[Federal Register Volume 59, Number 147 (Tuesday, August 2, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-18649]


[[Page Unknown]]

[Federal Register: August 2, 1994]


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DEPARTMENT OF DEFENSE
48 CFR Parts 251 and 252

 

Defense Federal Acquisition Regulation Supplement; Government 
Supply Sources

AGENCY: Department of Defense (DoD).

ACTION: Proposed rule with request for comments.

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SUMMARY: The Department of Defense is proposing to amend the Defense 
Federal Acquisition Regulation Supplement to clarify its policy 
concerning contractor payments for materials purchased from Government 
supply sources.

DATES: Commments on the proposed rule should be submitted in writing at 
the address shown below on or before October 3, 1994, to be considered 
in the formulation of a final rule.

ADDRESSES: Interested parties should submit written comment to: Defense 
Acquistion Regulations Council, ATTN: Mr. Eric R. Mens, PDUSD (A&T) DP/
DAR, IMD 3D139, 3062 Defense Pentagon, Washington, DC 20301-3062. 
Telefax number (703) 604-5971. Please cite DFARS Case 94-D002 in all 
correspondence.

FOR FURTHER INFORMATION CONTACT:
Mr. Eric R. Mens, (703) 604-5929.

SUPPLEMENTARY INFORMATION:

A. Background

    The DoD Office of the Inspector General issued an audit report on 
June 3, 1994, (Report No. 94-119, Accounts Receivable for DoD Material) 
which addressed problems with contractors which were delinquent in 
making payments for materials purchased from the DoD supply system. The 
proposed rule, which is intended to address the problems identified in 
the Inspector General's report, revises the Defense FAR Supplement 
(DFARS) at 251.102(e) to require the contracting officer's 
authorization for the contractor to purchase from Government supply 
sources to specifically state the terms of the purchase; adds 251.105 
and revises 252.251-7000(d)(4) to clarify that contractor payments for 
such purchases are due within 30 days of the Government's invoice; 
revises 252.251-7000(d)(4) to clarify that contractors must pay 
interest on late payments and that failure to pay may result in loss of 
the authorization to use Government supply sources; and adds 252.251-
7000(f) to provide for identification of the contractor's billing and 
the Government's remittance address.

B. Regulatory Flexibility Act

    The proposed rule is not expected to have a significant economic 
impact on a substantial number of small entities within the meaning of 
the Regulatory Flexibility Act, 5 U.S.C. 601 et seq., because the 
proposed rule clarifies that the Government terms for contractor 
payments for purchases from Government supply sources is the same as 
the standard commercial terms of payment in ``net 30 days.'' The rule 
will only impact those small entities which fail to meet their payment 
obligations thereby incurring interest on the overdue amount, which 
also reflects acceptable commercial practice.

C. Paperwork Reduction Act

    The Paperwork Reduction Act (Pub. L. 96-511) does not apply because 
the proposed rule does not impose any additional reporting or 
recordkeeping requirements which require the approval of OMB under 44 
U.S.C. 3501 et seq.

List of Subjects in 48 CFR Parts 251 and 252

    Government procurement.
Claudia L. Naugle,
Deputy Director, Defense Acquisition Regulations Council.

    Therefore, it is proposed that 48 CFR Parts 251 and 252 be amended 
as follows:
    1. The authority citation for 48 CFR Parts 251 and 252 continues to 
read as follows:

    Authority: 41 U.S.C. 421 and 48 CFR Chapter 1.

PART 251--USE OF GOVERNMENT SOURCES BY CONTRACTORS

    2. Section 251.102 is amended by revising paragraph (e) to read as 
follows:


251.102  Authorization to use Government supply sources.

    (e) Use the format in Table 51-1, Authorization to Purchase from 
Government Supply Sources. Specify the terms of the purchase, including 
contractor acceptance of any Government materiel, payment terms, and 
the addresses required by paragraph (f) of the clause at 252.251-7000, 
Ordering from Government Supply Sources.
* * * * *
    3. Section 251.105 is added to read as follows:


251.105  Payment for shipments.

    Contractor payments for purchases from Government sources are due 
within 30 days of the date of the Government's invoice.

PART 252--SOLICITATION PROVISIONS AND CONTRACT CLAUSES

    4. Section 252.251-7000 is amended to revise paragraph (d)(4) and 
add a new paragraph (f) to read as follows:


252.251-7000  Ordering from Government supply sources.

* * * * *

ORDERING FROM GOVERNMENT SUPPLY SOURCES (XXX 1994)

* * * * *
    (d) * * *
    (4) Pay invoices from Government supply sources within 30 days 
of the date of the invoice. For purposes of computing interest for 
late Contractor payments, the Government's invoice is deemed to be a 
demand for payment in accordance with the Interest clause of this 
contract. The Contractor's failure to pay may also result in the 
Contracting Officer terminating the Contractor's authorization to 
use Government supply sources. In the event the Contracting Officer 
terminates the authorization, such termination shall not provide the 
Contractor with an excusable delay for failure to perform or 
complete the contract in accordance with the terms of the contract, 
and the Contractor shall be solely responsible for any increased 
costs.
    (e) * * *
    (f) Government invoices shall be submitted to the Contractor's 
billing address, and Contractor payments shall be sent to the 
Government remittance address specified below:

Contractor's Billing Address (include point of contract and 
telephone number):
Government Remittance Address (include point of contact and 
telephone number):

(End of clause)

[FR Doc. 94-18649 Filed 8-1-94; 8:45 am]
BILLING CODE 5000-04-M