[Federal Register Volume 61, Number 113 (Tuesday, June 11, 1996)]
[Notices]
[Page 29539]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-14713]



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DEPARTMENT OF DEFENSE


Notice of Determination of Need

AGENCY: Department of Defense (DoD).

SUMMARY: The Director of Defense Procurement has determined that a need 
exists to facilitate the private financing of defense contracts, 
particularly contracts to be performed by small businesses, by using 
provisions precluding reductions or setoffs in defense contracts 
containing the Assignment of Claims clause when claims have been 
assigned.

EFFECTIVE DATE: June 11, 1996.

FOR FURTHER INFORMATION CONTACT: Mr. John Galbraith, (703) 697-6710.

SUPPLEMENTARY INFORMATION: Section 2451 of the Federal Acquisition 
Streamlining Act of 1994 amended Section 3737 of the Revised Statutes 
(41 U.S.C. 15) to authorize use of ``no-setoff'' provisions in 
contracts authorizing contractor assignments of claims, upon a 
determination of need. The President delegated the authority to make 
these determinations of need to the Secretaries of Defense and Energy, 
the Administrator of General Services, and the heads of all other 
departments and agencies, and authorized further redelegation.
    A provision in DoD contracts limiting reduction or setoff as 
provided in Section 3737 of the Revised Statutes facilitates the use of 
private financing of DoD contracts, and therefore facilitates the 
participation of businesses, especially small businesses, in the 
procurements of DoD thereby increasing competition in these 
procurements, to the benefit of DoD.
    Pursuant to the Presidential delegation dated October 3, 1995, the 
Secretary of Defense delegation dated February 5, 1996, and the Under 
Secretary of Defense for Acquisition and Technology delegation dated 
February 23, 1996, the Director of Defense Procurement on May 10, 1996, 
made the following determination and ordered its publication in the 
Federal Register in accordance with the authorizing statute:

Determination of Need Under Section 3737 of the Revised Statutes

    Pursuant to section 2451 of the Federal Acquisition Streamlining 
Act of 1994, Public law 103-355 (41 U.S.C. 15), and in accordance with 
the authority delegated to me by the Under Secretary of Defense for 
Acquisition and Technology on February 23, 1996, I determine that a 
need exists to facilitate the private financing of defense contracts, 
particularly contracts to be performed by small businesses. 
Consequently, any contract of the Department of Defense, except any 
such contract under which full payment has been made, may provide or be 
amended without consideration to provide that payments under such 
contract shall not be subject to reduction or setoff.
Michele P. Peterson,
Executive Editor, Defense Acquisition Regulations Council.
[FR Doc. 96-14713 Filed 6-10-96; 8:45 am]
BILLING CODE 5000-04-M