[Federal Register Volume 61, Number 83 (Monday, April 29, 1996)]
[Rules and Regulations]
[Pages 18920-18921]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-10430]



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DEPARTMENT OF DEFENSE
48 CFR Part 32

[FAC 90-38; FAR Case 94-767; Item III]
RIN 9000-AG91


Federal Acquisition Regulation; Assignment of Claims; 
Presidential Delegation

AGENCIES: Department of Defense (DOD), General Services Administration 
(GSA), and National Aeronautics and Space Administration (NASA).

ACTION: Final rule.

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SUMMARY: This final rule is issued pursuant to the Federal Acquisition 
Streamlining Act of 1994 (Public Law 103-355) (FASA) to reflect the 
Presidential delegation of authority to make determinations of need and 
to provide guidance for determinations of need made in accordance with 
the Presidential delegation dated October 3, 1995. This regulatory 
action was subject to Office of Management and Budget review under 
Executive Order 12866, dated September 30, 1993. It is not a major rule 
under 5 U.S.C. 804.

EFFECTIVE DATE: June 28, 1996.

FOR FURTHER INFORMATION CONTACT: Mr. John Galbraith, Finance/Payment 
Team Leader, at (703) 697-6710, in reference to this case. For general 
information, contact the FAR Secretariat, Room 4037, 18th & F Streets 
NW., Washington, DC 20405, (202) 501-4755. Please cite FAC 90-38, FAR 
Case 94-767 in all correspondence related to this case.

SUPPLEMENTARY INFORMATION:

A. Background

    The statutes authorizing assignments of claims under Federal 
contracts provide authority for the Government to make no-setoff 
commitments under certain conditions. FASA established a requirement 
for a determination of need by the President. Implementation was 
published in the Federal Register, at 60 FR 49729, on September 26, 
1995, as FAR Case 94-761. The President, on October 3, 1995, delegated 
the authority to make determinations of need to the Secretaries of 
Defense and Energy, the Administrator of General Services, and the 
heads of all other departments or agencies, subject to such additional 
guidance as provided by the Administrator of the Office of Federal 
Procurement Policy. The Administrator of Procurement Policy, in 
accordance

[[Page 18921]]

with the President's delegation, has provided guidance for exercise of 
the authority delegated by the President to make determinations of need 
to make no-setoff commitments under contracts containing assignment of 
claims clauses. Because this guidance is administrative in nature and 
has no significant impact upon the public, it is being published as a 
final rule.

B. Regulatory Flexibility Act

    As noted above, this rule implements a change in authority for 
existing policy and procedures in the FAR. This change in authority to 
be cited does not change the usage of the procedure (the no-setoff 
commitment) or the impact upon small entities. Thus, this final rule 
does not constitute a significant FAR revision within the meaning of 
FAR 1.501 and Public Law 98-577, and publication for public comments is 
not required. Therefore, the Regulatory Flexibility Act does not apply. 
However, comments from small entities concerning the affected FAR 
subpart will be considered in accordance with Section 610 of the Act. 
Such comments must be submitted separately and cite 5 U.S.C. 601 et 
seq., (FAC 90-38, FAR Case 94-767) in correspondence.

C. Paperwork Reduction Act

    The Paperwork Reduction Act does not apply because the changes to 
the FAR do not impose recordkeeping or information collection 
requirements, or collections of information from offerors, contractors, 
or members of the public 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 Part 32

    Government procurement.

    Dated: April 18, 1996.
Edward C. Loeb,
Deputy Project Manager for the Implementation of the Federal 
Acquisition Streamlining Act of 1994.

    Therefore, 48 CFR Part 32 is amended as set forth below:

PART 32--CONTRACT FINANCING

    1. The authority citation for 48 CFR Part 32 continues to read as 
follows:

    Authority: 40 U.S.C. 486(c); 10 U.S.C. chapter 137; and 42 
U.S.C. 2473(c).

    2. Section 32.803 is amended by revising paragraph (d) to read as 
follows:


32.803   Policies.

* * * * *
    (d) Any contract of a designated agency (see FAR 32.801), except a 
contract under which full payment has been made, may include a no-
setoff commitment only when a determination of need is made by the head 
of the agency, in accordance with the Presidential delegation of 
authority dated October 3, 1995, and after such determination has been 
published in the Federal Register. The Presidential delegation makes 
such determinations of need subject to further guidance issued by the 
Office of Federal Procurement Policy. The following guidance has been 
provided: Use of the no-setoff provision may be appropriate to 
facilitate the national defense; in the event of a national emergency 
or natural disaster; or when the use of the no-setoff provision may 
facilitate private financing of contract performance. However, in the 
event an offeror is significantly indebted to the United States, the 
contracting officer should consider whether the inclusion of the no-
setoff commitment in a particular contract is in the best interests of 
the United States. In such an event, the contracting officer should 
consult with the Government officer(s) responsible for collecting the 
debt(s).
* * * * *
    Section 32.806 is amended by revising paragraph (a)(2) to read as 
follows:


32.806   Contract clause.

    (a) * * *
    (2) If a no-setoff commitment has been authorized (see FAR 
32.803(d)), the contracting officer shall use the clause with its 
Alternate I.
* * * * *
[FR Doc. 96-10430 Filed 4-26-96; 8:45 am]
BILLING CODE 6820-EP-P