[Federal Register Volume 63, Number 155 (Wednesday, August 12, 1998)]
[Proposed Rules]
[Pages 43238-43239]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-21443]


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DEPARTMENT OF DEFENSE

GENERAL SERVICES ADMINISTRATION


NATIONAL AERONAUTICS AND SPACE ADMINISTRATION

48 CFR Part 31

[FAR Case 98-001]
RIN 9000-AI06

Federal Acquisition Regulation; Recruitment Costs Principle

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

ACTION: Proposed rule with request for comments.

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SUMMARY: The Civilian Agency Acquisition Council and the Defense 
Acquisition Regulations Council are proposing to amend the Federal 
Acquisition Regulation (FAR) to revise the ``recruitment costs'' and 
the ``public relations and advertising costs'' cost principles for 
streamlining purposes. This regulatory action was not subject to Office 
of Management and Budget review under Executive Order 12866, dated 
September 30, 1993. This is not a major rule under 5 U.S.C. 804.

DATES: Comments should be submitted on or before October 13, 1998 to be 
considered in the formulation of a final rule.

ADDRESSES: Interested parties should submit written comments to: 
General Services Administration, FAR Secretariat (MVR), Attn: Laurie 
Duarte, 1800 F Street, NW, Room 4035, Washington, DC 20405.
    E-mail comments submitted over Internet should be addressed to: 
[email protected].
    Please cite FAR case 98-001 in all correspondence related to this 
case.

FOR FURTHER INFORMATION CONTACT: The FAR Secretariat, Room 4035, 1800 F 
Street, NW, Washington, DC 20405, (202) 501-4755, for information 
pertaining to status or publication schedules. For clarification of 
content, contact Ms. Linda Nelson, Procurement Analyst, at (202) 501-
1900. Please cite FAR case 98-001.

SUPPLEMENTARY INFORMATION:

A. Background

    The proposed rule amends FAR 31.205-1, Public relations and 
advertising costs, and FAR 31.205-34, Recruitment costs, to remove 
excessive wording and details for streamlining purposes. FAR 31.205-
1(d) was revised to indicate that the allowability of recruitment 
expenses in connection with advertising costs is addressed at FAR 
31.205-34. Certain restrictive language at FAR 31.205-34 was removed 
since the normal standards at FAR 31.201-3, Determining reasonableness, 
and FAR 31.201-4, Determining allocability, applies to these types of 
expenses. In addition, FAR 31.205-34(c) has been deleted since 
excessive compensation is already adequately addressed at FAR 31.205-6, 
Compensation for personal services.

B. Regulatory Flexibility Act

    This 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 most 
contracts awarded to small entities use simplified acquisition 
procedures or are awarded on a competitive, fixed-price basis, and do 
not require application of the cost principles contained in this rule. 
An Initial Regulatory Flexibility Analysis has, therefore, not been 
performed. Comments are invited from small businesses and other 
interested parties. Comments from small entities concerning the 
affected FAR subpart also will be considered in accordance with 5 
U.S.C. 610 of the Act. Such comments must be submitted separately and 
should cite 5 U.S.C. 601, et seq. (FAR case 98-001), in correspondence.

C. Paperwork Reduction Act

    The Paperwork Reduction Act does not apply because the proposed 
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 31

    Government procurement.

    Dated: August 5, 1998.
Edward C. Loeb,
Director, Federal Acquisition Policy Division.

    Therefore, it is proposed that 48 CFR Part 31 be amended as set 
forth below:

[[Page 43239]]

PART 31--CONTRACT COST PRINCIPLES AND PROCEDURES

    1. The authority citation for 48 CFR Part 31 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 31.205-1 is amended by revising paragraph (d) to read as 
follows:


31.205-1  Public relations and advertising costs.

* * * * *
    (d) The only allowable advertising costs are those that are--
    (1) Specifically required by contract, or that arise from 
requirements of Government contracts, and that are exclusively for--
    (i) Acquiring scarce items for contract performance; or
    (ii) Disposing of scrap or surplus materials acquired for contract 
performance;
    (2) Costs of activities to promote sales of products normally sold 
to the U.S. Government, including trade shows, which contain a 
significant effort to promote exports from the United States. Such 
costs are allowable, notwithstanding paragraphs (f)(1), (f)(3), 
(f)(4)(ii), and (f)(5) of this subsection. However, such costs do not 
include the costs of memorabilia (e.g., models, gifts, and souvenirs), 
alcoholic beverages, entertainment, and physical facilities that are 
used primarily for entertainment rather than product promotion; or
    (3) Allowable in accordance with 31.205-34.
* * * * *
    3. Section 31.205-34 is amended in the introductory text of 
paragraph (a) by removing ``paragraphs (b) and (c) below,'' and adding 
``paragraph (b) of this subsection,'' in its place; revising paragraph 
(b); and removing paragraph (c) to read as follows:


31.205-34  Recruitment costs.

* * * * *
    (b) Help-wanted advertising costs are unallowable if the 
advertising--
    (1) Does not describe specific positions or classes of positions; 
or
    (2) Includes material that is not relevant for recruitment 
purposes, such as extensive illustrations or descriptions of the 
company's products or capabilities.

[FR Doc. 98-21443 Filed 8-11-98; 8:45 am]
BILLING CODE 6820-EP-P