
determination shall be made by the principal official responsible for 
acquisition. The SADBUS shall submit this final determination to the 
Director, OSDBU with the appropriate supporting documentation.
    (1) The contracting officer may accept the terms of an overall or 
``master'' company subcontracting plan if it is incorporated by 
reference into a specific subcontracting plan submitted by the apparent 
successful offeror/bidder for a specific contract, if:
    (i) The master plan contains all the elements required by the 
statute;
    (ii) Subcontracting goals for small and small disadvantaged business 
concerns are specifically set forth in each contract or modification 
over the statutory thresholds;
    (iii) Any changes to the plan deemed necessary and required by the 
contracting officer in areas other than goals are specifically set forth 
in the contract or modification;
    (iv) The contracting officer has copies of the entire plan; and
    (v) The SBA PCR has had an opportunity to comment on the master 
plan.
    (2) If the prime contract is for a commercial product, the required 
subcontracting plan may relate to the company's production of the item 
generally (both for the Government contract and for regular commercial 
sale) rather than solely to the item being acquired under the Government 
contract. In such cases, the contractor shall be required to submit one 
company-wide, annual plan to be reviewed for approval by the first 
agency with which it enters into a prime contract (which requires a 
subcontracting plan) during the fiscal year. The approved plan will 
remain in effect for the entire fiscal year and is applicable to all 
deliveries made under contracts entered into during the contractor's 
fiscal year, even though these deliveries are made in a succeeding 
fiscal year. The contractor shall submit a new plan to the first agency 
with which it enters into a contract (over the statutory threshold) 
during a succeeding fiscal year. The new plan shall apply to all 
deliveries made under contracts entered into during the succeeding 
fiscal year, no matter when the deliveries are made.
[49 FR 14007, Apr. 9, 1984, as amended at 57 FR 11690, Apr. 7, 1992]



319.705-5  Awards involving subcontracting plans.

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



319.705-6  Postaward responsibilities of the contracting officer.

    The SADBUS shall perform the distribution requirements stated in 
paragraphs (a) through (c) of FAR 19.705-6. A copy of any company-wide 
plans and associated approvals shall also be sent to the Director, OSDBU 
by the SADBUS. In addition, the SADBUS is responsible for summarizing 
and reporting to the Director, OSDBU, on a quarterly basis, all prime 
contracts $500,000 and over ($1 million for construction) using the 
following reporting format:
    (a) Name of the OPDIV and program office;
    (b) Number and dollar amount of contracts requiring subcontracting 
plans;
    (c) Number of contracts with subcontracting plans;

[[Page 93]]

    (d) Number of contracts without subcontracting plans;
    (e) Small and small disadvantaged business subcontracting goals; and
    (f) Statements citing reasons why small and small disadvantaged 
business subcontracting plans were not included in the contracts.



 319.706  Responsibilities of the cognizant administrative contracting officer.

    (a) The contracting officer shall comply with the requirements of 
FAR 19.706(a), and shall use the Standard Form 294, Subcontracting 
Report for Individual Contracts, to monitor the contractor's progress in 
achieving both the small business and small disadvantaged business 
subcontracting goals. The contracting officer shall require the 
contractor to provide in the Remarks block of each Standard Form 294 
submitted a narrative of the progress in fulfilling the small business 
and small disadvantaged business subcontracting goals. The contracting 
officer shall require the contractor to report any difficulties in 
achieving the goals and the actions being taken by the contractor to 
overcome the difficulties. The contracting officer shall document the 
contract file whenever the contractor is experiencing difficulties in 
achieving the planned subcontracting goals, and shall indicate the 
actions taken by the contractor to resolve the difficulties and the 
actions taken by the contracting officer to remedy the situation. A copy 
of this documentation shall be provided to the SADBUS.
    (b) At the time of physical completion of the contract, the 
contracting officer shall prepare a memorandum for record for inclusion 
in the contract file indicating whether or not the contractor complied 
with the subcontracting plan and subcontracting provisions of the 
contract.
    (1) If the contractor achieved its subcontracting dollar goals for 
both small business and small disadvantaged business, the memorandum 
shall state that the contractor complied with the subcontracting plan 
and provisions of the contract. No other documentation is needed.
    (2) If the contractor failed to achieve its subcontracting dollar 
goals for either small business or small disadvantaged business, or 
both, the contracting officer shall indicate this failure in the 
memorandum and determine whether the contractor did or did not exercise 
its best efforts in attempting to achieve the goals.
    (i) If determined that the contractor exercised its best efforts, 
the contractor shall be found to have complied with the subcontracting 
plan and provisions of the contract. The rationale for this 
determination shall be documented in the memorandum.
    (ii) If determined that the contractor did not exercise its best 
efforts, the contractor shall be found to have not complied with the 
subcontracting plan and provisions of the contract. The reasons for this 
determination shall be documented in the memorandum, along with a 
description of specific actions taken by the contracting officer during 
the performance of the contracting to attempt to remedy the failure.
    (c) A copy of the memorandum pertaining to either situation 
described in paragraph (b)(2) (i) or (ii) of this section shall be sent 
to the Director, Office of Small and Disadvantaged Business Utilization.
[50 FR 46299, Nov. 7, 1985]



 Subpart 319.8--Contracting with the Small Business Administration (the 
                              8(a) Program)

    Source:  55 FR 13536, Apr. 11, 1990, unless otherwise noted.



319.800  General.

    (c) The signing of the contract document may be accepted as the 
Small Business Administration's (SBA) certification that SBA is 
competent to perform a specific HHS requirement.



319.803  Selecting acquisitions for the 8(a) Program.

    (c) Brochures of 8(a) concerns which have been interviewed by the 
Office of Small and Disadvantaged Business Utilization (OSDBU) are 
forwarded to each

[[Page 94]]

small and disadvantaged business utilization specialist (SADBUS). These 
brochures are to be reviewed by the SADBUS to match HHS requirements 
with the capabilities of these concerns. The SADBUS will make the 
capabilities of these concerns known to program personnel and will 
obtain information, as needed, by contacting OSDBU or SBA.



319.812  Contract administration.

    (b) The responsibility for subcontract administration and field 
inspection will, in most cases, be delegated by SBA to the contracting 
activity. The contracting activity may develop a tripartite agreement 
for execution by SBA, the 8(a) subcontractor, and the contracting 
activity instead of developing separate modifications for the SBA 
contract and the 8(a) subcontract.
    (c) Some 8(a) concerns may need additional management expertise for 
optimal performance and completion of a particular contract. Therefore, 
when subcontract administration is delegated to HHS by SBA, the 
contracting activity shall promptly apprise the SBA, the SADBUS, and 
OSDBU whenever the contractor is experiencing problems. SBA should 
provide necessary technical assistance so the contractor can 
successfully complete the contract.
    (d) The OSDBU, SADBUS, and SBA are to be notified prior to 
initiating final action to terminate an 8(a) contract.



319.870  Liaison with the Small Business Administration.

    (a) Contracting activities will maintain a continuous liaison with 
the SBA to ensure that the overall goals of each activity are achieved. 
In the event there is a dispute between the contracting activity and a 
SBA representative regarding any aspect of 8(a) contracting, the 
contracting activity must promptly notify OSDBU.
    (b) The business development responsibility of SBA requires them to 
assist in and monitor the growth and development of all 8(a) concerns. 
Therefore, it is incumbent upon HHS to assist SBA in this effort by 
utilizing the source selection process in a manner that would make use 
of the largest possible number of 8(a) concerns.



PART 320--LABOR SURPLUS AREA CONCERNS--Table of Contents




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



                         Subpart 320.1--General



320.102  General policy.

    Contracting activities should obtain appropriate publications and 
other information identifying labor surplus areas from:

    U.S. Department of Labor, Employment and Training Administration, 
Office of Policy Evaluation and Research, Division of Labor Market 
Information, Washington, D.C. 20530.


Contracting officers shall use the ``Directory of Labor Surplus Area 
Contractors,'' provided by the Office of Small and Disadvantaged 
Business Utilization, as a source to identify labor surplus area 
concerns and to augment other labor surplus area source lists. 
Contracting officers should also seek to identify concerns from labor 
surplus areas by placing sources sought synopses in the Commerce 
Business Daily. Small and disadvantaged business utilization specialists 
shall assist contracting officers in developing and maintaining source 
lists of small business and other concerns in labor surplus areas. 
Department of Commerce and SBA regional and field offices should be 
contacted for assistance in identifying labor surplus area concerns.
[49 FR 14012, Apr. 9, 1984]



PART 322--APPLICATION OF LABOR LAWS TO GOVERNMENT ACQUISITIONS--Table of Contents




            Subpart 322.6--Walsh-Healey Public Contracts Act

Sec.
322.604  Exemptions.
322.604-2  Regulatory exemptions.

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

[[Page 95]]



            Subpart 322.6--Walsh-Healey Public Contracts Act



322.604  Exemptions.



322.604-2  Regulatory exemptions.

    (c)(1) The actions required by FAR 22.604-2(c)(1) shall be exercised 
by the Director, Office of Acquisition and Grants Management (DOAGM). 
Contracting offices requiring exemptions shall forward requests through 
normal acquisition channels to the DOAGM.
[51 FR 44294, Dec. 9, 1986; 51 FR 47353, Dec. 31, 1986, as amended at 54 
FR 24343, June 7, 1989]



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




             Subpart 324.1--Protection of Individual Privacy

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

                Subpart 324.2--Freedom of Information Act

324.202  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:  49 FR 14013, Apr. 9, 1984, unless otherwise noted.



             Subpart 324.1--Protection of Individual Privacy



324.100  Scope of subpart.

    This subpart implements 45 CFR part 5b, Privacy Act Regulations, and 
FAR subpart 24.1, Protection of Individual Privacy, which implement the 
Privacy Act of 1974 (Pub. L. 93-579, December 31, 1974; 5 U.S.C. 552a) 
and OMB Circular No. A-108, July 9, 1975.



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. If 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

[[Page 96]]

which results in the Privacy Act requirements becoming applicable to a 
contract.
    (b)(1) The contracting officer shall identify the system(s) of 
records on individuals in solicitations, contracts, and contract 
modifications to which the Privacy Act and the implementing regulations 
are applicable.
    (2) The contracting officer shall include a statement in the 
contract notifying the contractor that the contractor and its employees 
are subject to criminal penalties for violations of the Act (5 U.S.C. 
552a(i)) to the same extent as employees of the Department. The 
statement shall require that the contractor assure that each contractor 
employee knows the prescribed rules of conduct, and each contractor 
employee is aware that he/she can be subjected to criminal penalties for 
violations of the Act. The contracting officer shall provide the 
contractor with a copy of the rules of conduct and other requirements 
set forth in 45 CFR 5b.
    (c) The contracting officer shall include in the contract the 
disposition to be made of the system(s) of records on individuals upon 
completion of performance of the contract. For example, the contract may 
require the contractor to completely destroy the records, to remove 
personal identifiers, to turn the records over to the Department, or to 
keep the records but take certain measures 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.



                Subpart 324.2--Freedom of Information Act



324.202  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 FOIA request, shall 
follow Department and operating division procedures. As necessary, 
actions should be coordinated with the cognizant Freedom of Information 
(FOI) Officer and the Business and Administrative 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 sections 5.65 and 5.66; also of interest are sections 5.32, 
5.33, and 5.35.
[54 FR 24343, June 7, 1989]



             Subpart 324.70--Confidentiality of Information



324.7001  General.

    In the 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.

[[Page 97]]



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



324.7003  Applicability.

    (a) The ``Confidentiality of Information'' clause, set forth in 
352.24-70, 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 invlove 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 
unvalidated 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 herein, 
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 REP 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 such data.



PART 325--FOREIGN ACQUISITION--Table of Contents




                Subpart 325.1--Buy American Act--Supplies

Sec.
325.102  Policy.
325.108  Excepted articles, materials, and supplies.
325.108-70  Formats for nonavailability determinations.

               Subpart 325.3--Balance of Payments Program

325.302  Policy.

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

    Source:  49 FR 14015, Apr. 9, 1984, unless otherwise noted.



                Subpart 325.1--Buy American Act--Supplies



325.102  Policy.

    (b) The head of the contracting activity shall make the 
determinations required by FAR 25.102(a) (1) through (5) and FAR 
25.102(b).
[51 FR 44294, Dec. 9, 1986; 51 FR 47353, Dec. 31, 1986]



325.108  Excepted articles, material, and supplies.

    (b) Articles, materials, and supplies not listed in FAR 25.108(d) 
may be excepted only after a written determination has been made by the 
head of the contracting activity. These determinations are required only 
in instances

[[Page 98]]

where it has been determined that only suppliers of foreign source end 
items shall be solicited. However, approvals and determinations covering 
individual acquisitions in the following categories may be made by the 
contracting officer:
    (1) Acquisition of spare and replacement parts for foreign 
manufactured items, if the acquisition must be restricted to the 
original manufacturer or its supplier; and
    (2) Acquisition of foreign drugs when it has been determined, in 
writing, by the responsible program official, that only the requested 
foreign drug will fulfill the requirement.

Formats for the above referenced written determinations are shown in 
325.108-70.



325.108-70  Formats for nonavailability determinations.

    (a) The following is the format for a nonavailability determination 
made by a contracting officer:

                    Determination of Nonavailability

    Pursuant to the authority contained in section 2, Title III, of the 
Act of March 3, 1933, popularly called the Buy American Act (41 U.S.C. 
10(a-d)), and authority delegated to me by 325.108(b), I hereby find 
that:
    (a) (Insert a description of the item or items to be acquired, 
including unit, quantity, and estimated cost inclusive of duty and 
transportation costs to destination.)
    (b) (Enter the name and address of the proposed contractor or 
supplier, and country of origin of the item or items.)
    (c) (Include a statement of the necessity for the acquisition.)
    (d) (Include a statement of facts establishing the nonavailability 
of a similar item or items of domestic origin. If there is no known 
domestic item or items which can be used as a reasonable substitute, a 
statement to this effect will be made.)
    Based upon these findings, it is determined that the above-described 
item(s) is (are) not mined, produced, or manufactured, or the articles, 
materials, or supplies from which it (they) is (are) manufactured, are 
not mined, produced, or manufactured, as the case may be, in the United 
States in sufficient and reasonably available commercial quantities and 
of a satisfactory quality.
    Accordingly, the requirement of the Buy American Act that 
acquisition be made from domestic sources and that it be of domestic 
origin is not applicable to this acquisition, since the referenced 
acquisition is within the nonavailability exception stated in the Buy 
American Act. Authority is granted to acquire the above-described 
item(s) of foreign origin (country of origin) at an estimated total cost 
of $------, including duty and transportation cost to destination.
 (Date)_________________________________________________________________
 _______________________________________________________________________
        (Contracting Officer)

    (b) The following is the format for a nonavailability determination 
made by the head of the contracting activity. Part 1 of the 
determination shall be signed by the preparing authority (contracting 
officer of official with contracting authority), and Part 2 shall be 
signed by the approving authority.

                    Determination of Nonavailability

                                 Part 1

 Date___________________________________________________________________
    Pursuant to the authority contained in Section 2, Title III, of the 
Act of March 3, 1933, popularly called the Buy American Act (41 U.S.C. 
10(a-d)), I hereby find:
    (a) (Insert a description of the item or items to be acquired, 
including unit, quantity, and estimated cost inclusive of duty and 
transportation costs to destination.)
    (b) (Insert a brief statement of the necessity for the acquisition.)
    (c) (Include a statement of facts establishing the nonavailability 
of a similar item or items of domestic origin.)
    Based upon the above showing of fact, it is determined that the 
above described item(s) is (are) not mined, produced, or manufactured, 
or the articles, materials, or supplies from which it (they) is (are) 
manufactured, are not mined, produced or manufactured, as the case may 
be, in the United States in sufficient and reasonably available 
commercial quantities and of a satisfactory quality.
 (Signature)____________________________________________________________

                                 Part 2

    The requirement of the Buy American Act that acquisition be made 
from domestic sources and that it be of domestic origin is not 
applicable to the above described acquisition, since the referenced 
acquisition is within the nonavailability exception stated in the Act. 
The feasibility of foregoing the requirement or providing a United 
States substitute has been considered. Authority is granted to acquire 
the above described item(s) of foreign origin (country of origin) at an 
estimated total cost of $------, including duty and transportation costs 
to destination.
 (Signature)____________________________________________________________

[[Page 99]]



               Subpart 325.3--Balance of Payments Program



325.302  Policy.

    All determinations addressed in FAR 25.302 shall be made by the 
principal official responsible for acquisition (not delegable).

[[Page 100]]



             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  Contract clause.

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

    Source:  56 FR 58316, Nov. 19, 1991, unless otherwise noted.



                        Subpart 328.3--Insurance



328.301  Policy.

    (a) It is the policy of this Department 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.
    (b) In addition to the limitations in paragraph (a) of this section, 
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  Contract clause.

    (a) 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.



PART 330--COST ACCOUNTING STANDARDS--Table of Contents




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



                 Subpart 330.2--CAS Program Requirements



330.201-5  Waiver.

    (c) The requirements of FAR 30.201-5 shall be exercised by the 
Director, Office of Acquisition and Grants Management (DOAGM). Requests 
for waivers shall be forwarded through normal acquisition channels to 
the DOAGM.
[54 FR 24344, June 7, 1989]



PART 332--CONTRACT FINANCING--Table of Contents




                     Subpart 332.4--Advance Payments

Sec.
332.402  General.
332.403  Applicability.
332.406  Letters of credit.
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  Limitation of cost or funds.
332.705  Contract clauses.
332.705-2  Clauses for limitation of costs or funds.

                      Subpart 332.9--Prompt Payment

Sec.
332.902  Definitions.
332.905  Invoice payments.

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

    Source:  49 FR 14018, Apr. 9, 1984, unless otherwise noted.



                     Subpart 332.4--Advance Payments



332.402  General.

    (e) The determination that the making of an advance payment is in 
the public interest (See FAR 32.402(c)(1)(iii)(A)) shall be made by the

[[Page 101]]

respective principal official responsible for acquisition (PORA).
[52 FR 27560, July 22, 1987, as amended at 55 FR 42197, Oct. 18, 1990]



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.



332.406  Letters of credit.

    (c)(1) A blanket determination and findings authorizing interest 
free advance payments under a single letter of credit has been executed 
and remains in effect for each of the nonprofit organizations listed in 
Attachment I ``Single Letter of Credit Recipients and Central Point 
Addressees.'' These determinations and findings are applicable to all 
existing and future contracts entered into by the Department, its 
operating divisions, OS staff offices, and regional offices. All 
contracts with the listed organizations which require advance payments 
(whether under section 305 of the Federal Property and Administrative 
Services Act of 1949, as amended, or other statutory authority) shall 
provide for payment to be made under the appropriate letter of credit. 
The clause set forth in 352.232-73 shall be included in all such 
contracts and the cognizant fiscal office shall be apprised of its 
inclusion.
    (2) In those instances where it is practical and feasible to finance 
an advance payment under a letter of credit other than one which is 
incorporated under a single letter of credit described in paragraph 
(c)(1) above, a determination and findings shall be executed by the PORA 
if the cited authority is to be section 305 of the Federal Property and 
Administrative Services Act. In cases where an authority other than 
section 305 is to be used, a determination and findings shall be 
submitted to the appropriate official authorized by the cited statute to 
approve the advance payment.
    (3) The Treasury Department's letter of credit method of financing 
advance payments shall be employed, whenever feasible. Department-wide 
blanket letters of credit, which apply to the financing of research 
contracts and grants between the institution and all activities of the 
Department, shall be utilized to the maximum extent practicable. Where a 
particular educational institution is supported by research contracts 
and grants with only one operating division of the Department, a single 
letter of credit, applicable to all research contracts and grants 
between the institution and that operating division may be employed.
[49 FR 14018, Apr. 9, 1984, as amended at 50 FR 23133, May 31, 1985; 50 
FR 38004, Sept. 19, 1985; 51 FR 44294, Dec. 9, 1986; 55 FR 42197, Oct. 
18, 1990]



332.407  Interest.

    (d) The PORA is authorized to make the determinations in FAR 
32.407(d) and as follows. In addition to the interest-free advance 
payments for the types of contracts listed in FAR 32.407(d), advance 
payments without interest may be approved for nonprofit contracts which 
are without fee with educational institutions and other nonprofit 
organizations, whether public or private, which are for the performance 
of work involving health services, educational programs, or social 
service programs, including, but not limited to, 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 deaf;
    (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

[[Page 102]]

    (11) Surveys or demonstrations in the field of social service.
[49 FR 14018, Apr. 9, 1984, as amended at 51 FR 44294, Dec. 9, 1986; 52 
FR 27560, July 22, 1987; 55 FR 42197, Oct. 18, 1990]



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 PORA in the form of a briefing memorandum.
[49 FR 14018, Apr. 9, 1984, as amended at 51 FR 44294, Dec. 9, 1986; 52 
FR 27560, July 22, 1987; 55 FR 42197, Oct. 18, 1990]



             Subpart 332.5--Progress Payments Based on Costs



332.501  General.

[51 FR 44294, Dec. 9, 1986]



332.501-2  Unusual progress payments.

    (a)(3) The approval of an unusual progress payment shall be made by 
the appropriate principal official responsible for acquisition (PORA).
[51 FR 44294, Dec. 9, 1986, as amended at 52 FR 27560, July 22, 1987; 55 
FR 42197, Oct. 18, 1990]



                     Subpart 332.7--Contract Funding



332.702  Policy.

    An incrementally funded contract is a contract in which the total 
work effort is to be performed over multiple time periods and funds are 
allotted to cover discernible phases or increments of performance.
    (a) Incremental funding may be applied to cost-reimbursement type 
contracts for the acquisition of research and development and other 
types of nonpersonal, nonseverable services. It shall not be applied to 
contracts for construction services, architect-engineer services, or 
severable services. Incremental funding allows nonseverable cost-
reimbursement contracts, awarded for more than one year, to be funded 
from succeeding fiscal years.
    (b) It is departmental policy that contracts for projects of 
multiple year duration be fully funded, whenever possible, to cover the 
entire project. 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 of the fiscal year in which 
the contract is awarded and of the succeeding fiscal years of the 
project's duration, during which additional funds may be obligated by 
increasing the allotment to the contract;
    (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
    (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.
[49 FR 14018, Apr. 9, 1984, as amended at 57 FR 35473, Aug. 10, 1992]



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 will be expected to respond to RFPs with technical and 
cost proposals for the entire project indicating distinct break-outs of 
the planned phases or increments.
    (4) Negotiations will be conducted based upon the total project, 
including

[[Page 103]]

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 contract period shall be reduced 
accordingly.
    (6) Because of the magnitude of the scope of work and multiple year 
period of performance under an incrementally funded contract, there is a 
critical need for careful program planning. Program planning must 
provide for appropriate surveillance of the contractor's performance and 
adequate controls to ensure that projected funding will not impinge on 
the program office's ability to support, within anticipated 
appropriations, other equally important contract or grant programs.
    (7) An incrementally funded contract must contain precise 
requirements for progress reports to enable the project officer to 
effectively monitor the contract. The project officer should be required 
to prepare periodic performance evaluation reports to facilitate the 
program office's ultimate decision to allot additional funds under the 
contract.



332.704  Limitation of cost or funds.

    For detailed instruction regarding administrative actions in 
connection with anticipated cost overruns, see subpart 342.71.



332.705  Contract clauses.



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



332.902  Definitions.

    Fiscal office means the office responsible for: (a) Determining 
whether interest penalties are due a contractor and, if so, the amount, 
(b) determining whether an invoice offers a financially advantageous 
discount, (c) maintaining records for and submission of prompt payment 
reports to the Deputy Assistant Secretary, Finance (DASF), ASMB, OS, and 
(d) processing payments to the Treasury Department to allow for payment 
to a contractor when due. The fiscal office shall fulfill the roles of 
the ``designated billing office'' and the ``designated payment office.''
[53 FR 43208, Oct. 26, 1988]



332.905  Invoice payments.

    (a)(1)(ii), (b)(4), (c)(5). In most instances, the contracting 
officer will use the seven (7) day constructive acceptance period 
(specified in paragraph (a)(6)(i) of the Prompt Payment clause at FAR 
52.232-25, paragraph (a)(5)(i) of the Prompt Payment clause at FAR 
52.232-26, and paragraph (a)(4)(i) of the Prompt Payment clause at FAR 
52.232.-27) for solicitations and resultant contracts as the basis for 
the fiscal office's computation of interest penalties. However, where 
the contracting officer extends the constructive acceptance period, 
under the conditions described in FAR 32.905, the extension shall be 
coordinated with the fiscal office. A constructive acceptance period of 
less than seven (7) days is not authorized.

[[Page 104]]

    (j) When the contracting officer mistakenly receives an invoice 
first, or is specified in the contract as the first recipient of the 
invoice, and the contract requires payment with thirty (30) days from 
receipt of a ``proper invoice'' (as defined by FAR 32.902), the 
contracting officer shall review the invoice to determine whether or not 
it is proper; and, if so, shall approve the invoice and submit it to the 
fiscal office within sixteen (16) days from the date of receipt. When 
the contracting officer is the first recipient of the invoice and the 
contract establishes a payment due date of more than thirty (30) days 
after receipt, the contracting officer shall review, approve, and submit 
the ``proper invoice'' to the fiscal office at least fourteen (14) days 
prior to the payment due date (unless the contracting officer and fiscal 
office agree, prior to contract award, to a longer period).
[54 FR 43966, Oct. 30, 1989]



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




                         Subpart 333.1--Protests

Sec.
333.101  Definitions.
333.102  General.
333.103  Protests to the agency.
333.104  Protests to GAO.
333.105  Protests to GSBCA.
333.106  Solicitation provision and contract clause.

                   Subpart 333.2--Disputes and Appeals

333.203  Applicability.
333.209  Suspected fraudulent claims.
333.210  Contracting officer's authority.
333.211  Contracting officer's decision.
333.212  Contracting officer's duties upon appeal.
333.212-70  Formats.
333.213  Obligation to continue performance.
333.214  Contract clause.

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



                         Subpart 333.1--Protests

    Source:  50 FR 23133, May 31, 1985, unless otherwise noted.



333.101  Definitions.

    Filed, as used in this subpart, means receipt in the contracting 
office, the immediate Office of the Secretary, the General Accounting 
Office (GAO), or the General Services Board of Contract Appeals (GSBCA), 
as the case may be.



333.102  General.

    (a) Contracting officers shall consider all protests or objections 
regarding the award of a contract, whether submitted before or after 
award, provided the protests are filed in a timely manner and are 
submitted by interested parties. To be considered timely, protests based 
on alleged improprieties in any type of solicitation which are apparent 
before bid opening or the closing date for receipt of proposals shall be 
filed prior to bid opening or the closing date for receipt of proposals. 
In the case of negotiated acquisitions, alleged improprieties which do 
not exist in initial solicitations, but which are subsequently 
incorporated by amendment, must be protested not later than the next 
closing date for receipt of proposals following the incorporation. In 
other cases, protests shall be filed not later than ten (10) Federal 
Government working days after the basis for protest is known or should 
have been known, whichever is earlier. Provided a timely protest has 
been filed initially with the contracting officer, any subsequent 
protest to the Secretary or GAO filed within ten (10) Federal Government 
working days of notification of adverse action will be considered. 
Written confirmation of all oral protests shall be requested from 
protestants and must be timely filed.
    (d)(1) Office of Acquisition and Grants Management (OAGM) has been 
designated as the headquarters office to serve as the liaison for 
protests lodged with GAO. Within OAGM, the Departmental Protest Control 
Officer (DPCO) has been designated as the individual to be contacted by 
GAO.
    (2) The Office of General Counsel--Business and Administrative Law 
Division (OGC-BAL) has been designated to serve as the liaison for 
protests lodged with the GSBCA.
    (3) 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

[[Page 105]]

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, OAGM.
[50 FR 23133, May 31, 1985, as amended at 54 FR 24344, June 7, 1989; 56 
FR 47003, Sept. 17, 1991]



333.103  Protests to the agency.

    (a)(2) The contracting officer is authorized to make the 
determination, using the criteria in FAR 33.103(a), to award a contract 
notwithstanding the protest after obtaining the concurrence of the 
contracting activity's protest control officer and 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, OAGM before making the award.
    (3) 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, by the most expeditious means, 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, submissions of protests to the DPCO may be dispensed with by 
the contracting officer if he/she is reasonably satisfied that the 
protest is groundless. In this instance, the contracting officer, with 
the concurrence of the contracting activity's protest control officer 
and OGC-BAL, may disallow the protest.
    (4) Protests received after award shall be treated as indicated in 
333.103(a)(3), above; however, if the files are to be submitted to the 
DPCO for action, they shall be marked ``IMMEDIATE ACTION--PROTEST AFTER 
AWARD''.
[50 FR 23133, May 31, 1985, as amended at 54 FR 24344, June 7, 1989; 56 
FR 47003, Sept. 17, 1991; 57 FR 35473, Aug. 10, 1992]



333.104  Protests to GAO.

    (a) General. (1) A protestor shall be required to furnish a copy of 
its complete protest to the contracting officer no later than the first 
working day after the protest is filed with GAO. Immediately upon 
receiving a copy of the complete protest, the contracting officer shall 
telephonically notify the contractng activity's protest control officer, 
who, in turn, shall immediately notify the DPCO. The contracting officer 
shall provide the name of the protestor, the solicitation number, the 
date and time the protest was received from the protestor, and any other 
significant information.
    (3) Protests lodged with GAO, whether before or after award, shall 
be processed by the DPCO. 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-BAL. Files shall include the following documentation:
    (i) 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.
    (ii) A copy of the IFB or RFP.
    (iii) A copy of the abstract of bids or proposals.
    (iv) A copy of the bid or proposal of the successful offeror to whom 
award has been made or is proposed to be made.

[[Page 106]]

    (v) A copy of the bid or proposal of the protestant, if any.
    (vi) The current status of award. When award has been made, this 
shall include whether performance has commenced, shipment or delivery 
has been made, or a stop work order has been issued.
    (vii) A copy of any mutual agreement to suspend work on a no-cost 
basis, when appropriate (see FAR 33.104(c)(4)).
    (viii) Copies of the notice of protest given offerors and other 
parties when the notice is appropriate (see FAR 33.104(a)(4)).
    (ix) A copy of the technical evaluation report required by 315.608-
76, when applicable, and a copy of each evaluator's rating for all 
proposals.
    (x) A copy of the negotiation memorandum, when applicable (see 
315.672).
    (xi) The name and telephone number of the person in the contracting 
office who may be contacted for information relevant to the protest, and
    (xii) Any document which is referred to in the contracting officer's 
statement of facts.
    The files shall be assembled in an orderly manner and shall include 
an index of enclosures.
    (4) The contracting officer is responsible for making the necessary 
notifications referenced in FAR 33.104(a)(4). Copies of the views of 
interested parties submitted in response to the notifications shall be 
immediately provided to the DPCO upon receipt by the contracting 
officer.
    (5) The contracting officer shall furnish the protest file 
containing the documentation specified in 333.104(a)(3), except item 
(i), to the DPCO within twelve (12) work days from receipt of the 
protest. The contracting officer shall provide the documentation 
required by item (i) of 333.104(a)(3) to the DPCO within nineteen (19) 
work days from receipt of the protest. (The contracting activity's 
protest control officer may provide a written opinion and recommendation 
on the protest to the DPCO within nineteen (19) work days from receipt 
of the protest by the contracting officer.) The contracting officer 
shall clearly identify any documents or portions of documents he or she 
desires to withhold from the protester, and shall include justification 
for the withholding of each document or portion of a document in the 
contracting officer's statement of facts. 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 prepare the report and submit it and the protest file 
to GAO in accordance with FAR 33.104(a)(5).
    (6)(i) The DPCO shall take the necessary actions specified in FAR 
33.104(a)(6)(i) after receiving all the documentation required by 
333.104(a)(3) from the contracting officer.
    (ii) Since the DPCO will furnish the report to GAO, the protestor, 
and other interested parties, comments on the report from the protester 
and other interested parties will be requested to be sent to the DPCO.
    (7) The Office of Acquisition and Grants Management (OAGM) has been 
designated as the headquarters office, and the DPCO as the individual, 
that GAO should contact concerning all 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 principal official 
responsible for acquisition (PORA), and forward it, along with a written 
request for approval to make the award, to the Director, OAGM.
    (2) If the request to make an award notwithstanding the protest is 
approved by the Director, OAGM, 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 by the 
Director, OAGM, 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.
    (4) The contracting office shall prepare the protest file in 
accordance with 333.104(a)(2), and forward it, in duplicate, to the DPCO 
(see 333.104(a)(4)). The file shall be marked ``IMMEDIATE

[[Page 107]]

ACTION--PROTEST BEFORE AWARD.''
    (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, executed by the 
PORA, and forwarded, along with a written request for approval, to the 
Director, OAGM. The same procedures for notification stated in 
333.104(b)(2), above shall be followed.
    (6) The contracting officer shall prepare the protest file in 
accordance with 333.104(a)(3), and forward it, in duplicate, to the DPCO 
(see 333.104(a)(5)). The file shall be marked ``IMMEDIATE ACTION--
PROTEST AFTER AWARD.''
    (d) Findings and notice. The contracting officer shall perform the 
actions required by FAR 33.104(d); however, notification to GAO shall be 
made by the DPCO.
    (g) Notice to GAO. The Director, Office of Acquisition and Grants 
Management shall be the official to comply with the requirements of FAR 
33.104(g).
    (i) Express option. When GAO invokes the express option, the 
contracting officer shall prepare the complete protest file as described 
in 333.104(a)(3), to include item (i), and deliver it (hand-carry, if 
necessary) to the DPCO no later than the close of business on the ninth 
work day after the express option is invoked. The contracting officer 
shall involve OGC-BAL as early as possible after receiving notification 
of the invocation of the express option, and obtain the concurrence of 
the cognizant OGC-BAL attorney prior to transmitting the protest file to 
the DPCO. The DPCO shall prepare the report and submit it and the 
protest file to GAO.
[50 FR 23133, May 31, 1985, as amended at 50 FR 38004, Sept. 19, 1985; 
54 FR 24344, June 7, 1989; 55 FR 42197, Oct. 18, 1990; 56 FR 47003, 
Sept. 17, 1991]



333.105  Protests to GSBCA.

    (a)(1) The contracting officer shall give telephone notification to 
the DPCO, OGC-BAL, and the contracting activity's protest control 
officer immediately upon notification of the protest.
    (2)(i) The contracting officer is responsible for complying with the 
requirement in FAR 33.105(a)(2)(i).
    (ii) The cognizant OGC-BAL attorney is responsible for complying 
with the requirement stated in FAR 33.105(a)(2)(ii).
    (b) As soon as possible but no later than six (6) work days after 
the filing of the protest, a copy of the protest file containing all 
documents (see FAR 33.105(b), especially (b)(7)), and labeled on the 
cover ``FOR USE BY DPCO ONLY'', shall be in the hands of the DPCO for 
review. Simultaneously, two copies of the same protest file provided to 
the DPCO shall be provided to the cognizant OGC-BAL attorney. These two 
copies shall be labeled on the cover ``FOR USE BY OGC-BAL.'' After 
consultation with the cognizant OGC-BAL attorney, the DPCO shall 
transmit the protest file to the GSBCA.
    (1) Rather than furnishing a decision, the contracting officer shall 
include a statement of facts and circumstances and a discussion of the 
merits of the protest, as well as conclusions and recommendations and 
documentary evidence on which they are based. These statements shall be 
reviewed by the cognizant OGC-BAL attorney before being finalized.
    (7) The DPCO shall provide all parties with a list of documents 
furnished to the GSBCA for in camera review.
    (10) The copies of the protest files to be provided to the DPCO and 
OGC-BAL shall also contain the documents or information specified in 
333.104(a)(3)(vii) through (xii). The file shall be assembled in an 
orderly manner and include an index of enclosures.
    (c) The cognizant OGC-BAL attorney is responsible for complying with 
the requirement stated in FAR 33.105(c).
    (d)(1) If the protest requests a suspension of acquisition 
authority, the contracting officer must make this known to the DPCO, 
OGC-BAL, and the contracting activity's protest control officer at the 
time of the initial telephone notification of the filing of the protest 
to afford an opportunity for the DPCO, OGC-BAL, principal official 
responsible for acquisition (PORA), and contracting officer to take 
appropriate action.

[[Page 108]]

    (2) If it can be established that the conditions stated in FAR 
33.105(d)(1)(i) and (ii) are present, the contracting officer shall 
prepare a D&F setting forth the circumstances. The D&F shall be 
concurred in by the cognizant OGC-BAL attorney before being executed by 
the PORA (not delegable).
    (g) If an appeal is to be made by the Department regarding a final 
decision issued by the GSBCA, it shall be made by OGC-BAL.
[50 FR 23133, May 31, 1985, as amended at 50 FR 38004, Sept. 19, 1985; 
56 FR 47003, Sept. 17, 1991]



333.106  Solicitation provision and contract clause.

    (a) The provision at FAR 52.233-2, Service of Protest, shall be 
completed by entering the name and complete mailing address of the 
contracting officer.
[50 FR 23133, May 31, 1985, as amended at 50 FR 38004, Sept. 19, 1985]



                   Subpart 333.2--Disputes and Appeals

    Source:  53 FR 15563, May 2, 1988, unless otherwise noted.



333.203  Applicability.

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



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.



333.210  Contracting officer's authority.

    The contracting officer shall refer a proposed final decision to the 
Office of General Counsel, Business and Administrative Law Division 
(OGC-BAL), or the Regional Attorney in the HHS regional office servicing 
the region in which the contracting officer is located, for advice as to 
the legal sufficiency and format before sending the final decision to 
the contractor. The contracting officer shall provide OGC-BAL or the 
Regional Attorney with the pertinent documents with the submission of 
each proposed final decision.



333.211  Contracting officer's decision.

    (a)(2) See 333.210.
    (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''.
    (c)(2) The contracting officer does not have jurisdiction to 
consider a claim from the contractor over $50,000, unless that claim has 
been certified.
    (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-BAL or the cognizant Regional 
Attorney with the supplement to the contract file which supports the 
recommended correction or amendment.



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. Claims Court, as appropriate.
    (b) OGC-BAL or the cognizant Regional Attorney 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;

[[Page 109]]

    (3) All correspondence between the parties pertinent to the appeal, 
including the letter or letters of claims 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 witnesses 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, acting under the guidance of the Government Trial 
Attorney, shall be responsible for arranging for the presence of 
Government witnesses and specified physical and documentary evidence at 
both the pre-hearing conference and the 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 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. Claims 
Court, the U.S. Department of Justice will represent the Department. 
However, the contracting officer shall still coordinate all actions 
through OGC-BAL.



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 Contracts 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 Division of 
Business and Administrative Law, Office of General Counsel, Department 
of Health and Human Services, 330 Independence Avenue SW., Washington, 
DC 20201, or Regional Attorney and office address, as appropriate).
    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 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 may 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



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 (h) 
in Alternate I, he/she must request approval for its

[[Page 110]]

use from the Director, Division of Acquisition Policy (through normal 
acquisition channels).
[53 FR 15563, May 2, 1988, as amended at 54 FR 24344, June 7, 1989]



333.214  Contract clause.

    The clause at FAR 52.233-1 shall be used in all circumstances except 
as indicated in 333.213.

[[Page 111]]



             SUBCHAPTER F--SPECIAL CATEGORIES OF CONTRACTING





PART 334--MAJOR SYSTEM ACQUISITION--Table of Contents




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



334.003  Agency head responsibilities.

    The Department's implementation of OMB Circular No. A-109 may be 
found in Chapter 1-150 of the General Administration Manual.
[49 FR 14020, Apr. 9, 1984]



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  Institutional cost-sharing agreements.
335.070-5  Contract clauses.
335.070-6  Contract award.

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

    Source:  49 FR 14020, Apr. 9, 1984, unless otherwise noted.



335.070  Cost-sharing.



335.070-1  Policy.

    (a) In addition to utilizing cost-sharing type contracts when 
required by statute, the desirability of utilizing this type of 
contract, when authorized should also be considered under certain 
circumstances when not required by statute. Contractors 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 interest 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. If cost-sharing 
is not required by statute, encouragement should be given to 
organizations to contribute to the cost of performing research under 
research 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 requests 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) Cost-sharing may be negotiated in either of two ways. When cost-
sharing is negotiated on a contract by contract basis, the 
responsibility for negotiating the cost-sharing arrangement is that of 
the contracting officer. In the case of institutional cost-sharing 
arrangements (see 335.070-4), the responsibility for negotiating cost-
sharing is that of the Office of the Assistant Secretary for Health. 
Each research contract file should show whether the contracting officer 
considered cost-sharing appropriate for that particular contract and, 
except when an institutional cost-sharing agreement is applicable, 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

[[Page 112]]

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, 
except when cost-sharing is required by statute, 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.
[49 FR 14020, Apr. 9, 1984; 49 FR 36110, Sept. 14, 1984]



335.070-2  Amount of cost-sharing.

    When cost-sharing is required by statute or determined to be 
appropriate, the following guidelines shall be utilized in determining 
the amount of cost participation by the contractor, except where an 
institutional cost-sharing agreement is applicable:
    (a) Cost participation by educational institutions and other not-
for-profit or nonprofit organizations should normally be at least 1 
percent of the total project cost. In many cases, cost-sharing of less 
than 5 percent of the total project cost would be appropriate in view of 
the organizations' nonprofit status and their normally limited ability 
to recover the cost of such participation from non-Federal sources. 
However, in some cases, it may be appropriate for educational 
institutions to provide a higher degree of cost-sharing, such as when 
the cost of the research consists primarily of the academic year salary 
of faculty members (or when the equipment acquired by the institution 
for the project will be of significant value to the institution in its 
educational activities). The percentages stated above are not intended 
as a substitution for those set forth in any legislation and are not to 
be used in lieu of those contained in that legislation.
    (b) The amount of cost participation by commercial or industrial 
organizations should depend to a large extent on whether the research 
effort or results are likely to enhance the performing organization's 
capability, expertise, or competitive position, and the value of such 
enhancement to the performing organization. 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 derive a monetary benefit from 
their research under Federal agreements. Therefore, cost participation 
by commercial or industrial organizations 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.
    (c) If the performing organization will not acquire title to 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 such 
rights.
    (d) When cost-sharing is required by statute, cost participation of 
less than 1 percent may be appropriate if consistent with the provisions 
of the statute, and:
    (1) A formal request for proposal is issued;
    (2) The contractor proposes to perform the research primarily as a 
service to the Government; or
    (e) The contractor has little or no non-Federal sources of funds 
from which to make a cost contribution.
    (3) 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 the costs of the project.
    (f) 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

[[Page 113]]

by a relatively low contribution in another.
    (g) 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.
    (h) In the final analysis, the amount of cost participation should 
reflect the mutual agreement of the parties, provided that it is 
consistent with any statutory requirements.



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).
[49 FR 14020, Apr. 9, 1984. Correctly designated at 49 FR 36110, Sept. 
14, 1984]



335.070-4  Institutional cost-sharing agreements.

    (a) An institutional cost-sharing agreement covers the aggregate of 
some or all of the research projects supported by HHS research contracts 
and grants at a given performing organization. With respect to 
contracts, these agreements will apply only to cost-sharing type 
contracts resulting from unsolicited proposals and awarded without fee 
or profit. Eligibility for institutional cost-sharing agreements is 
limited to nonprofit institutions of higher education and other public 
or private nonprofit or not-for-profit organizations. Usually, a single 
agreement will cover all applicable research projects at a given 
performing organization; however, in unusual cases, separate agreements 
for individual departments or locations of the performing organization 
may be negotiated if deemed advantageous.
    (b) The institutional cost-sharing agreements establish an overall 
sharing ratio applicable to the aggregate of all covered projects. 
Individual awards will incorporate the institutional agreement by 
reference, but will not establish a specific sharing ratio for the 
individual project. The amount of sharing on any particular project will 
therefore be left to the discretion of the performing organization, and 
relatively high contributions on some projects may offset relatively low 
contributions on other projects, provided that the agreed aggregate 
contribution is made during each of the contractor's fiscal years, and a 
contribution, even if nominal, is made to each covered project.
    (c) The Public Health Service shall be responsible for negotiating 
all HHS institutional cost-sharing agreements. Agreements, when 
negotiated, will be binding upon all HHS activities. Eligible 
contractors wishing to negotiate institutional cost-sharing agreements 
should contact the Division of Grants and Contracts, Office of Resource 
Management, Public Health Service, Room 18 A 19, Parklawn Building, 5600 
Fishers Lane, Rockville, Maryland 20857.
    (1) All necessary implementing instructions to cover matters such as 
content of proposals, format of agreements, documentation, etc. shall be 
issued by the Public Health Service, subject to the prior approval of 
the Office of Acquisition and Grants Management.
    (2) The Public Health Service shall provide the Office of 
Acquisition and Grants Management, and the Department's operating 
divisions with current listings of all institutional cost-sharing 
agreements, indicating the date on which they became effective with 
respect to contracts. Copies of individual agreements will be made 
available to the Department's other activities upon request. Each 
activity shall designate only one individual who shall be authorized to 
make such requests.
    (d) The amount of cost-sharing negotiated under an institutional 
cost-sharing agreement will be determined in accordance with the 
appropriate guidelines contained in ``A Guide to Institutional Cost 
Sharing Agreements'' issued by the Office of Resource Management, PHS. 
The extent to which the performing organization shared in the costs of 
HHS-sponsored research in the

[[Page 114]]

past, and its anticipated ability to do so in the future, should also be 
taken into account.
[49 FR 14020, Apr. 9, 1984, as amended at 54 FR 24344, June 7, 1989]



335.070-5  Contract clauses.

    Clauses for cost sharing in individually negotiated contracts or 
under institutional agreements are set forth in 352.232-71.



335.070-6  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.



PART 337--SERVICE CONTRACTING--Table of Contents




                Subpart 337.1--Service Contracts--General

Sec.
337.101  Definitions.
337.103  Contracting officer responsibility.
337.104  Personal services contracts.
337.109  Services of quasi-military armed forces.

                   Subpart 337.2--Consulting Services

337.204  Policy.
337.270  Consulting services reporting.

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

    Source:  49 FR 14022, Apr. 9, 1984, unless otherwise noted.



                Subpart 337.1--Service Contracts--General



337.101  Definitions.

    Service contract. A contract may require the furnishing of both 
property and services, such as a research and development contract which 
requires a final report. In a case such as this, this subpart will apply 
to the extent that the furnishing of services is involved. Other 
examples of service contracts include training and education, surveys 
and data collection, data processing, medical services, and stenographic 
services.



337.103  Contracting officer responsibility.

    (b) Contract actions for the services of experts and consultants are 
also exempt from the requirements of FAR Part 37.103(a)(3); they are to 
be certified in accordance with the provisions in General Administration 
Manual Chapter 8-15.
    (c) For negotiated acquisitions, the determination shall be included 
as a statement in the negotiation memorandum. For sealed bid 
acquisitions, the determination shall be included as a separate 
statement in the contract file.
    (d) In most cases, gathering the information and data on which to 
base the determination should be a joint effort between contracting and 
program personnel. The contracting officer shall request the advice of 
the Office of General Counsel and/or the personnel office before 
processing any request to acquire services if there is doubt as to 
whether an employer-employee relationship would be involved in 
performance of the contract.
[49 FR 14022, Apr. 9, 1984, as amended at 50 FR 23126, May 31, 1985; 50 
FR 38004, Sept. 19, 1985]



337.104  Personal services contracts.

    (a) As indicated in FAR 37.104, the paramount consideration in 
determining if an employer-employee relationship exists is the presence 
of direction or supervision by Government personnel of contractor 
employees, as a result of either the inherent nature of the service or 
the manner in which the service is provided. A personal service 
relationship exists if this direction or supervision is necessary to:
    (1) Adequately protect the Government's interest;
    (2) Retain control of the function involved; and/or
    (3) Retain full personal responsibility by a duly authorized Federal 
officer or employee for the function supported.

[[Page 115]]

    (c)(2) The degree of supervision necessary to establish an employer-
employee relationship is relatively continuous, close supervision. 
Sporadic supervision is not sufficient to constitute an employer-
employee relationship. (In determining whether the Government rather 
than the contractor exercises ``relatively continuous, close 
supervision'' of contractor personnel, the fact that an engineer, for 
example, may require less supervision and may exercise more independence 
of judgment than a food service worker is not itself determinative. If 
the Government takes over that degree of supervision that the contractor 
would otherwise exercise over either individual, the relationship 
created between the Government and either individual is tantamount to 
that of employer and employee.)
    (d) The likelihood of the existence of an employer-employee 
relationship increases as the number and extent of the elements in FAR 
37.104(d) increases. However, the mere existence of these elements does 
not constitute an employer-employee relationship unless continuous, 
close supervision exists. In determining the presence of the referenced 
elements, relevant factors including the following shall be considered:
    (1) The nature of the work. (i) If the Government can use Federal 
personnel to perform the required work, or if the Government has rights 
to the specialized knowledge or equipment which is needed to perform the 
work;
    (ii) Whether the services represent the discharge of a Government 
function which calls for the exercise of personal judgment and 
discretion on behalf of the Government. (This factor, if present in 
sufficient degree, may alone render the service personal in nature.); 
and/or
    (iii) If the services are to be a one-time occurrence (or a 
continuing requirement of short term duration).
    (2) Contractual provisions concerning the contractor's employees. 
(i) To what extent the Government specifies the qualifications of, or 
has the right to approve, individual contractor employees (other than 
the Government's right to approve or disapprove new key personnel, 
remove key personnel, grant or deny security clearances, and provide for 
necessary health qualifications). (Also, it is permissible for the 
Government to specify the technical and experience qualifications of 
contractor employees, if this is necessary to assure satisfactory 
performance.);
    (ii) To what extent the Government can assign tasks to, and prepare 
work schedules for, contractor employees during performance of the 
contract. (This does not preclude inclusion in the contract of work 
schedules for the contractor--but not individual employees--or the 
establishment of a time of performance for orders issued under a 
requirement or other indefinite delivery-type contract.);
    (iii) To what extent the Government can supervise or control the 
method in which the contractor performs the service, the number of 
people that will be employed, the specific duties of individual 
employees, and similar details. (However, it is permissible to require 
that contractor employees comply with regulations for the protection of 
life and property. Also, it is permissible to recommend a specific 
number of people the contractor may employ, if this is necessary to 
assure performance; but in that event, the contract must specify that 
this does not in any way minimize the contractor's obligation to use as 
many employees as are necessary for proper contract performance.);
    (iv) If the Government can review performance of each individual 
contractor employee (as opposed to reviewing the final product after 
completion of the work.); and/or
    (v) If the Government has the right to have contractor employees 
removed from the job for reasons other than misconduct or security.
    (3) Other provisions of the contract. (i) Whether the contractor 
undertakes a specific task or project that is definable either at the 
inception of the contract or at some point during performance, or 
whether the work is defined on a day-to-day basis. (However, this does 
not preclude use of a requirement or other indefinite delivery-type 
contract, provided the nature of the work is specifically described in 
the contract, and orders are formally issued to the contractor rather 
than to individual employees.);

[[Page 116]]

    (ii) Whether payment will be for results accomplished or solely 
according to time worked. (This is a factor which might be useful in a 
doubtful case, but should not in itself create doubt about services 
which are otherwise clearly nonpersonal.); and/or
    (iii) Whether Government office or working space, facilities, 
equipment, and supplies will be used for contract performance. (This is 
a factor which might be useful in a doubtful case, but should not in 
itself create doubt about services which are otherwise clearly 
nonpersonal.).
    (4) Administration of the contract. (i) If contractor employees are 
used interchangeably with Government personnel; and/or
    (ii) If contractor employees are integrated into the Government's 
organizational structure.
    (e) and (f) Reserved.
    (g) The following are examples of personal and nonpersonal services, 
but are illustrative only and are not to be used as the basis for 
determination in any specific case.
    (1) The following are examples of personal services contracts:
    (i) A contract to furnish ordinary, day-to-day, stenographic and 
secretarial services in a Government office under direct Government 
supervision.
    (ii) A contract for the testing of a substance where the project 
officer visits the contractor's facility several times each week to 
consult with the principal investigator, review data, specify methods of 
quality control, specify testing to be done, and provide instruction to 
investigators.
    (iii) A contract for the performance of a function which management 
must perform in order to retain essential control over the conduct of 
agency programs (e.g., negotiating contract amounts).
    (2) The following are examples of nonpersonal services contracts:
    (i) A contract for technical assistance work requiring specialized 
equipment and trained personnel unavailable to the Government. The 
contractor performs work described in the contract free of Government 
supervision, and does not act on behalf of the Government.
    (ii) A contract with an individual for delivery of lectures without 
Government supervision (even if they are to be given on specific dates, 
or on specialized subjects, or if payment will be by the hour).
    (iii) A fixed price contract for janitorial services which provides 
for specific tasks to be performed in specific places, free of 
Government direction, supervision, and control over the contractor's 
employees.
    (iv) A research and development contract providing for a level of 
effort which will be performed by the contractor independent of 
Government direction, supervision, and control.



337.109  Services of quasi-military armed forces.

    As distinguished in FAR 37.109, solicitations for protective 
services shall include the following certification:

    The bidder/offeror certifies it is not a detective agency, nor an 
employee of such agency as contemplated by 5 U.S.C. 3108.



                   Subpart 337.2--Consulting Services



337.204  Policy.

    General Administration Manual Chapter 8-15 prescribes policies and 
procedures concerning approvals required before contracting for expert 
or consulting services.
    (e) Services of experts or consultants may be acquired by contract 
only when:
    (1) The services will be nonpersonal in nature, are critical to the 
planning, development, operation, or evaluation of a Department program, 
cannot be accomplished by Government employees, and are economically 
available from the private sector; or
    (2) The performance of the work by a consultant is directed by 
statute.



337.270  Consulting services reporting.

    The clause set forth in 352.237-70 shall be included in every 
contract for expert or consulting services.

[[Page 117]]



PART 339--MANAGEMENT, ACQUISITION, AND USE OF INFORMATION RESOURCES--Table of Contents




           Subpart 339.70--ADP Clearances and Systems Security

Sec.
339.7001  ADP Clearances.
339.7002  ADP systems security.

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

    Source:  49 FR 14023, Apr. 9, 1984, unless otherwise noted.



           Subpart 339.70--ADP Clearances and Systems Security



339.7001  ADP clearances.

    In accordance with Chapter 4-10 of the HHS Information Resources 
Management (IRM) Manual, the Office of Information Resources Management 
(OIRM), OASMB-OS, is responsible for the review and approval of all 
requests for proposed automatic data processing (ADP) systems and 
modifications to existing ADP systems which require the acquisition of 
ADP hardware, software packages, and services, and telecommunications 
equipment, which exceed the dollar thresholds stated in Chapter 4-10.
    (a) It is the responsibility of the program office to obtain written 
approval from OIRM on proposed ADP acquisitions which exceed the 
thresholds stated in Exhibit 4-10-A of Chapter 4-10 prior to submitting 
the request for contract to the contracting activity.
    (b) The OIRM approval document (delegation of procurement authority 
(DPA)) is to be attached to the request for contract when it is 
submitted by the program office to the contracting activity. The 
contracting activity shall not issue a solicitation based on the request 
for contract until a properly executed approval document (DPA) is 
obtained.
[49 FR 14023, Apr. 9, 1984, as amended at 53 FR 43208, Oct. 26, 1988]



339.7002  ADP systems security.

    (a) Program responsibilities. Whenever a proposed contract action 
requires the design, development, maintenance, or use of an ADP system 
or the use of ADP resources, the program office is required to designate 
a responsible individual to serve as the ADP system manager who is to 
ensure, in coordination with the cognizant systems security officer, 
that ADP security requirements are met and that each contractor 
maintains an acceptable security program. The project officer is 
responsible for setting forth the specific portions of Part 6, ADP 
Systems Security, of the HHS IRM Manual which are applicable to the 
instant acquisition.
    (b) Contracting responsibilities. (1) The contracting officer is 
responsible for ensuring that a certification of ADP systems security 
requirements, signed by both the ADP system manager and the ADP systems 
security officer, is submitted with the request for contract. The 
contracting officer shall not initiate action on the request for 
contract until the properly executed certification is received. The 
certification will state that the security requirements specified are 
reasonably sufficient for the intended application and that they comply 
with current Federal and HHS computer security policies, procedures, 
standards, and guidelines.
    (2) When developing the request for proposals, the contracting 
officer shall include in the technical proposal instructions a statement 
requiring that the offeror present a detailed outline of its proposed 
ADP system security program which complies with the requirements of the 
statement of work and applicable portions of Part 6, ADP Systems 
Security, of the HHS IRM Manual.
    (3) The contracting officer shall include a special provision 
reading substantially as follows in all applicable solicitations and 
resultant contracts:

    The Contractor agrees to comply with the ADP system security 
requirements set forth in the system of work and applicable portions of 
Part 6, ADP Systems Security, of the HHS IRM Manual. The Contractor 
further agrees to include this provision in any subcontract awarded 
pursuant to this prime contract.

    (4) The contracting officer shall ensure that a properly executed 
certification confirming that the offerors comply with the necessary 
security requirements is attached to the technical evaluation report 
received from the evaluation panel before proceeding

[[Page 118]]

with the acquisition process. This certification must be countersigned 
by the officials designated in paragraph (b)(1) above and must contain a 
similar statement of compliance.
[49 FR 14023, Apr. 9, 1984, as amended at 53 FR 43208, Oct. 26, 1988]

[[Page 119]]



                    SUBCHAPTER G--CONTRACT MANAGEMENT





PART 342--CONTRACT ADMINISTRATION--Table of Contents




                  Subpart 342.5--Postaward Orientation

Sec.
342.504  Postaward letters.

                   Subpart 342.7--Indirect Cost Rates

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  Applicability.
342.7102  General.
342.7103  Contract administration.
342.7103-1  General.
342.7103-2  Procedures.
342.7104  Contract modifications.

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

    Source:  49 FR 14024, Apr. 9, 1984, unless otherwise noted.



                  Subpart 342.5--Postaward Orientation



342.504  Postaward letters.

    To the extent practicable, contracting officers should use letters 
to accomplish postaward orientation objectives. A postaward orientation 
conference should only be arranged when letters cannot resolve key 
issues.



                   Subpart 342.7--Indirect Cost Rates



342.705  Final indirect cost rates.

    The Director, Division of Cost Allocation of the Regional 
Administrative Support Center within each 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.



                   Subpart 342.70--Contract Monitoring



342.7001  Purpose.

    Contract monitoring is an essential element of contract 
administration and the acquisition process. This subpart describes the 
Department's operating concepts regarding contract monitoring, performed 
jointly by the project officer and the contracting officer, to ensure 
that the required monitoring is performed, timely remedial action is 
taken when necessary, and a determination is made that contract 
objectives have been met.



342.7002  Contract monitoring responsibilities.

    (a) Upon execution of the contract, the mutual obligations of the 
Government and the contractor are established by, and limited to, the 
written stipulations in the contract. Unless authorized by the 
contracting officer, HHS personnel shall not direct or request the 
contractor to assume any obligation or take any actions not specifically 
required by the contract. Only the contracting officer may impose a 
requirement which will result in a change to the contract. All contract 
changes must be directed in writing or confirmed in writing by the 
contracting officer.
    (b) The contracting officer is responsible for assuring compliance 
with all terms of the contract, especially the statutory, legal, 
business, and regulatory provisions. Whether or not a postaward 
conference is held, the contracting officer shall inform the contractor 
by letter (if not already stipulated by contract provisions) of the 
authorities and responsibilities of the Government personnel with whom 
the contractor will be dealing throughout the life of the contract.
    (c) The contracting officer must depend on program, technical, and 
other

[[Page 120]]

personnel for assistance and advice in monitoring the contractor's 
performance, and in other areas of postaward administration. The 
contracting officer must assure that responsibilities assigned to these 
personnel are understood and carried out. 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 to assist or advise the contracting officer (or act as his/her 
representative when so designated by the contracting officer) in 
activities such as:
    (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;
    (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. This shall be accomplished by a written request to the 
contracting officer, together with an appropriate justification and 
funds availability citation;
    (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 
subcontracts, 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 performing required aspects 
of the contract monitoring process. In addition to those applicable 
activities set forth in (c)(1) above, the project officer shall:
    (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 will, in turn, provide the contractor with written notification 
of approval or disapproval unless the responsibility has been delegated 
by the contracting officer, in which case the person responsible for 
such action will notify the contractor and provide a copy to the 
contracting officer for inclusion in the contract file;
    (ii) Monitor the technical aspects of the contractor's business and 
technical progress, 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, so that remedial measures may be instituted accordingly;
    (iii) Provide immediate notification to the head of the program 
office responsible for the program whenever it is determined that 
program objectives are not being met, together with specific 
recommendations of action to be taken. A copy of the project officer's 
report and recommendations shall be transmitted to the contracting 
officer for appropriate action;
    (iv) Submit, within 120 days after contract completion, a final 
assessment report to the contracting officer. The report should include 
an 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 followup, as necessary; and
    (v) Accompany and/or provide, when requested, technical support to 
the HHS auditor in the conduct of floor checks.
    (3) The role of the contract administrator, auditor, cost analyst, 
and property administrator in assisting or advising 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

[[Page 121]]

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 are carried out in 
conformance with contract provisions. 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 action being taken by the 
contracting officer.
    (e) Contract cost and manpower reporting shall be required on all 
cost-reimbursement type contracts financed under letter of credit or 
Departmental Federal Assistance Financing System (DFAFS) methods of 
payment regardless of dollar value, and on all other cost-reimbursement 
type contracts of $100,000 or more. Financial reporting may be required 
on cost-reimbursement contracts under $100,000, when financed by other 
than the letter of credit or DFAFS methods, but only if it is necessary 
for effective contract administration. Financial and manpower 
information may be submitted either as a separate contract financial 
report or as an addendum to a public voucher, as prescribed by the 
contracting officer. Frequency, format (including instructions), extent, 
structure (including cost elements and labor categories), and 
distribution of reporting fall within the discretion of the contracting 
officer. The contracting officer shall set forth financial reporting 
requirements in all applicable RFPs and contracts, shall limit the 
requirements to those necessary for effectual cost and manpower 
management of the contract, and shall avoid the use of reporting 
requirements that are unduly burdensome on the contractor.
[49 FR 14024, Apr. 9, 1984, as amended at 54 FR 43966, Oct. 30, 1989; 54 
FR 47750, Nov. 16, 1989]



342.7003  Withholding of contract payments.



342.7003-1  Policy.

    (a) All solicitations and resultant contracts shall contain a 
withholding of contract payments clause and an excusable delays clause 
or a clause which incorporates the definition of excusable delays. These 
clauses are contained in the Department's contract general provisions.
    (b) The transmittal letter used to convey the contract to each 
contractor shall contain a notice which highlights the contractor's 
agreement with the withholding of contract payments clause.
    (c) No contract payment shall be made when any report required to be 
submitted by the contractor is overdue, or the contractor fails to 
perform or deliver work or services as required by the contract.
    (d) The contracting officer shall issue a ten-day cure notice or 
initiate appropriate termination action for any failure in the 
contractor's performance as stated in the preceding paragraph (c).



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 provisions of the 
contract. Compliance with the reporting provisions includes those 
reports to be submitted directly to the payment office. If such a report 
is not submitted on time, the contracting officer is to be notified 
promptly by the payment office.
    (b) When the contract contains a termination for default clause, the 
contractor's failure to either submit any required report when due or 
perform or deliver services or work when required by the contract is to 
be considered a

[[Page 122]]

default in performance. In either circumstance, the contracting officer 
is to immediately issue a formal ten-day cure notice pursuant to the 
default clause. The cure notice is to follow the format prescribed in 
FAR 49.607 and is to include a statement to the effect that contract 
payments will be withheld if the default is not cured or is not 
determined to be excusable.
    (1) If the default is cured or is determined to be excusable, the 
contracting officer is not to 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 is to 
initiate withholding action on all contract payments and is to 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 either submit any required report 
when due or perform or deliver services or work when required by the 
contract is to be considered a failure to perform. In either 
circumstance, the contracting officer is to immediately issue a written 
notice to the contractor specifying the failure and providing a period 
of ten days, or a longer period as determined necessary by the 
contracting officer, in which the contractor is to cure the failure or 
establish an excusable delay. The contracting officer is to include a 
statement in the written notice to the effect that contract payments 
will be withheld if the failure is not cured or is not determined to be 
excusable.
    (1) If the failure is cured or is determined to be excusable, the 
contracting officer is not to 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 is to 
initiate withholding action on all contract payments and is to 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.



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, 
the contracting officer is to immediately notify the servicing finance 
office in writing of the determination to suspend payments. The notice 
of suspension is to contain all elements of information required by the 
payment office to properly identify the contract and the applicable 
accounts involved.
    (b) The contracting officer is to 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 is to 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.



        Subpart 342.71--Administrative Actions for Cost Overruns



342.7100  Scope of subpart.

    This subpart sets forth the procedures to be followed when a cost 
overrun is anticipated; i.e., the allowable actual cost of performing a 
cost-reimbursement type contract is expected to exceed the total 
estimated cost specified in the contract.



342.7101  Applicability.

    This subpart applies to the administration of cost-reimbursement 
type contracts and the cost-reimbursement portion of other types of 
contracts. Nothing in this subpart shall be construed to relieve 
contractors from compliance with the Limitation of Cost clause or any 
other provisions of contracts.

[[Page 123]]



342.7102  General.

    Reimbursement for costs incurred under cost-reimbursement contracts 
shall not exceed the amount of funds obligated by the contract, unless 
increased by the contracting officer. Cost overruns shall be held to an 
absolute minimum, compatible with accomplishment of the statement of 
work.



342.7103  Contract administration.



342.7103-1  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.



342.7103-2  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 is to include:
    (1) Name and address of contractor.
    (2) Contract number and expiration date.
    (3) Contract item(s) and amount(s) creating the 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 in order 
to obtain a timely decision as to whether the work under the contract 
should be continued and additional funds provided, or the contract 
terminated. The decision of the program office must be supported by an 
appropriate written statement and funding authority, or a formal request 
for termination, when applicable. After a programming and funding 
decision is received from the program office, the contracting officer 
shall promptly notify the contractor in writing that:
    (i) A specified amount of additional funds has been allotted to the 
contract by a contractual instrument; or
    (ii) Work will be discontinued when the funds allotted to the 
contract have been exhausted, and that any work performed after that 
date is at the contractor's risk; or
    (iii) The Government is considering whether additional funds should 
be allotted to the contract and will notify the contractor as soon as 
possible, but that any work performed after the funds then allocated to 
the contract have been 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.



342.7104  Contract modifications.

    (a) Modifications to contracts containing the Limitation of Cost 
clause shall include either:

[[Page 124]]

    (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 increase 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.



PART 345--GOVERNMENT PROPERTY--Table of Contents




       Subpart 345.3--Providing Government Property to Contractors

Sec.
345.370  Providing Government property (in general).

     Subpart 345.4--Contractor Use and Rental of Government Property

345.405  Contracts with foreign governments or international 
          organizations.

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

    Source:  49 FR 14030, Apr. 9, 1984, unless otherwise noted.



       Subpart 345.3--Providing Government Property to Contractors



345.370  Providing Government property (in general).

    (a) A contractor may be provided Government property or allowed to 
acquire such property at Government expense upon determination that:
    (1) No practicable or economical alternative exists; e.g., 
acquisition from other sources, utilization of subcontractors, rental of 
property, or modification of program project requirements, etc.;
    (2) The Government receives adequate consideration for providing the 
property; or
    (3) Furnishing Government property is likely to result in 
substantially lower cost to the Government for the items produced or 
services rendered when all costs involved (e.g., transportation, 
installation, modification, maintenance, etc.) are compared with the 
cost to the Government of the contractor's use of privately-owned 
property.
    (b) The determination that it is necessary to provide a contractor 
or subcontractor with property will be made by the contracting officer 
with the advice of the agency property official.
    (c) If the program office is aware, prior to the submission of the 
request for contract, that it will be necessary to provide prospective 
contractors with property, a written justification must accompany the 
request for contract to the contracting activity.



     Subpart 345.4--Contractor Use and Rental of Government Property



345.405  Contracts with foreign governments or international organizations.

    Upon the request of a foreign government or international 
organization, or a contractor certifying that it is acting on behalf of 
a foreign government or international organization, the contracting 
officer, with advice from the agency property official cognizant of 
Government property located in the United States, its possessions, or 
Puerto Rico, may give written approval for its use without charge on 
contracts or subcontracts thereunder if:
    (a) The foreign government or international organization would be 
authorized to place the contract with the activity concerned under the 
Foreign Assistance Act of 1961, as amended, or such use is authorized by 
an agreement with the foreign government;
    (b) The foreign government's placement of the contract directly with 
the contractor is consistent with the best interests of the United 
States;
    (c) It appears that the foreign government will place the contract 
with the contractor whether or not use is authorized, and no competitive 
pricing advantage will accrue to the contractor by virtue of its use;
    (d) The contractor agrees that no charge for the use of the property 
will

[[Page 125]]

be included in the price charged the foreign government under the 
contract; and
    (e) The use will not interfere with foreseeable requirements of the 
United States.

[[Page 126]]



                     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.
352.215-12  Restriction on disclosure and use of data.
352.215-71  [Reserved]
352.215-72  Pre-proposal conference.
352.216-70  Negotiated overhead rates--fixed.
352.216-72  Additional cost principles.
352.224-70  Confidentiality of information.
352.228-7  Insurance--Liability to third persons.
352.232-9  Withholding of contract payments.
352.232-71  Cost sharing.
352.232-73  Method of payment--letter of credit.
352.232-74  Estimated cost and fixed fee-incrementally funded contract.
352.232-75  Incremental funding.
352.233-70  Litigation and claims.
352.237-70  Consulting services reporting.
352.242-71  Final decisions on audit findings.
352.242-72--352.242-79  [Reserved]
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  Publication and publicity.
352.270-7  Paperwork Reduction Act.

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

    Source:  49 FR 14031, Apr. 9, 1984, unless otherwise noted.



             Subpart 352.2--Texts of Provisions and Clauses



352.202-1  Definitions.

    Insert the following clause in all solicitations and resultant 
contracts instead of the clause in FAR 52.202-1 except when 
contemplating (a) a fixed price research and development contract that 
is expected to be $2,500 or less or (b) a purchase order.

                         Definitions (Apr 1984)

    (a) The term Secretary or Head of the Agency (also called Agency 
Head) means the Secretary, Under 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) The term Contracting Officer means a person with the authority 
to enter into, administer, and/or terminate contracts and make related 
determinations and findings. The term includes certain authorized 
representatives of the Contracting Officer acting within the limits of 
their authority as delegated by the Contracting Officer.
    (c) The term Project Officer means the person representing the 
Government for the purpose of technical monitoring of contract 
performance. The Project Officer is not authorized to issue any 
instructions or directions which effect any increases or decreases in 
the scope of work or which would result in the increase or decrease of 
the price of this contract or a change in the delivery dates or 
performance period of this contract.
    (d) The term Department means the Department of Health and Human 
Services.
    (e) Except as otherwise provided in this contract, the term 
subcontract includes purchase order under this contract.

                             (End of clause)

    Alternate I (Apr 1984). For cost-reimbursement contracts other than 
purchase orders, delete paragraph (c) above and replace with the 
following paragraph (c):
    (c) The term Project Officer means the person representing the 
Government for the purpose of technical monitoring of contract 
performance. The Project Officer is not authorized to issue any 
instructions or directions which effect any increases or decreases in 
the scope of work or which would result in the increase or decrease of 
the cost of this contract or a change in performance period of this 
contract. In addition, the Project Officer is not authorized to receive 
or act upon the Contractor's notification of a revised cost estimate 
pursuant to the Limitation of Cost or Limitation of Funds clause of this 
contract.
[49 FR 14031, Apr. 9, 1984, as amended at 53 FR 15564, May 2, 1988]



352.215-12  Restriction of disclosure and use of data.

    Insert the following provision in all requests for proposals, and 
all requests for quotations other than those for information or planning 
purposes. This provision shall be used in lieu of the provision in FAR 
52.215-12.

[[Page 127]]

          Restriction on Disclosure and Use of Data (Apr 1984)

    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 legend, 
specifying the particular portions of the proposal which are to be 
restricted in accordance with the conditions of the legend. The 
Government's determination to withhold or disclose a record will be 
based upon the particular circumstances involving the record in question 
and whether the record may be exempted from disclosure under the Freedom 
of Information Act:
    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, 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).
    In addition, the offeror should mark each page of data it wishes to 
restrict with the following legend:
    Use or disclosure of data contained on this page is subject to the 
restriction on the cover sheet of this proposal or quotation.
    Offerors are cautioned that proposals submitted with restrictive 
legends or statements differing in substance from the above legend may 
not be considered for award. The Government reserves the right to reject 
any proposal submitted with a nonconforming legend.

                           (End of provision)



352.215-71  [Reserved]



352.215-72  Pre-proposal conference.

    If a pre-proposal conference is to be held as indicated in FAR 
15.409, insert the following provision in the affected solicitation:

                   Pre-Proposal Conference (Apr 1984)

    A pre-proposal conference will be held with prospective offerors at 
(insert local prevailing time) on (insert date) in room (insert room 
number) at (insert name and location of building).
    The pre-proposal conference will be held for the purpose of 
providing information concerning the Government's requirements which may 
be helpful in the preparation of proposals and for answering any 
questions which you have regarding this solicitation.
    The success of this type of conference depends largely on the 
leadtime available to the Government for research in connection with 
questions submitted by prospective offerors. Therefore, you are 
requested to mail written questions concerning any areas of uncertainty 
which, in your opinion, require clarification or correction, in 
sufficient time to be received on or before (insert date).
    Your questions should be submitted to the Contract-Officer, (insert 
name of Contracting Officer), and the envelope should be marked ``Pre-
Proposal Conference, RFP No. (insert number of RFP).'' A set of 
questions and answers will be furnished to all prospective offerors 
whether or not they are in attendance.
    Because of space limitations, each prospective offeror will be 
limited to a total of (insert number) representatives.
    Attendance at the pre-proposal conference is recommended; however, 
attendance is not a prerequisite for proposal submission and will not be 
considered a factor in proposal evaluation.

                           (End of provision)



352.216-70  Negotiated overhead rates--fixed.

    Insert the following clause in all cost-reimbursement contracts with

[[Page 128]]

educational institutions and nonprofit organizations when fixed rates 
subject to carryforward adjustments are used.

               Negotiated Overhead Rates--Fixed (Apr 1984)

    (a) Notwithstanding the provisions of the clause entitled 
``Allowable Cost and Payment,'' the allowable indirect costs under this 
contract shall be obtained by applying negotiated fixed overhead rates 
for the applicable period(s) to bases agreed upon by the parties, as 
specified below. A negotiated fixed rate(s) is based on an estimate of 
the costs which will be incurred during the period for which the rate(s) 
applies. When the application of the negotiated fixed rates against the 
actual bases during a given fiscal period produces an amount greater or 
less than the indirect costs determined for such period, such greater or 
lesser amount(s) will be carried forward to a subsequent period.
    (b) The Contractor, as soon as possible but no later than six months 
after the close of its fiscal year, or such other period as may be 
specified in the contract, shall submit to the Secretary or the duly 
authorized representative, with a copy to the cognizant audit activity, 
a proposed fixed overhead rate or rates based on the Contractor's actual 
cost experience during the fiscal year, including adjustment, if any, 
for amounts carried forward, together with supporting cost data. 
Negotiation of fixed overhead rates, including carryforward adjustments, 
if any, by the Contractor and the Secretary, or the duly authorized 
representative, shall be undertaken as promptly as practicable after 
receipt of the Contractor's proposal.
    (c) Allowability of costs and acceptability of cost allocation 
methods shall be determined in accordance with Part 31 of the Federal 
Acquisition Regulation (FAR) as in effect on the date of this contract.
    (d) The results of each negotiation shall be set forth in an 
amendment to this contract, which shall specify: (1) The agreed fixed 
overhead rates, (2) the bases to which the rates apply, (3) the fiscal 
year, unless the parties agreed to a different period, for which the 
rates apply, and (4) the specific items treated as direct costs or any 
changes in the items previously agreed to be direct costs.
    (e) Pending establishment of fixed overhead rates for any fiscal 
year or different period agreed to by the parties, the Contractor shall 
be reimbursed either at the rates fixed for the previous fiscal year or 
other period or at billing rates acceptable to the Contracting Officer, 
subject to appropriate adjustment when the final rates for that fiscal 
year or other period are established.
    (f) Any failure of the parties to agree on any fixed overhead rate 
or rates or to the amount of any carryforward adjustment under this 
clause shall not be considered a dispute concerning a question of fact 
for decision by the Contracting Officer within the meaning of the 
``Disputes'' clause of this contract. If for any fiscal year or other 
period specified in the contract, the parties fail to agree to a fixed 
overhead rate or rates, it is agreed that the allowable indirect costs 
under this contract shall be obtained by applying negotiated final 
overhead rates in accordance with the terms of the ``Allowable Cost and 
Payment'' clause set forth in FAR 52.216-7, as in effect on the date of 
this contract.
    (g) Submission of proposed fixed, provisional, and/or final overhead 
rates, together with appropriate data in support thereof, to the 
Secretary or the duly authorized representative and agreements on fixed, 
provisional, and/or final overhead rates entered into between the 
Contractor and the Secretary or the duly authorized representative, as 
evidenced by Negotiated Overhead Rate Agreements signed by both parties, 
shall be deemed to satisfy the requirements of paragraphs (b), (d), and 
(e), of this clause.

                             (End of clause)



352.216-72  Additional cost principles.

    As prescribed in 316.307(j), insert the following clause in all 
solicitations and resultant cost-reimbursement contracts with nonprofit 
organizations, as identified in OMB Circular A-122.

                  Additional Cost Principles (Oct 1990)

    (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 33 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.

[[Page 129]]

    (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 costs of independent research and development, including its 
proportionate share of indirect costs, are unallowable.

(End of clause)
[55 FR 42197, Oct. 18, 1990]



352.224-70  Confidentiality of information.

    The following clause is covered by the policy set forth in subpart 
324.70 and is to be used in accordance with the instructions set forth 
in 324.7004.

                Confidentiality of Information (Apr 1984)

    (a) Confidential information, as used in this clause, means (1) 
information or data of a personal nature about an individual, or (2) 
proprietary information or data submitted by or pertaining to an 
institution or 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 preliminary 
unvalidated findings could create erroneous conclusions 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 elsewhere in this contract that information 
to be utilized under this contract, or a portion thereof, 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, 
that is information or data of a personal nature about an individual, or 
proprietary information or data submitted by or pertaining to an 
institution or organization, 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 the Contracting Officer will be 
settled pursuant to the ``Disputes'' clause.
    (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 should obtain a written 
determination from the Contracting Officer prior to any release, 
disclosure, dissemination, or publication.
    (h) Contracting Officer determinations will reflect the results of 
internal coordination with appropriate program and legal officials.
    (i) 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)



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 subparagraph (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 a 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

[[Page 130]]

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 (i) of the reasonable cost of insurance 
allocable to this contract, and (ii) 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 of 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.
    (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 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 solicitation includes the provision 
at 52.228-6, Insurance-Immunity from Tort Liability, and the successful 
offeror represents in the offer that the offeror is partially immune 
from tort liability as a State agency or as a charitable institution, 
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.

[[Page 131]]

                             (End of clause)

    Alternate II (APR 1984). If the solicitation includes the provision 
at 52.228-6, Insurance-Immunity from Tort Liability, and the successful 
offeror represents in the offer that the offeror is totally immune from 
tort liability as a State agency or as a charitable institution, 
substitute the following paragraphs (a) and (b) for paragraphs (a) 
through (g) 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 claim or litigation.

                             (End of clause)

[56 FR 58316, Nov. 19, 1991]



352.232-9  Withholding of contract payments.

    Insert the following clause in all solicitations and contracts other 
than purchase orders:

               Withholding of Contract Payments (Apr 1984)

    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, will 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 
promptly notify the Contractor of its intention to withhold payment of 
any invoice or voucher submitted.

                             (End of clause)



352.232-71  Cost sharing.

    The policy relative to cost sharing is set forth in 335.070.
    (a) In contracts for which cost-sharing has been individually 
negotiated, the clause set forth in FAR 52.232-20 shall be used. Also, 
an article reading substantially as follows, which includes a cost-
sharing formula agreed upon by the contracting officer and the 
contractor that provides for the ratio of cost-sharing for both the 
originally established estimated cost and any increase pursuant to the 
FAR clause, shall be included in the contract.

                         Cost Sharing (Apr 1984)

    The Contractor agrees to share in the cost of the work hereunder to 
the extent of not less than (indicate percent of the total cost or 
dollar amount, etc.) and shall maintain records of all costs so 
contributed, as well as costs to be paid by the Government. Such records 
shall be subject to audit. Costs contributed by the Contractor shall not 
be charged to the Government under any other grant or contract 
(including allocation to other grants or contracts as part of an 
independent research and development program).

                             (End of clause)

    (b) In contracts for which cost-sharing will be in accordance with a 
previously negotiated institutional agreement, the clause set forth in 
FAR 52.232-20 shall also be used. However, instead of specifying a cost-
sharing formula, the following shall be included as a special provision.

          Cost Sharing Under Institutional Agreement (Apr 1984)

    This contract is subject to an Institutional Cost-Sharing Agreement 
which became effective with respect to HHS research contracts on (date), 
and the Contractor agrees that the Government shall not bear the entire 
cost of the work hereunder.

                             (End of clause)



352.232-73  Method of payment--letter of credit.

    When authorized by an individual or blanket determination, findings, 
and authorization for advance payment, under a letter of credit, the 
following clause shall be used: (See 332.406 for

[[Page 132]]

further instructions regarding use of the clause.)

             Method of payment--letter of credit (Apr 1984)

    (a) The Contractor shall be paid with funds made available under the 
Federal Reserve Letter of Credit No. ----, established by ------------ 
Department of Health and Human Services, against which the Contractor 
will withdraw funds pursuant to Federal Reserve Letter of Credit 
procedures contained in Treasury Department Circular 1075 (31 CFR Part 
205).
    (b) At the request of the Contractor and subject to the following 
conditions, the Government shall make an advance payment, or advance 
payments, from time to time, to the Contractor. No advance payment shall 
be made: (1) Without the approval of the office administering advance 
payments (hereinafter called the ``Administering Office'' and designated 
in paragraph (g)(2)) as to the financial necessity therefor (except in 
the case of educational institutions); (2) in an amount which, together 
with all advance payments made, exceeds the contract amount; and (3) 
without a properly certified invoice. The Contractor shall (1) initiate 
cash drawdowns only when actually needed for its disbursements, (2) 
report timely the case disbursements and balances as required by the 
Administering Office, and (3) impose the same standards of timing and 
amount upon any subcontractors including the furnishing of reports of 
cash disbursements and balances. Failure to adhere to these material 
provisions will be considered an event under paragraph (f) of this 
clause.
    (c) The funds drawn by the Contractor against the Federal Reserve 
Letter of Credit shall be only for current allowable expenditures 
necessary for the performance of this contract.
    (d) When requested in writing by the Contracting Officer, the 
Contractor shall repay to the Government such part of the unliquidated 
balance of the advance payments as shall, in the opinion of the 
Contracting Officer, be in excess of the Contractor's current needs or 
in excess of the contract price.
    (e) If, upon completion or termination of this contract, all amounts 
obtained by the Contractor under this letter of credit have not been 
fully liquidated by authorized charges under the contract, the balance 
thereof shall be deducted from any sums otherwise due to the Contractor 
from the Government, and any excess funds shall be repaid by the 
Contractor to the Government upon demand.
    (f) Upon the happening of any of the following events of default: 
(1) A finding by the Administering Office that the Contractor (i) has 
failed to observe any of the covenants, conditions, or warranties of 
these provisions or has failed to comply with any material provisions of 
this contract, or (ii) has so failed to make progress, or is in such 
unsatisfactory financial condition, as to endanger performance of this 
contract, or (iii) has allocated inventory to this contract 
substantially exceeding reasonable requirements, or (iv) is delinquent 
in payment of taxes or of the costs of performance of this contract in 
the ordinary course of business; (2) appointment of a trustee, receiver 
or liquidator for all or a substantial part of the Contractor's 
property, or institution of bankruptcy, reorganization, arrangement or 
liquidation proceedings by or against the Contractor; (3) service of any 
writ of attachment, levy of execution, or commencement of garnishment 
proceedings; or (4) the commission of an act of bankruptcy; the 
Government, without limiting any rights it may otherwise have, may, in 
its discretion and upon written notice to the Contractor, withhold 
further withdrawals under the Letter of Credit and withhold further 
payments on this contract. Payment can also be stopped for lack of 
submission of timely and accurate reports in accordance with contract 
requirements. Upon the continuance of any such events of default for a 
period of thirty (30) days after such written notice to the Contractor, 
the Government may, in its discretion, and without limiting any other 
rights which the Government may have, take the following additional 
actions as it may deem appropriate in the circumstances:
    (1) Charge interest on advance payments outstanding during the 
period of any such default at the rate established by the Secretary of 
the Treasury pursuant to Public Law 92-41, 80 Stat. 97 for the 
Renegotiation Board;
    (2) Demand immediate repayment of the unliquidated balance of 
advance payments hereunder; and/or
    (3) Take possession of and, with or without advertisement, sell at 
public sale at which the Government may be purchaser, or at a private 
sale, all or any part of the property on which the Government has a lien 
under this contract, and after deducting any expenses incident to such 
sale, apply the net proceeds of such sale in reduction of the 
unliquidated balance of advance payments hereunder and in reduction of 
any other claims of the Government against the Contractor.
    (g)(1) No interest shall be charged for advance payments made 
hereunder, except interest during a period of default as provided in 
paragraph (f)(2). The Contractor shall charge interest at the rate 
established by the Secretary of the Treasury pursuant to Public Law 92-
41 85 Stat. 97 for the Renegotiation Board on subadvances or 
downpayments to subcontractors and such interest will be credited to the 
account of the Government. However, interest need not be charged on

[[Page 133]]

subadvances on subcontracts with educational or research institutions 
provided such subcontracts are awarded without profit or fee for 
research, development or experimental work.
    (2) The office administering advance payments is designated as ----
------------.

                             (End of clause)



352.232-74  Estimated cost and fixed fee--incrementally funded contract.

    The following clause, or one reading substantially as it, shall be 
included in the Special Provisions of an incrementally funded contract:

         Consideration--Estimated Cost and Fixed Fee (Apr 1984)

    (a) It is estimated that the total cost to the Government for full 
performance of this contract will be $------, of which the sum of $----
-- represents the estimated reimbursable costs and $------ represents 
the fixed-fee.
    (b) Total funds currently available for payment and allotted to this 
contract are $------, of which $------ represents the estimated 
reimbursable costs and $------ represents the fixed-fee. For further 
provisions on funding, see the Limitation of Funds clause.
    (c) It is estimated that the amount currently allotted will cover 
performance of Phase I which is scheduled to be completed by (date) ----
--------.
    (d) The Contracting Officer may allot additional funds to the 
contract without the concurrence of the Contractor.

                             (End of clause)



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 (Apr 1984)

    (a) Sufficient funds are not presently available to cover the total 
cost of the complete multiple year project described in this 
solicitation. However, 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. Under that clause, which will be 
included in the resultant contract, initial funds will be obligated 
under the contract to cover the first year of performance. Additional 
funds are intended to be allotted to the contract by contract 
modification, up to and including the full estimated cost of the 
contract, to accomplish the entire project. While it is the Government's 
intention to progressively fund this contract over the entire period of 
performance up to and including the full estimated cost, the Government 
will not be obligated to reimburse the Contractor for costs incurred in 
excess of the periodic allotments, nor will the Contractor be obligated 
to perform in excess of the amount allotted.
    (b) The Limitation of Funds clause to be included in the resultant 
contract shall supersede the Limitation of Cost clause found in the 
General Provisions.

                           (End of provision)



352.233-70  Litigation and claims.

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

                    Litigation and Claims (Apr 1984)

    The Contractor shall give the Contracting Officer immediate notice 
in writing of (a) 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 (b) 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 (a) 
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 Contractors; and (b) 
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

[[Page 134]]

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)



352.237-70  Consulting services reporting.

    The contracting officer shall include the following clause in every 
contract for consulting services, as defined in the General 
Administration Manual Chapter 8-15 and as required by 337.270.

                Consulting Services Reporting (Apr 1984)

    The Contractor shall set forth on the cover of every report 
submitted pursuant to this contract the following information: (a) Name 
and business address of the Contractor; (b) Contract number; (c) 
Contract dollar amount; (d) Whether the contract was competitively or 
noncompetitively awarded; (e) Name of the Department's project officer 
and complete office identification and address; and (f) Names of the 
managerial and professional personnel responsible for the content and 
preparation of the report.

                             (End of clause)



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)



352.242-72--352.242-79  [Reserved]



352.249-14  Excusable delays.

    Insert the following clause in all solicitations and resultant 
contracts other than purchase orders which do not have either a default 
or excusable delays clause.

                       Excusable Delays (Apr 1984)

    (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 shall have ordered the Contractor in writing to 
procure such supplies or services from such other sources, and (3) The 
Contractor shall have failed to comply reasonably with such order. Upon 
request of the Contractor, the Contracting Officer shall ascertain the 
facts and extent of such failure and, if he/she shall determine that any 
failure to perform was occasioned by any one or more of the said causes, 
the delivery schedule shall be revised accordingly, subject to the 
rights of the Government under the termination clause hereof. (As used 
in this clause, the terms ``subcontractor'' and ``subcontractors'' mean 
subcontractor(s) at any tier.)

                             (End of clause)



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

    The following clause is to be used in accordance with 370.102:

  Accessibility of Meetings, Conferences, and Seminars to Persons with 
                         Disabilities (Apr 1984)

    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 below. This plan 
shall include a provision for ascertaining the number and types of 
disabled individuals planning to attend the meeting, conference, or

[[Page 135]]

seminar. 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 
accessible to persons with disabilities. The Contractor shall determine, 
by an on-site inspection if necessary, that the following minimum 
accessibility requirements are met, or suitable modifications are made 
to meet these requirements, before the meeting:
    (1) Parking. (i) Where parking is available on or adjacent to the 
site, one 12' wide space must be set aside for the care of each mobility 
impaired attendee. The space need not be permanently striped but may be 
temporarily marked by signs, ropes, or other means satisfactory to carry 
out this provision.
    (ii) Where parking is not available on or adjacent to the site, 
valet parking or other alternative means to assist a person who has a 
mobility impairment may be used. Alternate means must be satisfactory in 
the judgment of the Government project officer.
    (2) Entrances. (i) ``Entrances'' shall include at least one 
accessible entrance from the street/sidewalk level, and at least one 
accessible entrance from any available parking facility.
    (ii) The entrance shall be level or accessible by ramp with an 
incline that allows independent negotiation by a person in a wheelchair. 
In general, the slope of the incline shall be no more than 1'' rise per 
foot of ramp length (1:12).
    (iii) Entrance doorways shall be at least 30'' in clear width and 
capable of operation by persons with disabilities. Revolving doors, 
regardless of foldback capability, will not meet this requirement.
    (3) Meeting Rooms. (i) Meeting room access from the main entrance 
area must be level or at an independently negotiable incline 
(approximately 1:12) and/or served by elevators from the main entrance 
level. All elevators shall be capable of accommodating a wheelchair 29'' 
wide by 45'' long.
    (ii) Meeting rooms shall be on one level or, if on different levels, 
capable of being reached by elevators or by ramps that can be 
independently negotiated by a person in a wheelchair. Doorways to all 
meeting rooms shall be at least 30'' in clear width.
    (iii) The interior of the meeting room shall be on one level or 
ramped so as to be independently negotiable for a person in a 
wheelchair.
    (iv) Stages, speaker platforms, etc. which are to be used by persons 
in wheelchairs must be accessible by ramps or lifts. When used, the 
ramps may not necessarily be independently negotiable if space does not 
permit. However, any slope over 1:12 must be approved by the project 
officer. Each case is to be judged on its own merits.
    (v) If a meeting room with fixed seating is utilized, seating 
arrangements for persons in wheelchairs shall be made so that these 
persons are incorporated into the group rather than isolated on the 
perimeter of the group.
    (4) Restrooms. (i) Restrooms shall have level access, signs 
indicating accessibility, and doorways at least 30'' in clear width.
    (ii) Sufficient turning space within restrooms shall be provided for 
independent use by a person in a wheelchair 29'' wide by 45'' long. A 
space 60'' by 60'' or 63'' by 56'' of unobstructed floor space as 
measured 12'' above the floor is acceptable by standard; other layouts 
will be accepted if it can be demonstrated that they are usable as 
indicated.
    (iii) There will be a restroom for each sex or a unisex restroom 
with at least one toilet stall capable of accommodating a wheelchair 
29'' wide by 45'' long (by standard, the minimum is 3'-0'' by 4'-8'') 
with outswinging doors or privacy curtains. Wall mounted grab bars are 
required.
    (iv) When separate restrooms have been set up for mobility impaired 
persons, they shall be located adjacent to the regular restrooms and 
shall be fully accessible.
    (5) Eating Facilities. (i) Eating facilities in the meeting facility 
must be accessible under the same general guidelines as are applied to 
meeting rooms.
    (ii) If the eating facility is a cafeteria, the food service area 
(cafeteria line) must allow sufficient room for independent wheelchair 
movement and accessibility to food for persons in wheelchairs, and 
cafeteria staff shall be available to assist disabled persons.
    (6) Overnight Facilities. If overnight accommodations are required:
    (i) Sufficient accessible guest rooms to accommodate each attendee 
who is disabled shall be located in the facility where the meeting, 
conference, or seminar is held, or in a facility housing the attendees 
which is conveniently located nearby, whichever is satisfactory to the 
project officer.
    (ii) Overnight facilities shall provide for the same minimum 
accessiblity requirements as the facility utilized for the meeting, 
conference, or seminar. In addition, guest room access from the main 
entrance area shall be level, ramped at an independently negotiable 
incline (1:12), and/or served by elevators capable of accommodating a 
wheelchair 29'' wide by 45'' long.
    (iii) Doorways to guest rooms, including the doorway to the 
bathroom, shall be at least 30'' in clear width.
    (iv) Bathrooms shall have wall mounted grab bars at the tub and 
water closet.
    (v) Guest rooms for persons with a disability shall be provided at 
the same rate as a guest room for other attendees.

[[Page 136]]

    (7) Water Fountains. Water fountains shall be accessible to disabled 
persons, or have cup dispensers for use by persons in wheelchairs.
    (c) Provisions of Services for Sensory Impaired Attendees. (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 sensory impaired persons 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 sensory impaired persons 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 teletype number for the 
hearing impaired.
    (2) The Contractor shall provide, at no cost to the individual, 
those services required by persons with sensory impairments to insure 
their complete participation in the meeting, conference, or seminar.
    (3) As a minimum, when requested in advance, the Contractor shall 
provide the following services:
    (i) For hearing impaired persons, qualified interpreters. Provisions 
will also be made for volume controlled phone lines and, if necessary, 
transportation to local teletype equipment to enable hearing impaired 
individuals to receive and send meeting related calls. If local teletype 
equipment is not available, the Contractor shall provide on site 
teletype equipment. Also, the meeting rooms will be adequately 
illuminated so signing by interpreters can be easily seen.
    (ii) For vision impaired persons, 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 the visually and hearing impaired. Readers, 
braille translations, and/or tape recordings are all acceptable. These 
materials shall be available to sensory impaired individuals upon their 
arrival.
    (4) The Contractor is responsible for making every effort to 
ascertain the number of sensory impaired individuals who plan to attend 
the meeting, conference, or seminar. However, if it can be determined 
that there will be no sensory impaired person (deaf and/or blind) in 
attendance, the provision of those services under paragraph (c) for the 
nonrepresented group, or groups, is not required.

                             (End of clause)



352.270-2  Indian preference.

    The following clause shall be used 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 
business concerns owned and controlled by socially and economically 
disadvantaged individuals, or labor surplus area 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 that Tribe.
    (2) ``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

[[Page 137]]

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), 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)



352.270-3  Indian preference program.

    The following clause shall be used as prescribed in 370.202(b):

                  Indian Preference Program (Apr 1984)

    (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 perference 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 (i) Maintain liaison with 
the Government and the Tribe(s) on Indian perference matters; (ii) 
Supervise compliance with the provisions of this clause; and (iii) 
Administer the Contractor's Indian perference 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 representation 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 
orgnizations 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

[[Page 138]]

contract. If one or more responsive 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, and the total number of Indians 
employed under this contract; (iii) 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; 
(iv) Actions taken to give preference to Indian organizations and 
Indian-owned economic enterprises for subcontracting opportunities which 
exist under this contract; (v) Reasons why preference was not given to 
Indian firms as subcontracators 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 (vi) 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 until expiration of one (1) 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 workday.
    (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)



352.270-4  Pricing of adjustments.

    Insert the following clause in all solicitations and resultant 
fixed-priced contracts other than purchase orders.

                    Pricing of Adjustments (Apr 1984)

    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 Acquisition  Commercial.                
 Regulation.                                                            
(b) Subpart 31.3 of the Federal Acquisition  Education.                 
 Regulation.                                                            
(c) Subpart 31.6 of the Federal Acquisition  State or local governments.
 Regulation.                                                            
(d) 45 CFR Part 74 Appendix E..............  Hospitals.                 
(e) Subpart 31.7 of the Federal Acquisition  Other nonprofit            
 Regulation.                                  institutions.             
------------------------------------------------------------------------

                             (End of clause)

[49 FR 14031, Apr. 9, 1984, as amended at 50 FR 38005, Sept. 19, 1985]



352.270-5  Key personnel.

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

[[Page 139]]

                        Key Personnel (Apr 1984)

    The personnel specified in this contract are considered to be 
essential to the work being performed hereunder. Prior to diverting any 
of the specified individuals to other programs, the Contractor shall 
notify the Contracting Officer reasonably in advance and shall submit 
justification (including proposed substitutions) in sufficient detail to 
permit evaluation of the impact on the program. No diversion shall be 
made by the Contractor without the written consent of the Contracting 
Officer; Provided, that the Contracting Officer may ratify in writing 
such diversion and such ratification shall constitute the consent of the 
Contracting Officer required by the clause. The contract may be amended 
from time to time during the course of the contract to either add or 
delete personnel, as appropriate.

                             (End of clause)



352.270-6  Publication and publicity.

    Insert the following clause in all solicitations and resultant 
contracts.

                  Publications and Publicity (Jul 1991)

    (a) Unless otherwise specified in this contract, 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 content of this publication does not necessarily reflect the 
views or policies of the Department of Health and Human Services, nor 
does mention of trade names, commercial products, or organizations imply 
endorsement by the U.S. Government.

                             (End of Clause)

[56 FR 33882, July 24, 1991, as amended at 56 FR 57602, Nov. 13, 1991]



352.270-7  Paperwork Reduction Act.

    Insert the following clause in all solicitations and contracts.

                   Paperwork Reduction Act (Apr 1984)

    (a) In the event that it subsequently becomes a contractual 
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, the Paperwork Reduction Act of 1980 (Pub. 
L. 96-511) 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 Assistant Secretary for Management and Budget (ASMB) 
within the Department of Health and Human Services (HHS) and 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 ASMB and OMB clearance.
    (b) The Contractor shall obtain the required ASMB and OMB clearance 
through the Project Officer before expending any funds or making public 
contacts for the collection of data. The authority to expend funds and 
proceed with the collection of information shall be in writing by the 
Contracting Officer. The Contractor must plan at least 120 days for ASMB 
and OMB clearance. Excessive delay caused by the Government which arises 
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)



PART 353--FORMS--Table of Contents




                  Subpart 353.3--Illustrations of Forms

Sec.
353.370-393  Form HHS 393, Purchase/Service/Stock Requisition.
353.370-674  Form HHS 674, Structured Approach Profit/Fee Objective.

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



                  Subpart 353.3--Illustrations of Forms

[[Page 140]]

353.370-393    Form HHS 393, Purchase/Service/Stock Requisition.
[GRAPHIC] [TIFF OMITTED] TC01MR91.124

[51 FR 44295, Dec. 9, 1986]

[[Page 141]]

353.370-674    Form HHS 674, Structured Approach Profit/Fee Objective.
[GRAPHIC] [TIFF OMITTED] TC01MR91.125

[49 FR 14047, Apr. 9, 1984]

[[Page 142]]



                   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.

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

    Source:  49 FR 14048, Apr. 9, 1984, 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 individuals with disabilities. For the 
purposes 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, shall consult with the Office of Engineering 
Services serving the region where the meeting, conference, or seminar is 
to be held, to assure that the contractor's plan meets the accessibility 
requirements of the contract clause. The Office of Engineering Services 
shall make a determination on the adequacy of the contractor's plan, and 
notify the project officer, in writing, within ten (10) working days of 
receiving the request from the project officer.
[49 FR 14048, Apr. 9, 1984, as amended at 50 FR 23135, May 31, 1985; 50 
FR 38004, Sept. 19, 1985]



     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
    (2) 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).

[[Page 143]]



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, 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 that 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 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 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.
    (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

[[Page 144]]

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 noncompliance 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 
Business and Administrative 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 ensure uniform understanding of the additional requirements 
by all prospective bidders or offerors.
    (b) Nothing in these regulations 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) above, 
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.

[[Page 145]]


            Attachment I to Chapter 3--Single Letter of Credit Recipients and Central Point Addresses           
----------------------------------------------------------------------------------------------------------------
                                                                                                       Letter of
         State                 Organization and payee No.               Recipient CRS-EIN \1\           credit  
----------------------------------------------------------------------------------------------------------------
Alabama................  University of Alabama Medical Center,  1-636001138-A2, 1-636001138-A3, 1-     750080110
                          1-636005396-A4.                        636001138-A4, 1-636001138-A5,.                 
                         Director, Office of Grants and         1-636001138-B1, 1-636005396-A3 1-     ..........
                          Contracts Accounting, University of    636005396-A4, 1-636005396-A5, 1-               
                          Alabama, University Station,           636005396-A6, 1-636005396-A7, 1-               
                          Birmingham, Alabama 35296.             636005396-A8.                                  
                         University of Alabama, 1-636001138-A1  1-636001138-A1, 1-636001138-A6......    75080115
                         Comptroller, University of Alabama,    1-636001138-A7, 1-636001138-A8, 1-    ..........
                          P.O. Box M, University, Alabama.       636001138-A9, 1-636001138-B2, 1-               
                                                                 636001138-B3, 1-636001138-B4.                  
                         Southern Research, Institute, 1-       1-630288868-A1, 1-630288868-A2......    75083532
                          630288868-A2.                                                                         
                         Financial Officer, Southern Research   ....................................  ..........
                          Institute, 2000 9th Avenue, South,                                                    
                          Birmingham, Alabama 35205.                                                            
Alaska.................  State of Alaska, 1-900001517-A1......  1-000700389-A1, 1-926001185-A2, 1-      75080021
                                                                 926001185-A3.                                  
                         Director, Division of Finance,         1-926001185-A4, 1-926001185-A5, 1-    ..........
                          Department of Administration, Pouch    926001185-A7, 1-926001185-B1, 1-               
                          C, Juneau, Alaska 99801.               926001185-B2, 1-926001185-B3, 1-               
                                                                 926001185-B6, 1-926001185-B7, 1-               
                                                                 926001185-B8, 1-926001185-B9, 1-               
                                                                 926001185-C1, 1-926001185-C2.                  
Arizona................                                                                                         
                         State of Arizona, 1-866004791-B7.....  1-866004791-A1, 1-866004791-A2, 1-      75080628
                                                                 866004791-A3,                                  
                         State Treasurer's Office, State        1-866004791-A4, 1-866004791-A5, 1-    ..........
                          Capitol, Phoenix, Arizona, 85007.      866004791-A6, 1-866004791-A7, 1-               
                                                                 866004791-A8, 1-866004791-A9, 1-               
                                                                 866004791-B2, 1-866004791-B3, 1-               
                                                                 866004791-B7, 1-866004791-B8, 1-               
                                                                 866004791-C2, 1-866004791-C5, 1-               
                                                                 866004791-C7, 1-866004791-C8, 1-               
                                                                 866004791-C9, 1-866004791-D1, 1-               
                                                                 866004791-D2, 1-866004791-D3, 1-               
                                                                 866004791-D5, 1-866004791-D6, 1-               
                                                                 866004791-D7, 1-866004791-D8, 1-               
                                                                 866004791-D9, 1-866004791-E3, 1-               
                                                                 866004791-E5, 1-866004791-E6, 1-               
                                                                 866004791-E7, 1-866004791-E8, 1-               
                                                                 866004791-E9.                                  
California.............  County of San Diego, 1-95000934-A2...  1-956000924-A1 1-956000924-A2.......    75080386
                         Auditor and Controller, County of San  ....................................  ..........
                          Diego, County Administration Center,                                                  
                          1600 Pacific Highway, San Diego,                                                      
                          California 92101.                                                                     
                         University of California, 1-900001727- ....................................    75081471
                          A1.                                                                                   
                         Letter of Credit, Universities of      ....................................  ..........
                          California, Berkeley, California                                                      
                          94720.                                                                                
                         Santa Barbara........................  1-956006145-A1 1-956006145-A2.......    75081471
                         San Diego............................  1-956006144-A1, 1-956006144-A2, 1-      75081471
                                                                 956006144-A3.                                  
                         Davis................................  1-946036494-A1......................    75081471
                         Los Angeles..........................  1-956006143-A1, 1-956006143-A2, 1-      75081471
                                                                 956006143-A3, 1-956006143-A4, 1-               
                                                                 956006143-A6.                                  
                         Irvine...............................  1-952226406-A1, 1-952226406-A2......    75081471
                         Berkeley.............................  1-946002133-A1, 1-946002133-A2......    75081471
                         Riverside............................  1-237361894-A1, 1-956006142-A1......    75081471
                         Santa Cruz...........................  1-941539563-A1......................    75081471
                         San Francisco........................  1-946036493-A1, 1-946036493-A6, 1-      75081471
                                                                 946036493-A7, 1-946036493-A8.                  
                         Los Alamos Lab.......................  1-856004458-A1......................    75081471
                         Lawrence Livermore Lab...............  1-946031193-A1......................    75081471
                         Scripps Clinic and Res. Fndn.........  1-951684089-A1......................    75087560
                         Comptroller, Scripps Clinic and Res.   ....................................  ..........
                          Fndn. 476 Prospect Street, La Jolla,                                                  
                          California 92037.                                                                     
Connecticut............  Yale University, 1-060646973-A1......  1-060646973-A1, 1-060646973-A2, 1-      75089755
                                                                 060646973-A4.                                  

[[Page 146]]

                                                                                                                
                         Treasurer, Yale University, Grants     1-060646973-A5, 1-060646973-A6, 1-    ..........
                          and Contracts, 155 Whitney Avenue,     060646973-A7, 1-060646973-A8.                  
                          New Haven, Conn. 05611.                                                               
District of Columbia...  Georgetown University, 1-530196603-A1  1-530196603-A1, 1-530196603-A2, 1-      75083450
                                                                 530196603-A3.                                  
                         Treasurer, Georgetown University,      1-530196603-A4, 1-530196603-A5, 1-    ..........
                          37th and O Streets NW., Washington,    530196603-A6, 1-530196603-A7.                  
                          D.C. 20007.                                                                           
                         George Washington University, 1-       1-530196584-A1, 1-530196584-A3......    75083441
                          530196584-A1.                                                                         
                         Treasurer, George Washington           ....................................  ..........
                          University, Rice Hall, Washington,                                                    
                          D.C. 20006.                                                                           
                         Gorgas Memorial Institute, 1-          1-530196518-A1......................    75083522
                          530196518-A1.                                                                         
                         Treasurer, Gorgas Memorial Institute,  ....................................  ..........
                          2007 I Street NW., Washington, D.C.                                                   
                          20007.                                                                                
                         National Academy of Sciences, 1-       1-530196932-A1, 1-530196932-A2......    75085992
                          530196932-A1.                                                                         
                         Treasurer, National Academy of         ....................................  ..........
                          Sciences, 2101 Constitution, Avenue                                                   
                          NW., Washington, D.C. 20037.                                                          
Florida................  University of Florida, 1-596001874-    1-596001874-C7, 1-596001874-F2......    75083326
                          C7, Fiscal Contract Officer,                                                          
                          University of Florida, Room 106, R.                                                   
                          Johnson Hall, Gainesville, Florida                                                    
                          32611.                                                                                
                         University of Miami, 1-590624458-A1..  1-590624458-A1, 1-590624458-A2, 1-      75085253
                                                                 590624458-A3.                                  
                         Chief Accountant, University of        1-590624458-A6......................  ..........
                          Miami, P.O. Box 9057, Coral Gables,                                                   
                          Florida 33124.                                                                        
Georgia................  State of Georgia, 1-581130678-Al.....  1-580973190-A2, 1-581130678-A1, 1-      75083462
                                                                 581130678-A5,.                                 
                         Director, Department of Adm.           1-581130678-A6, 1-586000246-A2, 1-              
                          Services, Fiscal Division, Pryor-      586002042-A1, 1-586002042-A2, 1-               
                          Mitchell Building, Atlanta, Georgia    586002042-A3, 1-586002042-A4, 1-               
                          30334.                                 586002042-A6, 1-900000257-A1, 1-               
                                                                 900000648-A1.                                  
Guam...................  Territory of Guam, 1-980018947-E6....  1-000040215-A1, 1-000040218-A1, 1-      7508B368
                                                                 000040228-A1.                                  
                         Department of Administration, P.O.     1-000040238-A1,1-000307495-A1,1-0003  ..........
                          Box 884, Government of Guam, Agana,    13462-A1,1-900000270-A1,1-900000273            
                          Guam 96110.                            -A1,1-900000274-A1,1-980018947-A1,1            
                                                                 -980018947-A2,1-980018947-A3,1-9800            
                                                                 18947-A4,1-980018947-A7,1-980018947            
                                                                 -A8,1-980018947-A9,1-980018947-B1,1            
                                                                 -980018947-B2,1-980018947-B3,1-9800            
                                                                 18947-B5,1-980018947-D1,1-980018947            
                                                                 -E5,1-980018947-E7,1-980018947-F1.             
Illinois...............  University of Illinois Medical         1-376000511-A1,1-376000511-A3,1-3760    75083885
                          Center, 1-376000511-A5.                00511-A5,1-376000511-A8.                       
                         Business Manager, University of        01-376000511-A9,1-376000511-B2,1-376            
                          Illinois, Chicago, Illinois, P.O.      000511-B4,1-376000511-B5,1-37600051            
                          Box 6998, Chicago, Illinois 60680.     1-C1,1-376000511-C2,1-376000511-C3.            
Kansas.................  Kansas State University 1-480771751-   1-480771751-A1,1-480771751-A2.......    75084200
                          A1, Comptroller, Kansas State,                                                        
                          University of Agriculture . Applied                                                   
                          Sciences, Anderson Hall, Manhattan,                                                   
                          Kansas 66502.                                                                         
Louisiana..............  State of Louisiana, 1-900001516-A1,..  1-000014399-A1,1-000014607-A1,1-2372    75080020
                                                                 08290-A1.                                      

[[Page 147]]

                                                                                                                
                         Assistant State Treasurer, State       1-237208290-A2,1-720591509-A1,1-7206            
                          Treasurer's Office, P.O. Box 44154,    37038-A1,1-720637038-A2,1-720645546            
                          Capital Station, Baton Rouge,          -A1,1-720650883-A1,1-720695435-A1,1            
                          Louisiana 70804.                       -720707278-A1,1-726000720-A1,1-7260            
                                                                 00733-A1,1-726000734-A1,1-726000734            
                                                                 -A2,1-726000734-A3,1-726000743-A1,1            
                                                                 -726000745-A1,1-726000756-A1,1-7260            
                                                                 00766-A1,1-726000800-A1,1-726000800            
                                                                 -A2,1-726000813-A1,1-726000821-A1,1            
                                                                 -726000821-A2,1-726000821-A3,1-7260            
                                                                 00821-A4,1-726000821-A5,1-726000826            
                                                                 -A1,1-726001901-A1,1-726011595-A1,1            
                                                                 -726011595-A3,1-726011595-A5,1-7260            
                                                                 11595-A6,1-726011595-A8,1-726011595            
                                                                 -A9,1-726012498-A1,1-726014571-A1,1            
                                                                 -726101595-A1,1-900001256-A1,1-9000            
                                                                 01342-A1,1-900002575-A1.                       
Maine..................  Jackson Laboratories, 1-010211513-A1.  1-01211513-A1.......................    75087315
                         Financial Officer, The Jackson                                                         
                          Laboratories, Otter Creek Road, Bar                                                   
                          Harbor, Maine 04609.                                                                  
Massachusetts..........  Boston University, 1-042103547-A1....  1-042103547-A1, 1-042103547-A2, 1-      75081272
                                                                 042103547-A4.                                  
                         Comptroller, Boston University, 755                                                    
                          Commonwealth Avenue, Boston, Mass.                                                    
                          02215.                                                                                
                         Forsyth Dental Center, 1-042104230-A2  1-042104230-A1, 1-042104230-A2......    75083375
                         Assistant Treasurer, Forsyth Dental                                                    
                          Center, 140 Fenway, Boston, Mass.                                                     
                          02115.                                                                                
                         Harvard University 1-042103580-B1....  1-042103580-A2, 1-042103580-A3, 1-      75083630
                                                                 042103580-A4.                                  
                         Office of the Comptroller............  1-042103580-A5, 1-042103580-A6......            
                         President & Fellows of Harvard         1-042103580-A7, 1-042103580-A8, 1-    ..........
                          College Cambridge, Mass. 02138.        042103580-A9, 1-042103580-B1.                  
                         Massachusetts General Hospital, 1-     1-041564300-A1, 1-041564655-A3, 1-      75084810
                          041564655-A4.                          041564655-A4.                                  
                         Treasurer, Massachusetts General       1-041564655-A5......................  ..........
                          Hospital, 45 Milk Street, Boston,                                                     
                          Mass. 02114.                                                                          
                         Massachusetts Institute of             1-042103594-A1, 1-042103594-A2......    75084836
                          Technology, 1-042103594-A1.                                                           
                         Fiscal Officer, Division of Sponsored  ....................................  ..........
                          Research, Massachusetts Institute of                                                  
                          Technology, Cambridge, Mass. 02139.                                                   
                         Worcester Foundation, 1-042121658-A1.  1-042121658-A1......................    75089680
                         Finance Officer, Worcester Foundation  ....................................  ..........
                          for Experimental Biology, Inc., 222                                                   
                          Maple Avenue, Shrewsbury,                                                             
                          Massachusetts 01545.                                                                  
Maryland...............  Johns Hopkins University, 1-520595110- 1-000701501-A1, 1-520595110-A1, 1-      75084130
                          A5, University Budget Officer Johns    520595110-A2, 1-520595110-A3, 1-               
                          Hopkins University, Garland Hall, Rm   520595110-A4, 1-520595110-A5.                  
                          327, Charles and 34th Streets,                                                        
                          Baltimore, Md. 21218.                                                                 
Michigan  .............  University of Michigan, 1-386006309-   1-386006309-A1, 1-386006309-A2, 1-      75085301
                          A1.                                    386006309-A3.                                  
                         University Cashier, Regents of the     1-386006309-A4, 1-386006309-A5, 1-    ..........
                          University of Michigan, 1015 L.S. &    386006309-A6, 1-386006309-A7, 1-               
                          A. Bldg., Ann Arbor, Michigan 48104.   386006309-A8, 1-386006309-A9, 1-               
                                                                 386006309-B1,1-386006309-B2.                   
Minnesota  ............  Mayo Foundation, 1-416011702-A1......  1-4160011702-A1, 1-4160011702-A2....    75084875
                         Treasurer, Mayo Foundation, 200 First  ....................................  ..........
                          Street, SW., Rochester, Minnesota                                                     
                          55901.                                                                                
                         University of Minnesota, 1-416007513-  1-416007513-A1, 1-416007513-A2, 1-      75085448
                          A5.                                    416007513-A3.                                  
                         Director, Research Administration,     1-416007513-A5, 1-416007513-A8, 1-    ..........
                          105 Admin. Servs. Building, 2610       416007513-B2, 1-416007513-B3, 1-               
                          University Avenue, St. Paul,           416007513-B4, 1-416007513-B5, 1-               
                          Minnesota 55114.                       416007513-B7.                                  
Missouri  .............  Midwest Research Institute, 1-         1-440545878-A1......................    75085361
                          440545878-A1.                                                                         
                         Treasurer, Midwest Research            ....................................  ..........
                          Institute, 425 Volker Blvd., Kansas                                                   
                          City, Missouri 64110.                                                                 
Nebraska  .............  State of Nebraska, 1-470491233-C5....  1-000021900-A1, 1-210674761-A1, 1-      75086320
                                                                 470491233-A1.                                  

[[Page 148]]

                                                                                                                
                         State of Nebraska Accounting Dept.,    1-470491233-A3, 1-470491233-A4, 1-    ..........
                          Administrative Services Office,        470491233-A6, 1-470491233-A7, 1-               
                          State Capitol Bldg., Lincoln,          470491233-A8, 1-470491233-A9, 1-               
                          Nebraska 68509.                        470491233-B1, 1-470491233-B2, 1-               
                                                                 470491233-B3, 1-470491233-B4, 1-               
                                                                 470491233-B5, 1-470491233-B6, 1-               
                                                                 470491233-B7, 1-470491233-B8, 1-               
                                                                 470491233-B9, 1-470491233-C1, 1-               
                                                                 470491233-C2, 1-470491233-C3, 1-               
                                                                 470491233-C4, 1-470491233-C5, 1-               
                                                                 470491233-C6, 1-470491233-C7, 1-               
                                                                 470491233-C8, 1-470491233-C9, 1-               
                                                                 470491233-D1, 1-470491233-D2, 1-               
                                                                 470491233-D4, 1-476000479-A1, 1-               
                                                                 476000535-A1, 1-476000535-A8, 1-               
                                                                 741699874-A1, 1-900001910-A1, 1-               
                                                                 900001919-A1, 1-900002209-A1, 1-               
                                                                 900002333-A1, 1-900003427-A1, 1-               
                                                                 900003437-A1.                                  
New York...............  Adelphi University, 1-111630741-A1...  1-111630741-A1......................    75080040
                         Business Manager, Adelphi University,  ....................................  ..........
                          South Avenue, Garden City, New York                                                   
                          11530.                                                                                
                         Albany Medical Center, 1-141338310-    1-141338310-A1......................    75080150
                          A1,.                                                                                  
                         Assistant Treasurer, Albany Medical    ....................................  ..........
                          College of Union University, 47 New                                                   
                          Scotland Avenue, Albany, New York                                                     
                          12208.                                                                                
                         Children's Hospital of Buffalo, 1-     1-160748423-A1......................    75082160
                          160748423-A1.                                                                         
                         Comptroller, Children's Hospital of    ....................................  ..........
                          Buffalo, 219 Bryant Street, Buffalo,                                                  
                          N.Y. 14222.                                                                           
                         New York Medical College, 1-131099420- 1-131099420-A1......................    75086270
                          A1.                                                                                   
                         Treasurer, New York Medical College,   ....................................  ..........
                          Flower/Fifth Avenue Hospitals, 1                                                      
                          East 105th Street, New York, N.Y.                                                     
                          10029.                                                                                
                         New York University, 1-135562308-A1..  1-135562308-A1, 1-135562308-A3, 1-      75086330
                                                                 135562308-A4.                                  
                         Assistant Controller, New York         1-135562308-A5, 1-135562308-A6......  ..........
                          University, 500 Kimball Hall,                                                         
                          Washington Square, New York, New                                                      
                          York 10003.                                                                           
                         New York University Medical Center, 1- 1-135562308-A2, 1-135562308-B1, 1-      75086333
                          135562309-A1.                          135562309-A1, 1-135562309-A2.                  
                         Comptroller, New York University       1-135562309-A3, 1-229124053-A1......  ..........
                          Medical Center, 550 First Avenue,                                                     
                          New York, New York 10016.                                                             
                         University of Rochester, 1-160743209-  1-160743209-A1, 1-160743209-A2, 1-       7508272
                          A1, Research Accountant University     160743209-A3, 1-160743209-A4, 1-               
                          of Rochester, River Campus,            160743209-A5.                                  
                          Rochester, New York 14627.                                                            
                         Research Foundation of the State,      1-131819472-A1, 1-132633612-A1, 1-      75087210
                          University of New York, 1-14136861-    141363361-A1, 1-141368361-A1, 1-               
                          J3, Comptroller, Research Foundation   141368361-A2, 1-141368361-J3, 1-               
                          of State University of New York,       146013200-E4, 1-146013200-E5, 1-               
                          P.O. Box 7126, Albany, New York        146013200-E6, 1-146013200-E7, 1-               
                          12224.                                 146013200-E8, 1-146013200-E9, 1-               
                                                                 146013200-F1, 1-146013200-F2, 1-               
                                                                 146013200-F3, 1-146013200-F4, 1-               
                                                                 146013200-F5, 1-146013200-F6, 1-               
                                                                 146013200-F7, 1-146013200-F8, 1-               
                                                                 146013200-F9, 1-146013200-G1, 1-               
                                                                 146013200-G2, 1-146013200-G3, 1-               
                                                                 146013200-G4, 1-146013200-G5, 1-               
                                                                 146013200-G6, 1-146013200-G7, 1-               
                                                                 146013200-G8, 1-146013200-G9, 1-               
                                                                 146013200-H1, 1-146013200-H2, 1-               
                                                                 146013200-H3, 1-146013200-H4, 1-               
                                                                 146013200-J3, 1-146013200-K4, 1-               
                                                                 146013200-L5, 1-146013200-L6, 1-               
                                                                 146013200-L7.                                  
                         Research Foundation of the City,       1-131988190-A1, 1-131988190-A8......    75082337
                          University of New York, 1-131988190-                                                  
                          A1.                                                                                   
                         Treasurer, Research Foundation of the  ....................................  ..........
                          City, University of New York, 1411                                                    
                          Broadway, New York, New York 10018.                                                   
                         State of New York, 1-146013200-J7....  1-146013200-A1, 1-146013200-A2, 1-      75086340
                                                                 146013200-A3.                                  

[[Page 149]]

                                                                                                                
                         Director, State Accounts, Alfred E.    1-146013200-A4, 1-146013200-A5, 1-              
                          Smith, Building, Albany, New York      146013200-A6, 1-146013200-A7, 1-               
                          12225.                                 146013200-A8, 1-146013200-A9, 1-               
                                                                 146013200-B1, 1-146013200-B2, 1-               
                                                                 146013200-B3, 1-146013200-B4, 1-               
                                                                 146013200-B5, 1-146013200-B6, 1-               
                                                                 146013200-B7, 1-146013200-B8, 1-               
                                                                 146013200-B9, 1-146013200-C1, 1-               
                                                                 146013200-C2, 1-146013200-C3, 1-               
                                                                 146013200-C4, 1-146013200-C5, 1-               
                                                                 146013200-C6, 1-146013200-C8, 1-               
                                                                 146013200-C9, 1-146013200-D1, 1-               
                                                                 146013200-D2, 1-146013200-D3, 1-               
                                                                 146013200-D4, 1-146013200-D5, 1-               
                                                                 146013200-D6, 1-146013200-D7, 1-               
                                                                 146013200-D9, 1-146013200-E1, 1-               
                                                                 146013200-E2, 1-146013200-E3, 1-               
                                                                 146013200-H5, 1-146013200-H6, 1-               
                                                                 146013200-H7, 1-146013200-H8, 1-               
                                                                 146013200-H9, 1-146013200-I1, 1-               
                                                                 146013200-I2, 1-146013200-I3, 1-               
                                                                 146013200-I4, 1-146013200-I7, 1-               
                                                                 146013200-I8, 1-146013200-J1, 1-               
                                                                 146013200-J4, 1-146013200-J5, 1-               
                                                                 146013200-J6, 1-146013200-J7, 1-               
                                                                 146013200-J8, 1-146013200-J9, 1-               
                                                                 146013200-K1, 1-146013200-K2, 1-               
                                                                 146013200-K3, 1-146013200-K6, 1-               
                                                                 146013200-K7, 1-146013200-K9, 1-               
                                                                 146013200-L3, 1-146013200-L4, 1-               
                                                                 146013200-L8.                                  
Ohio...................  Case Western Reserve University, 1-    1-341018992-A4, 1-341018992-A1, 1-      75089472
                          341018992-A1.                          341018992-A2.                                  
                         Comptroller Case Western Reserve       ....................................  ..........
                          University, 2040 Adelbert Road,                                                       
                          Cleveland, Ohio 44106.                                                                
Tennessee..............  St. Jude's Children's Research         1-62646012-A1.......................    75083427
                          Hospital, 1-620646012-A1.                                                             
                         Treasurer, St. Jude's Children's       ....................................  ..........
                          Hospital, 332 N. Lauderdale,                                                          
                          Memphis, Tennessee 38101.                                                             
Texas..................  Baylor University College of           1-741613878-A1, 1-741613878-A2......    75081070
                          Medicine, 1-741613878-A2.                                                             
                         Business Manager, Baylor College of    ....................................  ..........
                          Medicine, 1200 Moursund Ave.,                                                         
                          Houston, Texas 77025.                                                                 
                         University of Texas at Houston Health  1-741761309-A4, 1-741761309-A6......    75088056
                          Center, 1-741761309-A4.                                                               
                         Associate Dean for Business Affairs,   ....................................  ..........
                          University of Texas, Medical School,                                                  
                          P.O. Box 20036 Houston, Texas 77025.                                                  
                         University of Texas Medical School, 1- 1-756002868-A3, 1-756002868-A4, 1-      75088130
                          756002868-A4.                          756002868-A5.                                  
                         Business Manager, University of        ....................................  ..........
                          Texas, Southwestern Medical Schools,                                                  
                          5323 Harry Hines Blvd., Dallas, Tex                                                   
                          75235.                                                                                
                         University of Texas, M.D. Anderson     1746001118-A1.......................    75088910
                          Hospital, 1-746001118-A1.                                                             
                         Supervisor, Grant Reporting, M.D.      ....................................  ..........
                          Anderson Hospital, University of                                                      
                          Texas, 6723 Bertner Ave., Houston,                                                    
                          Texas 77025.                                                                          
                         University of Texas Medical Branch,    1-74600949-A1.......................    75088916
                          Galveston, Texas, 1-74600949-A1.                                                      
                         Business Manager, University of        ....................................  ..........
                          Texas, Medical Branch, 1000 Strand,                                                   
                          Galveston, Texas 77550.                                                               
Utah...................  University of Utah and University of   1-876000525-A1, 1-876000525-A2, 1-      75089067
                          Utah Research 1-876000525-A6.          876000525-A3, 1-876000525-A6, 1-               
                                                                 876000525-A7,.                                 
                         Controller, University of Utah, 122    1-876000525-A8......................  ..........
                          Park Building, Salt Lake City, Utah                                                   
                          84112.                                                                                
Washington.............  University of Washington, 1-916001537- 1-916001537-A1, 1-916001537-A2, 1-      75089320
                          A5, Director, Office of Grant/         916001537-A4, 1-916001537-A5, 1-               
                          Contract Services, University of       916001537-A6, 1-916001537-A9.                  
                          Washington, 211 Administration                                                        
                          Building, Seattle, Washington 98195.                                                  
Wisconsin..............  State of Wisconsin, 1-396006469-B1...  1-000039594-A1, 1-000702000-A1, 1-      7508H610
                                                                 390808464-A1.                                  

[[Page 150]]

                                                                                                                
                         Budget Operations, State Budget        1-391051231-A1, 1-396006436-A1, 1-              
                          Office, One West Wilson St., Madison   396006443-A3, 1-396006447-A1, 1-               
                          Wisconsin 53607.                       396006461-A1, 1-396006461-A2, 1-               
                                                                 396006461-A3, 1-396006461-A4, 1-               
                                                                 396006461-A5, 1-396006461-A6, 1-               
                                                                 396006461-A7, 1-396006461-A8, 1-               
                                                                 396006461-A9, 1-396006461-B1, 1-               
                                                                 396006466-A1, 1-396006469-A1, 1-               
                                                                 396006469-A5, 1-396006469-A6, 1-               
                                                                 396006469-A7, 1-396006469-B1, 1-               
                                                                 396006469-B5, 1-396006487-A1, 1-               
                                                                 396006487-A2, 1-396006488-A1, 1-               
                                                                 396006492-A1, 1-396006492-A2, 1-               
                                                                 396006492-A3, 1-396006492-A5, 1-               
                                                                 396006492-A6, 1-396006492-A7, 1-               
                                                                 396006492-A8, 1-396006492-B1, 1-               
                                                                 396006492-B2, 1-396006492-B3, 1-               
                                                                 396006492-B4, 1-396006492-B5, 1-               
                                                                 396006492-B6, 1-396006492-B7, 1-               
                                                                 396006492-B8, 1-396006492-B9, 1-               
                                                                 396006492-C1, 1-396006492-C2, 1-               
                                                                 396006492-C3, 1-396006492-C4, 1-               
                                                                 396006492-C5, 1-396006492-C6, 1-               
                                                                 396006492-C7, 1-396006492-C8, 1-               
                                                                 396006492-C9, 1-396006492-D1, 1-               
                                                                 396028867-A1, 1-396028867-A2, 1-               
                                                                 396091677-A1, 1-396091677-A2, 1-               
                                                                 396320507-A1, 1-900000022-A1, 1-               
                                                                 900002012-A1, 1-900002564-A1, 1-               
                                                                 900002665-A1, 1-900003134-A1.                  
----------------------------------------------------------------------------------------------------------------
\1\ Central Registry-System Entity Identification Number (CRS-EIN).                                             
CRS-EIN is a twelve digit number used to identify a recipient organization/individual in the HHS Central        
  Registry System (CRS). This system utilizes a standard identification number within HHS to identify recipients
  of Federal assistance-like programs. The first digit identifies whether the recipient is an organization (1)  
  or individual (2). The next nine (9) digits uniquely associate the organization/individual to an Employer     
  Identification Number assigned by the Internal Revenue Service in the case of an organization, or a Social    
  Security Number assigned by the Social Security Administration in the case of an individual. A two character  
  suffix code is assigned by the Central Registry System, HHS, to identify component levels within the recipient
  organization, such as: School of Medicine, Research Division, Department of Biology, etc. A suffix is not     
  applied to a Social Security Number since that number is unique to each individual.                           
                                                                                                                
[49 FR 14049, Apr. 9, 1984. Redesignated at 49 FR 36110, Sept. 14, 1984]                                        


[[Page 151]]

                   ATTACHMENT II--HHSAR SUBJECT INDEX

Editorial Note: This listing is provided for information purposes only. 
It is compiled and kept up-to-date by the Department of Health and Human 
Services.

``A-76''................................................................

307.3

Accessibility of Meetings, Conferences, and Seminars to Persons with 
Disabilities............................................................

370.1

Acquisition Planning....................................................

307.1
Contents of.............................................................
307.105

Administration of HHSAR.................................................

301.201

Administration, Post-Award Contract.....................................

342.70

ADP Review and Clearance................................................

339.7001

ADP Systems Security....................................................

339.7002

Advance Acquisition Planning (Scheduling)...............................

307.71

Advance Payments........................................................

332.4

Advertisements, Paid....................................................

305.5

Advocates for Competition...............................................

306.5

Agency Acquisition Regulations..........................................

301.3

Agency Head.............................................................

302.1

Amendments to Solicitations.............................................

315.410

Announcement of Contract Award..........................................

305.303

Antitrust Violations....................................................

303.303

Appeals, Disputes and...................................................

333.2

Appointment of Contracting Officers.....................................

301.603

Arrangement of Regulation...............................................

301.104-2

Audiovisual Materials, Acquisition Clearance of.........................

307.105-2(a)(14)

Audit, Closing Completed Contracts......................................

304.804-1

Award Instrument, Selection of..........................................

307.70

Balance of Payments Program.............................................

325.302

Basic Agreements........................................................

316.702

Basic Agreements, Numbering of..........................................

304.7004

Basic Ordering Agreements, Numbering of.................................

304.7005

Best and Final Offers...................................................

315.611

Blanket Purchase Agreements.............................................

313.2

Business Proposal Instructions..........................................

315.406-5(b)(3)

Buy American Act........................................................

325.1
Excepted Articles, Materials, Supplies..................................
325.108
Formats for Nonavailability Determinations..............................
325.108-70

Certifications, Representations and.....................................

315.406-5

Chief of Contracting Office.............................................

302.100

Class Determinations and Findings.......................................

301.703

Class Deviation.........................................................

301.404

Clauses, Special Contract...............................................

352.2

Closing Completed Contracts.............................................

304.804

Closing Review (of Contracts)...........................................

304.870

Coding of HHSAR.........................................................

301.104-1

Competition Advocates...................................................

306.5

Competition Requirements................................................

306

Competitive Range.......................................................

315.609

Completion (Work Statement).............................................

307.105-3

Confidentiality of Information..........................................

324.70

Considerations in Selecting an Award Instrument.........................

307.70

[[Page 152]]

Consolidated Acquisitions...............................................

317.70

Consulting Services.....................................................

337.2

Contingent Fee Violations...............................................

303.409
Contract Awards:
Announcement of.........................................................
305.303
Review and Approval of Proposed.........................................
304.71

Contract Clauses........................................................

352.2

Contract Closeout.......................................................

304.804

Contract Cost and Manpower Reporting....................................

342.7002(e)

Contract Distribution...................................................

304.201

Contract Execution......................................................

304.101

Contract Files..........................................................

304.801

Contract Financing......................................................

332

Contract Format.........................................................

315.406-1

Contract Funding........................................................

332.7

Contract Monitoring.....................................................

342.70

Contract Numbering......................................................

304.7001

Contract Reporting......................................................

304.601
Contract Types:
Cost-Plus-Fixed-Fee.....................................................
316.306
Cost-Reimbursement......................................................
316.3
Cost Sharing............................................................
316.303; 335.070
Incentive...............................................................
316.403
Time-and-Materials, Labor-Hour, and Letter..............................
316.6

Contracts with Government Employees.....................................

303.602

Contracts, Voiding and Rescinding.......................................

303.704

Contracting Authority...................................................

301.601

Contracting Officer Selection and Appointment...........................

301.603

Contracting Officer's Signature.........................................

304.101

Contracting with SBA....................................................

319.8

Contractors, Responsible Prospective....................................

309.1

Contractor vs. Government Performance (A-76)............................

307.3

Cost Accounting Standards, Waiver.......................................

330.201-5

Cost Overruns...........................................................

342.71

Cost/Pricing Data.......................................................

315.804; 315.805

Cost-Reimbursement Contracts............................................

316.3

Cost Sharing............................................................

316.303; 335.070

Data, Treatment of (in Contract Proposals)..............................

315.413

DCIS (Departmental Contract Information System).........................

304.601

Debarment, Suspension, and Ineligibility................................

309.4

Debriefing of Unsuccessful Offerors.....................................

315.1003

Definitions.............................................................

302.1

Determinations and Findings.............................................

301.7
Determinations and Findings Format:
Cost-Type Contract......................................................
316.301-3

Deviation...............................................................

301.4

Disclosure and Use of Information Before Award..........................

315.413

Discussion, Written or Oral.............................................

315.610

Disputes and Appeals....................................................

333.2

Distribution of Contract Documents......................................

304.201

Duty-Free Importation of Goods..........................................

325.1

Eight-A (8a) Program (SBA)..............................................

319.8

Evaluation of Proposals.................................................

315.608
Cost or Price...........................................................
315.608-77
Technical...............................................................
315.608-75, and 76

Evaluation Factors (RFP)................................................

315.406-5(c)

Evaluators, Use of Outside..............................................

315.608-71(f)

Exclusion of Sources....................................................

306.2

[[Page 153]]

Execution of Contract...................................................

304.101

Executive Committee for Acquisition.....................................

301.202

Expert and Consulting Services..........................................

337.2

Facsimile Bids..........................................................

314.202-7

Facsimile Proposals.....................................................

315.402

Federal Procurement Data System.........................................

See DCIS

Field Pricing Support...................................................

315.805-5

Final Indirect Cost Rates...............................................

342.705

Financing, Contract.....................................................

332

Foreign Purchases.......................................................

325

Forms, Acquisition (Illustration of)....................................

353.3

Freedom of Information Act (FOIA).......................................

324.2

Full and Open Competition After Exclusion of Sources....................

306.2

Funding Contracts.......................................................

332.7

Government Employees Training Act (Acquisition Under)...................

317.71

Government Property.....................................................

345

Gratuities, Contractor (to Government Personnel)........................

303.203

Head of the Agency......................................................

302.1

Head of Contracting Activity............................................

301.670

Imprest Fund............................................................

313.4

Incremental Funding of Cost-Reimbursement Contracts.....................

332.702

Indirect Cost Rates.....................................................

342.705

Indian Preference.......................................................

370.2

Individual Deviation....................................................

301.403

Ineligibility...........................................................

309.4

Institutional Cost-Sharing Agreements...................................

335.070-4

Invoice Processing......................................................

332.905

Justification for Other than Full and Open Competition..................

306.303

Labor Surplus Area Concerns.............................................

320.1

Letter Contract.........................................................

316.603

Letter of Credit, Recipients and Central Point Addressees...............

Attachment I

Letters of Credit.......................................................

332.406

Letters of Intent.......................................................

316.770-1

Limitation of Costs or Funds............................................

332.704

Major System Acquisition................................................

334.003

Meetings, Conferences, Seminars (Accessibility to for Disabled).........

370.1

Memorandums of Understanding............................................

316.770-2

Mistakes in Bids........................................................

314.406 (315.607)
Before Award............................................................
314.406-3
After Award.............................................................
314.406-4

Monitoring, Contract....................................................

342.70

Negotiation Memorandum, Preparation of..................................

315.672

Negotiation with Selected Source........................................

315.670

Notifications to Offerors...............................................

315.1001

Numbering System, Acquisition Instrument Identification.................

304.70

OMB Control Numbers.....................................................

301.105

Options.................................................................

317.2

Other than Full and Open Competition....................................

306.3

Paid Advertisements.....................................................

305.5

Paperwork Reduction Act (Clause)........................................

352.270-7

Personal Service Contracts..............................................

337.104

Phasing.................................................................

307.105-3

Plan, Subcontracting, Small and Disadvantaged Businesses................

319.705

Plan, Technical Evaluation..............................................

315.608-70

Planning, Acquisition...................................................

307.1

Post Negotiation Contract Preparation and Award.........................

315.671

Postaward Orientation (Letters).........................................

342.504

[[Page 154]]

Pre-Proposal Conferences................................................

315.409

Presolicitation Notices and Conferences.................................

315.404

Price Negotiation.......................................................

315.805

Pricing Data............................................................

See Cost/Pricing Data

Principal Official Responsible for Acquisition..........................

302.1

Privacy Act.............................................................

324.1

Processing Requests for Training........................................

317.7102

Profit or Free (Structured Approach)....................................

315.905-70
Program Personnel Responsibilities:
Accessibility of Meetings, Conferences, Seminars to Persons with 
Disabilities............................................................
370.102(b)
ADP Clearances..........................................................
339.7001
ADP Systems Security....................................................
339.7002
Award Instrument, Selecting.............................................
307.7004
Business Practices, Reporting Improper..................................
303
Contract Monitoring.....................................................
342.7002
Government Property, Providing..........................................
345.370(c)
    Other than Full and Open Competition:
Approval of JOFOC.......................................................
306.304
Circumstances Permitting................................................
306.302
Preparing JOFOC.........................................................
306.303
    Planning:
Advance Acquisition (Scheduling)........................................
307.71
Acquisition Document:
Content.................................................................
307.105
Preparation.............................................................
307.104-3
Responsibility..........................................................
307.104-2
Special Program Clearances..............................................
307.105-2
Statement of Work.......................................................
307.105-3
    Privacy Act:
Determination...........................................................
324.102
System Notice...........................................................
324.103
    Request for Contract:
Content.................................................................
315.7004
Procedures..............................................................
315.7002
Responsibilities........................................................
315.7003
    Request for Proposals:
Evaluation Criteria Development.........................................
315.406-5(c)
Preparation.............................................................
315.406
Technical Proposal Instructions.........................................
315.406-5(b)(2)
    Source Selection:
Competitive Range.......................................................
315.609(i)
Evaluation of Proposals (Need for Confidentiality)......................
315.604(d)
Handling and Disclosing Proposals.......................................
315.608-72
Rating and Ranking Proposals............................................
315.608-75
Technical Evaluation Panel..............................................
315.608-71, 74
Technical Evaluation Plan...............................................
315.608-70
Technical Evaluation Report.............................................
315.608-76
Training................................................................
307.170

Program Training Requirements...........................................

307.170

Progress Payments, Unusual..............................................

332.501

Prompt Payment..........................................................

332.9

Prompt Payment..........................................................

332.905

Proposals, Evaluation of................................................

315.608

Proposals, Unsolicited..................................................

315.5

Proposed Contract Awards, Review and Approval of........................

304.71

Protective Services.....................................................

337.109

[[Page 155]]

Protests Against Award..................................................

333.1

Providing Government Property...........................................

345.370

Provisions, Solicitation................................................

352.2; 315.407

Purchase Descriptions, Statements of Work, Specifications...............

307.105-3

Purchase Orders.........................................................

313.5

Purchase Orders, Numbering of...........................................

304.7003

Ratification of Unauthorized Commitments................................

301.602-3

Records of Contract Actions.............................................

304.801

References and Citations to HHSAR and FAR...............................

301.104-2(c)

Regulation System.......................................................

301.101

Rejection of Bids (After Opening).......................................

314.404

Relative Importance or Weight (Evaluation Criteria).....................

315.406-5(c)(4)

Representations and Certifications......................................

315.406-5
Annual Submission.......................................................
314.213; 315.471

Requests for Contract-Content, Format, Procedures.......................

315.70
Requests for Proposals:
Review..................................................................
315.470
Preparation and Contents................................................
315.406

Requests for Quotations.................................................

313.107; 315.406

Rescinding Contracts....................................................

303.7

Research and Development Contracts......................................

335.070

Response Time for Solicitations.........................................

315.408

Responsible Prospective Contractors.....................................

309.1

Retention of Files......................................................

FAR 4.805

Review and Approval of Proposed Contract Awards.........................

304.71

Review and Approval of JOFOC's..........................................

306.304

Review of Requests for Contracts........................................

315.7007

Review of Requests for Proposals........................................

315.470

Review of Work Statements...............................................

315.7004

Revisions to HHSAR......................................................

301.206

Scheduling..............................................................

307.71

Selection of Contracting Officers.......................................

301.603

Selection of Offerors...................................................

315.609

Service Contracts in General............................................

337.1

Set-Asides for Small Business...........................................

319.5

Small Business and Small Disadvantaged Business Concerns................

319

Small and Disadvantaged Business Utilization Specialist (SADBUS)........

319.201-70

Small Purchases.........................................................

313.1
Solicitations:
Amendment...............................................................
315.410
Availability............................................................
305.102
Issuance................................................................
315.408
Information and Planning Purposes.......................................
315.405
Numbering...............................................................
304.7002
Provisions..............................................................
352.2

Source List.............................................................

315.7005(a)(7)

Source Selection........................................................

315.6

Special Contract Clauses................................................

352.2

Special Program Clearances and Approvals................................

307.105-2; 315.7005(a)(8)

Specifications, Purchase Descriptions, Statements of Work...............

307.105-3

Standards of Conduct....................................................

303.101-3

Statements of Work, Specifications, Purchase Descriptions...............

307.105-3

Subcontracting with Small and Disadvantaged Businesses..................

319.7

Subcontractor Kickbacks.................................................

303.502

Synopsizing, Exceptions to..............................................

305.202

System, Departmental Contract Information (DCIS)........................

304.601

[[Page 156]]

Systems (ADP) Security..................................................

339.7002

Technical Evaluation Panel..............................................

315.608-71

Technical Evaluation Plan...............................................

315.608-70

Technical Evaluation Report.............................................

315.608-76

Technical Proposal Instructions.........................................

315.406-5(b)(2)

Training, Processing Requests for.......................................

317.7102

Treatment of Data in Contract Proposals.................................

315.413

Term or Level of Effort Work Statement..................................

307.105-3

Time-and-Materials Contract.............................................

316.601

Unauthorized Commitments, Ratification of...............................

301.602-3

Unauthorized Types of Agreements........................................

316.770

Unsolicited Proposals...................................................

315.5

Voiding Contracts.......................................................

303.704

Walsh-Healey Act........................................................

322.6

Weight, Relative Importance (Evaluation Criteria).......................

315.406-5(c)(4)

Withdrawing or Modifying Small Business Set-Aside.......................

319.506

Withholding of Payments.................................................

342.7003

Year-end Acquisitions...................................................

307.71

[[Page 157]]





                    APPENDIX A--PUBLIC HEALTH SERVICE




                       (Parts PHS 300 to PHS 399)

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

                          SUBCHAPTER A--GENERAL
PHS Part                                                            Page
301             PHS Acquisition Regulation System...........         158
302             Definitions of words and terms..............         160
304             Administrative matters......................         160
                   SUBCHAPTER B--ACQUISITION PLANNING
305             Publicizing contract actions................         164
306             Competition requirements....................         164
          SUBCHAPTER C--CONTRACTING METHODS AND CONTRACT TYPES
314             Formal advertising..........................         165
315             Contracting by negotiation..................         165
                  SUBCHAPTER D--SOCIOECONOMIC PROGRAMS
323             Environment, conservation, and occupational 
                    safety..................................         166
             SUBCHAPTER E--GENERAL CONTRACTING REQUIREMENTS
333             Protests, disputes, and appeals.............         168
             SUBCHAPTER F--SPECIAL CATEGORIES OF CONTRACTING
335             Research and development contracting........         169
336             Construction and architect-engineer 
                    contracts...............................         169
                     SUBCHAPTER H--CLAUSES AND FORMS
352             Solicitation provisions and contract clauses         171
                   SUBCHAPTER T--PHS SUPPLEMENTATIONS
380             Special program requirements affecting PHS 
                    acquisitions............................         210

[[Page 158]]





                          SUBCHAPTER A--GENERAL





PART PHS 301--PHS ACQUISITION REGULATION SYSTEM--Table of Contents




             Subpart PHS 301.1--Purpose, Authority, Issuance

Sec.
PHS 301.101  Purpose.
PHS 301.102  Authority.
PHS 301.103  Applicability.
PHS 301.104  Issuance.
PHS 301.104-1  Publication and code arrangement.
PHS 301.104-2  Arrangement of regulations.
PHS 301.104-3  Copies.
PHS 301.105  OMB approval under the Paperwork Reduction Act.

                    Subpart PHS 301.2--Administration

PHS 301.201  Maintenance of the PHSAR.
PHS 301.270  Procurement Management Advisory Committee.
PHS 301.271  Timing of PHSAR revisions.

               Subpart PHS 301.4--Deviations From the FAR

PHS 301.470  Procedure.

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

    Source:  49 FR 36237, Sept. 14, 1984, unless otherwise noted.



             Subpart PHS 301.1--Purpose, Authority, Issuance



PHS 301.101  Purpose.

    (a) The Public Health Service Acquisition Regulation (PHSAR) is 
issued to establish uniform acquisition policies and procedures 
throughout PHS which are necessary to implement or supplement the 
Department of Health and Human Services Acquisition Regulation (HHSAR).
    (b) PHS issuances do not reiterate material published in the HHSAR 
or the Federal Acquisition Regulation (FAR).
    (c) The PHSAR implements and supplements the HHSAR. Implementing 
material expands upon or indicates the manner of compliance with the 
related HHSAR. Supplementing material is new material which has no 
counterpart in the HHSAR. The omission of sections or subsections in 
PHSAR means no further explanation or qualification is necessary for 
implementation within PHS. Therefore, in order to obtain comprehensive 
coverage and assure consideration of all acquisition policies and 
procedures pertinent to PHS, the FAR, HHSAR, and PHSAR should be read.



PHS 301.102  Authority.

    (a) The HHSAR authorizes supplementation or implementation of the 
FAR and HHSAR in accordance with prescribed procedures (see 301.301) in 
order to publish essential acquisition instructions, policies, and 
procedures that do not conflict with, supersede or duplicate that 
prescribed by the FAR and the HHSAR.



PHS 301.103  Applicability.

    The FAR, HHSAR and PHSAR issuances apply to all acquisitions made by 
PHS procuring activities as defined in FAR 1.103.



PHS 301.104  Issuance.



PHS 301.104-1  Publication and code arrangement.

    (a) The PHSAR is published in the same forms as indicated in FAR 
1.104-1(a).
    (b) PHS issuances will be published on yellow pages in looseleaf 
form for insertion into the HHSAR.



PHS 301.104-2  Arrangement of regulations.

    (a) General. The PHSAR conforms to the FAR and HHSAR with respect to 
divisional arrangements; i.e., subchapters, parts, subparts, sections, 
subsections, and paragraphs.
    (c) References and citations.
    (2) This regulation shall be referred to as the Public Health 
Service Acquisition Regulation (PHSAR), Appendix A to the Department of 
Health and Human Services Acquisition Regulation. Any reference shall be 
cited as ``PHS'' followed by the appropriate number.
    (3) Citations of authority shall be incorporated where necessary. 
All FAR reference numbers shall be preceded by ``FAR.'' References to 
the HHSAR shall

[[Page 159]]

state only the number without the prefix ``HHSAR.''



PHS 301.104-3  Copies.

    Copies of the PHSAR in Federal Register form may be purchased by the 
public from the Superintendent of Documents, Government Printing Office 
(GPO), Washington, DC 20402. Looseleaf copies of the PHSAR may be 
obtained by departmental personnel having a need for the document by 
placing an order with a Directives Distribution Coordinator in 
accordance with General Administration Manual Chapter 1-00, Exhibit G, 
HHS Staff Manual System.



PHS 301.105  OMB approval under the Paperwork Reduction Act.

    The following OMB control numbers apply to the information 
collection and recordkeeping requirements contained in this regulation:

                                                                        
------------------------------------------------------------------------
                                                                  OMB   
                        PHSAR segment                           control 
                                                                  No.   
------------------------------------------------------------------------
All segments (excluding PHS 352.223-70 and PHS 252.232-70)..   0990-0128
PHS 352.223-70..............................................   0990-0137
PHS 352.232-70..............................................   0990-0134
------------------------------------------------------------------------

[49 FR 36237, Sept. 14, 1984, as amended at 51 FR 20486, June 5, 1986]



                    Subpart PHS 301.2--Administration



PHS 301.201  Maintenance of PHSAR.

    The PHSAR is maintained by the Division of Grants and Contracts, 
Office of Resource Management, Office of Management, PHS. The Director, 
Division of Grants and Contracts is responsible for developing and 
preparing material to be included in the PHSAR.



PHS 301.270  Procurement management advisory committee.

    (a) The Director, Division of Grants and Contracts has established 
the Procurement Management Advisory Committee (PMAC) to assist and 
facilitate the planning and development of acquisition policies and 
procedures, and the resolving of operational problems affecting all 
acquisition activities in the PHS.
    (b) The PMAC consists of members and alternates from the Office of 
the Assistant Secretary for Health, Alcohol, Drug Abuse, and Mental 
Health Administration, Centers for Disease Control, Food and Drug 
Administration, Health Resources and Services Administration, and 
National Institutes of Health.
[49 FR 36237, Sept. 14, 1984, as amended at 51 FR 20486, June 5, 1986]



PHS 301.271  Timing of PHSAR revisions.

    PHSAR revisions will be issued throughout the year as the need 
arises. PHS issuances shall be effective on the date cited in the 
Federal Register issuance or on the date of the transmittal notice which 
distributes it to PHSAR Staff Manual holders, unless otherwise directed.



               Subpart PHS 301.4--Deviations From the FAR



PHS 301.470  Procedure.

    (a) Requests for deviations from the FAR, HHSAR or any PHSAR 
issuance for implementation or supplementation shall be submitted in 
writing by the PHS agency principal official responsible for acquisition 
to the Director, Division of Grants and Contracts, ORM/OM/PHS for 
approval and/or further processing as may be required. When it is 
recognized that a deviation will be required prior to the issuance of a 
solicitation, the request for deviation must be processed and approved 
prior to release of the solicitation. When completion of a contract 
action is contingent on approval of a deviation, the request for 
deviation must be processed and approval granted by the appropriate 
level, prior to contract execution. In an exigency situation, initial 
verbal contact should be made with the Chief, Contracts Management 
Branch, DGC/ORM/OM/PHS or his/her designee. Only deviations to the PHSAR 
may be granted by the Director, Division of Grants and Contracts.
    (b) Each request for deviation shall provide sufficient information 
to permit PHS compliance with the HHSAR. Generally, such requests shall 
contain the following in addition to the information required by 
301.470(b):
    (1) The name of the contractor and contract number, or the name of 
the

[[Page 160]]

proposed contractor and the solicitation number.
    (2) A statement indicating whether or not the deviation had been 
previously requested. If so, outline the circumstances involved and the 
disposition of that request.
[49 FR 36237, Sept. 14, 1984, as amended at 51 FR 20486, June 5, 1986]



PART PHS 302--DEFINITIONS OF WORDS AND TERMS--Table of Contents




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



                     Subpart PHS 302.1--Definitions



PHS 302.170  Definitions of terms.

    The following terms, when utilized in PHS supplementing or 
implementing issuances to the HHSAR, have the meanings set forth below.
    PHS agencies identifies collectively that group of organizational 
entities within the PHS which have assigned major health functions as 
currently shown in the PHS Organization Handbook. The PHS agencies are 
as follows:

Alcohol, Drug Abuse, and Mental Health Administration (ADAMHA)
Centers for Disease Control (CDC)
Food and Drug Administration (FDA)
Health Resources and Services Administration (HRSA)
National Institutes of Health (NIH)

    PHS agency heads identifies collectively those individuals who are 
given the responsibility and authority to manage and direct the efforts 
of the PHS agencies. These are the Administrators of ADAMHA and HRSA, 
Commissioner of FDA, and Directors of NIH and CDC.
    PHS contracting activities identifies collectively those 
organizational elements of the PHS staff offices and the PHS agencies 
which have functional responsibility to contract for the acquisition of 
personal property and nonpersonal services.
[49 FR 36238, Sept. 14, 1984]



PART PHS 304--ADMINISTRATIVE MATTERS--Table of Contents




                  Subpart PHS 304.1--Contract Execution

Sec.
PHS 304.170  Ratification of unauthorized contract awards.

                  Subpart PHS 304.6--Contract Reporting

PHS 304.670  PHS Contract Information System.
PHS 304.670-1  Policy.
PHS 304.670-2  PHS agency implementation.

   Subpart PHS 304.71--Review and Approval of Proposed Contract Awards

PHS 304.7101  Contracts requiring review and approval.
PHS 304.7102  Conduct of the review.

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

    Source:  49 FR 36238, Sept. 14, 1984, unless otherwise noted.



                  Subpart PHS 304.1--Contract Execution



PHS 304.170  Ratification of unauthorized contract awards.

    (c)(2) Where ratification of an unauthorized contract action within 
a PHS agency is requested, the contracting officer shall forward the 
file through acquisition channels to an official at an organizational 
level above the contracting officer. He/she in turn shall analyze and 
evaluate the contracting officer's submission and make appropriate 
recommendations regarding ratification to the head of the contracting 
activity.
    The Administrative Services Center (ASC), Office of Management (OM), 
will submit its requests for ratification to the Director, OM through 
the Division of Grants and Contracts (DGC), Office of Resource 
Management, OM/PHS.
    (c)(4)(i) PHS agencies, and ASC, OM/PHS, shall submit a report of 
ratification data as specified in 304.170. PHS agencies with several 
contracting offices will be required to collect the required information 
from these activities and submit a consolidated agency report.
    (ii) These reports shall be submitted to DGC/ORM/OM/PHS within 20 
days following the expiration of the reporting period. A consolidated 
PHS report will be prepared for submission to the Deputy Assistant 
Secretary for Procurement, Assistance, and Logistics as specified in 
304.170.

[[Page 161]]



                  Subpart PHS 304.6--Contract Reporting



PHS 304.670  PHS Contract Information System (PHSCIS).

    The PHS Contract Information System consolidates all PHS contract 
data for the Department-wide Contract Information System (DCIS) from the 
PHS contracting activities.



PHS 304.670-1  Policy

    The PHS principal officials responsible for acquisition (PORA) are 
responsible for ensuring that all required information is collected, 
submitted, and received into the PHSCIS in accordance with the central 
PHSCIS User Manual.
[49 FR 36238, Sept. 14, 1984, as amended at 51 FR 20486, June 5, 1986]



PHS 304.670-2  PHS agency implementation.

    It is the responsibility of the PORAs to develop and implement 
appropriate procedures within their activities to ensure that data 
submissions to the PHSCIS are timely, error free, and contain all the 
required information.



   Subpart PHS 304.71--Review and Approval of Proposed Contract Awards



PHS 304.7101  Contracts requiring review and approval.

    (b)(2)(i) In addition to the reviews required by 304.7101(a) and PHS 
304.7101(c), internal reviews are to be conducted of acquisitions made 
by the following contracting offices in the National Institutes of 
Health for contract awards that fall below the dollar threshold for 
review and approval set forth in PHS 304.7101(c) but exceed the dollar 
threshold set forth herein:

National Cancer Institute--$750,000
National Heart, Lung, and Blood Institute--$500,000
National Institute of Environmental Health Sciences--$250,000
National Institute of Allergy and Infectious Diseases--$250,000
National Institute of Child Health and Human Development--$250,000
Centralized procuring activity for all other National Institutes of 
Health Research Organizations (Research Contracts Branch)--$250,000


These internal reviews shall be conducted by senior personnel with each 
contracting office. Typically, the chief of contracting office or his/
her deputy should be involved in the review. Personnel involved in the 
contract action shall not perform the review. Each review shall be 
documented in writing, and any substantive issues identified shall be 
resolved prior to award.
    (ii) Furthermore, to assure that an adequate review of smaller 
dollar acquisitions is made prior to award, a statistically significant 
sample of contract actions of dollar values, less than those amounts 
referenced in this section is required to be approved prior to award. 
This review and approval will be by the designated Reviewing Official 
listed in paragraph (c) (but see PHS 304.7102(a)). Records of such 
review actions will be maintained and will include documentation of the 
resolution of any significant issue raised by the review.
    (iii) Contract awards and modifications of proposed architect-
engineer contracts expected to exceed $50,000 shall be reviewed and 
approved prior to award by the reviewing official designated in PHS 
304.7101(c).
    (c) Reviewing officials. For PHS agency contract awards expected to 
exceed the dollar amounts stated in this paragraph, the reviewing 
official indicated will personally approve the award. Other than these 
specified requirements for the designated reviewing official, PHS 
agencies may assign other review and approval responsibilities at their 
discretion. The following officials shall be responsible for preaward 
contract review and approval of all proposed contracts and modifications 
which are expected to exceed the dollar limits expressed below:

[[Page 162]]



                                                   *COM025*                                                     
----------------------------------------------------------------------------------------------------------------
   Review and approval required for                                                                             
     contracts expected to exceed         PHS acquisition activity                Reviewing official            
----------------------------------------------------------------------------------------------------------------
                                  Office of the Assistant Secretary for Health                                  
                                                                                                                
----------------------------------------------------------------------------------------------------------------
$300,000.............................  Administrative Services        Director, Administrative Services Center. 
                                        Center, Office of Management.                                           
                                                                                                                
----------------------------------------------------------------------------------------------------------------
                              Alcohol, Drug Abuse and Mental Health Administration                              
                                                                                                                
----------------------------------------------------------------------------------------------------------------
300,000..............................  National Institute on Drug     Director, Division of Grants and Contracts
                                        Abuse.                         Management.                              
300,000..............................  National Institute on Alcohol      Do.                                   
                                        Abuse and Alcoholism.                                                   
300,000..............................  National Institute of Mental       Do.                                   
                                        Health.                                                                 
300,000..............................  St Elizabeths, Hospital, NIMH      Do.                                   
50,000...............................  Addiction Research Center....      Do.                                   
                                                                                                                
----------------------------------------------------------------------------------------------------------------
                                           Centers for Disease Control                                          
                                                                                                                
----------------------------------------------------------------------------------------------------------------
300,000..............................  Centers for Disease Control..  Director, Procurement and Grants Office.  
                                                                                                                
----------------------------------------------------------------------------------------------------------------
                                          Food and Drug Administration                                          
                                                                                                                
----------------------------------------------------------------------------------------------------------------
300,000..............................  Division of Contracts and      Director, Division of Contracts and Grants
                                        Grants Management.             Management.                              
300,000..............................  National Center for                Do.                                   
                                        Toxicological Research.                                                 
                                                                                                                
----------------------------------------------------------------------------------------------------------------
                                          National Institutes of Health                                         
                                                                                                                
----------------------------------------------------------------------------------------------------------------
1,500,000............................  National Cancer Institute....  Director, Division of Contracts and       
                                                                       Grants.                                  
1,000,000............................  National Heart, Lung, and          Do.                                   
                                        Blood Institute.                                                        
                                                                                                                
----------------------------------------------------------------------------------------------------------------
                              National Institutes of Environmental Health Sciences                              
                                                                                                                
----------------------------------------------------------------------------------------------------------------
1,000,000............................  Research and development           Do.                                   
                                        awards.                                                                 
100,000..............................  Other than research and        Director, Division of Procurement.        
                                        development.                                                            
750,000..............................  National Institute of Child    Director, Division of Contracts and       
                                        Health and Human Development.  Grants.                                  
750,000..............................  National Institute of Allergy      Do.                                   
                                        and Infectious Diseases.                                                
500,000..............................  National Institute of              Do.                                   
                                        Neurological and                                                        
                                        Communicative Disorders and                                             
                                        Stroke.                                                                 
                                                                                                                
----------------------------------------------------------------------------------------------------------------
                                          National Library of Medicine                                          
                                                                                                                
----------------------------------------------------------------------------------------------------------------
500,000..............................  Research and development       Director, Division of Contracts and       
                                        awards.                        Grants.                                  
250,000..............................  Other than research and        Director, Division of Procurement.        
                                        development.                                                            
250,000..............................  National Institute of Dental   Director, Division of Contracts and       
                                        Research.                      Grants.                                  
250,000..............................  National Institute of              Do.                                   
                                        Arthritis, Metabolism and                                               
                                        Digestive Diseases.                                                     
750,000..............................  Centralized procuring              Do.                                   
                                        activity for all other                                                  
                                        National Institutes of                                                  
                                        Health Research                                                         
                                        Organizations.                                                          
250,000..............................  Procurement Branch, Division   Director, Division of Procurement.        
                                        of Procurement, ORS.                                                    
                                                                                                                
----------------------------------------------------------------------------------------------------------------
                                  Health Resources and Services Administration                                  
                                                                                                                
----------------------------------------------------------------------------------------------------------------
500,000..............................  Awards made by Headquarters    Director, Division of Grants and          
                                        and the Indian Health          Procurement Management.                  
                                        Service.                                                                
300,000..............................  Awards made by other than          Do.                                   
                                        Headquarters and the Indian                                             
                                        Health Service.                                                         
----------------------------------------------------------------------------------------------------------------


[[Page 163]]

[49 FR 36238, Sept. 14, 1984, as amended at 51 FR 20486, June 5, 1986]



PHS 304.7102  Conduct of the review.

    (a) General. The reviewing official is not required to personally 
perform the review, but he or she is responsible for assuring that the 
reviewer is knowledgeable in the acquisition field and has sufficient 
expertise to perform a comprehensive review and to make cogent 
recommendations to the reviewing official for actions exceeding the 
dollar amounts stated in this subpart. The reviewing official shall 
approve each proposed contract award that is reviewed.

[[Page 164]]





                   SUBCHAPTER B--ACQUISITION PLANNING





PART PHS 305--PUBLICIZING CONTRACT ACTIONS--Table of Contents




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



        Subpart PHS 305.2--Synopses of Proposed Contract Actions



PHS 305.202  Exceptions.

    (b) A determination and finding has been executed by the Acting 
Assistant Secretary for Health after concurrence by the Administrator of 
the Office of Federal Procurement Policy and the Administrator of the 
Small Business Administration, which exempts for the period September 
30, 1985 through September 29, 1988, certain acquisitions with the 
National Academy of Sciences (NAS) from the synopsis requirements set 
forth in FAR 5.201. This exemption is applicable only to acquisitions 
where NAS is the only source which can provide the measure of expertise, 
independence, objectivity, and audience acceptance necessary to meet the 
program requirements. To ensure that this exemption will be used only 
when appropriate, the agency competition advocate shall certify, prior 
to award, each acquisition with NAS which is not synopsized regardless 
of the dollar value. The certification must state that only NAS can 
provide the measure of expertise, independence, objectivity, and 
audience acceptance necessary to meet the program needs.
[51 FR 20487, June 5, 1986]



PART PHS 306--COMPETITION REQUIREMENTS--Table of Contents




         Subpart PHS 306.3--Other Than Full and Open Competition

Sec.
PHS 306.304  Approval of the justification.

                Subpart PHS 306.5--Competition Advocates

PHS 306.502  Duties and responsibilities.

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

    Source:  51 FR 20487, June 5, 1986, unless otherwise noted.



         Subpart PHS 306.3--Other Than Full and Open Competition



PHS 306.304  Approval of the justification.

    (a)(3) The Deputy Assistant Secretary for Health, Operations, PHS, 
is designated as the approving official referenced in FAR 6.304(a)(3) 
and 306.304(a)(3).



                Subpart PHS 306.5--Competition Advocates



PHS 306.502  Duties and responsibilities

    (b) The competition advocates for the PHS activities shall 
coordinate their efforts with the PHS competition advocate, the Deputy 
Assistant Secretary for Health Operations.

[[Page 165]]





          SUBCHAPTER C--CONTRACTING METHODS AND CONTRACT TYPES





PART PHS 314--FORMAL ADVERTISING--Table of Contents




        Subpart PHS 314.4--Opening of Bids and Award of Contract

Sec.
PHS 314.406-3  Other mistakes disclosed before award.
PHS 314.406-4  Mistakes after award.

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



        Subpart PHS 314.4--Opening of Bids and Award of Contract



PHS 314.406-3  Other mistakes disclosed before award.

    (g)(3) In addition to the requirement in 314.406-3(g)(3), a copy of 
the data required by FAR 14.406-3(g)(3) shall be sent to the Office of 
General Counsel, Business and Administrative Law Division, Parklawn 
Building, Room 17A-32, 5600 Fishers Lane, Rockville, MD 20857. An 
information copy of the contracting officer's written statement of facts 
and circumstances shall be provided to the Contracts Management Branch, 
DGC/ORM/OM/PHS.
[51 FR 20488, June 5, 1986]



PHS 314.406-4  Mistakes after award.

    (e)(2) The data shall be submitted as prescribed in PHS 314.406-
3(g)(3).
[51 FR 20488, June 5, 1986]



PART PHS 315--CONTRACTING BY NEGOTIATION--Table of Contents






 Subpart PHS 315.4--Solicitation and Receipt of Proposals and Quotations

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



PHS 315.412  Late proposals and modifications.

    (c)(1) When the principal official responsible for acquisition 
determines that certain classes of biomedical or behavioral research and 
development acquisitions should be subject to conditions other than 
those specified in FAR 52.215-10, Late Submissions, Modifications and 
Withdrawals of Proposals, he/she may authorize the use of the provision 
in PHS 352.215-10 in addition to the provision at FAR 52.215-10.
    (2) When the provision in PHS 352.215-10 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 PHS 352.215-10 
and, therefore, can be considered.
[51 FR 43357, Dec. 2, 1986; 51 FR 45229, Dec. 17, 1987, as amended at 52 
FR 44397, Nov. 19, 1987]

[[Page 166]]





                  SUBCHAPTER D--SOCIOECONOMIC PROGRAMS





PART PHS 323--ENVIRONMENT, CONSERVATION, AND OCCUPATIONAL SAFETY--Table of Contents




                  Subpart PHS 323.70--Safety and Health

Sec.
PHS 323.7000  Scope of subpart.
PHS 323.7001  General.
PHS 323.7002  Policy.
PHS 323.7003  Actions required.
PHS 323.7004  Contract clause.
PHS 323.7005  Solicitation notice--construction.

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

    Source:  51 FR 20488, June 5, 1986, unless otherwise noted.



                  Subpart PHS 323.70--Safety and Health



PHS 323.7000  Scope of subpart.

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



PHS 323.7001  General.

    Various statutes and regulations (e.g., Walsh-Healey Act; Service 
Contract Act) require adherence to minimum safety and health standards 
by contractors engaged in potentially hazardous work. Positive action to 
reduce accidents and conditions hazardous to health under all contracts 
is in the Government's interest since the cost of such accident and 
health hazards is borne by the Government through higher prices and 
sometimes by direct indemnification of contractors against liability 
claims.



PHS 323.7002  Policy.

    (a) The guidance contained in FAR Subpart 23.3 shall be used for 
hazardous material as the primary reference. When that guidance is 
judged insufficient or does not meet the safety and health situation in 
the instant acquisition, this subpart shall be followed.
    (b) Whenever the performance of a contract will require use of 
hazardous materials or operations, the contracting activity shall 
require the prime contractor and subcontractors to:
    (1) Provide protection for the life and health of PHS employees, 
contractor employees, other persons involved with work on PHS programs 
and projects, and the public;
    (2) Avoid accidental work interruptions which could delay progress 
of PHS programs and project;
    (3) Maintain controls for the prevention of damage and loss to 
property; and
    (4) Accumulate and provide data necessary for analysis of risk and 
loss factors relating to PHS programs and projects.



PHS 323.7003  Actions required.

    (a) Contracting activities. Contracting activities shall use the 
clause set forth in PHS 352.223-70 as a guide in developing appropriate 
safety and health clauses for use in prospective contracts involving 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) Selecting or developing safety and health clause provisions for 
incorporation in a prospective contract;
    (3) Evaluating a prospective contractor's safety and health 
programs; and
    (4) Conducting post-award review 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 RFP 
or IFB:

[[Page 167]]

    (i) Ensure that hazardous materials and operations to be utilized in 
the performance of the contract are clearly identified; and
    (ii) Coordinate with the appropriate safety officer to ensure that 
all hazardous materials and operations are evaluated and that adequate 
safety requirements are established in the RFP or IFB.
    (2) During the period of performance:
    (i) Apprise the contracting officer 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.



PHS 323.7004  Contract clause.

    All contracts which require the use of hazardous materials or 
operations shall include a clause to provide adherence to minimum safety 
and health standards. The clause set forth in PHS 352.223-70 may be used 
or appropriately modified to meet the needs of the individual contract.



PHS 323.7005  Solicitation notice--construction.

    The contracting officer shall include the clause in PHS 352.223-71 
in all solicitations and resultant contracts for construction and 
construction services.

[[Page 168]]





             SUBCHAPTER E--GENERAL CONTRACTING REQUIREMENTS





PART PHS 333--PROTESTS, DISPUTES, AND APPEALS--Table of Contents




                       Subpart PHS 333.1--Protests

Sec.
PHS 333.102  General.
PHS 333.104  Protests to GAO.
PHS 333.105  Protests to GSBCA.

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

    Source:  51 FR 20488, June 5, 1986, unless otherwise noted.



                       Subpart PHS 333.1--Protests



PHS 333.102  General.

    The Division of Grants and Contracts (DGC), ORM/OM/PHS, will 
participate directly in the resolution of protests against PHS agencies 
when the Office of the Secretary, HHS, requests DGC involvement, or when 
DGC considers a protest action to be sensitive or controversial, or 
otherwise has an interest in the protest. In cases where DGC will 
participate, the cognizant PHS contracting office shall be notified. In 
those instances, all file materials and written statements normally 
forwarded directly to the Departmental Protest Control Officer shall be 
forwarded to DGC, ORM/OM/PHS.



PHS 333.104  Protests to GAO.

    (a) General. (2) A copy of the protest files shall be sent to the 
Office of General Counsel, Business and Administrative Law Division 
(OGC-BAL), Parklawn Building, Room 17A-32, 5600 Fishers Lane, Rockville, 
MD 20857. In addition, an information copy of the contracting officer's 
statement of facts required by 333.104(a)(2)(i) shall be sent to the 
Contracts Management Branch, DGC/ORM/OM/PHS.
    (b) Protests before award. (1) The head of the contracting activity 
authority to approve the written finding required by FAR 33.104(b)(1) to 
authorize a contract award while a protest is pending, may be delegated 
to an organizational level no lower than the Executive Officer of each 
PHS Agency.
    (4) The data shall be submitted as prescribed in PHS 333.104(a)(2).
    (c) Protests after award. (1) The data shall be submitted as 
prescribed in PHS 333.104(a)(2).
    (2) The head of the contracting activity authority to authorize 
contract performance notwithstanding a protest as set forth in FAR 
33.104(c)(2), may be delegated to an organizational level no lower than 
the Executive Officer of each PHS Agency.



PHS 333.105  Protests to GSBCA.

    (b) The copy of the protest file to be sent to OGC-BAL shall be sent 
to OGC-BAL, Parklawn Building, Room 17A-32, 5600 Fishers Lane, 
Rockville, MD 20857. In addition, an information copy of the contracting 
officer's statement of facts required by 333.105(b)(1) shall be sent to 
the Contracts Management Branch, DGC/ORM/OM/PHS.

[[Page 169]]





             SUBCHAPTER F--SPECIAL CATEGORIES OF CONTRACTING





PART PHS 335--RESEARCH AND DEVELOPMENT CONTRACTING--Table of Contents




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



PHS 335.080  Special determinations and findings affecting research and development contracting.

    The Assistant Secretary for Health 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).
[51 FR 20489, June 5, 1986]



PART PHS 336--CONSTRUCTION AND ARCHITECT-ENGINEER CONTRACTS--Table of Contents




             Subpart PHS 336.6--Architect-Engineer Services

Sec.
PHS 336.680  Program of Requirements approval.
PHS 336.681  Funding.

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

    Source:  51 FR 20489, June 5, 1986, unless otherwise noted.



             Subpart PHS 336.6--Architect-Engineer Services



PHS 336.680  Program of Requirements approval.

    The programmatic and technical requirements for PHS design projects 
are established in a special document known as a Program of Requirements 
(POR). In the case of design projects involving the construction of new 
space, including new facilities, replacement facilities, and building 
additions, the contracting officer shall ensure that the Office of the 
Assistant Secretary for Health has approved, or waived approval of, a 
POR prior to the issuance of the synopsis or solicitation for 
architectural/engineering services.



PHS 336.681  Funding.

    (a) The contracting officer shall ensure that the agency financial 
management officer has identified and certified that design funds have 
been appropriated and apportioned prior to the release of a synopsis or 
solicitation for architect-engineer services for the types of 
acquisitions specified in PHS 336.680. New facilities, replacement 
facilities, and building additions must only be acquired with funds 
appropriated for that specific project as evidenced by either (1) 
specific language in an appropriations act, or (2) Congressional 
appropriations intent as reflected in appropriations committee reports 
or Congressional budget justification.
    (b) In the case of ADAMHA, FDA, HRSA, and NIH, the referenced agency 
financial management officer is the Director of the agency's Division of 
Financial Management. In the case of CDC, this official is the Director 
of the Financial Management Office. Subject to HRSA concurrence, funding 
for projects of the Indian Health Service/HRSA may be certified by the 
designated financial management officer within the IHS Office of 
Administration.
    (c) The funding source certification shall include identification of 
the title, appropriation symbol, and fiscal year of the appropriation 
plus any relevant project or activity description in the appropriation 
act or reports.
    (d) In an unusual circumstance where time is critical, a synopsis or 
solicitation for architect-engineer services may be issued after the POR 
has been approved if the agency financial management officer certifies 
that appropriation and apportionment of proper funds as set forth in 
paragraph (a) above are expected within 60 days. In such cases, the 
synopsis or solicitation must specify that award is subject to the 
availability of funds. In these circumstances the contracting officer 
shall ensure that contract award is not made until the agency financial 
management officer has certified in writing

[[Page 170]]

that proper funds have been appropriated and apportioned. Other 
exceptions to the funding requirements set forth in paragraph (a) above, 
must be specifically approved in writing by the Office of the Assistant 
Secretary for Health prior to the release of a synopsis or solicitation 
for architect-engineer services for new facilities, replacement 
facilities, and building additions.

[[Page 171]]





                     SUBCHAPTER H--CLAUSES AND FORMS





PART PHS 352--SOLICITATION PROVISIONS AND CONTRACT CLAUSES--Table of Contents




           Subpart PHS 352.2--Texts of Provisions and Clauses

Sec.
PHS 352.215-10  Late proposals, modifications of proposals, and 
          withdrawals of proposals.
PHS 352.223-70  Safety and health.
PHS 352.223-71  Safety and health--construction.
PHS 352.232-70  Additional payment provision.
PHS 352.280-1  Protection of human subjects.
PHS 352.280-2  Care of laboratory animals.
PHS 352.280-3  Maximum allowable cost for drugs.
PHS 352.280-4  Contracts awarded under the Indian Self-Determination 
          Act.
PHS 352.280-6  Demurrage charge provisions for reusable cylinders and 
          containers.

            Subpart PHS 352.3--Provision and Clause Matrices

PHS 352.380-4  Contract clauses for contracts awarded under the Indian 
          Self-Determination Act.

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

    Source:  49 FR 36242, Sept. 14, 1984, unless otherwise noted.



             Subpart 352.2--Texts of Provisions and Clauses



PHS 352.215-10  Late proposals, modifications of proposals, and withdrawals of proposals.

    As prescribed in PHS 315.412, the following provision may be 
included in the solicitation when authorized by the principal official 
responsible for acquisition.

Late Proposals, Modifications of Proposals, and Withdrawals of Proposals 
                               (Nov 1986)

    Notwithstanding the procedures contained in the provision of this 
solicitation entitled Late Submissions, Modifications, and Withdrawals 
of Proposals, a proposal received after the date specified for receipt 
may be considered if it offers significant cost or technical advantages 
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)

[51 FR 43357, Dec. 2, 1986; 51 FR 45229, Dec. 17, 1987, and 52 FR 44357, 
Nov. 19, 1987]



PHS 352.223-70  Safety and health.

    The following clause is covered by the policy set forth in Subpart 
PHS 323.70 and is to be used in accordance with the instructions set 
forth in PHS 323.7002 and PHS 323.7003.

                      Safety and Health (Apr 1984)

    (a) In order to provide safety controls for protection to the life 
and health of employees and other persons; for prevention of damage to 
all property; and for avoidance of work interruptions in the performance 
of the contract; the Contractor will comply with the following 
standards: (Insert codes, standards, and criteria (including any 
applicable State and local requirements) prescribed by the Safety 
Officer.)
    Further, the Contractor shall take or cause to be taken such 
additional safety measures as the Contracting Officer may determine to 
be reasonably necessary; Provided, that, if compliance with such 
additonal safety measures results in a material increase in the cost or 
time of performance of the contract, an equitable adjustment will be 
made in accordance with the clause of this contract entitled 
``Changes.''
    (b) Prior to commencement of work, the Contractor will submit in 
writing its plan for complying with the safety and health provisions of 
this contract, and will meet with the Contracting Officer or his/her 
designated representative to discuss and develop a mutual understanding 
relative to administration of the overall safety program.
    (c) During the performance of work under this contract, the 
Contractor share comply with all procedures prescribed by the 
Contracting Officer for the control and safety of persons visiting the 
job site and will comply with such requirements to prevent accidents as 
may be prescribed by the Contracting Officer.
    (d) The Contractor will maintain an accurate record of, and report 
to the Contracting Officer in such manner as the Contracting Officer may 
prescribe, all accidents and incidents resulting in death, traumatic 
injury, occupational disease, and/or damage to all property incident to 
work performed under the contract.

[[Page 172]]

    (e) The Contracting Officer shall notify (if otherwise, confirm in 
writing) the Contractor of any noncompliance with the provisions of this 
clause and corrective action to be taken. After receipt of such notice, 
the Contractor shall immediately take such corrective action. (Such 
notice, when delivered to the Contractor or its representative at the 
site of the work, shall be deemed sufficient for the purpose.) If the 
Contractor fails or refuses to comply promptly, the Contracting Officer 
may issue an order stopping all or part of the work until satisfactory 
corrective action has been taken. No part of the time lost due to any 
such stop order shall be the subject of claim for extension of time or 
for costs or damages by the Contractor.
    (f) The Contractor shall insert the substance of this clause in each 
subcontract involving the use of hazardous materials or operations. 
Compliance with the provisions of this clause by subcontractors will be 
the responsibility of the Contractor.

                             (End of clause)

[51 FR 20489, June 5, 1986]



PHS 352.223-71  Safety and health--construction.

    The following clause shall be included in all solicitations and 
resultant contracts for construction and construction services, as 
required by PHS 323.7005.

               Safety and Health--Construction (Apr 1984)

    Your attention is invited to the regulations issued by the Secretary 
of Labor pursuant to section 107 of the Contract Work Hours and Safety 
Standards Act (40 U.S.C. 333) entitled ``Safety and Health Regulations 
for Construction'' (29 CFR Part 1926). The Contractor is required to 
comply with the referenced regulations to the extent that the resultant 
contract involves construction.

                             (End of clause)

[51 FR 20490, June 5, 1986]



PHS 352.232-70  Additional payment provision.

    The following clause shall be included in all solicitations and 
resultant contracts for construction which contain the ``Payments Under 
Fixed-Price Construction Contracts'' clause set forth in FAR 52.232-4:

                 Additional Payment Provision (Apr 1984)

    Unless otherwise stated in this contract, there will be taken into 
consideration in computing progress payments material that will be 
incorporated into the structure if such material is delivered at the 
site, or is delivered to the Contractor and properly stored by it in a 
suitable warehouse, storage yard, or similar place either within 25 
miles of the site or as otherwise approved by the Contracting Officer. 
Before each payment is made, the Contractor shall furnish to the 
Contracting Officer such evidence as he/she may require of the quantity 
and value of such material and that it will be incorporated into the 
structure. If such material is stored off the site, the Contractor shall 
also furnish to the Contracting Officer, before payment, properly 
executed bills of sale to the Government for the delivered material upon 
which such payment is to be made.

                             (End of clause)

[51 FR 20490, June 5, 1986]



PHS 352.280-1  Protection of human subjects.

    The policy and procedures to be followed whenever individuals may be 
involved as subjects in research activities supported or conducted by 
the Department under a contract are provided in Subpart PHS 380.1 and 45 
CFR Part 46, Protection of Human Subjects.
    (a) The following provisions shall be included in solicitations 
expected to involve human subjects:

  Notice To Offerors Of Requirements Of 45 CFR Part 46, Protection Of 
                        Human Subjects (Sep 1985)

    (a) Copies of the Department of Health and Human Services 
(Department) regulations for the protection of human subjects, 45 CFR 
Part 46, are available from the Office for Protection from Research 
Risks (OPRR), National Institutes of Health, 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 
the Department.
    (b) The regulations define a human subject as a living individual 
about whom an investigator (whether professional or student) conducting 
research obtains (1) data through intervention of interaction with the 
individual, or (2) 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 and is not directly regulated by 45 CFR Part 46.

[[Page 173]]

    (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 non-involvement of human 
subjects or of exempt categories of research in a project may result in 
delays in the review of a proposal. The Public Health Service 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 
OPRR, (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 OPRR 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. Prospective Contractors proposing research that 
involves human subjects shall be contacted by OPRR and given detailed 
instructions for establishing an institutional review board and filing 
an Assurance of Compliance.
    (f) It is recommended that OPRR be consulted for advice or guidance 
concerning either regulatory requirements or ethical issues pertaining 
to research involving human subjects.

                           (End of provision)

    (b) The following clause shall be included in contracts involving 
human subjects:

                 Protection of Human Subjects (OCT 1986)

    (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 Protection for 
Research Risks, National Institutes of Health, Public Health Service. 
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 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 
agency 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 judgement 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 performance of this contract, the 
Contracting Officer determines, in consultation with the Office for 
Protection from Research Risks (OPRR), National Institutes of Health 
(NIH), 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 such noncompliance. Notice of the suspension may be 
communicated by telephone and confirmed in writing. If the Contractor 
fails to complete the corrective action within the period of time 
designated in the Contracting Officer's written notice of suspension, 
the Contracting Officer may, in consultation with OPRR, 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 Department of 
Health and Human Services Human Subject Assurances.

                             (End of clause)

[51 FR 20490, June 5, 1986, as amended at 52 FR 9300, Mar. 24, 1987]



PHS 352.280-2  Care of laboratory animals.

    The policies and procedures to be used when contracts involve live 
vertebrate animals are provided in Subpart PHS 380.2, and in the PHS 
Policy on Humane Care and Use of Laboratory Animals by Awardee 
Institutions and accompanying implementation instructions published in a 
special edition of the NIH Guide for Grants and Contracts, Vol. 14, No. 
8, June 25, 1985.
    (a) The following provision shall be included in solicitations 
expected to involve vertebrate animals:

[[Page 174]]

 Notice To Offerors of Requirement for Adequate Assurance of Protection 
                of Vertebrate Animal Subjects (SEP 1985)

    The PHS Policy on Humane Care and Use of Laboratory Animals by 
Awardee Institutions establishes a number of requirements for research 
activities involving animals. Before a PHS award may be made to an 
applicant organization, the organization shall file, with the Office for 
Protection from Research Risks (OPRR), National Institutes of Health 
(NIH), PHS, 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 expretise of its 
members, to oversee the institution's animal program, facilities and 
procedures. No PHS award involving the use of animals shall be made 
unless the Animal Welfare Assurance has been approved by OPRR. 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 OPRR 
negotiate an acceptable Animal Welfare Assurance with those 
Contractor(s). For further information, OPRR may be contacted at NIH, 
Bethesda, Maryland 20892 (301-496-7041).

                           (End of provision)

    (b) The following clause shall be included in all contracts 
involving research on vertebrate animals:

               Care of Live Vertebrate Animals (OCT 1986)

    (a) Before undertaking performance of any contract involving 
research on live vertebrate animals, the Contractor shall register with 
the Secretary of Agriculture of the United States in accordance with 7 
U.S.C. 2316 and 9 CFR 2.25-2.28. The Contractor shall furnish evidence 
of such 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 2.1-2.11, 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 and Use of 
Laboratory Animals by Awardee Institutions, 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 for 
Protection from Research Risks (OPRR), National Institutes of Health 
(NIH), that the Contractor is not in compliance with any of the 
requirements and/or standards stated in paragraphs (a) and (c), above, 
the Contracting Officer may immediately suspend, in whole or in part, 
work and further payments under this contract until the Contractor 
corrects such 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 Contracing Officer's written notice of suspension, the 
Contracting Officer may, in consultation with OPRR, 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 Public Health Service 
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 Senior Staff Officer, 
Animal Care Staff, USDA/APHIS, Federal Center Building, Hyattsville, 
Maryland 20782.

                             (End of clause)

[51 FR 20491, June 5, 1986, as amended at 52 FR 9300, Mar. 24, 1987]



PHS 352.280-3  Maximum allowable cost for drugs.

    The following clause, or one reading substantially as follows, shall 
be included in all contracts subject to the provisions of the Maximum 
Allowable Cost (MAC) regulation and PHS 380.305.

               Maximum Allowable Cost for Drugs (Apr 1984)

    (a) Reimbursement for drugs provided or used under this contract 
shall be in accordance with the Maximum Allowable Cost

[[Page 175]]

(MAC) regulation set forth in 45 CFR Subtitle A, Part 19. In accordance 
with 19.3 of the MAC regulation, the amount which is recognized for 
reimbursement or payment purposes for any drug purchased under the terms 
of the contract shall not exceed the lowest of:
    (1) The maximum allowable cost of the drug, if any, established in 
accordance with 19.5 of the MAC regulation plus a reasonable dispensing 
fee;
    (2) The acquisition cost of the drug plus a reasonable dispensing 
fee; or
    (3) The provider's usual and customary charge to the public for the 
drug; Provided, That:
    (i) The maximum allowable cost established for any drug shall not 
apply to a brand of that drug prescribed for a patient which the 
prescriber has certified in his/her own handwriting is medically 
necessary for that patient; and Provided, further, That:
    (ii) When compensation for drug dispensing is included in some other 
amount payable to the provider by the reimbursing or payment program 
agency, a separate dispensing fee will not be recognized.
    (b) The Contractor agrees:
    (1) To include the following solicitation notification in all 
applicable solicitations issued under this contract and to ensure that 
subcontractors include it in any subsequent applicable solicitation:
    This acquisition is subject to the Maximum Allowable Cost (MAC) 
regulation set forth in Part 19 to Subtitle A of Title 45 of the Code of 
Federal Regulations.
    (2) To include this clause, including this paragraph (b), in all 
applicable subcontracts, regardless of tier, awarded pursuant to this 
contract.
    (3) To include the furnished MAC determination or acquisition cost 
data in all applicable solicitations issued under this contract and in 
all resultant subcontracts awarded pursuant to this contract.

                             (End of clause)



PHS 352.280-4  Contracts Awarded Under the Indian Self-Determination Act.

    (a) Insert the following clauses in cost-reimbursement contracts 
awarded under the Indian Self-Determination Act as described in subpart 
PHS 380.4.

                  Clause No. 1--Definitions (June 1977)

    As used throughout this contract, the following terms shall have the 
meaning set forth below:
    (a) The term ``Secretary'' means the Secretary, the Under Secretary, 
or any Assistant Secretary of the Department of Health and Human 
Services (HHS); and the term ``his/her duly authorized representative'' 
means any person, persons, or board (other than the Contracting Officer) 
authorized to act for the Secretary.
    (b) The term ``Contracting Officer'' means the person executing this 
contract on behalf of the Government, and any other officer or employee 
who is properly designated Contracting Officer; and the term includes, 
except as otherwise provided in this contract, the authorized 
representative of the Contracting Officer acting within the limits of 
his/her authority.
    (c) The term ``Project Officer'' means the person representing the 
Government for the purpose of monitoring contract performance. The 
Project Officer is not authorized to issue any instructions or 
directions which effect any increase or decrease in the cost of this 
contract or which change the period of this contract.
    (d) The term ``Department'' means the Department of Health and Human 
Services.
    (e) Except as otherwise provided in this contract, the term 
``subcontract'' includes purchase orders under this contract.

                             (End of clause)

                   Clause No. 2--Disputes (June 1977)

    (a) Except as otherwise provided in this contract, any dispute 
concerning a question of fact arising under this contract which is not 
disposed of by agreement shall be decided by the Contracting Officer, 
who shall reduce his/her decision to writing and mail or otherwise 
furnish a copy thereof to the Contractor. The decision of the 
Contracting Officer shall be final and conclusive unless within 30 days 
from the date of receipt of such copy, the Contractor mails or otherwise 
furnishes to the Contracting Officer a written appeal addressed to the 
Secretary. The decision of the Secretary or his/her duly authorized 
representative for the determination of such appeals shall be final and 
conclusive unless determined by a court of competent jurisdiction to 
have been fraudulent, or capricious, or arbitrary, or so grossly 
erroneous as necessarily to imply bad faith, or not supported by 
substantial evidence. In connection with any appeal proceeding under 
this clause, the Contractor shall be afforded an opportunity to be heard 
and to offer evidence in support of its appeal. Pending final decision 
of a dispute hereunder, the Contractor shall proceed diligently with the 
performance of the contract and in accordance with the Contracting 
Officer's decision.
    (b) This ``Disputes'' clause does not preclude consideration of law 
questions in connection with decisions provided for in paragraph (a) 
above: Provided, That nothing in this contract shall be construed as 
making final the decision of any administrative official, 
representative, or board on a question of law.

[[Page 176]]

                             (End of clause)

              Clause No. 3--Limitation of Cost (June 1977)

    (a) It is estimated that the total cost to the Government for the 
performance of this contract will not exceed the estimated cost set 
forth in this contract and the Contractor agrees to use its best efforts 
to perform all work and all obligations under this contract within such 
estimated costs. If at any time the Contractor has reason to believe 
that the costs which it expects to incur in the performance of this 
contract in the next succeeding sixty (60) days, when added to all costs 
previously incurred, will exceed seventy-five percent (75%) of the 
estimated cost set forth in the contract, or, if at any time the 
Contractor has reason to believe that the total cost to the Government, 
for the performance of this contract, will be substantially greater or 
less than the estimated cost thereof, the Contractor shall notify the 
Contracting Officer in writing to that effect, giving its revised 
estimate of such total cost for the performance of this contract.
    (b) The Government shall not be obligated to reimburse the 
Contractor for costs incurred in excess of the estimated cost set forth 
in the contract and the Contractor shall not be obligated to continue 
performance under the contract or to incur costs in excess of such 
estimated cost unless and until the Contracting Officer shall have 
notified the Contractor in writing that such estimated cost has been 
increased and shall have specified in such notice a revised estimated 
cost which shall thereupon constitute the estimated cost of performance 
of this contract. When and to the extent that the estimated cost set 
forth in this contract has been increased by the Contracting Officer in 
writing, any costs incurred by the Contractor in excess of such 
estimated cost prior to the increase in estimated cost shall be 
allowable to the same extent as if such costs had been incurred after 
such increase in estimated cost.

                             (End of clause)

                Clause No. 4--Allowable Cost (June 1977)

    (a) Compensation for Contractor's performance. Payment for the 
allowable cost, as herein defined and as actually incurred by the 
Contractor shall constitute full and complete compensation for the 
performance of the work under this contract.
    (b) Allowable cost. The allowable cost of performing the work under 
this contract shall be the cost actually incurred by the Contractor, 
either directly incident or properly allocable to the contract, in the 
performance of this contract in accordance with its terms. The allowable 
cost, direct and indirect, including acceptability of cost allocation 
methods, shall be determined by the Contracting Officer in accordance 
with:
    (1)(i) ``A Guide for Nonprofit Institutions Establishing Indirect 
Cost Rates for Research Grants and Contracts with the Department of 
Health and Human Services, HHS Publication OASC-5'' or (ii) ``A Guide 
for Hospitals, Grants and Contracts with the Department of Health and 
Human Services, HHS Publication OASC-3,'' or (iii) Subpart 1-15.7 of the 
Federal Procurement Regulations (41 CFR Subpart 1-15.7) if the contract 
is with a state or local government agency, or (iv) Subpart 1-15.4 of 
the Federal Procurement Regulations (41 CFR Subpart 1-15.4) if the 
contract is for the procurement of construction or architect-engineer 
services.
    (2) The terms of the contract.

                             (End of clause)

           Clause No. 5--Negotiated Overhead Rates (June 1977)

    (a) Notwithstanding the provisions of the clause of this contract 
entitled, ``Allowable Cost,'' the allowable indirect costs shall be 
obtained by applying negotiated overhead rates to bases agreed upon by 
the parties, as specified below.
    (b) The Contractor, as soon as possible, but not later than six (6) 
months after the expiration of each of the Contractor's financial years 
or such period as may mutually be agreed upon by the Government and the 
Contractor, shall submit to the Contracting Officer, with a copy to the 
cognizant audit agency, a proposed final overhead rate or rates for that 
period based on the Contractor's cost experience during that period, 
together with supporting cost data. Negotiation of final overhead rates 
by the Contractor and the Contracting Officer shall be undertaken as 
promptly as practicable after receipt of the Contractor's proposal.
    (c) Allowability of costs and acceptability of cost allocation 
methods shall be determined in accordance with the applicable cost 
principles set forth in paragraph (b)(1) of Clause 4, as in effect on 
the date of this contract, and the same hereby incorporated herein by 
reference.
    (d) The results of each negotiation shall be set forth in an 
amendment to this contract, which shall specify (1) the agreed final 
rate, (2) the bases to which the rates apply, and (3) the periods for 
which the rates apply.
    (e) Pending establishment of final overhead rates for any period, 
the Contractor shall be reimbursed either at negotiated provisional 
rates as provided in this contract or at billing rates acceptable to the 
Contracting Officer, subject to appropriate adjustment when the final 
rates for that period are established. To prevent substantial over or 
under payment, the provisional or billing rates may, at the request of 
either party, be revised by mutual agreement, either retroactively or 
prospectively. Any such revision of negotiated provisional rates 
provided in

[[Page 177]]

this contract shall be set forth in an amendment to this contract.
    (f) Any failure by the parties to agree on any final rate or rates 
under this clause shall be considered a dispute concerning a question of 
fact for decision by the Contracting Officer within the meaning of the 
clause of this contract entitled ``Disputes.''
    (g) Submission of proposed provisional and/or final overhead rates, 
together with appropriate data in support thereof, to the Secretary or 
his/her duly authorized representative, and agreements on provisional 
and/or final overhead rates entered into between the Contractor and the 
Secretary or his/her duly authorized representative, as evidenced by 
Negotiated Overhead Rate Agreements signed by both parties, shall be 
deemed to satisfy the requirements of (b), (d) and (e) above.

                             (End of clause)

                    Clause No. 6--Payment (June 1977)

    (a) Payment on account of allowable cost. Once each month (or at 
more frequent intervals if approved by the Contracting Officer) the 
Contractor may submit to the Contracting Officer, in such form and 
reasonable detail as may be required, an invoice or voucher supported by 
a statement of costs incurred by the Contractor in the performance of 
this contract and claimed to constitute allowable costs. Promptly after 
receipt of each invoice or voucher, the Government shall, subject to the 
provisions of (b) below, make payment thereon as approved by the 
Contracting Officer.
    (b) Audit Adjustments. At any time or times prior to settlement 
under this contract the Contracting Officer may have invoices or 
vouchers and statements of cost audited. Each payment theretofore made 
shall be subject to reduction for amounts included in the related 
invoice or voucher which are found by the Contracting Officer, on the 
basis of such audit, not to constitute allowable cost. Any payment may 
be reduced for overpayment, or increased for underpayments on preceding 
invoices or vouchers.
    (c) Completion voucher. On receipt and approval of the invoice or 
voucher designated by the Contractor as the ``completion invoice'' or 
``Completion Voucher'' and upon compliance by the Contractor with all 
the provisions of this contract (including without limitation, the 
provisions relating to patents and provisions of (d) below) the 
Government shall promptly pay to the Contractor any balance of allowable 
cost. The completion invoice or voucher shall be submitted by the 
Contractor promptly following completion of the work under this contract 
but in no event later than 6 months (or such longer period as the 
Contracting Officer may in his/her discretion approve in writing) from 
the date of such completion.
    (d) Applicable credits. The Contractor agrees that any refunds, 
rebates, credits, or other amounts (including any interest thereon) 
accruing to or received by the Contractor or any assignee under this 
contract shall be paid by the Contractor to the Government, to the 
extent that they are properly allocable to costs for which the 
Contractor has been reimbursed by the Government under this contract. 
Reasonable expenses incurred by the Contractor for the purpose of 
securing such refunds, rebates, credits, or other amounts shall be 
allowable cost hereunder when approved by the Contracting Officer.
    (e) Financial settlement. Prior to final payment under this 
contract, the Contractor and each assignee under this contract whose 
assignment is in effect at the time of final payment under this contract 
shall execute and deliver:
    (1) An assignment to the Government in form and substance 
satisfactory to the Contracting Officer, of refunds, rebates, credits, 
or other amounts (including any interest thereon) properly allocable to 
costs for which the Contractor has been reimbursed by the Government 
under this contract, and
    (2) A release discharging the Government, its officers, agents, and 
employees from all liabilities, obligations, and claims arising out of 
or under this contract, subject only to the following exceptions:
    (i) Specified claims in stated amounts or in estimated amounts where 
the amounts are susceptible to exact statement by the Contractor;
    (ii) Claims, together with reasonable expenses incidental thereto, 
based upon liabilities of the Contractor to third parties arising out of 
the performance of this contract; Provided, That such claims are not 
known to the Contractor on the date of the execution of the release; And 
provided further, That the Contractor gives notice of such claims in 
writing to the Contracting Officer not more than 6 years after the date 
of the release or the date of any notice to the Contractor that the 
Government is prepared to make final payment, whichever is earlier; and
    (iii) Claims for reimbursement of costs (other than expenses of the 
Contractor by reason of its indemnification of the Government against 
patent liability), including reasonable expenses incidental thereto, 
incurred by the Contractor under the provisions of this contract 
relating to patents.

                             (End of clause)

               Clause No. 7--Advance Payments (June 1977)

    (a) Amount of Advance. At the request of the Contractor, and subject 
to the conditions hereinafter set forth, the Government shall make an 
advance payment, or advance payments from time to time, to the 
Contractor. No advance payment shall be made (1) without the approval of 
the office administering

[[Page 178]]

advance payments (hereinafter called the ``Administering Office'' and 
designated in paragraph (k)(4) as with all advance payments theretofore 
made, shall exceed the amount stated in paragraph (k)(1) hereof; and (3) 
without a properly certified invoice or invoices.
    (b) Special Bank Account. Until all advance payments made hereunder 
are liquidated and the Administering Office approves in writing the 
release of any funds due and payable to the Contractor, all advance 
payments and all other payments under the contract shall be made by 
check payable to the Contractor, and be marked for deposit only in a 
Special Bank Account with the bank designated in paragraph (k)(2) 
hereof. No part of the funds in the Special Bank Account shall be 
mingled with other funds of the Contractor prior to withdrawal thereof 
from the Special Bank Account as hereinafter provided. Except as 
hereinafter provided, each withdrawal shall be made only by check of the 
Contractor countersigned on behalf of the Government by the Contracting 
Officer or such other person or persons as he/she may designate in 
writing (hereinafter called the ``Countersigning Agent''). Until 
otherwise determined by the Administering Office, countersignature on 
behalf of the Government will not be required.
    (c) Use of Funds. The funds in the Special Bank Account may be 
withdrawn by the Contractor solely for the purposes of making payments 
for items of allowable cost or to reimburse the Contractor for such 
items of allowable cost, and for such other purposes as the 
Administering Office may approve in writing. An interpretation required 
as to the proper use of funds shall be made in writing by the 
Administering Office.
    (d) Return of Funds. The Contractor may at any time repay all or any 
part of the funds advanced hereunder. Whenever so requested in writing 
by the Administering Office, the Contractor shall repay to the 
Government such part of the unliquidated balance of advance payments as 
shall in the opinion of the Administering Office be in excess of current 
requirements, or (when added to total advance previously made and 
liquidated) in excess of the amount specified in paragraph (k)(1) 
hereof. In the event the Contractor fails to repay such part of the 
unliquidated balance of advance payments when so requested by the 
Administering Office, all or any part thereof may be withdrawn from the 
Special Bank Account by checks payable to the Treasurer of the United 
States signed solely by the Countersigning Agent and applied in 
reduction of advance payments then outstanding hereunder.
    (e) Liquidation. If not otherwise liquidated, the advance payments 
made hereunder shall be liquidated as herein provided. When the sum of 
all payments under this contract, other than advance payments, plus the 
unliquidated amount of advance payments are equal to the total estimated 
cost for the work under this contract or such lesser amount to which the 
total estimated cost under this contract may have been reduced, plus 
increases, if any, in this total estimated cost not exceeding, in the 
aggregate (including, without limitation, reimbursable costs incident to 
termination for cause and retrocession as estimated by the Contracting 
Officer), the Government shall thereafter withhold further payments to 
the Contractor and apply the amounts withheld against the Contractor's 
obligation to repay such advance payments until such advance payments 
shall have been fully liquidated. If upon completion, termination, or 
retrocession of the contract all advance payments have not been fully 
liquidated, the balances therefor shall be deducted from any sums 
otherwise due or which may become due to the Contractor from the 
Government, and any deficiency shall be paid by the Contractor to the 
Government upon demand.
    (f) Bank Agreement. Before an advance payment is made hereunder, the 
Contractor shall transmit to the Administering Office, in the form 
prescribed by such office, an Agreement in triplicate from the bank in 
which the Special Bank Account is established, clearly setting forth the 
special character of the account and the responsibilities of the bank 
thereunder. Wherever possible, such bank shall be a member bank of the 
Federal Reserve System, or an ``insured'' bank within the meaning of the 
Act creating the Federal Deposit Insurance Corporation Act of August 23, 
1935, 49 Stat. 685, as amended (12 U.S.C. 264).
    (g) Lien on Special Bank Account. The Government shall have a lien 
upon any balance in the Special Bank Account paramount to all other 
liens, which lien shall secure the repayment of any advance payments 
made hereunder.
    (h) Lien on Property Under Contract. Any and all advance payments 
made under this contract shall be secured, when made, by a lien in favor 
of the Government, paramount to all other liens, upon the supplies or 
other things covered by this contract and on all material and other 
property acquired for or allocated to the performance of this contract, 
except to the extent that the Government by virtue of any other 
provision of this contract, or otherwise, shall have valid title to such 
supplies, materials, or other property as against other creditors of the 
Contractor. The Contractor shall identify, by marking or segregation, 
all property which is subject to a lien in favor of the Government by 
virtue of any provision of this contract in such a way as to indicate 
that it is subject to such lien and that it has been acquired for or 
allocated to the performance of this contract. If for any reason such 
supplies,

[[Page 179]]

materials, or other property are not identified by marking or 
segregation, the Government shall be deemed to have a lien to the extent 
of the Government's interest under this contract on any mass of property 
with which such supplies, materials, or other property are commingled. 
The Contractor shall maintain adequate accounting control over such 
property on its books and records. If at any time during the progress of 
the work on the contract it becomes necessary to deliver any item or 
items and materials upon which the Government has a lien as aforesaid to 
a third person, the Contractor shall notify such third person of the 
lien herein provided and shall obtain from such third person a receipt, 
in duplicate, acknowledging, inter alia, the existence of such lien. A 
copy of each receipt shall be delivered by the Contractor to the 
Contracting Officer. If this contract is terminated in whole or in part 
and the Contractor is authorized to sell or retain termination inventory 
acquired for or allocated to this contract, such sale or retention shall 
be made only if approved by the Contracting Officer, which approval 
shall constitute a release to the Government's lien hereunder to the 
extent that such termination inventory is sold or retained, and to the 
extent that the proceeds of the sale, or the credit allowed for such 
retention on the Contractor's termination claim, is applied in reduction 
of advance payments then outstanding hereunder.
    (i) Insurance. The Contractor represents and warrants that it is now 
maintaining with responsible insurance carriers, (1) insurance upon its 
own plant and equipment against fire and other hazards to the extent 
that like properties are usually insured by others operating plants and 
properties of similar character in the same general locality; (2) 
adequate insurance against liability on account of damage to persons or 
property; and (3) adequate insurance under all applicable workmen's 
compensation laws. The Contractor agrees that, until work under this 
contract has been completed and all advance payments made hereunder have 
been liquidated, it will (i) maintain such insurance; (ii) maintain 
adequate insurance upon any materials, parts, assembles, subassemblies, 
supplies, equipment and other property acquired for or allocable to this 
contract and subject to the Government lien hereunder; and (iii) furnish 
such certificates with respect to its insurance as the Administering 
Office may from time to time require.
    (j) Prohibition Against Assignment. Notwithstanding any other 
provision of this contract, the Contractor shall not transfer, pledge, 
or otherwise assign this contract, or any interest therein, or any claim 
arising thereunder, to any party or parties, bank, trust company, or 
other financing institution.
    (k) Designations and Determinations. (1) Amount. The amount of 
advance payments at any time outstanding hereunder shall not exceed $--
------.
    (2) Depository. The bank designated for the deposit of payments made 
hereunder shall be:
    (3) Interest Charge. No interest shall be charged for advance 
payments made hereunder. The Contractor shall charge interest at the 
rate of 6 percent per annum on subadvances or down payments to 
subcontractors, and such interest will be credited to the account of the 
Government. However, interest need not be charged on subadvances on 
nonprofit subcontracts with nonprofit educational or research 
institutions for experimental, research or development work.
    (4) Administering Office. The office administering advance payments 
shall be the office designated as having responsibility for awarding the 
contract.
    (l) Other Security. The terms of this contract shall be considered 
adequate security for advance payments hereunder, except that if at any 
time the administering office deems the security furnished by the 
Contractor to be inadequate, the Contractor shall furnish such 
additional security as may be satisfactory to the administering office, 
to the extent that such additional security is available.

                             (End of clause)

            Clause No. 8--Examination of Records (June 1977)

    (a) This clause is applicable if the amount of this contract exceeds 
$2,500 and was entered into by means of negotiation including small 
business restricted advertising, but is not applicable if this contract 
was entered into by means of formal advertising.
    (b) The Contractor agrees that the Comptroller General of the United 
States and the Secretary, or any of their duly authorized 
representatives, shall until expiration of 3 years after final payment 
under this contract or of the time period for the particular records in 
Part 1-20 of the Federal Procurement Regulations (41 CFR Part 1-20) 
whichever expires earlier, have access to and the right to examine any 
directly pertinent books, documents, papers, and records of the 
Contractor involving transactions related to this contract.
    (c) The Contractor further agrees to include in all its subcontracts 
hereunder a provision to the effect that the subcontractor agrees that 
the Comptroller General of the United States, or his/her duly authorized 
representatives shall, until expiration of 3 years after final payment 
under the subcontract or of the time periods for the particular records 
specified in Part 1-20 of the Federal Procurement Regulations (41 CFR

[[Page 180]]

Part 1-20) whichever expires earlier, have access to and the right to 
examine any directly pertinent books, documents, papers, and records of 
such subcontractor, involving transactions related to the subcontract. 
The term ``subcontract'' as used in this clause excludes (1) purchases 
orders not exceeding $2,500 and (2) subcontracts or purchase orders for 
public utility services at rates established for uniform applicability 
to the general public.
    (d) The periods of access and examination described in (b) and (c) 
above, for records which relate to (1) appeals under the ``Disputes'' 
clause of this contract, (2) litigation or the settlement of claims 
arising out of the performance of this contract, or (3) costs and 
expenses of this contract as to which exception has been taken by the 
Comptroller General or any of his/her duly authorized representatives, 
shall continue until such appeals, litigation, claims, or exceptions 
have been disposed of.

                             (End of clause)

            Clause No. 9--Inspection and Reports (June 1977)

    (a) Inspection of work. The Government shall have the right to 
inspect the work and activities under this contract, including without 
limitation, premises where any Government property may be located at 
such reasonable times and in such manner as it may deem appropriate and 
the Contractor shall afford the Government proper facilities and 
assistance for such inspection.
    (b) Reports. The Contractor shall furnish such progress reports, 
schedules, financial and cost reports, and other reports, concerning the 
work under this contract as specified elsewhere in this contract. Cost 
and other financial data and projections furnished pursuant to this 
paragraph (b) shall not relieve the Contractor of the requirements for 
furnishing notice specified in the clause of this contract entitled 
``Limitation of Cost.''
    (c) In addition, where Federal financial assistance is involved in 
the contract effort, the following clause will apply:

                      Reports to the Indian People

    The contractor, as a recipient of Federal financial assistance, 
shall make reports and information available to the Indian people served 
or represented by the contractor. Such reports will reflect how the 
Federal assistance funds were utilized to the benefit of the Indian 
people served or represented as follows: (specific reporting 
requirements, formats and methods of distribution to the Indian people 
will be prescribed in the scope of the contract.)
    (d) Annual Reporting.
    (1) For each fiscal year during which a tribal organization receives 
or expends funds pursuant to a contract under this Part, the tribe which 
requested the contract must submit a report to the Contracting Officer. 
The report shall include, but not be limited to, an accounting of the 
amounts and purposes for which the contract funds were expended and 
information on the conduct of the program or services involved. The 
reports shall include any other information requested by the Contracting 
Officer and may be submitted as follows:
    (i) When the contract is with the governing body of an Indian tribe, 
the tribe shall submit the report to the Contracting Officer.
    (ii) When the contract is with a tribal organization other than the 
governing body of the tribe, the tribe has the option of having the 
tribal organization prepare the report and submit it to the tribe for 
review and approval before the tribe submits it to the Contracting 
Officer.
    (iii) When the contract benefits more than one tribe, the tribal 
organization shall prepare and submit the report to each of the tribes 
benefiting under the contract. Each tribe shall endorse the report 
before submitting it to the Contracting Officer.
    (2) The annual report shall be submitted to the Contracting Officer 
within 90 days of the end of the fiscal year in which the contract was 
performed. However, the period for submitting the report may be extended 
if there is just cause for such extension.
    (3) In addition to the yearly reporting requirement given in 
paragraphs (a) and (b) of this section, the tribal contractor shall 
furnish other reports when and as required by the Secretary.

                             (End of clause)

                Clause No. 10--Subcontracting (June 1977)

    (a) Prior approval required. Except as provided in (c) below, the 
Contractor shall not enter into any subcontract or purchase order not 
otherwise expressly authorized elsewhere in this contract without the 
prior written approval of the Contracting Officer and subject to such 
conditions as the Contracting Officer may require.
    (b) Request for approval. The Contractor's request for approval to 
enter into a subcontract pursuant to this clause shall include: (1) A 
description of the supplies or services to be called for by the 
subcontract; (2) identification of the proposed subcontractor and an 
explanation of why and how the proposed subcontractor was selected, 
including the degree of competition obtained; (3) the proposed 
subcontract price, together with the Contractor's cost or price analysis 
thereof; (4) identification of the type of subcontract to be used; (5) a 
copy or draft of the proposed subcontract, if available; and (6) any 
other information which the Contracting Officer may require.

[[Page 181]]

    (c) Certain purchases of property and services. Prior written 
approval shall not be required for firm fixed-price subcontracts for the 
purchase or rental of items of personal property having a unit 
acquisition cost of less than $200 or for subcontracts in a total amount 
less than $1,000 unless otherwise specified elsewhere in this contract: 
Provided, however, That advance notification shall be given by the 
Contractor of any subcontract which exceeds in dollar amount 5 percentum 
of the total estimated cost of this contract.
    (d) Contractor's procurement system. The contractor shall use 
methods, practices or procedures in subcontracting or purchasing 
(hereinafter referred to as the Contractor's ``procurement system'') 
acceptable to the Contracting Officer. The Contracting Officer may, at 
any time during the performance of this contract, require the Contractor 
to provide information concerning its procurement system.
    (e) Effect of subcontracting. Subcontracts shall be made in the name 
of the Contractor and shall not bind nor purport to bind the Government. 
The making of subcontracts hereunder shall not relieve the Contractor of 
any requirement under this contract (including, but not limited to, the 
duty to properly supervise and coordinate the work of subcontracts, and 
the duty to maintain and account for property pursuant to the clause of 
this contract entitled ``Government Property''). Approval of the 
provisions of any subcontract by the Contracting Officer shall not be 
construed to constitute a determination of the allowability of any cost 
under this contract, unless such approval specifically provides that it 
constitutes a determination of the allowability of such cost. In no 
event shall approval of any subcontract by the Contracting Officer be 
construed as effecting any increase in the estimated cost set forth in 
this contract. No subcontract placed under this contract shall provide 
for payment on a cost-plus-a-percentage-of-cost basis.
    (f) Procurements from contractor-controlled sources. Procurement or 
transfer of equipment, materials, supplies, or services from contractor-
controlled source (any division or other organizational component of the 
prime contractor, exclusive of the contracting component, and any 
subsidiary or affiliate of the Contractor under a common control) shall 
be considered a subcontract for the purpose of this clause.

                             (End of clause)

         Clause No. 11--Accounts, Audit and Records (June 1977)

    (a) The Contractor shall maintain books, records, documents, and 
other evidence, accounting procedures, and practices, sufficient to 
reflect properly all direct and indirect costs of whatever nature 
claimed to have been incurred and anticipated to be incurred for the 
performance of this contract. The foregoing constitutes ``records'' for 
the purposes of this clause.
    (b) The Contractor's facility(ies), or such part thereof as may be 
engaged in the performance of this contract, and its records shall be 
subject at all reasonable times to inspection and audit by the 
Contracting Officer or his/her authorized representative.
    (c) The contractor shall preserve and make available its records (1) 
until the expiration of 3 years from the date of final payment under 
this contract, or the time periods for the particular records specified 
in (41 CFR Part 1-20), whichever expires earlier and (2) for such longer 
period, if any, as is required by applicable statute, or by other clause 
of this contract, or by (i) or (ii) below.
    (i) If this contract is completely or partially retroceded or 
reassumed by the Government, the records relating to the work terminated 
shall be preserved and made available for a period of 3 years from the 
date of any resulting final settlement.
    (ii) Records which relate to (A) appeals under the ``Disputes'' 
clause of this contract, (B) litigation or the settlement of claims 
arising out of the performance of this contract, or (C) costs and 
expenses of this contract to which exception has been taken by the 
Contracting Officer or any of his/her duly authorized representatives, 
shall be retained until such appeals, litigation, claims, or exceptions 
have been disposed of.
    (d) The Contractor shall insert the substance of this clause, 
including this paragraph (d), in each subcontract hereunder that is not 
firm fixed-price or fixed-price with escalation. When so inserted, 
changes shall be made to designate the higher-tier subcontractor at this 
level involved in place of the Contractor: to add ``of the Government 
prime contract'' in place of ``this contract'' in (B) of subparagraph 
(c)(ii) above.

                             (End of clause)

             Clause No. 12--Government Property (June 1977)

    (a) Government furnished property. (1) The Government reserves the 
right to furnish any property or services required for the performance 
of the work under this contract.
    (2) The Government shall deliver to the Contractor, for use in 
connection with and under the terms of this contract, the property 
described elsewhere in this contract, together with such related data 
and information as the Contractor may request and as may reasonably be 
required for the intended use of such property (such property to be 
referred to as ``Government furnished property'').
    In the event that Government furnished property is not delivered to 
the contractor

[[Page 182]]

by the time or times as stated, or if not stated, in sufficient time to 
enable the Contractor to meet such delivery or performance dates under 
this contract, the Contracting Officer shall, upon timely written 
request made by the Contractor, make a determination of the delay 
occasioned the Contractor and make appropriate equitable adjustments to 
any contractual provisions affected by any such delay in accordance with 
the provisions of the clause of this contract entitled ``Changes.''
    In the event that Government furnished property is received by the 
Contractor in a condition not suitable for the intended use, the 
Contractor shall, immediately upon receipt thereof, notify the 
Contracting Officer of such fact, and, as directed by the Contracting 
Officer either (i) return or otherwise dispose of such property, or (ii) 
effect repairs or modifications thereto. Upon completion of (i) or (ii) 
above, the Contracting Officer, upon timely written request of the 
Contractor, shall make appropriate equitable adjustments to any 
contractual provisions affected thereby in accordance with the 
provisions of the clause of this contract entitled ``Changes.'' The 
foregoing provisions for adjustment are exclusive and the Government 
shall not be liable to suit for breach of contract by reason of any 
delay in delivery of Government furnished property or delivery of such 
property in a condition not suitable for its intended use.
    (b) Title. (1) Title to all property furnished by the Government 
shall remain in the Government. Title to all property purchased by the 
Contractor, the cost of which the Contractor is entitled to be 
reimbursed as a direct item of cost under this contract, shall pass to 
and vest in the Government upon delivery of such property by the vendor. 
Title to other property, the cost of which is reimbursable to the 
Contractor under this contract, shall pass and vest in the Government 
upon (i) issuance for use of such property in the performance of this 
contract, or (ii) commencement of processing or use of such property in 
the performance of this contract, or (iii) reimbursement of the cost 
thereof by the Government in whole or in part, whichever first occurs. 
All Government furnished property, together with all property acquired 
by the Contractor, title to which vests in the Government under this 
paragraph, are subject to the provisions of this clause and are 
hereinafter collectively referred to as ``Government property.''
    (2) Title to the Government property shall not be affected by the 
incorporation or attachment thereof to any property now owned by the 
Government, nor shall such Government property, or any part thereof, be 
or become a fixture or lose its identity or personality by reason of 
affixation to any realty.
    (c) Use of Government property. Government property shall, unless 
otherwise provided herein or approved by the Contracting Officer, be 
used only for the performance of this contract.
    (d) Property management and control. The Contractor shall maintain 
and administer in accordance with sound business practice a program for 
the maintenance repair, protection, and preservation, control of and 
accountability for Government property, so as to assure its full 
availability and usefulness for the performance of this contract. The 
Contractor shall comply with Federal, State, and local laws, codes, 
ordinances, regulations, and orders pertaining to standards of 
construction, safety, environment quality, energy conservation, historic 
site preservation, facilities for the handicapped, emergency 
preparedness, and other requirements that are applicable to the physical 
characteristics, operation, and maintenance of Government property. The 
Contractor agrees to promptly receipt for all Government property in a 
form and manner as prescribed by the Contracting Officer. The Contractor 
further agrees to take all reasonable steps to comply with all 
directions or instructions which the Contracting Officer may prescribe 
regarding the management and control of Government property.
    (e) Risk or loss. (1) The Contractor shall not be liable for any 
loss of or damage to Government property, or for expenses incidental to 
such loss or damage, except that the Contractor shall be responsible for 
any such loss or damage (including expenses incidental thereto);
    (i) Which results from willful misconduct or lack of good faith on 
the part of any of the Contractor's directors or officers, or on the 
part of any of its managers, superintendents, or other equivalent 
representatives, who have supervision or direction of
    (A) all or substantially all of the Contractor's operations at any 
one plant, laboratory or separate location in which this contract is 
being performed or
    (B) a separate and complete major organization, industrial or 
otherwise in connection with the performance of this contract;
    (ii) Which results from a failure on the part of the Contractor, due 
to willful misconduct or lack of good faith on the part of any of its 
directors, officers, or other representatives mentioned in subparagraph 
(i) above, (A) to maintain and administer, in accordance with sound 
business practice, the program for maintenance, repair, protection, and 
preservation of Government property as required by paragraph (d) hereof, 
or (B) to take all reasonable steps to comply with any appropriate 
written directions of the Contracting Officer under paragraph (4) 
hereof;
    (iii) For which the Contractor is otherwise responsible under the 
express terms of this contract;
    (iv) Which results from a risk expressly required to be insured 
under this contract, but

[[Page 183]]

only to the extent of the insurance so required to be procured and 
maintained, or to the extent of insurance actually procured and 
maintained, whichever is greater; or
    (v) Which results from a risk which is in fact covered by insurance 
or for which the Contractor is otherwise reimbursed, but only to the 
extent of such insurance or reimbursement; Provided That, if more than 
one of the above exceptions shall be applicable in any case, the 
Contractor's liability under any one exception shall not be limited by 
any other exception.
    (2) If the Contractor transfers Government property to the 
possession and control of a subcontractor the transfer shall not affect 
the liability of the Contractor for loss or destruction of or damage to 
Government property as set forth in (1) above. The Contractor shall 
require the subcontractor to assume the risk of and be responsible for 
any loss or destruction of or damage to Government property while in the 
latter's possession or control, and the subcontract shall contain 
appropriate provisions requiring the return of all Government property 
in as good condition as when received (except for reasonable wear and 
tear or for the utilization of the property in accordance with the 
provisions of this contract). Provided, however, That the subcontractor 
may be relieved from such liability only to the extent that the 
subcontract, with the prior approval of the Contracting Officer, so 
provides.
    (3) The Contractor shall not be reimbursed for, and shall not 
include as an item of overhead, the cost of insurance, or any provisions 
for a reserve, covering the risk of loss or damage to the Government 
property, except to the extent that the Government may have required the 
Contractor to carry such insurance under any other provision of this 
contract.
    (4) Upon the happening of loss or destruction of or damage to the 
Government property, the Contractor shall notify the Contracting Officer 
thereof, and shall take all reasonable steps to protect the Government 
property from further damage, separate the damaged and undamaged 
Government property, put all the Government property in the best order, 
and furnish to the Contracting Officer a statement of:
    (i) The lost, destroyed, and damaged Government property;
    (ii) The time and origin of the loss, destruction or damage;
    (iii) All known interests in commingled property of which the 
Government property is a part; and
    (iv) The insurance, if any, covering any part of or interest in such 
commingled property.

The Contractor shall make repairs and renovation of the damaged 
Government property, or take such other actions as the Contracting 
Officer directs.
    (5) In the event the Contractor is indemnified, reimbursed, or 
otherwise compensated for any loss or destruction of or damage to the 
Government property, it shall use the proceeds to repair, renovate, or 
replace the Government property involved, or shall credit such proceeds 
against the cost of the work covered by the contract, or shall otherwise 
reimburse the Government, as directed by the Contracting Officer. The 
loss, destruction or damage and, upon the request of the Constracting 
Officer, shall, at the Government's expense, furnish to the Government 
all reasonable assistance and cooperation (including assistance in the 
prosecution of suit and the execution of instruments of assignment in 
favor of the Government) in obtaining recovery. In addition, where a 
subcontractor has not been relieved from liability for any loss or 
destruction of or damage to Government property, the Contractor shall 
enforce the liability of the subcontractor for such loss or destruction 
of or damage to the Government property for the benefit of the 
Government.
    (f) Disposition of Government property.
    (1) During the period of performance of this contract, the 
Contractor shall promptly and regularly report to the Contracting 
Officer, in such form and manner as the Contracting Officer may direct, 
concerning the status of Government property under the contract, 
including all Government property in the Contractor's possession which 
is not in use or which is excess to the needs of the contract. The 
Contractor shall make such disposition of Government property as the 
Contracting Officer may direct. The Contractor shall in no way be 
relieved of responsibility for Government property without the prior 
written approval of the Contracting Officer.
    (2) Upon completion or expiration of this contract, or at such 
earlier date as may be fixed by the Contracting Officer, the Contractor 
shall render an accounting, as prescribed by the Contracting Officer, of 
all Government property which had come into the possession or custody of 
the Contractor under this contract. Such accounting shall include 
inventory schedules covering all items of Government property not 
consumed in the performance of this contract, or not theretofore 
delivered to the Government, or for which the Contractor has not 
otherwise been relieved of responsibility. The Contractor shall deliver 
or make such other disposition of Government property covered in such 
inventory schedules as the Contracting Officer may direct.
    (3) The net proceeds of any disposition of Government property, in 
accordance with (1) and (2) above, shall be credited to the cost of the 
work covered by the contract or shall be paid in such manner as the 
Contracting Officer may direct.
    (g) Restoration of premises. Unless otherwise provided herein, the 
Government shall not be

[[Page 184]]

under any duty or obligation to restore or rehabilitate, or to pay the 
costs of the restoration or rehabilitation of the Contractor's facility 
or any portion thereof which is affected by removal of any Government 
property.

                             (End of clause)

                   Clause No. 13--Changes (June 1977)

    The Contracting Officer may at any time, with the consent of the 
Contractor, by a written order, and without notice to the sureties, if 
any, make changes, within the general scope of this contract, in any one 
or more of the following: (a) Drawings, designs, or specifications; (b) 
method of shipment or packing; (c) place of inspection, delivery, or 
acceptance; and (d) the amount of Government furnished property. If any 
such change causes an increase or decrease in the estimated cost of, or 
the time required for performance of this contract, or otherwise affects 
any other provisions of this contract, whether changed or not by any 
such order, an equitable adjustment shall be made (a) in the estimated 
cost or delivery schedule, or both, and (b) in such other provisions of 
the contract as may be so affected, and the contract shall be modified 
in writing accordingly. Any claim by the Contractor for adjustment under 
this clause must be asserted within thirty (30) days from the date of 
receipt by the Contractor of the notification of change: Provided, 
however, That the Contracting Officer, if he/she decides that the facts 
justify such action, may receive and act upon any such claim asserted at 
any time prior to final payment under this contract. Where the cost of 
property made obsolete or excess as a result of a change is included in 
the Contractor's claim for adjustment, the Contracting Officer shall 
have the right to prescribe the manner of disposition of such property. 
Failure to agree to any adjustment shall be a dispute concerning a 
question of fact within the meaning of the clause of this contract 
entitled ``Disputes.'' However, nothing in this clause shall excuse the 
Contractor from proceeding with the contract as changed.

                             (End of clause)

      Clause No. 14--Notice to the Government of Delays (June 1977)

    Whenever the Contractor has knowledge that any actual or potential 
situation, including, but not limited to, labor disputes, is delaying or 
threatens to delay the timely performance of the work under this 
contract, the Contractor shall immediately give written notice thereof, 
including all relevant information with respect thereto, to the 
Contracting Officer.

                             (End of clause)

                 Clause No. 15--Retrocession (June 1977)

    (a) The Indian Tribe that initially requested this contract may also 
request its retrocession, notwithstanding the fact that the Contractor 
may be a tribal organization other than the Tribe.
    (b) Should the Tribe request retrocession of the contract and the 
Contractor is other than the Tribe, the Contracting Officer will notify 
the Contractor of the request and in consultation with the Tribe and the 
Contractor establish the effective date of the retrocession. The 
retrocession will become effective no later than 120 days after the 
Contracting Officer receives the Tribe's request unless the Tribe and 
the Contracting Officer mutually agree on a later date.
    (c) Immediately after receipt of the request for retrocession and 
where applicable notifying the Contractor, the Contracting Officer will 
meet with the Contractor and, where applicable, the tribal governing 
body or bodies, mutually agree to:
    (1) A plan for the orderly transfer of responsibilities;
    (2) A plan for inventorying materials and supplies on hand;
    (3) An accounting for funds, including but not limited to current 
and anticipated obligations;
    (4) The cost of operation until retrocession; and,
    (5) The identification of all records relating to the contract and 
the contracted function.

                             (End of clause)

 Clause No. 16--Assumption and Reassumption of Contract Programs (June 
                                  1977)

    (a) When the Director or his/her delegate determines that the 
performance of a Contractor under these regulations involves (1) the 
violation of the rights or endangerment of the health, safety, or 
welfare of any persons, or (2) gross negligence or the mismanagement in 
the handling or use of funds under the contract, he/she will, in 
writing, notify the contractor of such determinations and will request 
that the Contractor take such corrective action within such period of 
time as the Director or his/her delegate may prescribe.
    (b) When the Director or his/her delegate determines that a 
Contractor has not taken corrective action (as prescribed by him/her 
under paragraph (a) of this section) to his/her satisfaction, he/she 
may, after the Contractor has been provided an opportunity for a hearing 
in accordance with paragraph (c) of this section, rescind the contract 
in whole or in part and, if he/she deems it appropriate, assume or 
resume control or operation of the program, activity, or service 
involved.

[[Page 185]]

    (c)(1) When the Director or his/her delegate has made a 
determination described in paragraph (b) of this section, he/she shall 
in writing notify the Contractor of such determination and of the 
Contractor's right to request a review of such determination and of the 
determination described in paragraph (a) of this section. Such 
notification by the Director or his/her delegate shall set forth the 
reasons for the determination in sufficient detail to enable the 
Contractor to respond and shall inform the Contractor of its right to a 
hearing on the record before a Contract Appeals Board described in 
paragraph (d) of this section. Upon the request of the Contractor for a 
hearing, the Board, established pursuant to paragraph (d) of this 
section shall in writing within 10 days of the establishment notify the 
Contractor of the time, place and date of the hearing which will be held 
not later than 45 days after the request for a hearing.
    (2) Where the Director or his/her delegate determines that a 
Contractor's performance under a contract awarded under this subpart 
poses an immediate threat to the safety of any person, he/she may 
immediately rescind the contract in whole or in part and, if he/she 
deems it appropriate, assume or resume control or operation of the 
program, activity, or service involved. Upon such a decision he/she will 
immediately notify the Contractor of such action and the basis therefor; 
and offer the Contractor an opportunity for a hearing on the record 
before the Contract Appeals Board established pursuant to paragraph (d) 
of this section to be held within 10 days of each action.
    (d)(1) The Contract Appeals Board shall be composed of 3 persons 
appointed by the Director, Indian Health Service. Such persons may not 
be selected from the immediate office of any person participating in the 
determination at issue. The Board shall afford the Contractor the right:
    (i) To notice of the issues to be considered;
    (ii) To be represented by counsel;
    (iii) To present witnesses on Contractor's behalf;
    (iv) To cross-examine other witnesses either orally or through 
written interrogatories; and
    (v) To compel the appearance of Indian Health Service personnel or 
to take depositions of such persons at reasonable times and places.
    (2) The Contract Appeals Board shall make an initial written 
decision which shall become final within 20 days unless the Director, 
Indian Health Service or his/her representative modifies or reverses the 
decision. Any such decision by the Director of the Indian Health Service 
or his/her representative shall be in writing, shall be specific as to 
the reasons for such decision, and shall be considered final.
    (3) Where the Board is considering issues arising under paragraph 
(2) of this section, the Board shall within 25 days after the conclusion 
of the hearing, notify all parties in writing of its decision.
    (c) In any case where the officer has rescinded a contract under 
paragraph (b) or (c) of this section, he/she may decline to enter into a 
new contract agreement with the Contractor until such time as he/she is 
satisfied that the basis for the recision has been corrected.
    Nothing in this section shall be construed as contravening the 
Occupational Safety and Health Act of 1970 (84 Stat. 1590), as amended 
(29 U.S.C. 651).

                             (End of clause)

                Clause No. 17--Key Personnel (June 1977)

    Where ``key personnel'' have been identified in this contract, it 
has been determined that such named personnel are necessary for the 
successful performance of the work under this contract; and the 
Contractor agrees to assign such personnel to the performance of the 
work under this contract, and shall not reassign or remove any of them 
without the consent of the Contracting Officer. Whenever, for any 
reason, one or more of the aforementioned personnel is unavailable for 
assignment for work under the contract, the Contractor shall immediately 
notify the Contracting Officer to that effect and shall, subject to the 
approval of the Contracting Officer without formal modification to the 
contract, replace such personnel with personnel of substantially equal 
ability and qualifications.

                             (End of clause)

            Clause No. 18--Litigation and Claims (June 1977)

    The Contractor shall give the Contracting Officer immediate notice 
in writing of (a) 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 (b) any claim against the 
Contractor the cost and expense of which is allowable under the clause 
entitled ``Allowable Cost,'' 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 (a) 
effect an assignment and subrogation in favor of the Government of

[[Page 186]]

all the Contractor's rights and claims (except those against the 
Government) arising out of any such action or claim against the 
Contractor; and (b) 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 cost 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)

           Clause No. 19--Indemnity and Insurance (June 1977)

    (a) The Contractor shall indemnify and save and keep harmless the 
Government against any or all loss, cost, damage, claim, expense or 
liability whatsoever, because of accident or injury to persons or 
property or others occurring in connection with any program included as 
a part of this contract, by providing where applicable, the insurance 
described below:
    (b) The Contractor shall secure, pay the premium for, and keep in 
force until the expiration of this contract, or any renewal period 
thereof, insurance as provided below. Such insurance policies shall 
specifically include a provision stating the liability assumed by the 
Contractor under this contract.
    (1) Workman's compensation insurance as required by laws of the 
state.
    (2) Owner's, landlord's, and tenant's bodily injury liability 
insurance with limits of not less than $50,000 for each person and 
$500,000 for each accident.
    (3) Property damage liability insurance with limits of not less than 
$25,000 for each accident.
    (4) Automobile bodily injury liability insurance with limits of not 
less than $50,000 for each person, and $500,000 for each accident and 
property damage liability insurance with a limit of not less than $5,000 
for each accident.
    (5) Food products liability insurance with limits of not less than 
$50,000 for each person and $500,000 for each accident.
    (6) Professional malpractice insurance where medical, dental and 
other health professional services are involved.
    (7) Other liability insurance not specifically mentioned when 
required.
    (c) Each policy of insurance shall contain an endorsement providing 
that cancellation by the insurance company shall not be effective unless 
a copy of the cancellation is mailed (registered) to the Contracting 
Officer 30 days prior to the effective date of cancellation.
    (d) A certificate of each policy of insurance, and any change 
therein, shall be furnished to the Contracting Officer immediately upon 
receipt from the insurance company.
    (e) Insurance companies of the Contractor shall be satisfactory to 
the Contracting Officer. When in his/her opinion an insurance company is 
not satisfactory for reasons that will be stated, the Contractor shall 
provide insurance through companies that are satisfactory to the 
Contracting Officer.
    (f) Each policy of insurance shall contain a provision that the 
insurance carrier waives any rights it may have to raise as a defense 
the tribe's sovereign immunity from suit, but such waivers shall extend 
only to claims the amount and nature of which are within the coverage 
and limits of the policy of insurance. The policy shall contain no 
provision, either expressed or implied, that will serve to authorize or 
empower the insurance carrier to waive or otherwise limit the tribe's 
sovereign immunity outside or beyond the coverage and limits of the 
policy insurance.

                             (End of clause)

                   Clause No. 20--Overtime (June 1977)

    Except as provided in this contract, the Contractor shall not 
perform overtime work under or in connection with this contract for 
which premium compensation is required to be paid, without specific 
written approval from the Contracting Officer.

                             (End of clause)

                Clause No. 21--Foreign Travel (June 1977)

    Foreign travel shall not be performed without the prior written 
approval of the Contracting Officer. As used in this clause ``Foreign 
Travel'' means travel outside the United States, its Territories and 
Possessions, and Canada.

[[Page 187]]

                             (End of clause)

          Clause No. 22--Questionnaire and Surveys (June 1977)

    In the event the performance of this contract involves the 
collection of information upon identical items from 10 or more persons, 
other than Federal employees, the Contractor shall obtain written 
approval from the Contracting Officer, prior to the use thereof, of any 
forms, schedules, questionnaires, survey plans or other documents, and 
any revisions thereto, intended to be used in such collection.

                             (End of clause)

                   Clause No. 23--Printing (June 1977)

    Unless otherwise specified in this contract, the Contractor shall 
not engage in, nor subcontract for, any printing (as that term is 
defined in Title I of the Government Printing and Binding Regulations in 
effect on the effective date of this contract) in connection with the 
performance of work under this contract; Provided, however, That 
performance of a requirement under this contract involving the 
reproduction of less than 5,000 production units of any one page or less 
than 25,000 production units in the aggregate of multiple pages, will 
not be deemed to be printing. A production unit is defined as one sheet, 
size 8 by 10 and \1/2\ inches, one side only, one color.

                             (End of clause)

           Clause No. 24--Services of Consultants (June 1977)

    Except as otherwise expressly provided elsewhere in this contract, 
and notwithstanding the provisions of the clause of this contract 
entitled ``Subcontracting,'' the prior written approval of the 
Contracting Officer shall be required:
    (a) Whenever any employee of the Contractor is to be reimbursed as a 
``consultant'' under this contract; and
    (b) For the utilization of the services of any consultant under this 
contract exceeding the daily rate set forth elsewhere in this contract 
or, if no amount is set forth, $100, exclusive of travel costs or where 
the services of any consultant under this contract will exceed 10 days 
in any calendar year. Whenever Contracting Officer approval is required, 
the Contractor will obtain and furnish to the Contracting Officer 
information concerning the need for such consultant services and the 
reasonableness of the fees to be paid, including but not limited to, 
whether fees to be paid to any consultant exceed the lowest fee charged 
by such consultant to others for performing consultant services of a 
similar nature.

                             (End of clause)

             Clause No. 25--Assignment of Claims (June 1977)

    (a) Pursuant to the provisions of the Assignment of Claims Act of 
1940, as amended (31 U.S.C. 203, 41 U.S.C. 15), if this contract 
provides for payments aggregating $1,000 or more, claims for moneys due 
or to become due the Contractor from the Government under this contract 
may be assigned to a bank, trust company, or other financing 
institution, including any Federal lending agency, and may thereafter be 
further assigned and reassigned to any such institution. Any such 
assignment or reassignment shall cover all amounts payable under this 
contract and not already paid, and shall not be made to more than one 
party, except that any such assignment or reassignment may be made to 
one party as agent or trustee for two or more parties participating in 
such financing. Unless otherwise provided in this contract, payment to 
assignee of any moneys due or to become due under this contract shall 
not, to the extent provided in said Act, as amended, be subject to 
reduction or setoff. (The preceding sentence applies only if this 
contract is made in time of war or national emergency as defined in said 
Act and is with the Department of Defense, the General Services 
Administration, the Atomic Energy Commission, the National Aeronautics 
and Space Administration, the Federal Aviation Agency or any other 
department or agency of the United States designated by the President 
pursuant to Clause 4 of the proviso of section 1 of the Assignment of 
Claims Act of 1940, as amended by the Act of May 15, 1951, 65 Stat. 41.)
    (b) In no event shall copies of this contract or of any plans, 
specifications, or other similar documents relating to work under this 
contract, if marked ``Top Secret,'' ``Secret,'' or ``Confidential,'' be 
furnished to any assignee of any claim arising under this contract or to 
any other person not entitled to receive the same. However, a copy of 
any part or all of this contract so marked may be furnished, or any 
information contained therein may be disclosed, to such assignee upon 
the prior written authorization of the Contracting Officer.

                             (End of clause)

  Clause No. 26--Contract Work Hours and Safety Standard Act--Overtime 
                        Compensation (June 1977)

    This contract, to the extent that it is of a character specified in 
the Contract Work Hours and Safety Standards Act (40 U.S.C. 327-330), is 
subject to the following provisions and to all other applicable 
provisions and exceptions of such Act and the regulations of the 
Secretary of Labor thereunder.

[[Page 188]]

    (a) Overtime requirements. No Contractor or subcontractor 
contracting for any part of the contract work which may require or 
involve the employment of laborers or mechanics shall require or permit 
any laborer or mechanic in any workweek in which he/she is employed on 
such work to work in excess of eight hours in any calendar day or in 
excess of forty hours in such workweek on work subject to the provisions 
of the Contract Work Hours Standards Act unless such laborer or mechanic 
receives compensation at a rate not less than one and one-half times 
his/her basic rate of pay for all such hours worked in excess of eight 
hours in any calendar day or in excess of forty hours in such workweek, 
whichever is the greater number of overtime hours.
    (b) Violation; liability for unpaid wages; liquidated damages. In 
the event of any violation of the provisions of paragraph (a), the 
Contractor and any subcontractor responsible therefor shall be liable to 
any affected employee for his/her unpaid wages. In addition, such 
Contractor and subcontractor shall be liable to the United States for 
liquidated damages. Such liquidated damages shall be computed with 
respect to each individual laborer or mechanic employed in violation of 
the provisions of paragraph (a) in the sum of $10 for each calendar day 
on which such employee was required or permitted to be employed on such 
work in excess of eight hours or in excess of the standard workweek of 
forty hours without payment of the overtime wages required by paragraph 
(a).
    (c) Withholding for unpaid wages and liquidated damages. The 
Contracting Officer may withhold from the Government Prime Contractor, 
from any moneys payable on account of work performed by the Contractor 
or subcontractor, such sums as may administratively be determined to be 
necessary to satisfy any liabilities of such Contractor or subcontractor 
for unpaid wages and liquidated damages as provided in the provisions of 
paragraph (b).
    (d) Subcontracts. The Contractor shall insert paragraphs (a) through 
(d) of this clause in all subcontracts, and shall require their 
inclusion in all subcontracts for any tier.
    (e) Records. The Contractor shall maintain payroll records 
containing the information specified in 29 CFR 516.2(a). Such records 
shall be preserved for three years from the completion of the contract. 
This requirement does not apply where the tribal contractor is the 
governing body of the tribe and the work is being performed by the 
tribal contractor or the tribe with its regular employees.

                             (End of clause)

      Clause No. 27--Walsh-Healey Public Contracts Act (June 1977)

    If this contract is for the manufacture or furnishing of materials, 
supplies, articles, or equipment in an amount which exceeds or may 
exceed $10,000 and is otherwise subject to the Walsh-Healey Public 
Contracts Act, as amended (41 U.S. Code 35-45), there are hereby 
incorporated by reference all representations and stipulations required 
by said Act and regulations issued thereunder by the Secretary of Labor, 
such representations and stipulations being subject to all applicable 
rulings and interpretations of the Secretary of Labor which are now or 
may hereafter be in effect. This requirement does not apply where the 
tribal contractor is the governing body of the tribe and the work is 
being performed by the tribal contractor or the tribe with its regular 
employees.

                             (End of clause)

              Clause No. 28--Equal Opportunity (June 1977)

    Subject to the Indian preference in training and employment of 
Clause 29 during the performance of this contract, the Contractor agrees 
as follows:
    (a) The Contractor will not discriminate against any employee or 
applicant for employment because of race, creed, color, or national 
origin. The Contractor will take affirmative action to ensure that 
applicants are employed, and that employees are treated during 
employment, without regard to their race, creed, color, or national 
origin. Such action shall include, but not be limited to, the following: 
Employment, upgrading, demotion, or transfer; recruitment or recruitment 
advertising; layoff or termination; rates of pay or other forms of 
compensation; and selection for training, including apprenticeship. The 
Contractor agrees to post in conspicuous places, available to employees 
and applicants for employment, notices to be provided by the Contracting 
Officer setting forth the provisions of this Equal Opportunity clause.
    (b) The Contractor will, in all solicitations or advertisements for 
employees placed by or on behalf of the Contractor, state that all 
qualified applicants will receive consideration for employment without 
regard to race, creed, color, or national origin.
    (c) The Contractor will send to each labor union or representative 
of workers with which it has a collective bargaining agreement or other 
contract or understanding, a notice, to be provided by the agency 
Contracting Officer, advising the labor union or workers' representative 
of the Contractor's commitments under this Equal Opportunity clause, and 
shall post copies of the notice in

[[Page 189]]

conspicuous places available to employees and applicants for employment.
    (d) The Contractor will comply with all provisions of Executive 
Order No. 11246 of September 24, 1965, and the rules, regulations, and 
relevant orders of the Secretary of Labor.
    (e) The Contractor will furnish all information and reports required 
by Executive Order No. 11246 of September 24, 1965, and by the rules, 
regulations, and orders of the Secretary of Labor, or pursuant thereto, 
and will permit access to its books, records, and accounts by the 
contracting agency and the Secretary of Labor for purposes of 
investigation to ascertain compliance with such rules, regulations, and 
orders.
    (f) In the event of the Contractor's noncompliance with the Equal 
Opportunity clause of this contract or with any of the said rules, 
regulations, or orders, this contract may be cancelled, terminated, or 
suspended, in whole or in part, and the Contractor may be declared 
ineligible for further Government contracts in accordance with 
procedures authorized in Executive Order No. 11246 of September 24, 
1965, and such other sanctions may be imposed and remedies invoked as 
provided in Executive Order No. 11246 of September 24, 1965, or by rule, 
regulation, or order of the Secretary of Labor, or as otherwise provided 
by law.
    (g) The Contractor will include the provisions of paragraphs (a) 
through (g) in every subcontract or purchase order unless exempted by 
rules, regulations, or orders of the Secretary of Labor issued pursuant 
to section 204 of Executive Order No. 11246 of September 24, 1965, so 
that such provisions will be binding upon each subcontractor or vendor. 
The Contractor will take such action with respect to any subcontract or 
purchase order as the contracting agency may direct as a means of 
enforcing such provisions, including sanctions for noncompliance: 
Provided, however, That in the event the Contractor becomes involved in, 
or is threatened with, litigation with a subcontractor or vendor as a 
result of such direction by the contracting agency, the Contractor may 
request the United States to enter into such litigation to protect the 
interests of the United States.

                             (End of clause)

 Clause No. 29--Indian Preference in Training and Employment (June 1977)

    (a) The Contractor shall give preference in employment for all work 
performed under the contract, including subcontracts thereunder, to 
qualified Indians0 regardless of age, religion, or sex, and to the 
extent feasible consistent with the efficient performance of the 
contract, provide employment and training opportunities to Indians, 
regardless of age, religion, or sex, that are not fully qualified to 
perform under the contract. The Contractor shall comply with any Indian 
preference requirements established by the Tribe receiving services 
under the contract to the extent that such requirements are consistent 
with the purpose and intent of this paragraph.
    (b) If the Contractor or any of its subcontractors is unable to fill 
its employment openings after giving full consideration to Indians as 
required in paragraph (a) above, these employment openings may then be 
filled by other than Indians under the conditions set forth in the Equal 
Opportunity clause of this contract.
    (c) The Contractor agrees to include this clause or one similar 
thereto in all subcontracts issued under the contract.

                             (End of clause)

   Clause No. 30--Certificate of Nonsegregated Facilities (June 1977)

    By signing the contract the Contractor certifies that it does not 
maintain or provide for its employees any segregated facilities at any 
of its establishments, and that it does not permit its employees to 
perform their services at any location, under its control, where 
segregated facilities are maintained. It certifies further that it will 
not maintain or provide for its employees any segregated facilities at 
any of its establishments, and that it will not permit its employees to 
perform their services at any location, under its control, where 
segregated facilities are maintained. The Contractor agrees that a 
breach of this certification is a violation of the Equal Opportunity 
clause in this contract. As used in this certification, the term 
``segregated facilities'' means any waiting rooms, work areas, rest 
rooms, and wash rooms, restaurants and other eating areas, time clocks, 
locker rooms and other storage or dressing areas, parking lots, drinking 
fountains, recreation or entertainment areas, transportation, and 
housing facilities provided for employees which are segregated by 
explicit directive or are in fact segregated on the basis of race, 
color, religion, or national origin, because of habit, local custom or 
otherwise. It further agrees that (except where it has obtained 
identical certifications from proposed subcontractors for specific time 
periods) it will obtain identical certifications from proposed 
subcontractors prior to the award of subcontracts exceeding $10,000 
which are not exempt from the provisions of the Equal Opportunity 
clause; that it will retain such certifications in its files; and that 
it will forward the following notice to such proposed subcontractors 
(except where the proposed subcontractors have submitted identical 
certifications for specific time periods):

[[Page 190]]

    Notice to prospective subcontractors of requirement for 
certifications of nonsegregated facilities. A certificate of 
Nonsegregated Facilities must be submitted prior to the award of a 
subcontract exceeding $10,000 which is not exempt from the provisions of 
the Equal Opportunity clause. The certification may be submitted either 
for each subcontract or for all subcontracts during a period (i.e., 
quarterly, semiannually, or annually).

                             (End of clause)

                Clause No. 31--Convict Labor (June 1977)

    In connection with the performance of work under this contract, the 
Contractor agrees not to employ any person undergoing sentence of 
imprisonment at hard labor, except as provided by Public Law 89-176, 
September 10, 1965 (18 U.S.C. 4082(c)(2)), and Executive Order No. 
11755, December 29, 1973.

                             (End of clause)

           Clause No. 32--Officials Not To Benefit (June 1977)

    No member of or delegate to Congress, or resident commissioner, 
shall be admitted to any share or part of this contract, or to any 
benefit that may arise therefrom; but this provision shall not be 
construed to extend to this contract if made with a corporation for its 
general benefit.

                             (End of clause)

 Clause No. 33--Buy American Act for Supply and Service Contracts (June 
                                  1977)

    (a) In acquiring end products, the Buy American Act (41 U.S. Code 
10a-d) provides that the Government give preference to domestic source 
end products. For the purpose of this clause:
    (i) ``Components'' means those articles, materials, and supplies 
which are directly incorporated in the end products;
    (ii) ``End products'' means those articles, materials, and supplies 
which are to be acquired under this contract for public use; and
    (iii) A ``domestic source end product'' means (A) an unmanufactured 
end product which has been mined or produced in the United States and 
(B) an end product manufactured in the United States if the cost of the 
components thereof which are mined, produced, or manufactured in the 
United States exceeds 50 percent of the cost of all its components. For 
the purpose of this (a)(iii) (B), components of foreign origin of the 
same type or kind as the products referred to in (b) (ii) or (iii) of 
this clause shall be treated as components mined, produced or 
manufactured in the United States.
    (b) The Contractor agrees that there will be delivered under this 
contract only domestic source end products, except end products:
    (i) Which are for use outside the United States;
    (ii) Which the Government determines are not mined, produced, or 
manufactured in the United States in sufficient and reasonably available 
commercial quantities and of a satisfactory quality;
    (iii) As to which the Secretary determines the domestic preference 
to be inconsistent with the public interest; or
    (iv) As to which the Secretary determines the cost to the Government 
to be unreasonable.
    (The foregoing requirements are administered in accordance with 
Executive Order No. 10582, dated December 17, 1954).

                             (End of clause)

              Clause No. 34--Anti-Kickback Act (June 1977)

    (a) Public Law 86-695, September 2, 1960 (41 U.S.C. 51-54) among 
other things prohibits the payment, directly or indirectly, by or on 
behalf of a subcontractor in any tier under any Government negotiated 
contract of any fee, gift or gratuity to the prime contractor or any 
higher tier subcontractor or any officer, agent, partner or employee 
thereof, as an inducement or acknowledgment for the award of a 
subcontact or order.
    (b) The provisions of Public Law 86-695 are applicable to this 
contract and any subcontracts entered into under the contract.

                             (End of clause)

       Clause No. 35--Use of Indian Business Concerns (June 1977)

    (a) As used in this clause, the term ``Indian business concern'' 
means Indian organizations or an Indian-owned economic enterprise as 
defined in 42 FR 36.204(i).
    (b) The contractor agrees to give preference to qualified Indian 
business concerns in the awarding of any subcontracts entered into under 
the contract consistent with the efficient performance of the contract. 
The contractor shall comply with any preference requirements regarding 
Indian business concerns established by the Tribe(s) receiving services 
under the contract to the extent that such requirements are consistent 
with the purpose and intent of this paragraph.
    (c) If no Indian business concerns are available under the 
conditions in paragraph (b) above, the Contractor agrees to accomplish 
the maximum amount of subcontracting, as the Contractor determines is 
consistent with its efficient performance of the contract, with small 
business concerns, labor surplus area concerns or minority business 
enterprises, the definitions for which are contained in Subparts 1-1.7, 
1-1.8, and 1-1.13 of the Federal Procurement Regulations. The Contractor 
is not, however, required to establish a small business, labor surplus, 
or

[[Page 191]]

minority business subcontracting program as described in sections 1-
1.710-3(b), 1-1.805-3(b), and 1-1.1310-2(b), respectively, of the 
Federal Procurement Regulations (41 CFR Chaper 1).

                             (End of clause)

  Clause No. 36--Payment of Interest on Contractor's Claims (June 1977)

    (a) If an appeal is filed by the Contractor from a final decision of 
the Contracting Officer under the Disputes clause of this contract, 
denying a claim arising under the contract, simple interest on the 
amount of the claim finally determined owed by the Government shall be 
payable to the Contractor. Such interest shall be at the rate determined 
by the Secretary of the Treasury pursuant to P.L. 92-41, 85 Stat. 97, 
from the date the Contractor furnished to the Contracting Officer his 
written appeal under the Disputes clause of this contract, to the date 
of (1) a final judgment by a court of competent jurisdiction, or (2) 
mailing to the Contractor of a supplemental agreement for execution 
either confirming completed negotiations between the parties or carrying 
out a decision of a board of contract appeals.
    (b) Notwithstanding (a), above, (1) interest shall be applied only 
from the date payment was due, if such date is later than the filing of 
appeals, and (2) interest shall not be paid for any period of time that 
the Contracting Officer determines the Contractor has unduly delayed in 
pursuing its remedies before a board of contract appeals or a court of 
competent jurisdiction.
    The Contractor further agrees to comply with any rules, regulations 
and reporting requirements which may be imposed by the HHS Office for 
Civil Rights for purposes of insuring the proper exercise of this 
authority. The Contractor agrees to insert this clause in all 
subcontract(s) under this contract.

                             (End of clause)

  Clause No. 37--Fair and Equal Treatment of Indian People (June 1977)

    (a) The Contractor agrees consistent with medical needs to make no 
discriminatory distinctions among Indian patients or beneficiaries of 
this contract. For the purpose of this contract discriminatory 
distinctions include but are not limited to the following:
    (i) denying a patient any service or benefit or availability of a 
facility;
    (ii) providing any service or benefit to a patient which is 
different, or is provided in a different manner or at a different time 
from that provided to other patients under this contract; subjecting a 
patient to segregation or separate treatment in any manner related to 
his/her receipt of any service; restricting a patient in any way in the 
enjoyment of any advantage or privilege enjoyed by others receiving any 
service or benefit; treating a patient differently from others in 
determining whether he/she satisfies any admission, enrollment, quota, 
eligibility membership, or other requirements of condition which 
individuals must meet in order to be provided any service or benefit; 
the assignment of times or places for the provision of services on the 
basis of discriminatory distinctions which may be made of the patients 
to be served.
    (b) The Government reserves the right to reassume this contract in 
whole or in part whenever the Contractor fails to comply with the 
requirements of this clause.

                             (End of clause)

    Clause No. 38--Price Reduction for Defective Cost or Pricing Data

    The following clause applies to all contracts where cost and pricing 
data is required in accordance with P.L. 87-653.

     Price Reduction for Defective Cost or Pricing Data (June 1977)

    (a) If the Contracting Officer determines that any price negotiated 
in connection with this contract or any cost reimbursable under this 
contract was increased by any significant sums because the Contractor, 
or any subcontractor pursuant to the Clause of this contract entitled 
``Subcontractor Cost or Pricing Data'' or ``Subcontractor Cost or 
Pricing Data-Price Adjustments,'' or any subcontract clause therein 
required, furnished incomplete or inaccurate cost or pricing data or 
data not current as certified in its Contractor's Certificate of Current 
Cost or Pricing Data, then such price or cost shall be reduced 
accordingly and the contract shall be modified in writing to reflect 
such reduction.
    (b) Failure to agree on a reduction shall be a dispute concerning a 
question of fact within the meaning of the ``Disputes'' clause of this 
contract.

    Note:  Since this contract is subject to reduction under this clause 
by reason of defective cost or pricing data submitted in connection with 
certain subcontracts, it is expected that the Contractor may wish to 
include a clause in each such subcontract requiring the subcontractor to 
appropriately indemnify the Contractor. It is also expected that any 
subcontractor subject to such indemnification will generally require 
substantially similar indemnification for defective cost or pricing data 
required to be submitted by its lower tier subcontractors.)


[[Page 192]]



                             (End of clause)

           Clause No. 39--Subcontractor Cost and Pricing Data

    The following clauses should be included in all contracts, when the 
subcontracts of the type and size described therein are contemplated.

             Subcontractor Cost and Pricing Data (June 1977)

    (a) The Contractor shall require subcontractors hereunder to submit 
in writing cost or pricing data under the following circumstances:
    (1) Prior to award of any cost-reimbursed type, time and material, 
labor-hour, incentive, or price redeterminable subcontract the price of 
which is expected to exceed $100,000; and
    (2) Prior to the award of any other subcontract, the price of which 
is expected to exceed $100,000, or to the pricing of any subcontract 
change or other modification of which the price adjustment is expected 
to exceed $100,000, where the price or price adjustment is not based on 
adequate price competition, established catalog or market price or 
commercial items sold in substantial quantities to the general public, 
or prices set by law or regulation.
    (b) The Contractor shall require subcontractors to certify, 
substantially the same form as that used in the certificate by the Prime 
Contractor to the Government, that, to the best of their knowledge and 
belief, the cost and pricing data submitted under (a) above are 
accurate, complete, and current as of the date of the execution, which 
date shall be as close as possible to the date of agreement on the 
negotiated price of the subcontract or subcontract change or 
modification.
    (c) The Contractor shall insert the substance of this clause 
including this paragraph (c) in each of its cost-reimbursement type, 
time and material, labor-hour, price redeterminable, or incentive 
subcontracts hereunder, and in any other subcontract hereunder which 
exceeds $100,000 unless the price thereof is based on adequate price 
competition, established catalog or market prices of commercial items 
sold in substantial quantities to the general public, or prices set by 
law or regulation. In each such expected subcontract hereunder which 
exceeds $100,000, the Contractor shall insert the substance of the 
following clauses:

         Subcontractor Cost and Pricing Data--Price Adjustments

    (a) Paragraphs (b) and (c) of this clause shall become operative 
only with respect to any change or other modification made pursuant to 
one or more provisions of this contract which involves a price 
adjustment in excess of $100,000. The requirements of this clause shall 
be limited to such price adjustments.
    (b) The Contractor shall require subcontractors hereunder to submit 
cost or pricing data under the following circumstances:
    (1) Prior to award of any cost-reimbursement type, time and 
material, labor-hour, incentive, or price redeterminable subcontract, 
the price of which is expected to exceed $100,000; and
    (2) Prior to award of any other subcontract, the price of which is 
expected to exceed $100,000, or to the pricing of any subcontract change 
or other modification for which the price adjustment is expected to 
exceed $100,000, where the price or price adjustment is not based on 
adequate price competition, established catalog or market prices of 
commercial items sold in substantial quantities to the general public, 
or prices set by law or regulation.
    (c) The Contractor shall require subcontractors to certify, in 
substantially the same form as that used in the Certificate by the Prime 
Contractor to the Government, that, to the best of their knowledge and 
belief, the cost and pricing data submitted under (b) above are 
accurate, complete, and current as of the date of the execution, which 
date shall be as close as possible to the date of agreement on the 
negotiated price of the contract modification.
    (d) The Contractor shall insert the substance of this clause 
including this paragraph (d) in each subcontract hereunder which exceeds 
$100,000.

                             (End of clause)

                  Clause No. 40--Penalties (June 1977)

    (a) Any officer, director, agent, employee or such other person 
connected in any capacity with this contract or any subcontract 
thereunder that embezzles, willfully misapplies, steals or obtains by 
fraud any of the money, funds, assets or property provided through the 
contract shall be fined not more than $10,000 or imprisoned for more 
than two years, or both; Provided, That if the amount embezzled, 
misapplied, stolen, or obtained by fraud does not exceed $100, such 
person shall be fined not more than $1,000 or imprisoned not more than 
one year, or both.
    (b) The Contractor agrees to insert the clause in all subcontracts.

                             (End of clause)

          Clause No. 41--Effect on Existing Rights (June 1977)

    (a) Nothing in this contract shall be construed as:
    (1) Affecting, modifying, diminishing, or otherwise impairing the 
sovereign immunity for suit enjoyed by an Indian tribe; or,

[[Page 193]]

    (2) Authorizing or requiring the termination of any existing trust 
responsibility of the United States with respect to the Indian people.

                             (End of clause)

   Clause No. 42--General Services Administration (GSA) Supply Sources

    Indian tribal organizations which are awarded cost-reimbursement 
type contracts under the Indian Self-Determination Act, may be 
authorized to utilize GSA supply sources. The following clause will be 
inserted in all cost-reimbursement type contracts under which the 
Contractor may be authorized to acquire items for the account of the 
Government from GSA supply sources:

       General Services Administration Supply Sources (June 1977)

    The Contracting Officer may issue the Contractor an authorization to 
utilize General Services Administration supply sources for property to 
be used in the performance of this contract. Title to all property 
acquired by the Contractor under such an authorization shall vest in the 
Government, (1) unless otherwise specifically provided in the contract, 
(2) unless otherwise provided in the Government Property clause of this 
contract, or (3) in the absence of both the conditions in (1) and (2) of 
the clause. However, such property shall not be considered to be 
``Government-furnished property.''

                             (End of clause)

    (b) Insert the following clauses in fixed price contracts awarded 
under the Indian Self-Determination Act as described in Subpart PHS 
380.4:

                  Clause No. 1--Definitions (June 1977)

    As used throughout this contract, the following terms shall have the 
meanings set forth below:
    (a) The term ``Secretary'' means the Secretary, the Under Secretary, 
or any Assistant Secretary of the Department of Health and Human 
Services and the term ``his/her duly authorized representative'' means 
any person or persons or board (other than the Contracting Officer) 
authorized to act for the Secretary.
    (b) The term ``Contracting Officer'' means the person executing this 
contract on behalf of the Government, and any other officer or employee 
who is properly designated Contracting Officer; and the term includes, 
except as otherwise provided in this contract, the authorized 
representative of the Contracting Officer acting within the limits of 
his/her authority.
    (c) The term ``Department'' means the Department of Health and Human 
Services (HHS).
    (d) The term ``constituent agency'' means the agency of the 
Department responsible for the administration of this contract.
    (e) Except as otherwise provided in this contract, the term 
``subcontract'' includes purchase orders under this contract.
    (f) The term ``Project Officer'' means the person representing the 
Government for the purpose of technical direction of contract 
performance. The Project Officer is not authorized to issue any 
instructions or directions which effect any increase or decrease in the 
cost of this contract or which change the period of this contract.

                             (End of clause)

                   Clause No. 2--Disputes (June 1977)

    (a) Except as otherwise provided in this contract, any dispute 
concerning a question of fact arising under this contract which is not 
disposed of by agreement shall be decided by the Contracting Officer, 
who shall reduce his/her decision to writing and mail or otherwise 
furnish a copy thereof to the Contractor. The decision of the 
Contracting Officer shall be final and conclusive unless, within 30 days 
from the date of receipt of such copy, the Contractor mails or otherwise 
furnishes to the Contracting Officer a written appeal addressed to the 
Secretary. The decision of the Secretary or his/her duly authorized 
representative for the determination of such appeals shall be final and 
conclusive unless determined by a court of competent jurisdiction to 
have been fraudulent, or capricious, or arbitrary, or so grossly 
erroneous as necessarily to imply bad faith, or not supported by 
substantial evidence. In connection with any appeal proceeding under 
this clause, the Contractor shall be afforded an opportunity to be heard 
and to offer evidence in support of its appeal. Pending final decision 
of a dispute hereunder, the Contractor shall proceed diligently with the 
performance of the contract and in accordance with the Contracting 
Officer's decision.
    (b) This ``Disputes'' clause does not preclude consideration of law 
questions in connection with decisions provided for in paragraph (a) 
above; Provided, That nothing in this contract shall be construed as 
making final the decision of any administrative official, 
representative, or board on a question of law.

                             (End of clause)

  Clause No. 3--Contract Work Hours and Safety Standard Act--Overtime 
                        Compensation (June 1977)

    This contract, to the extent it is of a character specified in the 
Contract Work Hours and Safety Standards Act (40 U.S.C. 327-330), is 
subject to the following provisions and exceptions of such Act and the 
regulations of the Secretary of Labor thereunder.

[[Page 194]]

    (a) Overtime requirements. No Contractor or subcontractor 
contracting for any part of the contract work which may require or 
involve the employment of laborers or mechanics shall require or permit 
any laborer or mechanic in any workweek in which he/she is employed on 
such work to work in excess of eight hours in any calendar day or in 
excess of forty hours in such workweek on work subject to the provisions 
of the Contract Work Hours Standard Act unless such laborer or mechanic 
receives compensation at a rate not less than one and one-half times 
his/her basic rate of pay for all such hours worked in excess of eight 
hours in any calendar day or in excess of forty hours in such workweek, 
whichever is the greater numbers of overtime hours.
    (b) Violation; liability for unpaid wages; liquidated damages. In 
the event of any violation of the provisions of paragraph (a), the 
Contractor and any subcontractor responsible therefor shall be liable to 
any affected employee for his/her unpaid wages. In addition, such 
Contractor and subcontractor shall be liable to the United States for 
liquidated damages. Such liquidated damages shall be computed with 
respect to each individual laborer or mechanic employed in violation of 
the provisions of paragraph (a) at the sum of $10 for each calendar day 
on which such employee was required or permitted to be employed on such 
work in excess of eight hours or in excess of the standard workweek of 
forty hours without payment of the overtime wages required by paragraph 
(a).
    (c) Withholding for unpaid wages and liquidated damages. The 
Contracting Officer may withhold from the Government Prime Contractor, 
from any moneys payable on account of work performed by the Contractor 
or subcontractor, such sums as may administratively be determined to be 
necessary to satisfy any liabilities of such Contractor or subcontractor 
for unpaid wages and liquidated damages as provided in the provisions of 
paragraph (b).
    (d) Subcontracts. The Contractor shall insert paragraphs (a) through 
(d) of this clause in all subcontracts, and shall require their 
inclusion in all subcontracts of any tier.
    (e) Records. The Contractor shall maintain payroll records 
containing the information specified in 29 CFR 516.2(a). Such records 
shall be preserved for three years from the completion of the contract. 
This requirement does not apply where the tribal contractor is the 
governing body of the Tribe and the work is being performed by the 
tribal organization or Tribe with its own regular employees.

                             (End of Clause)

       Clause No. 4--Walsh-Healey Public Contracts Act (June 1977)

    If this contract is for the manufacture or furnishing of materials, 
supplies, articles, or equipment in an amount which exceeds or may 
exceed $10,000 and is otherwise subject to the Walsh-Healey Public 
Contracts Act, as amended (41 U.S. Code 34-45), there are hereby 
incorporated by reference all representations and stipulations required 
by the Secretary of Labor, such representations and stipulations being 
subject to all applicable rulings and interpretations of the Secretary 
of Labor which are now or may hereafter be in effect. This requirement 
does not apply where the tribal contractor is the governing body of the 
Tribe and the work is being performed by the tribal organization or 
Tribe with its own regular employees.

                             (End of Clause)

                 Clause No. 5--Convict Labor (June 1977)

    In connection with the performance of work under this contract, the 
Contractor agrees not to employ any person undergoing sentence of 
imprisonment at hard labor except as provided by Public Law 89-176, 
September 10, 1965 (18 U.S.C. 4082(c)(2) and Executive Order No. 11755, 
December 29, 1973.

                             (End of clause)

      Clause No. 6--Notice to the Government of Delays (June 1977)

    Whenever the Contractor has knowledge that any actual or potential 
situation is delaying or threatens to delay the timely performance of 
this contract, the Contractor shall within ten days give notice thereof, 
including all relevant information with respect thereto, to the 
Contracting Officer.

                             (End of clause)

             Clause No. 7--Assignment of Claims (June 1977)

    (a) Pursuant to the provisions of the Assignment of Claims Act of 
1940, as amended (31 U.S.C. 203, 41 U.S.C. 15), if this contract 
provides for payment aggregating $1,000 or more, claims for moneys due 
or to become due the Contractor from the Government under this contract 
may be assigned to a bank, trust company, or other financing 
institution, including any Federal lending agency, and may thereafter be 
further assigned and reassigned to any such institution. Any such 
assignment or reassignment shall cover all amounts payable under this 
contract and not already paid, and shall not be made to more than one 
party, except that any such assignment or reassignment may be made to 
one party as agent or trustee for

[[Page 195]]

two or more parties participating in such financing. Unless otherwise 
provided in this contract payments to assignee of any moneys due or due 
to become due under this contract shall not, to the extent provided in 
said Act, as amended, be subject to reduction or setoff. (The preceding 
sentence applies only if this contract is made in time of war or 
national emergency as defined in said Act and is with the Department of 
Defense, the General Services Administration, the Atomic Energy 
Commission, the National Aeronautics and Space Administration, the 
Federal Aviation Agency, or any other department or agency of the United 
States designated by the President pursuant to Clause 4 of the proviso 
of section 1 of the Assignment of Claims Act of 1940, as amended by the 
Act of May 15, 1951, 65 Stat. 41).
    (b) In no event shall copies of this contract or of any plans, 
specifications, or other similar documents relating to work under this 
contract, if marked ``Top Secret,'' ``Secret,'' or ``Confidential,'' be 
furnished to any assignee of any claim arising under this contract or to 
any other person not entitled to receive the same. However, a copy of 
any part or all of this contract so marked may be furnished, or any 
information contained therein may be disclosed, to such assignee upon 
the prior written authorization of the Contracting Officer.

                             (End of clause)

           Clause No. 8--Officials Not To Benefit (June 1977)

    No member of or delegate to Congress, or resident commissioner, 
shall be admitted to any share or part of this contract, or to any 
benefit that may arise therefrom; but this provision shall not be 
construed to extend to this contract if made with a corporation for its 
general benefit.

                             (End of clause)

               Clause No. 9--Anti-Kickback Act (June 1977)

    (a) Public Law 86-695, September 2, 1960 (41 U.S.C. 51-54) among 
other things, prohibits the payment, directly or indirectly, by or on 
behalf of a subcontractor in any tier under any Government negotiated 
contract of any fee, gift, or gratuity to the prime contractor or any 
officer, agent, partner or employee thereof, as an inducement or 
acknowledgement for the award of a subcontract or order.
    (b) The provisions of Public Law 86-695 are applicable this contract 
and any subcontracts entered into under the contract.

                             (End of clause)

                  Clause No. 10--Penalties (June 1977)

    Any officer, director, agent, employee or such other person 
connected in any capacity with this contract or any subcontract 
thereunder that embezzles, willfully misapplies, steals or obtains by 
fraud any of the money, funds, assets or property provided through the 
contract shall be fined not more than $10,000 or imprisoned for not more 
than two years, or both; Provided, That if the amount embezzled, 
misapplied, stolen, or obtained by fraud does not exceed $100, such 
person shall be fined not more than $1,000 or imprisoned not more than 
one year, or both.
    (b) The Contractor agrees to insert this clause in all subcontracts.

                             (End of clause)

               Clause No. 11--Buy American Act (June 1977)

    (a) In acquiring end products, the Buy American Act (41 U.S. Code 
10a-d) provides that the Government give preference to domestic source 
end products. For the purpose of this clause:
    (i) ``Components'' means those articles, materials, and supplies, 
which are directly incorporated in the end products;
    (ii) ``End products'' means those articles, materials, and supplies, 
which are to be acquired under this contract for public use; and
    (iii) ``A domestic source end product'' means (A) an unmanufactured 
end product which has been mined or produced in the United States and 
(B) an end product manufactured in the United States if the cost of the 
components thereof which are mined, produced, or manufactured in the 
United States exceeds 50 percent of the cost of all its components. For 
the purposes of this (a)(iii)(B), components of foreign origin of the 
same type or kind as the products referred to in (b) (ii) or (iii) of 
this clause shall be treated as components mined, produced, or 
manufactured in the United States.
    (b) The Contractor agrees that there will be delivered under this 
contract only domestic source end products, except end products:
    (i) Which are for use outside the United States;
    (ii) Which the Government determines are not mined, produced, or 
manufactured in the United States in sufficient and reasonably available 
commercial quantities and of a satisfactory quality;
    (iii) As to which the Secretary determines the domestic preference 
to be inconsistent with the the public interest; or
    (iv) As to which the Secretary determines the cost to the Government 
to be unreasonable. (The foregoing requirements are administered in 
accordance with Executive Order No. 10582, dated December 17, 1954).

                             (End of clause)

              Clause No. 12--Equal Opportunity (June 1977)

    Subject to the Indian preference requirements of Clause 17, during 
the performance

[[Page 196]]

of this contract the Contractor agrees as follows:
    (a) The Contractor will not discriminate against any employee or 
applicant for employment because of race, creed, color, or national 
origin. The Contractor will take affirmative action to ensure that 
applicants are employed, and that employees are treated during 
employment, without regard to their race, creed, color, or national 
origin. Such action shall include, but not be limited to, the following: 
Employment, upgrading, demotion, or transfer; recruitment or recruitment 
advertising; layoff or termination, rates of pay or other forms of 
compensation; and selection for training, including apprenticeship. The 
Contractor agrees to post in conspicuous places, available to employees 
and applicants for employment, notices to be provided by the Contracting 
Officer setting forth the provisions of this Equal Opportunity clause.
    (b) The Contractor will, in all solicitations or advertisement for 
employees placed by or on behalf of the Contractor, state that all 
qualified applicants will receive consideration for employment without 
regard to race, creed, color, or national origin.
    (c) The Contractor will send to each labor union or representative 
of workers with which it has a collective bargaining agreement or other 
contract or understanding, a notice, to be provided by the agency 
Contracting Officer, advising the labor union or workers representative 
of the Contractor's commitments under this Equal Opportunity clause, and 
shall post copies of the notice in conspicuous places available to 
employees and applicants for employment.
    (d) The Contractor will comply with all provisions of Executive 
Order No. 11246 of Sepember 24, 1965, and of the rules, regulations and 
relevant orders of the Secretary of Labor.
    (e) The Contrator will furnish all information and reports required 
by executive Order No. 11246 of September 24, 1965, and by the rules, 
regulations, and orders of the Secretary of Labor, or pursuant thereto, 
and will permit access to its books, records, and accounts by the 
contracting agency and the secretary of Labor for purposes of 
investigation to ascertain compliance with such rules, regulations, and 
orders.
    (f) In the event of the Contractor's noncompliance with the Equal 
Opportunity clause of this contract or with any of the said rules, 
regulations, or orders, this contract may be cancelled, terminated, or 
suspended, in whole or in part, and the Contractor may be declared 
ineligible for further Government contracts in accordance with 
procedures authorized in Executive Order No. 11246 of September 24, 
1965, and such other sanctions may be imposed and remedies invoked as 
provided in Executive Order No. 11246 of September 24, 1965, or by rule, 
regulation, or order of the Secretary of Labor, or as otherwise provided 
by law.
    (g) The Contractor will include the provisions of paragraphs (a) 
through (g) in every subcontract or purchase order unless exempted by 
rules, regulations, or orders of the Secretary of Labor issued pursuant 
to section 204 of Executive Order No. 11246 of September 24, 1965, so 
that such provisions will be binding upon each subcontractor or vendor. 
The Contractor will take such action with respect to any subcontract or 
purchase order as the contracting agency may direct as a means of 
enforcing such provisions, including sanctions for noncompliance: 
Provided, however, That in the event the Contractor becomes involved in, 
or is threatened with, litigation with a subcontractor or vendor as a 
result of such direction by the contracting agency, the Contractor may 
request the United States to enter into such litigation to protect the 
interests of the United States.

                             (End of clause)

   Clause No. 13--Certificate of Nonsegregated Facilities (June 1977)

    By signing the contract the Contractor certifies that it does not 
maintain or provide for its employees any segregated facilities at any 
of its establishments, and that it does not permit its employees to 
perform their services at any location, under its control, where 
segregated facilities are maintained. It certifies further that it will 
not maintain or provide for its employees any segregated facilities at 
any of its establishments, and that it will not permit its employees to 
perform their services at any location, under its control, where 
segregated facilities are maintained. The Contractor agrees that a 
breach of this certification is a violation of the Equal Opportunity 
clause in this contract. As used in this certification, the term 
``Segregated facilities'' means any waiting rooms, work areas, rest 
rooms and wash rooms, restaurants and other eating areas, time clocks, 
locker rooms and other storage or dressing areas, parking lots, drinking 
fountains, recreation or entertainment areas, transportation, and 
housing facilities provided for employees which are segregated by 
explicit directive or are in fact segregated on the basis of race, 
color, religion, or national origin, because of habit, local custom, or 
otherwise. It futher agrees that (except where it has obtained identical 
certification from proposed subcontractors for specific time periods) it 
will obtain identical certifications from proposed subcontractors prior 
to the award of subcontracts exceeding $10,000 which are not exempt from 
the provisions of the Equal Opportunity clause; that it will retain such 
certifications in its files; and that it will forward the following 
notice to such proposed subcontractors (except

[[Page 197]]

where the proposed subcontractors have submitted identical 
certifications for specific time periods):
    Notice to prospective subcontractors of requirement for 
certifications of nonsegregated facilities. A certification of 
Nonsegregated Facilities must be submitted prior to the award of a 
subcontract exceeding $10,000 which is not exempt from the provisions of 
the Equal Opportunity clause. The certification may be submitted either 
for each subcontract or all subcontracts during a period (i.e., 
quarterly, semiannually, or annually).

                             (End of clause)

                Clause No. 14--Subcontracting (June 1977)

    The Contractor shall not enter into subcontracts for any of the work 
contemplated under this contract without obtaining the prior written 
approval of the Contracting Officer and subject to such conditions and 
provisions as he/she may deem necessary, in his/her discretion, to 
protect the interests of the Government: Provided, however, That 
notwithstanding the foregoing, unless otherwise provided herein, such 
prior written approval shall not be required for the purchase by the 
Contractor of articles, supplies, equipment and services which are both 
necessary for and merely incidental to the performance of the 
requirements under this contract; Provided, further, however, That the 
aforesaid right of Contractor to engage such services shall in no event 
be construed to permit the Contractor to subcontract with a third-party 
for the performance of any major function contemplated under this 
contract to be performed by the Contractor, and Provided, further, 
however, That no provision of this clause and no such approval by the 
Contracting Officer of any subcontract shall be deemed in any event or 
in any manner to provide for the incurrence of any obligation of the 
Government in addition to the total contract price.

                             (End of clause)

        Clause No. 15--Competition in Subcontracting (June 1977)

    The Contractor agrees to select subcontractors on a competitive 
basis to the maximum practical consistent with the objectives and 
requirements of this contract.

                             (End of clause)

       Clause No. 16--Use of Indian Business Concerns (June 1977)

    (a) As used in this clause, the term, ``Indian business concern'' 
means Indian organizations or an Indian-owned economic enterprise as 
defined in 42 CFR 36.204(i).
    (b) The Contractor agrees to give preference to qualified Indian 
business concerns in the awarding of any subcontracts entered into under 
the contract consistent with efficient performance of the contract. The 
Contractor shall comply with any preference requirements regarding 
Indian business concerns established by the tribe(s) receiving services 
under the contract to the extent that such requirements are consistent 
with the purpose and intent of this paragraph.
    (c) If no Indian business concerns are available under the 
conditions in paragraph (b) above, the Contractor agrees to accomplish 
the maximum amount of subcontracting, as the Contractor determines is 
consistent with its efficient performance of the contract, with small 
business concerns, labor surplus area concerns or minority business 
enterprises, the definitions for which are contained in Subparts 1-1.7, 
1-1.8, and 1-1.13 of the Federal Procurement Regulations. The Contractor 
is not, however, required to establish a small business, labor surplus, 
or minority business subcontracting program as described in sections 1-
1.710-3(b), 1-1.805-3(b), and 1-1.1310-2(b), respectively of the Federal 
Procurement Regulations (41 CFR Chapter 1).

                             (End of clause)

 Clause No. 17--Indian Preference in Training and Employment (June 1977)

    (a) The Contractor shall give preference in employment for all work 
performed under the contract, including subcontracts thereunder, to 
qualified Indians regardless of age, religion, or sex, and to the extent 
feasible consistent with the efficient performance of the contract, 
provide employment and training opportunities to Indians, regardless of 
age, religion, or sex, that are not fully qualified to perform under the 
contract. The Contractor shall comply with any Indian preference 
requirements established by the tribe receiving services under the 
contract to the extent that such requirements are consistent with the 
purpose and intent of this paragraph.
    (b) If the Contractor or any of its subcontractors is unable to fill 
its employment openings after giving full consideration to Indians as 
required in paragraph (a) above, these employment openings may then be 
filled by other than Indians under the conditions set forth in the Equal 
Opportunity clause of this contract.
    (c) The Contractor agrees to include this clause or one similar 
thereto in all subcontracts issued under this contract.

                             (End of clause)

                  Clause No. 18--Inspection (June 1977)

    The Government, through any authorized representatives, has the 
right, at all reasonable times, to inspect, or otherwise evaluate

[[Page 198]]

the work performed or being performed hereunder and the premises in 
which it is being performed. If any inspection, or evaluation is made by 
the Government on the premises of the Contractor or a subcontractor, the 
Contractor shall provide and shall require its subcontractors to provide 
all reasonable facilities and assistance for the safety and convenience 
of the Government representatives in the performance of their duties. 
All inspections and evaluations shall be performed in such a manner as 
will not unduly delay the work.

                             (End of clause)

                   Clause No. 19--Changes (June 1977)

    The Contracting Officer may at any time, with the consent of the 
Contractor, by a written order, and without notice to the sureties, if 
any, make changes, within the general scope of this contract, in any one 
or more of the following (i) drawings, designs, or specifications, (ii) 
place of inspection, delivery, or acceptance, and (iii) the amount of 
Government-furnished property. If any such change causes an increase or 
decrease in the cost of, or the time required for performance of, this 
contract, or otherwise affects any other provisions of this contract, 
whether changed or not changed by any such order, an equitable 
adjustment shall be made (i) in the contract price or time of 
performance, or both, and (ii) in such provisions of the contract as may 
be so affected, and the contract shall be modified in writing 
accordingly. Any claim by the Contractor for adjustment under this 
clause must be asserted within thirty (30) days from the date of receipt 
by the Contractor of the notification of change; Provided, however, That 
the Contracting Officer, if he/she decides that the facts justify such 
action, may receive and act upon any such claim asserted at any time 
prior to final payment under this contract. Where the cost of property 
made obsolete or excess as a result of a change is included in the 
Contractor's claim for adjustment, the Contracting Officer shall have 
the right to prescribe the manner of disposition of such property. 
Failure to agree to any adjustment shall be a dispute concerning a 
question of fact within the meaning of the clause of this contract 
entitled ``Disputes.'' However, nothing in this clause shall excuse the 
Contractor from proceeding with the contract as changed.

                             (End of clause)

                 Clause No. 20--Retrocession (June 1977)

    (a) The Indian tribe that initially requested this contract may also 
request its retrocession, notwithstanding the fact that the Contractor 
may be a tribal organization other than the Tribe.
    (b) Should the Tribe request retrocession of the contract and the 
Contractor is other than the Tribe, the Contracting Officer will notify 
the Contractor of the request and in consultation with the Tribe and the 
Contractor establish the effective date of the retrocession. The 
retrocession will become effective no later than 120 days after the 
Contracting Officer receives the Tribe's request unless the Tribe and 
the Contracting Officer mutually agree on a later date.
    (c) Immediately after receipt of the request for retrocession and 
where applicable notifying the Contractor, the Contracting Officer will 
meet with the Contractor and, where applicable, the tribal governing 
body or bodies mutually agree to:
    (1) A plan for the orderly transfer of responsibilities;
    (2) A plan for inventorying materials and supplies on hand;
    (3) An accounting for funds, including but not limited to current 
and anticipated obligations;
    (4) The cost of operation until retrocession; and,
    (5) The identification of all records relating to the contract and 
the contracted function.

                             (End of clause)

 Clause No. 21--Assumption and Reassumption of Contract Programs (June 
                                  1977)

    (a) When the Contracting Officer determines that the performance of 
a Contractor under these regulations involves (1) the violation of the 
rights or endangerment of the health, safety, or welfare of any person, 
or (2) gross negligence or the mismanagement in the handling or use of 
funds under the contract, the Contracting Officer will, in writing, 
notify the Contractor of such determination and will request that the 
Contractor take such corrective action within such period of time as the 
Secretary may prescribe.
    (b) When the Director or his/her delegate determines that a 
Contractor has not taken corrective action (as prescribed by him/her 
under paragraph (a) of this section) to his/her satisfaction, he/she 
may, after the Contractor has been provided an opportunity for a hearing 
in accordance with paragraph (c) of this section, rescind the contract 
in whole or in part and, if he/she deems it appropriate, assume or 
resume control or operation of the program, activity, or service 
involved.
    (c)(1) When the Director or his/her delegate has made a 
determination described in paragraph (b) of this section, he/she shall 
in writing notify the Contractor of such determination and of the 
Contractor's right to request a review of such determination and of the 
determination described in paragraph (a) of

[[Page 199]]

this section. Such notification by the Director or his/her delegate 
shall set forth the reasons for the determination in sufficient detail 
to enable the Contractor to respond and shall inform the Contractor of 
its rights to a hearing on the record before a Contract Appeals Board 
described in paragraph (d) of this section. Upon the request of the 
Contractor for a hearing, the Board, established pursuant to paragraph 
(d) of this section, shall in writing within 10 days of the 
establishment notify the Contractor of the time, place and date of the 
hearing which will be held not later than 45 days after the request for 
a hearing.
    (2) Where the Director or his/her delegate determines that a 
Contractor's performance under a contract awarded under this subpart 
poses an immediate threat to the safety of any person, he/she may 
immediately rescind the contract in whole or in part and, if he/she 
deems it appropriate, assume or resume control or operation of the 
program, activity, or service involved. Upon such a decision he/she will 
immediately notify the Contractor of such action and the basis therefor; 
and offer the Contractor an opportunity for a hearing on the record 
before the Contract Appeals Board established pursuant to paragraph (d) 
of this section to be held within 10 days of each action.
    (d)(1) The Contract Appeals Board shall be composed of 3 persons 
appointed by the Director, Indian Health Service. Such persons may not 
be selected from the immediate office of any person participating in the 
determinations at issue. The Board shall afford the Contractor the 
right:
    (i) To notice of the issues to be considered;
    (ii) To be represented by counsel;
    (iii) To present witnesses on contractor's behalf;
    (iv) To cross-examine other witnesses either orally or through 
written interrogation; and
    (v) To compel the appearance of Indian Health Service personnel or 
to take depositions of such persons at reasonable times and places.
    (2) The Contract Appeals Board shall make an initial written 
decision which shall become final within 20 days unless the Director, 
Indian Health Service or his/her representative modifies or reverses the 
decision. Any such decision by the Director of the Indian Health Service 
or his/her representative shall be in writing, shall be specific as to 
the reasons for such decision, and shall be considered final.
    (3) Where Board is considering issues arising under paragraph (2) of 
this section, the Board shall within 25 days after the conclusion of the 
hearing, notify all parties in writing of its decision.
    (e) In any case where the officer has rescinded a contract under 
paragraphs (b) or (c) of this section, he/she may decline to enter into 
a new contract agreement with the Contractor until such time as he/she 
is satisfied that the basis for the rescission has been corrected.
    Nothing in this section shall be construed as contravening the 
Occupational Safety and Health Act of 1970 (84 Stat. 1590), as amended 
(29 U.S.C. 651).

                             (End of clause)

  Clause No. 22--Payment of Interest on Contractors' Claims (June 1977)

    (a) If an appeal is filed by the Contractor from a final decision of 
the Contracting Officer under the Disputes clause of this contract, 
denying a claim arising under the contract, simple interest on the 
amount of the claim finally determined owed by the Government shall be 
payable to the Contractor. Such interest shall be at the rate determined 
by the Secretary of the Treasury pursuant to Public Law 92-41, 85 Stat. 
97, from the date the Contractor furnished to the Contracting Officer 
his written appeal under the Disputes clause of this contract, to the 
date of (1) a final judgment by a court of competent jurisdiction, or 
(2) mailing to the Contractor of a supplemental agreement for execution 
either confirming completed negotiations between the parties or carrying 
out a decision of a board of contract appeals.
    (b) Notwithstanding (a), above, (1) interest shall be applied only 
from the date payment was due, if such date is later than the filing of 
appeal, and (2) interest shall not be paid for any period of time that 
the Contracting Officer determines the Contractor has unduly delayed in 
pursuing its remedies before a board of contract appeals or a court of 
competent jurisdiction.

                             (End of clause)

        Clause No. 23--Government-Furnished Property (June 1977)

    (a) The Government shall deliver to the Contractor, for use in 
connection with and under the terms of this contract, the property 
described elsewhere in this contract, together with such related data 
and information as the Contractor may request and as may reasonably be 
required for the intended use of such property (hereinafter referred to 
as ``Government-Furnished Property''). The delivery or performance dates 
for the supplies or services to be furnished by the Contractor under 
this contract are based upon the expectation that Government-Furnished 
Property suitable for use will be delivered to the Contractor at the 
times stated elsewhere in this contract or, if not so stated, in 
sufficient time to enable the Contractor by such time or times, to meet 
such delivery or performance dates. In the event that Government-
Furnished Property is not delivered to

[[Page 200]]

the Contractor to meet such delivery or performance dates, the 
Contracting Officer shall, upon timely written request made by the 
Contractor, make a determination of the delay occasioned the Contractor 
and shall equitably adjust the delivery or performance dates, or the 
contract price, or both, and any other contractual provision affected by 
the delay. In the event that Government-Furnished Property is received 
by the Contractor in a condition not suitable for its intended use, the 
Contractor shall, upon receipt thereof, notify the Contracting Officer 
of such fact and, as directed by the Contracting Officer, either (1) 
return such property at the Government's expense or otherwise dispose of 
such property, or (2) effect repairs or modifications. Upon completion 
of (1) or (2) above, the Contracting Officer upon timely written request 
of the Contractor shall equitably adjust the delivery or performance 
dates of the contract price, or both, and any other contractual 
provision effected by the return, disposition, repair, or modification. 
The foregoing provisions for adjustment are exclusive and the Government 
shall not be liable to suit for breach of contract by reason of any 
delay in delivery of Government-Furnished Property or delivery of such 
property in a condition not suitable for its intended use.
    (b) By notice in writing the Contracting Officer may decrease the 
property furnished or to be furnished by the Government under this 
contract. In any such case, the Contracting Officer upon timely written 
request of the Contractor shall equitably adjust the delivery or 
performance date or the contract price, or both, and any other 
contractual provisions affected by the decrease.
    (c) Title to the Government-Furnished Property shall remain in the 
Government. Title to Government-Furnished Property shall not be affected 
by the incorporation or attachment thereof to any property not owned by 
the Government, nor shall such Government-Furnished Property, or any 
part thereof, be or become a fixture or lose its identity as personality 
by reason of affixation to any realty.
    (d) The Government-Furnished Property, unless otherwise specifically 
provided herein, and except as otherwise approved or directed by the 
Contracting Officer in writing, shall be used exclusively for the 
performance of this contract.
    (e) The Contractor shall maintain and administer, in accordance with 
sound business practice, a program for the maintenance, repair, 
protection and preservation of Government-Furnished Property, until 
disposed of by the Contractor in accordance with this clause. In the 
event that any damage occurs to Government-Furnished Property the risk 
of which has been assumed by the Government under this contract, the 
Government shall replace such items or the Contractor shall make such 
repair of the property, as the Government directs; Provided, however, 
That if the Contractor cannot effect such repair within the time 
required, the Contractor may reject such property. The contract price 
includes no compensation to the Contractor for the performance of any 
repair or replacement for which the Government is responsible; and an 
equitable adjustment will be made in the contract price for any such 
repair or replacement of Government-Furnished Property made at the 
direction of the Government. Any repair or replacement for which the 
Contractor is responsible under the provisions of this contract shall be 
accomplished by the Contractor at its own expense.
    (f) The Contractor also agrees to maintain and administer, in 
accordance with sound business practice, a property control system which 
will provide the following: Contract number; nomenclature of item; 
quantity received; issued; and balance on hand; posting reference to 
include date received, issued unit price and location; marking or 
identification of item; adequate maintenance, storage, and security of 
Government-Furnished Property, until disposed of by the Contractor in 
accordance with this clause. The Contractor further agrees to receipt 
promptly for all Government property in a form and manner as prescribed 
by the Contracting Officer.
    (g) The Contractor agrees to make available to authorized 
representatives of the Contracting Officer at all reasonable times at 
the office of the Contractor all of its property records under this 
contract, and access to any premises where any of the Government-
Furnished Property is located.
    (h) (i) The Contractor shall not be liable for any loss or damage to 
the Government-Furnished Property, or for expenses incidental to such 
loss or damage except that the Contractor shall be liable for any such 
loss or damage (including expenses incidental thereto):
    (A) Which results from willful misconduct or lack of good faith on 
the part of any of the Contractor's directors or officers, or on the 
part of any of its managers, superintendents, or other equivalent 
representatives who have supervision or direction of all or 
substantially all of the Contractor's business, or all or substantially 
all of the Contractor's operations at any one plant, laboratory, or 
separate location in which this contract is being performed; or
    (B) Which results from a failure on the part of the Contractor, due 
to the willful misconduct or lack of good faith on the part of any of 
its directors, officers, or other representatives mentioned in 
subparagraph (A) above, to maintain and administer, in accordance with 
sound business practice, the program for maintenance, repair, protection 
and preservation of Government-Furnished

[[Page 201]]

Property as required by subparagraph (e) above; or
    (C) For which the Contractor is otherwise responsible under the 
express terms of the clause or clauses designated in this contract; or
    (D) Which results from a risk expressly required to be insured under 
some other provision of this contract, or of the schedules or task 
orders thereunder, but only to the extent of the insurance so required 
to be procured and maintained or to the extent of insurance actually 
procured and maintained, whichever is greater; or
    (E) Which results from a risk which is in fact covered by insurance 
or for which the Contractor is otherwise reimbursed but only to the 
extent of such insurance or reimbursement; Provided, That, if more than 
one of the above exceptions shall be applicable in any case, the 
Contractor's liability under any one exception shall not be limited by 
any other exception.
    (ii) The Contractor represents that it is not including the price 
hereunder, and agrees that it will not hereafter include in any price to 
the Government, any charge or reserve for insurance (including self-
insurance funds or reserves) covering loss or destruction of or damage 
to the Government-Furnished Property, except the extent that the risk of 
loss is imposed on the Contractor under (i)(C) above, or insurance has 
been required under (i)(D) above.
    (iii) Upon the happening of loss or destruction of or damage to any 
Government-Furnished Property, the Contractor shall notify the 
Contracting Officer thereof and shall take all reasonable steps to 
protect the Government-Furnished Property from further damage, separate 
the damaged and undamaged Government-Furnished Property in the best 
possible order, and furnish to the Contracting Officer a statement of:
    (A) The lost, destroyed and damaged Government-Furnished Property;
    (B) The time and origin of the loss, destruction or damage;
    (C) All known interest in commingled property of which the 
Government-Furnished Property is a part; and
    (D) The insurance, if any, covering any part of or interest in such 
commingled property.
    The Contractor shall be reimbursed for the expenditures made by it 
in performing its obligations under the subparagraph (iii), to the 
extent approved by the Contracting Officer and set forth in a 
supplemental agreement or amendment to this contract.
    (iv) With the prior written approval of the Contracting Officer 
after loss or destruction of or damage to Government-Furnished Property, 
and subject to such conditions and limitations as may be imposed by the 
Contracting Officer, the Contractor may, in order to minimize the loss 
to the Government or in order to permit resumption of business or the 
like, sell for the account of the Government any item of Government-
Furnished Property which has been damaged beyond practicable repair, or 
which is so commingled or combined with property of other, including the 
Contractor, that separation is impracticable.
    (v) Except to the extent of any loss or destruction of or damage to 
Government-Furnished Property for which the Contractor is relieved of 
liability under the foregoing provisions of this clause, and except for 
reasonable wear and tear or depreciation, or the utilization of the 
Government-Furnished Property in accordance with the provisions of this 
contract, the Government-Furnished Property (other than property 
permitted to be sold) shall be returned to the Government in as good 
condition as when received by the Contractor in connection with this 
contract, or as repaired under paragraph (e) above.
    (vi) In the event the Contractor is reimbursed or compensated for 
any loss or destruction of or damage to the Government-Furnished 
Property, it shall equitably reimburse the Government. The Contractor 
shall do nothing to prejudice the Government's rights to recover against 
third parties for any such loss, destruction or damage and, upon the 
request of the Contracting Officer shall at the Government's expense, 
furnish to the Government all reasonable assistance and cooperation 
(including assistance in the prosecution of suit and the execution of 
instruments of assignment in favor of the Government) in obtaining 
recovery.
    (i) Upon completion or expiration of this contract, any Government 
property which has not been consumed in the performance of this contract 
or which has not been previously disposed of in accordance with the 
provisions of this clause, or for which the Contractor has not otherwise 
been relieved of responsibility, shall be disposed of as the Contracting 
Officer may direct. The Contractor shall in no way be relieved of 
responsibility for Government property without the prior written 
approval of the Contracting Officer.
    (j) If the Contracting Officer determines that the interests of the 
Government require removal of any Government-Furnished Property, or if 
the Contractor determines any Government-Furnished Property to be in 
excess of its need under this contract such Government-Furnished 
Property shall be disposed of in the same manner as covered by paragraph 
(i) above. In the event that the Contracting Officer requires the 
removal of any Government-Furnished Property under this paragraph (j) or 
paragraph (i) above, upon timely written request of the Contractor, an 
equitable adjustment shall be made in the contract price to cover the 
direct cost to the Contractor of such removal and of any property damage 
occasioned thereby.

[[Page 202]]

                             (End of clause)

 Clause No. 24--Examination of Records by the Comptroller General (June 
                                  1977)

    (a) The Contractor agrees that the Comptroller General of the United 
States or any of his/her duly authorized representatives shall, until 
expiration of 3 years after final payment under this contract, or of the 
time periods for the particular records specified in Part 1-20 of the 
Federal Procurement Regulations (41 CFR Part 1-20), whichever expires 
earlier, have access to and the right to examine any directly pertinent 
books, documents, papers, and records of the Contractor involving 
transactions related to this contract.
    (b) The Contractor further agrees to include in all its subcontracts 
hereunder a provision to the effect that the subcontractor agrees that 
the Comptroller General of the United States or any of his/her duly 
authorized representatives shall, until expiration of 3 years after 
final payment under the subcontract, or of the time periods for the 
particular records specified in Part 1-20 of the Federal Procurement 
Regulations (41 CFR Part 1-20), whichever expires earlier, have access 
to and the right to examine any directly pertinent books, documents, 
papers, and records of such subcontractor, involving transactions 
related to the subcontract. The term ``subcontract'' as used in this 
clause excludes (1) purchase orders not exceeding $2,500 and (2) 
subcontracts or purchase orders for public utility services at rates 
established for uniform applicability to the general public.

                             (End of clause)

           Clause No. 25--Indemnity and Insurance (June 1977)

    (a) The Contractor shall indemnify and save and keep harmless the 
Government against any or all loss, cost, damage, claim, expense or 
liability whatsoever, because of accident or injury to persons or 
property or others occurring in connection with any program including as 
a part of this contract, by providing where applicable, the insurance 
described below:
    (b) The Contractor shall secure, pay the premium for, and keep in 
force until the expiration of this contract, or any renewal period 
thereof, insurance as provided below. Such insurance policies shall 
specifically include a provision stating the liability assumed by the 
Contractor under this contract.
    (1) Workman's compensation insurance as required by laws of the 
state.
    (2) Owner's, landlord's, and tenant's bodily injury liability 
insurance with limits of not less than $50,000 for each person and 
$500,000 for each accident.
    (3) Property damage liability insurance with limits of not less than 
$25,000 for each accident.
    (4) Automobile bodily injury liability insurance with limits of not 
less than $50,000 for each person, and $500,000 for each accident and 
property damage liability insurance with a limit of not less than $5,000 
for each accident.
    (5) Food products liability insurance with limits of not less than 
$50,000 for each person and $500,000 for each accident.
    (6) Professional malpractice insurance where medical, dental, or 
other health professional services are involved.
    (7) Other liability insurance not specifically mentioned when 
required.
    (c) Each policy of insurance shall contain an endorsement providing 
that cancellation by the insurance company shall not be effective unless 
a copy of the cancellation is mailed (registered) to the Contracting 
Officer 30 days prior to the effective date of cancellation.
    (d) A certificate of each policy of insurance, and any change 
therein, shall be furnished to the Contracting Officer immediately upon 
receipt from the insurance company.
    (e) Insurance companies of the Contractor shall be satisfactory to 
the Contracting Officer. When in his/her opinion an insurance company is 
not satisfactory for reasons that will be stated, the Contractor shall 
provide insurance through companies that are satisfactory to the 
Contracting Officer.
    (f) Each policy of insurance shall contain a provision that the 
insurance carrier waives any rights it may have to raise as a defense 
the tribe's sovereign immunity from suit, but such waiver shall extend 
only to claims the amount and nature of which are within the coverage 
and limits of the policy of insurance. The policy shall contain no 
provision, either expressed or implied, that will serve to authorize or 
empower the insurance carrier to waive or otherwise limit the tribe's 
sovereign immunity outside or beyond the coverage and limits of the 
policy or insurance.

                             (End of clause)

  Clause No. 26--Fair and Equal Treatment of Indian People (June 1977)

    (a) The Contractor agrees to make no discriminatory distinctions 
among Indian patients or beneficiaries of this contract. For the purpose 
of this contract discriminatory distinctions include but are not limited 
to the following:
    (i) Denying a patient any service or benefit or availability of a 
facility;
    (ii) Providing any service or benefit to a patient which is 
different, or is provided in a different manner or at a different time 
from that provided to other patients under this

[[Page 203]]

contract; subjecting a patient to segregation or separate treatment in 
any manner related to his/her receipt of any service; restricting a 
patient in any way in the enjoyment of any advantage or privilege 
enjoyed by others receiving any service or benefit; treating a patient 
differently from others in determining whether he/she satisfies any 
admission, enrollment, quota, eligibility membership, or other 
requirements or conditions which individuals must meet in order to be 
provided any service or benefit; the assignment of times or places for 
the provision of services on the basis of discriminatory distinctions 
which may be made of the patients to be served.
    (b) The Government reserves the right to terminate this contract in 
whole or in part whenever the Contractor fails to comply with the 
requirements of this clause.

                             (End of clause)

  Clause No. 27--Reports to the Indian People and Annual Reports (June 
                                  1977)

    (a) The Contractor, as a recipient of Federal financial assistance, 
shall make reports and information available to the Indian people 
serviced or represented by the Contractor. Such reports will reflect how 
the Federal assistance funds were utilized to the benefit of the Indian 
people served or represented as follows: (specific reporting 
requirements, formats and methods of distribution to the Indian people 
will be prescribed in the scope of the contract.)
    (b) Annual reports.
    (1) For each fiscal year during which a tribal organization receives 
or expends funds pursuant to the contract under this Part, the tribe 
which requested the contract must submit a report to the Contracting 
Officer. The report shall include, but not be limited to, an accounting 
of the amounts and purposes for which the contract funds were expended 
and information on the conduct of the program or services involved. The 
report shall include any other information requested by the Contracting 
Officer and may be submitted as follows:
    (i) When the contract is with the governing body of an Indian tribe, 
the tribe shall submit the reports to the Contracting Officer.
    (ii) When the contract is with a tribal organization other than the 
governing body of the tribe, the tribe has the option of having the 
tribal organization prepare the report and submit it to the tribe for 
review and approval before the tribe submits it to the Contracting 
Officer.
    (iii) When the contract benefits more than one tribe, the tribal 
organization shall prepare and submit the report to each of the tribes 
benefiting under the contract. Each tribe shall endorse the report 
before submitting it to the Contracting Officer.
    (2) The annual report shall be submitted to the Contracting Officer 
within 90 days of the end of the fiscal year in which the contract was 
performed. However, the period for submitting the report may be extended 
if there is just cause for such extension.
    (3) In addition to the yearly reporting requirement given in 
paragraphs (a) and (b) of this section, the tribal contractor shall 
furnish other reports when and as required by the Secretary.

                             (End of clause)

          Clause No. 28--Questionnaires and Surveys (June 1977)

    In the event the performance of this contract involves the 
collection of information upon identical items from 10 or more persons, 
other than Federal employees, the Contractor shall obtain written 
approval from the Contracting Officer, prior to the use thereof, of any 
forms, schedules, questionnaires, survey plans or other documents, and 
any revisions thereto, intended to be used in such collection.

                             (End of clause)

                   Clause No. 29--Printing (June 1977)

    Unless otherwise specified in this contract, the Contractor shall 
not engage in, nor subcontract for, any printing (as that term is 
defined in Title I of the Government Printing and Binding Regulations in 
effect on the effective date of this contract) in connection with the 
performance of work under this contract: Provided, however, That 
performance of a requirement under this contract involvingthe 
reproduction of less than 5,000 production units of any one page, or 
less than 25,000 production units in the aggregate of multiple pages, 
will not be deemed to be printing. A production unit is defined as one 
sheet, size 8 by 10 and \1/2\ inches, one side only, one color.

                             (End of clause)

      Clause No. 30--Price Reduction for Defective Cost or Pricing

    The following clause applies to all contracts where cost and pricing 
data is required in accordance with P.L. 87-653.

     Price Reduction for Defective Cost or Pricing Data (June 1977)

    (a) If the Contracting Officer determines that any price negotiated 
in connection with this contract or any cost reimbursable under this 
contract was increased by any significant sums because the Contractor, 
or any subcontractor pursuant to the clause of this contract entitled 
``Subcontractor Cost, or Pricing Data'' or ``Subcontractor Cost or 
Pricing Data--Price Adjustments,'' or any

[[Page 204]]

subcontract clause therein required, furnished incomplete or inaccurate 
cost or pricing data or data not current as certified in its 
Contractor's Certificate of Current Cost or Pricing Data, then such 
price or cost shall be reduced accordingly and the contract shall be 
modified in writing to reflect such reduction.
    (b) Failure to agree on a reduction shall be a dispute concerning a 
question of fact within the meaning of the ``Disputes'' clause of this 
contract.
(Note: Since the contract is subject to reduction under this clause by 
reason of defective cost or pricing data submitted in connection with 
certain subcontracts, it is expected that the Contractor may wish to 
include a clause in each such subcontract requiring the subcontractor to 
appropriately indemnify the Contractor. It is also expected that any 
subcontractor subject to such indemnification will generally require 
substantially similar indemnification for defective cost or pricing data 
required to be submitted by its lower tier subcontractors).

                             (End of clause)

           Clause No. 31--Subcontractor Cost and Pricing Data

    The following clause should be included in all contracts when the 
subcontracts of the type and size described therein are contemplated.

             Subcontractor Cost and Pricing Data (June 1977)

    (a) The Contractor shall require subcontractors hereunder to submit 
in writing cost or pricing data under the following circumstances:
    (1) Prior to award of any cost-reimbursed type, time and material, 
labor-hour, incentive, or price redeterminable subcontract the price of 
which is expected to exceed $100,000; and
    (2) Prior to the award of any other subcontract, the price of which 
is expected to exceed $100,000, or to the pricing of any subcontract 
change or other modification for which the price adjustment is expected 
to exceed $100,000, where the price or price adjustment is not based on 
adequate price competition, established catalog or market prices of 
commercial items sold in substantial quantities to the general public, 
or prices set by law or regulation.
    (b) The Contractor shall require subcontractors to certify, 
substantially the same form as that used in the certificate by the Prime 
Contractor to the Government, that, to the best of their knowledge and 
belief, the cost and pricing data submitted under (a) above are 
accurate, complete, and current as of the date of the execution, which 
date shall be as close as possible to the date of agreement on the 
negotiated price of the subcontract or subcontract change or 
modification.
    (c) The contractor shall insert the substance of this clause 
including this paragraph (c) in each of its cost-reimbursement type, 
time and material, labor-hour, price redeterminable, or incentive 
subcontracts hereunder, and in any other subcontract hereunder which 
exceeds $100,000 unless the price thereof is based on adequate price 
competition, established catalog or market prices of commercial items 
sold in substantial quantities to the general public, or prices set by 
law or regulation. In each such excepted subcontract hereunder which 
exceeds $100,000, the Contractor shall insert the substance of the 
following clause:

          Subcontractor Cost and Pricing Data--Price Adjustment

    (a) Paragraphs (b) and (c) of this clause shall become operative 
only with respect to any change or other modification made pursuant to 
one or more provisions of this contract which involves a price 
adjustment in excess of $100,000. The requirements of this clause shall 
be limited to such price adjustments.
    (b) The Contractor shall require subcontractors hereunder to submit 
cost or pricing data under the following circumstances:
    (1) Prior to award of any cost-reimbursement type, time and 
material, labor-hour, incentive, or price redeterminable subcontract, 
the price of which is expected to exceed $100,000; and
    (2) Prior to award of any other subcontract, the price of which is 
expected to exceed $100,000, or to the pricing of any subcontract change 
or other modification for which the price adjustment is expected to 
exceed $100,000, where the price or price adjustment is not based on 
adequate price competition, established catalog or market prices of 
commercial items sold in substantial quantities to the general public, 
or prices set by law or regulation.
    (c) The Contractor shall require subcontractors to certify, in 
substantially the same form as that used in the Certificate by the Prime 
Contractor to the Government, that, to the best of their knowledge and 
belief, the cost and pricing data submitted under (b) above are 
accurate, complete, and current as of the date of the execution, which 
date shall be as close as possible to the date of agreement on the 
negotiated price of the contract modification.
    (d) The Contractor shall insert the substance of this clause 
including this paragraph (d) in each subcontract hereunder which exceeds 
$100,000.

[[Page 205]]

                             (End of clause)

               Clause No. 32--Advance Payment (June 1977)

    (a) Amount of Advance. At the request of the Contractor, and subject 
to the conditions hereinafter set forth, the Government shall make an 
advance payment, or advance payments from time to time, to the 
Contractor. No advance payment shall be made (1) without the approval of 
the office administering advance payments (hereinafter called the 
``Administering Office'' and designated in paragraph (k)(4) hereof) as 
with all advance payments theretofore made, shall exceed the amount 
stated in paragraph (k)(1) hereof; and (3) without a properly certified 
invoice or invoices.
    (b) Special Bank Account. Until all advance payments made hereunder 
are liquidated and the Administering Office approves in writing the 
release of any funds due and payable to the Contractor, all advance 
payments and all other payments under the contract shall be made by 
check payable to the Contractor, and be marked for deposit only in a 
Special Bank Account with the bank designated in paragraph (k)(2) 
hereof. No part of the funds in the Special Bank Account shall be 
mingled with other funds of the Contractor prior to withdrawal thereof 
from the Special Bank Account as hereinafter provided. Except as 
hereinafter provided, each withdrawal shall be made only by check of the 
Contractor countersigned on behalf of the Government by the Contracting 
Officer or such other person or persons as he/she may designate in 
writing (hereinafter called the ``Countersigning Agent''). Until 
otherwise determined by the Administering Office, countersignature on 
behalf of the Government will not be required.
    (c) Use of Funds. The funds in the Special Bank Account may be 
withdrawn by the Contractor solely for the purpose of making payments 
for items of allowable cost or to reimburse the Contractor for such 
items of allowable cost, and or such other purposes as the Administering 
Office may approve in writing. Any interpretation required as to the 
proper use of funds shall be made in writing by the Administering 
Office.
    (d) Return of Funds. The Contractor may at any time repay all or any 
part of the funds advanced hereunder. Whenever so requested in writing 
by the Administering Office, the Contractor shall repay to the 
Government such part of the unliquidated balance of advance payments as 
shall in the opinion of the Administering Office be in excess of current 
requirements, or (when added to total advance previously made and 
liquidated) in excess of the amount specified in paragraph (k)(1) 
hereof. In the event the Contractor fails to repay such part of the 
unliquidated balance of advance payments when so requested by the 
Administering Office, all or any part thereof may be withdrawn from the 
Special Bank Account by checks payable to the Treasurer of the United 
States signed solely by the Countersigning Agent and applied in 
reduction of advance payments then outstanding hereunder.
    (e) Liquidation. If not otherwise liquidated, the advance payments 
made hereunder shall be liquidated as herein provided. When the sum of 
all payments under this contract, other than advance payments, plus the 
unliquidated amount of advance payments are equal to the total estimated 
cost for the work under this contract or such lesser amount to which the 
total estimated cost under this contract may have been reduced, plus 
increases, if any, in this total estimated cost not exceeding, in the 
aggregate (including, without limitation, reimbursable costs incident to 
termination for cause and retrocession as estimated by the Contracting 
Officer), the Government shall thereafter withhold further payments to 
the Contractor and apply the amounts withheld against the Contractor's 
obligation to repay such advance payments until such advance payments 
shall have been fully liquidated. If upon completion, termination, or 
retrocession of the contract all advance payments have not been fully 
liquidated, the balances therefor shall be deducted from any sums 
otherwise due or which may become due to the Contractor from the 
Government, and any deficiency shall be paid by the Contractor to the 
government upon demand.
    (f) Bank Agreement. Before an advance payment is made hereunder, the 
Contractor shall transmit to the Administering Office, in the form 
prescribed by such office, an Agreement in triplicate from the bank in 
which the Special Bank Account is established, clearly setting forth the 
special character of the account and the responsibilities of the bank 
thereunder. Wherever possible, such bank shall be a member bank of the 
Federal Reserve System, or an ``insured'' bank within the meaning of the 
Act creating the Federal Deposit Insurance Corporation Act of August 23, 
1935, 49 Stat. 685, as amended (12 U.S.C. 264).
    (g) Lien on Special Bank Account. The Government shall have a lien 
upon any balance in the Special Bank Account paramount to all other 
items, which lien shall secure the repayment or any advance payments 
made hereunder.
    (h) Lien on Property under Contract. Any and all advance payments 
made under this contract shall be secured, when made, by a lien in favor 
of the Government, paramount to all other liens, upon the supplies or 
other things covered by this contract and on all material and other 
property acquired for or allocated to the performance of this contract, 
except to the extent that the Government by virtue of any other 
provision of this contract, or otherwise, shall have valid title

[[Page 206]]

to such supplies, materials, or other property as against other 
creditors of the Contractor. The Contractor shall identify, by marking 
or segregation, all property which is subject to a lien in favor of the 
Government by virtue of any provision of this contract in such a way as 
to indicate that it is subject to such lien and that it has been 
acquired for or allocated to the performance of this contract. If for 
any reason such supplies, materials, or other property are not 
identified by marking or segregation, the Government shall be deemed to 
have a lien to the extent of the Government's interest under this 
contract on any mass of property with which such supplies, materials, or 
other property are commingled. The Contractor shall maintain adequate 
accounting control over such property on its books and records. If at 
any time during the progress of the work on the contract it becomes 
necessary to deliver any item or items and materials upon which the 
Government has a lien as aforesaid to a third person, the Contractor 
shall notify such third person of the lien herein provided and shall 
obtain from such third person a receipt, in duplicate, acknowledging, 
inter alia the existence of such lien. A copy of each receipt shall be 
delivered by the Contractor to the Contracting Officer. If this contract 
is terminated in whole or in part and the Contractor is authorized to 
sell or retain termination inventory acquired for or allocated to this 
contract, such sale or retention shall be made only if approved by the 
Contracting Officer, which approval shall constitute a release of the 
Government's lien hereunder to the extent that such termination 
inventory is sold or retained, and to the extent that the proceeds of 
the sale, or the credit allowed for such retention on the Contractor's 
termination claim, is applied in reduction of advance payments then 
outstanding hereunder.
    (i) Insurance. The Contractor represents and warrants that it is now 
maintaining with responsible insurance carriers, (1) insurance upon its 
own plant and equipment against fire and other hazards to the extent 
that like properties are usually insured by other operating plants and 
properties of similar character in the same general locality; (2) 
adequate insurance against liability on account of damage to persons or 
property; and (3) adequate insurance under all applicable workmen's 
compensation laws. The Contractor agrees that, until work under this 
contract has been completed and all advance payments made hereunder have 
been liquidated, it will (i) maintain such insurance; (ii) maintain 
adequate insurance upon any materials, parts, assemblies, subassemblies, 
supplies, equipment and other property acquired for or allocable to this 
contract and subject to the Government lien hereunder; and (iii) furnish 
such certificates with respect to its insurance as the Administering 
Office may from time to time require.
    (j) Prohibition against Assignment. Notwithstanding any other 
provision of this contract, the Contractor shall not transfer, pledge, 
or otherwise assign this contract, or any interest therein, or any claim 
arising thereunder, to any party or parties, bank, trust company, or 
other financing institution.
    (k) Designations and Determinations. (1) Amount. The amount of 
advance payments at any time outstanding hereunder shall not exceed $--
----.
    (2) Depository. The bank designated for the deposit of payments made 
hereunder shall be:
    (3) Interest Charge. No interest shall be charged for advance 
payments made hereunder. The Contractor shall charge interest at the 
rate of 6 percent per annum on subadvances or down payments to 
subcontractors, and such interest will be credited to the account of the 
Government. However, interest need not be charged on subadvances on 
nonprofit subcontracts with nonprofit educational or research 
institutions for experimental, research or development work.
    (4) Administering Office. The office administering advance payments 
shall be the office designated as having responsibility for awarding the 
contract.
    (l) Other Security. The terms of this contract shall be considered 
adequate security for advance payments hereunder, except that if at any 
time the administering office deems the security furnished by the 
Contractor to be inadequate, the Contractor shall furnish such 
additional security as may be satisfactory to the administering office, 
to the extent that such additional security is available.

                             (End of clause)

          Clause No. 33--Effect on Existing Rights (June 1977)

    (a) Nothing in this contract shall be construed as:
    (1) Affecting, modifying, diminishing, or otherwise impairing the 
sovereign immunity for suit enjoyed by an Indian tribe; or
    (2) Authorizing or requiring the termination of any existing trust 
responsibility of the United States with respect to the Indian people.

                             (End of clause)

       Clause No. 34--Federal, State, and Local Taxes (June 1977)

    (a) Except as may be otherwise provided in this contract, the 
contract price includes all applicable Federal, State, and local taxes 
and duties.
    (b) Nevertheless, with respect to any Federal excise tax or duty on 
the transactions or

[[Page 207]]

property covered by this contract, if a statute, court decision, written 
ruling, or regulation takes effect after the contract date, and (1) 
Results in the Contractor being required to pay or bear the burden of 
any such Federal excise tax or duty or increase in the rate thereof 
which would not otherwise have been payable on such transactions or 
property, the contract price shall be increased by the amount of such 
tax or duty or rate increase; Provided, That the Contractor if requested 
by the Contracting Officer, warrants in writing that no amount for such 
newly imposed Federal excise tax or duty or rate increase was included 
in the contract price as a contingency reserve or otherwise; or
    (2) Results in the Contractor not being required to pay or bear the 
burden of, or in its obtaining a refund or drawback of, any such Federal 
excise tax or duty which would otherwise have been payable on such 
transactions or property or which was the basis of an increase in the 
contract price, the contract price shall be decreased by the amount of 
the relief, refund, or drawback, or the amount shall be paid to the 
Government, as directed by the Contracting Officer. The contract price 
shall be similarly decreased if the Contractor, through its fault or 
negligence or its failure to follow instructions of the Contracting 
Officer, is required to pay or bear the burden of, or does not obtain, a 
refund or drawback of, any such Federal excise tax or duty.
    (c) No adjustment pursuant to paragraph (b) above will be made under 
this contract unless the aggregate amount thereof is or may reasonably 
be expected to be over $100.
    (d) As used in paragraph (b) above, the term ``contract date'' means 
the date set for the bid opening, or if this is a negotiated contract, 
the date of this contract. As to additional supplies or services 
procured by modification to this contract, the term ``contract date'' 
means the date of such modification.
    (e) Unless there does not exist any reasonable basis to sustain an 
exemption, the Government, upon request of the Contractor, without 
further liability, agrees, except as otherwise provided in this 
contract, to furnish evidence appropriate to establish exemption from 
any tax which the Contractor warrants in writing was excluded from the 
contract price. In addition, the Contracting Officer may furnish 
evidence to establish exemption from any tax that may, pursuant to this 
clause, give rise to either an increase or decrease in the contract 
price. Except as otherwise provided in this contract, evidence 
appropriate to establish exemption from duties will be furnished only at 
the direction of the Contracting Officer.
    (f) The Contractor shall promptly notify the Contracting Officer of 
matters which will result in either an increase or decrease in the 
contract price, and shall take action with respect thereto as directed 
by the Contracting Officer.

                             (End of clause)

[49 FR 36242, Sept. 14, 1984, as amended at 51 FR 20491, June 5, 1986]



PHS 352.280-6  Demurrage charge provisions for reusable cylinders and containers.

    The clause set forth below shall be inserted in solicitations and 
resultant contracts when delivery of the items may be in contractor-
furnished reusable gas cylinders or other containers.

 Demurrage Charge Provisions for Reusable Cylinders and Containers (Apr 
                                  1984)

    (a) Reusable gas cylinders or other containers identified below by 
offereors shall remain the property of the Contractor (except as 
provided in (c) below), and will be loaned without charge to the 
Government for the period stipulated below. In computing the period 
involved, such free loan period shall commence on the first day after 
date of delivery of each container to the herein specified f.o.b. 
point(s). Offerors who specify less than -------- days (to be determined 
by the Contracting Officer in accordance with trade custom), shall have 
their offers increased for evaluation purposes only by an amount arrived 
at by multiplying the number of days less than the established free loan 
period by the daily rental charge. In the event the offeror does not 
specify a free loan period, such period shall be -------- days (insert 
the same number of days as the established free loan period). Beginning 
with the first day after expiration of the free loan period to and 
including the date the containers are delivered to the Contractor's 
designated carrier, the Government shall pay the Contractor demurrage 
(rental) in the amount specified below. No demurrage shall accrue to the 
Contractor in excess of the herein specified container's replacement 
value. For each container lost or damaged beyond repair while in the 
Government's possession, the Government shall pay to the Contractor the 
herein specified replacement value less allocable demurrage paid 
therefor. Such lost or damaged containers paid for by the Government 
shall become the property of the Government.
    (b) Empty containers will be delivered to the Contractor's 
designated carrier (offeror to identify applicable carrier below) f.o.b. 
points of original delivery specified in this solicitation/contract.

[[Page 208]]



                 Offerors Shall Furnish the Following Information, as Applicable, for Containers                
----------------------------------------------------------------------------------------------------------------
                                                                                               Demurrage charges
       Applicable item No.         Type and size of        Quantity        Free loan period       per day per   
                                       container                                                   cylinder     
----------------------------------------------------------------------------------------------------------------
                                                                                                                
                                                                                                                
                                                                                                                
----------------------------------------------------------------------------------------------------------------


                                                                        
------------------------------------------------------------------------
                                          Identification and location of
  Replacement value for each container   offeror's carrier for return of
                                                 empty container        
------------------------------------------------------------------------
                                                                        
------------------------------------------------------------------------

    (c) When the offeror indicates that containers have a replacement 
value of less than $10, the Government shall have the option to purchase 
containers and add the cost to the offered price. When purchase option 
is exercised, offers shall be evaluated accordingly. In this event, the 
container shall become the property of the Government.

                             (End of clause)



            Subpart PHS 352.3--Provision and Clause Matrices



PHS 352.380-4  Contract clauses for contracts awarded under the Indian Self-Determination Act.

    (a) PHS Acquisition Regulations (PHSAR) Clauses for Cost-
Reimbursement Contracts Awarded under the Indian Self-Determination Act.

         Number, PHSAR Clause No., and Title and Date of Clause

1. 352.280-4(a)(1)  Definitions. (June 1977)
2. 352.280-4(a)(2)  Disputes. (June 1977)
3. 352.280-4(a)(3)  Limitation of Cost. (June 1977)
4. 352.280-4(a)(4)  Allowable Cost. (June 1977)
5. 352.280-4(a)(5)  Negotiated Overhead Rates. (June 1977)
6. 352.280-4(a)(6)  Payment (June 1977)
7. 352.280-4(a)(7)  Advance Payment. (June 1977)
8. 352.280-4(a)(8)  Examination of Records. (June 1977)
9. 352.280-4(a)(9)  Inspection and Reports. (June 1977)
10. 352.280-4(a)(10)  Subcontracting. (June 1977)
11. 352.280-4(a)(11)  Accounts, Audit, and Records. (June 1977)
12. 352.280-4(a)(12)  Government Property. (June 1977)
13. 352.280-4(a)(13)  Changes. (June 1977)
14. 352.280-4(a)(14)  Notice to the Government of Delays. (June 1977)
15. 352.280-4(a)(15)  Retrocession. (June 1977)
16. 352.280-4(a)(16)  Reassumption of Programs. (June 1977)
17. 352.280-4(a)(17)  Key Personnel. (June 1977)
18. 352.280-4(a)(18)  Litigation and Claims. (June 1977)
19. 352.280-4(a)(19)  Indemnity and Insurance. (June 1977)
20. 352.280-4(a)(20)  Overtime. (June 1977)
21. 352.280-4(a)(21)  Foreign Travel. (June 1977)
22. 352.280-4(a)(22)  Questionnaires and Surveys. (June 1977)
23. 352.280-4(a)(23)  Printing. (June 1977)
24. 352.280-4(a)(24)  Services of Consultants. (June 1977)
25. 352.280-4(a)(25)  Assignment of Claims. (June 1977)
26. 352.280-4(a)(26)  Contract Work Hours and Safety Standards Act-
Overtime Compensation. (June 1977)
27. 352.280-4(a)(27)  Walsh-Healey Public Contracts Act. (June 1977)
28. 352.280-4(a)(28)  Equal Opportunity. (June 1977)
29. 352.280-4(a)(29)  Indian Preference in Training and Employment. 
(June 1977)
30. 352.280-4(a)(30)  Certificate of Nonsegregated Facilities. (June 
1977)
31. 352.280-4(a)(31)  Convict Labor. (June 1977)
32. 352.280-4(a)(32)  Officials not to Benefit. (June 1977)
33. 352.280-4(a)(33)  Buy American Act Supply and Service contracts. 
(June 1977)
34. 352.280-4(a)(34)  Anti-Kickback Act. (June 1977)
35. 352.280-4(a)(35)  Use of Indian Business Concerns. (June 1977)
36. 352.280-4(a)(36)  Payment of Interest on Contractors' Claims. (June 
1977)
37. 352.280-4(a)(37)  Fair and Equal Treatment of Indian People. (June 
1977)
38. 352.280-4(a)(38)  Price Reduction for Defective Cost or Pricing 
Data. (June 1977)
39. 352.280-4(a)(39)  Subcontractor Cost and Pricing Data. (June 1977)
40. 352.280-4(a)(40)  Penalties. (June 1977)
41. 352.280-4(a)(41)  Effect on Existing Rights. (June 1977)
42. 352.280-4(a)(42)  General Services Administration Supply Sources. 
(June 1977)

    (b) PHSAR Clauses for Fixed-Price Contracts Awarded under the Indian 
Self-Determination Act.

          Number, PHSAR Clause No. and Title and Date of Clause

1. 352.280-4(b)(1)  Definitions. (June 1977)
2. 352.280-4(b)(2)  Disputes. (June 1977)
3. 352.280-4(b)(3)  Contract Work Hours and Safety Standards Act-
Overtime Compensation. (June 1977)
4. 352.280-4(b)(4)  Walsh-Healey Public Contracts Act. (June 1977)
5. 352.280-4(b)(5)  Convict Labor. (June 1977)

[[Page 209]]

6. 352.280-4(b)(6)  Notice to the Government of Delays. (June 1977)
7. 352.280-4(b)(7)  Assignment of Claims. (June 1977)
8. 352.280-4(b)(8)  Officials not to Benefit. (June 1977)
9. 352.280-4(b)(9)  Anti-Kickback Act. (June 1977)
10. 352.280-4(b)(10)  Penalties. (June 1977)
11. 352.280-4(b)(11)  Buy American Act. (June 1977)
12. 352.280-4(b)(12)  Equal Opportunity. (June 1977)
13. 352.280-4(b)(13)  Certificate of Nonsegregated Facilities. (June 
1977)
14. 352.280-4(b)(14)  Subcontracting. (June 1977)
15. 352.280-4(b)(15)  Competition in Subcontracting. (June 1977)
16. 352.280-4(b)(16)  Use of Indian Business Concerns. (June 1977)
17. 352.280-4(b)(17)  Indian Preference in Training and Employment. 
(June 1977)
18. 352.280-4(b)(18)  Inspection. (June 1977)
19. 352.280-4(b)(19)  Changes. (June 1977)
20. 352.280-4(b)(20)  Retrocession. (June 1977)
21. 352.280-4(b)(21)  Assumption and Reassumption of Contract Programs. 
(June 1977)
22. 352.280-4(b)(22)  Payment of Interest on Contractor's Claims. (June 
1977)
23. 352.280-4(b)(23)  Government-Furnished Property. (June 1977)
24. 352.280-4(b)(24)  Examination of Records by the Comptroller General. 
(June 1977)
25. 352.280-4(b)(25)  Indemnity and Insurance. (June 1977)
26. 352.280-4(b)(26)  Fair and Equal Treatment of Indian People. (June 
1977)
27. 352.280-4(b)(27)  Reports to the Indian People and Annual Reports. 
(June 1977)
28. 352.280-4(b)(28)  Questionnaires and Surveys. (June 1977)
29. 352.280-4(b)(29)  Printing. (June 1977)
30. 352.280-4(b)(30)  Price Reduction for Defective Cost or Pricing. 
(June 1977)
31. 352.280-4(b)(31)  Subcontractor Cost and Pricing Data. (June 1977)
32. 352.280-4(b)(32)  Advance Payment. (June 1977)
33. 352.280-4(b)(33)  Effect on Existing Rights. (June 1977)
34. 352.280-4(b)(34)  Federal, State, and Local Taxes. (June 1977)

[[Page 210]]



                   SUBCHAPTER T--PHS SUPPLEMENTATIONS





PART PHS 380--SPECIAL PROGRAM REQUIREMENTS AFFECTING PHS ACQUISITIONS--Table of Contents




        Subpart PHS 380.1--Acquisitions Involving Human Subjects

Sec.
PHS 380.101  Applicability.
PHS 380.102  Policy.
PHS 380.103  Assurances.
PHS 380.104  Notice to offerors.
PHS 380.105  Contract clause.

 Subpart PHS 380.2--Acquisitions Involving the Use of Laboratory Animals

PHS 380.201  Scope of subpart.
PHS 380.202  Definitions.
PHS 380.203  Policy.
PHS 380.204  Applicability.
PHS 380.205  Contractor implementation.
PHS 380.206  PHS implementation.

      Subpart PHS 380.3--Acquisition of Drugs and Medical Supplies

PHS 380.301  Scope of subpart.
PHS 380.302  Acquisition of drugs.
PHS 380.302-1  Policy.
PHS 380.302-2  Solicitation and contract requirements.
PHS 380.303  Acquisition of controlled drugs.
PHS 380.304  Effectiveness of drug products.
PHS 380.304-1  General.
PHS 380.304-2  Policy.
PHS 380.304-3  Procedures.
PHS 380.304-4  Distribution of information.
PHS 380.305  Maximum allowable cost for drugs.
PHS 380.305-1  General.
PHS 380.305-2  Applicability.
PHS 380.305-3  Responsibilities.
PHS 380.305-4  Solicitation notification.
PHS 380.305-5  Contract requirements.
PHS 380.306  Acquisition of tax free and specially denatured alcohol.

  Subpart PHS 380.4--Contracts Under the Indian Self-Determination Act

PHS 380.400  Scope of subpart.
PHS 380.401  Applicability of regulations.
PHS 380.402  Waivers.
PHS 380.403  Negotiating authority.
PHS 380.404  Definitions.
PHS 380.405  Types of contracts.
PHS 380.406  Term of contract.
PHS 380.407  Exemption from bonds.
PHS 380.408  Acquisition of construction and architect-engineering 
          service contracts.
PHS 380.409  Performance of personal services.
PHS 380.410  Special provisions of Indian Self-Determination contract.
PHS 380.411  Contract provisions.

        Subpart PHS 380.5--Acquisitions Under the Buy Indian Act

PHS 380.500  Scope of subpart.
PHS 380.501  Policy.
PHS 380.502  Definitions.
PHS 380.502-1  Indian.
PHS 380.502-2  Indian firm.
PHS 380.502-3  Product of Indian industry.
PHS 380.502-4  Buy Indian contract.
PHS 380.502-5  Buy Indian restricted advertising.
PHS 380.503  Requirements.
PHS 380.504  Competition.
PHS 380.505  Responsibility determinations.

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

    Source:  49 FR 36263, Sept. 14, 1984, unless otherwise noted.



        Subpart PHS 380.1--Acquisitions Involving Human Subjects

    Source:  51 FR 20491, June 5 1986, unless otherwise noted.



PHS 380.101  Applicability.

    This subpart applies to all research and development contracts 
involving human subjects except those that are exempt by Secretarial 
waiver under 45 CFR 46.101(e) or exempt under 45 CFR 46.101(b).



PHS 380.102  Policy.

    (a) Safeguarding the rights and welfare of human subjects in 
activities under Public Health Service (PHS) research and development 
contracts is the responsibility of each institution that receives or is 
accountable to PHS for funds awarded for the conduct of that activity. 
To assure that this institutional responsibility is met, PHS shall not 
permit a nonexempt research activity involving human subjects to be 
undertaken unless the institution has an assurance on file with the 
Office for Protection from Research Risks (OPRR), NIH/PHS, and has filed 
a certification that an institutional review board (IRB) has reviewed 
and approved the activity in accordance with 45 CFR Part 46.

[[Page 211]]

    (b) Contracts involving human subjects will not be awarded to an 
individual unless he/she is affiliated with or sponsored by an 
institution which can and will assume responsibility for safeguarding 
the human subjects involved.



PHS 380.103  Assurances.

    In accordance with 45 CFR 46.103, OPRR is responsible for 
negotiation of assurances covering all PHS-supported research activities 
involving human subjects. Consultation with OPRR (telephone: 301-496-
7041) is recommended on issues regarding assurances, certification of 
IRB review and approval, and interpretation of the regulations for the 
protection of human subjects in 45 CFR Part 46.



PHS 380.104  Notice to offerors.

    Solicitations shall contain the notice to offerors set forth in PHS 
352-280-1(a) whenever contract performance is expected to involve human 
subjects.



PHS 380.105  Contract clause.

    The clause set forth in PHS 352.280-1(b) shall be inserted in all 
contracts involving human subjects.



 Subpart PHS 380.2--Acquisitions Involving the Use of Laboratory Animals

    Source:  51 FR 20492, June 5 1986, unless otherwise noted.



PHS 380.201  Scope of subpart.

    This subpart describes Public Health Service (PHS) contracts for 
projects or activities involving animals, and the responsibilities of 
the PHS agencies and subordinate elements for implementing policies and 
procedures described herein.



PHS 380.202  Definitions.

    (a) Animal. Any live, vertebrate animal used or intended for use in 
research, research training, experimentation or biological testing or 
for related purposes.
    (b) Animal facility. Any building, room, area, enclosure, or 
vehicle, including satellite facility, used for animal confinement, 
transport, maintenance, breeding or experiments of surgical 
manipulation. A satellite facility is any containment outside of a core 
facility or centrally designated or managed area in which animals are 
housed for more than 24 hours.
    (c) Animal Welfare Act. Pub. L. 89-544, 1966, as amended (Pub. L. 
91-579 and Pub. L. 94-279) 7 U.S.C. 2131 et seq. Implementing 
regulations are published in the Code of Federal Regulations (CFR), 
Title 9, Subchapter A, Parts 1, 2, 3, and 4, and are administered by the 
U.S. Department of Agriculture.
    (d) Animal Welfare Assurance or Assurance. The documentation from an 
awardee or a prospective awardee institution assuring institutional 
compliance with this policy.
    (e) Guide. Guide for the Care and Use of Laboratory Animals, NIH 
Pub. No. 85-23, 1985 edition or succeeding revised editions.
    (f) Institution. Any public or private organization, business, or 
agency (including components of Federal, State and local governments).
    (g) Institutional official. An individual who has the authority to 
sign the institution's Assurance, making a commitment on behalf of the 
institution that the requirement of this subpart will be met.
    (h) Public Health Service. The Public Health Service includes the 
Office of the Assistant Secretary for Health; the Alcohol, Drug Abuse, 
and Mental Health Administration; the Centers for Disease Control; the 
Food and Drug Administration; the Health Resources and Services 
Administration; and the National Institutes of Health.
    (i) Quorum. A majority of the members of the Institutional Animal 
Care and Use Committee.



PHS 380.203  Policy.

    It is the policy of PHS to require institutions to establish and 
maintain proper measures to ensure the appropriate care and use of all 
animals involved in research, research training and biological testing 
(hereinafter referred to as activities) supported by PHS. PHS endorses 
the ``U.S. Government Principles for the Utilization and Care of 
Vertebrate Animals Used in Testing, Research and Training'' developed by 
the Interagency Research Animal Committee (IRAC). This policy is

[[Page 212]]

intended to implement and supplement those Principles.



PHS 380.204  Applicability.

    (a) This policy is applicable to all PHS-supported activities 
involving animals, whether the activities are performed at an awardee 
institution, or any other institution, in the United States, the 
Commonwealth of Puerto Rico, or any territory or possession of the 
United States. Institutions in foreign countries receiving PHS support 
for activities involving animals shall comply with this policy, or 
provide evidence to PHS that acceptable standards for the humane care 
and use of the animals in PHS-supported activities will be met.
    (b) No PHS support for an activity involving animals will be 
provided to an individual unless that individual is affiliated with or 
sponsored by an institution which can and does assume responsibility for 
compliance with this policy for PHS-supported activities, or unless the 
individual makes other arrangements with PHS.
    (c) This policy does not supercede or preempt applicable State or 
local laws or regulations which impose more stringent standards for the 
care and use of laboratory animals. All institutions are required to 
comply, as applicable, with the Animal Welfare Act, and other Federal 
statutes and regulations relating to animals.



PHS 380.205  Contractor implementation.

    (a) Animal Welfare Assurance. No activity involving animals will be 
supported by PHS until the institution conducting the activity has 
provided a written Assurance acceptable to PHS, setting forth compliance 
with the policy in this subpart for PHS-supported activities. Assurances 
shall be submitted to OPRR, Office of the Director, National Institutes 
of Health, 9000 Rockville Pike, Building 31, Room 4B09, Bethesda, 
Maryland 20892. The Assurance shall be typed on the institution's 
letterhead and signed by an institutional official. OPRR will provide 
the applicant institution with necessary instructions and an example of 
an acceptable Assurance. All Assurances submitted to PHS in accordance 
with the policy will be evaluated by OPRR to determine the adequacy of 
the institution's proposed program for the care and use of animals in 
PHS-supported activities. On the basis of this evaluation, OPRR may 
approve or disapprove the Assurance, or negotiate an acceptable 
Assurance with the institution. Approval of an Assurance will be for a 
specified period of time (no longer than five years) after which time 
the institution must submit a new Assurance to OPRR. OPRR may limit the 
period during which any particular approved Assurance shall remain 
effective or otherwise condition, restrict, or withdraw approval. 
Without an applicable PHS approved Assurance, no PHS-supported activity 
involving animals at the institution will be permitted to continue.
    (1) Institutional program for animal care and use. The Assurance 
shall fully describe the institution's program for the care and use of 
animals in PHS-supported activities. PHS requires institutions to use 
the Guide for the Care and Use of Laboratory Animals (Guide) as a basis 
for developing and implementing an institutional program for activities 
involving animals. The program description must include the following:
    (i) A list of every branch and major component of the institution, 
as well as a list of every branch and major component of any institution 
which is to be included under the Assurance;
    (ii) The lines of authority and responsibility for administering the 
program and ensuring compliance with this policy;
    (iii) The qualifications, authority and responsibility of the 
veterinarian(s) who will participate in the program;
    (iv) The membership list of the Institutional Animal Care and Use 
Committee(s) (IACUC) \1\ established in accordance with the requirements 
set forth in this subpart;
---------------------------------------------------------------------------


    \1\ The name Institutional Animal Care and Use Committee (IACUC) as 
used in this policy is intended as a generic term for a committee whose 
function is to ensure that the care and use of animals in PHS-supported 
activities is appropriate and humane in accordance with this policy. 
However, each institution may identify the committee by whatever name it 
chooses. Membership and responsibilities of the IACUC are set forth in 
PHS 380.205(d).

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

[[Page 213]]

    (v) The procedures which the IACUC will follow to fulfill the 
requirements set forth in this subpart;
    (vi) The health program for personnel who work in laboratory animal 
facilities or have frequent contact with animals;
    (vii) The gross square footage of each animal facility (including 
satellite facilities), the species housed therein and the average daily 
inventory, by species, of animals in each facility; and
    (viii) Any other pertinent information requested by OPRR.
    (2) Institutional status. Each institution must assure that its 
program and facilities are in one of the following categories:
    (i) Category 1-- Accredited by the American Association for the 
Accreditation of Laboratory Animal Care (AAALAC). All of the 
institution's programs and facilities (including satellite facilities) 
for activities involving animals have been evaluated and accredited by 
AAALAC, or another accrediting body recognized by PHS.\2\
---------------------------------------------------------------------------


    \2\ As of the issuance date of this policy the only accrediting body 
recognized by PHS is the American Association for Accredidation of 
Laboratory Animal Care (AAALAC).
---------------------------------------------------------------------------

    (ii) Category 2-- Evaluated by the Institution. All of the 
institution's programs and facilities (including satellite facilities) 
for activities involving animals have been evaluated by the IACUC and 
will be reevaluated by the IACUC at least once each year. The IACUC 
shall use the Guide as a basis for evaluating the institution's program 
and facilities.

A report of the IACUC evaluation shall be submitted to the institutional 
official and updated on an annual basis.\3\ The initial report shall be 
submitted to OPRR with the Assurance. Annual reports of the IACUC 
evaluation shall be maintained by the institution and made available to 
OPRR upon request. The report must contain a description of the nature 
and extent of the institution's adherence to the Guide and this 
policy.\4\ The report must identify specifically any departures from 
provisions of the Guide and this policy, and state the reasons for each 
departure. If program or facility deficiencies are noted, the report 
must contain a reasonable and specific plan and schedule for correcting 
each deficiency. The report must distinguish significant deficiencies 
from minor deficiencies. A significant deficiency is one which, in the 
judgment of the IACUC and the institutional official, is or may be a 
threat to the health or safety of the animals. Failure of the IACUC to 
conduct an annual evaluation and submit the required report to the 
institutional official may result in PHS withdrawal of its approval of 
the Assurance.
---------------------------------------------------------------------------


    \3\ The IACUC may, at its discretion, determine the best means of 
conducting an evaluation of the institution's programs and facilities. 
The IACUC may invite ad hoc consultants to conduct or assist in 
conducting the evaluation. However, the IACUC remains responsible for 
the evaluation and report.

    \4\ If some of the institution's facilities are accredited by AAALAC 
or other accrediting body recognized by PHS, the report should identify 
those facilities and need not contain any further information about 
evaulation of those facilities.
---------------------------------------------------------------------------

    (3) Institutional Animal Care and Use Committee (IACUC). (i) Each 
institution shall appoint an Institutional Animal Care and Use Committee 
(IACUC), qualified through experience and expertise of its members, to 
oversee the institution's animal program, facilities and procedures.
    (ii) The Assurance must include the names, position titles and 
credentials of the IACUC chairperson and the members. The committee 
shall consist of not less than five members, and shall include at least:
    (A) One Doctor of Veterinary Medicine, with training or experience 
in laboratory animal science and medicine, who has direct or delegated 
program responsibility for activities involving animals at the 
institution;
    (B) One practicing scientist experienced in research involving 
animals;
    (C) One member whose primary concerns are in a nonscientific area 
(for example, ethicist, lawyer, member of the clergy); and
    (D) One individual who is not affiliated with the institution in any 
way

[[Page 214]]

other than as a member of the IACUC, and is not a member of the 
immediate family of a person who is affiliated with the institution.
    (iii) An individual who meets the requirements of more than one of 
the categories detailed in PHS 380.205(d)(2)(i)-(iv) above, may fulfill 
more than one requirement. However, no committee may consist of less 
than five members.
    (b) Functions of the Institutional Animal Care and Use Committee. As 
an agent of the institution, the IACUC shall, will respect to PHS-
supported activities:
    (1) Review at least annually the institution's program for humane 
care and use of animals;
    (2) Inspect at least annually all of the institution's animal 
facilities, including satellite facilities;
    (3) Review concerns involving the care and use of animals at the 
institution;
    (4) Make recommendations to the institutional official regarding any 
aspect of the institution's animal program, facilities or personnel 
training;
    (5) Review and approve, require modifications in (to secure 
approval), or withhold approval of those sections of PHS applications or 
proposals related to the care and use of animals, as specified in PHS 
380.205(f) of this subpart;
    (6) Review and approve, require modifications in (to secure 
approval), or withhold approval of proposed significant changes 
regarding the use of animals in ongoing activities; and
    (7) Be authorized to suspend an activity involving animals in accord 
with specifications set forth in this subpart.
    (c) Review of applications and proposals. In order to approve 
applications and proposals or proposed changes in ongoing activities, 
the IACUC shall conduct a review of those sections related to the care 
and use of animals and determine that the proposed activities are in 
accordance with this policy. In making this determination, the IACUC 
shall confirm that the activity will be conducted in accordance with the 
Animal Welfare Act insofar as it applies to the activity, and that the 
activity is consistent with the Guide, unless the IACUC determines that 
acceptable justification for a departure is presented. Furthermore, the 
IACUC shall determine that the activity conforms with the institution's 
Assurance and meets the following requirements:
    (1) Procedures with animals will avoid or minimize discomfort, 
distress and pain to the animals, consistent with sound research design.
    (2) Procedures that may cause more than momentary or slight pain or 
distress to the animals will be performed with appropriate sedation, 
analgesia, or anesthesia, unless the procedure is justified for 
scientific reasons in writing by the investigator.
    (3) Animals that would otherwise experience severe or chronic pain 
or distress that cannot be relieved will be painlessly sacrificed at the 
end of the procedure or, if appropriate, during the procedure.
    (4) The living conditions of animals will be appropriate for their 
species and contribute to their health and comfort. The housing, feeding 
and nonmedical care of the animals will be directed by a veterinarian or 
a scientist trained and experienced in the proper care, handling and use 
of the species being maintained or studied.
    (5) Medical care for animals will be available and provided as 
necessary by a qualified veterinarian.
    (6) Personnel conducting procedures on the species being maintained 
or studies will be appropriately qualified and trained in those 
procedures.
    (7) Methods of euthanasia used will be consistent with the 
recommendations of the American Veterinary Medical Association (AVMA) 
Panel of Euthanasia \5\, unless a deviation is justified for scientific 
reasons in writing by the investigator.
---------------------------------------------------------------------------


    \5\ Journal of the American Veterinary Association (JAVMA), 1978, 
Vol. 143, No. 1, pp. 59-72, or succeeding revised editions.
---------------------------------------------------------------------------



PHS 380.206  Public Health Service implementation.

    (a) Responsibility of the Office for Protection from Research Risks 
(OPRR). OPRR is responsible for the general administration and 
coordination of this policy and will:
    (1) Request and negotiate, approve or disapprove, and, as necessary, 
withdraw approval of Assurances;

[[Page 215]]

    (2) Distribute to executive secretaries of initial review and 
technical evaluation groups, and to PHS contracting offices, lists of 
institutions that have an approved Assurance;
    (3) Advise contracting offices and awardee institutions concerning 
the implementation of this policy;
    (4) Evaluate allegations of noncompliance with this subpart;
    (5) Have the authority to review and approve or disapprove waivers 
of this subpart (see paragraph (d) of this section); and
    (6) With other PHS officials, conduct site visits to selected 
institutions.
    (b) Responsibilities of PHS contracting offices. PHS contracting 
offices shall not make an award for an activity involving animals unless 
the institution submitting the application or proposal is on the list of 
institutions that have an approved Assurance of file with OPRR, and the 
institutional official has provided verification of approval by the 
IACUC of those sections of the application or proposal related to the 
care and use of animals. If an institution is not listed, the 
contracting office shall ask OPRR to negotiate an Assurance with the 
institution before an award is made. No award shall be made until the 
Assurance has been submitted by the institution, approved by OPRR, and 
the institution has provided verification of approval by the IACUC of 
those sections of the application or proposal related to the care and 
use of animals in PHS-supported activities.
    (c) Conduct of special reviews/site visits. Each awardee institution 
is subject to review at any time by PHS staff and advisors, which may 
include a site visit, to assess the adequacy of the institution's 
compliance with this policy.
    (d) Waiver. Institutions may request a waiver of a provision of this 
policy by submitting a request to OPRR. No waiver will be granted unless 
sufficient justification is provided, and the waiver is approved in 
writing by OPRR.



      Subpart PHS 380.3--Acquisition of Drugs and Medical Supplies



PHS 380.301  Scope of subpart.

    This subpart provides policies and procedures pertaining to the 
acquisition of drug products and medical supplies by PHS or PHS's 
contractors.



PHS 380.302  Acquisition of drugs.



PHS 380.302-1  Policy.

    (a) Drugs shall be acquired at the lowest possible price consistent 
with acceptable standards of identity, strength, quality, purity, safety 
and effectiveness, and with due regard for the welfare of the patient 
and the professional judgment of the prescriber.
    (b) Contracting activities shall ensure that drugs are acquired by 
generic name on a competitive basis whenever it is possible to obtain 
therapeutically effective drugs of established quality. However, the 
professional judgment of the prescriber to request drugs by brand name 
or house designation must be recognized when the best interest of the 
patient requires it. Similarly, scientific investigators have the 
prerogative to request drugs having end-product characteristics 
considered necessary for the conduct of research or investigations.
    (c) Prior to taking any acquisition action, the contracting officer 
shall ensure that the requested drug products are not available from 
mandatory sources such as Federal Supply Schedules. Part 103-26 of the 
HHS Material Management Manual describes sources of supply for drugs.



PHS 380.302-2  Solicitation and contract requirements.

    The contracting officer should consider including statements similar 
to the following in solicitations and resultant contracts pertaining to 
drug products:
    (a) The offeror (contractor) guarantees that all requirements 
established by the Food and Drug Administration, HHS, have been met. 
These requirements include: plant sanitation, manufacturing, packaging, 
labeling, identification, strength, quality, purity, safety, and 
effectiveness.

    Note:  The contracting officer may want to cite the applicable 
reference(s) pertaining to the FDA requirements.



[[Page 216]]


    (b) The offeror (contractor), by signing this document, guarantees/
warrants that any applicable shelf-life requirements have been met and 
the furnished drugs are free from defects.
    (c) The Government reserves the right to inspect the manufacturer's 
plant and premises during normal operating hours.

    Note:  FDA will normally conduct the inspection when requested, but 
may request to be reimbursed for the services.

    (d) The offeror (contractor) agrees to submit either a 
comprehensive, certified analysis on each lot of drugs at the time of 
delivery of the drugs, or a comprehensive list of specifications met by 
the drugs along with a certificate of analysis, or other suitable 
documentation, verifying that the drugs meet the appropriate standards.
    (e) The offeror (contractor) claims it is not currently listed as a 
disqualified bidder or offeror for drugs by any Federal agency or 
department.
    (f) The offeror must set forth full, accurate, and complete 
information as required by this solicitation (including attachments). 
The penalty for making false statements in offers is prescribed in 18 
U.S.C. 1001.
    (g) If the offeror (prime contractor) plans to use (or uses) a 
subcontractor or secondary manufacturer for the furnishing of any or all 
the drug products under the resultant contract, the name and address of 
the subcontractor or secondary manufacturer is to be furnished the 
contracting officer, along with the drug lots affected. The prime 
contractor shall ensure that the subcontractor or secondary manufacturer 
complies with the above stated requirements.



PHS 380.303  Acquisition of controlled drugs.

    (a) Controlled drugs include narcotics and dangerous drugs 
identified by the Drug Enforcement Administration (DEA), Department of 
Justice, in the regulations implementing the Comprehensive Drug Abuse 
Prevention and Control Act of 1970 (Title 21 CFR Chapter II).
    (b) The DEA issues a Controlled Substances Inventory List which 
provides general information pertaining to the ordering of controlled 
drug products and the use of specific order forms. The local DEA 
regional office should be contacted to receive the list and instructions 
regarding registering and ordering forms, as well as other matters 
concerning the handling and processing of controlled drugs. Sections 
103-27.6204(a)(2) and 103-27.6302(b) of the HHS Material Management 
Manual provide information on issuing, shipping, and safeguarding 
controlled drugs.
    (c) Contracting officers shall ensure that requests for contracts or 
purchase requests are supported by the required DEA form prior to 
initiation of any action.



PHS 380.304  Effectiveness of drug products.



PHS 380.304-1  General.

    (a) The National Academy of Sciences National Research Council (NAS-
NRC) has established effectiveness classifications for the indication of 
drug products, based upon the following criteria:
    (1) Factual information that is freely available in scientific 
literature;
    (2) Factual information that is available from the Food and Drug 
Administration, the manufacturer, or other sources; and
    (3) Experience and informed judgment of the members of NAS-NRC 
panels.
    (b) The indications mentioned in the following categories refer to 
``the effect the drug purports or is represented to have under the 
conditions of use prescribed, recommended, or suggested in the proposed 
labeling.'' That is, the indications are the claims noted in the 
labeling of a given drug product.
    (1) Category A--Effective. For the presented indication, the drug is 
effective on the basis of the criteria cited in PHS 380.304-1(a) above.
    (2) Category B--Probably Effective. For the indication presented, 
effectiveness of the drug is probable on the basis of the criteria cited 
in PHS 380.304-1(a) but additional evidence is required before it can be 
assigned to Category A.
    (3) Category C--Possibly Effective. In relation to the indication in 
question, there is little evidence of effectiveness under any of the 
criteria cited in PHS

[[Page 217]]

380.304-1(a). The possibility that additional supporting evidence might 
be developed should not be ruled out, however.
    (4) Category D--Ineffective. In relation to the indication in 
question, there is no acceptable evidence under any of the criteria 
cited in PHS 380.304-1(a) to support a claim of effectiveness.



PHS 380.304-2  Policy.

    (a) It is PHS policy to not acquire drug products classified 
``ineffective'' or ``possibly effective'' for use in its direct care 
programs. However, there are two exceptions to this policy:
    (1) Drug products categorized as ``ineffective'' and ``possibly 
effective'' may be acquired for use in the pursuit of approved clinical 
research products.
    (2) Drug products categorized as ``possibly effective'' may be 
acquired when no alternate means of therapy with drug products in the 
``probably effective'' or ``effective'' categories are available.
    (b) This policy applies to similar drug products marketed by the 
same or other firms.



PHS 380.304-3  Procedures.

    (a) The contracting officer, prior to initiating action on a 
purchase request or request for contract for drug products, shall ensure 
that the items are screened against current lists of products identified 
by the Pharmacy Liaison Officer, Public Health Service, to determine 
whether acquisition of the items is prohibited, and that the individual 
actually performing the screening has annotated and initialed the 
request.
    (b) When the request is received for a drug product which is 
allowable under the exceptions stated in PHS 380.304-2, the contracting 
officer shall ensure that the appropriate justification is provided, 
that it is signed by the responsible program official, and that it is 
included in the contract or purchase request file.
    (c) When the request for a restricted drug product cannot be 
resolved by the substitution of another item, the contracting officer 
shall consider the request as a deviation and process it in accordance 
with Subpart 301.4.



PHS 380.304-4  Distribution of information.

    (a) The Pharmacy Liaison Officer, Public Health Service, has 
responsibility for distributing information on the effectiveness of drug 
products to the principal official responsible for acquisition. The 
principal official responsible for acquisition will be advised by 
telephone of drug products classified as ``ineffective'' or ``possibly 
effective'' prior to publication in the Federal Register, and will be 
provided a monthly list of these drug products following publication in 
the Federal Register.
    (b) The principal official responsible for acquisition shall 
establish procedures for the distribution of information on the 
effectiveness of drug products and implement other controls necessary to 
assure compliance with the policy set forth in PHS 380.304-2.



PHS 380.305  Maximum allowable cost for drugs.



PHS 380.305-1  General.

    (a) The regulation entitled ``Limitation on Payment or Reimbursement 
for Drugs,'' also known as the Maximum Allowable Cost or MAC regulation, 
is set forth in Part 19 to Subtitle A of Title 45 of the Code of Federal 
Regulations.
    (b) The MAC regulation established departmental policies and 
procedures for determining allowable drug costs and, where applicable, 
dispensing fees to be used to establish:
    (1) Reimbursement to providers and health maintenance organizations 
under the Medicare program;
    (2) Reimbursement to States under State administered health, 
welfare, and social service programs; and
    (3) Allowable costs under projects for health services.



PHS 380.305-2  Applicability.

    (a) This regulation implements the MAC regulation by establishing 
acquisition procedures consistent with the purpose and intent of the MAC 
regulation.
    (b) This regulation applies to the direct acquistion of drugs by PHS 
and the acquisition or supply of drugs by PHS contractors.

[[Page 218]]

    (c) This regulation does not apply to the acquisition of drugs for 
research programs made by PHS and its contractors.



PHS 380.305-3  Responsibilities.

    (a) The program office which initiates the requirement is 
responsible for advising the contracting office as to the applicability 
of the MAC regulation to the proposed acquisition.
    (b) The Pharmacy Liaison Officer, PHS, is responsible for 
distributing to the principal official responsible for acquisition of 
the MAC determination or data concerning the acquisition cost of drugs. 
The MAC determination should be furnished within thirty days after 
publication as a final rule in the Federal Register. Acquisition cost 
data should be furnished within thirty days after the effective date.
    (c) The principal official responsible for acquisition shall 
establish procedures for disseminating MAC determinations and 
acquisition cost data and may initiate other actions necessary to ensure 
compliance with the requirements of this regulation.



PHS 380.305-4  Solicitation notification.

    (a) The contracting officer shall ensure that all requests for 
proposals and invitations for bids which are subject to the provisions 
of the MAC regulation contain a notice worded substantially as follows:

    This acquisition is subject to the Maximum Allowable Cost (MAC) 
regulation set forth in Part 19 to Subtitle A of Title 45 of the Code of 
Federal Regulations.

    (b) The contracting officer shall include the applicable MAC 
determination or acquisition cost data in the RFP or IFB.
    (c) The referenced solicitation notice, or a notice worded similarly 
to it, is required to be included in all applicable solicitations issued 
by the contractor or its subcontractors.



PHS 380.305-5  Contract requirements.

    (a) The contracting officer shall include a clause entitled 
``Maximum Allowable Cost for Drugs,'' reading substantially as the 
clause cited in PHS 352.280-3, in all contracts subject to the 
provisions of the MAC regulation.
    (b) The contracting officer shall incorporate in all contracts 
subject to the provisions of the MAC regulation the applicable MAC 
determination or acquisition cost data furnished in the solicitation.
    (c) The clause cited in PHS 352.280-3, or a clause worded 
substantially as that cluase, is required to be included in all 
applicable contracts awarded by the contractor or its subcontractors.



PHS 380.306  Acquisition of tax free and specially denatured alcohol.

    (a) All orders for tax free and specially denatured alcohol shall be 
placed with the HRSA Supply Service Center, Perry Point, MD. Orders 
shall be placed in accordance with the ordering instructions contained 
in the HRSA Medical Supply Catalog.



  Subpart PHS 380.4--Contracts Under the Indian Self-Determination Act



PHS 380.400  Scope of subpart.

    This subpart prescribes procedures for contracting by the Public 
Health Service (PHS) under the Indian Self-Determination Act (25 U.S.C. 
450f).



PHS 380.401  Applicability of regulations.

    Contracts with tribal organizations resulting from the submission of 
Indian Self-Determination Contract Proposals as authorized in Public Law 
93-638 shall be in accordance with 41 CFR Chapters 1 and 3, except as 
otherwise provided herein. If this subpart conflicts with any of the 
other provisions of 41 CFR Chapters 1 or 3, the provisions of this 
subpart govern.



PHS 380.402  Waivers.

    (a) The Secretary of Health and Human Services (HHS) waives Federal 
contract clauses that are normally contained in the General provisions 
of a contract to the extent that they are omitted from the General 
provisions prescribed for such contracts in this subpart.
    (b) The Secretary may waive for the purpose of a specific contract 
other provisions of Federal contracting laws

[[Page 219]]

or regulations as determined not appropriate in view of, or are 
inconsistent with, the provisions of the Indian Self-Determination and 
Education Assistance Act (25 U.S.C. 450 et seq.). Requests for such 
waivers shall be in accordance with 42 CFR 36.216.
    (c) Although it is PHS's policy to obtain competition whenever 
possible, any contract award to a tribal organization resulting from the 
submission of an Indian Self-Determination Contract Proposal will be 
effected without competition.
    (d) Proposed contracts under section 103 of the Indian Self-
Determination Act are exempted from the synopsis requirements of 41 CFR 
1-1.1003. Although subcontracts are subject under section 7(b) of that 
act to a preference to Indian organizations and to Indian-owned economic 
enterprises, opportunities to so subcontract may be publicized by 
contracting officers as provided for in 41 CFR 1-1.1003-4.



PHS 380.403  Negotiating authority.

    Contracts entered into pursuant to section 103 of the Indian Self-
Determination Act (25 U.S.C. 450g) will cite as the negotiating 
authority 41 U.S.C. 252(c)(15) and 25 U.S.C. 450g.



PHS 380.404  Definitions.

    The definitions prescribed in 42 CFR 36.204 are applicable to this 
supbart.



PHS 380.405  Types of contracts.

    (a) Cost-reimbursement contracts will be used for all contracts made 
pursuant to this subpart between PHS and an Indian tribe or tribal 
organization. In addition to other provisions as the Secretary may from 
time to time require, the cost-reimbursement contracts shall contain the 
terms set out in PHS 352.280-4(a).
    (b) Fixed-price contracts may be used in only these instances where 
costs can be precisely established. In addition to other provisions as 
the Secretary may from time to time require, the fixed-price contracts 
shall contain the terms set out in PHS 352.280-4(b).
    (c) Cost sharing contracts may be used where the tribe contributes 
to the cost of a program and may specify a percentage of cost or fixed 
amount to be funded by the Government.



PHS 380.406  Term of contract.

    (a) The term of contracts awarded under the Act shall not exceed one 
year except that contracts may be made for a longer term up to three 
years subject to the availability of appropriations under the following 
circumstances:
    (1) The services provided under the contract can reasonably be 
expected to be continuing in nature and, as a result, a longer contract 
term would be advantageous.
    (2) The Indian tribe or tribes to be served by the contract request 
that the term be more than one year. The tribal organizational will 
indicate the desired term of the contract in the Self-Determination 
Contract Proposal.
    (b) Contract made for a term of more than one year may be 
renegotiated annually to reflect factors which include, but need not be 
limited to, cost increases beyond the control of the tribal contractor. 
Proposed changes in the services provided under the contract which 
reflect changes in program emphasis may be considered during the annual 
renegotiation if the changes fall within the general scope of the 
contract.



PHS 380.407  Exemption from bonds.

    A tribal organization is not required to furnish performance and 
payment bonds before carrying out a contract under this subpart for the 
construction of public buildings or works as required by the Miller Act 
of August 24, 1935 (49 Stat. 793), as amended. However, the tribal 
organization shall require each of its subcontractors other than tribal 
organizations, to furnish both performance and payment bonds as follows:
    (a) A performance bond with a surety or sureties satisfactory to the 
approving official, and in an amount he/she deems adequate, for the 
protection of the United States.
    (b) A payment bond with a surety or sureties satisfactory to the 
approving official for the protection of all persons supplying labor and 
material in the prosecution of the work provided for in the contract. 
Whenever the total amount payable by the terms of the contract is not 
more than $1,000,000, the payment bond shall be one-half the total 
amount payable by the terms of the contract. Whenever the total

[[Page 220]]

amount payable by the terms of the contract is more than $1,000,000 but 
not more than $5,000,000, the payment bond shall be 40 percent of the 
total amount payable by the terms of the contract. Whenever the total 
amount payable by the terms of the contract is more than $5,000,000, the 
payment bond shall be $2,500,000.



PHS 380.408  Acquisition of construction and architect-engineering service contract.

    (a) This section sets forth procedures and requirements peculiar to 
construction and architect-engineering service contracts. The terms and 
conditions of these contracts when negotiated with an Indian tribe or 
tribal organization pursuant to the Act shall, to the extent applicable, 
be in accordance with the requirements set forth in 41 CFR Part 1-18 and 
Subpart 1-4.10. However, if there is a conflict between 41 CFR Part 1-18 
and Subpart 1-4.10, and any provision of the Act or 42 CFR Part 36, the 
Act or 42 CFR Part 36 shall govern. In addition these contracts shall 
include the special provisions identified in PHS 380.410.
    (b) Exceptions.
    (1) Subpart 1-18.10 of this title is not applicable.
    (2) The contract clauses required by Sec. 1-18.703-1 of this title 
shall be inserted in construction contracts with an Indian tribe or 
tribal organization which serves as a governmental instrumentality of an 
Indian tribe, but shall be prefaced by the provision contained in 
Sec. 1-18.702-3 of this title.
    (3) In all cases, the contracting officer shall obtain and insert 
the Wage Determination Decision issued by the Secretary of Labor in the 
contract prior to award of any contract for construction that falls 
within the purview of the Davis-Bacon Act. The Wage Determination 
Decision should be furnished sufficiently in advance of the contract 
award date to permit full consideration by the tribal organization and 
any prospective subcontractors.



PHS 380.409  Performance of personal services.

    Any contract made under this subpart may include provisions for the 
performance of personal services which would otherwise be performed by 
Federal employees. Such services include, but are not limited to, 
performing the following functions in connection with the contract and 
applicable rules and regulations:
    (a) Determining the eligibility of applicants for assistance, 
benefits, or services.
    (b) Determining the extent or amount of assistance, benefits, or 
services to be provided.
    (c) Providing such assistance, benefits, or services.



PHS 380.410  Special provisions of Indian Self-Determination contracts.

    Contracts entered into pursuant to Section 103 of the Indian Self-
Determination Act must incorporate special clauses which are consistent 
with those prescribed in Subpart I of Part 36 of 42 CFR on the following 
subjects:
    (a) Fair and equal treatment of Indian people.
    (b) Use of Indian business concerns.
    (c) Indian preference in training and employment.
    (d) Indemnity and insurance.
    (e) Reports to the Indian people.
    (f) Penalties.
    (g) Retrocession.
    (h) Assumption and reassumption of contract programs.



PHS 380.411  General provisions.

    General provisions are published in these regulations (see PHS 
352.280-4 for text of clauses) in order to respond to the expressed 
desire of the Indian people, to have published in one place, all of the 
terms and conditions applicable to contracts awarded under the Act. 
These general provisions incorporate the special clauses whose titles 
are listed in PHS 380.410, above, as well as applicable standard 
contract clauses.



        Subpart PHS 380.5--Acquisitions Under the Buy Indian Act



PHS 380.500  Scope of subpart.

    This subpart sets forth the policy on preferential acquisition from 
Indians under the negotiation authority of the Bay 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.

[[Page 221]]



PHS 380.501  Policy.

    (a) The Indian Health Service will utilize the negotiation authority 
of the Buy Indian Act to give preference to Indians whenever the use of 
that authority is authorized and is practicable. The Buy Indian Act was 
enacted as a proviso to Section 23 of the Act of June 25, 1910, Chapter 
431, Pub. L. 313, 61st Congress, 36 Stat. 861,and 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 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 were transferred to the Secretary of Health, Education, and 
Welfare, on July 1, 1955 by Pub. L. 568, 83rd Congress, 42 U.S.C. 2001 
et seq. 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 Pub. L. 94-437 and 
Pub. L. 96-537.



PHS 380.502  Definitions.



PHS 380.502-1  Indian.

    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 such 
determinations may take into account the determination of the tribe with 
which affiliation is claimed.



PHS 380.502-2  Indian firm.

    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 Pub. L. 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 
PHS 380.503(a)).



PHS 380.502-3  Product of Indian industry.

    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.



PHS 380.502-4  Buy Indian contract.

    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)(15) and 25 U.S.C. 47 between an Indian firm and a 
contracting officer representing the Indian Health Service.



PHS 380.502-5  Buy Indian restricted advertising.

    Buy Indian restricted advertising is a special method of negotiated 
acquisition conducted in the same manner as a formally advertised 
acquisition, except that competition and award are restricted to Indian 
firms (see FAR 19.101). Thus, a Buy Indian acquisition may be considered 
an acquisition set-aside for Indian firms in the manner that some 
acquisitions are set-aside for small business concerns (see FAR 19.101). 
Set-aside acquisitions are, technically, negotiated acquisitions but 
should be conducted as if they were formally advertised acquisitions in 
instances where the formal advertising method would be used if the set-
aside was not in effect.

[[Page 222]]



PHS 380.503  Requirements.

    (a) Indian ownership. The degree of ownership that is called for by 
PHS 380.502-2 shall be 100 percent during the period covered by a Buy 
Indian contract unless a deviation from that 100 percent requirement is 
approved on an individual basis by the cognizant Area or Program Office 
Director of the Indian Health Service. Such a deviation, which may be to 
not less than 51 percent, must be accompanied by an appropriate 
justification for the deviation.
    (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 pubic works, performance 
and payment bonds are required by the Miller Act (40 U.S.C. 270a) and 
Part 28 of the Federal Acquisition Regulation (48 CFR Ch. 1). 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 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 (Pub. L. 93-638), which requires that 
preference be given to Indians in employment, training, and 
subcontracting. Subpart 370.2 and the contract clauses in 352.270-2 and 
352.270-3 represent the Department's implementation of section 7(b). 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-5) 
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 members 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.



PHS 380.504  Competition.

    (a) Contracts to be awarded under the Buy Indian Act shall be 
subject to competition among Indians or Indian concerns to the maximum 
extent that competition is determined by the contracting officer to be 
practicable, pursuant to FAR 14.101 and FAR 15.105. When competition is 
determined not to be practicable, a Justification for Noncompetitive 
Acquisition shall be prepared in accordance with 315.7105 and 
subsequently retained in the contract file.
    (b) Notwithstanding the provisions of Subpart 315.71, a request for 
approval of noncompetitive acquisitions to be negotiated under the Buy 
Indian Act may, if $25,000 or less, be approved by

[[Page 223]]

the chief of the contracting office,or, if over $25,000, by the 
cognizant Area or Program Office Director. Approval shall be in the form 
of a Justification for Noncompetitive Acquisition.
    (c) Solicitations must be synopsized and publicized in the Commerce 
Business Daily (see FAR 5.2 and Subpart 305.2) 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 should 
state that the acquisition is restricted to Indian firms under the Buy 
Indian Act.



PHS 380.505  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 such a contract and that the 
project or function is likely to be properly completed or maintained 
under that contract.
    (b) The determination called for by paragraph (a), 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, 309.104-1 of this Chapter and PHS 380.502-2.

[[Page 225]]



                  CHAPTER 4--DEPARTMENT OF AGRICULTURE




                           (Parts 400 to 499)

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

                          SUBCHAPTER A--GENERAL
Part                                                                Page
401             Agriculture Acquisition Regulation System...         227
402             Definitions of Words and Terms..............         231
403             Improper Business Practices and Personal 
                    Conflicts of Interest...................         232
404             Administrative Matters......................         234
           SUBCHAPTER B--COMPETITION AND ACQUISITION PLANNING
405             Publicizing Contract Actions................         236
406             Competition Requirements....................         236
407             Acquisition Planning........................         237
408             Required Sources of Supplies and Services...         238
409             Contractor Qualifications...................         240
410

[Reserved]

411             Describing Agency Needs.....................         242
412             Acquisition of Commercial Items.............         243
          SUBCHAPTER C--CONTRACTING METHODS AND CONTRACT TYPES
413             Simplified Acquisition Procedures...........         244
414             Sealed Bidding..............................         244
415             Contracting by Negotiation..................         245
416             Types of Contracts..........................         247
417             Special Contracting Methods.................         249
418

[Reserved]

                  SUBCHAPTER D--SOCIOECONOMIC PROGRAMS
419             Small Business Programs.....................         250
420

[Reserved]

421

[Reserved]

422             Application of Labor Laws to Government 
                    Acquisitions............................         251
423             Environment, Conservation, Occupational 
                    Safety, and Drug-Free Workplace.........         253
424             Protection of Privacy and Freedom of 
                    Information.............................         256

[[Page 226]]

425             Foreign Acquisition.........................         256
426

[Reserved]

             SUBCHAPTER E--GENERAL CONTRACTING REQUIREMENTS
427             Patents, Data, and Copyrights...............         259
428             Bonds and Insurance.........................         259
429

[Reserved]

430             Cost Accounting Standards Administration....         260
431             Contract Cost Principles and Procedures.....         261
432             Contract Financing..........................         261
433             Protests, Disputes and Appeals..............         265
             SUBCHAPTER F--SPECIAL CATEGORIES OF CONTRACTING
434             Major System Acquisition....................         267
435             Research and Development Contracting........         268
436             Construction and Architect-Engineer 
                    Contracts...............................         268
437             Service Contracting.........................         271
438

[Reserved]

439

[Reserved]

440

[Reserved]

441             Acquisition of Utility Services.............         272
                    SUBCHAPTER G--CONTRACT MANAGEMENT
442             Contract Administration.....................         273
443

[Reserved]

444

[Reserved]

445             Government Property.........................         273
446             Quality Assurance...........................         274
447             Transportation..............................         274
448

[Reserved]

449             Termination of Contracts....................         274
450             Extraordinary Contractual Actions...........         275
451

[Reserved]

                     SUBCHAPTER H--CLAUSES AND FORMS
452             Solicitation Provisions and Contract Clauses         277
453             Forms.......................................         287

[[Page 227]]



                          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.

                      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:
    (1) Daily issues of the Federal Register,
    (2) Cumulative form in the CFR, and

[[Page 228]]

    (3) Loose-leaf form for distribution within USDA.
    (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. OFPP Policy Letter 83-2 requires rulemaking for 
substantive acquisition rules but allows discretion in the matter for 
other than significant issues meeting the stated criteria. The AGAR has 
been promulgated and may be revised from time to time in accordance with 
the rulemaking procedures of the Administrative Procedure Act and OFPP 
Policy Letter 83-2.



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
415.4......................................................    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
------------------------------------------------------------------------



                      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 with interested contracting activities.



              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.
    (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.

[[Page 229]]

4F [Reserved].
4G Forest Service.
4H [Reserved].
4I Natural Resources Conservation Service.
4J [Reserved].
4K Food and Consumer Service.
4L Animal and Plant Health Inspection Service.
4M [Reserved].
4N Office of Operations.
4O [Reserved].
4P [Reserved].
4R Office of Inspector General.
4S [Reserved].



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.



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;

[[Page 230]]

    (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.
    (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.

[[Page 231]]



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.



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

[[Page 232]]

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, Procurement and Property Management, Policy 
Analysis and Coordination Center, has been designated as the USDA SPE.



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  Disclosure, protection, and marking of proprietary and source 
          selection information.
403.104-11  Processing 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

403.409  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.



                        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  Disclosure, protection, and marking of proprietary and source selection information.

    For contracts and contract modifications in excess of $100,000, the 
contracting officer shall assure that the information listed in FAR 
3.104-5(d)(2) is maintained in the contract file.



403.104-11  Processing violations or possible violations.

    (a) 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.
    (b) Heads of contracting activities (HCA's) or their designees who 
receive information concerning any violation or possible violation of 
the Act shall

[[Page 233]]

take action in accordance with FAR 3.104-11(b)(1), (2), (3), or (4).



      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



403.409  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 3.409(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.



            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. 51-54) to the Office of 
Inspector General in accordance with procedures in Departmental 
Regulations (1700 series).



  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.

[[Page 234]]



 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 404.4--Safeguarding Classified Information Within Industry

Sec.
404.403  Responsibilities of contracting officers.

                    Subpart 404.6--Contract Reporting

404.601  Record requirements.
404.602  Federal Procurement Data System.

                      Subpart 404.8--Contract Files

404.870  Document numbering system.
404.870-1  Purchase order/delivery order numbering system.
404.870-2  Contract numbering system.

                   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 404.4--Safeguarding Classified Information Within Industry



404.403  Responsibilities of contracting officers.

    When a proposed solicitation is likely to require access to 
information classified by USDA, the contracting officer shall consult 
with the Director of Human Resources Management within the Policy 
Analysis and Coordination Center of the Office of Assistant Secretary 
for Administration, regarding the procedures that must be followed.



                    Subpart 404.6--Contract Reporting



404.601  Record requirements.

    The Senior Procurement Executive (SPE) manages an automated 
procurement reporting system for USDA. This system provides the Federal 
Procurement Data System with all required contracting information.



404.602  Federal Procurement Data System.

    Contracting activities shall report contract actions into the USDA 
Procurement Reporting System in accordance with the instructions issued 
or distributed by the SPE.



                      Subpart 404.8--Contract Files



404.870  Document numbering system.



404.870-1  Purchase order/delivery order numbering system.

    USDA purchasing activities shall number their purchase/delivery 
orders in accordance with NFC Procedures Manual, ``Purchase Orders,'' 
Title II, Section 5.1.



404.870-2  Contract numbering system.

    Contracting offices shall assign an 8 to 12-digit number to all 
contracts. Contract numbers will be divided into four data elements and 
formatted as follows:

(1)                                    (2)       (3)                 (4)
------------------------------------------------------------------------
                   Transaction Ordering Fiscal Control                  
Code                                Office      Year              Number
------------------------------------------------------------------------
XX                                    XXXX         X          X to XXXXX
------------------------------------------------------------------------
                                                                        

    (a) Transaction code. This two-position code identifies the contract 
as being one of the following types:

    (1) Code 50--construction contract;
    (2) Code 51--[Reserved]
    (3) Code 52--tree planting/thinning contract;
    (4) Code 53--service contract;
    (5) Code 54--supply contract;
    (6) Code 55--aircraft rental (for fire-fighting purposes only) 
contract;
    (7) Code 56--personal equipment rental (rental of vehicular 
equipment for firefighting purposes only) contract;

[[Page 235]]

    (8) Code 57--leasehold interest in real property contract.

    (b) Ordering office. This four-position code corresponds to the last 
four characters of the contracting office's GSA assigned FEDSTRIP 
requisitioner number.
    (c) Fiscal year. This one-position code corresponds to the last 
digit of the fiscal year in which the contract becomes effective.
    (d) Control number. This up-to-five position code (from one to five 
characters may be used) will be assigned by the contracting office. 
While contracts will generally be numbered consecutively (1 through 
99999), contracting offices may assign codes in any manner of their 
choosing. Codes may not be repeated, however, unless one of the 
preceding data elements (transaction code, ordering office, or fiscal 
year) changes. Alpha characters as well as numerals may be used in any 
one or more of the five positions.



                   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 236]]





           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(a).



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 USDA Security Officer, Policy Analysis and Coordination 
Center--Human Resources Management. Departmental Manual and Regulation 
(3400 series) contain guidance on classified information.



                   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.

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

[[Page 237]]


    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, Procurement and Property 
Management, Policy Analysis and Coordination Center, has been designated 
as the Competition Advocate for USDA.
    (b) Each HCA shall designate a competition advocate for the 
contracting activity.



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--Contractor Versus Government Performance

407.302  General.

            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 implement an advance acquisition planning system in 
accordance with procedures in Departmental Directives (5000 series).



         Subpart 407.3--Contractor Versus Government Performance



407.302  General.

    The requirements of FAR subpart 7.3 and OMB Circular A-76 are 
implemented by Departmental Directives (2100 series).



            Subpart 407.5--Inherently Governmental Functions



407.503  Policy.

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

[[Page 238]]

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 written determination in accordance with 
FAR 7.503(e).
    (c) Such disagreements shall be resolved prior to issuance of the 
solicitation.



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 Handicapped

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 Handicapped



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 head of the contracting activity (HCA), the 
head of a USDA corporation (as described in 31 U.S.C. 9101), or the head 
of a USDA staff office.



408.705  Procedures.

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

[[Page 239]]

    (3) Provide for the JWOD Advocate'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.



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 
Advocate 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 
Advocate 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 Advocate 
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 Advocate 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 Advocate 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 Advocate 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 Advocate 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 Advocate 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.



                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 oil and other fluid

[[Page 240]]

changes or replenishment, the contracting officer shall include in the 
contract (1) a requirement for fluids containing the maximum available 
amounts of recovered materials; and (2) a preference for either 
retreaded tires meeting the Federal retread specifications or retreading 
services for the tires on the vehicle.



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.
409.470  Appeals.

   Subpart 409.5--Organizational and Consultant Conflicts of Interest

409.503  Waiver.

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

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



         Subpart 409.4--Debarment, Suspension and Ineligibility



409.403  Definitions.

    Debarring official. The Senior Procurement Executive (SPE) is 
designated as the debarring official (Department Debarring Officer) 
pursuant to the Secretary's delegations of authority in 7 CFR 2.24. 
However, 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).



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.



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

[[Page 241]]

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).



409.470  Appeals.

    A debarred or suspended contractor may appeal the debarring 
official's decision by mailing or otherwise furnishing a written notice 
within 90 days from the date of the decision to the U.S. Department of 
Agriculture Board of Contract Appeals, Washington, DC 20250. A copy of 
the notice of appeal shall be furnished to the debarring officer from 
whose decision the appeal is taken. Appeals under subpart 409.4 shall be 
governed by the rules and procedures of the U.S. Department of 
Agriculture Board of Contract Appeals set forth in 7 CFR part 24.



   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;
    (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--[RESERVED]




[[Page 242]]



PART 411--DESCRIBING AGENCY NEEDS--Table of Contents




     Subpart 411.1--Selecting and Developing Requirements Documents

Sec.
411.103  Market acceptance.
411.105  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



411.103  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.



411.105  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 personnel fail to identify 
themselves as non-Government officials.



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 452.211-1, 
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 452.211-2, Equal 
Products Offered, in solicitations, other than those for construction, 
where the provision at 452.211-1 is included.
    (c) Contracting officers shall insert the clause at 452.211-3, 
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 452.211-4, 
Attachment to Statement of Work/Specifications, when there are 
attachments to the description (statement of work) or specifications.



       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

[[Page 243]]

 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 452.211-5, 
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 452.211-6, 
Effective Period of the Contract, when it is necessary to specify the 
effective period of the contract.



                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).



  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 244]]





          SUBCHAPTER C--CONTRACTING METHODS AND CONTRACT TYPES





PART 413--SIMPLIFIED ACQUISITION PROCEDURES--Table of Contents




                         Subpart 413.1--General

Sec.
413.103  Policy.

                       Subpart 413.4--Imprest Fund

413.401  General.

                     Subpart 413.5--Purchase Orders

413.505  Purchase order and related forms.

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

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



                         Subpart 413.1--General



413.103  Policy.

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



                       Subpart 413.4--Imprest Fund



413.401  General.

    Departmental Regulation 2000 series sets policies and guidelines for 
the use of imprest funds within USDA. Departmental Regulation 5000 
series establishes policies and procedures for the use of the Third 
Party Draft System in USDA.



                     Subpart 413.5--Purchase Orders



413.505  Purchase order and related forms.

    (a) Form AD-838, Purchase Order, is prescribed for use by USDA in 
lieu of Optional Forms 347 and 348.
    (b) The Standard Form 44 (and the previously prescribed USDA Form 
AD-744) is not authorized for use within USDA.



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).

[[Page 245]]



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).



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 USDA Security Officer, Policy Analysis and 
Coordination Center--Human Resources Management.



PART 415--CONTRACTING BY NEGOTIATION--Table of Contents




           Subpart 415.1--General Requirements for Negotiation

Sec.
415.103  Converting from sealed bidding to negotiation procedures.

   Subpart 415.4--Solicitation and Receipt of Proposals and Quotations

415.406  Preparing requests for proposals (RFP's) and requests for 
          quotations (RFQ's).
415.406-1  Uniform contract format.
415.407  Solicitation provisions.
415.408  Issuing solicitations.
415.411  Receipt of proposals and quotations.
415.413  Disclosure and use of information before award.
415.413-2  Alternate II.

                  Subpart 415.5--Unsolicited Proposals

415.504  Advance guidance.
415.506  Agency procedures.

                     Subpart 415.6--Source Selection

415.607  Disclosure of mistakes before award.
415.608  Proposal evaluation.
415.612  Formal source selection.

                          Subpart 415.9--Profit

415.902  Policy.

 Subpart 415.10--Preaward, Award, and Postaward Notifications, Protests 
                              and Mistakes

415.1070  Post-award conference.

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

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



           Subpart 415.1--General Requirements for Negotiation



415.103  Converting from sealed bidding to negotiation procedures.

    An acquisition official at a level above the contracting officer is 
authorized to make the determination to permit the use of negotiation to 
complete an acquisition following the cancellation of an invitation for 
bids.



   Subpart 415.4--Solicitation and Receipt of Proposals and Quotations



415.406  Preparing requests for proposals (RFP's) and requests for quotations (RFQ's).



415.406-1  Uniform contract format.

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



415.407  Solicitation provisions.

    (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

[[Page 246]]

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.



415.408  Issuing solicitations.

    Departmental Regulation and Manual (Series 3400), establishes policy 
and procedures regarding classification, declassification and 
safeguarding of classified information.



415.411  Receipt of proposals and quotations.

    Departmental Regulation and Manual (Series 3400), contains guidance 
on classification, declassification and safeguarding of classified 
information.



415.413  Disclosure and use of information before award.

    Contracting officers shall use the Alternate II procedures in FAR 
15.413-2 and subsection 415.413-2 when releasing proposals outside the 
Government for evaluation purposes.



415.413-2  Alternate II.

    (a) The head of the contracting activity (HCA) is authorized to 
approve the release of proposals outside the Government for evaluation 
purposes. Each such decision shall be supported by a written 
justification that shows in sufficient detail the special needs or 
circumstances requiring the services of individuals outside the 
Government.
    (b) During the preaward period, only the contracting officer, the 
chief of the contracting office, or others specifically authorized by 
either of them may communicate technical or other information to, or 
conduct discussions with, offerors. Information shall not be furnished 
to an offeror if, alone or together with other information, it may 
afford the offeror an advantage over other offerors. However, general 
information that is not prejudicial to other offerors may be furnished.
    (c) Agency personnel and non-Government evaluators having authorized 
access to information contained in proposals shall disclose neither the 
number of offerors nor their identity to the public or to anyone in 
Government except as authorized in accordance with FAR 3.104 (See also 
FAR 5.403).
    (d) 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 me 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 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)

[[Page 247]]

                           (End of provision)

    (e) The release of a proposal outside the Government for evaluation 
does not constitute the release of information for purposes of the 
Freedom of Information Act (5 U.S.C. 552).
    (f) The contracting officer shall attach a cover page bearing the 
GOVERNMENT NOTICE FOR HANDLING PROPOSALS, as set forth in FAR 15.413-
2(e), to each proposal upon receipt. The last sentence of the notice 
shall cite 48 CFR 415.413 as the agency implementing regulation.



                  Subpart 415.5--Unsolicited Proposals



415.504  Advance guidance.

    HCA's are responsible for establishing procedures to ensure 
compliance with the requirements of FAR 15.504.



415.506  Agency procedures.

    HCA's are responsible for establishing the procedures for control of 
unsolicited proposals required by FAR 15.506(a) and for identifying the 
contact points as required by FAR 15.506(b).



                     Subpart 415.6--Source Selection



415.607  Disclosure of mistakes before award.

    The HCA with the concurrence of the Office of the General Counsel is 
authorized to make the determination permitting proposal correction as 
required by FAR 15.607(c)(3).



415.608  Proposal evaluation.

    An acquisition official above the level of the contracting officer 
is authorized to make the determination to reject all proposals under 
the circumstances listed in FAR 15.608(b).



415.612  Formal source selection.

    The HCA shall determine when a formal source selection process will 
be used and establish procedures for implementing the requirements of 
FAR 15.612.



                          Subpart 415.9--Profit



415.902  Policy.

    (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 15.905-1 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 415.10--Preaward, Award, and Postaward Notifications, Protests 
                              and Mistakes



415.1070  Post-award Conference.

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



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

416.404  Cost-reimbursement incentive contracts.
416.404-2  Cost-plus-award-fee contracts.
416.405  Contract clauses.
416.470  Solicitation provision.

[[Page 248]]

              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



416.404  Cost-reimbursement incentive contracts.



416.404-2  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.



416.405  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.



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.



              Subpart 416.5--Indefinite-Delivery Contracts



416.505  Ordering.

    (a) The Chief, Procurement Policy Division, Procurement and Property 
Management, Policy Analysis and Coordination Center, has been designated 
as the Departmental Task Order Ombudsman.
    (b) The Departmental Task Order Ombudsman shall designate a task 
order ombudsman for each contracting activity. 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.



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.

[[Page 249]]

    (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 250]]

--Table of Contents






                  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.

    Subpart 419.6--Certificates of Competency and Determinations of 
                               Eligibility

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



419.201  General policy.

    It is the policy of USDA to provide a fair portion of its 
contracting and subcontracting opportunities to small, disadvantaged, 
minority, and women-owned businesses.



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 and disadvantaged business procurement 
preference program to include minority and women-owned business.



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) Review each proposed acquisition expected to exceed the 
simplified acquisition threshold prior to its solicitation. The 
coordinator shall:
    (1) Recommend section 8(a) action and identify potential 
contractors, or
    (2) Identify available minority and women-owned businesses to be 
solicited by competitive procedures. Coordinators shall document the 
contract file with recommendations made and actions taken.
    (b) Participate in goal-setting procedures and planning activities 
and establish aggressive minority and women-owned business goals based 
on the annual review of advance acquisition plans.
    (c) Participate in the review of those contracts which require the 
successful offeror to submit written plans for the utilization of small 
and small disadvantaged businesses as subcontractors.
    (d) Ensure that purchases exceeding $2,500 and not exceeding the 
simplified acquisition threshold are reserved exclusively for small 
businesses, including minority and women-owned businesses. 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) Maintain comprehensive source listings of small businesses.
    (f) Upon written request, provide small, minority and women-owned 
businesses the bidders mailing lists of individuals receiving 
solicitations which will contain the subcontracting clause entitled 
``Utilization of Small Business Concerns and Small Disadvantaged 
Business Concerns.'' These lists may be limited to those supplies or 
services of major interest to the requesting firms.

[[Page 251]]

    (g) Develop a program of contacts with local, small, minority, and 
women-owned 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 meet with program managers to discuss requirements 
of the small business preference program, explore the feasibility of 
breaking large complex requirements into smaller lots suitable for 
participation by small firms, and encourage program managers to meet 
with these firms so that their capabilities can be demonstrated.
    (i) Establish internal operating procedures which implement the 
requirements of the regulations as set forth in this part 419. Compile 
data and prepare all reports pertaining to the small, minority and 
women-owned business activities. Ensure that these reports are accurate, 
complete and up-to-date.
    (j) Assist and counsel small business firms and especially those 
found to be nonresponsive or nonresponsible to help qualify them for 
future awards.
    (k) Review proposed large contract requirements to determine the 
potential for breaking out components suitable for purchase from small 
business firms.
    (l) Ensure 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 and 
small disadvantaged business subcontracting plans.



419.201-73  Reports.

    (a) The Director, OSDBU, shall be responsible for submitting reports 
concerning USDA's progress and achievements in the procurement 
preference program.
    (b) Subcontracting data for an agency shall be collected by the 
small business coordinators and submitted to OSDBU by April 10 and 
November 20 of each year.



              Subpart 419.5--Set-Asides for Small Business



419.508  Solicitation provisions.

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



    Subpart 419.6--Certificates of Competency and Determinations of 
                               Eligibility



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 file the formal appeal with the Small 
Business Administration's Central Office as provided by FAR 19.602-3(c).



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.

   Subpart 422.4--Labor Standards for Contracts Involving Construction

422.404   Davis-Bacon Act wage determinations.
422.404-6   Modifications of wage determinations.

[[Page 252]]

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   Procedures.
422.608-4   Award pending final determination.

               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 and Vietnam Era Veterans

422.1303  Waivers.
422.1306  Complaint procedures.

              Subpart 422.14--Employment of the Handicapped

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(c). 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.



422.608  Procedures.



422.608-4  Award pending final determination.

    The HCA is delegated authority to approve the contracting officer's 
certification for award required by FAR 22.608-4.

[[Page 253]]



               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 Director, Office of Federal Contract Compliance Programs 
(OFCCP), as appropriate.



        Subpart 422.13--Special Disabled and Vietnam Era Veterans



422.1303  Waivers.

    (a) The Assistant Secretary for Administration is authorized to make 
the waiver determinations under FAR 22.1303(a) and FAR 22.1303(b) with 
concurrence of the Director, OFCCP.
    (b) The contracting office shall submit requests for waivers through 
the HCA to the SPE for determination by the Assistant Secretary for 
Administration.



422.1306  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 (DoL) as prescribed in FAR 22.1306.



              Subpart 422.14--Employment of the Handicapped



422.1403  Waivers.

    (a) The Assistant Secretary for Administration is authorized to make 
the waiver determinations under FAR 22.1403(a) and (b) with concurrence 
of the Director, OFCCP.
    (b) The contracting officer shall submit requests for waivers 
through the HCA to the SPE for determination by the Assistant Secretary 
for Administration.



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, CONSERVATION, OCCUPATIONAL SAFETY, AND DRUG-FREE WORKPLACE--Table of Contents




        Subpart 423.1--Pollution Control and Clean Air and Water

Sec.
423.101  Applicability.
423.103  Policy.
423.104  Exemptions.
423.106  Delaying award.
423.107  Compliance responsibilities.

                   Subpart 423.2--Energy Conservation

423.203  Policy.

                Subpart 423.4--Use of Recovered Materials

423.400  Scope of subpart.
423.402  Definitions.
423.404  Procedures.
423.404-70  Acquisition, Recycling, and Waste Prevention Program 
          (AR&WPP).

                   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.

[[Page 254]]

  Subpart 423.7--Contracting for Environmentally Preferable and Energy-
                     Efficient Products and Services

423.704  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 423.1--Pollution Control and Clean Air and Water



423.101  Applicability.

    In addition to the requirement in FAR 23.101, this subpart applies 
to indefinite-delivery contracts, other than those for commercial items, 
when the contracting officer estimates that the contract will exceed 
$100.000.



423.103  Policy.

    The head of the contracting activity (HCA) shall establish a system 
of instructions to make available to each contracting officer the EPA 
List of Violating Facilities and to ensure the contracting officer 
reviews the list prior to each proposed award.



423.104  Exemptions.

    (a) The Assistant Secretary for Administration is authorized to 
grant an exemption described in FAR 23.104.
    (b) The Senior Procurement Executive (SPE) is authorized to consult 
with the EPA Administrator regarding a proposed class exemption.



423.106  Delaying award.

    Prior to notifying EPA, the contracting officer shall advise the SPE 
of the need to award before the requested time period expires.



423.107  Compliance responsibilities.

    The HCA is authorized to notify the Administrator of EPA of known or 
suspected noncompliance with clean air or water standards in facilities 
used in performing nonexempt contracts. A copy of the notification is to 
be provided to the SPE.



                   Subpart 423.2--Energy Conservation



423.203  Policy.

    In the acquisition of products and services, USDA will give 
preference to those that are more energy-efficient.



                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 recycling and 
waste prevention programs in accordance with Executive Order 12873 and 
42 U.S.C. 6962.



423.402  Definitions.

    Mission areas are USDA organizational elements headed by an 
Undersecretary or an Assistant Secretary.
    USDA Acquisition, Recycling, and Waste Prevention Program, issued by 
the USDA Environmental Executive, provides implementing guidance for 
Departmental affirmative procurement, recycling, and waste reduction.
    The USDA Environmental Executive is the Deputy Assistant Secretary 
for Administration.



423.404  Procedures.

    (a) The dollar thresholds described in FAR 23.404(a) apply to USDA 
as a whole.
    (b) EPA designated items. The officials identified as Acquisition, 
Recycling, and Waste Prevention Program (AR&WPP) Coordinators are 
authorized to approve determinations to buy EPA designated items which 
do not meet EPA or USDA minimum recovered material content standards.
    (c) Agency designated items. The USDA Environmental Executive may, 
without further publication in this chapter, designate items or classes 
of items containing recovered material to be acquired under the 
procedures in FAR 23.4 and this subpart.

[[Page 255]]



423.404-70  Acquisition, Recycling, and Waste Prevention Program (AR&WPP).

    (a) Applicability. The AR&WPP applies to all USDA organizations; 
i.e., USDA mission areas, USDA corporations (as described in 31 U.S.C. 
9101), and USDA staff offices not included within a mission area.
    (b) Authority. The AR&WPP has been established to comply with the 
requirements of Executive Order 12873 to coordinate all environmental 
programs in the areas of procurement and acquisition, standards and 
specification review, facilities management, waste prevention and 
recycling, and logistics.
    (c) Responsibilities. (1) Each USDA organization will identify one 
or more AR&WPP Coordinators in writing to represent the mission area, 
serve on the Council of Coordinators, and work in conjunction with the 
USDA Environmental Executive.
    (2) Each USDA organization periodically will conduct an audit 
(survey or inventory) of the waste stream generated by the organization. 
The goals of the audit are:
    (i) To identify and measure the elements of waste generated in its 
operations;
    (ii) To identify processes, equipment, techniques, or materials 
which generate waste in energy or materials;
    (iii) To identify actions which can be taken to reduce and to 
recycle or recover the wastes generated; and
    (iv) To assign time frames to accomplish those actions.
    (3) Each USDA organization will implement an avoidance or recovery 
or recycling program based on the results of the waste stream audit.
    (4) Each USDA organization will implement a plan to install on-going 
waste prevention techniques.
    (5) Each USDA organization will ensure that responsibility for 
preparation, implementation, and monitoring of its affirmative 
procurement program is shared between program personnel and procurement 
personnel.
    (6) Each USDA organization will establish measurable goals by which 
the effectiveness of its participation in AR&WPP can be assessed on an 
annual basis.
    (7) Each USDA organization will sponsor annual awards to recognize 
the most innovative environmental program of the year.
    (d) Acquisition and administration. (1) Each USDA organization will 
annually review its product descriptions to enhance the use of recovered 
materials and environmentally preferable products and services by 
eliminating from the product description:
    (i) Any exclusion of recovered materials, and
    (ii) Any requirement that items be manufactured from virgin 
materials.
    (2) Each USDA organization will create a promotion program to 
internally and externally promote its desire to buy recycled products.
    (3) Each USDA organization will implement the USDA electronic 
acquisition system to reduce waste by eliminating unnecessary paper 
transactions and to foster accurate data collection and reporting of 
acquisitions.
    (4) Each USDA organization will establish an affirmative procurement 
program specifically for the needs and requirements of its own 
organization, to maximize environmental benefits, consistent with price, 
performance, and availability considerations.
    (5) Each USDA organization will ensure that the on-going inspection 
and production surveillance systems in place will monitor the production 
or the testing of goods and services to verify the recovered material 
contents reported.
    (6) Each USDA organization will include
    (i) Requirements in contracts for contractor operation of 
Government-owned or leased facilities to provide for waste prevention 
activities and the recycling of materials and
    (ii) Environmental and recycling factors in the selection process 
for the acquisition and management of real property.



                   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

[[Page 256]]

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 and Energy-
                     Efficient Products and Services



423.704  Policy.

    In its acquisitions, USDA will give preference to environmentally 
preferable and energy-efficient products and services.



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

424.202  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 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



424.202  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 or awarding contracts that will involve the design, 
development, or operation of a system of records on individuals to 
accomplish agency functions.



PART 425--FOREIGN ACQUISITION--Table of Contents




                Subpart 425.1--Buy American Act--Supplies

Sec.
425.102  Policy.
425.105  Evaluating offers.
425.108  Expected articles, materials, and supplies.

         Subpart 425.2--Buy American Act--Construction Materials

425.202  Policy.
425.203  Evaluating offers.
425.204  Violations.

               Subpart 425.3--Balance of Payments Program

425.302  Policy.
425.304  Excess and near-excess foreign currencies.

                     Subpart 425.4--Trade Agreements

425.402  Policy.

[[Page 257]]

          Subpart 425.9--Additional Foreign Acquisition Clauses

425.901  Omission of audit clause.

   Subpart 425.10--Implementation of Sanctions Against Countries That 
 Discriminate Against United States Products or Services in Government 
                               Procurement

425.1002  Trade sanctions.

    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



425.102  Policy.

    The Senior Procurement Executive (SPE) shall make the determination 
prescribed in FAR 25.102(a)(3).



425.105  Evaluating offers.

    The SPE shall make the determinations prescribed in FAR 25.105. 
Requests for SPE approval shall be submitted by the HCA, in writing, and 
shall provide a detailed justification supporting why the proposed award 
is in the best interest of the Government.



425.108  Excepted articles, materials, and supplies.

    (a) Copies of determinations of nonavailability in accordance with 
FAR 25.102(a)(4) or 25.202(a)(3), for articles, material or supplies not 
listed in FAR 25.108, shall be submitted to the SPE for submission to 
the FAR Council.
    (b) Information required by FAR 25.108(c) shall be submitted to the 
SPE for submission to the FAR Council.



         Subpart 425.2--Buy American Act--Construction Materials



425.202  Policy.

    The SPE shall make the determination prescribed in FAR 25.202(a)(2).



425.203  Evaluating offers.

    (a) The SPE may determine that the use of a particular domestic 
construction material would be impracticable or would unreasonably 
increase the cost of the contract.
    (b) If a contracting officer proposes that the use of a particular 
domestic construction material should be waived for a contract, the 
contracting officer shall submit the proposed award and the information 
prescribed in FAR 25.203(b) through the HCA to the SPE for approval or 
disapproval.



425.204  Violations.

    Contracting officers shall, in accordance with the debarment 
procedures prescribed in 409.4, refer all violations of FAR clause 
52.225-5, Buy American Act--Construction Material, to the Department 
Debarring Officer for possible debarment action.



               Subpart 425.3--Balance of Payments Program



425.302  Policy.

    The HCA shall make the determinations prescribed in FAR 25.302(b)(2) 
and (3) and may authorize differentials greater than 50 percent as 
prescribed in FAR 25.302(c).



425.304  Excess and near-excess foreign currencies.

    HCA's shall make the determinations as to the feasibility of using 
excess or near-excess currency.



                     Subpart 425.4--Trade Agreements



425.402  Policy.

    Whenever the U.S. Trade Representative publishes a redetermination 
of the dollar threshold at which the Trade Agreements Act applies, that 
dollar threshold will be published in a Departmental Notice, 5025 
series.



          Subpart 425.9--Additional Foreign Acquisition Clauses



425.901  Omission of audit clause.

    The SPE shall make the determination under FAR 25.901(c)(1).

[[Page 258]]



   Subpart 425.10--Implementation of Sanctions Against Countries That 
 Discriminate Against United States Products or Services in Government 
                               Procurement



425.1002  Trade sanctions.

    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 25.1002(c).



PART 426--[RESERVED]




[[Page 259]]

--Table of Contents






             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

Sec.
428.101   Bid guarantees.
428.101-1   Policy on use.
428.106   Administration.
428.106-6  Furnishing information.

                         Subpart 428.2--Sureties

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



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



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.



                        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

[[Page 260]]

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 261]]



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.

          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

432.905  Invoice payments.
432.906  Contract financing payments.

               Subpart 432.10--Performance-Based Payments

432.1007  Administration and payment of performance-based payments.

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

    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

[[Page 262]]

contract to be entered under the simplified acquisition procedures. 
Class approvals may not be made.
    (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.

[[Page 263]]



          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 452.232-1, 
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.



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 264]]



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 
Board of Contract Appeals is the responsibility of the contracting 
officer.



                     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 265]]



                   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



432.905   Invoice payments.

    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.



432.906   Contract financing payments.

    The HCA may prescribe, on a case-by-case basis, a shorter period for 
financing payments.



               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  Protests to GAO.

                   Subpart 433.2--Disputes and Appeals

433.203  Applicability.
433.203-70  Agriculture Board of Contract Appeals.
433.209  Suspected fraudulent claims.

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

    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 General 
Accounting 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).



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 General Accounting Office in 
accordance with 4 CFR part 21. Neither the filing of a protest with USDA 
nor the filing of a protest with the General Accounting Office affects 
your right to file an action

[[Page 266]]

in a district court of the United States or the United States Court of 
Federal Claims.



433.104  Protests to GAO.

    The contracting activity shall furnish a copy of all reports 
submitted to the GAO, including all relevant documents, to the SPE 
simultaneously with their submission to the GAO.



                   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  Agriculture Board of Contract Appeals.

    The organization, jurisdiction, and functions of the Agriculture 
Board of Contract Appeals, together with its Rules of Procedure, are set 
out in 7 CFR part 24.



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 267]]





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



                         Subpart 434.0--General



434.001  Definitions.

    Pursuant to OMB Circular No. A-109 (A-109) and the definition at FAR 
34.001, within USDA, a system shall be considered a major system if:
    (a) The total acquisition costs with private industry are estimated 
to be $50 million or more, or
    (b) The system has been specifically designated to be a major system 
by the USDA Acquisition Executive, even if the acquisition costs are not 
expected to exceed $50 million.



434.002  Policy.

    In addition to the policy guidance at FAR 34.002, 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 Assistant Secretary for Administration (ASA) is the USDA 
Acquisition Executive. 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.
    (c) The Procurement and Property Management staff is responsible for 
assisting the ASA in carrying out the above responsibilities.
    (d) Heads of contracting activities must:
    (1) Ensure compliance with the requirements of A-109, FAR part 34 
and AGAR 434.
    (2) Ensure that potential major system acquisitions are brought to 
the attention of the USDA Acquisition Executive.
    (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 in implementing the requirements of A-
109.
    (e) The program manager is responsible for planning and executing 
the major system acquisition, ensuring appropriate coordination with the 
USDA Acquisition Executive and other key USDA executives.



434.004  Acquisition strategy.

    (a) The program manager will develop, in coordination with the 
Acquisition 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, 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.

[[Page 268]]

    (c) Upon initiation of the project, the program manager will report 
regularly to the Acquisition Executive.



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.

    Subpart 436.3--Special Aspects of Sealed Bidding in Construction 
                               Contracting

436.302  Presolicitation notices.

                     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  Standard specifications for construction of roads and bridges.
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.
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

[[Page 269]]

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.



    Subpart 436.3--Special Aspects of Sealed Bidding in Construction 
                               Contracting



436.302  Presolicitation notices.

    The authority to waive a presolicitation notice is restricted to the 
HCA.



                     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.



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-

[[Page 270]]

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 contractor's work 
schedule is restricted by access to the facility or must be coordinated 
with the schedule of contract administration personnel.



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  Standard specifications for construction of roads and bridges.

    The contracting officer shall insert the clause at 452.236-78, 
Forest Service Standard Specifications for Construction of Roads and 
Bridges, in construction contracts that incorporate the standard 
specifications.



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.



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.

[[Page 271]]



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.
437.270  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.



                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.

[[Page 272]]

    (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).



437.270  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.



PARTS 438--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 273]]





                    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 head of the contracting activity shall be responsible for 
establishing past performance evaluation procedures and systems as 
required by FAR 42.1502 and 42.1503.



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--Reporting, Redistribution and Disposal of Contractor 
                                Inventory

445.608  Screening of contracting inventory.
445.608-6  Waiver of screening 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 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).



     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).

[[Page 274]]



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--Reporting, Redistribution and Disposal of Contractor 
                                Inventory



445.608  Screening of contractor inventory.



445.608-6  Waiver of screening requirements.

    Requests to waive screening requirements as prescribed in FAR 
46.608-6 shall be submitted by the HCA to the SPE for approval.



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]






PART 449--TERMINATION OF CONTRACTS--Table of Contents




                    Subpart 449.1--General Principles

Sec.
449.106  Fraud or other criminal conduct.

[[Page 275]]

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--General

450.104  Reports.

  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.



                         Subpart 450.1--General



450.104  Reports.

    The Senior Procurement Executive shall prepare the report required 
by FAR 50.104.

[[Page 276]]



  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 277]]

--Table of Contents






                     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.
452.211-1  Brand Name or Equal.
452.211-2  Equal Products Offered.
452.211-3  Statement of Work/Specifications.
452.211-4  Attachments to Statement of Work/Specifications.
452.211-5  Period of Performance.
452.211-6  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 SIC Code Information.
452.224-70  Confidentiality of Information.
452.228-70  Alternative Forms of Security.
452.228-71  Insurance Coverage.
452.232-1  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  Forest Service Standard Specifications for Construction of 
          Roads and Bridges.
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)



452.211-1  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 
452.211-2) 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 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

[[Page 278]]

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)



452.211-2  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)



452.211-3  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)



452.211-4  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)



452.211-5  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 
______.*

                             (End of Clause)

    * Contracting Officer shall insert the appropriate dates. 



452.211-6  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 
______.*

[[Page 279]]

                             (End of Clause)

    * Contracting Officer shall insert the appropriate dates. 



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 415.407(a), insert a provision substantially as 
follows:

  INSTRUCTIONS FOR THE PREPARATION OF TECHNICAL AND BUSINESS PROPOSALS 
                               (NOV 1996)

    (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 52.215-41, Requirements for Cost or Pricing Data 
or Other Than Cost of Pricing Data (OCT 1995), 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.
    (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.
    Alternate I (NOV 1996): When FAR clause 52.215-41 is not used to 
specify the cost/price information requirements and cost and pricing 
data is required substitute the following for subparagraph (1):
    (c)(1) Cost and pricing data is required. Cost proposals must be 
submitted on a

[[Page 280]]

Standard Form 1411, Contract Pricing Proposal Cover Sheet, with 
supporting attachments in accordance with FAR Table 15-2, Instructions 
for Submission of a Contract Pricing Proposal.
    Alternate II (NOV 1996): When FAR clause 52.215-41 is not used and 
use of a SF 1448 is required for submission of other than cost and 
pricing data, substitute the following subparagraph for (c)(1) above:
    (c)(1) Cost proposals must be submitted on a Standard Form 1448, 
Proposal Cover Sheet (Cost or Pricing Data Not Required), in accordance 
with FAR Table 15-3, Instructions for Submission of Information Other 
Than Cost or Pricing Data.



452.215-72  Amendments to Proposals.

    As prescribed in 415.407(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)



452.215-73  Post Award Conference.

    As prescribed in 415.1070, 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.



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 FEE 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:

             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 ______*.

[[Page 281]]

                             (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 SIC Code Information.

    As prescribed in 419.508, insert the following provision:

            SIZE STANDARD AND SIC CODE INFORMATION (NOV 1996)

    The Standard Industrial Classification 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): ______* SIC 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.



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.
    (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

[[Page 282]]

is subject to conflicting or overlapping provisions in other Federal, 
State or local laws.

                             (End of Clause)



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.



452.232-1  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 
Contract, shall not cover any amount therefor not included in the 
contract price.

                             (End of clause)



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

[[Page 283]]

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.
    (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:

[[Page 284]]

           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  Forest Service Standard Specifications for Construction of Roads and Bridges.

    As prescribed in 436.578, insert the following clause:

  FOREST SERVICE STANDARD SPECIFICATIONS FOR CONSTRUCTION OF ROADS AND 
                           BRIDGES (NOV 1996)

    The Forest Service Standard Specifications for Construction of Roads 
and Bridges, XXXX 199X are included by reference. The requirements 
contained in these specifications are hereby made a part of this 
solicitation and any resultant contract.

                             (End of Clause)



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.

[[Page 285]]



452.236-80  Firms Ineligible for Award--Construction.

    As prescribed in 436.670, insert the following clause:

           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.

[[Page 286]]

                             (End of Clause)

    *Contracting Officer shall insert appropriate data.



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).

[[Page 287]]

    (2) The estimated cost expended during the current reporting period.
    (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 288]]

                  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.



Sec. 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 (see 413.505-1).



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 289]]



               CHAPTER 5--GENERAL SERVICES ADMINISTRATION




                           (Parts 500 to 599)

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

                          SUBCHAPTER A--GENERAL
Part                                                                Page
501             General Services Administration Acquisition 
                    Regulation System.......................         292
502             Definitions of words and terms..............         296
503             Improper business practices and personal 
                    conflicts of interest...................         297
504             Administrative matters......................         304
           SUBCHAPTER B--COMPETITION AND ACQUISITION PLANNING
505             Publicizing contract actions................         314
506             Competition requirements....................         317
507             Acquisition planning........................         318
508             Required sources of supplies and services...         320
509             Contractor qualifications...................         321
510

Market research [Reserved]

511             Describing agency needs.....................         326
512             Acquisition of commercial items.............         329
          SUBCHAPTER C--CONTRACTING METHODS AND CONTRACT TYPES
513             Simplified acquisition procedures...........         331
514             Sealed bidding..............................         334
515             Contracting by negotiation..................         345
516             Types of contracts..........................         356
517             Special contracting methods.................         358
518

[Reserved]

                  SUBCHAPTER D--SOCIOECONOMIC PROGRAMS
519             Small business programs.....................         361
520

[Reserved]

521

[Reserved]

522             Application of labor laws to Government 
                    acquisitions............................         364

[[Page 290]]

523             Environment, conservation, and occupational 
                    safety..................................         369
524             Protection of privacy and freedom of 
                    information.............................         370
525             Foreign acquisition.........................         370
526

[Reserved]

             SUBCHAPTER E--GENERAL CONTRACTING REQUIREMENTS
527             Patents, data, and copyrights...............         376
528             Bonds and insurance.........................         376
529             Taxes.......................................         379
530             Cost accounting standards...................         379
531             Contract cost principles and procedures.....         379
532             Contract financing..........................         379
533             Protests, disputes, and appeals.............         385
             SUBCHAPTER F--SPECIAL CATEGORIES OF CONTRACTING
534             Major system acquisition....................         393
535

Research and development contracting--[Reserved]

536             Construction and architect-engineer 
                    contracts...............................         393
537             Service contracting.........................         398
538             FSS schedule contracting....................         398
539

Management, acquisition, and use of information resources--[Reserved]

540

[Reserved]

541             Acquisition of utility services.............         400
                    SUBCHAPTER G--CONTRACT MANAGEMENT
542             Contract administration.....................         401
543             Contract modification.......................         406
544

Subcontracting policies and procedures--[Reserved]

545             Government property.........................         407
546             Quality assurance...........................         407
547             Transportation..............................         409
548

Value engineering--[Reserved]

549             Termination of contracts....................         410
550             Extraordinary contractual actions...........         411
551

Use of Government sources by contractors--[Reserved]

                     SUBCHAPTER H--CLAUSES AND FORMS
552             Solicitation provisions and contract clauses         412

[[Page 291]]

553             Forms.......................................         474
                       SUBCHAPTERS I-M--[RESERVED]
               SUBCHAPTER N--SPECIAL CONTRACTING PROGRAMS
570             Acquisition of leasehold interests in real 
                    property................................         476

      Appendix A--Contracting Office Assignment Codes.......         489

[[Page 292]]





                          SUBCHAPTER A--GENERAL





PART 501--GENERAL SERVICES ADMINISTRATION ACQUISITION REGULATION SYSTEM--Table of Contents




               Subpart 501.1--Purpose, Authority, Issuance

Sec.
501.102  Authority.
501.103  Applicability.
501.104  Issuance.
501.104-1  Publication and code arrangement.
501.104-2  Arrangement of regulations.
501.104-3  Copies.
501.105  OMB approval under the Paperwork Reduction Act.
501.170  Other GSA publications.
501.170-1  GSA orders and handbooks.
501.170-2  Acquisition letters.

             Subpart 501.4--Deviations From the FAR and GSAR

501.402  Policy.
501.403  Individual deviations.
501.404  Class deviations.

        Subpart 501.6--Contracting Authority and Responsibilities

501.601  General.
501.602  Contracting officers.
501.602-2  Responsibilities.
501.602-3  Ratification of unauthorized commitments.
501.603-1  General.

               Subpart 501-7--Determinations and Findings

501.707  Signatory authority.

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

    Source:  54 FR 26486, June 23, 1989, unless otherwise noted.



               Subpart 501.1--Purpose, Authority, Issuance



501.102  Authority.

    The General Services Administration Acquisition Regulation (GSAR) is 
issued and maintained by the Associate Administrator for Acquisition 
Policy under the authority of the Federal Property and Administrative 
Services Act of 1949, as amended.



501.103  Applicability.

    (a) This regulation applies to contracts for supplies or services 
(including construction).
    (b) Parts 501, 502, 503, 505, 506, 517, 530, 533, 552, 553, 570, and 
subparts 504.2, 504.9, 509.4, 515.1, 519.3, 519.6, 519.7, 522.8, 522.13, 
522.14, 532.1, 532.4, 532.6, 532.8, and 532.9 apply to leases of real 
property. Other provisions of the (GSAR) 48 CFR chapter 5 do not apply 
to leases of real property unless a specific cross-reference is made in 
part 570.
    (c) This regulation applies to the disposal of real and personal 
property only to the extent explicitly stated. The portions of Subpart 
501.6 regarding the Contracting Officer Warrant Program and legal review 
and assistance, and Subpart 504.70 on the uniform procurement instrument 
identification system apply to the disposal of real or personal 
property. Subpart 509.4 regarding suspension and debarment of 
contractors is applicable to contracts for the disposal of personal 
property (see FPMR Subpart 101-45.6).
    (d) This regulation may deviate from the Federal Acquisition 
Regulation (FAR) when authorized. (See FAR Subpart 1.4 and Subpart 
501.4.) When the GSAR does not implement the FAR, the FAR alone governs.
[54 FR 26486, June 23, 1989, as amended at 60 FR 42794, Aug. 17, 1995]



501.104  Issuance.



501.104-1  Publication and code arrangement.

    The GSAR is published in the daily issue of the Federal Register, a 
cumulated form in the Code of Federal Regulations (CFR), and a separate 
loose-leaf edition.



501.104-2  Arrangement of regulations.

    (a) The numbering system used in GSAR conforms to the FAR System. A 
particular policy or procedure is identified by the same number in both 
the FAR and GSAR.
    (b) When the GSAR implements the FAR, the GSAR is numbered (and 
captioned) to correspond to the FAR part,

[[Page 293]]

subpart, section, or subsection being implemented.
    (c) When the GSAR supplements the FAR by dealing with subject matter 
not in the FAR, numbers beginning with 70 are assigned to the 
supplementing part, subpart, section, or subsection.
    (d) When the FAR requires no implementation, the GSAR will not 
contain corresponding citations. This will result in some gaps in the 
GSAR. In such cases, see the FAR for policies and procedures.



501.104-3  Copies.

    Copies of the GSAR in CFR form may be purchased from the 
Superintendent of Documents, Government Printing Office (GPO), 
Washington, DC 20402.



501.105  OMB approval under the Paperwork Reduction Act.

    The following OMB control numbers apply:

------------------------------------------------------------------------
               GSAR reference                      OMB control No.      
------------------------------------------------------------------------
509.105-1(a)...............................  3090-0007                  
511.170(b)(3)..............................  3090-0203                  
511.204(g).................................  3090-0246                  
511.404(a)(2)..............................  3090-0204                  
511.404(a)(5)..............................  3090-0204                  
514.201(7)(a)..............................  3090-0200                  
516.203-4(b)...............................  3090-0243                  
516.505....................................  3090-0248                  
519.708(b).................................  3090-0252                  
522.406-6..................................  1215-0140                  
523.370....................................  3090-0205                  
525.105-70(d)..............................  3090-0198                  
525.205....................................  3090-0240                  
532.502-3..................................  3090-0229                  
532.905-70.................................  9000-0102                  
532.905-71.................................  3090-0080                  
537.110(a).................................  3090-0197                  
537.110(b).................................  3090-0006                  
538.203-71(a)..............................  3090-0121                  
538.203-71(b)..............................  3090-0250                  
538.203-71(d)..............................  3090-0262                  
542.1107...................................  3090-0027                  
546.302-70.................................  3090-0027                  
546.302-71.................................  3090-0027                  
546.570....................................  3090-0227                  
552.210-74.................................  3090-0203                  
552.210-79.................................  3090-0246                  
552.212-1..................................  3090-0204                  
552.212-71.................................  3090-0204                  
552.214-75.................................  3090-0200                  
552.216-71.................................  3090-0243                  
552.216-73.................................  3090-0248                  
552.216-74.................................  3090-0248                  
552.219-73.................................  3090-0252                  
552.223-71.................................  3090-0205                  
552.225-70.................................  3090-0198                  
552.225-75.................................  3090-0240                  
552.228-74.................................  3090-0189                  
552.232-74.................................  3090-0229                  
552.232-79.................................  3090-0080                  
552.237-70.................................  3090-0197                  
552.237-71.................................  3090-0006                  
552.238-70.................................  3090-0250                  
552.238-72.................................  3090-0121                  
552.238-75.................................  3090-0262                  
552.242-70.................................  3090-0027                  
552.246-70.................................  3090-0027                  
552.246-72.................................  3090-0027                  
552.249-71.................................  3090-0227                  
GSA-72.....................................  3090-0121                  
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                  
570.802(c).................................  3090-0086                  
------------------------------------------------------------------------

[60 FR 63260, Dec. 8, 1994, as amended at 61 FR 6164, Feb. 16, 1996; 61 
FR 14033, Mar. 29, 1996]



501.170  Other GSA publications.



501.170-1  GSA orders and handbooks.

    Internal agency guidance, as described in FAR 1.301(a)(2), must be 
issued by heads of contracting activities in the form of a GSA order or 
handbook. GSA orders and handbooks must not unnecessarily repeat, 
paraphrase, or otherwise restate the FAR and GSAR. Policies and 
procedures for issuing GSA orders and handbooks are in the HB, Writing 
GSA Internal Directives (OAD P 1832.3A).
[57 FR 14649, Apr. 22, 1992]



501.170-2  Acquisition letters.

    (a) Acquisition letters may be issued to provide coverage on an 
interim basis, pending incorporation of material in GSA orders or 
handbooks. Acquisition letters will be considered canceled after one 
year and therefore must be incorporated into the applicable order or 
handbook within that time period.
    (b) The heads of contracting activities (HCA's) or their designees 
may issue acquisition letters. Normally no more than two officials 
within a contracting activity, as appropriate, may be designated to 
issue acquisition letters.
    (c) Acquisition letters must be coordinated with appropriate offices 
including Acquisition Policy, Counsel, and the Inspector General. 
Proposed procedures affecting the operation of

[[Page 294]]

the small business program must be coordinated with the Office of Small 
and Disadvantaged Business Utilization (AU).
    (d) Acquisition letters must be identified by a number assigned by 
the issuing activity. The number should begin with the correspondence 
symbol of the issuing office, followed by the last two digits of the 
calendar year in which it is issued and be numbered consecutively 
beginning with 1. For example, the number of the first letter issued by 
the Commissioner, Public Buildings Service, in calendar year 1989 will 
be P-89-1.
    (e) The body of the acquisition letter should contain the following 
paragraphs, as appropriate:
    (1) Purpose.
    (2) Background.
    (3) Effective date.
    (4) Termination date.
    (5) Cancellation.
    (6) Applicability (offices to which acquisition letter is 
applicable).
    (7) Reference to regulations (FAR or GSAR), handbooks, or orders.
    (8) Instructions/procedures.
    (f) The issuing office is responsible for distributing its 
acquisition letters to affected contracting activities, regional 
Acquisition Management Staffs (RAMS), the Office of Acquisition Policy, 
appropriate Central Office contracting activities, Associate General 
Counsels, Regional Counsels, Directives and Correspondence Management 
Branch in Central Office, and Information Management Branches in the 
regions. In Region 3, it is the Administrative Operations Branch.
    (g) Each issuing office must report on acquisition letters issued 
and canceled on a quarterly basis so that the Office of Acquisition 
Policy can issue a consolidated index of all acquisition letters issued 
or canceled. The index will be distributed to GSA contracting 
activities.



             Subpart 501.4--Deviations From the FAR and GSAR

    Source: 61 FR 51374, Oct. 2, 1996, unless otherwise noted.



501.402  Policy.

    (a) Uniformity is an objective of the GSA Acquisition Regulatory 
System. However, the desire for consistency of action by GSA contracting 
activities must not restrict or discourage development and testing of 
new procedures and techniques. Similarly, the desire for consistency 
must not prevent GSA contracting activities from adopting alternate 
procedures determined to be in the Government's interest based on unique 
programmatic or managerial considerations.
    (b) A contracting activity may deviate from a regulatory provision 
which implements a statutory requirement only to the extent that the 
deviation does not violate the underlying statute.
    (c) Deviations must not be used to defeat the FAR and GSAR approval 
requirements.



501.403  Individual deviations.

    Individual deviations from the GSAR or the FAR must be approved by 
the Contracting Director. A copy must be submitted to GSA's Senior 
Procurement Executive (MV).



501.404  Class deviations.

    (a) Class deviations from the FAR or the GSAR must be approved by 
the head of the contracting activity (HCA). A copy must be submitted to 
GSA's Senior Procurement Executive (MV).
    (b) Requests for class deviations must be supported by statements 
that disclose the need for and the nature of the deviation.
    (c) Class deviations from the GSAR will expire in 12 months if not 
extended. They may be rescinded earlier by the Senior Procurement 
Executive or the HCA without prejudice to any action previously taken.



        Subpart 501.6--Contracting Authority and Responsibilities



501.601  General.

    Heads of contracting activities (see 502.1) are contracting officers 
by virtue of their position. Other contracting officers are appointed 
under FAR 1.603

[[Page 295]]

and GSA's contracting officer warrant program.
[60 FR 40108, Aug. 7, 1995]



501.602  Contracting officers.



501.602-2  Responsibilities.

    (a) GSA revolving funds. Unless otherwise notified, contracting 
officers may assume that sufficient funds are available for purchases 
payable from GSA revolving funds upon the receipt of a requisition 
signed by an authorized individual citing such funds. Requisitions for 
indefinite delivery contracts which provide for a guaranteed minimum 
must cite funds adequate to cover the guaranteed minimum quantities.
    (b) GSA funds, other than revolving funds. (1) A requisition signed 
by an authorized individual may be considered as evidence that funds 
cited are available for purchases payable from GSA funds other than 
revolving funds. A certification that additional funds are available 
must be obtained from the requisitioning activity before awarding a 
contract or purchase order when the purchase exceeds (by 10 percent or 
$50, whichever is greater) the dollar amount of funds cited on the 
purchase requisition.
    (2) When a requisition is not used, e.g., lease of real property, 
the contracting officer must ensure funds are available before awarding 
the contract.
    (c) Other Federal agencies' funds. For purchases for direct delivery 
to Federal agencies other than GSA, the receipt of a properly signed/
approved purchase request is sufficient evidence that funds are 
available. Where, however, the agency's purchase request indicates that 
a specific dollar amount has been set aside for the acquisition, as in 
the case of a Project Implementation Order/Commodities (PIO/C) from the 
Agency for International Development, the buying activity must not 
exceed the fund limitation except to the extent authorized in supply 
support agreements. When the funds stated on the purchase request appear 
to be or are insufficient to cover costs for the acquisition, 
transportation, export surcharge, and any other expense involved in the 
delivery of material to designated consignees, additional funds must be 
obtained from the requiring agency before the acquisition is completed 
as indicated below:
    (1) When requirements are submitted by agencies directly to a 
contracting division in the Central Office (regardless of where the 
procurement is actually made), the request for additional funds should 
be made by the Central Office contracting division.
    (2) When requirements are submitted to a regional contracting 
division (regardless of where the acquisition is made), the request for 
additional funds will be made by the order processing and control 
activity in the region initially receiving the requirement.
[54 FR 26486, June 23, 1989, as amended at 56 FR 15288, Apr. 16, 1991]



501.602-3  Ratification of unauthorized commitments.

    (a) Authority. Under FAR 1.602-3, contracting officers may ratify 
unauthorized contractual commitments if the HCA approves the 
ratification action. The HCA may not redelegate this authority.
    (b) Procedures. (1) Generally, the Government is not bound by 
commitments made by persons who do not have contracting authority. Such 
unauthorized acts may violate laws or regulations. Therefore, 
unauthorized commitments should be considered as serious employee 
misconduct and consideration given to initiating disciplinary action. If 
suspected irregularities may involve fraud against the Government, or 
any type of misconduct that might be punishable as a criminal offense, 
either the employee's supervisor or the contracting officer must 
immediately report the matter to the Office of the Inspector General 
with a request for a complete investigation.
    (2) The individual who made the unauthorized commitment shall 
furnish the appropriate contracting director all records and documents 
concerning the commitment and a complete written statement of facts, 
including, but not limited to, a statement as to why normal acquisition 
procedures were not followed, why the contractor was selected and a list 
of other sources considered, description of work or products, estimated 
or agreed-upon contract price, citation of appropriation available, and 
a statement regarding

[[Page 296]]

the status of the performance. Under exceptional circumstances, such as 
when the person who made the unauthorized commitment is no longer 
available to attest to the circumstances of the unauthorized commitment, 
the contracting director may waive the requirement that the responsible 
employee initiate and document the request for ratification, provided 
that a written determination is made stating that a commitment was in 
fact made by an employee, who must be identified in the determination.
    (3) The contracting director will assign the request to a 
contracting officer for processing. The contracting officer shall 
prepare a summary statement of facts addressing the limitations in FAR 
1.602-3(c) recommending whether or not the transaction should be 
ratified. Advice against express ratification should include a 
recommendation for other appropriate disposition. When ratification is 
not permissible due to legal improprieties in the procurement, the 
contracting officer may recommend that payment be made for services 
rendered on a quantum meruit basis (the reasonable value of work or 
labor) or for goods furnished on a quantum valebant basis (the 
reasonable value of goods sold and delivered) provided there is a 
showing that the Government has received a benefit. (See FAR 1.602-
3(d).)
    (4) The request for ratification, the information required by 
paragraph (b)(3) of this section and a recommendation for corrective 
action to preclude recurrence, must be forwarded, through appropriate 
channels to the HCA for consideration.
    (5) The HCA shall approve the ratification in writing, or direct 
other disposition as appropriate. Acquisitions approved for ratification 
are returned to the contracting officer for issuance of the necessary 
contractual documents. If the request for ratification is not justified, 
the HCA will return the request without approval and provide a written 
explanation for the decision not to approve ratification.
    (6) HCAs shall maintain a separate file containing a copy of each 
request for approval to ratify an unauthorized contractual commitment 
and a copy of the response. This file must be made available for review 
by the Office of Acquisition Policy and the Inspector General.



501.603-1  General.

    The contracting officer warrant program (COWP) is the system 
established for the selection, appointment, and termination of 
appointment of contracting officers.



               Subpart 501.7--Determinations and Findings



501.707  Signatory authority.

    The FAR frequently refers to determinations being made by the agency 
head. Section 309 of the Federal Property and Administrative Services 
Act defines agency head and provides that at the option of the 
Administrator, the term may include the chief official of any principal 
organizational unit of the GSA. The Administrator has authorized the 
heads of contracting activities to act as agency head to facilitate the 
procurement of property and services under Title III of the Federal 
Property and Administrative Services Act. (See GSA Delegation of 
Authority Manual, ADM P 5450.39C.) When the applicable statute precludes 
redelegation of the authority, the Administrator must sign the D&F (see 
for example, FAR 6.302-7). Class D&Fs, if authorized, must be signed by 
the HCA.
[60 FR 54955, Oct. 27, 1995]



PART 502--DEFINITIONS OF WORDS AND TERMS--Table of Contents






                       Subpart 502.1--Definitions



502.101  Definitions.

    Agency competition advocate means the GSA Competition Advocate 
located in the Office of Acquisition Policy.
    Chief of the contracting office means branch chiefs of Central 
Office or regional office branches within divisions that are responsible 
for performing contracting and/or contract administration functions 
except for FSS. In FSS Commodity Centers, ``chief of contracting 
office'' means division directors within the Commodity Centers. In 
Federal Supply Service Bureaus, ``Chief of Contracting Office'' means

[[Page 297]]

branch chiefs or supervisory equivalents. In PBS, the Director of a 
Facility Support Center is considered to be the ``chief of the 
contracting office.''
    Contracting activity competition advocate means the individual 
designated in writing by the head of the contracting activity. 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 directors of Central Office or regional 
office divisions that are responsible for performing contracting and/or 
contract administration functions except for FSS. ``Contracting 
director'' means directors of Commodity Centers and Federal Supply 
Service Bureaus in the FSS.
    Head of the contracting activity means the Associate Administrator 
for Acquisition Policy, Associate Administrator for Federal 
Telecommunications Service (FTS), Commissioners of the Federal Supply 
Services (FSS), Information Technology Services (ITS), Public Buildings 
Service (PBS), or Regional Administrators. The Associate Administrator 
for Acquisition Policy serves as the HCA for Central Office contracting 
activities outside of FTS, FSS, ITS and PBS.
    Senior procurement executive means the Associate Administrator for 
Acquisition Policy.
[57 FR 9213, Mar. 17, 1992, as amended at 57 FR 61583, Dec. 28, 1992; 60 
FR 21467, May 2, 1995; 60 FR 54957, Oct. 27, 1995]



PART 503--IMPROPER BUSINESS PRACTICES AND PERSONAL CONFLICTS OF INTEREST--Table of Contents




                        Subpart 503.1--Safeguards

Sec.
503.101  Standards of conduct.
503.101-3  Agency regulations.
503.104  Procurement integrity.
503.104-4  Definitions.
503.104-5  Disclosure, protection, and marking of proprietary and source 
          selection information.
503.104-7  Postemployment restriction applicable to Government officers 
          and employees serving as procurement officers and 
          certifications required from procurement officials leaving 
          Government service.
503.104-8  Knowing violations, duty to inquire, and ethics advisory 
          opinions.
503.104-9  Certification requirement.
503.104-10  Solicitation provisions and contract clauses.
503.104-11  Processing violations or possible violations.
503.104-12  Ethics program training requirements.

      Subpart 503.2--Contractor Gratuities to Government Personnel

503.203  Reporting suspected violations of the Gratuities clause.
503.204  Treatment of violations.

        Subpart 503.3--Reports of Suspected Antitrust Violations

503.303  Reporting suspected antitrust violations.

                     Subpart 503.4--Contingent Fees

503.404  Solicitation provision and contract clause.
503.408  Evaluation of the SF 119.
503.408-1  Responsibilities.
503.409  Misrepresentations or violations of the Covenant Against 
          Contingent Fees.

            Subpart 503.5--Other Improper Business Practices

503.570  Advertising.
503.570-1  Policy.
503.570-2  Contract clause.

  Subpart 503.6--Contracts with Government Employees or Organizations 
                       Owned or Controlled by Them

503.602  Exceptions.
503.603  Responsibilities of the contracting officer.

             Subpart 503.7--Voiding and Rescinding Contracts

503.702  Definitions.
503.705  Procedures.

   Subpart 503.8--Limitation on Payment of Funds To Influence Federal 
                              Transactions

503.804  Policy.
503.806  Processing suspected violations.

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

    Source:  54 FR 26496, June 23, 1989, unless otherwise noted.

[[Page 298]]



                        Subpart 503.1--Safeguards



503.101  Standards of conduct.



503.101-3  Agency regulations.

    (a) GSA Standards of Conduct are in Part 105-735 of the General 
Services Administration Property Management Regulations (GSPMR) (ADM 
7900.9). Authorized exceptions to FAR 3.101-2 are in GSPMR 105-
735.202(e). Enforcement procedures are in GSPMR 105-735.101.
    (b) The requirement for employee financial disclosure and 
restrictions on private employment for former Government employees are 
in GSPMR 105-735.4 and 105-735.6.



503.104  Procurement integrity.



503.104-4  Definitions.

    Property, as used in FAR 3.104 and in this section, also means 
acquisitions of leasehold interests in real property.
[55 FR 39972, Oct. 1, 1990]



503.104-5  Disclosure, protection, and marking of proprietary and source selection information.

    (a) The contracting officer or any other individual who prepares, 
makes or controls proprietary and source selection information shall--
    (1) Ensure documents are marked as prescribed in FAR 3.104-5(c).
    (2) Provide physical security for documents in the office 
environment during and after duty hours.
    (3) Ensure security of interoffice mailing of documents by using 
opaque envelopes, ``double wrapping'' with more than one envelope and 
sealing of envelopes.
    (4) Maintain strict control over oral communications regarding the 
acquisition.
    (b) The GSA Form 3611, Cover Page Source Selection Information, may 
be used as the cover page for documents that contain source selection 
information. The use of the GSA Form 3611 does not eliminate the 
requirement to mark each page of the document that contains source 
selection information.
    (c)(1) The following classes of persons are authorized access to 
proprietary and source selection information to the extent necessary to 
accomplish their requisite duties and responsibilities with respect to a 
particular procurement:
    (i) Requirements generators, including client agency 
representatives, program and technical experts involved in the 
development of statements of work, specifications or similar documents.
    (ii) Contracting personnel acting in support of the contracting 
officer.
    (iii) Secretarial, clerical and administrative personnel of the 
contracting activity directly involved in the procurement.
    (iv) Supervisors in the contracting officer's chain of command.
    (v) Attorneys in the Office of General Counsel and Regional 
Counsel's Offices.
    (vi) Contract auditors in the Office of Inspector General and 
Regional Inspector General's offices.
    (vii) Engineers and other technical support personnel who provide 
support to the contracting officer.
    (viii) Small Business Technical Advisors.
    (ix) Small Business Administration (SBA) personnel responsible for 
reviewing determining not to set-aside acquisitions, determining the 
small business status of offerors under FAR 19.302, processing 
applications for Certificates of Competency under FAR subpart 19.6, 
reviewing subcontracting plans, or awarding contracts under the 8(a) 
program.
    (x) Department of Labor (DOL) personnel responsible for making 
eligibility determinations under the Walsh-Healey Public Contracts Act 
or for processing preaward EEO clearances under FAR 22.805.
    (xi) Personnel in the Credit and Finance Branch, Region 6, and other 
personnel who provide support to the contracting officer in making 
contractor responsibility determinations.
    (xii) Personnel serving on technical evaluation boards or source 
selection evaluation boards.
    (xiii) Contract clearance personnel.
    (2) The Associate Administrator for Acquisition Policy may authorize 
additional classes of persons access to proprietary or source selection 
information.
    (3) The contracting officer may authorize persons access to 
proprietary or

[[Page 299]]

source selection information when such access is necessary to the 
conduct of the procurement and to the extent that the person has a 
``bona fide need to know.'' Access must be limited to only that 
information needed by the person to perform his/her responsibilities.
    (4) The GSA Form 3617, Record of Authorization of Access to 
Proprietary or Source Selection Information, may be used to comply with 
the requirement at FAR 3.104-5(d)(2) to maintain the list of individuals 
authorized access to proprietary or source selection information at the 
contracting activity.
    (5) Release of proprietary or source selection information under FAR 
3.104-5(d)(3) must be made by letter citing obligation to maintain a 
list of persons authorized access to proprietary or source selection 
information and to provide the list to the contracting officer for 
inclusion in the contract file.
    (6) In accordance with FAR 3.104-5(i), the following caution notice 
must be prominently displayed on any document that releases proprietary 
or source selection information:

    This document, or portions thereof, contains proprietary or source 
selection information related to the conduct of a Federal agency 
procurement, the disclosure of which is restricted by section 27 of the 
Office of Federal Procurement Policy Act (41 U.S.C. 423). The 
unauthorized disclosure of such information may subject both the 
discloser and recipient of the information to contractual, civil, and/or 
criminal penalties as provided by law.

    (7) For requests from an individual Member of Congress see 505.403.
[55 FR 39972, Oct. 1, 1990, as amended at 55 FR 50700, Dec. 12, 1990]



Sec. 503.104-7  Postemployment restriction applicable to Government officers and employees serving as procurement officials and certifications required from 
          procurement officials leaving Government service.

    (a) The supervisor of each departing GSA employee shall remind the 
departing employee that:
    (1) He/she is presumed to know if he/she is a procurement official 
(see FAR 3.104-8(b)(2));
    (2) If he/she is a procurement official at the time of departure, 
he/she is subject to certain postemployment restrictions (see FAR 3.104-
7), and
    (3) If he/she leaves the Government during the conduct of a 
procurement expected to result in a contract or modification in excess 
of $100,000, he/she must certify to the contracting officer that he/she 
understands the continuing obligation, during the conduct of the 
procurement, not to disclose proprietary or source selection information 
related to the procurement.

A procurement is not considered complete until all actions associated 
with the award or modification of the procurement have been taken. A 
departing employee must submit the certification to the contracting 
officer if he/she participated, in a contract or modification expected 
to exceed $100,000 that has not been completed, even though his/her 
duties may be complete at the time of departure. The GSA Form 3608, 
Procurement Integrity Certification of Departing GSA Procurement 
Officials, must be used by departing employees to make the required 
certification to contracting officers. The departing employee may list 
all contracts or modifications for which he/she is a procurement 
official on the GSA Form 3608. The original or a copy of the form must 
be submitted to the contracting officer for each contract or 
modification listed. Each copy must be annotated to identify the 
contracting officer who received the original certification and the 
contract number of the contract that the contracting officer is 
responsible for so that the contract file with the original 
certification can be retrieved, if necessary.
    (b) The contracting officer shall obtain the GSA Form 3608 from any 
contractor employee serving as a procurement official who ceases 
performance of those duties during the conduct of a procurement expected 
to result in a contract or modification in excess of $100,000. (See FAR 
3.104-10(d) and 52.203-13).
[55 FR 39972, Oct. 1, 1990, as amended at 55 FR 50700, Dec. 12, 1990]



503.104-8  Knowing violations, duty to inquire, and ethics advisory opinions.

    If a contracting officer has not been appointed, the contracting 
director

[[Page 300]]

shall serve as the Administrator's designee and respond to inquiries 
under FAR 3.104-8(d) and (e) regarding proprietary and source selection 
information.
[58 FR 52443, Oct. 8, 1993]



503.104-9  Certification requirement.

    Contracting Officer shall submit requests for waiver of 
certification requirements under FAR 3.104-9(f)(2) to the HCA for 
transmittal to the Senior Procurement Executive (see 502.101). The 
Senior Procurement Executive will recommend that the Administrator 
approve or disapprove the request.
[55 FR 39972, Oct. 1, 1990]



503.104-10  Solicitation provisions and contract clauses.

    (a) The contracting officer may insert the provision at 552.203-71, 
Prohibited Conduct, in solicitations for the acquisition of leasehold 
interests in real property if there is a need to inform prospective 
offerors of certain conduct which is prohibited by law.
    (b) The contracting officer shall insert the provision at 552.203-
72, Requirement for Certificate of Procurement Integrity, in 
solicitations for the acquisition of leasehold interests in real 
property expected to exceed $100,000, unless:
    (1) Pursuant to FAR 3.104-9(f) a certification is not required.
    (2) A waiver has been granted, or
    (3) Simplified procedures are being used (see 570.2).
    (c) The contracting officer shall insert a clause substantially the 
same as the clause at 552.203-73, Price Adjustments for Illegal or 
Improper Activity, in solicitations and contracts for the acquisition of 
leasehold interests in real property expected to exceed $100,000 and all 
modifications to leases exceeding $100,000 which do not already contain 
the clause.
[55 FR 39973, Oct. 1, 1990, as amended at 57 FR 37889, Aug. 21, 1992; 60 
FR 42794, Aug. 17, 1995]



503.104-11  Processing violations or possible violations.

    (a)(1) The contracting officer's determination that a reported 
violation or possible violation of the statutory prohibitions has no 
impact on the pending award or selection of a source shall be submitted, 
along with supporting documentation, to the HCA or SES designee for 
review and concurrence before award of a contract. In addition, the 
nature and circumstances of the violation or possible violation, 
together with any supporting documentation, must be referred to the 
Inspector General in accordance with agency regulations.
    (2) The contracting officer's determination that a reported 
violation or possible violation of the statutory prohibitions has an 
impact on the pending award or selection of a source must be referred 
along with all related information available to the HCA, who will:
    (i) Refer the matter immediately to the Inspector General.
    (ii) Determine the action to be taken on the procurement in 
accordance with FAR 3.104-11 (b) and (d).
    (b) If the HCA or SES designee determines under FAR 3.104-11(f) that 
there are urgent and compelling circumstances, or that it is otherwise 
in the Governments interest to award or modify a contract, the HCA or 
SES designee shall notify the Administrator.
[55 FR 39974, Oct. 1, 1990]



503.104-12  Ethics program training requirements.

    (a) Except as provided in paragraph (b) of this section, the 
contracting officer is not responsible for ensuring that another 
agency's employee(s), who may function as a procurement official on 
behalf of that agency in interacting with GSA personnel, has executed 
the Procurement Official's Procurement Integrity Certification pursuant 
to FAR 3.104-12. Such interaction may occur in the requirements 
determination process and the development of specifications or 
statements of work.
    (b) Where a non-Government person or another agency's employee(s) 
act on behalf of GSA (e.g., serves on a Source Selection Board) the 
contracting officer is responsible for obtaining the Procurement 
Officials's Procurement Integrity Certification from non-GSA or non-
Government persons involved in

[[Page 301]]

the selection of a source in a GSA procurement.
[55 FR 39974, Oct. 1, 1990]



      Subpart 503.2--Contractor Gratuities to Government Personnel



503.203  Reporting suspected violations of the Gratuities clause.

    Employees shall immediately report any suspected violation of the 
Gratuities clause to the contracting officer, the Assistant Inspector 
General for Investigations or the Regional Inspector General for 
Investigations and to the Deputy Standards of Conduct Counselor in 
accordance with GSPMR 105-735.202(e)(4). The report must outline 
circumstances which indicate the Gratuities clause has been violated and 
include all pertinent documents. The Office of Inspector General will 
investigate and, if appropriate, forward a report and recommendation to 
the Department of Justice and/or the Office of Acquisition Policy, and/
or the Office of Ethics and Civil Rights.



503.204  Treatment of violations.

    (a) The Associate Administrator for Acquisition Policy or a designee 
shall make determinations under FAR 3.204.
    (b) The Associate Administrator or designee, after coordinating the 
matter with legal counsel, may initiate proceedings under FAR 3.204(a) 
by notifying the contractor that action against the contractor for a 
violation of the Gratuities clause is being considered. Notice must be 
provided by means of a letter sent by certified mail to the last known 
address of a party, its counsel, or agent for service of process. In the 
case of a business, notice may be sent to any partner, principal 
officer, director, owner or co-owner, or joint venture. If no return 
receipt is received within 10 calendar days of mailing, receipt will be 
presumed.
    (c) The contractor shall have 30 calendar days to exercise its 
rights under FAR 3.204(b), unless an extension is granted.
    (d) The Associate Administrator or designee may refer a matter to an 
agency fact-finding official designated by the Chairman of the GSA Board 
of Contract Appeals, if a determination is made that there are disputes 
of fact material to making a determination under FAR 3.204(a). Referrals 
for fact-finding will not be made in cases arising from a conviction or 
indictment as defined in FAR 9.403. If a referral is made, the fact-
finding official shall:
    (1) Afford the contractor the opportunity to dispute material facts 
relating to the determinations under FAR 3.204(a) (1) and (2).
    (2) Conduct the proceedings under rules that are consistent with FAR 
3.204(b).
    (3) Schedule a hearing within 20 calendar days of receipt of the 
referral. Extensions may be granted for good cause upon the request of 
the contractor or the agency.
    (4) Deliver written findings of fact to the Associate Administrator 
or designee (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.
    (e) The Associate Administrator or designee may reject the findings 
of the fact-finding official only if they are determined to be clearly 
erroneous or arbitrary and capricious.
    (f) In cases arising from conviction or indictment, or in which 
there are no disputes of material fact, the Associate Administrator or 
designee shall conduct the hearing required by FAR 3.204(b).
    (g) If it is determined that the Gratuities clause has been 
violated, the contractor may present evidence of mitigating factors to 
the Associate Administrator or designee, either orally or in writing, in 
accordance with a schedule established by the Associate Administrator or 
designee. The Associate Administrator or designee shall exercise the 
Government's rights under FAR 3.204(c) only after considering mitigating 
factors.



        Subpart 503.3--Reports of Suspected Antitrust Violations



503.303  Reporting suspected antitrust violations.

    Contracting officers shall report evidence of suspected antitrust 
violations

[[Page 302]]

in acquisitions to the Assistant Inspector General for Investigations or 
the Regional Inspector General for Investigations. The Office of 
Inspector General will investigate and prepare a report and 
recommendation to the Attorney General and to the Office of Acquisition 
Policy for suspension or debarment consideration.



                     Subpart 503.4--Contingent Fees



503.404  Solicitation provision and contract clause.

    (a) The contracting officer shall insert the provision at 552.203-4, 
Contingent Fee Representation and Agreement, in solicitations for the 
acquisition of leasehold interests in real property which exceed the 
simplified lease acquisition threshold.
    (b) The contracting officer shall insert the provision at 552.203-5, 
Covenant Against Contingent Fees, in solicitations and contracts for the 
acquisition of leasehold interests in real property.
[54 FR 26496, June 23, 1989, as amended at 57 FR 37889, Aug. 21, 1992; 
60 FR 42794, Aug. 17, 1995]



503.408  Evaluation of the SF 119.



503.408-1  Responsibilities.

    The contracting officer's documentation of the evaluation, 
conclusion and any proposed action must be reviewed by assigned legal 
counsel and the contracting director.



503.409  Misrepresentations or violations of the Covenant Against Contingent Fees.

    Employees who suspect or have evidence of violations of the Covenant 
Against Contingent Fees clause shall report the matter to the 
contracting officer as well as the Office of Inspector General. If 
appropriate, the Office of Inspector General will forward a report and 
recommendation to the Department of Justice.



            Subpart 503.5--Other Improper Business Practices



503.570  Advertising.



503.570-1  Policy.

    Contractors shall not refer to contracts awarded by GSA in 
commercial advertising in a manner which states or implies that the 
product or service provided is approved or endorsed by the Government or 
is considered by the Government to be superior to other products or 
services. This policy is intended to avoid the appearance of preference 
by the Government toward any product or service.



503.570-2  Contract clause.

    The contracting officer shall insert the clause at 552.203-70, 
Restriction on Advertising, in solicitations and contracts for supplies 
or services when the contract amount is expected to exceed the 
simplified acquisition threshold.
[54 FR 26496, June 23, 1989, as amended at 60 FR 42802, Aug. 17, 1995]



  Subpart 503.6--Contracts With Government Employees or Organizations 
                       Owned or Controlled by Them



503.602  Exceptions.

    (a) The heads of contracting activities may authorize exceptions to 
the policy in FAR 3.601.
    (b) Offers submitted by Government employees on solicitations issued 
under the Office of Management and Budget (OMB) Circular A-76 may be 
considered if the contracting officer complies with 503.603. When 
Government employees submit offers, they do so with the knowledge that 
if the contract is awarded, their Government employment will be 
terminated. The implementation of OMB Circular A-76 presents a unique 
situation which may be considered to be an exception to the policy in 
FAR 3.601. Contracts between the Government and its employees are not 
expressly prohibited except, where

[[Page 303]]

the employee acts for both the Government and the contractor in a 
particular transaction or where the service to be rendered is such as 
could be required of the contractor in his/her capacity as a Government 
employee.



503.603  Responsibilities of the contracting officer.

    Before awarding a contract to a GSA employee who responded to an A-
76 solicitation, the contracting officer shall:
    (a) Obtain a written certification from the employee's supervisor 
that: the individual was not involved in the development of the 
solicitation or specifications, or in the preparation of the independent 
Government cost estimate or in-house cost comparison; had no advance 
knowledge of the details of the contents of the solicitation package; 
and was not otherwise involved in the contracting process.
    (b) Refer the proposed award to assigned legal counsel for review 
and approval.
    (c) Ascertain whether a reduction-in-force notice has been issued to 
the employee.



             Subpart 503.7--Voiding and Rescinding Contracts



503.702  Definitions.

    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 will be presumed.
    Voiding and rescinding official means the Associate Administrator 
for Acquisition Policy or a designee.



503.705  Procedures.

    (a) Where a contract has been tainted by fraud, bribery, conflict of 
interest, or similar misconduct, the contracting officer should consult 
with counsel to determine if the Government has a common law remedy such 
as avoidance, rescision, or cancellation. Alternatively, the matter may 
be referred to the voiding and rescinding official under FAR 3.705, if 
there has been a final conviction for any violation of 18 U.S.C. 201-
224.
    (b) The contracting officer may postpone a decision to exercise the 
Government's common law right to void, rescind, or cancel a contract 
pending completion of legal proceedings against a contractor.
    (c) A referral to the voiding and rescinding official should 
identify the final conviction and include the information required by 
FAR 3.705(d) (2) through (5). The contracting officer should coordinate 
the referral with the Office of Inspector General to ascertain if a 
debarment referral is contemplated.
    (d) The voiding and rescinding official shall review the referral 
and coordinate the matter with assigned legal counsel and the 
contracting activity. If a determination is made to declare void and 
rescind a contract and to recover the amounts expended and the property 
transferred, the voiding and rescinding official shall issue the notice 
required by FAR 3.705, and conduct the hearing contemplated by FAR 
3.705(c)(3). If the voiding and rescinding official determines that 
there is a genuine dispute of material fact regarding the agency 
decision, the voiding and rescinding official shall refer the matter to 
the fact-finding official designated by the Chairman of the GSA Board of 
Contract Appeals. Such a referral will be made if there is a dispute of 
fact that relates to:
    (1) The contracts affected by the final conviction giving rise to 
the proposed action.
    (2) The amounts expended and property transferred by the Government 
under the contracts covered by the proposed action.
    (3) The identity and value of any tangible benefits received by the 
Government under the affected contracts.
    (e) If a referral for fact-finding is made, the fact-finding 
official shall:
    (1) Afford the contractor the opportunity to dispute material facts 
relating to 503.704(d) (1) through (3).
    (2) Conduct the proceedings under rules that are consistent with FAR 
3.705(c)(3).
    (3) Schedule a hearing within 20 calendar days of receipt of the 
referral.

[[Page 304]]

Extensions may be granted for good cause upon the request of the 
contractor or the agency.
    (4) Deliver 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.
    (f) The voiding and rescinding official shall not issue the agency's 
final decision under FAR 3.705(e) until receipt of the fact-finding 
official's report, if any. The voiding and rescinding official may 
reject the findings of the fact-finding official only if they are 
determined to be clearly erroneous or arbitrary and capricious.
    (g) In actions in which it is determined there are no material 
disputes of fact relating to the determinations required by FAR 3.705(d) 
(2), (4) and (5), the voiding and rescinding official will conduct the 
hearing contemplated by FAR 3.705(c)(3).
    (h) The final decision must be coordinated with the contracting 
activity and a copy of the decision provided to the activity.



   Subpart 503.8--Limitation on Payment of Funds To Influence Federal 
                              Transactions

    Source:  55 FR 29580, July 20, 1990, unless otherwise noted.



503.804  Policy.

    Contracting officers shall submit a copy of each disclosure form 
received in accordance with FAR 3.803 or 3.804 to the Office of GSA 
Acquisition Policy (VP) immediately upon receipt. The Office of GSA for 
Acquisition Policy will prepare the agency report to Congress in 
accordance with FAR 3.804(b).



503.806  Processing suspected violations.

    Contracting officers shall submit evidence of suspected violations 
of 31 U.S.C. 1352, Limitation on the Use of Appropriated Funds to 
Influence Certain Federal Contracting and Financial Transactions, to the 
Assistant Inspector General for Investigation or the Regional Inspector 
General for Investigation. The Office of Inspector General will 
investigate and, if appropriate, prepare a report and recommendation to 
the Department of Justice.



PART 504--ADMINISTRATIVE MATTERS--Table of Contents




                    Subpart 504.1--Contract Execution

Sec.
504.101  Contracting officer's signature.
504.103  Contract clause.

                  Subpart 504.2--Contract Distribution

504.201  Procedures.
504.203  Taxpayer identification number information.

   Subpart 504.4--Safeguarding Classified Information Within Industry

504.402  General.
504.470  Requests for release of classified information.
504.470-1  Authorization for release.
504.470-2  Termination of authorization for release.
504.471  Processing security requirements checklist (DD Form 254).
504.472  Periodic review.
504.473  Recurring procurement.
504.474  Control of classified information.
504.475  Return of classified information.
504.476  Breaches of security.

                      Subpart 504.8--Contract Files

504.800  Scope of subpart.
504.802  Contract files.
504.803  Contents of contract files.
504.804-5  Detailed procedures for closing out contract files.
504.805  Disposal of contract files.

  Subpart 504.9--Information Reporting to the Internal Revenue Service

504.903  Procedures.

      Subpart 504.70--Uniform Procurement Instrument Identification

504.7001  Uniform procurement instrument identification.
504.7001-1  Policy.
504.7001-2  Basic procurement instrument identification number.
504.7001-3  Order and call instrument identification number.
504.7001-4  Supplemental procurement instrument identification number.
504.7002  Procurement contract register.

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

[[Page 305]]


    Source:  54 FR 26498, June 23, 1989, unless otherwise noted.



                    Subpart 504.1--Contract Execution



504.101  Contracting officer's signature.

    Contracts and contract modifications must be signed personally and 
manually by the contracting officer. The

contracting officer's name and title must be typed or stamped below the 
signature. In the absence of the designated contracting officer, another 
contracting officer may sign documents. However, in all cases the name 
and title of the individual actually signing the document must be typed 
or stamped on the document below the signature.



504.103  Contract clause.

    Agency procedures do not require the use of the clause at FAR 
52.204-1, Approval of Contract, in solicitations and contracts.



                  Subpart 504.2--Contract Distribution



504.201  Procedures.

    (a) Contracting Officers are required to send documentation to the 
paying office on all contracts where a delivery order will be generated 
by GSA. The documentation shall consist of a ``Duplicate Original'' of 
the entire contract or modification, except as provided in paragraph 
(c), below.
    (b) The Contracting Officer shall certify that the ``Duplicate 
Original'' is a true copy of the contract or modification by means of a 
handwritten signature, in ink, on the award or modification form (i.e., 
SF 26, 33, 1442, etc.). The certification requirement does not apply to:
    (1) Leases of real property;
    (2) Schedule contracts; or
    (3) Standard or GSA multipage purchase/delivery order carbon forms.
    (c) For Federal Supply Service contracts entered into the FSS-19 
system and subject to the requirement in paragraph (a), above, 
distribution to the paying office shall be accomplished through the use 
of a system-generated contract listing.
[57 FR 61583, Dec. 28, 1992]



504.203  Taxpayer identification number information.

    The procedure outlined in FAR 4.203 for attaching the completed FAR 
provision at 52.204-3 as the last page of the contract sent to the 
paying office does not apply to leases of real property (see 504.903) or 
schedule contracts.
[55 FR 8954, Mar. 9, 1990]



   Subpart 504.4--Safeguarding Classified Information Within Industry



504.402  General.

    (a) This subpart prescribes procedures for safeguarding classified 
information required to be disclosed to contractors in connection with 
the solicitation of offers, and the award, performance, and termination 
of contracts. As used in this subpart, the term ``contractor(s)'' 
includes prospective contractors, subcontractors, vendors, and suppliers 
of any tier.
    (b) This subpart 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 will act for and on behalf of GSA in rendering 
security services required for safeguarding classified information 
released by GSA to United States (U.S.) industry.
    (c) As used in this subpart, the term ``U.S. industry'' pertains to 
those industries (including educational and research institutions) 
located within the United States, its possessions, and the Commonwealth 
of Puerto Rico.



504.470  Requests for release of classified information.

    Prior to soliciting offers or entering into discussions or 
negotiations with any contractor involving the disclosure of classified 
information, the contracting officer shall prepare, in triplicate, 
section I of GSA Form 1720, Request for Release of Classified 
Information to U.S. Industry (illustrated in subpart

[[Page 306]]

553.3). After signing as requesting officer and obtaining approval from 
the immediate supervisor, the contracting officer shall forward all 
copies of the completed form to the Personnel and Information Security 
Division (CES), Office of Management Controls and Evaluation.
[56 FR 47004, Sept. 17, 1991]



504.470-1  Authorization for release.

    CES, after determining that the contractor has been issued a 
Department of Defense facility security clearance, will complete the 
appropriate parts of section II, of GSA Form 1720, and return the 
original and one copy to the contracting officer. Under no circumstances 
will classified information be disclosed or made accessible to any 
contractor until the completed form has been received from CES. Where 
only Item 14b, section II, of the form has been checked, the contracting 
officer's actions will be governed by the instructions on the reverse 
side of the form. When a contractor is found to be ineligible for a 
security clearance, CES will advise the contracting officer.
[56 FR 47004, Sept. 17, 1991]



504.470-2  Termination of authorization for release.

    When circumstances support withdrawal or revocation of security 
clearance, CES will advise the contracting officer of the termination of 
authorization to release classified information and include instructions 
concerning actions required to safeguard, withhold, or obtain the return 
of classified information. Reasons for such termination may include:
    (a) Failure of the contractor to maintain the physical standards 
required by the ISM.
    (b) Information indicating the contractor no longer: (1) Is eligible 
for clearance or (2) requires access to classified information.
[56 FR 47004, Sept. 17, 1991]



504.471  Processing security requirements checklist (DD Form 254).

    (a) Contracts involving access to classified information by the 
contractor require preparation of DD Form 254, Contract Security 
Classification Specification (illustrated in FAR 53.303-DD-254), to 
identify and indicate to Department of Defense (DOD) and contractors the 
areas of classified information involved. In the case of contracts for 
research, advisory and assistance services, graphic arts services, or 
other procurements of services, written notice of classification may be 
used in lieu thereof.
    (b) Instructions or guidance on completing DD Form 254 may be 
obtained from CES.
[54 FR 26498, June 23, 1989, as amended at 56 FR 47005, Sept. 17, 1991]



504.472  Periodic review.

    Contracting officers shall review DD Form 254 whenever a change in 
the phase of performance occurs or at their own discretion, but in any 
event at least once a year, to determine whether the classified 
information can be downgraded or declassified. The contractor must be 
informed of the results of the review by issuance of a revised 
specification, or by written instructions instead of DD Form 254 (where 
authorized), or if the review results in no change in the classification 
specifications, by written notification to that effect. Upon termination 
or completion of the contract, a final checklist must be prepared.



504.473  Recurring procurement.

    When procurement is of a recurring nature, a new DD Form 254 is not 
required if the end item is not changed and there is no change from the 
previous security classification.



504.474  Control of classified information.

    (a) Classified information must be recorded, marked, handled, and 
transmitted in accordance with instructions contained in the handbook, 
Information Security (ADM P 1025.2C).
    (b) When classified information is originated by another agency, the 
consent of the originating agency must be obtained prior to releasing 
the classified information to the contractor.

[[Page 307]]



504.475  Return of classified informa-tion.

    (a) Unless the classified information has been destroyed as provided 
in paragraph 19 of the ISM, the contracting officer must recover the 
information. When classified information is furnished to a GSA 
contractor by another Government agency, the return of such information 
is the responsibility of that agency.
    (b) The contracting officer is responsible for insuring that 
classified information furnished to prospective offerors, offerors, or 
contractors is returned immediately:
    (1) After bid opening or closing date for receipt of proposals from 
non-responding offerors;
    (2) After contract award from 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 for safeguarding classified information, or (ii) has had its 
security clearance revoked or inactivated; or
    (6) Whenever otherwise instructed by the authority responsible for 
the security classification.



504.476  Breaches of security.

    When an unauthorized disclosure of classified information is 
discovered, the contracting officer or other GSA employee responsible 
for the information shall promptly refer the facts of such breach or 
compromise to CES.
[56 FR 47005, Sept. 17, 1991]



                      Subpart 504.8--Contract Files



504.800  Scope of subpart.

    This subpart prescribes requirements for using standard contract 
file format for all contracts, except leases of real property, that 
exceed the simplified purchase acquisition. The application of this 
subpart to purchases made using simplified acquisition procedures is 
optional.
[54 FR 26498, June 23, 1989, as amended at 60 FR 42802, Aug. 17, 1995]



504.802  Contract files.

    (a) Standardization of files. Contract files must contain all 
necessary information and documentation required by FAR 4.802 and 4.803 
and be organized in the standardized contract file format in 504.803.
    (b) Responsibility for contract files. The contracting officer is 
responsible for the official file. All documents pertaining to the 
contract must be forwarded by those initiating them to the contracting 
officer for inclusion in this file. The contracting officer is also 
responsible for the accountability of contract files transferred to the 
records center and for knowing the location of the files as provided by 
the National Archives and Records Administration.
    (c) Transfer of responsibility for contract files. (1) When 
responsibility for a contract is transferred from one contracting 
officer to another, e.g., transfer of assignments or redelegation of 
contract administration (intraoffice or interoffice), the contracting 
officer transferring the files shall prepare a detailed listing by file 
number and/or name to identify the file(s) to be transferred (see also 
FAR 42.206).
    (2) If available, duplicates of the files to be transferred must be 
retained by the contracting officer until acknowledgement of receipt of 
the transferred files by the contracting officer is received.
    (3) The original contracting officer transferring the files shall 
retain one copy of the listing and send a copy of the listing to the 
successor contracting officer under a separate mailing as advance notice 
of the files to be transferred.
    (4) The files to be transferred to the successor contracting officer 
must be sent by certified mail, return receipt requested, when 
appropriate, or by another method so as to obtain a signature of the 
successor contracting officer for receipt of the contract files that are 
transferred. The transferred files must be accompanied by two copies of 
the listing to the successor contracting officer.
    (5) The successor contracting officer, who becomes responsible for 
the files, shall sign one copy of the listing, certifying receipt of the 
files listed, and

[[Page 308]]

return the signed copy to the contracting officer transmitting the 
files.



504.803  Contents of contract files.

    (a) The contract file must be numerically tabbed, filed in reverse 
order starting with item (1) on the bottom of the file and item (27) on 
the top. Documents within the tab should be filed chronologically with 
the most recent document on top. If any of the documents are too 
voluminous to be placed under the applicable tab, they should be 
included in a separate file and the tab annotated with the location of 
the file. All of the items described will not always be needed for each 
contract action. If a tab is not required for a particular action, it 
should be omitted from that contract file. The file must be tabbed as 
specified below:
    (1) Requisition or request for contractual action. Where technical 
or requirements personnel recommend the use of other than full and open 
competition, the certification of the accuracy and completeness of the 
data to support the recommendation should be filed under this tab. (See 
FAR 6.303-1(b).)
    (2) Specifications, drawings, and other technical documents.
    (3) Acquisition plan including, where applicable, the determination 
required by OMB Circular A-76 and/or concurrence of the cognizant 
competition advocate.
    (4) Determination and findings required by FAR Subpart 1.7 and 
Subpart 501.7, or justification required by FAR 6.303, including the 
certification of accuracy and completeness of the justification.
    (5) Department of Labor Wage Determination.
    (6) Small business and labor surplus area determinations.
    (7) Source list.
    (8) Statement as to synopsis of proposed procurement under FAR 
Subpart 5.2 or other required advertisements.
    (9) Presolicitation notice.
    (10) IFB/RFP and amendments.
    (11) Abstract of bids/proposals including identification of the low 
bidder/offeror, discounted price, etc.
    (12) Cost or pricing data and information other than cost or pricing 
data. Where the requirement for submission of cost or pricing data is 
waived, as provided in FAR 15.804-1(b)(5), the waiver and documentation 
supporting the waiver should be filed under this tab.
    (13) Field pricing report (see FAR 15.805-5 and 515.805-5). Where 
the requirement for a field pricing report of a price proposal is 
waived, as provided in FAR 15.805-5, the waiver and documentation 
supporting the waiver should be filed under this tab.
    (14) Price or cost analysis report prepared under FAR 15.608. 
Supporting technical analyses, other than those supporting an audit 
report, should be filed under this tab. The profit or fee analysis 
required by FAR Subpart 15.9 should be made a part of the price or cost 
analysis report. In those cases where an independent Government estimate 
is prepared, it should also be made a part of the price or cost analysis 
report.
    (15) A price negotiation memorandum, as required by FAR 15.808, must 
be written so as to permit reconstruction of all the major events of the 
acquisition and placed under this tab.
    (16) Certificate of current cost or pricing data.
    (17) Pre-award survey.
    (18) EEO compliance review.
    (19) ``No bid'' or ``no proposal'' correspondence.
    (20) Unsuccessful bids or proposals. A copy of each rejected bid or 
unacceptable proposal also must be included in the file under this tab.
    (21) Mistakes in bids and protests. This includes all correspondence 
and determinations relating to mistakes in bids disclosed before award 
and/or protests.
    (22) Actions taken on late bids or proposals.
    (23) Contractual action. Successful bid or proposal and all 
pertinent correspondence applicable to the contractual action including 
evidence of submission of contract award data to paying office, if 
applicable (see 504.201). Subcontracting plans that are incorporated in 
and made a material part of a contract, as required by FAR 19.705-
5(a)(5), and the successful competing contractor's certificate of 
procurement integrity required by FAR 3.104-9(b), should be filed under 
this tab.

[[Page 309]]

    (24) Evidence of concurrence for legal sufficiency of the 
appropriate counsel (if applicable).
    (25) Any required approvals--GSA 1535, Recommendation for Award, or 
documentation of approval of Subcontracting Plan (as applicable). The 
contracting officer's and any other departing procurement official's 
certificate of procurement integrity, required by FAR 3.104-7(a) and 48 
CFR 503.104-7 and the record of individuals authorized access to 
proprietary or source selection information, required by FAR 3.104-
5(d)(2) and 3.104-9(e)(iii) should be filed under this tab.
    (26) Any notices of award including Standard Form 99, Notice of 
Award of Contract (if applicable).
    (27) SF 279, FPDS Individual Contract Action Report.
    (b) An index of the file tabs should be placed in the file. Items 
which do not apply should be so marked, and if necessary, a brief 
explanation included. The GSA Form 3420, Contract/Modification File 
Checklist, illustrated in 553.370-3420, must be used by the contracting 
officers in the Public Buildings Service. The form may be used by other 
offices or a standard contract file checklist, based on the requirements 
of 504.803(a), appropriate to that particular office may be prepared. 
The requirements of a particular office may provide for the inclusion of 
subheadings under a tab or additional items as appropriate.
[54 FR 26498, June 23, 1989, as amended at 54 FR 40060, Sept. 29, 1989; 
55 FR 39974, Oct. 1, 1990; 57 FR 61584, Dec. 28, 1992; 61 FR 6165, Feb. 
16, 1996; 61 FR 14033, Mar. 29, 1996]



504.804-5  Detailed procedures for closing out contract files.

    When the statement required by FAR 4.804-5(b) is completed, the 
administrative contracting officer (ACO) shall forward the statement and 
the contract files to the cognizant procuring contracting officer (PCO). 
The ACO shall follow the procedures outlined in 504.802(c) when 
transferring the files to the PCO.



504.805  Disposal of contract files.

    The contracting officer's accountability for contract files 
terminates at the end of their retention period when the notice of 
disposal is received from the National Archives and Records 
Administration, and disposal is approved by the appropriate records 
liaison officer whose organization has functional responsibility for the 
files.



  Subpart 504.9--Information Reporting to the Internal Revenue Service



504.903  Procedures.

    (a) The Office of Finance makes reports required by 26 U.S.C. 6041 
and 6041A as implemented in 26 CFR to the IRS on payments made to 
certain contractors for services performed and to lessors for providing 
space in buildings. In order for Finance to make the required reports, 
contracting officers must indicate on obligating documents (e.g. 
purchase/delivery orders, contracts, or the GSA Form R-620 for leases) 
forwarded to Finance, the contractor's organization structure (e.g. 
corporation, partnerships, etc.) and for contractors that are not 
incorporated (except as provided in FAR 4.902(a)(1)(i)), the 
contractor's taxpayer identification number (TIN). When certified 
invoice procedures (see 513.70) are used, contracting officers must 
identify the organization structure for Finance.
    (b) Reports required by 26 U.S.C. 6050M are made through the Federal 
Procurement Data System.



      Subpart 504.70--Uniform Procurement Instrument Identification



504.7001  Uniform procurement instrument identification.

    Except for real property leasing activities and procurement 
activities of the Federal Supply Service, the procedures in this subpart 
prescribed for the identification of contracts, orders, and other 
procurement instruments regardless of dollar threshold are applicable 
for all other contracting activities, including the Federal Supply 
Service, Property Management Division.



504.7001-1  Policy.

    (a) The uniform procurement instrument identification system must be 
used for procurement instruments listed in paragraph (f) of 504.7001-2. 
The

[[Page 310]]

system does not apply to purchases made through certified invoice 
procedures (see 513.70) or to imprest fund purchases.
    (b) Identification should be placed in the contract number block 
provided on the applicable forms. If a space is not reserved for the 
prescribed number, it should be placed in the upper right-hand corner of 
the form.
    (c) Each contracting office shall maintain records to ensure 
continuity and control of procurement instrument identification numbers. 
(See 504.7002.)



504.7001-2  Basic procurement instrument identification number.

    The basic procurement instrument identification number will normally 
be assigned at the time of award. However, the number may be assigned at 
the time a procurement request is received if assignment at that time 
will facilitate tracking of the procurement. The basic procurement 
instrument identification number does not change during the life of the 
particular instrument and consists of 14 alphanumeric characters as 
follows:
    (a) Characters 1 and 2 of the basic procurement instrument 
identification number is the symbol ``GS.''
    (b) The third and fourth characters reflect the region preparing the 
instrument as follows:

00  Central Office
01  Region 1
02  Region 2
03  Region 3
04  Region 4
05  Region 5
06  Region 6
07  Region 7
08  Region 8
09  Region 9
10  Region 10
11  National Capital Region

    (c) The fifth character is a capital letter assigned to the service/
office preparing the instrument as follows:

B  Office of the Chief Financial Officer
F  Federal Supply Service
G  GSA Board of Contract Appeals
C  Office of Management and Human Resources
J  Office of Inspector General
K  Information Technology Service
L  Office of General Counsel
P  Public Buildings Service
T  Federal Telecommunications Service

    (d) The sixth and seventh characters identify the fiscal year in 
which the number is assigned.
    (e) The eighth and ninth characters identify the contracting office 
preparing the instrument. (These codes will be assigned to each GSA 
organization where a contracting officer is assigned.) See appendix A 
for code assignment.
    (f) The tenth character is a capital letter assigned to indicate the 
type of procurement instrument code as follows:

A  Agreements, including basic agreements, basic ordering agreements, 
and blanket purchase agreements.
B  Reserved
C  Contracts, including letter contracts, contracts referencing basic 
agreements, or basic ordering agreements, excluding indefinite delivery 
type contracts.
D  Indefinite delivery contracts, including definite quantity, 
requirements contracts and indefinite quantity contracts.
E  Sales contracts.
F-L  Reserved
M  Purchase orders (open market simplified acquisition)--manual
N  Reserved
P  Purchase orders--(open market simplified acquisition)--automated.
Q  Reserved
R  Reserved
S  Schedule contract
T-Z  Reserved

    (g) The eleventh through fourteenth characters reflect the serial 
number of the instrument. A separate series of numbers, maintained at 
the contracting office level, may be used for each type of instrument 
listed in paragraph (f) of 504.7001-2, depending upon procurement 
document volume. At the beginning of each fiscal year, these serial 
numbers will begin with the number 0001. Alphanumeric characters will be 
serially assigned, after all the numeric series are exhausted, i.e., 
0001 through 9999, with an alpha as the first character, followed by 
three character numeric serial number. Each issuing office is 
responsible for controlling the serial number assignments. The following 
numeric and alphanumeric sequences, excluding alpha I and O, will be 
used:

0001 through 9999;
A001 through A999, B001 through B999; and so on to Z001 through Z999.


[[Page 311]]


    (h) An example of this procurement instrument identification number 
is:
[GRAPHIC] [TIFF OMITTED] TC01MR91.126

[54 FR 26498, June 23, 1989, as amended at 60 FR 54955, Oct. 27, 1995]



504.7001-3  Order and call instrument identification number.

    Delivery orders under indefinite delivery contracts (orders), and 
orders under schedule contracts must be identified by an ``11'' 
character alphanumeric identification number placed in the order number 
block of the order form. The basic indefinite delivery or schedule 
contract number must be placed in the contract number block of the order 
form.
    (a) The first character is a capital letter assigned to the office 
issuing the order. This code will be identical to those assigned in 
paragraph (c) of 504.7001-2.
    (b) The second and third characters reflect the Region issuing the 
order. These identification codes will be identical to the codes 
assigned in paragraph (b) of 504.7001-2.
    (c) The fourth and fifth characters identify the fiscal year in 
which the number is assigned.
    (d) The sixth and seventh characters identify the contracting office 
preparing the order. These identification codes will be the same as the 
codes assigned in paragraph (e) of 504.7001-2.
    (e) The eighth through the eleventh characters reflect the serial 
number of the order. Each contracting office maintains its own serial 
number. Alphanumeric numbers are used when more than 9999 numbers are 
required. Alphanumeric numbers are serially assigned with an alpha in 
the first position followed by the numeric serial number. The following 
sequences, excluding alpha I and O will be used:

0001 through 9999;
A001 through A999; and so on to Z001 through Z999.

    (f) An example of a delivery order number is:

[[Page 312]]

[GRAPHIC] [TIFF OMITTED] TC01MR91.127



504.7001-4  Supplemental procurement instrument identification number.

    Modifications to the basic contract instrument and to call/order 
against contracts are numbered by use of a four character alphanumeric 
number. The supplemental identification numbering system applies to all 
modifications to contracts and to call/orders against contracts.
    (a) The first character is a capital letter identifying the office 
issuing the modification, as indicated below:

A  Contract administration office modification (Administrative 
Components); or
P  Purchasing office modification.

    (b) The second character is a capital letter identifying the type of 
action, as follows:

A  Administrative change.
C  Change order.
O  Other (includes exercise of options, price adjustments under 
escalation clauses and other changes made under specific contract 
clauses.)
S  Supplemental agreement (bilateral signatures).

    (c) The third and fourth characters reflect the serial number. 
Alphanumeric numbers are used when more than 99 numbers are required. 
Alphanumeric numbers are serially assigned with an alpha in the first 
position followed by a numeric number. If additional numbers are needed, 
alphas may be used in both positions. The following sequences, excluding 
alpha I and O, will be used:

    01 through 99.
    A1 through A9, and so on to Z1 through Z9.
    AA through AZ, and so on to ZA through ZZ.

    (d) An example of the supplemental procurement instrument 
identification number is:
[GRAPHIC] [TIFF OMITTED] TC01MR91.128


[[Page 313]]





504.7002  Procurement contract register.

    GSA Form 2728, Procurement Contract Register, or an automated 
register must be used to ensure continuity and control of procurement 
instrument identification numbers.

[[Page 314]]


[[Page 314]]





           SUBCHAPTER B--COMPETITION AND ACQUISITION PLANNING





PART 505--PUBLICIZING CONTRACT ACTIONS--Table of Contents




               Subpart 505.1--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.
505.204  Presolicitation notices.
505.204-70  Presolicitation notices used in connection with market 
          searches for competitive sources.
505.207  Preparation and transmittal of synopses.
505.270  Synopsis of amendments to solicitations.

               Subpart  505.3--Synopses of Contract Awards

505.303  Announcement of contract awards.
505.303-70  Notification of proposed substantial awards and awards 
          involving Congressional interest.

                  Subpart 505.4--Release of Information

505.403  Requests from Members of Congress.

                   Subpart 505.5--Paid Advertisements

505.502  Authority.
505.503  Procedures.
505.504  Use of advertising agencies.

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

    Source:  54 FR 26502, June 23, 1989, unless otherwise noted.



               Subpart 505.1--Dissemination of Information



505.101  Methods of disseminating information.

    (a) Contracting offices located in the same geographic area as the 
Business Service Center (BSC) may post the notice required by FAR 
5.101(a)(2) at the BSC.
    (b) The appropriate BSC must be furnished a copy of solicitations 
(except solicitations for space in buildings) when the estimated 
contract amount is expected to exceed the simplified acquisition 
threshold. The BSC will display the solicitation for public examination.
    (c) Unless exempt under FAR 5.202 or 505.202, proposed acquisitions 
must be publicized in local newspapers and may also be posted on on-line 
information systems, when the acquisition is for:
    (1) Real property appraisal services, estimated to cost $10,000 or 
more; or
    (2) Leasehold interests in real property involving blocks of space 
of both more than 10,000 square feet and terms which exceed 6 months. 
Proposed leases of 10,000 square feet or less or for terms of 6 months 
or less may be publicized when the contracting officer determines such 
advertising will serve to promote competition.
[54 FR 26502, June 23, 1989, as amended at 57 FR 37889, Aug. 21, 1992; 
60 FR 42794, 42802, Aug. 17, 1995]



          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) Advertising in local newspapers, and optional posting on on-line 
information systems, are more appropriate than synopsizing in the 
Commerce Business Daily (CBD) for proposed acquisitions of--
    (1) Leasehold interests in real property (except lease construction 
on a designated site);
    (2) Real property appraisal services (see 505.101); and
    (b) It is not appropriate or reasonable to publish an advance notice 
of:
    (1) Acquisitions of works of art, including the design, execution 
and installation of the artwork, under the Art-in-Architecture Program; 
and
    (2) Supplemental agreements to leases of real property involving:

[[Page 315]]

    (i) Building alterations (see 570.6);
    (ii) Lease extensions (see 570.505); or
    (iii) Expansion requests (see 570.503).
[54 FR 26502, June 23, 1989, as amended at 60 FR 42794, Aug. 17, 1995]



505.203  Publicizing and response time.

    (a) When publicizing acquisitions of real property appraisal 
services and leasehold interests in real property is required (see 
505.101 and 505.202), the notice must appear in local newspapers at 
least 3 calendar days before issuance of the solicitation. The 
solicitation must be issued at least:
    (1) 10 calendar days before the date established for receipt of 
initial offers for real property appraisal services; or
    (2) 20 calendar days before the date established for receipt of 
initial offers for leasehold interests in real property, unless the 
contracting officer makes a written determination that the urgency of 
the need necessitates a shorter time period.
    (b) The publicizing and response times in paragraph (a) do not apply 
to proposed acquisitions of leasehold interests in real property being 
conducted using simplified lease acquisition procedures (see 570.2). In 
such cases, the contracting officer may establish response times 
appropriate for the individual acquisition involved.
[54 FR 26502, June 23, 1989, as amended at 60 FR 42794, Aug. 17, 1995]



505.204  Presolicitation notices.



505.204-70  Presolicitation notices used in connection with market searches for competitive sources.

    (a) The term ``sources-sought synopsis'' means the type of Commerce 
Business Daily (CBD) notice designed to identify potential sources for 
procurements. The sources-sought synopsis provides an opportunity for 
the marketplace to indicate its interest in submitting offers for future 
acquisitions. It is normally used to discover if more than one firm is 
interested and qualified to provide a particular product or service, 
although a solicitation is not yet available. This type of synopsis has 
particular application when one contractor is thought to be uniquely 
capable of meeting the Government's minimum requirements and 
verification of this opinion is needed.
    (b) Sources-sought notices publicizing the Government's interest in 
anticipated supply or service procurements may be published in the CBD, 
using the general format outlined in 505.207, except where security 
considerations prohibit such publication. A sources-sought synopsis may 
be published in connection with market searches for sources of supply or 
services, other than those discussed in FAR 5.205, when a sources-sought 
synopsis is required to test the marketplace for competitive sources. In 
conjunction with that solicitation, the specific procurement of the 
supply or service must be publicized in the CBD as required by FAR 
5.201, unless the contract action will be made through interim or full 
FACNET.
[54 FR 26502, June 23, 1989, as amended at 60 FR 42802, Aug. 17, 1995]



505.207  Preparation and transmittal of synopses.

    Notices described in 505.204-70 must include a statement similar to 
the following (modifications may be made to suit needs):

    Concerns having the ability to furnish the following supplies 
(services) are requested to give written notification (including the 
telephone number for a point of contact) to the acquiring office listed 
in this notice within ________ calendar days (no less than 30 days 
should be entered) from the date of this synopsis:
    (The contracting officer should describe the requirement so as to 
furnish a complete supply (service) description, and a condensation of 
other essential information, to provide concerns with an intelligible 
basis for judging whether they have an interest in the procurement. Such 
information may include a statement regarding the Government's belief 
that the supply or service may be available only from a sole source and 
the reasons for such belief.)
    This is not a formal solicitation. However, concerns that respond 
should furnish detailed data concerning their capabilities and may 
request a copy of the solicitation when it becomes available.



505.270  Synopsis of amendments to solicitations.

    All amendments to solicitations for offers increasing the 
anticipated value of the proposed acquisition above the

[[Page 316]]

dollar threshold requiring synopsis or altering the scope of the 
proposed acquisition so that increased interest of contractors can be 
reasonably anticipated must be published in the Commerce Business Daily.



               Subpart 505.3--Synopses of Contract Awards



505.303  Announcement of contract awards.

    By complying with 505.303-70 contracting officers automatically 
fulfill the reporting requirements of FAR 5.303(a).



505.303-70  Notification of proposed substantial awards and awards involving Congressional interest.

    (a) Applicability. The notification procedures in (b), below, apply 
only to proposed award involving:
    (1) A contract with the Small Business Administration (the 8(a) 
program) exceeding or estimated to exceed $100,000.
    (2) A supply contract exceeding or estimated to exceed $500,000 
(except for (i) motor vehicles, (ii) products whose points of origin are 
not readily identifiable, or (iii) products involving foreign production 
points).
    (3) A design (Architect/Engineer) contract or construction contract 
exceeding or estimated to exceed $500,000.
    (4) Any other contract, or class of contract, in excess of $100,000 
for which a Member of Congress has specifically requested notification 
of award.
    (b) Notification procedures. (1) The Office of Congressional and 
Intergovernmental Affairs (S) will notify the heads of contracting 
activities in writing with the names of Members of Congress who wish to 
be notified of any or all contract awards in excess of $100,000 to 
contractors located within their district or State, as applicable. Upon 
such notification, the contracting activities will provide, via 
electronic mail, facsimile or hand delivery applicable notices of award 
to S. A copy of the submittal should be provided to the regional 
congressional liaison office.
    (2) Except for submittals hand delivered to S, the submittal must be 
made by electronic mail or facsimile transmission. Except for contracts 
awarded under urgent and compelling circumstances, notification to S of 
an award must be made on the same day that the award is made and 24 
hours before telephonic notice (if applicable) is provided to the 
contractor. If the timeframe for notification to S cannot be met, the 
Contracting Director must notify S by telephone.
    (3) The notification to S must:
    (i) Describe the supplies or services acquired and the duration of 
the contract period.
    (ii) Identify the type of contract and contractor using the 
following codes:
    (A) DO for definite quantity contract.
    (B) SC for schedule contract.
    (C) TC for indefinite delivery contract other than schedule.
    (D) S for small business concern.
    (E) SD for small disadvantaged business concern.
    (F) WO for women-owned small business concern.
    (G) O for other than a small business concern.
    (iii) Include the contractor's name and address (including county 
and Congressional district, if known) and indicate the dollar value of 
the contract for each production point. When there are multiple 
production points and specific items, and their points of production are 
not shown, or when the number of production points exceed 10, write 
``multiple'' and indicate immediately after, in parentheses, the total 
number of production points.
    (iv) Indicate the quantity and unit, in parentheses, for definite 
quantity awards by production point. Indicate the name of the receiving 
agency next to the applicable quantity and identify the requirement or 
portion thereof for overseas use.
    (v) Provide the name (where available) and telephone number for a 
point-of-contact for each award recipient and each production point.
    (vi) Include the following statement when Congressional interest is 
involved.

``Congressional Interest: (Name of Congressman/Senator)
  (Indicate State/District)
  (Describe interest)''


[[Page 317]]


    (vii) Provide the contracting officer's name and telephone number 
for each award.
    (4) The notification to S will contain sensitive preaward 
information and should be labeled accordingly. S and regional 
Congressional liaison offices will be responsible for the security of 
such information and will establish procedures governing the release of 
such information before official notification of award. Unless otherwise 
authorized by the contracting officer, the release of such information 
prior to award shall be limited to Members of Congress and their staff.
    (c) Release of awards. (1) Release of notifications which require 
priority processing as determined by the Associate Administrator for 
Congressional Affairs will be accomplished at the time and date 
specified.
    (2) Unless notified to the contrary, contracting activities may 
release awards of the type described in (a) and (b) of this section, or 
information pertinent thereto, upon the expiration of two full workdays 
(48 hours) after the time and date of notification to S established 
either by the facsimile transmission or hand delivery.
[54 FR 26503, June 23, 1989, as amended at 54 FR 29722, July 14, 1989; 
54 FR 40060, Sept. 29, 1989; 55 FR 39974, Oct. 1, 1990; 60 FR 42802, 
Aug. 17, 1995; 61 FR 1150, Jan. 17, 1996]



                  Subpart 505.4--Release of Information



505.403  Requests from Members of Congress.

    When responding to a Congressional inquiry would result in 
disclosure of classified material, confidential business information, 
proprietary or source selection information as defined in FAR 3.104-4 or 
information prejudicial to a competitive acquisition, the contracting 
officials shall consult with assigned legal counsel, refer the proposed 
reply to the head of the contracting activity (HCA), include the caution 
notice prescribed in 503.104-5(d)(6) in the response, and inform the 
Office of Congressional Affairs of the action taken.
[55 FR 39974, Oct. 1, 1990]



                   Subpart 505.5--Paid Advertisements



505.502  Authority.

    (a) Newspapers. Written approval from the HCA or a designee is 
required for paid newspaper advertisements, except when such publication 
is required by the FAR or the GSAR (see 505.101(c)). The contracting 
officer shall 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 place paid 
advertisements in media other than newspapers.



505.503  Procedures.

    The GSA Form 300, Order for Supplies or Services, must be used 
instead of the Optional Form 347, Order for Supplies and Services, when 
the dollar amount of the acquisition does not exceed the simplified 
acquisition threshold or when issuing a delivery order under a basic 
ordering agreement with an advertising agency for an advertisement.
[54 FR 26502, June 23, 1989, as amended at 60 FR 42802, Aug. 17, 1995]



505.504  Use of advertising agencies.

    The services of commercial advertising agencies may be used whenever 
it is determined that the services rendered by those agencies can 
increase competition for contracts and improve the effectiveness of GSA 
advertising and marketing programs.



PART 506--COMPETITION REQUIREMENTS--Table of Contents




   Subpart 506.2--Full and Open Competition after Exclusion of Sources

Sec.
506.202  Establishing or maintaining alternative sources.

           Subpart 506.3--Other Than Full and Open Competition

506.302  Circumstances permitting other than full and open competition.
506.302-1  Only one responsible source and no other supplies or services 
          will satisfy agency requirements.
506.303  Justifications.

[[Page 318]]

506.303-1  Requirements.

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

    Source:  54 FR 26504, June 23, 1989, unless otherwise noted.



   Subpart 506.2--Full and Open Competition After Exclusion of Sources



506.202  Establishing or maintaining alternative sources.

    The heads of contracting activities (HCA's) sign determinations and 
findings under FAR 6.202.



           Subpart 506.3--Other than Full and Open Competition



506.302  Circumstances permitting other than full and open competition.



506.302-1  Only one responsible source and no other supplies or services will satisfy agency requirements.

    A class justification has been established for the acquisition of 
utility services (except electric utility services) that are available 
from only one source. A copy of the class justification may be obtained 
from the GSA Acquisition Policy Division (MVP). The contract file for 
each action taken under the justification must contain a signed 
statement by the contracting officer that the action taken is within the 
scope of the class justification and approval.
[55 FR 48847, Nov. 23, 1990, as amended at 61 FR 39088, July 26, 1996]



506.303  Justifications.



506.303-1  Requirements.

    The contracting officer should determine whether the facts 
supporting other than full and open competition would be present in 
other GSA contracting activities. If the facts would be present, the 
contracting officer should recommend through appropriate channels that 
the Deputy Associate Administrator for Acquisition Policy approve a 
class justification for use by all GSA contracting activities.
[54 FR 26504, June 23, 1989, as amended at 61 FR 39088, July 26, 1996]



PART 507--ACQUISITION PLANNING--Table of Contents




                    Subpart 507.1--Acquisition Plans

Sec.
507.101  Definitions.
507.102  Policy.
507.103  Agency head responsibilities.
507.104  General procedures.
507.105  Contents of written acquisition plans.

         Subpart 507.3--Contractor Versus Government Performance

507.307  Appeals.

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

    Source:  54 FR 26504, June 23, 1989, unless otherwise noted.



                    Subpart 507.1--Acquisition Plans



507.101  Definitions.

    Comprehensive acquisition plan means a plan which covers the 
acquisition process from identification of agency need through contract 
performance and administration.
    Limited acquisition plan means a detailed plan which covers the 
acquisition process from receipt of a purchase request or advanced 
notice of the need by the contracting office through contract award.



507.102  Policy.

    (a) All acquisitions exceeding the simplified acquisition threshold 
must have a limited acquisition plan unless a comprehensive acquisition 
plan is required under GSA Order, Comprehensive Acquisition Planning 
(APD 2800.13A). Priced options must be included when determining the 
dollar threshold. An acquisition plan must be prepared before exercise 
of unpriced and/or unevaluated options exceeding the simplified 
acquisition threshold.
    (b) No solicitation may be issued until either a comprehensive 
acquisition plan or a limited acquisition plan has been prepared or the 
requirement waived under GSA Order APD 2800.13A or 507.104(d). A 
contract may not be entered into without full and open competition on 
the basis of a lack of acquisition planning or concerns related to

[[Page 319]]

the amount of funds available to the acquisition.
[55 FR 28631, July 12, 1990, as amended at 60 FR 42802, Aug. 17, 1995]



507.103  Agency head responsibilities.

    The head of the contracting activity (HCA) shall ensure that, during 
the acquisition planning phase, requirements personnel consider the use 
of the metric system of measurement consistent with 15 U.S.C. 205 et 
seq. (See 48 CFR 511.002), GSA Order, GSA Metric Program (ADM 8000.1A) 
and GSA Metric Transition Plan. Use of the metric system must be 
coordinated with the contracting officer and be consistent with 
security, operational, economic, technical, logistical, training, and 
safety requirements.
[56 FR 2864, Jan. 25, 1991, as amended at 61 FR 6165, Feb. 16, 1996]



507.104  General procedures.

    (a) Policies and procedures for comprehensive acquisition plans are 
in GSA Order, Comprehensive Acquisition Planning (APD 2800.13A).
    (b) The contracting officer shall be responsible for preparing a 
limited acquisition plan. Limited plans must be reviewed and approved at 
least one level above the individual writing the plan unless the 
requirement is received in the last month of the fiscal year and award 
is anticipated during the same month. In those cases, the plan must be 
reviewed and approved at a level no lower than the contracting director. 
The head of the contracting activity (HCA) may require review and 
approval at a higher level.
    (c) Limited plans must be in writing, unless waived under paragraph 
(d) of this section.
    (d) The contracting director may waive the requirement for a written 
limited acquisition plan (1) for recurring annual acquisitions or (2) in 
cases of unusual or compelling urgency. The individual responsible for 
preparing the plan shall present (as a minimum) an oral plan to at least 
the next higher level for approval. The file must summarize the content 
of the oral plan and the name of the individual that approved it. In 
cases of unusual or compelling urgency, the summary must also indicate 
the nature of the urgency and may be prepared after award when 
preparation before award would unreasonably delay the acquisition. The 
summary may be included in the justification required by FAR 6.302-2(c).
    (e) Acquisition plans for contracts which propose using other than 
full and open competition must be coordinated with and concurred in by 
the cognizant competition advocate unless the proposed contract will be 
awarded under the authority at FAR 6.302-5 or will be awarded under a 
class justification approved by the Associate Administrator for 
Acquisition Policy.
[54 FR 26504, June 23, 1989, as amended at 55 FR 28631, July 12, 1990; 
60 FR 42802, Aug. 17, 1995; 61 FR 54955, Oct. 27, 1995]



507.105  Contents of written acquisition plans.

    (a) The specific content of a plan will vary depending on the nature 
of the acquisition and the dollar value involved. HCA's may authorize:
    (1) Development of standard plan outlines meeting the needs of 
individual programs;
    (2) Substitution of automated plans which adequately address 
individual elements;
    (3) Modification of the suggested information for limited 
acquisition plans by deleting inapplicable elements or adding new ones 
as needed.
    (b) The outline in FAR 7.105 must be used as the basis for 
comprehensive acquisition plans required under GSA Order APD 2800.13A. 
If an element does not apply, it must be so annotated. Elements may be 
added to the outline as appropriate. It is suggested that a limited 
acquisition plan include the information cited below.
[54 FR 26504, June 23, 1989, as amended at 55 FR 28631, July 12, 1990]



         Subpart 507.3--Contractor Versus Government Performance



507.307  Appeals.

    Appeal procedures are in GSA Order, Implementation of the OMB 
Circular A-76 Productivity Improvement Program (ADM P. 5400.40).

[[Page 320]]



PART 508--REQUIRED SOURCES OF SUPPLIES AND SERVICES--Table of Contents




                        Subpart 508.3  [Reserved]

     Subpart 508.6--Acquisition From Federal Prison Industries, Inc.

Sec.
508.604  Ordering procedures.
508.604-70  Delinquent delivery orders.
508.605  Clearances.

Subpart 508.7--Acquisition From Nonprofit Agencies Employing People Who 
                     Are Blind or Severely Disabled

508.705-70  Adding items to the Procurement List.
508.705-71  Workshop performance capability.
508.705-74  Compliance with orders.
508.706  Purchase exceptions.

       Subpart 508.8--Acquisition of Printing and Related Supplies

508.802  Policy.

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

    Source:  54 FR 26505, June 23, 1989, unless otherwise noted.



                        Subpart 508.3  [Reserved]



     Subpart 508.6--Acquisition From Federal Prison Industries, Inc.



508.604  Ordering procedures.



508.604-70  Delinquent delivery orders.

    (a) Contracting officers shall establish delivery schedules based on 
the lead time required by Federal Prison Industries (FPI). Modifications 
of orders to extend the delivery schedules for excusable or inexcusable 
delays will not provide for a price adjustment.
    (b) Delinquent orders may indicate the need to request clearance to 
procure from other sources until FPI can make deliveries on time.



508.605  Clearances.

    FPI clearance numbers must be cited in solicitations and subsequent 
award documents.



Subpart 508.7--Acquisition From Nonprofit Agencies Employing People Who 
                     Are Blind or Severely Disabled



508.705-70  Adding items to the procurement list.

    (a) When a central non-profit agency (CNA) expresses an interest in 
a particular commodity or service being added to the Procurement List, 
the contracting officer shall provide the CNA with the most recent 
solicitations issued for the supply or service involved and the price(s) 
at which the item was awarded.
    (b) The Committee for Purchase from People Who Are Blind or Severely 
Disabled (the Committee), if requested by the CNA, may assign the supply 
or service to the CNA for development by a workshop and will list the 
item in the Preliminary Evaluation Record. A copy of the record, updated 
monthly, is maintained by the Office of Enterprise Development (E).
    (c) Before issuing a solicitation, contracting officers shall 
request from the CNA, the status of any item previously identified as 
one in which the Committee has expressed interest.
    (d) The Committee may request that a procurement be delayed pending 
Committee action. The contracting activity shall consult with E before 
rejecting such a request.
[54 FR 26505, June 23, 1989, as amended at 60 FR 54956, Oct. 27, 1995]



508.705-71  Workshop performance capability.

    In addition to the annual requirement, the purchase document must 
include an estimated monthly requirement. The contracting officer may 
verify the workshop's ability to satisfy the Government's anticipated 
requirement by requesting a preaward survey. If it is determined that 
the Government's estimated monthly requirement exceeds the workshop's 
ability to perform, a purchase exception may be requested only for those 
quantities which cannot be provided in a timely manner by the workshop.

[[Page 321]]



508.705-74  Compliance with orders.

    (a) Contracting officers shall take appropriate action on delinquent 
delivery orders until all deliveries are made. In cases of excusable 
delays, contract  delivery  schedules  should  be  extended without 
obtaining consideration. However, when the delay is inexcusable, normal 
procedures should be followed in reviewing and adjusting contract prices 
if appropriate.
    (b) If the CNA delays acting on a request for or refuses to grant a 
purchase exception, the matter should be referred to the contracting 
director for expeditious resolution of the problem with the Committee.



508.706  Purchase exceptions.

    CNA purchase exception numbers must be cited in solicitations and 
subsequent award documents.



       Subpart 508.8--Acquisition of Printing and Related Supplies



508.802  Policy.

    The Director of the Reproduction Services Division (CAR) is the 
central printing authority for GSA and serves as the liaison with the 
Joint Committee on Printing and the Public Printer on all matters 
related to printing.



PART 509--CONTRACTOR QUALIFICATIONS--Table of Contents




           Subpart 509.1--Responsible Prospective Contractors

Sec.
509.105  Procedures.
509.105-1  Obtaining information.
509.105-3  Disclosure of preaward information.
509.106  Preaward surveys.
509.106-2  Requests for preaward survey.

                Subpart 509.2--Qualification Requirements

509.202  Policy.
509.204  Responsibility for establishment of a qualification 
          requirement.
509.206  Acquisitions subject to qualification requirements.
509.206-1  General.
509.206-2  Solicitation provisions and contract clauses.

            Subpart 509.3--First Article Testing and Approval

509.302  General.
509.303  Use.
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.
509.405-1  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.

           Subpart 509.5--Organizational Conflicts of Interest

509.503  Waiver.
509.507  Procedures.

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

    Source:  54 FR 26507, June 23, 1989, unless otherwise noted.



           Subpart 509.1--Responsible Prospective Contractors



509.105  Procedures.



509.105-1  Obtaining information.

    (a) In making a determination of responsibility, the contracting 
officer may use the GSA Form 527, Contractor's Qualifications and 
Financial Information, to obtain information regarding financial 
capability from a prospective contractor.
    (b) Advice should be obtained from all appropriate activities, 
including legal counsel, quality control, credit and finance, in 
arriving at a determination that an offeror qualifies as responsible 
under the standards set forth in FAR 9.104.
    (c) The ``auditor'' in FAR 9.105-1(b)(2)(ii) is the Assistant 
Inspector General for Audits in the Central Office or the Regional 
Inspector General for Audits in the regions except for the evaluation of 
a prospective contractor's financial competence and credit

[[Page 322]]

needs, then it is the Chief, Credit and Finance Section, Region 6.



509.105-3  Disclosure of preaward information.

    When an offer is rejected because of a determination by the 
contracting officer that the prospective contractor is not responsible, 
the contracting officer shall notify the prospective contractor by 
letter of the basis for the rejection. This will provide the offeror 
with the opportunity to cure the factors that lead to the 
nonresponsibility determination prior to the submission of offers in 
response to future solicitations.



509.106  Preaward surveys.



509.106-2  Requests for preaward survey.

    The contracting officer or a designee requests a preaward survey by 
forwarding the Standard Form 1403, Preaward Survey of Prospective 
Contractor (General), accompanied by the appropriate subparts of the 
preaward survey (Standard Forms 1404 through 1408) to the surveying 
activities. The Federal Supply Service is authorized to use GSA Form 
353, Performance Evaluation & Facilities Report, for preaward surveys 
instead of Standard Forms 1403 through 1406. The contracting officer 
shall complete Section I of the GSA Form 353 in accordance with 
instructions in 553.370-353-I.
[58 FR 64694, Dec. 9, 1993]



                Subpart 509.2--Qualification Requirements



509.202  Policy.

    (a) The Federal Supply Service Commodity Center Engineering Division 
Director shall prepare the written justification required by FAR 
9.202(a)(1).
    (b) The heads of contracting activities shall approve determinations 
under FAR 9.202(e) that a proposed procurement need not be delayed to 
comply with FAR 9.202(a).



509.204  Responsibility for establishment of a qualification requirement.

    The Commodity Center Director shall make determinations under FAR 
9.204(a)(2) that the Government should bear the cost of conducting 
specified testing and evaluation for a small business concern or a 
product manufactured by a small business concern.



509.206  Acquisitions subject to qualification requirements.



509.206-1  General.

    The contracting director shall submit requests that a qualification 
requirement not be enforced in a particular acquisition to the Commodity 
Center Engineering Division Director under FAR 9.206-1(e)(3).



509.206-2  Solicitation provisions and contract clauses.

    The contracting officer shall insert the clause at 552.209-73, 
Product Removal from Qualified Products List, in solicitations and 
contracts, when qualified products are to be acquired. The clause 
supplements the clauses at FAR 52.209-1 and 52.209-2.



            Subpart 509.3--First Article Testing and Approval



509.302  General.

    When first article testing and approval is appropriate for a 
procurement pursuant to FAR Subpart 9.3, the general policy of the 
Federal Supply Service (FSS) is to require:
    (a) The contractor to perform required testing, unless after 
coordinating with the technical specialist and Quality Assurance 
Division (FQA) in the Office of Quality and Contract Administration the 
contracting officer determines that Government testing is in the best 
interest of the Government;
    (b) That the first article be produced at the same facility where 
production quantities will be produced; and
    (c) That the first article serve as the manufacturing standard.



509.303  Use.

    The contracting officer shall coordinate all determinations to 
require first article testing and approval with the technical specialist 
and FQA. At the time of coordination, the contracting officer should 
obtain the following information from the technical specialist and FQA:

[[Page 323]]

    (a) The test requirements for inclusion in the solicitation as 
outlined in FAR 9.306 (a) and (b).
    (b) Advice on whether the contractor or the Government should 
perform required testing.
    (c) The information necessary to complete the fill-in requirements 
of FAR clauses 52.209-3 First Article Approval--Contractor Testing [and 
alternates], and 52.209-4 First Article Approval--Government Testing 
[and alternates].



509.306  Solicitation requirements.

    The contracting officer shall insert the provision at 552.209-74, 
Waiver of First Article Testing and Approval Requirement, in 
solicitations that require first article testing and approval. Any 
determinations to waive first article testing under FAR 9.306(c) must be 
approved before award by the technical specialist and the Quality 
Assurance Division (FQA). The first article tests to be performed by the 
contractor or the Government must be set forth in the solicitation.



509.308  Contract clauses.



509.308-1  Testing performed by the contractor.

    In accordance with FAR 9.308-1, the FSS contracting officers shall 
use the clause at FAR 52.209-3 with its Alternate I and the supplemental 
clause at 552.209-75, Supplemental Requirements for First Article 
Approval--Contractor Testing.



509.308-2  Testing performed by the Government.

    In accordance with FAR 9.308-2, FSS contracting officers shall use 
the clause at FAR 52.209-4 with its Alternate I and the supplemental 
clause at 552.209-76, Supplemental Requirements for First Article 
Approval--Government Testing.



         Subpart 509.4--Debarment, Suspension, and Ineligibility



509.401  Applicability.

    This subpart applies to acquisitions of personal property, 
nonpersonal services (including construction), space in buildings, 
transportation services (FPMR Subpart 101-40.4), contracts for disposal 
of personal property (FPMR Subpart 101-45.6), and to covered 
transactions as defined at GSPMR 105-68.110(a).



509.403  Definitions.

    Debarring official and suspending official mean the Associate 
Administrator for Acquisition Policy or a designee.
    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.



509.405-1  Continuation of current contracts.

    (a) Termination of current contracts should be considered under the 
circumstances set forth in (a) (1) and (2) of this section.
    (1) When the circumstances giving rise to the debarment or 
suspension also constitute a default in the contractor's performance of 
the contract, termination for default under the contract's ``Default'' 
clause is appropriate.
    (2) If the contractor presents a significant risk to the Government 
in completing a current contract, the contracting officer shall 
determine whether termination for convenience or cancellation under 
appropriate contract provisions is in the Government's best interest. In 
making this determination, the contracting officer shall consult with 
counsel and should consider the following factors:
    (i) Seriousness of the cause for debarment or suspension;
    (ii) Extent of contract performance;
    (iii) Potential costs of termination and reprocurement;
    (iv) Urgency of the requirement and the impact of the delay of 
reprocurement;
    (v) Availability of other safeguards to protect the Government's 
interest until completion of the contract.

[[Page 324]]

    (b) The debarring or suspending official shall make determinations 
under FAR 9.405-1(b).
    (c) The contracting officer should consult with legal counsel 
regarding the availability of remedies under FAR Subparts 3.2 and 3.7.



509.405-2  Restrictions on subcontracting.

    The debarring or suspending official shall make determinations under 
FAR 9.405-2.



509.406  Debarment.



509.406-1  General.

    The debarring official shall make determinations under FAR 9.406-
1(c).



509.406-3  Procedures.

    (a) Investigation and referral. (1) Any element of GSA, acting as a 
contracting activity, that becomes aware of circumstances which may 
serve as the basis for a debarment shall refer the matter to the 
debarring official for consideration. Circumstances that involve 
possible criminal or fraudulent activities must first be reported to the 
Office of the Inspector General (OIG) in accordance with GSPMR 105.735-
216, Reporting Suspected Irregularities. If appropriate, the Inspector 
General will refer the matter to the debarring official.
    (2) At a minimum, referrals for consideration of debarment action 
should include:
    (i) The recommendation and rationale for the referral;
    (ii) A statement of facts;
    (iii) Copies of documentary evidence and a list of all witnesses, 
including addresses and telephone numbers, together with a statement 
concerning their availability to appear at a fact-finding proceeding and 
the subject matter of their testimony;
    (iv) A list of parties including the contractor, principals, and 
affiliates (including last known home and business addresses, zip codes, 
and DUNS Number);
    (v) GSA's acquisition history with the contractor, including recent 
experience under contracts and copies of the pertinent contracts;
    (vi) A list of any known active or potential criminal 
investigations, criminal or civil proceedings, or administrative claims 
before the Board of Contract Appeals; and
    (vii) A statement regarding the impact of the debarment action on 
GSA programs. This statement is not required for referrals by the 
Inspector General.
    (3) Referrals may be returned to the originator for further 
information or development.
    (b) Decisionmaking process. (1) Upon receipt of a referral, the 
debarring official will decide whether to initiate debarment action, 
after coordinating the matter with assigned legal counsel.
    (2) Contracting activities will be notified of proposed debarments.
    (3) Where a determination is made not to initiate action, notice 
will be given to the agency official who made the referral.
    (4) If a response to the notice of proposed debarment is not 
received by the debarring official within 30 calendar days of a party's 
receipt of the notice, the debarment becomes final.
    (5) If the party desires to present information and arguments in 
person to the debarring official, an oral presentation will be held 
within 20 calendar days of receipt of the request, unless a longer 
period of time is requested by the party. The oral presentation will be 
informally conducted and a transcript need not be made. The party may 
supplement the oral presentation with written information and arguments.
    (6) Upon request, the affected party will be furnished a copy of the 
administrative record which formed the basis for the decision to propose 
debarment. If there is a reason to withhold from the party any portion 
of the record, the party will be notified that a portion of the record 
is being withheld and will be informed of the reasons for the 
withholding.
    (7) In actions not based on a conviction or judgment, the party may 
request a fact-finding hearing to resolve a genuine dispute of material 
fact. The party shall identify the material facts in dispute and the 
basis for disputing

[[Page 325]]

the facts. If the debarring official determines that there is a genuine 
dispute of material fact, the debarring official shall refer the matter 
to the fact-finding official. The fact-finding official will schedule a 
hearing within 20 calendar days of receipt of the debarring official's 
request. Extensions may be granted for good cause upon the request of 
the party or the agency.
    (8) The purpose of a fact-finding hearing is to:
    (i) Afford the affected party the opportunity to dispute material 
facts relating to the proposed debarment through the submission of oral 
and written evidence;
    (ii) Resolve facts in dispute and provide the debarring official 
with written findings of fact based on a preponderance of evidence; and
    (iii) Provide the debarring official with a determination as to 
whether a cause for debarment exists, based on facts as found.
    (9) Hearings will be conducted by the fact-finding official in 
accordance with rules consistent with FAR 9.406-3(b)(2) promulgated by 
that official.
    (10) The fact-finding official will notify the affected parties of 
the schedule for the hearing. The fact-finding official shall deliver 
written findings of fact to the debarring official (together with a 
transcription of the proceeding, if made) within 20 calendar days after 
the hearing record closes.
[54 FR 26507, June 23, 1989, as amended at 56 FR 47005, Sept. 17, 1991; 
58 FR 26920, May 6, 1993]



509.407  Suspension.



509.407-1  General.

    The suspending official shall make determinations under FAR 9.407-
1(d).



509.407-3  Procedures.

    (a) Investigation and referral. The procedures in 509.406-3(a) apply 
to referrals for suspension.
    (b) Decisionmaking process. (1) Upon receipt of a referral, the 
suspending official will decide whether to suspend, after coordinating 
the matter with assigned legal counsel.
    (2) In cases not based on an indictment, the suspending official 
must, through OIG, coordinate with the Department of Justice, or state 
prosecutorial authority. On the basis of advice received, the suspending 
official shall determine whether substantial interests of the Federal or 
a state government would be impaired in fact-finding.
    (3) A response to a suspension notice must be received by the 
suspending official within 30 calendar days of receipt by the parties to 
be considered.
    (4) When requested, an oral presentation before the suspending 
official will be conducted as outlined in 509.406-3(b)(5).
    (5) Upon request, a copy of the administrative record will be 
furnished to the affected party under the guidelines set forth at 
509.406-3(b)(6).
    (6) Fact-finding hearings will not be conducted in actions based on 
indictments, or in cases in which the suspending official determines 
pursuant to FAR 9.407-3(b)(2) not to refer a matter to the fact-finding 
official. A party may request a fact-finding hearing to resolve genuine 
disputes of material fact in other cases. The party shall identify the 
material facts in dispute and the basis for disputing the facts. If the 
suspending official determines that there is a genuine dispute of 
material fact, the suspending official shall refer the matter to the 
fact-finding official. The fact-finding official will schedule a hearing 
within 20 calendar days of receipt of the suspending official's request. 
Extensions may be requested by the party or the agency.
    (7) The purpose of a fact-finding hearing is to:
    (i) Afford the affected party the opportunity to dispute facts 
relating to the suspension action through the submission of oral and 
written evidence;
    (ii) Determine whether, in light of the evidence presented, there is 
adequate evidence to suspect that the material allegations in the notice 
are true; and
    (iii) Provide the suspending official with a determination as to 
whether the evidence is adequate to support a cause for suspension. 
Hearings will be conducted as outlined in 509.406-3(b)(9).
[54 FR 26507, June 23, 1989, as amended at 54 FR 40060, Sept. 29, 1989; 
58 FR 26920, May 6, 1993; 58 FR 29254, May 19, 1993]

[[Page 326]]



           Subpart 509.5--Organizational Conflicts of Interest



509.503  Waiver.

    The Associate Administrator for Acquisition Policy approves requests 
to waive the general rules or procedures of FAR Subpart 9.5.



509.507  Procedures.

    If a potential contractor disagrees with the contracting officer's 
resolution of a potential organizational conflict of interest (see FAR 
9.507(b)(4)), the matter must be referred to the Associate Administrator 
for Acquisition Policy for a determination.



PART 510--MARKET RESEARCH  [RESERVED]






PART 511--DESCRIBING AGENCY NEEDS--Table of Contents




Sec.
511.001  Definitions.
511.002  Policy.

     Subpart 511.1--Selecting and Developing Requirements Documents

511.103  Market acceptance.
511.170  Use of brand name or equal product descriptions.

       Subpart 511.2--Using and Maintaining Requirements Documents

511.204  Solicitation provisions and contract clauses.

            Subpart 511.4--Delivery or Performance Schedules

511.401  General.
511.404  Contract clauses.

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

    Source:  54 FR 26511, June 23, 1989, unless otherwise noted.



511.001  Definitions.

    Dual systems mean the use of both inch-pound and metric systems. For 
example, an item is designed, produced, and described in inch-pound 
values with soft metric values also shown for information or comparison 
purposes.
    Hybrid systems mean the use of both inch-pound and hard metric 
values in specifications, standards, supplies, and services; e.g., an 
engine with internal parts in metric dimensions and external fittings or 
attachments in inch-pound dimensions.
    Metric system means the International System of Units established by 
the General Conference of Weights and Measures in 1960. The units are 
listed in Federal Standard 376A, ``Preferred Metric Units for General 
Use by the Federal Government.''
    Soft metric means the result of mathematical conversion of inch-
pound measurements to metric equivalents in specifications, standards, 
supplies, and services. The physical dimensions are not changed.
    Specification Manager means an official of the Federal Supply 
Service office responsible for Federal or Interim Federal Specifications 
(or the program office for other than Federal specifications) and for 
reviewing requests for a deviation from a specification.
[56 FR 2864, Jan. 25, 1991. Redesignated at 61 FR 6165, Feb. 16, 1996]



511.002  Policy.

    Consistent with the policy expressed in FAR 11.002(b) and GSA Order 
ADM 8000.1A, solicitations must include specifications and purchase 
descriptions stated in metric units of measurement whenever metric is 
the accepted industry system. If metric is not the accepted industry 
system, the head of Central Office Services responsible for nationwide 
programs shall ensure that policies promoting and encouraging the use of 
soft metric, hybrid, or dual systems are developed, except when to do so 
would be detrimental to the program mission. Whenever possible, 
commercially developed metric specifications and internationally or 
domestically developed voluntary standards using metric measurements 
must be adopted. While an industry is in transition to metric, 
solicitations must include specifications and purchase descriptions 
stated in soft metric, hybrid, or dual systems, except when impractical 
or inefficient.
[56 FR 33721, July 23, 1991. Redesignated and amended at 61 FR 6165, 
Feb. 16, 1996]

[[Page 327]]



     Subpart 511.1--Selecting and Developing Requirements Documents

    Source:  61 FR 6165, Feb. 16, 1996, unless otherwise noted.



511.103  Market acceptance.

    The contracting officer may require offerors to meet market 
acceptance criteria in accordance with FAR 11.103 when such criteria 
determined necessary to satisfy the agency's needs.



511.170  Use of brand name or equal product descriptions.

    (a) Policy. When a ``brand name or equal'' purchase description is 
used the purchase description should--
    (1) Cite all brand name products known to be acceptable and of 
current manufacture;
    (2) Specify each physical or functional characteristic essential to 
the intended use of the product including permissible tolerances;
    (3) Avoid specifying characteristics that cannot be shown to 
materially affect the intended end use and which unnecessarily restrict 
competition; and
    (4) Give prospective offerors the opportunity to offer products 
other than those specifically referenced by brand name, as long as they 
meet the needs of the Government in essentially the same manner as the 
brand name product.
    (b) Solicitation provisions. The solicitation--
    (1) May require bid samples for ``or equal'' offers, but not for 
``brand name'' offers.
    (2) Must provide for full consideration and evaluation of ``or 
equal'' offers against the salient characteristics specified in the 
purchase description. Do not reject offers for minor differences in 
design, construction, or features which do not affect the suitability of 
the product for its intended use.
    (3) Must include the following immediately after the item 
description--

Offering on:

 Manufacturer's Name____________________________________________________
 Brand__________________________________________________________________
 Model or Part No.______________________________________________________

    (4) Should include the following notice, unless bid samples are 
required for ``or equal'' offers, in the item listing after each brand 
name or equal item (or component part) or at the bottom of each page 
listing several items:

    OFFERORS OFFERING OTHER THAN BRAND NAME ITEMS IDENTIFIED HEREIN MUST 
PROVIDE ADEQUATE INFORMATION TO ENSURE THAT A DETERMINATION CAN BE MADE 
AS TO EQUALITY OF THE PRODUCT(S) OFFERED.

    (c) Contract clause. The contracting officer shall include a clause 
substantially the same as the clause at 48 CFR 552.211-70, Brand Name or 
Equal, when a brand name or equal purchase description is used. When 
component parts or an end item are described by brand name or equal 
descriptions and application of the clause to some or all of the 
components is impracticable, either do not use the clause or limit its 
application to specified components.



       Subpart 511.2--Using and Maintaining Requirements Documents



511.204  Solicitation provisions and contract clauses.

    (a) The contracting officer shall insert the clause at 48 CFR 
552.211-71, Standard References, in solicitations and contracts for 
construction services when the contract amount is expected to exceed the 
simplified acquisition threshold and when:
    (b) The contracting officer shall insert the clause at 48 CFR 
552.211-72, Reference to Specifications in Drawings, in solicitations 
and contracts citing Federal specifications which contain drawings.
    (c) The contracting officer shall include the clause at 48 CFR 
552.211-73, Marking, in requirements solicitations and contracts for 
supplies when deliveries may be made to civilian and military activities 
and the contract amount is expected to exceed the simplified acquisition 
threshold. The clause may be used in definite quantity contracts when it 
is appropriate.
    (d) The contracting officers shall insert the clause at 48 CFR 
552.211-74, Charges for Marking, in solicitations

[[Page 328]]

and contracts that include the clause at 48 CFR 552.211-73 or a similar 
clause.
    (e) The contracting officer shall include the clause at 48 CFR 
552.211-75, Preservation, Packaging and Packing, in solicitations and 
contracts for supplies when the contract amount is expected to exceed 
the simplified acquisition limitation. The contracting officer may 
include the clause in contracts awarded through simplified acquisition 
procedures when appropriate.
    (f) The contracting officer shall insert a clause substantially the 
same as the clause at 48 CFR 552.211-76, Charges for Packaging and 
Packing, in solicitations and contracts for supplies that are to be 
delivered to GSA distribution centers.
    (g) The contracting officer shall include the clause at 48 CFR 
552.211-77, Packing List, in solicitations and contracts for supplies, 
including purchases made using simplified acquisition procedures.
[54 FR 26510, June 23, 1989, as amended at 60 FR 42802, Aug. 17, 1995. 
Redesignated and amended at 61 FR 6165, Feb. 16, 1996; 61 FR 10846, Mar. 
15, 1996]



            Subpart 511.4--Delivery or Performance Schedules

    Source:  54 FR 26512, June 23, 1989, unless otherwise noted. 
Redesignated at 61 FR 6166, Feb. 16, 1996.



511.401  General.

    (a) Normally, time of delivery in solicitations and contracts, 
except multiple award schedules, will be stated as ``required'' time of 
delivery (or shipment), expressed in specific periods from receipt by 
the contractor of a notice of award (or receipt of a delivery order). In 
multiple award schedule solicitations delivery times will usually be 
stated as ``desired'' and offerors will indicate a definite number of 
days for delivery.
    (b) The contracting officer must be satisfied that the 
requisitioning office has justified, in writing, an unusually short time 
of delivery. This is particularly important where the time specified is 
so short that it may limit competition and possibly result in higher 
prices. Examples of justifications are:
    (1) Furniture is required to outfit quarters scheduled for occupancy 
on a specific date;
    (2) Construction material is required to meet job progress 
schedules; and
    (3) Supplies are required at a port to meet scheduled ship 
departures.
    (c) When a portion of the total delivery is needed early, the 
contracting officer should:
    (1) Consider requiring that portion by the early date and the 
balance later; and
    (2) Determine whether the portion required early and the balance 
should be included as separate items in the same solicitation or whether 
the two portions should be procured separately.
    (d) When a solicitation contains a mixture of items that require 
different times for delivery, the delivery periods should be set forth 
separately and items with similar delivery time requirements should be 
grouped according to delivery times in the solicitation.
    (e) In negotiations for multiple award schedules, the contracting 
officer should secure the best possible delivery time regardless of the 
``desired'' delivery time(s) in the solicitation. For example, some 
offers comply with the Government's desired delivery time but others 
cite delivery times which are substantially shorter. The former should 
be negotiated to bring them in line with the latter. Variable delivery 
time offers (e.g., 30-90 days) should be negotiated to keep the timespan 
to a minimum. If the span applies to several items or several quantity 
breaks for one item, the items or item quantity breaks should be 
segregated into smaller groups which can be assigned more specific 
delivery times.
[54 FR 26512, June 23, 1989. Redesignated at 61 FR 6166, Feb. 16, 1996]



511.404  Contract clauses.

    (a) Supply contracts. The contracting officer shall insert the 
clause at:
    (1) 48 CFR 552.211-1, Time of Delivery, in solicitations and single 
award schedule contracts for supplies. If it is necessary to show 
different delivery times for different items or groups of items, use 
Alternate I.
    (2) 48 CFR 552.211-78, Commercial Delivery Schedule (Multiple Award

[[Page 329]]

Schedule), in solicitations issued and contracts awarded under the 
multiple award schedule program.
    (3) 48 CFR 552.211-79, Acceptable Age of Supplies, or 48 CFR 
552.211-80, Age on Delivery, in solicitations and contracts if the 
contractor will be required to furnish shelf-life items within a 
specified number of months from the date of manufacture or production of 
the supplies. (See 101-27.206-2 of the Federal Property Management 
Regulation.) The Acceptable Age of Supplies clause at 48 CFR 552.211-79 
should be used when the required shelf-life period is 12 months or less, 
and lengthy acceptance testing may be involved. For items having a 
limited shelf-life, Alternate I to 48 CFR 552.211-79 must be substituted 
for the basic clause when required by the director of the FSS commodity 
center concerned. The Age on Delivery clause at 48 CFR 552.211-80 should 
be used when the required shelf life period is more than 12 months, or 
when source inspection can be performed within a short time period.
    (4) 48 CFR 552.211-81, Time of Shipment, in solicitations and stock 
replenishment contracts that do not include the Availability for 
Inspection, Testing and Shipment/Delivery clause at 48 CFR 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) 48 CFR 552.211-82, Notice of Shipment, in solicitation and 
contracts for supplies when it is in the Government's interest to have 
the contractor furnish a notice of shipment.
    (6) 48 CFR 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 timeframes cannot be determined in advance. If the 
contract is for stock items, use Alternate I.
    (b) Construction contracts. The contracting officer shall insert the 
clause at 48 CFR 552.211-84, Non-compliance with Contract Requirements, 
in solicitations and contracts for construction when the contract amount 
is expected to exceed the simplified acquisition threshold.
[54 FR 26512, June 23, 1989, as amended at 60 FR 42803, Aug. 17, 1995. 
Redesignated and amended at 61 FR 6166, Feb. 16, 1996; 61 FR 14033, Mar. 
29, 1996]



PART 512--ACQUISITION OF COMMERCIAL ITEMS--Table of Contents




 Subpart 512.2--Special Requirements for the Acquisition of Commercial 
                                  Items

Sec.
512.203  Procedures for solicitation, evaluation, and award.
512.209  Pricing of commercial items when contracting by negotiation.

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

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

    Source:  54 FR 26512, June 23, 1989, unless otherwise noted.



 Subpart 512.2--Special Requirements for the Acquisition of Commercial 
                                  Items

    Source:  61 FR 6166, Feb. 16, 1996, unless otherwise noted.



512.203  Procedures for solicitation, evaluation, and award.

    Contracting officers shall use the policies in FAR Part 12 and 48 
CFR Part 512 in conjunction with the policies and procedures for Federal 
Supply Schedules in FAR Part 38 and 48 CFR Part 538.



512.209  Pricing of commercial items when contracting by negotiation.

    When awarding multiple award schedule contracts for commercial 
items, the policies and procedures in FAR Part 15 and 48 CFR Part 515 
shall be used to establish the reasonableness of prices.

[[Page 330]]



  Subpart 512.3--Solicitation Provisions and Contract Clauses for the 
                     Acquisition of Commercial Items

    Source:  61 FR 6166, Feb. 16, 1996, unless otherwise noted.



512.301  Solicitation provisions and contract clauses for the acquisition of commercial items.

    (a) Solicitation provisions/clauses. The contracting officer shall 
insert the following provisions or clauses in solicitations for the 
acquisition of commercial items in accordance with the prescriptions 
provided:
    (1) The provision at 48 CFR 552.212-70, Preparation of Offer 
(Multiple Award Schedule), in solicitations issued under the multiple 
award schedule program.
    (2) The clause at 48 CFR 552.212-71, Contract Terms and Conditions 
Applicable to GSA Acquisition of Commercial Items when listed clauses 
apply and are incorporated by reference. The clause provides for the 
incorporation by reference of terms and conditions which are, to the 
maximum extent practicable, consistent with customary commercial 
practice. The contracting officer may tailor this clause.
    (3) The clause at 48 CFR 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 and are 
incorporated by reference. The clause provides for the incorporation by 
reference of terms and conditions which are required to implement 
provisions of law or executive orders applicable to acquisitions of 
commercial items.
    (4) The provision at 48 CFR 552.212-73, Evaluation--Commercial Items 
(Multiple Award Schedule), shall be used instead of FAR 52.212-2 in 
solicitations issued under the multiple award schedule program.
    (b) Use of required GSAR provisions and clauses. Notwithstanding 
prescriptions contained elsewhere in the GSAR (48 CFR Chapter 5), when 
acquiring commercial items, contracting officers shall be required to 
use only those provisions and clauses prescribed in this part. The 
provisions and clauses prescribed in this part shall be revised, as 
necessary, to reflect the applicability of statutes and executive orders 
to the acquisition of commercial items.
    (c) Discretionary use of GSAR provisions and clauses. The 
contracting officer may include in solicitations and contracts by 
addendum other GSAR provisions and clauses when their use is consistent 
with the limitations contained in FAR 12.302(c).
    (d) Use of additional provisions and clauses. Provisions or clauses 
that are not prescribed in the FAR or GSAR for use in contracts for 
commercial items may not be used unless approved by the Senior 
Procurement Executive (see 48 CFR 502.101) or determined to be 
consistent with customary commercial practice through market research.



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

    Requests for waivers shall be prepared in accordance with FAR 
12.302(c) and submitted for approval by the chief of the contracting 
office (see 48 CFR 502.101) if an individual contract is involved or by 
the contracting director (see 48 CFR 502.101) if a class of contracts is 
involved.

[[Page 331]]



          SUBCHAPTER C--CONTRACTING METHODS AND CONTRACT TYPES





PART 513--SIMPLIFIED ACQUISITION PROCEDURES--Table of Contents




                         Subpart 513.1--General

Sec.
513.106  Solicitation competition, evaluation of quotes, and award.
513.106-70  Unusual and compelling urgency procurements.

               Subpart 513.2--Blanket Purchase Agreements

513.203  Establishment of Blanket Purchase Agreements.
513.203-1  General.

                  Subpart 513.3--Fast Payment Procedure

513.301  General.

                       Subpart 513.4--Imprest Fund

513.403  Agency responsibilities.
513.404  Conditions for use.
513.405  Procedures.

                     Subpart 513.5--Purchase Orders

513.505  Purchase order and related forms.
513.505-2  Agency order forms in lieu of Optional Forms 347 and 348.
513.505-3  Standard Form 44, Purchase Order-Invoice-Voucher.
513.505-70  Two-party contract forms.

               Subpart 513.70--Certified Invoice Procedure

513.7001  Certified invoice procedure for procurements not requiring a 
          written purchase order.

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

    Source:  54 FR 26512, June 23, 1989, unless otherwise noted.



                         Subpart 513.1--General



513.106  Solicitation competition, evaluation of quotes, and award.

    (a) Oral solicitation. When quotations are being solicited orally 
and the Service Contract Act applies information on the Act and the 
applicable wage determination must be communicated to potential 
contractors.
    (b) Data to support simplified acquisitions. (1) The GSA Form 2010, 
Small Purchase Tabulation Source List/Abstract, is available for use to 
document written and oral quotations for purchases in excess of $2,500.
    (2) When quotes or offers are being evaluated based on price alone 
and other than the lowest quotation is selected for award, the basis for 
rejecting any lower quotation should be documented.
[60 FR 42803, Aug. 17, 1995]



513.106-70  Unusual and compelling urgency procurements.

    When a procurement is of unusual and compelling urgency, competition 
may be solicited by having prospective sources visit the site together, 
orally informing them of the exact requirements, and requesting them to 
prepare quotations while written specifications are being prepared for 
inclusion in the contract. Unusual and compelling urgency, as used in 
this subsection, includes situations which, if not corrected 
immediately, will result in unnecessary expenditure of funds, property 
damage, personal injury, or interruption of agency functions.



               Subpart 513.2--Blanket Purchase Agreements



513.203  Establishment of Blanket Purchase Agreements.



513.203-1  General.

    (a) Document preparation. Blanket purchase agreements (BPA's) must 
be prepared on a purchase order form or on a GSA Form 3521, Blanket 
Purchase Agreement.
    (b) Terms and conditions. Each blanket purchase agreement should, 
when appropriate, specify the geographic area to be served under the 
BPA.
    (c) Placing orders under the BPA. Only the contracting officer (CO) 
or officials authorized by a CO and designated in the BPA are authorized 
to place orders under the BPA. The GSA Form 2877, Non-Depot Item 
Requisition / Order / Receiving / Payment Record, is authorized for use 
by the Federal Supply

[[Page 332]]

Service in placing orders against BPA's for customer supply center items 
that are not available from Government supply depots. Before placing 
orders against the BPA, each requirement must be screened for 
availability from mandatory sources of supply. Necessary controls must 
be maintained by the person placing orders under the BPA to ensure that 
any limitation stated therein is not exceeded. The BPA number and 
purchase number should be specified each time an order is placed.
    (d) Delivery or service tickets. Each delivery ticket, in addition 
to the requirements of FAR 13.203-1(j)(6), must contain the name of the 
person placing the order. The delivery ticket must be signed and dated 
by the individual receiving the items or services. The supplier and the 
receiving office must retain a copy of the delivery ticket.
    (e) Invoicing. If a supplier will not accept one of the invoicing 
statements outlined in FAR 13.203-1(j)(7), the contracting officer is 
authorized to deviate from FAR 13.203(j)(7) in order to permit the 
submission and payment of invoices for each delivery under the BPA. 
Before authorizing submission and payment of invoices for individual 
deliveries, the contracting officer must make every effort to get the 
supplier to accept one of the FAR invoicing statements. The BPA file 
must document the contracting officer's efforts and the supplier's 
refusal to accept the FAR invoicing statements.
    (f) Processing invoices. Invoices must be time-stamped by the 
designated billing office to indicate the date of receipt. Invoices 
received by ordering offices must be forwarded to the appropriate 
Finance Division for payment within 5 workdays of receipt of the invoice 
or acceptance of the supplies or services, whichever is later, unless 
the BPA provides for the accumulation of invoices as outlined in FAR 
13.203-1(j)(7)(iii). If the BPA provides for accumulation of invoices by 
the ordering office for a specified period, the ordering office must 
forward the accumulated invoices to the appropriate Finance Division for 
payment within 5 workdays after the specified period for accumulation. 
All invoices should be marked to indicate that purchases were made under 
a BPA.



                  Subpart 513.3--Fast Payment Procedure



513.301  General.

    The fast payment procedure is not authorized for use by GSA 
contracting activities.



                       Subpart 513.4--Imprest Fund



513.403  Agency responsibilities.

    Imprest fund cashiers must be designated and will function in 
accordance with HB, Accounting Users Guide--Imprest Fund and Travelers 
Checks (COM P 4268.1) and FAR Subpart 13.4.



513.404  Conditions for use.

    The per transaction limitation for cash payments made through 
imprest funds is $500 ($600 for emergency disbursements by imprest fund 
cashiers in Alaska).



513.405  Procedures.

    The SF 1164, Claim for Reimbursement for Expenditures on Official 
Business, or SF 1165, Receipt for Cash--Subvoucher, will serve as the 
authorized purchase requisition for purchases made by offices 
maintaining their own imprest funds, e.g., Public Buildings Service 
Field Offices. Purchase requisitions such as the GSA Form 49, 
Requisition/Procurement Request for Equipment, Supplies or Services, may 
be used if required by contracting activity directives. If the GSA Form 
49 is used, it must be endorsed ``Payment to be made from imprest 
fund.''



                     Subpart 513.5--Purchase Orders



513.505  Purchase order and related forms.



513.505-2  Agency order forms in lieu of Optional Forms 347 and 348.

    (a) Unless another form is prescribed, the GSA Form 300 or 300-1 
(pin-feed format), Order for Supplies and Services, must be used instead 
of the OF 347, Order for Supplies or Services, when making purchases 
payable through the National Electronic Accounting and

[[Page 333]]

Reporting (NEAR) System. The forms may also be used to make other 
purchases when a specific form is not prescribed or as a delivery order 
to place orders under established contracts. The GSA Form 300 must be 
prepared and processed in accordance with the instructions at 553.370-
300-I. GSA Form 300A or 300-A(1) (pin-feed format), order for Supplies 
or Services (continuation), is available for use with GSA Form 300 or 
300-1.
    (b) The GSA Form 1458, Motor Vehicle Shop Work Order, Repair and 
Purchase Order, must be used instead of the OF 347 when making purchases 
in connection with the maintenance, servicing or repair of GSA fleet 
management vehicles.
    (c) The GSA Form 3186, Order for Supplies or Services, GSA Form 
3186A, Order for Supplies or Services, or GSA Form 3186B, Order for 
Supplies or Services (EDI), must be used instead of the OF 347, Order 
for Supplies or Services, when making simplified acquisitions or placing 
delivery orders against established contracts through the FSS-19 system. 
The GSA Form 3186 must be used when generating orders against 
established contracts that will be mailed to contractors. The GSA Form 
3186A must be used when orders, utilizing simplified acquisition 
procedures, will be mailed to the contractors. The GSA Form 3186B must 
be generated and placed in the file to document delivery orders and 
purchase orders transmitted to contractors electronically using 
Electronic Data Interchange (EDI) procedures. The GSA Form 3186C, 
Purchase Order Notice, or electronic equivalent, simultaneously will be 
generated by FSS-19 to provide summary data from the order to the 
consignee and the freight forwarder (if designated).
    (d) GSA Form 8002, Motor Vehicle Delivery Order, is used to order 
fleet management vehicles. This form is not intended for use as a 
purchase order for simplified acquisitions and does not include 
provisions and clauses on the reverse.
[54 FR 26512, June 23, 1989, as amended at 57 FR 7555, Mar. 3, 1992; 60 
FR 42803, Aug. 17, 1995]



513.505-3  Standard Form 44, Purchase Order-Invoice-Voucher.

    (a) General. Use of the Standard Form 44 will not serve the best 
interest of either the Government or business when the accounting system 
of the seller requires production of an invoice as a matter of routine. 
In these cases, other authorized methods of making simplified 
acquisitions should be used. Whenever possible, preference should be 
given to the use of Governmentwide commercial purchase card.
    (b) Issuance of books from stock. SF 44 books will be issued to 
contracting directors or their designees. Contracting directors are 
responsible for the custody and issuance of books to the users.
[54 FR 26502, June 23, 1989, as amended at 60 FR 42803, Aug. 17, 1995]



513.505-70  Two-party contract forms.

    When a determination is made that it is in the Government's interest 
to negotiate a two-party contract (see FAR 13.104(f)) for services, 
Standard Form 1447, Solicitation Contract, may be used.
[60 FR 42803, Aug. 17, 1995]



               Subpart 513.70--Certified Invoice Procedure



513.7001  Certified invoice procedure for procurements not requiring a written purchase order.

    (a) When advantageous to the Government, supplies or services may be 
acquired on the open market from local suppliers using vendors' invoices 
instead of purchase orders. Certified invoice procedures may not be used 
to place orders under established contracts unless authorized in the 
contract.
    (b) Such purchases must comply with FAR Part 13 and Part 513, 
subject to the following:
    (1) The amount of any one purchase is $2,000 or less for 
construction services and $2,500 or less for supplies or service other 
than construction.
    (2) A purchase order is not required by either the supplier or the 
Government.
    (3) The supplier does not accept the Government commercial purchase 
card

[[Page 334]]

or the individual making the purchase does not have a purchase card.
    (4) Appropriate invoices can be obtained from the supplier.
    (c) For special rules governing purchases of hand and measuring 
tools and stainless steel flatware see 525.105-70 and 525.105-71.
    (d) Use of the certified invoice procedure does not eliminate the 
requirements to:
    (1) Verifying price reasonableness in accordance with the conditions 
contained in FAR 13.603.
    (2) Certify that the quality and quantity of items/services 
furnished are in accordance with the verbal agreement made with the 
vendor;
    (e) Quotations may be solicited by authorized personnel without 
contracting officer warrants. Placement of any orders must be approved 
in advance by a contracting officer. The approval shall be in writing 
unless geographic distances make it impracticable to obtain a written 
approval on the GSA Form 2010 or other documentation. In those cases 
telephonic approval may be obtained and a notation of the approval 
recorded.
    (f) Contracting officers using this purchasing technique shall 
require the suppliers to immediately submit properly prepared invoices 
which itemize property or services furnished.
    (g) Upon receiving the invoice, the receiving office shall time-
stamp the invoice to indicate the date the invoice is received, verify 
the accuracy of the invoiced amount, and verify that the supplies and/or 
services have been received and accepted. The contracting officer or a 
designated representative shall obtain a certification of receipt and 
acceptance from the individual that actually inspected and accepted the 
supplies and/or services before certifying the invoice and forwarding to 
the appropriate Finance Division for payment. Supplies and/or services 
should be inspected and accepted or rejected within 7 calendar days of 
delivery/completion. The invoice must be forwarded to the appropriate 
Finance Division for payment within 5 workdays after receipt of the 
invoice or acceptance of the supplies and/or services, whichever is 
later. Before forwarding the invoice to Finance, the contracting officer 
shall stamp it with the Certified Invoice Stamp, complete the accounting 
information, type of business (corporation, sole proprietorship/
partnership, or other), and certification, and affix the ACT number 
label. If a Certified Invoice Stamp is not available, place the 
following statement on the invoice along with the ACT number label, 
accounting information and the type of business. (Note: In some 
organizations, the ACT number label is affixed by a budget or executive 
office within the service or staff office.)
    ``I certify that these goods and/or services were received on [Date] 
and accepted on [Date]. An oral purchase was authorized and no 
confirming order has been issued.''

 _______________________________________________________________________
Signature of Contracting/Ordering Officer
 _______________________________________________________________________
Print name and telephone No.
 _______________________________________________________________________
Date Invoice received___________________________________________________
[54 FR 26512, June 23, 1989, as amended at 56 FR 47005, Sept. 17, 1991; 
57 FR 26609, June 15, 1992; 60 FR 42803, Aug. 17, 1995]



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.
514.201-7  Contract clauses.
514.201-70  GSA forms.
514.201-71  Request for brand name information limitation.
514.202  General rules for solicitation of bids.
514.202-4  Bid samples.
514.202-7  Facsimile bids.
514.203  Methods of soliciting bids.
514.203-1  Transmittal to prospective bidders.
514.204  Records of invitations for bids and records of bids.
514.205  Solicitation mailing lists.
514.205-1  Establishment of lists.
514.211  Release of acquisition information.
514.213  Annual submission of representations and certifications.
514.270  Bid acceptance period.
514.271  Aggregate awards.
514.271-1  General.
514.271-2  Weighting of items for aggregate award.
514.271-3  Grouping of line items for aggregate award.

[[Page 335]]

514.272  Price list method.
514.272-1  Supply contracts.
514.272-2  Repair and alteration contracts.

                    Subpart 514.3--Submission of Bids

514.301  Responsiveness of bids.
514.303  Modification or withdrawal of bids.
514.304  Late bids, late modifications of bids, or late withdrawal of 
          bids.
514.304-1  General.
514.370  Copies of bids required in submission.

          Subpart 514.4--Opening of bids and Award of Contract

514.401  Receipt and safeguarding of bids.
514.402  Opening of bids.
514.402-1  Unclassified bids.
514.403  Recording of bids.
514.404  Rejection of bids.
514.404-1  Cancellation of invitations after opening.
514.404-2  Rejection of individual bids.
514.405  Minor informalities or irregularities in bids.
514.407  Mistakes in bids.
514.407-3  Other mistakes disclosed before award.
514.407-4  Mistakes after award.
514.407-7  Documentation of award.
514.408  Award.
514.408-1  General.
514.408-6  Equal low bids.
514.408-70  Preaward inquiries.
514.408-71  Awards involving related cases referred to higher authority.
514.408-72  Forms for recommending award(s) (Supplies and services).
514.409  Information to bidders.
514.409-1  Award of unclassified contracts.
514.409-70  Restriction on disclosure of inspection or test data.
514.471  Multiple bidding.

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

    Source:  54 FR 26514, June 23, 1989, unless otherwise noted.



                   Subpart 514.2--Solicitation of Bids



514.201  Preparation of invitations for bids.

    See 514.270 for information on specifying a minimum bid acceptance 
period.



514.201-1  Uniform contract format.

    All solicitations must include the following notice:

    The information collection requirements contained in this 
solicitation/contract, that are not required by regulation, have been 
approved by the Office of Management and Budget pursuant to the 
Paperwork Reduction Act and assigned OMB Control No. 3090-0163.



514.201-2  Part I--The Schedule.

    Solicitations that include the Standard Form 33, Solicitation, Offer 
and Award, should include the following cautionary notice:

    Offerors are reminded that block 13 of the Standard Form 33, 
Solicitation, Offer and Award, is to be used to offer prompt payment 
discounts. Payment terms are set forth in the Prompt Payment clause of 
this solicitation. Offerors are cautioned against inserting any 
statement in block 13 which indicates that payment is due sooner than 
the time stipulated in the Prompt Payment clause.

    Example: Inserting ``NET 20'' in block 13 will cause the offer to be 
rejected as nonresponsive because the entry would be contrary to the 30 
day payment terms specified in the Prompt Payment clause.



514.201-6  Solicitation provisions.

    (a) The contracting officer shall insert the provision at 552.214-
73, ``All or None'' Offers, in solicitations when all or none offers are 
considered. Alternate I should be used in requirements or indefinite 
quantity contracts.This provision must not be included in solicitations 
when the Government requires the bidder to submit bids on all items and 
will make only one award.
    (b) The contracting officer may include the notice at 552.214-74, 
Solicitation Copies, in solicitations when it is necessary to reduce 
costs of printing solicitations.



514.201-7  Contract clauses.

    (a) The contracting officer shall insert a clause substantially the 
same as the clause at 552.214-75, Progressive Awards and Monthly 
Quantity Allocations, in solicitations for stock replenishment contracts 
when it is determined that individual contractors may be unable to 
furnish the Government's monthly requirements and that it will be 
expedient to make progressive awards.
    (b) The contracting officer shall insert the clause at 552.215-70, 
Examination of Records by GSA, in solicitations and contracts that (1) 
involve the use or disposition of Government-furnished property, (2) 
provide for advance payments, progress payments based on

[[Page 336]]

cost, or guaranteed loans, (3) contain a price warranty or price 
reduction clause, (4) contain an economic price adjustment clause, (5) 
are requirements, indefinite quantity or letter type contracts as 
defined in FAR Part 16, or (6) contain the provision at FAR 52.223-4, 
Recovered Materials Certification. The contracting officer may modify 
the clause to define the specific area of audit (e.g., the 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.



514.201-70  GSA forms.

    The GSA Form 1602, Notice Concerning Solicitation, may be used to:
    (a) Describe the type of contract, the duration of the contract, and 
the type of supplies or services being procured;
    (b) Direct the attention of prospective offerors to special 
requirements which if overlooked, may result in rejection of the offer;
    (c) Highlight significant changes from previous solicitations 
covering the same supplies and services; and
    (d) Include other special notices as appropriate.
[61 FR 6167, Feb. 16, 1996]



514.201-71  Request for brand name information limitation.

    When an item is described in a solicitation by a formal 
specification or a detailed purchase description (other than a brand 
name or equal purchase description), the solicitation may not require or 
request that bidders specify the brand names of the products offered. 
However, brand name information may be requested when--
    (a) Descriptive literature for items is requested in accordance with 
FAR 14.202-5.
    (b) First article testing is required.
    (c) The procurement is for qualified products.



514.202  General rules for solicitation of bids.



514.202-4  Bid samples.

    (a) Solicitation requirements. (1) When a determination is made to 
require bidders to submit bid samples, the solicitation must include a 
provision incorporating the provision at FAR 52.214-20 and containing 
the information in FAR 14.202-4(e) and must require:
    (i) Samples be from the production of the manufacturer whose 
products will be furnished under the resultant contract; and
    (ii) Bidders use GSA Form 434, Sample Record Sheet, copies of which 
will be furnished with each solicitation.
    (2) If a determination is made that bidders will be permitted to 
reapply samples furnished under a previous solicitation, FAR 52.214-20, 
Alternate II, shall be used.
    (3) In addition to subjective characteristics of bid samples, 
objective characteristics may be used when it has been determined, on 
the basis of past experience or other valid considerations, that 
examination of such characteristics is necessary to determine the 
responsiveness of the bid. When both types of characteristics are listed 
in the solicitation, they must be listed separately under the headings 
``Subjective Characteristics'' and ``Objective Characteristics.''
    (4) Because of variations in circumstances and differences in 
commodities, no standard provision can be prescribed for use in all 
solicitations. The provision at 552.214-76, Bid Sample Requirements, is 
provided as an example and may be used in solicitations as shown or 
modified to fit the circumstances of the procurement.
    (b) Handling and disposition of samples. (1)(i) Samples held during 
the period of contract performance may be disposed of after deliveries 
are completed and Government acceptance has occurred, in accordance with 
the instructions indicated on GSA Form 434.
    (ii) If the contracting officer anticipates that there may be a 
future claim regarding a contract, the bid samples must be retained 
until the claim is resolved.
    (2) All other bid samples should be held until awards are made and 
then disposed of in accordance with instructions indicated on GSA Form 
434.



514.202-7  Facsimile bids.

    Contracting officers may authorize facsimile bids (see FAR 14.201-
6(w))

[[Page 337]]

after considering factors outlined in FAR 14.202-7, provided that 
facsimile equipment is available in the office designated to receive 
bids, and procedures and controls have been established for receiving 
and safeguarding incoming bids.
[55 FR 20458, May 17, 1990]



514.203  Methods of soliciting bids.



514.203-1  Transmittal to prospective bidders.

    (a) Prospective bidders, as used in FAR 14.203-1, include the 
incumbent contractor (except when its written response to the 
contracting activity's notice of contract action under FAR subpart 5.2 
states a negative interest) and should include bidders that responded to 
recent solicitations for the same or similar items. Names should be 
checked against the bidders' mailing list and added if not already 
listed.
    (b) Contracting officers shall ensure that all amendments to 
solicitations and related notices are furnished promptly to every 
addressee previously furnished a solicitation.
[54 FR 26514, June 23, 1989, as amended at 56 FR 47005, Sept. 17, 1991; 
60 FR 42803, Aug. 17, 1995]



514.204  Records of invitations for bids and records of bids.

    The contracting officer shall obtain from the Business Service 
Center (BSC) and include in the file the names and addresses of firms to 
whom the BSC furnished solicitations. Contracting officers shall furnish 
these firms with applicable amendments or supply the BSC with amendments 
for distribution.



514.205  Solicitation mailing lists.



514.205-1  Establishment of lists.

    (a) Contracting officers within the Federal Supply Service (FSS) 
should use the computerized central solicitation mailing list maintained 
by Region 7 for supplies and services for all procurements expected to 
exceed the simplified acquisition threshold. Other GSA contracting 
activities may maintain local lists. Contracting activities that 
maintain local mailing lists must inform the BSC of the list and provide 
related information regarding the list.
    (b) Inquiries from or for business firms requesting inclusion on 
solicitation mailing lists should be referred to the BSC serving the 
geographic areas in which the firms are located. The BSC will assist 
firms to be included on the proper GSA mailing lists and will provide 
application forms and related information.
[54 FR 26514, June 23, 1989, as amended at 60 FR 42803, Aug. 17, 1995]



514.211  Release of acquisition information.

    Before award, access to information concerning the Government cost 
estimate is limited to Government personnel whose official duties 
require knowledge of the estimate. After award, the total amount of the 
Government estimate may be revealed, upon request. The basis for 
calculating the estimate may not be released at any time.



514.213  Annual submission of representations and certifications.

    The Commissioners of the Federal Supply Service, Information 
Resources Management Service, and the Public Buildings Service may 
establish procedures for contracting activities in their respective 
organizations and assign responsibility within contracting activities 
for centrally requesting, receiving, storing, verifying and updating 
offerors' annual submissions.
[55 FR 20458, May 17, 1990]



514.270  Bid acceptance period.

    (a) The 60-day period stipulated in the parenthetical statement in 
Item 12 of the Standard Form 33, Solicitation, Offer and Award, is 
neither a ``standard'' nor a request to bidders to allow such period.
    (b) The contracting officer may specify a different minimum bid 
acceptance period and/or permit a bidder to insert a number of calendar 
days after bid opening, during which its bid is valid.
    (c) When specifying a minimum bid acceptance period, the contracting 
officer shall:
    (1) Insert in solicitations the provision at 552.214-16, Minimum Bid 
Acceptance Period, instead of the provision at FAR 52.214-16, and

[[Page 338]]

    (2) Mark Item 12 of SF 33 as follows to preclude a bidder from 
inadvertently rendering its bid nonresponsive by inserting a figure less 
than that stipulated by the Government in 552.214-16(c).

    Note:  Item 12 does not apply if the solicitation includes the 
provisions at 52.214.16, Minimum Bid Acceptance Period.

    12. In compliance with the above, the undersigned agrees, if this 
offer is accepted within N/A* calendar days (60 calendar days unless a 
different period is inserted by the offeror) from the date for receipt 
of offers specified above, to furnish any or all items upon which prices 
are offered at the price set opposite each item, delivered at the 
designated points(s), within the time specified in the schedule. *See 
Provision 552.214-16.



514.271  Aggregate awards.



514.271-1  General.

    (a) Definition. ``Aggregate award'' means an arrangement, stipulated 
by the Government in the solicitation, whereby two or more separately-
priced line items are combined for award to that bidder whose offer will 
result in the lowest overall cost to the Government for all of the line 
items within the group, without regard to whether the prices offered by 
the bidder are low on each item within the group. (See also the 
definition of a ``line item'' in FAR 3.302.)
    (b) Justification for use. (1) While ordinarily prices are solicited 
on an individual line item basis, it sometimes may be in the 
Government's best interest to combine two or more line items for an 
aggregate award such as when--
    (i) Uniformity of design, style, and finish is desired, as in the 
acquisition of suites of household furniture;
    (ii) The articles being acquired will be assembled and used as a 
unit, and may not be interchangeable if acquired from different 
manufacturers;
    (iii) The demand for certain articles is large, but the demand for 
other similar articles is not sufficient to attract competitive bids 
unless awarded in conjunction with the high-demand articles (e.g., 
various sizes of socket wrenches);
    (iv) One location (delivery point) has a large requirement, and 
another location has a requirement that is too small to individually 
attract competitive bids; or
    (v) It is impractical to award and administer numerous small 
contracts for similar articles or services.
    (2) Before deciding to combine items for aggregate award, the 
contracting officer shall include in the contract file the rationale for 
establishing an aggregate award formula, which must:
    (i) Address the capability of bidders to furnish the types and 
quantities of supplies or services in the aggregate as well as the 
impact on bidders if different delivery points are grouped; and
    (ii) Be capable of accurately projecting the lowest overall cost to 
the Government.
    (3) Line items may not be grouped for award on an aggregate basis 
when it would:
    (i) Preclude a significant number of firms from bidding due to an 
inability to provide all the types or quantities of supplies or services 
or to make deliveries to the various delivery points included in the 
prospective aggregate group; or
    (ii) Increase overall prices to the Government by restricting 
significantly the number of eligible bidders for any other reason (see 
also 514.271-3).
    (4) To determine the lowest cost on an aggregate group of items, it 
is necessary to extend unit prices by accurate weight factors calculated 
to reflect the true or proportionate quantities that will be purchased 
under a resultant contract (see 514.271-2). If weight factors must be 
based upon unreliable or conjectural information, or where reliable 
estimates on anticipated quantities are not available, the price list 
method described in 514.272 should be considered.
    (5) If accurate weight factors and pre-established list prices are 
not available, an aggregate award formula should not be used because it 
could result in unbalanced bids and/or award could not be assured to 
result in the lowest overall cost to the Government.
    (c) Evaluation factors for award. When items will be awarded on an 
aggregate basis, the solicitation must clearly state the basis on which 
bids will be evaluated.
    (1) If weight factors are used, bidders shall be required to submit 
a price on

[[Page 339]]

each item within the group with award to be made to the responsive and 
responsible bidder whose computed overall price for the aggregate group 
of items is actually the lowest or can accurately be projected to result 
in the lowest overall cost to the Government. Failure to submit a price 
on each item within a group will make the bid ineligible for award with 
regard to that group of items.
    (2) If the price method is used, bidders shall be required to 
express prices as a percentage to be added to or subtracted from the 
list price for each group of items with award to be made to the 
responsive and responsible bidder whose percentage factor produces the 
most favorable price to the Government.



514.271-2  Weighting of items for aggregate award.

    (a) Unless the same weight factor is applicable to all line items in 
the aggregate group, accurate weight factors are essential for 
determining which bid would result in the lowest overall cost to the 
Government for the aggregate group.
    (b) While the phrase ``lowest overall cost to the Government'' is 
used in this regulation, it is not always necessary that an aggregate 
award formula be capable of projecting actual cost. It is sufficient if 
the relative proportionate cost between line items within the aggregate 
group can be projected accurately, i.e., actual quantities may not be 
available, but ratios of the requirements within the line items in the 
aggregate group are available.
    (c) Estimated quantities that apply to indefinite quantity or 
requirements contracts may be reduced to smaller numbers by a common 
denominator to facilitate the computations involved in evaluating bids, 
if doing so does not sacrifice precision.
    (d) Actual purchase quantities will be used as weight factors for 
definite quantity acquisitions because a bidder might include two or 
more aggregate groups, or an aggregate group and various individual line 
items, under an ``all or none'' qualification. Proportionate weight 
factors must not be used in the evaluation process where ``all or none'' 
qualifications are permitted.
    (e) Weight factors may not be based on the estimated dollar value of 
purchases. If the dollar value of previous purchases is the only 
information available, and there is no recourse but to make award on an 
aggregate basis, the value of previous purchases must be converted to 
quantities for the purpose of establishing weight factors (i.e., divide 
total purchases of each item by the unit price to determine number of 
units purchased).



514.271-3  Grouping of line items for aggregate award.

    (a) General. While paragraphs (b) and (c) pertain to supply 
contracts (articles and delivery points), the same principles apply to 
service contracts (types of services and service areas).
    (b) Grouping of different articles. Only related articles, normally 
manufactured or produced by a majority of prospective bidders, should be 
included in an aggregate group. The grouping of unrelated articles 
usually is contrary to 514.271-1(b)(3).
    (c) Grouping of geographic locations or delivery point. The 
contracting officer should consider the following guidelines before 
deciding to group different geographic locations or delivery points for 
aggregate award:
    (1) If different delivery points have sufficient requirements so 
that individual shipments to each point will involve not only economic 
production runs, but carload or truckload quantities, these points 
should be listed as separate line items.
    (2) The types of bidders (i.e., small or large firms, manufacturers 
or distributors, etc.) responding to previous solicitations are an 
important consideration. For example, if previous bidders are 
distributors having franchises within certain territories, the grouping 
of different territories would tend to restrict competition.
    (3) The impact of transportation costs on competition and pricing, 
since transportation costs may constitute a significant portion of the 
total delivered cost. Depending upon the supplies being acquired:
    (i) Grouping widespread geographic locations or delivery points may 
reduce

[[Page 340]]

competition and/or result in higher prices due to the loss of ``area 
pricing'' advantages when a potential supplier has a single production 
point.
    (ii) Conversely, for many smaller commercial items (hand tools, 
locks, etc.) manufacturers may quote the same price for delivery 
anywhere in the U.S.
    (iii) Contracting officers should obtain the advice and assistance 
of transportation specialists before grouping geographic locations or 
delivery points, to include information regarding the location of tariff 
boundaries.



514.272  Price list method.

    (a) General. The price list method may be used to avoid unbalanced 
bidding in requirements and indefinite quantity/indefinite delivery 
contracts when aggregate awards will be made and accurate estimates of 
anticipated quantities are unavailable. This method utilizes pre-
established list prices for acquiring groups of similar items, services, 
or repairs and alterations. The following elements of the price list 
method must be included in the solicitation:
    (1) A pre-established price list.
    (2) An estimate of requirements, if available.
    (3) A requirement that a bidder express its price as ``net'' or as a 
percentage added to or subtracted from the list prices for each group.
    (4) The percentage factor in (a)(3) of this section is a price 
related factor, which must be identified in Section M of the Uniform 
Contract Format.
    (b) Development of pre-established list prices. (1) Pre-established 
list prices may be developed by one or more of the following methods:
    (i) Industry published prices.
    (ii) Industry surveys.
    (iii) Government cost estimates based upon knowledge of the supplies 
or services to be grouped and previous contract prices.
    (2) When proposed list prices will be used for the first time, 
prospective bidders should be given an opportunity to review the 
proposed list and furnished information on how the list prices will be 
used. Copies of the draft solicitation may be provided.
    (3) The contracting officer must ensure that items are properly 
grouped and that the list prices for the grouped items bear a reasonable 
and balanced relationship to one another. Before using prices resulting 
from awards made under the weighted item method to develop price lists, 
those prices must be reviewed to ensure that they did not result from 
unbalanced bidding.



514.272-1  Supply contracts.

    (a) Estimated requirements for each item in a group or for the 
entire group must be shown in the solicitation. For contracts for store 
stock items, estimated quantities should be shown only if estimates of 
demand for each item within a group can be derived from Government 
records (or verified contractor sales reports). All the estimates must 
be current. If the Government's needs cannot be estimated, the 
solicitation may include past orders. (See CG Decision, B-209037, 82-2 
CPD para 323 (1982).)
    (b) The bidding schedule must clearly state that bidders must quote 
only one percentage factor for each group, which must be expressed as 
either ``net'' or as a deduction from or an addition to the listed 
prices.
    (c) The following illustrates a bidding schedule arrangement for a 
group of items for aggregate award under the price list method:

    Drills, Twist, High Speed, under Federal Specification (dated 
________) and Amendment ________ (dated ________), Wire gauge sizes, 
straight shank, shortlength, Type C:

                                                                                                                
----------------------------------------------------------------------------------------------------------------
                                                               Drill        Est.                           List 
             Item No.                  National stock No.       size      quantity          Unit          price 
----------------------------------------------------------------------------------------------------------------
                                           Group 1 (Items 1 through 5)                                          
                                                                                                                
----------------------------------------------------------------------------------------------------------------
1.................................         5133-00-189-9246          1        2,800  Package              $11.16
2.................................         5133-00-189-9247          2        2,400  Package               11.16
3.................................         5133-00-189-9248          3        2,800  Package               10.44
4.................................         5133-00-189-9249          4        1,600  Package               10.80
5.................................         5133-00-189-9250          5        2,000  Package               10.80
                                                                                                                

[[Page 341]]

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

    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.)



514.272-2  Repair and alteration contracts.

    (a) The solicitation shall:
    (1) Contain a statement indicating the percentage of work 
anticipated to be performed during normal working hours;
    (2) Define ``normal'' in terms of hours and days of the week; and
    (3) List the quantities, if available, and unit prices for work 
performed during both normal working hours and outside of normal working 
hours.
    (b) Instructions, conditions, and notices to bidders. (1)(i) Bidders 
should be advised of the previous year's total expenditures or portions 
of that total attributable to the listed items.
    (ii) When estimates are provided, the solicitation must state that 
the quantity estimates are furnished for information only and are not to 
be construed as guarantees or commitments to order items under the 
contract.
    (2) Bidders shall be instructed to quote two or more percentage 
factors to be applied as specified in (b)(2) (i) and (ii), of this 
section. The percentage factor(s) must be expressed as ``net,'' or as an 
addition to or subtraction from the applicable unit prices.
    (i) For the line item unit prices listed in the solicitation, two 
percentage factors must be solicited: one to be applied to the unit 
prices for the percentage of work performed during normal working hours 
and the second to be applied to the unit prices for the percentage of 
work performed outside of normal working hours.
    (ii) When unit prices are further grouped by trade or business 
category, multiple percentages may be required.
    (c) Evaluation factors for award. (1) When two percentage factors 
are solicited under (b)(2)(ii) of this section, the evaluated bid price 
is the sum of the percentage of work performed--
    (i) During normal work hours multiplied by the Government's total 
estimate adjusted by the bidder's percentage factor for that portion of 
the work, and
    (ii) During other than normal working hours multiplied by the 
Government's total estimate adjusted by the bidder's percentage factor 
for that portion of the work.
    (2) Award must be made to the responsible and responsive bidder 
submitting the lowest evaluated bid price.
    (3) When additional evaluation factors such as options are used, 
they must be identified in the solicitation.



                    Subpart 514.3--Submission of Bids



514.301  Responsiveness of bids.



514.303  Modification or withdrawal of bids.

    (a) When a telegraphic modification or withdrawal of a bid is 
received by telephone under the circumstances in FAR 14.303, the 
identity of the telegraph office employee telephoning the message should 
be obtained and recorded in the solicitation file.
    (b) The receipt required by FAR 14.303(b) for withdrawal of a bid in 
person should be worded as follows:

    I certify as a bona fide, agent for or representative of (Bidder's 
name and address), I am authorized to withdraw the bid on IFB No. 
____________ scheduled for opening on ____________ and hereby 
acknowledge receipt of the unopened bid.
 _______________________________________________________________________
(Name and telephone no.)
 _______________________________________________________________________
(Date)



514.304  Late bids, late modifications of bids, or late withdrawal of bids.



514.304-1  General.

    Upon receipt of a late bid, the bid custodian should record it on 
the duplicate copy of the list of bidders and immediately notify the 
responsible contracting officer that the bid has been received. The 
contracting officer will arrange for the bid to be picked up or 
delivered.



514.370  Copies of bids required in submission.

    Bids must be submitted in an original and at least one copy. The 
original will be used by the contracting activity for the tabulation of 
bids. The copy will be retained by the BSC for public information until 
the bid abstract is

[[Page 342]]

available to replace it. Supplemental financial forms or other 
information submitted with a bid, must be retained by the contracting 
activity and must not be retained by the BSC for public information. 
These requirements do not apply to bids transmitted and received through 
an electronic commerce method authorized by the solicitation.
[54 FR 26514, June 23, 1989, as amended at 60 FR 42803, Aug. 17, 1995]



          Subpart 514.4--Opening of Bids and Award of Contract



514.401  Receipt and safeguarding of bids.

    (a) Except as otherwise provided in paragraph (c), bids and 
modifications must be received and safeguarded by the appropriate BSC 
until the time specified for opening. Bids received should be handled as 
follows:
    (1) At the initial point of receipt, each envelope (or other 
covering) received by mail and identified as containing a bid should be 
immediately time-stamped or indicated thereon the place, date, and time 
of receipt by authorized personnel. Then the bid(s) should be delivered 
by special handling to the bid custodian in the Business Service Center.
    (2) Mailed bids and modifications delivered to the bid custodian 
before bid opening time should be recorded on the bidder's list on the 
same day they are delivered and then placed in a suitable locked 
cabinet.
    (3) Hand-carried bids delivered before bid opening time should be 
deposited in the locked bid box. In the event a hand-carried bid is not 
placed in the bid box by the bidder, but is handed to the bid custodian 
or other GSA employee, it should be time stamped immediately and then 
handled in the same manner as provided for mailed bids. At least once 
daily (and immediately preceding the time for each scheduled bid 
opening), the bid custodian should remove and time stamp the bids, 
record them and place them with any other bids previously received.
    (4) Telegraphic or facsimile bid, if authorized, and modifications 
must be sealed in envelopes immediately upon receipt, appropriately 
identified, and handled in the same manner as bids submitted by mail.
    (5) For each invitation, the bid custodian will prepare a list 
indicating the invitation number and listing on the GSA Form 1378, 
Record of, and Receipt for, Bids and Responses, or the appropriate bid 
abstract form, the name and address of all responses, including any bid 
modification, received before bid opening time. When a bid previously 
recorded on this list is withdrawn, the list will so indicate.
    (b) At the scheduled bid opening time, the bid custodian will 
deliver all bids received in response to the invitation, together with 
the original and one copy of the GSA Form 1378, Record of, and Receipt 
for, Bids and Responses, or other appropriate bid list to the authorized 
bid opening official or designee, who will acknowledge receipt of the 
bids by signing the duplicate copy of the form and returning it to the 
bid custodian. The original list becomes part of the contract file.
    (c) Business Service Center Directors may designate an individual(s) 
working at a PBS Facility Support Center or Enhanced Field Office as a 
bid custodian, provided: (1) Adequate space and facilities are available 
within the Facility Support Center or Enhanced Field Office, (2) the 
individual(s) has been trained and (3) the Facility Support Center or 
Enhanced Field Office has a Small Business Technical Advisor. If such 
designations are made, the designated bid custodian must submit monthly 
reports to the BSC Director for forwarding to the Office of Small and 
Disadvantaged Business Utilization (AU).



514.402  Opening of bids.



514.402-1  Unclassified bids.

    (a) Public bid openings will be held in the BSC when the BSC is the 
bid custodian. When the bid opening will be held elsewhere, the 
contracting officer shall inform the BSC serving the geographic area in 
which the contracting office is located of the invitation number and the 
location where the public bid opening will be held.
    (b) The assistant bid opening officer shall be a qualified employee 
of the contracting office. Upon authorization

[[Page 343]]

by the HCA and the Associate Administrator for Enterprise Development in 
Central Office or the Director of the Business Service Center in the 
region, bids may be opened by selected BSC personnel. Normally, this 
authorization will be requested only when the geographic distance 
separating the BSC where bids are to be delivered and the contracting 
office makes it impracticable for the bid opening officer or designee to 
be present to open bids. (See FAR 14.402-1(b).)
    (c) Bid openings are open to business representatives, members of 
the press, and the general public.
    (d) To ensure that bids will be opened at the exact time specified, 
the bid opening official will verify the accuracy of the timepiece to be 
used.
    (e) For the information of those bidders present, approximately one-
minute prior notice of bid opening will be announced audibly by the bid 
opening official.
    (f)(1) The bid opening official shall take precaution to ensure that 
the exact time of opening has arrived and shall announce this fact 
audibly, citing the invitation or invitations scheduled for opening. The 
opening of bids will then proceed in full view of the parties present.
    (2) For construction contracts that provide for bid alternates, the 
amount of funds available for the award will be announced before opening 
bids.
    (g) In reading bids, the following information from each bid should 
be announced when considered practicable and feasible: The bidder's 
name, item and unit price bid, and other pertinent information, such as 
delivery and discount terms. A copy of each bid submitted in multiple 
copies should remain in the bid opening room until the bid abstract is 
substituted. For bids submitted in an original only see FAR 14.402-1(c).
    (h) No alterations or notations to any bid after it has been 
formally opened will be permitted.
    (i) Negotiable instruments submitted as bid guarantees to meet 
solicitation requirements must be forwarded by the bid opening official 
to the Finance Division in accordance with procedures established by the 
Chief Financial Officer. When award is made, the solicitation is 
cancelled, or all bids are rejected, the contracting officer shall 
direct the Finance Division to refund the amount of the bid guarantee to 
the unsuccessful bidder(s). Bid guarantees may be returned before award 
when a bidder requests the guarantee be returned and the bidder is not 
in contention for the award. Other forms of bid guarantees (e.g., bid 
bonds, letters of credit, corporate and individual sureties, etc.), must 
be retained by the contracting officer and included in the contract 
file.
    (j) A record, including at least the names of persons attending the 
bid opening and the firms or organizations they represent, should be 
made a part of the solicitation file.
    (k) When multiple copies of bids are received, the bid opening 
official shall verify the entries on all copies. If there is a 
discrepancy between the copies of a bid, the contracting officer shall 
direct the bidder's attention to the suspected mistake and shall follow 
the procedures set forth in FAR 14.406 concerning mistakes in bids.
    (l) Envelopes in which bids and bid modifications are received 
should be retained in a temporary file until after all awards have been 
made. At that time, those which bear notations concerning abnormal 
receipt or opening for identification should be made a part of the 
solicitation file and the remainder may be destroyed.
[54 FR 26514, June 23, 1989, as amended at 58 FR 52443, Oct. 8, 1993; 60 
FR 42803, Aug. 17, 1995]



514.403  Recording of bids.

    (a) A copy of the abstract of bids and any amendments must be 
furnished to the appropriate BSC as soon as practicable and be available 
for public examination for at least 30 calendar days. Late bids 
determined eligible for consideration must be included on the bid 
abstract form. If eligibility is established after delivery of the 
original tabulation, the bids are recorded separately and identified as 
an amendment to the original tabulation.
    (b) Abstracts involving aggregate awards must record unit prices, 
weight factors and aggregate totals for each aggregate group in addition 
to any

[[Page 344]]

other information required for bid evaluation.
    (c) For building services, the GSA Form 3471, Abstract of Offers, is 
authorized for use by contracting activities in the Public Buildings 
Service (PBS) instead of the Standard Form 1409, Abstract of Offers.



514.404  Rejection of bids.



514.404-1  Cancellation of invitations after opening.

    (a) Cancellation of invitations. The HCA or a designee makes any 
determinations  required  by  FAR  14.404-1.
    (b) Extension of time for bid acceptance. Requests for time 
extensions may be made using GSA Form 2981 and must specify a period 
reasonable under the circumstances.
[54 FR 26514, June 23, 1989, as amended at 58 FR 52443, Oct. 8, 1993]



514.404-2  Rejection of individual bids.

    (a) Individual bids rejected on the basis of responsiveness, 
responsibility, or eligibility and bids rejected because the bid after 
evaluation is no longer low shall be documented as provided in FAR 
14.404-2(k) and noted in the ``Remarks'' block on GSA Form 1535, 
Recommendation for Award(s). Examples of bids which may no longer be low 
after evaluation include aggregate bids (see 514.271), ``all or none'' 
bids (see 552.214-73), and bids evaluated using Buy American 
differentials (see FAR 25.105 and 525.105-70).
    (b) Explanations which involve cases of a sensitive or controversial 
nature must be accompanied by all supporting documentation to justify 
awards, such as copies of the offer to be rejected and the proposed 
awardee, statements from (or record of conversation with) the 
requisitioning activity, plant facilities and/or financial 
responsibility reports, and other relevant correspondence or reports 
(Certificates of Competency, copies of Congressional correspondence or 
other high level interest, etc.).
[54 FR 26514, June 23, 1989, as amended at 56 FR 47005, Sept. 17, 1991]



514.405  Minor informalities or irregularities in bids.

    Failure to submit all of the pages of the solicitation is a minor 
informality or irregularity under FAR 14.405 when the bid as submitted 
indicates that the bidder takes no exception to the requirements of the 
solicitation and intends to be bound by all its terms in any resultant 
contract.



514.407  Mistakes in bids.



514.407-3  Other mistakes disclosed before award.

    (a) Delegations of authority by head of the agency. In accordance 
with FAR 14.407-3(e), the contracting directors (see 502.101) are 
authorized, without power of redelegation, to make the determinations 
regarding corrections and/or withdrawals treated in FAR 14.407-3(a), 
(b), and (c), and to make the corollary determinations not to permit 
withdrawal or correction for reasons indicated in 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.
[60 FR 42804, Aug. 17, 1995]



514.407-4  Mistakes after award.

    Determinations by the contracting officer must be prepared in the 
format at 514.406-3(b) and reviewed and approved by the Contracting 
Director and assigned counsel.
[54 FR 26514, June 23, 1989. Redesignated at 60 FR 42804, Aug. 17, 1995]



514.407-7  Documentation of award.

    Documentation included in the contract file must include the number 
of firms solicited and the GSA Form 1535, Recommendation for Award(s), 
or similar document (see also 514.404-2).



514.408  Award.



514.408-1  General.

    (a) Oral notices of award shall not be used.
    (b) In addition to the requirements in FAR 14.408-1(c)(5), notice of 
award must identify the solicitation, the item(s) awarded, the contract 
number, and the effective date of the award.
    (c) If partial award is made to a bidder and additional items are 
being withheld for possible subsequent award to the same bidder, any 
subsequent

[[Page 345]]

award during the bid acceptance period must be made using SF-30, 
Amendment of Solicitation/Modification of Contract (except see 519.503-
4(b) regarding partial set-asides). The authority cited in paragraph 13D 
of SF-30 for the subsequent award will be FAR 14.408-1(c)(4).
[54 FR 26514, June 23, 1989. Redesignated and amended at 60 FR 42803, 
Aug. 17, 1995; 60 FR 44387, Aug. 25, 1995; 60 FR 54957, Oct. 27, 1995]



514.408-6  Equal low bids.

    In resolving a tie-bid situation, the status of the bidders (small/
large/labor surplus area) on the date the bid was signed is controlling.
[54 FR 26514, June 23, 1989. Redesignated at 60 FR 42803, Aug. 17, 1995]



514.408-70  Preaward inquiries.

    (a) Responses to preaward inquiries should be limited to a statement 
that the award decision is pending and agency policy prohibits release 
of additional information.
    (b) Actions or discussions that may create false impressions in the 
eyes of prospective contractors about pending awards must be avoided.
[54 FR 26514, June 23, 1989. Redesignated at 60 FR 42803, Aug. 17, 1995]



514.408-71  Awards involving related cases referred to higher authority.

    When a case is to be or has been referred to higher authority for 
review, any action which might prejudice the freedom of the higher 
authority to act on that case must be avoided. This includes partial 
awards to the same bidder under the same solicitation.
[54 FR 26514, June 23, 1989. Redesignated at 60 FR 42803, Aug. 17, 1995]



514.408-72  Forms for recommending award(s) (Supplies and services).

    GSA Form 1535, Recommendation for Award(s), and GSA Form 1535-A, 
Recommendation for Award(s), Continuation Sheet, must be used to 
document all proposed awards (except construction contracts) exceeding 
the simplified acquisition threshold. The use of the form for awards at 
or below the simplified acquisition threshold is at the discretion of 
the contracting activity. One or more awards may be set forth on each 
form. All information pertinent to the recommendation must be furnished 
on the form. The checklist on the back of the form must be completed.
[60 FR 42803, Aug. 17, 1995]



514.409  Information to bidders.



514.409-1  Award of unclassified contracts.

    The GSA Form 3577, Notification of Contract Award, may be used to 
notify all  unsuccessful  bidders  other  than  (a)  any  apparent  low  
bidder(s)  or  (b) unsuccessful bidders from designated countries for 
acquisitions subject to the Trade Agreements Act.
[54 FR 26514, June 23, 1989. Redesignated at 60 FR 42803, Aug. 17, 1995]



514.409-70  Restriction on disclosure of inspection or test data.

    Before award, no inspection or test data, whether prepared by the 
Government or an outside inspection or testing agency, shall be 
disclosed to anyone other than Government officials requiring access to 
such information in connection with bid evaluation. For requests 
received after award, see FAR 14.408-1(e).
[54 FR 26514, June 23, 1989. Redesignated at 60 FR 42803, Aug. 17, 1995]



514.471  Multiple bidding.

    (a) All bids received from a person, firm, or its affiliates must be 
considered for award if responsive and otherwise acceptable.
    (b) Any bid offering two or more products for the same item received 
from the same bidder may be accepted if it is the lowest received and 
meets all requirements of the solicitation.



PART 515--CONTRACTING BY NEGOTIATION--Table of Contents




           Subpart 515.1--General Requirements for Negotiation

Sec.
515.106  Contract clauses.
515.106-70  Examination of records by GSA clause.

[[Page 346]]

   Subpart 515.4--Solicitation and Receipt of Proposals and Quotations

515.402  General.
515.405  Solicitations for information or planning purposes.
515.405-1  General.
515.406  Preparing requests for proposals (RFP's) and requests for 
          quotations (RFQ's).
515.406-1  Uniform contract format.
515.408  Issuing solicitations.
515.411  Receipt of proposals and quotations.
515.411-70  Recording of offers.
515.414  Forms.
515.414-70  GSA forms.

                  Subpart 515.5--Unsolicited Proposals

515.501  Definitions.
515.504  Advance guidance.
515.506  Agency procedures.
515.506-2  Evaluation.

                     Subpart 515.6--Source Selection

515.608  Proposal evaluation.
515.608-70  Rejection of all proposals.
515.608-71  Discounts for prompt payment.
515.612  Formal source selection.

                    Subpart 515.8--Price Negotiation

515.803  General.
515.804  Cost or pricing data and information other than cost or pricing 
          data.
515.804-2  Requiring certified cost or pricing data.
515.804-3  [Reserved]
515.804-6  Instructions for submission of cost or pricing data or 
          information other than cost or pricing data.
515.805  Proposal analysis.
515.805-5  Field pricing support.

                          Subpart 515.9--Profit

515.902  Policy.
515.905  Profit-analysis factors.
515.905-1  Common factors.
515.905-70  Nonprofit organizations.

 Subpart 515.10--Preaward, Award, and Postaward Notifications, Protest, 
                              and Mistakes

515.1070  Release of information concerning unsuccessful offerors.

                   Subpart 515.70--Use of Bid Samples

515.7000  Scope of subpart.
515.7001  General.
515.7002  Policy.
515.7003  Procedural requirements.

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

    Source:  54 FR 26521, June 23, 1989, unless otherwise noted.



           Subpart 515.1--General Requirements for Negotiation



515.106  Contract clauses.



515.106-70  Examination of records by GSA clause.

    (a) The contracting officer shall insert the clause at 552.215-70, 
Examination of Records by GSA, in solicitations and contracts, other 
than multiple award schedule contracts, that
    (1) Involve the use and 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 that are under the control of the contractor,
    (5) Include an economic price adjustment clause,
    (6) Are requirements, indefinite-quantity, or letter type contracts 
as defined in FAR part 16,
    (7) Are subject to adjustment based on a negotiated cost escalation 
base, or
    (8) Contain the provision at FAR 52.223-4, Recovered Material 
Certification. The contracting officer may modify the clause 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.
    (b) The contracting officer shall insert the clause at 552.215-71, 
Examination of Records by GSA (Multiple Award Schedule), in 
solicitations and multiple award schedule contracts. With the Senior 
Procurement Executive's approval, the contracting officer may modify the 
clause to also 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/

[[Page 347]]

modification was accurate, current, and complete. Such a modification of 
the clause shall provide for the right of access to expire 2 years after 
award or modification. Before modifying the clause, the contracting 
officer shall 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. Such determinations must be 
made on a schedule-by-schedule basis.
[62 FR 44521, Aug. 21, 1997]



   Subpart 515.4--Solicitation and Receipt of Proposals and Quotations



515.402  General.

    Contracting officers may authorize facsimile proposals (see FAR 
15.407(j)) after considering the factors outlined in FAR 15.402(i), 
provided that facsimile equipment is available in the office designated 
to receive proposals, procedures and controls have been established for 
receiving and safeguarding incoming proposals.
[58 FR 52443, Oct. 8, 1993]



515.405  Solicitations for information or planning purposes.



515.405-1  General.

    Solicitations for information or planning purposes must be approved 
by the Chief of the Contracting Office (See 502.101).
[58 FR 52443, Oct. 8, 1993]



515.406  Preparing requests for proposals (RFP's) and requests for quotations (RFQ's).



515.406-1  Uniform contract format.

    (a) Leases of real property are exempted from the requirement for 
use of the uniform contract format.
    (b) All contracts, including leases of real property, must include 
the following notice:

    The information collection requirements contained in this 
solicitation/contract that are not required by regulation have been 
approved by the Office of Management and Budget pursuant to the 
Paperwork Reduction Act and assigned OMB Control No. 3090-0163.
[54 FR 26521, June 23, 1989, as amended at 57 FR 61584, Dec. 28, 1992]



515.408  Issuing solicitations.

    Potential sources, as used in FAR 15.403 and 15.408, include the 
incumbent contractor (except when its written response to the 
contracting activity's notice of contract action under FAR subpart 5.2 
states a negative interest) and should include offerors that responded 
to recent solicitations for the same or similar items.
[56 FR 47005, Sept. 17, 1991]



515.411  Receipt of proposals and quotations.

    (a) Solicitations should provide for proposals and modifications to 
proposals to be submitted to the appropriate contracting office unless 
arrangements have been made with the local Business Service Center (BSC) 
for receipt and safeguarding of proposals by the BSC.
    (b) Classified proposals and quotations must be handled under FAR 
15.411, GSAR subpart 504.4, and the requirements of GSA Order, Freedom 
of Information Act procedures (ADM 1035.11B).
[54 FR 26521, June 23, 1989, as amended at 56 FR 47005, Sept. 17, 1991]



515.411-70  Recording of offers.

    The GSA and/or Standard Forms prescribed for abstracting bids in 
sealed bidding may be used to abstract proposals or quotations submitted 
in connection with competitively negotiated procurements where more than 
one offer is received in response to the solicitation. (See FAR 
4.803(a)(10).) The forms may be appropriately modified to include all of 
the information necessary for evaluation. Abstracts must not be provided 
to the Business Service Center or disclosed except as provided in 
515.1070. See FAR 15.411, 15.413 and 15.1001 regarding disclosure of 
information.



515.414  Forms.

    If partial award is made to an offeror and additional items are 
being withheld for possible subsequent award to the same offeror, any 
subsequent award

[[Page 348]]

must be made using SF-30, Amendment of Solicitation/Modification of 
Contract (except see FAR 15.1002 regarding notification to the 
successful offeror and GSAR 519.502-3(b) regarding partial set-asides). 
The authority cited in paragraph 13D of SF-30 for subsequent awards will 
be GSAR 515.414.
[55 FR 48847, Nov. 23, 1990]



515.414-70  GSA forms.

    The GSA Form 1602, Notice Concerning Solicitation, may be used as 
prescribed in 48 CFR 514.201-70.
[61 FR 6167, Feb. 16, 1996]



                  Subpart 515.5--Unsolicited Proposals



515.501  Definitions.

    Coordinating office, as used in this subpart, means the (a) Office 
of GSA Acquisition Policy, (b) Office of Acquisition, FSS, (c) Office of 
Information Technology Acquisition, ITS, (d) Office of the Acquisition 
Executive, PBS, or the office designated in writing by the regional 
administrator in the regions. The Office of GSA Acquisition Policy 
serves as the coordinating office for Central Office activities outside 
of FSS, ITS, and PBS.
[60 FR 54956, Oct. 27, 1995]



515.504  Advance guidance.

    Potential offerors should be encouraged to make preliminary contacts 
with coordinating offices before submitting a detailed unsolicited 
proposal or proprietary data.



515.506  Agency procedures.

    Coordinating offices shall serve as contact points and establish 
procedures for controlling the receipt, evaluation, and timely 
disposition of proposals consistent with FAR 15.5.



515.506-2  Evaluation.

    The evaluation must be completed as soon as practicable (normally 
within 45 calendar days). The results of the evaluation should be 
communicated to the submitter with a copy to the coordinating office.



                     Subpart 515.6--Source Selection



515.608  Proposal evaluation.



515.608-70  Rejection of all proposals.

    HCA may reject all proposals received in response to a solicitation 
under FAR 15.608(b). This authority may be redelegated. Written 
documentation citing the reasons for rejecting proposals must be 
included in the contract file.



515.608-71  Discounts for prompt payment.

    The policy of not considering discounts in the evaluation of offers 
applies where there is direct competition between two or more offerors 
for a single award. It does not apply to procurements where the 
evaluation process involves a comparison of the offeror's price to the 
Government with the offeror's price to its other customers. Accordingly, 
the policy in FAR 14.407-3 does not apply to multiple award schedule 
solicitations except in those instances where offers are received on 
identical products. The clause at 552.232-8, Discounts for Prompt 
Payment, specifies the extent to which discounts for prompt payment will 
be considered in the evaluation for multiple award schedules. The 
formula for computing the annualized rate of return addressed in the 
clause at 552.232-8 is as follows:
[GRAPHIC] [TIFF OMITTED] TC13NO91.024

    *To determine the total number of days to the due date for payment, 
start with the date of the invoice and allow 3 days from the date of the 
invoice to receipt by the Government and assume that the invoice will be 
received after the supplies have been delivered and accepted by the 
Government. Normally, the contract will provide for payment in 30 days

[[Page 349]]

and the total number of days to the due date for payment will be 33 
days.



515.612  Formal source selection.

    After the source selection, the releasing authority under FAR 
15.612(e)(1) shall be the Contracting Officer. The contracting officer 
shall obtain the advice and concurrence of assigned legal counsel before 
releasing proprietary or source selection information outside the 
agency.
[55 FR 39974, Oct. 1, 1990]



                    Subpart 515.8--Price Negotiation



515.803  General.

    (a) Access to Government cost estimates is limited to Government 
personnel whose official duties require knowledge of the estimate. An 
exception to this rule may be made during contract negotiations to allow 
the contracting officer to identify a specialized task and disclose the 
associated cost breakdown figures in the Government estimate, but only 
to the extent necessary to arrive at a fair and reasonable price. After 
award, the total amount of the independent Government estimate may be 
revealed, upon written request, to those firms or individuals who 
submitted proposals.
    (b) Whenever a contractor insists on a price or demands a profit or 
fee that the contracting officer considers unreasonable as outlined in 
FAR 15.803(d) the contracting officer shall refer the matter to the 
contracting director for resolution.
[55 FR 48848, Nov. 23, 1990]



515.804  Cost or pricing data and information other than cost or pricing data.



515.804-2  Requiring certified cost or pricing data.

    When determining the contract amount for purposes of applying the 
threshold at FAR 15.804-2 for requesting certified cost and pricing 
data, the value of the contract plus any priced options must be 
considered. Exercise of a priced option is not considered a price 
adjustment and does not require submission of cost and pricing data.



515.804-3  [Reserved]



515.804-6  Instructions for submission of cost or pricing data or information other than cost or pricing data.

    (a) Contracting officers should use Alternate IV of the FAR 
provision at 52.215-41, Requirements for Cost or Pricing Data or 
Information Other Than Cost or Pricing Data, to provide the format for 
submission of information other than cost or pricing data for multiple 
award schedule (MAS) contracts. To provide for uniformity in requests 
under the MAS program, contracting officers 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 (Multiple Award Schedule);
    (2) Commercial sales practices. The Offeror shall submit information 
in the format provided in this solicitation in accordance with the 
instructions at Table 515-1 of the GSA Acquisition Regulation; 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 or other data 
relevant solely to the Offeror's determination of the prices to be 
offered in the catalog or marketplace.

    (b) Contracting officers shall insert the following format for 
commercial sales practices in the exhibits or attachments section of the 
solicitation (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

[[Page 350]]

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 begining 
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 most 
recent 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 Table 515-1 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. See definition of 
``concession'' and ``discount'' in 552.212-70.

                                                                                                                
----------------------------------------------------------------------------------------------------------------
                                                Column 3 quantity/                                              
  Column 1 Customer      Column 2 discount            volume           Column 4 FOB term    Column 5 concessions
----------------------------------------------------------------------------------------------------------------
                       .....................  .....................  .....................  ....................
                                                                                                                
----------------------------------------------------------------------------------------------------------------
                       .....................  .....................  .....................  ....................
                                                                                                                
----------------------------------------------------------------------------------------------------------------
                       .....................  .....................  .....................  ....................
                                                                                                                
----------------------------------------------------------------------------------------------------------------
                       .....................  .....................  .....................  ....................
                                                                                                                
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                       .....................  .....................  .....................  ....................
----------------------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------------

    (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, explain deviations in accordance with the 
instructions at Table 515-1 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/SIN offered, 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

[[Page 351]]

                             (End of Format)

    (c) The contracting officer should include the instructions for 
completing the commercial sales practices format in Table 515-1 in 
solicitations issued under the multiple award schedule program.

     TABLE 515-1--INSTRUCTIONS FOR COMMERCIAL SALES PRACTICES FORMAT

    If you responded ``YES'' to question (3), on the COMMERCIAL SALES 
PRACTICES FORMAT, 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 customer categories you will be aligned 
with the customer or category of customer that receives your best price 
for purposes of the Price Reduction clause at 552.238-76. 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 calendar 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 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 for 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 the discount. When purchases/orders must be 
placed 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 552.212-70 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

[[Page 352]]

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 
Practice 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.

    (d) The contracting officer shall insert the clause at 48 CFR 
552.215-72, Price Adjustment--Failure to Provide Accurate Information, 
in solicitations and contracts to be awarded under the multiple award 
schedule program.
    (e) The contracting officer should use Alternate IV of the FAR 
clause at 52.215-42, Requirements for Cost or Pricing Data or 
Information Other Than Cost or Pricing Data--Modifications, to provide 
for submission of information other than cost and pricing data for MAS 
contracts. To provide for uniformity in requests under the MAS program, 
the contracting officer 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, 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 Contractor's cost or profit information or other data 
relevant solely to the Contractor's determination of the prices to be 
offered in the catalog or marketplace.
[62 FR 44522, Aug. 21, 1997]



515.805  Proposal analysis.



515.805-5  Field pricing support.

    (a) ``Field pricing support'' is provided by the Assistant Inspector 
General-Auditing, or the Regional Inspector General-Auditing, as 
appropriate.
    (b) When applying the threshold at FAR 15.805-5 for requesting field 
pricing support, the value of the proposal (including any priced 
options) must be used.



                          Subpart 515.9--Profit



515.902  Policy.

    (a) Structured approach for determining profit fee objectives. The 
contracting officer's analysis of these profit factors is based on 
information available to the Government before negotiations. Such 
information is furnished in proposals, audit data, performance reports, 
preaward surveys and the like. The structured approach also provides a 
basis for documentation of a profit objective, including an explanation 
of any significant departure from this objective in reaching a final 
agreement. The extent of documentation should be directly related to the 
dollar value and complexity of the proposed procurement.
    (b) Exemptions from requirement to use the structured approach. (1) 
Under exempted procurements, other methods for establishing profit 
objectives may be used. Generally, such methods will be supported in a 
manner similar to that used in the structured approach (profit factor 
breakdown and documentation of profit objective). However, factors 
within the structured approach considered inapplicable to the 
procurement may be excluded from the profit objectives. The following 
types

[[Page 353]]

of procurements are exempt from the structured approach:
    (i) Management contracts for operation and/or maintenance of 
Government facilities;
    (ii) Contracts primarily requiring delivery of material supplied by 
subcontractors;
    (iii) Termination settlements;
    (iv) Cost-plus-award-fee contracts;
    (v) Contracts and contract modifications of $100,000 or less in 
value; and
    (vi) Architect-engineer and construction contracts.
    (2) Other exemptions may be made in the negotiation of contracts 
having unusual pricing situations where the structured approach is 
determined to be unsuitable. Such exemptions must be justified in 
writing and approved by the HCA.



515.905  Profit-analysis factors.

    (a) The following factors must be considered whenever profit is to 
be negotiated. The weight ranges listed after each factor should be used 
when the structured approach is used.

                                                                        
------------------------------------------------------------------------
              Profit factors                  Weight ranges in percent  
------------------------------------------------------------------------
Contractor Effort                                                       
Material acquisition......................  1 to 4.                     
Conversion direct labor...................  4 to 12.                    
Conversion related indirect cost..........  3 to 8.                     
                                            Other costs 1 to 3.         
                                            General management 4 to 8.  
Other Factors:                                                          
  Contract cost risk......................  0 to 7.                     
  Capital investment......................  -2 to +2.                   
  Cost-control and other past               -2 to +2.                   
   accomplishments.                                                     
  Federal socio economic programs.........  -.5 to +.5.                 
  Special situations and independent        -2 to +2.                   
   development.                                                         
------------------------------------------------------------------------

    (b) GSA Form 1766, Structured Approach Profit/Fee Objective, may be 
use to facilitate the profit objective computation. The contracting 
officer shall measure the Contractor Effort by the assignment of a 
profit percentage within the designated weight ranges to each element of 
cost recognized.
    (c) If the facilities capital cost of money is allowed as an item of 
cost, either as a part of the contracting officer's price/cost objective 
in a firm fixed price type contract or as an allowable cost in a 
flexibly priced type contract, e.g., cost reimbursement or fixed price 
incentive type contract, the contracting officer shall reduce the 
profit/fee objective as follows. After the contracting officer has 
developed a dollar profit/fee amount for the requirement (e.g., the sum 
of the ``contract effort'' and ``other factors'' dollar profit/fee 
amounts on the GSA Form 1766, Structured Approach Profit/Fee Objective), 
the contracting officer shall subtract from that aggregate dollar 
profit/fee amount any dollar amount allowed for facilities capital cost 
of money. The remainder, after subtraction of the facilities capital 
cost of money amount, is the profit/fee objective.
[54 FR 26521, June 23, 1989, as amended at 55 FR 48848, Nov. 23, 1990]



515.905-1  Common factors.

    (a) Contractor Effort encompasses broad and basic categories but 
shall not include facilities capital cost of money. Individual proposals 
may be in a different format.
    (b) After computing a total dollar profit for Contractor Effort, the 
contracting officer shall calculate the specific profit dollars for the 
categories under other factors. This is done by multiplying the total 
Government cost objective, exclusive of any cost of money for facilities 
capital, by the specific weights assigned to the elements within the 
Other Factors category.
    (c) In determining the value of each factor, the contracting officer 
should be governed by the definition, description, and purpose of the 
factors together with considerations for evaluating them as prescribed 
in FAR 15.905-1 and the following:
    (1) General management. 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 new program for an 
item that involves advanced state of the art techniques may cause more 
problems and require more managerial time and abilities of a higher 
order than one that is a follow-on contract. If new contracts create 
more problems and require a higher profit weight, follow-ons should be 
adjusted downward, as many of the problems should have been solved. An 
evaluation should be made of the underlying managerial effort involved 
on a case-by-case basis.

[[Page 354]]

    (2) Other-costs. Include all other direct costs of contractor 
performance under this item (e.g., travel and relocation, direct 
support, and consultants). Analysis of these costs in assigning profit 
weights must include (i) their significance, (ii) their nature, and 
(iii) how much they contribute to contract performance.
    (3) Contract-cost-risk. Where the proper contract type has been 
selected, the reward for risk by contract type would usually fall into 
the following ranges:

Cost-reimbursement type contracts...................................0-3%
Fixed-price type contracts..........................................3-7%

    (i) A cost-plus-a-fixed-fee contract normally would not justify a 
reward for risk in excess of 0 percent, unless the contract contains 
cost risk features such as ceilings on overheads. In such cases, up to 1 
percent may be justified. Cost-plus-incentive-fee contracts fill the 
remaining portion of the 0 to 3 percent range with weightings directly 
related to such factors as confidence in target cost, share ratio of 
fee(s), etc. The weight range for fixed-price contracts is wide enough 
to accommodate the many types of fixed-price arrangements. Weighting 
should indicate the cost risk assumed, with only firm fixed-price 
contracts reaching the top end of the range.
    (ii) The contractor's subcontracting program may significantly 
impact the contractor's risk under a contract. It could affect risk in 
terms of both cost and performance. This should be a part of the 
contracting officer's overall evaluation in selecting a weight for cost 
risk. The prime contractor may effectively transfer cost risk to a 
subcontractor and the risk evaluation may, as a result, be below the 
range that would otherwise apply for the contract type being proposed. 
The risk evaluation should not be lowered, however, merely because a 
substantial portion of the contract cost represents subcontracts without 
any substantial transfer of contractor's risk.
    (iii) In evaluating risk in the definitization of letter contracts, 
unpriced change orders, and unpriced orders under basic ordering 
agreements, the effect on risk as a result of partial performance before 
definitization should be considered. Under some circumstances the total 
risk may have been effectively reduced. Under other circumstances, the 
contractor's risk may have remained substantially unchanged. To be 
equitable, the determination of a profit weight for all recognized 
costs, both those incurred and those yet to be expended, must be made 
with consideration to all attendant circumstances, not just to the 
portion of costs incurred or percentage of work completed before 
definitization.
    (iv) Service contracts should have a weight range for cost risk of 0 
to 4 percent. A firm fixed-price contract, which is not priced on a 
labor-hour method, may warrant additional consideration for contractor 
cost risk. In those circumstances, a weight of up to 4 percent is 
authorized. Conversely, a cost-plus-a-fixed-fee service contract 
normally warrants a zero cost risk factor.
    (4) Capital investment. The evaluation of this factor for profit 
weights should include the following:
    (i) Facilities. To evaluate how this factor contributes to the 
profit objective requires knowledge of the level of facilities use 
needed for contract performance, the source of financing of the 
facilities, and the overall cost effectiveness of the facilities 
offered. Contractors who furnish their own facilities that significantly 
contribute to lower total contract costs, should receive additional 
profit. Contractors who rely on the Government to provide or finance 
facilities should receive less profit. Situations between the above 
examples should be evaluated on their merits with either a positive or 
negative profit weight adjustment, as appropriate, being made. However, 
when a contractor who owns a large quantity of facilities is to perform 
a contract that does not benefit from these facilities, or where a 
contractor's use of its facilities has a minimum cost impact on the 
contract, profit need not be adjusted.
    (ii) Payments. The frequency of payments by the Government to the 
contractor should be considered. The key to this weighting is the impact 
the contract will have on the contractor's cash flow. Generally, for 
payments more frequent than monthly, negative consideration should be 
given, with

[[Page 355]]

maximum reduction as the contractor's working capital approaches zero. 
Positive consideration should be given for payments less frequent than 
monthly with additional consideration given for payments less frequent 
than the contractor's or the industry's normal practice.
    (5) Cost control and other past accomplishments. See FAR 15.905-
1(e).
    (6) Federal socio economic programs. See FAR 15.905-1(c).
    (7) Special situations and independent development. See FAR 15.905-
1(f).
[54 FR 26521, June 23, 1989, as amended at 55 FR 48848, Nov. 23, 1990]



515.905-70  Nonprofit organizations.

    (a) The structured approach was designed for arriving at profit or 
fee objectives for other than nonprofit organizations. However, the 
structured approach as modified below, should also be used to establish 
fee objectives for nonprofit organizations. (See FAR 31.701.) The 
modifications should not be applied as deductions to historical fee 
levels, but rather, as a reduction in the fee objective calculated under 
the structured approach.
    (b) For contracts with nonprofit organizations, an adjustment of up 
to 3 percent will be subtracted from the total profit-fee objective. In 
developing this adjustment, it will be necessary to consider the 
following factors:
    (1) tax position benefits;
    (2) granting of financing through letters of credit;
    (3) facility requirements of the nonprofit organization; and
    (4) other factors that may work to the advantage or disadvantage of 
the contractor as a nonprofit organization.



Subpart 515.10--Preaward, Award, and Postaward Notifications, Protests, 
                              and Mistakes



515.1070  Release of information concerning unsuccessful offerors.

    (a) GSA Order, GSA Freedom of Information Act (FOIA) procedures (ADM 
1035.11B), should be consulted to determine what information may be 
disclosed.
    (b) When simplified acquisition procedures are used, the names and 
dollar amounts of unsuccessful offerors may be released upon request 
without processing through the formal FOI procedures.
    (c) When the contracting officer determines, in connection with 
negotiated procurements (other than purchases made using simplified 
acquisition procedures), that the administrative time and workload of 
processing regular FOIA requests (see FAR 14.408-1(c)) is greater than 
the workload involved in preparing an abstract of offers to be displayed 
at an appropriate Business Service Center, the following rules apply:
    (1) An abstract of offers may be prepared for display after award in 
the appropriate Business Service Center in addition to the notification 
required by FAR Subpart 15.10.
    (2) The abstract must include only the names, addresses, and ``best 
and final'' prices offered for unclassified acquisitions where the award 
is based on price and price-related factors. The successful offeror(s) 
must be identified.
    (3) Abstracts must not contain information regarding failure to meet 
minimum standards of responsibility or other notations properly exempt 
from disclosure under FOI regulations.
    (d) The information outlined in paragraph (c) of this section must 
not be disclosed when the contracting officer determines, on a case-by-
case basis, that it is not in the best interest of the Government or 
when it may be competitively harmful to offerors such as when 
negotiations are in process for an item that was recently awarded under 
another solicitation.
[54 FR 26514, June 23, 1989, as amended at 56 FR 47005, Sept. 17, 1991; 
60 FR 42804, Aug. 17, 1995]



                   Subpart 515.70--Use of Bid Samples



515.7000  Scope of subpart.

    This subpart supplements the policies and procedures in FAR 14.202-4 
and 514.202-4 regarding bid samples required in negotiated acquisitions.

[[Page 356]]



515.7001  General.

    Except as provided in 515.7002 and 515.7003, the basic policy and 
procedures in FAR 14.202-4 and 514.202-4 apply to negotiated 
acquisitions. When referring to FAR 14.202-4 and 514.202-4, the term 
``bid'' means ``offer'' or ``proposal'' and the terms ``bidder'' and 
``invitation'' or ``invitation for bids'' are used synonymously with 
``offeror'' and ``solicitation'' or ``RFP'' when contracting by 
negotiation.



515.7002  Policy.

    (a) Since the terms ``responsiveness'' and ``nonresponsive'' do not 
apply to negotiated acquisitions, FAR 14.202-4(b) (2) and (4) do not 
apply when the use of bid samples is determined necessary under this 
subpart.
    (b) Instead of FAR 14.202-4(b) (2) and (4), apply the following:
    (1) Bid samples will be used in the technical evaluation of 
proposals to determine the acceptability of the samples to meet the 
Government's specification and to ensure compliance with the subjective 
and any objective characteristics listed in the solicitation.
    (2) A proposal may be excluded from further consideration for award 
if after discussion with the offeror of any deficiencies found in the 
samples and after the offeror has been given an opportunity to correct 
those deficiencies, the sample still fails to conform to each of the 
characteristics listed in the solicitation. (See FAR 15.609.)



515.7003  Procedural requirements.

    (a) Unsolicited samples. The reference to FAR 14.404-2(d) in FAR 
14.202-4(g) is not applicable and the following is to be applied when 
contracting by negotiation:

    Qualifications in the proposal that are at variance with the 
Government's requirements are deficiencies and must be resolved as 
provided for in FAR 15.610.

    (b) Solicitation requirements. (1) When the clause at FAR 52.214-20 
is used in a negotiated acquisition, the second sentence in paragraph 
(c) of the clause does not apply. A sentence substantially as follows 
must be substituted in the clause when contracting by negotiation.

    Failure of the bid samples to conform to all of the required 
characteristics listed in the solicitation shall constitute a deficiency 
in the proposal and shall be resolved as provided for in FAR 15.610.

    (2) In addition to listing subjective characteristics that cannot be 
adequately described in the specification, objective characteristics may 
be listed in the solicitation and evaluated when it has been determined, 
on the basis of past experience or other valid considerations, that 
examination of such characteristics is essential to the acquisition of 
an acceptable product.
    (c) Samples received after the time set for receipt of offers may be 
considered only if they meet the requirements of FAR 52.215-10.



PART 516--TYPES OF CONTRACTS--Table of Contents




                  Subpart 516.2--Fixed-Price Contracts

Sec.
516.203  Fixed-price contracts with economic price adjustment.
516.203-4  Contract clauses.
516.203-70  EPA in FSS multiple award schedules.

                   Subpart 516.4--Incentive Contracts

516.405  Contract clauses.

              Subpart 516.5--Indefinite-Delivery Contracts

516.505  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. 486(c).

    Source:  54 FR 26526, June 23, 1989, unless otherwise noted.



                  Subpart 516.2--Fixed-Price Contracts



516.203  Fixed-price contracts with economic price adjustment.



516.203-4  Contract clauses.

    (a) General. When the contracting officer decides to use a clause 
providing for adjustments based on cost indexes of labor or material 
under FAR 16.203-4, a clause must be prepared with the

[[Page 357]]

assistance of counsel and approved by the contracting director.
    (b) FSS Multiple Award Schedules. In Federal Supply Service (FSS) 
multiple award schedule (MAS) procurements, the contracting director 
will determine whether to use an Economic Price Adjustment (EPA) clause 
under FAR 16.203-2.
    (c) Stock or Special Order Program Contracts. (1) The contracting 
officer shall insert the clause at 552.216-72, Economic Price 
Adjustment--Stock and Special Order Program Contracts, or a clause 
prepared as authorized in subparagraph (c)(2) of this section, in 
solicitations and contracts when the contracting officer has made the 
determination required by FAR 16.203-2 and the contract is a multiyear 
contract. If the contract includes one or more options to extend the 
term of the contract, the contracting officer shall use the clause with 
its Alternate I. If a multiyear contract with additional option periods 
is contemplated, the contracting officer may use a clause substantially 
the same as the clause at 552.216-72 with its Alternate I suitably 
modified. If the contract requires a minimum adjustment before the price 
adjustment mechanism is effectuated, the contracting officer shall use 
the basic clause or the Alternate I clause along with Alternate II.
    (2) If the contracting officer decides that an economic price 
adjustment clause is needed but finds the Producer Price Index is not an 
appropriate indicator for price adjustment, the contracting officer may 
modify the clause to use an alternate indicator for adjusting prices. 
Similarly, if the contracting officer finds other aspects of the clause 
at 552.216-72 are not appropriate, the contracting officer may develop a 
clause in accordance with 516.203-4(a) for use instead of the clause at 
552.216-72.
[55 FR 39278, Sept. 26, 1990]



516.203-70  EPA in FSS multiple award schedules.

    (a) If the FSS multiple award schedule solicitation contains an EPA 
clause, the contracting officer should establish negotiation objectives 
reflecting the terms of the clause and seek appropriate discounts. If 
the clause is not included in the initial solicitation but is negotiated 
in, it must be added to the contracts at the time of award. Its 
inclusion is contingent on the approval of the contracting director, the 
need for an EPA clause, and the concessions granted by the offeror for 
its inclusion in the contract.
    (b) The contract price ceiling may be raised during the contract 
period only under the following conditions:
    (1) Analysis of the current market conditions, conducted in 
conjunction with the Office of Commodity Management (FC), reveals that 
the original contract price ceiling is inadequate.
    (2) The causes which require an increase in the price ceiling are 
not unique to an individual contractor, but affect all suppliers for 
similar products.
    (3) The HCA approves the determination to raise the ceiling.



                   Subpart 516.4--Incentive Contracts



516.405  Contract clauses.

    Award fee clauses developed by contracting officers, under FAR 
16.405(e), shall be prepared with the advice and assistance of counsel 
and be approved by the contracting director.



              Subpart 516.5--Indefinite-Delivery Contracts



516.505  Contract clauses.

    (a) The contracting officer shall insert the clause at 552.216-73, 
Placement of Order, in solicitations and contracts for stock or special 
order program items when the contract authorizes FSS and other agencies 
to issue delivery orders. If only FSS will issue delivery orders under 
any of its supply programs, use Alternate I. If a Federal Supply 
Schedule contract (single or multiple award) permits other agencies to 
issue delivery orders, use Alternate II.
    (b) The contracting officer shall insert the provision at 552.216-
74, Ordering Information, in solicitations for stock items and in other 
Federal Supply Service solicitations when the clause at 552.216-73 is 
prescribed. Insert 552.216-74 Alternate I when 552.216-73

[[Page 358]]

Alternate I is prescribed. Insert 552.216-74 Alternate II when 
552.216.73 Alternate II is prescribed.
[59 FR 32384, June 23, 1994]



   Subpart 516.6--Time-and-Material, Labor-Hour, and Letter Contracts



516.603  Letter contracts.



516.603-3  Limitations.

    (a) When acquiring architect-engineer (A-E) services the proposed A-
E must provide a price proposal for the non-design effort to be 
performed under the contract before the letter contract is awarded. The 
letter contract must:
    (1) Not authorize the A-E to begin the design effort. The scope of 
the letter contract may include the design effort but the letter 
contract may only authorize the A-E to perform those services that are 
independent of the design effort (e.g., feasibility studies, existing 
facility surveys or site investigation, etc.) before the letter contract 
is definitized.
    (2) Include a definitization schedule that outlines dates for 
submission of the design fee proposal, start of negotiations, and 
definitization. The schedule must provide for definitization of the 
contract within 90 days after the date of the letter contract instead of 
180 days as outlined in FAR 16.603-2(c).
    (3) Limit the Government's liability to the amount necessary for the 
non-design effort to be performed under the contract by inserting that 
amount in the clause at FAR 52.216-24, Limitation of Government 
Liability.
    (b) If the contracting officer must issue a unilateral price 
decision for an A-E contract under FAR 16.603-2(c), the maximum contract 
amount must not exceed a reasonable price for the excludable items plus 
the 6 percent statutory fee limitation for the project.



PART 517--SPECIAL CONTRACTING METHODS--Table of Contents




                  Subpart 517.1--Multiyear Contracting

Sec.
517.105  Solicitation provisions and clauses.

                         Subpart 517.2--Options

517.200  Scope of subpart.
517.202  Use of options.
517.203  Solicitations.
517.204  Contracts.
517.207  Exercise of options.
517.208  Solicitation provisions and contract clauses.

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

    Source:  54 FR 26527, June 23, 1989, unless otherwise noted.



                  Subpart 517.1--Multiyear Contracting



517.105  Solicitation provisions and contract clauses.

    Inclusion of FAR clauses 52.217-1, Limitations of Price and 
Contractor Obligations, and 52.217-2, Cancellation of Items, is not 
required for multiyear contracts authorized by the Federal Property and 
Administrative Services Act for maintenance and repair of fixed 
equipment in Federally-owned buildings and utility services.



                         Subpart 517.2--Options



517.200  Scope of subpart.

    This subpart prescribes policies and procedures for the use and 
exercise of options. When a requirement in this subpart is inconsistent 
with FAR 17.2, this subpart takes precedence. When a requirement of this 
subpart is inconsistent with GSAR 536.6, the latter subpart takes 
precedence. A class deviation from the FAR has been approved to 
implement GSA's Quality Contractor Program. This subpart applies to 
contracts including those for (a) services involving the construction, 
alteration, or repair (including dredging, excavating, and painting) of 
buildings, bridges, roads, or other kinds of real property; (b) 
architect-engineer services; (c) automatic data processing (ADP) 
equipment and systems; and (d) telecommunications equipment and 
services.
[57 FR 59939, Dec. 17, 1992]



517.202  Use of options.

    (a) The inclusion of options in contracts under appropriate 
circumstances is encouraged. The use of options may

[[Page 359]]

reduce procurement lead time and associated costs, ensure continuity of 
contract support, improve overall contractor performance, and facilitate 
longer term contractual relationships with those contractors that 
continuously meet or exceed quality performance expectations outlined in 
the contract.
    (b) Inclusion of an option is normally in the Government's interest 
where--
    (1) Additional supplies or services may be required during the 
contract term;
    (2) Additional supplies or services may be required beyond the 
initial contract term and either multiyear contracting authority is not 
available or its use is inappropriate;
    (3) There is a need for continuity of supply or services support;
    (4) Funds are not available for the entirety of the Government's 
needs, but are likely to become available during the contract term; or
    (5) The contract is with an emerging small business with minimal 
performance history in the contract supply or service and the basic 
quantity is intended to be a learning or testing quantity.
    (c) Inclusion of an option may not be appropriate where the 
circumstances described in FAR 17.202(b)(2) and 17.202(c) (1) and (3) 
exist or where the market prices for the supplies or services are likely 
to change substantially and an economic price adjustment clause will not 
adequately protect the Government's interests.
[57 FR 59939, Dec. 17, 1992]



517.203  Solicitations.

    Solicitations containing options to extend (see FAR 17.208 (f) and 
(g)) should normally inform offerors of the potential for entering into 
a long term contractual relationship with the GSA subject to a 
continuing need and the successful offeror's ability to perform at 
levels which meet or exceed the agency's quality performance 
expectations.
[57 FR 59939, Dec. 17, 1992]



517.204  Contracts.

    The head of the contracting activity must approve exceeding the 5-
year limitations specified in FAR 17.204(e) for individual contracts. 
The Associate Administrator for Acquisition Policy must approve requests 
to exceed the limitations for classes of contracts. The contract file 
for individual approvals and the requests for approval of classes of 
contracts must support the need to exceed the 5-year limitation. This 
section does not apply to contracts for automatic data processing (ADP) 
equipment and systems or to contracts for telecommunications equipment 
and services.
[57 FR 59939, Dec. 17, 1992]



517.207  Exercise of options.

    (a) If the option was not evaluated as part of the original 
competition, a synopsis of the option before it is exercised is required 
unless exempt under FAR 5.202.
    (b) In addition to the items listed in FAR 17.207(d), the 
contracting officer may consider whether the contractor's performance 
under the contract has met or exceeded the Government's expectation for 
quality performance, or whether another circumstance exists that would 
warrant an extended contractual relationship when deciding whether to 
exercise an option. The contracting officer must always determine the 
option price(s) is fair and reasonable before exercising an option.
[57 FR 59939, Dec. 17, 1992]



517.208  Solicitation provisions and contract clauses.

    (a) In addition to other applicable provisions or clauses related to 
options, the contracting officer shall insert a provision substantially 
the same as the provision at 552.217-71, Notice Regarding Option(s), in 
solicitations for supplies or services when necessary to inform offerors 
of the importance GSA will place on past performance when considering 
whether to exercise options.
    (b) The contracting officer shall insert a provision substantially 
the same as the provision at 552.217-70, Evaluation of Options, in 
solicitations for procurements under the Federal Supply Service (FSS) 
stock or special order program when (1) the solicitation contains an 
option to extend the term of

[[Page 360]]

the contract and (2) a firm-fixed price contract with economic price 
adjustment based on the Producer Price Index or alternative indicator of 
market price changes is contemplated.
[57 FR 59939, Dec. 17, 1992]



PART 518 [RESERVED]




[[Page 361]]



                  SUBCHAPTER D--SOCIOECONOMIC PROGRAMS





PART 519--SMALL BUSINESS PROGRAMS--Table of Contents




Sec.
519.001  Definitions.

                         Subpart 519.2--Policies

519.201  General policy.
519.202  Specific policies.
519.202-2  Locating small business sources.

   Subpart 519.3--Determination of Status as a Small Business Concern

519.302  Protesting a small business representation.

              Subpart 519.5--Set-Asides for Small Business

519.500  Scope of subpart.
519.502  Setting aside acquisitions.
519.502-3  Partial set-asides.
519.502-70  Review of non-set-aside determinations.
519.503  Setting aside a class of acquisitions.
519.508  Solicitation provisions and contract clauses.

    Subpart 519.6--Certificates of Competency and Determinations of 
                               Eligibility

519.602  Procedures.
519.602-3  Resolving differences between the agency and Small Business 
          Administration.

 Subpart 519.7--Subcontracting With Small Business, Small Disadvantaged 
            Business and Women-Owned Small Business Concerns

519.705  Responsibilities of the contracting officer under the 
          subcontracting assistance program.
519.705-2  Determining the need for a subcontracting plan.
519.708  Solicitation provisions and contract clauses.

 Subpart 519.8--Contracting With the Small Business Administration (The 
                              8(a) Program)

519.803  Selecting acquisitions for the 8(a) program.
519.803-70  Contracting officer evaluation of recommendations for 8(a) 
          set-aside(s).

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

    Source:  54 FR 26527, June 23, 1989, unless otherwise noted.



519.001  Definitions.

    Agency small business technical advisors (SBTAs) as used in this 
part, means the individuals designated in writing by the Office of 
Enterprise Development (E). In addition to the duties outlined at FAR 
19.201(c), the agency small business technical advisors perform the 
functions of the small business specialist described in FAR 19.506 (a) 
and (b) and 19.705-4(d)(5).
[61 FR 1150, Jan. 17, 1996]



                         Subpart 519.2--Policies



519.201  General policy.

    The Associate Administrator for Enterprise Development (E) may make 
recommendations to the contracting officer as to whether a particular 
acquisition should be awarded under FAR 19.5 as a set-aside or under FAR 
19.8 as a section 8(a) award directly or through the SBTA.
[61 FR 1150, Jan. 17, 1996]



519.202  Specific policies.



519.202-2  Locating small business sources.

    Contracting officers should request assistance from SBTAs in 
locating small business sources.
[61 FR 1151, Jan. 17, 1996]



   Subpart 519.3--Determination of Status as a Small Business Concern



519.302  Protesting a small business representation.

    If SBA determines that an offeror is not a small business and there 
is evidence that the offeror knowingly misrepresented itself as a small 
business, the contracting officer shall refer the matter to the 
Inspector General (J) for investigation.
[56 FR 3044, Jan. 28, 1991]

[[Page 362]]



              Subpart 519.5--Set-Asides for Small Business



519.500  Scope of subpart.

    The requirements in this subpart for setting aside acquisitions and 
for reviewing non-set-aside determinations do not apply to construction, 
architectural and engineering, or trash/garbage collection services 
estimated to exceed $25,000 that are acquired under the Small Business 
Competitiveness Demonstration Program during periods when goals are 
being met and contracting officers are required to contract for such 
services using unrestricted procedures. (See FAR 19.10.) However, 
contracts for these services may be awarded under the 8(a) program.
[56 FR 3044, Jan. 28, 1991]



519.502  Setting aside acquisitions.



519.502-3  Partial set-asides.

    (a) Initiating partial set-asides for stock items. Partial set-
asides for procurement of stock items may be made when the following 
Economic Order Quantity (EOQ) factors are present:
    (1) For annual contracts, an EOQ factor not exceeding 3 months; and
    (2) For 6-month contracts, an EOQ factor not exceeding 1 month.
    (b) Contract award. When the set-aside portion of an item is awarded 
to the same concern as the corresponding non-set-aside portion, the 
award must be documented by issuing a separate contract or contract 
number for each group of items.
    (c) Partial coverage. When only the non-set-aside portion of the 
procurement is awarded before the expiration of the current contract, 
contractual documents covering the transaction must be distributed to 
the ordering activities to provide at least partial coverage of the 
requirements.
    (d) Contract coding. Information regarding partial or total set-
asides must be included on GSA Form 1535, Recommendation for Award(s), 
as appropriate. Further, if a class set-aside is involved, the face of 
the GSA Form 1535 must be annotated as follows: ``Class set-asides apply 
to items ________________.''
    (e) Ordering procedures. The Inventory Manager shall ensure that the 
specified division of orders is made in accordance with the clause at 
552.219-71 in those cases where two contractors are to supply the same 
item(s).



519.502-70  Review of non-set-aside determinations.

    (a) If the contracting officer decides that a procurement that is 
expected to exceed $100,000 cannot be set aside for small business, the 
reasons for the decision must be recorded on the GSA Form 2689, 
Procurement Not Set Aside. The GSA Form 2689 must be submitted to the 
SBTA for review and coordination with the SBA.
    (b) The SBTA will provide a copy of the GSA Form 2689 to the SBA 
representative as soon as possible so that the review can be made by GSA 
and SBA within the timeframe provided in (c) of this section.
    (c) Review of the contracting officer's determination should 
normally be completed within 5 workdays. GSA and SBA reviewing officials 
should notify the contracting officer if additional time is needed and 
request an extension of time to complete the review.
    (d) Before the GSA or SBA reviewing officials provide additional 
small business sources to the contracting officer when requesting 
reconsideration of the non-set-aside determination, the reviewing 
officials shall contact the sources to ensure the sources are interested 
in submitting offers and to obtain information regarding the capability 
of the sources to fulfill the Government's requirements. The information 
obtained should be provided to the contracting officer for 
consideration.
    (e) If the SBTA recommends that the contracting officer set the 
procurement aside and the contracting officer still believes the 
procurement should be unrestricted, the matter must be referred to the 
contracting director's first level supervisor for a decision.
    (f) If the SBA representative recommends that the contracting 
officer set the procurement aside and the contracting officer rejects 
the recommendation, the contracting officer shall comply with FAR 
19.505.
[54 FR 26527, June 23, 1989, as amended at 61 FR 1151, Jan. 17, 1996]

[[Page 363]]



519.503  Setting aside a class of acquisitions.

    (a) A class set-aside may consist of an item (or service), a group 
of related items under a Federal Supply Class (FSC), or a whole FSC when 
restricted to small business on more than a one-time basis, as distinct 
from a one-time basis. A single item or a group of items restricted to 
small business on more than a one time basis, even though constituting 
only a small portion of an FSC, is defined as a class set-aside.
    (b) Class set-aside determinations must be documented in the 
following format:

              Small Business Class Set-Aside Determination

    In accordance with FAR 19.502-2, it is hereby determined that 
procurements by the (name of contracting activity) of the following 
items or services will be set aside for small business concerns on a 
class basis. This determination does not apply to any individual 
procurement of $100,000 or less and applies only to the contracting 
activity named above.

                        (List items or services)

    The above format must be appropriately modified with respect to any 
class of procurements proposed to be partially set-aside. It must be 
signed by the contracting officer having procurement responsibility for 
the class of items or services involved, approved by the appropriate 
contracting director or a designee, and placed in the contract file.
[54 FR 26527, June 23, 1989, as amended at 61 FR 1151, Jan. 17, 1996]



519.508  Solicitation provisions and contract clauses.

    The contracting officer shall insert the clause at 552.219-71, 
Allocation of Orders--Partially Set-Aside Items, in solicitations and 
requirements type supply contracts that are partially set aside for 
small business.



    Subpart 519.6--Certificates of Competency and Determinations of 
                               Eligibility



519.602  Procedures.



519.602-3  Resolving differences between the agency and the Small Business Administration.

    (a) Within 5 working days or such longer period as may be agreed to 
after the contracting officer makes a request to the SBA Regional Office 
to appeal a notice of intention to issue a Certificate of Competency, 
the contracting office shall prepare and forward the following 
information to E:
    (1) Copies of all correspondence between GSA and SBA concerning the 
case, including initial notice to SBA that a small business had been 
found nonresponsible;
    (2) Copies of all technical documents sent to SBA along with the 
notice (i.e., solicitation, preaward surveys, abstract of offers, if 
any, etc.);
    (3) A fact sheet detailing all pertinent information to support an 
appeal action to SBA, including any new information and a justification 
of the contracting officer's decision to continue the appeal.
    (b) If the SBA Central Office informs the contracting officer that 
it concurs with its Regional Office's intention to issue a COC, the 
documentation available clearly supports an appeal, and the contracting 
officer believes an appeal to be in the Government's interest, the 
contracting officer shall contact E and request that office formally 
appeal the SBA decision on the agency's behalf. After considering all 
the facts and conferring with the applicable contracting activity, E 
will decide whether or not to file a formal appeal. Before a decision is 
made not to appeal, E shall notify the applicable Central Office 
Service. Once a decision is made regarding the appeal the contracting 
officer will be notified.
[54 FR 26527, June 23, 1989, as amended at 61 FR 1151, Jan. 17, 1996]

[[Page 364]]



 Subpart 519.7--Subcontracting With Small Business, Small Disadvantaged 
            Business and Women-Owned Small Business Concerns



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



519.705-2  Determining the need for a subcontracting plan.

    The requirement at FAR 19.702(a)(1) for submission of a 
subcontracting plan by only the apparently successful offeror does not 
apply to GSA negotiated solicitations when the contract is expected to 
exceed $500,000 ($1,000,000 for construction) and the contract will be 
awarded on the basis of an evaluation of technical and/or management 
proposals and cost or price proposals using source selection procedures. 
Except for acquisitions of commercial products, or offering minimal 
subcontracting opportunities, such acquisitions shall require submission 
of a subcontracting plan with the initial offer by all offerors that are 
not small business concerns.
[60 FR 42794, Aug. 17, 1995]



519.708  Solicitation provisions and contract clauses.

    (a) The contracting officer shall insert the provision at 552.219-
72, Notice to Offerors of Subcontracting Plan Requirements, on the cover 
page of the solicitation if the solicitation includes the clause at FAR 
52.219-9, Small, Small Disadvantaged and Women-Owned Small Business 
Subcontracting Plan.
    (b) The contracting officer shall insert the provision at 552.219-
73, Preparation, Submission, and Negotiation of Subcontracting Plans, in 
negotiated solicitations if the solicitation includes the clause at FAR 
52.219-9, Small, Small Disadvantaged and Women-Owned Small Business 
Subcontracting Plan, and the contract will be awarded on the basis of an 
evaluation of technical and/or management proposals and cost or price 
proposals using source selection procedures. The provision does not 
apply to (1) solicitations for commercial products, or (2) solicitations 
where, in the judgment of the contracting officer, subcontracting 
opportunities are minimal.
    (c) The contracting officer shall insert the provision at 552.219-
74, Goals for Subcontracting Plan, in sealed bid solicitations if the 
solicitation includes the clause at FAR 52.219-9, Small, Small 
Disadvantaged and Women-Owned Small Business Subcontracting Plan. The 
basic provision should be used when the contracting officer is able to 
realistically establish target goals. Alternate 1 should be used in 
sealed bid solicitations when the contracting officer cannot establish 
realistic target goals and in negotiated solicitations that include the 
clause at FAR 52.219-9 but do not include the provision at 552.219-73.
[61 FR 1151, Jan. 17, 1996]



 Subpart 519.8--Contracting With the Small Business Administration (The 
                              8(a) Program)



519.803  Selecting acquisitions for the 8(a) program.



519.803-70  Contracting officer evaluation of recommendations for 8(a) set-aside(s).

    If the Associate Administrator for Enterprise Development (E) or the 
SBTA recommends that a procurement be set aside for award under the 8(a) 
program and the contracting officer disagrees, the contracting officer 
shall discuss the matter with the official that made the recommendation 
before making a decision. If the contracting officer decides not to 
award the contract under the 8(a) program as recommended, the reasons 
for the decision must be documented for the record as required by FAR 
19.202 and a copy of the documentation must be forwarded to E within 10 
working days of the contracting officer's decision.
[61 FR 1151, Jan. 17, 1996]



PARTS 520-521 [RESERVED]






PART 522--APPLICATION OF LABOR LAWS TO GOVERNMENT ACQUISITIONS--Table of Contents




Sec.
522.000  Scope of part.

[[Page 365]]

522.001  Definition.

                   Subpart 522.1--Basic Labor Policies

522.101  Labor relations.
522.101-1  General.
522.101-3  Reporting labor disputes.
522.103  Overtime.
522.103-4  Approvals.
522.103-5  Contract clause.

       Subpart 522.3--Contract Work Hours and Safety Standards Act

522.302  Liquidated damages and overtime pay.

   Subpart 522.4--Labor Standards for Contracts Involving Construction

522.404  Davis-Bacon Act wage determination.
522.404-6  Modification of wage determinations.
522.406  Administration and enforcement.
522.406-1  Policy.
522.406-6  Payrolls and statements.
522.406-7  Compliance checking.
522.406-8  Investigations.
522.406-9  Withholding from or suspension of contract payments.
522.406-11  Contract terminations.
522.406-13  Semiannual enforcement reports.
522.470  Forms.

             Subpart 522.6--Walsh-Healy Public Contracts Act

522.608  Procedures.
522.608-2  Determination of eligibility.
522.608-3  Protests against eligibility.
522.608-4  Award pending final determination.
522.608-6  Postaward.

               Subpart 522.8--Equal Employment Opportunity

522.803  Responsibilities.
522.804  Affirmative action programs.
522.804-1  Nonconstruction.
522.804-70  Reports and other required information.
522.804-71  Furnishing information to contractors.
522.805  Procedures.
522.807  Exemptions.

              Subpart 522.10--Service Contract Act of 1965

522.1003  Applicability.
522.1003-3  Statutory exemptions.
522.1003-4  Administrative limitations, variations, tolerances, and 
          exemptions.
522.1003-7  Questions concerning applicability of the Act.
522.1005  Clause for contracts of $2,500 or less.
522.1006  Clauses for contracts over $2,500.
522.1011  Response to notice by Department of Labor.
522.1011-2  Requests for status or expediting of response.
522.1013  Review of wage determination.
522.1014  Delay of acquisition dates over 60 days.
522.1021  Substantial variance hearings.

        Subpart 522.13--Special Disabled and Vietnam Era Veterans

522.1303  Waivers.
522.1306  Complaint procedures.

              Subpart 522.14--Employment of the Handicapped

522.1403  Waivers.
522.1406  Complaint procedures.

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

    Source:  54 FR 26532, June 23, 1989, unless otherwise noted.



522.000  Scope of part.

    This part provides agency policies regarding contractor labor 
relations as they relate to the acquisition process; procedures for 
implementing requirements for FAR part 22; and it also precribes 
contract clauses for use in certain contracts.
[57 FR 7555, Mar. 3, 1992]



522.001  Definition.

    Agency labor advisor as used in this part means the Director of the 
Office of GSA Acquisition Policy.
[57 FR 7555, Mar. 3, 1992]



                   Subpart 522.1--Basic Labor Policies



522.101  Labor relations.



522.101-1  General.

    (a) In conjunction with the Office of General Counsel (OIG), the 
agency labor advisor:
    (1) Serves as the focal point on matters that relate to contractor 
labor relations;
    (2) Is responsible for initiating contact on labor relations matters 
with national offices of labor organizations, Government departments, 
agencies or other governmental organizations;

[[Page 366]]

    (3) Serves as a clearinghouse for information on labor laws 
applicable to Government acquisitions; and
    (4) Responds to questions involving FAR part 22, GSAR part 522 or 
other contractor labor relations matters that arise in connection with 
GSA acquisition programs. OGC is responsible for determining the 
agency's legal position with respect to these matters.
    (b) GSA personnel in discharge of their duties and consistent with 
FAR 22.101-1(b), shall refrain from involvement in or expressing a 
position on, labor negotiations between contractors and unions or on the 
merits of any dispute between labor and a contractor's management.
[57 FR 7556, Mar. 3, 1992]



522.101-3  Reporting labor disputes.

    Reports required by FAR 22.101-3 must be submitted to the agency 
labor advisor.
[57 FR 7556, Mar. 3, 1992]



522.103  Overtime.



522.103-4  Approvals.

    The head of the program office is the agency official responsible 
for approving overtime under FAR 22.103-4(a).



522.103-5  Contract clause.

    The contracting officer shall include the clause at FAR 52.222-1, 
Notice to the Government of Labor Disputes, in solicitations and 
contracts for items on the DoD Master Urgency List.
[57 FR 7556, Mar. 3, 1992]



       Subpart 522.3--Contract Work Hours and Safety Standards Act



522.302  Liquidated damages and overtime pay.

    (a) The Administrator has designated the Heads of Central Office 
Services to make determinations under FAR 22.302(c).
    (b) Upon a final administrative determination regarding the 
assessment of liquidated damages, the contracting officer notifies the 
appropriate Finance Office of the decision and provides necessary 
instructions regarding the disposition of funds withheld or the 
collection of funds. If funds were withheld from contract payments to 
satisfy the claim for liquidated damages pending a final administrative 
determination, the appropriate Finance Office shall be instructed to 
immediately release any funds in excess of the amount specified in the 
final administrative determination to the contractor. If funds were not 
withheld or if the amount of liquidated damages assessed exceeds that 
amount withheld for liquidated damages, the contracting officer 
initiates collection action by withholding funds from payments due on 
the instant contract or by issuing a demand for payment. When the 
contractor has other Government contracts the demand letter should 
indicate the Government's intent to offset if payment is not made. The 
contracting officer will provide the appropriate Finance Office with a 
copy of the demand for payment and request that the Finance Office 
initiate collection action under 41 CFR Part 105-55, Collection of 
Claims Owed the United States, if payment is not made in accordance with 
the demand letter.



   Subpart 522.4--Labor Standards for Contracts Involving Construction



522.404  Davis-Bacon Act wage determinations.



522.404-6  Modifications of wage determinations.

    Contracting directors may request extensions of the 90-day period 
for application of a general wage determination. See FAR 22.404-6(b)(6).



522.406  Administration and enforcement.



522.406-1  Policy.

    The GSA Form 618-A, Transmittal of Contract Award, may be used to 
inform contractors of their obligations under the labor standards 
clauses of the contract.



522.406-6  Payrolls and statements.

    Prime contractors and subcontractors who personally perform work are 
required to submit, instead of weekly payrolls and statements of 
compliance with respect to payment of wages, a

[[Page 367]]

statement clearly showing their contractual relationship, the scope and 
dates of work performed, that they received no wages, and that no 
mechanics or laborers were employed in the prosecution of the work. GSA 
Form 618-D, Statement to be Submitted When Work is Performed Personally, 
should be used to furnish this information.



522.406-7  Compliance checking.

    Compliance checks must be made as frequently as necessary and before 
final payment is made. Compliance checking is essential to the success 
of the labor standards enforcement program.



522.406-8  Investigations.

    (a) When compliance checks indicate such action is warranted, the 
contracting officer shall request the Regional Inspector General for 
Investigations to conduct an investigation of a contractor's compliance 
with the labor standards requirements.
    (b) The contracting director shall review and process the 
contracting officer's report under FAR 22.406-8(d).



522.406-9  Withholding from or suspension of contract payments.

    Upon final administrative determination regarding the assessment of 
liquidated damages, the contracting officer shall follow the procedures 
in 522.302(b).



522.406-11  Contract terminations.

    Contracting officers shall submit reports required under FAR 22.406-
11.



522.406-13  Semiannual enforcement reports.

    Contracting activities shall submit semiannual enforcement reports 
to the agency labor advisor (See 522.001) for consolidation and 
submission to the Department of Labor. The reports should be submitted 
within 15 calendar days after the end of the reporting period.
[57 FR 7556, Mar. 3, 1992]



522.470  Forms.

    GSA Form 3505, Labor Standards (Construction Contract), is for use 
in contracts subject to the Davis-Bacon and related Acts. The clauses on 
this form must be included in solicitations/contracts in full text, and 
may not be incorporated by reference.



            Subpart 522.6--Walsh-Healey Public Contracts Act



522.608  Procedures.



522.608-2  Determination of eligibility.

    The contracting officer shall forward ineligibility determinations 
under FAR 22.608-2(f)(1)(ii) through the contracting director.



522.608-3  Protests against eligibility.

    The contracting officer shall forward determinations under FAR 
22.608-3(b) through the contracting director.



522.608-4  Award pending final determination.

    The certification required by FAR 22.608-4(b)(1) must be approved by 
the HCA.



522.608-6  Postaward.

    The contracting officer shall notify and furnish information to the 
Department of Labor under FAR 22.608-6(c) after coordinating with legal 
counsel and the contracting director.



               Subpart 522.8--Equal Employment Opportunity



522.803  Responsibilities.

    The contracting officer shall submit questions under FAR 22.803(d) 
to legal counsel.



522.804  Affirmative action programs.



522.804-1  Nonconstruction.

    In addition to the requirements of FAR 22.804, each contractor and 
subcontractor who serves as a depository of Government funds in any 
amount, or is a financial institution which is an issuing and paying 
agent for U.S. savings bonds and savings notes in any amount, must 
develop a written affirmative action compliance program for each of its 
establishments within 120 days from the start of its first such 
Government contract or subcontract.

[[Page 368]]



522.804-70  Reports and other required information.

    For contract administration purposes, nonexempt contractors shall be 
instructed to submit a copy of Standard Form 100, Equal Employment 
Opportunity Employer Information Report EEO-1, submitted under the Equal 
Opportunity clause to the contracting officer (see FAR 52.222-26(b)(7)).



522.804-71  Furnishing information to contractors.

    Contracting officers shall provide contractors with (a) a SF-100, 
and (b) a copy of the notice that is to be provided the labor union or 
workers' representative and posted in conspicuous places (see FAR 
22.805(b) and 52.222.26(b) (3) and (5)).



522.805  Procedures.

    (a) The contract amount for purposes of applying the threshold at 
FAR 22.805(a) includes the value of the basic contract plus priced 
options. A contract modification exercising an option that has been 
priced and evaluated does not constitute a contract award under FAR 
22.805(a)(1)(ii) and does not require a preaward clearance.
    (b) Requests for reviews under FAR 22.805(a)(5) are made directly by 
the contracting officer.



522.807  Exemptions.

    Requests for exemption under FAR 22.807(c) must be submitted to 
OFCCP through the agency labor advisor.
[57 FR 7556, Mar. 3, 1992]



                  Subpart 522.10--Service Contract Act



522.1003  Applicability.



522.1003-3  Statutory exemptions.

    The statutory exemption in FAR 22.1003-3(c) does not apply to local 
office relocation moves when the transportation is incidental to the 
services being acquired. The Service Contract Act applies in such 
situations and formal contracting procedures must be used.
[55 FR 37880, Sept. 14, 1990]



522.1003-4  Administrative limitations, variations, tolerances, and exemptions.

    Requests for limitations, variations, tolerances, and exemptions 
from the Service Contract Act under FAR 22.1003-4(a) must be submitted 
to the Administrator, Wage and Hour Division, through the agency labor 
advisor. The contracting officer shall coordinate requests with assigned 
legal counsel and the contracting director before forwarding to the 
agency labor advisor.
[57 FR 7556, Mar. 3, 1992]



522.1003-7  Questions concerning applicability of the Act.

    Questions under FAR 22.1003-7 regarding the applicability of the Act 
may also be directed to assigned legal counsel. Unresolved questions 
shall be submitted to the Administrator, Wage and Hour Division through 
the agency labor advisor.
[57 FR 7556, Mar. 3, 1992]



522.1005  Clause for contracts of $2,500 or less.

    The total dollar amount of orders reasonably expected to be placed 
against blanket purchase or basic ordering agreements in a 1-year period 
should be used for comparison with the dollar threshold.



522.1006  Clauses for contracts over $2,500.

    The clauses prescribed in FAR 22.1006 (a) and (b) may be repeated 
verbatim in solicitations and contracts or the GSA Form 2166, Service 
Contract Act of 1965 (As Amended) and Statement of Equivalent Rates for 
Federal Hires, may be used.
[58 FR 47398, Sept. 9, 1993]



522.1011  Response to notice by Department of Labor.



522.1011-2  Requests for status or expediting of response.

    Requests to expedite wage determinations or to check the status of a 
request may be made by the contracting officer directly to the 
Administrator, Wage and Hour Division.
[55 FR 37880, Sept. 14, 1990]

[[Page 369]]



522.1013  Review of wage determination.

    In addition to contacting the agency labor advisor under FAR 
22.1013, the contracting officer shall consult with assigned legal 
counsel when considering instituting a request for a substantial 
variance hearing under FAR 22.1021.
[57 FR 7556, Mar. 3, 1992]



522.1014  Delay of acquisition dates over 60 days.

    Requests under FAR 22.1014 to determine whether the wage 
determinations issued under the initial submission are still current may 
be made by the contracting officer.
[57 FR 7556, Mar. 3, 1992]



522.1021  Substantial variance hearings.

    The contracting officer shall submit, after coordinating with 
assigned legal counsel, any request for a hearing under FAR 22.1013(a) 
through the agency labor advisor to the Administrator, Wage and Hour 
Division.
[57 FR 7556, Mar. 3, 1992]



        Subpart 522.13--Special Disabled and Vietnam Era Veterans



522.1303  Waivers.

    Requests for waivers under FAR 22.1303(c) must be submitted to the 
Administrator through the agency labor advisor.
[57 FR 7556, Mar. 3, 1992]



522.1306  Complaint procedures.

    The contracting officer may forward complaints about the 
administration of the Act to the Veteran's Employment Service in 
accordance with FAR 22.1306.



              Subpart 522.14--Employment of the Handicapped



522.1403  Waivers.

    Request for waivers under FAR 22.1403(c) must be submitted to the 
Administrator through the agency labor advisor.
[57 FR 7556, Mar. 3, 1992]



522.1406  Complaint procedures.

    The contracting officer may forward complaints about the 
administration of the Act to the OFCCP in accordance with FAR 22.1406.



PART 523--ENVIRONMENT, CONSERVATION, AND OCCUPATIONAL SAFETY--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:  54 FR 26534, June 23, 1989, unless otherwise noted.



 Subpart 523.3--Hazardous Materials Identification and Material Safety 
                                  Data



523.303  Contract clause.

    (a) The contracting officer shall insert the clause at 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) The contracting officer shall insert the clause at 552.223-72, 
Nonconforming Hazardous Materials, in solicitations and contracts 
requiring contractors to submit hazardous material data.
[56 FR 1740, Jan. 17, 1991]



523.370  Solicitation provision.

    The contracting officer shall insert the provision at 552.223-71, 
Hazardous Material Information, in solicitations including purchases 
made using simplified acquisition procedures, which involve the shipment 
of hazardous materials on an f.o.b. origin basis.
[60 FR 42804, Aug. 17, 1995]

[[Page 370]]



PART 524--PROTECTION OF PRIVACY AND FREEDOM OF INFORMATION--Table of Contents




             Subpart 524.1--Protection of Individual Privacy

Sec.
524.103  Procedures.

                Subpart 524.2--Freedom of Information Act

524.202  Policy.

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

    Source:  54 FR 26535, June 23, 1989, unless otherwise noted.



             Subpart 524.1--Protection of Individual Privacy



524.103  Procedures.

    See 41 CFR Part 105-64 and GSA Order, Privacy Act Program (OAD P 
1878.8) when contracting for the design, development, or operation of a 
system of records on individuals.



                Subpart 524.2--Freedom of Information Act



524.202  Policy.

    See 41 CFR part 105-60 and GSA Order, Freedom of Information Act 
procedures (ADM 1035.11B) for requirements on making records available 
under the Freedom of Information Act.
[56 FR 47006, Sept. 17, 1991]



PART 525--FOREIGN ACQUISITION--Table of Contents




                Subpart 525.1--Buy American Act--Supplies

Sec.
525.105  Evaluating offers.
525.105-70  Evaluating offers--hand or measuring tools or stainless 
          steel flatware for other than the Department of Defense (DOD).
525.105-71  Procurement of hand or measuring tools or stainless steel 
          flatware for DOD.
525.108  Excepted articles, materials, and supplies.
525.108-70  Determination of nonavailability.

         Subpart 525.2--Buy American Act--Construction Materials

525.202  Policy.
525.203  Evaluation of offers.
525.204  Violations.
525.205  Solicitation provision and contract clause.

               Subpart 525.3--Balance of Payments Program

525.302  Policy.
525.302-70  Procurements for agencies under the Foreign Assistance Act.
525.304  Excess and near-excess foreign currencies.
525.371  Restricted solicitation.

     Subpart 525.4--Purchases Under the Trade Agreements Act of 1979

525.402  Policy.
525.402-70  Delegation of limited waiver authority.
525.406  Agencies covered by the Agreement on Government Procurement.
525.407  Solicitation provision and contract clause.

          Subpart 525.9--Additional Foreign Acquisition Clauses

525.901  Omission of audit clause.

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

    Source:  54 FR 26535, June 23, 1989, unless otherwise noted.



                Subpart 525.1--Buy American Act--Supplies



525.105  Evaluating offers.

    (a) Proposed awards, under FAR 25.105(c), must be submitted to the 
HCA or a designee for approval. A statement of facts containing the 
following information should be submitted for approval.
    (1) Description of the item(s), including unit and quantity.
    (2) Estimated cost.
    (3) Statement as to whether duty is included in the estimated cost 
and, if not, the reasons for exclusion.
    (4) Transportation costs for delivery to destination if the item is 
to be procured f.o.b. origin.
    (5) Country of origin.
    (6) Name and address of proposed contractor(s).
    (7) Brief statement as to necessity for procurement.
    (8) Reasons supporting request for approval explaining.
    (i) Why the cost would not be unreasonable or inconsistent with the 
public

[[Page 371]]

interest when award to a domestic concern for more than $250,000 would 
be made to a small business or labor surplus area concern after the 12 
percent factor is applied, but not to a firm after the 6 percent is 
applied.
    (ii) Any proposed rejection of an acceptable low foreign offer to 
protect essential national security interests or rejection of any offer 
for other reasons of national interest when the Trade Agreements Act of 
1979 is not applicable.
    (b) A determination to reject a foreign offer using differentials 
greater than those provided at FAR 25.105 may be made.
    (1) If necessary to protect national security interests; and
    (2) After the HCA or a designee obtains advice from the Director, 
Federal Emergency Management Agency. The Executive Office of the 
President, Office of Management and Budget, must be apprised of the 
facts of each case where such a determination is made.



525.105-70  Evaluating offers--hand or measuring tools or stainless steel flatware for other than the Department of Defense (DOD).

    (a) Definitions. ``Hand or measuring tool,'' as used in this 
section, means Groups 51 and 52 in Cataloging Handbook H2-1, Federal 
Supply Classification Part I, Groups and Classes, published by the 
Defense Logistics Agency, Defense Logistics Services Center, Battle 
Creek, Michigan.
    (b) GSA Appropriation Act restrictions. (1) The current GSA 
Appropriation Act restricts the acquisition of any hand or measuring 
tool and stainless steel flatware to domestic end products, except to 
the extent the Administrator of General Services or a designee 
determines that a satisfactory quality and sufficient quantity are 
unavailable from sources in the United States or its possessions or 
except as prescribed by section 6-104.4(b) of the Armed Services 
Procurement Regulations (ASPR) in effect on June 15, 1970.
    (2) For hand or measuring tools, the GSA Appropriation Act further 
provides that a factor of 75 percent is to be used in evaluating foreign 
end products in lieu of the 50 percent in ASPR 6-104.4(b).
    (c) Evaluation procedures. Offers for hand or measuring tools or 
stainless steel flatware must be evaluated using the following 
procedures adapted from ASPR 6-104.4(b).
    (1) An offer of an end product manufactured in Canada will be 
evaluated on the same basis as a domestic end product after applicable 
duty, determined under 19 U.S.C. 1202, is included, irrespective of 
whether or not a duty-free entry certificate will be issued.
    (2) Any other offer of a foreign end product must be evaluated at 
the greatest evaluated price determined by increasing either (i) the net 
value of the offer (exclusive of duty) by 50 percent (75 percent for 
hand or measuring tools) or (ii) the gross value of the offer (inclusive 
of duty) by 6 percent.
    (3) A 12 percent factor must be used in (c)(2) (ii) above, when (i) 
a small business or any labor surplus area concern submits the low 
acceptable domestic offer or (ii) an otherwise low acceptable domestic 
offer would result in a contract not to exceed $100,000 based on its 
application, but not on the application of the factors in (c)(2) (i) and 
(ii).
    (4) If a contract exceeding $100,000 to a small business or labor 
surplus area concern would result under the circumstances in (c)(3)(ii), 
the matter must be submitted to the HCA for a decision whether such 
award would involve unreasonable cost or be inconsistent with the public 
interest. A statement of facts as outlined in 525.105 may be used.
    (5) The above evaluation must be applied on an item-by-item basis or 
to any group of items on which award may be made as specifically 
provided by the solicitation. Award on the domestic offer will be made 
when any tie results from the foregoing procedures.
    (d) Solicitation provision. The contracting officer shall insert the 
provision at 552.225-70, Buy American Act--Hand or Measuring Tools or 
Stainless Steel Flatware, in solicitations for the acquisition of hand 
or measuring tools or stainless steel flatware for other than Department 
of Defense requirements.

[[Page 372]]



525.105-71  Procurement of hand or measuring tools or stainless steel flatware for DOD.

    (a) Definitions. ``Domestic end product,'' as used in this section, 
means a hand or measuring tool, other than an electric or air-motor 
driven hand tool, or stainless steel flatware, that is wholly produced 
or manufactured, including all components, in the United States or its 
possessions.
    ``Electric or air-motor driven hand tool,'' as used in this section, 
means a domestic end product if the cost of components produced or 
manufactured in the United States exceeds 75 percent of the cost of all 
components in the end product.
    ``Stainless steel flatware,'' as used in this section, 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
7340-00-205-3341
7340-00-241-8169
7340-00-241-8170
7340-00-241-8171
7340-00-559-8357
7340-00-688-1055
7340-00-721-6316
7340-00-721-6971

    (b) DOD Appropriation Act restrictions. (1) Except for purchases of 
$25,000 or less, DOD is prohibited from acquiring hand or measuring 
tools or stainless steel flatware (see 525.105-71(a)), that are not 
domestic end products, except in the case of stainless steel flatware, 
when the Secretary of the department concerned determines that a 
satisfactory quality and quantity produced or manufactured in the United 
States or its possessions are not available when needed at domestic 
market prices.
    (2) In GSA procurements of such tools or flatware, a determination 
must be made by the appropriate Commodity Center Director whenever GSA 
applies the current DOD Appropriation Act restrictions. This 
determination must be made on a case-by-case basis for tools and 
flatware for NSNs other than those listed in 525.105-71(a), whenever (i) 
DOD requirements are included in the solicitation and (ii) the hand or 
measuring tools or stainless steel flatware are available from domestic 
sources.
    (3) The basis for applying the DOD Appropriation Act restrictions to 
GSA acquisitions is the--
    (i) Statutory prohibition on DOD, which applies when DOD 
requisitions such items, regardless of whether or not it is from the GSA 
stock program;
    (ii) Impracticality of establishing a dual supply system to satisfy 
the requirements of civilian and military agencies; and
    (iii) Language in the GSA Appropriation Act, which provides for the 
rejection of any offer when it is considered necessary for reasons of 
national interest under ASPR 6-104.4(d)(3)(ii).
    (4) When no offers for a domestic end product are received or the 
total quantity offered by responsive and responsible offerors for a 
particular NSN of stainless steel flatware is insufficient to meet the 
requirement, the contracting officer should consider making an 
unavailability determination (see 525.108-70), amend the solicitation, 
and complete the acquisition under 525.105-70.
    (c) Contract clause. The contracting officer shall insert the clause 
at 552.225-71, Notice of Procurement Restriction--Hand or Measuring 
Tools or Stainless Steel Flatware, in solicitations and contracts for 
the acquisition of hand or measuring tools or stainless steel flatware 
when the Commodity Center Director makes a determination under 525.105-
71(b).



525.108  Excepted articles, materials, and supplies.



525.108-70  Determination of nonavailability.

    (a) Determinations under FAR 25.102(a)(4), 25.202(a)(3), and 25.108 
must be supported by a statement of fact (findings), including the 
following information, and a determination signed by the HCA or a 
designee:
    (1) Description of the item(s), including unit and quantity;
    (2) Estimated cost, including duty, if any (show the amount of duty 
separately);
    (3) Transportation costs for delivery to destination, if item is to 
be procured f.o.b. origin;

[[Page 373]]

    (4) Country of origin;
    (5) Name and address of prospective contractor(s);
    (6) Brief statement as to the necessity for the procurement; and
    (7) Statement of effort made to procure a similar item of domestic 
origin or statement that there is no domestic item that can be used as a 
reasonable substitute.
    (b) Findings and determination of nonavailability will normally be 
prepared in the format shown below:

                     General Services Administration

 Reference No. _________________________________________________________

Findings and Determination of Nonavailability Under the Buy American Act 
               Regarding Purchase of (insert description)

    Pursuant to the provisions of the Buy American Act (41 U.S.C. 10a-d) 
and Executive Order 10582, December 17, 1954 (3 CFR Supp.), and by 
virtue of delegated authority, the following findings of fact and 
determination are hereby made:
    1. Findings (set forth a statement of facts).
    2. Determination. In view of the foregoing, it is hereby determined 
that for the purposes of the Buy American Act (insert item description), 
is not mined, produced, or manufactured at the present time in the 
United States in sufficient and reasonably available commercial 
quantities and of a satisfactory quality.
 Date __________________________________________________________________
Signed 

(End of Findings and Determination)

    (c) When it has been determined that the Buy American Act is not 
applicable to the purchase of the end product or to the components from 
which it is manufactured, the original of the determination must be made 
a part of the contract file and a copy furnished to the Associate 
Administrator for Acquisition Policy for transmittal to the appropriate 
FAR Council and a statement must be inserted in the solicitation and 
contract that a determination has been made pursuant to FAR 25.108(b).



         Subpart 525.2--Buy American Act--Construction Materials



525.202  Policy.

    The HCA is authorized to make determinations required by FAR 
25.202(a). The HCA may not redelegate authority to make determinations 
under FAR 25.202(a)(3) when the cost of the materials is estimated to 
exceed $100,000. Authority to make other determinations may be 
redelegated.



525.203  Evaluation of offers.

    (a) The HCA or a designee may authorize the use of a particular 
foreign construction material when the use of a comparable domestic 
construction material would unreasonably increase the cost of the 
contract. The cost of a particular domestic construction material shall 
be determined to be unreasonable when the cost of such material exceeds 
the cost of foreign material by more than 6 percent. The cost of 
construction material includes all delivery costs to the construction 
site and any applicable duty (whether or not a duty-free entry 
certificate is issued).
    (b) The evaluation process described in paragraph (a) of this 
section does not apply to:
    (1) Excepted materials listed in the solicitation; or
    (2) European Community (EC) and North American Free Trade Agreement 
(NAFTA) country construction materials offered in response to 
solicitations for construction contracts with an estimated value of 
$6,500,000 or more.
    (c) Offerors proposing to use foreign construction materials (other 
than EC or NAFTA country construction materials on contracts with an 
estimated value of $6,500,000 or more) are required to provide adequate 
information for Government evaluation under paragraph (a) of this 
section. Offerors may submit alternate offers for comparable domestic 
construction materials at stated prices. When foreign construction 
material (other than EC or NAFTA country construction materials on 
contracts with an estimated value of $6,500,000 or more) is not 
authorized under paragraph (a), evaluation of the offer must be based on 
the stated price, if any, for comparable domestic material. If an 
offeror proposing to use foreign construction materials (other than EC 
or NAFTA country construction materials on contracts with an estimated 
value of $6,500,000 or more) does not furnish data on the cost of 
comparable domestic construction material, and the use of foreign 
construction material is not authorized,

[[Page 374]]

such offer must be rejected, unless the contracting officer is able to 
obtain prices on comparable domestic material which verifies that 
domestic prices are unreasonable.
    (d) The contracting officer shall add 6 percent to the cost of 
foreign construction materials (other than EC or NAFTA country 
construction materials on contracts with an estimated value of 
$6,500,000 or more) authorized for use in accordance with paragraph (a) 
of this section, to the prices offered, if applicable, for evaluation 
purposes only.
[59 FR 64856, Dec. 16, 1994]



525.204  Violations.

    If a contractor fails to comply with the clause at FAR 52.225-5, Buy 
American Act--Construction Materials, the contracting officer shall 
document the failure in a report and forward the report to the debarring 
official for consideration for debarment action in accordance with 
Subpart 509.4.



525.205  Solicitation provision and contract clause.

    The contracting officer shall insert the provision at 552.225-75, 
Buy American Act Notice--Construction Materials in solicitations for 
construction that include the Buy American Act--Construction Materials 
clause at (FAR) 48 CFR 52.225-5 and have an estimated value less than 
$6,500,000. Alternate I shall be used for construction contracts with an 
estimated value of $6,500,000 or more that include the Buy American 
Act--Construction Materials Under European Community Agreement and NAFTA 
clause at (FAR) 48 CFR 52.225-15.
[59 FR 64857, Dec. 16, 1994]



               Subpart 525.3--Balance of Payments Program



525.302  Policy.

    (a) Decisions under FAR 25.302(b)(3) must be supported as provided 
in 525.108-70(a).
    (b) Use of a greater differential than provided in FAR 25.302(c) may 
be authorized by the HCA or a designee.



525.302-70  Procurements for agencies under the Foreign Assistance Act.

    When a contracting activity enters into contracts as the agent for 
an agency governed by the Foreign Assistance Act (22 U.S.C. 2151 et 
seq.) such as the Agency for International Development (AID), such 
contracts are governed by the policies and procedures of the agency and 
not by FAR 25.3 and 525.3.



525.304  Excess and near-excess foreign currencies.

    When a contracting activity procures articles or services for use 
outside the United States for another agency, it will be assumed (unless 
a specific notation is made on the purchase request) that use of excess 
or near excess foreign currencies has been considered by the 
requisitioning agency and that such currencies are not available.



525.371  Restricted solicitation.

    (a) Specific written estimates of comparative delivered prices of 
end products or service of domestic origin versus foreign origin made by 
the requisitioning office before submitting a purchase request is not 
required by the contracting activity. Procurements made directly for 
other agencies of items to be used outside the United States will be 
made under the Balance of Payments Program, except for agencies 
supported by GSA that come under the Foreign Assistance Act; e.g., AID 
and the Bureau of International Narcotics Matters.
    (b) Before procuring any item for GSA use outside the United States, 
cost estimates must be made before restricting competition to U.S. end 
products or services.



     Subpart 525.4--Purchases Under the Trade Agreements Act of 1979



525.402  Policy.

    (a) Under (FAR) 48 CFR 25.402(a), when the estimated value of all 
items or products (exclusive of any item or product within any of the 
exceptions described in (FAR) 48 CFR 25.403) listed in the solicitation 
exceeds the Trade Agreements Act threshold, contracting officers shall 
evaluate offers without regard to the restrictions of the Buy

[[Page 375]]

American Act or the Balance of Payments Program.
    (b) As a result of the General Services Administration Board of 
Contract Appeals (GSBCA) decision in the protest of International 
Business Machines Corporation, GSBCA no. 10532-P, May 18, 1990, 
contracting officers are hereby authorized to deviate from the FAR 
provision at 52.225-8, Buy American Act-Trade Agreements Act-Balance of 
Payment Program Certificate and FAR clause at 52.225-9, Buy American 
Act-Trade Agreements Act-Balance of Payment Program, in solicitations 
and contracts that are subject to the Trade Agreements Act by 
incorporating the provision and clause prescribed in 525.407(a).
    (c) When acquiring eligible products without full and open 
competition using the authorities in FAR 6.302-3(a)(2)(i) or 6.302-7, a 
copy of the approved justification must be furnished to the Associate 
Administrator for Acquisition Policy for subsequent transmittal to the 
U.S. Trade Representative.
[54 FR 26535, June 23, 1989, as amended at 54 FR 33554, Aug. 15, 1989; 
55 FR 32635, Aug. 10, 1990; 57 FR 42708, Sept. 16, 1992; 59 FR 64857, 
Dec. 16, 1994]



525.402-70  Delegation of limited waiver authority.

    (a) The U.S. Trade Representative, under section 302(b) of the Trade 
Agreements Act (Act), has authorized the Administrator of General 
Services to waive, under limited specified circumstances and on a case-
by-case basis, the purchasing prohibition in section 302(a)(1) of the 
Act.
    (b) The Administrator has delegated to the HCA authority to waive 
the purchasing prohibition in paragraph (a) of this section, in cases 
where in response to a solicitation:
    (1) There are no responsive bids or technically acceptable offers 
received from responsible offerors of U.S. or designated country end 
products, or
    (2) Responsible offerors do not offer a sufficient quantity to meet 
the Government's requirements.
    (c) A copy of any waiver under paragraph (b) of this section must be 
furnished to the Associate Administrator for Acquisition Policy for 
transmittal to the U.S. Trade Representative.



525.406  Agencies covered by the Agreement on Government Procurement.

    The exclusion provided for in FAR 25.406 for the Tools Commodity 
Center applies only to purchases of items in Groups 51 and 52 by the 
Tools Commodity Center Procurement Division of the International, Tools, 
and Appliances Commodity Center and to the Tools Material Management 
Division in Region 6.
[55 FR 38552, Sept. 19, 1990]



525.407  Solicitation provision and contract clause.

    (a) The contracting officer shall insert the provision at 552.225-8, 
Trade Agreements Act Certificate, and the clause at 552.225-9, Trade 
Agreements Act, in solicitations and contracts subject to the Trade 
Agreements Act in lieu of the FAR provision at 52.225-8 and the clause 
at 52.225-9.
    (b) The contracting officer shall insert the clause at 552.225-72, 
Eligible Products From Nondesignated Countries--Waiver, in solicitations 
and contracts subject to the Trade Agreements Act.
[57 FR 42708, Sept. 16, 1992]



          Subpart 525.9--Additional Foreign Acquisition Clauses



525.901  Omission of audit clause.

    The heads of contracting activities shall make the determination 
under FAR 25.901(c)(1) to waive the right to examination of records by 
the Comptroller General.
[60 FR 54957, Oct. 27, 1995]



PART 526 [RESERVED]




[[Page 376]]



             SUBCHAPTER E--GENERAL CONTRACTING REQUIREMENTS





PART 527--PATENTS, DATA, AND COPYRIGHTS--Table of Contents




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

    Source:  54 FR 26538, June 23, 1989, unless otherwise noted.



              Subpart 527.4--Rights In Data and Copyrights



527.409  Solicitation provisions and contract clauses.

    (a) The contracting officer shall insert the clause at 552.227-70, 
Government Rights (Unlimited), in lieu of the clause at FAR 52.227-17, 
Rights in Data-Special Works, in contracts for architect-engineer 
services and construction involving architect-engineer services, except 
when the clause at 552.227-71 is required.
    (b) The contracting officer shall substitute the clause at 552.227-
71, Drawings and Other Data to Become Property of Government, for the 
clauses at 552.227-70 and FAR 52.227-17 in contracts for architect-
engineer services and construction involving architect-engineer 
services, when the sole property rights and exclusive control over the 
design and data are required by the Government.



PART 528--BONDS AND INSURANCE--Table of Contents




                          Subpart 528.1--Bonds

Sec.
528.101  Bid guarantee.
528.101-1  Policy on use.
528.101-3  Contract clause.
528.102  Performance and payment bonds for construction contracts.
528.102-1  General.
528.103  Performance and payment bonds for other than construction 
          contracts.
528.103-2  Performance bonds.
528.103-3  Payment bonds.
528.106  Administration.
528.106-6  Furnishing information.

                         Subpart 528.2--Sureties

528.202  Acceptability of corporate sureties.
528.202-70  Acceptability of bonds and sureties.
528.203  Acceptability of individual sureties.
528.203-7  Exclusion of individual sureties.
528.204  Options in lieu of sureties.

                        Subpart 528.3--Insurance

528.301  General.
528.310  Contract clause for work on a Government installation.

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

    Source:  54 FR 26538, June 23, 1989, unless otherwise noted.



                          Subpart 528.1--Bonds



528.101  Bid guarantee.



528.101-1  Policy on use.

    (a) Construction contracts. (1) Bid guarantees must not be required 
for contracts awarded under section 8(a) of the Small Business Act as 
amended (15 U.S.C. 637(a)).
    (2) Unless waived under FAR 28.101-1(c), bid guarantees must be 
required for construction contracts (except section 8(a) contracts) that 
do not exceed $25,000 when it is determined under 528.102-1(b) that a 
performance bond is essential to protect the Government's interest.
    (b) Building service contracts. Unless waived by the HCA, bid 
guarantees must be required for building service contracts in excess of 
$25,000 when it is determined under 528.103-2 that a performance bond is 
essential to protect the Government's interest.
    (c) All other contracts. Refer to FAR 28.101 for guidance on the use 
of bid guarantees.



528.101-3  Contract clause.

    (a) The contracting officer shall insert a clause substantially the 
same as the clause at 552.228-70, Bid Guarantee and Bonds, in 
solicitations and contracts when a construction contract or a contract 
for dismantling, demolition, or removal of improvements is contemplated 
and a bid guarantee and bond requirement is to be included.
    (b) The contracting officer shall insert a clause substantially the 
same as the clause at 552.228-71, Bid Guarantee, in solicitations and 
contracts when a

[[Page 377]]

building service or other service contract is contemplated and a bid 
guarantee requirement is to be included.



528.102  Performance and payment bonds for construction contracts.



528.102-1  General.

    (a) The performance and payment bond requirements in FAR 28.102-1 
apply to contracts awarded under section 8(a) of the Small Business Act 
unless the requirement has been waived by SBA under section 8(a)(2) of 
the Small Business Act, as amended.
    (b) Performance and/or payment bonds may be required on a case-by-
case basis for construction contracts that do not exceed $25,000 if a 
written determination is made by the contracting officer and approved by 
the contracting director indicating that they are essential to protect 
the Government's interest.



528.103  Performance and payment bonds for other than construction contracts.



528.103-2  Performance bonds.

    (a) Performance bonds shall not be required for building service 
contracts unless a written determination is made by the contracting 
officer explaining why the bond is essential to protect the Government's 
interest and justifying the additional cost of the bonding requirement.
    (b) Performance bonds must not be required for building service 
contracts awarded under section 8(a) of the Small Business, Act as 
amended (15 U.S.C. 637(a)), or contracts awarded to workshops for the 
blind or other severely handicapped under the Javits-Wagner-O'Day Act, 
as amended (41 U.S.C. 46-48c).
    (c) The contracting officer shall consider the circumstances and 
determine the penal amount of the performance bond on a case-by-case 
basis.
    (d) The contracting officer shall insert a clause substantially the 
same as the clause at 552.228-72, Performance Bond, in solicitations and 
contracts when a building service or other service contract is 
contemplated and a performance bond requirement is to be included. The 
clause should be appropriately modified to delete references to the base 
term and options to extend the term of the contract when the 
solicitation does not include an option provision.
[54 FR 26538, June 23, 1989, as amended at 55 FR 5223, Feb. 14, 1990; 60 
FR 54956, Oct. 27, 1995]



528.103-3  Payment bonds.

    (a) Payment bonds may be required for other than construction 
contracts when the contracting director determines, under FAR 28.103-3, 
that such a requirement is in the Government's interest.
    (b) The contracting officer shall consider the circumstances and 
determine the penal amount of the payment bond on a case-by-case basis.
    (c) The contracting officer shall insert a clause substantially the 
same as the clause at 552.228-73, Performance and Payment Bonds, in 
solicitations and contracts when a building service or other service 
contract is contemplated and a performance and payment bond requirement 
is to be included. The clause should be appropriately modified to delete 
references to the base term and options to extend the term of the 
contract when the contract does not include an option provision.
[54 FR 26538, June 23, 1989, as amended at 55 FR 5223, Feb. 14, 1990]



528.106  Administration.



528.106-6  Furnishing information.

    The HCA or a designee shall perform the functions outlined in FAR 
28.106-6(c).



                         Subpart 528.2--Sureties



528.202  Acceptability of corporate sureties.

    (a) Corporate surety bonds must be manually signed by the Attorney-
in-Fact or officer of the surety company and the corporate seal affixed. 
Failure of the surety to affix the corporate seal may be waived as a 
minor informality. (See B-184120, July 2, 1975, 75-2 CPD 9.)
    (b) A contractor submitting a performance or payment bond executed 
by an unacceptable corporate surety in

[[Page 378]]

satisfaction of a performance or payment bond requirement may be 
permitted to substitute an acceptable surety for a surety previously 
determined to be unacceptable.
[58 FR 52444, Oct. 8, 1993]



528.202-70  Acceptability of bonds and sureties.

    The contracting officer shall verify the acceptability of the surety 
on a bond by placing the words ``Acceptability of Bond Verified,'' and 
sign immediately thereunder, on the bond or on a properly identified 
attachment. The bond must be retained with the original of the contract. 
The contracting officer shall notify the contractor that the bond(s) has 
been accepted.
[55 FR 5223, Feb. 14, 1990]



528.203  Acceptability of individual sureties.

    Evidence of possible criminal or fraudulent activities by an 
individual surety must first be referred to the Assistant Inspector 
General for Investigations or to the appropriate regional Inspector 
General for Investigations. The Office of Inspector General may conduct 
an investigation and, when appropriate, refer the matter to the 
Associate Administrator for Acquisition Policy. Referrals must include 
the information required by 528.203-7.
[55 FR 5223, Feb. 14, 1990]



528.203-7  Exclusion of individual sureties.

    (a) The Associate Administrator for Acquisition Policy or designee 
excludes individuals from acting as a surety on bonds under FAR 28.203-
7.
    (b) Referrals for consideration of exclusion must include as a 
minimum:
    (1) The basis for exclusion (see FAR 28.203-7(b));
    (2) A statement of facts;
    (3) Copies of supporting documentary evidence;
    (4) The individuals name and current or last known home and or 
business addresses including zip codes;
    (5) A statement of GSA's history with such individuals, if any; and
    (6) A statement concerning any known active or potential criminal 
investigations or court proceedings.
[55 FR 5223, Feb. 14, 1990]



528.204  Options in lieu of sureties.

    (a) An irrevocable letter of credit may be accepted as a bid 
guarantee under FAR clause 52.228-1, Bid Guarantee.
    (b) Security deposited instead of corporate or individual sureties 
on bonds must be safeguarded as provided in procedures issued by the 
Office of the Comptroller immediately after they are received. United 
States bonds or notes received in the District of Columbia must be 
deposited with the Treasurer of the United States as provided in FAR 
28.204-1.
[55 FR 5224, Feb. 14, 1990]



                        Subpart 528.3--Insurance



528.301  General.

    (a) Insurance requirements must be adequate, just, and reasonable, 
and should be predicated on potential loss or damage (not necessarily on 
the value of the contract). When it is determined that insurance 
coverage should be required, the solicitation and resultant contract 
must contain the appropriate provisions prescribed in FAR 28.309, 
28.310, or 28.311. The determination as to the type of insurance, 
amount, and any related insurance requirements must be made by the 
contracting officer with the advice of assigned legal counsel. All 
premiums or costs incurred to comply with an insurance requirement must 
be paid by the contractor.
    (b) Submission of a current certificate of insurance indicating the 
amount and coverage, to the contracting officer, will serve as 
certification that the required insurance has been obtained.



528.310  Contract clause for work on a Government installation.

    The contracting officer shall insert the clause at 552.228-
75,Workmen's Compensation Laws, in solicitations and contracts when the 
contract amount is expected to exceed the simplified acquisition 
threshold and the

[[Page 379]]

contract will require work to be performed on Government property.
[54 FR 26538, June 23, 1989, as amended at 60 FR 42804, Aug. 17, 1995]



PART 529--TAXES--Table of Contents




                     Subpart 529.4--Contract Clauses

Sec.
529.401  Domestic contracts.
529.401-70  Purchases made using simplified acquisition procedures.
529.401-72  Contracts usable by the DC Government.

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

    Source:  54 FR 26540, June 23, 1989, unless otherwise noted.



                     Subpart 529.4-Contract Clauses



529.401  Domestic contracts.



529.401-70  Purchases made using simplified acquisition procedures.

    The contracting officer shall insert the clause at 552.229-70, 
Federal, State, and Local Taxes, in purchases made using simplified 
acquisition procedures, except acquisitions of utility services and 
micro purchases.
[60 FR 42804, Aug. 17, 1995]



529.401-72  Contracts usable by the DC Government.

    The contracting officer shall insert the clause at 552.229-72, 
Federal Excise Tax--DC Government, in contracts which involve the 
purchase of supplies by the District of Columbia Government.



PART 530--COST ACCOUNTING STANDARDS--Table of Contents




                Subpart 530.2--CAS Program Requirements.

530.201-5  Waiver.

                Subpart 530.4--Cost Accounting Standards

530.470  Waiver of Cost Accounting Standard 9904.412-40(c).



                Subpart 530.2--CAS Program Requirements.



530.201-5  Waiver.

    Requests to waive CAS requirements under FAR 30.201-5 shall be 
submitted to the CAS Board through the Associate Administrator for 
Acquisition Policy.
[57 FR 61584, Dec. 28, 1992]



                Subpart 530.4--Cost Accounting Standards



530.470  Waiver of Cost Accounting Standard 9904.412-40(c).

    The Associate Administrator for Acquisition Policy (V) on a non-
delegable basis may waive the cost assignment provisions of 48 CFR 
9904.412-40(c). Requests for waivers shall be forwarded to the Associate 
Administrator with supporting documentation and rationale. A copy of 
each approved waiver will be furnished by the Associate Administrator to 
the CAS Board's Executive Secretary.
[57 FR 61584, Dec. 28, 1992]



PART 531--CONTRACT COST PRINCIPLES AND PROCEDURES--Table of Contents






                      Subpart 531.1--Applicability



531.101  Objectives.

    The Associate Administrator for Acquisition Policy approves 
individual deviations concerning cost principles under FAR 31.101.

(40 U.S.C. 486(c))
[54 FR 26541, June 23, 1989]



PART 532--CONTRACT FINANCING--Table of Contents




                         Subpart 532.1--General

Sec.
532.111  Contract clauses.
532.112  Payment of subcontractors under contracts for non-commercial 
          items.
532.112-1  Subcontractor assertions of nonpayment.

                     Subpart 532.4--Advance Payments

532.402  General.
532.407  Interest.

[[Page 380]]

             Subpart 532.5--Progress Payments Based on Costs

532.501  General.
532.501-2  Unusual progress payments.
532.501-70  Use of benchmarks with progress payments based on costs.
532.502  Preaward matters.
532.502-2  Contract finance office clearance.
532.502-4  Contract clauses.
532.503-5  Administration of progress payments.
532.503-6  Suspension or reduction of payments.
532.503-9  Liquidation rates--alternate method.

                      Subpart 532.6--Contract Debts

532.601  Definitions.
532.606  Debt determination and collection.
532.606-70  Referral of delinquent debts.

                     Subpart 532.7--Contract Funding

532.700  Scope.
532.705  Contract clauses.
532.705-1  Clauses for contracting in advance of funds.

                   Subpart 532.8--Assignment of Claims

532.805  Procedures.
532.806  Contract clauses.

                      Subpart 532.9--Prompt Payment

532.905  Invoice payments.
532.905-70  Certification of payment to subcontractors and suppliers.
532.905-71  Final payment.
532.908  Contract clause.

   Subpart 532.70--Authorizing Payment by Credit Card Under Schedule 
                                Contracts

532.7001  Definitions.
532.7002  Solicitation requirements.
532.7003  Contract clause.

        Subpart 532.71--Payments Under Contracts Subject to Audit

532.7101  General.
532.7102  Submission and processing of invoices or vouchers.
532.7103  Action upon receipt of an audit report.
532.7104  Suspension and disapproval of amounts claimed.

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

    Source:  54 FR 26541, June 23, 1989, unless otherwise noted.



                         Subpart 532.1--General



532.111  Contract clauses.

    (a) Discounts for prompt payment. The clause at 552.232-8 must be 
included in multiple award schedule solicitations and resultant 
contracts, instead of the clause at FAR 52.232-8. (See 515.608-71 for an 
explanation concerning this deviation.)
    (b) Invoice requirements. The contracting officer shall insert a 
clause substantially the same as the clause at 552.232-72, Invoice 
Requirements, in all solicitations and contracts for supplies, services, 
construction or the acquisition of leasehold interests in real property 
that require the submission of invoices for payment. The contracting 
officer should delete subparagraph (b) of the clause when an Accounting 
Control Transaction (ACT) number is not required for payment.
    (c) Adjusting payments. The contracting officer shall insert the 
clause at 552.232-78, Adjusting Payments, in all solicitations and 
contracts for recurring building services expected to exceed the 
simplified acquisition threshold.
    (d) Final payment. The contracting officer shall insert the clause 
at 552.232-79, Final Payment, in all solicitations and contracts for 
recurring building services expected to exceed the simplified 
acquisition threshold.
[54 FR 26541, June 23, 1989, as amended at 60 FR 42804, Aug. 17, 1995]



532.112  Payment of subcontractors under contracts for non-commercial items.



532.112-1  Subcontractor assertions of nonpayment.

    Contracting officers who determine that a certification of payment 
of a subcontractor or supplier under FAR 32.112-1 is inaccurate in any 
material respect shall report the matter to the Office of Inspector 
General. If appropriate, the Office of Inspector General will forward a 
report and recommendation to the Department of Justice.
[61 FR 1151, Jan. 17, 1996]

[[Page 381]]



                     Subpart 532.4--Advance Payments



532.402  General.

    The findings and determinations required by FAR 32.402(e) must be 
prepared by the contracting officer in coordination with legal counsel 
and the contract finance office. The findings, determinations and 
authorization for advance payments must be approved by the head of the 
contracting activity (HCA).



532.407  Interest.

    The contract finance office will provide the contracting officer the 
interest rate to be charged on the unliquidated balance of advance 
payments.



             Subpart 532.5--Progress Payments Based on Costs



532.501  General.



532.501-2  Unusual progress payments.

    The HCA must approve or disapprove requests for ``unusual'' progress 
payments.



532.501-70  Use of benchmarks with progress payments based on costs.

    (a) In unusual circumstances, it may be desirable to provide for the 
achievement of specified benchmarks such as submission and acceptance of 
a preproduction or pilot model before making progress payments based on 
costs. When progress payments are conditioned upon achievement of 
specified benchmarks during performance of the contract, the HCA must 
make a written determination that use of benchmarks is in the best 
interest of the Government. When such a determination is made, the 
solicitation and each resulting contract must include a provision 
specifying the benchmarks that must be achieved before progress payments 
are made.
    (b) Benchmarks should not be used in a manner that will convert 
progress payments based on costs into progress payments based on a 
percentage or stage of completion.



532.502  Preaward matters.



532.502-2  Contract finance office clearance.

    (a) The contract finance office director must provide the approval 
required by FAR 32.502-2.
    (b) Contracting officers must request the contract finance office to 
provide advice and assistance regarding a contractor's financial 
condition and the adequacy of the contractor's accounting system and 
controls before providing for progress payments based on costs.



532.502-4  Contract clauses.

    The appropriate legal counsel must concur in the progress payment 
clause included in each solicitation and contract when the progress 
payments will be based on cost.



532.503-5  Administration of progress payments.

    The contracting officer must ensure that the contract finance office 
(1) has adequate administrative and fiscal procedures to accomplish the 
fiscal aspects of FAR 32.503-5, (2) provides the contracting officer 
with the date and amount of each progress payment to a contractor, and 
(3) provides the contracting officer with written recommendations 
whenever findings are made which warrant action by the Government.



532.503-6  Suspension or reduction of payments.

    Action recommended by the contracting officer under FAR 32.503-6 
must be approved by the HCA after coordination with the assigned legal 
counsel. Upon approval, the contracting officer will request the 
contract finance office to suspend or reduce payments.



532.503-9  Liquidation rates--alternate method.

    Reduction of the liquidation rates specified in paragraph (b) of the 
clause at FAR 52.232-16, may be made only with the approval of the 
contracting director after coordination with the contract finance 
office. Upon approval, the contracting officer will request the finance 
office to reduce the rate.

[[Page 382]]



                      Subpart 532.6--Contract Debts



532.601  Definitions.

    Debt means an amount of money or property which has been determined 
by a responsible official to be owed to the United States from any 
person, or entity except that the terms do not apply to amounts owed by 
another Federal agency.
    Delinquent debt means an amount that has not been paid or otherwise 
collected by the date specified (usually 30 days) in the contracting 
officer's initial written demand for payment (i.e., final decision 
letter).
    Responsible official as used in this subpart means the contracting 
officer. However, the contract finance office is responsible for the 
administration of debt collection under the Accounting Operations--
Accounts Receivable and Credit and Finance Operations, and Related 
Activities Handbook (PFM P 4253.1).



532.606  Debt determination and collection.



532.606-70  Referral of delinquent debts.

    (a) When the contracting officer determines that a debt in excess of 
$100 is delinquent, the contracting officer shall forward notification 
of the delinquent debt to the applicable finance office for collection 
in accordance with the Debt Collection Act of 1982, and possible 
forwarding to a credit reporting agency.
    (b) If the contractor appeals the contracting officer's demand for 
payment pursuant to the Disputes clause of its contract, the contracting 
officer shall advise the Finance Office whether to suspend collection 
efforts pending resolution of the dispute.



                     Subpart 532.7--Contract Funding



532.700  Scope.

    GSA fiscal regulations are contained in the Budget Administration 
Handbook (COM P 4251.3A), Accounting Classification Handbook (COM P 
4240.1), and Accounting Operations--Voucher Examination, Payment 
Handbook (PFM P 4252.1).



532.705  Contract clauses.



532.705-1  Clauses for contracting in advance of funds.

    The contracting officer shall insert the clause at 552.232-77, 
Availability of Funds, in solicitations and contracts for services which 
are ``severable'' when the contact, or a portion of the contract, will 
be chargeable to funds of the new fiscal year and the circumstances 
described in the prescriptions for the FAR clauses at 52.232-18 or 
52.232-19 do not apply.
[61 FR 1151, Jan. 17, 1996]



                   Subpart 532.8--Assignment of Claims



532.805  Procedures.

    (a) Upon receipt of a notice of assignment, the contracting officer 
must obtain legal counsel concurrence that both the notice and the 
instrument of assignment are in proper form, properly executed, and are 
actions that the contractor is entitled to make under the terms of the 
contract.
    (b) When acknowledging receipt of the notice of assignment, the 
contracting officer must notify the contractor that all future invoices 
or other requests for payment under the contract must specify the name 
and address of the assignee and include a notation that payments due 
thereunder have been duly assigned. A copy of the acknowledgement, 
evidencing legal counsel concurrence, must be sent to the contract 
finance office.
    (c) When payments under requirements or indefinite quantity 
contracts that are for the sole use of GSA have been assigned, the 
contracting officer must provide all GSA offices that will place orders 
against the contract the name and address of the assignee that will 
receive amounts due under the contract. The notification should also 
state that the contractor has been requested to specify the name and 
address of the assignee on future invoices.



532.806  Contract clauses.

    The contracting officer shall insert the clause at 552.232-23, 
Assignment of

[[Page 383]]

Claims, in solicitations and requirements or indefinite quantity 
contracts under which more than one agency may place orders.



                      Subpart 532.9--Prompt Payment



532.905  Invoice payments.

    (a) Before exercising the authority to modify the date for 
constructive acceptance in subdivision (a)(6)(i) of the clause at FAR 
52.232-25, Prompt Payment, or subdivision (a)(5)(i)(A) of the clause at 
FAR 52.232-26, Prompt Payment for Fixed-Price Architect-Engineer 
Contracts, the contracting officer shall prepare a written justification 
explaining why a longer period is necessary. The time specified must be 
determined on a case-by-case basis and the justification must be 
approved by an official one level above the contracting officer. A 
contracting officer must not specify a constructive acceptance period 
that exceeds 30 days. The time specified in subdivision (a)(5)(i)(B) of 
the clause at FAR 52.232-26 for constructive approval of progress 
payments must not exceed 7 days.
    (b) 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, must be determined by the contracting 
officer on a case-by-case basis. Periods longer than 14 days must be 
justified in writing and approved by an official one level above the 
contracting officer. Under no circumstances may more than 30 days be 
specified. The time specified in subdivision (a)(4)(i) of FAR clause 
52.232-27, for constructive acceptance or approval will be determined by 
the contracting officer on a case-by-case basis but may not exceed 7 
days unless a longer period is justified, in writing, and approved by an 
official one level above the contracting officer. Under no circumstances 
may more than 30 days be specified.



532.905-70  Certification of payment to subcontractors and suppliers.

    When a contract includes the clause at FAR 52.232-5, Payments Under 
Fixed-Priced Construction Contracts, no progress payments will be 
processed until the contractor submits a certification of payment to 
subcontractors and suppliers. The GSA Form 2419, Certification of 
Progress Payments Under Fixed-Price Construction Contracts, may be used 
for certification.



532.905-71  Final payment.

    (a) The final payment on construction or building service contracts 
must not be processed until the contractor submits a properly executed 
GSA Form 1142, Release of Claims. If, after repeated attempts, the 
contracting officer is unable to obtain a release of claims from the 
contractor, final payment may be processed with the approval of 
appropriate legal counsel.
    (b) The amount of final payment must include, as appropriate, any 
deductions to cover liquidated damages for late completion, liquidated 
damages for labor violations, amounts withheld for improper payment of 
labor wages, and the amount of unilateral change orders covering defects 
and omissions.



532.908  Contract clause.

    (a) The contracting officer shall insert the clause at 552.232-70, 
Payments by Electronic Funds Transfer, in solicitations and contracts 
that include the FAR clause 52.232-28, when payments may be made by GSA 
and other agencies (e.g., multiple award schedule contracts).
    (b) The contracting officer shall insert the clause at 552.232-71, 
Prompt Payment, in solicitations and contracts for the acquisition of 
leasehold interests in real property. The contracting officer may modify 
the date for constructive acceptance in subparagraph (b)(2) of the basic 
clause to specify a period longer than 7 calendar days (but not to 
exceed 30 days) if necessary due to the nature of the services to be 
received, inspected or accepted by the Government. A written 
justification for specifying the longer period must be prepared and 
approved by the contracting director. The contracting officer shall use 
Alternate I instead of the basic clause if the lease contract does not 
contain provisions for ordering alterations or overtime utility 
services.
    (c) The contracting officer shall insert the clause at 552.232-73, 
Electronic

[[Page 384]]

Funds Transfer Payment, in solicitations and contracts for acquisitions 
of leasehold interests in real property which involve both more than 
10,000 square feet of space and terms which exceed 6 months, if payment 
may be made by electronic funds transfer.
[54 FR 26541, June 23, 1989, as amended at 57 FR 37890, Aug. 21, 1992]



   Subpart 532.70--Authorizing Payment by Credit Card Under Schedule 
                                Contracts

    Source:  54 FR 43180, Oct. 23, 1989, unless otherwise noted.



532.7001  Definition.

    Government commercial credit card, used in this subpart, means the 
uniquely numbered credit card issued by the contractor under single 
award schedule, Federal Supply Schedule IG 615, Governmentwide 
Commercial Credit Card Service, to named individual Government employees 
to pay for official Government purchases.



532.7002  Solicitation requirements.

    When solicitations for schedule contracts for supplies (other than 
telecommunication and telephone equipment) and services (other than 
teleprocessing services) request offerors to indicate whether payment by 
Government commercial credit card for orders of $25,000 or less will be 
accepted, the contracting officer shall identify the clearinghouse that 
is being used by the contractor issuing credit cards under single award 
schedule, Federal Supply Schedule IG 615, for Governmentwide Commercial 
Credit Card Service on the cover page or in section L of the 
solicitation. The name of the clearinghouse is provided for offerors' 
information and use in responding to the schedule solicitation.



532.7003  Contract clause.

    The contracting officer shall insert the clause at 552.232-80, 
Payment By Credit Card, in schedule solicitations and resultant 
contracts for supplies (other than telecommunication and telephone 
equipment) and services (other than teleprocessing services) to provide 
for payment by Government commercial credit card as an alternative 
method of payment for orders of $25,000 or less.



        Subpart 532.71--Payments Under Contracts Subject to Audit



532.7101  General.

    (a) The contracting officer shall not approve the initial invoice or 
voucher before consulting with the Assistant Inspector General--Auditing 
or the Field Audit Office regarding cost or other supporting data as 
required under:
    (1) Cost-reimbursement type contracts;
    (2) The cost-reimbursement portion of fixed-price type contracts;
    (3) Time and materials or labor-hour contracts; or
    (4) Fixed-price contracts providing for (i) progress payments based 
on costs, (ii) advance payments, (iii) guaranteed loans, or (iv) 
incentives or redetermination.
    (b) The contracting officer shall not approve the final payment 
invoice or voucher for such contracts, nor for the final payment or 
settlement of other contracts subject to audit prior to (1) receipt and 
review of the contract audit report or (2) consultation with the 
Assistant Inspector General for Auditing or the Field Audit Office if no 
audit is to be conducted; provided, that this paragraph (b) shall not 
apply to fixed-price contracts with escalation where no price revision 
(upward or downward) is to be made.



532.7102  Submission and processing of invoices or vouchers.

    (a) Contractors should be required to submit invoices or vouchers to 
the contracting officer. Contracting officers must annotate the invoices 
with the date of receipt as required by FAR 32.905. That date will be 
used to determine interest penalties for late payments. The processing 
of invoices or vouchers before payment must include a review by the 
contracting officer, or a designee, to determine that the items and 
amounts claimed are in consonance with the contract terms and represent 
prudent business transactions. The contracting officer must

[[Page 385]]

ensure that these payments are commensurate with physical and technical 
progress under the contract. If the contractor has not deducted from the 
invoice amounts which are questionable or which are required to be 
withheld, the contracting officer shall make the required deduction, 
except as provided in 532.7103.
    (b) Subject to 532.7101, approval by the contracting officer of any 
payment, must be noted on (or attached to) the invoice or voucher 
submitted by the contractor. The invoice or voucher will be forwarded to 
the appropriate contract finance office and retained therein after 
certification and scheduling for payment by a disbursing office.



532.7103  Action upon receipt of an audit report.

    Audit reports will be furnished to the contracting officer, with a 
copy to the appropriate contract finance office. Upon receipt of an 
audit report, the contracting officer shall, pursuant to contract terms, 
determine the allowability of all costs covered by audit, giving full 
consideration to the auditor's recommendations. When the contracting 
officer is in doubt or questions the recommendations of the auditor, 
deductions need not be made from invoices or vouchers for provisional 
payments. In these cases, the contracting officer shall confer with the 
auditor and other appropriate Government personnel (such as a price 
specialist or legal counsel) to determine what further action should be 
taken regarding the costs in question. If the contracting officer 
disagrees with the auditor's recommendations, the contracting officer 
shall document the contract file and furnish the auditor with a copy of 
the statement.



532.7104  Suspension and disapproval of amounts claimed.

    The contracting officer shall notify the appropriate contract 
finance office in writing when amounts claimed for payment are (a) 
suspended, (b) disapproved as not being allowable according to contract 
terms, or (c) not allocable to the contract. This notice by the 
contracting officer will be the basis for the issuance by the contract 
finance office of GSA Form 533, Administrative Difference Statement. A 
copy of GSA Form 533 will be attached to each copy of the invoice or 
voucher from which the deduction has been made, including an explanation 
of the deduction.



PART 533--PROTESTS, DISPUTES, AND APPEALS--Table of Contents




                         Subpart 533.1--Protests

Sec.
533.101  Definitions.
533.102  General.
533.103  Protest to the agency.
533.104  Protests to GAO.
533.105  Protests to GSBCA.

                   Subpart 533.2--Disputes and Appeals

533.214  Contract clause.

               Subpart 533.71--Processing Contract Appeals

533.7100  Definitions.
533.7101  Notice of appeal.
533.7102  Contents of notices of appeal.
533.7103  Appeal files.
533.7103-1  Preparation of the appeal file.
533.7103-2  Transmittal of the appeal file.
533.7104  The contracting officer's memorandum of position.
533.7105  Procedure following decision of the GSA Board of Contract 
          Appeals.

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

    Source:  54 FR 26543, June 23, 1989, unless otherwise noted.



                         Subpart 533.1--Protests



533.101  Definitions.

    Associate General Counsel means the Associate General Counsel of the 
General Law Division, Personal Property Division, or Real Property 
Division.



533.102  General.

    Except as indicated in this subpart, the Office of General Counsel 
(OGC) is responsible for all contacts with the GAO or GSBCA, potential 
contractors, attorneys, and any other persons, concerning protests of 
GSA contract actions filed with the Comptroller General or GSBCA.

[[Page 386]]



533.103  Protests to the agency.

    When a protest is filed only with the agency, the contracting 
officer is required to issue a written response to the protest. An 
agency protest is deemed to be filed with the agency when the complete 
protest is received at the location designated in the solicitation for 
service of protests. If the complete protest is actually received by the 
contracting officer at an earlier time, the protest shall be deemed to 
be filed when received by the contracting officer.
    When a protest is filed only with the agency, an award may not be 
made until a decision on the protest is issued, unless the contracting 
director first makes the determination required by FAR 33.103(a)(2). The 
protestor must be notified in writing of the contracting officer's 
decision in a timely manner.
[56 FR 47006, Sept. 17, 1991]



533.104  Protests to GAO.

    (a) General procedures. (1) In addition to the requirements of FAR 
33.104(a)(3), the agency report must contain the GAO protest number (GAO 
case file number), the solicitation or contract number, the full 
corporate name of the protesting organization and other firms involved, 
and a statement indicating whether the protest was filed before or after 
award. If the protest is filed after award, the report must contain the 
identity of the awardee, the date of award, the contract number, the 
date and time of bid opening (including a statement when the date of bid 
opening was extended by subsequent amendments), the total number of 
offerors, a complete chronological statement of all relevant events and 
administrative actions taken (including reasons and authority for the 
actions taken), and any other relevant documents believed helpful in 
determining the validity of the protest. (This evidence should be 
referenced and identified within the text of the position statement, 
alphabetically or numerically, e.g., Tab A, Exhibit 1, etc.)
    (2) GAO protests must be handled on a priority basis. The 
appropriate Associate General Counsel (AGC) shall prepare a report for 
signature of the General Counsel responding to GAO protests. These 
reports are to be based upon a statement of fact and position prepared 
by the responsible contracting officer and approved by the contracting 
director. When requested by the appropriate AGC, the Regional Counsel 
will prepare a statement of legal position analyzing the merits of a 
protest concerning a regional procurement.
    (3) The following procedures must be followed in handling protests:
    (i) When a protest is received by the agency, the AGC shall 
telephonically notify the contracting officer through the appropriate 
Central Office contracting activity or Regional Counsel. If the 
contracting activity or Regional Counsel receives a copy of a protest 
before being notified thereof by the AGC, they must immediately notify 
the appropriate AGC.
    (ii) After receiving the formal protest, which has been filed with 
GAO, the AGC will formally request a statement of fact and position from 
the contracting officer through the appropriate Central Office 
contracting activity or Regional Counsel. The contracting officer shall 
immediately notify the affected bidders or offerors that a protest has 
been received.
    (iii) The contracting officer shall notify assigned counsel and 
begin preparing a documented statement of fact and position immediately 
upon receiving a protest or notice thereof.
    (iv) When completed, the statement of fact and position must be 
concurred in by the contracting director, and on regional procurements, 
by the Office of Regional Counsel. In appropriate cases, the AGC may 
request the Regional Counsel to prepare a legal position analyzing the 
merits of a protest against a regional procurement. In such cases, the 
contracting officer's statement of fact and position should be included 
as a referenced attachment thereto.
    (v) The Regional Counsel's legal position, when requested, and the 
contracting officer's statement of fact and position, must be 
transmitted to the appropriate AGC, in triplicate. If other interested 
parties are involved, additional copies may be requested. The

[[Page 387]]

statement is due in the office of the appropriate AGC no later than 10 
workdays after the date on which the contracting officer originally 
received the protest. This time may be reduced if GAO invokes the 
express option. If a contracting officer is unable to prepare a 
statement of fact and position within 10 workdays, the appropriate AGC 
must be notified promptly, by telephone, of the reasons for the delay 
and of the additional time needed. Additional time may be granted if the 
specific circumstances of the protest require a longer time. A request 
for an extension is proper only if the facts or legal issues affecting 
the resolution of a protest are so complicated that an adequate report 
cannot be prepared on time; the need to coordinate the report with other 
agencies, or with offices in distant locations, makes it impossible to 
prepare the report on time; or other compelling circumstances prevent 
preparing the report on time. Upon request of the AGC, the contracting 
officer shall confirm any oral requests for extensions in writing. The 
contracting director shall concur in the request and send a copy to the 
HCA. A request for an extension, which will delay submission of the 
agency's report to GAO beyond 35 days from the date GSA originally 
received the protest, may be granted only by the GAO. The AGC will 
notify the Central Office contracting activity or Regional Counsel of 
the GAO's decision.
    (vi) After submitting the statement to the AGC, the contracting 
officer or Regional Counsel must advise the AGC of all later 
developments that may affect the case.
    (vii) All documents transmitted under these procedures must be sent 
by the fastest means possible.
    (viii) In addition to the requirements of FAR 33.104(a)(5)(ii), a 
copy of any comments is sent to the AGC.
    (4) The Office of General Counsel (OGC) must furnish the GAO with 
the name, title, and telephone number of one or more officials whom the 
GAO may contact regarding protests. The OGC is responsible for promptly 
advising the GAO of any change in the designated officials.
    (5) The format for notification required by FAR 33.104(a)(2) is as 
follows:

Name

Address

    A protest concerning Solicitation No. ____________ has been filed 
with the General Accounting Office (GAO).
    The protest was filed by (Insert the name and address of the 
protester, and the name of the person signing the protest.) on (Date).
    Copies of the protest may be obtained from this office.
    You may submit your views and relevant information regarding the 
protest directly to the General Accounting Office. A copy of any 
submission to the GAO should be provided to this office.
 _______________________________________________________________________

Contracting Officer's signature

    (b) Protests before award. Under FAR 33.104(b), the HCA may 
determine in writing that urgent and compelling circumstances 
significantly affecting the interests of the United States do not permit 
waiting for the decision of GAO and award is likely to occur within 30 
days. The written determinations and findings (D&F), in the format shown 
at 501.704-70(e)(1), should be prepared by the contracting officer for 
the signature of the HCA. The D&F must be concurred in by the Regional 
Counsel (on regional procurements), and the appropriate AGC. After the 
D&F is approved, it must be returned to the appropriate AGC who notifies 
GAO of the agency's findings and intended action before the award is 
made.
    (c) Protests after award. If the protest is received from GAO (not 
from protester or any other party) within the time periods specified in 
FAR 33.104(c) contract performance must be suspended unless the HCA 
determines in writing that contract performance is in the best interests 
of the United States or that urgent and compelling circumstances that 
significantly affect the interests of the United States do not permit 
waiting for the GAO's decision. The written determination and findings 
(D&F), in the format shown at 501.704-70(e)(2), should be prepared by 
the contracting officer for signature of the HCA. The D&F must be 
concurred in by the Regional Counsel (on regional procurements), and the 
appropriate AGC. After the D&F is approved, it must be returned to the 
AGC who notifies GAO of the agency's findings and intended action before 
contract performance is authorized.

[[Page 388]]

    (d) Notice to GAO. The HCA responsible for the solicitation, 
proposed award, or award of the contract must report to the Comptroller 
General through the OGC within 65 days of receipt of the GAO's 
recommendation if the agency has decided not to comply with the 
recommendation. The report must explain the reasons why the GAO's 
recommendation will not be followed.
[54 FR 26543, June 23, 1989, as amended at 57 FR 61584, Dec. 28, 1992; 
61 FR 1151, Jan. 17, 1996]



533.105  Protests to GSBCA.

    (a) Notification procedure. After receiving a protest, the 
contracting officer shall notify the following:
    (1) All firms solicited, or those who have submitted sealed bids or 
offers if the protest is filed after the closing date of the 
solicitation, and the appropriate delegating official in the Information 
Technology Service. When giving such notification, the contracting 
officer should follow these procedures:
    (i) Avoid interpreting or characterizing the nature of the protest.
    (ii) Use appropriate means to ensure delivery to all the firms by 
the workday after the date of filing with the GSBCA.
    (iii) Use the following format:

Name (Officer, Managing Agent, or person who signed offer)

Address
    A protest concerning Solicitation No. __________ has been filed with 
the General Services Administration Board of Contract Appeals (GSBCA). 
The protest was filed by (Insert the name and address of the protester 
and the name of the person signing the protest.) on (Date). The protest 
has been purportedly filed pursuant to Section 2713 of the Competition 
in Contracting Act, Pub. L. 98-369. Copies of the protest may be 
obtained from the Office of the Clerk of the GSBCA, 18th and F Streets 
NW, Washington, DC 20405, or from the contracting officer.

    Contracting Officer's signature

    (2) The agency on whose behalf GSA is making the procurement, if 
any. A copy of the protest complaint, including all attachments, must be 
forwarded to the agency by appropriate means to ensure next day delivery 
to both the requiring office and the agency's legal office.
    (3) Assigned counsel. A copy of the protest complaint, including all 
attachments, must be forwarded to the appropriate AGC by appropriate 
means to ensure next day delivery.
    (4) The Board, through assigned counsel, within 3 workdays after the 
date of filing with the GSBCA, that the notices described in paragraphs 
(a)(1) and (2) have been given. Written confirmation of notice and a 
listing of all persons and agencies receiving notice must be provided.
    (b) Protest file. To ensure timely submission, the contracting 
officer should begin assembly of the protest file by the second workday 
after receiving the protest. The protest file must be forwarded to 
assigned counsel by overnight delivery not later than the 8th workday 
after the protest is filed with the GSBCA. Assigned counsel will 
distribute the copies to the GSBCA, the protester, and retain one copy 
for itself. If additional copies are needed, assigned counsel will 
advise the contracting officer. The following rules govern the assembly 
of protest files:
    (1) Format. Protest file exhibits are true, legible, and complete 
copies. They must be arranged in chronological order within each 
submission, earliest documents first, bound on the left margin except 
where size or shape makes such binding impracticable, numbered, tabbed, 
and indexed. The numbering must be consecutive, in whole arabic numerals 
(no letters, decimals, or fractions), and continuous from one submission 
to the next, so that the complete file, after all submissions, will 
consist of one set of consecutively numbered exhibits. The index should 
include the date and a brief description of each exhibit and indicate 
which exhibits, if any, have been filed with the Board in camera (see 
(b)(3) of this section) or otherwise not served on every other party.
    (2) Contents. In addition to the items required by FAR 33.105(b), 
the contents should include those items required by GSBCA Rule 4(a), 
when appropriate. (See 48 CFR 6101.4(a).)
    (3) Confidential, privileged, or proprietary information. The 
protest file may require the inclusion of documents and information from 
other vendors which

[[Page 389]]

are confidential, proprietary, or privileged. When such information is 
required to be included in the protest file, it is to be placed only in 
the copies going to the Board and to assigned counsel. Copies going to 
other interested parties will only identify the information in the 
index. However, the index must not reveal the number and identity of the 
offerors whose proposals are included in the copies of the protest file 
going to assigned counsel and the GSBCA, and should include an 
identifying statement, e.g., ``proposals being considered for award.''
    (c) Protest conference. Within 6 working days of filing a protest, a 
conference may be convened by the Board to establish further proceedings 
for the protest. Although the protest file and answer will most likely 
not have been filed, the Government must be prepared to discuss the 
issues in the protest, whether a record submission or hearing is 
desired, and other matters raised by the Board or any other interested 
party. The Government must also be prepared, if required, to object to 
the scope of discovery in any protest action.
    (d) Procedure following decision of the GSA Board of Contract 
Appeals. (1) Upon a Board decision (oral or written) to suspend 
procurement authority pending a decision on the merits of a protest, the 
contracting officer, in conjunction with the appropriate AGC, shall 
comply with the suspension decision.
    (2) If the Board suspends performance of a contract for automatic 
data processing goods and services, the contracting officer shall take 
immediate action to comply with the suspension decision (40 U.S.C. 
759(h)(3)(B)). Such suspension will be effective as directed by the 
Board.
    (3) If the Board revokes, suspends, or revises procurement authority 
after the award of a contract for ADP resources, the contracting officer 
shall consider the contract valid as to all goods or services delivered 
and accepted before the Board's decision (40 U.S.C. 759(h)(6)(B)).
[54 FR 26543, Jun. 23, 1989, as amended at 59 FR 22520, May 2, 1994; 59 
FR 29480, June 7, 1994; 61 FR 1152, Jan. 17, 1996]



                   Subpart 533.2--Disputes and Appeals



533.214  Contract clause.

    The contracting officer shall insert the clause at 552.233-70, 
Disputes (Utility Contract), in solicitations and contracts for utility 
services. This clause supplements the Disputes clause at FAR 52.233-1.



               Subpart 533.71--Processing Contract Appeals



533.7100  Definitions.

    Assigned Counsel means the attorney employed by the Office of 
General Counsel (including offices of Regional Counsel) assigned to 
provide legal review or assistance.
    Associate General Counsel means the Associate General Counsel of the 
General Law Division, Personal Property Division, or Real Property 
Division.



533.7101  Notice of appeal.

    (a) Notices of appeal are to be addressed to the GSA Board of 
Contract Appeals along with a copy to the contracting officer. Final 
decisions must be appealed within 90 calendar days from the date the 
decision of the contracting officer is received. Any request for an 
extension of the 90-day appeal period will be denied.
    (b) If the notice of appeal was mailed or otherwise submitted to the 
contracting officer in an untimely manner, a separate letter, signed by 
the contracting director, shall be sent to the AGC, requesting that a 
motion for dismissal of the appeal be submitted to the GSA Board of 
Contract Appeals (the Board). The letter shall state the name of the 
appellant, contract number, and date of the contracting officer's final 
decision, and must be accompanied by (1) the certified mail receipt 
showing the date on which the appellant received the contracting 
officer's final decision, and (2) the envelope which contained the 
notice of appeal or other evidence of late submission of the notice of 
appeal.



533.7102  Contents of notices of appeal.

    A notice of appeal must be in writing and should indicate that an 
appeal is

[[Page 390]]

thereby intended, should identify the decision and the date thereof from 
which the appeal is taken, the GSA office cognizant of the dispute, and 
the number of the contract in question. The appeal should 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 which are considered to be important. The notice of appeal 
must 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.



533.7103  Appeal files.

    (a) Appeal files must be prepared in accordance with this section 
and forwarded, after concurrence by assigned counsel, to the appropriate 
AGC within 20 calendar days after receipt of the notice of appeal or 
advice that an appeal has been filed unless the AGC advises that the 
Board requires a shorter period under its small claims procedures. In 
the event the time for submission of the appeal file cannot be met, the 
contracting officer shall submit in writing a full explanation and a 
request for additional time to the AGC, before expiration of the 
designated time.
    (b) Upon receipt of the notice of appeal, the contracting activity 
must establish a record to ensure the timely preparation and submission 
of appeal cases. The record must show, as a minimum, the name of the 
appellant, the date of the contracting officer's final decision, the 
date the appeal was filed, contract number, docket number, and name of 
the contracting officer.



533.7103-1  Preparation of the appeal file.

    (a) General. Appeal files must be prepared in quadruplicate. Each 
file is identified by the name of the appellant, contract number, and 
docket number. All copies of the appeal file must be identical both as 
to content and position of items. If more than one appeal is filed under 
the same contract, upon request to, and waiver by, the Board, the appeal 
file for the second and subsequent appeals need not duplicate the 
documents included in the first appeal file, but must make reference to 
the appeal file which contained such documents, including the docket and 
item numbers. However, if changes to such documents occur subsequent to 
preparation of the original file, these changes must be appropriately 
identified and included in the later appeal file. Such files must also 
include any documents pertinent to the later appeal but not previously 
furnished.
    (b) Content of appeal file. (1) Each appeal file must be assembled 
in a looseleaf binder. A gummed label (NSN 7510-00-264-5460) must be 
used on top of the looseleaf binder to identify the case by contractor, 
contract number and docket number.
    (2) Individual appeal files must not be more than 1 inch thick. If 
the file will be more than 1 inch thick, two or more consecutive binders 
must be used and identified with the appropriate exhibit numbers 
contained in each.
    (3) Each document to be included in the appeal file (i.e., letter, 
telegram, memo, report, invoice, etc.) must be legible, complete, 
included as a separate exhibit in the file, and listed in the ``Index of 
Exhibits'' by exhibit number and brief description. If a document cannot 
be legibly reproduced, the unaltered document must be submitted with an 
attached accurate typewritten transcription thereof. Assigned counsel 
will assist the contracting officer in determining which documents are 
relevant to the issue in the appeal or not privileged for inclusion in 
the appeal file.
    (4) Each appeal file must contain division sheets separating the 
different documents listed in the ``Index of Exhibits.'' Division sheets 
must be tabbed and numbered consecutively commencing with number one, in 
whole Arabic numbers (no letters, decimals, or fractions), and 
continuously from each file to the next so that the complete appeal file 
will consist of one set of consecutively numbered appeal file exhibits. 
In addition, the pages within the exhibit shall be numbered 
consecutively unless the exhibit already is paginated in a logical 
manner. Consecutive pagination of the entire file is not required.

[[Page 391]]

    (c) Arrangement of documents. (1) The first (top) document in the 
appeal file must be the ``Index of Exhibits.'' The index must list, 
opposite each exhibit number, the date and a brief description of the 
document and must indicate which exhibits, if any, have been filed with 
the Board but not served on the other party because of their length or 
bulk. The exhibits must be arranged in chronological order, earliest 
document first (as exhibit 1), and be separated by tabs for 
identification. For example:

                                                                        
------------------------------------------------------------------------
                                                     Exhibit      Date  
------------------------------------------------------------------------
Copy of basic contract, including referenced terms                      
 and conditions and any amendments................          1    5/20/88
Notice of award...................................          2    5/20/88
Notice to proceed and facsimile of Post Office                          
 receipt..........................................          3     6/5/88
Contractor's request for final decision or other                        
 documents of claim in response to which the                            
 decision was issued..............................          4     8/5/88
Contracting officer's final decision letter                             
 applicable to the dispute and facsimile of Post                        
 Office receipt...................................          5    8/25/88
Notice of Appeal with attachment, if any..........          6    9/10/88
Board of Contract Appeals acknowledgement of                            
 contractor's Notice of Appeal....................          7    9/15/88
------------------------------------------------------------------------

    (2) In addition to the exhibits listed in (c)(1) of this section, 
other pertinent exhibits, such as the following, should be included and 
exhibited as applicable, in chronological order:
    (i) Copy of the repurchase contract, including referenced terms and 
conditions.
    (ii) Copies of specifications/drawings applicable to the dispute.
    (iii) Copy of the abstract of offers and list of all offerors 
solicited for the repurchase contract.
    (iv) Copy of letter of assessment, including worksheet showing 
calcula- tion of excess costs and/or other damages including 
administrative costs.
    (v) Copies of defaulted purchase/delivery orders.
    (vi) Copies of purchase/delivery orders issued under the repurchase 
contract.
    (vii) Proof of payment and a detailed disbursement listing, 
annotated and certified, if applicable.

    Note:  The information and documents needed must be obtained from 
the appropriate GSA finance office. The finance information will include 
a detailed disbursement listing, annotated with the check number and 
date, and the amount applicable to the repurchase order if different 
from the check amount. The disbursement listing will be certified by an 
appropriate finance division official whose title and date of signature 
will also be shown.

    (viii) Evidence of certification of the claim or claims, as 
applicable.
    (ix) All other correspondence between the Government and the 
contractor relevant to the appeal.
    (x) All documents and other physical evidence on which the 
contracting officer relied in making a decision.
[54 FR 26543, June 23, 1989, as amended at 59 FR 22520, May 2, 1994]



533.7103-2  Transmittal of the appeal file.

    (a) The original and two copies of the appeal file must be forwarded 
to the AGC by a transmittal letter from the contracting director. The 
appeal file must be accompanied by the contracting officer's detailed 
statement of facts in a memorandum of position as a separate document 
which must be concurred in by assigned counsel who will also prepare and 
attach a statement of legal position. In addition, a list of recommended 
witnesses and the Government's estimate (when appropriate) of the amount 
of any claim in the event of an adverse decision must be prepared. A 
point of contact must be given to the AGC; name of individual, position, 
title, and telephone number.
    (b) The contracting officer shall retain one copy of the appeal 
file.
    (c) After reviewing the appeal file for adequacy, the trial attorney 
in the Office of General Counsel will transmit the appeal file to the 
Board and serve a copy of the appeal file upon appellant.



533.7104  The contracting officer's memorandum of position.

    The memorandum of position is a chronological summary of the actions 
leading to the dispute and a rationale of the contracting officer's 
actions for the information of the trial attorney. The memorandum of 
position is submitted to the AGC simultaneously with the appeal file, 
but as a separate document; i.e., it will not be included as part of the 
appeal file or included in the index. Although no particular form

[[Page 392]]

is prescribed, the statement must identify the contract, state the 
nature of the contractor's claim, cite pertinent portions of the 
contract, state the contracting officer's decision with citations to 
pertinent contract provisions and a supporting explanation, and set out 
any new facts which may have developed since the decision was made. The 
contracting officer shall sign the memorandum of position.



533.7105  Procedure following decision of the GSA Board of Contract Appeals.

    (a) Decisions of the Board will be promptly implemented. However, it 
must be recognized that the contractor may decide to appeal a Board 
decision in the United States Court of Appeals for the Federal Circuit. 
It is also possible for either party to file a motion for 
reconsideration by the Board within 30 calendar days from the date of 
the receipt of a copy of the Board decision. If further appeal of a 
decision or a motion for reconsideration of a decision is contemplated, 
the implementation of the decision may be postponed; if the issue is 
over quantum, however, consideration should be made to making payment of 
the undisputed amount to minimize interest to be paid the contractor.
    (b) The contracting officer need not take any further action (other 
than administrative) if the Board affirms the contracting officer's 
original decision, provided a recovery of costs is not due from the 
contractor. Where a recovery is due, collection must be initiated by the 
contracting officer either by (1) a contract amendment adjusting the 
contract price or (2) a written demand for immediate payment, as 
appropriate. (In excess cost cases, Office of Finance will normally 
pursue the necessary collection.) Any written demand must instruct the 
contractor to make payment to the General Services Administration and 
address it to the appropriate GSA finance office. A copy of any written 
demand must be provided to the appropriate GSA finance office for 
information and followup.
    (c) In appeals brought under the disputes clause of the contract, 
when the Board does not uphold the contracting officer's original 
decision and the Board's decision provides for payment in favor of the 
contractor, the contracting officer shall prepare a supplemental 
agreement with concurrence of assigned counsel. The supplemental 
agreement will ensure against further litigation of the same dispute. 
The contracting officer shall forward the recommendation for payment to 
the appropriate finance office with the original of the supplemental 
agreement and a copy of the Board's decision.
    (d) In appeals brought under the Contract Disputes Act of 1978, when 
the Board does not uphold the contracting officer's original decision 
and the Board's decision awards the contractor an amount of money, and 
the AGC informs the contracting officer that the Government will not 
move for reconsideration of the Board's decision or appeal it to the 
United States Court of Appeals for the Federal Circuit, the contracting 
officer must complete the Certificate of Finality attached to the copy 
of the Board's decision and return it to the Board. The Board will 
forward the Certificate of Finality, completed by both parties, and a 
certified copy of its decision to the United States General Accounting 
Office to be certified for payment to the contractor.

[[Page 393]]



             SUBCHAPTER F--SPECIAL CATEGORIES OF CONTRACTING





PART 534--MAJOR SYSTEM ACQUISITION--Table of Contents




Sec.
534.002  Policy.
534.002-70  Directives.
534.002-71  Definitions.

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

    Source:  54 FR 26547, June 23, 1989, unless otherwise noted.



534.002  Policy.



534.002-70  Directives.

    Additional policies and procedures on major systems acquisitions are 
contained in the following:
    (a) GSA Order, Major System Acquisitions in the General Services 
Administration (ADM 5400.33).
    (b) FIRMR 201-32.103, The Acquisition of Major ADP Resource Systems.
    (c) GSA Order, Major System Acquisitions in the Automated Data and 
Telecommunications Service (DTS 5400.1).



534.002-71  Definitions.

    Major system acquisitions are those that are:
    (a) Directed at and critical to fulfilling an agency mission;
    (b) Estimated to entail the allocation of $25 million or more life 
cycle cost in current year dollars; or
    (c) Determined by the Administrator to warrant special management 
attention or to be of critical importance to the agency or 
technologically advanced.



PART 535--RESEARCH AND DEVELOPMENT CONTRACTING--[RESERVED]






PART 536--CONSTRUCTION AND ARCHITECT-ENGINEER CONTRACTS--Table of Contents




                         Subpart 536.1--General

Sec.
536.101  Applicability.
536.102  Definitions.

     Subpart 536.2--Special Aspects of Contracting for Construction

536.201  Evaluation of contractor performance.
536.202  Specifications.
536.203  Government estimate of construction cost.
536.204  Disclosure of the magnitude of construction projects.

    Subpart 536.3--Special Aspects of Sealed Bidding in Construction 
                               Contracting

536.303-70  Bids that include alternates.
536.303-71  Bids that include options.
536.303-72  Bids that include alternates and options.
536.370  Exercise of options.

                     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  Furnishing information and records.

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

    Source:  54 FR 26548, June 23, 1989, unless otherwise noted.



                         Subpart 536.1--General



536.101  Applicability.

    Other requirements of this regulation are generally applicable to 
construction and architect-engineer contracts. However, if a requirement 
in this part is inconsistent with a requirement in another part of this 
regulation, this part takes precedence.



536.102  Definitions.

    Construction activity means the organizational level of the agency 
that has

[[Page 394]]

authority and responsibility for the architectural, engineering, and 
other technical or administrative aspects of design and construction.
    Statutory cost limitations, as used in this part, means the cost 
limits that may be included in the agency's statutory authorization or 
annual appropriations act (by law).



     Subpart 536.2--Special Aspects of Contracting for Construction



536.201  Evaluation of contractor performance.

    (a) The construction activity shall prepare a performance report for 
each construction contract of $25,000 or more, and each construction 
contract where any element of performance was unsatisfactory or 
outstanding.
    (b) Each regional construction activity shall establish an 
evaluation report file with procedures for maintaining alphabetically 
the evaluation reports, for cross referencing all names under which a 
contractor does business with GSA, and for ensuring that fully qualified 
personnel possessing the knowledge of the contractor's performance 
prepare and review the evaluation reports.
[58 FR 52445, Oct. 8, 1993]



536.202  Specifications.

    Under the Resource Conservation and Recovery Act of 1976, 42 U.S.C. 
6962, the Environmental Protection Agency has promulgated rules in 40 
CFR Parts 248 and 249, regarding the use of certain waste by-products as 
generally acceptable substitutes for energy-intensive raw materials. The 
rules provide that when certain construction material containing energy 
intensive raw material is required that the technical specification 
allows as an alternate, construction material containing certain waste 
byproducts. However, specifications should not be revised to allow the 
use of the alternate material if it is found that performance 
requirements for the construction material would not be met or that the 
use of the alternate material would be unsatisfactory for technical 
reasons.



536.203  Government estimate of construction cost.

    (a) A copy of the independent Government estimate must be sealed in 
an envelope and submitted to the contracting officer before the date and 
time for bid opening or the date for receipt of proposals. (See 
paragraphs (b) and (c) of this section.)
    (b) If the procurement is by sealed bidding, the sealed copy of the 
Government estimate must be stored with the bids received until bid 
opening. Before releasing an amendment to a solicitation that may affect 
the price, a revised sealed Government estimate must be stored with the 
bids until bid opening. After the bids are read and recorded, the sealed 
Government estimate will be opened and retained with abstract of offers 
(See Optional Forms 1419 and 1419A). However, the Government's estimate 
must not be disclosed until after award. Immediately after award the 
Government estimate must be recorded on the abstract of offers as the 
Independent Government Estimate.
    (c) If the procurement is by negotiation, the sealed copy of the 
Government estimate must be stored with the proposals until the closing 
time for receipt of proposals. Cost figures in the Government estimate 
may be disclosed during negotiation, but only to the extent considered 
necessary for arriving at a fair and reasonable price, provided that the 
overall amount of the Government estimate is not disclosed before award. 
Before the release of a modification to the solicitation which may 
affect price, a revised Government estimate must be prepared, sealed, 
and stored, with the proposals until closing time for proposals. After 
award, the independent Government estimated price may be revealed, upon 
request, to those firms or individuals who submitted proposals.
    (d) The Government estimate must be used to evaluate offers, as a 
guide in conducting contract negotiations or negotiations of contract 
modifications, and as a tool for determining the reasonableness of 
prices.
[58 FR 52445, Oct. 8, 1993]

[[Page 395]]



536.204  Disclosure of the magnitude of construction projects.

    The magnitude of construction projects in excess of $10,000,000 
should be shown in increments of $10,000,000 (e.g. $20,000,000 to 
$30,000,000).



    Subpart 536.3--Special Aspects of Sealed Bidding in Construction 
                               Contracting



536.303-70  Bids that include alternates.

    (a) The base bid must include all features that are essential to a 
sound and adequate building design. However, if it appears that funds 
available for a project may be insufficient to include all desired 
features in the base bid, the contracting officer may issue a 
solicitation for a base bid and include one or more alternates in the 
order of priority. Alternates may be used only when they are clearly 
justified and should involve substantial amounts of work in relation to 
the base bid. Their use must be limited and should involve only ``add'' 
alternates.
    (b) The language used in soliciting alternates must be approved in 
writing by counsel.
    (c) Before opening bids that include alternates, the contracting 
officer shall 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 and must be the controlling factor 
in determining the low bidder. This amount may be increased later when 
determining the alternate items to be awarded to the low bidder, 
provided that the award amount of the base bid plus the combination of 
alternate items do not exceed the amount offered by any other 
responsible bidder whose bid conforms to the solicitation for the base 
bid and the same combination of alternate items.
[58 FR 52445, Oct. 8, 1993]



536.303-71  Bids that include options.

    (a) Subject to the limitations in paragraph (c) of this section, the 
contracting officer may include options in contracts when it is in the 
Government's interest.
    (b) The appropriate use of options may include, but is not limited 
to, the following:
    (1) When additional work is anticipated but funds are not expected 
to be available at the time of award, and it would not be practicable to 
award a separate contract or to permit an additional contractor to work 
on the same site.
    (2) When fixed building equipment, e.g. elevators, escalators, etc., 
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) The contracting officer shall not employ options if:
    (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; or
    (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) The solicitations must state whether the basis of award is 
inclusive or exclusive of the options. Before a solicitation that 
includes evaluated options is issued, the contracting officer shall make 
a determination that there is reasonable certainty that funds will be 
made available to permit exercise of the option.
    (f) The language of all solicitation provisions for options must be 
approved, in writing, by counsel.
[54 FR 26548, June 23, 1989, as amended at 58 FR 52445, Oct. 8, 1993]



536.303-72  Bids that include alternates and options.

    (a) Solicitations may include alternates and options when the 
conditions in 536.303-70, Bids that include alternates, and 536.303-71, 
Bids that include options, are satisfied. In such solicitations, the low 
bidder for purposes of award is the responsible bidder offering the 
lowest aggregate price for the base bid plus those alternates in the 
order of priority listed in the solicitation that

[[Page 396]]

provide the most features of work within the funds available at bid 
opening, plus all options designated to be evaluated.
    (b) In the case of options associated with alternates, the basis of 
award may require the evaluation of such options if the related 
alternate is selected.
    (c) Before opening bids that include alternates and options, the 
contracting officer shall 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, provided that the 
award amount of the base bid and evaluated options plus such a 
combination of alternate items does not exceed the amount offered by any 
other responsible bidder whose bid conforms to the solicitation for the 
base bid, the evaluated options, and the same combination of alternate 
items.
[54 FR 26548, June 23, 1989, as amended at 58 FR 52445, Oct. 8, 1993]



536.370  Exercise of options.

    (a) When exercising an option, the contracting officer shall notify 
the contractor, in writing, within the time period specified in the 
contract.
    (b) The contracting officer may exercise options only after 
determining that:
    (1) Funds are available;
    (2) The requirement covered by the option fulfills an existing 
Government need; and
    (3) The exercise of the option is the most advantageous method of 
fulfilling the Government's need, price and other factors considered.
    (c) Before exercising an option, the contracting officer shall 
determine that such action is in accordance with the terms of the option 
and the requirements of this section. The written determination must be 
included 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. In addition, when exercising an unpriced 
and/or unevaluated option cite the statutory authority permitting the 
use of other than full and open competition (see FAR 6.302 and 517.207).



                     Subpart 536.5--Contract Clauses



536.570  Supplemental provisions and clauses.



536.570-1  Definitions.

    The contracting officer shall insert the clause at 552.236-70, 
Definitions, in solicitations and contracts when construction, 
dismantling, demolition, or removal of improvements is contemplated.



536.570-2  Authorities and limitations.

    The contracting officer shall insert the clause at 552.236-71, 
Authorities and Limitations, in solicitations and contracts when 
construction, dismantling, demolition, or removal of improvements is 
contemplated and the contract amount is expected to exceed the 
simplified acquisition threshold.
[54 FR 26548, June 23, 1989, as amended at 60 FR 42804, Aug. 17, 1995]



536.570-3  Specialist.

    The contracting officer shall insert the clause at 552.236-72, 
Specialist, in construction contracts when the technical sections of the 
contract require unusual experience or specialized facilities for 
adequate contract performance.



536.570-4  Basis of award--construction contract.

    The contracting officer shall insert a provision substantially the 
same as the provisions at 552.236-73, Basis of Award--Construction 
Contract, in solicitations for fixed price construction contracts except 
when:
    (a) The solicitation requires the submission of a lump sum bid only;
    (b) The solicitation is for an indefinite quantity contract; or
    (c) The contract amount is not expected to exceed the simplified 
acquisition threshold.

If the solicitation requests the submission of a base bid and unit 
prices, the contracting officer shall use the basic provision. If the 
solicitation requests

[[Page 397]]

the submission of a base bid and options the contracting officer shall 
use the provision with its Alternate I. If the solicitation requests the 
submission of a base bid and alternates, the contracting officer shall 
use the provision with its Alternate II. If the solicitation requests 
the submission of a base bid, alternates, and options, the contracting 
officer shall use the provision with its Alternate III.
[54 FR 26548, June 23, 1989, as amended at 60 FR 42804, Aug. 17, 1995]



536.570-5  Working hours.

    The contracting officer shall insert the clause at 552.236-74, 
Working Hours, in solicitations and contracts when construction, 
dismantling, demolition, or removal of improvements is contemplated and 
the contract amount is expected to exceed the simplified acquisition 
threshold.
[54 FR 26548, June 23, 1989, as amended at 60 FR 42804, Aug. 17, 1995]



536.570-6  Use of premises.

    The contracting officer shall insert the clause at 552.236-75, Use 
of Premises, in solicitations and contracts when construction, 
dismantling, demolition, or removal of improvements is contemplated.



536.570-7  Measurements.

    The contracting officer shall insert the clause at 552.236-76, 
Measurements, in solicitations and contracts when construction, 
dismantling, demolition, or removal of improvements is contemplated.



536.570-8  Specifications and drawings.

    The contracting officer shall insert the clause at 552.236-77, 
Specifications and Drawings, in contracts when construction, 
dismantling, demolition, or removal of improvements is contemplated and 
the contract is expected to exceed the simplified acquisition threshold.
[54 FR 26548, June 23, 1989, as amended at 60 FR 42804, Aug. 17, 1995]



536.570-9  Shop drawings, coordination drawings, and schedules.

    The contracting officer shall insert the clause at 552.236-78, Shop 
Drawings, Coordination Drawings, and Schedules, in contracts when 
construction is contemplated and the contract is expected to exceed the 
simplified acquisition threshold.
[54 FR 26548, June 23, 1989, as amended at 60 FR 42804, Aug. 17, 1995]



536.570-10  Samples.

    The contracting officer shall insert the clause at 552.236-79, 
Samples, in construction contracts when the technical sections of the 
contract require the submission and approval of samples.



536.570-11  Heat.

    The contracting officer shall insert the clause at 552.236-80, Heat, 
in contracts, as appropriate, when construction, dismantling, 
demolition, or removal of improvements is contemplated.



536.570-12  Use of equipment by the Government.

    The contracting officer shall insert the clause at 552.236-81, Use 
of Equipment by the Government, in contracts requiring heating and air-
conditioning of existing buildings when 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.

    The contracting officer shall insert the clause at 552.236-82, 
Subcontracts, in solicitations and contracts for construction when the 
contract is expected to exceed the simplified acquisition threshold.
[54 FR 26548, June 23, 1989, as amended at 60 FR 42804, Aug. 17, 1995]



536.570-14  Furnishing information and records.

    The contracting officer shall insert the clause at 552.236-83, 
Furnishing Information and Records, in solicitations and contracts when 
construction, dismantling, demolition or removal of improvements is 
contemplated and the contract amount is expected to exceed the 
simplified acquisition threshold.
[54 FR 26548, June 23, 1989, as amended at 60 FR 42804, Aug. 17, 1995]

[[Page 398]]



PART 537--SERVICE CONTRACTING--Table of Contents




                Subpart 537.1--Service Contracts--General

Sec.
537.101  Definitions.
537.106  Funding and term of service contracts.
537.110  Solicitation provisions and contract clauses.

             Subpart 537.2--Advisory and Assistance Service

537.205  Management controls.

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

    Source:  54 FR 26551, June 23, 1989, unless otherwise noted.



                Subpart 537.1--Service Contracts--General



537.101  Definitions.

    Building service contract means a contract for services relating to 
the operation and maintenance of a building, e.g., janitorial; window 
washing; snow removal; trash removal; lawn and grounds care; inspection, 
maintenance and repair of fixed equipment (elevators, air-conditioning, 
and heater systems, etc.) and protection or guard service.



537.106  Funding and term of service contracts.

    The Federal Property and Administrative Services Act of 1949, as 
amended (41 U.S.C. 260), authorizes GSA to enter into contracts for 
periods not to exceed three years for the operation, maintenance, and 
repair of fixed building equipment in Federally owned buildings (40 
U.S.C. 490(a)(14)) and contracts for periods not exceeding ten years for 
utility services (40 U.S.C. 481(a)(3)). Contracts for these services may 
be awarded for the performance periods indicated without an 
``Availability of Funds'' clause.



537.110  Solicitation provisions and contract clauses.

    (a) The contracting officer shall insert the provision at 552.237-
70, Qualifications of Offerors, in solicitations and contracts for 
building services when the contract amount is expected to exceed the 
small purchase limitation.
    (b) The contracting officer shall insert the clause at 552.237-71, 
Qualifications of Employees, in solicitations and contracts for building 
services when the amount is expected to exceed the small purchase 
limitation. Supplemental clauses may be used with the clause at 552.237-
71 to outline specific requirements regarding employees who will perform 
work on contracts.
    (c) The contracting officer shall insert the certification at 
552.237-72, Certification Regarding ``Quasi-Military Armed Forces,'' in 
solicitations and contracts for guard service.



             Subpart 537.2--Advisory and Assistance Service



537.205  Management controls.

    All requests for advisory and assistance services must be processed 
in accordance with the requirements of GSA Order, Procurement of 
Consulting Services (ADM 2800.12D).



PART 538--FSS SCHEDULE CONTRACTING--Table of Contents




         Subpart 538.2--Establishing and Administering Schedules

Sec.
538.203  Solicitation preparation.
538.203-71  Solicitation provisions and contract clauses.
538.270  Evaluation of multiple award schedule offers.
538.271  MAS contract awards.
538.272  MAS price reductions.

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



         Subpart 538.2--Establishing and Administering Schedules



538.203  Solicitation preparation.



538.203-71  Solicitation provisions and contract clauses.

    (a) The contracting officer shall insert the clause at 552.238-72, 
Contractor's Report of Sales, in solicitations issued and contracts 
awarded under GSA's schedule program. Paragraph (b) may be modified as 
necessary to meet

[[Page 399]]

program requirements. If it is necessary to identify the official 
responsible for preparing the report, the contracting officer may use 
the clause with its Alternate I. When the clause is used by IRMS the 
contracting officer shall use the clause with its Alternate II.
    (b) The contracting officer shall insert the clause at 552.238-70, 
Identification of Electronic Office Equipment Providing Accessibility 
for the Handicapped, in solicitations and contracts awarded under the 
multiple award schedule program when the solicitation includes 
electronic office equipment.
    (c) The contracting officer shall insert the clause at 552.238-74, 
Submission and Distribution of Authorized GSA Schedule Pricelists, in 
solicitations and contracts awarded under the multiple award schedule 
program. When GSA is not prepared to accept electronic submissions for a 
particular schedule, the contracting officer is authorized to modify the 
clause by deleting subparagraph (c)(1)(ii) and (c)(3) and modifying 
subparagraph (c)(1) to eliminate ``(i)'' and the word ``and'' at the end 
of subparagraph (i).
    (d) The contracting officer shall insert the clause at 552.238-75, 
Identification of Energy-Efficient Office Equipment and Supplies 
Containing Recovered Materials or Other Environmental Attributes, in 
solicitations and contracts awarded for supplies under the multiple 
award schedule program.
    (e) Contracting officers shall insert the clause at 552.238-76, 
Price Reductions, in all MAS solicitations and contracts.
    (f) Contracting officers in the Federal Supply Service (FSS) shall 
insert the clause at 552.238-77, Industrial Funding Fee, in 
solicitations and contracts awarded under the single award schedule and 
multiple award schedule programs.
[56 FR 29443, June 27, 1991, as amended at 58 FR 54524, Oct. 22, 1993; 
59 FR 3657, Jan. 26, 1994; 59 FR 52451, Oct. 18, 1994; 59 FR 63260, Dec. 
8, 1994; 60 FR 19361, Apr. 18, 1995]



538.270  Evaluation of multiple award schedule 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 
that there may be legitimate reasons why the best price is not achieved.
    (b) The contracting officer will establish negotiation objectives 
based on a review of relevant data and determine price reasonableness.
    (c) When establishing negotiation objectives and determining price 
reasonableness, contracting officers will compare the terms and 
conditions of the MAS solicitation with the terms and conditions of 
agreements with the offeror's commercial customers. The contracting 
officer will consider the following factors when determining the 
Government's price negotiation objectives:
    (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; and
    (7) Any other relevant information including differences between the 
MAS solicitation and commercial terms and conditions that may warrant 
differentials between the offer and the best prices offered to the most 
favored commercial customer(s). For example, if it is more expensive for 
an offeror to sell to the Government than to the customer who receives 
the offeror's best price or if the customer (e.g., dealer, distributor, 
OEM, other reseller) who receives the best price performs certain value-
added functions for the offeror that the Government does not perform, 
then some reduction in the discount given to the Government may be 
appropriate. In cases where the best price is not offered to the 
Government, the contracting officer should ask the offeror to identify 
and explain the reason for any differences. Offerors shall not be 
required to provide detailed cost breakdowns.

[[Page 400]]

    (c) The contracting officer may award a contract containing pricing 
which is less favorable than the best price the offeror extends to any 
commercial customer for similar purchases, when the contracting officer 
makes a determination that:
    (1) The prices offered to the Government are fair and reasonable 
even though comparable discounts were not negotiated, and
    (2) Award of a contract is otherwise in the best interest of the 
Government.
[62 FR 44523, Aug. 21, 1997]



538.271  MAS contract awards.

    (a) MAS awards will be for commercial items as defined in FAR 2.101. 
Contracts will be negotiated as a discount from established catalog 
prices.
    (b) Before awarding any MAS contract, the contracting officer will 
determine whether offered prices are fair and reasonable in accordance 
with FAR subparts 15.8 and 15.9 and 48 CFR 538.270.
[61 FR 6169, Feb. 16, 1996, as amended at 62 FR 44524, Aug. 21, 1997]



538.272  MAS price reductions.

    (a) Prior to the award of a MAS contract, the contracting officer 
and the offeror shall reach an agreement as to the customer (or category 
of customers), price lists, and discounts which will serve as the basis 
of contract award. The award document shall expressly state the price/
discount relationship between the Government and the identified 
commercial customer which is the basis of contract award. The Price 
Reductions clause is intended to maintain this price/discount 
relationship (and/or term and condition relationship) between the 
Government and the offeror's customer or category of customers upon 
which the MAS contract was predicated for the contract period.
    (b) During the term of the contract, any changes in discount/pricing 
practices by the contractor which result or will result in a less 
advantageous relationship between the Government and the customer or 
category of customers upon which the MAS contract discount/price was 
predicated, shall result in a price reduction to the Government to the 
extent necessary to reflect the original relationship.
[59 FR 52451, Oct. 18, 1994]



PART 539--MANAGEMENT, ACQUISITION, AND USE OF INFORMATION RESOURCES  [RESERVED]






PART 540--[RESERVED]






PART 541--ACQUISITION OF UTILITY SERVICES--Table of Contents




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



                      Subpart 541.4--Administration



541.401  Monthly and annual review.

    Unless other procedures are established, the contracting officer 
shall perform or cause to be performed the reviews required by FAR 
41.401.
[60 FR 54956, Oct. 27, 1995]

[[Page 401]]



                    SUBCHAPTER G--CONTRACT MANAGEMENT





PART 542--CONTRACT ADMINISTRATION--Table of Contents




          Subpart 542.2--Assignment of Contract Administration

Sec.
542.200-70  Policy.
542.201  Definitions.
542.202  Assignment of contract administration.

         Subpart 542.3--Contract Administration Office Functions

542.302  Contract administration functions.

                Subpart 542.4--Correspondence and Visits

542.470  Implementation.

                   Subpart 542.7--Indirect Cost Rates

542.703  Policy.

          Subpart 542.11--Production Surveillance and Reporting

542.1107  Contract clause.

         Subpart 542.12--Novation and Change-of-Name Agreements

542.1203  Processing agreements.

   Subpart 542.70--Bankruptcy, Insolvency or Dissolution of a Business

542.7001  General.
542.7002  Procedures.

              Subpart 542.71--Audit of Contractor's Records

542.7101  General.
542.7102  Purpose of audit.
542.7103  Types of contracts subject to audit.
542.7104  Additional internal controls.
542.7105  Releasing or withholding of audit reports.

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

    Source:  54 FR 26551, June 23, 1989, unless otherwise noted.



          Subpart 542.2--Assignment of Contract Administration



542.200-70  Policy.

    (a) Contracting directors shall establish procedures that will 
ensure that contract administration activities are performed by 
qualified personnel and in an effective manner.
    (b) Contract administration may be performed by the contracting 
officer who awarded the contract or by an administrative contracting 
officer (ACO) within the contracting office. As an alternative, 
management may establish a separate contract administration office (CAO) 
consistent with the nature and complexities of the contracts, the need 
to perform contract administration at or near the contractor's facility 
or the place of performance, and the availability of resources.
    (c) The contracting officer may designate one or more 
representatives to perform specified functions such as quality 
assurance, production, price analysis, finance and various engineering 
and technical specialities. These representatives may not enter into or 
modify a contract or otherwise perform functions reserved for a 
contracting officer except to the limited extent permitted for 
construction contracts. (See 542.201.2(d).) Designations of ACOs and 
contracting officers representatives must be in writing and communicated 
to the contractor.



542.201  Definitions.

    Assignment of contract administration means that process whereby 
identified functions, duties, or responsibilities related to the 
administration of contracts are assigned to a CAO or an ACO within a 
contracting office.
    Contract administration means the performance of actions after 
contract award that the Government takes to obtain compliance with 
contract requirements, including timely delivery of supplies or 
services, acceptance, payment, and closing of the contract. These 
actions include technical, financial, audit, legal, administrative, and 
managerial services in support of the contracting officer. It may 
include additional tasks requested or needed by the contracting activity 
including support in the pre-award phase of contracting.
    Contracting Officer's Representative (COR), Contracting Officer's 
Technical

[[Page 402]]

Representative (COTR), or Contract Administrator means an individual 
designated and authorized in writing by the contracting officer to 
perform specific limited contract administration activities.
    Procuring Contracting Officer (PCO) means, a contracting officer 
(see FAR Subpart 2.1). This regulation uses the term to differentiate 
between procuring and administrative responsibilities when contract 
administration authority has been delegated to an ACO within a 
contracting office or a CAO.



542.202  Assignment of contract administration.

    (a) The contracting officer may delegate to an ACO functions not 
listed in FAR 42.302 and 542.302(b) provided that:
    (1) The requirements of FAR 42.202(c) are met and,
    (2) The Associate Administrator for Acquisition Policy approves the 
additional delegation. Requests for additional delegations must be 
submitted through the appropriate Central Office Service Commissioner or 
Assistant Administrator of the appropriate service or staff office to 
the Office of Acquisition Policy. If a service/office is providing 
contracting support for another service/office the request shall be sent 
to the Commissioner/Assistant Administrator of the contracting service/
office. That official shall coordinate as necessary with the affected 
service/office.
    (b) In addition to the requirements of FAR 42.202(d), the 
contracting officer shall provide or make available a complete copy of 
the contract file to the ACO.



         Subpart 542.3--Contract Administration Office Functions



542.302  Contract Administration functions.

    (a) Normal contract administration functions identified at FAR 
42.302(a) are to be performed, to the extent they apply, either by the 
contracting office or an office specifically established to perform 
contract administration functions.
    (b) The ACO or CAO shall perform the additional functions listed 
below only when and to the extent specifically authorized by the 
contracting officer.
    (1) Negotiate and issue priced or unpriced orders under indefinite 
delivery type contracts and basic ordering agreements.
    (2) Issue change orders to modify the method of shipment, the 
packing requirements, the place where supplies are to be delivered, or 
the specifications after coordinating with the PCO (only applies to 
ACO's in FSS).
    (3) Accept/reject requests for acceptance of nonconforming supplies 
after coordinating with the PCO if other than a minor nonconformance is 
involved (only applies to ACO's in the Federal Supply Service (FSS)).
    (4) Negotiate price adjustments and execute supplemental agreements 
resulting from acceptances in (b)(3) of this section.
    (5) Issue cure or show cause notices under FAR 49.402-3(b) after 
coordinating with the PCO (only applies to ACO's in FSS).
    (6) Terminate individual purchase/delivery orders after coordinating 
with the PCO.
    (7) Terminate the contract for default after coordinating with the 
PCO (only applies to ACO's in FSS).
    (8) Assess liquidated damages.
    (c) Functions peculiar to specific programs may be delegated when 
approved by the Associate Administrator for Acquisition Policy. Requests 
to delegate contract administration functions not found in FAR 42.302 
and 542.302(b) must be submitted to the Office of Acquisition Policy by 
the head of the affected Central Office service for approval.
[54 FR 26551, June 23, 1989, as amended at 58 FR 52445, Oct. 8, 1993]



                Subpart 542.4--Correspondence and Visits



542.470  Implementation.

    HCA's issuing implementing guidelines or procedures must obtain the 
concurrence of the Associate Administrator for Acquisition Policy.

[[Page 403]]



                   Subpart 542.7--Indirect Cost Rates



542.703  Policy.

    The contracting directors may waive the certification requirement 
under FAR 42.703-2.
[60 FR 54957, Oct. 27, 1995]



          Subpart 542.11--Production Surveillance and Reporting



542.1107  Contract clause.

    The contracting officer shall insert the clause at 552.242-70, 
Status Report of Orders and Shipments, in solicitations and indefinite 
quantity and requirements contracts for stock or special order program 
items. The clause may also be used in indefinite delivery definite 
quantity contracts for stock or special order program items when close 
monitoring is necessary because numerous shipments are involved.



         Subpart 542.12--Novation and Change-of-Name Agreements



542.1203  Processing agreements.

    In determining whether it is in the Government's interest to 
recognize a successor in interest under FAR Subpart 42.12, the 
contracting officer shall consider, in addition to information provided 
by affected contracting and contract administration offices, information 
provided by the agency small business technical advisor where the 
contract was awarded to a small business under a small business set-
aside and the third-party successor is a large business. Under the 
following conditions the contracting officer should refuse to recognize 
the successor and nonconcur in the transfer of the contract(s):
    (a) There is adequate reason to believe that the transaction is 
intended to circumvent the requirements and objectives of the small 
business program; or
    (b) The contract involved is a multiple award schedule (MAS) 
contract and other MAS small business contracts exist for the same 
special item number(s). If the MAS contract involves both set-aside and 
non-set-aside special item numbers, the contracting officer shall cancel 
that part of the contract related to the set-aside items, and process 
the novation request for the non-set-aside items under FAR Subpart 
42.12.



   Subpart 542.70--Bankruptcy, Insolvency or Dissolution of a Business



542.7001  General.

    Prompt action is vital when a contractor becomes insolvent or files 
under any of the laws relating to bankruptcy, insolvency, and 
dissolution of businesses (11 U.S.C. 101 et. seq.) to assure that the 
Government's rights are protected. Terminated and current contracts with 
the contractor must be considered in any action contemplated. 
Contracting officers may be advised of such difficulties by the quality 
assurance specialist (QAS), contracting officer's representatives (COR), 
the Office of Finance, the Office of Inspector General, or other means, 
e.g., newspaper items, Dun and Bradstreet, an industry association, 
other contractors, other Federal agencies, or financial institutions. 
The contracting officer shall verify the accuracy of the information 
received and follow the procedures in 542.7002.



542.7002  Procedures.

    (a) When a contractor is experiencing financial difficulties the 
contracting officer shall:
    (1) Determine whether the contractor is delivering supplies and/or 
performing the services within the timeframes specified in the contract 
and whether the contractor is making satisfactory progress toward future 
deliveries or performance. Obtain, if needed, the recommendations of the 
QAS or COR.
    (2) If the contractor has failed without excuse to deliver or 
perform under the contract or has failed to make progress so as to 
endanger performance, consider terminating the contract for default.
    (3) If contract termination is not considered necessary, continue to 
monitor contract(s) by requesting that the QAS or COR visit the 
contractor's plant or the work site more often than usual to ascertain 
that progress is being made.
    (4) If a small business contractor is involved, notify the regional 
Small

[[Page 404]]

Business Administration (SBA) office and the agency Small Business 
Technical Advisor.
    (5) If the contract has a performance bond and/or payment bond, the 
bonding company should be notified if the circumstances of the 
particular case dictate such notification.
    (b) When a contractor has filed for bankruptcy, the contracting 
officer shall:
    (1) Notify the contracting director, assigned counsel, the Office of 
Finance and other interested parties.
    (2) Determine whether the contractor is performing in accordance 
with the terms of the contract and/or is making satisfactory progress 
towards completion of the contract. If the contractor has failed without 
excuse to deliver or perform under the contract or failed to make 
progress so as to endanger performance, consider terminating the 
contract for default. Termination must not be effected without 
concurrence of assigned counsel, who will coordinate with the assigned 
Assistant United States Attorney.
    (3) Determine the status of and provide for the protection and 
disposition of Government-owned property, if applicable.
    (4) If special safeguards for Government property are needed, 
determine the names, addresses, and phone numbers of the local 
Government officials concerned in the bankruptcy proceedings, e.g., 
sheriff, marshal, or the Receiver or Trustee in bankruptcy, if assigned.
    (5) Transmit immediately all relevant communications to assigned 
counsel; e.g., notice of bankruptcy, notice of meeting of creditors, 
plan of arrangement, status of such plan, claims bar date and address of 
the Bankruptcy Court where proceedings were filed. Assigned counsel 
shall immediately transmit a copy of the notice of bankruptcy to the 
appropriate office in the Office of General Counsel (i.e., LG, LP, or 
LR) or to the assigned Assistant United States Attorney.
    (6) Prepare, in consultation with assigned counsel, the preliminary, 
contingent and, after reprocurement (if any), final proof of claim. Such 
proofs of claim will be forwarded by the assigned counsel to the 
appropriate office in the Office of General Counsel (i.e., LG, LP, or 
LR) or to the assigned Assistant United States Attorney.
    (7) Consult with assigned counsel regarding possible setoffs of 
Government claims from retained and unpaid contractor earnings.
    (8) Advise the Inspector General whenever there is reason to believe 
that the contractor may have fraudulently transferred assets before 
filing for bankruptcy. Also advise the Inspector General in any case 
where the contracting officer is aware of an ongoing audit or 
investigation of the contractor.
    (c) Upon receipt of information that a contractor intends to 
dissolve a business or to cease operations for whatever reason, e.g., 
because of retirement, fire sale of business (without public notice), 
etc., the contracting officer shall verify the accuracy of the 
information. If the information is accurate, the contracting officer 
shall request the QAS or COR to verify status of contract(s) and notify 
other directly interested parties. However, the QAS or COR should not be 
requested to make special contract administration visits unless all 
other efforts to obtain the necessary information have failed. If a 
claim against the contractor is either pending or outstanding, the 
contracting officer should notify assigned counsel and simultaneously 
obtain information that would aid in finalizing the amount of claim(s).



              Subpart 542.71--Audit of Contractor's Record



542.7101  General.

    The Assistant Inspector General--Auditing and the Field Audit 
Offices audit contractors' records when required by law, regulation, or 
sound business judgment. These audits include periodic or special 
request audits of contractors determined to be necessary because of such 
matters as the financial condition, integrity, and reliability of the 
contractor and prior audit experience, adequacy of the accounting 
system, and the amount of unaudited claims. So that the Government can 
benefit to the maximum extent from these audits, a coordinated and 
cooperative effort must be made by

[[Page 405]]

contracting officers, technical specialists, and finance and audit 
personnel.



542.7102  Purpose of audit.

    Audits are conducted to advise and make recommendations to the 
contracting officer concerning:
    (a) Propriety of amounts paid, or to be paid, by GSA to contractors 
when such amounts are based on a cost or time determination or on 
variable features related to the results of contractors' operations;
    (b) Adequacy of measures taken by contractors regarding the use and 
safe-guarding of Government assets under their custody or control;
    (c) Compliance by contractors with contractual provisions such as 
progress payments, advance payments, guaranteed loans, cash return 
provisions, and price adjustments; and
    (d) Reasonableness of contractor's termination settlement proposals.



542.7103  Types of contracts subject to audit.

    (a) The following types of contracts, (excluding small purchases) 
include either the Audit-Negotiation clause prescribed in FAR 15.106-2 
or the Examination of Records by GSA clause at 552.215-70 and are 
subject to audit.
    (1) Cost-reimbursement type contracts;
    (2) Contracts involving the use or disposition of Government-
furnished property;
    (3) Contracts that provide for advance payments, progress payments 
based on costs, or guaranteed loans;
    (4) Contracts containing a price warranty or price reduction clause;
    (5) Contracts or leases involving income to the Government when the 
income is based on operations that are under the control of the 
contractor or lessee;
    (6) Fixed-price contracts or leases with economic price adjustment, 
with incentives and with price redetermination;
    (7) Requirements and indefinite quantity (call-type) contracts;
    (8) Time-and-material, labor-hour, and letter contracts; and
    (9) Leases when the rental is subject to adjustment based on 
negotiated operating cost escalation.
    (b) A copy of each contract or modification of the types described 
in paragraph (a) of this section must be furnished to the Assistant 
Inspector General for Auditing (JA), General Services Administration, 
Washington, DC 20405, or to the Field Audit Office, as appropriate, 
simultaneously with distribution of other copies of the contract.



542.7104  Additional internal controls.

    As a supplement to the contractual right to audit contractor records 
in cost-reimbursement type, time and materials, labor-hour, requirements 
and indefinite quantity (call-type) contracts, the contracting officer 
(with the assistance of the Assistant Inspector General--Auditing or the 
Field Audit Office) shall establish internal controls or procedures 
prior to the performance of those contracts with respect to any flexible 
or variable features. For example, if a time and materials or labor-hour 
contract is performed (on a Government facility or elsewhere) subject to 
observation or overall supervision by Government personnel approval of 
time records may be provided for as incidental to the Government 
supervision. Any reasonable and reliable method or procedure may be 
established to account for such matters as the time spent on the job and 
materials or supplies received which will assist the contract auditor 
and the contracting officer to determine the correctness of the charges 
to the contract.



542.7105  Releasing or withholding of audit reports.

    The Freedom of Information Act generally requires the disclosure of 
Government records subject to certain exceptions. It may be to the 
benefit or detriment of the Government to release contract audit reports 
or portions of them depending upon the circumstances. However, because 
of the complexity of the matter, contracting officers shall consult with 
both the Assistant Inspector General-Auditing and the Office of General 
Counsel, before releasing or withholding such information.

[[Page 406]]



PART 543--CONTRACT MODIFICATION--Table of Contents




                         Subpart 543.1--General

Sec.
543.102  Policy.
543.170  Changes in designated subcontractors, inspection and/or 
          production points.

                      Subpart 543.2--Change Orders

543.202  Authority to issue change orders.
543.205  Contract clauses.

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

    Source:  54 FR 26554, June 23, 1989, unless otherwise noted.



                         Subpart 543.1--General



543.102  Policy.

    A modification for work outside the scope of a contract must be 
treated as a new procurement. Such modifications must be justified and 
approved under FAR Subpart 6.3, synopsized under FAR Subpart 5.2 and 
Subpart 505.2, and effected through a supplemental agreement.



543.170  Changes in designated subcontractors, inspection and/or production points.

    (a) The contracting officer shall not execute a contract 
modification that authorizes a change in a designated subcontractor or 
any designated inspection or production point, without considering the 
impact of the change on the contractor's ability to fulfill the terms 
and conditions of the contract. When considering the impact, the 
contracting officer should consider the same factors that would be 
considered in evaluating whether a contractor is responsible. (See FAR 
Subpart 9.1 and Subpart 509.1.)
    (b) If the contracting officer approves a change of subcontractor, 
inspection point, or production point, the contracting officer shall 
issue a contract modification specifying the nature of the change and 
the effective date. Where feasible, the modification should provide that 
delivery orders placed before the effective date will remain in effect 
as written. In determining the effective date, contracting officers 
should take into consideration the time necessary for offices concerned 
to take required actions.



                      Subpart 543.2--Change Orders



543.202  Authority to issue change orders.

    (a) A contracting officer's representative (COR) for a construction 
contract that has been issued a warrant under 501.603-70, may be 
authorized to issue change orders. (See 542.302.) Such change order 
authority may be exercised on a contract-by-contract basis by the 
contracting officer's written authorization. The contracting officer may 
further limit the authorization, e.g., to lower dollar amounts, to 
emergency situations, etc. In addition, the contracting officer's 
written authorization must instruct the COR to avoid personally 
performing all of the following tasks for a single change order: (1) 
Determining the need for change, (2) Preparing the Government's cost 
estimate, (3) Conducting negotiations, (4) Issuing the change order and 
(5) Inspecting the work. The contracting officer shall further instruct 
the COR to submit change orders to a designated official for review 
before issuance (for price-to-be-determined-later change orders before 
definitization) whenever all of these activities are personally 
performed. The contracting officer may personally review change orders 
or may designate the COR's immediate supervisor or a higher-level 
official within the organization to review change orders. To the maximum 
extent possible, the same individual should review change orders issued 
under a particular contract.
    (b) Change orders should be issued after coordination as 
appropriate, with counsel, quality control, finance, audit or other 
technical personnel.
[58 FR 52445, Oct. 8, 1993]



543.205  Contract clauses.

    (a) The contracting officer shall insert the clause at 552.243-70, 
Pricing of Adjustments, in solicitations and contracts when the contract 
amount is expected to exceed the simplified acquisition threshold and a 
contract other than a cost type contract is contemplated.

[[Page 407]]

    (b) The contracting officer shall insert the clause at 552.243-71, 
Equitable Adjustments, in solicitations and contracts for (1) 
dismantling, demolishing, or removing improvements; or (2) construction, 
when the contract amount is expected to exceed the simplified 
acquisition threshold and a fixed-price contract is contemplated.
    (c) The contracting officer shall insert the clause at 48 CFR 
552.243-72, Modifications (Multiple Award Schedule), in solicitations 
and multiple award schedule contracts.
[54 FR 26554, June 23, 1989, as amended at 60 FR 42804, Aug. 17, 1995; 
61 FR 6169, Feb. 16, 1996; 62 FR 44524, Aug. 21, 1997]



PART 544--SUBCONTRACTING POLICIES AND PROCEDURES--[RESERVED]






PART 545--GOVERNMENT PROPERTY--Table of Contents






       Subpart 545.3--Providing Government Property to Contractors



545.302-1  Policy.

    The head of the contracting activity (HCA) may issue determinations 
and findings under FAR 45.302-1(a)(4).

(40 U.S.C. 486(c))
[55 FR 8954, Mar. 9, 1990]



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

546.400  Scope of subpart.
546.402  Government contract quality assurance at source.
546.403  Government contract quality assurance at destination.
546.470  Testing.
546.470-1  Acceptance testing.
546.470-2  Certification testing.

                        Subpart 546.7--Warranties

546.704  Authority for use of warranties.
546.705  Limitations.
546.708  Warranties of data.
546.709  Warranties of commercial items.
546.710  Contract clauses.

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

    Source:  54 FR 26555, June 23, 1989, unless otherwise noted.



                     Subpart 546.3--Contract Clauses



546.302  Fixed-price supply contracts.



546.302-70  Source inspection by Quality Approved Manufacturer.

    Contracting officers in the Federal Supply Service shall insert the 
clause at 552.246-70, Source Inspection by Quality Approved 
Manufacturer, in solicitations and contracts that provide for source 
inspection, except multiple award schedules contracts, motor vehicle 
contracts, and contracts awarded by the Special Programs Division of the 
Office of Scientific Equipment Commodity Center, unless the contracting 
officer, in conjunction with the Central Office Quality Assurance 
Division (FQA), decides inspection by Government personnel is necessary. 
Contracting officers may authorize the use of manufacturing plants or 
other facilities located outside the United States (including Puerto 
Rico and the Virgin Islands) to perform inspection and testing under 
paragraph (a)(1) of the clause when:
    (a) Inspection services are available from another Federal agency on 
the basis of its primary inspection responsibility in a geographic area;
    (b) An inspection interchange agreement exists with another agency 
concerning inspection at a contractor's plant;
    (c) Procurement is being made for AID and specifies the area of 
source; or
    (d) Other considerations will ensure more economical and effective 
inspection consistent with the Government's interest.

Such authorization must be fully coordinated with FQA and documented in 
the file.

[[Page 408]]



546.302-71  Source inspection.

    The contracting officer shall insert the clause at 552.246-72, 
Source Inspection, in solicitations and contracts when it is determined 
that inspection is to be performed at the source by Government 
personnel.



546.312  Construction contracts.

    The contracting officer shall insert the clause at 552.246-71, Final 
Inspection and Tests, in solicitations and contracts for construction 
that include the Inspection of Construction clause at FAR 52.246-12.



           Subpart 546.4-Government Contract Quality Assurance



546.400  Scope of subpart.

    This subpart prescribes policies and procedures for use by the 
Federal Supply Service. Use by other GSA activities is optional.



          Subpart 546.4--Government Contract Quality Assurance



546.402  Government contract quality assurance at source.

    (a) Source inspection of supplies shall be performed either by 
Government personnel or by a Quality Approved Manufacturer when the 
contract is:
    (1) A Federal Supply Schedule contract selected for source 
inspection;
    (2) A requirements contract which is national in scope (including 
shipments to GSA distribution centers);
    (3) A requirements contract which is regional in scope;
    (4) A definite quantity contract for stock items;
    (5) For Class 8010 items; or
    (6) For Special-purpose vehicles, trucks over 10,000 pounds gross 
vehicle weight (GVW), trucks weighing 10,000 pounds GVW or less that are 
not covered by a Federal standard, and vehicles to be shipped outside 
the coterminous United States.
    (b) Contracts may also provide for source inspection when the 
contracting director, after coordination with FQA, determines that it is 
in the Government's interest due to the critical nature of the supplies.



546.403  Government contract quality assurance at destination.

    Inspection of supplies at destination should be performed when the 
supplies are purchased using simplified acquisition procedures, a 
schedule contract is involved (except for schedules selected for source 
inspection), or the contract is for:
    (a) Commercial or off-the-shelf products;
    (b) Standard vehicles purchased for domestic consignees; or
    (c) Trucks weighing 10,000 pounds GVW or less purchased for domestic 
consignees using a Federal Standard.
[54 FR 26555, June 23, 1989, as amended at 60 FR 42804, Aug. 17, 1995]



546.470  Testing.

    Testing to determine conformance with specifications and standards 
may be conducted at facilities of Federal agencies, manufacturers, 
independent testing laboratories, and others, as appropriate.



546.470-1  Acceptance testing.

    (a) Acceptance testing is conducted to determine conformance with 
purchase descriptions or specifications before a shipment is accepted. 
Such testing must not be solely for the purpose of furnishing 
information to a producer or vendor as to conformance with specification 
requirements.
    (b) The cost of services for acceptance testing of samples of a 
shipment normally will be borne by GSA, except for retesting 
necessitated by prior rejection.



546.470-2  Certification testing.

    (a) Certification testing is conducted to determine conformance of 
an item with a specification for the purpose of executing a certificate 
of compliance required by the specification.
    (b) When a certificate from a recognized laboratory is required by 
the contract and there is a lack of suitable commercial testing 
facilities, GSA, upon request and agreement by the contractor to pay all 
costs, will arrange, for the required certification testing by a 
Government laboratory, where feasible.

[[Page 409]]



                        Subpart 546.7--Warranties



546.704  Authority for use of warranties.

    The contracting officer must consider the criteria in FAR 46.703 and 
decide whether to use a warranty in a specific acquisition.



546.705  Limitations.

    The use of warranties in cost reimbursement contracts, other than 
those in FAR clause 52.246-3 or 52.246-8, must be approved by the 
contracting director.



546.708  Warranties of data.

    Warranties of data should be developed by the technical or 
specification manager when the contracting officer decides that the use 
of a warranty is in the Government's interest and the contracting 
director concurs.



546.709  Warranties of commercial items.

    The specification manager shall advise the contracting officer: (a) 
Whether the specification contains a warranty or a commercial warranty 
applies and (b) when an extended warranty is necessary and recommends 
the duration of the extended warranty.



546.710  Contract Clauses.

    (a)(1) The contracting officer shall insert the clause at 552.246-
17, Warranty of Supplies of a Noncomplex Nature, or applicable alternate 
in solicitations and contracts instead of the FAR clause at 52.246-17 or 
applicable alternate.
    (2) If commercial products or items are being acquired under a 
program other than Multiple Award Schedules, the contracting officer 
shall use the clause at 48 CFR 552.247.17 with its Alternate I.
    (3) If the acquisition is for other than commercial items in Class 
8010, the contracting officer shall use the clause at 552.246-17 with 
its Alternate II.
    (4) If the acquisition is for other than commercial items in Class 
8030 or 8040, the contracting officer shall use the clause at 552.246-17 
with its Alternate III. In addition, the contracting officer shall 
specify in the solicitation whether items being acquired are 
``noncritical end use items'' or ``critical end use items''.
    (b) The contracting officer shall insert the clause at 552.246-73, 
Warranty--Multiple Award Schedule, in solicitations and multiple award 
schedule (except international schedule) contracts.
    (c) The contracting officer shall insert the clause at 552.246-74, 
Warranty--International Multiple Award Schedule, in solicitations and 
international multiple award schedule contracts.
    (d) The contracting officer shall insert the clause at 552.246-76, 
Warranty of Pesticides, in solicitations and contracts involving the 
procurement of pesticides.
    (e) The contracting officer shall insert the clause at 552.246-75, 
Guarantees, in solicitations and contracts for construction when the 
contract amount is expected to exceed the simplified acquisition 
threshold.
[54 FR 26555, June 23, 1989, as amended at 56 FR 1741, Jan. 17, 1991; 60 
FR 42804, Aug. 17, 1995; 61 FR 6169, Feb. 16, 1996]



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.
547.304-5  Exceptions.
547.305  Solicitation provisions, contract clauses, and transportation 
          factors.
547.370  Restrictions on transportation to military installations.

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

    Source:  54 FR 26556, June 23, 1989, unless otherwise noted.



            Subpart 547.3--Transportation in Supply Contracts



547.300  Scope of subpart.

    This subpart prescribes policies and procedures for Federal Supply 
Service (FSS) acquisitions.

[[Page 410]]



547.303  Standard delivery terms and contract clauses.



547.303-1  F.o.b origin.

    (a) The contractor shall request a carrier routing from the 
applicable transportation zone office on all shipments weighing 10,000 
pounds or more.
    (b) The contractor shall ship on a Government bill of lading (GBL) 
unless:
    (1) Shipment is via postal or parcel service;
    (2) Shipment on a commercial bill of lading (CBL) is authorized in 
writing by the contracting officer because (i) shipment is urgently 
required and (ii) a GBL cannot be issued in a timely manner; or
    (3) The transportation cost estimate is under $100 (see FAR 
42.1403).
    (c) The signature of the carrier's agent and the annotation at FAR 
52.247-1 must be shown on the original and all copies of the CBL. The 
original of the CBL must be mailed to the office, which authorized the 
CBL.
[54 FR 26556, June 23, 1989, as amended at 61 FR 39089, July 26, 1996]



547.304-5  Exceptions.

    (a) Unless the contracting officer can justify more restrictive 
delivery terms and documents the contract file accordingly, 
solicitations including delivery to Alaska, Hawaii, or Puerto Rico must 
specify that offers:
    (1) May be f.o.b origin; f.o.b. vessel, part of shipment; f.o.b. 
destination; or any combination of these delivery terms (other delivery 
terms may be provided for, if appropriate); and
    (2) Will be evaluated on the basis of the lowest overall cost to the 
Government delivered to the ultimate destination.
    (b) Federal Supply Schedules should attempt to obtain a f.o.b. 
destination delivery term for Alaska, Hawaii, and Puerto Rico, if such 
delivery term is offered for shipments within CONUS.



547.305  Solicitation provisions, contract clauses, and transportation factors.

    The contracting officer shall insert in solicitations and contracts 
the clause at 552.247-70, Placarding Railcar Shipments, when it is 
essential that the railcar doors be specially positioned next to the 
unloading dock, platform, or warehouse door.



547.370  Restrictions on transportation to military installations.

    Solicitations and contracts specifying direct delivery to military 
installations must specify applicable delivery restrictions.



PART 548--VALUE ENGINEERING--[RESERVED]






PART 549--TERMINATION OF CONTRACTS--Table of Contents




                    Subpart 549.1--General Principles

Sec.
549.111  Review of proposed settlements.

                 Subpart 549.4--Termination for Default

549.402-6  Repurchase against contractor's account.
549.402-7  Other damages.

               Subpart 549.5--Contract Termination Clauses

549.502  Termination for convenience of the Government.
549.570  Submission of termination liability schedule.

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

    Source:  54 FR 26557, June 23, 1989, unless otherwise noted.



                    Subpart 549.1--General Principles



549.111  Review of proposed settlements.

    The HCA may establish procedures for the review and approval of 
settlement agreements at a level above the contracting officer.
[60 FR 54956, Oct. 27, 1995]



                 Subpart 549.4--Termination for Default



549.402-6  Repurchase against contractor's account.

    (a) After termination but before repurchase, the contracting officer 
shall revalidate the need for the supplies or services and document the 
file.

[[Page 411]]

    (b) Repurchase against a contractor's account must be based on the 
original contract terms, conditions, and specification. If acceptable 
offers cannot be obtained on this basis, similar supplies or services 
may be bought to substantially satisfy the original requirement. Advice 
of counsel must be obtained before issuing a solicitation for similar 
supplies or services.
    (c) To protect the Government's rights to recover reprocurement 
costs, the contracting officer must document the file to explain the 
circumstances of any delay in the reprocurement.
[54 FR 26557, June 23, 1989, as amended at 56 FR 33722, July 23, 1991]



549.402-7  Other damages.

    (a) Under the default clause, in addition to assessing reprocurement 
costs, the contracting officer may assess other damages, including 
administrative costs (e.g., salaries and fringe benefits paid to 
Government employees who perform work as a result of the default, 
preaward survey expense incurred in qualifying reprocurement 
contractors, and costs incurred in printing and distributing the 
reprocurement solicitation), if in the best interest of the Government.
    (b) Documents supporting an assessment of administrative costs must 
be detailed and must demonstrate that the added costs incurred by the 
Government were a direct result of the default.
    (1) To support administrative labor costs, the contracting officer 
must record:
    (i) Name, position, and organization of each employee performing 
work activities as a consequence of the default.
    (ii) Date(s) of work and time(s) spent by each employee on the 
repurchase.
    (iii) Description of specific tasks performed (i.e., solicitation, 
preparation, clerical).
    (iv) Hourly rate of pay (straight time or overtime).
    (v) Applicable fringe benefits.
    (vi) Explanation of how the time spent by the employees during the 
reprocurement would have been used on other projects but for the 
default.
    (2) To support other incurred administrative costs (i.e., travel, 
per diem, printing and distribution of the repurchase contract), 
documents may include travel vouchers, invoices, printing requisitions, 
and other appropriate evidence of expenditures.
    (c) After deciding that the assessment of administrative costs is 
appropriate, the contracting officer shall make a written demand on the 
contractor. The basis of calculating the costs being assessed must be 
furnished to the contractor. A single demand letter may be used to 
recover excess costs and administrative costs.
[54 FR 26557, June 23, 1989, as amended at 56 FR 33722, July 23, 1991]



               Subpart 549.5--Contract Termination Clauses



549.502  Termination for convenience of the Government.

    The contracting officer shall insert the clause at 552.249-70, 
Termination for Convenience of the Government (Fixed-Price), in all 
solicitations and contracts for the acquisition and maintenance of 
telephone systems to be funded through the Information Technology Fund 
(IT). This clause should be used with the FAR clauses at 52.249-1 or 
52.249-2 and 52.249-4.



549.570  Submission of termination liability schedule.

    The contracting officer shall insert the clause at 552.249-71, 
Submission of Termination Liability Schedule, in all solicitations for 
the acquisition and maintenance of telephone systems to be funded 
through the Information Technology Fund (IT). This provision is to be 
used when the clause at 552.249-70 is used.



PART 550--EXTRAORDINARY CONTRACTUAL ACTIONS--Table of Contents






550.001  Definitions.

    Approving authority, as used in FAR Part 50, means the Administrator 
of General Services Administration.

(40 U.S.C. 486(c))
[54 FR 26557, June 23, 1989]



PART 551--USE OF GOVERNMENT SOURCES BY CONTRACTORS--[RESERVED]




[[Page 412]]



                     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  Using Part 552.
552.102  Incorporating provisions and clauses.
552.102-1  Incorporation by reference.
552.103  Identification of provisions and clauses.
552.105  Procedures for using alternate.
552.107  Provisions and clauses prescribed in Subpart 552.1.

              Subpart 552.2--Text of Provisions and Clauses

552.200  Scope of subpart.
552.203-4  Contingent fee representation and agreement.
552.203-5  Convenant against contingent fees.
552.203-70  Restriction on advertising.
552.203-71  Prohibited conduct.
552.203-72  Requirement for Certificate of Procurement Integrity.
552.203-73  Price adjustment for illegal or improper activity.
552.209-73  Product removal from qualified products list.
552.209-74  Waiver of first article testing and approval requirement.
552.209-75  Supplemental requirements for first article approval--
          contractor testing.
552.209-76  Supplemental requirements for first article approval--
          government testing.
552.211-1  Time of delivery.
552.211-70  Brand name or equal.
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--Commercial Items (Multiple Award Schedule).
552.214-16  Minimum bid acceptance period.
552.214-73  ``All or none'' offers.
552.214-74  Solicitation copies.
552.214-75  Progressive awards and monthly quantity allocations.
552.214-76  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.
552.216-71  Economic price adjustment--FSS multiple award schedule 
          contracts.
552.216-72  Economic price adjustment--Stock and Special Order Program 
          Contracts.
552.216-73  Placement of orders.
552.216-74  Ordering information.
552.217-70  Evaluation of Options.
552.217-71  Notice Regarding Option(s).
552.219-71  Allocation of orders--partially set-aside items.
552.219-72  Notice to offerors of subcontracting plan requirements.
552.219-73  Preparation, submission, and negotiation of subcontracting 
          plans.
552.219-74  Goals for Subcontracting Plan.
552.223-70  Hazardous substances.
552.223-71  Hazardous material information.
552.223-72  Nonconforming hazardous materials.
552.225-8  Trade Agreements Act Certificate.
552.225-9  Trade Agreements Act.
552.225-70  Buy American Act--hand or measuring tools or stainless steel 
          flatware.
552.225-71  Notice of procurement restriction--hand or measuring tools 
          or stainless steel flatware.
552.225-72  Eligible products from nondesignated countries--waiver.
552.225-75  Buy American Act Notice--construction materials.
552.227-70  Government rights (unlimited).
552.227-71  Drawings and other data to become property of Government.
552.228-70  Bid guarantee and bonds.
552.228-71  Bid guarantee.
552.228-72  Performance bond.
552.228-73  Performance and payment bonds.

[[Page 413]]

552.228-75  Workmen's compensation laws.
552.229-70  Federal, state, and local taxes.
552.229-72  Federal excise tax--DC government.
552.232-8  Discounts for prompt payment.
552.232-23  Assignment of claims.
552.232-70  Payments by electronic funds transfer.
552.232-71  Prompt payment.
552.232-72  Invoice requirements.
552.232-73  Electronic funds transfer payment.
552.232-77  Availability of funds.
552.232-78  Adjusting payments.
552.232-79  Final payment.
552.232-80  Payment by credit card.
552.233-70  Disputes (utility contract).
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  Furnishing information and records.
552.237-70  Qualifications of offerors.
552.237-71  Qualifications of employees.
552.237-72  Certification regarding ``quasi-military armed force.''
552.238-70  Identification of electronic office equipment providing 
          accessibility for the handicapped.
552.238-72  Contractor's report of sales.
552.238-74  Submission and distribution of authorized FSS schedule 
          pricelists.
552.238-75  Identification of Energy-Efficient Office Equipment and 
          Supplies Containing Recovered Materials or Other Environmental 
          Attributes.
552.238-76  Price reductions.
552.238-77  Industrial funding fee.
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  Final inspection and tests.
552.246-72  Source inspection by Government.
552.246-73  Warranty--multiple award schedule.
552.246-74  Warranty--international multiple award schedule.
552.246-75  Guarantees.
552.246-76  Warranty of pesticides.
552.247-70  Placarding railcar shipments.
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 or variations in provisions.
552.252-6  Authorized deviations or variations in clauses.
552.270-1  Preparation of offers.
552.270-2  Explanation to prospective offerors.
552.270-3  Late submissions, modifications, and withdrawals of offers.
552.270-4  Historic preference.
552.270-5  Lease award.
552.270-6  Parties to execute lease.
552.270-10  Definitions.
552.270-11  Subletting and assignment.
552.270-12  Maintenance of building and premises--right of entry.
552.270-13  Fire and casualty damage.
552.270-14  [Reserved]
552.270-15  Compliance with applicable law.
552.270-16  Inspection--right of entry.
552.270-17  Failure in performance.
552.270-18  Successors bound.
552.270-19  Alterations.
552.270-20  Proposals for adjustment.
552.270-21  Changes.
552.270-22  Liquidated damages.
552.270-23--552.270-24  [Reserved]
552.270-25  Adjustments for vacant premises.
552.270-26  [Reserved]
552.270-27  Delivery and condition.
552.270-28  Default in delivery--time extensions.
552.270-29  [Reserved]
552.270-30  Progressive occupancy.
552.270-31  Payment.
552.270-32  Effect of acceptance and occupancy.
552.270-33  Default by lessor during the term.
552.270-34  Subordination, nondisturbance and attornment.
552.270-35  Statement of lease.
552.270-36  Substitution of tenant agency.
552.270-37  No waiver.
552.270-38  Integrated agreement.
552.270-39  Mutuality of obligation.
552.270-40  Asbestos and hazardous waste management.
552.270-41  Acceptance of space.

              Subpart 552.3--Provision and Clause Matrixes

552.300  Scope of subpart.

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

    Source:  54 FR 26558, June 23, 1989, unless otherwise noted.

[[Page 414]]



552.000  Scope of part.

    This part provides the text of provisions and clauses which are 
unique to GSA or supplement the FAR. Matrixes are also provided for 
acquisitions of various supplies, services and leasehold interests in 
real property.



      Subpart 552.1--Instructions for Using Provisions and Clauses



552.101  Using Part 552.

    (a) Definition. ``Clause,'' as used in this subpart, means provision 
or clause as defined in FAR 52.101(a).
    (b) Numbering. When a clause in this part has the same title as a 
clause in the FAR, that clause is preceded by the number 5 and is 
included under the same subsection number and caption as in the FAR. 
Clauses numbered in this manner represent (1) clauses which are 
``substantially'' the same as FAR clauses, and (2) clauses which are to 
be used instead of FAR clauses. All supplemental clauses are numbered in 
the same manner as the FAR, except that the number is preceded by the 
chapter number and the subsection numbers begin with 70 and are 
sequentially numbered, e.g., 552.232-70, 552.232-71, etc.
    (c) Matrixes. Matrixes are included as a guide to locating clauses 
for supply, service, construction, and architect-engineer solicitations/
contracts. There is a separate matrix for small purchases. Matrixes 
listing FAR and GSAR clauses for utility contracts (sole-supplier-
regulated rates) and leases of real property are also included. 
Individuals drafting solicitations must research pertinent regulations 
or make other determinations to ensure that (1) the clauses selected fit 
the procurement, (2) there are no restrictions on their use, and (3) 
when one clause is dependent upon the use of another clause, all 
necessary clauses are included in the solicitation.



552.102  Incorporating provisions and clauses.



552.102-1  Incorporation by reference.

    Clauses prescribed in the GSAR may be incorporated in solicitations/
contracts by reference. As an alternative, forms containing GSAR clauses 
in full text may be incorporated by reference.



552.103  Identification of provisions and clauses.

    (a) When a class deviation from a FAR clause is prescribed in the 
GSAR, the contracting officer shall identify the clause by the GSAR 
citation (552.232-8--Prompt Payment Discount (Nov 1987) (Deviation FAR 
52.232-8)).
    (b) When a ``substantially the same as'' clause is used that varies 
from a FAR or GSAR clause, the word ``(Variation),'' must be included as 
a part of the title of the clause, along with the FAR or GSAR citation 
(552.215-70 Examination of Records by GSA (Apr 1984) (Variation I)). If 
there is more than one variation of a provision or clause, the 
variations are titled (Variation I), (Variation II), (Variation III), 
etc. Variations of clauses which result from negotiations do not need to 
be identified unless an amendment to the solicitation is issued.
    (c) Variations of FAR or GSAR clauses should generally be used for 
individual cases. A copy of clause variations developed for repeated use 
must be furnished to the Office of GSA Acquisition Policy (VP) 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  Provisions and clauses prescribed in Subpart 552.1.

    (a) The contracting officer shall insert the provision at 552.252-5, 
Authorized Deviations or Variations in Provisions, in solicitations that 
include any FAR or GSAR clause with an authorized deviation or 
variation. This provision must be used in lieu of the FAR provision at 
52.252-5.
    (b) The contracting officer shall insert the clause at 552.252-6, 
Authorized Deviations or Variations in Clauses, in solicitations and 
contracts that include any FAR or GSAR clause with an authorized 
deviation or variation. This clause must be used in lieu of the FAR 
clause at 52.252-6.

[[Page 415]]



              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, 
and for each provision and clause, provides a cross-reference to the 
location in the GSAR that prescribes its use.



552.203-4  Contingent Fee Representation and Agreement.

    As prescribed in 503.404(a), insert the following provision:

         Contingent Fee Representation and Agreement (May 1989)

    (a) Representation. The Offeror represents that, except for full-
time bona fide employees working solely for the offeror or bona fide 
established real estate agents or brokers maintained by the Offeror for 
the purpose of securing business, the Offeror--

    Note:  The Offeror must check the appropriate boxes. For 
interpretation of the term ``bona fide employee or agency,'' see 
paragraph (b) of the Covenant Against Contingent Fees clause.

    (1) ________ has, ________ has not employed or retained any person 
or company to solicit or obtain this contract; and
    (2) ________ has, ________ has not paid or agreed to pay to any 
person or company employed or retained to solicit or obtain this 
contract any commission, percentage, brokerage, or other fee contingent 
upon or resulting from the award of this contract.
    (b) Agreement. The Offeror agrees to provide information relating to 
the above Representation as requested by the Contracting Officer and, 
when subparagraph (a)(1) or (a)(2) is answered affirmatively, to 
promptly submit to the Contracting Officer--
    (1) A completed Standard Form 119, Statement of Contingent or Other 
Fees, (SF 119); or
    (2) A signed statement indicating that the SF 119 was previously 
submitted to the same contracting office, including the date and 
applicable solicitation or contract number, and representing that the 
prior SF 119 applies to this offer or quotation.

                           (End of provision)



552.203-5  Covenant Against Contingent Fees.

    As prescribed in 503.404(b), insert the following clause:

               Covenant Against Contingent Fees (May 1989)

    (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 warranty, the 
Government shall have the right to annul this contract without liability 
or, in its discretion, to deduct from the contract price or 
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)

[54 FR 26558, June 23, 1989, as amended at 55 FR 6256, Feb. 22, 1990]



Sec. 552.203-70  Restriction on advertising.

    As prescribed in 503.570-2, insert the following clause:

                  Restriction on Advertising (Dec 1990)

    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

[[Page 416]]

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)

[56 FR 965, Jan. 10, 1991]



552.203-71  Prohibited conduct.

    As prescribed in 503.104-10(a), insert the following provision:

                      Prohibited Conduct (Sep 1990)

    (a) Prohibited conduct. The Office of Federal Procurement Policy 
Act, as amended (41 U.S.C. 423), provides that during the conduct of any 
Federal agency procurement of property or services, no competing 
contractor or officer, employee, representative, agent, or consultant of 
any competing contractor shall knowingly--
    (1) Make, directly or indirectly, any offer or promise of future 
employment or business opportunity to, or engage, directly or 
indirectly, in any discussion of future employment or business 
opportunity with, any procurement official of the agency, except as 
provided in FAR 3.104-6(b);
    (2) Offer, give, or promise to offer or give, directly or 
indirectly, any money, gratuity, or other thing of value to any 
procurement official of the agency; or
    (3) Solicit or obtain, directly or indirectly, from any officer or 
employee of the agency, prior to the award of a contract any proprietary 
or source selection information regarding the procurement.
    (b) Penalties. Civil penalties for violation of these prohibitions 
are up to $100,000 for an individual or $1,000,000 for an offeror or 
prospective offeror other than an individual. Criminal penalties are up 
to 5 years imprisonment and/or a fine in accordance with Title 18, 
United States Code.

                           (End of Provision)

[55 FR 39974, Oct. 1, 1990]



552.203-72  Requirement for Certificate of Procurement Integrity.

    As prescribed in 503.104-10(b), insert the following provision:

     Requirement for Certificate of Procurement Integrity (Aug 1995)

    (a) Definitions. The definitions at FAR 3.104-4 are hereby 
incorporated in this provision, except that ``property'' also means 
acquisitions of leasehold interests in real property.
    (b) The officer or employee responsible for the offer submitted in 
response to this solicitation shall submit the following certification 
upon the request of the Contracting Officer.

                  Certificate of Procurement Integrity

    (1) I, [Name of certifier], am the officer or employee responsible 
for the preparation of this offer and hereby certify that to the best of 
my knowledge and belief, with the exception of any information described 
in this certificate, I have no information concerning a violation or 
possible violation of subsection 27 (a), (b), (d) or (f) of the Office 
of Federal Procurement Policy Act, as amended* (41 U.S.C. 423) 
(hereinafter referred to as ``the Act''), as implemented in the FAR, 
occurring during the conduct of this procurement (solicitation number).
---------------------------------------------------------------------------


    * Subsection 27 (a), (b), and (d) are effective on December 1, 1990. 
Subsection 27(f) is effective on June 1, 1991.
---------------------------------------------------------------------------

    (2) As required by subsection 27(e)(1)(B) of the Act, I further 
certify that, to the best of my knowledge and belief, each officer, 
employee, agent, representative, and consultant of [Name of offeror] who 
has participated personally and substantially in the preparation or 
submission of this offer has certified that he or she is familiar with, 
and will comply with, the requirements of subsection 27(a) of the Act, 
as implemented in the FAR, and will report immediately to me any 
information concerning a violation or possible violation of subsections 
27 (a), (b), and (d), or (f) of the Act, as implemented in the FAR, 
pertaining to this procurement.
    (3) Violations or possible violations: (Continue on plain bond paper 
if necessary and label Certificate of Procurement Integrity 
(Continuation Sheet)),
 ENTER ``NONE'' IF NONE EXISTS__________________________________________
 _______________________________________________________________________
________________________________________________________________________
________________________________________________________________________
    (4) I agree that, if awarded a contract under this solicitation, the 
certifications required by subsection 27(e)(1)(B) of the Act shall be 
maintained in accordance with paragraph (f) of this provision.
 _______________________________________________________________________
[Signature of officer or employee responsible for offer]  Date

 _______________________________________________________________________
[Typed name of officer or employee responsible for offer]

    This certification concerns a matter within the jurisdiction of an 
agency of the United States and the making of a false, fictitious, or 
fraudulent certification may render the maker subject to prosecution 
under title 18, United States Code, section 1001.
    (c) Pursuant to FAR 3.104-9(d), the offeror may be requested to 
execute additional certifications at the request of the Government.

[[Page 417]]

Failure of an offeror to submit the additional certification may cause 
its offer to be rejected.
    (d) A certification containing a disclosure of a violation or 
possible violation will not necessarily result in the withholding of 
award under this solicitation. However, the Government, after the 
evaluation of the disclosure, may cancel this procurement or take any 
other appropriate actions in the interest of the Government, such as 
disqualification of the offeror.
    (e) In making the certification in paragraph (2) of the certificate, 
the officer or employee of the competing contractor responsible for the 
offer may rely upon a onetime certification from each individual 
required to submit a certification to the competing Contractor, 
supplemented by periodic training. These certifications shall be 
obtained at the earliest possible date after an individual required to 
certify begins employment or association with the contractor. If the 
contractor decides to rely on a certification executed prior to the 
suspension of section 27 (i.e., before December 1, 1989), the contractor 
shall ensure that an individual who has so certified is notified that 
section 27 has been reinstated. These certifications shall be maintained 
by the Contractor for 6 years from the date of a certifying employee's 
employment with the company ends or, for an agent, representative, or 
consultant, 6 years from the date such individual ceases to act on 
behalf of the Contractor.
    (f) Certifications under paragraphs (b) and (c) of this provision 
are material representations of fact upon which reliance will be placed 
in awarding a contract.

                           (End of Provision)

[55 FR 39975, Oct. 1, 1990, as amended at 55 FR 50701, Dec. 12, 1990; 60 
FR 42795, Aug. 17, 1995]



552.203-73  Price adjustment for illegal or improper activity.

    As prescribed in 503.104-10(c), insert the following clause:

      Price Adjustment for Illegal or Improper Activity (Sep 1990)

    (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, 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)

[55 FR 39975, Oct. 1, 1990]



552.209-73  Product removal from qualified products list.

    As prescribed in 509.206-2, insert the following clause:

         Product Removal From Qualified Products List (FEB 1996)

    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)

[54 FR 26558, June 23, 1989, as amended at 61 FR 6169, Feb. 16, 1996]



552.209-74  Waiver of first article testing and approval requirements.

    As prescribed in 509.306, insert the following provision:

   Waiver of First Article Testing and Approval Requirement (Feb 1990)

    (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.

[[Page 418]]

    (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)

[55 FR 8954, Mar. 9, 1990]



552.209-75  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 
                               (May 1989)

    (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 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.
    (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)



552.209-76  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 
                               (May 1989)

    (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 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)



552.211-1  Time of delivery.

    As prescribed in 48 CFR 511.404(a)(1) insert the following clause:

                       Time of Delivery (FEB 1996)

    (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 (FEB 1996)

    If it is necessary to show different delivery times for different 
items or groups of items, the Contracting Officer may substitute the 
following paragraph (b) for paragraph (b) of the basic 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:

[[Page 419]]



                                                                        
------------------------------------------------------------------------
 Items or groups of items (special                                      
    item numbers or nomenclature      Required delivery time (days ARO) 
------------------------------------------------------------------------
                                     ...................................
------------------------------------------------------------------------
                                     ...................................
------------------------------------------------------------------------
                                     ...................................
------------------------------------------------------------------------
------------------------------------------------------------------------

[54 FR 26558, June 23, 1989, as amended at 54 FR 51886, Dec. 19, 1989. 
Redesignated and amended at 61 FR 6170, Feb. 16, 1996]



552.211-70  Brand name or equal.

    As prescribed in 48 CFR 511.170(c) insert the following clause:

                     Brand Name or Equal (FEB 1996)

    (As used in this clause, the term ``brand name'' includes 
identification of products by make and model.)
    (a) Identification of items in this solicitation by a ``brand name 
or equal'' description is intended to indicate the quality and 
characteristics of products that will be satisfactory and is not 
intended to be restrictive. 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 offers and are determined by the Government to meet 
fully the salient characteristics requirements listed in the 
solicitation.
    (b) Unless clearly indicated in the offer that an ``equal'' product 
is offered, the offer shall be considered as offering a referenced brand 
name product.
    (c)(1) An offeror proposing to furnish an ``equal'' product shall 
insert the name of the product in the space provided in the solicitation 
or otherwise clearly identify the product. The Government's 
determination as to the acceptability of the ``equal'' product shall be 
based on information furnished or otherwise identified in the offer as 
well as other information reasonably available to the purchasing 
activity. Caution to Offerors. The purchasing activity is not 
responsible for locating or securing any information not identified in 
the offer and reasonably available to the purchasing activity. 
Accordingly, to ensure that sufficient information is available, the 
offeror must furnish with its offer all descriptive material (such as 
cuts, illustrations, drawings, or other information) necessary for the 
purchasing activity to (i) determine whether the product offered meets 
the specified salient characteristics, and (ii) establish exactly what 
the offeror proposes to furnish. The information furnished may include 
specific references to information previously furnished or otherwise 
reasonably available to the purchasing activity.
    (2) An offeror proposing to modify a product to make it conform to 
the requirements of the solicitation shall (i) include in its offer a 
clear description of the proposed modifications and (ii) clearly mark 
any descriptive material to show the proposed modifications.
    (3) In sealed bidding, modifications proposed after bid opening to 
make a product conform to a brand name product referenced in the 
solicitation will not be considered.

                             (End of Clause)

[54 FR 26558, June 23, 1989. Redesignated and amended at 61 FR 6169, 
Feb. 16, 1996]



552.211-71  Standard references.

    As prescribed in 48 CFR 511.204(a), insert the following clause:

                     Standard References (FEB 1996)

    (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 (a)(1) of this clause, 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) Federal Specifications, Federal Standards, Standard 
Specifications of the Public Buildings Service and Public Buildings 
Service Standard Methods of Test may be obtained from the Business 
Service Center at any GSA Regional Office. Inquiries regarding 
``Commercial Standards,'' ``Product Standards,'' and ``Simplified 
Practice Recommendations'' should be addressed to the Standard 
Development Service Section, National Bureau of Standards, Washington, 
DC 20234. Publications of Associations referred

[[Page 420]]

to in the specifications may be obtained directly from the Associations.
    (c) Upon request the Contractor shall make available at the job site 
within a reasonable time, a copy of each trade manual and standard which 
is incorporated by reference in this contract and which governs quality 
and workmanship.

                             (End of Clause)

[54 FR 26558, June 23, 1989. Redesignated and amended at 61 FR 6169, 
Feb. 16, 1996]



552.211-72  Reference to specifications in drawings.

    As prescribed in 48 CFR 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)

[54 FR 26558, June 23, 1989. Redesignated and amended at 61 FR 6169, 
Feb. 16, 1996]



552.211-73  Marking.

    As prescribed in 48 CFR 511.204(c) 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)

[54 FR 26558, June 23, 1989. Redesignated and amended at 61 FR 6169, 
Feb. 16, 1996]



552.211-74  Charges for marking.

    As prescribed in 48 CFR 511.204(d), insert a clause substantially as 
follows:

                     Charges for Marking (FEB 1996)

    The rate provided for in paragraph (b) of 48 CFR 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.
[54 FR 26558, June 23, 1989. Redesignated and amended at 61 FR 6170, 
Feb. 16, 1996]



552.211-75  Preservation, packaging and packing.

    As prescribed in 48 CFR 511.204(e), 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)

[54 FR 26558, June 23, 1989. Redesignated and amended at 61 FR 6170, 
Feb. 16, 1996]



552.211-76  Charges for packaging and packing.

    As prescribed in 48 CFR 511.204(f), insert a clause substantially as 
follows:

[[Page 421]]

              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 therefor 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.
[54 FR 26558, June 23, 1989. Redesignated and amended at 61 FR 6170, 
Feb. 16, 1996]



552.211-77  Packing list.

    As prescribed in 48 CFR 511.204(g), 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)

[54 FR 26548, June 23, 1989, as amended at 54 FR 43180, Oct. 23, 1989. 
Redesignated and amended at 61 FR 6170, Feb. 16, 1996]



552.211-78  Commercial Delivery Schedule (Multiple Award Schedule).

    As prescribed in 48 CFR 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:

                                                                                                                
----------------------------------------------------------------------------------------------------------------
  Items or group of items (special      Government's stated delivery time      Contractor's normal commercial   
      item No. or nomenclature)                    (days ARO)                           delivery 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.

                                                                        
------------------------------------------------------------------------
  Item or group of items (special    Expedited delivery time (hours/days
     item No. of nomenclature)                       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

[[Page 422]]

offering such delivery services will be required to state in the cover 
sheet to its FSS price list details concerning this service.
(End of Clause)
[61 FR 6170, Feb. 16, 1996]



552.211-79  Acceptable age of supplies.

    As prescribed in 48 CFR 511.404(a), 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.
[54 FR 26558, June 23, 1989. Redesignated and amended at 61 FR 6169, 
Feb. 16, 1996]



552.211-80  Age on delivery.

    As prescribed in 48 CFR 511.404(a), 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)

[54 FR 26558, June 23, 1989. Redesignated and amended at 61 FR 6169, 
Feb. 16, 1996]



552.211-81  Time of shipment.

    As prescribed in 48 CFR 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.)
[54 FR 26558, June 23, 1989. Redesignated and amended at 61 FR 6170, 
Feb. 16, 1996]



552.211-82  Notice of shipment.

    As prescribed in 48 CFR 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)

[54 FR 26558, June 23, 1989. Redesignated and amended at 61 FR 6170, 
Feb. 16, 1996; 61 FR 14033, Mar. 29, 1996]



552.211-83  Availability for inspection, testing, and shipment/delivery.

    As prescribed in 48 CFR 511.404(a)(6), insert the following clause:

[[Page 423]]

 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 ``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.
[54 FR 26558, June 23, 1989, as amended at 54 FR 40060, Sept. 29, 1989. 
Redesignated and amended at 61 FR 6170, Feb. 16, 1996]



552.211-84  Non-compliance with contract requirements.

    As prescribed in 48 CFR 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)

[54 FR 26558, June 23, 1989. Redesignated and amended at 61 FR 6170, 
Feb. 16, 1996]



552.212-70  Preparation of Offer (Multiple Award Schedule).

    As prescribed in 48 CFR 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)

[[Page 424]]

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 initialed 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 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)

[62 FR 44524, Aug. 21, 1997]



Sec. 552.212-71  Contract terms and conditions applicable to GSA acquisition of commercial items.

    As prescribed in 48 CFR 512.301(a)(2), insert the following 
provision:

     Contract Terms and Conditions Applicable to GSA Acquisition of 
                       Commercial Items (AUG 1997)

    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 times 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 clauses that apply or 
delete the clauses that do not apply from the list. The contracting 
officer may add the date of the clause if desired for clarity.]

--552.203-70  Restriction on Advertising
--552.211-73  Marking
--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
--552.219-71  Allocation of Orders--Partially Set-Aside Items
--552.228-75  Workmen's Compensation
--552.229-70  Federal, State, and Local Taxes
--552.232-8  Discounts for Prompt Payment
--552.232-23  Assignment of Claims
--552.232-70  Payments by Electronic Funds Transfer
--552.232-77  Availability of Funds
--552.232-78  Adjusting Payments
--552.232-79  Final Payment
--552.237-70  Qualifications of Offerors
--552.237-71  Qualifications of Employees
--552.238-72  Contractor's Report of Sales
--552.238-74  Submission and Distribution of Authorized FSS Schedule 
Price List
--552.238-76  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 Provision)
[61 FR 6171, Feb. 16, 1996; 61 FR 10846, Mar. 15, 1996, as amended at 62 
FR 44524, Aug. 21, 1997]



552.212-72  Contract terms and conditions required to implement statutes or Executive Orders applicable to GSA acquisition of commercial items.

    As prescribed in 48 CFR 512.301(a)(3), insert the following 
provision:

    Contract Terms and Conditions Required to Implement Statutes or 
Executive Orders Applicable to GSA Acquisition of Commercial Items (FEB 
                                  1996)

    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 clauses that apply or 
delete the clauses that do not apply from the list. The contracting 
officer may add the date of the clause if desired for clarity.]

--552.223-70  Hazardous Substances
--552.223-71  Hazardous Material Information
--552.223-72  Nonconforming Hazardous Material
--552.225-70  Buy American Act--Hand or Measuring Tools or Stainless 
Steel Flatware
--552.225-71  Notice of Procurement Restriction--Hand or Measuring Tools 
or Stainless Steel Flatware

[[Page 425]]

--552.238-70  Identification of Electronic Office Equipment Providing 
Accessibility for the Handicapped
--552.238-75  Identification of Energy-Efficient Office Equipment and 
Supplies Containing Recovered Materials or Other Environmental 
Attributes
--552.238-77  Industrial Funding Fee

(End of Clause)
[61 FR 6171, Feb. 16, 1996]



552.212-73  Evaluation--Commercial Items (Multiple Award Schedule).

    As prescribed in 48 CFR 512.301(a)(4), insert the following 
provisions:

    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.
[62 FR 44524, Aug. 21, 1997]



552.214-16  Minimum bid acceptance period.

    As prescribed in 514.270, insert the following provision:

   Minimum Bid Acceptance Period (Oct 1985) (Deviation FAR 52.214-16)

    (a) ``Acceptance period,'' as used in this provision, means the 
number of calendar days available to the Government for awarding a 
contract from the date specified in this solicitation for receipt of 
bids.
    (b) This provision supersedes any language pertaining to the 
acceptance period that may appear elsewhere in this solicitation.
    (c) The Government requires a minimum acceptance period of ____*____ 
calendar days.
    (d) In the space provided immediately below, bidders may specify a 
longer acceptance period than the Government's minimum requirement. 
(Insert any number equal to or greater than the minimum requirement 
stated in paragraph (c) of this provision. Failure to insert any number 
means the offeror accepts the minimum in paragraph (c)).
The bidder allows the following total acceptance period: ______ calendar 
days.
    (e) A bid allowing less than the Government's minimum acceptance 
period will be rejected.
    (f) The bidder agrees to execute all that it has undertaken to do, 
in compliance with its bid, if that bid is accepted in writing within 
(1) the acceptance period stated in paragraph (c) above, or (2) any 
longer acceptance period stated in paragraph (d) above, or (3) any 
extension of the offered acceptance period as may be subsequently agreed 
to by the bidder.

                           (End of Provision)

    *The contracting officer shall insert an appropriate number of days.



552.214-73  ``All or none'' offers.

    As prescribed in 514.201-6(a), insert the following provision:

[[Page 426]]

                    ``All or None'' Offers (Apr 1984)

    (a) Unless awards in the aggregate are specifically precluded in 
this solicitation, the Government reserves the right to evaluate offers 
and make awards on an ``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 (Apr 1984)

    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.



552.214-74  Solicitation copies.

    As prescribed in 514.201-6(b), insert the following notice:

                     Solicitation Copies (May 1989)

    To reduce costs, only one copy of this solicitation is mailed to 
active bidders and to addressees on our bidders' mailing list. If 
additional copies are required by the solicitation, you may reproduce 
them yourself, provided they are complete in every respect, or you may 
obtain them from the address specified below:

__________________________________________
__________________________________________
__________________________________________
Tel.____________________
(End of Notice)



552.214-75  Progressive awards and monthly quantity allocations.

    As prescribed in 514.201-7(a), insert the following clause:

     Progressive Awards and Monthly Quantity Allocations (May 1989)

    (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 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                  
------------------------------------------------------------------------
      Items or groups of items           Monthly allocation 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)



552.214-76  Bid sample requirements.

    As prescribed in 514.202-4(a)(4), insert the following provision:

[[Page 427]]

                   Bid Sample Requirements (May 1989)

    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:

                                                                        
------------------------------------------------------------------------
               Items                  Acceptable representative samples 
------------------------------------------------------------------------
                                     ...................................
------------------------------------------------------------------------
                                     ...................................
------------------------------------------------------------------------
------------------------------------------------------------------------

    Note: (1) Bidders ____ Are or ____ 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. Samples must be submitted with the original copy of 
the attached GSA Form 434 enclosed and properly executed.
    Caution: Use proper address for method of shipment selected.

                                                                        
------------------------------------------------------------------------
           Mail and parcel post                  Freight or express     
------------------------------------------------------------------------
(Insert Address of Bid Sample Room).......  (Insert Address of Bid      
                                             Sample Room).              
------------------------------------------------------------------------

    (e) Samples shall be disposed of, after they have served the 
Government's purpose, pursuant to a bidder's instructions indicated on 
GSA Form 434.

                           (End of Provision)



552.215-70  Examination of records by GSA.

    As prescribed in 515.106-70 and 514.201-7(b), 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 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)

[54 FR 26558, June 23, 1989, as amended at 61 FR 6172, Feb. 16, 1996]



552.215-71  Examination of records by GSA (Multiple Award Schedule).

    As prescribed in 48 CFR 515.106-70, insert the following clause:

   Examination of Records by GSA (Multiple Award Schedule) (AUG 1997)

    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 clause of this contract. This 
authority shall

[[Page 428]]

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)

[62 FR 44525, Aug. 21, 1997]



552.215-72  Price adjustment--Failure to provide accurate information.

    As prescribed in 48 CFR 515.804-6(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 the 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)

[62 FR 44525, Aug. 21, 1997]



552.216-71  Economic price adjustment--FSS multiple award schedule contracts.

    As prescribed in 516.203-4(b), insert the following clause:

                  Economic Price Adjustment (FEB 1996)

    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:
    (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.

[[Page 429]]

    (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 addressees 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 indicating that a 
different percentage is more appropriate. Any ceiling other than 10 
percent must be approved by the contracting director.

                         Alternate I (Jan 1989)

    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.

                             (End of Clause)

* 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.
[54 FR 26558, June 23, 1989, as amended at 61 FR 6172, Feb. 16, 1996; 61 
FR 10846, Mar. 15, 1996]



552.216-72  Economic Price Adjustment--Stock and Special Order Program Contracts.

    As prescribed in 516.203-4(c)(2), insert the following clause:

  Economic Price Adjustment--Stock and Special Order Program Contracts 
                               (Aug 1990)

    (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 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] TC13NO91.025

    (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

[[Page 430]]

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 (Aug 1990)

    As prescribed in 516.203-4(c)(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] TC13NO91.026

    (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] TC13NO91.027

    (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 Contractor 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 (Aug 1990)

    As prescribed in 516.203-4(c)(2), add the following paragraph (g) to 
the basic clause.
    (g) No price adjustment will be made unless the percentage change 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.
[55 FR 39279, Sept. 26, 1990]



552.216-73  Placement of orders.

    As prescribed in 516.505(a), insert the following clause:

                     Placement of Orders (June 1994)

    (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

[[Page 431]]

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 
items 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, Systems Inventory and Operations 
Management Center (FCS), Washington, DC 20406, Telephone: [Contracting 
Officer insert appropriate telephone numbers] FAX:
    Alternate I (June 1994). As prescribed in 516.505(a), 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 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 and placed, the 
transaction sets used, security procedures, and guidelines for 
implementation.
    Alternate II (June 1994). As prescribed in 516.505(a), substitute 
the following paragraph (a) for paragraph (a) of the basic clause:
    (a) Delivery orders under this contract may be placed by either the 
using Federal agencies or the General Services Administration's Federal 
Supply Service (FSS).
[59 FR 32384, June 23, 1994]



552.216-74  Ordering information.

    As prescribed in 516.505(b), insert the following provision:

                    Ordering Information (June 1994)

    (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 (  ) facsimile transmission or (  
) 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 (June 1994). As prescribed in 516.505(b), delete 
paragraph (d) of the basic provision:
    Alternate II (June 1994). As prescribed in 516.505(b), add the 
following paragraph (e) to the basic provision:
    (e) Offerors marketing through dealers are requested to indicate 
below whether those 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.
[59 FR 32385, June 23, 1994]



552.217-70  Evaluation of Options.

    As prescribed in 517.208, 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

[[Page 432]]

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.

                           (End of Provision)

[55 FR 39280, Sept. 26, 1990]



552.217-71  Notice Regarding Option(s).

    As prescribed in 517.208(a), 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)
[57 FR 59939, Dec. 17, 1992]



552.219-71  Allocation of orders--partially set-aside items.

    As prescribed in 519.508, insert the following clause:

       Allocation of Orders--Partially Set-Aside Items (June 1986)

    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)

[54 FR 26558, June 23, 1989, as amended at 54 FR 40060, Sept. 29, 1989]



552.219-72  Notice to offerors of subcontracting plan requirements.

    As prescribed in 519.708(a), insert the following provision:

    Notice of Offerors of Subcontracting Plan Requirements (DEC 1995)

    The General Services Administration (GSA) is committed to assuring 
that maximum practicable opportunity is provided to small, small 
disadvantaged, and women-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, Small Disadvantaged and Women Owned 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) will be 
required to demonstrate that its subcontracting plan represents a 
creative and innovative program for involving small, small 
disadvantaged, and women-owned small business concerns as subcontractors 
in the performance of this contract.

                           (End of Provision)

[61 FR 1152, Jan. 17, 1996]



552.219-73  Preparation, submission, and negotiation of subcontracting plans.

    As prescribed in 519.708(b), insert the following provision:

 PREPARATION, SUBMISSION, AND NEGOTIATION OF SUBCONTRACTING PLANS (DEC 
                                  1995)

    (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 products plan. Maximum

[[Page 433]]

practicable utilization of small, small disadvantaged, and women-owned 
small business concerns as subcontractors is a matter of national 
interest with both social and economic benefits. It is the General 
Services Administration's (GSA's) expectation that an offeror's 
subcontracting plan will reflect a commitment to assuring that small, 
small disadvantaged, and women-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 products 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.
    (b) GSA believes that this potential contract provides significant 
opportunities for the use of small, small disadvantaged, and women-owned 
small business concerns as subcontractors. Consequently, in addressing 
the eleven elements described in FAR 52.219-9(d) of the clause in this 
contract entitled Small, Small Disadvantaged and Women-Owned Small 
Business Subcontracting Plan, the offeror shall demonstrate that its 
subcontracting plan represents a creative and innovative program for 
involving small, small disadvantaged, and women-owned small business 
concerns in performing the contract. The subcontracting plan shall 
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. 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.
    (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 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 
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, small disadvantaged, and women-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, small disadvantaged, 
and women-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)
[59 FR 38936, Aug. 1, 1994, as amended at 61 FR 1152, Jan. 17, 1996]



552.219-74  Goals for Subcontracting Plan.

    As prescribed in 519.708(c), insert the following provision:

                GOALS FOR SUBCONTRACTING PLAN (DEC 1995)

    (a) Maximum practicable utilization of small, small disadvantaged, 
and women-owned small business concerns as subcontractors is a matter of 
national interest with both social and economic benefits.
    (1) The General Services Administration's (GSA's) commitment to 
ensuring that maximum practicable opportunity is provided to small, 
small disadvantaged, and women-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, Small Disadvantaged and Women-Owned 
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, small 
disadvantaged, and women-owned small business concerns in performing 
this contract. An offeror submitting a commercial products plan can 
demonstrate its commitment in providing maximum practicable 
opportunities through subcontracting opportunities it provides to small, 
small disadvantaged, and women-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,

[[Page 434]]

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, small disadvantaged, and women-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
Small Disadvantaged Business ________ percent
Women-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, small disadvantaged, and women-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, small disadvantaged, 
and women-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 (DEC 1995)

    The Contracting Officer, as prescribed in 519.708(c), shall delete 
paragraph (b) of the basic provision and redesignate paragraphs (c) and 
(d) as paragraphs (b) and (c).
[59 FR 38936, Aug. 1, 1994; 59 FR 45063, Aug. 31, 1994, as amended at 61 
FR 1152, Jan. 17, 1996; 61 FR 39089, July 26, 1996; 61 FR 42462, Aug. 
15, 1996]



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 Substances 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)

[54 FR 26558, June 23, 1989, as amended at 56 FR 1741, Jan. 17, 1991]



552.223-71  Hazardous material information.

    As prescribed in 523.370, insert the following provision:

                Hazardous Material Information (Apr 1984)

    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)



552.223-72  Nonconforming hazardous materials.

    As prescribed in 523.303(b), insert the following clause:

[[Page 435]]

              Nonconforming Hazardous Materials (Mar 1992)

    (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(c) 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)

[56 FR 1741, Jan. 17, 1991, as amended at 57 FR 14649, Apr. 22, 1992]



552.225-8  Trade Agreements Act Certificate.

    As prescribed in 525.407(a), insert the following provision:

               TRADE AGREEMENTS ACT CERTIFICATE (DEC 1994)

                        (DEVIATION FAR 52.225-8)

    (a) The Offeror, by signing this offer, certifies that each end 
product to be delivered under this contract is a U.S. made end product, 
a designated country end product, a Caribbean Basin country end product, 
a Canadian end product or a Mexican end product as defined in the clause 
entitled ``Trade Agreements Act'' at 48 CFR 552.225-9.
    (b) Offers will be evaluated in accordance with subpart 25.4 of the 
Federal Acquisition Regulation except that offers of U.S. made end 
products, designated country end products, Caribbean Basin end products, 
Canadian end products, or Mexican end products shall be evaluated 
without the restrictions of the Buy American Act or the Balance of 
Payments Program.

                           (End of Provision)

[59 FR 64857, Dec. 16, 1994]



552.225-9  Trade Agreements Act.

    As prescribed in 525.407(a), insert the following clause.

                     TRADE AGREEMENTS ACT (DEC 1994)

                        (DEVIATION FAR 52.225-9)

    (a) This clause implements the Trade Agreements Act of 1979 (19 
U.S.C. 2501-2582) by providing a preference for U.S. made end products, 
designated country end products, Caribbean Basin country end products, 
Canadian end products or Mexican end products over other products.
    ``Caribbean Basin country end products,'' as used in this clause, 
means an article that: (1) is wholly the growth, product, or manufacture 
of a Caribbean Basin country (as defined in section 25.401 of the 
Federal Acquisition Regulation (FAR)), or (2) in the case of an article 
which consists in whole or in part of materials from another country or 
instrumentality, has been substantially transformed into a new and 
different article of commerce with a name, character, or use distinct 
from that of the article or articles from which it was so transformed. 
The term includes services (except transportation services) incidental 
to its supply; provided that the value of those incidental services does 
not exceed that of the product itself. It does not include service 
contracts as such. The term excludes products that are excluded from 
duty free treatment from Caribbean countries under the Caribbean Basin 
Economic Recovery Act (19 U.S.C. 2703(b)). These exclusions presently 
consist of (i) textiles and apparel articles that are subject to textile 
agreements; (ii) footwear, handbags, luggage, flat goods, work gloves, 
and leather wearing apparel not designated as eligible articles for the 
purpose of the Generalized System of Preference under title V of the 
Trade Act of 1974; (iii) tuna, prepared or preserved in any manner in 
airtight containers, (iv) petroleum, or any product derived from 
petroleum; and (v) watches and watch parts (including cases, bracelets 
and straps) of whatever type including, but not limited to, mechanical, 
quartz digital or quartz analog, if such watches or watch parts contain 
any material that is the product of any country to which the Tariff 
Schedule of the United States (TSUS) column 2 rates of duty apply.
    ``Designated country end product,'' as used in this clause, means an 
article that (1) is wholly the growth, product, or manufacture

[[Page 436]]

of the designated country (as defined in section 25.401 of the Federal 
Acquisition Regulation (FAR)), or (2) in the case of an article which 
consists in whole or in part of materials from another country or 
instrumentality, has been substantially transformed into a new and 
different article of commerce with a name, character, or use distinct 
from that of the article or articles from which it was so transformed. 
The term includes services (except transportation services) incidental 
to its supply, provided that the value of those incidental services does 
not exceed that of the product itself. It does not include service 
contracts as such.
    ``Canadian end product,'' as used in this clause, means an article 
that (1) is wholly the growth, product, or manufacture of Canada, or (2) 
in the case of an article which consists in whole or in part of 
materials from another country or instrumentality, has been 
substantially transformed in Canada into a new and different article of 
commerce with a name, character, or use distinct from that of the 
article or articles from which it was transformed. The term includes 
services (except transportation services) incidental to its supply; 
provided, that the value of those incidental services does not exceed 
that of the product itself. It does not include service contracts as 
such.
    ``Mexican end product,'' as used in this clause, means an article 
that (1) is wholly the growth, product, or manufacture of Mexico, or (2) 
in the case of an article which consists in whole or in part of 
materials from another country or instrumentality, has been 
substantially transformed in Mexico into a new and different article of 
commerce with a name, character, or use distinct from that of the 
article or articles from which it was so transformed. The term includes 
services (except transportation services) incidental to its supply, 
provided that the value of those incidental services does not exceed 
that of the product itself. It does not include service contracts as 
such.
    ``End products,'' as used in this clause, means those articles, 
materials, and supplies to be acquired under this contract for public 
use.
    ``U.S. made end product,'' as used in this clause, means an article 
which (1) is wholly the growth, product, or manufacture of the United 
States, or (2) in the case of an article which consists in whole or in 
part of materials from another country or instrumentality, has been 
substantially transformed in the United States into a new and different 
article of commerce with a name, character, or use distinct from that of 
the article or articles from which it was so transformed.
    ``Nondesignated country end products,'' as used in this clause, 
means any end product which is not a U.S. made end product, designated 
country end product, Caribbean Basin Country end product, Canadian end 
product or Mexican end product.
    ``United States,'' as used in this clause, means the United States, 
its possessions, Puerto Rico, and any other place which is subject to 
its jurisdiction, but does not include leased bases or trust 
territories.
    (b) The Contractor agrees to deliver under this contract only U.S. 
made end products, designated country end products, Caribbean Basin 
country end products, Canadian end products or Mexican end products or, 
if a national interest waiver is granted under section 302 of the Trade 
Agreements Act of 1979, nondesignated country end products. Only if such 
waiver is granted may a nondesignated country end product be delivered 
under this contract(s).
    (c) Offers will be evaluated in accordance with the policies and 
procedures of Part 25 of the FAR except that offers of U.S. made end 
products, designated country end products, Caribbean Basin end products, 
Canadian end products or Mexican end products shall be evaluated without 
the restrictions of the Buy American Act or the Balance of Payments 
Program.

                             (End of Clause)

[59 FR 64857, Dec. 16, 1994]



552.225-70  Buy American Act--hand or measuring tools or stainless steel flatware.

    As prescribed in 525.105-70(d), insert the following provision:

 Buy American Act--Hand or Measuring Tools or Stainless Steel Flatware 
                               (May 1989)

    Offers of foreign end products will be evaluated in accordance with 
GSAR 525.105-70(c) (48 CFR 525.105-70(c)). Offerors that intend to 
supply foreign end products must specify below or on an attachment to 
this offer the amount of duty (a) applicable if a duty-free entry 
certificate was not issued (for Canadian end products only) or (b) 
included in each offered price (for all other offers of foreign end 
products). If no duty is specified, the differential in GSAR 525.105-
70(c)(2)(i) will be applied to the offered price.

                                                                        
------------------------------------------------------------------------
                                                   Amount of duty (in   
       Item No.                  Unit              dollars and cents)   
------------------------------------------------------------------------
                       .......................  ........................
------------------------------------------------------------------------
                       .......................  ........................
------------------------------------------------------------------------
                       .......................  ........................

[[Page 437]]

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

                           (End of Provision)

[54 FR 26558, June 23, 1989, as amended at 54 FR 40060, Sept. 29, 1989]



552.225-71  Notice of procurement restriction--hand or measuring tools or stainless steel flatware.

    As prescribed in 525.105-71(c), insert the following clause:

Notice of Procurement Restriction--Hand or Measuring Tools or Stainless 
                        Steel Flatware (May 1989)

    (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)



Sec. 552.225-72  Eligible Products from Nondesignated Countries--Waiver.

    As prescribed in 525.407(b), insert the following clause:

    Eligible Products From Nondesignated Countries--Waiver (Aug 1992)

    (a) In accordance with the Trade Agreements Act of 1979 and 48 CFR 
25.402(b), no eligible product that originates in a nondesignated 
country may be purchased by a Federal agency. However, this restriction 
may be waived before award when it is determined to be in the national 
interest. Accordingly, offers to furnish products originating in a 
nondesignated country identified in paragraph (c) below, may be 
submitted in response to this solicitation and will be considered for 
award if a waiver is obtained from the U.S. Trade Representative or a 
designee (19 U.S.C. 2512) on the basis that:
    (1) No responsive bid or technically acceptable offer from a 
responsible offeror is received offering U.S. or designated country end 
products, Caribbean Basin country end products, Canadian or Mexican end 
products as defined in the clause entitled ``Trade Agreement Act'' in 
this solicitation; or
    (2) Responsible offerors do not offer a sufficient quantity to meet 
the Government's requirements.
    (b) The determination to seek a waiver is at the sole discretion of 
the acquiring activity, and the granting of such waiver will be at the 
sole discretion of the U.S. Trade Representative or designee (48 CFR 
525.402).
    (c) The Offeror certifies that the following product(s) is an end 
product other than an end product of the United States, a designated 
country or a Caribbean Basin country Canadian or Mexican end products, 
as such end products are defined in the clause entitled ``Trade 
Agreements Act'' in this solicitation:

                                                                        
------------------------------------------------------------------------
                Line item number                    Country of origin   
------------------------------------------------------------------------
                                                 .......................
                                                 .......................
                             (End of Clause)                            
------------------------------------------------------------------------

[57 FR 42709, Sept. 16, 1992, as amended at 59 FR 64858, Dec. 16, 1994; 
60 FR 21467, May 2, 1995]



552.225-75  Buy American Act Notice--Construction Materials.

    As prescribed in 525.205, insert the following provision:

       BUY AMERICAN ACT NOTICE--CONSTRUCTION MATERIALS (JAN 1994)

    (a) The Buy American Act (41 U.S.C. 10) generally requires that only 
domestic construction material be used in performing this contract (See 
the clause entitled ``Buy American Act--Construction Materials''). This 
requirement does not apply to the excepted construction material or 
components listed below:

       (List applicable excepted materials or indicate ``none.'')

    (b) Offers based on the use of other foreign construction material 
may be acceptable for award if the Government determines that--
    (1) Comparable domestic construction material in sufficient and 
reasonably available quantities, of a satisfactory quality, is 
unavailable; or

[[Page 438]]

    (2) Use of comparable domestic construction material is 
impracticable or would unreasonably increase the cost of this contract.
    (c) Any offer based on the use of one or more other foreign 
construction materials shall include current data, based on a reasonable 
canvass of suppliers, in the format listed in paragraph (g) below, 
clearly demonstrating that the cost of each other foreign construction 
material, plus 6 percent, is less than the cost of each comparable 
domestic construction material. The cost of construction material shall 
include all delivery costs to the construction site and any applicable 
duty (whether or not a duty-free entry certificate may be issued).
    (d) For evaluation purposes, the Government will add to the offer 6 
percent of the cost of other foreign construction material that 
qualifies for acceptance under paragraph (c) above.
    (e) When offering other foreign construction material, offerors may 
also offer, at stated prices, any available comparable domestic 
construction material to avoid the possibility that the entire offer 
will be rejected if the other foreign construction material is not 
accepted under (c) above. If any other foreign construction material 
does not qualify for acceptance under paragraph (c) above, the 
Government will evaluate the offer on the basis of the stated price for 
comparable domestic construction material, and the Offeror shall be 
required to furnish such domestic construction material at that price. 
If the Offeror does not state a price for a comparable domestic 
construction material, and the other foreign construction material does 
not qualify for acceptance under paragraph (c) above, the offer will be 
rejected in sealed bid procurements and may be rejected in negotiated 
procurements.
    (f) If the foregoing procedure results in a tie between a foreign 
offer as evaluated and a domestic offer, award shall be made on the 
domestic offer. In such case, offers proposing to use any foreign 
construction material will be considered to be foreign offers.
    (g) For evaluation purposes under paragraph (c) above, the following 
information and any applicable supporting data based on the canvass of 
suppliers shall be included in the offer for the use of one or more 
other foreign construction materials:

                           Foreign and Domestic Construction Materials Cost Comparison                          
----------------------------------------------------------------------------------------------------------------
                                                              Unit of                                           
             Construction material description                measure  Quantity         Cost (dollars)\1\       
----------------------------------------------------------------------------------------------------------------
Item 1:                                                                                                         
    Foreign construction material..........................  ........  ........  $                              
    Comparable domestic construction material..............  ........  ........  $                              
Item 2:                                                                                                         
    Foreign construction material..........................  ........  ........  $                              
    Comparable domestic construction material..............  ........  ........  $                              
----------------------------------------------------------------------------------------------------------------
\1\ Include all delivery costs to the construction site and any applicable duty.                                

                           (End of Provision)

    Alternate I (JAN 1994). If Alternate I is used, paragraphs (a) and 
(f) of the basic clause should be deleted and the following paragraphs 
(a) and (f) substituted. In addition, two asterisks should be inserted 
after the phrase ``Foreign construction material'' each time it appears 
in the chart in paragraph (g) and the following explanation added at the 
bottom of the chart ``* * * Do not include EC or NAFTA country 
construction materials.''
    (a) The Buy American Act (41 U.S.C. 10) generally requires that only 
domestic construction material be used in performing this contract. 
However, the Memorandum of Understanding between the United States of 
America and the European Community (EC) on Government procurement and 
the North American Free Trade Agreement (NAFTA) exempt EC and NAFTA 
country construction material from application of the Buy American Act. 
(See FAR 52.225-15 ``Construction Materials under European Community and 
NAFTA Agreements''). Therefore, the Contractor shall use only domestic 
construction material, EC construction materials, or NAFTA country 
construction materials in the performance of this contract except for 
other foreign construction materials, if any, listed below. ``Other 
foreign construction material,'' as used in this provision, means 
construction material that is not EC or NAFTA country construction 
material as defined in FAR 52.225-15.

       (List applicable excepted materials or indicate ``none.'')

    (f) If the foregoing procedure results in a tie between an offer 
that includes other foreign construction material as evaluated and an 
offer that includes domestic, EC or NAFTA construction material, award 
shall be made on the offer providing domestic, EC or NAFTA construction 
material.
[59 FR 64858, Dec. 16, 1994]

[[Page 439]]



552.227-70  Government rights (unlimited).

    As prescribed in 527.409(a), 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  Bid guarantee and bonds.

    As prescribed in 528.101-3(a) insert a clause substantially the same 
as follows:

                   Bid Guarantee and Bonds (May 1989)

    A bid guarantee is required as provided in Standard Form 1442, 
Solicitation, Offer and Award (Construction, Alteration, or Repair).
    (a) If the contract price is more than $25,000, the Contractor shall 
furnish a performance bond in a penal amount of 100 percent of the 
contract price, and payment bond in a penal amount as follows:
    (1) Fifty percent of the contract price if the contract price is 
more than $25,000 but not more than $1,000,000; or
    (2) Forty percent of the contract price if the contract price is 
more than $1,000,000 but not more than $5,000,000; if the contract price 
is over $5,000,000, then forty percent of the contract price or 
$2,500,000, whichever is less.
    (b) If offers on one or more alternate and/or unit price offers were 
accepted in awarding the contract, contract price as used above shall 
mean the aggregate of the lump sum amount plus the product of each unit 
price accepted multiplied by the applicable number of units specified in 
the bid form, plus or minus such alternate offers as were accepted.
    (c) Performance and payment bonds shall be submitted within the time 
specified on the Standard Form 1442, Solicitation, Offer, and Award, for 
this contract.
    (d) The Contractor shall not lose the right to receive any payment 
due or to become due under the contract unless and until the surety has 
made payment in settlement of claims by suppliers of labor or material 
in accordance with the requirements of the surety's undertaking under 
the payment or performance bond and has notified the Contracting Officer 
of the claims and amount so paid.

(End of Clause)
[54 FR 26558, June 23, 1989, as amended at 58 FR 52446, Oct. 8, 1993]



552.228-71  Bid guarantee.

    As prescribed in 528.101-3(b), insert a clause substantially as 
follows:

                        Bid Guarantee (May 1989)

    If the contract price is more than $25,000, offerors shall furnish a 
bid guarantee in a penal amount of ______ percent of the offer price for 
the term of the contract (excluding options to extend the term of the 
contract, if any) or $3,000,000, whichever is less.
    For bid guarantee purposes the amount of the offer shall be deemed 
to be the aggregate of each unit price bid multiplied by the applicable 
number of units shown on the offer form or in the method of award 
formula.

[[Page 440]]

                             (End of Clause)



552.228-72  Performance bond.

    As prescribed in 528.103-2(d), insert a clause substantially as 
follows:

                       Performance Bond (Feb 1990)

    (a) The Offeror to whom the award is made shall furnish a 
performance bond for the protection of the Government in an amount equal 
to ---- percent of the contract price for the base term of the contract. 
In determining the bond amount, ``base term of the contract'' refers to 
the initial period of performance EXCLUDING ANY OPTION(S). The guaranty 
shall cover the base term of the contract and any extensions thereof 
excluding any option(s) to extend the term of the contract.
    (b) When the government exercises an option that extends the term of 
the contract, the Contractor shall be required to furnish an additional 
performance bond in an amount equal to ---- percent of the contract 
price for each option term exercised by the Government. In determining 
the bond amount, ``option term'' refers to the period of performance for 
the option being exercised. The guaranty for each option exercised shall 
cover the option term and any extensions thereof.
    (c) The bond shall be provided within 15 calendar days after 
receiving written notice of award (or acceptance of offer) for the base 
term of the contract or written notification of the exercised option. 
The period of time for furnishing the performance bond may be extended 
for 10 calendar days, if fully justified in the opinion of the 
Contracting Officer, and if the request for the extension is received or 
confirmed in writing within the original 15 calendar day period. Failure 
of the Contractor to provide the required bond may be cause to terminate 
the Contractor's right to proceed under the base of option term of the 
contract.
    (d) The failure of a surety to renew a bond for any option term 
shall not result in a default of the bond previously furnished covering 
any base or option term.
    (e) The performance bond shall be a firm commitment, supported by 
corporate sureties whose names appear on the list contained in Treasury 
Department Circular 570, individual sureties, or by other acceptable 
security such as postal money order, certified check, cashier's check, 
or in accordance with Treasury Department regulations, certain bonds or 
notes of the United States.

                             (End of Clause)

[55 FR 5224, Feb. 14, 1990, as amended at 55 FR 9886, Mar. 16, 1990]



552.228-73  Performance and Payment Bonds.

    As prescribed in 528.103-3(c), insert a clause substantially as 
follows:

                Performance and Payment Bonds (Feb 1990)

    (a) The Offeror to whom the award is made shall furnish a 
performance bond for the protection of the Government in an amount equal 
to ---- percent of the contract price and a payment bond in an amount 
equal to ---- percent of the contract price for the base term of the 
contract. In determining the bond amount, ``base term of the contract'' 
refers to the initial period of performance EXCLUDING ANY OPTION(S). The 
guaranty shall cover the base term of the contract and any extensions 
thereof excluding any option(s) to extend the term of the contract.
    (b) Prior to exercise of any option that extends the term of the 
contract, the Contractor shall be required to furnish an additional 
performance bond in an amount equal to ---- percent of the contract 
price and a payment bond in an amount equal to ---- percent of the 
contract price for each option term exercised by the Government. In 
determining the bond amount, ``option term'' refers to the period of 
performance for the option being exercised. The guaranty for each option 
exercised shall cover the option term and any extensions thereof.
    (c) The bonds shall be provided within 15 calendar days after 
receiving written notice of award (or acceptance of offer) for the base 
term of the contract or written notification of the exercised option. 
The period of time for furnishing the bonds may be extended for 10 
calendar days, if fully justified in the opinion of the Contracting 
Officer, and if the request for the extension is received or confirmed 
in writing within the original 15 calendar day period. Failure to 
provide the required bonds may be cause to terminate the Contractor's 
right to proceed under the base or option term of the contract.
    (d) The failure of a surety to renew a bond for any option term 
shall not result in a default of the bond previously furnished covering 
any base or option term.
    (e) The performance and payment bonds shall be a firm commitment, 
supported by corporate sureties whose names appear on the list contained 
in Treasury Department Circular 570, individual sureties, or by other 
acceptable security such as postal money order, certified check, 
cashier's check, or in accordance with Treasury Department regulations, 
certain bonds or notes of the United States.

                             (End of Clause)

[55 FR 5224, Feb. 14, 1990]

[[Page 441]]



552.228-75  Workmen's compensation laws.

    As prescribed in 528.310, insert the following clause:

                 Workmen's Compensation Laws (Apr 1984)

    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 workmen's 
compensation laws to all lands and premises owned or held by the United 
States.

                             (End of Clause)

[54 FR 26558, June 23, 1989, as amended at 54 FR 40060, Sept. 29, 1989]



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 exempt and which was not included in 
the contract price.

                             (End of Clause)



552.229-72  Federal Excise Tax--DC Government.

    As prescribed in 529.401-72, insert the following clause:

              Federal Excise Tax--DC Government (Feb 1990)

    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)

[55 FR 6256, Feb. 22, 1990]



552.232-8  Discounts for prompt payments.

    As prescribed in 532.111(a), 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)



552.232-23  Assignment of claims.

    As prescribed in 532.806, insert the following clause:

                     Assignment of Claims (May 1989)

    Because this is a requirements or indefinite quantity contract under 
which more than one agency may place orders, paragraph

[[Page 442]]

(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, no 
claim(s) for amounts due or to become due under this contract, shall be 
assigned by the Contractor; but it shall be permissible for the 
Contractor 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 delivery order amounting to $1,000 or more 
issued by any Government agency under this contract. Any such assignment 
shall be effective 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 delivery order and the finance 
office designated in the delivery order to make payment. Unless 
otherwise stated in the delivery order, payments to an assignee of any 
amounts due or to become due under any delivery order assigned may, to 
the extent specified in the Act, be subject to reduction or set-off.

                             (End of Clause)



552.232-70  Payments by electronic funds transfer.

    As prescribed in 532.908(a), insert the following clause:

            Payments by Electronic Funds Transfer (Apr 1989)

    The submission of a designation of financial institution for receipt 
of electronic funds transfer payments in the ``Electronic Funds Transfer 
Payment Methods'' clause (FAR 52.232-28) shall be as follows. The 
Contractor shall submit its designation of a financial institution for 
receipt of electronic funds transfer payments with each invoice 
requesting payment of $25,000 or more (exclusive of any discount for 
prompt payment). The information for electronic funds transfer is not 
required by the Department of Defense, the United States Postal Service, 
or the Tennessee Valley Authority. Information required for electronic 
funds transfer payments shall be furnished to the Veterans 
Administration in accordance with instructions provided by that agency. 
Other agencies and departments thereof may waive the requirement for 
designation of a financial institution for receipt of electronic funds 
transfer payments and for submission of information required to make 
such payments by including a notice on delivery orders or otherwise 
notifying the Contractor.

                             (End of Clause)



552.232-71  Prompt payment.

    As prescribed in 532.908(b), insert the following clause:

                        Prompt Payment (Apr 1989)

    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) Name 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).

[[Page 443]]

    (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 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 (Apr 1989)

    If Alternate I is used, subparagraph (a)(1) of the basic 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).



552.232-72  Invoice requirements.

    As prescribed in 532.111(b), insert the following clause:

                     Invoice Requirements (Apr 1989)

    (a) Invoices shall be submitted in an original only, unless 
otherwise specified, to the designated billing office specified in this 
contract or purchase/delivery order.
    (b) Invoices must include the Accounting Control Transaction (ACT) 
number provided below or on the purchase/delivery order.

             ACT Number (Contracting Officer Insert Number)

    (c) In addition to the requirements for a proper invoice specified 
in the Prompt Payment clause of this contract or purchase/delivery 
order, the following information or documentation must be submitted with 
each invoice:

           (Contracting Officer List Additional Requirements)

                             (End of Clause)



552.232-73  Electronic funds transfer payment.

    As prescribed in 532.908(c), insert the following clause:

              Electronic Funds Transfer Payment (Aug 1992)

    (a) Payments under this lease will be made by the Government either 
by check or electronic funds transfer (EFT). If the Lessor elects to 
receive payment by EFT, after award, but no later than 30 days before 
the first payment, the Lessor shall designate a financial institution 
for receipt of EFT payments, and shall submit this designation to the 
Contracting Officer or other Government official, as directed.
    (b) For payment by EFT, the Lessor shall provide the following 
information:
    (1) The American Bankers Association 9-digit identifying number for 
wire 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, a ``Payment 
Information Form,'' SF 3881, must be completed before payment can be 
processed.
    (c) In the event the Lessor, during the performance of this 
contract, elects to designate a different financial institution for the 
receipt of any payment made using EFT procedures, notification of such 
change and the required information specified above

[[Page 444]]

must be received by the appropriate Government official no later than 30 
days prior to the date such change is to become effective.
    (d) The documents furnishing the information required in this clause 
must be dated and contain the signature, title, and telephone number of 
the Lessor or an authorized representative designated by the Lessor, as 
well as the Lessor's name and lease number.
    (e) Lessor 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)
[57 FR 37890, Aug. 21, 1992]



552.232-77  Availability of funds.

    As prescribed in 532.705-1, insert the following clause:

                    Availability of Funds (July 1984)

    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 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)



552.232-78  Adjusting payments.

    As prescribed in 532.111(c), insert the following clause:

                      Adjusting Payments (May 1989)

    (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 Officer 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 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)

[54 FR 26558, June 23, 1989, as amended at 54 FR 40060, Sept. 29, 1989]



552.232-79  Final payment.

    As prescribed in 532.111(d), insert the following clause:

                        Final Payment (Apr 1986)

    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 the Assignment of Claims Act of 1940, as amended (31 
U.S.C. 3727, 41 U.S.C. 15), a release may also be required of the 
assignee.

                             (End of Clause)



552.232-80  Payment by credit card.

    As prescribed in 532.7003, insert the following clause:

                    Payment by Credit Card (Dec 1989)

    (a) Definitions. ``Government commercial credit card'' means the 
uniquely numbered credit card issued by the Contractor under single 
award schedule, Federal Supply Schedule IG 615, Governmentwide 
Commercial Credit Card Service, to named individual Government employees 
to pay for official Government purchases.
    ``Oral delivery order'' means an order placed orally either in 
person or by telephone, which is paid for by Government commercial 
credit card.
    (b) At the option of the Government and if agreeable to the 
Contractor, payments of $25,000 or less for oral or written delivery 
orders may be made using the Government commercial credit card.
    (c) The Contractor shall not process a transaction for payment 
through the credit

[[Page 445]]

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 in accordance with other 
contract requirements, the Contractor shall immediately credit a 
cardholder's account for items returned as defective or faulty.

                             (End of clause)

[54 FR 26548, June 23, 1989, as amended at 54 FR 43181, Oct. 23, 1989]



552.233-70  Disputes (utility contract).

    As prescribed in 533.214, insert the following clause:

                 Disputes (Utility Contract) (Apr 1984)

    The requirements of the Disputes clause at FAR 52.233-1 are 
supplemented to provide that matters involving the interpretation of 
retail rates, rate schedules, tariffs, riders, and tariff related terms 
provided under this contract and conditions of service are subject to 
the jurisdiction and regulation of the utility rate commission having 
jurisdiction.

                             (End of Clause)



552.236-70  Definitions.

    As prescribed in 536.570-1, insert the following clause:

                         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

[[Page 446]]

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

    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 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

    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 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), 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

    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

[[Page 447]]

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.
[54 FR 26558, June 23, 1989, as amended at 54 FR 40061, Sept. 29, 1989]



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 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 (Apr 1984)

    The requirements of the clause entitled ``Specifications and 
Drawings'' 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 
the 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:

[[Page 448]]

     Shop Drawings, Coordination Drawings, and Schedules (Apr 1984)

    The requirements, of the clause entitled ``Specifications and 
Drawings'' 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) Shop drawings shall include fabrication, erection and setting 
drawings, schedule drawings, manufacturers' scale drawings, wiring 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 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 identity 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

[[Page 449]]

testing. Samples failing to meet contract requirements will 
automatically void previous approvals of the items tested. The 
Contractor shall replace such materials or equipment found not to have 
met 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;
    (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 produce 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 of 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 contract, 
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  Furnishing information and records.

    As prescribed in 536.570-14, insert the following clause:

              Furnishing Information and Records (Apr 1984)

    (a) If the Contractor or any subcontractor under this contract or 
the officers or agents of the Contractor or any subcontractor, refuses, 
except as provided by the terms of this contract, to furnish to any 
Government agency or any establishment in the legislative or judicial 
branch of the Government information or records reasonably pertinent to 
this contract, the following actions may be taken:
    (1) In the case of a refusal by the Contractor, its officers or 
agents, the Government may, after affording an opportunity to explain or 
justify such refusal, terminate the Contractor's right to proceed with 
the work. The rights and remedies provided in this clause are in 
addition to those outlined in paragraph (a) of the Default (Fixed-Price 
Construction) clause at FAR 52.249-10, paragraph (b) of the Liquidated 
Damages--Construction clause at FAR 52.212-5 and to any

[[Page 450]]

other rights and remedies provided by law or under this contract;
    (2) In the case of a refusal by a subcontractor, its officers or 
agents, the Government may, after affording an opportunity to explain or 
justify such refusal, require the Contractor to terminate the 
subcontract without cost to the Government, or if the Contractor fails 
or refuses to effect such termination, the Government may terminate the 
Contractor's right to proceed with the work under this contract and 
thereupon the Government may avail itself of the rights and remedies 
referred to in subparagraph (a)(1) of this clause.
    (b) The term ``subcontract'' as used in this paragraph means any 
contract entered into or any purchase order issued by a prime contractor 
under a contract with the Government in connection with the performance 
of the prime contractor's obligations under this contract.
    (c) The term ``subcontractor'' as used in this paragraph means a 
party to a subcontract other than the prime contractor under this 
contract.

                             (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 each 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  Certification regarding ``Quasi-Military Armed Forces.''

    As prescribed in 537.110(c), insert the following certification:

   Certification Regarding ``Quasi-Military Armed Forces'' (Apr 1984)

    (a) By signing this offer, the offeror certifies that the 
individual, firm, or corporation submitting this offer is not a ``Quasi-
Military Armed Force'' within the meaning of the decision of the court 
in United States ex. rel. Weinberger v. Equifax, 557 F. 2d 456 (5th 
Cir., 1977).
    (b) The Offeror further certifies that it will not, during the term 
of this contract, offer ``Quasi-Military Armed Forces'' for hire.

                         (End of Certification)

[54 FR 26558, June 23, 1989, as amended at 54 FR 40061, Sept. 29, 1989]



552.238-70  Identification of electronic office equipment providing accessibility for the handicapped.

    As prescribed in 538.203-71(b), insert the following clause:

[[Page 451]]

 Identification of Electronic Office Equipment Providing Accessibility 
                     for the Handicapped (Sept 1991)

    (a) Definitions. Electronic office equipment accessibility 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 means 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.
[56 FR 29443, June 27, 1991, as amended at 56 FR 51660, Oct. 15, 1991]



552.238-72  Contractor's report of sales.

    As prescribed in 538.203-71, insert the following clause:

                 Contractor's Report of Sales (MAY 1997)

    (a) The Contractor must furnish quarterly the dollar value (in U.S. 
dollars and rounded to the nearest whole dollar) of all sales under the 
contract during the preceding 3-month period, to include any partial 
month. The dollar value of a sale is the price paid by the schedule user 
for products and services on a schedule contract delivery order, as 
recorded by the Contractor. The reported contract sales value must 
include the industrial funding fee (see Clause 552.238-77). The 
Contractor must prepare and submit a separate report for each National 
Stock Number (NSN), Special Item Number (SIN), or subitem, unless 
otherwise specified, on GSA Form 72A.
    (b) The Contractor must convert the total value of any 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 must use the issue of the Treasury 
report in effect on the last day of the contract quarter. The report is 
available from: Department of the Treasury, Financial Management 
Service, International Funds Branch, 3700 East-West Highway, PGCII, Room 
5A19, Hyattsville, MD 20782, Telephone: (202) 874-7994, Internet: http:/
/www.ustreas.gov/treasury/bureaus/finman/intn.html.
    (c) The report is due in the office specified below or specified at 
the time of award 30 days following the completion of the reporting 
period. The Contractor must provide a close-out report within 120 days 
after the expiration date of the contract. This close-out report must 
cover all sales not shown in the final quarterly report and reconcile 
all errors and credits. If the Contractor reported all contract sales 
and reconciled all errors and credits on the final quarterly report, 
then show zero sales in the close-out report.
    (d) The Government reserves the right to inspect without further 
notice, such records of the Contractor as pertain to sales under this 
contract. Willful failure or refusal to furnish the required reports, or 
falsification thereof, constitutes sufficient cause for terminating the 
contract for cause under the termination provisions of this contract.
    (e) The report shall be forwarded to the following address:

General Services Administration
 _______________________________________________________________________
________________________________________________________________________
________________________________________________________________________
________________________________________________________________________

                             (End of Clause)

                         Alternate I (May 1997).

    If it is necessary to identify the official responsible for 
preparing the report, the Contracting Officer may add a paragraph 
substantially the same as the following paragraph (f) to the basic 
clause:

    (f) Within ______ days of contract award, the Contractor shall 
provide to the Contracting Officer, the name, title, address, and 
telephone number of the individual who will be responsible for the 
report.

                        Alternate II (May 1989).

    When the clause is used in IRMS schedule contracts, substitute a 
paragraph substantially the same as the following paragraph (a) for 
paragraph (a) of the basic clause:
    (a) The Contractor shall furnish quarterly the dollar value (rounded 
to the nearest whole dollar) of orders received or invoices issued 
during the preceding 3-month period to include any partial month. A 
separate report for each Special Item Number (SIN) shall be prepared and 
submitted, unless otherwise specified, on GSA Form 72.
[54 FR 26558, June 23, 1989, as amended at 60 FR 19361, Apr. 18, 1995; 
62 FR 38476, July 18, 1997]

[[Page 452]]



552.238-74  Submission and distribution of authorized FSS schedule pricelists.

    As prescribed in 538.203-71(c), insert the following clause:

 Submission and Distribution of Authorized FSS Schedule Pricelists (FEB 
                                  1996)

    (a) Definition. For the purposes of this clause, the Mailing List is 
[Contracting officer shall insert either: ``the list of Federal 
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 Authorized 
FSS Schedule Pricelist to the Contractor with the notification of 
contract award. The Contractor shall not print or distribute the 
pricelist without written approval from the Contracting Officer. NOTE: 
Approval by the Contracting Officer shall not absolve the contractor 
from responsibility for the accuracy of the pricelist.

    (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 addressees 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)
[58 FR 54524, Oct. 22, 1993, as amended at 61 FR 6172, Feb. 16, 1996]



552.238-75  Identification of Energy-Efficient Office Equipment and Supplies Containing Recovered Materials or Other Environmental Attributes.

    As prescribed in 538.203-71(d), insert the following clause:

    Identification of Energy-Efficient Office Equipment and Supplies 
 Containing Recovered Materials or Other Environmental Attributes (Sept 
                                  1994)

    (a) Definitions. ``Energy-efficient office equipment,'' as used in 
this clause, means office equipment that, in representative use, 
provides equivalent or better performance and value to users, but uses 
significantly less energy than most functionally equivalent models.
    ``Recovered materials,'' as used in this clause, means waste 
material and by-products which have been recovered or diverted from 
solid waste, but such term does not include those materials and by-
products generated from, and commonly reused, within an original 
manufacturing process (42 U.S.C. 6903(19)). For paper, it also includes 
postconsumer materials, and manufacturing and certain other wastes. (42 
U.S.C. 6962(h)).
    ``Remanufactured products,'' as used in this clause, means equipment 
or parts that have been factory remanufactured or rebuilt to meet new 
equipment or part performance specifications and have had no use 
subsequent to their remanufacture.
    (b) The offeror shall identify in its offer and include in any 
commercial catalogs and pricelists and any resultant Government catalogs 
or pricelists submitted to the Contracting Officer, energy-efficient 
office equipment and supplies that contain recovered material, 
remanufactured products, or other environmental attributes. Examples of 
energy-efficient office equipment are microcomputers and associated 
equipment that meet the requirements of the Environmental Protection 
Agency's (EPA's) Energy Star Computers Program. Supplies that contain 
recovered materials and other environmental attributes include, but are 
not limited to, products identified in EPA procurement guidelines (40 
CFR subchapter I) and products that are either degradable, ozone safe, 
recyclable, contain low volatile organic content compounds, contribute 
to source reduction, or otherwise are designed or manufactured to 
achieve environmental improvement. For example, an offeror can identify 
products that are safe or safer alternatives for more toxic or hazardous 
products and products that can be substituted for ones manufactured with 
toxic or hazardous materials. Such supplies shall satisfy the guidance 
contained in 16 CFR part 260, Guides for the Use of Environmental 
Marketing Claims.

[[Page 453]]

    (c) An offeror, in identifying an item with an environmental 
attribute, shall possess evidence or rely upon a reasonable basis to 
substantiate the claim (see 16 CFR 260.5). 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., EPA's 
Energy Star Computers 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)
[59 FR 63260, Dec. 8, 1994]



552.238-76  Price reductions.

    As prescribed in 538.203-71(e), insert the following clause:

                       Price Reductions (Oct 1994)

    (a) Before award of a contract, the Contracting Officer and the 
Offeror will agree upon (1) The customer (or category of customers) 
which will be the basis of award, and (2) the Government's price or 
discount relationship to the identified customer (or category of 
customers). This relationship shall be maintained throughout the 
contract period. Any change in the Contractor's commercial pricing or 
discount arrangement applicable to the identified customer (or category 
of customers) which disturbs this relationship shall constitute a price 
reduction.
    (b) During the contract period, the Contractor shall report to the 
Contracting Officer all price reductions to the customer (or category of 
customers) that was the basis of award. The Contractor's report shall 
include an explanation of the conditions under which the reductions were 
made.
    (c) (1) A price reduction shall apply to purchases under this 
contract if, after the date negotiations conclude, the Contractor--
    (i) Revises the commercial catalog, pricelist, schedule or other 
document upon which contract award was predicated to reduce prices;
    (ii) Grants more favorable discounts or terms and conditions than 
those contained in the commercial catalog, pricelist, schedule or other 
documents upon which contract award was predicated; or
    (iii) Grants special discounts to the customer (or category of 
customers) that was the basis of award, and the change disturbs the 
price/discount relationship of the Government to the customer (or 
category of customers) that was the basis of award.
    (2) The Contractor shall offer the price reduction to the Government 
with the same effective date, and for the same time period, as extended 
to the commercial customer (or category of customers).
    (d) There shall be no price reduction for sales--
    (1) To commercial customers under firm, fixed-price definite 
quantity contracts with specified delivery in excess of the maximum 
order limitation specified in this contract;
    (2) To Federal agencies; or
    (3) Caused by an error in quotation or billing, provided adequate 
documentation is furnished by the Contractor to the Contracting Officer.
    (e) The Contractor may offer the Contracting Officer a voluntary 
Governmentwide price reduction at any time during the contract period.
    (f) The Contractor shall notify the Contracting Officer of any price 
reduction subject to this clause as soon as possible, but not later than 
15 calendar days after its effective date.
    (g) The contract will be modified to reflect any price reduction 
which becomes applicable in accordance with this clause.

                             (End of Clause)

[59 FR 52452, Oct. 18, 1994]



552.238-77  Industrial funding fee.

    As prescribed in 538.203-71(f), insert the following clause:

                    Industrial Funding Fee (MAY 1997)

    (a) The Contractor must pay the Federal Supply Service, GSA, an 
Industrial Funding Fee (IFF), in U.S. dollars, at the end of each 
contract quarter. The Contractor must remit the IFF at the same time the 
GSA Form 72A, Contractor's Report of Sales, is submitted under clause 
552.238-72, Contractor's Report of Sales. The IFF equals 
________________* of total sales reported on GSA Form 72A. The IFF 
reimburses the GSA Federal Supply Service for the costs of operating the 
Federal Supply Schedules Program and recoups its operating costs from 
ordering activities. Offerors should include the IFF in the prices 
submitted with their offer. The fee is included in the award price(s) 
and reflected in the total amount charged to ordering activities.
    (b) The Contractor must remit any monies due as a result of the 
close-out report required by clause 552.238-72 at the time the close-out 
report is submitted to GSA.
    (c) The IFF amount due must be paid by check or, electronic funds 
transfer through the Automated Clearing House (ACH), to the ``General 
Services Administration.'' If the

[[Page 454]]

payment involves multiple special item numbers or contracts, the 
Contractor may consolidate the IFFs into one payment. To ensure that the 
payment is credited properly, the Contractor should identify the check 
or electronic transmission as an ``Industrial Funding Fee'' and include 
the following information: contract number(s); report amount(s); and 
report period(s). If the Contractor makes payment by check, provide this 
information on either the check, check stub, or remittance material. The 
GSA Form 72A is not remittance material.
    (1) If the IFF payment is made by check, it shall be forwarded to 
the following address:

                     General Services Administration

 _______________________________________________________________________
________________________________________________________________________
________________________________________________________________________
    (2) If the IFF payment is made by electronic funds transfer through 
ACH, the Contractor must call GSA, Financial Information Control Branch, 
Receivables, Collections and Sales Section (6BCDR) at (contracting 
officer to insert phone number) to make arrangements.
    (d) If the full amount of the IFF is not paid within 30 calendar 
days after the end of the applicable reporting period, it shall 
constitute a contract debt to the United States Government under the 
terms of FAR 32.6. The Government may exercise all rights under the Debt 
Collection Act of 1982, including withholding or setting off payments 
and interest on the debt (see FAR 52.232-17, Interest).
    (e) Failure to submit sales reports, falsification of sales reports, 
and/or failure to pay the IFF in a timely manner may result in 
termination or cancellation of this contract. Willful failure or refusal 
to furnish the required reports, falsification of sales reports, or 
failure to make timely payment of the IFF constitutes sufficient cause 
for terminating the contract for cause under the termination provisions 
of this contract.

                             (End of Clause)

    *The percentage amount of the fee to be inserted in the above clause 
shall be determined and provided to contracting officers by the 
Commissioner, Federal Supply Service, or a designee.
[60 FR 19362, Apr. 18, 1995; 60 FR 45528, Aug. 31, 1995, as amended at 
62 FR 38476, July 18, 1997]



Sec. 552.242-70  Status report of orders and shipments.

    As prescribed in 542.1107, insert the following clause:

            Status Report of Orders and Shipments (Apr 1992)

    (a) The contractor shall furnish to the Administrative Contracting 
Officer (ACO) a report covering orders received and shipments made 
during each calendar month of contract performance. The information 
required by the Government shall be reported on GSA Form 1678, Status 
Report of Orders and Shipments, in accordance with instruction on the 
form. The information required by the GSA Form 1678 may also be 
submitted in an automated printout form if authorized by the ACO. 
Alternatively, the required information may be reported by electronic 
data interchange using ANSI standards. For further information, contact 
GSA, Contract Administration Division [Contracting Officer insert 
appropriate telephone number of FQC]. Reports shall be forwarded to the 
ACO no later than the seventh workday of the succeeding month.
    (b) An initial supply of GSA Form 1678 will be forwarded to the 
Contractor with the contract. Additional copies of the form, if needed, 
may be obtained from the ACO, or reproduced by the Contractor.

(End of Clause)
[57 FR 26609, June 15, 1992]



552.243-70  Pricing of adjustments.

    As prescribed in 543.205(a), insert the following clause:

                    Pricing of Adjustments (Apr 1989)

    When costs are a factor in any determination of a contract price 
adjustment, such costs shall be in accordance with the contract cost 
principles and procedures in Part 31 of the Federal Acquisition 
Regulation (48 CFR Part 31) in effect on the date of this contract.

                             (End of Clause)



552.243-71  Equitable adjustments.

    As prescribed in 543.205(b), insert the following clause in 
solicitations and contracts for (a) dismantling, demolition, or removal 
of improvements; and (b) construction, when a fixed-price contract is 
contemplated and the contract amount is expected to exceed the small 
purchase limitation:

                    Equitable Adjustments (Apr 1984)

    (a) The provisions of the ``Changes'' clause prescribed by FAR 
52.243-4 are supplemented as follows:
    (1) Upon written request, the Contractor shall submit a proposal, in 
accordance with the requirements and limitations set forth in the 
``Equitable Adjustments'' clause, for

[[Page 455]]

work involving contemplated changes covered by the request. The proposal 
shall be submitted within the time limit indicated in the request or any 
extension of such time limit as may be subsequently granted. The 
Contractor's written statement of the monetary extent of a claim for 
equitable adjustment shall be submitted in the following form:
    (i) Proposals totaling $5,000 or less shall be submitted in the form 
of a lump sum proposal with supporting information to clearly relate 
elements of cost with specific items of work involved to the 
satisfaction of the Contracting Officer, or his/her authorized 
representative.
    (ii) For proposals in excess of $5,000, the claim for equitable 
adjustment shall be submitted in the form of a lump sum proposal 
supported with an itemized breakdown of all increases and decreases in 
the contract in at least the following detail:

                              Direct Costs

Material quantities by trades and unit costs
    (Manufacturing burden associated with material fabrication performed 
will be considered to be part of the material costs of the fabricated 
item delivered to the job site)
Labor breakdown by trades and unit costs
    (Identified with specific item of material to be placed or operation 
to be performed)
Construction equipment exclusively necessary for the change
Costs of preparation and/or revision to shop drawings resulting from the 
          change
Workmen's Compensation and Public Liability Insurance
Employment taxes under FICA and FUTA
Bond Costs--when size of change warrants revision

                     Overhead, Profit and Commission

    (2) The allowable overhead shall be determined in accordance with 
the contract cost principles and procedures in Part 31 of the Federal 
Acquisition Regulation (48 CFR Part 31) in effect on the date of this 
contract. The percentages for profit and commission shall be negotiated 
and may vary according to the nature, extent and complexity of the work 
involved, but in no case shall exceed the following unless the 
Contractor demonstrates entitlement to a higher percentage:

                                                                        
------------------------------------------------------------------------
                                      Overhead        Profit  Commission
------------------------------------------------------------------------
To Contractor on work performed  ..................  .......        10% 
 by other than his own forces.                                          
To first tier subcontractor on   ..................  .......        10% 
 work performed by his                                                  
 subcontractors.                                                        
To Contractor and/or the         To be Negotiated..      10%  ..........
 subcontractors for that                                                
 portion of the work performed                                          
 with their respective forces.                                          
------------------------------------------------------------------------

    Not more than four percentages will be allowed regardless of the 
number of tier subcontractors. The Contractor shall not be allowed a 
commission on the commission received by a first tier subcontractor. 
Equitable adjustments for deleted work shall include credits for 
overhead, profit and commission. On proposals covering both increases 
and decreases in the amount of the contract, the application of overhead 
and profit shall be on the net change in direct costs for the Contractor 
or subcontractor performing the work.
    (3) The Contractor shall submit with the proposal his request for 
time extension (if any), and shall include sufficient information and 
dates to demonstrate whether and to what extent the change will delay 
the contract in its entirety.
    (4) In considering a proposal, the Government shall make check 
estimates in detail, utilizing unit prices where specified or agreed 
upon, with a view to arriving at an equitable adjustment.
    (5) After receipt of a proposal the Contracting Officer shall act 
thereon, within 30 days; provided, however, that when the necessity to 
proceed with a change does not allow time properly to check a proposal 
or in the event of failure to reach an agreement on a proposal, the 
Government may order the Contractor to proceed on the basis of price to 
be determined at the earliest practicable date. Such price shall not be 
more than the increase or less than the decrease proposed.
    (6) If a mutually acceptable agreement cannot be reached, the 
Contracting Officer may determine the price unilaterally.
    (b) The provisions of the ``Differing Site Conditions'' clause 
prescribed by FAR 52.236-2 are supplemented as follows: The Contractor 
shall submit all claims for equitable adjustment in accordance with, and 
subject to the requirements and limitations set out in paragraph (a) of 
this ``Equitable Adjustments'' clause.

                             (End of Clause)



552.243-72  Modifications (Multiple Award Schedule).

    As prescribed in 48 CFR 543.205(c), insert the following clause:

[[Page 456]]

           Modifications (Multiple Award Schedule) (AUG 1997)

    (a) General. The Contractor may request a contract modification by 
submitting a request to the Contracting Officer for approval, except as 
noted in paragraph (d) of this clause. At a minimum, every request shall 
describe the proposed change(s) and provide the rationale for the 
requested change(s).
    (b) Types of Modifications.
    (1) Additional items/additional SIN's. When requesting additions, 
the following information must be submitted:
    (i) Information requested in paragraphs (1) and (2) of the 
Commercial Sales Practice Format to add SIN's.
    (ii) Discount information for the new item(s) or new SIN(s). 
Specifically, submit the information requested in paragraphs 3 through 5 
as applicable of the Commercial Sales Practice Format. If this 
information is the same as the initial award, a statement to that effect 
may be submitted instead.
    (iii) Information about the new item(s) or new SIN(s) as described 
in 552.212-70, Preparation of Offer (Multiple Award Schedule) is 
required.
    (iv) Delivery time(s) for the new item(s) or the item(s) under the 
new SIN(s) must be submitted in accordance with 552.211-78, Commercial 
Delivery Schedule (Multiple Award Schedules).
    (v) Production point(s) for the new item(s) or the item(s) under the 
new SIN(s) must be submitted if required by 52.215-20, Place of 
Performance.
    (vi) Hazardous Material information (if applicable) must be 
submitted as required by 52.223-3 (ALT I), Hazardous Material 
Identification and Material Safety Data; and 552.223-71, Hazardous 
Material Information; and as requested by the Separate Charge for 
Performance Oriented Packaging clause of this contract, if applicable.
    (vii) Recovered Material estimate(s) and certification (if 
applicable) must be submitted as required by 52.223-8 (or 52.223-8 (ALT 
I) or 52.223-8 (ALT II), Estimate of Percentage of Recovered Material 
for Designated Items to be used in the Performance of the Contract; and 
52.223-9, Certification of Recovered Material Content for EPA Designated 
Items used in Performance of the Contract.
    (viii) Any information requested by 52.212-3(f), Offerors 
Representations and Certifications--Commercial Items, that may be 
necessary to assure compliance with 552.225-9, Trade Agreements Act.
    (2) Deletions. The Contractors shall provide an explanation for the 
deletion. The Government reserves the right to reject any subsequent 
offer of the same item or a substantially equal item at a higher price 
during the same contract period, if the contracting officer finds the 
higher price to be unreasonable when compared with the deleted item.
    (3) Price Reduction. The Contractor shall indicate whether the price 
reduction falls under the item (i), (ii), or (iii) of subparagraph 
(c)(1) of the Price Reduction clause at 552.238-76. If the Price 
reduction falls under item (i), the Contractor shall submit a copy of 
the dated commercial price list. If the price reduction falls under item 
(ii) or (iii), the Contractor shall submit a copy of the applicable 
price list(s), bulletins or letters or customer agreements which outline 
the effective date, duration, terms and conditions of the price 
reduction.
    (c) Effective dates. The effective date of any modification is the 
date specified in the modification, except as otherwise provided in the 
Price Reduction clause at 552.238-76.
    (d) Electronic file updates. The Contractor shall update electronic 
file submissions to reflect all modifications. Except for price 
reductions and corrections, the Contractor shall obtain the contracting 
officer's approval before transmitting changes. Contract modifications 
will not be made effective until updates to electronic files are 
received. Price reductions and correction may be transmitted without 
prior approval. However, the contracting officer shall be notified as 
set forth in the Price Reduction clause at 552.238-76.
    (e) Amendments to paper Federal Supply Schedule Price Lists. The 
Contractor shall distribute a supplemental paper Federal Supply Schedule 
Price List reflecting accepted changes within 15 days after the 
effective date of the modification. At a minimum, distribution shall be 
made to these ordering activities that previously received the basic 
document. In addition, two copies of the supplemental price list shall 
be submitted to the contracting officer, and one copy shall be submitted 
to the FSS Schedule Information Center.

                             (End of Clause)

[61 FR 6172, Feb. 16, 1996; 61 FR 10846, Mar. 15, 1996, as amended at 62 
FR 44525, Aug. 21, 1997]



552.246-17  Warranty of supplies of a noncomplex nature.

    As prescribed in 546.710(a)(1), insert the following clause:

 Warranty of Supplies of a Noncomplex Nature (Dec 1990) (Deviation FAR 
                               52.246-17)

    (a) Definitions. ``Acceptance,'' as used in this clause, means the 
act of an authorized representative of the Government by which the 
Government assumes for itself, or as an agent of another, ownership of 
existing supplies, or approves specific services as partial or complete 
performance of the contract. ``Correction,'' as used in this clause, 
means

[[Page 457]]

the elimination of a defect. ``Supplies,'' as used in this clause, means 
the end item furnished by the Contractor and related services required 
under the contract. The word does not include ``data.''
    (b) Contractor's obligations.
    (1) Notwithstanding inspection and acceptance by the Government of 
supplies furnished under this contract, or any condition of this 
contract concerning the conclusiveness thereof, the Contractor warrants 
that for*
    (i) All supplies furnished under this contract will be free from 
defects in material or workmanship and will conform with the 
requirements of this contract; and
    (ii) The preservation, packaging, packing, and marking, and the 
preparation for, and method of, shipment of such supplies will conform 
with the requirements of this contract.
    (2) When return, correction, or replacement is required, the 
Contractor shall be responsible for all costs attendant with no return, 
correction or replacement of the nonconforming supplies. Any removal in 
connection with the above shall be done by the Contractor at its 
expense. However, the Contractor's liability for the transportation 
charges shall not exceed an amount equal to the cost of transportation 
by the usual commercial method of shipment between the place of delivery 
specified in the contract and the Contractor's plant, and return.
    (3) Any supplies or parts thereof, corrected or furnished in 
replacement under this clause, shall also be subject to the terms of 
this clause to the same extent as supplies initially delivered. The 
warranty, with respect to supplies or parts thereof, shall be equal in 
duration to that in paragraph (b)(1) of this clause and shall run from 
the date of delivery of the corrected or replaced supplies.
    (4) All implied warranties of merchantability and ``fitness for a 
particular purpose'' are excluded from any obligation contained in this 
contract.
    (c) Remedies available to the Government.
    (1) The Contracting Officer shall give written notice to the 
Contractor of any breach of warranties in paragraph (b)(1) of this 
clause within **. This notice shall contain information concerning the 
deficiencies found, the location of the nonconforming supplies, and the 
quantity involved.
    (2) Within a reasonable time after the notice, the Contracting 
Officer may either--
    (i) Require, by written notice, the prompt correction or replacement 
of any supplies or parts thereof (including preservation, packaging, 
packing, and marking) that do not conform with the requirements of this 
contract within the meaning of paragraph (b)(1) of this clause; or
    (ii) Retain such supplies and reduce the contract price by an amount 
equitable under the circumstances. When the nature of the defect in the 
nonconforming item is such that the defect affects an entire batch or 
lot of material, then the equitable price adjustment shall apply to the 
entire batch or lot of material from which the nonconforming item was 
taken.
    (3)(i) If the contract provides for inspection of supplies by 
sampling procedures, conformance of supplies or components subject to 
warranty action shall be determined by the applicable sampling 
procedures in the contract. The Contracting Officer--
    (A) May, for sampling purposes, group any supplies delivered under 
this contract;
    (B) Shall require the size of the sample to be that required by 
sampling procedures specified in the contract for the quantity of 
supplies on which warranty action is proposed;
    (C) May project warranty sampling results over supplies in the same 
shipment or other supplies contained in other shipments even though all 
of such supplies are not present at the point of reinspection; provided, 
that the supplies remaining are reasonably representative of the 
quantity on which warranty action is proposed; and
    (D) Need not use the same lot size as on original inspection or 
reconstitute the original inspection lots.
    (ii) Within a reasonable time after notice of any breach of the 
warranties specified in paragraph (b)(1) of this clause, the Contracting 
Officer may exercise one or more of the following options:
    (A) Require an equitable adjustment in the contract price for any 
group of supplies.
    (B) Screen the supplies grouped for warranty action under this 
clause at the Contractor's expense and return all nonconforming supplies 
to the Contractor for correction or replacement.
    (C) Require the Contractor to screen the supplies at locations 
designated by the Government within the continental United States and to 
correct or replace all nonconforming supplies.
    (D) Return the supplies grouped for warranty action under this 
clause to the Contractor (irrespective of the f.o.b. point or the point 
of acceptance) for screening and correction or replacement. All costs 
incurred by the Government in returning the nonconforming supplies, 
including costs to the freight carrier resulting from the Contractor's 
refusal to accept their return, shall be for the Contractor's account.
    (4)(i) The Contracting Officer may, by contract or otherwise, 
correct or replace the nonconforming supplies with similar supplies from 
another source and charge to the Contractor the cost occasioned to the 
Government thereby if the Contractor--
    (A) Fails to make redelivery of the corrected or replaced supplies 
within the time established for their return; or

[[Page 458]]

    (B) Fails either to accept return of the nonconforming supplies or 
fails to make progress after their return to correct or replace them so 
as to endanger performance of the delivery schedule, and in either of 
these circumstances does not cure failure within a period of 10 days (or 
such longer period as the Contracting Office may authorize in writing) 
after receipt of notice from the Contracting Officer specifying such 
failure.
    (ii) Instead of correction or replacement by the Government, the 
Contracting Officer may require an equitable adjustment of the contract 
price for all nonconforming supplies, including batch or lot materials 
which either have been consumed or other disposition has been made. In 
addition, if the Contractor fails to furnish timely disposition 
instructions, the Contracting Officer may return the supplies for 
screening and correction or replacement under subparagraph (c)(3)(ii)(D) 
above; store the nonconforming supplies for the Contractor's account; 
sell the nonconforming supplies to the highest bidder on the open market 
and apply the proceeds against the accumulated storage and other costs, 
including the cost of the sale; or otherwise dispose of the 
nonconforming supplies for the Contractor's account in a reasonable 
manner. The Government is entitled to reimbursement from the Contractor, 
or from the proceeds of such disposal, for the reasonable expenses of 
the care and disposition of the nonconforming supplies, as well as for 
excess costs incurred or to be incurred.
    (5) The rights and remedies of the Government provided in this 
clause are in addition to and do not limit any rights afforded to the 
Government by any other clause of this contract.
    (6) Unless otherwise provided, this warranty is applicable both 
within and outside the continental limits of the United States.
    (7) In addition to other marking requirements of this contract, the 
Contractor shall stamp or mark the supplies delivered or otherwise 
furnish notice with the supplies of the existence of the warranty. The 
marking should briefly include (i) a statement that the warranty exists, 
(ii) the substance of the warranty, (iii) its duration, and (iv) whom to 
notify if the supplies are found to be defective.

                             (End of Clause)

    * Contracting Officer shall state the specific period of time after 
delivery or the specified event whose occurrence will terminate the 
warranty period; e.g., the number of miles or hours of use, or 
combination of any applicable event or periods of time.
    ** Contracting Officer shall insert specific period of time; e.g., 
``45 days from the last delivery under contract,'' or ``45 days after 
discovery of the defect.'' The number of days specified shall be no less 
than 30.

                         Alternate I (Dec 1990)

    As prescribed in 546.710(a)(2), substitute the following for 
paragraph (b)(1) of the basic clause and delete paragraph (b)(4) of the 
basic clause.
    (1) Notwithstanding inspection and acceptance by the Government of 
supplies furnished under this contract, or any condition of this 
contract concerning the conclusiveness thereof, the Contractor warrants 
that for * all supplies furnished--
    (i) Are of a quality to pass without objection in the trade under 
the contract description;
    (ii) Are fit for the ordinary purposes for which the supplies are 
used;
    (iii) Are within the variations permitted by the contract, and are 
of an even kind, quality, and quantity within each unit and among all 
units;
    (iv) Are adequately contained, packaged, and marked as the contract 
may require; and
    (v) Conform to the promises or affirmations of fact made on the 
container.

                         Alternate II (Dec 1990)

    As prescribed in 546.710(a)(3), substitute the following paragraph 
for paragraph (b)(1) of the basic clause:
    (1) Notwithstanding inspection and acceptance by the Government of 
supplies furnished under this contract, or any condition of this 
contract concerning the conclusiveness thereof, the Contractor warrants 
that for * all supplies furnished--
    (i) Conform to the specifications except that in the case of solvent 
systems, the viscosity may exceed the specified maximum by 10 Kreb 
Units, unless otherwise specified elsewhere in this contract; and
    (ii) Are suitable for their intended purpose as stated in this 
contract.

                        Alternate III (Dec 1990)

    As prescribed in 546.710(a)(4), substitute the following for 
paragraph (b)(1) of the basic clause, redesignate paragraph (c) of the 
basic clause as paragraph (d), and add the following as paragraph (c) in 
the basic clause:
    (1) Notwithstanding inspection and acceptance by the Government of 
supplies furnished under this contract, or any condition of this 
contract concerning the conclusiveness thereof, the Contractor warrants 
that for   *  , beginning with the first day of the first full month 
following the month of manufacture marked on the container, all supplies 
furnished retain their original characteristics to the extent that the 
supplies remain suitable for the intended use as stated in this contract 
(i) under actual application conditions or (ii) when tested in 
accordance with requirements stated elsewhere in this contract.
    (c) Government surveillance and testing.

[[Page 459]]

    (1) During this period, surveillance will be maintained on supplies 
warehoused in Government facilities; and the supplies will be tested 
periodically to determine their suitability for intended use. Sampling 
for surveillance testing will be in accordance with Military Standard 
No. 105, and such testing will be made after NORMAL MIXING, STIRRING, OR 
SHAKING, in accordance with directions either furnished with the 
supplies or as shown in the applicable specifications.
    (2) Surveillance testing will be based on storage stability 
requirements set forth in the contract specification, or purchase 
description on the basis of salient characteristics (e.g., viscosity or 
sag flow, curing time, strip adhesion or tensile shear, etc.) 
established by GSA as appropriate to determine suitability for intended 
use. In the case of brand name items not covered by detailed purchase 
descriptions, surveillance testing may be based on salient 
characteristics included in the manufacturer's data sheets. If storage 
stability requirements showing allowable variations are not included in 
applicable specifications or elsewhere in the contract, material will be 
considered suitable for intended use if the salient characteristics vary 
not more than 20 percent from the originally specified values (i.e., 
those applicable to acceptance testing of the supplies) for noncritical 
end-use items, and not more than 10 percent for critical end-use items.
[56 FR 1741, Jan. 17, 1991]



552.246-70  Source inspection by quality approved manufacturer.

    As prescribed in 546.302-70, insert the following clause:

     Source Inspection by Quality Approved Manufacturer (Mar. 1994)

    (a) Inspection system and inspection facilities.
    (1) The inspection system maintained by the Contractor under the 
Inspection of Supplies--Fixed Price clause ((FAR) 48 CFR 52.246-2) of 
this contract shall be maintained throughout the contract period and 
shall comply with all requirements of editions in effect on the date of 
the solicitation of either Federal Standard 368 or the International 
Organization for Standardization (ISO) Standard 9001 (ANSI/ASQC Q 91) 
(Quality Systems--Model for Quality Assurance in Design/Development, 
Production, Installation and Servicing), or ISO Standard 9002 (ANSI/ASQC 
Q 92) (Quality Systems--Model for Quality Assurance in Production and 
Installation). The ISO 9000 family of standards is a set of worldwide 
standards used to document, implement and demonstrate quality assurance 
systems. When using the ISO option the Contractor's quality system must 
be registered by a third party registrar accredited by either the 
Registrar Accreditation Board (RAB) or an organization recognized as 
equivalent. A written description of the inspection system shall be made 
available to the Government before contract award. The Contractor shall 
immediately notify the Contracting Officer and the designated GSA 
quality assurance office of any changes made in the inspection system 
during the contract period. As used herein, the term ``inspection 
system'' means the Contractor's own facility or any other facility 
acceptable to the Government that will be used to perform inspections or 
tests of materials and components before incorporation into end articles 
and for inspection of such end articles before shipment. When the 
manufacturing plant is located outside of the United States, the 
Contractor shall arrange delivery of the items from a plant or warehouse 
located in the United States (including Puerto Rico and the Virgin 
Islands) equipped to perform all inspections and tests required by the 
contract or specifications to evidence conformance therewith, or shall 
arrange with a testing laboratory or other facility in the United 
States, acceptable to the Government, to perform the required 
inspections and tests.
    (2) In addition to the requirements in Federal Standard 368, ISO 
9001 or ISO 9002 records shall include the date when inspection and 
testing were performed. These records shall be available for (i) 3 years 
after final payment; or (ii) 4 years from the end of the Contractor's 
fiscal year in which the record was created, whichever period expires 
first.
    (3) Offerors are required to specify, in the space provided 
elsewhere in this solicitation, the name and address of each 
manufacturing plant or other facility where supplies will be available 
for inspection, indicating the item number(s) to which each applies.
    (4) Within 10 calendar days after receipt of the written notice of 
award, the Contractor shall provide the Administrative Contracting 
Officer with the name of the individual and an alternate that will be 
responsible for inspecting each shipment under this contract.
    (b) Inspection and receiving reports.
    (1) For each shipment released, one of the officials named by the 
Contractor under paragraph (a)(4) above shall sign a Quality Approved 
Manufacturer Certificate certifying that supplies have been inspected 
and found to comply with contract requirements.
    The certification shall read as follows:
    ``I certify that all items in this shipment have been listed herein, 
and have been inspected and found to comply with all requirements of the 
contract.''

                    Signature of Certifying Official

    (i) For shipments made to military facilities, the Contractor shall 
prepare and distribute the DD Form 250, Material Inspection and 
Receiving Report, or computer

[[Page 460]]

formatted equivalent of the form not later than the close of business 
the workday following shipment. The certification above shall be placed 
in block 16 on this form. The Contractor will be provided a supply of 
the DD Form 250 with complete instructions for preparation and 
distribution.
    (ii) For shipments made to civilian facilities only, the Contractor 
shall prepare and distribute not later than the close of business the 
workday following shipment a certification of inspection and conformance 
for the identified items, in accordance with instructions furnished at 
the time of award. The Contractor may furnish the requisite information 
on the DD Form 250 or computer formatted equivalent, company letterhead, 
or invoice document.
    (c) Inspection by Government personnel.
    (1) Although the Government will normally rely upon the Contractor's 
certification as to the quality of supplies shipped, it reserves the 
right under the Inspection of Supplies--Fixed Price clause to inspect 
and test all supplies called for by this contract, before acceptance, at 
all times and places, including the point of manufacture. When the 
Government notifies the Contractor of its intent to inspect supplies 
before shipment, the Contractor shall notify or arrange for 
subcontractors to notify the designated GSA quality assurance office 7 
workdays before the date when supplies will be ready for inspection. 
Shipment shall not be made until inspection by the Government is 
completed and shipment is authorized by the Government.
    (2) Government inspection responsibility will be assigned to the GSA 
quality assurance office which has jurisdiction over the State in which 
the Contractor's or subcontractor's plant or other designated point for 
inspection is located.
    (3) During the contract period, a Government representative may 
periodically select samples of supplies produced under this contract for 
Government verification inspection and testing. Samples sent to a 
Government testing facility will be disposed of as follows: Samples from 
an accepted lot, not damaged in the testing process, will be returned 
promptly to the Contractor after completion of tests. Samples damaged in 
the testing process will be disposed of as requested by the Contractor. 
Samples from a rejected lot will be returned to the Contractor or 
disposed of in a time and manner agreeable to both the Contractor and 
the Government.
    (d) Quality deficiencies.
    (1) Notwithstanding any other clause of this contract concerning the 
conclusiveness of acceptance by the Government, any supplies or 
production lots shipped under this contract found to be defective in 
material or workmanship, or otherwise not in conformity with the 
requirements of this contract within a period of   *   months after 
acceptance shall, at the Government's option, be replaced, repaired or 
otherwise corrected by the Contractor at no cost to the Government 
within 30 calendar days (or such longer period as the Government may 
authorize in writing) after receipt of notice to replace or correct. The 
Contractor shall remove, at its expense, supplies rejected or required 
to be replaced, repaired or corrected. When the nature of the defect 
affects an entire batch or lot of supplies, and the Contracting Officer 
determines that correction can best be accomplished by retaining the 
nonconforming supplies and reducing the contract price by an amount 
equitable under the circumstances, then the equitable price adjustment 
shall apply to the entire batch or lot of supplies from which the 
nonconforming item was taken.
    (2) If supplies in process, shipped or awaiting shipment to fill 
Government orders are found not to comply with contract requirements, or 
if deficiencies in either plant quality or process controls are found, 
the Contractor may be issued a Quality Deficiency Notice (QDN). Upon 
receipt of a QDN, the Contractor shall take immediate corrective action 
and shall suspend shipment of the supplies covered by the QDN until such 
time as corrective action has been completed. The Contractor shall 
notify the GSA quality assurance office, within 5 workdays, of 
corrective action taken or to be taken to permit onsite verification by 
a Government representative. Shipments of nonconforming supplies will be 
returned at the Contractor's expense and may constitute cause for 
termination. Delays due to the issuance of a QDN do not constitute 
excusable delay under the Default clause. Failure to complete corrective 
action in a timely manner may result in termination of this contract.
    (3) This contract may be terminated for default if subsequent 
Government inspection discloses that plant quality or process controls 
are not being maintained, supplies which do not meet the requirements of 
the specification are being shipped, or there is failure to comply with 
any other requirement of this clause.
    (e) Additional cost for inspection and testing. The Contractor will 
be charged for any additional cost of inspection/testing or 
reinspecting/retesting supplies for the reasons stated in paragraph (e) 
of FAR 52.246-2, Inspection of Supplies--Fixed Price. When inspection or 
testing is performed by or under the direction of GSA, charges will be 
at the rate of $ ** per man-hour or fraction thereof if the inspection 
is at a GSA distribution center; $ ** per man-hour or fraction thereof, 
plus travel costs incurred, if the inspection is at any other location; 
and $ ** per man-hour or fraction thereof for laboratory testing, except 
that when a testing facility other than a GSA laboratory performs all or 
part of the

[[Page 461]]

required tests, the Contractor shall be assessed the actual cost 
incurred by the Government as a result of testing at such facility. When 
inspection is performed by or under the direction of any agency other 
than GSA, the charges indicated above may be used, or the agency may 
assess the actual cost of performing the inspection and testing.
    (f) Responsibility for rejected supplies. When the Contractor fails 
to remove or provide instructions for the removal of rejected supplies 
under paragraph (d) above, pursuant to the Contracting Officer's 
instructions, the Contractor shall be liable for all costs incurred by 
the Government in taking such measures as are expedient to avoid 
unnecessary loss to the Contractor. In addition to the remedies provided 
in FAR 52.246-2, supplies may be--
    (1) Stored for the Contractor's account;
    (2) Reshipped to the Contractor at its expense (any additional 
expense incurred by the Government or the freight carrier caused by the 
refusal of the Contractor to accept their return also shall be for the 
Contractor's account); or
    (3) Sold to the highest bidder on the open market and the proceeds 
applied against the accumulated storage and other costs, including the 
cost of the sale.
    (g) Subcontracting requirements. The Contractor shall insert in any 
subcontracts the inspection or testing provisions set forth in 
paragraphs (a) through (d) of this clause and the Inspection of 
Supplies--Fixed Price clause of this contract. The Contractor shall be 
responsible for compliance by any subcontractor with the provisions set 
forth in paragraphs (a) through (d) of this clause and the Inspection of 
Supplies--Fixed Price clause.

                             (End of Clause)

    * The Contracting Officer shall normally insert 12 months as the 
period during which defective or otherwise nonconforming supplies must 
be replaced. However, when the supplies being bought have a shelf life 
of less than 1 year, the shelf-life period should be used, or in the 
instance where a longer period may reasonably be expected to be 
available, the longer period should be used.
    ** The rates to be inserted are established by the Commissioner of 
the Federal Supply Service or a designee.
[56 FR 1742, Jan. 17, 1991, as amended at 58 FR 64694, Dec. 9, 1993; 59 
FR 15134, Mar. 31, 1994]



552.246-71  Final inspection and tests.

    As prescibed in 546.312, insert the following clause:

                  Final Inspection and Tests (May 1989)

    The Contractor shall give written notice to the Contracting Officer 
at least 10 calendar days before the date the work will be completed and 
ready for final inspection and tests. Final inspection and tests will 
begin within 10 calendar days after the date specified in the 
Contractor's notice unless the Contracting Officer determines that the 
work is not ready for final inspection and so informs the Contractor.

                             (End of Clause)



552.246-72  Source inspection by Government.

    As prescribed in 546.302-71, insert the following clause:

               Source Inspection by Government (Dec 1990)

    (a) Inspection by Government personnel.
    (1) Supplies to be furnished under this contract will be inspected 
at source by the Government before shipment from the manufacturing plant 
or other facility designated by the Contractor, unless the Contractor is 
otherwise notified in writing by the Contracting Officer or a designated 
representative. Notwithstanding the foregoing, the Government may 
perform any or all tests contained in the contract specifications at a 
Government facility without prior written notice by the Contracting 
Officer before release of the supplies for shipment. Samples sent to a 
Government testing facility will be disposed of as follows: Samples from 
an accepted lot, not damaged in the testing process, will be returned 
promptly to the Contractor after completion of tests. Samples damaged in 
the testing process will be disposed of as requested by the Contractor. 
Samples from a rejected lot will be returned to the Contractor or 
disposed of in a time and manner agreeable to both the Contractor and 
the Government.
    (2) Government inspection responsibility will be assigned to the GSA 
quality assurance office which has jurisdiction over the State in which 
the Contractor's or subcontractor's plant or other designated point for 
inspection is located. The Contractor shall notify or arrange for 
subcontractors to notify the designated GSA quality assurance office 7 
workdays before the date when supplies will be ready for inspection. 
Shipment shall not be made until after inspection by the Government is 
completed and shipment is authorized by the Government.
    (b) Inspection and receiving reports. For each shipment, the 
Contractor shall be responsible for preparation and distribution of 
inspection documents as follows: (1) DD Form 250, Material Inspection 
and Receiving Report, or computer formatted equivalent for deliveries to 
military agencies; or (2) GSA

[[Page 462]]

Form 308, Notice of Inspection for deliveries to GSA or other civilian 
agencies. When required, the Contractor will be furnished a supply of 
GSA Form 308 and/or DD Form 250, and complete instructions for their 
preparation and distribution.
    (c) Inspection facilities.
    (1) The inspection system required to be maintained by the 
Contractor in accordance with FAR 52.246-2, Inspection of Supplies--
Fixed Price, may be the Contractor's own facilities or any other 
facilities acceptable to the Government. These facilities shall be 
utilized to perform all inspections and tests of materials and 
components before incorporation into end articles, and for the 
inspection of such end articles before shipment. The Government reserves 
the right to evaluate the acceptability and effectiveness of the 
Contractor's inspection system before award and periodically during the 
contract period.
    (2) Offerors are required to specify, in the spaces provided 
elsewhere in the solicitation, the name and address of each 
manufacturing plant or other facility where supplies will be available 
for inspection, indicating the item number(s) to which each applies.
    (3) The Contractor shall deliver the items specified in this 
contract from a plant or warehouse located within the United States 
(including Puerto Rico and the Virgin Islands) that is equipped to 
perform all inspections and tests required by this contract or 
specifications to evidence conformance therewith, or shall arrange with 
a testing laboratory or other facility in the United States, acceptable 
to the Government, to perform the required inspections and tests.
    (d) Availability of records.
    (1) In addition to any other requirement of this contract, the 
Contractor shall maintain records showing the following information for 
each order received under the contract: (i) Order number; (ii) date 
order received by the Contractor; (iii) quantity ordered; (iv) date 
scheduled into production; (v) batch or lot number, if applicable; (vi) 
date inspected and/or tested; (vii) date available for shipment; (viii) 
date shipped or date service completed; and (ix) National Stock Number 
(NSN), or if none is provided in the contract, the applicable item 
number or other contractual identification.
    (2) These records should be maintained at the point of source 
inspection and shall be available to the Contracting Officer, or an 
authorized representative, for (i) 3 years after final payment; or (ii) 
4 years from the end of the Contractor's fiscal year in which the record 
was created, whichever period expires first.
    (e) Additional cost for inspection and testing. The Contractor will 
be charged for any additional cost for inspecting/testing or 
reinspection/retesting supplies for the reasons stated in paragraph (e) 
of FAR 52.246-2, Inspection of Supplies--Fixed Price. When inspection or 
testing is performed by or under the direction of GSA, charges will be 
at the rate of $ * per man-hour or fraction thereof if the inspection is 
at a GSA distribution center; $ * per man-hour or fraction thereof, plus 
travel costs incurred, if the inspection is at any other location; and $ 
* per man-hour or fraction thereof for laboratory testing, except that 
when a testing facility other than a GSA laboratory performs all or part 
of the required tests, the Contractor shall be assessed the actual cost 
incurred by the Government as a result of testing at such facility. When 
inspection is performed by or under the direction of any agency other 
than GSA, the charges indicated above may be used, or the agency may 
assess the actual cost of performing the inspection and testing.
    (f) Responsibility for rejected supplies. When the Contractor fails 
to remove or provide instructions for the removal of rejected supplies 
under FAR 52.246-2(h) pursuant to the Contracting Officer's 
instructions, the Contractor shall be liable for all costs incurred by 
the Government in taking such measures as are expedient to avoid 
unnecessary loss to the Contractor. In addition to the remedies provided 
in FAR 52.246-2, supplies may be--
    (1) Stored for the Contractor's account;
    (2) Reshipped to the Contractor at its expense (any additional 
expense incurred by the Government or the freight carrier caused by the 
refusal of the Contractor to accept their return also shall be for the 
Contractor's account); or
    (3) Sold to the highest bidder on the open market and the proceeds 
applied against the accumulated storage and other costs, including the 
cost of the sale.

                             (End of Clause)

    * The rates to be inserted are established by the Commissioner of 
the Federal Supply Service or a designee.
[56 FR 1744, Jan. 17, 1991]



552.246-73  Warranty--multiple award schedule.

    As prescribed in 546.710, insert the following clause:

              Warranty--Multiple Award Schedule (FEB 1996)

    Unless specified otherwise in this contract, the Contractor's 
standard commercial warranty as stated in the Contractor's commercial 
price list will apply to this contract.

                             (End of Clause)

[54 FR 26558, June 23, 1989, as amended at 61 FR 6173, Feb. 16, 1996]

[[Page 463]]



552.246-74  Warranty--International multiple award schedule.

    As prescribed in 546.710(c), insert the following clause:

       Warranty--International Multiple Award Schedule (May 1989)

    Unless specified otherwise in this contract, the Contractor's 
standard commercial warranty as stated in the commercial price list 
applies to this contract, except: (a) The Contractor shall provide, at a 
minimum, a warranty on all non-consumable parts for a period of 90 days 
from the date that the Government accepts the product; (b) parts and 
labor required under the warranty provisions shall be supplied free of 
charge; (c) transportation costs of returning the products to and from 
the repair facility, or the costs involved with contractor personnel 
traveling to the Government facility for the purpose of repairing the 
product onsite shall be borne by the Contractor during the 90-day 
warranty period.

                             (End of Clause)



552.246-75  Guarantees.

    As prescribed in 546.710(b), insert the following clause:

                          Guarantees (May 1989)

    (a) Unless otherwise provided in the specifications, the Contractor 
guarantees all work to be in accordance with contract requirements and 
free from defective or inferior materials, equipment, and workmanship 
for 1 year after the date of final acceptance or the date the equipment 
or work was placed in use by the Government, whichever occurs first.
    (b)(1) If, within any guarantee period, the Contracting Officer 
finds that guaranteed work requires repair or change because of 
defective or inferior materials, equipment, or workmanship or is not in 
accordance with contract requirements, the Contracting Officer shall 
notify the Contractor in writing. The Contractor shall promptly, and 
without additional expense to the Government, correct:
    (i) All guaranteed work;
    (ii) All damage to equipment, the site, the building or its contents 
resulting from the unsatisfactory guaranteed work; and
    (iii) Any work, materials, and equipment that are disturbed in 
fulfilling the guarantee, including any disturbed work, materials, and 
equipment that may have been guaranteed under another contract.
    (2) If the Contractor fails to proceed promptly in accordance with 
the guarantee, the Government may have such work performed at the 
expense of the Contractor.
    (c) Any special guarantees that may be required under the contract 
will be subject to paragraphs (a) and (b), insofar as they do not 
conflict with special guarantees.
    (d) The Contractor shall furnish to the Government: (1) Each 
transferable guarantee or warranty of equipment, materials, or 
installation furnished by any manufacturer, supplier, or installer in 
the ordinary course of business; (2) All information required to make 
such guarantee or warranty legally binding and effective; and (3) The 
information and the guarantee or warranty in sufficient time to permit 
the Government to meet any time limit specified in the guarantee or 
warranty or, if no time limit is specified, prior to completion and 
acceptance of all work under this contract.

                             (End of Clause)



552.246-76  Warranty of pesticides.

    As prescribed in 546.710, insert the following clause:

                    Warranty of Pesticides (May 1989)

    (a) Notwithstanding acceptance of pesticides by the Government, the 
Contractor warrants that for 1 year after the date of shipment, all 
pesticides furnished under this contract shall meet the requirements of 
Pub. L. 92-516, as amended, and shall be registered with the 
Environmental Protection Agency (EPA).
    (b) If EPA takes action to stop sale, stop use, remove, seize, or 
cancel registration of a pesticide within 1 year after date of shipment, 
the Contractor shall immediately notify the Contracting Officer. The 
notification will include: (1) Contract number; (2) identification of 
the pesticide; (3) reason for the EPA action against the pesticide; and 
(4) list of Government agencies and addresses to which it was delivered.

                             (End of Clause)



552.247-70  Placarding railcar shipments.

    As prescribed in 547.305, insert the following clause:

                 Placarding Railcar Shipments (May 1989)

    When a railcar is loaded in such a manner that it can be or should 
be unloaded from only one side, the Contractor shall place on the 
appropriate railcar door a placard reading ``Unload From This Side'' and 
on the opposite door a placard reading ``Unload From Other Side.''

[[Page 464]]

                             (End of Clause)



552.249-70  Termination for convenience of the Government (fixed-price) (short form).

    As prescribed in 549.502 insert the following clause:

Termination for Convenience of the Government (Fixed-Price) (Short Form) 
            (May 1988) (Deviation FAR 52.249-1 and 52.249-2)

    (a) If the Government terminates this contract for convenience, the 
rights of the Government and the Contractor shall be determined under 
paragraph (b) unless there is a termination liability schedule, in which 
case the rights of the parties shall be determined under paragraph (c).
    (b) The clause at [Contracting Officer inserts 52.249-1 or 52.249-2, 
as applicable] of the FAR shall apply to the supply portion of the 
contract and the clause at 52.249-4 of the FAR shall apply to the 
service portion of the contract.
    (c) If the Contractor specifies a schedule of termination liability 
charges that would be incurred by the Government if the Government 
terminates this lease contract without taking title to the equipment, 
the payment of such charges shall be the only responsibility of the 
Government to compensate the Contractor for such termination; except 
that, there shall be no termination liability for equipment installed 
after termination of this contract.

                             (End of Clause)

[54 FR 26558, June 23, 1989, as amended at 54 FR 40061, Sept. 29, 1989]



552.249-71  Submission of termination liability schedule.

    As prescribed in 549.570 insert the following clause:

         Submission of Termination Liability Schedule (May 1989)

    (a) An offeror may submit, as part of its proposal, a termination 
liability schedule to be applied if any resultant contract is terminated 
by the Government for reasons other than default. The offeror shall 
provide and explain the amount and method of computation of the 
termination liability charge(s).
    (b) If submitted, the termination liability schedule will be 
incorporated into Part I, Section B of the contract document. If a 
termination liability schedule is not submitted and the Government 
terminates any resultant contract for its convenience, the rights of the 
parties shall be determined under paragraph (b) of the GSAR Termination 
for Convenience of the Government clause at 552.249-70.
    (c) Any termination liability charges existing at the end of the 
evaluated contract period will be considered in the evaluation of 
offers.

                             (End of Clause)



552.252-5  Authorized deviations or variations in provisions.

    As prescribed in 552.107(a), insert the following provision:

Authorized Deviations or Variations in Provisions (Deviation FAR 52.252-
                              5) (Jul 1985)

    (a) The use in this solicitation of any Federal Acquisition 
Regulation (48 CFR Chapter 1) provision with an authorized deviation or 
variation is indicated by the addition of ``(Deviation)'' or 
``(Variation)'' after the date of the provision, if the provision is not 
published in the General Services Administration Acquisition Regulation 
(48 CFR Chapter 5). The use in this solicitation of any Federal 
Acquisition Regulation (FAR) provision with an authorized deviation or 
variation that is published in the General Services Administration 
Acquisition Regulation is indicated by the addition of ``(Deviation (FAR 
provision no.))'' or ``(Variation (FAR provision no.))'' after the date 
of the provision.
    (b) The use in this solicitation of any General Services 
Administration Acquisition Regulation provision with an authorized 
deviation or variation is indicated by the addition of ``(Deviation)'' 
or ``(Variation)'' after the date of the provision.
    (c) Changes in wording of provisions that are prescribed for use on 
a ``substantially the same as'' basis are not considered deviations. 
Therefore, when such provisions are not worded exactly the same as the 
FAR or GSAR provision, they are identified by the word ``(Variation).''

                           (End of Provision)



552.252-6  Authorized deviations or variations in clauses.

    As prescribed in 552.107(b), insert the following clause:

Authorized Deviations or Variations in Clauses (Deviation FAR 52.252-6) 
                               (Jul 1985)

    (a) The use in this solicitation or contract of any Federal 
Acquisition Regulation (48 CFR Chapter 1) clause with an authorized 
deviation or variation is indicated by the addition of ``(Deviation)'' 
or ``(Variation)'' after the date of the clause, if the clause is not 
published in the General Services Administration Acquisition Regulation 
(48 CFR Chapter 5). The use in this solicitation of any Federal 
Acquisition Regulation (FAR)

[[Page 465]]

clause with an authorized deviation or variation that is published in 
the General Services Administration Acquisition Regulation is indicated 
by the addition of ``(Deviation (FAR clause no.))'' or ``(Variation (FAR 
clause no.))'' after the date of the clause.
    (b) The use in this solicitation of any General Services 
Administration Acquisition Regulation clause with an authorized 
deviation or variation is indicated by the addition of ``(Deviation)'' 
or ``(Variation)'' after the date of the clause.
    (c) Changes in wording of clauses that are prescribed for use on a 
``substantially the same as'' basis are not considered deviations. 
Therefore, when such clauses are not worded exactly the same as the FAR 
or GSAR clause, they are identified by the word ``(Variation).''

                             (End of Clause)



552.270-1  Preparation of offers.

    As prescribed in 570.702(a), insert the following provision:

                    Preparation of Offers (Apr 1985)

    (a) Offerors are expected to read all parts of this solicitation.
    (b) Offers must be (1) submitted on the forms prescribed and 
furnished by the Government as a part of this solicitation or on copies 
of those forms, and (2) signed. The person signing an offer must initial 
each erasure or change appearing on any offer form. If the offeror is a 
partnership, the names of the partners composing the firm must be 
included with the offer.
    (c) Offers will be construed to be in full and complete compliance 
with this solicitation unless the offer describes any deviation in the 
offer.

                           (End of Provision)

[54 FR 26558, June 23, 1989, as amended at 60 FR 42795, Aug. 17, 1995]



552.270-2  Explanation to prospective offerors.

    As prescribed in 570.702(b), insert the following provision:

             Explanation to Prospective Offerors (June 1985)

    Any prospective offeror desiring an explanation or interpretation of 
the solicitation should request it in writing. Oral explanations or 
instructions given to a prospective offeror will not be binding. Any 
information given to a prospective offeror concerning a solicitation 
will be furnished promptly to all other prospective offerors, if that 
information is necessary in submitting offers or if the lack of it would 
be prejudicial to any other prospective offeror.

                           (End of Provision)

[54 FR 26558, June 23, 1989, as amended at 60 FR 42795, Aug. 17, 1995]



552.270-3  Late submissions, modifications, and withdrawals of offers.

    As prescribed in 570.702(c), insert the following provision:

  Late Submissions, Modifications, and Withdrawals of Offers (Aug 1995)

    (a) Any offer received at the office designated in the solicitation 
after the exact time specified for receipt of initial offers will not be 
considered unless it is received before award is made and it--
    (1) Was sent by registered or certified mail not later than the 
fifth calendar day before the date specified for receipt of offers 
(e.g., an offer submitted in response to a solicitation requiring 
receipt of offers by the 20th of the month must have been mailed by the 
15th);
    (2) Was sent by mail or, if authorized by the solicitation, was sent 
by telegram or via facsimile and it is determined by the Government that 
the late receipt was due solely to mishandling by the Government after 
receipt at the Government installation;
    (3) Was sent by U.S. Postal Service Express Mail Next Day Service-
Post Office to Addressee not later than 5:00 p.m. at the place of 
mailing two working days prior to the date specified for receipt of 
offers. The term ``working days'' excludes weekends and U.S. Federal 
holidays; or
    (4) Is the only offer received.
    (b) A modification resulting from the Contracting Officer's request 
for ``best and final'' offers received after the date and time specified 
in the request will not be considered unless received before award and 
the late receipt is due solely to mishandling by the Government after 
timely receipt at the Government installation.
    (c) The only acceptable evidence to establish the date of mailing of 
a late offer or modification sent either by U.S. Postal Service 
registered or certified mail is the U.S. or Canadian Postal Service 
postmark both on the envelope or wrapper and on the original receipt 
from the U.S. or Canadian Postal Service. Both postmarks must show a 
legible date or the offer or modification shall be processed as if 
mailed late. ``Postmark'' means a printed, stamped, or otherwise placed 
impression (exclusive of a postage meter machine impression) that is 
readily identifiable without further action as having been supplied and 
affixed by employees of the U.S. or Canadian Postal Service on the date 
of mailing. Therefore, offerors should request the postal clerk to place 
a legible hand cancellation bull's eye postmark on

[[Page 466]]

both the receipt and the envelope or wrapper.
    (d) The only acceptable evidence to establish the time of receipt at 
the Government installation is the time/date stamp of that installation 
on the offer wrapper or other documentary evidence of receipt maintained 
by the installation.
    (e) The only acceptable evidence to establish the date of mailing of 
a late offer, modification, or withdrawal sent by Express Mail Next Day 
Service-Post Office to Addressee is the date entered by the post office 
receiving clerk on the ``Express Mail Next Day Service-Post Office to 
Addressee'' label and the postmark on both the envelope or wrapper and 
on the original receipt from the U.S. Postal Service. ``Postmark'' has 
the same meaning as defined in paragraph (c) of this provision, 
excluding postmarks of the Canadian Postal Service. Therefore, offerors 
should request the postal clerk to place a legible hand cancellation 
bull's eye postmark on both the receipt and the envelope or wrapper.
    (f) Notwithstanding paragraph (a) of this provision, a late 
modification of an otherwise successful offer that makes its terms more 
favorable to the Government will be considered at any time it is 
received and may be accepted.
    (g) Offers may be withdrawn by written notice or telegram (including 
mailgram) received at any time before award. If the solicitation 
authorizes facsimile offers, offers may be withdrawn via facsimile 
received at any time before award, subject to the conditions specified 
in the provision entitled ``Facsimile Proposals.'' Offers may be 
withdrawn in person by an offeror or an authorized representative, if 
the representative's identity is made known and the representative signs 
a receipt for the offer before award.

                           (End of Provision)

                         Alternate I (AUG 1995)

    As prescribed in 570.702(c), substitute the following paragraph for 
paragraph (a) of the basic clause:
    (a) Any offer received at the office designated in the solicitation 
after the exact time specified for receipt of best and final offers will 
not be considered unless it is received before award is made and it--
[57 FR 23163, June 2, 1992, as amended at 60 FR 42795, Aug. 17, 1995]



552.270-4  Historic preference.

    As prescribed in 570.702(d), insert the following provision:

                     Historic Preference (Aug 1994)

    (a) Preference will be given to offers of space in buildings on, or 
formally listed as eligible for inclusion in the National Register of 
Historic Places and to historically significant buildings in historic 
districts listed in the National Register. Such preference will be 
extended to historic buildings and will result in award if:
    (1) The offer for space meets the terms and conditions of this 
solicitation as well as any other offer received. (It is within the 
discretion of the Contracting Officer to accept alternatives to certain 
architectural characteristics and safety features defined elsewhere in 
this solicitation to maintain the historical integrity of the building 
such as high ceilings, wooden floors, etc.); and
    (2) The rental is no more than 10 percent higher on a total annual 
square foot (occupiable) cost to the Government than the lowest 
otherwise acceptable offer.
    (b) If more than one offer of an historic building is received and 
they meet the above criteria, an award will then be made to the lowest 
priced historic property offered.

                           (End of Provision)

[54 FR 26558, June 23, 1989, as amended at 59 FR 52253, Oct. 17, 1994; 
60 FR 42795, Aug. 17, 1995]



552.270-5  Lease award.

    As prescribed in 570.702(e), insert the following provision:

                         Lease Award (June 1985)

    (a) The Government will award a lease resulting from this 
solicitation to the responsible offeror, whose offer conforming to the 
solicitation, will be most advantageous to the Government, price and 
other factors specified elsewhere in this solicitation, considered.
    (b) The Government may (1) reject any or all offers, (2) accept 
other than the lowest priced offer, and (3) waive informalities and 
minor irregularities in offers received.
    (c) Negotiations conducted after receipt of an offer do not 
constitute a rejection or counteroffer by the Government.
    (d) The unconditional acceptance of an offer establishes a valid 
contract.

                           (End of Provision)

[54 FR 26558, June 23, 1989, as amended at 60 FR 42795, Aug. 17, 1995]



552.270-6  Parties to execute lease.

    As prescribed in 570.702(f), insert the following provision:

[[Page 467]]

                   PARTIES TO EXECUTE LEASE (AUG 1992)

    (a) If the lease is executed by an attorney, agent, or trustee on 
behalf of the Lessor, an authenticated copy of his power of attorney, or 
other evidence to act on behalf of the Lessor, shall accompany the 
lease.
    (b) If the Lessor is a partnership, the lease shall be signed with 
the partnership name, followed by the name of the legally authorized 
partner signing the same, and, if required by the Government, a copy of 
either the partnership agreement or current Certificate of Limited 
Partnership shall accompany the lease.
    (c) If the Lessor is a corporation, the lease shall be signed with 
the corporate name, followed by the signature and title of the officer 
or other person signing the lease on its behalf, duly attested, and, if 
requested by the Government, evidence of this authority to so act shall 
be furnished.

(End of Provision)
[57 FR 37890, Aug. 21, 1992, as amended at 60 FR 42795, Aug. 17, 1995]



552.270-10  Definitions.

    As prescribed in 570.703(a)(1), insert the following clause:

                         Definitions (Aug 1992)

    The following terms and phrases (except as otherwise expressly 
provided or unless the context otherwise requires) for all purposes of 
this lease shall have the respective meanings hereinafter specified:
    (a) Commencement Date means the first day of the term.
    (b) Contract and Contractor means Lease and Lessor, respectively.
    (c) Contracting Officer means a person with the authority to enter 
into, administer, and/or terminate contracts and make related 
determinations and findings. The term includes certain authorized 
representatives of the Contracting Officer acting within the limits of 
their authority as delegated by the Contracting Officer.
    (d) Delivery Date means the date specified in or determined pursuant 
to the provisions of this lease for delivery of the premises to the 
Government, improved in accordance with the provisions of this lease and 
substantially complete, as such date may be modified in accordance with 
the provisions of this lease.
    (e) Delivery Time means the number of days provided by this lease 
for delivery of the premises to the Government, as such number may be 
modified in accordance with the provisions of this lease.
    (f) Excusable Delays mean delays arising without the fault or 
negligence of Lessor and Lessor's subcontractors and suppliers at any 
tier, and shall include, without limitation:
    (1) Acts of God or of the public enemy,
    (2) Acts of the United States of America in either its sovereign or 
contractual capacity,
    (3) Acts of another contractor in the performance of a contract with 
the Government,
    (4) Fires,
    (5) Floods,
    (6) Epidemics,
    (7) Quarantine restrictions,
    (8) Strikes,
    (9) Freight embargoes,
    (10) Unusually severe weather, or
    (11) Delays of subcontractors or suppliers at any tier arising from 
unforeseeable causes beyond the control and without the fault or 
negligence of both the Lessor and any such subcontractor or supplier.
    (g) Lessor means the sub-lessor if this lease is a sublease.
    (h) Lessor shall provide means the Lessor shall furnish and install 
at Lessor's expense.
    (i) Notice means written notice sent by certified or registered 
mail, Express Mail or comparable service, or delivered by hand. Notice 
shall be effective on the date delivery is accepted or refused.
    (j) Premises means the space described in this lease.
    (k) Substantially complete and substantial completion means that the 
work, the common and other areas of the building, and all other things 
necessary for the Government's access to the premises and occupancy, 
possession, use and enjoyment thereof, as provided in this lease, have 
been completed or obtained, excepting only such minor matters as do not 
interfere with or materially diminish such access, occupancy, 
possession, use or enjoyment.
    (l) Work means all alterations, improvements, modifications, and 
other things required for the preparation or continued occupancy of the 
premises by the Government as specified in this lease.

(End of Clause)
[57 FR 37890, Aug. 21, 1992, as amended at 57 FR 52826, Nov. 5, 1992; 60 
FR 42795, Aug. 17, 1995]



552.270-11  Subletting and assignment.

    As prescribed in 570.703(a)(2), insert the following clause:

                  Subletting and Assignment (Aug 1992)

    The Government may sublet any part of the premises but shall not be 
relieved from any obligations under this lease by reason of any such 
subletting. The Government may at any time assign this lease, and be 
relieved from all obligations to Lessor under this lease excepting only 
unpaid rent and other liabilities, if any, that have accrued to the date 
of said assignment. Any assignment shall be subject to prior written 
consent of

[[Page 468]]

lessor, which shall not be unreasonably withheld.

(End of Clause)
[57 FR 37891, Aug. 21, 1992, as amended at 60 FR 42795, Aug. 17, 1995]



552.270-12  Maintenance of building and premises--Right of entry.

    As prescribed in 570.703(a)(3), insert the following clause:

     Maintenance of Building and Premises--Right of Entry (Aug 1992)

    Except in case of damage arising out of the willful act or 
negligence of a Government employee, Lessor shall maintain the premises, 
including the building and all equipment, fixtures, and appurtenances 
furnished by the Lessor under this lease, in good repair and condition 
so that they are suitable in appearance and capable of supplying such 
heat, air conditioning, light, ventilation, access and other things to 
the premises, without reasonably preventable or recurring disruption, as 
is required for the Government's access to, occupancy, possession, use 
and enjoyment of the premises as provided in this lease. For the purpose 
of so maintaining the premises, the Lessor may at reasonable times enter 
the premises with the approval of the authorized Government 
representative in charge.

(End of Clause)
[57 FR 37891, Aug. 21, 1992, as amended at 60 FR 42795, Aug. 17, 1995]



552.270-13  Fire and casualty damage.

    As prescribed in 570.703(a)(4), insert the following clause:

                   Fire and Casualty Damage (Aug 1992)

    If the entire premises are destroyed by fire or other casualty, this 
lease will immediately terminate. In case of partial destruction or 
damage, so as to render the premises untenantable, as determined by the 
Government, the Government may terminate the lease by giving written 
notice to the Lessor within 15 calendar days of the fire or other 
casualty; if so terminated, no rent will accrue to the Lessor after such 
partial destruction or damage; and if not so terminated, the rent will 
be reduced proportionately by supplemental agreement hereto effective 
from the date of such partial destruction or damage. Nothing in this 
lease shall be construed as relieving Lessor from liability for damage 
to or destruction of property of the United States of America caused by 
the willful or negligent act or omission of Lessor.

(End of Clause)
[57 FR 37891, Aug. 21, 1992, as amended at 60 FR 42795, Aug. 17, 1995]



552.270-14  [Reserved]



552.270-15  Compliance with applicable law.

    As prescribed in 570.703(a)(5), insert the following clause:

                Compliance with Applicable Law (Aug 1992)

    Lessor shall comply with all Federal, state and local laws 
applicable to the Lessor as owner or lessor, or both, of the building or 
premises, including, without limitation, laws applicable to the 
construction, ownership, alteration or operation of both or either 
thereof, and will obtain all necessary permits, licenses and similar 
items at Lessor's expense. The Government will comply with all Federal, 
state and local laws applicable to and enforceable against it as a 
tenant under this lease; provided that nothing in this lease shall be 
construed as a waiver of any sovereign immunity of the Government. This 
lease shall be governed by Federal law.

(End of Clause)
[57 FR 37891, Aug. 21, 1992, as amended at 60 FR 42795, Aug. 17, 1995]



552.270-16  Inspection--Right of entry.

    As prescribed in 570.703(a)(6), insert the following clause:

                  INSPECTION--RIGHT OF ENTRY (AUG 1992)

    (a) At any time and from time to time after receipt of an offer 
(until the same has been duly withdrawn or rejected), after acceptance 
thereof and during the term, the agents, employees and contractors of 
the Government may, upon reasonable prior notice to Offeror or Lessor, 
enter upon the offered premises or the premises, and all other areas of 
the building access to which is necessary to accomplish the purposes of 
entry, to determine the potential or actual compliance by the Offeror or 
Lessor with the requirements of the solicitation or this lease, which 
purposes shall include, but not be limited to:
    (1) Inspecting, sampling and analyzing suspected asbestos-containing 
materials and air monitoring for asbestos fibers;
    (2) Inspecting the heating, ventilation and air conditioning system, 
maintenance records, and mechanical rooms for the offered premises or 
the premises;
    (3) Inspecting for any leaks, spills, or other potentially hazardous 
conditions which may involve tenant exposure to hazardous or toxic 
substances; and
    (4) Inspecting for any current or past hazardous waste operations, 
to ensure that appropriate mitigative actions were taken to

[[Page 469]]

alleviate any environmentally unsound activities in accordance with 
Federal, State, and local law.
    (b) Nothing in this clause shall be construed to create a Government 
duty to inspect for toxic materials or to impose a higher standard of 
care on the Government than on other leases. The purpose of this clause 
is to promote the ease with which the Government may inspect the 
building. Nothing in this clause shall act to relieve the Lessor of any 
duty to inspect or liability which might arise as a result of Lessor's 
failure to inspect for or correct a hazardous condition.
    (End of Clause)
[57 FR 37891, Aug. 21, 1992, as amended at 60 FR 42795, Aug. 17, 1995]



552.270-17  Failure in performance.

    As prescribed in 570.703(a)(7), insert the following clause:

                    FAILURE IN PERFORMANCE (AUG 1992)

    The covenant to pay rent and the covenant to provide any service, 
utility, maintenance, or repair required under this lease are 
interdependent. In the event of any failure by the Lessor to provide any 
service, utility, maintenance, repair or replacement required under this 
lease the Government may, by contract or otherwise, perform the 
requirement and deduct from any payment or payments under this lease, 
then or thereafter due, the resulting cost to the Government, including 
all administrative costs. If the Government elects to perform any such 
requirement, the Government and each of its contractors shall be 
entitled to access to any and all areas of the building, access to which 
is necessary to perform any such requirement, and the Lessor shall 
afford and facilitate such access. Alternatively, the Government may 
deduct from any payment or payments under this lease, then or thereafter 
due, an amount which reflects the reduced value of the contract 
requirement not performed. No deduction from rent pursuant to this 
clause shall constitute a default by the Government under this lease. 
These remedies are not exclusive and are in addition to any other 
remedies which may be available under this lease or at law.
    (End of Clause)
[57 FR 37891, Aug. 21, 1992, as amended at 60 FR 42795, Aug. 17, 1995]



552.270-18  Successors bound.

    As prescribed in 570.703(a)(8), insert the following clause:

                       SUCCESSORS BOUND (AUG 1992)

    This lease shall bind, and inure to the benefit of, the parties and 
their respective heirs, executors, administrators, successors and 
assigns.
    (End of Clause)
[57 FR 37892, Aug. 21, 1992, as amended at 60 FR 42795, Aug. 17, 1995]



552.270-19  Alterations.

    As prescribed in 570.703(a)(9), insert the following clause:

                         Alterations (June 1985)

    The Government shall have the right during the existence of this 
lease to make alterations, attach fixtures, and erect structures or 
signs in or upon the premises hereby leased, which fixtures, additions 
or structures so placed in, on, upon, or attached to the said premises 
shall be and remain the property of the Government and may be removed or 
otherwise disposed of by the Government. If the lease contemplates that 
the Government is the sole occupant of the building, for purposes of 
this clause, the leased premises include the land on which the building 
is sited and the building itself. Otherwise, the Government shall have 
the right to tie into or make any physical connection with any structure 
located on the property as is reasonably necessary for appropriate 
utilization of the leased space.

                             (End of Clause)

[54 FR 26558, June 23, 1989, as amended at 60 FR 42795, Aug. 17, 1995]



552.270-20  Proposals for adjustment.

    As prescribed in 570.703(a)(10), insert the following clause:

                   PROPOSALS FOR ADJUSTMENT (APR 1995)

    (a) The Contracting Officer may, from time to time during the term 
of this lease, require changes to be made in the work or services to be 
performed and in the terms or conditions of this lease. Such changes 
will be required under the Changes clause.
    (b) If the Contracting Officer makes a change within the general 
scope of the lease, the Lessor shall submit, in a timely manner, an 
itemized cost proposal for the work to be accomplished or services to be 
performed when the cost exceeds $100,000. The proposal, including all 
subcontractor work, will contain at least the following details--
    (1) Material quantities and unit costs;
    (2) Labor costs (identified with specific item or material to be 
placed or operation to be performed);
    (3) Equipment costs;
    (4) Worker's compensation and public liability insurance;
    (5) Overhead;
    (6) Profit; and

[[Page 470]]

    (7) Employment taxes under FICA and FUTA.
    (c) The following Federal Acquisition Regulation (FAR) provisions 
also apply to all proposals exceeding $500,000 in cost--
    (1) The Lessor shall provide cost or pricing data including 
subcontractor cost or pricing data (48 CFR 15.804-2);
    (2) The Lessor's representative, all Contractors, and subcontractors 
whose portion of the work exceeds $500,000 must sign and return the 
``Certificate of Current Cost or Pricing Data'' (48 CFR 15.804-4); and
    (3) The agreement for ``Price Reduction for Defective Cost or 
Pricing Data'' must be signed and returned (48 CFR 15.804-8).
    (d) Lessors shall also refer to 48 CFR Part 31, Contract Cost 
Principles, for information on which costs are allowable, reasonable, 
and allocable in Government work.
    (End of Clause)
[57 FR 37892, Aug. 21, 1992, as amended at 60 FR 19363, Apr. 18, 1995; 
60 FR 42795, Aug. 17, 1995]



552.270-21  Changes.

    As prescribed in 570.703(a)(11), insert the following clause:

                           CHANGES (Aug 1995)

    (a) The Contracting Officer may at any time, by written order, make 
changes within the general scope of this lease in any one or more of the 
following:
    (1) Specifications (including drawings and designs);
    (2) Work or services;
    (3) Facilities or space layout; or
    (4) Amount of space, provided the Lessor consents to the change.
    (b) If any such change causes an increase or decrease in Lessor's 
cost of or the time required for performance under this lease, whether 
or not changed by the order, the Contracting Officer shall modify this 
lease to provide for one or more of the following:
    (1) A modification of the delivery date;
    (2) An equitable adjustment in the rental rate;
    (3) A lump sum equitable adjustment; or
    (4) An equitable adjustment of the annual operating costs per 
occupiable square foot specified in this lease.
    (c) The Lessor shall assert its right to an adjustment under this 
clause within 30 days from the date of receipt of the change order and 
shall submit a proposal for adjustment. Failure to agree to any 
adjustment shall be a dispute under the Disputes clause. However, 
nothing in this clause shall excuse the lessor from proceeding with the 
change as directed.
    (d) Absent such written change order, the Government shall not be 
liable to Lessor under this clause.
    (End of Clause)
[57 FR 37892, Aug. 21, 1992, as amended at 59 FR 52253, Oct. 17, 1994; 
60 FR 42795, Aug. 17, 1995]



552.270-22  Liquidated damages.

    As prescribed in 570.703(b), insert the following clause:

                      LIQUIDATED DAMAGES (AUG 1992)

    In case of failure on the part of the Lessor to complete the work 
within the time fixed in the lease contract or letter of award, the 
Lessor shall pay the Government as fixed and agreed liquidated damages, 
pursuant to this clause, the sum of $________ for each and every 
calendar day that the delivery is delayed beyond the date specified for 
delivery of all of the space ready for occupancy by the Government. This 
remedy is not exclusive and is in addition to any other remedies which 
may be available under this lease or at law.
    (End of Clause)
[57 FR 37892, Aug. 21, 1992, as amended at 60 FR 42796, Aug. 17, 1995]



552.270-23--552.270-24  [Reserved]



552.270-25  Adjustment for vacant premises.

    As prescribed in 570.703(a)(12), insert the following clause:

                Adjustment for Vacant Premises (Aug 1994)

    (a) If the Government fails to occupy any portion of the leased 
premises or vacates the premises in whole or in part prior to expiration 
of the firm term of the lease, the rental rate will be reduced.
    (b) The rate will be reduced by that portion of the costs per 
occupiable square foot of operating expenses not required to maintain 
the space. Said reduction must occur after the Government gives 30 
calendar days prior notice to the Lessor, and must continue in effect 
until the Government occupies the premises or the lease expires or is 
terminated.

                             (End of Clause)

[54 FR 26558, June 23, 1989, as amended at 59 FR 52253, Oct. 17, 1994; 
60 FR 42796, Aug. 17, 1995]



552.270-26  [Reserved]



552.270-27  Delivery and condition.

    As prescribed in 570.703(a)(13), insert the following clause:

[[Page 471]]

                    DELIVERY AND CONDITION (AUG 1992)

    (a) Unless the Government elects to have the space occupied in 
increments, the space must be delivered ready for occupancy as a 
complete unit. The Government reserves the right to determine when the 
space is substantially complete.
    (b) If the premises do not in every respect comply with the 
provisions of this lease the Contracting Officer may, in accordance with 
the Failure in Performance clause of this lease, elect to reduce the 
rent payments.
    (End of Clause)
[57 FR 37893, Aug. 21, 1992, as amended at 60 FR 42796, Aug. 17, 1995]



552.270-28  Default in delivery--Time Extensions.

    As prescribed in 570.703(a)(14), insert the following clause:

             DEFAULT IN DELIVERY--TIME EXTENSIONS (AUG 1994)

    (a) With respect to Lessor's obligation to deliver the premises 
substantially complete by the delivery date (as such date may be 
modified pursuant to this lease), time is of the essence. If the Lessor 
fails to prosecute the work with the diligence that will ensure its 
substantial completion by the delivery date or fails to substantially 
complete the work by such date, the Government may by notice to the 
Lessor terminate this lease, which termination shall be effective when 
received by Lessor. The Lessor and the Lessor's sureties, if any, shall 
be jointly and severally liable for any damages to the Government 
resulting from such termination, as provided in this clause. The 
Government shall be entitled to the following damages:
    (1) The Government's aggregate rent and estimated real estate tax 
and operating cost adjustments for the firm term and all option terms of 
its replacement lease or leases, in excess of the aggregate rent and 
estimated real estate tax and operating cost adjustments for the term; 
provided, if the Government procures replacement premises for a term 
(including all option terms) in excess of the term, the Lessor shall not 
be liable for excess Government rent or adjustments during such excess 
part of such term;
    (2) All administrative and other costs borne by the Government in 
procuring a replacement lease or leases;
    (3) Such other, additional relief as may be provided for in this 
lease, at law or in equity.
    (4) Damages to which the Government may be entitled under this 
clause shall be due and payable thirty (30) days next following the date 
Lessor receives notice from the Contracting Officer specifying such 
damages.
    (b) Delivery by Lessor of less than the minimum occupiable square 
footage required by this lease shall in no event be construed as 
substantial completion, except as permitted by the Contracting Officer.
    (c) Notwithstanding in paragraph (a) of this clause, this lease 
shall not be terminated under this clause nor the Lessor charged with 
damages under this clause, if;
    (1) The delay in substantially completing the work arises from 
excusable delays and
    (2) The Lessor within 10 days from the beginning of any such delay 
(unless extended in writing by the Contracting Officer) provides notice 
to the Contracting Officer of the causes of delay. The Contracting 
Officer shall ascertain the facts and the extent of delay. If the facts 
warrant such action, the delivery date shall be extended, by the 
Contracting Officer, to the extent of such delay at no additional costs 
to the Government. A time extension is the sole remedy of the Lessor.
    (End of Clause)
[57 FR 37893, Aug. 21, 1992, as amended at 57 FR 52826, Nov. 5, 1992; 59 
FR 52253, Oct. 17, 1994; 60 FR 42796, Aug. 17, 1995]



552.270-29  [Reserved]



552.270-30  Progressive occupancy.

    As prescribed in 570.703(a)(15), insert the following clause:

                    PROGRESSIVE OCCUPANCY (Aug 1992)

    The Government shall have the right to elect to occupy the space in 
partial increments prior to the substantial completion of the entire 
leased premises, and the Lessor agrees to schedule its work so as to 
deliver the space incrementally as elected by the Government. The 
Government shall pay rent commencing with the first business day 
following substantial completion of the entire leased premise unless the 
Government has elected to occupy the leased premises incrementally. In 
case of incremental occupancy, the Government shall pay rent pro rata 
upon the first business day following substantial completion of each 
incremental unit. Rental payments shall become due on the first workday 
of the month following the month in which an increment of space is 
substantially complete, except that should an increment of space be 
substantially completed after the fifteenth day of the month, the 
payment due date will be the first workday of the second month following 
the month in which it was substantially complete. The commencement date 
of the firm lease term will be a composite determined from all rent 
commencement dates.
    (End of Clause)
[57 FR 37893, Aug. 21, 1992, as amended at 60 FR 42796, Aug. 17, 1995]

[[Page 472]]



552.270-31  Payment.

    As prescribed in 570.703(a)(16), insert the following clause:

                           Payment (Aug 1994)

    (a) When space is offered and accepted, the occupiable square 
footage delivered will be confirmed by:
    (1) the Government's measurement of plans submitted by the 
successful offeror as approved by the Government, and an inspection of 
the space to verify that the delivered space is in conformance with such 
plans; or
    (2) a mutual on-site measurement of the space if the Contracting 
Officer determines that it is necessary.
    (b) Payment will not be made for space which is in excess of the 
amount of occupiable square footage stated in the lease.
    (c) If it is determined that the amount of occupiable square footage 
actually delivered is less than the amount agreed to in the lease, the 
lease will be modified to reflect the amount of occupiable space 
delivered and the annual rental will be adjusted as follows:
    (1) Occupiable square feet not delivered multiplied by one plus the 
common area factor (CAF), multiplied by the rate per rentable square 
foot (RSF).
    (2) OSF x (1+CAF) x Rate per RSF=Reduction in Annual Rent.
[59 FR 52253, Oct. 17, 1994, as amended at 60 FR 42796, Aug. 17, 1995]



552.270-32  Effect of acceptance and occupancy.

    As prescribed in 570.703(a)(17), insert the following clause:

              EFFECT OF ACCEPTANCE AND OCCUPANCY (AUG 1992)

    Neither the Government's acceptance of the premises for occupancy, 
nor the Government's occupancy thereof, shall be construed as a waiver 
of any requirement of or right of the Government under this Lease, or as 
otherwise prejudicing the Government with respect to any such 
requirement or right.
    (End of Clause)
[57 FR 37893, Aug. 21, 1992, as amended at 60 FR 42796, Aug. 17, 1995]



552.270-33  Default by lessor during the term.

    As prescribed in 570.703(a)(18), insert the following provision:

              DEFAULT BY LESSOR DURING THE TERM (AUG 1992)

    (a) Each of the following shall constitute a default by Lessor under 
this lease:
    (1) Failure to maintain, repair, operate or service the premises as 
and when specified in this lease, or failure to perform any other 
requirement of this lease as and when required provided any such failure 
shall remain uncured for a period of thirty (30) days next following 
Lessor's receipt of notice thereof from the Contracting Officer or an 
authorized representative.
    (2) Repeated and unexcused failure by Lessor to comply with one or 
more requirements of this lease shall constitute a default 
notwithstanding that one or all such failures shall have been timely 
cured pursuant to this clause.
    (b) If a default occurs, the Government may, by notice to Lessor, 
terminate this lease for default and if so terminated, the Government 
shall be entitled to the damages specified in the Default in Delivery-
Time Extensions Clause.
    (End of Clause)
[57 FR 37893, Aug. 21, 1992, as amended at 60 FR 42796, Aug. 17, 1995]



552.270-34  Subordination, nondisturbance and attornment.

    As prescribed in 570.703(a)(19), insert the following clause:

         SUBORDINATION, NONDISTURBANCE AND ATTORNMENT (AUG 1992)

    (a) Lessor warrants that it holds such title to or other interest in 
the premises and other property as is necessary to the Government's 
access to the premises and full use and enjoyment thereof in accordance 
with the provisions of this lease. Government agrees, in consideration 
of the warranties and conditions set forth in this clause, that this 
lease is subject and subordinate to any and all recorded mortgages, 
deeds of trust and other liens now or hereafter existing or imposed upon 
the premises, and to any renewal, modification or extension thereof. It 
is the intention of the parties that this provision shall be self-
operative and that no further instrument shall be required to effect the 
present or subsequent subordination of this lease. Government agrees, 
however, within twenty (20) business days next following the Contracting 
Officer's receipt of a written demand, to execute such instruments as 
Lessor may reasonably request to evidence further the subordination of 
this lease to any existing or future mortgage, deed of trust or other 
security interest pertaining to the premises, and to any water, sewer or 
access easement necessary or desirable to serve the premises or 
adjoining property owned in whole or in part by Lessor if such easement 
does not interfere with the full enjoyment of any right granted the 
Government under this lease.
    (b) No such subordination, to either existing or future mortgages, 
deeds of trust or

[[Page 473]]

other lien or security instrument shall operate to affect adversely any 
right of the Government under this lease so long as the Government is 
not in default under this lease. Lessor will include in any future 
mortgage, deed of trust or other security instrument to which this lease 
becomes subordinate, or in a separate nondisturbance agreement, a 
provision to the foregoing effect. Lessor warrants that the holders of 
all notes or other obligations secured by existing mortgages, deeds of 
trust or other security instruments have consented to the provisions of 
this clause, and agrees to provide true copies of all such consents to 
the Contracting Officer promptly upon demand.
    (c) In the event of any sale of the premises or any portion thereof 
by foreclosure of the lien of any such mortgage, deed of trust or other 
security instrument, or the giving of a deed in lieu of foreclosure, the 
Government will be deemed to have attorned to any purchaser, purchasers, 
transferee or transferees of the premises or any portion thereof and its 
or their successors and assigns, and any such purchasers and transferees 
will be deemed to have assumed all obligations of the Lessor under this 
lease, so as to establish direct privity of estate and contract between 
Government and such purchasers or transferees, with the same force, 
effect and relative priority in time and right as if the lease had 
initially been entered into between such purchasers or transferees and 
the Government; provided, further, that the Contracting Officer and such 
purchasers or transferees shall, with reasonable promptness following 
any such sale or deed delivery in lieu of foreclosure, execute all such 
revisions to this lease, or other writings, as shall be necessary to 
document the foregoing relationship.
    (d) None of the foregoing provisions may be deemed or construed to 
imply a waiver of the Government's rights as a sovereign.
    (End of Clause)
[57 FR 37894, Aug. 21, 1992, as amended at 60 FR 42796, Aug. 17, 1995]



552.270-35  Statement of lease.

    As prescribed in 570.703(a)(20), insert the following clause:

                      STATEMENT OF LEASE (AUG 1992)

    (a) The Contracting Officer will, within thirty (30) days next 
following the Contracting Officer's receipt of a joint written request 
from Lessor and a prospective lender or purchaser of the building, 
execute and deliver to Lessor a letter stating that the same is issued 
subject to the conditions stated in this clause and, if such is the 
case, that:
    (1) the lease is in full force and effect;
    (2) the date to which the rent and other charges have been paid in 
advance, if any; and
    (3) whether any notice of default has been issued.
    (b) Letters issued pursuant to this clause are subject to the 
following conditions:
    (1) That they are based solely upon a reasonably diligent review of 
the Contracting Officer's lease file as of the date of issuance;
    (2) That the Government shall not be held liable because of any 
defect in or condition of the premises or building;
    (3) That the Contracting Officer does not warrant or represent that 
the premises or building comply with applicable Federal, State and local 
law; and
    (4) That the Lessor, and each prospective lender and purchaser are 
deemed to have constructive notice of such facts as would be 
ascertainable by reasonable prepurchase and precommitment inspection of 
the Premises and Building and by inquiry to appropriate Federal, State 
and local Government officials.
    (End of Clause)
[57 FR 37894, Aug. 21, 1992, as amended at 60 FR 42796, Aug. 17, 1995]



552.270-36  Substitution of tenant agency.

    As prescribed in 570.703(a)(21), insert the following clause:

                SUBSTITUTION OF TENANT AGENCY (AUG 1992)

    The Government may, at any time and from time to time, substitute 
any Government agency or agencies for the Government agency or agencies, 
if any, named in the lease.
    (End of Clause)
[57 FR 37894, Aug. 21, 1992, as amended at 60 FR 42796, Aug. 17, 1995]



552.270-37  No waiver.

    As prescribed in 570.703(a)(22), insert the following clause:

                          NO WAIVER (AUG 1992)

    No failure by either party to insist upon the strict performance of 
any provision of this lease or to exercise any right or remedy 
consequent upon a breach thereof, and no acceptance of full or partial 
rent or other performance by either party during the continuance of any 
such breach shall constitute a waiver of any such breach of such 
provision.
    (End of Clause)
[57 FR 37894, Aug. 21, 1992, as amended at 57 FR 52826, Nov. 5, 1992; 60 
FR 42796, Aug. 17, 1995]



552.270-38  Integrated agreement.

    As prescribed in 570.703(a)(23), insert the following clause:

[[Page 474]]

                     INTEGRATED AGREEMENT (AUG 1992)

    This Lease, upon execution, contains the entire agreement of the 
parties and no prior written or oral agreement, express or implied, 
shall be admissible to contradict the provisions of the Lease.
    (End of Clause)
[57 FR 37894, Aug. 21, 1992, as amended at 60 FR 42796, Aug. 17, 1995]



552.270-39  Mutuality of obligation.

    As prescribed in 570.703(a)(24), insert the following clause:

                   MUTUALITY OF OBLIGATION (AUG 1992)

    The obligations and covenants of the Lessor, and the Government's 
obligation to pay rent and other Government obligations and covenants, 
arising under or related to this Lease, are interdependent. The 
Government may, upon issuance of and delivery to Lessor of a final 
decision asserting a claim against Lessor, set off such claim, in whole 
or in part, as against any payment or payments then or thereafter due 
the Lessor under this lease. No setoff pursuant to this clause shall 
constitute a breach by the Government of this lease.
    (End of Clause)
[57 FR 37894, Aug. 21, 1992, as amended at 60 FR 42796, Aug. 17, 1995]



552.270-40  Asbestos and hazardous waste management.

    As prescribed in 570.703(a)(25), insert the following clause:

           ASBESTOS AND HAZARDOUS WASTE MANAGEMENT (AUG 1992)

    The certifications made by the Offeror regarding asbestos and 
hazardous waste management contained in the representation and 
certification provisions of this lease are material representations of 
fact upon which the Government relies when making award. If it is later 
determined that the presence or management of asbestos and/or hazardous 
waste has been misrepresented, the Government reserves the right to 
require the Lessor, at no cost to the Government, to abate (remove, 
encapsulate, enclose, or repair) such asbestos and/or mitigate hazardous 
waste conditions, with such work performed in accordance with Federal 
(e.g., EPA, OSHA, and DOT), State, and local regulations and guidance, 
or, alternatively, the Government may terminate the lease. This is in 
addition to other remedies available to the Government.
    (End of Clause)
[57 FR 37894, Aug. 21, 1992, as amended at 60 FR 42796, Aug. 17, 1995]



552.270-41  Acceptance of space.

    As prescribed in 570.703(a)(26), insert the following clause:

                     Acceptance of Space (Aug 1994)

    (a) When the lessor has completed all alterations, improvements, and 
repairs necessary to meet the requirements of the lease, the lessor 
shall notify the Contracting Officer. The Contracting Officer or 
designated representative shall promptly inspect the space.
    (b) The Government will accept the space and the lease term will 
begin after determining that the space is substantially complete and 
contains the required occupiable square footage as indicated in 
Paragraph 1.1, Amount and Type of Space, of this solicitation.
[59 FR 52253, Oct. 17, 1994, as amended at 60 FR 42796, Aug. 17, 1995]



              Subpart 552.3--Provision and Clause Matrixes



552.300  Scope of subpart.

    This subpart consists of a series of matrixes, one each for supply, 
service, construction, architect-engineer and simplified acquisition 
contracts which lists the applicable GSA provisions and clauses; and one 
each for utility contracts (sole supplier-regulated rates) and leases of 
real property which list the applicable FAR and GSAR provisions and 
clauses.

    Note:  The matrixes do not appear in this volume of the Federal 
Register or Title 48, Chapter 5 of the Code of Federal Regulations. 
Individual copies may be obtained from the Director of the Office of GSA 
Acquisition Policy and Regulations (VP), 18th and F Street, NW., 
Washington, DC 20405.

[54 FR 26558, June 23, 1989, as amended at 60 FR 42804, Aug. 17, 1995]



PART 553--FORMS--Table of Contents




                         Subpart 553.1--General

553.101  Requirements for use of forms.
553.102  Current editions.
553.170  Establishing and revising GSA forms.
553.171  Forms incorporated by reference.

                  Subpart 553.3--Illustrations of Forms

553.300  Scope of subpart.

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

[[Page 475]]


    Source:  54 FR 26584, June 23, 1989, unless otherwise noted.



                         Subpart 553.1--General



553.101  Requirements for use of forms.

    (a) The requirements for use of GSA forms are explained in other 
parts of this regulation.
    (b) The location in the text where a form is prescribed is 
identified by a cross-reference shown on the illustration of the form. 
When a form is mentioned in more than one place in this regulation, the 
section referenced on the illustration is the section where the basic 
prescription can be found.



553.102  Current editions.

    Contracting officers shall use the current edition of the forms in 
Subpart 553.3 unless otherwise authorized under this regulation.



553.170  Establishing and revising GSA Forms.

    (a) If two or more GSA services/offices use a GSA form, the Office 
of Acquisition Policy is responsible for maintaining the form. When a 
GSA form is used by a particular GSA service/office or if the form is 
used in connection with a type of contract which is unique to one 
service/office (e.g., construction contracts), that service/office is 
responsible for maintenance of the form.
    (b) Proposed new or revised GSA procurement related forms must be 
submitted to the Office of Acquisition Policy for review and 
concurrence.



553.171  Forms incorporated by reference.

    Forms containing solicitation provisions and/or contract clauses may 
be incorporated by reference in solicitations/contracts.
    The contracting officer shall insert a clause substantially the same 
as the clause at 552.253-70 in solicitations and contracts when GSA 
Forms containing solicitation provisions and/or contract clauses are 
incorporated by reference.



                  Subpart 553.3--Illustrations of Forms



553.300  Scope of subpart.

    Standard and GSA forms prescribed or referenced in the text of this 
chapter are illustrated in and made a part of the GSAR loose-leaf 
edition. The forms are not illustrated in this volume of the Federal 
Register or Title 48, Chapter 5 of the Code of Federal Regulations. 
Copies may be obtained from the Director of the Office of GSA 
Acquisition Policy and Regulations (VP), 18th and F Streets, NW., 
Washington, DC 20405.

[[Page 476]]



                       SUBCHAPTERS I-M [RESERVED]





               SUBCHAPTER N--SPECIAL CONTRACTING PROGRAMS





PART 570--ACQUISITION OF LEASEHOLD INTERESTS IN REAL PROPERTY--Table of Contents




                         Subpart 570.1--General

Sec.
570.101  Applicability.
570.102  Definitions.
570.103  Authority to lease.
570.104  Contracting officers.
570.105  Competition.
570.106  Methods of contracting.

         Subpart 570.2--Simplified Lease Acquisition Procedures

570.201  Definitions.
570.202  Purpose.
570.203  Policy.
570.204  Procedures.
570.204-1  Market survey.
570.204-2  Competition.
570.204-3  Soliciting offers.
570.204-4  Negotiation, evaluation, and award.
570.204-5  Inspection.

  Subpart 570.3--Procedures for Contracting for Leasehold Interests in 
                              Real Property

570.301  Market surveys.
570.302  Publicizing/Advertising.
570.303  Solicitation for offers (SFO).
570.304  Changes to SFO's.
570.305  Negotiations.
570.306  Evaluating offers.
570.307  Late offers, modifications of offers, and withdrawals of 
          offers.
570.308  Preaward requirements.
570.308-1  General.
570.308-2  Cost or pricing data.
570.308-3  Proposal evaluation.
570.308-4  Responsibility determinations.
570.309  Award.
570.310  Debriefings.
570.311  Inspection.

            Subpart 570.4--Mistakes, Protests, Miscellaneous

570.401  Disclosure of mistakes after award.
570.402  Protests.
570.403  Awards to Federal employees.

   Subpart 570.5--Special Aspects of Contracting for Continuing Space 
                              Requirements

570.501  Renewal options.
570.502  Succeeding leases.
570.503  Expansion requests.
570.504  Superseding leases.
570.505  Lease extensions.

   Subpart 570.6--Special Aspects of Contracting for Lease Alterations

570.601  General.
570.602  Alterations by the lessor.
570.602-1  Justification and approval requirements.
570.602-2  Procedures.
570.603  Alterations by the Government.

       Subpart 570.7--Solicitation Provisions and Contract Clauses

570.701  FAR provisions and clauses.
570.702  Solicitation provisions.
570.703  Contract clauses.
570.704  Use of provisions and clauses.

  Subpart 570.8--Forms Used for Contracting for Leasehold Interests in 
                              Real Property

570.801  Standard forms.
570.802  GSA forms.

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

    Source:  54 FR 26585, June 23, 1989, unless otherwise noted.



                         Subpart 570.1--General



570.101  Applicability.

    (a) This part does not apply to the acquisition of leasehold 
interests in real property by the power of eminent domain, or by 
donation, or to the acquisition of leasehold interests in bare or 
unimproved land.
    (b) Other parts of the GSAR apply to the acquisition of leasehold 
interests in real property only to the extent specified in this part and 
501.103(b).



570.102  Definitions.

    Acquisition means the acquiring by lease with appropriated funds of 
an interest in improved real property for use by the Federal Government 
whether the space is already in existence or must be constructed. 
Acquisition begins at the point when agency needs are established and 
includes the description of requirements to satisfy agency needs, market 
survey, solicitation, award of lease, lease performance,

[[Page 477]]

lease administration, and those technical and management functions 
directly related to the process of fulfilling agency space needs by 
contract.
    Contract means lease.
    Contractor means lessor.
    Landlord or lessor means any individual, firm, partnership, trust, 
association, state or local government, or other legal entity that 
leases real property to the Government.
    Lease or leasehold interest in real property means a conveyance to 
the Government of the right of exclusive possession of real property for 
a definite period of time by a landlord. It may include services 
provided by the landlord such as heating, ventilation, air conditioning, 
utilities, custodial services, and other related services furnished by 
the landlord.
    Lessee or tenant means the United States of America.
    Rent and related services means the consideration paid for the use 
of leased property plus the costs of operational services such as heat, 
light, and janitor services whether furnished by the lessor, the 
Government, or both.
    Simplified lease acquisition threshold means $100,000 average annual 
rent, excluding the cost of operational services, such as heat, light, 
and janitorial services, whether furnished by the lessor, the 
government, or both, for the term of the lease, including option 
periods.
    Small business means a concern including affiliates, which is 
organized for profit, is independently-owned and operated, is not 
dominant in the field of leasing commercial real estate, and has annual 
average gross receipts of $15 million or less for the preceding three 
fiscal years.
    Solicitation for Offers (SFO) means invitation for bids in sealed 
bidding or request for proposals in negotiations.
    Space in buildings means the premises leased, or to be leased, 
including improvements. Its quantity is normally expressed in terms of 
square feet. It does not include space acquired by the power of eminent 
domain, donation, or condemnation or acquisitions of bare or unimproved 
land.
    Substantially as follows or substantially the same as, when used in 
the prescription of a provision or clause, means that authorization is 
granted to prepare and utilize a variation of that provision or clause 
to accommodate requirements that are peculiar to an individual 
acquisition, provided that the variation includes the salient features 
of the FAR/GSAR provision or clause, and is not inconsistent with the 
intent, principle, and substance of the FAR/GSAR provision or clause or 
related coverage on the subject matter.
[54 FR 26585, June 23, 1989, as amended at 60 FR 19363, Apr. 18, 1995; 
60 FR 42796, Aug. 17, 1995]



570.103  Authority to lease.

    The Federal Property and Administrative Services Act of 1949 (40 
U.S.C. 490(h)(1)), as amended, and Section 1 of the Reorganization Plan 
No. 18 of 1950 (40 U.S.C. 490 Note) authorize the Administrator of 
General Services to acquire leasehold interests in real property for use 
by Federal agencies. The authority is limited to leases for buildings 
and improvements that do not bind the Government for periods in excess 
of 20 years.



570.104  Contracting officers.

    Contracting officers, acting within the scope of their appointments, 
are the exclusive agents to enter into and administer leases on behalf 
of the Government in accordance with agency procedures.
[60 FR 42796, Aug. 17, 1995]



570.105  Competition.

    Unless the simplified procedures in subpart 570.2 are used, the 
competition requirements of FAR part 6 and part 506 apply to the 
acquisition of leasehold interests in real property.
[60 FR 42796, Aug. 17, 1995]



570.106  Methods of contracting.

    (a) The use of sealed bidding to acquire space in buildings is 
generally not feasible, unless a building site has been preselected and 
a building is to be constructed on the site in accordance with 
Government furnished plans and specifications for lease to the 
Government. When using sealed bidding, see the procedures in FAR Part 14 
and Part 514.

[[Page 478]]

    (b) The negotiated method is normally the best suited for acquiring 
space in buildings through a lease contract because it is necessary to 
conduct discussions with offerors about their proposals and factors 
other than price must be considered in making the award.
    (c) Unless another acquisition procedure authorized by law is used, 
the design-build selection procedures in section 303M of the Federal 
Property and Administrative Services Act of 1949, as amended, shall be 
used for lease construction projects, including projects with options to 
purchase the real property leased. The design-build selection procedures 
in section 303M shall be used when the lease involves the design and 
construction of a public building, facility or work for lease to the 
Government when the contracting officer determines that this method is 
appropriate, based on the following:
    (1) Three or more offers are anticipated;
    (2) A substantial amount of design work will be performed by 
offerors, that may result in offerors incurring substantial expenses in 
preparing offers; and
    (3) Criteria, such as the following, have been considered:
    (i) The extent to which the project requirements have been 
adequately defined;
    (ii) The time constraints for delivery of the project;
    (iii) The capability and experience of potential contractors;
    (iv) The suitability of the project for use of the two-phase 
selection procedures;
    (v) The capability of the agency to manage the two-phase selection 
process; and
    (vi) Other criteria established by the head of the contracting 
activity.
[54 FR 26585, June 23, 1989, as amended at 61 FR 24721, May 16, 1996; 62 
FR 5166, Feb. 4, 1997]



         Subpart 570.2--Simplified Lease Acquisition Procedures

    Source:  60 FR 42796, Aug. 17, 1995, unless otherwise noted.



570.201  Definitions.

    Simplified lease acquisition procedures mean the procedures 
described in this subpart for awarding leases at or below the simplified 
lease acquisition threshold of $100,000, including options.



570.202  Purpose.

    The purpose of this subpart is to prescribe simplified procedures 
for small leases in order to reduce administrative costs while providing 
for the efficient and economical acquisition of leasehold interests in 
real property.



570.203  Policy.

    Simplified lease acquisition procedures should be used to the 
maximum extent practicable for actions at or below the simplified lease 
acquisition threshold.



570.204  Procedures.



570.204-1  Market survey.

    A market survey must be conducted to identify potential sources. The 
contracting officer may use information available within GSA or from 
other available sources to identify locations that will meet the 
Government's minimum requirements.



570.204-2  Competition.

    (a) When the lease is not expected to exceed the simplified lease 
acquisition threshold, the solicitation of at least three sources is 
considered to promote competition to the maximum extent practicable. 
When repeated requirements for space occur in the same market, and if 
practicable, two sources not included in the most recent solicitation 
should be invited to submit offers.
    (b) If only one source is solicited, the file must be documented 
with an explanation for the lack of competition.



570.204-3  Soliciting offers.

    (a) Offers should be solicited by presenting each prospective 
offeror with a proposed short form lease or SFO which identifies all 
minimum requirements, all award factors, including price or cost, and 
any significant subfactors that will be considered in awarding the lease 
and which states

[[Page 479]]

the relative importance the Government places on the evaluation factors 
or subfactors. In describing the evaluation factors to be considered, 
the solicitation shall clearly disclose whether all evaluation factors 
other than cost or price when combined, are significantly more important 
than cost or price; approximately equal in importance to cost or price; 
or significantly less important than cost or price.
    (b) The proposed lease or SFO must describe the Government's 
requirements and include, either in full text or by reference, 
applicable FAR provisions and contract clauses required by 570.701 and 
applicable GSAR provisions and clauses required by 570.702 and 570.703.
    (c) To the extent necessary, the Government's requirements, pricing 
matters, evaluation procedures and submission of offers should be 
reviewed with prospective offerors.



570.204-4  Negotiation, evaluation, and award.

    (a) Negotiations, if applicable, should be conducted in accordance 
with 570.305.
    (b) Offers must be evaluated in accordance with the solicitation. 
The contracting officer shall evaluate the price and document the lease 
file to demonstrate that the proposed contract prices represent fair and 
reasonable prices. In cases where the total cost exceeds $500,000, cost 
and pricing data must be obtained unless the requirement is waived or 
one of the exemptions at FAR 15.804-2 applies. The market price 
exemption from submission of cost or pricing data may be applied to 
proposed leases where there is evidence that the price is based on an 
established market price for similar space leased to the general public. 
A market survey and/or an appraisal conducted in accordance with 
accepted real property appraisal procedures may be used as evidence to 
establish the market price.
    (c) An acceptable small business subcontracting plan must be 
provided if the total contract value of the lease will exceed $500,000, 
unless the lease will be awarded to a small business concern.
    (d) For leases expected to exceed $100,000, a Certificate of 
Procurement Integrity must be provided to the proposed successful 
offeror for completion and submission before award.
    (e) The contracting officer should review the List of Parties 
Excluded from Federal Procurement and Nonprocurement Programs, to ensure 
the proposed awardee is eligible to receive the award and is otherwise 
responsible before awarding the lease.
    (f) An award will be made to the responsible offeror whose proposal 
is most advantageous to the Government considering price and other 
factors included in the solicitation.



570.204-5  Inspection.

    The space must be inspected to ensure that it is in substantial 
compliance with the Government's requirements and specifications before 
acceptance by the contracting officer. The contract file must be 
documented accordingly.



  Subpart 570.3--Procedures for Contracting for Leasehold Interests in 
                              Real Property

    Source:  60 FR 42797, Aug. 17, 1995, unless otherwise noted.



570.301  Market surveys.

    A market survey must be conducted to identify potential sources. The 
contracting officer may use information available within GSA or from 
other available sources to identify locations that will meet the 
Government's minimum requirements.



570.302  Publicizing/Advertising.

    (a) Leasing actions for blocks of space of more than 10,000 square 
feet must be publicized in local newspapers and may also be posted on an 
on-line information system, unless exempt under FAR 5.202 or 505.202.
    (b) When the Government intends to acquire a leasehold interest in a 
building to be constructed on a preselected site, the proposed 
acquisition must be synopsized in the Commerce Business Daily (CBD).

[[Page 480]]



570.303  Solicitation for offers (SFO).

    (a) The SFO is the basis for the entire lease negotiation process 
and must be made a part of the lease. SFO's must contain the information 
necessary to enable the prospective offeror to prepare a proposal. Each 
SFO, at a minimum, must--
    (1) Be in writing.
    (2) Contain a description of the minimum requirements of the 
Government, including--
    (i) A description of the required space.
    (ii) Specifications. The type of specification will depend upon the 
nature of the space needed by the agency and the market available to 
satisfy the need. Specifications may be stated in terms of function, 
performance, or design requirements. The specification must be drafted 
to promote full and open competition and include restrictive provisions 
or conditions only to the extent necessary to satisfy the needs of the 
agency or as authorized by law.
    (iii) Any special requirements.
    (iv) A delivery schedule.
    (3) State the method to be used to measure space.
    (4) Specify a date and place for the submission of offers.
    (5) Indicate how offers will be evaluated.
    (6) Indicate how offers are to be structured.
    (7) Describe the source selection procedures to be used.
    (i) Unless the design-build selection procedures are being used as 
authorized by 570.106(c), the solicitation must either:
    (A) State that award will be made to the offeror that meets the 
SFO's minimum requirements at the lowest cost or price, or
    (B) Identify all factors, including price or cost, and any 
significant subfactors that will be considered in awarding the lease and 
state the relative importance the Government places on those evaluation 
factors and subfactors. In describing the evaluation factors to be 
considered, the SFO shall clearly disclose whether all evaluation 
factors other than cost or price when combined, are significantly more 
important than cost or price, approximately equal in importance to cost 
or price, or significantly less important than cost or price. Numerical 
weights, which may be employed in the evaluation of proposals, need not 
be disclosed in the solicitation. The SFO must inform offerors of 
minimum requirements that apply to the procurement. The other factors 
that will be considered in evaluating proposals should be tailored to 
each acquisition and include only those factors that will have an impact 
on the award decision. The evaluation factors that apply to an 
acquisition and the relative importance of those factors are within the 
broad discretion of the contracting officer. However, price or cost to 
the Government must be included as an evaluation factor in every case.
    (ii) When the design-build selection procedures are being used as 
authorized by 570.106(c), the solicitation must
    (A) Identify the evaluation factors and subfactors to be used in 
evaluating phase-one proposals and indicate their relative importance,
    (B) State the maximum number of offerors that are to be selected to 
submit competitive proposals in phase-two, and
    (C) Identify the evaluation factors and subfactors, including cost 
or price, to be used in evaluating phase-two proposals and selecting the 
successful offeror. Evaluation factors to be used in evaluating phase-
one proposals must be stated in the solicitation. Phase-one factors 
include specialized experience and technical competence, capability to 
perform, past performance of the offeror's team (including the 
architect-engineer and construction members of the team) and other 
appropriate factors, such as site or location. In phase-one, offerors 
will not be required to submit detailed design information or cost or 
price information and use of cost related or price related evaluation 
factors is not permitted. The maximum number of offerors to be selected 
for phase-two must not exceed 5 unless the contracting officer 
determines that specifying a number greater than 5 is in the 
Government's interest and is consistent with the purpose and objectives 
of the two-phase selection process. For phase-two the solicitation 
should identify all factors, including

[[Page 481]]

price or cost, and any significant subfactors that will be considered in 
awarding the lease and state the relative importance the Government 
places on those evaluation factors and subfactors and otherwise comply 
with paragraph (a)(7)(i) of this section.
    (8) Include a statement outlining the information that may be 
disclosed in post-award debriefings.
    (9) Include appropriate forms as prescribed in subpart 570.8.
    (b) The SFO must be released to all prospective offerors at the same 
time.
[60 FR 42797, Aug. 17, 1995, as amended at 61 FR 24721, May 16, 1996]



570.304  Changes to SFO's.

    (a) When the Government's requirements change (either before or 
after receipt of proposals), the SFO must be amended in writing.
    (b) When time is of the essence, information on SFO amendments may 
be provided orally if--
    (1) A record is made of the information provided;
    (2) All offerors or prospective offerors are given notice, or 
attempts to provide offerors or prospective offerors with such notice 
are made, on the same day, if possible; and
    (3) The information provided orally is promptly confirmed by a 
written amendment.
    (c) When amendments to the Government's requirements occur, the 
following procedures apply--
    (1) If proposals have not been submitted, amendments must be sent to 
all prospective offerors who have been sent a copy of the SFO.
    (2) If proposals have been received, the amendments must be sent to 
all of the offerors.
    (3) If an amendment is so substantial that it requires a complete 
revision of the SFO, the SFO should be concealed and a new SFO issued.



570.305  Negotiations.

    (a) Negotiations will be conducted with all offerors that are within 
the competitive range. The contracting officer shall determine the 
competitive range on the basis of cost and other factors that were 
stated in the SFO and shall include in the competitive range all offers 
that have a reasonable chance of being selected for award.
    (b) The content and extent of the negotiations are a matter of the 
contracting officer's judgment based on the particular facts of each 
acquisition. The contracting officer shall--
    (1) Control all discussions;
    (2) Advise offerors of deficiencies in their proposals so that 
offerors are given an opportunity to satisfy the Government's 
requirements; attempt to resolve any uncertainties concerning the 
proposals; resolve any suspected mistakes by calling them to the 
offeror's attention as specifically as possible without disclosing 
information concerning other offerors' proposals or the evaluation 
process; and
    (3) Provide offerors a reasonable opportunity to submit any cost or 
price, technical, or other revisions to their proposals that may result 
from the discussions.
    (c) No indication may be given to any offeror of a target price 
which must be met.
    (d) No information regarding the number or identity of offerors 
participating in the procurement may be made available to anyone whose 
official duties do not require such knowledge.
    (e) Negotiations must be closed by establishing a date and time for 
closing of negotiations and requesting in writing that offerors submit a 
``best and final offer'' by that date.
    (f) Negotiations may not be conducted after the closing date for 
best and final offers unless negotiations are reopened with all offerors 
in the competitive range.
    (g) Negotiations are confidential and must reflect complete 
agreement on all items and conditions of the lease contract. Information 
regarding the transaction will not be announced or made available until 
after the contract is awarded.
    (h) A written negotiation record must be placed in the lease file.



570.306  Evaluating offers.

    (a) An abstract of final offers may be prepared to aid in the 
analysis of offers received.
    (b) Offers must be evaluated in accordance with the SFO.

[[Page 482]]



570.307  Late offers, modifications of offers, and withdrawals of offers.

    Offers determined to be received late will be handled in accordance 
with FAR 15.412.



570.308  Preaward requirements.



570.308-1  General.

    (a) If an offeror answers affirmatively on the Contingent Fee 
Representation and Agreement, in order to comply with the warranty 
requirement of 41 U.S.C. 254(a), the requirements of FAR 3.4 and 503.4 
must be followed for leasing actions expected to exceed the simplified 
lease acquisition threshold.
    (b) For leases expected to exceed $100,000, a Certificate of 
Procurement Integrity must be provided to the proposed successful 
offeror for completion and submission before award.
    (c) Other applicable certifications should be reviewed for 
compliance with regulations.



570.308-2  Cost or pricing data.

    (a) Cost or pricing data are required under the circumstances 
described in FAR 15.804-2.
    (b) The exemptions from and waivers of submission of certified cost 
or pricing data are outlined in FAR 15.804-3. The competition exemption 
applies when adequate price competition, as defined in FAR 15.804-3(b), 
is obtained. The market price exemption from submission of cost or 
pricing data may be applied to proposed leases where there is evidence 
that the price is based on an established market price for similar space 
leased to the general public. A market survey and/or an appraisal 
conducted in accordance with accepted real property appraisal procedures 
may be used as evidence to establish the market price. The contracting 
officer may grant an exemption and need not require the prospective 
lessor to submit a Standard Form 1412, Claim for Exemption from 
Submission of Certified Cost or Pricing Data, when there is evidence, 
before solicitation, that there is an acceptable established market 
price (see FAR 15.804-3(e)(3)).
    (c) In exceptional cases, the requirement for submission of 
certified cost or pricing data may be waived under FAR 15.804-3(i).
    (d) When certified cost or pricing data is required, the contracting 
officer shall follow the procedural requirements in FAR 15.804-6(e).
    (e) If the proposed lessor refuses to provide data when required, 
the contracting officer shall follow the procedures in FAR 15.804-6(e).
[60 FR 42797, Aug. 17, 1995, as amended at 61 FR 6173, Feb. 16, 1996; 62 
FR 44525, Aug. 21, 1997]



570.308-3  Proposal evaluation.

    (a) Offers must be evaluated in accordance with the solicitation. 
The contracting officer shall evaluate the price and document the lease 
file to demonstrate that the proposed contract prices represent fair and 
reasonable prices.
    (b) The lease file must also document the evaluation of other award 
factors listed in the solicitation. The file must include the basis for 
evaluation, an analysis of each offer, and a summary of findings.



570.308-4  Responsibility determinations.

    (a) The contracting officer shall make a determination that the 
prospective awardee is responsible with respect to the lease being 
considered. The contracting officer's signature on the contract is 
deemed to be an affirmative determination. When an offeror is found to 
be nonresponsible, the contracting officer shall make, sign and place in 
the contract file a determination of nonresponsibility which shall state 
the basis for the determination.
    (b) If a small business concern is found to be nonresponsible, the 
procedures at FAR 19.6 and 519.6 must be followed. All documents and 
reports supporting a determination of responsibility or 
nonresponsibility must be placed in the lease file.



570.309  Award.

    (a) An award will be made to the responsible offeror whose proposal 
is most advantageous to the Government considering price and other 
factors included in the SFO.
    (b) Award will be made in writing within the timeframe specified in 
the SFO. If an award cannot be made within that time, the contracting 
officer

[[Page 483]]

shall request in writing from each offeror an extension of the 
acceptance period through a specific date.
    (c) Unsuccessful offerors will be notified in writing or 
electronically within three days after the award. The first day of the 
three-day period is the day following award; if the third day is not a 
full contracting activity workday, the third day will be the next full 
contracting activity workday.
    (d) All proposals received in response to an SFO may be rejected if 
the head of the contracting activity or designee determines that such 
action is in the public interest.



570.310  Debriefings.

    (a) Unsuccessful offerors may request a debriefing by the agency, 
provided that said request is made in writing and is received by the 
agency within 3 days after the date on which the offeror received notice 
of the contract award.
    (b) The agency shall debrief the offeror to the maximum extent 
practicable within 5 days after the request for the debriefing.
    (c) The debriefing shall include, at a minimum:
    (1) The agency's evaluation of the significant weak or deficient 
factors in the offeror's proposal;
    (2) The overall evaluated cost and technical rating of the 
successful offeror's proposal and the proposal of the offeror requesting 
the debriefing;
    (3) The overall ranking of all offers;
    (4) A summary of the rationale for the award;
    (5) Reasonable responses to relevant questions posed by the 
debriefed offeror as to whether source selection procedures set forth in 
the SFO, applicable regulations and other applicable authorities were 
followed.
    (6) A summary of the debriefing shall be maintained in the contract 
file.
    (d) The debriefing may not include point-by-point comparisons of the 
debriefed offeror's proposal with other proposals and may not disclose 
any information that is exempt from disclosure.



570.311  Inspection.

    The space must be inspected to ensure that it is in substantial 
compliance with the Government's requirements and specifications before 
acceptance by the contracting officer. The contract file must be 
documented accordingly.



             Subpart 570.4--Mistakes, Protest, Miscellaneous



570.401  Disclosure of mistakes after award.

    When a mistake in a lessor's offer is not discovered until after 
award, the mistake should be handled as provided in FAR 14.406-4 and 
Subpart 514.4.



570.402  Protests.

    Protests regarding the award of lease contracts are handled as 
provided in FAR Subpart 33.1 and Subpart 533.1.



570.403  Awards to Federal employees.

    Offers from officers or employees of the Government must be handled 
as provided in FAR 3.6 and 503.6.



   Subpart 570.5--Special Aspects of Contracting for Continued Space 
                              Requirements



570.501  Renewal options.

    (a) Exercise of options. Before exercising an option, the provisions 
of Part 517 must be followed.
    (b) Notification. When a contracting officer determines that it is 
in the best interest of the Government to continue to lease a property, 
the lessor must be notified within the timeframe required by the lease.
    (c) Market survey. When the right to renew a lease exists, a renewal 
must be based on a market survey and other applicable considerations. 
Surveys should focus on the prevailing rental rates for comparable 
space.
[54 FR 26585, June 23, 1989, as amended at 55 FR 11588, Mar. 29, 1990; 
60 FR 19363, Apr. 18, 1995]



570.502  Succeeding leases.

    (a) General. Succeeding leases for the continued occupancy of space 
in a building which do not exceed the simplified lease acquisition 
threshold may be acquired through use of the simplified procedures 
outlined in subpart 570.2. Absence of competition must be

[[Page 484]]

explained in the contract file. Succeeding leases which exceed the 
simplified lease acquisition threshold may be entered into when a cost-
benefit analysis has been conducted and the results indicate that an 
award to an offeror other than the present lessor would result in 
substantial relocation costs and duplication of costs to the Government 
that are not expected to be recovered through competition.
    (b) Procedure--(1) Publicizing/Advertising. The contracting officer 
shall publish a notice in local newspapers and/or periodicals if 
required by 505.101(c). The notice should normally (i) indicate the 
Government's lease is expiring, (ii) describe the requirement in terms 
of type and quantity of space, (iii) indicate the Government is 
interested in considering alternative space if economically 
advantageous, (iv) advise prospective offerors that the Government will 
consider the cost of moving, alterations, etc., when deciding whether it 
should relocate, and (v) provide a contact person for those interested 
in providing space to the Government.
    (2) Market survey. A market survey must be conducted in accordance 
with 570.301.
    (3) Competition determination. (i) If no potential acceptable 
locations are identified through the advertisement or the market survey, 
the contracting officer may prepare a justification to negotiate 
directly with the present lessor. The justification must be prepared and 
approved in accordance with FAR subpart 6.3 and subpart 506.3, and 
should fully document the efforts to locate alternative sources.
    (ii) If potential acceptable locations are identified through the 
advertisement or market survey and relocation costs (including estimated 
moving costs, telecommunications costs, and the estimated cost of 
alterations, amortized over the firm term of the lease) will be low 
enough to allow recovery through a competitive process, the contracting 
officer should develop a SFO and negotiate with all interested parties 
in accordance with the procedures in subpart 570.3.
    (iii) If potential acceptable locations are identified through the 
advertisement or market survey and substantial relocation costs are 
involved, the contracting officer shall conduct a cost-benefit analysis 
to determine whether the duplication of costs to the Government could be 
recovered through competition. The cost-benefit analysis must give 
consideration to the prices of other potentially available properties, 
relocation costs, and other appropriate considerations. The prices for 
other potentially available properties must be established by requesting 
the prospective offeror to provide an informational quotation for 
standard space for comparison purposes. The prices quoted for standard 
space will be adjusted by the Government for special requirements. A 
formal solicitation for offers (SFO) is not required for the purpose of 
obtaining the informational quotation. The contracting officer shall 
provide a general description of the Government's needs when requesting 
informational quotations. If oral quotations are provided, the record 
must be documented to reflect the following information, as a minimum: 
the name and address of the firm solicited, the name of the firm's 
representative providing the quote, the price(s) quote, the description 
of the space and services for which the quote is provided, the name of 
the Government employee soliciting the quotation, and the date of the 
conversation. The informational quotations must be compared to the 
present lessor's price, adjusted to reflect the anticipated price for a 
succeeding lease. Based on the results of the cost-benefit analysis, the 
contracting officer will:
    (A) Prepare a justification for approval in accordance with FAR 
Subpart 6.3 and Subpart 506.3 to support the determination to negotiate 
with the present lessor for continued occupancy because it is likely 
that award to any other offeror would result in substantial duplication 
of costs to the Government that are not expected to be recovered through 
competition; or
    (B) Develop an SFO and negotiate with all interested parties in 
accordance with the procedures in subpart 570.3.
[54 FR 26585, June 23, 1989, as amended at 57 FR 37897, Aug. 21, 1992; 
60 FR 42799, Aug. 17, 1995]

[[Page 485]]



570.503  Expansion requests.

    (a) When the expansion space is within the general scope of the 
lease, the space may be acquired through a modification to the lease 
without further justification pursuant to FAR subpart 6.3.
    (b) When the expansion space needed is outside the general scope of 
the lease, the contracting officer must determine whether it is more 
prudent to provide the expansion space by supplemental agreement to the 
existing lease or to satisfy the requirement by competitive means. A 
market survey must be conducted to determine whether suitable 
alternative locations are available. If the market survey reveals 
alternate locations that can satisfy the total requirement, a cost-
benefit analysis must be performed to determine whether it is in the 
Government's best interest to relocate. This analysis may include--
    (1) The cost of the alternate space compared to the cost of 
expanding at the existing location;
    (2) The cost of moving;
    (3) The cost of duplicating existing improvements;
    (4) The cost of the unexpired portion of the firm lease term (unless 
a termination is possible, in which case the actual cost of such an 
action should be used); and
    (5) The cost of disruption to the agency's operation.
    (c) When the expansion space is outside the general scope of the 
lease, a justification must be prepared for approval in accordance with 
FAR subpart 6.3 and 506.3, except when competitive procedures or 
simplified lease acquisition procedures are used.
[54 FR 26585, June 23, 1989, as amended at 57 FR 37897, Aug. 21, 1992; 
60 FR 42799, Aug. 17, 1995]



570.504  Superseding leases.

    (a) Consideration should be given to the execution of a superseding 
lease that would replace the existing lease when the changes or 
modifications to the space contemplated are so numerous or detailed as 
to cause complications, or they would substantially change the present 
lease.
    (b) The justification and approval requirements in FAR subpart 6.3 
and 506.3 must be complied with before negotiating a superseding lease 
if the value of the lease exceeds the simplified lease acquisition 
threshold. When the cost is less than or equal to the simplified lease 
acquisition threshold, the contracting officer may use simplified 
procedures outlined in 570.2 and explain the absence of competition in 
the file.
[60 FR 42800, Aug. 17, 1995]



570.505  Lease extensions.

    (a) The justification and approval requirements in FAR subpart 6.3 
and 506.3 must be complied with before negotiating a Supplemental Lease 
Agreement exceeding the simplified lease acquisition threshold to extend 
the term of the lease to provide for continued occupancy on a short term 
basis (usually not to exceed 1 year). For extensions valued less than or 
equal to the simplified lease acquisition threshold, the contracting 
officer must explain the absence of competition in the contract file.
    (b) FAR 6.302-1 provides for contracting without providing for full 
and open competition when the property or services needed by the agency 
are available from only one responsible source and no other type of 
property or services will satisfy the needs of the agency. This 
authority may be used to extend the term of a lease by supplemental 
agreement in situations such as the following:
    (1) When the agency occupying the leased space is scheduled to move 
into other Federally controlled space but unexpected delays are 
encountered in preparing the new space for occupancy.
    (2) When unexpected delays which are outside of GSA's control (i.e., 
protests, etc.) are encountered in acquiring replacement space.
    (3) When various agencies occupying leased space are being 
consolidated and it is necessary to extend the terms of some leases to 
establish a common expiration date.
[54 FR 26585, June 23, 1989, as amended at 60 FR 42800, Aug. 17, 1995]

[[Page 486]]



   Subpart 570.6--Special Aspects of Contracting for Lease Alterations



570.601  General.

    (a) Although the Government generally has a contractual right to 
alter the space leased, normally most alterations are acquired through a 
modification to the lease because they fall within the general scope of 
the lease and it is in the Government's interest to acquire the 
alterations from the lessor.
    (b) As the need for alterations arise during the term of a lease 
contract, the contracting officer must examine each project and make a 
determination as to whether the alterations fall within the general 
scope of the lease and may be acquired through a modification to the 
lease. The primary test is whether the work can be regarded as fairly 
and reasonably an inseparable part of the lease requirement originally 
contracted for. If the alterations are outside the general scope, the 
contracting officer must make a decision to acquire the alterations 
through a separate contract, through a Supplemental Lease Agreement, or 
to request the work be performed by Federal employees.



570.602  Alterations by the lessor.



570.602-1  Justification and approval requirements.

    (a) The justification and approval requirements in FAR Subpart 6.3 
and 506.3 must be complied with before negotiating directly with the 
lessor for any alteration project exceeding $100,000 that is outside the 
general scope of the lease contract.
    (b) Before negotiating directly with the lessor for any alteration 
project of $100,000 or less, that is outside the general scope of the 
lease, the contracting officer shall document, in writing, the reasons 
for the absence of competition.
[54 FR 26585, June 23, 1989, as amended at 60 FR 42800, Aug. 17, 1995]



570.602-2  Procedures.

    (a) Scope of work. A scope of work must be prepared for all 
alteration projects.
    (b) Independent Government estimate. An independent Government 
estimate must be prepared for all alteration projects, including changes 
to alteration agreements with lessors.
    (c) Request for proposal. (1) The lessor must be provided with a 
scope of work, including any plans and specifications which have been 
developed, and should be requested to submit a proposal. The request for 
proposal should indicate whether progress payments will be made and 
provide for retainage, when appropriate.
    (2) The proposal must be requested to be submitted in such detail 
that a cost or price analysis can be made.
    (3) The requirements for the submission of certified cost or pricing 
data outlined in FAR 15.804-2 apply to alteration projects over 
$500,000. The procedural requirements at FAR 15.804-6 must be followed 
when requesting cost and pricing data. Exemptions from or waivers to 
submission of certified cost or pricing data must be processed in 
accordance with the requirements of FAR 15.804-3. If the lease does not 
include the clauses at FAR 52.215-22 and 52.215-24 or the clauses at FAR 
52.215-23 and 52.215-25, the modification to the lease for the 
alterations must add the clauses at FAR 52.215-23 and 52.215-25 if cost 
and pricing data is submitted.
    (d) Audits. Unless the cost or pricing data requirement is exempt or 
waived in accordance with FAR 15.804-3, an audit must be requested for 
negotiated alteration projects which are not competed as a part of the 
lease and exceed $500,000.
    (e) Evaluation of proposals. The contracting officer shall:
    (1) Determine whether the proposal will meet the Government's 
requirements;
    (2) Analyze cost as compared to the independent estimate and the 
audit;
    (3) Analyze profit in accordance with FAR Subpart 15.9 if the 
project exceeds $100,000; and
    (4) Document analysis leading to negotiation objectives developed 
from paragraphs (e) (1) through (3) of this section.
    (f) Price negotiations. (1) The contracting officer is responsible 
for exercising sound judgment and may make reasonable compromises as 
necessary.

[[Page 487]]

    (2) The negotiated price should provide the lessor with the greatest 
incentive for efficient and economical performance.
    (3) Negotiations must be documented by a price negotiation 
memorandum prepared in accordance with FAR 15.808(a).
    (g) Award. Alterations may be procured using the GSA Form 276, 
Supplemental Lease Agreement, or the GSA Form 300, Order for Supplies or 
Services (alteration project of $100,000 or less) provided a reference 
is made to the lease.
    (h) Inspection and payment. Final payment for alterations must not 
be made until the work is:
    (1) Inspected by a qualified Government employee or independent 
Government contractor; and
    (2) Certified as completed in a satisfactory manner.
[54 FR 26585, June 23, 1989, as amended at 57 FR 37897, Aug. 21, 1992; 
60 FR 19363, Apr. 18, 1995; 60 FR 42800, Aug. 17, 1995; 61 FR 6173, Feb. 
16, 1996]



570.603  Alterations by the Government.

    When the Government elects to exercise its rights to make the 
alterations rather than contract directly with the lessor, the work may 
be performed by Federal employees or may be contracted out using all of 
the standard contracting procedures that would apply to a construction 
contract if the work were to be performed on Federal property. If the 
Government decides to contract for the work, the lessor, as well as all 
other prospective contractors, should be invited to submit an offer for 
the project.



       Subpart 570.7--Solicitation Provisions and Contract Clauses

    Source:  60 FR 42800, Aug. 17, 1995, unless otherwise noted.



570.701  FAR provisions and clauses.

    In addition to including solicitation provisions and contract 
clauses prescribed in the GSAR (48 CFR chapter 5), provisions and/or 
clauses substantially the same as the FAR provisions/clauses listed, 
shall be included in the circumstances indicated.
    (a) All solicitations and contracts, regardless of the dollar value, 
must include the following provisions/clauses:

                                                                        
------------------------------------------------------------------------
 FAR part                                                               
  52 cite                               Title                           
------------------------------------------------------------------------
52.204-3..  Taxpayer Identification.                                    
52.233-1..  Disputes.                                                   
------------------------------------------------------------------------

    (b) All solicitations and contracts which exceed $1,000 must include 
the FAR clause at 52.232-23, Assignment of Claims.
    (c) All solicitations and contracts which exceed $2,500 must include 
the following provisions/clauses:

                                                                        
------------------------------------------------------------------------
 FAR part                                                               
  52 cite                               Title                           
------------------------------------------------------------------------
52.219-2..  Small Disadvantaged Business Concern Representation.        
52.219-3..  Women-Owned Small Business Representation.                  
52.222-36.  Affirmative Action for Handicapped Workers.                 
------------------------------------------------------------------------

    (d) All solicitations and contracts which exceed $10,000 must 
include the following provisions/clauses:

                                                                        
------------------------------------------------------------------------
 FAR part                                                               
  52 cite                               Title                           
------------------------------------------------------------------------
52.222-21.  Certification of Nonsegregated Facilities.                  
52.222-22.  Previous Contracts and Compliance Reports.                  
52.222-25.  Affirmative Action Compliance.                              
52.222-26.  Equal Opportunity.                                          
52.222-35.  Affirmative Action for Special Disabled and Vietnam Era     
             Veterans.                                                  
52.222-37.  Employment Reports on Special Disabled Veterans and Veterans
             of the Vietnam Era.                                        
------------------------------------------------------------------------

    (e) All solicitations and contracts which exceed $25,000 must 
include the FAR clause at 52.209-6, Protecting the Government's 
Interests when Subcontracting with Contractors Debarred, Suspended, or 
Proposed for Debarment.
    (f) All solicitations and contracts which exceed $100,000 must 
include the following FAR provisions/clauses:

                                                                        
------------------------------------------------------------------------
 FAR part                                                               
  52 cite                               Title                           
------------------------------------------------------------------------
52.203-9..  Requirement for Certification of Procurement Integrity--    
             Modification.                                              
52.203-11.  Certificate and Disclosure Regarding Payments to Influence  
             Certain Federal Transactions.                              
------------------------------------------------------------------------

    (g) All solicitations and contracts for actions which exceed the 
simplified lease acquisition threshold must include the following FAR 
provisions/clauses:

[[Page 488]]



                                                                        
------------------------------------------------------------------------
 FAR part                                                               
  52 cite                               Title                           
------------------------------------------------------------------------
52.203-2..  Certificate of Independent Price Determination.             
52.203-7..  Anti-Kickback Procedures.                                   
52.209-5..  Certification Regarding Debarment, Suspension, Proposed     
             Debarment, and Other Responsibility Matters.               
52.215-1..  Examination of Records by Comptroller General.              
52.215-12.  Restriction on Disclosure and Use of Data (Solicitations    
             only).                                                     
52.219-8..  Utilization of Small Business Concerns and Small            
             Disadvantaged Business Concerns.                           
52.219-13.  Utilization of Women-Owned Small Businesses.                
52.223-5..  Certification Regarding a Drug-Free Workplace.              
52.233-2..  Service of Protest (Solicitations only).                    
------------------------------------------------------------------------

    (h) All solicitations and contracts which exceed $500,000 must 
include the deviations to the FAR clauses at 52.219-9, Small Business 
and Small Disadvantaged Business Subcontracting Plan, and 52.219-16, 
Liquidated Damages--Small Business Subcontracting Plan (see 519.708 (a) 
and (b)).
    (i) Solicitations which exceed $1 million must include the FAR 
provision at 52.222-24, Preaward On-site Equal Opportunity Compliance 
Review.
    (j) When cost or pricing data is required for work or service 
exceeding $500,000 the FAR clauses at 52.215-22, Price Reduction for 
Defective Cost or Pricing Data, and 52.215-24, Subcontractor Cost or 
Pricing Data, must be included in solicitations and contracts.
    (k) When the contracting officer determines that it is desirable to 
authorize the submission of facsimile proposals the solicitation must 
include the FAR provision at 52.215-18, Facsimile Proposals.



570.702  Solicitation provisions.

    When a solicitation for offers is issued, the contracting officer 
should include provisions substantially the same as the following unless 
the contracting officer makes a determination that use of one or more of 
the provisions is not appropriate:
    (a) 552.270-1  Preparation of Offers.
    (b) 552.270-2  Explanation to Prospective Offerors.
    (c) 552.270-3  Late Submissions, Modifications, and Withdrawals of 
Offers. Alternate I should be used when the contracting officer decides 
that it is advantageous to the Government to allow offers to be 
submitted up to the exact time specified for receipt of best and final 
offers.
    (d) 552.270-4  Historic Preference.
    (e) 552.270-5  Lease Award.
    (f) 552.270-6  Parties to Execute Lease.



570.703  Contract clauses.

    (a) The contracting officer shall insert the following clauses or 
clauses substantially the same as the following clauses in solicitations 
and contracts for leasehold interests in real property which exceed the 
simplified lease acquisition threshold unless the contracting officer 
makes a determination that use of one or more of the clauses is not 
appropriate. Use of the clauses is optional for those actions which fall 
at or below the simplified lease acquisition threshold.
    (1) 552.270-10  Definitions (Included if 552.270-28 is used).
    (2) 552.270-11  Subletting and Assignment.
    (3) 552.270-12  Maintenance of Building and Premises--Right of 
Entry.
    (4) 552.270-13  Fire and Casualty Damage.
    (5) 552.270-15  Compliance with Applicable Law.
    (6) 552.270-16  Inspection--Right of Entry.
    (7) 552.270-17  Failure in Performance.
    (8) 552.270-18  Successors Bound.
    (9) 552.270-19  Alterations.
    (10) 552.270-20  Proposals for Adjustment.
    (11) 552.270-21  Changes.
    (12) 552.270-25  Adjustment for Vacant Premises.
    (13) 552.270-27  Delivery and Condition.
    (14) 552.270-28  Default in delivery--Time Extensions.
    (15) 552.270-30  Progressive Occupancy.
    (16) 552.270-31  Payment.
    (17) 552.270-32  Effect of Acceptance and Occupancy.
    (18) 552.270-33  Default by Lessor During the Term.
    (19) 552.270-34  Subordination, Nondisturbance and Attornment.
    (20) 552.270-35  Statement of Lease.
    (21) 552.270-36  Substitution of Tenant Agency.
    (22) 552.270-37  No Waiver.

[[Page 489]]

    (23) 552.270-38  Integrated Agreement.
    (24) 552.270-39  Mutuality of Obligation
    (25) 552.270-40  Asbestos and Hazardous Waste Management.
    (26) 552.270-41  Acceptance of Space.
    (b) The contracting officer shall insert the clause at 552.270-22, 
Liquidated Damages, in solicitations and contracts for leasehold 
interests in real property when there is a critical requirement that the 
delivery date be met and an actual cost cannot be established for the 
loss to the Government resulting from late delivery.



570.704  Use of provisions and clauses.

    The omission of any provision or clause when its prescription 
requires its use constitutes a deviation which must be approved under 
subpart 501.4. Approval may be granted to deviate from provisions or 
clauses that are mandated by statute (e.g., (GSAR) 48 CFR 552.203-5, 
Covenant Against Contingent Fees, FAR 52.215-1, Examination of Records 
by the Comptroller General, etc.) in order to modify the language of the 
provision or clause, when permitted by the statute. However, the 
statutory provisions and clauses may not be omitted from the SFO unless 
the statute provides for waiving the requirements of the provision or 
clause.



  Subpart 570.8--Forms Used for Contracting for Leasehold Interests in 
                              Real Property



570.801  Standard forms.

    Standard Form 2, U.S. Government Lease for Real Property, should be 
used to award leases unless GSA Form 3626 is used. When the Standard 
Form 2 is used, reference to the Standard Form 2-A in paragraph 7 must 
be deleted.
[60 FR 42801, Aug. 17, 1995]



570.802  GSA forms.

    (a) The GSA Form 3626, U.S. Government Lease for Real Property 
(Short Form), may be used to award leases when the simplified leasing 
procedures in 570.2 are used or when the Contracting Officer finds its 
use to be advantageous.
    (b) GSA Form 276, Supplemental Lease Agreement, should be used to 
amend existing leases that involve the acquisition of additional space 
or partial release of space, revisions in the terms of a lease, 
restoration settlements, and alterations.
    (c) GSA Form 1364, Proposal To Lease Space to the United States of 
America, may be used to obtain offers from prospective offerors.
[60 FR 42801, Aug. 17, 1995]

      Appendix A to Chapter 5--Contracting Office Assignment Codes

    Note:  Appendix A is illustrated in and made a part of the GSAR 
loose-leaf edition. Appendix A is not illustrated in this volume of the 
Federal Register or Title 48, Chapter 5 of the Code of Federal 
Regulations.

[[Page 491]]



                     CHAPTER 6--DEPARTMENT OF STATE




                           (Parts 600 to 699)

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

                          SUBCHAPTER A--GENERAL
Part                                                                Page
601             Department of State acquisition regulations 
                    system..................................         493
602             Definitions of words and terms..............         499
603             Improper business practices and personal 
                    conflicts of interest...................         500
604             Administrative matters......................         502
           SUBCHAPTER B--COMPETITION AND ACQUISITION PLANNING
605             Publicizing contract actions................         505
606             Competition requirements....................         506
607             Acquisition planning........................         509
608             Required sources of supplies and services...         509
609             Contractor qualifications...................         509
610             Specifications, standards, and other 
                    purchase descriptions...................         512
          SUBCHAPTER C--CONTRACTING METHODS AND CONTRACT TYPES
613             Simplified acquisition procedures...........         515
614             Sealed bidding..............................         516
615             Contracting by negotiation..................         517
616             Types of contracts..........................         519
617             Special contracting methods.................         520
                  SUBCHAPTER D--SOCIOECONOMIC PROGRAMS
619             Small business and small disadvantaged 
                    business concerns.......................         523
622             Application of labor laws to government 
                    acquisitions............................         526
623             Environment, conservation, occupational 
                    safety, and drug-free workplace.........         528
624             Protection of privacy and freedom of 
                    information.............................         532

[[Page 492]]

625             Foreign acquisition.........................         533
             SUBCHAPTER E--GENERAL CONTRACTING REQUIREMENTS
627             Patents, data, and copyrights...............         535
628             Bonds and insurance.........................         535
629             Taxes.......................................         537
630             Cost accounting standards...................         538
631             Contract cost principles and procedures.....         538
632             Contract financing..........................         538
633             Protests, disputes, and appeals.............         539
             SUBCHAPTER F--SPECIAL CATEGORIES OF CONTRACTING
634             Major system acquisition....................         545
636             Construction and architect-engineer 
                    contracts...............................         546
637             Service contracting.........................         546
639             Acquisition of information resources........         547
                    SUBCHAPTER G--CONTRACT MANAGEMENT
642             Contract administration.....................         548
643             Contract modifications......................         548
645             Government property.........................         549
646             Quality assurance...........................         549
647             Transportation..............................         549
648             Value engineering...........................         549
649             Termination of contracts....................         550
651             Use of government sources by contractors....         550
                     SUBCHAPTER H--CLAUSES AND FORMS
652             Solicitation provisions and contract clauses         551
653             Forms.......................................         563

[[Page 493]]



                          SUBCHAPTER A--GENERAL





PART 601--DEPARTMENT OF STATE ACQUISITION REGULATIONS SYSTEM--Table of Contents




Sec.
601.000  Scope of part.

               Subpart 601.1--Purpose, Authority, Issuance

601.101  Purpose.
601.105  OMB approval under the Paperwork Reduction Act.

                      Subpart 601.2--Administration

601.201  Maintenance of the FAR.
601.201-1  The two councils.

              Subpart 601.3--Agency Acquisition Regulations

601.301  Policy.
601.302  Limitations.
601.303  Publication and codification.

                 Subpart 601.4--Deviations from the FAR

601.403  Individual deviations.
601.404  Class deviations.
601.405  Deviations pertaining to treaties and executive agreements.
601.470  Deviations from the DOSAR.
601.471  Procedures.

             Subpart 601.5--Agency and Public Participation

601.570  Rulemaking.

      Subpart 601.6--Career Management, Contracting Authority, and 
                            Responsibilities

601.601  General.
601.602  Contracting officers.
601.602-1  Authority.
601.602-3  Ratification of unauthorized commitments.
601.602-3-70  Procedures.
601.603  Selection, appointment, and termination of appointment.
601.603-3  Appointment.
601.603-70  Delegations of authority.
601.670  Procurement Career Management Program.

    Authority:  40 U.S.C. 486(c); 22 U.S.C. 2658.

    Source:  53 FR 26159, July 11, 1988, unless otherwise noted.



601.000  Scope of part.

    This part describes the Department of State Acquisition Regulation 
(DOSAR) in terms of establishment, relationship to the Federal 
Acquisition Regulation (FAR), arrangement, applicability, and deviation 
procedures.
[53 FR 26159, July 11, 1988, as amended at 59 FR 66750, Dec. 28, 1994]



               Subpart 601.1--Purpose, Authority, Issuance



601.101  Purpose.

    The DOSAR is issued to provide Department guidance in accordance 
with the policy cited in FAR 1.301(a)(2). The portions of this 
regulation that affects the relationship between a Department of State 
organization and a contractor or potential contractor are published in 
this chapter 6 of title 48 of the Code of Federal Regulations, in 
accordance with FAR 1.301(b).
[59 FR 66750, Dec. 28, 1994]



601.105  OMB approval under the Paperwork Reduction Act.

    The Paperwork Reduction Act of 1980 (44 U.S.C. 3501-3520) requires 
that Federal agencies obtain approval from the Office of Management and 
Budget (OMB) before collecting information from ten (10) or more members 
of the public. The information and recordkeeping requirements contained 
in this regulation have been approved by OMB under OMB Control Number 
1405-0050.
[59 FR 66750, Dec. 28, 1994]



                      Subpart 601.2--Administration



601.201  Maintenance of the FAR.



601.201-1  The two councils.

    The Office of the Procurement Executive (A/OPE) represents the 
Department of State (DOS) on the Civilian Agency Acquisition Council. 
The Procurement Executive shall appoint a representative for this 
purpose. A/OPE is responsible for coordinating with all interested DOS 
elements proposed FAR

[[Page 494]]

revisions and for advocating FAR revisions sought by the Department.
[53 FR 26159, July 11, 1988, as amended at 59 FR 66750, Dec. 28, 1994]



              Subpart 601.3--Agency Acquisition Regulations



601.301  Policy.

    (a)(1) The Assistant Secretary of State for Administration is the 
agency head for the purposes of FAR 1.301 (see Delegation of Authority 
No. 120 (34 FR 18095, October 30, 1969), as amended by Delegation of 
Authority No. 120-4 (59 FR 38022, July 26, 1994)). Under Delegation of 
Authority No. 120-5 (59 FR 62771, December 6, 1994), the Assistant 
Secretary of State for Administration redelegated to the Procurement 
Executive the authority to prescribe, promulgate, and amend DOS 
acquisition policies, rules, and regulations.
    (2) The Department's procurement directives system consists of the 
following components:
    (i) The DOSAR;
    (ii) Procurement Policy Directives (PPDs), which provide basic 
policy or procedural guidance and direction. PPDs are issued on an 
interim basis, and are subsequently incorporated into the next revision 
of the DOSAR; and
    (iii) Procurement Information Bulletins, which provide general 
information on topics of interest to contracting personnel.
    (b) The Department of State Acquisition Regulation (DOSAR) is 
prescribed under the authority of 22 U.S.C. 2658 and 40 U.S.C. 486(c).
    (c) The DOSAR implements and supplements the FAR.
[59 FR 66751, Dec. 28, 1994]



601.302  Limitations.

    (a) The FAR and the DOSAR apply to all DOS acquisitions of personal 
property and services, including construction and leases of real and 
personal property, both within and outside the United States, unless 
expressly excluded by this subpart, or exempt from the Federal Property 
and Administrative Services Act of 1949, as amended (40 U.S.C. 474(7)), 
or undertaken pursuant to section 208 of the State Department Basic 
Authorities Act of 1956, as amended (22 U.S.C. 4308), or the Foreign 
Service Buildings Act of 1926, as amended (22 U.S.C. 292 et seq.).
    (b) At posts where Joint Administrative Offices have been formed, 
the FAR and the DOSAR apply to all Agency for International Development 
(AID) administrative and technical support acquisitions, except in those 
areas which have been exempted by the cognizant administrative office.
[53 FR 26159, July 11, 1988, as amended at 59 FR 66751, Dec. 28, 1994]



601.303  Publication and codification.

    (a) The DOSAR is issued as Chapter 6 of Title 48, Code of Federal 
Regulations. The DOSAR is established as Chapter 6 of the Federal 
Acquisition Regulations System. The DOSAR is divided into the same 
parts, subparts, sections, subsections, and paragraphs as is the FAR. 
However, when the FAR coverage is adequate by itself there will be no 
corresponding DOSAR coverage. Where the DOSAR implements a specific 
part, subpart, section, or subsection of the FAR, the DOSAR coverage is 
numbered and titled to correspond to the appropriate FAR number and 
title, except that the DOSAR number will include a 6 or 60 such that 
there will always be three numbers to the left of the decimal. For 
example, the DOSAR implementation of FAR 14.1 is shown as 614.1 and the 
DOSAR implementation of FAR 1.301 is shown as 601.301. Materials that 
supplement the FAR are assigned the numbers 70 and up. For example, 
DOSAR requires additional definitions than those used in FAR; this 
supplementary material is provided in 602.101-70.
    (b) The DOSAR and its revisions are published in the Federal 
Register and in the Code of Federal Regulations, both of which may be 
purchased from the Superintendent of Documents, Government Printing 
Office, Washington, DC 20402.
    (c) The DOSAR shall be referenced in the same manner as described at 
FAR 1.104-2(c).
[53 FR 26159, July 11, 1988, as amended at 59 FR 66751, Dec. 28, 1994]

[[Page 495]]



                 Subpart 601.4--Deviations from the FAR



601.403  Individual deviations.

    The Procurement Executive is the agency head's designee for the 
purposes of FAR 1.403.
[53 FR 26159, July 11, 1988, as amended at 59 FR 66751, Dec. 28, 1994]



601.404  Class deviations.

    The Procurement Executive is the agency head's designee for the 
purposes of FAR 1.404(a).
[53 FR 26159, July 11, 1988, as amended at 59 FR 66751, Dec. 28, 1994]



601.405  Deviations pertaining to treaties and executive agreements.

    The Procurement Executive shall determine whether a deviation 
pertaining to treaties and executive agreements is authorized under FAR 
1.405 or that a request for deviation is required under FAR 1.405(e).
[53 FR 26159, July 11, 1988, as amended at 59 FR 66751, Dec. 28, 1994]



601.470  Deviations from the DOSAR

    The authority to approve any deviations from the DOSAR is reserved 
to the Procurement Executive.
[53 FR 26159, July 11, 1988, as amended at 59 FR 66751, Dec. 28, 1994]



601.471  Procedures.

    (a) The head of the contracting activity shall submit to the 
Procurement Executive a written request for each deviation from the FAR 
or the DOSAR, whether for individual cases, classes of cases, or 
deviations pertaining to treaties and executive agreements. Each request 
for a deviation shall state--
    (1) The nature of the deviation requested, including whether it is 
an individual or class deviation;
    (2) The FAR or DOSAR regulation from which the deviation is 
requested;
    (3) The circumstances under which the deviation would be used;
    (4) The effect intended by the deviation; and
    (5) The expiration date recommended for the deviation.
    (b) The head of the contracting activity shall also submit all 
pertinent documentation supporting the request.
    (c) The contracting officer shall include in the contract file a 
copy of each authorized deviation that pertains to the acquisition.
[53 FR 26159, July 11, 1988, as amended at 59 FR 66751, Dec. 28, 1994]



             Subpart 601.5--Agency and Public Participation



601.570  Rulemaking.

    (a) The DOSAR is promulgated and may be revised, as necessary, in 
accordance with FAR part 1.
    (b) The Procurement Executive shall issue all DOS acquisition 
regulations.
[59 FR 66751, Dec. 28, 1994]



      Subpart 601.6--Career Management, Contracting Authority, and 
                            Responsibilities



601.601  General.

    The Procurement Executive is the agency head for the purposes of FAR 
1.601.



601.602  Contracting officers.



601.602-1  Authority.

    (a) DOS contracts are awarded pursuant to the foreign affairs 
management responsibilities conferred on the Secretary of State (22 
U.S.C. 2656), and the various laws, regulations, and Executive Orders 
relating thereto.
    (b) Except as otherwise provided by law, DOS regulations, and this 
DOSAR, the Procurement Executive has the authority to execute, award, 
and administer contracts, purchase orders, other contractual 
arrangements, and other agreements, including FAR-covered interagency 
acquisition agreements, for the expenditure of funds involved in the 
acquisition of real and personal property, services, and for the sale of 
personal property. The Procurement Executive may further delegate this 
authority to those DOS employees appointed or designated to the 
contracting activities enumerated in 601.603-70.
    (c) The contracting officer shall not award, modify, or terminate a 
contract

[[Page 496]]

unless all reviews, clearances, and approvals prescribed in the FAR or 
the DOSAR have been obtained, and all applicable requirements of law, 
the FAR, the DOSAR, and other regulations have been met.
[53 FR 26159, July 11, 1988, as amended at 55 FR 5774, Feb. 16, 1990; 59 
FR 66751, Dec. 28, 1994]



601.602-3  Ratification of unauthorized commitments.

    (b) Policy. (1) The Government generally is not bound by 
unauthorized commitments. Unauthorized commitments violate the Federal 
Property and Administrative Services Act, other Federal laws, the FAR, 
the DOSAR, and proper acquisition practice. Therefore, such unauthorized 
commitments are serious violations that usually necessitate disciplinary 
action agaisnt the transgressor, e.g., withdrawal of a contracting 
officer's warrant or a Contracting Officer's Representative delegation 
or collection action.
    (2) The head of the contracting activity is delegated the authority 
to serve as the ratifying official for unauthorized contractual 
commitments not exceeding $1,000. The head of the contracting activity 
may refer such actions to the Procurement Executive for ratification if 
he/she so chooses. All unauthorized commitments in excess of $1,000 
shall be ratified by the Procurement Executive.
    (3) Unauthorized contractual commitments that would involve claims 
subject to resolution under the Contracts Dispute Act of 1978 shall be 
processed in accordance with FAR Subpart 33.2 and Subpart 633.2.
    (c) Limitations. The contracting officer is not required to obtain 
concurrence of legal counsel when recommending payment of an 
unauthorized commitment. However, the contracting officer is encouraged 
to obtain legal concurrence if there is a question of proprietary or a 
legal issue.
[53 FR 26159, July 11, 1988, as amended at 59 FR 66751, Dec. 28, 1994]



601.602-3-70  Procedures.

    (a)(1) The person who made the unauthorized commitment shall submit 
all records and documents concerning the unauthorized commitment to the 
contracting officer assigned the ratification action. That person shall 
provide a complete written, signed statement of the facts, including why 
normal acquisition procedures were not followed, why and how the vendor 
was selected, a list of other sources considered, a description of work 
or products, a statement regarding the status of performance, an 
estimated or agreed price, certified funding citations, and a statement 
as to why he/she should not be personally liable for the cost, e.g., a 
public purpose was served and no personal benefit was received.
    (2) When the person who made the unauthorized commitment is no 
longer available to attest to the circumstances of the unauthorized 
commitment, an officer from the responsible office shall accomplish the 
requirements of this paragraph; the statement shall identify the 
individual responsible for the unauthorized commitment.
    (3) In addition, a cognizant management official from the office 
which employed the individual who made the unauthorized commitment at 
the time the unauthorized commitment was made shall provide a statement 
detailing actions that he/she will take to ensure that such commitments 
will not occur again under the same or similar circumstances.
    (b) The contracting officer assigned the ratification action shall 
prepare and execute a recommendation to the ratifying official. The 
contracting officer shall either recommend that the ratifying official 
approve and ratify the unauthorized commitment; or, disapprove the 
ratification of the unauthorized commitment.
    (1) The recommendation shall include the facts and circumstances of 
the unauthorized commitment; the information prescribed in FAR 1.602-
3(c)(1) and (c)(3) through (c)(6); and a recommendation to the ratifying 
official as to whether the unauthorized commitment should be ratified.
    (2) Following the signature of the contracting officer, the 
recommendation shall include a statement that the ratifying official 
could have granted authority to enter into a contractual commitment at 
the time it was made and still has the authority to do so;

[[Page 497]]

that the ratifying official hereby ratifies (or disapproves) the 
unauthorized commitment in the amount specified; and a date and 
signature block for the ratifying official.
    (c) The information required in paragraph (b)(1) of this section 
shall be supported by factual findings included or referenced in the 
recommendation.
    (d) The contracting officer shall submit the complete file to the 
ratifying official. For actions exceeding $1,000, the file shall be 
submitted through the head of the contracting activity to the 
Procurement Executive.
    (e) Upon receipt and review of the complete file, if the ratifying 
official ratifies the unauthorized commitment, the file shall be 
returned, through the head of the contracting activity if the action 
exceeds $1,000, to the contracting officer for issuance of the 
appropriate contractual document(s). If the request for ratification is 
not justified, the ratifying official shall return the request to the 
head of the contracting activity (if over $1,000) or to the contracting 
officer if under $1,000) with a written explanation for the decision and 
a recommendation for disposition of the action.
    (f)(1) When a ratification is approved, the ratifying official shall 
prepare a letter to the contractor involved in the ratification. The 
letter shall state the reason(s) why the ratification was approved and 
provide cautionary language to the contractor regarding future instances 
of ratification actions.
    (2) When a ratification is not approved, the head of the contracting 
activity shall prepare a letter to the contractor advising that the 
ratification was not approved. The letter shall cite the reasons for the 
disapproval.
[59 FR 66751, Dec. 28, 1994]



601.603  Selection, appointment, and termination of appointment.



601.603-3  Appointment.

    (a) There is no contracting officer authority conferred upon any DOS 
employee by virtue of position. The Procurement Executive appoints all 
DOS contracting officers, in conformance with FAR 1.603-3. The 
contracting officer shall retain the original copy of the Standard Form 
1402, Certificate of Appointment, signed by the Procurement Executive. 
Only qualified employees shall be appointed as contracting officers. A/
OPE is responsible for providing guidance and oversight in managing such 
appointments.
    (b) Contracting officers shall be appointed in accordance with the 
Procurement Career Management Guidebook, available from A/OPE.
    (c) Non-Federal employees. Only United States Government direct-hire 
employees who are U.S. citizens shall be appointed as contracting 
officers. Personal services contractors, Foreign Service Nationals, and 
Third Country Nationals are not eligible for appointment as DOS 
contracting officers.
[59 FR 66752, Dec. 28, 1994]



601.603-70  Delegations of authority.

    (a) Delegations. As stated in 601.603-3(a), there is no contracting 
officer authority conferred by virtue of position. Pursuant to 601.602-
1(b), the Procurement Executive has designated the following as 
contracting activities as defined in FAR 2.101. These authorities are 
not redelegable. In addition, specific individuals are designated as 
heads of contracting activities (HCAs) (see FAR 2.101):
    (1) Overseas posts. Each overseas post shall be regarded as a 
contracting activity to enter into and administer contracts for the 
expenditure of funds involved in the acquisition of supplies, equipment, 
publications, and services; to sell personal property; and to lease real 
property. The Principal Officer, the Administrative Officer, or the 
Supervisory General Services Officer are designated as HCAs; provided, 
that he/she has a contracting officer's warrant issued by the 
Procurement Executive. The Procurement Executive (or authorized A/OPE 
staff) may delegate to a contracting officer, on a case-by-case basis, 
the authority to award a contract or modification which exceeds the 
contracting officer's warrant level.
    (i) No authority is delegated to enter into cost-reimbursement, 
fixed-price incentive, or fixed-price redeterminable contracts.
    (ii) When expressly authorized by a U.S. Government agency which 
does not have a contracting officer at the post, the officers named in 
paragraph

[[Page 498]]

(a)(1) introductory text of this section may enter into contracts for 
that agency. Use of this authority is subject to the statutory authority 
of that agency and any special contract terms or other requirements 
necessary for compliance with any conditions or limitations applicable 
to the funds of that agency. The agency's authorization shall cite the 
statute(s) and state any special contract terms or other requirements 
with which the acquisition so authorized must comply. In view of the 
contracting officer's responsibility for the legal, technical, and 
administrative sufficiency of contracts, questions regarding the 
propriety of contracting actions that the post is required to take 
pursuant to this authority may be referred to the Department for 
resolution with the headquarters of the agency concerned.
    (2) Office of Foreign Buildings. The authority to enter into and 
administer contracts pursuant to the Foreign Service Buildings Act of 
1926, as amended (22 U.S.C. 292 et seq.), is delegated to the Deputy 
Assistant Secretary of State for Foreign Buildings and to the Director 
for Acquisitions as the HCA.
    (3) Office of Acquisition. The authority to enter into and 
administer contracts for the expenditure of funds involved in the 
acquisition of supplies and nonpersonal services is delegated to the 
Director and Deputy Director as the HCA.
    (4) Foreign Service Institute. The authority to enter into and 
administer contracts pursuant to Chapter 7, Title I, of the Foreign 
Service Act of 1980, as amended (22 U.S.C. 4021 et seq.), is delegated 
to the Director of the Foreign Service Institute, the Executive 
Director, the Deputy Executive Director, and the Supervisory Contracting 
Officer as the HCA.
    (5) Office of Foreign Missions. The authority to enter into and 
administer contracts pursuant to Title II of the State Department Basic 
Authorities Act of 1956, as amended (22 U.S.C. 4301 et seq.), is 
delegated to the Director, Office of Foreign Missions, and the 
Administrative Officer as the HCA.
    (6) U.S. Mission to the United Nations. The authority to enter into 
and administer contracts pursuant to the United Nations Participation 
Act of 1945, as amended (22 U.S.C. 287), is delegated to the Counselor 
for Administration as the HCA.
    (7) Moscow Embassy Building Control Office. The authority to enter 
into and administer contracts for the planning, design, and construction 
of the embassy office building in Moscow is delegated to the Director, 
Moscow Embassy Building Control Office as the HCA.
    (8) Diplomatic Telecommunication Service--Program Office. The 
authority to enter into and administer contracts for the leasing or 
purchase of telecommunications services, circuits, subsystems, and 
associated professional services is delegated to the Chief, Acquisition 
Branch as the HCA.
    (9) Regional Procurement Support Offices. (i) The authority to enter 
into and administer contracts for the expenditure of funds involved in 
the acquisition of supplies, equipment, publications, services, execute 
leases for real property, and to sell personal property on behalf of 
overseas posts is delegated to each Director, Regional Procurement 
Support Office (RPSO) as the HCA at the following locations:
    (A) RPSO Bonn in conjunction with Embassy Bonn;
    (B) RPSO Tokyo in conjunction with Embassy Tokyo;
    (C) RPSO Singapore in conjunction with Embassy Singapore; and,
    (D) RPSO Miami in conjunction with the Miami Regional Center.
    (ii) The RPSOs are under the purview and guidance of A/OPE.
    (b) Other delegations. Several DOS offices have been delegated 
limited procurement authority, although they have not been designated as 
HCAs. Matters requiring HCA resolution are referred to the Office of 
Acquisition. These delegations are provided only to warranted 
contracting officers in the respective offices. They are as follows:
    (1) Office of Language Services. The authority to enter into and 
administer simplified acquisition transactions under FAR Part 13 and 
orders against schedule contracts for interpreting, translating, 
conference reporting, and related language support and escort services.

[[Page 499]]

    (2) Office of Overseas Schools. The authority to enter into and 
administer simplified acquisition transactions under FAR Part 13 and 
orders against schedule contracts pursuant to section 29 of the State 
Department Basic Authorities Act of 1956, as amended.
    (3) Library. The authority to enter into and administer simplified 
acquisition transactions under FAR Part 13 and orders against schedule 
contracts pursuant to the provisions of the Public Printing and 
Documents Act of 1968, as amended, and for the acquisition of 
newspapers, books, maps, and periodicals.
    (4) Office of International Conferences. The authority to enter into 
and administer simplified acquisition transactions under FAR Part 13 and 
orders against schedule contracts pursuant to section 5, Title I, of the 
Department of State Basic Authorities Act of 1956, as amended.
    (5) Bureau of Population, Refugees, and Migration. The authority to 
enter into and administer simplified acquisition transactions under FAR 
Part 13 and orders against schedule contracts pursuant to the Migration 
and Refugee Assistance Act of 1962, as amended, and Executive Order 
11077, dated January 22, 1963.
    (6) Bureau of International Narcotics and Law Enforcement Affairs. 
The authority to enter into and administer simplified acquisition 
transactions under FAR Part 13, orders against schedule contracts and 
personal services contracts pursuant to the Foreign Assistance Act of 
1961, as amended; and, 48 CFR Chapter 7, Agency for International 
Development Acquisition Regulation, including any amendments thereto.
[59 FR 66752, Dec. 28, 1994, as amended at 60 FR 39662, Aug. 3, 1995]



601.670  Procurement Career Management Program.

    (a) Policy. The Department's Procurement Career Management Program 
is designed to improve the quality of contracting in the Department 
through the development and maintenance of professional contracting 
skills in accordance with the Federal Acquisition Institute's Contract 
Specialist Workbook and related guidance.
    (b) Procedures. Details of the Department's Procurement Career 
Management Program are described in the Department of State Procurement 
Career Management Guidebook. A/OPE shall provide guidance and oversight.
[59 FR 66753, Dec. 28, 1994]



PART 602--DEFINITIONS OF WORDS AND TERMS--Table of Contents




                       Subpart 602.1--Definitions

Sec.
602.101  Definitions.
602.101-70  DOSAR definitions.

    Authority:  40 U.S.C. 486(c); 22 U.S.C. 2658.

    Source:  53 FR 26162, July 11, 1988, unless otherwise noted.



                       Subpart 602.1--Definitions



602.101  Definitions.



602.101-70  DOSAR definitions.

    For the purposes of the DOSAR, unless otherwise indicated, the 
following terms have the meanings set forth in this subpart.
    Consolidated Receiving Point or CRP; means the contractor under 
contract to a Despatch Agency to receive and prepare items for shipment 
to a post. The CRP receives, records, consolidates, and packs items for 
shipment overseas under the direction of the Despatch Agency.
    Department or DOS means the Department of State, including all of 
its activities wherever located.
    Despatch Agency means the office responsible for the transportation 
of goods between the U.S. and posts within its specific geographic area 
as assigned by the Transportation Division, Office of Supply and 
Transportation. There are four Despatch Agencies, one each in New York 
City; Baltimore, Maryland; Miami, Florida; and, Seattle, Washington.
    Government means the Government of the United States of America 
unless specifically stated otherwise.
    Local procurement means acquisition by a post in the country in 
which the post is located.
    Overseas post means a ``post'' located outside the United States of 
America.

[[Page 500]]

    Post means a diplomatic or consular mission of the United States of 
America, administered or managed by the DOS.
[53 FR 26163, July 11, 1988, as amended at 59 FR 66753, Dec. 28, 1994; 
60 FR 39662, Aug. 3, 1995]



PART 603--IMPROPER BUSINESS PRACTICES AND PERSONAL CONFLICTS OF INTEREST--Table of Contents




                        Subpart 603.1--Safeguards

Sec.
603.104  Procurement integrity.
603.104-5  Disclosure, protection, and marking of proprietary and source 
          selection information.
603.104-9  -70  Certification requirements.
603.104-11  Processing violations or possible violations.

      Subpart 603.2--Contractor Gratuities to Government Personnel

603.203  Reporting suspected violations of the Gratuities clause.
603.204  Treatment of violations.

        Subpart 603.3--Reports of Suspected Antitrust Violations

603.303  Reporting suspected antitrust violations.

                     Subpart 603.4--Contingent Fees

603.408  Evaluation of the SF 119.
603.408-1  Responsibilities.

  Subpart 603.6--Contracts with Government Employees or Organizations 
                       Owned or Controlled by Them

603.601  Policy.
603.602  Exceptions.
603.670  Solicitation provision and contract clause.

             Subpart 603.7--Voiding and Rescinding Contracts

603.704  Policy.
603.705  Procedures.

    Authority:  40 U.S.C. 486(c); 22 U.S.C. 2658.

    Source:  53 FR 26163, July 11, 1988, unless otherwise noted.



                        Subpart 603.1--Safeguards

    Source:  59 FR 66753, Dec. 28, 1994, unless otherwise noted.



603.104  Procurement integrity.



603.104-5  Disclosure, protection, and marking of proprietary and source selection information.

    (d)(1) The head of the contracting activity is the agency head's 
designee for the purposes of FAR 3.104-5(d)(1).
    (2) The following classes of persons may be authorized access to 
proprietary or source selection information by the contracting officer 
or head of the contracting activity when such access is necessary to the 
conduct of a procurement:
    (i) Clerical personnel directly involved in the procurement;
    (ii) Supervisors in the contracting officer's chain of command;
    (iii) Contracting personnel involved in reviewing or approving the 
solicitation, contract, or contract modification; and
    (iv) Personnel in the following offices: Office of Small and 
Disadvantaged Business Utilization (A/SDBU), Office of the Legal Adviser 
(L/BA), Office of Legislative Affairs, Office of the Inspector General, 
the Small Business Administration, and the Office of Federal Contract 
Compliance Programs (Department of Labor).



603.104-9-70  Certification requirements.

    (b) Competing contractors are required to complete the ``Certificate 
of Procurement Integrity'' and submit it with their bids under IFBs. For 
RFPs, the apparent successful offeror only need submit the 
certification. For RFPs, the contracting officer shall contact the 
apparent successful offeror before award and request that the 
certificate be submitted within five (5) working days if the certificate 
was not submitted with the initial proposal. A bid submitted under an 
IFB that lacks a signed certificate is nonresponsive, and an apparent 
successful offeror under an RFP who does not submit the required 
certificate is ineligible for award.



603.104-11  Processing violations or possible violations.

    (a) The contract specialist shall report any violation or possible 
violation

[[Page 501]]

of the procurement integrity requirements immediately to the contracting 
officer and the Office of the Inspector General. The contracting officer 
shall follow the procedures in FAR 3.104-11 regarding such violations.



      Subpart 603.2--Contractor Gratuities to Government Personnel



603.203  Reporting suspected violations of the Gratuities clause.

    DOS personnel shall report immediately and in writing any apparent 
or suspected violation of the clause at FAR 52.203-3, Gratuities, in 
connection with any DOS operation. The report shall be made to the 
contracting officer and the Assistant Inspector General for 
Investigations. The report shall identify the individuals involved, 
outline the events, acts, or conditions which indicate the apparent 
violation occurred, and include all pertinent documents. The Assistant 
Inspector General for Investigations shall review the report for 
completeness and accuracy and shall make a preliminary decision whether 
to proceed with a full investigation. The Assistant Inspector General 
for Investigations shall provide the written decision to the individual 
who made the report and the contracting officer. If the decision is to 
proceed with an investigation, copies of the decision shall also be 
provided to the head of the contracting activity, the Procurement 
Executive, and the Office of the Legal Adviser.
[53 FR 26163, July 11, 1988, as amended at 59 FR 66754, Dec. 28, 1994]



603.204  Treatment of violations.

    (a) The Procurement Executive is the agency head's designee for the 
purposes of FAR 3.204.
    (b) Procedures. Upon a decision to proceed with an investigation of 
an alleged violation of the Gratuities clause, the Assistant Inspector 
General for Investigations shall provide to the contractor a written 
notice by certified mail, return receipt requested. The notice shall 
present the findings of the decision and shall establish a schedule, 
including location, for an investigative hearing for the purposes 
prescribed in FAR 3.204(b). As determined necessary by the Assistant 
Inspector General for Investigations, follow-up hearings may be 
scheduled. Upon completion of the investigation, the Assistant Inspector 
General for Investigations shall provide to the Procurement Executive a 
report and recommendation, together with all pertinent documentation.
    (c) In addition to the requirements of FAR 3.204(c), when the 
Procurement Executive determines that a violation has occurred, the 
Procurement Executive shall so notify the Assistant Inspector General 
for Investigations. The Assistant Inspector General for Investigations 
shall then notify the individual who made the report, the Office of the 
Legal Adviser, and, if appropriate, the Department of Justice.



        Subpart 603.3--Reports of Suspected Antitrust Violations



603.303  Reporting suspected antitrust violations.

    (a) DOS employees are obligated to report immediately and in writing 
any apparent or suspected antitrust violation, as described in FAR 
3.303.
    (b) The report shall outline the events, acts, or conditions which 
indicate the apparent violation and shall include all pertinent 
documents.
    (c) The report shall be made to or by the contracting officer, who 
shall review it for completeness and accuracy and forward it through the 
head of the contracting activity, to the Office of the Legal Adviser, 
with a copy to the Procurement Executive. The Office of the Legal 
Adviser shall provide to the U.S. Attorney General a report on each 
suspected violation, with singles copies to the head of the contracting 
activity and the Procurement Executive.
[53 FR 26163, July 11, 1988, as amended at 59 FR 66754, Dec. 28, 1994]



                     Subpart 603.4--Contingent Fees



603.408  Evaluation of the SF 119.



603.408-1  Responsibilities.

    In carrying out responsibilities prescribed in FAR 3.408-1, the 
contracting

[[Page 502]]

officer shall obtain advice from the Office of the Legal Adviser as to 
the legality and general propriety of the relationship disclosed 
thereon. Also, the contracting officer may request the Office of the 
Inspector General to develop further information if the facts available 
are deemed insufficient for a proper decision. After reviewing and 
evaluating all the information obtained, the contracting officer shall 
render a written decision that shall be included in the contract file, 
and shall provide a copy of the decision to the Procurement Executive.



  Subpart 603.6--Contracts with Government Employees or Organizations 
                       Owned or Controlled by Them



603.601  Policy.

    (a) It is Department policy not to award contracts to Federal 
employees, or businesses substantially owned or controlled by Federal 
employees.
[59 FR 66754, Dec. 28, 1994]



603.602  Exceptions.

    The Procurement Executive is the agency head's designee for the 
purposes of FAR 3.602.



603.670  Solicitation provision and contract clause.

    The contracting officer shall insert the clause at 652.203-70, 
Prohibition Against the Use of Federal Employees, in all solicitations 
and contracts, and the provision at 652.203-71, Certification Regarding 
Federal Employment, in all solicitations.
[59 FR 66754, Dec. 28, 1994]



             Subpart 603.7--Voiding and Rescinding Contracts



603.704  Policy.

    The Procurement Executive is the agency head's designee for the 
purposes of FAR 3.704.
[59 FR 66754, Dec. 28, 1994]



603.705  Procedures.

    The Procurement Executive is the agency head's designee for the 
purposes of FAR 3.705.
[59 FR 66754, Dec. 28, 1994]



PART 604--ADMINISTRATIVE MATTERS--Table of Contents




                  Subpart 604.2--Contract Distribution

Sec.
604.202  Agency distribution requirements.

   Subpart 604.4--Safeguarding Classified Information Within Industry

604.404  Contract clause.
604.404-70  DOSAR contract clauses.

                     Subpart 604.70--Contract Review

604.7001  Policy.
604.7002  Procedures.

    Authority:  40 U.S.C. 486(c); 22 U.S.C. 2658.

    Source:  53 FR 26163, July 11, 1988, unless otherwise noted.



                  Subpart 604.2--Contract Distribution



604.202  Agency distribution requirements.

    As necessary, the contracting officer shall distribute reproduced 
copies of the signed contract or modification to those officers/offices 
involved in contract administrative support functions, e.g., the 
Contracting Officer's Representative; the requirements office; the 
Despatch Agent or other receiving activity, particularly if it is the 
initial point of contact for receipt of goods or services; and each post 
or office where the contract will be performed. Where required by the 
laws of a foreign country, the original copy of the contract or 
modification shall be retained at the overseas post. Copies of contracts 
and modifications awarded as small business or 8(a) set-asides shall be 
sent to A/SDBU.
[53 FR 26163, July 11, 1988, as amended at 59 FR 66754, Dec. 28, 1994]

[[Page 503]]



   Subpart 604.4--Safeguarding Classified Information Within Industry



604.404  Contract clause.



604.404-70  DOSAR contract clauses.

    (a) The contracting officer shall insert the clause at 652.204-70, 
Security Requirements, in solicitations and contracts performed outside 
the United States to the extent the contract involves access to 
classified information (``Confidential,'' ``Secret,'' or ``Top Secret'') 
or access to administratively controlled information (``Limited Official 
Use''). Contractors or contract employees that are not U.S. citizens 
shall not have access to classified or administratively controlled 
information.
    (b) The contracting officer shall insert the clause at 652.204-71, 
Security Requirements--Personnel, in solicitations and contracts 
performed outside the United States.



                     Subpart 604.70--Contract Review



604.7001  Policy.

    The contracting officer shall review each proposed contractual 
document and its supporting file for completeness and accuracy. Each 
contract file shall contain all pertinent information applicable to the 
proposed action. Each contract file should be in sufficient detail to 
permit reconstruction of all significant events by any subsequent 
reviewer without referral to the individual responsible for the 
contractual action.
[53 FR 26163, July 11, 1988; 53 FR 36461, Sept. 20, 1988]



604.7002  Procedures.

    (a) Prior to issuance of a solicitation or a solicitation amendment 
which constitutes a substantive change, award of a contract, or 
execution of a contract modification, any of which is estimated to 
exceed the thresholds indicated below, the contracting officer shall 
forward the proposed contractual action to A/OPE for review. For 
contract modifications, the contracting officer shall submit such 
actions in accordance with 643.102-70(b). Modifications exercising 
contract options, where the options were part of the original 
solicitation/contract which was reviewed and approved by A/OPE, are 
exempt from this review requirement:
    (1) For domestic contracting activities, all actions over 
$5,000,000. There is no review threshold when the contracting activity's 
quality assurance plan has been approved by A/OPE;
    (2) For overseas posts with contracting officers who have been 
issued standard name warrants, all actions over $250,000, with the 
exception of those actions for local guard services, which require 
review at $100,000 and above; and
    (3) For overseas posts with contracting officers who have been 
issued provisional name warrants, all actions over $100,000.
    (4) When calculating the threshold for application of paragraphs 
(a)(1) through (3) of this section, include the value of the base year 
plus all option years.
    (b) A/OPE shall document the scope and extent of the review and 
shall submit written recommendations to the contracting officer on each 
proposed contract action reviewed. In the event the contracting officer 
and the reviewer cannot reach agreement on the recommendation(s), the 
contracting officer shall prepare an appeal file to be transmitted to 
the Procurement Executive. The appeal shall be approved by an individual 
one management level above the contracting officer prior to its 
transmission to the Procurement Executive. A resolution shall be worked 
out between the contracting activity and the Procurement Executive. For 
purposes of this section, the officer who may transmit the appeal file 
to the Procurement Executive shall not be the same individual who will 
sign the contractual document. For overseas posts, where the contracting 
officer is the head of the contracting activity, the approval authority 
shall be the Principal Officer.
    (c) For postaward reviews, A/OPE shall document the scope and extent 
of the review and shall submit the results of its findings to the 
contracting officer for appropriate action.

[[Page 504]]

    (d) The Procurement Executive may delegate or waive the review 
requirements. In such instances, the Procurement Executive shall provide 
to each head of the contracting activity, as appropriate, a written 
delegation or waiver of these requirements.
[53 FR 26163, July 11, 1988, as amended at 59 FR 66754, Dec. 28, 1994]

[[Page 505]]



           SUBCHAPTER B--COMPETITION AND ACQUISITION PLANNING





PART 605--PUBLICIZING CONTRACT ACTIONS--Table of Contents




          Subpart 605.2--Synopsis of Proposed Contract Actions

Sec.
605.202  Exceptions.
605.202-70  Foreign acquisitions.
605.207  Preparation and transmittal of synopses.
605.207-70  Acquisitions available from only one responsible source.

               Subpart 605.3--Synopses of Contract Awards

605.303  Announcement of contract awards.

                  Subpart 605.4--Release of Information

605.403  Requests from members of Congress.
605.404  Release of long-range acquisition estimates.
605.404-1  Release procedures.

                   Subpart 605.5--Paid Advertisements

605.502  Authority.

    Authority:  40 U.S.C. 486(c); 22 U.S.C. 2658.

    Source:  53 FR 26164, July 11, 1988, unless otherwise noted.



          Subpart 605.2--Synopsis of Proposed Contract Actions



605.202  Exceptions.



605.202-70  Foreign acquisitions.

    (a) Policy. In accordance with a Determination and Findings issued 
by the Assistant Secretary of State for Administration, the requirement 
for advance CBD notices for the Department's foreign acquisitions 
awarded by overseas contracting activities is waived. CBD notices may be 
published for any acquisition where the contracting officer decides that 
publication would be in the Department's best interests. This waiver 
shall remain in effect until June 15, 1998.
    (b) Procedures. Contracting officers at overseas contracting 
activities are not required to prepare an individual determination and 
findings to document their decision to waive the CBD notice 
requirements.
    (c) Competition requirements. Nothing in this section waives the 
requirement to obtain competition as required by FAR part 6 and DOSAR 
(48 CFR) part 606. Competition, including the use of written 
solicitation, shall be obtained in all cases to the extent feasible. If 
there are known U.S. firms or firms with U.S. affiliations in local 
residence capable of supplying the required supplies or services, the 
contracting activity shall ensure that those firms are included in the 
source list for the acquisition.
    (d) Policy exclusion. CBD waiver authority does not apply to local 
guard service contracts that exceed $250,000. Local guard service 
contracts that exceed $250,000 shall be synopsized in the CBD. Option 
year prices shall be included when computing the applicability of this 
threshold.
[60 FR 39662, Aug. 3, 1995]



605.207  Preparation and transmittal of synopses.

    (a)(1) Contracting officers at overseas posts shall submit synopses 
of proposed contract actions to A/OPE for electronic transmittal to the 
CBD.
[59 FR 66755, Dec. 28, 1994]



605.207-70  Acquisitions available from only one responsible source.

    In addition to the information required at FAR 5.207, each synopsis 
of a proposed acquisition from only one responsible source shall include 
descriptions of the specific qualifications or capabilities required to 
perform the work and the information a potential source must submit.



               Subpart 605.3--Synopses of Contract Awards



605.303  Announcement of contract awards.

    (a) Contracting officers shall make information available on awards 
over $10 million to the Office of Legislative

[[Page 506]]

Affairs in sufficient time for an announcement by 5:00 p.m. Washington, 
DC time on the day of the award. This requirement applies only to awards 
made by domestic contracting activities where performance will take 
place within the United States or its possessions.
[59 FR 66755, Dec. 28, 1994]



                  Subpart 605.4--Release of Information



605.403  Requests from members of Congress.

    (a) The Procurement Executive is the agency head for the purposes of 
FAR 5.403(a).
[59 FR 66755, Dec. 28, 1994]



605.404  Release of long-range acquisition estimates.



605.404-1  Release procedures.

    The Procurement Executive is the agency head's designee for the 
purposes of FAR 5.404-1(a) and the agency head for the purposes of FAR 
5.404-1(b).
[55 FR 5774, Feb. 16, 1990]



                   Subpart 605.5--Paid Advertisements



605.502  Authority.

    (a) For paid advertisements in newspapers within the United States, 
the head of the contracting activity is the agency head's designee for 
the purposes of FAR 5.502(a). For acquisitions by overseas posts 
necessitating paid advertisements in newspapers outside the United 
States, the head of the contracting activity is the agency's head's 
designee for the purposes of FAR 5.502(a). When the head of the 
contracting activity is the contracting officer for the acquisition, no 
further approvals are necessary.
[59 FR 66755, Dec. 28, 1994]



PART 606--COMPETITION REQUIREMENTS--Table of Contents




                Subpart 606.1--Full and Open Competition

Sec.
606.101  Policy.
606.101-70  Foreign acquisitions not synopsized.

   Subpart 606.2--Full and Open Competition After Exclusion of Sources

606.202  Establishing or maintaining alternate sources.

           Subpart 606.3--Other Than Full and Open Competition

606.302  Circumstances permitting other than full and open competition.
606.302-1  Only one responsible source and no other supplies or services 
          will satisfy agency requirements.
606.302-4  International agreement.
606.302-6  National security.
606.302-7  Public interest.
606.303-1  Requirements.
606.304  Approval of the Justification.
606.304-70  Acquisitions by overseas posts.
606.370  Department of State standardization program.

                  Subpart 606.5--Competition Advocates

606.501  Requirement.
606.501-70  Overseas posts.
606.570  Solicitation provisions.

    Authority:  40 U.S.C. 486(c); 22 U.S.C. 2658.

    Source:  53 FR 26165, July 11, 1988, unless otherwise noted.



                Subpart 606.1--Full and Open Competition



606.101  Policy.



606.101-70  Foreign acquisitions not synopsized.

    As provided in 605.202-70, overseas posts may exempt certain 
acquisitions from the requirement to synopsize in the Commerce Business 
Daily. A Commerce Business Daily synopsis is not required for domestic 
leases, pursuant to 48 CFR 505.202 and 570.202(a).
[53 FR 26165, July 11, 1988; 53 FR 36461, Sept. 20, 1988, as amended at 
59 FR 66755, Dec. 28, 1994]



   Subpart 606.2--Full and Open Competition After Exclusion of Sources



606.202  Establishing or maintaining alternate sources.

    The Procurement Executive is the agency head for the purposes of FAR 
6.202.

[[Page 507]]



           Subpart 606.3--Other Than Full and Open Competition



606.302  Circumstances permitting other than full and open competition.



606.302-1  Only one responsible source and no other supplies or services will satisfy agency requirements.

    (b)(4) The Procurement Executive is the agency head for the purposes 
of FAR 6.302-1(b)(4).
[59 FR 66755, Dec. 28, 1994]



606.302-4  International agreement.

    (b)(2) In accordance with FAR 6.302-4, guard services shall be 
acquired from the host government only when it is the sole available 
source.
[59 FR 66755, Dec. 28, 1994]



606.302-6  National security.

    (b) This subsection applies to all acquisitions involving national 
security information, regardless of dollar amount. In no case shall 
information be classified in order to restrict competition. Information 
may be classified only when its authorized disclosure could be expected 
to cause damage to national security.
    (c) (1) The Chief, Controls Division, Office of Intelligence 
Liaison, Directorate for Coordination, Bureau of Intelligence and 
Research, is responsible for reviewing and certifying on any proposed 
acquisitions derived from or funded or administered by intelligence 
community agencies that involve sensitive compartmented information and 
ensuring that the provisions of E.O. 12356 and FAR 6.302-6 have been 
met. The Chief, Information Security Programs Division, Office of 
Information Security Technology, Bureau of Diplomatic Security, is 
responsible for reviewing and certifying on all other proposed 
acquisitions funded by the Department of State that involve national 
security information and ensuring that the provisions of E.O. 12356 and 
FAR 6.302-6 have been met. When disclosure of the Department's needs 
through full and open competition would compromise national security, 
the Justification for Other than Full and Open Competition shall include 
the following specific information:
    (i) How national security would be compromised if the Department of 
State's (or other agencies') needs were disclosed in the Commerce 
Business Daily;
    (ii) Why the CBD synopsis cannot be worded in such a manner that 
national security would not be compromised;
    (iii) Necessity for access to classified information to prepare 
technical and/or cost proposal and level of security clearance required;
    (iv) Necessity for access to classified information to perform the 
proposed contract and level of security clearance required;
    (v) Number and value of contracts that the justification covers; and
    (vi) A statement as follows: ``I hereby certify that the national 
security concerns of the referenced acquisition(s) meet the criteria set 
forth in Executive Order 12356 and FAR 6.302-6''.
    (2) Any acquisition involving national security information shall be 
publicized in the Commerce Business Daily unless disclosure of the 
agency's needs would compromise national security.
    (3) The contracting officer is responsible for soliciting offers 
from as many potential sources as is practicable under the 
circumstances. However, given the sensitivity required for acquisitions 
involving national security information, it is expected that 
requirements offices will work closely with the contracting officer in 
maximizing competition.
[59 FR 66755, Dec. 28, 1994]



606.302-7  Public interest.

    The authority to approve the determination prescribed in FAR 6.302-
7(c) is reserved to the Secretary of State.



606.303-1  Requirements.

    Justifications for contract actions prescribed in FAR 6.303-1(d) 
shall be forwarded by the contracting officer to A/OPE for transmittal 
to the Office of the United States Trade Representative.
[53 FR 26165, July 11, 1988, as amended at 59 FR 66755, Dec. 28, 1994]

[[Page 508]]



606.304  Approval of the justification.

    (a) (2) The approval authority for a proposed contract over $100,000 
but not exceeding $1,000,000 for domestic contracting activities that do 
not have a competition advocate is the Department Competition Advocate.
    (d) The estimated dollar value of all options shall be included in 
determining the approval level of a justification.
[59 FR 66755, Dec. 28, 1994]



606.304-70  Acquisitions by overseas posts.

    The Departmental Competition Advocate is the approval authority for 
the purposes of FAR 6.304(a)(3). This authority is not redelegable. Any 
such justification must be transmitted through the Principal Officer at 
the overseas post.
[59 FR 66756, Dec. 28, 1994]



606.370  Department of State standardization program.

    (a) It is the Department's policy to promote full and open 
competition in all procurement actions. The authority at 41 U.S.C. 
253(c)(1) shall be used with respect to standardization when only 
specified makes and models of equipment will satisfy the Department's 
needs and only one source is available. This policy applies to all 
acquisitions involving standardization, regardless of dollar amount.
    (b) Contracts awarded under the authority at 41 U.S.C. 253(c)(1) 
shall be supported by the written justification described in FAR 6.303. 
The contracting officer, requirements office, procuring activity 
competition advocate, and the Procurement Executive shall approve all 
Justifications for Other than Full and Open Competition that cite 
standardization of technical equipment as justification to restrict 
competition. The Administrative Officer at each post is the procuring 
activity competition advocate for that post and the requirements office 
at post is the embassy functional office responsible for identifying the 
need to contract.
    (c) Procurement of specified makes and models of technical equipment 
and systems, for which there is only one source of supply, is considered 
other than full and open competition. Such procurements shall be 
supported by an approved Justification for Other than Full and Open 
Competition. The justification shall include the content requirements of 
FAR 6.303-2. The justification shall also address potential cost savings 
in areas such as inventory, operations, training, maintenance, repairs, 
and administrative and management support. Areas of consideration for 
potential cost savings shall be supported by detailed estimates as 
attachments to the justification. Justifications shall specify an 
effective period, which shall bear a reasonable relationship to the life 
of the technical equipment. The effective period shall not exceed six 
years with a review at the end of the first three years. Periodic 
reviews shall be made during the standardization period to determine 
whether the standardization should be continued, revised or canceled.
[59 FR 66756, Dec. 28, 1994]



                  Subpart 606.5--Competition Advocates



606.501  Requirement.

    (a) The Procurement Executive is the head of the agency for the 
purposes of FAR 6.501 and designates the Department Competition 
Advocate.
    (b) Contracting activity competition advocates have been designated 
for A/FBO and A/OPR/ACQ. The Department Competition Advocate is the 
activity competition advocate for all other domestic contracting 
activities.
[59 FR 66756, Dec. 28, 1994]



606.501-70  Overseas posts.

    The Administrative Officer at each overseas post is the competition 
advocate for that post.



606.570  Solicitation provisions.

    The contracting officer shall insert the provision at 652.206-70, 
Competition Advocacy/Ombudsman, in all solicitations over the threshold 
for using simplified acquisition procedures.
[60 FR 39662, Aug. 3, 1995]

[[Page 509]]



PART 607--ACQUISITION PLANNING--Table of Contents




    Authority:  22 U.S.C. 2658; 40 U.S.C. 486(c); 48 CFR subpart 1.3.



                    Subpart 607.1--Acquisition Plans



607.103  Agency-head responsibilities.

    The Procurement Executive is the agency head's designee for the 
purposes of FAR 7.103.
[55 FR 5774, Feb. 16, 1990]



PART 608--REQUIRED SOURCES OF SUPPLIES AND SERVICES--Table of Contents




    Authority:  40 U.S.C. 486(c); 22 U.S.C. 2658.

    Source:  53 FR 26165, July 11, 1988, unless otherwise noted.



             Subpart 608.3--Acquisition of Utility Services



608.302  Applicability.

    The Procurement Executive is the agency head for the purposes of FAR 
8.302(d)(2)(i).
[55 FR 5774, Feb. 16, 1990]



PART 609--CONTRACTOR QUALIFICATIONS--Table of Contents




               Subpart 609.2--Qualifications Requirements

Sec.
609.202  Policy.

         Subpart 609.4--Debarment, Suspension, and Ineligibility

609.403  Definitions.
609.403-70  DOSAR definitions.
609.404  Parties excluded from procurement programs.
609.405  Effect of listing.
609.405-1  Continuation of current contracts.
609.405-2  Restrictions on subcontracting.
609.405-70  Termination action decision.
609.406  Debarment.
609.406-1  General.
609.406-3  Procedures.
609.407  Suspension.
609.407-1  General.
609.407-3  Procedures.

           Subpart 609.5--Organizational Conflicts of Interest

609.503  Waiver.

    Authority:  40 U.S.C. 486(c); 22 U.S.C. 2658.

    Source:  53 FR 26165, July 11, 1988, unless otherwise noted.



               Subpart 609.2--Qualifications Requirements



609.202  Policy.

    The authority prescribed in FAR 9.202(a)(1) is delegated, without 
power of redelegation, to the head of the contracting activity.
[53 FR 26165, July 11, 1988, as amended at 59 FR 66756, Dec. 28, 1994]



         Subpart 609.4--Debarment, Suspension, and Ineligibility



609.403  Definitions.

    Debarring official means the Procurement Executive.
    Suspending official means the Procurement Executive.



609.403-70  DOSAR definitions.

    Fact-finding official means the chairperson of a three member fact-
finding panel. The panel comprises one representative each from the 
Office of the Legal Adviser, the contracting activity, and the 
requirements office. The representative from the Office of the Legal 
Adviser is the panel chairperson.
    Notice means a written communication sent by certified mail (return 
receipt requested) to the last known address of the party, its 
identified counsel, or its agent. 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 shall then be presumed. This 
definition applies to the notice requirements in FAR 9.406-3 and FAR 
9.407-3.



609.404  Parties excluded from procurement programs.

    A/OPE shall accomplish the agency responsibilities prescribed in FAR 
9.404(c)(1) through (c)(3). The authority to establish procedures 
prescribed in FAR 9.404(c)(5) is delegated, without

[[Page 510]]

power of redelegation, to the head of the contracting activity.
[53 FR 26165, July 11, 1988; 53 FR 36461, Sept. 20, 1988, as amended at 
55 FR 5774, Feb. 16, 1990; 59 FR 66756, Dec. 28, 1994]



609.405  Effect of listing.

    (a) The Procurement Executive is the agency head's designee for the 
purposes of FAR 9.405(a).
    (d) In accordance with a FAR class deviation granted by the 
Procurement Executive, the following actions apply to actions awarded by 
DOS contracting activities:
    (1) (i) Contracting officers at overseas contracting activities may 
rely on the debarment certification submitted by bidders/offerors (FAR 
52.209-5) as proof of eligibility for award when access to the current 
``Lists of Parties Excluded from Procurement Programs'' is not 
reasonably available. For contracts which require A/OPE review and 
approval, the contracting officer should request that A/OPE perform the 
required review if the list is not available.
    (4) (i) For procurement actions (both domestic and overseas) that do 
not exceed the threshold for using simplified acquisition procedures, 
contracting officers need not consult the ``List of Parties Excluded 
from Procurement Programs'' prior to award. The list should be consulted 
whenever the contracting officer has reason to believe that a proposed 
contractor may appear on the list.
    (ii) Contracting officers at domestic contracting activities shall 
review the ``List of Parties Excluded from Procurement Programs'', 
either in hard copy or electronic form, prior to award.
[59 FR 66756, Dec. 28, 1994, as amended at 60 FR 39662, Aug. 3, 1995]



609.405-1  Continuation of current contracts.

    The Procurement Executive is the agency head's designee for the 
purposes of FAR 9.405-1. The decision whether to terminate a current 
contract shall be made in consideration of the circumstances listed in 
609.405-70.



609.405-2  Restrictions on subcontracting.

    The Procurement Executive is the agency head's designee for the 
purposes of FAR 9.405-2.



609.405-70  Termination action decision.

    (a) Prior to making a decision to terminate, based on the 
consideration listed below, the contracting officer shall have the 
proposed action reviewed and approved by:
    (1) The Office of the Legal Adviser;
    (2) An individual one level above the contracting officer; and
    (3) For overseas posts, A/OPE.
    (b) Termination for default. Termination for default under a 
contract's default clause is appropriate when the circumstances giving 
rise to the debarment or suspension also constitute a default in the 
contractor's performance of that contract. Debarment or suspension of 
the contractor for reasons unrelated to the performance of that contract 
may not support a termination for default.
    (c) Termination for convenience or cancellation. Termination for 
convenience or cancellation under appropriate contract clauses should be 
considered when the contractor presents a significant risk to the 
Government in completing a current contract and when such termination 
for convenience or cancellation is determined to be in the Government's 
best interests. In making this determination, the contracting officer 
should consider such factors as the--
    (1) Seriousness of the cause for debarment or suspension;
    (2) Extent of contract performance;
    (3) Potential costs to the Government;
    (4) Urgency of the requirement and the impact of the delay; and/or
    (5) Availability of other safeguards to protect the Government's 
interests.
[53 FR 26165, July 11, 1988, as amended at 59 FR 66756, Dec. 28, 1994]



609.406  Debarment.



609.406-1  General.

    The Procurement Executive is the agency head's designee for the 
purposes of FAR 9.406-1(c).

[[Page 511]]



609.406-3  Procedures.

    (a) Investigation and referral. (1) DOS employees aware of any cause 
that may serve as the basis for debarment shall immediately refer those 
cases through the contracting officer to the debarring official. The 
debarring official shall immediately refer to the Office of the 
Inspector General all reported cases that involve possible criminal or 
fraudulent activities for investigation by that office.
    (2) Referrals for consideration of debarment shall include--
    (i) The cause for debarment (see FAR 9.406-2);
    (ii) A statement of facts;
    (iii) Copies of supporting documentary evidence and a list of all 
necessary or probable witnesses, including addresses and telephone 
numbers, together with a statement concerning their availability to 
appear at a fact-finding proceeding and the subject matter of their 
testimony;
    (iv) A list of all contractors involved, either as principals or as 
affiliates, including current or last known home and business addresses 
and ZIP codes;
    (v) A statement of the acquisition history with such contractors;
    (vi) A statement concerning any known pertinent active or potential 
criminal investigation, criminal or civil court proceedings, or 
administrative claim before Boards of Contract Appeals; and
    (vii) A statement from each DOS organizational element affected by 
the debarment action as to the impact of a debarment on DOS programs.
    (b) Decisionmaking process. (1) If the contractor does not respond 
to a debarment notice within 30 calendar days after receipt of the 
notice, the debarring official may put the debarment into effect.
    (2) In response to the debarment notice, if the contractor or its 
representative notifies the debarring official within 30 days after 
receipt of the notice that it wants to present information and arguments 
in person to the debarring official, that official shall chair such a 
meeting within 20 calendar days of receipt of the request, unless the 
contractor requests a longer period of time. The oral presentation shall 
be conducted informally and a transcript need not be made. However, the 
contractor may supplement its oral presentation with written information 
and arguments for inclusion in the administrative record.
    (3) Pursuant to FAR 9.406-3(b)(2), the contractor may request and 
shall be entitled to a hearing before the fact-finding panel. The fact-
finding panel shall conduct the hearing within 20 calendar days of 
receipt of the request, unless the contractor requests a longer period 
of time.
    (4) The debarring official shall convene the fact-finding panel for 
this purpose and shall provide the panel with a copy of all documentary 
evidence on the matter. Upon receipt of such material, the fact-finding 
official shall notify the contractor and schedule a hearing date.
    (5) In addition to the purposes provided in FAR 9.406-3(b)(2), the 
hearing is intended to provide the debarring official with findings of 
fact based on a preponderance of evidence submitted to the fact-finding 
panel and to provide the debarring official with a determination as to 
whether a cause for debarment exists, based on the facts as found.
    (6) The fact-finding panel shall conduct its hearing in accordance 
with rules promulgated by the fact-finding official. The rules shall be 
as informal as is practicable, consistent with FAR 9.406-3(b) The fact-
finding official is responsible for making the transcribed record of the 
hearing, unless the contractor and the fact-finding panel agree to waive 
the requirement for a transcript.
    (7) The fact-finding official shall deliver written findings and the 
transcribed record, if made, to the debarring official within 10 
calendar days after the hearing. The findings shall resolve any facts in 
dispute based on a preponderance of the evidence presented and recommend 
whether a cause for debarment exists.
    (c) Notice of proposal to debar. (1) Upon receipt of a complete 
referral and after consulting with the Office of the Legal Adviser, the 
debarring official shall decide whether to initiate debarment action.
    (2) When a determination is made to initiate action, the debarring 
official

[[Page 512]]

shall provide to the contractor and any specifically named affiliates 
written notice in accordance with FAR 9.406-3(c). A copy of the notice 
shall be provided to the DOS officer who made the referral and to each 
DOS organizational elements affected by the determination.
    (3) When a determination is made not to initiate action, the 
debarring official shall so advise the DOS officer who made the 
referral.
    (d) Debarring official's decision. In addition to complying with FAR 
9.406-3(d) and FAR 9.406-3(e), the debarring official shall provide 
single copies of the decision to each DOS organizational element 
affected by the decision and to the General Services Administration in 
accordance with 609.404.
[53 FR 26165, July 11, 1988; 53 FR 36461, Sept. 20, 1988]



609.407  Suspension.



609.407-1  General.

    The Procurement Executive is the agency head's designee for the 
purposes of FAR 9.407-1(d).



609.407-3  Procedures.

    (a) Investigation and referral. Investigation and referral shall be 
accomplished as provided in 609.406-3(a), except that referrals made to 
the suspending official shall cite causes pertinent to a suspension 
action (see FAR 9.407-2).
    (b) Decisionmaking process. (1) If the contractor does not respond 
to a notice of suspension within 30 calendar days after receipt of the 
notice, the suspending official may proceed with completion of 
investigation.
    (2) The DOS decisionmaking process for a suspension action pursuant 
to FAR 9.407-3(b) follow those established for a debarment action (see 
609.406(b)), except that the contractor may request and shall be 
entitled to a hearing before the fact-finding panel only if permitted 
under FAR 9.407-3(b)(2).
    (c) Notice of suspension. Notice of suspension shall be accomplished 
as provided in 609.406-3(a), except that the suspending official shall 
process the notice in accordance with FAR 9.407-3(c).
    (d) Suspending official's decision. In addition to complying with 
FAR 9.407-3(d), the suspending official shall provide single copies of 
the decision to each DOS organizational element affected by the decision 
and to the General Services Administration in accordance with 609.404.



           Subpart 609.5--Organizational Conflicts of Interest



609.503  Waiver.

    The Procurement Executive is the agency head's designee for the 
purposes of FAR 9.503.



PART 610--SPECIFICATIONS, STANDARDS, AND OTHER PURCHASE DESCRIPTIONS--Table of Contents




    Authority:  40 U.S.C. 486(c); 22 U.S.C. 2658.



610.002  Policy.



610.002-70  Metric system implementation.

    (a) Policy. The Omnibus Trade and Competitiveness Act of 1988 (Pub. 
L. 100-418) requires Federal agencies to establish implementing 
guidelines pursuant to metric policy established under Sec. 5164 of the 
Act to adopt the metric system as the preferred system of weights and 
measurements for United States trade and commerce. This subsection 
establishes the Department of State metric conversion guidelines for 
transition from the traditional system to the metric system of weights 
and measurements.
    (b) Applicability. This subsection applies to all DOS procurements, 
except to the extent that such use is impractical or is likely to cause 
significant inefficiencies or loss of markets to United States firms.
    (c) Definitions.
    Dual systems means the use of both traditional and metric systems. 
For example, an item is designated, produced and described in inch-pound 
values with soft metric values also shown for information or comparison.
    Hard metric means the use of only standard metric (SI) measurements 
in specifications, standards, supplies and services.

[[Page 513]]

    Hybrid systems means the use of both traditional and hard metric 
values in specifications, standards, supplies and services. For example, 
an engine with internal parts in metric dimensions and external fittings 
or attachments in inch-pound dimensions.
    Measurement sensitive means any item whose application or meaning 
depends substantially on some measured quantity. For example, 
measurement sensitive items include product or performance criteria and 
standards binding on others, such as emission levels, size and weight 
limitations on items in commerce.
    Metrication means any act that increases metric system use, 
including metric training and initiation or conversion of measurement-
sensitive processes and systems to the metric system.
    Metric system means the International System of Units (Le System 
International d'Unites (SI)) of the International Bureau of Weights and 
Measures. The units are listed in Federal Standard 376A, Preferred 
Metric Units for General Use by the Federal Government.
    Soft metric means the result of mathematical conversion of inch-
pound measurements to metric equivalents in specifications, standards, 
supplies and services. The physical dimensions, however, are not 
changed.
    Traditional system of weights and measurements means the predominant 
weight and measurement system currently used in the United States, also 
referred to as the ``inch-pound system''. The traditional system 
includes such commonly used units as inch, foot, yard, mile, pint, 
quart, gallon, bushel, ounce (fluid and avoirdupois), pound, degree 
Fahrenheit, ampere, candela, and second.
    (d) Procedures. (1) DOS contracting activities shall implement the 
metric system in a manner consistent with Pub. L. 100-418.
    (2) All DOS contracting activities shall use the metric system in 
procurement consistent with security, operations, economic, technical, 
logistical, training and safety requirements.
    (3) The Department shall encourage industry to adopt the metric 
system, by acquiring commercially available metric products and services 
that meet the Department's needs whenever practical. Toward this end, 
solicitations for DOS acquisitions shall:
    (i) State all measurement sensitive requirements in metric terms 
whenever possible. Alternatives to hard metric are soft, dual and hybrid 
metric terms. The Metric Handbook for Federal Officials regarding the 
selection of proper metric units and symbols is available for the 
National Technical Information Service (# PB89-226922); and
    (ii) Contracting officers shall return all statements of work/
specifications that are not expressed in some form of metric terms to 
the requirements office that prepared the documents, if the contract is 
expected to exceed $500,000, unless the requirements office has 
forwarded to the contracting activity for approval, in a waiver format 
prescribed by the head of the contracting activity, a justification for 
the use of non-metric specifications/statements of work. Option year 
prices shall be considered when computing the $500,000 threshold.
    (4) Waivers are not required when ordering from Federal Supply 
Schedules, or if the contract is not expected to exceed $500,000.
    (5) Valid justifications for non-metric specifications/word 
statements include, but are not limited to:
    (i) Existing specifications and standards in inch-pound units, 
unless conversions is necessary or advantageous to the Government. 
Unnecessary retrofit of existing systems with new metric components 
shall be avoided if the total cost of the retrofit, including redesign 
costs, exceeds $50,000;
    (ii) When metric is not the accepted industry system with respect to 
a business-related activity, soft metric, hybrid or dual system may be 
used during transition to hard metric; and
    (iii) When the use of metric is impractical or is likely to cause 
significant inefficiencies or loss of markets to United States firms.
    (6) The contracting officer shall review and, if acceptable, approve 
the waiver prepared by the requirements office prior to the release of a 
solicitation that incorporates a specification that is not written in 
some form of

[[Page 514]]

metric, if the resultant contract is expected to exceed $500,000. The 
waiver shall be placed in the contract file. If the waiver is not 
approved, the contracting officer shall return it to the requirements 
office with an explanation.
    (7) The Department's direct in-house operating metric conversion 
costs shall be handled as normal operating expenses rather than as 
special one time costs or included as a budget line item. However, these 
costs are to be identified. Identification includes, but is not limited 
to, the cost of metric aids, tools, equipment, training and increased 
cost to develop metric specifications. All contracting activities and 
requirements offices shall maintain a record of any costs and/or savings 
brought about by metric conversion.
    (8) Bulk (loose, unpacked) materials shall be specified and 
purchased in metric or dual units.
    (9) Measuring devices, shop and laboratory equipment shall be 
purchased in metric or dual units.
    (10) Shipping allowances, bills of lading and other shipping 
documents shall be expressed in metric or dual units.
[59 FR 66756, Dec. 28, 1994, as amended at 60 FR 39662, Aug. 3, 1995]

[[Page 515]]



          SUBCHAPTER C--CONTRACTING METHODS AND CONTRACT TYPES





PART 613--SIMPLIFIED ACQUISITION PROCEDURES--Table of Contents




                         Subpart 613.1--General

Sec.
613.103  Policy.
613.103-70  Acquisition by overseas posts.

                       Subpart 613.4--Imprest Fund

613.403  Conditions for use.

                     Subpart 613.5--Purchase Orders

613.501  General.
613.505  Purchase order and related forms.
613.505-1  Optional Form (OF) 347, Order for Supplies or Services, and 
          Optional Form 348, Order for Supplies or Services Schedule--
          Continuation.
613.505-70  File folders for simplified acquisitions, delivery orders, 
          and blanket purchase agreements.
613.507  Provisions and clauses.
613.507-70  DOSAR clauses.

    Subpart 613.6-70--Governmentwide Commercial Purchase Card Program

613.601-70  Policy.

    Authority:  40 U.S.C. 486(c); 22 U.S.C. 2658.

    Source:  53 FR 26167, July 11, 1988, unless otherwise noted.



                         Subpart 613.1--General



613.103  Policy.



613.103-70  Acquisition by overseas posts.

    Overseas posts shall ensure that the terms and conditions prescribed 
in FAR Part 13 are added or incorporated by reference on the documents 
used for purchase orders from U.S. vendors.
[53 FR 26167, July 11, 1988, as amended at 59 FR 66757, Dec. 28, 1994; 
60 FR 39662, Aug. 3, 1995]



                       Subpart 613.4--Imprest Fund



613.403  Conditions for use.

    The Procurement Executive is the agency head's designee for the 
purposes of FAR 13.403(a).
[53 FR 26167, July 11, 1988. Redesignated and amended at 60 FR 39662, 
Aug. 3, 1995]



                     Subpart 613.5--Purchase Orders



613.501  General.

    The contracting officer shall distribute copies of each purchase 
order in conformance with Subpart 604.2.



613.505  Purchase order and related forms.



613.505-1  Optional Form (OF) 347, Order for Supplies or Services, and Optional Form 348, Order for Supplies or Services Schedule--Continuation.

    (a) The OF-347 and OF-348 shall be mandatory for use by domestic 
contracting activities for issuing purchase orders and delivery orders, 
unless ordering against another Federal agency contract which stipulates 
a different form (e.g., DD-1155, Order for Supplies or Services); or, 
unless the Procurement Executive has approved another form. The OF-347 
may also be used as a voucher.
    (b) In lieu of the OF-347 and OF-348, DOS overseas contracting 
activities may use the Optional Form (OF) 206, Purchase Order, Receiving 
Report and Voucher, and Optional Form 206A, Continuation Sheet 
(illustrated at 653.303-206 and 653.303-206A, respectively). When using 
the OF-206, contracting activities may use Optional Form (OF) 127, 
Receiving and Inspection Report (illustrated at 653.303-127), for that 
purpose.
[60 FR 39662, Aug. 3, 1995]



613.505-70  File folders for simplified acquisitions, delivery orders, and blanket purchase agreements.

    Contracting officers shall use Forms DST-1918, Purchase Order File; 
DST-

[[Page 516]]

1919, Delivery Order File; and, DST-1920, Blanket Purchase Agreement 
(BPA) File, to record relevant data and document those purchases, 
respectively.
[59 FR 66758, Dec. 28, 1994]



613.507  Provisions and clauses.



613.507-70  DOSAR clauses.

    In addition to the FAR provisions and clauses required for or 
applicable to the particular acquisition, each DOS purchase order shall 
incorporate all DOSAR clauses required for or applicable to the 
acquisition. All such clauses shall be listed on a separate document and 
attached to each copy of the purchase order. The document shall be 
identified by the purchase order number and the name and address of the 
contracting activity. The DOSAR clauses may be incorporated without 
setting out full text.
[60 FR 39663, Aug. 3, 1995]



    Subpart 613.6-70--Governmentwide Commercial Purchase Card Program



613.601-70  Policy.

    (a) Scope. This subsection sets forth policy for use of the 
Government purchase card when making small purchases.
    (b) Policy. It is the Department's policy that:
    (1) The purchase card shall be used in preference to other methods 
of procurement (particularly BPAs) for individual purchases up to 
$2,500;
    (2) The purchase card shall be issued primarily to personnel outside 
of the procurement office to purchase products and services up to $2,500 
quickly with a minimum of paperwork and without having to send an 
individual requisition to a procurement office; and,
    (3) The purchase card may be used in procurement offices for 
purchases up to $25,000.
    (c) Procedures. Specific procedures for implementation shall be 
developed by each contracting activity that wishes to participate in the 
program. These procedures shall be approved by A/OPE prior to 
implementation.
[59 FR 66758, Dec. 28, 1994, as amended at 60 FR 39663, Aug. 3, 1995]



PART 614--SEALED BIDDING--Table of Contents




                   Subpart 614.2--Solicitation of Bids

Sec.
614.201  Preparation of Invitation for Bids (IFB).
614.201-7  Contract clauses.
614.201-7  -70  DOSAR contract clauses.

          Subpart 614.4--Opening of Bids and Award of Contract

614.402  Opening of Bids.
614.402-1  Unclassified bids.
614.402-70  Waiver of public opening of bids.
614.404  Rejection of bids.
614.404-1  Cancellation of invitations after opening.
614.406  Mistakes in bids.
614.406-3  Other mistakes disclosed before award.
614.406-4  Mistakes after award.

    Authority:  40 U.S.C. 486(c); 22 U.S.C. 2658.

    Source:  53 FR 26168, July 11, 1988, unless otherwise noted.



                   Subpart 614.2--Solicitation of Bids



614.201  Preparation of Invitation for Bids (IFB).



614.201-7  Contract clauses.



614.201-7-70  DOSAR contract clauses.

    (a) Use of English language solicitations and contracts is mandatory 
unless a deviation has been approved by the Procurement Executive in 
accordance with 601.470. If any part of a contract is not written in the 
English language, the contracting officer shall attach an accurate 
English language translation of such part to the original and each copy 
of the contract, unless the contracting officer determines such action 
is infeasible.
    (b) When contracting by sealed bidding, the contracting officer 
shall insert the clause at 652.214-70, Notices, in all solicitations and 
contracts awarded or performed overseas.
    (c) When contracting by sealed bidding, the contracting officer 
shall insert the provision at 652.214-71, Authorization to Perform, in 
all solicitations

[[Page 517]]

for contracts to be awarded or performed overseas.
[53 FR 26168, July 11, 1988, as amended at 59 FR 66758, Dec. 28, 1994]



          Subpart 614.4--Opening of Bids and Award of Contract



614.402  Opening of bids.



614.402-1  Unclassified bids.

    After the unclassified bids have been opened pursuant to FAR 14.402-
1, the bid opening officer shall announce that the opening of bids has 
been completed and that all bidders will be notified as soon as possible 
regarding the award.



614.402-70  Waiver of public opening of bids.

    Overseas posts may request waiver of the public opening of bids if 
that activity is inconsistent with local law or legal practice, or with 
post security. For that purpose, the Procurement Executive must approve 
a deviation in accordance with 601.470.



614.404  Rejection of bids.



614.404-1  Cancellation of invitations after opening.

    The authority to make the determination prescribed in FAR 14.404-
1(c) is delegated, without power of redelegation, to the head of the 
contracting activity. The head of the contracting activity shall obtain 
the concurrence of the Office of the Legal Adviser before making a 
determination pursuant to this subsection.
[53 FR 26168, July 11, 1988, as amended at 59 FR 66758, Dec. 28, 1994]



614.406  Mistakes in bids.



614.406-3  Other mistakes disclosed before award.

    The authority to make the determinations prescribed in FAR 14.406 is 
delegated, without power of redelegation, to the head of the contracting 
activity. In conformance with FAR 14.406-3(f), the head of the 
contracting activity shall obtain the concurrence of the Office of the 
Legal Adviser before making any determinations pursuant to this 
subsection.



614.406-4  Mistakes after award.

    The authority to make all determinations prescribed in FAR 14.406-4 
is delegated, without power of redelegation, to the head of the 
contracting activity. In conformance with FAR 14.406-4(d), the head of 
the contracting activity shall consult with the Office of the Legal 
Adviser before making any determinations pursuant to this subsection.



PART 615--CONTRACTING BY NEGOTIATION--Table of Contents




          Subpart 615.1--General Requirements for Negotiations

Sec.
615.106  Contract clauses.
615.106-1  Examination of Records clause.
615.106-70  DOSAR contract clauses.

   Subpart 615.4--Solicitation and Receipt of Proposals and Quotations

615.403  Solicitation mailing lists.
615.404  Presolicitation notices and conferences.
615.406  Preparing requests for proposals (RFP's) and requests for 
          quotations (RFQ's).
615.406-1  Uniform contract format.
615.413  Disclosure and use of information before award.
615.413-2  Alternate II.

                  Subpart 615.5--Unsolicited Proposals

615.504  Advance guidance.
615.506  Agency procedures.

                     Subpart 615.6--Source Selection

615.604  Responsibilities.
615.607  Disclosure of mistakes before award.
615.608  Proposal evaluation.
615.612  Formal source selection.

                    Subpart 615.8--Price Negotiation

615.804  Cost or pricing data.
615.804-3  Exemptions from or waiver of submission of certified cost or 
          pricing data.

    Authority:  40 U.S.C. 486(c); 22 U.S.C. 2658.

    Source:  53 FR 26168, July 11, 1988, unless otherwise noted.

[[Page 518]]



           Subpart 615.1--General Requirements for Negotiation



615.106  Contract clauses.



615.106-1  Examination of Records clause.

    See Subpart 625.9 for conditions for omission of the Examination of 
Records clause.



615.106-70  DOSAR contract clauses.

    When contracting by negotiation, the contracting officer shall 
insert the clauses at 652.214-70, Notices, and 652.214-71, Authorization 
to Perform, in all solicitations and contracts, under the same 
conditions prescribed in 614.201-7-70.
[53 FR 26168, July 11, 1988, as amended at 59 FR 66758, Dec. 28, 1994]



   Subpart 615.4--Solicitation and Receipt of Proposals and Quotations

    Source:  59 FR 66758, Dec. 28, 1994, unless otherwise noted.



615.403  Solicitation mailing lists.

    Contracting officers shall release copies of solicitation mailing 
lists in accordance with FAR 14.205-5(a). However, the list of those 
firms which actually submitted proposals is not releasable. Requests for 
information other than solicitation mailing lists shall be handled by 
the Department's Office of Freedom of Information.



615.404  Presolicitation notices and conferences.

    (c)(1) The Procurement Executive has approved a class deviation from 
the requirements of FAR 15.404(c)(1). Approval for presolicitation 
conferences at one level above the contracting officer is not required.



615.406  Preparing requests for proposals (RFP's) and requests for quotations (RFQ's).



615.406-1  Uniform contract format.

    (a) The uniform contract format shall be mandatory for all 
acquisitions outside the United States, its possessions, its 
territories, and Puerto Rico, with the exception of those contracts 
listed in FAR 15.406-1(a) (1) through (8), unless a waiver is granted by 
the Procurement Executive. The Procurement Executive is the agency 
head's designee for the purposes of FAR 15.406-1(a)(7).



615.413  Disclosure and use of information before award.



615.413-2  Alternate II.

    Contracting officers may determine to use the alternate procedures 
listed in FAR 15.413-2 in cases deemed appropriate. These procedures 
must be used when releasing proposals outside the Government for 
evaluation purposes.
    (e) Contracting officers shall place the notice specified in FAR 
15.413-2(e) on all proposals when using these alternate procedures.
    (f) Release of proposals outside the Government is authorized.
    (1) The Procurement Executive is the agency head's designee for the 
purposes of FAR 15.413-2(f)(1).



                  Subpart 615.5--Unsolicited Proposals



615.504  Advance guidance.

    (a) The contact points for unsolicited proposals are the heads of 
the contracting activities.
[59 FR 66758, Dec. 28, 1994]



615.506  Agency procedures.

    (a) The contact points shall ensure that unsolicited proposals are 
controlled, evaluated, safeguarded, and disposed of in accordance with 
FAR Subpart 15.5.
[59 FR 66758, Dec. 28, 1994]



                     Subpart 615.6--Source Selection



615.604  Responsibilities.

    (a) The head of the contracting activity is the agency head's 
designee for the purposes of FAR 15.604(a).
[59 FR 66759, Dec. 28, 1994]



615.607  Disclosure of mistakes before award.

    The authority to make the determination prescribed in FAR 
15.607(c)(3)

[[Page 519]]

is delegated, without power of redelegation, to the head of the 
contracting activity. In conformance with FAR 15.607(c)(3)(ii), the head 
of the contracting activity shall obtain the concurrence of the Office 
of the Legal Adviser before making a determination pursuant to this 
subsection.
[53 FR 26168, July 11, 1988, as amended at 59 FR 66759, Dec. 28, 1994]



615.608  Proposal evaluation.

    The authority to make the determination prescribed in FAR 15.608(b) 
is delegated, without power of redelegation, to the head of the 
contracting activity. The head of the contracting activity shall obtain 
the concurrence of the Office of the Legal Adviser before making a 
determination pursuant to this section.
[53 FR 26168, July 11, 1988, as amended at 59 FR 66759, Dec. 28, 1994]



615.612  Formal source selection.

    The authority prescribed in FAR 15.612(b), including the authority 
to designate a source selection authority, is delegated, without power 
of redelegation, to the head of the contracting activity.



                    Subpart 615.8--Price Negotiation



615.804  Cost or pricing data.



615.804-3  Exemptions from or waiver of submission of certified cost or pricing data.

    The waiver authority prescribed in FAR 15.804-3(i) is delegated, 
without power of redelegation, to the head of the contracting activity.



PART 616--TYPES OF CONTRACTS--Table of Contents




Sec.
616.000  Scope of part.

                 Subpart 616.1--Selecting Contract Types

616.102  Policies.
616.102-70  Overseas posts.

                  Subpart 616.2--Fixed-Price Contracts

616.203  Fixed-price contracts with economic price adjustment.
616.203-4  Contract clauses.
616.207  Firm-fixed-price, level-of-effort term contracts.
616.207-3  Limitations.

               Subpart 616.3--Cost-Reimbursement Contracts

616.301-3  Limitations.
616.306  Cost-plus-fixed-fee contracts.

              Subpart 616.5--Indefinite-Delivery Contracts

616.505  Contract clauses.
616.505-70  DOSAR contract clause.

   Subpart 616.6--Time-and-Materials, Labor-Hour, and Letter Contracts

616.603  Letter contracts.
616.603-2  Application.

    Authority:  40 U.S.C. 486(c); 22 U.S.C. 2658.

    Source:  53 FR 26169, July 11, 1988, unless otherwise noted.



616.000  Scope of part.

    The contracting officer may use any of the contract types described 
in FAR part 16 for acquisitions made under simplified acquisition 
procedures. The contracting officer shall document his/her decision to 
use a contract type in accordance with the requirements of FAR part 16.
[60 FR 39963, Aug. 3, 1995]



                 Subpart 616.1--Selecting Contract Types



616.102  Policies.



616.102-70  Overseas posts.

    Pursuant to 601.603-70(a)(1)(i), no authority is delegated to 
overseas posts to enter into cost-reimbursement, fixed-price incentive, 
or fixed-price redeterminable contracts, unless the Procurement 
Executive's approval is obtained. Such requests shall be submitted by 
the head of the contracting activity on a case-by-case basis.
[59 FR 66759, Dec. 28, 1994]

[[Page 520]]



                  Subpart 616.2--Fixed-Price Contracts



616.203  Fixed-Price contracts with economic price adjustment.



616.203-4  Contract clauses.

    Contracting officers at domestic contracting activities may use an 
economic price adjustment clause based on cost indexes of labor or 
material in accordance with the circumstances listed in FAR 16.203-4(d) 
and after obtaining the approval of the head of the contracting 
activity. Overseas posts may use the clause at 652.216-71, Price 
Adjustment, when procuring continuing services (e.g., guard, janitorial, 
building maintenance, and gardening). Posts shall obtain A/OPE approval 
for any price adjustment clause that differs from the clause at 652.216-
71.
[53 FR 26169, July 11, 1988, as amended at 59 FR 66759, Dec. 28, 1994]



616.207  Firm-fixed-price, level-of-effort term contracts.



616.207-3  Limitations.

    The head of the contracting activity is the chief of the contracting 
office for the purposes of FAR 16.207-3.



               Subpart 616.3--Cost-Reimbursement Contracts



616.301-3  Limitations.

    The determination and findings prescribed in FAR 16.301-3(c) shall 
be executed by the contracting officer.
[53 FR 26169, July 11, 1988, as amended at 59 FR 66759, Dec. 28, 1994]



616.306  Cost-plus-fixed-fee contracts.

    The authority to make the determination prescribed in FAR 
16.306(c)(2) is delegated to the head of the contracting activity. This 
authority may be redelegated.
[53 FR 26169, July 11, 1988, as amended at 59 FR 66759, Dec. 28, 1994]



              Subpart 616.5--Indefinite-Delivery Contracts



616.505  Contract clauses.



616.505-70  DOSAR contract clause.

    The contracting officer shall insert the clause at 652.216-70, 
Ordering--Indefinite-Delivery Contract, whenever the clause at FAR 
52.216-20, Definite Quantity, or the clause at FAR 52.216-21, 
Requirements, or the clause at FAR 52.216-22, Indefinite Quantity, is 
used.



   Subpart 616.6--Time-and-Materials, Labor-Hour, and Letter Contracts



616.603  Letter contracts.



616.603-2  Application.

    The contracting officer, after obtaining approval of the head of the 
contracting activity, is authorized to extend the period to definitize a 
letter contract in accordance with FAR 16.603-2(c) and when such action 
is in the best interest of the Government. For this purpose, the 
contracting officer shall execute a written determination and findings, 
and submit it to the head of the contracting activity for approval. For 
cases where the contracting officer is also the head of the contracting 
activity, the Procurement Executive shall approve the determination and 
findings.
[53 FR 26169, July 11, 1988; 53 FR 36462, Sept. 20, 1988, as amended at 
59 FR 66759, Dec. 28, 1994]



PART 617--SPECIAL CONTRACTING METHODS--Table of Contents




                  Subpart 617.1--Multiyear Contracting

Sec.
617.102  Policy.
617.102-2  General.
617.102-3  Objectives.

                         Subpart 617.2--Options

617.201  Definitions.
617.201-70  DOSAR Definitions.
617.204  Contracts.

[[Page 521]]

      Subpart 617.5--Interagency Acquisitions Under the Economy Act

617.502  General.
617.504-70  Ordering procedures.

            Subpart 617.6--Management and Operating Contracts

617.602  Policy.

    Authority:  40 U.S.C. 486(c); 22 U.S.C. 2658.

    Source:  53 FR 26169, July 11, 1988, unless otherwise noted.



                  Subpart 617.1--Multiyear Contracting



617.102  Policy.



617.102-2  General.

    (a) Pursuant to section 14 of the State Department Basic Authorities 
Act of 1956, as amended (22 U.S.C. 2679a), any DOS acquisition for 
property or services, or both, by any contract funded on the basis of 
annual appropriations may nevertheless be made for periods not in excess 
of 5 years when--
    (1) Appropriations are available and adequate for payment for the 
first fiscal year and for all potential cancellation costs; and
    (2) The Procurement Executive determines that--
    (i) The need of the Government for the property or services being 
acquired over the period of the contract is reasonably firm and 
continuing;
    (ii) Such a contract will serve the best interests of the Government 
by encouraging effective competition or promoting economies in 
performance and operation; and
    (iii) Such a method of contracting will not inhibit small business 
participation.
    (b) For overseas posts, the Procurement Executive may delegate to 
the Principal Officer, on an individual contract or class of contracts 
basis, the authority to make the determination required by paragraph 
(a)(2) above. The Principal Officer may not redelegate this authority.
    (c) In the event that funds for the continuation of such a contract 
are not made available into a subsequent fiscal year, the contract shall 
be canceled. Any cancellation costs incurred shall be paid from 
appropriations originally available for the performance of the contract, 
appropriations currently available for the acquisition of similar 
property or services and not otherwise obligated, or appropriations made 
for such cancellation payments.
    (d) Any multiyear contract awarded pursuant to this subsection shall 
not exceed 5 years, including options, in accordance with FAR Subpart 
17.2, unless approved by the Procurement Executive in accordance with 
DOSAR 617.204(e).
[53 FR 26169, July 11, 1988, as amended at 59 FR 66759, Dec. 28, 1994]



617.102-3  Objectives.

    (d)(3) The head of the contracting activity is the agency head's 
designee for the purposes of FAR 17.102-3(d)(3). For those cases where 
the contracting officer is also the head of the contracting activity, 
the Procurement Executive shall be the agency head's designee.
[59 FR 66759, Dec. 28, 1994]



                         Subpart 617.2--Options



617.201  Definitions.



617.201-70  DOSAR Definitions.

    Evaluated option means an option that is evaluated for award 
purposes by adding the total price for the option(s) to the total price 
for the basic requirement.
    Price option means an option where the amount for the option is 
specified in or is reasonably determinable from the terms of the basic 
contract, as described in FAR 17.207(f) (1) through (5).
    Unevaluated option means an option that is not included in the 
evaluation for award purposes.
    Unpriced option means an option where the prices for the option 
quantities or performance periods are not specified in the contract at 
the time of award and the option prices are negotiated at the time the 
option is exercised.
[53 FR 26169, July 11, 1988, as amended at 59 FR 66759, Dec. 28, 1994]



617.204  Contracts.

    (e) The Procurement Executive shall approve any solicitations or 
contracts

[[Page 522]]

which exceed the five (5) year maximum length for supplies or services.
[59 FR 66759, Dec. 28, 1994]



      Subpart 617.5--Interagency Acquisitions Under the Economy Act



617.502  General.

    The authority to make the determination prescribed in FAR 17.502 is 
delegated to the head of the contracting activity.
[53 FR 26169, July 11, 1988, as amended at 59 FR 66759, Dec. 28, 1994]



617.504-70  Ordering procedures.

    (a) Department deputy assistant secretaries are authorized to 
execute Economy Act IAAs. Department contracting officers also are 
authorized to execute Economy Act IAAs, as prescribed in FAR 17.504(a).
    (b) Department of State form DS-1921, Award/Modification of 
Interagency Acquisition Agreement (illustrated in part 653), shall be 
used for all Economy Act IAAs where the Department is the requesting 
agency. It shall also be used for Economy Act IAAs where the Department 
is the servicing agency if the requesting agency does not have a similar 
form that provides the same information.
[59 FR 66759, Dec. 28, 1994]



            Subpart 617.6--Management and Operating Contracts



617.602  Policy.

    The Assistant Secretary for Administration is the agency head for 
the purposes of FAR 17.602.

[[Page 523]]



                  SUBCHAPTER D--SOCIOECONOMIC PROGRAMS





PART 619--SMALL BUSINESS AND SMALL DISADVANTAGED BUSINESS CONCERNS--Table of Contents




                         Subpart 619.2--Policies

Sec.
619.201  General policy.

    Subpart 619.4--Cooperation with the Small Business Administration

619.402  Small Business Administration procurement center 
          representatives.
619.402-70  DOS designee.

              Subpart 619.5--Set-Asides for Small Business

619.501  General.
619.505  Rejecting set-aside recommendations.
619.506  Withdrawing or modifying set asides.

    Subpart 619.6--Certificates of Competency and Determinations of 
                               Eligibility

619.602  Procedures.
619.602-1  Referral.

      Subpart 619.7--Subcontracting with Small Business and Small 
                     Disadvantaged Business Concerns

619.705  Responsibilities of the contracting officer under the 
          subcontracting assistance program.
619.705-1  General support of the program.
619.705-3  Preparing the solicitation.
619.705-4  Reviewing the subcontracting plan.
619.705-6  Postaward responsibilities of the contracting officer.
619.705-6  -70  Reporting responsibilities.
619.708-70  Solicitation provisions and contract clauses.

 Subpart 619.8--Contracting With the Small Business Administration (the 
                              8(a) Program)

619.801  Definitions.
619.803  Selecting acquisitions for the 8(a) program.
619.803-70  Responsibilities of the Office of Small and Disadvantaged 
          Business Utilization (A/SDBU).
619.810  SBA appeals.
619.812  Contract administration.
619.870  Acquisition of technical requirements.

    Authority:  40 U.S.C. 486(c); 22 U.S.C. 2658.

    Source:  53 FR 26170, July 11, 1988, unless otherwise noted.



                         Subpart 619.2--Policies



619.201  General policy.

    (a) The Operations Director, Office of Small and Disadvantaged 
Business Utilization (A/SDBU), is responsible for performing all 
functions and duties prescribed in FAR 19.201 (c) and (d).
    (b) In addition to the requirements of FAR 19.201(b), each head of 
the contracting activity (see 601.603-70), or designee, is responsible 
for establishing in coordination with the A/SDBU Operations Director 
annual goals for the DOS small and disadvantaged business program.
    (c) The Assistant Secretary of State for Administration is the 
agency head for the purposes of FAR 19.201(c).
    (d) Pursuant to FAR 19.201(d), each Small and Disadvantaged Business 
Utilization Specialist (SDBUS) is responsible for--
    (1) Maintaining a program to locate capable small business, small 
disadvantaged business, and women-owned business sources to fulfill DOS 
acquisition requirements;
    (2) Coordinating inquiries and requests for advice from small 
business, small disadvantaged business, and women-owned business sources 
on DOS contracting and subcontracting opportunities and other 
acquisition matters;
    (3) Advising contracting activities on new or revised small 
business, small disadvantaged business, or women-owned business 
policies, regulations, procedures, and other related information;
    (4) Assuring that small business, small disadvantaged business and 
women-owned business concerns are provided adequate specifications or 
drawings by initiating actions, in writing, with appropriate technical 
and contracting personnel to ensure that all necessary specifications or 
drawings for current and future acquisitions, as appropriate, are 
available;
    (5) Reviewing all proposed acquisitions in excess of the simplified 
aquisition limitation to assure that

[[Page 524]]

small business, small disadvantaged business, and women-owned business 
sources will be afforded an equitable opportunity to compete and, as 
appropriate, initiating recommendations for small business or small 
disadvantaged business set-asides. This includes proposed contract 
modifications for new or additional requirements which do not fall 
within the original scope of the contract and which exceed the 
simplified acquisition threshold. This does not include the exercising 
of contract options;
    (6) Assuring that contract financing available under existing 
regulations is offered when appropriate and that requests by small 
business concerns for such financing are not treated as a handicap in 
the award of contracts;
    (7) Providing assistance to the contracting officer in making 
determinations concerning responsibility of prospective contractors 
whenever small business concerns are involved;
    (8) Participating in the evaluation of a prime contractor's small 
business and small disadvantaged business subcontracting plans;
    (9) Assuring that the participation of small business, small 
disadvantaged business, and women-owned business concerns is accurately 
reported;
    (10) Attending, as appropriate, debriefings to unsuccessful small 
business and small disadvantaged business concerns to assist those firms 
in understanding requirements for responsiveness and responsibility so 
that the firm may be able to qualify for future awards;
    (11) Making available to SBA copies of solicitations when so 
requested;
    (12) When a bid or offer from a small business, small disadvantaged 
business, or women-owned business has been rejected for 
nonresponsiveness or nonresponsibility, upon request, aid, counsel, and 
assist that firm in understanding requirements for responsiveness and 
responsibility so that the firm may be able to qualify for future 
awards;
    (13) Participating in Government-industry conferences to assist 
small business, small disadvantaged business and women-owned business 
concerns, including Business Opportunity/Federal Acquisition 
Conferences, Minority Business Enterprises Acquisition Seminars and 
Business Opportunity Committee meetings;
    (14) Maintaining a list of supplies and services that have been 
placed as repetitive small business set-asides;
    (15) Participating in the development, implementation, and review of 
automated source systems to assure that the interests of small business, 
small disadvantaged business, and women-owned business concerns are 
fully considered;
    (16) Advising potential sources how they can obtain information 
about competitive acquisitions;
    (17) Providing small business, small disadvantaged business, and 
women-owned business sources information regarding assistance available 
from Federal agencies such as the Small Business Administration, 
Minority Business Development Agency, Bureau of Indian Affairs, Economic 
Development Administration, National Science Foundation, Department of 
Labor and others, including State agencies and trade associations; and
    (18) Participating in interagency programs relating to small 
business, small disadvantaged business, and labor surplus area matters 
as authorized by the A/SDBU Operations Director.
[53 FR 26170, July 11, 1988, as amended at 59 FR 66759, Dec. 28, 1994; 
60 FR 39663, Aug. 3, 1995]



    Subpart 619.4--Cooperation with the Small Business Administration



619.402  Small Business Administration procurement center representatives.



619.402-70  DOS designee.

    Where the FAR requires action by a Small Business Administration 
procurement center representative, but one has not been assigned to the 
DOS contracting activity, the A/SDBU Operations Director shall perform 
the action so required.



              Subpart 619.5--Set-Asides for Small Business



619.501  General.

    (c) Contracting officers shall use Department of State Form DS-1910, 
Small Business/Labor Surplus Area Review--

[[Page 525]]

Actions Above the Simplified Acquisition Threshold, to document set-
aside decisions.
[59 FR 66759, Dec. 28, 1994, as amended at 60 FR 39663, Aug. 3, 1995]



619.505  Rejecting set-aside recommendations.

    The Procurement Executive is the agency head for the purposes of FAR 
19.505.



619.506  Withdrawing or modifying set asides.

    (b) The Procurement Executive shall resolve disagreements between 
the A/SDBU Operations Director and the contracting officer.
[59 FR 66759, Dec. 28, 1994]



    Subpart 619.6--Certificates of Competency and Determinations of 
                               Eligibility



619.602  Procedures.



619.602-1  Referral.

    The contracting officer shall transmit to the A/SDBU Operations 
Director concurrently with the submission to the appropriate SBA 
Regional Office, a copy of the documentation supporting the 
determination that a small business concern is not responsible, as 
required by FAR 19.602-1(a).



      Subpart 619.7--Subcontracting with Small Business and Small 
                     Disadvantaged Business Concerns



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



619.705-1  General support of the program.

    It is the Department's policy to incorporate its current fiscal year 
goals as negotiated with the SBA into all pertinent Department 
solicitations, in addition to the standard subcontract clauses. 
Incorporation of the goals does not require that large business prime 
contractors must subcontract, but does require that to the extent they 
plan to subcontract, specific goals be established for doing business 
with small, small disadvantaged, and women-owned firms. Where funds are 
available, an incentive clause such as that found in FAR 52.219-10, 
Incentive Subcontracting Program for Small and Small Disadvantaged 
Business Concerns, is encouraged.
[59 FR 66760, Dec. 28, 1994]



619.705-3  Preparing the solicitation.

    Whenever the clause at FAR 52.219-9, Small Business and Small 
Disadvantaged Business Subcontracting Program, is used in a solicitation 
for a negotiated acquisition, a notification also must be included in 
the solicitation. This notification shall advise prospective offerors 
that subcontracting plans may be requested from all concerns determined 
to be in the competitive range. To further promote the use of small, 
disadvantaged, and women-owned firms by large prime contractors, 
contracting officers are encouraged to consider the adequacy of the 
subcontracting plans, and/or past performance in achieving negotiated 
subcontract goals, as part of the overall evaluation of the technical 
proposals.
[53 FR 26170, July 11, 1988, as amended at 59 FR 66760, Dec. 28, 1994]



619.705-4  Reviewing the subcontracting plan.

    A/SDBU shall review subcontracting plans to determine if small and 
small disadvantaged businesses are afforded the maximum practicable 
opportunity to participate as subcontractors. A/SDBU shall recommend to 
the contracting officer changes needed to subcontracting plans found to 
be deficient.



619.705-6  Postaward responsibilities of contracting officer.



619.705-6-70  Reporting responsibilities.

    (a) The contracting officer shall forward to the A/SDBU Operations 
Director a copy of each subcontracting plan that was incorporated into a 
contract or contract modification. Each contracting activity shall 
maintain a list of its active prime contracts that contain 
subcontracting plans.
    (b) Contracting officers shall collect subcontracting data from 
contractors required to establish subcontracting

[[Page 526]]

plans in support of small and small disadvantaged business concerns. 
This data shall be collected annually and semiannually, using Standard 
Form 295, Summary Subcontracting Report, for the annual submissions, and 
Standard Form 294, Subcontracting Report for Individual Contracts, for 
the semiannual submissions. The head of the contracting activity shall 
forward these reports to the A/SDBU Operations Director, not later than 
the 30th day of the month following the close of the reporting period.
[53 FR 26170, July 11, 1988, as amended at 59 FR 66760, Dec. 28, 1994]



619.708-70  Solicitation provisions and contract clauses.

    The contracting officer shall insert a provision substantially the 
same as the provision at 652.219-70, Department of State Subcontracting 
Goals, in solicitations whenever the clause at FAR 52.219-9, Small 
Business and Small Disadvantaged Business Subcontracting Plan, is used.
[59 FR 66760, Dec. 28, 1994]



 Subpart 619.8--Contracting with the Small Business Administration (the 
                              8(a) Program)



619.801  Definitions.

    National buy requirements includes all 8(a) contracts performed 
outside the United States and processed by the Small Business 
Administration.
[59 FR 66760, Dec. 28, 1994]



619.803  Selecting acquisitions for the 8(a) program.



619.803-70  Responsibilities of the Office of Small and Disadvantaged Business Utilization (A/SDBU).

    A/SDBU shall review the capabilities of 8(a) concerns and 
disseminate that information to DOS program and contracting personnel. 
As necessary, A/SDBU shall obtain from the SBA or 8(a) concerns 
supplemental information for DOS program and contracting personnel.



619.810  SBA appeals.

    The Procurement Executive is the agency head for the purposes of FAR 
19.810.
[59 FR 66760, Dec. 28, 1994]



619.812  Contract administration.

    (d) The Procurement Executive is the agency head for the purposes of 
FAR 19.812(d).
[59 FR 66760, Dec. 28, 1994]



619.870  Acquisition of technical requirements.

    (a) Offering Letter. When a decision has been made by the A/SDBU and 
contracting officer to process an acquisition through the SBA under the 
8(a) program, the contracting activity shall promptly send to the 
applicable SBA office a letter offering the acquisition to the SBA, with 
an information copy to the SDBUS. The offering letter should transmit 
the statement of work, purchase description, technical data package, or 
specifications and such other information deemed necessary by the 
contracting officer.
    (b) The contracting officer has greater latitude in holding 
discussions with the concerns solicited under an 8(a) program 
acquisition if under the $3 million competitive threshold for 8(a) 
competition than under a non-8(a) program acquisition. Informal 
assessments of 8(a) concerns shall be within the parameters of 13 CFR 
124.308(g). The technical evaluation must be carefully reviewed to 
determine if any source declared to be unacceptable is capable of being 
made acceptable.
[53 FR 26170, July 11, 1988, as amended at 59 FR 66760, Dec. 28, 1994]



PART 622--APPLICATION OF LABOR LAWS TO GOVERNMENT ACQUISITIONS--Table of Contents




       Subpart 622.3--Contract Work Hours and Safety Standards Act

Sec.
622.302  Liquidated damages and overtime pay.

[[Page 527]]

   Subpart 622.4--Labor Standards for Contracts Involving Construction

622.401  Definitions.
622.404  Davis-Bacon Act wage determinations.
622.404-3  Procedures for requesting wage determinations.
622.404-6  Modifications of wage determinations.
622.404-7  Correction of wage determinations containing clerical errors.
622.404-11  Wage determination appeals.
622.406  Administration and enforcement.
622.406-1  Policy.
622.406-3  Additional classifications.
622.406-8  Investigations.
622.406-9  Withholding from or suspension of contract payments.
622.406-10  Disposition of disputes concerning construction contract 
          labor standards enforcement.
622.406-11  Contract terminations.
622.406-12  Cooperation with the Department of Labor.

            Subpart 622.6--Walsh-Healey Public Contracts Act

622.604  Exemptions.
622.604-2  Regulatory exemptions.

               Subpart 622.8--Equal Employment Opportunity

622.807  Exemptions.

        Subpart 622.13--Special Disabled and Vietnam Era Veterans

622.1303  Waivers.
622.1308  Contract clauses.

              Subpart 622.14--Employment of the Handicapped

622.1403  Waivers.
622.1408  Contract clause.

    Authority:  40 U.S.C. 486(c); 22 U.S.C. 2658.

    Source:  53 FR 26172, July 11, 1988, unless otherwise noted.



       Subpart 622.3--Contract Work Hours and Safety Standards Act



622.302  Liquidated damages and overtime pay.

    The authority to make the determination prescribed in FAR 22.302(c) 
is delegated, without power of redelegation, to the head of the 
contracting activity.
[55 FR 5774, Feb. 16, 1990]



   Subpart 622.4--Labor Standards for Contracts Involving Construction

    Source:  55 FR 5774, Feb. 16, 1990, unless otherwise noted.



622.401  Definitions.

    (b) Apprentices, trainees, helpers, and, in the case of contracts 
subject to the Contract Work Hours and Safety Standards Act, watchmen 
and guards. The terms ``apprentice'' and ``trainee'' are defined as 
follows:
    (1) Apprentice has the same definition as in FAR 22.401(b)(1).
    (2) Trainee has the same definition as in FAR 22.401(b)(2).
    (3) The definition for helper as described in FAR 22.401 paragraph 
(b)(3) of the definition of Laborers or mechanics is reserved.
[59 FR 66760, Dec. 28, 1994]



622.404  Davis-Bacon Act wage determinations.



622.404-3  Procedures for requesting wage determinations.

    The cognizant contracting activity (see 601.603-70) is the 
contracting agency for the purposes of FAR 22.404-3(b) and (e)



622.404-6  Modifications of wage determinations.

    The cognizant contracting activity is the contracting agency for the 
purposes of FAR 22.404-6.
    (b)(6) The head of the contracting activity is the agency head's 
designee for the purposes of FAR 22.404-6(b)(6).
[55 FR 5774, Feb. 16, 1990, as amended at 59 FR 66760, Dec. 28, 1994]



622.404-7  Correction of wage determinations containing clerical errors.

    The cognizant contracting activity is the contracting agency for the 
purposes of FAR 22.404-7.



622.404-11  Wage determination appeals.

    The cognizant contracting activity is the contracting agency for the 
purposes of FAR 22.404-11.

[[Page 528]]



622.406  Administration and enforcement.



622.406-1  Policy.

    The cognizant contracting activity is the contracting agency for the 
purposes of FAR 22.406-1(a).



622.406-3  Additional classifications.

    (b)(4) FAR 22.406-3 paragraph (b)(4) is reserved.
[59 FR 66760, Dec. 28, 1994]



622.406-8  Investigations.

    (a) The chief of the contracting activity is responsible for 
conducting labor standards investigations as prescribed in FAR 22.406-
8(a).
    (d) The Procurement Executive is the agency head's designee for the 
purposes of FAR 22.406-8(d).



622.406-9  Withholding from or suspension of contract payments.

    The authority to suspend contract payments pursuant to FAR 22.406-
9(b) is delegated, without power of redelegation, to the head of the 
contracting activity.



622.406-10  Disposition of disputes concerning construction contract labor standards enforcement.

    The cognizant contracting activity is the contracting agency for the 
purposes of FAR 22.406-10(b).



622.406-11  Contract terminations.

    The cognizant contracting activity is the contracting agency for the 
purposes of FAR 22.406-11.



622.406-12  Cooperation with the Department of Labor.

    Any information furnished to the Department of Labor pursuant to FAR 
22.406-12(a) shall be submitted through the head of the contracting 
activity.



            Subpart 622.6--Walsh-Healey Public Contracts Act



622.604  Exemptions



622.604-2  Regulatory exemptions.

    The Procurement Executive is the agency head for the purposes of FAR 
22.604-2(c)(1).



               Subpart 622.8--Equal Employment Opportunity



622.807  Exemptions.

    The Procurement Executive is the agency head for the purposes of FAR 
22.807(a)(1).



        Subpart 622.13--Special Disabled and Vietnam Era Veterans



622.1303  Waivers.

    The Procurement Executive is the agency head for the purposes of FAR 
22.1303.



622.1308  Contract clauses.

    The Procurement Executive is the agency head for the purposes of FAR 
22.1308 (a)(2) and (c).
[55 FR 5775, Feb. 16, 1990]



              Subpart 622.14--Employment of the Handicapped



622.1403  Waivers.

    The Procurement Executive is the agency head for the purposes of FAR 
22.1403.



622.1408  Contract clause.

    The Procurement Executive is the agency head for the purposes of FAR 
22.1408.
[55 FR 5775, Feb. 16, 1990]



PART 623--ENVIRONMENT, CONSERVATION, OCCUPATIONAL SAFETY, AND DRUG-FREE WORKPLACE--Table of Contents




        Subpart 623.1--Pollution Control and Clean Air and Water

Sec.
623.104  Exemptions.
623.107  Compliance responsibilities.

  Subpart 623.3--Hazardous Material Identification and Material Safety 
                                  Data

623.302-70  Policy.

                Subpart 623.4--Use of Recovered Materials

623.470  Affirmative procurement program for recovered materials.
623.471  Purpose.
623.472  Applicability.

[[Page 529]]

623.473  Definitions.
623.474  EPA guidelines.
623.475  Responsibilities.
623.476  Preference programs for guideline items.
623.476-1  Preference program for the purchase of cement and concrete 
          containing fly ash.
623.476-2  Preference program for building insulation products 
          containing recovered materials.
623.476-3  Preference program for lubricating oils containing recovered 
          materials.
623.476-4  Preference program for retread tires.
623.476-5  Preference program for paper and paper products containing 
          recovered materials.
623.477  Promotion program.
623.478  Evaluation and certification.
623.479  Annual review and monitoring.
623.480  Solicitation provisions and contract clauses.

                   Subpart 623.5--Drug-Free Workplace

623.506  Suspension of payments, termination of contract, and debarment 
          and suspension actions.

    Authority:  40 U.S.C. 486(c); 22 U.S.C. 2658.

    Source:  53 FR 26172, July 11, 1988, unless otherwise noted.



        Subpart 623.1--Pollution Control and Clean Air and Water



623.104  Exemptions.

    The Procurement Executive is the agency head for the purposes of FAR 
23.104(c).



623.107  Compliance responsibilities.

    The Procurement Executive is the agency head's designee for the 
purposes of FAR 23.107.



  Subpart 623.3--Hazardous Material Identification and Material Safety 
                                  Data



623.302-70  Policy.

    Any work which affects the safety and/or health of post personnel, 
including the handling of hazardous materials, shall comply with the 
applicable requirements of the Department of State Safety/Health and 
Environmental Management Resource Guide (6 FAM 606.7). Requirements 
offices shall ensure that any contractor operations and activities, 
whether sponsored by the post or other Department organization, are 
closely coordinated with the Post Occupational Safety and Health Officer 
during both planning and implementation phases.
[59 FR 66760, Dec. 28, 1994]



                Subpart 623.4--Use of Recovered Materials

    Source:  59 FR 66760, Dec. 28, 1994, unless otherwise noted.



623.470  Affirmative procurement program for recovered materials.



623.471  Purpose.

    This section establishes the Department of State's Affirmative 
Procurement Program for Recovered Materials in accordance with Section 
6002 of the Resource Conservation and Recovery Act (RCRA) (42 U.S.C. 
6962, Pub. L. 94-580). Section 6002 requires that each agency develop an 
affirmative procurement plan to assure that items composed of recovered 
materials will be purchased to the maximum extent practical and which is 
consistent with Federal procurement law. It requires that preference be 
given in procurement programs to the purchase of items containing 
recycled materials identified in guidelines promulgated by the 
Environmental Protection Agency (EPA). Executive Order 12780, Federal 
Agency Recycling and the Council on Federal Recycling and Procurement 
Policy, directed implementation of cost effective affirmative 
procurement programs for recycled items.



623.472  Applicability.

    The affirmative procurement program is applicable to all domestic 
acquisition of items currently designated by an EPA guideline or by 
future guidelines promulgated by EPA. The requirements of this section 
are not applicable to acquisitions made and/or performed outside the 
United States or its possessions.



623.473  Definitions.

    Affirmative procurement program is a program which ensures that 
items composed of recovered materials will be purchased to the maximum 
extent

[[Page 530]]

practicable, consistent with Federal procurement law. There are four 
components to an affirmative procurement program: (1) A preference 
program; (2) a promotion program; (3) procedures for requiring, 
obtaining and verifying estimates and certifications of recovered 
materials content; and, (4) an annual review and monitoring.
    Designated item is an item that has been designated in an EPA 
procurement guideline as an item that is or can be produced using 
recovered materials whose procurement will advance the purpose of RCRA.
    Minimum-content standard is the minimum content of recovered 
materials that a designated item must contain pursuant to specifications 
implementing the Department's preference program.
    Postconsumer recovered materials are waste materials recovered from 
retail stores, office buildings, homes, and so forth after they have 
passed through their end usage as a consumer item. Waste paper includes 
all items from the first two categories above in addition to forest 
residues, and manufacturing and other wastes.
    Procurement guidelines are guidelines issued by the EPA pursuant to 
Section 6002 of RCRA: (1) Identifying items that are or can be produced 
with recovered materials and where procurement will advance the 
objectives of the Act; and, (2) providing recommended practices for the 
procurement of such items.
    Recovered materials are waste materials and by-products that have 
been recovered or diverted from solid waste, not including those 
materials and by-products generated from, and commonly reused within, an 
original manufacturing process.
    Unreasonable price is the price for products containing recovered 
materials which exceeds alternatives made with virgin materials by 10 
percent or more, and which the requirements office initiating the 
acquisition substantiates as exorbitant.



623.474  EPA guidelines.

    (a) The EPA has published five guidelines that designate the 
following items that are or can be produced using recovered materials. 
Accordingly, contracting activities shall procure items produced using 
recovered materials to the maximum extent possible when procuring these 
designated items:
    (1) Cement and concrete containing fly ash, 40 CFR part 249;
    (2) Paper and paper products, 40 CFR part 250;
    (3) Lubricating oils, 40 CFR part 252;
    (4) Retread tires, 40 CFR part 253; and,
    (5) Building insulation products, 40 CFR part 248.
    (b) Copies of these guidelines, as well as future guidelines 
promulgated by EPA, may be obtained by calling EPA's Recycled Products 
Information Clearinghouse at (703) 941-4452.
    (c) These guidelines are applicable when the Department purchases 
more than $10,000 worth of a designated item, or if the cost of all such 
items purchased by the Department during the preceding Fiscal Year was 
$10,000 or more.



Sec. 623.475  Responsibilities.

    (a) The requirements office initiating an acquisition is responsible 
for determining whether recovered materials should be included in the 
specifications. Requirements offices may purchase items subject to the 
guidelines containing other than recovered materials only if:
    (1) The price of items with recovered materials is unreasonable;
    (2) The requirement for items produced with recovered materials 
results in inadequate competition or adversely affects small business or 
the Department's metrication program;
    (3) Obtaining items with recovered materials results in unusual and 
unreasonable delays; or
    (4) Items produced with recovered materials do not meet all 
reasonable performance specifications.
    (b) If the requirements office chooses to procure designated items 
that do not contain recovered materials, a written justification must be 
submitted to the contracting officer.

[[Page 531]]



623.476  Preference programs for guideline items.



623.476-1  Preference program for the purchase of cement and concrete containing fly ash.

    Domestic contracts requiring the purchase of cement and concrete 
shall specify the performance requirements of the products required 
under the contract using appropriate standards/specifications when 
available. Consistent with such performance specifications, such 
contracts shall allow the contractor to deliver cement and concrete 
products that contain fly ash, a component of coal resulting from its 
combustion in electrical generating plants. Architects/Engineers shall 
specify performance requirements for the concrete to be supplied.



623.476-2  Preference program for building insulation products containing recovered materials.

    Minimum content standards for building insulation products have been 
established by EPA guidelines. Domestic contracts for the design of 
structures that will utilize building insulation products shall require 
that the Architect/Engineer include, as a design consideration, the 
Department preference for the use of building insulation produced with 
recovered materials. Such contracts shall require that the Architect/
Engineer specify the type of building insulation products to be supplied 
and shall require the Architect/Engineer to justify, in writing, the 
basis of the selected product type if it is not in accordance with the 
EPA guideline.



623.476-3  Preference program for lubricating oils containing recovered materials.

    Contracts requiring the supply of lubricating oils, hydraulic fluids 
and gear oils shall require that products conform to the EPA guideline.



623.476-4  Preference program for retread tires.

    Contracts requiring replacement tires for automobiles, light and 
heavy trucks and trailers, and off-road tires shall specify that 
retreading services shall be obtained if the carcass is retreadable. If 
such retreading services are not practicable, replacement tires shall be 
procured in accordance with the EPA guideline.



623.476-5  Preference program for paper and paper products containing recovered materials.

    (a) All contracts requiring the purchase of paper and paper products 
shall require that paper and paper products delivered to the Department 
meet the EPA guideline for recycled paper.
    (b) Contracting officers shall require contractors to use recycled 
paper when submitting reports and other deliverables to the Department, 
when feasible.
    (c) Contracting officers shall require offerors/bidders to submit 
proposals/bids on recycled paper, double-sided copying to the maximum 
extent possible.



623.477  Promotion program.

    Items composed of recovered materials shall be purchased under all 
new domestic contracts to the maximum extent practicable. Contracting 
officers shall promote the fact that the Department is seeking to buy 
items containing recovered materials at pre-proposal and pre-bid 
conferences when appropriate.



623.478  Evaluation and certification.

    (a) Contracting officers shall ensure that vendors estimate in their 
offers/bids the percentage of recovered material of the total content of 
designated items to be used under the contract.
    (b) Contracting officers shall ensure that contractors certify the 
percentage of recovered materials contained in designated items actually 
supplied under the contract.



623.479  Annual review and monitoring.

    The effectiveness of the preference program shall be reviewed 
annually by A/OPE. An assessment will be made to determine if greater 
use of recovered material is possible for the existing requirements or 
if recovered materials are causing undue delay, lack of competition, 
unreasonable prices or an unacceptable level of performance.

[[Page 532]]



623.480  Solicitation provisions and contract clauses.

    (a) The contracting officer shall insert the provision at 652.223-
70, Estimates of the Total Percentage of Recovered Materials to be 
Utilized in the Performance of the Contract, in all domestic contracting 
activity solicitations using recovered materials in the performance of 
the work.
    (b) The contracting officer shall insert the clause at 652.223-71, 
Certification of Minimum Content Actually Utilized in the Performance of 
the Contract, in all domestic solicitations and contracts requiring the 
use of recovered materials.
    (c) The contracting officer shall insert the provision at 652.223-
72, Use of Double-Sided Copying in the Submission of Bids or Proposals, 
in all domestic solicitations for supplies or services.
    (d) The contracting officer shall insert the clause at 652.223-73, 
Use of Double-Sided Copying in the Submission of Reports, in all 
domestic solicitations and contracts for supplies or services.
    (e) The contracting officer shall insert the clause at 652.233-74, 
Use of Fly Ash as a Partial Replacement for Cement and Concrete, in all 
domestic solicitations and contracts for Architect/Engineer services for 
the design of structures or works that will use cement and concrete 
products, unless the requirements office provides a written 
justification for using virgin materials.
    (f) The contracting officer shall insert the clause at 652.223-75, 
Use of Recovered Materials in Building Insulation Products, in all 
domestic solicitations and contracts for Architect/Engineer services for 
the design of structures or works that will utilize or incorporate 
building insulation products containing recovered materials, unless the 
program office provides a written justification for using virgin 
materials.
    (g) The contracting officer shall insert the clause at 652.223-76, 
Use of Lubricating Oils Containing Re-Refined Oils, in all domestic 
solicitations and contracts that require the delivery of lubricating 
oils, unless the program office provides a written justification for 
using virgin materials.
    (h) The contracting officer shall insert the clause at 652.223-77, 
Use of Retread Tires, in all domestic solicitations and contracts that 
require the replacement of tires for automobiles, light and heavy trucks 
and trailers, and off-road vehicles, unless the program office provides 
a written justification for not using retread tires. This clause does 
not apply to the purchase of original equipment tires.
    (i) The contracting officer shall insert the clause at 652.233-78, 
Use of Recovered Materials in Paper and Paper Products, in all domestic 
solicitations and contracts that require the delivery of reports or 
other paper products, unless the program office provides a written 
justification for the use of virgin materials.



                   Subpart 623.5--Drug-Free Workplace



623.506  Suspension of payments, termination of contract, and debarment and suspension actions.

    The authority to approve the determination prescribed in FAR 
23.506(e) is reserved to the Secretary of State.
[55 FR 5775, Feb. 16, 1990]



PART 624--PROTECTION OF PRIVACY AND FREEDOM OF INFORMATION--Table of Contents




    Authority:  22 U.S.C. 2658; 40 U.S.C. 486(c); 48 CFR Subpart 1.3.



                Subpart 624.2--Freedom of Information Act



624.202  Policy.

    DOS regulations implementing the Freedom of Information Act (5 
U.S.C. 552), as amended, are codified in Chapter 1, Department of State, 
Subchapter R, Access to Information, Part 171, Availability of 
information and records to the public, of Title 22 of the Code of 
Federal Regulations (22 CFR Part 171).
[53 FR 26172, July 11, 1988]

[[Page 533]]



PART 625--FOREIGN ACQUISITION--Table of Contents




                Subpart 625.1--Buy American Act--Supplies

Sec.
625.102  Policy.
625.105  Evaluating offers.
625.108  Excepted articles, materials, and supplies.

         Subpart 625.2--Buy American Act--Construction Materials

625.202  Policy.
625.203  Evaluating offers.
625.204  Violations.

               Subpart 625.3--Balance of Payments Program

625.300  Scope of subpart.
625.300-70  Overseas acquisitions.
625.302  Policy.
625.304  Excess and near-excess foreign currencies.

        Subpart 625.7--Restrictions on Certain Foreign Purchases

625.703  Exceptions.

          Subpart 625.9--Additional Foreign Acquisition Clauses

625.901  Omission of examination of records clause.
625.903  Conditions for omission.

    Authority:  40 U.S.C. 486(c); 22 U.S.C. 2658.

    Source:  53 FR 26172, July 11, 1988, unless otherwise noted.



                Subpart 625.1--Buy American Act--Supplies



625.102  Policy.

    (a)(3) The authority to make the determination prescribed in FAR 
25.102(a)(3) is delegated, without power of redelegation, to the head of 
the contracting activity.
    (b)(2) The authority to make the determination prescribed in FAR 
25.102(b)(2) is delegated, without power of redelegation, to the head of 
the contracting activity.
[59 FR 66762, Dec. 28, 1994]



625.105  Evaluating offers.

    The authority to make the determinations prescribed in FAR 25.105 is 
delegated, without power of redelegation, to the head of the contracting 
activity.



625.108  Excepted articles, materials, and supplies.

    A/OPE is the DOS central agency control point for furnishing to the 
appropriate FAR Council the documentation prescribed in FAR 15.108(b) 
and (c).
[53 FR 26172, July 11, 1988, as amended at 59 FR 66762, Dec. 28, 1994]



         Subpart 625.2--Buy American Act--Construction Materials



625.202  Policy.

    (a)(2) The authority to make the determination prescribed in FAR 
25.202(a)(2) is delegated, without power of redelegation, to the head of 
the contracting activity.
    (b) The authority to make the determination prescribed in FAR 
25.202(b) is delegated, without power of redelegation, to the head of 
the contracting activity.
[59 FR 66762, Dec. 28, 1994]



625.203  Evaluating offers.

    The head of the contracting activity is the agency head for the 
purposes of FAR 25.203 (a) and (b).
[59 FR 66762, Dec. 28, 1994]



625.204  Violations.

    The Procurement Executive is the agency head for the purposes of FAR 
25.204.



               Subpart 625.3--Balance of Payments Program



625.300  Scope of subpart.



625.300-70  Overseas acquisitions.

    This program applies to acquisitions of supplies and services for 
use outside the United States regardless of the contractor's location.



625.302  Policy.

    The authority to make the determination prescribed in FAR 
25.302(b)(3) is delegated, without power of redelegation, to the head of 
the contracting activity. The authority prescribed in FAR 25.302(c) is 
delegated, without

[[Page 534]]

power of redelegation, to the head of the contracting activity.



625.304  Excess and near-excess foreign currencies.

    The authority to make the determination prescribed in FAR 25.304(c) 
is delegated to the head of the contracting activity without power of 
redelegation.
[53 FR 26172, July 11, 1988, as amended at 59 FR 66762, Dec. 28, 1994]



        Subpart 625.7--Restrictions on Certain Foreign Purchases



625.703  Exceptions.

    The authority to approve exceptions for other contracts in excess of 
the simplified acquisition threshold is delegated, without power of 
redelegation, o the head of the contracting activity.
[60 FR 39663, Aug. 3, 1995]



          Subpart 625.9--Additional Foreign Acquisition Clauses



625.901  Omission of examination of records clause.

    (a) The Procurement Executive is the agency head for the purposes of 
FAR 25.901.
    (b) Each determination and findings to omit FAR clause 52.215-1, 
Examination of Records by Comptroller General, shall be prepared in 
writing by the contracting officer and submitted to the Procurement 
Executive for approval.
    (c) The Procurement Executive shall forward the approved 
determination and findings to the requesting contracting activity for 
inclusion in the contract file, or inform the contracting activity in 
writing if the determination and findings is not approved, as 
appropriate.
    (1)(ii) The report required by FAR 25.901(c)(1)(ii) shall be 
prepared and forwarded to the Assistant Secretary of State for 
Administration by the Procurement Executive.
[59 FR 66762, Dec. 28, 1994]



625.903  Conditions for omission.

    The Procurement Executive is the agency head for the purposes of FAR 
25.903.

[[Page 535]]



             SUBCHAPTER E--GENERAL CONTRACTING REQUIREMENTS





PART 627--PATENTS, DATA, AND COPYRIGHTS--Table of Contents




                         Subpart 627.2--Patents

Sec.
627.203  Patent indemnification of Government by contractor.
627.203-6  Clause for Government waiver of indemnity.

         Subpart 627.3--Patent Rights Under Government Contracts

627.303  Contract clauses.
627.304  Procedures.
627.304-1  General.
627.304-5  Appeals.

    Authority:  40 U.S.C. 486(c); 22 U.S.C. 2658.

    Source:  59 FR 66763, Dec. 28, 1994, unless otherwise noted.



                         Subpart 627.2--Patents



627.203  Patent indemnification of Government by contractor.



627.203-6  Clause for Government waiver of indemnity.

    The Procurement Executive is the agency head's designee for the 
purposes of FAR 27.203-6.



         Subpart 627.3--Patent Rights Under Government Contracts



627.303  Contract clauses.

    The Procurement Executive is the agency head's designee for the 
purposes of FAR 27.303. Determinations issued by the Procurement 
Executive shall be reviewed by the Office of the Legal Adviser.



627.304  Procedures.



627.304-1  General.

    The Procurement Executive is the agency head's designee for the 
purposes of FAR 27.304-1. Questions regarding fact-finding procedures as 
specified in FAR 27.304-1(a)(4) shall be referred to A/OPE. 
Determinations issued by the Procurement Executive shall be reviewed by 
the Office of the Legal Adviser.



627.304-5  Appeals.

    The Procurement Executive is the agency head's designee for the 
purposes of FAR 27.304-5. Questions regarding the appeals procedure as 
specified in FAR 27.304-5(b) shall be referred to A/OPE.



PART 628--BONDS AND INSURANCE--Table of Contents




                          Subpart 628.1--Bonds

Sec.
628.101  Bid guarantees.
628.101-1  Policy on use.
628.106-6  Furnishing information.

                         Subpart 628.2--Sureties

628.203  Acceptability of individual surety.
628.203-7  Exclusion of individual sureties.

                        Subpart 628.3--Insurance

628.305  Overseas workers' compensation and war-hazard insurance.
628.306  Insurance under fixed-price contracts.
628.307  Insurance under cost-reimbursement contracts.
628.307-70  Insurance under labor-hour and time-and-materials contracts.

                     Subpart 628-70--Indemnification

628.7001  DOSAR contract clause.

    Authority:  40 U.S.C. 486(c); 22 U.S.C. 2658.

    Source:  53 FR 26173, July 11, 1988, unless otherwise noted.



                          Subpart 628.1--Bonds

    Source:  59 FR 66763, Dec. 28, 1994, unless otherwise noted.



628.101  Bid guarantees.



628.101-1  Policy on use.

    (c) The Procurement Executive is the agency head's designee for the 
purposes of FAR 28.101-1(c).



628.106-6  Furnishing information.

    (c) The head of the contracting activity is the agency head's 
designee for the purposes of FAR 28.106-6(c).

[[Page 536]]



                         Subpart 628.2--Sureties



628.203  Acceptability of individual surety.

    (g) Evidence of possible criminal or fraudulent activities by an 
individual surety shall be referred to the Office of the Inspector 
General.
[59 FR 66763, Dec. 28, 1994]



628.203-7  Exclusion of individual sureties.

    The Procurement Executive is the agency head's designee for the 
purposes of FAR 28.203-7.
[59 FR 66763, Dec. 28, 1994]



                        Subpart 628.3--Insurance

    Source:  59 FR 66763, Dec. 28, 1994, unless otherwise noted.



628.305  Overseas workers' compensation and war-hazard insurance.

    (a) It is the Department's policy that acquisitions for services, 
including construction but excluding personal services contracts, which 
require contractor personnel to perform work outside of the United 
States, shall include the contractual obligation for coverage under the 
Defense Base Act (42 U.S.C. Sections 1651-1654, as amended). For the 
purpose of this section only, ``contractor personnel'' includes 
individuals who are either:
    (1) United States citizens or residents, or
    (2) Hired in the United States or its possessions.
    (b) The Department of State has entered into a contract with an 
insurance broker and carrier to provide Defense Base Act insurance, at a 
fixed rate for services and construction, to cover DOS contracts which 
will require performance overseas by United States citizens, residents, 
or those employed in the United States. In countries where local 
nationals and/or third country nationals will be employed to perform the 
contract, such countries may be waived by the Secretary of Labor. 
Whenever such insurance is required under the contract, the contracting 
officer shall insert:
    (1) The clause at 652.228-71, Worker's Compensation Insurance 
(Defense Base Act)--Services;
    (2) The clause at 652.228-72, Worker's Compensation Insurance 
(Defense Base Act)--Construction; and,
    (3) The clause at 652.228-73, Waiver of Defense Base Act.
    (c) Upon award of a contract which requires Defense Base Act 
insurance, the contracting officer shall notify the successful offeror 
of the name of the insurance broker from which the contractor should 
acquire insurance.
    (d) The authority to request a waiver from the Secretary of Labor of 
a particular country, as set forth in FAR 28.305(d), is reserved to the 
Secretary of State. The Department has obtained blanket waivers from the 
Secretary of Labor for all contracts for services, including 
construction, awarded and/or performed overseas. The waivers apply to 
all individuals who are not employees hired in the United States, or who 
are not United States citizens or residents.



628.306  Insurance under fixed-price contracts.

    (a) The contracting officer shall insert the provision at:
    (1) 652.228-74, Defense Base Act Insurance Rates--Limitation--
Services, in solicitations for fixed-price service contracts to be 
performed outside the United States by United States citizens or 
residents and/or those hired in the United States; or
    (2) 652.228-75, Defense Base Act Insurance Rates--Limitation--
Construction, in solicitations for fixed-price construction contracts to 
be performed outside the United States by United States citizens or 
residents and/or those hired in the United States.



628.307  Insurance under cost-reimbursement contracts.

    The contracting officer shall insert the provision at 652.228-76, 
Defense Base Act Insurance Rates--Limitation--Cost-Reimbursement, in 
solicitations for cost-reimbursement type contracts to be performed 
outside the United States by United States citizens or residents and/or 
those hired in the United States.

[[Page 537]]



628.307-70  Insurance under labor-hour and time-and-materials contracts.

    The contracting officer shall insert the provision at 652.228-77, 
Defense Base Act Insurance Rates--Limitation--Labor-Hour and Time-and-
Material, in solicitations for labor-hour or time-and-material type 
contracts to be performed outside the United States by United States 
citizens or residents and/or those hired in the United States.



                     Subpart 628-70--Indemnification



628.7001  DOSAR contract clause.

    (a) Contractors should not ordinarily be required to assume risks 
which a private buyer would guard against through insurance. There may 
be occasions, however, when a contractor's assumption of such risks is 
in the best interest of the Government. The clause in paragraph (b) 
below is authorized for use on those occasions. In the determination of 
its use, the contracting officer should weigh the advantages it provides 
against the likelihood of a resultant increase in the contract price.
    (b) The contracting officer shall insert the clause at 652.228-70, 
Indemnification, in solicitations and contracts when it is determined 
that the contractor's assumption of risk is in the best interest of the 
Government.



PART 629--TAXES--Table of Contents




                         Subpart 629.1--General

Sec.
629.101  Resolving tax problems.

                   Subpart 629.2--Federal Excise Taxes

629.202  General exemptions.
629.202-70  Exemption from other Federal taxes.

                  Subpart 629.3--State and Local Taxes

629.302  Application of State and local taxes to the Government.
629.303  Application of State and local taxes to Government contractors 
          and subcontractors.

                     Subpart 629.4--Contract Clauses

629.401  Domestic contracts.
629.401-70  DOSAR contract clause.

    Authority:  22 U.S.C. 2658; 40 U.S.C. 486(c); 48 CFR Subpart 1.3.

    Source:  53 FR 26173, July 11, 1988, unless otherwise noted.



                         Subpart 629.1--General



629.101  Resolving tax problems.

    In certain instances, acquisitions by posts are exempt from various 
taxes in foreign countries. Contracting officers shall ascertain such 
exemptions and take maximum advantage of them.



                   Subpart 629.2--Federal Excise Taxes



629.202  General exemptions.



629.202-70  Exemptions from other Federal taxes.

    Taxable articles purchased for presentation abroad as gifts to 
foreign dignitaries and taxable articles purchased for presentation as 
gifts to foreign dignitaries visiting in the United States but which are 
to be taken out of the United States may be exempt from retail taxes or 
manufacturers excise taxes, in accordance with the letter of October 18, 
1963, from the Chief, Excise Tax Branch, Internal Revenue Service.



                  Subpart 629.3--State and Local Taxes



629.302  Application of State and local taxes to the Government.

    The Office of the Legal Adviser is the agency-designated counsel for 
the purposes of FAR 29.302(a).



629.303  Application of State and local taxes to Government contractors and subcontractors.

    The authority to make the determination prescribed in FAR 29.303(a) 
is delegated, without power of redelegation, to the head of the 
contracting activity (see 601.603-70). The Office of the Legal Adviser 
is the agency-designated counsel for the purposes of FAR 29.303(c).

[[Page 538]]



                     Subpart 629.4--Contract Clauses



629.401  Domestic contracts.



629.401-70  DOSAR contract clause.

    The contracting officer shall insert the clause at 652.229-71, 
Excise Tax Exemption Statement for Contractors Within the United States, 
in solicitations and contracts if the prospective contractor is located 
inside the United States and the acquisition involves export of supplies 
to an overseas post.



PART 630--COST ACCOUNTING STANDARDS--Table of Contents




    Authority:  22 U.S.C. 2658; 40 U.S.C. 486(c); 48 CFR Subpart 1.3.



                 Subpart 630.3--CAS Program Requirements



630.201-5  Waiver.

    The Procurement Executive is the agency head's designee for the 
purposes of FAR 30.201-5(c).
[53 FR 26173, July 11, 1988]



PART 631--CONTRACT COST PRINCIPLES AND PROCEDURES--Table of Contents




    Authority:  40 U.S.C. 486(c); 22 U.S.C. 2658.



                      Subpart 631.1--Applicability



631.101  Objectives.

    The Procurement Executive is the agency head's designee for the 
purposes of FAR 31.101.
[59 FR 66764, Dec. 28, 1994]



PART 632--CONTRACT FINANCING--Table of Contents




                     Subpart 632.4--Advance Payments

Sec.
632.402  General.
632.407  Interest.

                     Subpart 632.7--Contract Funding

632.703  Contract funding requirements.
632.703-3  Contracts crossing fiscal years.

                   Subpart 632.8--Assignment of Claims

632.803  Policies.

                      Subpart 632.9--Prompt Payment

632.903  Policy.
632.908  Contract clauses.

    Authority:  40 U.S.C. 486(c); 22 U.S.C. 2658.

    Source:  53 FR 26173, July 11, 1988, unless otherwise noted.



                     Subpart 632.4--Advance Payments



632.402  General.

    (b) Advance payments shall be authorized sparingly. Contracting 
officers should consider the use of partial payments, fast payments, or 
more frequent payments as alternatives to advance payments.
    (c)(1)(iii) The authority to make the determination prescribed in 
FAR 32.402(c)(1)(iii) is delegated, without power of redelegation, to 
the head of the contracting activity (see 601.603-70). For acquisitions 
by overseas posts, the head of the contracting activity shall obtain the 
concurrence of the Procurement Executive before making a determination 
pursuant to this section.
[53 FR 26173, July 11, 1988, as amended at 59 FR 66764, Dec. 28, 1994]



632.407  Interest.

    (d) The Procurement Executive is the agency head's designee for the 
purposes of FAR 32.407(d).
[59 FR 66764, Dec. 28, 1994]



                     Subpart 632.7--Contract Funding



632.703  Contract funding requirements.



632.703-3  Contracts crossing fiscal years.

    (a) The State Department Basic Authorities Act of 1956, as amended 
(22 U.S.C. 2696(e)), allows funds from annual appropriations to extend 
beyond the fiscal year in which the acquisition was funded. This 
authority may be used for acquisitions of supplies or services, 
regardless of dollar amount or contract type. Use of this authority 
requires that:
    (1) The acquisition normally would be considered severable (i.e., 
the services are repetitive and can be started

[[Page 539]]

or stopped any time; would normally be funded and performed within a 
fiscal year; and are not services integral to the creation of an end 
product. An example is janitorial services);
    (2) The base performance period is twelve months, begins in the 
current fiscal year, and crosses into the next fiscal year; and,
    (3) Full funding for twelve months is available in the current year.
    (b) If the acquisition involves more than one source of funds, the 
contract shall be priced to identify the source of funds (by allotment) 
with the relevant portion of the total supplies or services. For current 
Department contracts, bilateral modifications are authorized where 
necessary to convert to a performance period that crosses fiscal years, 
as long as the requisite funding is available as described in paragraph 
(a), and provided that the total contract length does not increase.
    (c) Use of this authority shall be documented in the contract file 
and be included as part of the Advance Acquisition Plan and Price 
Negotiation Memorandum. If neither document is relevant to the 
acquisition, the contracting officer shall prepare a written document to 
the file indicating compliance with this subsection.
    (d) For acquisitions conducted by overseas posts that are funded by 
another agency, the contracting officer shall ensure that funding for 
the full twelve-month period is available at time of award if the 
authority in 22 U.S.C. 2696(e) will be used.
[59 FR 66764, Dec. 28, 1994]



                   Subpart 632.8--Assignment of Claims



632.803  Policies.

    (b) The assignment of claims shall be prohibited for all personal 
services contracts. The assignment of claims shall also be prohibited 
for all contracts awarded and performed overseas, unless approval is 
received from the Procurement Executive.
[59 FR 66764, Dec. 28, 1994]



                      Subpart 632.9--Prompt Payment



632.903  Policy.

    The authority to make the determination prescribed in FAR 32.903 is 
delegated, without power of redelegation, to the head of the contracting 
activity. Before making a determination concerning early invoice and 
contract financing payments, the head of the contracting activity shall 
consult with the Office of Fiscal Operations director, or designee.
[55 FR 5775, Feb. 16, 1990]



632.908  Contract clauses.

    (a) The contracting officer may insert a clause substantially the 
same as the clause at 652.232-70, Payment Schedule and Invoice 
Submission (Fixed-Price), in fixed-price type solicitations and 
contracts.
    (b) The contracting officer may insert a clause substantially the 
same as the clause at 652.232-71, Voucher Submission (cost-
Reimbursement), in cost-reimbursement type solicitations and contracts.
[59 FR 66764, Dec. 28, 1994]



PART 633--PROTESTS, DISPUTES, AND APPEALS--Table of Contents




                         Subpart 633.1--Protests

Sec.
633.102  General.
633.103  Protests to the agency.
633.104  Protests to GAO.
633.105  Protests to GSBCA.

                   Subpart 633.2--Disputes and Appeals

633.203  Applicability.
633.211  Contracting officer's decision.
633.214-70  Alternative dispute resolution.
633.270  Disputes and appeals under DOS contracts subject to the 
          Contract Disputes Act of 1978.
633.270-1  Scope of section.
633.270-2  Designation.
633.270-3  DOS support.

    Authority:  40 U.S.C. 486(c); 22 U.S.C. 2658.

    Source:  53 FR 26173, July 11, 1988, unless otherwise noted.

[[Page 540]]



                         Subpart 633.1--Protests



633.102  General.

    All communications relative to protests filed with the General 
Accounting Office (GAO) or the General Services Administration Board of 
Contract Appeals (GSBCA) shall be coordinated with the Office of the 
Legal Adviser.



633.103  Protests to the agency.

    For protests filed with the Department and received before award, 
the contracting office shall obtain the advice of the Office of the 
Legal Adviser before making the determination prescribed in FAR 
33.103(a).



633.104  Protests to GAO.

    (a) General. (1) Upon being telephonically advised by the GAO of the 
receipt of a protest, before or after award, the Office of the Legal 
Adviser shall inform the appropriate head of the contracting activity, 
who shall immediately notify the contracting officer. For protests 
concerning ADP acquisitions, the Office of the Legal Adviser shall also 
inform the Deputy Assistant Secretary for Information Management. After 
receiving a copy of the protest from GAO and its request for an 
administrative report, the Office of the Legal Adviser shall promptly 
provide the same to the head of the contracting activity involved, who 
shall promptly provide a copy to the contracting officer and request a 
written report in conformance with FAR 33.104(a)(2).
    (2) In addition to the requirements in FAR 33.104(a)(2), the report 
responsive to the protest shall be appropriately titled and dated, shall 
cite the GAO file number, and shall be prepared and signed by the 
contracting officer. The contracting officer shall prepare the report 
with the assistance of the Office of the Legal Adviser. If appropriate, 
the report shall contain a statement regarding any urgency for the 
acquisition and the extent to which a delay in award may result in 
significant performance difficulties or additional expense to the 
Government. If award is not urgent, the report shall include an estimate 
of the length of time an award may be delayed without significant 
expense or difficulty in performance. The head of the contracting 
activity shall submit to the Office of the Legal Adviser an original and 
two complete copies of the contracting officer's report. The contracting 
officer shall provide one complete copy to each interested party who 
responded to GAO, to the contracting officer, or to the Office of the 
Legal Adviser pursuant to the notification prescribed in paragraph 
(a)(3) below. In submitting the report to GAO, the Office of the Legal 
Adviser shall identify all parties to whom the report has been 
furnished.
    (3) As prescribed in FAR 33.104(a)(3) and 4 CFR 21.3, the 
contracting officer shall promptly notify all interested parties, 
including offerors (or the contractor if the protest is after award) 
involved in or affected by the protest, that a protest has been filed 
with the GAO and the basis for the protest. The contracting officer 
shall place a written record of such notifications in the contract file. 
The contracting officer shall promptly transmit by letter a copy of the 
protest to all interested parties previously notified and include a 
statement requiring furnishing of views and information directly to the 
GAO. The contracting officer shall send copies of such cover letters 
concurrently to the Office of the Legal Adviser. Cover letters shall 
contain a specified period of time for submission of comments, in 
accordance with FAR 33.104(a)(3), and include instructions that any 
comments submitted to the GAO should also be submitted simultaneously to 
the contracting officer and the Office of the Legal Adviser. Materials 
submitted by the protester may be withheld from interested parties in 
accordance with 4 CFR 21.3(b).
    (4) All DOS personnel shall handle protests on a priority basis. If 
the specific circumstances of the protest require a longer period than 
allowed under FAR 33.104(a)(3), the head of the contracting activity 
shall immediately notify the Office of the Legal Adviser, which shall 
prepare a written request for extension of the period in accordance with 
4 CFR 21.3(d). The head of the contracting activity shall deliver the 
protest report to the Office of the Legal Adviser within 15 work days 
from the date of telephonic notification by the Office of the Legal 
Adviser.

[[Page 541]]

For reports involving use of the 10 work day express option provided at 
FAR 33.104(a)(4), the Office of the Legal Adviser shall establish the 
report delivery date after consultation with the head of the contracting 
activity.
    (b) Protests before award. If a protest before award has been filed 
with GAO and the contracting officer determines in writing that it is 
necessary to make award under the circumstances prescribed in FAR 
33.104(b)(1), the contracting officer shall first obtain advice from the 
Office of the legal Adviser. The contracting officer shall submit the 
written determination to the head of the contracting activity for 
approval.
    (f) Notice to GAO. The authority to submit the report prescribed in 
FAR 33.104(f) is delegated, without power of redelegation, to the head 
of the contracting activity. The report shall be submitted to the 
Comptroller General through the Office of the Legal Adviser.
[53 FR 26173, July 11, 1988, as amended at 59 FR 66764, Dec. 28, 1994]



633.105  Protests to GSBCA.

    (a) Upon receipt of a copy of a protest to GSBCA, the contracting 
officer or the official designated in the solicitation shall immediately 
notify the Office of the Legal Adviser and the Deputy Assistant 
Secretary for Information Management. The contracting officer is 
responsible for compliance with the requirements in FAR 33.105(a)(2). 
The contracting officer shall include in the contract file a record of 
such notifications to all parties and related correspondence with GSBCA. 
The contracting officer shall provide to the Office of the Legal Adviser 
a copy of the list of interested parties notified, simultaneously with 
submission of the list to the GSBCA.
    (b) The contracting officer shall submit to the Office of the Legal 
Adviser an original and two copies of the protest file, documented in 
conformance with FAR 33.105(b), within 8 work days after the filing of a 
protest. The contracting officer also shall provide a complete copy of 
the file to the protester and all other interested parties within 10 
work days after filing of the protest. The protest file shall be 
organized to comply with the requirements of Rule 4(b) of the GSBCA 
Rules of Procedure (48 CFR Ch. 61). The Office of the Legal Adviser 
shall then submit the file to the GSBCA within 10 work days after filing 
of the protest.
    (c) The Office of the Legal Adviser shall represent the contracting 
officer at any hearing on suspension of the agency's delegation of 
procurement authority or at any hearing on the merits of the protest. 
The Office of the Legal Adviser shall notify the contracting officer and 
the Deputy Assistant Secretary for Information Management of the results 
of any hearing.
    (d) The authority to execute the determination and findings (D&F) 
prescribed in FAR 33.105(d)(2) is delegated, without power of 
redelegation, to the head of the contracting activity.
[53 FR 26173, July 11, 1988, as amended at 59 FR 66764, Dec. 28, 1994]



                   Subpart 633.2--Disputes and Appeals



633.203  Applicability.

    The Procurement Executive is the agency head for the purposes of FAR 
33.203(b).



633.211  Contracting officer's decision.

    (a) In the second sentence of FAR 33.211(a)(4)(v), contracting 
officers shall replace ``the Board of Contract Appeals'' with ``Armed 
Services Board of Contract Appeals, Skyline 6, 5109 Leesburg Pike, Falls 
Church, VA 22041.''
    (b) Prior to issuing a contracting officer's final decision, the 
contracting officer shall obtain assistance, as appropriate, from the 
Office of the Legal Adviser.



633.214-70  Alternative dispute resolution.

    (a) Policy. The Department's goal is to resolve contract disputes 
before the issuance of a contracting officer's final decision under the 
Contract Disputes Act. Contracting officers shall consider all possible 
means of reaching a negotiated settlement, consistent with the 
Government's best interests, before issuing a final decision on a 
contractor claim under the process outlined in FAR 33.206 through 
33.211.

[[Page 542]]

    (b) When to use ADR. (1) Factors favoring ADR. Contracting officers 
should consider using ADR in those cases where:
    (i) Only facts are in dispute;
    (ii) The facts are clearly not favorable to the Government;
    (iii) The anticipated costs (in time and money) are less than the 
anticipated costs of litigation;
    (iv) Settlement attempts have reached an impasse;
    (v) ADR techniques have been used successfully in similar 
situations;
    (vi) There is a need for independent expert analysis; or,
    (vii) The claim has merit but its value is overstated.
    (2) Factors disfavoring ADR. The following circumstances do not 
favor use of ADR:
    (i) Cases involving disputes controlled by clear legal precedent, 
making compromise difficult;
    (ii) The resolution will have a significant impact on other pending 
cases or on the future conduct of Department business;
    (iii) The dispute is primarily over issues of law;
    (iv) A decision of precedential value is needed;
    (v) A significant policy question is involved;
    (vi) A full public record of the proceeding is important;
    (vii) The outcome could significantly involve persons who are not 
parties to the contract;
    (viii) The costs of pursuing an ADR procedure (in time and money) 
exceed the cost of litigation;
    (ix) The nature of the case may cause ADR to be used merely for 
delay or discovery; or,
    (x) The case involves criminal violations.
    (3) Initial action. Immediately upon receipt of a claim, the 
contracting officer shall send a letter acknowledging receipt of the 
claim and soliciting the contractor's views on submitting this claim for 
ADR. In every dispute, the first step toward resolution shall be 
unassisted negotiations, in which the parties try to work out the 
disagreement among themselves. If this fails, before issuing a final 
decision, the contracting officer shall consult first with the head of 
the contracting activity, and contact the Office of the Legal Adviser 
and A/OPE to determine whether the disagreement appears susceptible to 
resolution by ADR. Consideration shall be given to pursuing additional 
fact-finding or designating a neutral expert in the disputed issue to 
provide an advisory opinion.
    (c) Methods of ADR. If the initial action to resolve the dispute 
fails, and the contracting officer issues a final decision which is 
appealed, ADR may still be feasible. The ASBCA issues a notice regarding 
ADR to all contractors who file appeals under the Contract Disputes Act. 
This notice describes the following ADR techniques, which contracting 
officers are urged to discuss with contractors at any time:
    (1) Settlement judge. A settlement judge is either an administrative 
judge or hearing examiner who is appointed by the parties in dispute for 
the purpose of facilitating settlement. The agenda is flexible and based 
on the specifics of the individual dispute. By holding a frank, in-depth 
discussion of the strengths and weaknesses of each party's position, the 
settlement judge may be able to foster a settlement of the dispute. The 
settlement judge may meet with the parties jointly or individually, and 
the settlement judge's recommendations are not binding. Typically, the 
settlement judge's opinions, based on his or her experience in handling 
prior disputes, will help the parties realize whether their arguments 
have merit or not.
    (2) Minitrial. A minitrial is not an actual trial but rather a 
flexible, expedited, but structured procedure in which each party 
presents an abbreviated version of its position both to a neutral 
advisor (who may be appointed by the ASBCA) and to principals of the 
parties who have full contractual authority to conclude a settlement. 
The parties mutually decide on the form of presentation without regard 
to traditional judicial proceedings or rules of evidence. An advance 
agreement by the parties specifies the procedure to be followed in 
making presentations, as well as the role of the neutral advisor. Upon 
conclusion of the presentations, settlement negotiations are conducted.

[[Page 543]]

The neutral advisor may assist the parties in negotiating settlement, 
including making non-binding recommendations.
    (3) Summary trial with binding decision. A summary trial with 
binding decision is a procedure in which the scheduling of an appeal is 
expedited and the parties try their appeal informally before an 
administrative judge or panel of judges. The length of the trial and the 
time for presentation and decision are tailored to the needs of the 
particular case. Trial procedures and rules applicable to appeals are 
modified or eliminated to expedite resolution of the appeal. The parties 
must agree, however, that all decisions, rulings, and orders by the 
judge(s) are final, conclusive, and not appealable, and may not be set 
aside, except for fraud. A summary ``bench'' decision is issued at the 
conclusion of the trial or a summary written decision will be issued 
within ten (10) days of either the trial's conclusion or receipt of a 
trial transcript.
    (4) Mediation. Mediation is a process in which a neutral and 
impartial third party assists the Government and the contractor in 
conflict to negotiate an acceptable settlement of contested issues. The 
mediator is jointly selected and is asked by the disputing parties to 
assist them to reach a voluntary agreement. The mediator has no 
decisionmaking authority and cannot impose a decision. Mediation 
assistance involves working with the parties to improve their 
communications, clarify or interpret data, identify key issues to be 
discussed, design an effective negotiation process, generate settlement 
options, or help to identify or formulate areas of agreement. Additional 
information is available in Army Corps of Engineers IWR Pamphlet 91-ADR-
P-3, Mediation, September 1991; and Administrative Conference of the 
U.S., Mediation: A Primer for Federal Agencies, available from A/OPE.
    (5) Arbitration. Non-binding arbitration is a process in which a 
dispute is jointly submitted by the Government and a contractor to an 
impartial and neutral person or panel who provides a written, non-
binding opinion used as a guide for negotiations toward a settlement. 
Although the Administrative Dispute Resolution Act of 1990 (Pub. L. 101-
552) allows agencies to use binding arbitration, the law provides that 
the agency head may vacate any arbitration award within 30 days after it 
is served on all parties. For this reason, non-binding arbitration is 
preferable. Additional information is available in Army Corps of 
Engineers IWR Pamphlet 91-ADR-P-2, Non-Binding Arbitration, September 
1990, available from A/OPE.
    (6) Partnering. Partnering involves an agreement in principle to 
share the risks involved in completing a project, and to establish and 
promote a partnership environment. Partnering itself is not a 
contractual agreement and it does not create any legally enforceable 
rights, but instead partnering seeks to create a new cooperative 
attitude in completing Government contracts. The three basic steps in 
partnering are:
    (i) Establish the new relationship through personal contact among 
the principals for the Government and the contractor before the work 
begins;
    (ii) Prepare a joint statement of goals establishing common 
objectives in specific detail for reaching the goals; and,
    (iii) Identify specific dispute prevention processes designed to 
head off problems, evaluate performance, and promote cooperation. 
Additional information is available in Army Corps of Engineers IWR 
Pamphlet 91-ADR-P-4, Partnering, December 1991, available from A/OPE.
    (d) ADR procedures. The ADR method shall be selected voluntarily by 
both the Government and the contractor. Both parties shall agree on the 
procedures to be followed, including the agenda and amount of time 
allowed for each party to present its case. The parties may choose not 
to have a written transcript or hearing on the record, as this might 
inhibit settlement. Also, the decision rendered, if any, should not be 
considered to establish any precedent for future litigation unless the 
parties agree otherwise. In cases where the parties agree to pay jointly 
for a third-party neutral advisor, it is recommended that the parties 
and the advisor agree on a fair and reasonable price. The Government 
would then issue a simplified acquisition (if the

[[Page 544]]

dollar amount does not exceed the simplified acquisition limitation) for 
50% of the agreed price, and the advisor would submit separate invoices 
(each for 50% of the price) to the Government and the contractor.
[59 FR 66764, Dec. 28, 1994]



633.270  Disputes and appeals under DOS contracts subject to the Contract Disputes Act of 1978.



633.270-1  Scope of section.

    This section concerns disputes relating to DOS contracts and the 
transfer of certain appellate and review functions from the Department 
of State to the Armed Services Board of Contract Appeals.



633.270-2  Designation.

    The Armed Services Board of Contract Appeals (ASBCA) is the 
authorized representative of the Secretary of State and the Procurement 
Executive for the purposes of hearing and resolving disputes relating to 
DOS contracts subject to the Contract Disputes Act of 1978. The ASBCA 
shall hear and determine appeals by contractors from contracting 
officers' final decisions on disputed issues relating to DOS contracts 
subject to the Contract Disputes Act of 1978.



633.270-3  DOS support.

    The Procurement Executive shall ensure the support of all DOS 
personnel in processing appeals before the ASBCA. The Procurement 
Executive is authorized to require such DOS officers and employees to 
cooperate for this purpose.

[[Page 545]]



             SUBCHAPTER F--SPECIAL CATEGORIES OF CONTRACTING





PART 634--MAJOR SYSTEM ACQUISITION--Table of Contents




Sec.
634.001  Definitions.
634.001-70  Supplemental definitions.
634.002  Policy.
634.003  Responsibilities.
634.005  General requirements.
634.005-6  Full production.

    Authority:  40 U.S.C. 486(c); 22 U.S.C. 2658.

    Source:  53 FR 26175, July 11, 1988, unless otherwise noted.



634.001  Definitions.

    Major system:
    (a) The definition of ``major system'' in OMB Circular No. A-109, 
Major System Acquisitions (A-109), provides no exclusions; however, FAR 
34.001 excludes from the definition of ``major system'' construction or 
other improvements to real property. Acquisition of capital project 
systems by the Office of Foreign Buildings, which would otherwise be 
subject to the requirements of A-109 are thus exempted from these 
requirements. Under separate authority, the DOS has other existing 
controls that provide the necessary review, approval, and monitoring 
procedures to manage capital project systems acquisitions by the Office 
of Foreign Buildings.
    (b) Pursuant to A-109 and paragraph (b) of the definition of ``major 
system'' prescribed in FAR 34.001, any DOS system shall be considered a 
major system if total acquisition costs with private industry are 
expected to equal or exceed $30,000,000.
    (c) The acquisition executive is the Under Secretary for Management 
for the purposes of paragraph (c) of the definition of ``major system'' 
prescribed in FAR 34.001. The acquisition executive is authorized to 
designate as a major system acquisition any DOS system not expected to 
meet or exceed the $30,000,000 threshold identified in paragraph (b) 
above; provided, that the determination shall be made in accordance with 
the requirements of A-109, FAR Part 34, and this part 634.
    (d) Classification as a major system acquisition is independent of 
the number of component DOS contracting activities involved in the 
process. A major system acquisition may occur entirely within the 
jurisdiction of a single contracting activity or it may involve more 
than one DOS contracting activity.
    (e) Each major system acquisition shall be in response to a need of 
one of the DOS major missions, which are identified in volume 1 of the 
Foreign Affairs Manual System.
[53 FR 26175, July 11, 1988, as amended at 59 FR 66766, Dec. 28, 1994]



634.001-70  Supplemental definitions.

    Section five of A-109 defines several terms in addition to those 
defined in FAR 34.001.
    Major Acquisition Program Office (A/IM/MAPO) is located within the 
Office of Information Management. It has managerial and operational 
responsibilities relative to all major information resource 
acquisitions.
[53 FR 26175, July 11, 1988; 53 FR 36462, Sept. 20, 1988, as amended at 
59 FR 66766, Dec. 28, 1994]



634.002  Policy.

    The objective of A-109 is to assure effectiveness and efficiency in 
acquiring major systems. Section six of A-109 provides general policy 
guidelines in addition to those prescribed in FAR 34.002.



634.003  Responsibilities.

    (a) The Procurement Executive is the agency head's designee for the 
purposes of FAR 34.003(a). Written procedures for acquiring Federal 
Information Processing (FIP) resources by A/IM/MAPO are contained in the 
``Source Selection Procedures Guide'', issued by that Office.
    (b) The Under Secretary for Management is the agency head for the 
purposes of FAR 34.003(c) and the acquisition executive for the purposes 
of A-109.
[53 FR 26175, July 11, 1988, as amended at 59 FR 66766, Dec. 28, 1994]

[[Page 546]]



634.005  General requirements.



634.005-6  Full production.

    The Deputy Secretary is the agency head for the purposes of FAR 
34.005-6.
[59 FR 66766, Dec. 28, 1994]



PART 636--CONSTRUCTION AND ARCHITECT-ENGINEER CONTRACTS--Table of Contents




                         Subpart 636.1--General

Sec.
636.101  Applicability.
636.101-70  Exception.

     Subpart 636.2--Special Aspects of Contracting for Construction

636.209  Construction contracts with architect-engineer firms.

               Subpart 636.6--Architect-Engineer Services

636.602  Selection of firms for architect-engineer contracts.
636.602-4  Selection authority.
636.602-5  Short selection processes for contracts not to exceed the 
          simplified acquisition threshold.

    Authority:  40 U.S.C. 486(c); 22 U.S.C. 2658.

    Source:  53 FR 26175, July 11, 1988, unless otherwise noted.



                         Subpart 636.1--General



636.101  Applicability.



636.101-70  Exception.

    Contracts for overseas construction, including capital improvements, 
alterations, and major repairs, may be excepted from the provisions of 
the FAR (48 CFR Ch. 1) under the authority of the Foreign Service 
Buildings Act, 1926, as amended, 22 U.S.C. 292 et seq., as further 
codified at section 474 of Title 40, Public Buildings, Property, and 
Works, of the U.S. Code.
[53 FR 26175, July 11, 1988, as amended at 59 FR 66766, Dec. 28, 1994]



     Subpart 636.2--Special Aspects of Contracting for Construction



636.209  Construction contracts with architect-engineer firms.

    The Procurement Executive is the head of the agency for the purposes 
of FAR 36.209.



               Subpart 636.6--Architect-Engineer Services



636.602  Selection of firms for architect-engineer contracts.



636.602-4  Selection authority.

    (a) The final selection decision shall be made as designated by the 
Deputy Assistant Secretary for Foreign Buildings Operations for 
acquisitions issued by that office; the Director, Moscow Embassy 
Buildings Control Office, for Moscow chancery building(s) only; and, the 
appropriate head of the contracting activity for all other actions.
[59 FR 66766, Dec. 28, 1994]



636.602-5  Short selection processes for contracts not to exceed the simplified acquisition threshold.

    The short selection process described in FAR 36.602-5 is authorized 
for use for contracts not expected to exceed the simplified acquisition 
threshold.
[59 FR 66766, Dec. 28, 1994, as amended at 60 FR 39663, Aug. 3, 1995]



PART 637--SERVICE CONTRACTING--Table of Contents




                Subpart 637.1--Service Contracts--General

Sec.
637.103  Contracting officer responsibility.
637.104  Personal services contracts.
637.104-70  DOS personal services contracts.
637.106  Funding and term of service contracts.
637.110  Solicitation provisions and contract clauses.

    Authority:  40 U.S.C. 486(c); 22 U.S.C. 2658.

    Source:  53 FR 26176, July 11, 1988, unless otherwise noted.



                Subpart 637.1--Service Contracts--General



637.103  Contracting officer responsibility.

    The Office of the Legal Adviser is the DOS legal counsel for the 
purposes of FAR 37.103(a)(2).



637.104  Personal services contracts.

    The Office of the Legal Adviser is the DOS legal counsel for the 
purposes of FAR 37.104(e).

[[Page 547]]



637.104-70  DOS personal services contracts.

    Pursuant to FAR 37.104(b), DOS statutory authorities for personal 
services contracts are--
    (a) For the Department, section 2(c) of the State Department Basic 
Authorities Act of 1956, as amended (22 U.S.C. 2669);
    (b) For the Bureau of Population, Refugees, and Migration, section 
5(a)(6) of the Migration and Refugee Assistance Act of 1962, as amended 
(22 U.S.C. 2605);
    (c) For the Bureau for International Narcotics and Law Enforcement 
Affairs, section 636(a)(3) of the Foreign Assistance Act of 1961, as 
amended (22 U.S.C. 2396);
    (d) For the Foreign Service Institute, section 704(a)(4) of the 
Foreign Service Act of 1980, as amended (22 U.S.C. 4024);
    (e) For the Office of Foreign Missions, section 208(d) of Title II--
Authorities Relating to the Regulation of Foreign Missions, of the State 
Department Basic Authorities Act of 1956, as amended (22 U.S.C. 4308);
    (f) For the Office of Foreign Buildings and the Moscow Embassy 
Control Office, section 5 of the Foreign Service Buildings Act, 1926, as 
amended (22 U.S.C. 296);
    (g) For the U.S. Mission to the United Nations, section 7 of the 
United Nations Participation Act of 1945, as amended (22 U.S.C. 287e); 
and
    (h) For the Bureau of International Organization Affairs, the 
separate State Department appropriations acts.
[53 FR 26176, July 11, 1988, as amended at 59 FR 66766, Dec. 28, 1994; 
60 FR 39663, Aug. 3, 1995]



637.106  Funding and term of service contracts.

    The Department's statutory authority for authorizing contracts for 
services funded by annual appropriations to be performed in two fiscal 
years, if the total amount for such contracts is obligated in the 
earlier fiscal year, is 22 U.S.C. 2696(e). See DOSAR 632.703-3.
[59 FR 66766, Dec. 28, 1994]



637.110  Solicitation provisions and contract clauses.

    (a) The contracting officer shall insert the clause at 652.237-70, 
Compensatory Time Off, in personal services contracts awarded in support 
of International Narcotics Control programs overseas, if the contracting 
officer determines its use appropriate.
    (b) The contracting officer shall insert the clause at 652.237-71, 
Identification/Building Pass, in all solicitations and contracts where 
contractor personnel require frequent and continuing access to 
Department of State facilities.
    (c) The contracting officer shall insert a clause substantially the 
same as the clause at 652.237-72, Observance of Legal Holidays and 
Administrative Leave, in all solicitations and contracts where 
contractor personnel will be working on-site in any Department of State 
facility.
[59 FR 66766, Dec. 28, 1994]



PART 639--ACQUISITION OF INFORMATION RESOURCES--Table of Contents




    Authority:  40 U.S.C. 486(c); 22 U.S.C. 2658.



639.001-70  Policy.

    (a) The Assistant Secretary of State for Administration is the 
Department's Designated Senior Official as defined in the Federal 
Information Resources Management Regulation (FIRMR) 201-39.201.
[59 FR 66766, Dec. 28, 1994]

[[Page 548]]



                    SUBCHAPTER G--CONTRACT MANAGEMENT





PART 642--CONTRACT ADMINISTRATION--Table of Contents




          Subpart 642.2--Assignment of Contract Administration

Sec.
642.270  Contracting Officer's Representative (COR).
642.271  DOSAR contract clause.

       Subpart 642.6--Corporate Administrative Contracting Officer

642.602  Assignment and location.

          Subpart 642.14--Traffic and Transportation Management

642.1406-2  Contract clause.
642.1406-2  -70  DOSAR contract clauses.

    Authority:  40 U.S.C. 486(c); 22 U.S.C. 2658.

    Source:  53 FR 26176, July 11, 1988, unless otherwise noted.



          Subpart 642.2--Assignment of Contract Administration



642.270  Contracting Officer's Representative (COR).

    (a) Scope. Contracting officers may designate technically qualified 
personnel as their authorized representatives to assist in the 
administration of contracts. This section is mandatory for domestic 
contracting activities and recommended for overseas contracting 
activities.
    (b) Policy. It is Department policy that only Department of State 
employees who have completed adequate training and have the necessary 
experience and judgment shall be appointed as CORs. This policy shall be 
reinforced by contracting officers and administered jointly by A/OPE and 
FSI. Required training shall be funded by the COR's office.
[59 FR 66766, Dec. 28, 1994]



642.271  DOSAR contract clause.

    The contracting officer shall insert a clause substantially the same 
as the clause at 652.242-70, Contracting Officer's Representative, in 
solicitations and contracts when appointment of a contracting officer's 
representative is anticipated.
[53 FR 26176, July 11, 1988, as amended at 59 FR 66766, Dec. 28, 1994]



       Subpart 642.6--Corporate Administration Contracting Officer



642.602  Assignment and location.

    The Procurement Executive is the agency head's designee for the 
purposes of FAR 42.602(a).



          Subpart 642.14--Traffic and Transportation Management



642.1406-2  Contract clause.



642.1406-2-70  DOSAR contract clauses.

    (a) The contracting officer shall insert the clause at 652.242-71, 
Notice of Shipment, in solicitations and contracts entered into and 
performed outside the United States, when overseas shipment of supplies 
is required.
    (b) The contracting officer shall insert the clause at 652.242-72, 
Shipping Instructions, in solicitations and contracts with a source in 
the United States and overseas shipment of supplies is required.



PART 643--CONTRACT MODIFICATIONS--Table of Contents




    Authority:  40 U.S.C. 486(c); 22 U.S.C. 2658.



                         Subpart 643.1--General



643.102  Policy.



643.102-70  Contract compliance and review.

    (a) When applicable, the contracting officer shall ensure the 
proposed contract modification complies with the competition 
requirements of FAR Part 6 and DOSAR Part 606.
    (b) Subpart 604.70 prescribes the review requirements for modifying 
contracts for supplies and services, including construction. The 
contracting officer shall submit such contract modifications to A/OPE 
when:

[[Page 549]]

    (i) The modification itself exceeds the thresholds established in 
604.7002(a);
    (ii) The modification will cause the contract to exceed the 
thresholds established in 604.7002(a); or,
    (iii) Any proposed change under the modification results in an 
increase or decrease exceeding the thresholds in 604.7002(a) in any of 
the individual cost elements of the existing contract.
[53 FR 26176, July 11, 1988, as amended at 59 FR 66767, Dec. 28, 1994]



PART 645--GOVERNMENT PROPERTY--Table of Contents




       Subpart 645.3--Providing Government Property to Contractors

Sec.
645.302  Providing facilities.
645.302-1  Policy.

  Subpart 645.6--Reporting, Redistribution, and Disposal of Contractor 
                                Inventory

645.608  Screening of contractor inventory.
645.608-6  Waiver of screening requirements.
645.610  Sale of surplus contractor inventory.
645.610-2  Exemptions from sale by GSA.

    Authority:  22 U.S.C. 2658; 40 U.S.C. 486(c); 48 CFR Subpart 1.3.

    Source:  53 FR 26177, July 11, 1988, unless otherwise noted.



       Subpart 645.3--Providing Government Property to Contractors



645.302  Providing facilities.



645.302-1  Policy.

    The authority to make the determination prescribed in FAR 45.302-
1(a)(4) is delegated, without power of redelegation, to the head of the 
contracting activity (see 601.603-70).



  Subpart 645.6--Reporting, Redistribution, and Disposal of Contractor 
                                Inventory



645.608  Screening of contractor inventory.



645.608-6  Waiver of screening requirements.

    The Procurement Executive is the agency head's designee for the 
purposes of FAR 45.608-6.



645.610  Sale of surplus contractor inventory.



645.610-2  Exemptions from sale by GSA.

    The Procurement Executive is the agency head for the purposes of FAR 
45.610-2(a).



PART 646--QUALITY ASSURANCE--Table of Contents




    Authority:  22 U.S.C. 2658; 40 U.S.C. 486(c); 48 CFR Subpart 1.3.



                        Subpart 646.7--Warranties



646.710  Contract clauses.



646.710-70  DOSAR contract clause.

    The contracting officer shall insert the clause at 652.246-70, 
Commercial Warranty, in solicitations and contracts for commercial 
supplies or services awarded and performed outside the United States.
[53 FR 26177, July 11, 1988]



PART 647--TRANSPORTATION--Table of Contents




    Authority:  40 U.S.C. 486(c); 22 U.S.C. 2658.



647.000  Scope of part.

    The FAR and DOSAR do not apply to the acquisition of transportation 
services via Government bill of lading (GBL) or other similar forms.
[59 FR 66767, Dec. 28, 1994]



PART 648--VALUE ENGINEERING--Table of Contents




    Authority:  22 U.S.C. 2658; 40 U.S.C. 486(c); 48 CFR 1.3.

[[Page 550]]



                 Subpart 648.1--Policies and Procedures



648.102  Policies.

    (a) The authority to grant exemptions prescribed in FAR 48.102(a), 
or to extend future contract savings or sharing pursuant to FAR 
48.102(g), is delegated, without power of redelegation, to the head of 
the contracting activity (see 601.603-70).
[55 FR 5775, Feb. 16, 1990]



                     Subpart 648.2--Contract Clauses



648.201  Clauses for supply or service contracts.

    The authority to determine exemptions prescribed in FAR 48.201(a)(6) 
is delegated, without power of redelegation, to the head of the 
contracting activity.
[55 FR 5775, Feb. 16, 1990]



PART 649--TERMINATION OF CONTRACTS--Table of Contents




    Authority:  40 U.S.C. 485(c); 22 U.S.C. 2658.



                   Subpart 649.1--General Principles.



649.106  Fraud or other criminal conduct.

    If the Termination Contracting Officer (TCO) suspects fraud or other 
criminal conduct related to the settlement of a terminated contract, the 
TCO shall discontinue negotiations and report the facts to the Office of 
the Inspector General.
[59 FR 66767, Dec. 28, 1994]



649.111  Review of proposed settlements.

    All proposed termination settlements shall be reviewed and approved 
by the Office of the Legal Adviser for legal sufficiency. In addition,
    (a) All proposed termination settlements from domestic contracting 
activities shall be approved by the head of the contracting activity; 
and,
    (b) All proposed termination settlements from overseas contracting 
activities shall be approved by the Procurement Executive.
[59 FR 66767, Dec. 28, 1994]



PART 651--USE OF GOVERNMENT SOURCES BY CONTRACTORS--Table of Contents




    Authority:  40 U.S.C. 486(c); 22 U.S.C. 2658.



   Subpart 651.70--Contractor Use of Travel Advances, Official Travel 
               Orders, and Government Travel Requisitions



651.701  Policy.

    (a) It is the Department's policy that contractors shall not:
    (1) Receive travel advances from the Department for contract-related 
travel;
    (2) Travel under official travel orders; or,
    (3) Receive Government Travel Requisitions (GTRs) for 
transportation.
    (b) All contract-related travel shall be performed on the 
contractor's account with reimbursement provided after submission of a 
proper voucher.
    (c) This policy does not apply to personal services contractor; 
provided, that such contractors are paid through the Department's 
payroll system and they are subject to the standard payroll deductions 
of Federal Withholding Tax and FICA. It also does not apply to contracts 
awarded by the Office of Language Services (A/OPR/LS).
[59 FR 66767, Dec. 28, 1994]

[[Page 551]]



                     SUBCHAPTER H--CLAUSES AND FORMS





PART 652--SOLICITATION PROVISIONS AND CONTRACT CLAUSES--Table of Contents




Sec.
652.000  Scope of part.

      Subpart 652.1--Instructions for Using Provisions and Clauses

652.100  Scope of subpart.
652.100-70  Policy.
652.102  Incorporating provisions and clauses.
652.102-1  Incorporation by reference.

             Subpart 652.2--Texts of Provisions and Clauses

652.200  Scope of subpart.
652.203-70  Prohibition Against the Use of Federal Employees.
652.203-71  Certification Regarding Federal Employment.
652.204-70  Security Requirements.
652.204-71  Security Requirements--Personnel.
652.206-70  Competition Advocacy/Ombudsman.
652.214-70  Notices.
652.214-71  Authorization to Perform.
652.216-70  Ordering--Indefinite-Delivery Contract.
652.216-71  Price Adjustment.
652.219-70  Department of State Subcontracting Goals.
652.223-70  Estimates of the Total Percentage of Recovered Materials to 
          be Utilized in the Performance of the Contract.
652.223-71  Certification of Minimum Content Actually Utilized in the 
          Performance of the Contract.
652.223-72  Use of Double-Sided Copying in the Submissions of Bids or 
          Proposals.
652.223-73  Use of Double-Sided Copying in the Submission of Reports.
652.223-74  Use of Fly Ash as a Partial Replacement for Cement and 
          Concrete.
652.223-75  Use of Recovered Materials in Building Insulation Products.
652.223-76  Use of Lubricating Oils Containing Re-Refined Oils.
652.223-77  Use of Retread Tires.
652.223-78  Use of Recovered Materials in Paper and Paper Products.
652.228-70  Indemnification.
652.228-71  Worker's Compensation Insurance (Defense Base Act)--
          Services.
652.228-72  Worker's Compensation Insurance (Defense Base Act)--
          Construction.
652.228-73  Waiver of the Defense Base Act.
652.228-74  Defense Base Act Insurance Rates--Limitation--Services.
652.228-75  Defense Base Act Insurance Rates--Limitation--Construction.
652.228-76  Defense Base Act Insurance Rates--Limitation--Cost-
          Reimbursement.
652.228-77  Defense Base Act Insurance Rates--Limitation--Labor-Hour and 
          Time-and-Materials.
652.229-70  Excise Tax Exemption Statement for Contractors Within the 
          United States.
652.232-70  Payment Schedule and Invoice Submission (Fixed-Price).
652.232-71  Voucher Submission (Cost-Reimbursement).
652.237-70  Compensatory time off.
652.237-71  Identification/Building Pass.
652.237-72  Observance of Legal Holidays and Administrative Leave.
652.242-70  Contracting Officer's Representative (COR).
652.242-71  Notice of Shipments.
652.242-72  Shipping Instructions.
652.246-70  Commercial Warranty.

    Authority:  40 U.S.C. 486(c); 22 U.S.C. 2658.

    Source:  53 FR 26177, July 11, 1988, unless otherwise noted.



652.000  Scope of part.

    This part sets forth solicitation provisions and contract clauses, 
in addition to those prescribed in FAR Part 52, for use in DOS 
acquisitions.



      Subpart 652.1--Instructions for Using Provisions and Clauses



652.100  Scope of subpart.



652.100-70  Policy.

    (a) The solicitation provisions and contract clauses in FAR Subpart 
52.2 or this Subpart 652.2 shall be used as prescribed therein, except 
when the use of any provision or clause is prohibited by or inconsistent 
with local laws, or the supplies or services could not be obtained if 
the provision or clause were to be included.
    (b) The contracting officer shall justify the exclusion of any 
provisions or clauses in accordance with FAR Subpart 1.4 and 601.470.

[[Page 552]]



652.102  Incorporating provisions and clauses.



652.102-1  Incorporation by reference.

    The Procurement Executive is the agency head for the purposes of FAR 
52.102-1(a)(2)(ii).



             Subpart 652.2--Texts of Provisions and Clauses



652.200  Scope of subpart.

    This subpart sets forth the text of all DOSAR provisions and 
clauses, and for each provision and clause provides a cross-reference to 
the location in the DOSAR that prescribes its use.



652.203-70  Prohibition Against the Use of Federal Employees.

    As prescribed in 603.670, insert the following clause:

       Prohibition Against the Use of Federal Employees (Dec 1994)

    In accordance with Federal Acquisition Regulation 3.601, contracts 
are not to be awarded to Federal employees or a business concern or 
other organization owned or substantially owned or controlled by one or 
more Federal employees. For the purposes of this contract, this 
prohibition against the use of Federal employees includes any work 
performed by the contractor or any of its employees, subcontractors, or 
consultants.

(End of clause)
[59 FR 66767, Dec. 28, 1994]



652.203-71  Certification Regarding Federal Employment.

    As prescribed in 603.670, insert the following provision:

          Certification Regarding Federal Employment (Dec 1994)

    By submitting an offer, the offeror hereby certifies that it is not 
owned or substantially owned or controlled by one or more Federal 
employees.

(End of provision)
[59 FR 66767, Dec. 28, 1994]



652.204-70  Security Requirements.

    As prescribed in 604.404-70, insert the following clause in 
solicitations and contracts performed outside the United States to the 
extent the contract involves access to classified information 
(``Confidential,'' ``Secret,'' or ``Top Secret'') or administratively 
controlled information (``Limited Official Use''). Contractors or 
contract employees that are not U.S. citizens shall not have access to 
classified or administratively controlled information.

                    Security Requirements (July 1988)

    (a) This clause applies to the extent that this contract involves 
information the Government has determined to be classified 
(``Confidential,'' ``Secret,'' or ``Top Secret,'' hereinafter referred 
to as ``classified'') or administratively controlled (``Limited Official 
Use,'' hereinafter referred to as ``administratively controlled'').
    (b) The Contractor (1) shall be responsible for safeguarding all 
classified or administratively controlled information in accordance with 
paragraph (d) below and shall not supply, disclose, or otherwise permit 
any unauthorized person access to classified or administratively 
controlled information; (2) shall not make or permit to be made any 
reproductions of classified information or administratively controlled 
information, except with the prior written authorization of the 
Contracting Officer, Post Security Officer, or Regional Security 
Officer; (3) shall submit to the Contracting Officer, at such times as 
the Contracting Officer may direct, an accounting of all reproductions 
of classified or administratively controlled information; and (4) shall 
not incorporate in any other project any matter which will disclose 
classified or administratively controlled information except with the 
prior written authorization of the Contracting Officer.
    (c) The Contractor shall not permit any non-U.S. citizen access to 
classified or administratively controlled information. The Contractor 
shall not permit any individual access to classified information without 
the prior written authorization of the Contracting Officer, Post 
Security Officer, or Regional Security Officer.
    (d) The Contractor shall follow the procedures for classifying, 
marking, handling, transmitting, disseminating, storage, and destroying 
official materials in accordance with the Uniform Regulations (Foreign 
Affairs Manual, Volume 5, Chapter 900, ``Policy and Procedural 
Security''). The Contracting Officer, Post Security Officer, or Regional 
Security Officer shall provide a copy of this document to the 
Contractor. The Contracting Officer shall provide any supplements to 
these regulations to the Contractor in writing.
    (e) The Contractor agrees to submit immediately to the Contracting 
Officer, Post Security Officer, a complete detailed report, 
appropriately classified, of any information which the Contractor may 
have concerning existing or threatened espionage, sabotage, or 
subversive activity.

[[Page 553]]

    (f) The Government agrees that when necessary it shall indicate by 
security classification or administratively controlled designation the 
degree of importance to the national security of information to be 
furnished by the Contractor to the Government or by the Government to 
the Contractor. The Government shall give written notice to the 
Contractor of such security classification or administratively 
controlled designation and of any subsequent changes thereof. The 
Contractor shall rely on any letter or other written instrument signed 
by the Contracting Officer changing a security classification or 
administratively controlled designation of information.
    (g) The Contractor agrees to certify after completion of this 
contract that it has surrendered or disposed of all classified or 
administratively controlled information in its custody in accordance 
with applicable security regulations or instructions.

                             (End of clause)



652.204-71  Security Requirements--Personnel.

    As prescribed in 604.404-70, insert the following clause in 
solicitations and contracts performed outside the United States.

              Security Requirements--Personnel (July 1988)

    The Contractor agrees, if directed by the Contracting Officer, to 
furnish the Government with the name, date and place of birth, current 
address, and such other biographical information as is readily available 
to the Contractor, concerning any individual before permitting said 
individual to perform under this contract. The Contractor further agrees 
to permit only those individuals approved by the Government to be used 
in the performance of this contract.

                             (End of clause)



652.206-70  Competition Advocacy/Ombudsman.

    As prescribed in 606.570, insert the following provision:

                Competition Advocacy/Ombudsman (Dec 1994)

    The Department of State's Competition Advocate is responsible for 
assisting industry in removing restrictive requirements from Department 
of State solicitations and removing barriers to full and open 
competition. If such a solicitation is considered competitively 
restrictive or does not appear properly conducive to competition and 
contracting practices, potential offerors are encouraged to first 
contact the contracting office for the respective solicitation 
identified elsewhere in this solicitation. If concerns are not 
adequately addressed, contact the Department of State Competition 
Advocate on (703) 516-1680, or write to: U.S. Department of State, 
Competition Advocate, Office of the Procurement Executive, A/OPE/CA, 
Suite 603, SA-6, Washington, DC 20522-0602.

(End of provision)
[59 FR 66767, Dec. 28, 1994]



652.214-70  Notices.

    As prescribed in 614.201-7-70(b), insert the following clause in 
solicitations and contracts entered into and performed outside the 
United States.

                           Notices (DEC 1994)

    Any notice or request relating to this contract given by either 
party to the other shall be in writing. Said notice or request shall be 
mailed or delivered by hand to the other party at the address provided 
in the schedule of the contract. All modifications to the contract must 
be made in writing by the Contracting Officer.

                             (End of clause)

[53 FR 26177, July 11, 1988. Redesignated and amended at 59 FR 66767, 
Dec. 28, 1994]



652.214-71  Authorization to Perform.

    As prescribed in 614.201-7-70(c), insert the following provisions:

                   Authorization to Perform (DEC 1994)

    The Contractor warrants that (a) it has obtained authorization to 
operate and do business in the country or countries in which this 
contract will be performed; (b) it has obtained all necessary licenses 
and permits required to perform this contract; and (c) it shall comply 
fully with all laws, decrees, labor standards and regulations of said 
country or countries during the performance of this contract.

                           (End of provision)

[53 FR 26177, July 11, 1988. Redesignated and amended at 59 FR 66767, 
Dec. 28, 1994]



652.216-70  Ordering--Indefinite-Delivery Contract.

    As prescribed in 616.505-70, insert the following clause in 
solicitations and contracts when a definite-quantity contract, a 
requirements contract, or an indefinite-quantity contract is 
contemplated.

[[Page 554]]

           Ordering--Indefinite-Delivery Contracts (Dec 1994)

    The Government shall use one of the following forms to issue orders 
under this contract:
    (a) The Optional Form 347, Order for Supplies or Services, and 
Optional Form 348, Order for Supplies or Services Schedule--
Continuation; or,
    (b) The Optional Form 206, Purchase Order, Receiving Report and 
Voucher, and Optional Form 206A, Continuation Sheet.

(End of clause)
[53 FR 26177, July 11, 1988, as amended at 59 FR 66768, Dec. 28, 1994]



652.216-71  Price Adjustment.

    As prescribed in 616.203-4, insert a clause substantially the same 
as follows:

                       Price Adjustment (Dec 1994)

    (a) The contract cost may be adjusted based on increases or 
decreases in actual costs of direct service labor which result directly 
from laws enacted and effective during the term of this contract by the 
[insert name of country] Government.
    (b) For the contracting officer to consider any request for 
adjustment, the contractor shall demonstrate in writing:
    (1) That the change in the law occurred subsequent to the award date 
of the contract; and,
    (2) That the change in the law could not have been reasonably 
anticipated prior to contract award; and,
    (3) How the change in the law directly affects the direct cost of 
direct service labor under the contract.
    (c) The contractor shall present documentation that clearly supports 
any request for adjustment, including the calculation of the amount of 
adjustment requested. This documentation must identify and provide the 
appropriate portions of the text of the particular law from which the 
request is derived.
    (d) Any request for adjustment shall be certified by signature by an 
officer or general partner of the contractor having overall 
responsibility for the conduct of the contractor's affairs.
    (e) No adjustment shall be made to the contract price that relates 
to any overhead, fixed costs, profit or fee for the contractor. Only the 
amount charged to direct service labor cost shall be considered by the 
Government as basis for contract price adjustments.
    (f) No request by the contractor for an adjustment under this clause 
shall be allowed if asserted after final payment under this contract has 
been made.
    (g) This clause shall only apply to laws enacted by the [insert name 
of country] Government meeting the criteria set forth above in paragraph 
(a). No adjustments shall be made due to currency devaluations 
fluctuations in exchange rates.

(End of clause)
[59 FR 66768, Dec. 28, 1994]



652.219-70  Department of State Subcontracting Goals.

    As prescribed in 619.708-70, insert a provision substantially the 
same as follows:

           Department of State Subcontracting Goals (Dec 1994)

    (a) The offeror shall provide a Small, Small Disadvantaged and 
Woman-Owned Enterprise Subcontracting Plan that details its approach to 
selecting and using Small, Small Disadvantaged, and Woman-Owned Business 
Enterprises as requested by the contracting officer.
    (b) For the fiscal year [insert appropriate fiscal year], the 
Department's subcontracting goals are as follows:

(1) Goal for subcontracting to SB: ________________
(2) Goal for subcontracting to SDB: ________________
(3) Goal for subcontracting to SWB: ________________
(4) Omnibus goals (if applicable):
    (i) 10% to minority business
    (ii) 10% to small business

(End of provision)
[59 FR 66768, Dec. 28, 1994]



652.223-70  Estimates of the Total Percentage of Recovered Materials to be Utilized in the Performance of the Contract.

    As prescribed in 623.480(a), insert the following provision:

Estimates of the Total Percentage of Recovered Materials to be Utilized 
              in the Performance of the Contract (Dec 1994)

    (a) As required under Section 6002 of the Resource Conservation and 
Recovery Act, an officer or employee of the offeror shall estimate the 
total percentage of recovered material to be utilized in the performance 
of the contract.
    (b) I, (insert name of certifier) am an officer employee responsible 
for the preparation of this offer and hereby estimate the total 
percentage of recovered material to be utilized in the performance of 
the contract as follows:

[[Page 555]]



                                                                        
------------------------------------------------------------------------
                                         Estimate of total percent of   
              Product                 recovered material to be utilized 
------------------------------------------------------------------------
                                                                        
                                                                        
------------------------------------------------------------------------
                                                                        
                                                                        
------------------------------------------------------------------------
                                                                        
                                                                        
------------------------------------------------------------------------
------------------------------------------------------------------------

(End of provision)
[59 FR 66768, Dec. 28, 1994]



652.223-71  Certification of Minimum Content Actually Utilized in the Performance of the Contract.

    As prescribed in 623.480(b), insert the following clause:

Certification of Minimum Content Actually Utilized in the Performance of 
                         the Contract (Dec 1994)

    (a) As required under Section 6002 of the Resource Conservation and 
Recovery Act, an officer or employee of the contractor shall execute the 
following certification:
    I, (insert name of certifier) am an officer or employee responsible 
for the performance of this contract and hereby certify the following 
minimum recovered material content was actually utilized in the 
performance of this contract:

                                                                        
------------------------------------------------------------------------
                                         Percent of minimum recovered   
              Product                     material actually utilized    
------------------------------------------------------------------------
                                                                        
                                                                        
------------------------------------------------------------------------
                                                                        
                                                                        
------------------------------------------------------------------------
                                                                        
------------------------------------------------------------------------
------------------------------------------------------------------------

    (b) The contractor shall submit this certification by January 31 in 
each year during the period of performance of this contract. The period 
of the certification shall cover the preceding calendar year.

 _______________________________________________________________________
Signature of the officer or employee

 _______________________________________________________________________
Typed name of officer or employee

 _______________________________________________________________________
Title

 _______________________________________________________________________
Name of company, firm, or organization

 _______________________________________________________________________
Date

(End of clause)
[59 FR 66768, Dec. 28, 1994]



652.223-72  Use of Double-Sided Copying in the Submissions of Bids or Proposals.

    As prescribed in 623.480(c), insert the following provision:

Use of Double-Sided Copying in the Submissions of Bids or Proposals (Dec 
                                  1994)

    (a) For the purposes of this provision, ``double-sided copying'' 
means copying two one-sided originals on to the front and back side of 
one sheet of paper.
    (b) Unless otherwise stated in the solicitation, offerors shall use 
double-sided copying to reproduce all bids or proposals in response to 
this solicitation.

(End of provision)
[59 FR 66768, Dec. 28, 1994]



652.223-73  Use of Double-Sided Copying in the Submission of Reports.

    As prescribed in 623.480(d), insert the following clause:

   Use of Double-Sided Copying in the Submission of Reports (Dec 1994)

    (a) For the purposes of this clause, ``double-sided copying'' means 
copying two one-sided originals on to the front and back side of one 
sheet of paper.
    (b) Unless otherwise stated in this contract or otherwise directed 
by the contracting officer, the contractor shall use double-sided 
copying to reproduce any progress report, draft report, of final report 
produced under this contract.

(End of clause)
[59 FR 66769, Dec. 28, 1994]



652.223-74  Use of Fly Ash as a Partial Replacement for Cement and Concrete.

    As prescribed in 623.480(e), insert the following clause:

  Use of Fly Ash as a Partial Replacement for Cement and Concrete (Dec 
                                  1994)

    The Architect/Engineer shall specify the performance requirements of 
the cement and concrete products required under the contract using 
standard specifications when available. Consistent with such performance 
specifications, the Architect/Engineer shall specify the use of fly ash, 
a finely divided residue resulting from the combustion of coal, as a 
partial replacement for cement and concrete to the maximum extent 
practicable in accordance with ANSI/ASTM Standards and all applicable 
codes.

(End of clause)
[59 FR 66769, Dec. 28, 1994]

[[Page 556]]



652.223-75  Use of Recovered Materials in Building Insulation Products.

    As prescribed in 623.480(f), insert the following clause:

  Use of Recovered Materials in Building Insulation Products (Dec 1994)

    (a) This clause applies to building insulation products used in the 
construction of ceilings, floors, foundations, and walls, and includes 
blanket, board, spray-in place and loose-fill insulations.
    (b) The Department's minimum content standard for recovered material 
in building insulation products is set forth below.

                                                                        
------------------------------------------------------------------------
               Material type                      Percent by weight     
------------------------------------------------------------------------
Cellulose loose-fill and spray on.........  75% post-consumer recovered 
                                             material.                  
Perlite composition board.................  23% post-consumer recovered 
                                             paper.                     
Plastic Rigid Foams--polyisocyanurate/                                  
 polyurethane:                                                          
    Rigid foam............................  9% recovered material.      
    Foam-in-place.........................  5% recovered material.      
    Glass fiber reinforced................  6% recovered material.      
Phenolic rigid foam.......................  5% recovered material.      
Rock Wool.................................  75% recovered material.     
------------------------------------------------------------------------


    Note:  The minimum content standards are based on the weight of the 
material (not volume) in the insulating core only.

    (c) The Architect/Engineer shall include as a design consideration 
the Department's preference for the use of building insulation produced 
with recovered materials. The Architect/Engineer shall specify the type 
of building insulation products to be supplied, and shall justify in 
writing the basis of the selected product type if it is listed above, or 
if any product listed above has a higher minimum content standard than 
the selected product.

(End of clause)
[59 FR 66769, Dec. 28, 1994]



652.223-76  Use of Lubricating Oils Containing Re-Refined Oils.

    As prescribed in 623.480(g), insert the following clause:

      Use of Lubricating Oils Containing Re-Refined Oils (Dec 1994)

    (a) If the contractor is required to supply lubricating oils, 
hydraulic fluids, or gear oils under this contract, the contractor shall 
supply products conforming to the listed military specifications as set 
forth below unless the contracting officer determines that the listed 
products will not satisfy the Department's needs.

             EPA Lubricating Oils Containing Re-Refined Oil

(1) Engine Lubricating Oils
    (i) MIL-L-46152 (or current version)--Lubricating Oil Internal 
Combustion Engine, Administrative Service
    (ii) API Engine Service Category SF-1980 Gasoline Engine Warranty 
Maintenance Service
    (iii) API Engine Service Category CC-Diesel Engine Service
    (iv) MIL-L-2104D (or current version)--Lubricating Oil Internal 
Combustion Engine, Tactical Service
    (v) API Engine Service Category CD-Diesel Engine Service
    (vi) MIL-L-21260D (or current version)--Lubricating Oil Internal 
Combustion Engine, Preservative and Break-In
    (vii) MIL-L-4617 (or current version)--Lubricating Oil, Internal 
Combustion Engine, Arctic
(2) Hydraulic Fluids
    (i) MIL-H-5606 (or current version)--Hydraulic Fluid, Petroleum 
Base: Aircraft, Missile, and Ordnance
    (ii) MIL-H-6083 (or current version)--Hydraulic Fluid, Petroleum 
Base: Preservation and Operation
(3) Gear Oils
    (i) MIL-L-2105d (or current version)--Lubricating Oil, Gear, 
Multipurpose

    (b) Copies of the above specifications may be obtained from: 
Standardization Document Order Desk, Building 4, Section D, 700 Robbins 
Avenue, Philadelphia, PA 19111-5094.
    (c) Any lubricating oils, hydraulic fluids, or gear oils delivered 
under this contract that conform to the above listed military 
specifications shall contain a minimum of 25% re-refined oils.

(End of clause)
[59 FR 66769, Dec. 28, 1994]



652.223-77  Use of Retread Tires.

    As prescribed in 623.480(h), insert the following clause:

                     Use of Retread Tires (Dec 1994)

    (a) If the contractor is required to maintain or replace Government 
tires under this

[[Page 557]]

contract, the contractor shall to the maximum extent practicable obtain 
retreading services for existing tires, if the carcass is retreadable, 
from firms identified in the U.S. General Services Administration's 
Federal Supply Schedule 26 II, Pneumatic Tires.
    (b) If such retreading services are not practicable, replacement 
retread tires shall be procured in accordance with GSA specification ZZ-
T-381 for replacement tires.

(End of clause)
[59 FR 66769, Dec. 28, 1994]



652.223-78  Use of Recovered Materials in Paper and Paper Products.

    As prescribed in 623.480(i), insert the following clause:

    Use of Recovered Materials in Paper and Paper Products (Dec 1994)

    (a) If the contractor is required under this contract to deliver any 
of the paper and paper products listed below, all such items delivered 
shall meet the minimum content standards for recovered materials, 
postconsumer recovered materials, or waste paper set forth in paragraph 
(b).
    (1) Recovered materials are defined as waste material and by-
products that have been recovered or diverted from solid waste, not 
including those materials and by-products generated from, and commonly 
reused within, an original manufacturing process.
    (2) Postconsumer recovered materials are defined as waste materials 
recovered from retail stores, office buildings, homes and so forth after 
they passed through their end usage as a consumer item.
    (3) Waste paper is defined as all items from the first two 
categories above in addition to forest residues, and manufacturing and 
other wastes.
    (b) Unless otherwise stated in this contract or otherwise directed 
by the contracting officer, the contractor shall use ``High Grade 
Bleached Printing and Writing Papers'' as defined in this clause to 
produce all progress reports, final reports, and any other products 
required to be delivered to the Government under this contract.

     Minimum Content Standards for Selected Paper and Paper Products

                                Newsprint

40% minimum postconsumer recovered materials

             High Grade Bleached Printing and Writing Papers

Offset printing--50% minimum waste paper
Mimeo and duplicator paper--50% minimum waste paper
Writing (stationery)--50% minimum waste paper
Office paper (e.g., note pads)--50% minimum waste paper
Paper for high speed copiers--50% minimum waste paper
Envelopes--50% minimum waste paper
Form bond including computer paper and carbonless--50% minimum waste 
paper
Book papers--50% minimum waste paper
Bond papers--50% minimum waste paper
Ledger--50% minimum waste paper
Cover stock--50% minimum waste paper
Cotton fiber papers--25% minimum recovered materials and 50% minimum 
waste paper

                             Tissue Products

Toilet tissue--20% minimum postconsumer recovered materials
Paper towels--40% minimum postconsumer recovered materials
Paper napkins--30% minimum postconsumer recovered materials
Facial tissue--5% minimum postconsumer recovered materials
Doilies--40% minimum postconsumer recovered materials
Industrial wipes--0% minimum postconsumer recovered materials

                          Unbleached Packaging

Corrugated boxes--35% minimum postconsumer recovered materials
Fiber boxes--35% minimum postconsumer recovered materials
Brown papers (e.g., bags)--5% minimum postconsumer recovered materials

                           Recycled Paperboard

Reclycled paperboard products--80% minimum postconsumer recovered 
materials
Pad backing--90% minimum postconsumer recovered materials

(End of clause)
[59 FR 66769, Dec. 28, 1994]



652.228-70  Indemnification.

    As prescribed in 628.7001(b), insert the following clause in 
solicitations and contracts when the contractor's assumption of risk is 
in the best interest of the Government.

                       Indemnification (July 1988)

    The Contractor expressly agrees to indemnify and to save the 
Government, its officers, agents, servants, and employees harmless from 
and against any claim, loss, damages, injury, and liability, however 
caused, resulting from or arising out of the Contractor's fault or 
negligence in connection with the performance of work under this 
contract. Further, any negligence or alleged negligence of the 
Government, its officers, agents, servants, or employees, shall not bar

[[Page 558]]

a claim for indemnification unless the act or omission of the 
Government, its officers, agents, servants, or employees is the sole 
competent, and producing cause of such claim, loss, damages, injury, or 
liability.

                             (End of clause)



652.228-71  Worker's Compensation Insurance (Defense Base Act)--Services.

    As prescribed in 628.305(b)(1), insert the following clause:

 Worker's Compensation Insurance (Defense Base Act)--Services (Dec 1994)

    (a) This clause supplements FAR 52.228-3.
    (b) The contractor agrees to procure Defense Base Act (DBA) 
insurance pursuant to the terms of the contract between the Department 
of State and the Department's DBA insurance carrier unless the 
contractor has a DBA self-insurance program approved by the Department 
of Labor. The contractor shall submit a copy of the Department of 
Labor's approval to the contracting officer upon contract award.
    (c) Since the Department of State has secured a waiver of DBA 
coverage for contractor's employees who are not citizens of, residents 
of, or hired in the United States, the contractor agrees to provide such 
employees with worker's compensation benefits as required by the laws of 
the country in which the employees are working, or by the laws of the 
employee's native country, whichever offers greater benefits.
    (d) The contractor agrees to insert a clause substantially the same 
as this one in all subcontracts to which the DBA is applicable. 
Subcontractors shall be required to insert a similar clause in any of 
their subcontracts subject to the DBA.
    (e) The cost of DBA insurance is paid on an annual basis. If the 
period of performance of this contract extends beyond one year, the 
Department shall reimburse the contractor for any additional insurance 
cost on a reimbursable basis through a contract modification.
    (f) Should the rates for DBA insurance coverage increase during the 
performance of this contract, the Department shall reimburse the 
contractor for the increased cost through a contract modification. In 
the event the DBA insurance rates decrease during contract performance, 
the contractor shall reduce the reimbursable cost proportionately.

(End of clause)
[59 FR 66770, Dec. 28, 1994]



652.228-72  Worker's Compensation Insurance (Defense Base Act)--Construction.

    As prescribed in 628.305(b)(2), insert the following clause:

 Worker's Compensation Insurance (Defense Base Act)--Construction (Dec. 
                                  1994)

    (a) This clause supplements FAR 52.228-4.
    (b) The contractor agrees to procure Defense Base Act (DBA) 
insurance pursuant to the terms of the contract between the Department 
of State and the Department's DBA insurance carrier unless the 
contractor has a DBA self-insurance program approved by the Department 
of Labor. The contractor shall submit a copy of the Department of 
Labor's approval to the contracting officer upon contract award. The 
current rate under the Department of State contract is [contracting 
officer insert current rate] of compensation for construction.
    (c) Since the Department of State has secured a waiver of DBA 
coverage for contractor's employees who are not citizens of, residents 
of, or hired in the United States, the contractor agrees to provide such 
employees with worker's compensation benefits as required by the laws of 
the country in which the employees are working, or by the laws of the 
employee's native country, whichever offers greater benefits.
    (d) The contractor agrees to insert a clause substantially the same 
as this one in all subcontracts to which the DBA is applicable. 
Subcontractors shall be required to insert a similar clause in any of 
their subcontracts subject to the DBA.
    (e) Should the rates for DBA insurance coverage increase or decrease 
during the performance of this contract, the Department shall modify 
this contract accordingly.
    (f) The contractor shall demonstrate to the satisfaction of the 
contracting officer that the equitable adjustment as a result of the 
insurance increase or decrease does not include any reserve for such 
insurance. Adjustment shall not include any overhead, profit, general 
and administrative expense, etc.

(End of clause)
[59 FR 66770, Dec. 28, 1994]



652.228-73  Waiver of the Defense Base Act.

    As prescribed in 628.305(b)(3), insert the following clause:

                Waiver of the Defense Base Act (Dec 1994)

    (a) Upon recommendation of the Secretary of State, the Secretary of 
Labor may waive the applicability of the Defense Base Act with respect 
to any contract, subcontract, or

[[Page 559]]

subordinate contract; work location; or classification of employees.
    (b) Either the contractor or the Department of State may request a 
waiver from coverage. Such a waiver may apply to any employees who are 
not U.S. citizens, not residents of, or are not hired in the United 
States. Waivers requested by the contractor shall be submitted to the 
contracting officer for approval and further submission to the 
contracting officer for approval and further submission to the 
Department of Labor. Application for a waiver shall be submitted on 
Department of Labor Form BEC-565. Where such waivers are granted from 
coverage under the DBA, the waiver is conditioned on providing other 
worker's compensation coverage to employees to which the waiver applies. 
Usually this takes the form of securing worker's compensation coverage 
of the country where work will be performed or of the employee's native 
country, whichever offers greater benefits. Information as to whether a 
DBA waiver has been obtained by the Department for a particular country 
may be obtained from the contracting officer.

(End of clause)
[59 FR 66770, Dec. 28, 1994]



652.228-74  Defense Base Act Insurance Rates--Limitation--Services.

    As prescribed in 628.306(a)(1), insert the following provision:

    Defense Base Act Insurance Rates--Limitation--Services (Dec 1994)

    (a) The Department of State has entered into a contract with an 
insurance carrier to provide DBA insurance to Department of State 
contractors at a contracted rate. The rates for this insurance are as 
follows:
    Services @ [contracting officer insert current rate] of 
compensation.
    (b) Bidders/Offerors should compute the total compensation (direct 
salary plus differential, but excluding per diem, housing allowance and 
other miscellaneous post allowances) to be paid to employees who will be 
covered by DBA insurance and the cost of DBA insurance in their bid/
proposal using the foregoing rate, and insert the totals in the spaces 
provided. The DBA insurance cost shall be included in the total fixed 
price. The DBA insurance costs shall be reimbursed directly to the 
contractor.

(1) Compensation of Covered Employees: ________________

(2) Defense Base Act Insurance Costs: ________________

(3) Total Cost: ________________

    (c) Bidders/Offerors shall include a statement as to whether or not 
local nationals or third country nationals will be employed on the 
resultant contract.

(End of provision)
[59 FR 66771, Dec. 28, 1994]



652.228-75  Defense Base Act Insurance Rates--Limitation--Construction.

    As prescribed in 628.306(a)(2), insert the following provision:

  Defense Base Act Insurance Rates--Limitation--Construction (Dec 1994)

    (a) The Department of State has entered into a contract with an 
insurance carrier to provide DBA insurance to Department of State 
contractors at a contracted rate. The rates for this insurance are as 
follows:
    Construction @ [contracting officer insert current rate] of 
compensation.
    (b) Bidders/Offerors should compute the total compensation (direct 
salary plus differential, but excluding per diem, housing allowance and 
other miscellaneous post allowances) to be paid to employees who will be 
covered by DBA insurance and the cost of DBA insurance in their bid/
proposal using the foregoing rate, and insert the totals in the spaces 
provided for the base year and each year thereafter, if applicable The 
DBA insurance cost shall be included in the total fixed price. The DBA 
insurance costs shall be reimbursed directly to the contractor.

(1) Compensation of Covered Employees: ________________

(2) Defense Base Act Insurance Costs: ________________

(3) Total Cost: ________________

(End of provision)
[59 FR 66771, Dec. 28, 1994]



652.228-76  Defense Base Act Insurance Rates--Limitation--Cost-Reimbursement.

    As prescribed in 628.307, insert the following provision:

 Defense Base Act Insurance Rates--Limitation--Cost-Reimbursement (Dec 
                                  1994)

    (a) The Department of State has entered into a contract with an 
insurance carrier for Defense Base Act (DBA) insurance which applies to 
all contracts entered into by the Department which requires DBA 
insurance coverage. In preparing the cost proposal, the offeror shall 
use the following rates in computing the cost for such insurance:
    Services--[contracting officer insert current rate] of compensation 
(direct salary plus differential but excluding per diem, housing 
allowance, education allowance, and miscellaneous allowances); and
    (2) Construction--[contracting officer insert current rate] of 
compensation.

[[Page 560]]

    (b) These rates apply to all job classifications in those particular 
categories. The successful offeror shall be advised of the name and 
address of the insurance broker who will process the DBA insurance 
coverage.
    (c) Should an offeror compute or include higher DBA insurance rates, 
the rates shall be disallowed.
    (d) Offerors shall include in their proposals a statement as to 
whether or not local nationals or third country nationals are proposed 
on this contract.

(End of provision)
[59 FR 66771, Dec. 28, 1994]



652.228-77  Defense Base Act Insurance Rates--Limitation--Labor-Hour and Time-and-Materials.

    As prescribed in 628.307-70, insert the following provision:

 Defense Base Act Insurance Rates--Limitation--Labor-Hour and Time-and-
                          Materials (Dec 1994)

    (a) The Department of State has entered into a contract with an 
insurance carrier for Defense Base Act (DBA) insurance which applies to 
all contracts entered into by the Department which requires DBA 
insurance coverage. In preparing the cost proposal, the offeror shall 
use the following rates in computing the cost for such insurance:
    (1) Services--[contracting officer insert current rate] of 
compensation (direct salary plus differential but excluding per diem, 
housing allowance, education allowance, and miscellaneous allowances); 
and
    (2) Construction--[contracting officer insert current rate] of 
compensation.
    (b) These rates apply to all job classifications in those particular 
categories. The successful offeror shall be advised of the name and 
address of the insurance broker who will process the DBA insurance 
coverage.
    (c) Offerors shall include in their proposals a statement as to 
whether or not local nationals or third country nationals are proposed 
on this contract.

(End of provision)
[59 FR 66771, Dec. 28, 1994]



652.229-70  Excise Tax Exemption Statement for Contractors Within the United States.

    As prescribed in 629.401-70, insert the following clause in 
solicitations and contracts if the prospective contractor is located 
inside the United States and the acquisition involves export of supplies 
to an overseas post.

Excise Tax Ememption Statement for Contractors Within the United States 
                               (July 1988)

    This is to certify that the item(s) covered by this contract is/are 
for export solely for the use of the U.S. Foreign Service Post 
identified in the contract schedule.
    The Contractor shall use a photocopy of this contract as evidence of 
intent to export. Final proof of exportation may be obtained from the 
agent handling the shipment. Such proof shall be accepted in lieu of 
payment of excise tax.

                             (End of clause)



652.232-70  Payment Schedule and Invoice Submission (Fixed-Price).

    As prescribed in 632.908(a), the contracting officer may insert a 
clause substantially the same as follows:

    Payment Schedule and Invoice Submission (Fixed-Price) (Dec 1994)

    (a) General. The Government shall pay the contractor as full 
compensation for all work required, performed and accepted under this 
contract, inclusive of all costs and expenses, the firm fixed-price 
stated in Section B of this contract.
[Use paragraph (b) only if partial payments apply. Otherwise, paragraph 
(a) above assumes the contractor will be paid in full amount upon 
completion of all contractural requirements].
    (b) Payment Schedule. Payments will be made in accordance with the 
following partial payment schedule:

                                                                        
------------------------------------------------------------------------
                                  Specific      Delivery       Payment  
     Partial payment No.        deliverable       date         amount   
------------------------------------------------------------------------
1                              .............  ............  ............
2                              .............  ............  ............
3                              .............  ............  ............
------------------------------------------------------------------------

[Continue as necessary]

    (c) Invoice Submission. Invoices shall be submitted in an original 
and [contracting officer insert appropriate number of copies] copies to 
the Office identified in Block 5 of the SF-26 or Block 7 of the SF-33. 
To constitute a proper invoice, the invoice must include all items per 
FAR 52.232-25, ``Prompt Payment''.
    (d) Contractor Remittance Address. Payment shall be made to the 
contractor's address as specified on the cover page of this contract, 
unless a separate remittance address is specified below:

 _______________________________________________________________________

________________________________________________________________________

________________________________________________________________________

________________________________________________________________________

(End of clause)
[59 FR 66771, Dec. 28, 1994]

[[Page 561]]



652.232-71  Voucher Submission (Cost-Reimbursement).

    As prescribed in 632.908(b), the contracting officer may insert a 
clause substantially the same as follows:

           Voucher Submission (Cost-Reimbursement) (Dec 1994)

    (a) General. The contractor shall submit, on a monthly basis 
[contracting officer may substitute a different time frame, if 
appropriate], an original and [contracting officer insert appropriate 
number] copies of each voucher. In addition to the items necessary per 
FAR 52.232-25, ``Prompt Payment'', the voucher shall show the elements 
of cost for the billing period and the cumulative costs to date. All 
vouchers shall be submitted to the office identified in Block 5 of the 
SF-26 or Block 7 of the SF-33.
    (b) Contractor Remittance Address. Payment shall be made to the 
contractor's address as specified on the cover page of this contract, 
unless a separate remittance address is specified below:

 _______________________________________________________________________

________________________________________________________________________

________________________________________________________________________

________________________________________________________________________

(End of clause)
[59 FR 66772, Dec. 28, 1994]



652.237-70  Compensatory time off.

    As prescribed in 637.110(a), insert the following clause:

                    Compensatory Time Off (Dec 1994)

    (a) Compensatory time off means time from work during the personal 
service contract employee's basic work week in exchange for performing 
an equal amount of irregular of occasional overtime work which is 
officially ordered or approved.
    (b) At the discretion of the Contracting Officer's Representative 
(COR), the contractor may earn compensatory time off in accordance with 
3 FAM Section 232.6--Compensatory Time Off. Compensation time off 
remaining to the credit of a personal services contract employee at the 
end of a 16-week period and/or at the end of the contract period shall 
be forfeited.
    (c) Compensatory time may not be converted to overtime.

(End of clause)
[59 FR 66772, Dec. 28, 1994]



652.237-71  Identification/Building Pass.

    As prescribed in 637.110(b), insert the following clause.

                 Identification/Building Pass (Dec 1994)

    (a) The contractor shall obtain a Department of State building pass 
for all employees performing under this contract who require frequent 
and continuing access to Department of State facilities. Passes shall be 
issued only to contractor employees who are United States citizens. 
Passes will be issued by the Bureau of Diplomatic Security, Office of 
Procedural Security, Domestic Facilities Division. They shall be used 
for the purpose of contractor performance only, and shall not be used 
for any other purpose.
    (b) The contractor shall submit an application in the form 
prescribed by the COR. The contractor shall also provide a letter on 
company letterhead to accompany the application containing the following 
information:
    (1) The purpose for which the pass is being requested;
    (2) The type of access the applicant requires;
    (3) Whether or not the applicant has a valid security clearance; 
and,
    (4) The contract number and period of performance of the contract.
    (c) The complete package, including the COR's approval memorandum, 
shall be delivered to the Building Pass Application Unit, Room 309, 
State Annex Number 1, Columbia Plaza, 2401 E Street, NW., Washington, 
DC; or, the post security officer, if the contract is performed at a 
U.S. owned or leased building overseas. The employee(s) for whom the 
pass(es) is/are being requested may be required to personally submit the 
application and to provide evidence of identity and United States 
citizenship.
    (d) All contractor employees shall wear the passes in plain sight at 
all times while in Department of State buildings. All contractor 
employees shall show their passes when entering these buildings and upon 
request.
    (e) All passes shall be returned to the COR upon separation of the 
employee, or expiration or termination of the contract. Final payment 
under this contract shall not be made until all passes are returned to 
the COR.

(End of clause)
[59 FR 66772, Dec. 28, 1994]



652.237-72  Observance of Legal Holidays and Administrative Leave.

    As prescribed in 637.110(c), insert the following clause:

    Observance of Legal Holidays and Administrative Leave (Dec 1994)

    (a) The Department of State observes the following days as holidays:

New Year's Day
Martin Luther King's Birthday
Presidents' Day

[[Page 562]]

Memorial Day
Independence Day
Labor Day
Columbus Day
Veterans Day
Thanksgiving Day
Christmas Day

Any other day designated by Federal law, Executive Order, or 
Presidential Proclamation.
    (b) When any such day falls on a Saturday, the preceding Friday is 
observed; when any such day falls on a Sunday, the following Monday is 
observed. Observance of such days by Government personnel shall not be 
cause for additional period of performance or entitlement to 
compensation except as set forth in the contract. If the contractor's 
personnel work on a holiday, no form of holiday or other premium 
compensation will be reimbursed either as a direct or indirect cost, 
unless authorized pursuant to an overtime clause elsewhere in this 
contract.
    (c) When the Department of State grants administrative leave to its 
Government employees, assigned contractor personnel in Government 
facilities shall also be dismissed. However, the contractor agrees to 
continue to provide sufficient personnel to perform round-the-clock 
requirements of critical tasks already in operation or scheduled, and 
shall be guided by the instructions issued by the contracting officer or 
his/her duly authorized representative.
    (d) For fixed-price contracts, if services are not required or 
provided because the building is closed due to inclement weather, 
unanticipated holidays declared by the President, failure of Congress to 
appropriate funds, or similar reasons, deductions will be computed as 
follows:
    (1) The deduction rate in dollars per day will be equal to the per 
month contract price divided by 21 days per month.
    (2) The deduction rate in dollars per day will be multiplied by the 
number of days services are not required or provided. If services are 
provided for portions of days, appropriate adjustment will be made by 
the contracting officer to ensure that the contractor is compensated for 
services provided.
    (e) If administrative leave is granted to contractor personnel as a 
result of conditions stipulated in any ``Excusable Delays'' clause of 
this contract, it will be without loss to the contractor. The cost of 
salaries and wages to the contractor for the period of any such excused 
absence shall be a reimbursable item of direct cost hereunder for 
employees whose regular time is normally charged, and a reimbursable 
item of indirect cost for employees whose time is normally charged 
indirectly in accordance with the contractor's accounting policy.

(End of clause)
[59 FR 66772, Dec. 28, 1994]



652.242-70  Contracting Officer's Representative (COR).

    As prescribed in 642.271, insert a clause substantially the same as 
follows:

          Contracting Officer's Representative (COR) (DEC 1994)

    (a) The Contracting Officer may designate in writing one or more 
Government employees, by name and position title, to take action for the 
Contracting Officer under this contract. Each designee shall be 
identified as a Contracting Officer's Representative (COR). Such 
designation(s) shall specify the scope and limitations of the authority 
so delegated; provided, that the designee shall not change the terms or 
conditions of the contract, unless the COR is a warranted Contracting 
Officer and this authority is delegated in the designation.
    (b) The COR is [insert name of COR].

                             (End of clause)

[53 FR 26177, July 11, 1988, as amended at 59 FR 66772, Dec. 28, 1994]



652.242-71  Notice of Shipments.

    As prescribed in 642.1406-2-70(a), insert the following clause in 
solicitations and contracts entered into and performed outside the 
United States, when overseas shipment of supplies is required.

                     Notice of Shipments (July 1988)

    At the time of delivery of supplies to a carrier for onward 
transportation, the Contractor shall give notice of prepaid shipment to 
the consignee establishment, and to such other persons as instructed by 
the Contracting Officer. If the Contractor has not received such 
instructions by 24 hours prior to the delivery time, the Contractor 
shall contact the Contracting Officer and request instructions from the 
Contracting Officer concerning the notice of shipment to be given.

                             (End of clause)



652.242-72  Shipping Instructions.

    As prescribed in 642.1406-2-70(b), insert the following clause in 
solicitations and contracts with a source in the United States and 
requiring overseas shipment of supplies.

                    Shipping Instructions (DEC 1994)

    (a) Each packing box shall be of solid construction in accordance 
with best commercial practices and sufficiently strong in direct ratio 
to the weight of the contents to

[[Page 563]]

withstand excessively rough handling while in transit overseas. It shall 
be constructed of lumber that is well seasoned, reasonably sound, free 
from bad cross grain and from knots or knotholes that interfere with 
nailing or that occupy more than \1/3\ of the width of the piece of 
lumber. Box shall be constructed with three-way corners and diagonal 
bracing. All nails shall be cement-coated, of correct size and properly 
spaced to avoid splitting or warping, and shall be driven into the grain 
of the wood. Dimension of lumber shall be in accordance with the 
following table, dependent upon the weight of the contents:

                                                                        
------------------------------------------------------------------------
                                        Minimum dimensions of lumber for
      Weight of box and contents           struts, frame members, and   
                                             single diagonal braces     
------------------------------------------------------------------------
Up to 45 kg...........................  19.05  x  57.15mm               
46 to 113 kg..........................  22.23  x  73.03mm               
114 to 181 kg.........................  22.23  x  98.43mm               
182 to 272 kg.........................  22.23  x  123.83mm or 25.4  x   
                                         98.43 mm                       
------------------------------------------------------------------------

    (b) Each box shall be lined with waterproof paper and shall be bound 
with 19.05mm' steel straps firmly stapled in position to prevent the 
straps from slipping off the box. Articles must be secured and braced 
inside the shipping container to prevent the articles from shifting.
    (c) Packing cases weighing 453.5kg and more must be equipped with 
skids. Each skid shall consist of two end sections of 50.8  x  152.4mm 
lumber placed flat and a center section of 50.8  x  101.6mm lumber 
placed flat and then arranged in line to provide 254mm forklift spaces 
between center and end sections. When goods are ready for shipment, the 
Contractor shall prepare four (4) copies of a packing list, indicating 
the contract and, if applicable, order numbers; case number; itemized 
list of contents; net and gross weights in kilograms; and outside 
dimensions, including all clears, of each shipping container. The 
Contractor shall provide three (3) copies of the packing list to the 
U.S. Despatch Agent as specified in the contract or order. The 
Contractor shall place the fourth copy of the packing list in packing 
case number one, which shall be marked as such so that it is easily 
identified by the consignee. Upon receipt of the packing list, the 
Despatch Agent will furnish export marks and instructions regarding 
shipment to the port specified, depending upon steamer services 
available at the time.
    (d) The export marks shall be stenciled on one side of each box 
reserved for that purpose, and the appropriate case number stenciled in 
the lower left-hand corner of the same side. The contract and, as 
necessary, order numbers, net and gross weights in kilograms shall be 
stenciled on the same side. However, if the size of the box is too small 
to accommodate all stenciling on one side, the contract and order 
numbers and weights may be stenciled on the side opposite that used for 
the export marks and case number.
    (e) The contract and, as necessary, order numbers must appear on all 
containers and papers relating to this clause.

                             (End of clause)

[53 FR 26177, July 11, 1988; 53 FR 36462, Sept. 20, 1988, as amended at 
59 FR 66772, Dec. 28, 1994]



652.246-70  Commercial Warranty.

    As prescribed in 646.710-70, insert the following clause in 
solicitations and contracts for commercial supplies or services awarded 
and performed outside the United States.

                     Commercial Warranty (July 1988)

    The Contractor agrees that the supplies or services furnished under 
this contract shall be covered by the most favorable commercial 
warranties the Contractor gives to any customer for such supplies or 
services. The rights and remedies provided herein are in addition to and 
to not limit any rights afforded to the Government by any other clause 
of this contract.

                             (End of clause)



PART 653--FORMS--Table of Contents




Sec.
653.000  Scope of part.

                         Subpart 653.1--General

653.101  Requirements for use of forms.
653.101-70  Policy.
653.110  Continuation sheets.

                  Subpart 653.2--Prescription of Forms

653.200  Scope of subpart.
653.213  Simplified acquisition procedures (SF's 18, 30, 44, 1165, OF's 
          347, 348).
653.213-70  DOS Forms (OF-206, OF-206A, OF-127, DST-1918, DST-1919, DST-
          1920).
653.217  Special contracting methods.
653.217-70  DOS form DS-1921, Award/Modification of Interagency 
          Acquisition Agreement.
653.219  Small business and small disadvantaged business concerns.
653.219-70  DOS form DS-1910, Small Business/Labor Surplus Area Review--
          Actions Above the Simplified Acquisition Threshold.

                  Subpart 653.3--Illustrations of Forms

653.300  Scope of subpart.
653.303  Agency forms.

[[Page 564]]

653.302  .127  Optional Form 127, Receiving and Inspection Report.
653.302  .206  Optional Form 206, Purchase Order, Receiving Report and 
          Voucher.
653.302  .206A  Optional Form 206A, Purchase Order, Receiving Report and 
          Voucher--Continuation Sheet.
653.303-  DST-1089  Department of State Form 1089, Order--Supplies or 
          Services.

    Authority:  40 U.S.C. 486(c); 22 U.S.C. 2658.

    Source:  53 FR 26180, July 11, 1988, unless otherwise noted.



653.000  Scope of part.

    This part prescribes DOSAR forms in addition to those provided in 
FAR Part 53.



                         Subpart 653.1--General



653.101  Requirements for use of forms.



653.101-70  Policy.

    The forms in FAR Subpart 53.2 or in Subpart 653.2 shall be used as 
precribed therein, except when the use of any form is prohibited by or 
inconsistent with local laws, or the supplies or services could not be 
obtained if the form were used. The contracting officer shall justify 
the exclusion of any form in accordance with FAR Subpart 1.4 and 
601.470.



653.110  Continuation sheets.

    The provisions of FAR 53.110 also apply to forms prescribed in the 
DOSAR.



                  Subpart 653.2--Prescription of Forms



653.200  Scope of subpart.

    This subpart prescribes or references optional and DOS forms for use 
in acquisition. Consistent with FAR 53.200, this subpart is arranged by 
subject matter, in the same order as and keyed to the parts of the DOSAR 
in which the form usage requirements are addressed.



653.213  Simplified acquisition procedures (SF's 18, 30, 44, 1165, OF's 347, 348).



653.213-70  DOS Forms (OF-206, OF-206A, OF-127, DST-1918, DST-1919, DST-1920).

    As provided in 613.505-2 and 613.505-70,the following forms are 
prescribed for use in simplified acquisitions, delivery orders, and 
blanket purchase agreements:
    (a) Optional Form (OF) 206, Purchase Order, Receiving Report and 
Voucher, and Optional Form (OF) 206A, Continuation Sheet. OF-206 and OF-
206A are prescribed for use by overseas contracting activities in lieu 
of the OF-347 and OF-348, as specified in 613.505-2(a).
    (b) Optional Form (OF) 127, Receiving and Inspection Report. OF/127 
is prescribed for use by overseas contracting activities as a receiving 
report when using the OF-206, as specified in 613.505-2(b). The OF-127 
may be used as a receiving report in conjunction with other contract 
forms (e.g., SF-26, SF-33) by both domestic and overseas contracting 
activities.
    (c) DST-1918, Purchase Order File. DST-1918 is prescribed for use in 
recording and documenting relevant data pertaining to open market 
simplified acquisitions, as specified in 613.505-70.
    (d) DST-1919, Deliver Order File. DST-1919 is prescribed for use in 
recording and documenting relevant data pertaining to delivery orders 
issued against GSA mandatory and nonmandatory schedule contracts, as 
well as Department of State and other agency contracts, as specified in 
613.505-70.
    (e) DST-1920, Blanket Purchase Agreement (BPA) File. DST-1920 is 
prescribed for use in recording and documenting relevant data pertaining 
to Blanket Purchase Agreements, as specified in 613.505-70.
[59 FR 66773, Dec. 28, 1994, as amended at 60 FR 39663, Aug. 3, 1995]



653.217  Special contracting methods.



653.217-70  DOS form DS-1921, Award/Modification of Interagency Acquisition Agreement.

    As prescribed in 617.504-70(b)(5)(i), DS-1921 is prescribed for use 
when awarding or modifying Economy Act

[[Page 565]]

Interagency Acquisition Agreements where the Department is the 
requesting agency.
[59 FR 66773, Dec. 28, 1994]



653.219  Small business and small disadvantaged business concerns.



653.219-70  DOS form DS-1910, Small Business/Labor Surplus Area Review--Actions Above the Simplified Acquisition Threshold.

    As prescribed in 619.501(c), DS-1910 is prescribed for use in 
documenting set-aside decisions.
[59 FR 66773, Dec. 28, 1994, as amended at 60 FR 39663, Aug. 3, 1995]



                  Subpart 653.3--Illustrations of Forms



653.300  Scope of subpart.

    This subpart contains illustrations of forms prescribed in the DOSAR 
but not illustrated in FAR Subpart 53.3.



653.303  Agency forms.

    This section illustrates the DOS forms that are specified by the 
DOSAR for use in acquisitions. The forms are illustrated in numerical 
order. The subsection numbers correspond with the DOS form numbers.

[[Page 566]]

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[GRAPHIC] [TIFF OMITTED] TC01MR91.135

[[Page 573]]


                              FINDING AIDS




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

  A list of CFR titles, subtitles, chapters, subchapters and parts and 
an alphabetical list of agencies publishing in the CFR are included in 
the CFR Index and Finding Aids volume to the Code of Federal Regulations 
which is published separately and revised annually.
  Table of CFR Titles and Chapters
  Alphabetical List of Agencies Appearing in the CFR
  List of CFR Sections Affected



[[Page 575]]



                    Table of CFR Titles and Chapters




                   (Revised as of September 30, 1997)

                      Title 1--General Provisions

         I  Administrative Committee of the Federal Register 
                (Parts 1--49)
        II  Office of the Federal Register (Parts 50--299)
        IV  Miscellaneous Agencies (Parts 400--500)

                          Title 2--[Reserved]

                        Title 3--The President

         I  Executive Office of the President (Parts 100--199)

                           Title 4--Accounts

         I  General Accounting Office (Parts 1--99)
        II  Federal Claims Collection Standards (General 
                Accounting Office--Department of Justice) (Parts 
                100--299)

                   Title 5--Administrative Personnel

         I  Office of Personnel Management (Parts 1--1199)
        II  Merit Systems Protection Board (Parts 1200--1299)
       III  Office of Management and Budget (Parts 1300--1399)
        IV  Advisory Committee on Federal Pay (Parts 1400--1499)
         V  The International Organizations Employees Loyalty 
                Board (Parts 1500--1599)
        VI  Federal Retirement Thrift Investment Board (Parts 
                1600--1699)
       VII  Advisory Commission on Intergovernmental Relations 
                (Parts 1700--1799)
      VIII  Office of Special Counsel (Parts 1800--1899)
        IX  Appalachian Regional Commission (Parts 1900--1999)
        XI  Armed Forces Retirement Home (Part 2100)
       XIV  Federal Labor Relations Authority, General Counsel of 
                the Federal Labor Relations Authority and Federal 
                Service Impasses Panel (Parts 2400--2499)
        XV  Office of Administration, Executive Office of the 
                President (Parts 2500--2599)
       XVI  Office of Government Ethics (Parts 2600--2699)
       XXI  Department of the Treasury (Parts 3100--3199)
      XXII  Federal Deposit Insurance Corporation (Part 3201)
     XXIII  Department of Energy (Part 3301)

[[Page 576]]

      XXIV  Federal Energy Regulatory Commission (Part 3401)
      XXVI  Department of Defense (Part 3601)
    XXVIII  Department of Justice (Part 3801)
      XXIX  Federal Communications Commission (Parts 3900--3999)
       XXX  Farm Credit System Insurance Corporation (Parts 4000--
                4099)
      XXXI  Farm Credit Administration (Parts 4100--4199)
    XXXIII  Overseas Private Investment Corporation (Part 4301)
      XXXV  Office of Personnel Management (Part 4501)
        XL  Interstate Commerce Commission (Part 5001)
       XLI  Commodity Futures Trading Commission (Part 5101)
      XLII  Department of Labor (Part 5201)
     XLIII  National Science Foundation (Part 5301)
       XLV  Department of Health and Human Services (Part 5501)
      XLVI  Postal Rate Commission (Part 5601)
     XLVII  Federal Trade Commission (Part 5701)
    XLVIII  Nuclear Regulatory Commission (Part 5801)
         L  Department of Transportation (Part 6001)
       LII  Export-Import Bank of the United States (Part 6201)
      LIII  Department of Education (Parts 6300--6399)
       LIV  Environmental Protection Agency (Part 6401)
      LVII  General Services Administration (Part 6701)
     LVIII  Board of Governors of the Federal Reserve System (Part 
                6801)
       LIX  National Aeronautics and Space Administration (Part 
                6901)
        LX  United States Postal Service (Part 7001)
       LXI  National Labor Relations Board (Part 7101)
      LXII  Equal Employment Opportunity Commission (Part 7201)
     LXIII  Inter-American Foundation (Part 7301)
       LXV  Department of Housing and Urban Development (Part 
                7501)
      LXVI  National Archives and Records Administration (Part 
                7601)
      LXIX  Tennessee Valley Authority (Part 7901)
      LXXI  Consumer Product Safety Commission (Part 8101)
     LXXIV  Federal Mine Safety and Health Review Commission (Part 
                8401)
     LXXVI  Federal Retirement Thrift Investment Board (Part 8601)
    LXXVII  Office of Management and Budget (Part 8701)

                          Title 6--[Reserved]

                         Title 7--Agriculture

            Subtitle A--Office of the Secretary of Agriculture 
                (Parts 0--26)
            Subtitle B--Regulations of the Department of 
                Agriculture
         I  Agricultural Marketing Service (Standards, 
                Inspections, Marketing Practices), Department of 
                Agriculture (Parts 27--209)
        II  Food and Consumer Service, Department of Agriculture 
                (Parts 210--299)

[[Page 577]]

       III  Animal and Plant Health Inspection Service, Department 
                of Agriculture (Parts 300--399)
        IV  Federal Crop Insurance Corporation, Department of 
                Agriculture (Parts 400--499)
         V  Agricultural Research Service, Department of 
                Agriculture (Parts 500--599)
        VI  Natural Resources Conservation Service, Department of 
                Agriculture (Parts 600--699)
       VII  Farm Service Agency, Department of Agriculture (Parts 
                700--799)
      VIII  Grain Inspection, Packers and Stockyards 
                Administration (Federal Grain Inspection Service), 
                Department of Agriculture (Parts 800--899)
        IX  Agricultural Marketing Service (Marketing Agreements 
                and Orders; Fruits, Vegetables, Nuts), Department 
                of Agriculture (Parts 900--999)
         X  Agricultural Marketing Service (Marketing Agreements 
                and Orders; Milk), Department of Agriculture 
                (Parts 1000--1199)
        XI  Agricultural Marketing Service (Marketing Agreements 
                and Orders; Miscellaneous Commodities), Department 
                of Agriculture (Parts 1200--1299)
      XIII  Northeast Dairy Compact Commission (Parts 1300--1399)
       XIV  Commodity Credit Corporation, Department of 
                Agriculture (Parts 1400--1499)
        XV  Foreign Agricultural Service, Department of 
                Agriculture (Parts 1500--1599)
       XVI  Rural Telephone Bank, Department of Agriculture (Parts 
                1600--1699)
      XVII  Rural Utilities Service, Department of Agriculture 
                (Parts 1700--1799)
     XVIII  Rural Housing Service, Rural Business-Cooperative 
                Service, Rural Utilities Service, and Farm Service 
                Agency, Department of Agriculture (Parts 1800--
                2099)
      XXVI  Office of Inspector General, Department of Agriculture 
                (Parts 2600--2699)
     XXVII  Office of Information Resources Management, Department 
                of Agriculture (Parts 2700--2799)
    XXVIII  Office of Operations, Department of Agriculture (Parts 
                2800--2899)
      XXIX  Office of Energy, Department of Agriculture (Parts 
                2900--2999)
       XXX  Office of the Chief Financial Officer, Department of 
                Agriculture (Parts 3000--3099)
      XXXI  Office of Environmental Quality, Department of 
                Agriculture (Parts 3100--3199)
     XXXII  [Reserved]
    XXXIII  Office of Transportation, Department of Agriculture 
                (Parts 3300--3399)
     XXXIV  Cooperative State Research, Education, and Extension 
                Service, Department of Agriculture (Parts 3400--
                3499)
      XXXV  Rural Housing Service, Department of Agriculture 
                (Parts 3500--3599)

[[Page 578]]

     XXXVI  National Agricultural Statistics Service, Department 
                of Agriculture (Parts 3600--3699)
    XXXVII  Economic Research Service, Department of Agriculture 
                (Parts 3700--3799)
   XXXVIII  World Agricultural Outlook Board, Department of 
                Agriculture (Parts 3800--3899)
       XLI  [Reserved]
      XLII  Rural Business-Cooperative Service and Rural Utilities 
                Service, Department of Agriculture (Parts 4200--
                4299)

                    Title 8--Aliens and Nationality

         I  Immigration and Naturalization Service, Department of 
                Justice (Parts 1--499)

                 Title 9--Animals and Animal Products

         I  Animal and Plant Health Inspection Service, Department 
                of Agriculture (Parts 1--199)
        II  Grain Inspection, Packers and Stockyards 
                Administration (Packers and Stockyards Programs), 
                Department of Agriculture (Parts 200--299)
       III  Food Safety and Inspection Service, Meat and Poultry 
                Inspection, Department of Agriculture (Parts 300--
                599)

                           Title 10--Energy

         I  Nuclear Regulatory Commission (Parts 0--199)
        II  Department of Energy (Parts 200--699)
       III  Department of Energy (Parts 700--999)
         X  Department of Energy (General Provisions) (Parts 
                1000--1099)
        XI  United States Enrichment Corporation (Parts 1100--
                1199)
        XV  Office of the Federal Inspector for the Alaska Natural 
                Gas Transportation System (Parts 1500--1599)
      XVII  Defense Nuclear Facilities Safety Board (Parts 1700--
                1799)

                      Title 11--Federal Elections

         I  Federal Election Commission (Parts 1--9099)

                      Title 12--Banks and Banking

         I  Comptroller of the Currency, Department of the 
                Treasury (Parts 1--199)
        II  Federal Reserve System (Parts 200--299)
       III  Federal Deposit Insurance Corporation (Parts 300--399)
        IV  Export-Import Bank of the United States (Parts 400--
                499)
         V  Office of Thrift Supervision, Department of the 
                Treasury (Parts 500--599)
        VI  Farm Credit Administration (Parts 600--699)
       VII  National Credit Union Administration (Parts 700--799)

[[Page 579]]

      VIII  Federal Financing Bank (Parts 800--899)
        IX  Federal Housing Finance Board (Parts 900--999)
        XI  Federal Financial Institutions Examination Council 
                (Parts 1100--1199)
       XIV  Farm Credit System Insurance Corporation (Parts 1400--
                1499)
        XV  Thrift Depositor Protection Oversight Board (Parts 
                1500--1599)
      XVII  Office of Federal Housing Enterprise Oversight, 
                Department of Housing and Urban Development (Parts 
                1700-1799)
     XVIII  Community Development Financial Institutions Fund, 
                Department of the Treasury (Parts 1800--1899)

               Title 13--Business Credit and Assistance

         I  Small Business Administration (Parts 1--199)
       III  Economic Development Administration, Department of 
                Commerce (Parts 300--399)

                    Title 14--Aeronautics and Space

         I  Federal Aviation Administration, Department of 
                Transportation (Parts 1--199)
        II  Office of the Secretary, Department of Transportation 
                (Aviation Proceedings) (Parts 200--399)
       III  Commercial Space Transportation, Federal Aviation 
                Administration, Department of Transportation 
                (Parts 400--499)
         V  National Aeronautics and Space Administration (Parts 
                1200--1299)

                 Title 15--Commerce and Foreign Trade

            Subtitle A--Office of the Secretary of Commerce (Parts 
                0--29)
            Subtitle B--Regulations Relating to Commerce and 
                Foreign Trade
         I  Bureau of the Census, Department of Commerce (Parts 
                30--199)
        II  National Institute of Standards and Technology, 
                Department of Commerce (Parts 200--299)
       III  International Trade Administration, Department of 
                Commerce (Parts 300--399)
        IV  Foreign-Trade Zones Board, Department of Commerce 
                (Parts 400--499)
       VII  Bureau of Export Administration, Department of 
                Commerce (Parts 700--799)
      VIII  Bureau of Economic Analysis, Department of Commerce 
                (Parts 800--899)
        IX  National Oceanic and Atmospheric Administration, 
                Department of Commerce (Parts 900--999)
        XI  Technology Administration, Department of Commerce 
                (Parts 1100--1199)
      XIII  East-West Foreign Trade Board (Parts 1300--1399)
       XIV  Minority Business Development Agency (Parts 1400--
                1499)

[[Page 580]]

            Subtitle C--Regulations Relating to Foreign Trade 
                Agreements
        XX  Office of the United States Trade Representative 
                (Parts 2000--2099)
            Subtitle D--Regulations Relating to Telecommunications 
                and Information
     XXIII  National Telecommunications and Information 
                Administration, Department of Commerce (Parts 
                2300--2399)

                    Title 16--Commercial Practices

         I  Federal Trade Commission (Parts 0--999)
        II  Consumer Product Safety Commission (Parts 1000--1799)

             Title 17--Commodity and Securities Exchanges

         I  Commodity Futures Trading Commission (Parts 1--199)
        II  Securities and Exchange Commission (Parts 200--399)
        IV  Department of the Treasury (Parts 400--499)

          Title 18--Conservation of Power and Water Resources

         I  Federal Energy Regulatory Commission, Department of 
                Energy (Parts 1--399)
       III  Delaware River Basin Commission (Parts 400--499)
        VI  Water Resources Council (Parts 700--799)
      VIII  Susquehanna River Basin Commission (Parts 800--899)
      XIII  Tennessee Valley Authority (Parts 1300--1399)

                       Title 19--Customs Duties

         I  United States Customs Service, Department of the 
                Treasury (Parts 1--199)
        II  United States International Trade Commission (Parts 
                200--299)
       III  International Trade Administration, Department of 
                Commerce (Parts 300--399)

                     Title 20--Employees' Benefits

         I  Office of Workers' Compensation Programs, Department 
                of Labor (Parts 1--199)
        II  Railroad Retirement Board (Parts 200--399)
       III  Social Security Administration (Parts 400--499)
        IV  Employees' Compensation Appeals Board, Department of 
                Labor (Parts 500--599)
         V  Employment and Training Administration, Department of 
                Labor (Parts 600--699)
        VI  Employment Standards Administration, Department of 
                Labor (Parts 700--799)
       VII  Benefits Review Board, Department of Labor (Parts 
                800--899)
      VIII  Joint Board for the Enrollment of Actuaries (Parts 
                900--999)

[[Page 581]]

        IX  Office of the Assistant Secretary for Veterans' 
                Employment and Training, Department of Labor 
                (Parts 1000--1099)

                       Title 21--Food and Drugs

         I  Food and Drug Administration, Department of Health and 
                Human Services (Parts 1--1299)
        II  Drug Enforcement Administration, Department of Justice 
                (Parts 1300--1399)
       III  Office of National Drug Control Policy (Parts 1400--
                1499)

                      Title 22--Foreign Relations

         I  Department of State (Parts 1--199)
        II  Agency for International Development, International 
                Development Cooperation Agency (Parts 200--299)
       III  Peace Corps (Parts 300--399)
        IV  International Joint Commission, United States and 
                Canada (Parts 400--499)
         V  United States Information Agency (Parts 500--599)
        VI  United States Arms Control and Disarmament Agency 
                (Parts 600--699)
       VII  Overseas Private Investment Corporation, International 
                Development Cooperation Agency (Parts 700--799)
        IX  Foreign Service Grievance Board Regulations (Parts 
                900--999)
         X  Inter-American Foundation (Parts 1000--1099)
        XI  International Boundary and Water Commission, United 
                States and Mexico, United States Section (Parts 
                1100--1199)
       XII  United States International Development Cooperation 
                Agency (Parts 1200--1299)
      XIII  Board for International Broadcasting (Parts 1300--
                1399)
       XIV  Foreign Service Labor Relations Board; Federal Labor 
                Relations Authority; General Counsel of the 
                Federal Labor Relations Authority; and the Foreign 
                Service Impasse Disputes Panel (Parts 1400--1499)
        XV  African Development Foundation (Parts 1500--1599)
       XVI  Japan-United States Friendship Commission (Parts 
                1600--1699)
      XVII  United States Institute of Peace (Parts 1700--1799)

                          Title 23--Highways

         I  Federal Highway Administration, Department of 
                Transportation (Parts 1--999)
        II  National Highway Traffic Safety Administration and 
                Federal Highway Administration, Department of 
                Transportation (Parts 1200--1299)
       III  National Highway Traffic Safety Administration, 
                Department of Transportation (Parts 1300--1399)

[[Page 582]]

                Title 24--Housing and Urban Development

            Subtitle A--Office of the Secretary, Department of 
                Housing and Urban Development (Parts 0--99)
            Subtitle B--Regulations Relating to Housing and Urban 
                Development
         I  Office of Assistant Secretary for Equal Opportunity, 
                Department of Housing and Urban Development (Parts 
                100--199)
        II  Office of Assistant Secretary for Housing-Federal 
                Housing Commissioner, Department of Housing and 
                Urban Development (Parts 200--299)
       III  Government National Mortgage Association, Department 
                of Housing and Urban Development (Parts 300--399)
         V  Office of Assistant Secretary for Community Planning 
                and Development, Department of Housing and Urban 
                Development (Parts 500--599)
        VI  Office of Assistant Secretary for Community Planning 
                and Development, Department of Housing and Urban 
                Development (Parts 600--699) [Reserved]
       VII  Office of the Secretary, Department of Housing and 
                Urban Development (Housing Assistance Programs and 
                Public and Indian Housing Programs) (Parts 700--
                799)
      VIII  Office of the Assistant Secretary for Housing--Federal 
                Housing Commissioner, Department of Housing and 
                Urban Development (Section 8 Housing Assistance 
                Programs and Section 202 Direct Loan Program) 
                (Parts 800--899)
        IX  Office of Assistant Secretary for Public and Indian 
                Housing, Department of Housing and Urban 
                Development (Parts 900--999)
         X  Office of Assistant Secretary for Housing--Federal 
                Housing Commissioner, Department of Housing and 
                Urban Development (Interstate Land Sales 
                Registration Program) (Parts 1700--1799)
       XII  Office of Inspector General, Department of Housing and 
                Urban Development (Parts 2000--2099)
        XX  Office of Assistant Secretary for Housing--Federal 
                Housing Commissioner, Department of Housing and 
                Urban Development (Parts 3200--3899)
       XXV  Neighborhood Reinvestment Corporation (Parts 4100--
                4199)

                           Title 25--Indians

         I  Bureau of Indian Affairs, Department of the Interior 
                (Parts 1--299)
        II  Indian Arts and Crafts Board, Department of the 
                Interior (Parts 300--399)
       III  National Indian Gaming Commission, Department of the 
                Interior (Parts 500--599)
        IV  Office of Navajo and Hopi Indian Relocation (Parts 
                700--799)
         V  Bureau of Indian Affairs, Department of the Interior, 
                and Indian Health Service, Department of Health 
                and Human Services (Part 900)
        VI  Office of the Assistant Secretary-Indian Affairs, 
                Department of the Interior (Part 1001)

[[Page 583]]

       VII  Office of the Special Trustee for American Indians, 
                Department of the Interior (Part 1200)

                      Title 26--Internal Revenue

         I  Internal Revenue Service, Department of the Treasury 
                (Parts 1--799)

           Title 27--Alcohol, Tobacco Products and Firearms

         I  Bureau of Alcohol, Tobacco and Firearms, Department of 
                the Treasury (Parts 1--299)

                   Title 28--Judicial Administration

         I  Department of Justice (Parts 0--199)
       III  Federal Prison Industries, Inc., Department of Justice 
                (Parts 300--399)
         V  Bureau of Prisons, Department of Justice (Parts 500--
                599)
        VI  Offices of Independent Counsel, Department of Justice 
                (Parts 600--699)
       VII  Office of Independent Counsel (Parts 700--799)

                            Title 29--Labor

            Subtitle A--Office of the Secretary of Labor (Parts 
                0--99)
            Subtitle B--Regulations Relating to Labor
         I  National Labor Relations Board (Parts 100--199)
        II  Office of Labor-Management Standards, Department of 
                Labor (Parts 200--299)
       III  National Railroad Adjustment Board (Parts 300--399)
        IV  Office of Labor-Management Standards, Department of 
                Labor (Parts 400--499)
         V  Wage and Hour Division, Department of Labor (Parts 
                500--899)
        IX  Construction Industry Collective Bargaining Commission 
                (Parts 900--999)
         X  National Mediation Board (Parts 1200--1299)
       XII  Federal Mediation and Conciliation Service (Parts 
                1400--1499)
       XIV  Equal Employment Opportunity Commission (Parts 1600--
                1699)
      XVII  Occupational Safety and Health Administration, 
                Department of Labor (Parts 1900--1999)
        XX  Occupational Safety and Health Review Commission 
                (Parts 2200--2499)
       XXV  Pension and Welfare Benefits Administration, 
                Department of Labor (Parts 2500--2599)
     XXVII  Federal Mine Safety and Health Review Commission 
                (Parts 2700--2799)
        XL  Pension Benefit Guaranty Corporation (Parts 4000--
                4999)

[[Page 584]]

                      Title 30--Mineral Resources

         I  Mine Safety and Health Administration, Department of 
                Labor (Parts 1--199)
        II  Minerals Management Service, Department of the 
                Interior (Parts 200--299)
       III  Board of Surface Mining and Reclamation Appeals, 
                Department of the Interior (Parts 300--399)
        IV  Geological Survey, Department of the Interior (Parts 
                400--499)
        VI  Bureau of Mines, Department of the Interior (Parts 
                600--699)
       VII  Office of Surface Mining Reclamation and Enforcement, 
                Department of the Interior (Parts 700--999)

                 Title 31--Money and Finance: Treasury

            Subtitle A--Office of the Secretary of the Treasury 
                (Parts 0--50)
            Subtitle B--Regulations Relating to Money and Finance
         I  Monetary Offices, Department of the Treasury (Parts 
                51--199)
        II  Fiscal Service, Department of the Treasury (Parts 
                200--399)
        IV  Secret Service, Department of the Treasury (Parts 
                400--499)
         V  Office of Foreign Assets Control, Department of the 
                Treasury (Parts 500--599)
        VI  Bureau of Engraving and Printing, Department of the 
                Treasury (Parts 600--699)
       VII  Federal Law Enforcement Training Center, Department of 
                the Treasury (Parts 700--799)
      VIII  Office of International Investment, Department of the 
                Treasury (Parts 800--899)

                      Title 32--National Defense

            Subtitle A--Department of Defense
         I  Office of the Secretary of Defense (Parts 1--399)
         V  Department of the Army (Parts 400--699)
        VI  Department of the Navy (Parts 700--799)
       VII  Department of the Air Force (Parts 800--1099)
            Subtitle B--Other Regulations Relating to National 
                Defense
       XII  Defense Logistics Agency (Parts 1200--1299)
       XVI  Selective Service System (Parts 1600--1699)
       XIX  Central Intelligence Agency (Parts 1900--1999)
        XX  Information Security Oversight Office, National 
                Archives and Records Administration (Parts 2000--
                2099)
       XXI  National Security Council (Parts 2100--2199)
      XXIV  Office of Science and Technology Policy (Parts 2400--
                2499)
     XXVII  Office for Micronesian Status Negotiations (Parts 
                2700--2799)
    XXVIII  Office of the Vice President of the United States 
                (Parts 2800--2899)
      XXIX  Presidential Commission on the Assignment of Women in 
                the Armed Forces (Part 2900)

[[Page 585]]

               Title 33--Navigation and Navigable Waters

         I  Coast Guard, Department of Transportation (Parts 1--
                199)
        II  Corps of Engineers, Department of the Army (Parts 
                200--399)
        IV  Saint Lawrence Seaway Development Corporation, 
                Department of Transportation (Parts 400--499)

                          Title 34--Education

            Subtitle A--Office of the Secretary, Department of 
                Education (Parts 1--99)
            Subtitle B--Regulations of the Offices of the 
                Department of Education
         I  Office for Civil Rights, Department of Education 
                (Parts 100--199)
        II  Office of Elementary and Secondary Education, 
                Department of Education (Parts 200--299)
       III  Office of Special Education and Rehabilitative 
                Services, Department of Education (Parts 300--399)
        IV  Office of Vocational and Adult Education, Department 
                of Education (Parts 400--499)
         V  Office of Bilingual Education and Minority Languages 
                Affairs, Department of Education (Parts 500--599)
        VI  Office of Postsecondary Education, Department of 
                Education (Parts 600--699)
       VII  Office of Educational Research and Improvement, 
                Department of Education (Parts 700--799)
        XI  National Institute for Literacy (Parts 1100-1199)
            Subtitle C--Regulations Relating to Education
       XII  National Council on Disability (Parts 1200--1299)

                        Title 35--Panama Canal

         I  Panama Canal Regulations (Parts 1--299)

             Title 36--Parks, Forests, and Public Property

         I  National Park Service, Department of the Interior 
                (Parts 1--199)
        II  Forest Service, Department of Agriculture (Parts 200--
                299)
       III  Corps of Engineers, Department of the Army (Parts 
                300--399)
        IV  American Battle Monuments Commission (Parts 400--499)
         V  Smithsonian Institution (Parts 500--599)
       VII  Library of Congress (Parts 700--799)
      VIII  Advisory Council on Historic Preservation (Parts 800--
                899)
        IX  Pennsylvania Avenue Development Corporation (Parts 
                900--999)
        XI  Architectural and Transportation Barriers Compliance 
                Board (Parts 1100--1199)
       XII  National Archives and Records Administration (Parts 
                1200--1299)
       XIV  Assassination Records Review Board (Parts 1400-1499)

[[Page 586]]

             Title 37--Patents, Trademarks, and Copyrights

         I  Patent and Trademark Office, Department of Commerce 
                (Parts 1--199)
        II  Copyright Office, Library of Congress (Parts 200--299)
        IV  Assistant Secretary for Technology Policy, Department 
                of Commerce (Parts 400--499)
         V  Under Secretary for Technology, Department of Commerce 
                (Parts 500--599)

           Title 38--Pensions, Bonuses, and Veterans' Relief

         I  Department of Veterans Affairs (Parts 0--99)

                       Title 39--Postal Service

         I  United States Postal Service (Parts 1--999)
       III  Postal Rate Commission (Parts 3000--3099)

                  Title 40--Protection of Environment

         I  Environmental Protection Agency (Parts 1--799)
         V  Council on Environmental Quality (Parts 1500--1599)

          Title 41--Public Contracts and Property Management

            Subtitle B--Other Provisions Relating to Public 
                Contracts
        50  Public Contracts, Department of Labor (Parts 50-1--50-
                999)
        51  Committee for Purchase From People Who Are Blind or 
                Severely Disabled (Parts 51-1--51-99)
        60  Office of Federal Contract Compliance Programs, Equal 
                Employment Opportunity, Department of Labor (Parts 
                60-1--60-999)
        61  Office of the Assistant Secretary for Veterans 
                Employment and Training, Department of Labor 
                (Parts 61-1--61-999)
            Subtitle C--Federal Property Management Regulations 
                System
       101  Federal Property Management Regulations (Parts 101-1--
                101-99)
       105  General Services Administration (Parts 105-1--105-999)
       109  Department of Energy Property Management Regulations 
                (Parts 109-1--109-99)
       114  Department of the Interior (Parts 114-1--114-99)
       115  Environmental Protection Agency (Parts 115-1--115-99)
       128  Department of Justice (Parts 128-1--128-99)
            Subtitle D--Other Provisions Relating to Property 
                Management [Reserved]
            Subtitle E--Federal Information Resources Management 
                Regulations System
       201  Federal Information Resources Management Regulation 
                (Parts 201-1--201-99) [Reserved]
            Subtitle F--Federal Travel Regulation System
       301  Travel Allowances (Parts 301-1--301-99)
       302  Relocation Allowances (Parts 302-1--302-99)

[[Page 587]]

       303  Payment of Expenses Connected with the Death of 
                Certain Employees (Parts 303-1--303-2)
       304  Payment from a Non-Federal Source for Travel Expenses 
                (Parts 304-1--304-99)

                        Title 42--Public Health

         I  Public Health Service, Department of Health and Human 
                Services (Parts 1--199)
        IV  Health Care Financing Administration, Department of 
                Health and Human Services (Parts 400--499)
         V  Office of Inspector General-Health Care, Department of 
                Health and Human Services (Parts 1000--1999)

                   Title 43--Public Lands: Interior

            Subtitle A--Office of the Secretary of the Interior 
                (Parts 1--199)
            Subtitle B--Regulations Relating to Public Lands
         I  Bureau of Reclamation, Department of the Interior 
                (Parts 200--499)
        II  Bureau of Land Management, Department of the Interior 
                (Parts 1000--9999)
       III  Utah Reclamation Mitigation and Conservation 
                Commission (Parts 10000--10005)

             Title 44--Emergency Management and Assistance

         I  Federal Emergency Management Agency (Parts 0--399)
        IV  Department of Commerce and Department of 
                Transportation (Parts 400--499)

                       Title 45--Public Welfare

            Subtitle A--Department of Health and Human Services 
                (Parts 1--199)
            Subtitle B--Regulations Relating to Public Welfare
        II  Office of Family Assistance (Assistance Programs), 
                Administration for Children and Families, 
                Department of Health and Human Services (Parts 
                200--299)
       III  Office of Child Support Enforcement (Child Support 
                Enforcement Program), Administration for Children 
                and Families, Department of Health and Human 
                Services (Parts 300--399)
        IV  Office of Refugee Resettlement, Administration for 
                Children and Families Department of Health and 
                Human Services (Parts 400--499)
         V  Foreign Claims Settlement Commission of the United 
                States, Department of Justice (Parts 500--599)
        VI  National Science Foundation (Parts 600--699)
       VII  Commission on Civil Rights (Parts 700--799)
      VIII  Office of Personnel Management (Parts 800--899)

[[Page 588]]

         X  Office of Community Services, Administration for 
                Children and Families, Department of Health and 
                Human Services (Parts 1000--1099)
        XI  National Foundation on the Arts and the Humanities 
                (Parts 1100--1199)
       XII  ACTION (Parts 1200--1299)
      XIII  Office of Human Development Services, Department of 
                Health and Human Services (Parts 1300--1399)
       XVI  Legal Services Corporation (Parts 1600--1699)
      XVII  National Commission on Libraries and Information 
                Science (Parts 1700--1799)
     XVIII  Harry S. Truman Scholarship Foundation (Parts 1800--
                1899)
       XXI  Commission on Fine Arts (Parts 2100--2199)
      XXII  Christopher Columbus Quincentenary Jubilee Commission 
                (Parts 2200--2299)
     XXIII  Arctic Research Commission (Part 2301)
      XXIV  James Madison Memorial Fellowship Foundation (Parts 
                2400--2499)
       XXV  Corporation for National and Community Service (Parts 
                2500--2599)

                          Title 46--Shipping

         I  Coast Guard, Department of Transportation (Parts 1--
                199)
        II  Maritime Administration, Department of Transportation 
                (Parts 200--399)
        IV  Federal Maritime Commission (Parts 500--599)

                      Title 47--Telecommunication

         I  Federal Communications Commission (Parts 0--199)
        II  Office of Science and Technology Policy and National 
                Security Council (Parts 200--299)
       III  National Telecommunications and Information 
                Administration, Department of Commerce (Parts 
                300--399)

           Title 48--Federal Acquisition Regulations System

         1  Federal Acquisition Regulation (Parts 1--99)
         2  Department of Defense (Parts 200--299)
         3  Department of Health and Human Services (Parts 300--
                399)
         4  Department of Agriculture (Parts 400--499)
         5  General Services Administration (Parts 500--599)
         6  Department of State (Parts 600--699)
         7  United States Agency for International Development 
                (Parts 700--799)
         8  Department of Veterans Affairs (Parts 800--899)
         9  Department of Energy (Parts 900--999)
        10  Department of the Treasury (Parts 1000--1099)

[[Page 589]]

        12  Department of Transportation (Parts 1200--1299)
        13  Department of Commerce (Parts 1300--1399)
        14  Department of the Interior (Parts 1400--1499)
        15  Environmental Protection Agency (Parts 1500--1599)
        16  Office of Personnel Management Federal Employees 
                Health Benefits Acquisition Regulation (Parts 
                1600--1699)
        17  Office of Personnel Management (Parts 1700--1799)
        18  National Aeronautics and Space Administration (Parts 
                1800--1899)
        19  United States Information Agency (Parts 1900--1999)
        20  Nuclear Regulatory Commission (Parts 2000--2099)
        21  Office of Personnel Management, Federal Employees 
                Group Life Insurance Federal Acquisition 
                Regulation (Parts 2100--2199)
        23  Social Security Administration (Parts 2300--2399)
        24  Department of Housing and Urban Development (Parts 
                2400--2499)
        25  National Science Foundation (Parts 2500--2599)
        28  Department of Justice (Parts 2800--2899)
        29  Department of Labor (Parts 2900--2999)
        34  Department of Education Acquisition Regulation (Parts 
                3400--3499)
        35  Panama Canal Commission (Parts 3500--3599)
        44  Federal Emergency Management Agency (Parts 4400--4499)
        51  Department of the Army Acquisition Regulations (Parts 
                5100--5199)
        52  Department of the Navy Acquisition Regulations (Parts 
                5200--5299)
        53  Department of the Air Force Federal Acquisition 
                Regulation Supplement (Parts 5300--5399)
        54  Defense Logistics Agency, Department of Defense (Part 
                5452)
        57  African Development Foundation (Parts 5700--5799)
        61  General Services Administration Board of Contract 
                Appeals (Parts 6100--6199)
        63  Department of Transportation Board of Contract Appeals 
                (Parts 6300--6399)
        99  Cost Accounting Standards Board, Office of Federal 
                Procurement Policy, Office of Management and 
                Budget (Parts 9900--9999)

                       Title 49--Transportation

            Subtitle A--Office of the Secretary of Transportation 
                (Parts 1--99)
            Subtitle B--Other Regulations Relating to 
                Transportation
         I  Research and Special Programs Administration, 
                Department of Transportation (Parts 100--199)
        II  Federal Railroad Administration, Department of 
                Transportation (Parts 200--299)

[[Page 590]]

       III  Federal Highway Administration, Department of 
                Transportation (Parts 300--399)
        IV  Coast Guard, Department of Transportation (Parts 400--
                499)
         V  National Highway Traffic Safety Administration, 
                Department of Transportation (Parts 500--599)
        VI  Federal Transit Administration, Department of 
                Transportation (Parts 600--699)
       VII  National Railroad Passenger Corporation (AMTRAK) 
                (Parts 700--799)
      VIII  National Transportation Safety Board (Parts 800--999)
         X  Surface Transportation Board, Department of 
                Transportation (Parts 1000--1399)

                   Title 50--Wildlife and Fisheries

         I  United States Fish and Wildlife Service, Department of 
                the Interior (Parts 1--199)
        II  National Marine Fisheries Service, National Oceanic 
                and Atmospheric Administration, Department of 
                Commerce (Parts 200--299)
       III  International Fishing and Related Activities (Parts 
                300--399)
        IV  Joint Regulations (United States Fish and Wildlife 
                Service, Department of the Interior and National 
                Marine Fisheries Service, National Oceanic and 
                Atmospheric Administration, Department of 
                Commerce); Endangered Species Committee 
                Regulations (Parts 400--499)
         V  Marine Mammal Commission (Parts 500--599)
        VI  Fishery Conservation and Management, National Oceanic 
                and Atmospheric Administration, Department of 
                Commerce (Parts 600--699)

                      CFR Index and Finding Aids

            Subject/Agency Index
            List of Agency Prepared Indexes
            Parallel Tables of Statutory Authorities and Rules
            Acts Requiring Publication in the Federal Register
            List of CFR Titles, Chapters, Subchapters, and Parts
            Alphabetical List of Agencies Appearing in the CFR



[[Page 591]]





           Alphabetical List of Agencies Appearing in the CFR




                   (Revised as of September 30, 1997)

                                                  CFR Title, Subtitle or 
                     Agency                               Chapter

ACTION                                            45, XII
Administrative Committee of the Federal Register  1, I
Advanced Research Projects Agency                 32, I
Advisory Commission on Intergovernmental          5, VII
     Relations
Advisory Committee on Federal Pay                 5, IV
Advisory Council on Historic Preservation         36, VIII
African Development Foundation                    22, XV
  Federal Acquisition Regulation                  48, 57
Agency for International Development, United      22, II
     States
  Federal Acquisition Regulation                  48, 7
Agricultural Marketing Service                    7, I, IX, X, XI
Agricultural Research Service                     7, V
Agriculture Department
  Agricultural Marketing Service                  7, I, IX, X, XI
  Agricultural Research Service                   7, V
  Animal and Plant Health Inspection Service      7, III; 9, I
  Chief Financial Officer, Office of              7, XXX
  Commodity Credit Corporation                    7, XIV
  Cooperative State Research, Education, and      7, XXXIV
       Extension Service
  Economic Research Service                       7, XXXVII
  Energy, Office of                               7, XXIX
  Environmental Quality, Office of                7, XXXI
  Farm Service Agency                             7, VII, XVIII
  Federal Acquisition Regulation                  48, 4
  Federal Crop Insurance Corporation              7, IV
  Food and Consumer Service                       7, II
  Food Safety and Inspection Service              9, III
  Foreign Agricultural Service                    7, XV
  Forest Service                                  36, II
  Grain Inspection, Packers and Stockyards        7, VIII; 9, II
       Administration
  Information Resources Management, Office of     7, XXVII
  Inspector General, Office of                    7, XXVI
  National Agricultural Library                   7, XLI
  National Agricultural Statistics Service        7, XXXVI
  Natural Resources Conservation Service          7, VI
  Operations, Office of                           7, XXVIII
  Rural Business-Cooperative Service              7, XVIII, XLII
  Rural Development Administration                7, XLII
  Rural Housing Service                           7, XVIII, XXXV
  Rural Telephone Bank                            7, XVI
  Rural Utilities Service                         7, XVII, XVIII, XLII
  Secretary of Agriculture, Office of             7, Subtitle A
  Transportation, Office of                       7, XXXIII
  World Agricultural Outlook Board                7, XXXVIII
Air Force Department                              32, VII
  Federal Acquisition Regulation Supplement       48, 53
Alaska Natural Gas Transportation System, Office  10, XV
     of the Federal Inspector
Alcohol, Tobacco and Firearms, Bureau of          27, I
AMTRAK                                            49, VII
American Battle Monuments Commission              36, IV
American Indians, Office of the Special Trustee   25, VII

[[Page 592]]

Animal and Plant Health Inspection Service        7, III; 9, I
Appalachian Regional Commission                   5, IX
Architectural and Transportation Barriers         36, XI
     Compliance Board
Arctic Research Commission                        45, XXIII
Armed Forces Retirement Home                      5, XI
Arms Control and Disarmament Agency, United       22, VI
     States
Army Department                                   32, V
  Engineers, Corps of                             33, II; 36, III
  Federal Acquisition Regulation                  48, 51
Assassination Records Review Board                36, XIV
Benefits Review Board                             20, VII
Bilingual Education and Minority Languages        34, V
     Affairs, Office of
Blind or Severely Disabled, Committee for         41, 51
     Purchase From People Who Are
Board for International Broadcasting              22, XIII
Census Bureau                                     15, I
Central Intelligence Agency                       32, XIX
Chief Financial Officer, Office of                7, XXX
Child Support Enforcement, Office of              45, III
Children and Families, Administration for         45, II, III, IV, X
Christopher Columbus Quincentenary Jubilee        45, XXII
     Commission
Civil Rights, Commission on                       45, VII
Civil Rights, Office for                          34, I
Coast Guard                                       33, I; 46, I; 49, IV
Commerce Department                               44, IV
  Census Bureau                                   15, I`
  Economic Affairs, Under Secretary               37, V
  Economic Analysis, Bureau of                    15, VIII
  Economic Development Administration             13, III
  Emergency Management and Assistance             44, IV
  Export Administration, Bureau of                15, VII
  Federal Acquisition Regulation                  48, 13
  Fishery Conservation and Management             50, VI
  Foreign-Trade Zones Board                       15, IV
  International Trade Administration              15, III; 19, III
  National Institute of Standards and Technology  15, II
  National Marine Fisheries Service               50, II, IV
  National Oceanic and Atmospheric                15, IX; 50, II, III, IV, 
       Administration                             VI
  National Telecommunications and Information     15, XXIII; 47, III
       Administration
  National Weather Service                        15, IX
  Patent and Trademark Office                     37, I
  Productivity, Technology and Innovation,        37, IV
       Assistant Secretary for
  Secretary of Commerce, Office of                15, Subtitle A
  Technology, Under Secretary for                 37, V
  Technology Administration                       15, XI
  Technology Policy, Assistant Secretary for      37, IV
Commercial Space Transportation                   14, III
Commodity Credit Corporation                      7, XIV
Commodity Futures Trading Commission              5, XLI; 17, I
Community Planning and Development, Office of     24, V, VI
     Assistant Secretary for
Community Services, Office of                     45, X
Comptroller of the Currency                       12, I
Construction Industry Collective Bargaining       29, IX
     Commission
Consumer Product Safety Commission                5, LXXI; 16, II
Cooperative State Research, Education, and        7, XXXIV
     Extension Service
Copyright Office                                  37, II
Cost Accounting Standards Board                   48, 99
Council on Environmental Quality                  40, V
Customs Service, United States                    19, I
Defense Contract Audit Agency                     32, I
Defense Department                                5, XXVI; 32, Subtitle A
  Advanced Research Projects Agency               32, I
  Air Force Department                            32, VII

[[Page 593]]

  Army Department                                 32, V; 33, II; 36, III, 
                                                  48, 51
  Defense Intelligence Agency                     32, I
  Defense Logistics Agency                        32, I, XII; 48, 54
  Defense Mapping Agency                          32, I
  Engineers, Corps of                             33, II; 36, III
  Federal Acquisition Regulation                  48, 2
  Navy Department                                 32, VI; 48, 52
  Secretary of Defense, Office of                 32, I
Defense Contract Audit Agency                     32, I
Defense Intelligence Agency                       32, I
Defense Logistics Agency                          32, XII; 48, 54
Defense Mapping Agency                            32, I
Defense Nuclear Facilities Safety Board           10, XVII
Delaware River Basin Commission                   18, III
Drug Enforcement Administration                   21, II
East-West Foreign Trade Board                     15, XIII
Economic Affairs, Under Secretary                 37, V
Economic Analysis, Bureau of                      15, VIII
Economic Development Administration               13, III
Economic Research Service                         7, XXXVII
Education, Department of                          5, LIII
  Bilingual Education and Minority Languages      34, V
       Affairs, Office of
  Civil Rights, Office for                        34, I
  Educational Research and Improvement, Office    34, VII
       of
  Elementary and Secondary Education, Office of   34, II
  Federal Acquisition Regulation                  48, 34
  Postsecondary Education, Office of              34, VI
  Secretary of Education, Office of               34, Subtitle A
  Special Education and Rehabilitative Services,  34, III
       Office of
  Vocational and Adult Education, Office of       34, IV
Educational Research and Improvement, Office of   34, VII
Elementary and Secondary Education, Office of     34, II
Employees' Compensation Appeals Board             20, IV
Employees Loyalty Board                           5, V
Employment and Training Administration            20, V
Employment Standards Administration               20, VI
Endangered Species Committee                      50, IV
Energy, Department of                             5, XXIII; 10, II, III, X
  Federal Acquisition Regulation                  48, 9
  Federal Energy Regulatory Commission            5, XXIV; 18, I
  Property Management Regulations                 41, 109
Energy, Office of                                 7, XXIX
Engineers, Corps of                               33, II; 36, III
Engraving and Printing, Bureau of                 31, VI
Enrichment Corporation, United States             10, XI
Environmental Protection Agency                   5, LIV; 40, I
  Federal Acquisition Regulation                  48, 15
  Property Management Regulations                 41, 115
Environmental Quality, Office of                  7, XXXI
Equal Employment Opportunity Commission           5, LXII; 29, XIV
Equal Opportunity, Office of Assistant Secretary  24, I
     for
Executive Office of the President                 3, I
  Administration, Office of                       5, XV
  Environmental Quality, Council on               40, V
  Management and Budget, Office of                25, III, LXXVII; 48, 99
  National Drug Control Policy, Office of         21, III
  National Security Council                       32, XXI; 47, 2
  Presidential Documents                          3
  Science and Technology Policy, Office of        32, XXIV; 47, II
  Trade Representative, Office of the United      15, XX
       States
Export Administration, Bureau of                  15, VII
Export-Import Bank of the United States           5, LII; 12, IV
Family Assistance, Office of                      45, II
Farm Credit Administration                        5, XXXI; 12, VI
Farm Credit System Insurance Corporation          5, XXX; 12, XIV

[[Page 594]]

Farm Service Agency                               7, VII, XVIII
Federal Acquisition Regulation                    48, 1
Federal Aviation Administration                   14, I
  Commercial Space Transportation                 14, III
Federal Claims Collection Standards               4, II
Federal Communications Commission                 5, XXIX; 47, I
Federal Contract Compliance Programs, Office of   41, 60
Federal Crop Insurance Corporation                7, IV
Federal Deposit Insurance Corporation             5, XXII; 12, III
Federal Election Commission                       11, I
Federal Emergency Management Agency               44, I
  Federal Acquisition Regulation                  48, 44
Federal Employees Group Life Insurance Federal    48, 21
     Acquisition Regulation
Federal Employees Health Benefits Acquisition     48, 16
     Regulation
Federal Energy Regulatory Commission              5, XXIV; 18, I
Federal Financial Institutions Examination        12, XI
     Council
Federal Financing Bank                            12, VIII
Federal Highway Administration                    23, I, II; 49, III
Federal Home Loan Mortgage Corporation            1, IV
Federal Housing Enterprise Oversight Office       12, XVII
Federal Housing Finance Board                     12, IX
Federal Inspector for the Alaska Natural Gas      10, XV
     Transportation System, Office of
Federal Labor Relations Authority, and General    5, XIV; 22, XIV
     Counsel of the Federal Labor Relations 
     Authority
Federal Law Enforcement Training Center           31, VII
Federal Maritime Commission                       46, IV
Federal Mediation and Conciliation Service        29, XII
Federal Mine Safety and Health Review Commission  5, LXXIV; 29, XXVII
Federal Pay, Advisory Committee on                5, IV
Federal Prison Industries, Inc.                   28, III
Federal Procurement Policy Office                 48, 99
Federal Property Management Regulations           41, 101
Federal Property Management Regulations System    41, Subtitle C
Federal Railroad Administration                   49, II
Federal Register, Administrative Committee of     1, I
Federal Register, Office of                       1, II
Federal Reserve System                            12, II
  Board of Governors                              5, LVIII
Federal Retirement Thrift Investment Board        5, VI, LXXVI
Federal Service Impasses Panel                    5, XIV
Federal Trade Commission                          5, XLVII; 16, I
Federal Transit Administration                    49, VI
Federal Travel Regulation System                  41, Subtitle F
Fine Arts, Commission on                          45, XXI
Fiscal Service                                    31, II
Fish and Wildlife Service, United States          50, I, IV
Fishery Conservation and Management               50, VI
Food and Drug Administration                      21, I
Food and Consumer Service                         7, II
Food Safety and Inspection Service                9, III
Foreign Agricultural Service                      7, XV
Foreign Assets Control, Office of                 31, V
Foreign Claims Settlement Commission of the       45, V
     United States
Foreign Service Grievance Board                   22, IX
Foreign Service Impasse Disputes Panel            22, XIV
Foreign Service Labor Relations Board             22, XIV
Foreign-Trade Zones Board                         15, IV
Forest Service                                    36, II
General Accounting Office                         4, I, II
General Services Administration                   5, LVII
  Contract Appeals, Board of                      48, 61
  Federal Acquisition Regulation                  48, 5
  Federal Property Management Regulations System  41, 101, 105
  Federal Travel Regulation System                41, Subtitle F
  Payment From a Non-Federal Source for Travel    41, 304
     Expenses
[[Page 595]]

  Payment of Expenses Connected With the Death    41, 303
       of Certain Employees
  Relocation Allowances                           41, 302
  Travel Allowances                               41, 301
Geological Survey                                 30, IV
Government Ethics, Office of                      5, XVI
Government National Mortgage Association          24, III
Grain Inspection, Packers and Stockyards          7, VIII; 9, II
     Administration
Great Lakes Pilotage                              46, III
Harry S. Truman Scholarship Foundation            45, XVIII
Health and Human Services, Department of          5, XLV; 45, Subtitle A
  Child Support Enforcement, Office of            45, III
  Children and Families, Administration for       45, II, III, IV, X
  Community Services, Office of                   45, X
  Family Assistance, Office of                    45, II
  Federal Acquisition Regulation                  48, 3
  Food and Drug Administration                    21, I
  Health Care Financing Administration            42, IV
  Human Development Services, Office of           45, XIII
  Indian Health Service                           25, V
  Inspector General (Health Care), Office of      42, V
  Public Health Service                           42, I
  Refugee Resettlement, Office of                 45, IV
Health Care Financing Administration              42, IV
Housing and Urban Development, Department of      5, LXV; 24, Subtitle B
  Community Planning and Development, Office of   24, V, VI
       Assistant Secretary for
  Equal Opportunity, Office of Assistant          24, I
       Secretary for
  Federal Acquisition Regulation                  48, 24
  Federal Housing Enterprise Oversight, Office    12, XVII
       of
  Government National Mortgage Association        24, III
  Housing--Federal Housing Commissioner, Office   24, II, VIII, X, XX
       of Assistant Secretary for
  Inspector General, Office of                    24, XII
  Public and Indian Housing, Office of Assistant  24, IX
       Secretary for
  Secretary, Office of                            24, Subtitle A, VII
Housing--Federal Housing Commissioner, Office of  24, II, VIII, X, XX
     Assistant Secretary for
Human Development Services, Office of             45, XIII
Immigration and Naturalization Service            8, I
Independent Counsel, Office of                    28, VII
Indian Affairs, Bureau of                         25, I, V
Indian Affairs, Office of the Assistant           25, VI
     Secretary
Indian Arts and Crafts Board                      25, II
Indian Health Service                             25, V
Information Agency, United States                 22, V
  Federal Acquisition Regulation                  48, 19
Information Resources Management, Office of       7, XXVII
Information Security Oversight Office, National   32, XX
     Archives and Records Administration
Inspector General
  Agriculture Department                          7, XXVI
  Health and Human Services Department            42, V
  Housing and Urban Development Department        24, XII
Institute of Peace, United States                 22, XVII
Inter-American Foundation                         5, LXIII; 22, X
Intergovernmental Relations, Advisory Commission  5, VII
     on
Interior Department
  American Indians, Office of the Special         25, VII
       Trustee
  Endangered Species Committee                    50, IV
  Federal Acquisition Regulation                  48, 14
  Federal Property Management Regulations System  41, 114
  Fish and Wildlife Service, United States        50, I, IV
  Geological Survey                               30, IV
  Indian Affairs, Bureau of                       25, I, V
  Indian Affairs, Office of the Assistant         25, VI
       Secretary
  Indian Arts and Crafts Board                    25, II

[[Page 596]]

  Land Management, Bureau of                      43, II
  Minerals Management Service                     30, II
  Mines, Bureau of                                30, VI
  National Indian Gaming Commission               25, III
  National Park Service                           36, I
  Reclamation, Bureau of                          43, I
  Secretary of the Interior, Office of            43, Subtitle A
  Surface Mining and Reclamation Appeals, Board   30, III
       of
  Surface Mining Reclamation and Enforcement,     30, VII
       Office of
Internal Revenue Service                          26, I
International Boundary and Water Commission,      22, XI
     United States and Mexico, United States 
     Section
International Development, United States Agency   22, II
     for
  Federal Acquisition Regulation                  48, 7
International Development Cooperation Agency,     22, XII
     United States
  International Development, United States        22, II; 48, 7
       Agency for
  Overseas Private Investment Corporation         5, XXXIII; 22, VII
International Fishing and Related Activities      50, III
International Investment, Office of               31, VIII
International Joint Commission, United States     22, IV
     and Canada
International Organizations Employees Loyalty     5, V
     Board
International Trade Administration                15, III; 19, III
International Trade Commission, United States     19, II
Interstate Commerce Commission                    5, XL
James Madison Memorial Fellowship Foundation      45, XXIV
Japan-United States Friendship Commission         22, XVI
Joint Board for the Enrollment of Actuaries       20, VIII
Justice Department                                5, XXVIII; 28, I
  Drug Enforcement Administration                 21, II
  Federal Acquisition Regulation                  48, 28
  Federal Claims Collection Standards             4, II
  Federal Prison Industries, Inc.                 28, III
  Foreign Claims Settlement Commission of the     45, V
       United States
  Immigration and Naturalization Service          8, I
  Offices of Independent Counsel                  28, VI
  Prisons, Bureau of                              28, V
  Property Management Regulations                 41, 128
Labor Department                                  5, XLII
  Benefits Review Board                           20, VII
  Employees' Compensation Appeals Board           20, IV
  Employment and Training Administration          20, V
  Employment Standards Administration             20, VI
  Federal Acquisition Regulation                  48, 29
  Federal Contract Compliance Programs, Office    41, 60
       of
  Federal Procurement Regulations System          41, 50
  Labor-Management Standards, Office of           29, II, IV
  Mine Safety and Health Administration           30, I
  Occupational Safety and Health Administration   29, XVII
  Pension and Welfare Benefits Administration     29, XXV
  Public Contracts                                41, 50
  Secretary of Labor, Office of                   29, Subtitle A
  Veterans' Employment and Training, Office of    41, 61; 20, IX
       the Assistant Secretary for
  Wage and Hour Division                          29, V
  Workers' Compensation Programs, Office of       20, I
Labor-Management Standards, Office of             29, II, IV
Land Management, Bureau of                        43, II
Legal Services Corporation                        45, XVI
Library of Congress                               36, VII
  Copyright Office                                37, II
Management and Budget, Office of                  5, III, LXXVII; 48, 99
Marine Mammal Commission                          50, V
Maritime Administration                           46, II
Merit Systems Protection Board                    5, II
Micronesian Status Negotiations, Office for       32, XXVII

[[Page 597]]

Mine Safety and Health Administration             30, I
Minerals Management Service                       30, II
Mines, Bureau of                                  30, VI
Minority Business Development Agency              15, XIV
Miscellaneous Agencies                            1, IV
Monetary Offices                                  31, I
National Aeronautics and Space Administration     5, LIX; 14, V
  Federal Acquisition Regulation                  48, 18
National Agricultural Library                     7, XLI
National Agricultural Statistics Service          7, XXXVI
National Archives and Records Administration      5, LXVI; 36, XII
  Information Security Oversight Office           32, XX
National Bureau of Standards                      15, II
National Capital Planning Commission              1, IV
National Commission for Employment Policy         1, IV
National Commission on Libraries and Information  45, XVII
     Science
National and Community Service, Corporation for   45, XXV
National Council on Disability                    34, XII
National Credit Union Administration              12, VII
National Drug Control Policy, Office of           21, III
National Foundation on the Arts and the           45, XI
     Humanities
National Highway Traffic Safety Administration    23, II, III; 49, V
National Indian Gaming Commission                 25, III
National Institute for Literacy                   34, XI
National Institute of Standards and Technology    15, II
National Labor Relations Board                    5, LXI; 29, I
National Marine Fisheries Service                 50, II, IV
National Mediation Board                          29, X
National Oceanic and Atmospheric Administration   15, IX; 50, II, III, IV, 
                                                  VI
National Park Service                             36, I
National Railroad Adjustment Board                29, III
National Railroad Passenger Corporation (AMTRAK)  49, VII
National Science Foundation                       5, XLIII; 45, VI
  Federal Acquisition Regulation                  48, 25
National Security Council                         32, XXI
National Security Council and Office of Science   47, II
     and Technology Policy
National Telecommunications and Information       15, XXIII; 47, III
     Administration
National Transportation Safety Board              49, VIII
National Weather Service                          15, IX
Natural Resources Conservation Service            7, VI
Navajo and Hopi Indian Relocation, Office of      25, IV
Navy Department                                   32, VI
  Federal Acquisition Regulation                  48, 52
Neighborhood Reinvestment Corporation             24, XXV
Northeast Dairy Compact Commission                7, XIII
Nuclear Regulatory Commission                     5, XLVIII; 10, I
  Federal Acquisition Regulation                  48, 20
Occupational Safety and Health Administration     29, XVII
Occupational Safety and Health Review Commission  29, XX
Offices of Independent Counsel                    28, VI
Operations Office                                 7, XXVIII
Overseas Private Investment Corporation           5, XXXIII; 22, VII
Panama Canal Commission                           48, 35
Panama Canal Regulations                          35, I
Patent and Trademark Office                       37, I
Payment From a Non-Federal Source for Travel      41, 304
     Expenses
Payment of Expenses Connected With the Death of   41, 303
     Certain Employees
Peace Corps                                       22, III
Pennsylvania Avenue Development Corporation       36, IX
Pension and Welfare Benefits Administration       29, XXV
Pension Benefit Guaranty Corporation              29, XL
Personnel Management, Office of                   5, I, XXXV; 45, VIII
  Federal Acquisition Regulation                  48, 17
  Federal Employees Group Life Insurance Federal  48, 21
     Acquisition Regulation
[[Page 598]]

  Federal Employees Health Benefits Acquisition   48, 16
       Regulation
Postal Rate Commission                            5, XLVI; 39, III
Postal Service, United States                     5, LX; 39, I
Postsecondary Education, Office of                34, VI
President's Commission on White House             1, IV
     Fellowships
Presidential Commission on the Assignment of      32, XXIX
     Women in the Armed Forces
Presidential Documents                            3
Prisons, Bureau of                                28, V
Productivity, Technology and Innovation,          37, IV
     Assistant Secretary
Public Contracts, Department of Labor             41, 50
Public and Indian Housing, Office of Assistant    24, IX
     Secretary for
Public Health Service                             42, I
Railroad Retirement Board                         20, II
Reclamation, Bureau of                            43, I
Refugee Resettlement, Office of                   45, IV
Regional Action Planning Commissions              13, V
Relocation Allowances                             41, 302
Research and Special Programs Administration      49, I
Rural Business-Cooperative Service                7, XVIII, XLII
Rural Development Administration                  7, XLII
Rural Housing Service                             7, XVIII, XXXV
Rural Telephone Bank                              7, XVI
Rural Utilities Service                           7, XVII, XVIII, XLII
Saint Lawrence Seaway Development Corporation     33, IV
Science and Technology Policy, Office of          32, XXIV
Science and Technology Policy, Office of, and     47, II
     National Security Council
Secret Service                                    31, IV
Securities and Exchange Commission                17, II
Selective Service System                          32, XVI
Small Business Administration                     13, I
Smithsonian Institution                           36, V
Social Security Administration                    20, III; 48, 23
Soldiers' and Airmen's Home, United States        5, XI
Special Counsel, Office of                        5, VIII
Special Education and Rehabilitative Services,    34, III
     Office of
State Department                                  22, I
  Federal Acquisition Regulation                  48, 6
Surface Mining and Reclamation Appeals, Board of  30, III
Surface Mining Reclamation and Enforcement,       30, VII
     Office of
Surface Transportation Board                      49, X
Susquehanna River Basin Commission                18, VIII
Technology Administration                         15, XI
Technology Policy, Assistant Secretary for        37, IV
Technology, Under Secretary for                   37, V
Tennessee Valley Authority                        5, LXIX; 18, XIII
Thrift Depositor Protection Oversight Board       12, XV
Thrift Supervision Office, Department of the      12, V
     Treasury
Trade Representative, United States, Office of    15, XX
Transportation, Department of                     5, L
  Coast Guard                                     33, I; 46, I; 49, IV
  Commercial Space Transportation                 14, III
  Contract Appeals, Board of                      48, 63
  Emergency Management and Assistance             44, IV
  Federal Acquisition Regulation                  48, 12
  Federal Aviation Administration                 14, I
  Federal Highway Administration                  23, I, II; 49, III
  Federal Railroad Administration                 49, II
  Federal Transit Administration                  49, VI
  Maritime Administration                         46, II
  National Highway Traffic Safety Administration  23, II, III; 49, V
  Research and Special Programs Administration    49, I
  Saint Lawrence Seaway Development Corporation   33, IV
  Secretary of Transportation, Office of          14, II; 49, Subtitle A
  Surface Transportation Board                    49, X

[[Page 599]]

Transportation, Office of                         7, XXXIII
Travel Allowances                                 41, 301
Treasury Department                               5, XXI; 17, IV
  Alcohol, Tobacco and Firearms, Bureau of        27, I
  Community Development Financial Institutions    12, XVIII
       Fund
  Comptroller of the Currency                     12, I
  Customs Service, United States                  19, I
  Engraving and Printing, Bureau of               31, VI
  Federal Acquisition Regulation                  48, 10
  Federal Law Enforcement Training Center         31, VII
  Fiscal Service                                  31, II
  Foreign Assets Control, Office of               31, V
  Internal Revenue Service                        26, I
  International Investment, Office of             31, VIII
  Monetary Offices                                31, I
  Secret Service                                  31, IV
  Secretary of the Treasury, Office of            31, Subtitle A
  Thrift Supervision, Office of                   12, V
Truman, Harry S. Scholarship Foundation           45, XVIII
United States and Canada, International Joint     22, IV
     Commission
United States and Mexico, International Boundary  22, XI
     and Water Commission, United States Section
United States Enrichment Corporation              10, XI
Utah Reclamation Mitigation and Conservation      43, III
     Commission
Veterans Affairs Department                       38, I
  Federal Acquisition Regulation                  48, 8
Veterans' Employment and Training, Office of the  41, 61; 20, IX
     Assistant Secretary for
Vice President of the United States, Office of    32, XXVIII
Vocational and Adult Education, Office of         34, IV
Wage and Hour Division                            29, V
Water Resources Council                           18, VI
Workers' Compensation Programs, Office of         20, I
World Agricultural Outlook Board                  7, XXXVIII

[[Page 601]]



List of CFR Sections Affected



All changes in this volume of the Code of Federal Regulations which were 
made by documents published in the Federal Register since January 1, 
1986, are enumerated in the following list. Entries indicate the nature 
of the changes effected. Page numbers refer to Federal Register pages. 
The user should consult the entries for chapters and parts as well as 
sections for revisions.
For the period before January 1, 1986, see the ``List of CFR Sections 
Affected, 1973-1985,'' published in four separate volumes.

                                  1986

48 CFR
                                                                   51 FR
                                                                    Page
Chapter 3
301.105  Amended...................................................44293
301.670-3  (a) amended.............................................44293
302.100  Amended...................................................23231
    Amended........................................................44293
    Technical correction...........................................47353
303.704 (Subpart 303.7)  Added.....................................44293
304.601  Redesignated as 304.602...................................44293
304.602  Redesignated from 304.601.................................44293
304.7101  (c) amended..............................................44293
305  Subchapter assignment; editorial note..........................6004
305.202 (Subpart 305.2)  Added.....................................44293
306  Subchapter assignment; editorial note..........................6004
306.202  (a) revised; (b) amended..................................44293
306.302-1  Heading revised; (b)(2) and (6) redesignated as 
        (a)(2)(ii) and (b)(4); new (a) heading revised; new (b) 
        heading added..............................................44293
307.104  (c) revised...............................................44293
313.404  Removed...................................................44293
314.404  Added.....................................................44294
314.404-1  Added...................................................44294
315.103 (Subpart 315.1)  Added.....................................44294
315.413-2  (e) and (f) amended.....................................44294
315.608  (b) amended...............................................44294
315.804  Added.....................................................44294
315.804-3  Added...................................................44294
316.301-3  (c) introductory text amended...........................44294
316.306  Added.....................................................44294
316.403 (Subpart 316.4)  Added.....................................44294
316.603-3  Amended.................................................44294
319.870  (a)(1) and (6) amended....................................44294
322  Added.........................................................44294
322.604-2  Heading correctly added.................................47353
325.102  (b) revised...............................................44294
    (b) correctly designated.......................................47353
330.304 (Subpart 330.3)  Added.....................................44294
332.402  Revised...................................................44294
332.406  (c)(2) amended............................................44294
332.407  (d) amended...............................................44294
332.409-1  Amended.................................................44294
332.501--332.501-2 (Subpart 332.5)  Added..........................44294
353.370-393  Added.................................................44295
Chapter 3, Appendix A
PHS 301.105  Table revised (OMB numbers)...........................20486
PHS 301.207  Heading, (a), and (b) amended.........................20486
PHS 301.470  (b) introductory text amended; (b)(1), (2) and (5) 
        removed; (b)(3) and (4) redesignated as (b)(1) and (2).....20486
PHS 304.670-1  Amended.............................................20486
PHS 304.7101  (b)(2)(i) and (c) table revised; (b)(2)(iii) added 
                                                                   20486
PHS 305  Added.....................................................20487
PHS 306  Added.....................................................20487
PHS 314.406-3  (g)(3) revised......................................20488
PHS 314.406-4  (e)(2) revised......................................20488
PHS 314.407-8  Removed.............................................20488
PHS 314.470  Removed...............................................20488
PHS 315  Removed...................................................20488

[[Page 602]]

    Added; interim.................................................43357
    Effective date corrected.......................................45229
PHS 315.412  (c)(1) corrected......................................45229
PHS 323  Added.....................................................20488
PHS 333  Added.....................................................20488
PHS 335  Added.....................................................20489
PHS 336  Added.....................................................20489
PHS 352.215-10  Added; interim.....................................43357
    Text and effective date corrected..............................45229
PHS 352.223-70  Added..............................................20489
PHS 352.223-71  Added..............................................20490
PHS 352.232-70  Added..............................................20490
PHS 352.280-1  Revised.............................................20490
PHS 352.280-2  Revised.............................................20491
PHS 352.280-4  (a) amended.........................................20491
PHS 380.101--PHS 380.105 (Subpart PHS 380.1)  Revised..............20491
PHS 380.201--PHS 380.206 (Subpart PHS 380.2)  Revised..............20492
Chapter 4
401.601  (a)(9) and (c) removed; (a)(10) redesignated as (a)(9)....34564
401.602-1  Removed.................................................34564
401.603-1  Revised.................................................34564
401.671--401.671-5  Added..........................................34565
401.7001--401.7006 (Subpart 401.70)  Added.........................34565
405--410 (Subchapter B)  Heading revised...........................34566
405  Subchapter assignment; editorial note..........................6004
    Transferred to Subchapter B....................................34566
406  Added.........................................................34566
413.505-70  (b) revised............................................34566
414  Heading revised...............................................34566
414.404-1  Added...................................................34566
414.407-8  Removed.................................................34566
415.103  Added.....................................................34566
415.307 (Subpart 415.3)  Removed...................................34566
422.1003--422.1011 (Subpart 422.10)  Removed.......................34566
433  Revised.......................................................34566
433.003  Correctly redesignated as 433.203 and (a) amended.........41790
433.003-70  Correctly redesignated as 433.203-70...................41790
433.009  Correctly redesignated as 433.209 and amended.............41790
433.011  Correctly redesignated as 433.211 and amended.............41790
433.012  Correctly redesignated as 433.212.........................41790
433.203--433.212  Correctly redesignated as Subpart 433.2..........41790
433.203  Correctly redesignated from 433.003 and (a) amended.......41790
433.203-70  Correctly redesignated from 433.003-70.................41790
433.209  Correctly redesignated from 433.009 and amended...........41790
433.211  Correctly redesignated from 433.011 and amended...........41790
433.212  Correctly redesignated from 433.012.......................41790
436.370 (Subpart 436.3)  Heading revised...........................34567
Chapter 5
501.602-1  Revised.................................................45892
501.603  (a), (b)(1) and (2)(i) and (ii), and (c)(2), (4), and (6) 
        revised; (b)(2)(viii) removed; (b)(2)(ix) through (xiii) 
        redesignated as (b)(2)(viii) through (xii).................45892
501.603-1  Revised.................................................45893
501.603-2  (c)(1), (3) introductory text, (ii)(E), and (v)(C), 
        (4), and (5) introductory text revised; (c)(3)(ii)(F) 
        through (K) and (6) redesignated as (c)(3)(ii)(G) through 
        (L) and (7) and revised; (c)(3)(ii)(F), (v)(D), and (6) 
        added......................................................16690
    (c)(3) introductory text corrected.............................21175
    (c) revised; (d) added.........................................45893
501.603-3  (a) revised.............................................16691
501.704-70  (e) added...............................................5332
501.707  Introductory text and Table 501-1 amended..................5332
501.770  Introductory text amended; (a) through (c), (e) through 
        (g), and (i) through (k) revised............................5332
502.101  Revised...................................................39861
504.7001  Revised..................................................16691
504.7001-1  (b) revised............................................16691
504.7001-2  (c) and (f) amended....................................16691
504.7001-3  Introductory text, (a), and (e) introductory text 
        revised....................................................16691
505  Subchapter assignment; editorial note..........................6004

[[Page 603]]

505.101  See Appendix C Temp. Reg. AC-86-7.........................41507
505.201  See Appendix C Temp. Reg. AC-86-7.........................41507
506  Subchapter assignment; editorial note..........................6004
506.302-1  Revised.................................................44990
506.302-5  Removed.................................................44991
506.303-1  Revised.................................................44991
506.303-2  Revised.................................................44991
506.304  Revised...................................................44991
508.602  (b) revised...............................................24668
508.705-70  (b) revised............................................24668
508.705-73  Temp. Reg. AC-86-3......................................8678
    (a) introductory text and (1) revised..........................24668
509.105-1  (d) revised.............................................39862
    (a) and (c) revised............................................45896
509.106-70  Revised................................................39862
509.406-3  (b)(3) revised..........................................39862
510.011  (c) revised; (d) removed..................................23061
510.070-1  Revised.................................................23061
513  See Temp. Reg. AC-86-4, Supp. 1...............................36700
513.105  See Appendix C Temp. Reg. AC-86-7.........................41507
513.203-1  Revised.................................................45893
    (b) revised....................................................45896
513.403  Revised...................................................45894
513.404  Added.....................................................45894
    Temp. Reg. AC-86-1..............................................1814
513.405  Added.....................................................45894
513.501  Revised...................................................45894
513.505-2  (a) and (b) revised.....................................45894
      Temp. Reg. AC-86-4...........................................12704
513.505-3  (b) revised.............................................45894
513.7001  Temp. Reg. AC-86-1........................................1814
    (a), (b)(1), and (g) revised; (d)(2) and (3) redesignated as 
(d)(3) and (4); new (d)(2) added...................................45894
    Temp. Reg. AC-86-4.............................................12704
514.205-1  (a) revised.............................................16691
514.211  Added.....................................................16692
514.270-1  Revised.................................................45897
514.270-2  (b), (c)(1)(ii) and (2) introductory text, (iv), and 
        (v) revised................................................45897
514.403  Revised...................................................45896
514.407-3  Revised.................................................23061
514.408-1  Added...................................................16692
515.605  Removed...................................................23061
515.605-70  Removed................................................23061
515.608  Revised...................................................23061
515.608-70  Added..................................................23061
515.608-71  Added..................................................23061
515.803  Revised...................................................16692
515.805-5  Revised.................................................16692
516.603-3  Revised.................................................39862
519.501  See Appendix C Temp. Reg. AC-86-7.........................41507
519.502-1  See Appendix C Temp. Reg. AC-86-7.......................41507
Chapter 5  Appendix C Temporary Reg. AC-86-7 added.................41507
519.505  See Appendix C Temp. Reg. AC-86-7.........................41508
519.508  See Appendix C Temp. Reg. AC-86-7.........................41508
522.301  Temp. Reg. AC-86-2.........................................4367
522.302  Temp. Reg. AC-86-2.........................................4367
    Heading revised................................................32655
522.305  Temp. Reg. AC-86-2.........................................4367
522.402-3  Temp. Reg. AC-86-2.......................................4367
    Revised........................................................32655
522.403  (a) amended; (c) revised..................................32655
522.404-1  (a) revised.............................................32655
522.404-4  (a), (b) introductory text, (c) and (d) revised.........32655
522.602  Temp. Reg. AC-86-2.........................................4368
522.1005  Revised..................................................28815
522.1006  Revised..................................................28815
522.1007  Revised..................................................28816
522.1008  Revised..................................................28816
525.105-70  Temp. Reg. AC-86-5.....................................16693
525.105-71  Temp. Reg. AC-86-5.....................................16693
525.402  (a) revised...............................................24668
525.402-71  (c) revised............................................24668
528.106-6  Revised.................................................23061
532.111  (a) revised...............................................23061
    (b), (c), (d) (1) and (2), and (e) introductory text and (1) 
revised; (f) and (g) added.........................................23063
    (b)(2) and (f) corrected.......................................26251
533.104  (a)(3) (v) and (vi), (4), (b), and (c) revised; (a)(5) 
        amended; (d) added..........................................5333
533.105  (a)(1) introductory text and (ii), (b) introductory text, 
        (c), and (d)(3) revised; (a)(1)(iii) amended................5334
536.302-70  (c) introductory text, (1) and (2) revised..............5334
536.303  Revised....................................................5334
536.303-70  Revised.................................................5334
546.301  Added......................................................8679
546.302  Amended....................................................8679
546.302-70  Revised.................................................8679
546.302-71  Revised.................................................8679

[[Page 604]]

546.302-72  Revised.................................................8679
546.400  Revised...................................................35221
546.402  Revised...................................................35221
546.403  Revised...................................................35221
546.407  Removed...................................................35221
546.470  Revised...................................................35221
546.470-1  Revised.................................................35221
546.470-2  (b) revised.............................................35221
549.502--549.570 (Subpart 549.5)  Added..............................195
552.210-71  Amended................................................23061
552.210-72  Revised................................................23062
552.210-73  Revised................................................23062
552.210-74  Introductory text revised..............................23062
552.212-72  (a) and (b) amended....................................45895
552.214-16  Added..................................................45898
552.219-4  See Appendix C Temp. Reg. AC-86-7.......................41508
552.219-71  Revised................................................28816
552.222-43  Revised................................................28816
552.222-71  Temp. Reg. AC-86-2......................................4368
    Removed........................................................32656
552.222-84  Revised................................................28817
552.222-85  Introductory text revised..............................28817
552.222-86  Introductory text revised..............................28818
552.225-71  Temp. Reg. AC-86-5.....................................16693
552.232-8  Revised.................................................23062
552.232-23  Revised................................................23062
552.232-70  See Temp. Reg. AC-85-1, Supp. 2.........................5335
    (a) and (b) revised; (c) through (f) removed; (g) redesignated 
as (c) and introductory text revised...............................23063
552.232-71  Revised................................................23064
552.232-72  Introductory text revised..............................23064
552.232-78  Added..................................................23064
552.232-79  Added..................................................23065
552.246-70  Introductory text revised...............................8679
552.246-71  Introductory text revised...............................8679
552.246-72  Introductory text revised...............................8679
552.246-73  Amended.................................................8679
552.246-74  Amended.................................................8680
552.246-75  Amended.................................................8680
552.246-76  Revised.................................................8680
552.246-77  Added...................................................8680
552.247-70  Introductory text revised................................195
552.249-70  Added....................................................195
552.249-71  Added....................................................196
552.249-72  Added....................................................196
553  See Temp. Reg. AC-86-4, Supp. 1...............................36700
    (c) table amended..............................................45896
553.173  (c) table amended...................................8681, 16692
553.270-3  Temp. Reg. AC-86-2.......................................4368
    (a), (b), (c), and (e) revised.................................32656
    (b) revised....................................................45895
553.272  Temp. Reg. AC-86-4........................................12705
    (a), (b), and (d) revised......................................45895
553.273  Temp. Reg. AC-86-4........................................12705
    Revised.................................................45895, 45896
553.275  (a) revised...............................................45895
553.370-300-I  Temp. Reg. AC-86-4..................................12705
553.370-3539  Added.................................................8680
Chapter 5  Temporary Reg. AC-86-1 added.............................1814
    Temporary Reg. AC-86-2 added....................................4367
    Temporary Reg. AC-85-1, Supp. 2 added...........................5335
    Temporary Reg. AC-86-3 added....................................8678
    Temporary Reg. AC-86-4 added...................................12704
    Temporary Reg. AC-86-4 technical correction....................16175
    Temporary Reg. AC-85-5 added...................................16693
    Temporary Reg. AC-86-1, Supp. 1 added..........................25703
    Temporary Reg. AC-86-6 added...................................25703
    Temporary Reg. AC-86-4, Supp. 1 added..........................36700

                                  1987

48 CFR
                                                                   52 FR
                                                                    Page
Chapter 3
301.670-2  (b) revised.............................................27558
302.100  Amended...................................................27558
304.7101  (c) amended..............................................27558
306.501  Amended...................................................27558
319.801--319.870 (Subpart 319.8)  Revised..........................27558
332.402  Revised...................................................27560
332.407  (d) amended...............................................27560
332.409-1  Amended.................................................27560
332.501-2  (a)(3) amended..........................................27560
352.227-1  Removed.................................................27560

[[Page 605]]

Chapter 3, Appendix A
PHS 315.412  Addition confirmed; (c)(1) amended....................44397
PHS 352.215-10  Addition confirmed.................................44397
PHS 352.280-1  (b) amended..........................................9300
PHS 352.280-2  (b) amended..........................................9300
Chapter 5
503.303 (Subpart 503.3)  Heading revised............................5982
503.700--503.705 (Subpart 503.7)  Added.............................5982
505.101  Revised...................................................22655
505.201  Revised...................................................22655
505.202  (c) added.................................................22655
505.203  Added.....................................................22655
505.207  (b) revised...............................................22655
507.305  Temporary Reg. AC-87-1 added...............................8590
    Revised........................................................28827
    Temporary Reg. AC-87-1, Supp. 1 added..........................35093
507.306  Temporary Reg. AC-87-1 added...............................8590
    Temporary Reg. AC-87-1, Supp. 1 added..........................35093
507.307  Revised...................................................28827
508.802  Revised...................................................28827
508.870  Removed...................................................28827
509.403  (a) revised...............................................22656
509.404  Revised...................................................22656
509.405  Revised...................................................22656
514.201-6  (b) removed..............................................6562
514.201-71  (b) revised.............................................6562
515.407  (b) removed................................................6562
515.411-70  Revised.................................................6563
519.001  Added.....................................................16390
519.201  Removed...................................................16391
519.202  (a), (b), (c), and (e) revised............................16391
519.202-5  Revised.................................................16391
519.302  Revised...................................................16391
519.304  Added.....................................................16391
519.501  Removed...................................................16391
519.502-1  (a), (b), (c), (d), (f), (g), (h), (i) and (j) revised 
                                                                   16391
519.502-2  Removed.................................................16392
519.502-3  Revised.................................................16392
519.502-70  Added..................................................16392
519.503  Revised...................................................16392
519.505  Removed...................................................16393
519.506  Removed...................................................16393
519.602--519.602-1  Added..........................................16393
519.602-3  Added...................................................16393
519.705  Added.....................................................34388
519.705-4  Added...................................................34388
519.705-5  Added...................................................34388
519.705-6  Revised.................................................34388
519.706-70  Temporary Reg. AC-87-3 added...........................47396
519.770  Added.....................................................34389
519.770-1  Added...................................................34389
519.770-2  Added...................................................34389
519.770-3  Temporary Reg. AC-87-3 added............................47397
522.1308  Temporary Reg. AC-87-2 added.............................12182
    Temporary Reg. AC-87-2, Supp. 1 added..........................37618
522.1370  Temporary Reg. AC-87-2 added.............................12182
    Temporary Reg. AC-87-2, Supp. 1 added..........................37618
525.105-70  Heading, (b), (c), and (d) revised.......................278
525.105-71  Revised..................................................279
525.105-72  (b) and (c) revised......................................279
525.108-70  (a) introductory text, (b) introductory text, and (c) 
        revised......................................................279
525.402  Temporary Reg. AC-86-8 added.................................58
    Temporary Reg. AC-86-8, Supp. 1 added..........................28828
528.102-1  (a) revised..............................................6564
528.301  Revised....................................................6564
532.111  (a)(1) revised............................................47006
533.102  (b) revised................................................6563
533.105  (a)(1)(ii), (3) and (4) and (b) introductory text and (3) 
        revised.....................................................6563
537.201  Revised....................................................6563
537.205  Revised....................................................6563
542.1107  (a) revised..............................................21057
542.7000--542.7002-3 (Subpart 542.70)  Added.......................11826
552.203-70  Amended................................................28827
552.207-70  Introductory text revised..............................28827
552.207-71  Temporary Reg. AC-87-1 added............................8590
    Temporary Reg. AC-87-1, Supp. 1 added..........................35093
552.214-71  Introductory text revised...............................6563
552.214-72  Removed.................................................6563
552.214-73  Introductory text revised...............................6563
552.214-74  Introductory text revised...............................6563
552.214-75  Introductory text revised...............................6564

[[Page 606]]

552.215-71  Introductory text revised...............................6564
552.215-72  Removed.................................................6564
552.215-73  Introductory text revised...............................6564
552.215-74  Introductory text revised...............................6564
552.219-1  Added...................................................16393
552.219-70  Revised................................................16393
552.222-87  Temporary Reg. AC-87-2 added...........................12182
    Temporary Reg. AC-87-2, Supp. 1 added..........................37618
552.225-70  Revised..................................................280
552.225-71  Revised..................................................280
552.225-72  Revised..................................................280
552.225-73  Introductory text revised................................280
552.225-74  Introductory text revised................................280
552.232-8  Amended.................................................47006
552.242-70  Temporary Reg. AC-86-6, Supp. 1 added...................1333
    Revised........................................................21057
553.173  (c) table amended.........................................34389
553.270-1  Revised.................................................28828
553.270-2  (a) and (b) revised.....................................28828
553.270-3  (e) revised.............................................21057
553.272  (a) revised...............................................47006
553.273  (a) revised...............................................47007
553.370-3507  GSA Form 3507 amended................................21057
553.370-3584  GSA Form No. 3584....................................34389

                                  1988

48 CFR
                                                                   53 FR
                                                                    Page
Chapter 3
301.105  Table amended.............................................15562
301.304  (d) table amended.........................................43206
301.602-3  Added...................................................43206
301.603--301-670-3 (Subpart 301.6)  Revised........................15562
302.100  Amended...................................................43207
304.170  Removed...................................................43207
304.7005  Amended..................................................15563
305.102  Removed...................................................43207
305.303 (Subpart 305.3)  Added.....................................43207
306.501  Amended...................................................15563
306.501  Amended...................................................43207
307.105-2  (a)(3) amended..........................................15563
307.105-2  (a) (1) and (2) amended; (a) (3), (4), and (9) revised; 
        (a)(11) removed; (a) (12) through (15) redesignated as (a) 
        (11) through (14); new (a) (11) and (12) amended...........43207
    (a)(9) heading corrected.......................................44551
313.104  (h), (i), and (j) redesignated as (i), (j), and (k).......15563
315.406-5  (a)(2)(xv) amended; (a)(2) (xvi) and (xviii) removed; 
        (a)(2)(xvii) redesignated as (a)(2)(xvi) and amended.......43207
315.408  Amended...................................................43208
315.608-71  (a)(1) amended.........................................15563
315.905-71  (b) amended............................................15563
315.905-73  (b)(1) amended.........................................15563
315.905-74  Amended................................................15563
315.7002  (a) amended..............................................15563
317.206  Amended...................................................43208
317.7100--317.7102 (Subpart 317.71)  Revised.......................43208
319.870  (a) (2) and (4) amended...................................43208
330.7000--330.7002-6 (Subpart 330.70)  Removed.....................15563
332.770  Removed...................................................15563
332.902--332.905 (Subpart 332.9)  Added............................43208
332.905  (a)(2)(ii) and (b)(3) corrected...........................44551
333.203--333.214 (Subpart 333.2)  Added............................15563
339.7001  Introductory text, (a), and (b) amended..................43208
339.7002  (a) and (b) (2) and (3) amended..........................43208
342.7200--342.7206-3 (Subpart 342.72)  Removed.....................43209
352.202-1  Introductory text amended...............................15564
352.208.70  Removed................................................15564
352.215-70  Removed................................................15564
352.225-12  Removed................................................15564
352.232-72  Removed................................................15564
352.237-71  Removed................................................15564
352.242-70  Removed................................................15564
352.242-72--342.242-79  Removed....................................43209
352.243-70  Removed................................................15564
352.247-70  Removed................................................15564
352.270-6  Removed.................................................15564
352.270-8  Removed.................................................15564
352.370  Amended...................................................15564
Chapter 4
404.670  Added......................................................6062

[[Page 607]]

404.7001 (Subpart 404.70)  Added....................................6062
407.305  Added......................................................6063
409.504  Added......................................................6063
410.011  Added......................................................6063
412  Added..........................................................6063
414.201--414.201-6 (Subpart 414.2)  Added...........................6063
415.407  Added......................................................6063
415.608  Added......................................................6063
415.1070  Added.....................................................6063
416.404-2  Revised..................................................6063
416.405  Added......................................................6065
416.470  Added......................................................6065
416.505--416.570 (Subpart 416.5)  Added.............................6065
416.603-4  Added....................................................6065
416.670  Added......................................................6065
417.208 (Subpart 417.2)  Added......................................6065
419.508  Added......................................................6066
422.7001--422.7005 (Subpart 422.70)  Added..........................6066
424.104 (Subpart 424.1)  Added......................................6066
425.402--425.407 (Subpart 425.4)  Added.............................6067
428.102-3  Revised..................................................6067
428.310  Added......................................................6067
432.103  Added......................................................6067
432.111  Revised....................................................6067
432.7000--432.7004 (Subpart 432.70)  Removed........................6067
436.370  Amended....................................................6067
436.570--436.579 (Subpart 436.5)  Revised...........................6067
437.110  Added......................................................6068
437.270  Added......................................................6068
439.7001  Revised...................................................6068
    Heading corrected..............................................12748
439.7002  Revised...................................................6068
442.704 (Subpart 442.7)  Added......................................6069
445.106 (Subpart 445.1)  Added......................................6069
445.302-7  Added....................................................6069
446.370 (Subpart 446.3)  Added......................................6069
447  Added..........................................................6069
452.204-70--452.252-70 (Subpart 452.2)  Revised.....................6069
452.236-77  Heading corrected......................................12748
Chapter 5
501.102  Revised.....................................................130
501.103  (b) revised.................................................130
501.105  Introductory text republished; table amended (OMB 
        numbers).....................................................130
501.105  Table amended (OMB numbers)...............................51107
501.170-3  Revised...................................................131
501.170-4  (a) revised...............................................131
    (a) corrected...................................................1540
501.171-1  Revised...................................................131
501.171-2  Revised...................................................131
501.402  Revised.....................................................131
501.403  Revised.....................................................132
501.404  Revised.....................................................132
501.602-3  Temporary Reg. AC-88-1 added.............................7366
501.603  Temporary Reg. AC-87-4 added................................132
501.675  Temporary Reg. AC-88-1 added...............................7366
501.675-1  Temporary Reg. AC-88-1 added.............................7366
501.675-2  Temporary Reg. AC-88-1 added.............................7366
501.675-3  Temporary Reg. AC-88-1 removed...........................7366
504.803  (a) (23) and (24) combined as (a)(23) and revised; (a) 
        (25) through (29) redesignated as (a) (24) through (28) 
        and revised................................................30842
504.805  Revised...................................................30842
505.301  Temporary Reg. AC-88-2 added..............................28886
507.305  Temporary Reg. AC-87-1, Supp. 2 added.....................10395
    Temporary Reg. AC-87-1, Supp. 3 added..........................36580
507.306  Temporary Reg. AC-87-1, Supp. 2 added.....................10395
    Temporary Reg. AC-87-1, Supp. 3 added..........................36580
513.203-1  Temporary Reg. AC-87-4 added..............................132
513.404  Temporary Reg. AC-87-4 added................................132
513.505-3  Temporary Reg. AC-87-4 added..............................133
    Correctly designated............................................1441
513.7001  Temporary Reg. AC-87-4 added...............................133
514.201-6  (a) removed.............................................30842
514.301-70  Revised................................................30842
514.304-1  Revised.................................................30842
514.370  Revised...................................................30842
514.401  (a) introductory text, (1), and (4) revised and (c) added
                                                                   30842
514.402-1  (a) revised.............................................30843
514.402-3  (a) revised.............................................30843
514.406-3  (b) and (c) revised.....................................30843

[[Page 608]]

514.406-4  Revised.................................................30843
514.407-1  Added...................................................17949
514.408-1  Temporary Reg. AC-88-2 added............................28886
514.414  Added.....................................................17949
515.407  (a) removed...............................................30843
515.411  Revised...................................................30843
515.411-70  Revised................................................30843
515.412  Added.....................................................30843
515.1070  Revised..................................................30844
519.502-1  Revised.................................................33812
519.701  Temporary Reg. AC-88-3 added..............................48911
519.702  Temporary Reg. AC-88-3 added..............................48911
519.704  Temporary Reg. AC-88-3 added..............................48911
519.705-2  Temporary Reg. AC-88-3 added............................48911
519.705-4  Temporary Reg. AC-88-3 added............................48911
519.705-5  Temporary Reg. AC-88-3 added............................48912
519.705-6  Temporary Reg. AC-88-3 added............................48912
519.706  Added.....................................................33812
519.706-70  Temporary Reg. AC-87-3, Supp. 1 added..................21824
    Added..........................................................33812
    Added..........................................................33813
519.706-70  (b) and (d) corrected..................................39096
    Temporary Reg. AC-88-3 added...................................48912
519.708  Temporary Reg. AC-88-3 added..............................48913
519.770-1  (b)(1)(i) revised.......................................33813
519.770-1  (b)(1)(i) corrected.....................................39096
    Temporary Reg. AC-88-3 added...................................48913
519.770-3  Temporary Reg. AC-87-3, Supp. 1 added...................21824
519.770-3  Temporary Reg. AC-88-3 added............................48913
522.302  Revised...................................................51108
522.303  Removed...................................................51108
522.4  Revised.....................................................51108
522.1007  (a) revised..............................................30844
525.202--525.205 (Subpart 525.2)  Added.............................9629
525.401  Temporary Reg. AC-88-2 added..............................28886
525.402  Temporary Reg. AC-86-8, Supp. 2 added......................1925
    (a) and (c) revised.............................................4170
525.402-70  Temporary Reg. AC-88-2 added...........................28886
532.111  Temporary Reg. AC-88-1 added...............................7366
532.606-70  Revised................................................30844
532.904  Temporary Reg. AC-88-1 added...............................7366
532.908  Temporary Reg. AC-88-1 added...............................7366
534.002-70  Revised................................................30844
536.201  (c) revised...............................................30844
537.110  (a) and (b) revised.......................................30844
542.1203 (Subpart 542.12)  Added...................................34090
552.207-71  Temporary Reg. AC-87-1, Supp. 2 added..................10395
    Temporary Reg. AC-87-1, Supp. 3 added..........................36580
552.210-78  Revised................................................30844
552.210-79  Introductory text revised..............................30845
552.214-71  Removed................................................30845
552.215-71  Removed................................................30845
552.219-72  Temporary Reg. AC-88-3 added...........................48913
552.222-70--552.222-80  Removed....................................51108
552.222-81  Revised................................................51109
552.225-75  Added...................................................9630
552.232-70  Temporary Reg. AC-88-1 added............................7367
552.232-71  Temporary Reg. AC-88-1 added............................7367
552.232-72  Temporary Reg. AC-88-1 added............................7368
552.232-73  Temporary Reg. AC-88-1 added............................7368
552.237-1  Redesignated as 552.237-70 and introductory text 
        revised....................................................30845
552.237-70  Redesignated from 552.237-1 and introductory text 
        revised....................................................30845
552.237-71  Introductory text revised..............................30845
552.237-72  Introductory text revised..............................30845
552.300  Amended...................................................17950
553.173  (c) table amended.........................................51109
553.270-1  Revised.................................................51109
553.270-3  (c) revised.............................................51109
553.370  Amended...................................................30845
    Correctly designated...........................................32820
Chapter 5  Appendix C removed......................................30842

[[Page 609]]

Chapter 6
Chapter 6  Chapter established.....................................26159
601--604 (Subchapter A)  Added.....................................26159
601  Added.........................................................26159
602  Added.........................................................26162
603  Added.........................................................26163
604  Added.........................................................26163
604.7001  Corrected................................................36461
605--609 (Subchapter B)  Added.....................................26164
605  Added.........................................................26164
606  Added.........................................................26165
606.101-70  Corrected..............................................36461
608  Added.........................................................26165
609  Added.........................................................26165
609.404  Correctly designated......................................36461
609.406-3  (a)(2)(iii) and (b)(6) corrected........................36461
613--617 (Subchapter C)  Added.....................................26167
613  Added.........................................................26167
614  Added.........................................................26168
614.102-70  Corrected..............................................36461
615  Added.........................................................26168
616  Added.........................................................26169
616.603-2  Corrected...............................................36462
616.603-70  Corrected..............................................36461
617  Added.........................................................26169
619--625 (Subchapter D)  Added.....................................26170
619  Added.........................................................26170
622--625  Added....................................................26172
628--633 (Subchapter E)  Added.....................................26173
628--630  Added....................................................26173
632  Added.........................................................26173
633  Added.........................................................26173
634--637 (Subchapter F)  Added.....................................26175
634  Added.........................................................26175
634.001-70  Corrected..............................................36462
636  Added.........................................................26175
637  Added.........................................................26176
642--648 (Subchapter G)  Added.....................................26176
642  Added.........................................................26176
643  Added.........................................................26176
645  Added.........................................................26177
646  Added.........................................................26177
648  Added.........................................................26177
652--653 (Subchapter H)  Added.....................................26177
652  Added.........................................................26177
652.202-70  Corrected..............................................36462
652.242-72  Corrected..............................................36462
653  Added.........................................................26180
670 (Subchapter I and Part)  Added.................................26188
670.102  (b)(3) corrected..........................................36462

                                  1989

48 CFR
                                                                   54 FR
                                                                    Page
Chapter 3
301.102  Amended...................................................24342
301.201  (a) and (b) amended.......................................24342
301.270  (a) and (b) amended.......................................24342
301.304  (a), (c), and (d) amended.................................24342
301.403  Amended...................................................24342
301.404  Amended...................................................24342
301.470  Amended...................................................24342
301.670-2  (a) removed; (b) and (c) redesignated as (a) and (b); 
        new (a) heading amended....................................24342
302.100  Amended............................................24342, 43965
303.104  Added.....................................................31528
303.104-4  Added; interim..........................................31528
303.104-5  Added; interim..........................................31528
303.104-6  Added; interim..........................................31529
303.104-9  Added; interim..........................................31529
303.104-11  Added; interim.........................................31529
303.104-12  Added; interim.........................................31529
303.303  Amended...................................................24342
303.409  (b)(4) amended............................................24342
303.502  (b) amended...............................................24342
304.870  (c)(4) amended............................................24342
    (c)(5) amended.................................................43965
304.7001  (b)(1), (c) and (d) amended..............................24342
304.7101  (c) amended..............................................24342
305.202  (b) amended...............................................24342
306.501  Amended...................................................24342
307.7003  (b)(2) amended...........................................24342
307.7004  (c) amended..............................................24342
307.7102  (e) amended..............................................24342
309.403  Amended............................................24342, 43965
309.404  (c) amended........................................24342, 43965
309.470-1  Amended.................................................24342
314.406-3  (e) and (g)(3) amended..................................24342
314.406-4  (c) amended.............................................24342
315.406-2  (a)(3) amended..........................................24342
315.406-5  (a)(2) (xiv) and (xv) amended; (xvi) removed; new (iii) 
        added; (iii) through (xv) redesignated as (iv) through 
        (xvi)......................................................24342
    (a)(2) amended.................................................43966

[[Page 610]]

315.407  (i) added.................................................43966
316.702  (d)(2), (f) (1), and (4) amended..........................24342
317.7002  (b) (1) through (3) amended..............................24342
319.201-70  (a) amended............................................24342
322.604-2  (c)(1) amended..........................................24342
324.2  Revised.....................................................24342
330.2  Added.......................................................24344
330.3  Removed.....................................................24344
332.905  Revised...................................................43966
333.102  (c) (1) and (3) amended...................................24344
333.103  (a) amended...............................................24344
333.104  (a)(6), (b) (1), (2), (c)(2), and (f) amended.............24344
333.213  (a) amended...............................................24344
335.070-4  (c) (1) and (2) amended.................................24344
342.7002  (e) added................................................43966
    (e) corrected..................................................47750
352.215-71  Removed................................................24344
352.242-80  Removed................................................43966
352.370  (b) amended...............................................24344
    (a), (b), and (c) redesignated as (c), (d), and (e); new (a) 
and (b) added; new (c) amended; new (e) revised; clauses revised 
                                                                   26751
Chapter 5
501--570 (Chapter 5)  Revised......................................26486
501.602-3  Added....................................................9050
501.670-1  Revised.................................................13887
501.670-2  Revised.................................................13887
501.670-3  Revised.................................................13888
501.670-4  Revised.................................................13888
501.670-5  Revised.................................................13889
501.670-6  Revised.................................................13889
501.675--501.675-3  Removed.........................................9050
501.707  Table 501-1 amended.......................................51885
502.101  Corrected.................................................40059
503.104  Temporary Reg. AC-89-2 added..............................29721
    Temporary Reg. AC-89-2 removed.................................51745
503.104-4  Temporary Reg. AC-89-2 added............................29721
    Temporary Reg. AC-89-2 removed.................................51745
503.104-5  Temporary Reg. AC-89-2 added............................29721
    Temporary Reg. AC-89-2 removed.................................51745
503.104-9  Temporary Reg. AC-89-2 added............................29722
    Temporary Reg. AC-89-2 removed.................................51745
503.104-10  Temporary Reg. AC-89-2 added...........................29722
    Temporary Reg. AC-89-2 removed.................................51745
503.104-11  Temporary Reg. AC-89-2 added...........................29722
    Temporary Reg. AC-89-2 removed.................................51745
503.104-12  Temporary Reg. AC-89-2 added...........................29722
    Temporary Reg. AC-89-2 removed.................................51745
504.803  (a)(23) corrected.........................................40060
505.301  Removed...................................................10149
505.302  Removed...................................................10149
505.303  Revised...................................................10149
505.303-70  (b)(3)(iii) revised....................................40060
    Temporary Reg. AC-89-2 removed.................................51745
    Revised........................................................10149
    Temporary Reg. AC-89-2; (b)(2) revised; (b)(4) and (c) removed
                                                                   29722
505.403  Revised...................................................10150
    Revised (temporary)............................................29722
    Temporary Reg. AC-89-2 removed.................................51745
509.407-3  (b)(6)(iii) revised.....................................40060
512.104  (d) and (e) revised.......................................11955
514.201-2  Revised..................................................9050
515.406-2  Removed.................................................51885
519.704  (c)(2) revised............................................40060
525.402  Temporary Reg. AC-89-3 added..............................33554
532.70  Temporary Reg. AC-89-1 added...............................14235
532.111  (b), (c), (d) (2) and (3), and (e) removed; (d)(1), (f), 
        and (g) redesignated as (b), (c), and (d); new (b) revised
                                                                    9050
    Temporary Reg. AC-89-1 added...................................14235
532.232-8  Temporary Reg. AC-89-1 added............................14235
532.232-70  Temporary Reg. AC-89-1 added...........................14235
532.232-71  Temporary Reg. AC-89-1 added...........................14235
532.232-73  Temporary Reg. AC-89-1 added...........................14235
532.232-75  Temporary Reg. AC-89-1 added...........................14235
532.232-76  Temporary Reg. AC-89-1 added...........................14235

[[Page 611]]

532.905--532.908 (Subpart 532.9)  Added.............................9050
532.905  Temporary Reg. AC-89-1 added..............................14235
532.905-70  Temporary Reg. AC-89-1 added...........................14235
532.905-71  Temporary Reg. AC-89-1 added...........................14235
532.908  Temporary Reg. AC-89-1 added..............................14235
532.7000  Removed...................................................9051
532.7001--532.7003 (Subpart 532.70)  Added.........................43180
532.7002  Removed...................................................9051
532.7004  Removed...................................................9051
536.203  (c) revised...............................................51886
542.1107  (c) removed..............................................11955
546.301  Removed...................................................11955
546.302  Revised...................................................11955
546.302-70  Revised................................................11955
546.302-71  Revised................................................11956
546.302-72  Removed................................................11956
546.316  Removed...................................................11956
546.316-70  Removed................................................11956
552.203-8  Added (temporary).......................................29722
552.203-8  (Temporary Reg. AC-89-2) removed........................51745
552.203-10  Added (temporary)......................................29722
    Temporary Reg. AC-89-2 removed.................................51745
552.203-71  Added (temporary)......................................29723
    Temporary Reg. AC-89-2 removed.................................51745
552.210-79  Revised................................................43180
552.212-1  (b) amended.............................................51886
552.212-72  Revised................................................11956
    Introductory text revised......................................40060
552.215-75  (c) revised............................................40060
    Removed........................................................51886
552.216-71  Amended.................................................6932
552.219-71  Introductory text revised..............................40060
552.219-72  Heading and provision heading revised..................40060
552.225-70  Amended................................................40060
552.228-75  Introductory text revised..............................40060
552.232-8  Temporary Reg. AC-89-1 added............................14235
552.232-70  Revised.................................................9051
552.232-70  Temporary Reg. AC-89-1 added...........................14235
552.232-71  Revised.................................................9051
552.232-71  Temporary Reg. AC-89-1 added...........................14235
552.232-72  Revised.................................................9052
552.232-73  Removed.................................................9052
    Temporary Reg. AC-89-1 added...................................14235
552.232-75  Introductory text revised...............................9052
    Temporary Reg. AC-89-1 removed.................................14235
552.232-76  Introductory text revised...............................9052
    Temporary Reg. AC-89-1 removed.................................14235
552.232-78  Introductory text amended...............................9052
    (c) amended....................................................40060
552.232-79  Introductory text amended...............................9052
552.232-80  Added..................................................43181
552.236-73  Amended................................................40061
552.237-72  (a) revised............................................40060
552.242-70  Revised................................................11956
552.242-72  Removed................................................11956
552.246-17  (c)(7) revised.........................................40061
552.246-70  Revised................................................11956
552.246-72  Removed; new 552.246-72 redesignated from 552.246-73 
        and revised................................................11957
552.246-73  Redesignated as 552.246-72 and revised.................11957
552.246-74  Removed................................................11958
552.246-77  Removed................................................11958
552.249-70  (b) revised............................................40061
553.370-2419  Revised..............................................14237
553.370-2932  Removed..............................................10150
553.370-3501  GSA Form 3501 availability............................3605
570.208-3  Temporary Reg. AC-89-4 added; eff. 11-30-90.............49090
    Revised; eff. 11-30-90.........................................49090
570.501  Temporary Reg. AC-89-4 added; eff. 11-30-90...............49090
    (d) revised; eff. 11-30-90.....................................49090
570.602  (c) revised...............................................40061
Chapter 5  Appendix A availability..................................3605

                                  1990

48 CFR
                                                                   55 FR
                                                                    Page
Chapter 3
302.100  Amended...................................................13536
303.104  Suspended; eff. to 11-30-90................................2078
303.104-4  Suspended; eff. to 11-30-90..............................2078

[[Page 612]]

303.104-5  Suspended; eff. to 11-30-90..............................2078
303.104-6  Suspended; eff. to 11-30-90..............................2078
303.104-9  Suspended; eff. to 11-30-90..............................2078
303.104-11  Suspended; eff. to 11-30-90.............................2078
303.104-12  Suspended; eff. to 11-30-90.............................2078
306.501  Amended...................................................42197
314.202-7--314.213 (Subpart 314.2)  Added..........................13536
315.402  Added.....................................................13536
315.471  Added.....................................................13536
316.307  Added.....................................................42197
317.7002  (b)(3) amended...........................................13536
319.800--319.870 (Subpart 319.8)  Revised..........................13536
332.402  (e) amended...............................................42197
332.406  (c)(2) amended............................................42197
332.407  (d) introductory text amended.............................42197
332.409-1  Amended.................................................42197
332.501-2  (a)(3) amended..........................................42197
333.104  (b)(1) and (c)(2) amended.................................42197
352.216-7  Removed.................................................42197
352.216-71  Removed................................................42197
352.216-72  Added..................................................42197
352.370 (Subpart 352.3)  Removed...................................42198
Chapter 4
415.413  Added......................................................7334
Chapter 5
501.105  Amended...................................................48847
501.602-1  Temporary Reg. AC-90-1 added; (i) revised; (k), (l), 
        and (m) added..............................................13277
501.603-3  Temporary Reg. AC-90-1 (a) revised......................13278
501.603-70  Temporary Reg. AC-90-1 (c) amended; (d)(2), (4), (f), 
        and (h)(6) revised; (h)(1)(ix) added.......................13278
501.707  Table 501-1 amended.......................................37879
502.101  Amended...................................................48847
503.104  Added.....................................................39972
503.104-4  Added...................................................39972
503.104-5  Added...................................................39972
    (c)(4) revised.................................................50700
503.104-7  Added...................................................39973
    (a) revised....................................................50700
503.104-8  Added...................................................39973
503.104-9  Added...................................................39973
503.104-10  Added..................................................39973
503.104-11  Added..................................................39974
503.104-12  Added..................................................39974
503.804--503.806 (Subpart 503.8)  Added............................29580
504.203  Added......................................................8954
504.803  (a) (23) and (25) revised.................................39974
505.303-70  (b)(2) revised; (b)(4) and (c) added...................39974
505.403  Added.....................................................39974
506.302-1  Revised.................................................48847
506.304  Revised...................................................48847
507.102  Revised...................................................28631
507.104  (a) and (d) revised.......................................28631
507.105  (a)(3) and (b) revised....................................28631
509.405  Revised...................................................37880
513.106  (a) revised...............................................48847
513.107  Removed...................................................48847
513.505-70  (a) revised............................................20458
    (b) revised; (c) added.........................................48847
513.7001  (g) amended..............................................48847
514.201-70  (c) revised............................................20458
514.202-7  Added...................................................20458
514.213  Added.....................................................20458
514.301-70  Removed................................................20458
515.402  (c) added.................................................20458
515.414  Revised...................................................48847
515.414-70  (c) revised............................................20458
    (d) revised....................................................48847
515.501  Revised...................................................20458
    Revised........................................................48848
515.612  Added.....................................................39974
515.803  Revised...................................................48848
515.905  (c) added.................................................48848
515.905-1  (a) revised.............................................48848
516.203-4  Revised.................................................39278
516.301-3  Revised.................................................39279
517.208  Added.....................................................39279
522.1001  Revised..................................................37880
522.1003-3  Added..................................................37880
522.1003-4  Revised................................................37880
522.1003-7  Revised................................................37880
522.1011-2  Revised................................................37880
522.1021  Revised..................................................37880
522.1403  Revised..................................................37880
525.402  Temp. Reg. AC-89-5..........................................421
    (a) revised.....................................................6256
    (b) and (c) revised............................................32635
    Temp. Reg. AC-90-2.............................................46069
525.406  Added.....................................................38552
525.407  Temp. Reg. AC-90-2........................................46069
525.1003--525.1004 (Subpart 525.10)  Added.........................37880
528.101-4  Removed..................................................5223

[[Page 613]]

528.103-2  (c) and (d) revised......................................5223
    Technical correction............................................7967
528.103-3  (b) and (c) revised......................................5223
    Heading corrected...............................................7967
528.106-1  Added....................................................5223
528.202  Revised....................................................5223
528.202-1  Removed..................................................5223
528.202-2  Removed..................................................5223
528.202-70  Revised.................................................5223
528.202-71  Removed.................................................5223
528.203  Revised....................................................5223
528.203-7  Added....................................................5223
528.204  Added......................................................5224
528.270  Removed....................................................5224
545.302-1 (Subpart 545.3)  Added....................................8954
552.203-5  (b) amended..............................................6256
552.203-71  Added..................................................39974
552.203-72  Added..................................................39975
    Amended........................................................50701
552.203-73  Added..................................................39975
552.209-74  Revised.................................................8954
552.216-72  Added..................................................39279
552.217-70  Added..................................................39280
552.219-1  Revised..................................................8954
552.225-8  Temp. Reg. AC-90-2......................................46069
552.225-9  Temp. Reg. AC-90-2......................................46069
552.228-72  Revised.................................................5224
    (b) amended.....................................................9887
552.228-73  Revised.................................................5224
552.228-74  Removed.................................................5224
552.229-72  Revised.................................................6256
570.208-2  (a) and (e) revised.....................................11588
570.208-3  Revised.................................................11588
570.208-5  (b) revised.............................................11588
570.501  (d) revised...............................................11588
Chapter 6
601.602-1  (c) amended..............................................5774
605.404--605.404-1 (Subpart 605.4)  Added...........................5774
607  Added..........................................................5774
608.302 (Subpart 608.3)  Added......................................5774
609.404  Heading revised............................................5774
622.302 (Subpart 622.3)  Added......................................5774
622.404--622.406-12 (Subpart 622.4)  Added..........................5774
622.1308  Added.....................................................5775
622.1408  Added.....................................................5775
623  Heading revised................................................5775
623.506 (Subpart 623.5)  Added......................................5775
625.901 (Subpart 625.9)  Revised....................................5775
625.1003 (Subpart 625.10)  Added....................................5775
632.903 (Subpart 632.9)  Added......................................5775
636.602  Revised....................................................5775
637.110  Added......................................................5775
648.102  Revised....................................................5775
648.201 (Subpart 648.2)  Added......................................5775
653.107  Removed....................................................5775

                                  1991

48 CFR
                                                                   56 FR
                                                                    Page
Chapter 3
302.100  Amended...................................................47002
304.870  (c)(1) and (2) amended....................................47002
306.304  (a)(1) amended............................................47002
307.170  (a)(1), (2) and (b) amended...............................47002
307.170-1  (a)(1), (2), (b)(1) and (2) amended.....................47002
307.170-2  (a)(1), (2) and (b) amended; (a)(3) added...............47002
313.106  (a), (b) introductory text, (4)(i)(D), (c) introductory 
        text and (2) amended.......................................47002
313.107  (d) redesignated as (e)...................................47003
313.204  (e) redesignated as (e)(5) and amended....................47003
315.406-5  (b)(3)(ii)(c) redesignated as (b)(3)(ii)(C) and amended
                                                                   47003
315.905-71  (d) amended............................................47003
315.7002  (a) amended..............................................47003
328  Added.........................................................58316
333.102  (c) redesignated as (d)...................................47003
333.103  (a) redesignated as (a)(2); (b)(1) designation removed 
        and text transferred to (b) introductory text; (b) 
        introductory text and (2) redesignated as (a)(3) and (4); 
        new (a)(3) amended.........................................47003
333.104  (a)(2) through (6) redesignated as (a)(3) through (7); 
        new (a)(3)(vii), (viii), (4), (5), (6)(i) and (c)(6) 
        amended; (f) and (h) redesignated as (g) and (i); new (g) 
        and (i) amended............................................47003
333.105  (b)(10) amended...........................................47003
352.228-7  Added...................................................58316
352.228-70  Removed................................................58317
352.252-2  Removed.................................................47003
352.270-6  Added; interim..........................................33882
    Technical correction...........................................37668
    Regulation at 56 FR 33882 confirmed; (a) amended...............54797

[[Page 614]]

    Corrected......................................................57602
Chapter 5
501.105  Revised (OMB numbers).....................................64213
501.404  (c) revised...............................................15288
501.602-1  (i) revised; (k) through (m) added......................15288
501.602-2  (a) and (b)(1) revised; (c) amended.....................15288
501.603-3  Revised.................................................15288
501.603-4  Revised.................................................15288
501.603-70  (a), (d)(2) through (4), (h)(1) introductory text, 
        (iv)(C), (v), (vi)(C), (E), (vii) through (ix) and (h)(2) 
        through (4) revised; (c) and (f) amended; (h)(1)(x) and 
        (i) added; (h)(5) and (6) removed..........................15289
501.670-4  (a) introductory text, (4), (5), (26), (d) introductory 
        text and (1) through (4) revised...........................47004
502.101  Amended...................................................47004
504.470  Revised...................................................47004
504.470-1  Revised.................................................47004
504.470-2  Revised.................................................47004
504.471  (b) revised...............................................47005
504.476  Revised...................................................47005
507.103  Added......................................................2864
508.602  Removed...................................................33721
509.405  Revised...................................................51660
509.406-3  (b)(9) revised..........................................47005
510.001  Revised....................................................2864
510.002  Added......................................................2865
    Revised........................................................33721
513.7001  (g) revised..............................................47005
514.203-1  (a) revised.............................................47005
514.404-2  (a) revised.............................................47005
515.407  Removed...................................................47006
515.408  Added.....................................................47005
515.411  (b) revised...............................................47005
515.1001  Added....................................................47005
515.1070  (a) revised..............................................47005
516.505 (Subpart 516.5)  Added.......................................376
519.201  Added.....................................................26769
    Corrected......................................................30618
519.202-2  (b)(4) added.............................................3044
519.202-5  (b) revised..............................................3044
519.302  Revised....................................................3044
519.304  Revised...................................................47006
519.500  Revised....................................................3044
519.704  (a)(2) and (3) revised.....................................3044
    (c)(2) revised.................................................59220
519.705-2  Revised.................................................64213
519.705-4  (d) redesignated as (f); (c) and new (f)(1) revised; 
        new (d) and (e) added.......................................3044
    (d) revised; (e) removed; (f)(1) through (3) redesignated as 
(e)(1) through (3) and revised.....................................26922
    (a) revised....................................................59220
    (a)(5) revised.................................................64214
519.705-5  (c) and (d) amended......................................3044
519.706-70  Revised.................................................3045
    (e) revised....................................................26922
    (f)(2)(iii) revised............................................64214
519.708  Revised...................................................64214
519.770-1  (a)(2), (b)(1)(ii), (iii) and (2)(ii) revised............3045
519.803--519.803-70 (Subpart 519.8)  Added.........................26769
523.303  Revised....................................................1740
524.202  Revised...................................................47006
525  Temporary Reg. AC-90-2, Supp. 1 added.........................52479
533.103  Revised...................................................47006
538.000  Revised...................................................29443
538.203-71  Revised................................................29443
546.710  (a) revised................................................1741
547.303-6  Removed.................................................47006
549.001  Removed...................................................33722
549.402-6  (c) revised.............................................33722
549.402-7  (a) and (b)(2) revised..................................33722
552  Temporary Reg. AC-90-2, Supp. 1 added.........................52479
552.203-70  Revised..................................................965
552.215-73  Removed................................................47006
552.215-74  Removed................................................47006
552.216-73  Added....................................................376
552.219-1  Amended.................................................47006
552.219-70  Removed................................................47007
552.219-72  Introductory text revised..............................64214
552.219-73  Added..................................................64214
552.223-70  Introductory text revised...............................1741
552.223-72  Added...................................................1741
552.225-9  Corrected.................................................377
552.225-72  Temp. Reg. AC-91-2.....................................11692
552.238-70  Added..................................................29443
    Amended........................................................51660
552.242-70  Revised.................................................1741
552.246-17  Revised.................................................1741
552.246-70  Revised.................................................1742
552.246-72  Revised.................................................1744
552.247-34  Removed................................................47007
570.702-1  Temp. Reg. AC-91-1.......................................4735

[[Page 615]]

570.702-2  Temp. Reg. AC-91-1.......................................4735
570.702-5  Temp. Reg. AC-91-1.......................................4735
570.702-11  Temp. Reg. AC-91-1......................................4735
570.702-14  Temp. Reg. AC-91-1......................................4735
570.702-15  Temp. Reg. AC-91-1......................................4735
570.702-17  Temp. Reg. AC-91-1......................................4735
570.702-18  Temp. Reg. AC-91-1......................................4735
570.702-19  Temp. Reg. AC-91-1......................................4735
570.702-21  Temp. Reg. AC-91-1......................................4735

                                  1992

48 CFR
                                                                   57 FR
                                                                    Page
Chapter 3
305.303  (a) amended...............................................11689
306.303-1  (g)(1) and (2) amended..................................11689
306.302-1  (b)(4)(i) designation removed; (b)(4)(ii) redesignated 
        as (c) and amended.........................................11689
313.105  Revised...................................................11689
315.407  (h) and (i) redesignated as (g) and (n)...................11690
319.201-70  (d)(3) amended.........................................11690
319.501  Revised...................................................11690
319.505  Amended...................................................11690
319.705-3  Amended.................................................11690
319.705-4  (c) removed.............................................11690
332.702  (a) revised...............................................35473
333.103  (a)(4) amended............................................35473
Chapter 5
501.103  (b) revised...............................................37889
501.105    Revised (OMB numbers)...................................14648
501.170-1  Revised.................................................14649
501.603-70  (h)(1)(ii) and (v) revised.............................14649
    (h)(1)(iv)(K) revised..........................................61583
501.670-4  (a)(3) revised..........................................61583
502.101  Revised....................................................9213
    Amended........................................................61583
503.104-10  (a) and (b) revised....................................37889
503.404  (a) revised...............................................37889
504.201  Revised...................................................61583
504.803  (a)(23) revised...........................................61584
505.101  (c)(2) revised............................................37889
505.203  (b) revised...............................................37890
508.304-5  Revised.................................................61584
508.371  Removed...................................................61584
510.011  (j) added.................................................61584
513.505-2  (c) revised..............................................7555
513.7001  (a), (b)(1) and (g) revised..............................26609
514.406-3  Revised.................................................14649
515.406-1  (a) revised.............................................61584
515.414-70  (b) revised............................................61584
515.804-3  Temporary Reg. AC-92-1 paragraph (c) added...............5864
515.804-70  Temporary Reg. AC-92-1 added............................5864
517.200  Added.....................................................59939
517.201  Removed...................................................59939
517.202  Added.....................................................59939
517.203  Added.....................................................59939
517.204  Revised...................................................59939
517.207  Revised...................................................59939
517.208  Revised...................................................59939
519.202-5  Revised.................................................37890
519.304  Revised...................................................37890
519.708  (a) revised...............................................37890
522.000  Added......................................................7555
522.001  Added......................................................7555
522.101-1  Revised..................................................7556
522.101-3  Added....................................................7556
522.103-5  Added....................................................7556
522.406-13  Revised.................................................7556
522.807  Revised....................................................7556
522.1001  Removed...................................................7556
522.1003-4  Revised.................................................7556
522.1003-7  Revised.................................................7556
522.1006  (b) and (c) revised......................................22666
522.1013  Added.....................................................7556
522.1014  Added.....................................................7556
522.1021  Revised...................................................7556
522.1303  Revised...................................................7556
522.1403  Revised...................................................7556
525.402  (a) revised.................................................648
    (b) revised....................................................42708
525.407  Revised...................................................42708
530.201-5  Revised.................................................61584
530.470 (Subpart 530.4)  Added.....................................61584
532.502-3  Removed.................................................14649
532.908  (c) revised...............................................37890
533.104  (c) revised...............................................61584
538.203-70  Temporary Reg. AC-92-1 added............................5867
552  Temporary Reg. AC-91-2; Supp. 1 added.........................21041
552.217-71  Added..................................................59939
552.222-43  Revised................................................22666
552.270-10  Corrected..............................................52826
552.270-28  Corrected..............................................52826
552.270-37  Corrected..............................................52826
552.223-72  Amended................................................14649
552.225-8  Added...................................................42709
552.225-9  Added...................................................42709
552.225-72  Revised................................................42709
552.232-73  Revised................................................37890
552.232-74  Removed................................................14649

[[Page 616]]

552.242-70  Revised................................................26609
552.270-3  Revised.................................................23163
552.270-6  Revised.................................................37890
552.270-10  Revised................................................37890
552.270-11  Revised................................................37891
552.270-12  Revised................................................37891
552.270-13  Revised................................................37891
552.270-14  Reserved...............................................37891
552.270-15  Revised................................................37891
552.270-16  Revised................................................37891
552.270-17  Revised................................................37891
552.270-18  Revised................................................37892
552.270-20  Revised................................................37892
552.270-21  Revised................................................37892
552.270-22  Revised................................................37892
552.270-24  Revised................................................37892
552.270-26  Reserved...............................................37893
552.270-27  Revised................................................37893
552.270-28  Revised................................................37893
552.270-29  Reserved...............................................37893
552.270-30  Revised................................................37893
552.270-31  Added..................................................37893
552.270-32  Added..................................................37893
552.270-33  Added..................................................37893
552.270-34  Added..................................................37894
552.270-35  Added..................................................37894
552.270-36  Added..................................................37894
552.270-37  Added..................................................37894
552.270-38  Added..................................................37894
552.270-39  Added..................................................37894
552.270-40  Added..................................................37894
570.201--570.210 (Subpart 570.2)  Heading revised..................37895
570.202  (a) revised...............................................37895
570.203  (a)(5), (8) and (9) revised; (a)(10) added................37895
    (a)(8)(vii) table and (9) corrected............................52826
570.204  (c)(3) revised............................................37895
570.206  (b) revised...............................................37895
570.208-1  (b) revised.............................................37896
570.208-3  (b)(5) added............................................37896
570.208-5  Revised.................................................37896
570.301--570.304-6 (Subpart 570.3)  Heading revised................37896
570.301  Revised...................................................37896
570.302  Revised...................................................37896
570.303  Revised...................................................37896
    Corrected......................................................52826
570.304  Revised...................................................37896
570.304-1  (b) revised.............................................37896
570.304-2  Revised.................................................37896
570.304-3  Revised.................................................37896
570.304-4  Revised.................................................37896
570.304-5  Revised.................................................37897
570.502  (a), (b)(1) and (3)(i) revised............................37897
570.503  (b) and (c) revised.......................................37897
570.504  (a) revised...............................................37897
570.602-2  (f)(3) revised..........................................37897
570.701-1  Revised.................................................37897
570.701-2  Revised.................................................37897
570.701-3  Revised.................................................37897
570.701-4  Revised.................................................37898
570.701-5  Revised.................................................37898
570.701-6  Revised.................................................37898
570.702-1  Temp. Reg. AC-91-1, Supp. 1 added........................4939
    Revised........................................................37898
570.702-2  Temp. Reg. AC-91-1, Supp. 1 added........................4939
    Revised........................................................37898
570.702-3  Revised.................................................37898
570.702-4  Revised.................................................37898
570.702-5  Temp. Reg. AC-91-1, Supp. 1 added........................4939
    Removed........................................................37898
570.702-6  Revised.................................................37898
570.702-7  Revised.................................................37898
570.702-8  Revised.................................................37898
570.702-9  Revised.................................................37898
570.702-10  Revised................................................37898
570.702-11  Temp. Reg. AC-91-1, Supp. 1 added.......................4939
    Revised........................................................37898
570.702-12  Revised................................................37898
570.702-14  Temp. Reg. AC-91-1, Supp. 1 added.......................4939
    Revised........................................................37898
570.702-15  Temp. Reg. AC-91-1, Supp. 1 added.......................4939
    Revised........................................................37899
570.702-16  Revised................................................37899
570.702-17  Temp. Reg. AC-91-1, Supp. 1 added.......................4939
    Removed........................................................37899
570.702-18  Temp. Reg. AC-91-1, Supp. 1 added.......................4939
    Revised........................................................37899
570.702-19  Temp. Reg. AC-91-1, Supp. 1 added.......................4939
    Revised........................................................37899
570.702-20  Removed................................................37899
570.702-21  Temp. Reg. AC-91-1, Supp. 1 added.......................4939
    Revised........................................................37899
570.702-22  Added..................................................37899
570.702-23  Added..................................................37899
570.702-24  Added..................................................37899
570.702-25  Added..................................................37899

[[Page 617]]

570.702-26  Added..................................................37899
570.702-27  Added..................................................37899
570.702-28  Added..................................................37899
570.702-29  Added..................................................37899
570.702-30  Added..................................................37900
    Heading corrected..............................................52826
570.702-31  Added..................................................37900
570.801  Revised...................................................37900
570.802  Revised...................................................37900

                                  1993

48 CFR
                                                                   58 FR
                                                                    Page
Chapter 5
501.105  Amended...................................................52443
501.603-3  Revised.................................................58284
501.603-4  Revised.................................................58284
501.603-70  (c) and (f) amended; (d)(1), (2), (4), (h)(1)(i), (4), 
        (i)(1), (2) and (3) revised................................58284
    (h)(1)(v) revised..............................................64694
501.670  Removed...................................................52443
501.670-1  Removed.................................................52443
501.670-2  Removed.................................................52443
501.670-3  Removed.................................................52443
501.670-4  Removed.................................................52443
501.670-5  Removed.................................................52443
501.670-6  Removed.................................................52443
501.704-70  (b)(2) removed.........................................52443
503.104-8  Revised.................................................52443
507.305  Removed...................................................52443
508.307-1  Revised.................................................52443
508.705-72  Removed................................................52443
509.106-1  Removed.................................................52443
509.106-2  Revised.................................................64694
509.405  Removed...................................................52443
509.406-3  (b)(6) through (9) redesignated as (b)(7) through (10); 
        new (b)(6) added...........................................26920
509.407-3  (b)(5) and (6) redesignated as (b)(6) and (7) and 
        revised; new (b)(5) added..................................26920
    (b)(7)(iii) corrected..........................................29254
511.001  Removed...................................................52443
514.201-72  Removed................................................52443
514.208  Removed...................................................52443
514.402-1  (i) revised.............................................52443
514.404-1  (b) revised.............................................52443
514.407-2  Removed.................................................52443
515.170  Removed...................................................52443
515.402  Revised...................................................52443
515.403  Removed...................................................52443
515.405-1  Revised.................................................52443
515.414-70  (a) revised............................................52443
515.506-1  Removed.................................................52443
519.705-5  (d) revised.............................................52444
519.705-6  (a) revised; (c) removed................................52444
519.770-1  (b)(2)(i) revised.......................................52444
519.770-3  (a) revised.............................................52444
522.1006  Revised..................................................47398
522.407  Removed...................................................52444
525.203  Revised; eff. 1-1-94 through 12-31-94.....................69243
525.205  Revised; eff. 1-1-94 through 12-31-94.....................69244
525.402  (a) amended; eff. 1-1-94 through 12-31-94.................69244
525.1003--525.1004 (Subpart 525.10)  Removed.......................52444
528.102-3  Removed.................................................52444
528.106-70  Removed................................................52444
528.202  Revised...................................................52444
529.401-70  Revised................................................52444
529.401-71  Removed................................................52444
532.803  Removed...................................................52444
536.201  Revised...................................................52445
536.203  Revised...................................................52445
536.206  Removed...................................................52445
536.303  Removed...................................................52445
536.303-70  Revised................................................52445
536.303-71  (g) removed............................................52445
536.303-72  (c) removed; (d) redesignated as (c)...................52445
538.203-71  (c) added..............................................54524
542.302  (c) removed; (d) redesignated as (c)......................52445
543.202  Revised...................................................52445
552.207-70  Removed................................................52445
552.222-43  Corrected; CFR correction...............................8235
    Removed........................................................47399
552.222-82  Removed................................................52445
552.225-8  Revised; eff. 1-1-94 through 12-31-94...................69244
552.225-9  Revised; eff. 1-1-94 through 12-31-94...................69244
552.225-75  Revised; eff. 1-1-94 through 12-31-94..................69245
552.228-70  Introductory text revised..............................52446
552.238-74  Added..................................................54524
552.246-70  Amended................................................64694
570.208-1  (c) removed.............................................52446

[[Page 618]]

                                  1994

48 CFR
                                                                   59 FR
                                                                    Page
Chapter 5
501.105  Revised (OMB numbers).....................................63260
516.505  Revised...................................................32384
519.701  Removed...................................................38933
519.702  Removed...................................................38933
519.704  Removed...................................................38933
519.705-2  Revised.................................................38933
519.705-4  Removed.................................................38933
519.705-5  Removed.................................................38933
519.705-6  Removed.................................................38933
519.706  Removed...................................................38933
519.706-70  Removed................................................38933
519.708  Revised...................................................38933
519.770  Removed...................................................38934
519.770-1  Removed.................................................38934
519.770-3  Removed.................................................38934
519.803-70  Revised................................................38934
525.203  Corrected..................................................5484
    Revised........................................................64856
525.205  Revised...................................................64857
525.402  (a) revised...............................................64857
533.105  (a)(1)(iii), (2) and (4) revised..........................22520
    (a)(4) corrected...............................................29480
533.7103-1  (b)(1) and (4) revised.................................22520
    Correctly designated...........................................29480
538.203-71  (d) added; interim......................................3657
    Heading revised; (e) added.....................................52451
    (d) revised....................................................63260
538.272  Added.....................................................52451
552  Technical correction...........................................5484
552.216-73  Revised................................................32384
552.216-74  Added..................................................32385
552.219-9  Added...................................................38934
552.219-16  Added..................................................38935
    Correctly designated...........................................45063
552.219-72  Revised................................................38936
552.219-73  Revised................................................38936
552.219-74  Added..................................................38936
    Corrected......................................................45063
552.225-8  Revised.................................................64857
552.225-9  Revised.................................................64857
552.225-72  Amended................................................64858
552.225-75  Revised................................................64858
552.238-75  Added...................................................3657
    Revised........................................................63260
552.238-76  Added..................................................52452
552.246-70  Amended................................................15134
552.270-4  Amended.................................................52253
552.270-21  Amended................................................52253
552.270-25  Amended................................................52253
552.270-28  Amended................................................52253
552.270-31  Revised................................................52253
552.270-41  Added..................................................52253
570.203  (a)(8)(vi) revised........................................38937
570.702-22  Revised................................................52254
570.702-32  Added..................................................52254
Chapter 6
601  Authority citation revised....................................66750
601.000  Amended...................................................66750
601.101--601.105 (Subpart 601.1)  Added............................66750
601.201-1  Amended.................................................66750
601.301  Revised...................................................66751
601.302  (a) amended...............................................66751
601.303  (c) revised...............................................66751
601.403  Amended...................................................66751
601.404  Amended...................................................66751
601.405  Amended...................................................66751
601.470  Amended...................................................66751
601.471  (a) introductory text amended; (a)(1) and (b) revised.....66751
601.570  Revised...................................................66751
601.602-1  (a) and (b) amended.....................................66751
601.602-3  (b)(1) and (c) amended; (b)(2) revised..................66751
601.602-3-70  Revised..............................................66751
601.603-3  Revised.................................................66752
601.603-70  Revised................................................66752
601.670  Added.....................................................66753
602  Authority citation revised....................................66750
602.101-70  Amended................................................66753
602.201--602.201-70 (Subpart 602.2)  Removed.......................66753
603  Authority citation revised....................................66750
603.104--603.104-11 (Subpart 603.1)  Added.........................66753
603.203  Amended...................................................66754
603.303  (c) amended...............................................66754
603.601  Added.....................................................66754
603.670  Added.....................................................66754
603.704--603.705 (Subpart 603.7)  Added............................66754
604  Authority citation revised....................................66750
604.202  Amended...................................................66754
604.7002  (a) and (b) revised; (c) amended.........................66754
605  Authority citation revised....................................66750
605.202-70  (a), (c)(1) and (2) introductory text amended; (b), 
        (c)(2)(i), (ii) and (d) revised; (e) added.................66754

[[Page 619]]

605.207  (a)(1) added..............................................66755
605.303 (Subpart 605.3)  Added.....................................66755
605.403  Added.....................................................66755
605.502  Revised...................................................66755
606  Authority citation revised....................................66750
606.101-70  Amended................................................66755
606.302-1  Added...................................................66755
606.302-4  Added...................................................66755
606.302-6  Added...................................................66755
606.303-1  Amended.................................................66755
606.304  (a)(2) and (d) added......................................66755
606.304-70  Revised................................................66756
606.370  Added.....................................................66756
606.501  Revised...................................................66756
606.570  Added.....................................................66756
608  Authority citation revised....................................66750
608.402--608.402-70 (Subpart 608.4)  Removed.......................66756
609  Authority citation revised....................................66750
609.202  Amended...................................................66756
609.404  Amended...................................................66756
609.405  Revised...................................................66756
609.405-70  (c) removed; introductory text, (a) and (b) 
        redesignated as (a), (b) and (c); new (a) revised..........66756
610  Added.........................................................66756
613  Authority citation revised....................................66750
613.6-70  Added....................................................66758
613.103-70  (a) and (b) designation removed........................66757
613.505-1  Added...................................................66757
613.505-2  Revised.................................................66758
613.505-70  Added..................................................66758
613.507-70  Amended................................................66758
614  Authority citation revised....................................66750
614.201-7-70  (a)(1) and (d) removed; (a)(2) redesignated as (a); 
        (b) amended; (c) revised...................................66758
614.404-1  Amended.................................................66758
615  Authority citation revised....................................66750
615.106-70  Amended................................................66758
615.403--615.413-2 (Subpart 615.4)  Added..........................66758
615.504--615.506 (Subpart 615.5)  Added............................66758
615.604  Added.....................................................66759
615.607  Amended...................................................66759
615.608  Amended...................................................66759
616  Authority citation revised....................................66750
616.102-70  Revised................................................66759
616.203-4  Amended.................................................66759
616.301-3  Amended.................................................66759
616.306  Amended...................................................66759
616.603-2  Amended.................................................66759
617  Authority citation revised....................................66750
617.102-2  Amended.................................................66759
617.102-3  Added...................................................66759
617.201-70  Amended................................................66759
617.204  Added.....................................................66759
617.207  Removed...................................................66759
617.207-70  Removed................................................66759
617.502  Amended...................................................66759
617.504-70  Added..................................................66759
619  Authority citation revised....................................66750
    Nomenclature change............................................66759
619.201  (c) and (d)(5) amended....................................66759
619.501  Added.....................................................66759
619.506  Added.....................................................66759
619.705-1  Added...................................................66760
619.705-3  Amended.................................................66760
619.705-6-70  (b) amended..........................................66760
619.708-70  Added..................................................66760
619.801  Revised...................................................66760
619.810  Added.....................................................66760
619.812  Added.....................................................66760
619.870  (b) amended...............................................66760
622  Authority citation revised....................................66750
622.401  Added.....................................................66760
622.404-6  (b)(6) added............................................66760
622.406-3  Added...................................................66760
623  Authority citation revised....................................66750
623.302-70 (Subpart 623.3)  Added..................................66760
623.470--623.480 (Subpart 623.4)  Added............................66760
625  Authority citation revised....................................66750
625.102  Revised...................................................66762
625.108  Amended...................................................66762
625.202  Revised...................................................66762
625.203  Added.....................................................66762
625.304  Amended...................................................66762
625.901  Revised...................................................66762
625.1003 (Subpart 625.10)  Removed.................................66762
627  Added.........................................................66763

[[Page 620]]

628  Authority citation revised....................................66750
628.101--628.106-6 (Subpart 628.1)  Added..........................66763
628.203--628.203-7 (Subpart 628.2)  Added..........................66763
628.305--628.307-70 (Subpart 628.3)  Added.........................66763
631  Added.........................................................66764
632  Authority citation revised....................................66750
632.111-632.111-70 (Subpart 632.1)  Removed........................66764
632.402  Existing text designated as (c)(1)(iii); (b) added........66764
632.407  Added.....................................................66764
632.703-3 (Subpart 632.7)  Added...................................66764
632.803 (Subpart 632.8)  Added.....................................66764
632.908  Added.....................................................66764
633  Authority citation revised....................................66750
633.104  Introductory text removed; (a)(1) amended.................66764
633.105  Introductory text removed; (a) and (c) amended............66764
633.214-70  Added..................................................66764
634  Authority citation revised....................................66750
634.001  (b) and (c) amended.......................................66766
634.001-70  Amended................................................66766
634.003  (a) revised; (b) amended..................................66766
634.005  Added.....................................................66766
634.005-6  Added...................................................66766
636  Authority citation revised....................................66750
636.101-70  Amended................................................66766
636.602  Revised...................................................66766
637  Authority citation revised....................................66750
637.104-70  (f) amended............................................66766
637.106  Added.....................................................66766
637.110  Revised...................................................66766
637.204--637.270 (Subpart 637.2)  Removed..........................66766
639  Added.........................................................66766
642  Authority citation revised....................................66750
642.270  Revised...................................................66766
642.271  Amended...................................................66766
643  Authority citation revised....................................66750
643.102-70  (b) revised............................................66767
647  Added.........................................................66767
649  Added.........................................................66767
651  Added.........................................................66767
652  Authority citation revised....................................66750
652.202-70  Removed................................................66767
652.203-70  Added..................................................66767
652.203-71  Added..................................................66767
652.206-70  Added..................................................66767
652.214-70  Removed; new 652.214-70 redesignated from 652.214-71 
        and amended................................................66767
652.214-71  Redesignated as 652.214-70; new 652.214-71 
        redesignated from 652.214-72 and amended...................66767
652.214-72  Redesignated as 652.214-71.............................66767
652.216-70  Amended................................................66768
652.216-71  Added..................................................66768
652.219-70  Added..................................................66768
652.223-70  Added..................................................66768
652.223-71  Added..................................................66768
652.223-72  Added..................................................66768
652.223-73  Added..................................................66769
652.223-74  Added..................................................66769
652.223-75  Added..................................................66769
652.223-76  Added..................................................66769
652.223-77  Added..................................................66769
652.223-78  Added..................................................66769
652.228-71  Added..................................................66770
652.228-72  Added..................................................66770
652.228-73  Added..................................................66770
652.228-74  Added..................................................66771
652.228-75  Added..................................................66771
652.228-76  Added..................................................66771
652.228-77  Added..................................................66771
652.232-70  Revised................................................66771
652.232-71  Revised................................................66772
652.237-70  Revised................................................66772
652.237-71  Added..................................................66772
652.237-72  Added..................................................66772
652.242-70  Amended................................................66772
652.242-72  Amended................................................66772
653  Authority citation revised....................................66750
653.213-70  Revised................................................66773
653.217  Added.....................................................66773
653.217-70  Added..................................................66773
653.219  Added.....................................................66773
653.219-70  Added..................................................66773
653.302  Removed...................................................66773
670 (Subchapter I)  Removed........................................66773

[[Page 621]]

                                  1995

48 CFR
                                                                   60 FR
                                                                    Page
Chapter 3
Chapter 3  Attachment I corrected; CFR correction..................36740
Chapter 5
501.103  (b) revised...............................................42794
501.601  Revised...................................................40108
501.602-1  Removed.................................................40108
501.603  Removed...................................................40108
501.603-3  Removed.................................................40108
501.603-4  Removed.................................................40108
501.603-70  Removed................................................40108
501.700  Removed...................................................54955
501.704  Removed...................................................54955
501.704-70  Removed................................................54955
501.707  Revised...................................................54955
502.101  Amended............................................21467, 54957
503.104-10  (a), (b)(3) and (c) revised............................42794
503.404  (a) revised...............................................42794
503.570-2  Amended.................................................42802
504.800  Amended...................................................42802
504.7001-2  (c) revised; (f) amended...............................54955
505.101  (c) introductory text revised.............................42794
    (b) amended....................................................42802
505.202  (a) introductory text revised; (b)(1) removed; (b)(2) and 
        (3) redesignated as (b)(1) and (2).........................42794
505.203  (b) revised...............................................42794
505.240-70  (b) amended............................................42802
505.303-70  (a)(4) and (b)(1) amended..............................42802
505.503  Amended...................................................42802
506.001  Added.....................................................42794
506.304  Introductory text revised.................................21467
507.100  Removed...................................................42794
507.102  Amended...................................................42802
507.104  (c), (d) and (e) revised..................................54955
507.104  (c), (e) introductory text and (2) revised................42802
508.301--508.370 (Subpart 508.3)  Removed..........................54956
508.7  Heading revised.............................................54956
508.705-70  (b) and (d) revised....................................54956
509.106-70  Removed................................................54956
510.004  (b)(2) amended............................................42802
510.011  (a), (e), (g) and (i) revised; (j) removed................42802
512.104  (b) amended...............................................42803
513  Heading revised...............................................42803
513.106  (c)(2) revised............................................21467
    Revised........................................................42803
513.204  Removed...................................................42803
513.501  Removed...................................................42803
513.505-2  (c) and (d) amended.....................................42803
513.505-3  (a) revised.............................................42803
513.505-70  Revised................................................42803
513.7001  (d)(1), (2) and (4) removed; (b)(3) and (d)(3) 
        redesignated as (b)(4) and (d)(2); new (b)(3) and new 
        (d)(1) added; new (b)(4) and (c) revised...................42803
514.203-1  Heading revised.........................................42803
514.205-1  (a) amended.............................................42803
514.370  Amended...................................................42803
514.402-1  (b) amended.............................................42803
514.406  Redesignated as 514.407...................................42804
514.406-3  Redesignated as 514.407-3...............................42804
514.406-4  Redesignated as 514.407-4...............................42804
514.407  Redesignated as 514.408...................................42803
    Redesignated from 514.406......................................42804
514.407-1  Redesignated as 514.408-1...............................42803
514.407-3  Redesignated from 514.406-3 and revised.................42804
514.407-4  Redesignated from 514.406-4.............................42804
514.407-6  Redesignated as 514.408-6...............................42803
514.407-70  Redesignated as 514.408-70.............................42803
514.407-71  Redesignated as 514.408-71.............................42803
514.407-72  Redesignated as 514.408-72.............................42803
514.408  Redesignated as 514.409...................................42803
    Redesignated from 514.407......................................42803
514.408-1  Redesignated as 514.409-1...............................42803
    Redesignated from 514.407-1; (a), (b) and (c) amended..........42803
    (c) corrected..................................................44387
    (a) revised....................................................54957
514.408-6  Redesignated from 514.407-6.............................42803
514.408-70  Redesignated as 514.409-70.............................42803
    Redesignated from 514.407-70...................................42803
514.408-71  Redesignated from 514.407-71...........................42803

[[Page 622]]

514.408-72  Redesignated from 514.407-72 and revised...............42803
514.409  Redesignated from 514.408.................................42803
514.409-1  Redesignated from 514.408-1.............................42803
514.409-70  Redesignated from 514.408-70...........................42803
515.501  Revised...................................................54956
515.1001  Removed..................................................42804
515.1070  (b), (c) introductory text and (1) amended...............42804
516.301--516.306 (Subpart 516.3)  Removed..........................54956
516.403  Removed...................................................54956
519.001  Revised...................................................39661
519.201  Revised...................................................39661
519.202-2  (c) revised.............................................39661
519.304  Removed...................................................39661
519.502-1  Removed.................................................54956
519.705-2  Revised.................................................42794
519.708  (c) revised; (d)(1) removed; (d)(2) and (3) redesignated 
        as (d)(1) and (2)..........................................42794
523.370  Revised...................................................42804
525.901 (Subpart 525.9)  Added.....................................54957
528.103-2  (a) revised.............................................54956
528.106-1  Removed.................................................54956
528.310  Amended...................................................42804
529.401-70  Revised................................................42804
532.111  (c) and (d) revised.......................................42804
536.302-70  Removed................................................54956
536.570-2  Amended.................................................42804
536.570-4  (c) amended.............................................42804
536.570-5  Amended.................................................42804
536.570-8  Amended.................................................42804
536.570-9  Amended.................................................42804
536.570-13  Amended................................................42804
536.570-14  Amended................................................42804
538.203-71  (a) revised; (f) added.................................19361
541  Added.........................................................54956
542.703 (Subpart 542.7)  Added.....................................54957
543.205  (a) and (b)(2) amended....................................42804
546.403  Introductory text amended.................................42804
546.710  (e) amended...............................................42804
549.111  Revised...................................................54956
552.203-72  Amended................................................42795
552.219-1  Removed.................................................39661
552.225-72  Amended................................................21467
552.238-72  Heading revised; amended...............................19361
552.238-77  Added..................................................19362
    (b)(1) corrected...............................................45528
552.270-1  Introductory text revised...............................42795
552.270-2  Introductory text revised...............................42795
552.270-3  Amended; introductory text revised......................42795
552.270-4  Introductory text revised...............................42795
552.270-5  Introductory text revised...............................42795
552.270-6  Introductory text revised...............................42795
552.270-10  Introductory text revised..............................42795
552.270-11  Introductory text revised..............................42795
552.270-12  Introductory text revised..............................42795
552.270-13  Introductory text revised..............................42795
552.270-15  Introductory text revised..............................42795
552.270-16  Introductory text revised..............................42795
552.270-17  Introductory text revised..............................42795
552.270-18  Introductory text revised..............................42795
552.270-19  Introductory text revised..............................42795
552.270-20  Amended................................................19363
    Introductory text revised......................................42795
552.270-21  Amended; introductory text revised.....................42795
552.270-22  Introductory text revised..............................42796
552.270-23  Removed................................................42796
552.270-24  Removed................................................42796
552.270-25  Introductory text revised..............................42796
552.270-27  Introductory text revised..............................42796
552.270-28  Introductory text revised..............................42796
552.270-30  Introductory text revised..............................42796
552.270-31  Introductory text revised..............................42796
552.270-32  Introductory text revised..............................42796
552.270-33  Introductory text revised..............................42796
552.270-34  Introductory text revised..............................42796

[[Page 623]]

552.270-35  Introductory text revised..............................42796
552.270-36  Introductory text revised..............................42796
552.270-37  Introductory text revised..............................42796
552.270-38  Introductory text revised..............................42796
552.270-39  Introductory text revised..............................42796
552.270-40  Introductory text revised..............................42796
552.270-41  Introductory text revised..............................42796
552.300  Amended...................................................42804
570.102  Amended............................................19363, 42796
570.104  Revised...................................................42796
570.105  Revised...................................................42796
570.201--570.204-5 (Subpart 570.2)  Revised........................42796
570.208-3  Removed.................................................19363
570.301--570.311 (Subpart 570.3)  Revised..........................42797
570.304-5  Revised.................................................19363
570.501  (d) and (e) removed.......................................19363
570.502  (a) (b)(1), (2), (3)(ii) and (iii)(B) revised.............42799
570.503  (a), (b) introductory text and (c) revised................42799
570.504  Revised...................................................42800
570.505  (a) revised...............................................42800
570.602-1  (a) and (b) amended.....................................42800
570.602-2  (c)(3) amended..........................................19363
    (e)(3) and (g) amended.........................................42800
570.701--570.704 (Subpart 570.7)  Revised..........................42800
570.801  Revised...................................................42801
570.802  (c), (e), (f) and (g) removed; (d) redesignated as (c)....19363
    Revised........................................................42801
Chapter 6
601.601--601.603-70  (Subpart) Heading revised.....................39662
601.603-70  (b)(5) and (6) amended.................................39662
602.101-70  Amended................................................39662
605.202-70  Revised................................................39662
606.570  Revised...................................................39662
609.405  (d)(4)(i) amended.........................................39662
610.002-70  (d)(5)(i) amended......................................39662
613  Heading revised...............................................39662
613.103-70  Amended................................................39662
613.403  Redesignated from 613.404 and amended.....................39662
613.404  Redesignated as 613.403...................................39662
613.505-1  Revised.................................................39662
613.505-2  Removed.................................................39663
613.507  Revised...................................................39663
613.507-70  Revised................................................39663
613.601-70  (b) revised............................................39663
616.000  Added.....................................................39663
619.201  (d)(5) amended............................................39663
619.501  (c) amended...............................................39663
625.703  Revised...................................................39663
636.602-5  Amended.................................................39663
637.104-70  (b) and (c) amended....................................39663
653.213  Heading revised...........................................39663
653.213-70  Heading revised; (b) amended...........................39663
653.219-70  Heading revised........................................39663

                                  1996

48 CFR
                                                                   61 FR
                                                                    Page
Chapter 4
Chapter 4  Revised.................................................53646
Chapter 5
501.105  Amended; interim (OMB numbers).............................6164
    Corrected......................................................14033
501.402--501.404 (Subpart 501.4)  Revised..........................51374
504.803  (a)(12) and (25) revised; interim..........................6165
    (a) introductory text corrected................................14033
505.303-70  (a)(1), (b)(1), (2) and (3)(ii) revised.................1150
506.001  Removed...................................................39088
    Regulation at 61 FR 39088 eff. date corrected to 8-19-96.......42190
506.302-1  Amended.................................................39088
    Regulation at 61 FR 39088 eff. date corrected to 8-19-96.......42190
506.303-1  (a) and (b) designation removed.........................39088
    Regulation at 61 FR 39088 eff. date corrected to 8-19-96.......42190
506.303-2  Removed.................................................39088
    Regulation at 61 FR 39088 eff. date corrected to 8-19-96.......42190
506.304  Removed...................................................39088
    Regulation at 61 FR 39088 eff. date corrected to 8-19-96.......42190
507.103  Amended; interim...........................................6165
510  Heading revised; interim.......................................6165

[[Page 624]]

510.001  Redesignated as 511.001; interim...........................6165
510.002  Redesignated as 511.002; interim...........................6165
510.004  Removed; interim...........................................6165
510.004-70  Removed; interim........................................6165
510.004-71  Removed; interim........................................6165
510.007  Removed; interim...........................................6165
510.007-70  Removed; interim........................................6165
510.011  Redesignated as 511.204; interim...........................6165
    (a) corrected..................................................10846
510.070  Removed; interim...........................................6165
510.070-1  Removed; interim.........................................6165
510.070-2  Removed; interim.........................................6165
510.070-3  Removed; interim.........................................6165
510.070-4  Removed; interim.........................................6165
510.071  Removed; interim...........................................6165
511  Heading revised; interim.......................................6165
511.001  Redesignated from 510.001; interim.........................6165
511.002  Redesignated from 510.002 and amended; interim.............6165
511.003  Removed; interim...........................................6165
511.070  Removed; interim...........................................6165
511.103--511.170 (Subpart 511.1)  Added; interim....................6165
511.2 (Subpart 511.2)  Added; interim...............................6166
511.204  Redesignated from 510.011; (c) and (d) removed; (e) 
        through (i) redesignated as (c) through (g); (a), (b) and 
        new (c) through new (g) amended; interim....................6165
511.401  Redesignated from 512.101; interim.........................6166
511.404  Redesignated from 512.104; (a)(2) revised; (a)(3), (4) 
        and (5) redesignated as (a)(4), (5) and (6); (a)(1), new 
        (4), new (5), new (6) and (b) amended; new (a)(3) added; 
        interim.....................................................6166
    (a)(3) corrected...............................................14033
512  Heading revised; interim.......................................6166
512.101--512.104 (Subpart 512.1)  Redesignated as 511.401--511.404 
        (Subpart 511.4); interim....................................6166
512.101  Redesignated as 511.401; interim...........................6166
512.104  Redesignated as 511.404; interim...........................6166
512.203--512.209 (Subpart 512.2)  Added; interim....................6166
512.301--512.302 (Subpart 512.3)  Added; interim....................6166
514.201-70  Revised; interim........................................6167
515.106-70  Revised; interim........................................6167
515.412  Removed; interim...........................................6167
515.414-70  Revised; interim........................................6167
515.804  Heading revised; interim...................................6167
515.804-3  Removed; interim.........................................6167
515.804-6  Revised; interim.........................................6167
    (a) corrected..................................................10846
    (b)(5) corrected...............................................14033
519  Heading revised................................................1150
519.001  Revised....................................................1150
519.201  Revised....................................................1150
519.202-2  Revised..................................................1151
519.202-5  Removed..................................................1151
519.502-70  (a) and (d) revised.....................................1151
519.503  (b) amended................................................1151
519.602-3  (a) and (b) amended......................................1151
519.705--519.708 (Subpart 519.7)  Heading revised...................1151
519.708  Revised....................................................1151
519.803-70  Revised.................................................1151
520  Removed........................................................1151
532.112  Added......................................................1151
532.112-1  Added....................................................1151
532.705-1  Revised..................................................1151
533.104  (a) heading, (c) and (d) revised; (a)(1), (3)(v), (5) 
        introductory text and (b) introductory text amended.........1151
533.105  (a)(1) introductory text amended...........................1152
538  Heading revised; interim.......................................6168
538.000  Removed; interim...........................................6169
538.270  Added; interim.............................................6169
    (d) corrected..................................................10846
538.271  Added; interim.............................................6169
539  Removed; interim...............................................6169
539.000  Removed; interim...........................................6169
543.205  (c) added; interim.........................................6169
546.710  (a)(2) revised; interim....................................6169
547.303-1  (b)(3) amended..........................................39089
    Regulation at 61 FR 39089 eff. date corrected to 8-19-96.......42190
552.209-73  Amended; interim........................................6169
552.210-70  Redesignated as 552.211-71; interim.....................6169
552.210-71  Redesignated as 552.211-72; interim.....................6169
552.210-72  Redesignated as 552.211-79; interim.....................6169
552.210-73  Redesignated as 552.211-80; interim.....................6169
552.210-74  Redesignated as 552.211-70; interim.....................6169

[[Page 625]]

552.210-75  Redesignated as 552.211-73; interim.....................6169
552.210-76  Redesignated as 552.211-74; interim.....................6170
552.210-77  Redesignated as 552.211-75; interim.....................6170
552.210-78  Redesignated as 552.211-76; interim.....................6170
552.210-79  Redesignated as 552.211-77; interim.....................6170
552.211-1  Redesignated from 552.212-1 and amended; interim.........6170
552.211-70  Removed; new 552.211-70 redesignated from 552.210-74 
        and amended; interim........................................6169
552.211-71  Redesignated from 552.210-70 and amended; interim.......6169
552.211-72  Redesignated from 552.210-71 and amended; interim.......6169
552.211-73  Redesignated from 552.210-75 and amended; interim.......6169
552.211-74  Redesignated from 552.210-76 and amended; interim.......6170
552.211-75  Redesignated from 552.210-77 and amended; interim.......6170
552.211-76  Redesignated from 552.210-78 and amended; interim.......6170
552.211-77  Redesignated from 552.210-79 and amended; interim.......6170
552.211-78  Added; interim..........................................6170
552.211-79  Redesignated from 552.210-72 and amended; interim.......6169
552.211-80  Redesignated from 552.210-73 and amended; interim.......6169
552.211-81  Redesignated from 552.212-70 and amended; interim.......6170
552.211-82  Redesignated from 552.212-71 and amended; interim.......6170
    Correctly designated...........................................14033
552.211-83  Redesignated from 552.212-72 and amended; interim.......6170
552.211-84  Redesignated from 552.212-74 and amended; interim.......6170
552.212-1  Redesignated as 552.211-1; interim.......................6170
552.212-70  Redesignated as 552.211-81; new 552.212-70 added; 
        interim.....................................................6170
552.212-71  Redesignated as 552.211-82; interim.....................6170
    Added; interim..................................................6171
    Corrected......................................................10846
552.212-72  Redesignated as 552.211-83; interim.....................6170
    Added; interim..................................................6171
552.212-73  Added; interim..........................................6171
552.212-74  Redesignated as 552.211-84; interim.....................6170
552.215-70  Amended; interim........................................6172
552.215-71  Added; interim..........................................6172
552.215-72  Added; interim..........................................6172
552.216-71  Amended; interim........................................6172
    Corrected......................................................10846
552.219-9  Removed..................................................1152
552.219-16  Removed.................................................1152
552.219-72  Revised.................................................1152
552.219-73  Amended.................................................1152
552.219-74  Amended..........................................1152, 39089
    Regulation at 61 FR 39089 eff. date corrected to 8-19-96.......42190
    Corrected......................................................42462
552.238-74  Amended; interim........................................6172
552.243-72  Added; interim..........................................6172
    Corrected......................................................10846
552.246-73  Amended; interim........................................6173
552.253-70  Removed; interim........................................6173
570.106  (c) added; interim........................................24721
570.303  (a)(7) revised; (a)(8) removed; (a)(9) and (10) 
        redesignated as (a)(8) and (9); interim....................24721
570.308-2  (c) amended; interim.....................................6173
570.602-2  (c)(3) and (d) amended; interim..........................6173

                                  1997

  (Regulations published from January 1, 1997, through October 1, 1997)

48 CFR
                                                                   62 FR
                                                                    Page
Chapter 5
Chapter 5  Compliance guide........................................44526

[[Page 626]]

501.105  Regulation at 61 FR 6164 confirmed........................44521
504.803  Regulation at 61 FR 6165 confirmed........................44521
507.103  Regulation at 61 FR 6165 confirmed........................44521
510  Regulation at 61 FR 6165 confirmed............................44251
510.001  Regulation at 61 FR 6165 confirmed........................44521
510.002  Regulation at 61 FR 6165 confirmed........................44251
510.004  Regulation at 61 FR 6165 confirmed........................44521
510.004-70  Regulation at 61 FR 6165 confirmed.....................44521
510.004-71  Regulation at 61 FR 6165 confirmed.....................44521
510.007  Regulation at 61 FR 6165 confirmed........................44521
510.007-70  Regulation at 61 FR 6165 confirmed.....................44521
510.011  Regulation at 61 FR 6165 confirmed........................44251
510.070  Regulation at 61 FR 6165 confirmed........................44521
510.070-1  Regulation at 61 FR 6165 confirmed......................44521
510.070-2  Regulation at 61 FR 6165 confirmed......................44521
510.070-3  Regulation at 61 FR 6165 confirmed......................44521
510.070-4  Regulation at 61 FR 6165 confirmed......................44521
510.071  Regulation at 61 FR 6165 confirmed........................44521
511  Regulation at 61 FR 6165 confirmed............................44521
511.001  Regulation at 61 FR 6165 confirmed........................44251
511.002  Regulation at 61 FR 6165 confirmed........................44251
511.003  Regulation at 61 FR 6165 confirmed........................44521
511.070  Regulation at 61 FR 6165 confirmed........................44521
511.103--511.170 (Subpart 511.1)  Regulation at 61 FR 6165 
        confirmed..................................................44521
511.204 (Subpart 511.2)  Regulation at 61 FR 6166 confirmed........44251
511.204  Regulation at 61 FR 6165 confirmed........................44251
511.401--511.404 (Subpart 511.4)  Regulation at 61 FR 6166 
        confirmed..................................................44251
511.401  Regulation at 61 FR 6166 confirmed........................44521
511.404  Regulation at 61 FR 6166 confirmed........................44521
512  Regulation at 61 FR 6166 confirmed............................44521
512.104--512.104 (Subpart 512.1)  Regulation at 61 FR 6166 
        confirmed..................................................44521
512.101  Regulation at 61 FR 6166 confirmed........................44521
512.104  Regulation at 61 FR 6166 confirmed........................44521
512.201--512.209 (Subpart 512.2)  Regulation at 61 FR 6166 
        confirmed..................................................44521
512.301--512.303 (Subpart 512.3)  Regulation at 61 FR 6166 
        confirmed..................................................44521
514.201-70  Regulation at 61 FR 6167 confirmed.....................44521
515.106-70  Revised................................................44521
515.412  Regulation at 61 FR 6167 confirmed........................44521
515.414-70  Regulation at 61 FR 6166 confirmed.....................44521
515.804  Regulation at 61 FR 6167 confirmed........................44521
515.804-3  Regulation at 61 FR 6167 confirmed......................44521
515.804-6  Regulation at 61 FR 6167 confirmed......................44521
    Revised........................................................44522
538  Regulation at 61 FR 6168 confirmed............................44521
538.000  Regulation at 61 FR 6169 confirmed........................44521
538.270  Regulation at 61 FR 6169 confirmed........................44521
    Revised........................................................44523
538.271  Regulation at 61 FR 6169 confirmed........................44521
    (a) revised....................................................44524
539  Regulation at 61 FR 6169 confirmed............................44521
539.000  Regulation at 61 FR 6169 confirmed........................44521
543.205  Regulation at 61 FR 6169 confirmed........................44521
    (c) revised....................................................44524
546.710  Regulation at 61 FR 6169 confirmed........................44521

[[Page 627]]

552.209-73  Regulation at 61 FR 6169 confirmed.....................44521
552.210-70  Regulation at 61 FR 6169 confirmed.....................44521
552.210-71  Regulation at 61 FR 6169 confirmed.....................44521
552.210-72  Regulation at 61 FR 6169 confirmed.....................44521
552.210-73  Regulation at 61 FR 6169 confirmed.....................44521
552.210-74  Regulation at 61 FR 6169 confirmed.....................44521
552.210-75  Regulation at 61 FR 6169 confirmed.....................44521
552.210-76  Regulation at 61 FR 6170 confirmed.....................44521
552.210-77  Regulation at 61 FR 6170 confirmed.....................44521
552.210-78  Regulation at 61 FR 6170 confirmed.....................44521
552.210-79  Regulation at 61 FR 6170 confirmed.....................44521
552.211-1  Regulation at 61 FR 6170 confirmed......................44521
552.211-71  Regulation at 61 FR 6169 confirmed.....................44521
552.211-72  Regulation at 61 FR 6169 confirmed.....................44521
552.211-73  Regulation at 61 FR 6169 confirmed.....................44521
552.211-74  Regulation at 61 FR 6170 confirmed.....................44521
552.211-75  Regulation at 61 FR 6170 confirmed.....................44521
552.211-76  Regulation at 61 FR 6170 confirmed.....................44521
552.211-77  Regulation at 61 FR 6170 confirmed.....................44521
552.211-78  Regulation at 61 FR 6170 confirmed.....................44521
552.211-79  Regulation at 61 FR 6169 confirmed.....................44521
552.211-80  Regulation at 61 FR 6169 confirmed.....................44521
552.211-81  Regulation at 61 FR 6170 confirmed.....................44521
552.211-82  Regulation at 61 FR 6170 confirmed.....................44521
552.211-83  Regulation at 61 FR 6170 confirmed.....................44521
552.211-84  Regulation at 61 FR 6170 confirmed.....................44521
552.212-1  Regulation at 61 FR 6170 confirmed......................44521
552.212-70  Regulation at 61 FR 6170 confirmed.....................44521
    Revised........................................................44524
552.212-71  Regulations at 61 FR 6170 and 6171 confirmed...........44521
    Amended........................................................44524
552.212-72  Regulations at 61 FR 6170 and 6171 confirmed...........44521
552.212-73  Regulation at 61 FR 6171 confirmed.....................44521
    Revised........................................................44524
552.212-74  Regulation at 61 FR 6170 confirmed.....................44521
552.215-70  Regulation at 61 FR 6172 confirmed.....................44521
552.215-71  Regulation at 61 FR 6172 confirmed.....................44521
    Revised........................................................44525
552.215-72  Regulation at 61 FR 6172 confirmed.....................44251
    Revised........................................................44525
552.216-71  Regulation at 61 FR 6172 confirmed.....................44521
552.238-72  Amended................................................38476
552.238-74  Regulation at 61 FR 6172 confirmed.....................44521
552.238-77  Amended................................................38476
552.243-72  Regulation at 61 FR 6172 confirmed.....................44521
    Amended........................................................44525
552.246-73  Regulation at 61 FR 6173 confirmed.....................44521
552.253-70  Regulation at 61 FR 6173 confirmed.....................44521
552.308-2  Regulation at 61 FR 6173 confirmed......................44521
552.602-2  Regulation at 61 FR 6173 confirmed......................44521
570.106  (c) introductory text, (1), (2) and (3) revised............5166
570.308-2  (e) revised.............................................44525