[Federal Register Volume 60, Number 37 (Friday, February 24, 1995)]
[Notices]
[Pages 10371-10372]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-4702]



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COMMITTEE FOR PURCHASE FROM PEOPLE WHO ARE BLIND OR SEVERELY DISABLED


Procurement List Addition

AGENCY: Committee for Purchase From People Who Are Blind or Severely 
Disabled.

ACTION: Addition to the Procurement List.

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SUMMARY: This action adds to the Procurement List tabulating machine 
paper to be furnished by nonprofit agencies employing persons who are 
blind or have other severe disabilities.

EFFECTIVE DATE: March 27, 1995.

ADDRESSES: Committee for Purchase From People Who Are Blind or Severely 
Disabled, Crystal Square 3, Suite 403, 1735 Jefferson Davis Highway, 
Arlington, Virginia 22202-3461.

FOR FURTHER INFORMATION CONTACT: Beverly Milkman (703) 603-7740.

SUPPLEMENTARY INFORMATION: On July 29, 1994, the Committee for Purchase 
From People Who Are Blind or Severely Disabled published notice (59 FR 
38586) of proposed addition to the Procurement List.
    Comments were received from a contractor for this type of paper and 
two trade associations. One of the trade associations objected to the 
proposal because it is concerned about the impact of taxpayer-sponsored 
printing operations, largely in the Federal Prison Industries, on an 
industry which it claims has very small profit margins. The other trade 
association reiterated its earlier objections to the Committee's 1991 
addition of this paper to the Procurement List, which centered on the 
action's substantial adverse impact on the entire business forms 
industry. The association stated, without providing specific details, 
that the industry's experience since that supported its earlier 
contentions.
    Neither trade association provided any data that would support a 
contention that the Committee's action in adding a portion of the 
Government requirement for this particular type of paper to the 
Procurement List would have a severe adverse impact on the entire 
business forms industry. The Committee believes that what it is adding 
to the Procurement List is only a small part of the total demand for 
this paper, as the Government version is identical to what is widely 
used in the private sector and the private market is considerably 
larger than the Government market. Moreover, other types of business 
forms are purchased in both the Government and commercial markets. 
Consequently, the Committee does not believe that its action with 
respect to one particular type of paper purchased by the Government 
will have a severe impact on the entire business forms industry.
    The contractor submitted information on several firms in the 
industry which had suffered from declining Government sales, including 
itself, and claimed that the 1991 addition of this paper to the 
Procurement List had caused these impacts, as it indicated Government 
sales had declined but commercial sales had not. The contractor also 
attempted to incorporate in its comments by reference all materials 
submitted by all parties to the 1991 addition of the paper to the 
Procurement List, the Committee's subsequent reconsideration of its 
addition decision, and resulting litigation, including all court 
opinions filed by the trial and appellate courts.
    The Committee rejected the attempted incorporation by reference as 
unreasonably burdensome on the Committee's resources, and asked the 
contractor to provide the documents which it considered relevant to its 
present arguments. While it provided an extensive collection of 
documents in response, the contractor indicated that the Committee 
should not consider the contractor's contentions to be limited to what 
appeared in those specific documents. The contractor also indicated 
that all the materials supported its contention that the Committee is 
required to make four determinations, which the contractor enumerated, 
before it can decide in accordance with its regulations that a 
commodity or service may be added to the Procurement List.
    Accordingly, the Committee believes that its duty to explain its 
conclusion that the paper may be properly added to the Procurement List 
will be met by addressing these four determination requirements and the 
contractor's industry impact contentions.
    These determinations are that: (1) The nonprofit agencies have the 
capacity to produce the paper; (2) the level of blind employment 
claimed by the nonprofit agencies will be used in producing the paper; 
(3) the nonprofit agencies can produce the paper at the fair market 
price established by the Committee; and (4) there will not be a severe 
adverse impact on current suppliers. These determinations are the 
contractor's summation of the Committee's regulatory criteria for 
adding a commodity or service to the Procurement List.
    The Committee's determinations that the nonprofit agencies have the 
capacity [[Page 10372]] to produce the paper and will use the amount of 
blind direct labor claimed by the participating nonprofit agencies are 
supported by the Committee's industrial engineer's assessments of the 
data submitted and inspection of a producing facility. In addition, the 
nonprofit agencies successfully produced the paper for some time before 
the previous addition to the Procurement List was voided by the 
appellate court. As a result of this performance, the Federal agency 
which buys paper for the Government waived its opportunity to conduct 
its own inspection of the nonprofit agencies to determine their 
capability.
    The Committee does not agree with the contractor that its 
regulations require it to make a determination that the nonprofit 
agencies can produce the paper at the fair market price. The 
contractor's contention is based on its reading of a Committee 
regulation in effect in 1991. That interpretation of the regulatory 
language was not consistent with the Committee's statute, which 
separates the establishment of a fair market price from the suitability 
determination which is subject to the rulemaking requirements of the 
Administrative Procedure Act. To remove the appearance of 
inconsistency, the Committee in 1994 amended its regulations to remove 
the fair market price determination from the factors the Committee must 
consider to decide that an item is suitable for addition to the 
Procurement List. The Committee does require the nonprofit agencies to 
agree to provide the item in question at the fair market price when it 
adds a commodity or service to the Procurement List, and all five 
nonprofit agencies which will produce this paper have provided their 
agreement to provide it at the fair market price established by the 
Committee.
    The commenting contractor is the current supplier of this paper to 
the Government. The Committee used the sales figure provided by the 
contractor for its fiscal year 1994, adjusted to account for the fact 
that the figure includes no Government sales of the paper, as the basis 
of its impact determination for the contractor. The Committee has also 
reduced the portion of the Government requirement for the paper being 
added to the Procurement List by approximately 25 percent from the 
original proposal, by removing the requirement for one of the 
purchasing agency's four depots from the scope of the addition. This 
reduced addition represents a percentage of the contractor's adjusted 
sales which is well below the level the Committee normally considers to 
constitute severe adverse impact. Because the contractor will continue 
to have an opportunity to supply the paper to the Government, and 
because the contractor also supplies other paper items to the 
Government regularly, the Committee believes that the other economic 
impacts on itself cited in the contractor's comments do not add 
sufficiently to the impact to raise it to a severe level. The 
contractor appears to concur, as it recently informed the Committee 
that it would not challenge the Committee's action if the Committee 
added to the Procurement List only the supply requirements for the 
three depots covered by this rulemaking.
    While the commenting contractor submitted more information to 
support a claim of industry impact than did the trade associations, it 
did not establish conclusively that this impact was due to the 
Committee's action in 1991, rather than to Government downsizing or 
other factors. Consequently, the Committee believes that the conclusion 
it reached in rejecting the association's claims of industry impact 
would apply as well to the contractor's claim, for the reasons already 
stated.
    After consideration of the material presented to it concerning 
capability of qualified nonprofit agencies to provide the commodity, 
fair market price, and impact of the addition on the current or most 
recent contractors, the Committee has determined that the commodity 
listed below is suitable for procurement by the Federal Government 
under 41 U.S.C. 46-48c and 41 CFR 51-2.4.
    I certify that the following action will not have a significant 
impact on a substantial number of small entities. The major factors 
considered for this certification were:
    1. The action will not result in any additional reporting, 
recordkeeping or other compliance requirements for small entities other 
than the small organizations that will furnish the commodity to the 
Government.
    2. The action does not appear to have a severe adverse impact on 
current contractors for the commodity.
    3. The action will result in authorizing small entities to furnish 
the commodity to the Government.
    4. There are no known regulatory alternatives which would 
accomplish the objectives of the Javits-Wagner-O'Day Act (41 U.S.C. 46-
48C) in connection with the commodity proposed for addition to the 
Procurement List.
    Accordingly, the following commodity is hereby added to the 
Procurement List:

Paper, Tabulating Machine
    7530-00-800-0996

(Requirements for the Palmetto, GA; Fort Worth, TX; and Stockton, CA 
depots only)

    This action does not affect current contracts awarded prior to the 
effective date of this addition or options exercised under those 
contracts.
Beverly L. Milkman,
Executive Director.
[FR Doc. 95-4702 Filed 2-23-95; 8:45 am]
BILLING CODE 6820-33-P