[Federal Register Volume 60, Number 204 (Monday, October 23, 1995)]
[Proposed Rules]
[Pages 54326-54328]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-26159]



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DEPARTMENT OF DEFENSE

48 CFR Parts 204, 215, 216, 232, 233, 235, 239, 246, 252, 253, and 
Appendix C to Chapter 2

[DFARS Case 95-D708]


Defense Federal Acquisition Regulation Supplement; Truth in 
Negotiations Act and Related Changes

AGENCY: Department of Defense (DoD).

ACTION: Proposed rule with request for comment.

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SUMMARY: The Director of Defense Procurement is proposing to amend the 
Defense Federal Acquisition Regulation Supplement (DFARS) to reflect 
recent amendments to the Federal Acquisition Regulation pertaining to 
cost or pricing data requirements.

DATES: Comments on the proposed rule should be submitted in writing to 
the address shown below on or before December 22, 1995 to be considered 
in the formulation of the final rule.

ADDRESSES: Interested parties should submit written comments to: 
Defense Acquisition Regulations Council, PDUSD(A&T)DP(DAR), IMD 3D139, 
3062 Defense Pentagon, Washington, DC 20301-3062. Telefax number (703) 
602-0350. Please cite DFARS Case 95-D708 in all correspondence related 
to this issue.

FOR FURTHER INFORMATION CONTACT:
Mr. Al Winston, Truth in Negotiations Act Team Leader, at (703) 602-
2119. Please cite DFARS Case 95-D708.

SUPPLEMENTARY INFORMATION:

A. Background

    The Federal Acquisition Streamlining Act of 1994, Pub. L. 103-355 
(the Act), provides authorities that streamline the acquisition process 
and minimize burdensome government-unique requirements. Item I of 
Federal Acquisition Circular (FAC) 90-32, published at 60 FR 48206 on 
September 18, 1995, amended the Federal Acquisition Regulation to 
implement requirements of the Act pertaining to the submission of cost 
or pricing data. This rule proposes amendments to the DFARS to conform 
to the FAR amendments published as Item I of FAC 90-32. This rule also 
proposes to delete DFARS language pertaining to work measurement 
systems, as Section 2201(b) of the Act repealed 10 U.S.C. 2406, the 
primary statute covering work measurement systems.

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 rule 
primarily consists of conforming DFARS amendments to reflect existing 
FAR requirements for submission of cost or pricing data. An initial 
regulatory flexibility analysis, therefore, has not been performed. 
Comments from small entities concerning the affected DFARS subparts 
will be considered in accordance with Section 610 of the Act. Such 
comments must be submitted separately and cite DFARS Case 95-D708 in 
correspondence.

C. The Paperwork Reduction Act

    The Paperwork Reduction Act does not apply because the proposed 
rule does not impose recordkeeping or information collection 
requirements which require the approval of the Office of Management and 
Budget under 44 U.S.C. 3501, et seq.

List of Subjects in 48 CFR Parts 204, 215, 216, 232, 233, 235, 239, 
246, 252, 253, and Appendix C

    Government procurement.
Michele P. Peterson,
Executive Editor, Defense Acquisition Regulations Council.

    Therefore, it is proposed that 48 CFR Parts 204, 215, 216, 232, 
233, 235, 239, 246, 252, 253, and Appendix C be amended as follows:
    1. The authority citation for 48 CFR Parts 204, 215, 216, 232, 233, 
235, 239, 246, 252, 253, and Appendix C continues to read as follows:

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

PART 204--ADMINISTRATIVE MATTERS

    2. Section 204.805 is amended by revising paragraph (5) to read as 
follows:


204.805  Disposal of contract files.

* * * * *
    (5) Retain pricing review files, containing documents related to 
reviews of the contractor's price proposals, subject to cost or pricing 
data (see FAR 15.804-2), for six years. It if is impossible to 
determine the final payment date in order to measure the six-year 
period, retain the files for nine years.

PART 215--CONTRACTING BY NEGOTIATION


215.801  [Removed]

    3. Section 215.801 is removed.
    4. Sections 215.804 and 215.804-1 are revised to read as follows:


215.804  Cost or pricing data and information other than cost or 
pricing data.


215.804-1  Prohibition of obtaining cost or pricing data.

    (b) Standards for exceptions from cost or pricing data 
requirements. (1) Adequate price competition. (A) An example of a price 
``based on'' adequate price competition is exercise of a priced option 
in a contract where adequate price competition existed, if the 
contracting officer has determined that the option price is reasonable 
under FAR 17.207(d)
    (B) Dual or multiple source programs.
    (1) In dual or multiple source programs, the determination of 
adequate price competition must be made on a case-by-case basis. 
Contracting officers must exercise deliberation and thorough review in 
making the determination. Even when adequate price competition exists, 
in certain cases it may be appropriate to obtain some data to assist in 
price analysis. 

[[Page 54327]]

    (2) Adequate price competition normally exists when--
    (i) Price are solicited across a full range of step quantities, 
normally including a 0-100 percent split, from at least two offerors 
who are individually capable of producing the full quantity; and
    (ii) The price reasonableness of all prices awarded in clearly 
established on the basis of price analysis (see FAR 15.805-2).
    (3) If price reasonableness cannot be determined on the basis of 
price analysis, including the results of negotiations, the exception at 
FAR 15.804-1(a)(1)(i) from submission of cost or pricing data shall not 
apply.
    (5) Exceptional cases.
    (A) The DoD has exempted the Canadian Commercial Corporation and 
its subcontractors from submission of cost or pricing data on all 
acquisitions.
    (B) The DoD has waived cost or pricing data requirements for 
nonprofit organizations (including educational institutions) on cost-
reimbursement-no-fee contracts. However, the contracting officer shall 
require--
    (1) Submission of information other than cost or pricing data to 
the extent necessary to determine reasonableness of the price and cost 
realism; and
    (2) Cost or pricing data from subcontractors which are not 
nonprofit organizations.


215.804-3  [Removed]

    5. Section 215.804-3 is removed.


215.804-6  [Amended]

    6. Section 215.804-6 is amended by redesignating paragraph 
(b)(2)(A) as (b)(1)(A).


215.804-8  [Amended]

    7. Section 215.804-8 is amended by removing paragraph (1); by 
removing the paragraph (2) designation; and by redesignating paragraphs 
(i) and (ii) as (1) and (2) respectively.
    8. Section 215.805-5 is amended by revising paragraph (a)(1)(A) to 
read as follows:


215.805-5  Field pricing support.

    (a)(1)(A) Contracting officers shall request field pricing reports 
for--
    (1) Fixed-price proposals exceeding the cost or pricing data 
threshold;
    (2) Cost-type proposals exceeding the cost or pricing data 
threshold from offerors with significant estimating system deficiencies 
(see 215.811-70(a) (3) and (c)(2) (i)); or
* * * * *
    9. Section 215.805-70 is amended by revising paragraph (b)(2) to 
read as follows:


215.805-70  Cost realism analysis.

* * * * *
    (b) * * *
    (2) Do not request submission of cost or pricing data.


215.811-70  [Amended]

    10. Section 2125.811-70 is amended by removing the word 
``certified'' in paragraphs (b)(2)(i), (b)(2)(ii), and (h); and by 
removing the last sentence of paragraph (g)(3)(ii).


215.872  [Removed and Reserved]

    11. Section 215.872 is removed and reserved.


215.872-1, 215.872-2, 215.872-3, and 215.872-4  Removed]

    12. Sections 215.872-1, 215.872-2, 215.872-3, and 215.872-4 are 
removed.

PART 216--TYPES OF CONTRACTS


216.203-4  [Amended]

    13. Section 216.203-4 is amended in the first sentence of paragraph 
(d)(xvi) by revising the reference ``Far 15.804-3'' to read ``FAR 
15.804-1''.


216.203-4-70  [Amended]

    14. Section 216.203-4-70 is amended in paragraph (a)(1)(ii) by 
revising the reference ``FAR 15.804-3(c)'' to read ``FAR 15.804-
1(b)(2)''; and in paragraphs (a)(2), (b)(4), and (b)(6) by revising the 
reference ``FAR 15.804-3'' to read ``FAR 15.804-1''.

PART 232--CONTRACT FINANCING


232.502-1-71  [Amended]

    15. Section 232.502-1-71 is amended in paragraph (b)(3) by removing 
the word ``certified'' and by revising the reference ``FAR 15.804-2'' 
to read ``FAR 15.801''.

PART 233--PROTESTS, DISPUTES, AND APPEALS


233.7000  [Amended]

    16. Section 233.7000 is amended in paragraph (d) by revising the 
reference ``FAR 15.804-2(a)(1)(ii)'' to read ``FAR 15.804-
2(a)(1)(iii)''.

PART 235--RESEARCH AND DEVELOPMENT CONTRACTING

    17. Section 235.015-71 is amended in paragraph (i)(4) by revising 
the entry FAR 52.215-27 to read as follows:


235.015-71  Short form research contract (SFRC).

    (i) * * *
    (4) * * *
    FAR 52.215-27 Termination of Defined Benefit Pension Plans (Applies 
if cost or pricing data are required and cost determinations are 
subject to FAR subpart 31.2)
* * * * *

PART 239--ACQUISITION OF INFORMATION RESOURCES

    18. Section 239.7406 is amended by revising paragraph (c) and the 
double asterisked statement at the end of paragraph (f) to read as 
follows:


239.7406  Cost or pricing data.

* * * * *
    (c) Unless prohibited by FAR 15.804-1, contracting officers shall 
obtain certified cost or pricing data when unable to determine that the 
prices are reasonable on the basis of price analysis (see FAR 15.805-
2). * * *
    (f) * * *
    * * * Insert the day, month, and year when price negotiations were 
concluded and price agreement was reached or, if applicable, another 
data agreed upon between the parties.
* * * * *

PART 246--QUALITY ASSURANCE


246.770-1  [Amended]

    19. Section 246.770-1 is amended in paragraph (f)(2)(i) by revising 
the reference ``FAR 15.804-3(c)'' to read ``FAR 15.804-1(a)(1)(ii)''.

PART 252--SOLICITATION PROVISIONS AND CONTRACT CLAUSES


252.215-7000  [Removed and Reserved]

    20. Section 252.215-7000 is removed and reserved.


252.215-7002  [Amended]

    21. Section 252.215-7002 is amended in paragraphs (c)(1) and 
(c)(2)(i) by removing the word ``certified''.


252.216-7000  [Amended]

    22. Section 252.216-7000 is amended in paragraph (a)(2) by revising 
the reference ``FAR 15.804-3'' to read ``FAR 15.804-1''.


252.216-7001  [Amended]

    23. Section 252.216-7001 is amended in paragraph (a)(1)(ii) by 
revising the reference ``FAR 15.804-3'' to read ``FAR 15.804-1''.
    24. Section 252.243-7000 is amended by revising paragraph (c) to 
read as follows:


252.243-7000  Engineering change proposals.

* * * * *
    (c) When the price** of the engineering change is equal to or 
greater than the cost or pricing data threshold, the Contractor shall 
submit--

[[Page 54328]]

    (1) A completed SF 1411, Contract Pricing Proposal Cover Sheet 
(Cost or Pricing Data Required), and
    (2) At the time of agreement on price*, or on another date agreed 
upon between the parties, a signed Certificate of Current Cost or 
Pricing Data.

PART 253--FORMS

    25. Section 253.204-70 is amended by revising paragraph (c)(4)(xi) 
(A), (B) and (C) to read as follows:


253.204-70  DD Form 350, Individual Contracting Action Report.

* * * * *
    (c) * * *
    (4) * * *
    (xi) Block C11, Cost or Pricing Data. * * *
    (A) Code Y--Yes--Obtained. Enter code Y when cost or pricing data 
were obtained for the contracting action (see FAR 15.804-2).
    (B) Code N--No--Not Obtained. Enter code N when cost or pricing 
data were not obtained because data were not required (see FAR 15.804-
2) or an exception was granted (see FAR 15.804-1).
    (C) Code W--Not Obtained--Waived. Enter Code W when cost or pricing 
data were not obtained because the requirement was waived (see FAR 
15.804-1(a)(3) and 215.804-1(b)(5)).
* * * * *

Appendix C--Contractor Purchasing System Reviews

    26. In Appendix C to Chapter 2, Section C-208.3 is amended in the 
second sentence of paragraph (a) by revising the reference ``FAR 
15.804-3(b)'' to read ``FAR 15.804-1(b)''.

[FR Doc. 95-26159 Filed 10-20-95; 8:45 am]
BILLING CODE 5000-04-M