[Federal Register Volume 61, Number 210 (Tuesday, October 29, 1996)]
[Rules and Regulations]
[Pages 55753-55764]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-26337]


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NATIONAL AERONAUTICS AND SPACE ADMINISTRATION

48 CFR Parts 1817, 1822, 1823, 1824, 1852, and 1871


Rewrite of the NASA FAR Supplement (NFS)

AGENCY: Office of Procurement, National Aeronautics and Space 
Administration (NASA).

ACTION: Final rule.

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SUMMARY: As part of the National Performance Review initiative to 
streamline and clarify regulations, NASA is issuing a rewrite of those 
regulations in its Federal Acquisition Regulations Supplement relating 
to special contracting methods (part 1817); the application of labor 
laws to Government acquisitions (part 1822); environment, conservation, 
occupational safety, and drug-free workplace (part 1823); and the 
protection of privacy and freedom of information (part 1824). In 
addition, regulations on midrange procurement procedures (part 1871) 
are revised to increase certain dollar thresholds and to make other 
changes to comply with the Federal Acquisition Streamlining Act.

DATES: This rule is effective October 29, 1996.

ADDRESSES: Bruce King, Code HC, NASA Headquarters, 300 E Street, SW, 
Washington, DC 20546-0001; Tom O'Toole, Code HC, NASA Headquarters, 300 
E Street, SW, Washington, DC 20546-0001.

FOR FURTHER INFORMATION CONTACT: Mr. Thomas O'Toole, (202) 358-0478; 
Mr. Bruce King, (202) 358-0461.

SUPPLEMENTARY INFORMATION:

Background

    The National Performance Review urged agencies to streamline and 
clarify their regulations. The NFS rewrite initiative was established 
to pursue these goals by conducting a section by section review of the 
NFS to verify its accuracy, relevancy, and validity. The NFS will be 
rewritten in blocks of parts and upon completion of all parts, the NFS 
will be reissued in a new edition. In addition, Part 1871 is revised to 
increase the dollar thresholds to which MidRange is applicable and to 
bring MidRange into compliance with the changes made to commercial item 
acquisition made by the Federal Acquisition Streamlining Act. Comments 
on the test procedure had been requested in 57 FR 57845, December 7, 
1992.

Impact

    NASA certifies that this regulation will not have a significant 
economic impact on a substantial number of small entities under the 
Regulatory Flexibility Act (5 U.S.C. 601 et seq.). This rule does not 
impose any reporting or record keeping requirements subject to the 
Paperwork Reduction Act.

List of Subjects in 48 CFR Parts 1817, 1822, 1823, 1824, 1852, and 1871

    Government procurement.
Thomas Luedtke,
Deputy Associate Administrator for Procurement.

    Accordingly, 48 CFR chapter 18 is amended as follows:
    1.-2. Part 1817 is revised to read as follows:

PART 1817--SPECIAL CONTRACTING METHODS

Sec.

Subpart 1817.1--Multiyear Contracting

1817.105  Policy.
1817.105-1  Uses.

Subpart 1817.2--Options

1817.200  Scope of subpart.
1817.203  Solicitations.
1817.204  Contracts.
1817.206  Evaluation.
1817.207  Exercise of options.
1817.208  Solicitation provisions and contract clauses.

Subpart 1817.4--Leader Company Contracting

1817.401  General.

Subpart 1817.5--Interagency Acquisitions Under the Economy Act

1817.503  Determinations and findings requirements.
1817.504  Ordering procedures.

Subpart 1817.70--Acquisitions With Military Departments

1817.7000  Scope of subpart.
1817.7001  Authorization and policy.
1817.7002  NASA-Defense Purchase Request and acceptance.
1817.7002-1  Acceptance by Military Department.
1817.7002-2  Changes in estimated total prices.
1817.7002-3  Payments.
1817.7002-4  Contract clause.

Subpart 1817.71--Exchange or Sale of Personal Property

1817.7101  Policy.

    Authority: 42 U.S.C. 2473(c)(1)

Subpart 1817.1--Multiyear Contracting


1817.105  Policy.


1817.105-1  Uses. (NASA supplements paragraph (b))

    (b) The Associate Administrator for Procurement (Code HS) is the 
approval authority for the use of the multiyear contracting technique. 
Requests for approval shall be signed by the procurement officer and 
shall include a description of the acquisition, identification of 
anticipated contract costs and funding, and a determination, with 
supporting rationale, that each of the criteria in FAR 17.105-1(b) (1) 
through (5) is met by the proposed use of multiyear contracting.

Subpart 1817.2--Options


1817.200  Scope of subpart.

    FAR subpart 17.2 applies to all NASA contracts.


1817.203  Solicitations. (NASA supplements paragraph (g))

    (g)(2) The procurement officer is authorized to approve option 
quantities greater than 50 percent.


1817.204  Contracts. (NASA supplements paragraph (e))

    (e)(i) The 5-year limitation (basic plus option periods) does not 
apply when the time needed to complete system development or hardware 
production is greater than five years.
    (ii) Requests for deviations from the 5-year limitation policy 
shall be sent to the Associate Administrator for Procurement (Code HS) 
and shall include justification for exceeding five years and evidence 
that the extended years can be reasonably priced.


1817.206  Evaluation. (NASA supplements paragraph (b))

    (b)(i) The procurement officer is the approval authority for 
determinations by the contracting officer not to evaluate offers for 
any option quantities or periods.
    (ii) Unless a determination has been approved under 1817.206(b)(i), 
the selection statement for each acquisition involving an option shall 
address the source selection authority's consideration of the option as 
part of the initial competition.


1817.207  Exercise of options. (NASA supplements paragraph (f))

    (f) Options under cost type contracts shall contain an estimated 
cost for the option period(s).
    (f)(2) Use of the provision (or formula) for determining the price 
of a fixed price option requires advance approval by the

[[Page 55754]]

Associate Administrator for Procurement (Code HS).
    (f)(3)(ii) Use of a formula to determine the fee of an option in a 
cost-type contract requires advance approval of the Associate 
Administrator for Procurement (Code HS). The formula shall preclude the 
contractor from increasing costs for the purpose of earning additional 
fee.


1817.208  Solicitation provisions and contract clauses. (NASA 
supplements paragraph (c))

    (c)(3) The contracting officer shall insert a provision 
substantially the same as FAR 52.217-5 in cost reimbursement contracts 
when the other conditions of FAR 17.208(c) are met.

Subpart 1817.4--Leader Company Contracting


1817.401  General.

    It is NASA policy not to use the leader company contracting 
technique.

Subpart 1817.5--Interagency Acquisitions Under the Economy Act


1817.503  Determinations and findings requirements. (NASA supplements 
paragraph (a))

    (a)(2) Current market prices, recent acquisition prices, or prices 
obtained by informational submissions as provided in FAR 15.405 may be 
used to ascertain whether the acquisition can be accomplished more 
economically from commercial sources.


1817.504  Ordering procedures. (NASA supplements paragraph (b))

    (b)(4) All payment provisions shall require the servicing agency or 
department to submit a final voucher, invoice, or other appropriate 
payment document within six months after the completion date of the 
order. A different period may be specified by mutual agreement if six 
months is not sufficient. The rationale for a longer period shall be 
documented in the contract file.

Subpart 1817.70--Acquisitions With Military Departments


1817.7000  Scope of subpart.

    This subpart contains policies and procedures, developed jointly by 
NASA and DOD, for acquisition of supplies or services by NASA from or 
through the Military Departments.


1817.70001  Authorization and policy.

    (a)(1) NASA is authorized by the National Aeronautics and Space Act 
of 1958 (42 U.S.C. 2451 et seq.) to use the acquisition services, 
personnel, equipment, and facilities of the Military Departments, with 
their consent and with or without reimbursement, and, on a similar 
basis, to cooperate with the Military Departments in the use of 
acquisition services, equipment, and facilities.
    (2) Although the Space Act provides interagency transaction 
authority nearly equivalent to the Economy Act, NASA has elected to 
conform its implementation of the Space Act to the requirements of the 
Economy Act. Therefore, unless exempt from the Economy Act for reasons 
other than the general authority of the Space Act, interagency 
acquisitions shall be supported by an Economy Act Determination and 
Finding (see FAR 17.503 and 1817.503). This requirement applies to all 
acquisitions from the Military Departments or other agencies.
    (b) The Military Departments have agreed to cooperate fully with 
NASA in making their acquisition services, equipment, personnel, and 
facilities available on the basis of mutual agreement.
    (c) The Military Departments have agreed not to claim reimbursement 
for administrative costs incident to acquisitions for NASA, except as 
may be otherwise agreed before the services are performed.
    (d) When procuring supplies or services for NASA or performing 
field service functions in support of NASA contracts, the Military 
Departments have agreed to use their own methods, except when otherwise 
required by the terms of the agreement involved.
    (e) The Military Departments normally will use their own funds when 
procuring supplies or services or performing services for NASA, and 
will not cite NASA funds on any Defense obligation or payment document.


1817.7002  NASA-Defense Purchase Request and acceptance.

    (a) The NASA-Defense Purchase Request (NASA Form 523) shall be used 
by NASA contracting offices for requesting acquisition of supplies or 
services from all activities of the Military Departments. Individual 
NASA-Defense Purchase Requests shall be prepared in accordance with the 
instructions on the reverse of NASA Form 523 and shall be numbered in 
accordance with subpart 1804.71. The form shall not be used for 
requesting--
    (1) Block transfers of excess property between NASA and the 
Military Departments;
    (2) Performance by the Military Departments of field service 
functions related to NASA contracts; or
    (3) Items that the Military Departments normally purchase and stock 
for military use or in-house service, except when a DOD activity is 
willing to accept the form for these purposes. Supplies and services of 
this nature may be requisitioned using appropriate DOD forms when they 
are provided by and are acceptable to or preferred by the Military 
Department supplying activity or as otherwise mutually agreed upon by 
the parties.
    (b) The contracting officer shall include a provision in the order 
in accordance with 1817.504(b)(4).
    (c) To obtain materials from the Air Force Missile Procurement 
Fund, the contracting officer shall follow the procedures of 1808.002-
72.


1817.7002-1  Acceptance by Military Department.

    (a) Except as provided in paragraph (c) of this section, the 
Military Department concerned will, within 30 days after receipt of a 
NASA-Defense Purchase Request, forward to the initiator of the request 
an Acceptance of MIPR, DD Form 448-2. Each DD Form 448-2 will show the 
action being taken to fill the requirement and the name and complete 
address of the DOD contracting activity.
    (b) To the extent feasible, all documents (including acceptances, 
contracts, correspondence, shipping documents, work or project orders, 
and Standard Form 1080 (Voucher for Transfer between Appropriations 
and/or Funds) billings) will reference the NASA-Defense Purchase 
Request number and the item number.
    (c) Acceptance by the Military Department is not required for NASA-
Defense Purchase Requests covering deliveries of common-use standard-
stock items that the supplying agency has on hand or on order for 
prompt delivery at published prices.


1817.7002-2  Changes in estimated total prices.

    When a Military Department determines that the estimated total 
price (Block 7, NASA Form 523) of the items to be acquired for NASA is 
not sufficient to cover the required reimbursement or is in excess of 
the amount required, a request for an amendment will be forwarded to 
the NASA originating office. The request will indicate a specific 
dollar amount, rather than a percentage, and will include justification 
for any upward adjustment requested. Upon approval of the request, the 
cognizant NASA contracting office shall forward to the DOD contracting 
activity an amendment to the NASA Defense Purchase Request.

[[Page 55755]]

1817.7002-3  Payments.

    Except when agreements provide that reimbursement is not required, 
payments to the Military Departments shall be made by that NASA office 
designated in block 9 of the NASA-Defense Purchase Request upon receipt 
of Standard Form 1080. Billings will be supported in the same manner as 
billings between Military Departments.


1817.7002-4  Contract clause.

    The contracting officer shall insert the clause at 1852.217-70, 
Property Administration and Reporting, in any NASA-Defense Purchase 
Request when property will be involved.

Subpart 1817.71--Exchange or Sale of Personal Property


1817.7101  Policy.

    (a) Section 201(c) of the Federal Property and Administrative 
Services Act of 1949, 63 Stat. 384, as amended (40 U.S.C. 481(c)), 
authorizes the exchange or sale of Government personal property and the 
application of the exchange allowance or proceeds from the sale to the 
acquisition of similar property for replacement purposes. The 
transaction must be evidenced in writing.
    (b) NASA installations and contractors are authorized to conduct 
exchange/sale transactions as long as the requirements and restrictions 
of NHB 4300.1 and the Federal Property Management Regulations, 
Subchapter H, part 101-46, are followed. In conducting such exchanges/
sales, NASA contractors must obtain the contracting officer's prior 
written approval and must report the transactions to the cognizant NASA 
installation Property Disposal Officer (PDO).
    3. Part 1822 is revised to read as follows:

PART 1822--APPLICATION OF LABOR LAWS TO GOVERNMENT ACQUISITIONS

1822.000-70  Scope of part.

Subpart 1822.1--Basic Labor Policies

1822.101  Labor relations.
1822.101-1  General.
1822.101-3  Reporting labor disputes.
1822.101-4  Removal of items from contractors' facilities affected 
by work stoppages.
1822.101-70  Admission of labor representatives to contract sites.
1822.103  Overtime.
1822.103-4  Approvals.

Subpart 1822.3--Contract Work Hours and Safety Standards Act

1822.302  Liquidated damages and overtime pay.

Subpart 1822.4--Labor Standards for Contracts Involving Construction

1822.400-70  Contracts with the Department of Labor.
1822.404-3  Procedures for requesting wage determinations.
1822.406-8  Investigations.
1822.406-9  Withholding from or suspension of contract payments.
1822.406-13  Semiannual enforcement reports.

Subpart 1822.6--Walsh-Healey Public Contracts Act

1822.604  Exemptions.
1822.604-2  Regulatory exemptions.
1822.608  Procedures.
1822.608-4  Award pending final determination.

Subpart 1822.8--Equal Employment Opportunity

1822.804  Affirmative action programs.
1822.804-2  Construction.
1822.807  Exemptions.
1822.810  Solicitation provisions and contract clauses.

Subpart 1822.10--Service Contract Act of 1965

1822.1001  Definitions.
1822.1008  Procedures for preparing and submitting Notice (SF 98/
98a).
1822.1008-270  Additional information for the preparation of SF 98/
98a.
1822.1008-7  Required time of submission of Notice.

Subpart 1822.13--Special Disabled and Vietnam ERA Veterans

1822.1303  Waivers.
1822.1306  Complaint procedures.

Subpart 1822.14--Employment of the Handicapped

1822.1403  Waivers.
1822.1406  Complaint procedures.

    Authority: 42 U.S.C. 2473(c)(1).


1822.000-70   Scope of part.

    (a) Contracting officers shall consult with the installation labor 
relations advisor or designee when taking any of the actions prescribed 
or authorized in FAR part 22 or part 1822.
    (b) Proposed actions having a substantial impact on the activities 
of NASA or other Government agencies shall be approved by the 
Headquarters Contractor Industrial Relations Office (Code JLR).

Subpart 1822.1--Basic Labor Policies


1822.101   Labor relations.


1822.101-1   General. (NASA supplements paragraph (d))

    (d) When a strike that may have an adverse effect on NASA programs 
is imminent or in progress at a prime contractor's or subcontractor's 
plant, contracting officers shall:
    (i) Advise both the prime contractor and the head of the union 
local in writing of the expected impact of the strike on NASA programs 
and of the actions NASA is considering to protect the Government's 
interest and prevent delay in the accomplishment of NASA's mission. If 
the strike is in a subcontractor's plant, the subcontractor may be 
approached only through the prime contractor;
    (ii) Explore the possibility of locating other sources for the 
supplies or services to have been provided by the strike-threatened 
plant; and
    (iii) Consider taking the actions described in FAR 22.101-4.


1822.101-3   Reporting labor disputes.

    Reports of potential or actual labor disputes affecting NASA 
acquisitions, operations, or services shall be submitted to the 
Headquarters Contractor Industrial Relations Office (Code JLR). These 
reports shall be made as early as possible and shall include 
immediately available information. Supplemental reports shall be made 
to provide appropriate additional information. Reports shall described 
at a minimum:
    (1) The nature of the potential or actual dispute, including 
whether a strike, lockout, slow-down, shut-down, or picketing is 
involved and the degree of emergency presented;
    (2) The character, quantity, and importance of the supplies, 
operations, or services involved, including scheduled performance and 
delivery dates and their relationship to the total acquisition program;
    (3) The identity and location of the parties to the dispute and 
their representatives, including the approximate number of employees 
involved;
    (4) The need for and availability of alternative resources to 
furnish the items involved within the time required;
    (5) Any critical items that should be removed from the plant or 
work site or should continue to be processed there with the consent of 
the parties to the dispute; and
    (6) Recommended action to be taken by NASA.


1822.101-4   Removal of items from contractors' facilities affected by 
work stoppages. (NASA supplements paragraph (a))

    (a) (3) The contracting officer shall obtain approval from Code JLR 
for any contemplated action.

[[Page 55756]]

1822.101-70   Admission of labor representatives to contract sites.

    NASA activities may not prevent the access of labor union 
representatives to contract sites for the conduct of union business if 
their activities are compatible with safety and security regulations 
and performance of the contract work involved.


1822.103   Overtime.


1822.103-4   Approvals. (NASA supplements paragraph (a))

    (a) The contracting officer is authorized to approve overtime 
premiums at Government expense. If two or more contracting offices have 
current contracts at a single facility and approval of overtime by one 
will affect the performance or cost of contracts of another, the 
approving official shall obtain the concurrence of other appropriate 
approving officials and seek agreement as to the contracts under which 
premiums will be approved. In the absence of evidence to the contrary, 
a contracting officer may rely on the contractor's statement that 
approval will not affect performance or payments under any contract of 
another contracting office.

Subpart 1822.3--Contract Work Hours and Safety Standards Act


1822.302   Liquidated damages and overtime pay. (NASA supplements 
paragraphs (c) and (d))

    (c) The Director of the Headquarters Contractor Industrial 
Relations Office (Code JLR) is the agency head designee.
    (d) Disposal of funds withheld or collected for liquidated damages 
shall be in accordance with direction of the Director of Code JLR.

Subpart 1822.4--Labor Standards for Contracts Involving 
Construction


1822.400-70   Contacts with the Department of Labor.

    All contacts with the Department of Labor required by FAR subpart 
22.4 shall be conducted through the Headquarters Contractor Industrial 
Relations Office (Code JLR). Contracting officers shall submit all 
pertinent information to Code JLR in support of the required contacts.


1822.404-3   Procedures for requesting wage determinations.

    Contracting officers shall submit requests for project wage 
determinations to Code JLR at least 55 days (70 days if possible) 
before issuing the solicitation.


1822.406-8  Investigations. (NASA supplements paragraphs (a) and (d))

    (a) The contracting officer is responsible for conducting 
investigations of labor violations relative to contracts under his/her 
cognizance.
    (d) Reports of violations shall be sent to Code JLR.


1822.406-9  Withholding From or suspension of contract payments. (NASA 
supplements paragraph (c))

    (c)(4) Code JLR shall determine the disposal of funds.


1822.406-13  Semiannual enforcement reports.

    Procurement officers shall submit semiannual enforcement data 
within 20 days after the end of the specified reporting periods to the 
Headquarters Office of Procurement (Code HK). Negative statements are 
required.

Subpart 1822.6--Walsh-Healey Public Contracts Act


1822.604  Exemptions.


1822.604.-2  Regulatory exemptions. (NASA supplements paragraph (c))

    (c) Requests for exemptions shall be submitted in writing through 
the contracting officer to the Headquarters Contractor Industrial 
Relations Office (Code JLR).


1822.608  Procedures.

    All contacts with other agencies required by FAR 22.608 shall be 
conducted through Code JLR. Contracting officers shall submit all 
pertinent information to Code JLR in support of the required contacts.


1822.608-4  Award pending final determination. (NASA supplements 
paragraph (b))

    (b)(1) The procurement officer shall approve, with the concurrence 
of Code JLR, certifications for immediate award.
    (2) Code JLR will notify other agencies of the determination to 
award, and the contracting officer shall notify the protester.

Subpart 1822.8--Equal Employment Opportunity


1822.804  Affirmative action programs.


1822.804-2  Construction. (NASA supplements paragraph (b))

    (b) The Headquarters Office of Procurement (Code HK) will furnish 
each procurement officer the listing.


1822.807  Exemptions.

    Requests for exemption pursuant to FAR 22.807(a)(1), (a)(2), or 
(b)(5) shall be sent to the Headquarters Office of Procurement (Code 
HS).


1822.810  Solicitation provisions and contract clauses. (NASA 
supplements paragraph (e))

    (e) If an offeror completes a negative representation under FAR 
52.222-22, the contracting officer shall obtain the information 
required by FAR 52.222-26(b)(7) within 30 days of contract award. The 
information shall be held in confidence as privileged information in 
accordance with 32 CFR 286.6(b)(4).

Subpart 1822.10--Service Contract Act of 1965


1822.1001  Definitions.

    Agency labor advisor is the Director of the Headquarters Contractor 
Industrial Relations Office (Code JLR). All contacts with other 
agencies required by FAR subpart 22.10 shall be conducted through Code 
JLR. Contracting officers shall submit all pertinent information to 
Code JLR in support of the required contacts.


1822.1008  Procedures for preparing and submitting Notice (SF 98/98a).


1822.1008-270  Additional information for the preparation of SF 98/98a.

    The information listed in this section by item number shall be 
furnished, in addition to that required by the SF 98/98a:
    (a) Item 6. Insert on the far left side of the block the code 
identifying the type of proposed action:

------------------------------------------------------------------------
             Code                            Proposed action            
------------------------------------------------------------------------
I                               New contract (use only when services are
                                 not presently being performed).        
II                              Recompetition of services.              
III                             Contract modifications affecting the    
                                 scope of the work.                     
IV                              Extension of contract performance       
                                 through exercise of an option or       
                                 otherwise.                             
 V                              Other. When a multiple year contract    
                                 (funding is not subject to annual      
                                 appropriation) is to be entered into,  
                                 specify ``multiple year R&D funded'' on
                                 the SF 98.                             
------------------------------------------------------------------------

    (b) Item 8. (1) If the proposed contract will be awarded under 
Section 8(a) of the Small Business Act, insert both the Small Business 
Administration and the name of the subcontractor.
    (2) If no wage determination is available for the particular 
contract, insert ``None'' in Item 8.b.
    (c) Item 10. Add the solicitation number.
    (d) Item 12. (1) When entering into a new service contract, list 
all classes of work expected to be performed under

[[Page 55757]]

the contract under this item, regardless of whether the class of 
employees is considered professional, executive, administrative, or 
hourly. However, if submission of the SF 98/98a is in connection with 
any action other than a new contract (Code I in paragraph (a) of this 
subsection), list only the classes of work that the incumbent indicates 
are ``nonexempt.''
    (2) When classifications include both categories of employees 
covered by a collective bargaining agreement and those not represented 
by a union, mark the classifications that are unionized with an 
asterisk.
    (3) If the classification of work is not known, use the most 
descriptive job title available for the work to be performed under the 
contract.
    (e) Item 13. If the number of employees is not known, the estimated 
hours required to perform the tasks should be indicated so that 
staffing estimates can be determined and listed.
    (f) Item 14. Include in this item the wage rates that would be paid 
if the employees were subject to 5 U.S.C. 5332 (GS grades).


1822.1008-7  Required time of submission of Notice. (NASA supplements 
paragraphs (a), (b), (c), and (d))

    (a) Contracting officers shall submit the notices to Code JLR at 
least 70 days before initiating the associated contract actions.
    (b) When the circumstances in FAR 22.1008-7(b) apply, contracting 
officers shall submit the required notices to Code JLR at least 40 days 
before initiating the associated contract actions.
    (c) Contracting officers shall contact Code JLR before initiating 
any action when the circumstances in FAR 22.1008-7(c) and (d) apply.
    (d) See paragraph (c) of this section.

Subpart 1822.13--Special Disabled and Vietnam Era Veterans


1822.1303  Waivers. (NASA supplements paragraph (c))

    (c) Requests for waivers shall be submitted to the Associate 
Administrator for Equal Opportunity Programs (Code E).


1822.1306  Complaint procedures.

    Contracting officers shall submit all complaints to the Associate 
Administrator for Equal Opportunity Programs (Code E).

Subpart 1822.14--Employment of the Handicapped


1822.1403  Waivers. (NASA supplements paragraph (c))

    (c) Requests for waivers shall be submitted to the Associate 
Administrator for Equal Opportunity Programs (Code E).


1822.1406  Complaint procedures.

    Contracting officers shall submit all complaints to the Associate 
Administrator for Equal Opportunity Programs (Code E).
    4. Part 1823 is revised to read as follows:

PART 1823--ENVIRONMENT, CONSERVATION, OCCUPATIONAL SAFETY, AND 
DRUG-FREE WORKPLACE

Sec.

Subpart 1823.1--Pollution Control and Clean Air and Water

1823.106  Delaying award.
1823.107  Compliance responsibilities.

Subpart 1823.3--Hazardous Material Identification and Material Safety 
Data

1823.370  Acquisition of potentially hazardous items from or through 
another Government agency.

Subpart 1823.5--Drug-Free Workplace

1823.570  Drug- and alcohol-free workforce.
1823.570-1  Scope.
1823.570-2  Definitions.
1823.570-3  Contract clause.
1823.570-4  Suspension of payments, termination of contract, and 
debarment and suspension actions.

Subpart 1823.70--Safety and Health

1823.7001  NASA contract clauses.

Subpart 1823.71--Frequency Authorization

1823.7101  Contract clause.
1823.7102  Procedures.

    Authority: 42 U.S.C. 2473(c)(1)

Subpart 1823.1--Pollution Control and Clean Air and Water


1823.106  Delaying award. (NASA supplements paragraph (a))

    (a) Notifications shall be submitted through the procurement 
officer and the Associate Administrator for Procurement (Code HS).


1823.107  Compliance responsibilities.

    Notifications under FAR 23.107 shall be submitted through the same 
channels as under 1823.106.

Subpart 1823.3--Hazardous Material Identification and Material 
Safety Data


1823.370   Acquisition of potentially hazardous items from or through 
another Government agency.

    When acquiring supplies or services from or through another 
Government agency (e.g., see FAR part 8 and FAR subpart 17.5), NASA 
shall request that agency to furnish NASA the data required by FAR 
subpart 23.3.

Subpart 1823.5--Drug-Free Workplace


1823.570   Drug- and alcohol-free workforce.


1823.570-1   Scope.

    Sections 1823.570 through 1823.570-4 set forth NASA requirements 
for mandatory drug and alcohol testing of certain contractor personnel 
under section 203, National Aeronautics and Space Act of 1958, as 
amended, 42 U.S.C. 2473, 72 Stat. 429; and Civil Space Employee Testing 
Act of 1991, Public Law 102-195, sec. 21, 105 Stat. 1616 to 1619.


1823.570-2   Definitions.

    As used in this subpart employee and controlled substance are as 
defined in FAR 23.503. The use of a controlled substance in accordance 
with the terms of a valid prescription, or other uses authorized by law 
shall not be subject to the requirements of 1823.570 through 1823.570-4 
and the clause at 1852.223-74.
    Employee in a sensitive position means a contractor or 
subcontractor employee who has been granted access to classified 
information; a contractor or subcontractor employee in other positions 
that the contractor or subcontractor determines could reasonably be 
expected to affect safety, security, National security, or functions 
other than the foregoing requiring a high degree of trust and 
confidence; and includes any employee performing in a position 
designated ``mission critical'' pursuant to the clause at 1852.246-70. 
The term also includes any applicant who is interviewed for a position 
described in this paragraph.
    Use, in violation of applicable law or Federal regulation, of 
alcohol includes having, while on duty or during a preemployment 
interview, an alcohol concentration of 0.04 percent by weight or more 
in the blood, as measured by chemical test of the individual's breath 
or blood. An individual's refusal to submit to such test is presumptive 
evidence of use, in violation of applicable law or Federal regulation, 
of alcohol.


1823.570-3   Contract clause.

    The contracting officer shall insert the clause at 1852.223-74, 
``Drug- and Alcohol-Free Workforce,'' in all solicitations and 
contracts containing the clause at 1852.246-70, ``Mission Critical 
Space Systems Personnel Reliability Program,'' and in other 
solicitations and contracts exceeding $5 million in which work is 
performed by an employee in a sensitive position. However, the 
contracting officer shall not insert the clause at 1852.223-74 in

[[Page 55758]]

solicitations and contracts for commercial items (see FAR parts 2 and 
12).


1823.570-4   Suspension of payments, termination of contract, and 
debarment and suspension actions.

    The contracting officer shall comply with the procedures of FAR 
23.506 regarding the suspension of contract payments, the termination 
of the contract for default, and debarment and suspension of a 
contractor relative to failure to comply with the clause at 1852.223-
74. Causes for suspension of contract payments, termination of the 
contract for default, and debarment and suspension of the contractor 
are the following:
    (a) The contractor fails to comply with paragraph (b), (c), or (d) 
of the clause at 1852.223-74; or
    (b) Such a number of contractor employees in sensitive positions 
having been convicted of violations of criminal drug statutes or 
substantial evidence of drug or alcohol abuse or misuse occurring in 
the workplace, as to indicate that the contractor has failed to make a 
good faith effort to provide a drug- and alcohol-free workforce.

1823.70--Safety and Health


1823.7001   NASA contract clauses.

    (a) Except as provided in paragraph (b) of this section, the clause 
at 1852.223-70 shall be included in--
    (1) All negotiated contracts of $1,000,000 or more;
    (2) All construction, repair, or alteration contracts in excess of 
the simplified acquisition threshold;
    (3) All contracts having, within their total requirement, 
construction, repair, or alteration tasks in excess of the simplified 
acquisition threshold; and
    (4) Any acquisition regardless of dollar amount when:
    (i) Any deliverable contract end item is of a hazardous nature, or
    (ii) During the life of the contract it can reasonably be expected 
that hazards will be generated within the operational environment and 
the contracting officer determines that they warrant inclusion of the 
clause.
    (b) The clause prescribed in paragraph (a) of this section may be 
excluded
    (1) From any contract subject to the Walsh-Healey Public Contracts 
Act (see FAR subpart 22.6) or the Service Contract Act of 1965 (see FAR 
subpart 22.10) in which the application of the act and its implementing 
regulations constitute adequate safety and health protection;
    (2) When the contracting officer makes a written determination that 
the clause is not necessary under the circumstances of the acquisition, 
and;
    (3) Exclusion of the clause is approved by the installation safety 
and health official.
    (c) The contracting officer shall insert the provision at 1852.223-
73, Safety and Health Plan, in solicitations containing the clause at 
1852.223-70, when a Safety and Health Plan is to be submitted with the 
offeror's proposal. This clause may be modified to identify specific 
information that is to be included in the plan. The contracting officer 
shall include the approved plan in any resulting contract.
    (d) When the installation safety and health official recommends 
that a Safety and Health Plan be submitted by the apparently successful 
offeror after notification of selection but before contract award, the 
provision at 1852.223-73 shall be used with its Alternate I.

Subpart 1823.71--Frequency Authorization


1823.7101  Contract clause.

    The contracting officer shall insert the clause at 1852.223-71, 
Frequency Authorization, in solicitations and contracts calling for 
developing, producing, constructing, testing, or operating a device for 
which a radio frequency authorization is required.


1823.7102  Procedures.

    The contracting officer shall obtain the necessary frequency 
authorization and other procedural details from the installation's 
spectrum manager.
    5. Part 1824 is revised to read as follows:

PART 1824--PROTECTION OF PRIVACY AND FREEDOM OF INFORMATION

Subpart 1824.1--Protection of Individual Privacy

1824.102  General.

Subpart 1824.2--Freedom of Information Act

1824.202  Policy.

    Authority: 42 U.S.C. 2473(c)(1).

Subpart 1824.1--Protection of Individual Privacy


1824.102  General.

    (1) For NASA rules and regulations implementing the Privacy Act, 
see Privacy--NASA Regulations, (14 CFR 1212). The Act applies to any 
contractor maintaining a system of records to accomplish a NASA 
mission.
    (2) Systems of records to which the Privacy Act does not apply 
include--
    (i) Records maintained by a contractor on individuals employed by 
the contractor on its own behalf for the purpose of providing supplies 
and services to the Federal Government; and
    (ii) Records that--
    (A) Are maintained under contracts with educational institutions to 
provide training;
    (B) Are generated on students working under the contract relative 
to their attendance (admission forms, grade reports, etc.);
    (C) Are similar to those maintained on other students; and
    (D) Are commingled with their records on other students.

Subpart 1824.2--Freedom of Information Act


1824.202  Policy. (NASA supplements paragraphs (a) and (b))

    (a) For NASA implementation of the Freedom of Information Act, see 
Availability of Agency Records to Members of the Public (14 CFR part 
1206).
    (b) When receiving any Freedom of Information Act request from the 
public, the contracting officer shall immediately refer the request to 
the Freedom of Information Act Officer, NASA Information Center, or 
other responsible point of contact as set forth in installation 
procedures.

PART 1852--SOLICITATION PROVISIONS AND CONTRACT CLAUSES

Sec.


1852.222-71  [Removed]

    6. Section 1852.222-71 is removed.


1852.223-72  [Removed]

    8. Section 1852.223-72 is removed.


1852.223-73  [Amended]

    9. In section 1852.223-73, the citation ``1823.7004(e)'' is revised 
to read ``1823.7001'', and in Alternate I, the citation 
``1823.7004(f)'' is revised to read ``1823.7001''.
    10. Part 1871 is revised to read as follows:

 PART 1871--MIDRANGE PROCUREMENT PROCEDURES

1871.000  Scope of part.

Subpart 1871.1--General

1871.101  Purpose.
1871.102  Authority.
1871.103  Applicability.
1871.104  Definitions.
1871.105  Policy.

Subpart 1871.2--Planning and Requirements Process

1871.201  Use of buying team.
1871.202  Organizational responsibilities.
1871.202-1  Requiring organization.

[[Page 55759]]

1871.202-2  Procurement organization.
1871.202-3  Supporting organizations.
1871.202-4  Center management.
1871.203  Buying team responsibilities.
1871.204  Small business set-asides.

Subpart 1871.3--Publicizing of Solicitation

1871.301  Publicizing policy.
1871.302  Publicizing procedure.
1871.303  Special situations.

Subpart 1871.4--Request for Offer (RFO)

1871.400  General.
1871.401  Types of RFO's.
1871.401-1  Sealed offers.
1871.401-2  Two-step competitive procurement.
1871.401-3  Competitive negotiated procurement not using qualitative 
criteria.
1871.401-4  Competitive negotiation using qualitative criteria (Best 
Value Selection).
1871.401-5  Noncompetitive negotiations.
1871.401-6  Commercial items.
1871.402  Preparation of the RFO.
1871.403  Offer preparation period and limitations.
1871.404  Protection of offers.
1871.405  RFO by NAIS (applicable to procurements meeting the 
thresholds in 1871-302(a)).

Subpart 1871.5--Award

1871.501  Representations and certifications.
1871.502  Determination of responsible contractor.
1871.503  Negotiation documentation.
1871.504  Award documents.
1871.505  Notifications to unsuccessful offerors.
1871.506  Publication of award.
1871.507  Debriefing of unsuccessful offerors.

Subpart 1871.6--``Best Value Selection''

1871.601  General.
1871.602  Specifications for MidRange procurements.
1871.603  Establishment of evaluation criteria.
1871.604  Evaluation phases.
1871.604-1  Initial evaluation.
1871.604-2  Determination of ``Finalists''.
1871.604-3  Discussions with ``Finalists''.
1871.604-4  Selection of ``Best Value'' Offer.

    Authority: 42 U.S.C. 2473(c)(1).


1871.000  Scope of part.

    This part prescribes policies and procedures for the acquisition of 
supplies, including commercial items, and services.

Subpart 1871.1--General


1871.101  Purpose.

    The purpose of this part is to establish policies and procedures 
that implement the MidRange procurement process.


1871.102  Authority.

    The Office of Federal Procurement Policy has provided authority for 
NASA to conduct a pilot test of a new procurement process within the 
scope of this part.


1871.103  Applicability.

    (a) This part applies to all acquisitions, as described in 
1871.103(b), conducted at NASA installations except as provided in 
1871.401-4(a)(3).
    (b) This part applies to all contract actions the aggregate amount 
of which is greater than the simplified acquisition threshold (SAT) 
(FAR part 13) and not more than $2,000,000 in basic value (not more 
than $10,000,000 with options) and for commercial items (FAR part 12) 
not more than $25,000,000 including options. This part may be used for 
commercial item contracts above $25,000,000 at the installation's 
discretion.
    (c) For other than commercial items, if the Government estimate for 
the basic award amount or any option amount, if any, exceeds the limits 
of 1871.103(b), the procurement will be processed under FAR and NFS 
procurement procedures applicable to large procurements (see FAR parts 
14 and 15). When the estimate is within the range of 1871.103(b) and 
the procurement was started using these procedures but the offered 
prices/costs exceed the MidRange ceiling, the procurement may continue 
under MidRange procedures, provided that:
    (1) The price/cost can be determined to be fair and reasonable,
    (2) The successful offeror accepts incorporation of required FAR 
and NFS clauses applicable to large procurements, and
    (3) The procurement does not exceed $3,000,000 for the basic 
requirement or $15,000,000 for the total requirement.


1871.104  Definitions.

    The following terms are used throughout part 1871 as defined in 
this subpart.
    (a) NASA Acquisition Internet Service or NAIS means the Internet 
home page (URL: http://procurement.nasa.gov) through which users may 
access documents available in electronic format.
    (b) MidRange procurement procedure means a set of procedures within 
the authority of 1871.102 and the applicability of 1871.103.
    (c) Request for Offer (RFO) means the solicitation used to request 
offers for all authorized MidRange procurements.
    (d) Clarification and Discussion are used as defined in FAR 15.601.
    (e) Commercial item is used as defined in FAR 2.101.


1871.105  Policy.

    (a) Under MidRange procedures, cost or pricing data and 
certification thereof shall be in accordance with FAR 15.804.
    (b) Procurements conducted under part 1871, unless otherwise 
properly restricted under the provisions of FAR part 6, are considered 
to be full and open competition after exclusion of sources in 
accordance with FAR 6.203, Set-asides for small business concerns, or 
full and open competition in accordance with FAR part 6, subpart 6.1.
    (c) Options may be included in the acquisition provided they 
conform to 1871.103(b) or do not exceed $10,000,000 for the total 
requirement ($25,000,000 for commercial items), options included.
    (d) The appropriate part 1871 post-selection processes 
(negotiation, award, and publication of award) may be used to the 
extent applicable for Small Business Innovation Research (SBIR), broad 
agency announcements, unsolicited proposals, and Small Business 
Administration 8(a) procurement actions within the applicability of 
1871.103(b).
    (e) The NAIS will be used to the maximum extent practicable to 
disseminate advance procurement information and conduct part 1871 
procurements.
    (f) Use of locally generated forms is encouraged where their use 
will contribute to the efficiency and economy of the process. NASA 
Forms 1667, Request for Offer, and 1668, Contract, or computer 
generated versions of these forms may be used as the solicitation and 
contract cover sheets, respectively, except that the SF1442, 
Solicitation, Offer, and Award (Construction, Alteration, or Repair) 
shall be used for construction acquisitions and the SF1449, 
Solicitation/Contract/Order for Commercial Items, shall be used for 
commercial item acquisitions. Contractor generated forms or formats for 
solicitation response should be allowed whenever possible. There is no 
requirement for uniform formats (see FAR 15.406).

Subpart 1871.2--Planning and Requirements Process


1872.201  Use of buying team.

    MidRange procedures are based on the use of a buying team to 
conduct the procurement. The concept is to designate individuals who 
are competent in their respective functional areas, provide those 
individuals with the basic authority to conduct the procurement and 
hold them accountable

[[Page 55760]]

for the results. The buying team will normally consist of one technical 
member and one procurement member, but may be augmented with additional 
members as necessary, Personnel providing normal functional assistance 
to the team (e.g., legal, financial) will not be considered a part of 
the team unless so designated. To function properly, the team should be 
given the maximum decision authority in matters related to the 
procurement. When higher level management approvals remain essential, 
it will be incumbent upon the functional team member to obtain such 
approvals.


1871.202  Organizatonal responsibilities.


1871.202-1  Requiring organization.

    The requirements organization shall appoint, by name, the technical 
member of the buying team. This individual will normally be an end user 
or the one most familiar with the technical aspects of the requirement. 
The individual appointed, whatever the relationship with the procured 
item, is expected to totally fulfill the responsibilities to the buying 
team.


1871.202-2  Procurement organization.

    The procurement organization shall appoint the procurement member 
of the buying team. This individual shall be a warranted contracting 
officer or a contract specialist with broad latitude to act for the 
contracting officer. The procurement member shall be the team leader 
with the ultimate responsibility to conduct the procurement.


1871.202-3  Supporting organizations.

    Buying team members may require additional team members to perform 
specialized functions or to assist in the evaluation of offers. 
Requests for supporting members shall be made by the organization 
identifying the need for the support and directed to the appropriate 
management level in the supporting organization. Supporting team 
members, once designated for the team, shall fulfill all applicable 
responsibilities to the team as other members.


1871.202-4  Center management.

    Center managers shall, to the maximum extent practical and 
consistent with their responsibilities to manage the Center mission, 
convey sufficient authority to members of the buying team to conduct 
the procurement. Administrative or technical approvals should be 
minimized, and where deemed essential, facilitated to the maximum 
extent practicable. Center managers should lend their full support to 
the buying team should problems arise from the procurement.


1871.203  Buying team responsibilities.

    (a) The buying team shall conduct the procurement in a manner that 
best satisfies the user requirements and meets the norms expected of a 
Government procurement. Team members should develop open 
communications, rely on decisions of other responsible functional team 
members and meet their obligations to the team. The team will 
typically--
    (1) Refine the final specifications for the solicitation;
    (2) Decide the most appropriate solicitation method;
    (3) Establish milestones for the procurement;
    (4) Finalize the evaluation criteria;
    (5) Develop the RFO and model contract; and
    (6) Evaluate offers and determine the awardee.
    (b) The procurement member of the buying team shall lead 
clarifications, discussions, and negotiations; shall be the source 
selection official; and shall conduct debriefings.


1871.204  Small business set-asides.

    (a) Except as provided in paragraphs (b) through (e) of this 
section, each MidRange acquisition shall be reserved exclusively for 
small business concerns.
    (b) The requirment for small business MidRange set-asides does not 
relieve the buying office of its responsibility to procure from 
required sources of supply, such as Federal Prison Industries, 
Industries for the Blind and Other Severely handicapped, and multiple 
award Federal Supply Schedule contracts.
    (c) Procurements not conducted as small business set-asides and 
under less than full and open competition require a Justification for 
Other than Full and Open Competition pursuant to FAR part 6.
    (d) If the buying team procurement member determines there is no 
reasonable expectation of obtaining offers from two or more responsible 
small business concerns that will be competitive in terms of market 
price, quality, and delivery, the buying team need not proceed with the 
small business set-aside and may purchase on an unrestricted basis 
utilizing MidRange procedures. The buying team procurement member shall 
document the contract file with the reason for the unrestricted 
procurement.
    (e) If the buying team proceeds with the small business MidRange 
set-aside and receives an offer from only one responsible small 
business concern at a reasonable price, the contracting officer will 
normally make an award to that concern. However, if the buying team 
does not receive a reasonable offer from a responsible small business 
concern, the buying team procurement member may cancel the small 
business set-aside and complete the procurement on an unrestricted 
basis utilizing MidRange procedures. The buying team procurement 
members shall document in the file the reason for the unrestricted 
purchase.
    (f) Each model contract under a small business MidRange set-aside 
shall contain the clause at FAR 52.219-6, Notice of Total Small 
Business Set-Aside.

Subpart 1871.3--Publicizing of Solicitation


1871.301   Publicizing policy.

    (a) Use of the MidRange procedure is intended to streamline and 
expedite the acquisition process. Publication requirements for synopses 
are streamlined; however, it is in the Government's interest to provide 
as much advance notice as possible of a pending acquisition in order 
for the Government to obtain maximum competition.
    (b) The dollar thresholds stated in 1871.302 are lower than the 
MidRange thresholds in 1871.103. They are based on Section 5062 of the 
Federal Acquisition Streamlining Act.


1871.302   Publicizing procedure.

    (a) Synopses are not to be sent to or published in the Commerce 
Business Daily except if the basic award is expected to exceed 
$500,000, the total amount of the basic award plus options is expected 
to exceed $2,500,000, or annual obligations are expected to exceed 
$500,000 in any one year. For those acquisitions published both in the 
CBD and on the NAIS, the CBD publication date is the basis upon which 
the time frames specified in FAR 5.203 are calculated.
    (b) A synopsis for each requirement shall be published on the NAIS 
prior to or simultaneously with the actual release of the solicitation.
    (c) The synopsis shall comply with the requirements set forth in 
FAR 5.207(b) and shall:
    (1) Include a statement that the competitive solicitation will be 
released via the NAIS, that potential offerors will be responsible for 
downloading their own copy of the solicitation, and that hard copies of 
the solicitation will not be mailed, and
    (2) State the projected solicitation release date if the synopsis 
is published

[[Page 55761]]

prior to solicitation release, provide notice that it is the offeror's 
responsibility to monitor the NAIS for solicitation release as the 
solicitation will be released as soon as practicable whether prior or 
subsequent to the projected date, and identify the name, telephone 
number, fax number, and e-mail address of a point of contact. The 
synopsis shall be updated to reflect significant changes to the 
original notice.
    (d) For commercial item purchases, the streamlined solicitation 
(combined presolicitation notice and solicitation described in FAR part 
12) may be used.


1871.303   Special situations.

    Notices for special situations as described in FAR 5.205 involving 
MidRange Procurements must be published in the Commerce Business Daily. 
Such special situations include R&D sources sought, intent to sponsor 
or change the mission of a Federally Funded Research and Development 
Center, effort to locate commercial sources under OMB Circular No. A-
76, and Section 8(a) competitive national buy acquisitions.

Subpart 1871.4--Request for Offer (RFO)


1871.400  General.

    In MidRange procedures, solicitation of sources shall be 
accomplished by use of an RFO. The RFO will be solely a solicitation 
document incorporating only those elements of information required to 
solicit the offer. Offers will be provided on a model contract 
furnished with the RFO.


1871.401  Types of RFO'S.

    The RFO may be used for all types of procurements to which MidRange 
is applicable. The distinguishing difference will be the evaluation and 
award criteria specified in the RFO. This, in turn, will be driven by 
the buying team's decisions on the extent of discussion required, the 
amount of non-price factors that will influence the award and the 
amount of competition available. If the conditions in FAR 6.401(a) are 
met, the RFO's described in 1871.401-1 and 1871.401-2 shall be used; 
otherwise, RFO's described in 1871.401-3, 1871.401-4, 1871.401-5, or 
1871.401-6 may be used. Once the evaluation and award criteria have 
been specified in the RFO, the procurement must conform to the 
procedures applicable to these criteria, unless changed by formal 
amendment to the RFO.


1871.401-1  Sealed offers.

    (a) Policy. RFO's may specify that award will be made to the low, 
responsive, responsible offeror providing the most advantageous offer 
considering only price and price-related factors. This method shall be 
used when (1) time permits the solicitation, submission, and evaluation 
of sealed offers; (2) award will be made on the basis of price and 
other price-related factors; (3) conducting discussions with the 
offerors is not necessary; and (4) a reasonable expectation of 
receiving more than one offer exists. The RFO shall be in compliance 
with the requirements of FAR part 14 relating to Sealed Bidding.
    (b) Procedures. (1) The RFO shall request offerors to provide a 
complete offer by the closing date specified.
    (2) In accordance with FAR part 14, offers (whether received by 
facsimile or sealed envelope delivery) shall be publicly opened at the 
designated time and place. Interested members of the public will be 
permitted to attend the opening. Offers shall be abstracted pursuant to 
FAR part 14 and be available for public inspection. The abstract shall 
be included in the contract file.
    (3) All offers shall be examined for mistakes in accordance with 
FAR 14.406. The buying team shall determine that a prospective 
contractor is responsible and that the prices offered are reasonable 
(see FAR 14.407-2).
    (4) The Government will award a contract to the low, responsive, 
responsible offeror, whose offer conforms to the RFO and will be most 
advantageous to the Government, considering only price and the price-
related factors included in the solicitation.


1871.401-2  Two-step competitive procurement.

    (a) Policy. (1) RFO's may specify that evaluation and award may be 
conducted in two distinct steps, similar in concept to ``Two Step 
Sealed Bidding.'' The MidRange Two Step process should be used when it 
is desirable to award to the lowest, responsive, responsible offeror 
after determining that the initial technical offer, or the revised 
technical offer, is acceptable.
    (2) The procedures of FAR 14.503-2(a) shall be used once Step Two 
of this process begins.
    (b) Procedures. (1) The RFO shall request offerors to provide both 
a technical and a price offer by the closing date specified. Price 
offers are requested to ensure that they are accomplished in a timely 
manner and to reduce the time required for Step Two.
    (2) Step One. The technical offer will be evaluated to determine if 
the product or service offered is acceptable. The buying team may 
proceed directly to Step Two if there are sufficient acceptable offers 
to ensure adequate price competition, and if further time, effort and 
delay to make additional offers acceptable and thereby increase 
competition would not be in the Government's interest. If this is not 
the case, the buying team procurement member shall enter into 
discussions and request offeror(s) whose offer(s) is susceptible to 
being made acceptable to submit additional clarifying or supplementing 
information to make it acceptable (see FAR 14.503-1). It is expected 
that these discussions will be conducted on an informal basis. After 
completion of discussions, the buying team shall proceed to Step Two.
    (3) Step Two. If discussions were held, the buying team shall 
afford all offerors who have submitted acceptable offers and those 
offers with whom discussions were conducted, an opportunity, by a 
common date, to revise their price offers. No changes to technical 
offers will be permitted during this process. A reasonable amount of 
time (normally less than 5 working days) will be afforded for the 
revision. The amount of time given shall be the same for each offeror. 
The procedures at 1871.401-1(b) (2) and (3) shall then be followed.
    (4) The Government will award a contract to the low, responsive, 
responsible offeror, whose offer conforms to the RFO and will be most 
advantageous to the Government, considering only price and the price-
related factors included in the solicitation.


1871.401-3  Competitive negotiated procurement not using qualitative 
criteria.

    (a) Policy. (1) RFO's may provide for discussion of all aspects of 
the offer but award is based on the technically acceptable offer having 
the lowest price (if fixed price) or the lowest most probable cost (if 
cost reimbursable). This method should be used when qualitative factors 
are not material in the award decision, but it is important to assure 
that technical offers and contract terms are fully compliant with the 
Government's needs. This method also permits direct discussion of price 
with offerors and is particularly appropriate when different approaches 
can be offered to satisfy the Government's need.
    (2) The RFO should reserve the right to award without discussion 
based on the initial offers submitted. FAR 52.215-16, Alternate II, 
will be included

[[Page 55762]]

in all RFO's for competitive negotiated procurements not using 
qualitative criteria except for solicitations for commercial item 
acquisitions.
    (b) Procedures. (1) The RFO shall request offerors to provide both 
a technical and a price offer by the closing date specified.
    (2) Initial evaluation. The buying team shall review each offer to 
determine if all required information has been provided. No further 
evaluation shall be made of any offer that is deemed unacceptable 
because it does not meet the technical requirements of the RFO and is 
not reasonably susceptible to being made so. Offerors may be contacted 
for clarification purposes only during the initial evaluation. Offerors 
determined not to be acceptable shall be notified of their rejection 
and the reasons therefore and excluded from further consideration. 
Documentation for such rejection should consist of one or more succinct 
statements of fact that show the offer is not acceptable. No 
documentation is required if all offers are deemed to be acceptable or 
reasonably susceptible to being made so.
    (3) Determination of finalists. From among the acceptable offers 
and those susceptible to being made acceptable, the buying team shall 
rank the offers based on price (or most probable cost) and exclude any 
whose price/most probable cost precludes any reasonable chance of being 
selected for final award. The remaining offers constitute the 
``finalists'' for the contract. Only in exceptional cases will this 
number be less than two offers. The procurement buying team member 
shall succinctly record the basis for the decision.
    (4) Discussions. The procurement buying team member shall lead 
discussions with each finalist. The discussions are intended to assist 
the buying team in fully understanding each finalist's offer and to 
assure that all finalists are competing equally on the basis intended. 
Care must be exercised to ensure these discussions adhere, to the 
extent applicable, to the guidelines set forth in FAR 15.610. It is 
expected that discussions will be conducted on an informal basis with 
each finalist. After completion of discussions, each finalist shall be 
afforded an opportunity to revise its offer to support and clarify its 
offer. A reasonable amount of time (Normally less than 5 working days) 
will be afforded for the revision. The amount of time given shall be 
the same for each finalist. Such discussions are not required if there 
are sufficient acceptable offers to ensure adequate price competition, 
and if further time, effort and delay to make additional proposals 
acceptable and thereby increase competition, would not be in the 
Government's interest.
    (5) Selection. The procurement team member shall be the source 
selection official. The source selection official may elect to make 
selection in lieu of determining finalists provided that it can be 
demonstrated that (i) selection of an initial offer(s) will result in 
the lowest price/cost to the Government and (ii) discussions with other 
acceptable offerors are not anticipated to change the outcome of the 
initial evaluation relative to evaluated price/cost. It is expected 
that the source selection statement will not ordinarily exceed one page 
and that the basis for the decision will be apparent upon review of the 
informal worksheets used in the evaluation process. These informal 
worksheets shall be included in the contract file.
    (6) The names of offerors determined to be finalists or the name of 
the offeror selected for contract award will be electronically 
transmitted to all offerors. This will serve as notification to those 
offers that were not selected for further evaluation (see 1871.505).


1871.401-4   Competitive negotiations using qualitative criteria (Best 
Value Selection).

    (a) Policy. (1) MidRange procurements shall normally use the BVS 
source selection method, prescribed in part 1871, subpart 1871.6, when 
it is desirable to base evaluation and award on a combination of price 
and non-price qualitative criteria.
    (2) The RFO should reserve the right to award without discussion 
based on the initial offers submitted. FAR 52.215-16, Alternate II, 
will be included in all RFO's for competitive negotiated procurements 
using qualitative criteria except for solicitations for commercial item 
acquisitions.
    (3) In exceptionally complex procurements, a source selection 
method other than MidRange Best Value Selection may be more 
appropriate. This may be appropriate in cases in which the following 
factors cannot be accommodated within the MidRange/BVS selection 
methodology:
    (i) The ability to predefine the value characteristics that will 
constitute the discriminators among the offers;
    (ii) The complexity of the interrelationships that must be 
evaluated;
    (iii) The number of evaluators required to address the disciplines 
that will be involved in the offers; or
    (iv) The impact that the procurement may have on higher level 
mission management (level of selection official) or future 
procurements.
    (b) Procedures. (1) The buying team will determine which of the 
source selection methodologies is most appropriate to the specific 
procurement.
    (2) The team shall record its rationale for selecting a methodology 
rather than BVS. Once this decision is made, the team shall no longer 
function as a MidRange buying team, but shall follow the instructions 
prescribed in the local procedures for the source selection method.


1871.401-5  Noncompetitive negotiations.

    (a) Policy. (1) The RFO may be used as the solicitation method for 
noncompetitive procurements.
    (2) MidRange procedures may be used in noncompetitive acquisitions 
to the extent they are applicable.
    (b) Procedures. (1) Within the dollar thresholds specified in 
1871.302(a), posting a synopsis on the NAIS meets the requirement of 
FAR 5.201 and complies with the notice required by the Competition in 
Contracting Act. A synopsis is not required if one of the exceptions of 
FAR 5.202 is met.
    (2) The buying team shall require submission of certified cost and 
pricing data in accordance with FAR 15.804-2.
    (3) The technical member of the buying team shall provide technical 
assistance to the procurement member during evaluation and negotiation 
of the contractor's offer.


1871.401-6  Commercial items.

    (a) Policy. (1) MidRange procedures are considered consistent with 
the requirements of FAR part 12, Acquisition of Commercial Items. In 
the event of a conflict, however, FAR part 12 takes precedence.
    (2) MidRange Procedures shall be used for commercial item 
procurements except that type of contract is limited by FAR 12.207.
    (b) Procedures. The offices will be evaluated in accordance with 
applicable procedures, and shall include consideration of technical, 
past performance, and price.


1871.402  Preparation of the RFO.

    (a) The RFO shall provide all standard information required for the 
offeror to submit an offer.
    (b) The RFO shall contain space for all necessary additional 
instructions to offerors. As a minimum, the RFO shall contain the 
following:
    (1) Incorporation by reference of all required standard provisions.
    (2) A provision notifying offerors that standard Representations 
and Certifications will be required.

[[Page 55763]]

    (3) Evaluation and award criteria.
    (4) A provision requiring offerors to submit offers on an attached 
model contract.
    (c) Requirements for the content and format of the offer should be 
the minimum required to provide for proper evaluation. Offerors' 
formats should be allowed to the maximum extent possible.
    (d) Facsimile offers, defined by FAR 14.202-7 and 15.402(i), are 
authorized for MidRange procurements.


1871.403  Offer preparation period and limitations.

    For procurements which are synopsized solely on the NAIS, the 
buying team should establish deadlines for receipt of offers based on 
an assessment of the minimum amount of time required to respond to the 
solicitation. The time required will depend on the complexity of the 
requirement and amount of cost and technical information required to be 
submitted. The information required shall be limited to the amount 
required to conduct a proper evaluation. The offer preparation period 
established in the RFO shall not be less than 15 calendar days unless 
the procurement in urgent. For procurements which are synopsized on the 
NAIS and published in the CBD, FAR requirements for waiting times and 
deadlines for the receipt of offers apply.


1870.404  Protection of offers.

    A facsimile machine(s) shall be dedicated for receipt of offers and 
placed in a secure location where offers received on it can be 
safeguarded. All offers submitted shall be recorded, sealed in an 
envelope marked with the RFO number and taken to the buying team 
procurement member. Facsimile attendants shall make a good faith effort 
to inspect the document for completeness and legibility. If the 
attendant believes there are missing or illegible pages, the document 
will be promptly referred to the buying team procurement member for 
notification to the offeror that it should resubmit the offer. The 
Government shall not assume responsibility for proper transmission.


1871.405  RFO by NAIS (applicable to procurement meeting the thresholds 
in 1871.302(a)).

    (a) Competitive solicitations for MidRange Procurements shall be 
made available on the NAIS. Solicitations available on the NAIS are 
exempt from the requirement in FAR 14.203-1 that delivery of the 
solicitations be made pursuant to FAR 14.205.
    (b) For the purposes of FAR 15.402(a), a solicitation posted on the 
NAIS is a written solicitation.
    (c) Solicitations posted on the NAIS in accordance with the 
regulations in this part are exempt from the requirement in FAR 
15.408(a) to issue solicitations using the procedures in FAR part 5.

Subpart 1871.5--Award


1871.501  Representations and certifications.

    Upon determination of the successful offeror, the buying team 
procurement member will determine if the offeror has on file valid 
Representations and Certifications. If the offeror has not completed 
the required forms, or they have expired, the offeror will be requested 
to provide the forms promptly. Should the offeror refuse to provide the 
required Representations and Certifications or fail to meet a required 
condition, the buying team shall reject the offer and proceed to the 
next highest ranked offeror who is responsive and responsible.


1871.502  Determination of responsible contractor.

    Contractor responsibility shall be determined in accordance with 
FAR part 9.


1871.503  Negotiation documentation.

    The prenegotiation memorandum, if required, and the results of 
negotiation will be in abbreviated form and will be approved by the 
buying team.


1871.504  Award documents.

    Contract award shall be accomplished by contracting officer 
execution of the contract document and providing a paper copy to the 
successful offeror. If facsimile documents were used in the evaluation 
process, the successful offeror may be required to execute original 
copies of the contract to facilitate legibility during the 
administration phase of the contract.


1871.505  Notifications to unsuccessful offerors.

    For solicitations that were posted on the NAIS, a preaward notice 
shall be electronically transmitted to the offerors. This notice meets 
the requirements of FAR 15.1001. However, the preaward notice in a 
small business set-aside must allow unsuccessful offerors 5 working 
days to challenge the small business status of the successful offeror.


1871.506  Publication of award.

    An award notice shall be posted on the NAIS for 7 calendar days 
after posting, if the contract offers subcontracting opportunities or 
if it is subject to the Trade Agreements Act. The information required 
by FAR 5.207 shall be included in the award notice in abbreviated form.


1871.507  Debreifing of unsuccessful offerors.

    The procurement buying team member shall conduct debriefings if 
requested.

Subpart 1871.6--``Best Value Selection''


1871.601  General.

    (a) Best Value Selection (BVS) seeks to select an offer based on 
the best combination of price and qualitative merit of the offers 
submitted and reduce the administrative burden on the offerors and the 
Government.
    (b) BVS takes advantage of the lower complexity of MidRange 
procurements and predefines the value characteristics which will serve 
as the discriminators among offers. It eliminates the use of area 
evaluation factors and the highly structured scoring.


1871.602  Specifications for MidRange procurements.

    BVS refines the traditional approach to preparing specifications. 
BVS envisions that the requirement will focus on the end result that is 
to be achieved and will serve as a statement of the Government's 
baseline requirements. The offeror will be guided in meeting the 
Government's needs by a separate set of value characteristics which 
establish what the Government considers to be valuable in an offer. 
These value characteristics will be performance based and will permit 
the selection of the offer which provides better results for a 
reasonable marginal increase in price.


1871.603  Establishment of evaluation criteria.

    (a) The requiring organization will provide, along with the 
requirement, a list of value characteristics against which the offers 
will be judged. There is no limit to the number or the type of 
characteristics that may be specified. The only standard will be 
whether the characteristic is rationally related to the need specified 
in the specification. Characteristics may include such factors as 
improved reliability, innovativeness of ideas, speed of service, 
demonstrated delivery performance, higher speeds, ease of use, 
qualifications of personnel, solutions to operating problems, level of 
service provided on previous similar contracts, or any of numerous 
other

[[Page 55764]]

characteristics that may be of value to the Government in satisfying 
its needs.
    (b) Cost and technical will be considered equal in importance. The 
value characteristics will not be assigned weights.
    (c) All subsequent evaluations will consider these characteristics 
when determining the finalists or making the final selection for award.


1871.604  Evaluation phases.


1871.604-1  Initial evaluation.

    (a) Offers will be reviewed to determine if all required 
information has been provided and the offeror has made a reasonable 
attempt to present an acceptable offer. Offerors may be contacted only 
for clarification purposes during the initial evaluation. No further 
evaluation shall be made of any offer that is deemed unacceptable 
because:
    (1) It does not represent a reasonable effort to address itself to 
the essential requirements of the RFO or clearly demonstrates that the 
offeror does not understand the requirements of the RFO;
    (2) It contains major technical or business deficiencies or 
omissions or out-of-line costs which discussions with the offeror could 
not reasonably be expected to cure; or
    (3) In R&D procurement, a substantial design drawback is evident in 
the offer and sufficient correction or improvement to consider the 
offer acceptable would require virtually an entirely new offer.
    (b) Offerors determined not to be acceptable shall be notified of 
their rejection and the reasons therefor and excluded from further 
consideration.
    (c) Documentation. If it is concluded that all offers are 
acceptable, then no documentation is required and evaluation proceeds. 
If one or more offers are not acceptable, the procurement member of the 
team will notify the offeror of the rejection and the reasons therefor. 
The documentation should consist of one or more succinct statements of 
fact that show the offer is not acceptable.


1871.604-2  Determination of ``Finalists''.

    (a) All acceptable offers will be evaluated against the requirement 
and the value characteristics. Based on this evaluation, the team will 
identify the finalists from among the offers submitted. Finalists will 
include all offers having a reasonable chance of being selected for 
award, as prescribed in FAR 15.609 for competitive range. Generally, 
finalists will include the offer having the best price (or lowest most 
probable cost) and the offer having the highest qualitative merit, plus 
those determined to have the best combination of price and merit. 
Offers not qualifying as finalists will be excluded from the balance of 
the evaluation process.
    (b) The selection official may elect to make selection in lieu of 
determining finalists, provided it can be clearly demonstrated that
    (1) Selection of an initial offer(s) will result in the best value 
for the Government, considering both price and non-price qualitative 
criteria;
    (2) Discussions with other acceptable offerors are not anticipated 
to change the outcome of the initial evaluation relative to the best 
value offer(s), and
    (3) The solicitation contains a provision permitting award without 
discussions.
    (c) Documentation. If finalists are identified as discussed in 
paragraph (a) of this section, the documentation expected and required 
to result from this phase of evaluation is approximately one-quarter of 
a page for each finalist. The documentation shall succinctly describe 
how the value characteristics in the RFO were provided by the offeror 
and cost/price considerations that caused the offer to qualify as a 
finalist. The evaluator(s) shall not be required to justify why other 
offers provided less qualitative merit. It is expected that, should the 
decision be challenged, the documented reason for selection, when 
compared with the non-selected offer, shall clearly demonstrate the 
difference that resulted in non-selection. It is expected and 
recommended that all informal worksheets used in the evaluation process 
be included in the contract file. When selection of the successful 
offeror(s) is made, the buying team shall document the selection in 
accordance with 1871.604-4(c).
    (d) The names of offerors determined to be finalists or selected 
for contract award will be electronically transmitted to all offerors. 
This will serve as notification to those offerors that were not 
selected for further evaluation (see 1871.505).


1871.604-3  Discussions with ``Finalists''.

    (a) The procurement team member shall lead discussions with each 
finalist. Care must be exercised to ensure these discussions adhere, to 
the extent applicable, to the guidelines set forth in FAR 15.610. It is 
expected that these discussions will be conducted on an informal basis 
with each finalist.
    (b) After completion of discussions, each finalist shall be 
afforded an opportunity to revise its offer. A reasonable amount of 
time (normally less than 5 working days) will be afforded for the 
revision. The amount of time given shall be the same for each finalist.


1871.604-4  Selection of ``Best Value'' Offer.

    (a) The procurement team member shall be the source selection 
official.
    (b) The BVS source selection is based on the premise that, if all 
offers are of approximately equal qualitative merit, award will be made 
to the offer with the lowest evaluated price (fixed-price contracts) or 
the lowest most probable cost (cost type contracts). However, the 
Government will consider awarding to an offeror with higher qualitative 
merit if the difference in price is commensurate with added value. 
Conversely, the Government will consider making award to an offeror 
whose offer has lower qualitative merit if the price (or cost) 
differential between it and other offers warrant doing so.
    (c) Documentation. Rationale for selection of the successful 
offeror shall be recorded in a selection statement which succinctly 
records the value characteristics upon which selection was made. The 
statement need not and should not reveal details of the successful 
offer that are proprietary or business sensitive. Since the value 
characteristics are expressed in performance terms, the reasons for 
selection can focus on results to be achieved, rather than the detailed 
approach the offeror will use. The statement shall also comment on the 
rationale used to equate cost and qualitative merit. Little or no 
additional analysis is required when the selected offeror possessed the 
highest merit and lowest price. When a marginal analysis is made 
between value characteristics and price (or cost)--in most cases this 
will be a subjective, integrated assessment of all pertinent factors--
specific rationale should be provided to the extent possible. It is 
expected that the statement will not ordinarily exceed one page. Where 
the procurement is closely contested, it would be prudent to expand on 
the rationale provided in the statement.
    (d) The name of the offeror(s) selected for award shall be 
electronically transmitted to the offerors which will serve as a 
notification to those offerors that were not selected (see 1871.505). 
The selection statement may be made available at the buying team's 
discretion.

[FR Doc. 96-26337 Filed 10-28-96; 8:45 am]
BILLING CODE 7510-01-M