[Federal Register Volume 63, Number 229 (Monday, November 30, 1998)]
[Proposed Rules]
[Pages 65728-65744]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-31430]


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DEPARTMENT OF STATE

48 CFR Parts 601, 602, 603, 604, 605, 606, 608, 609, 610, 611, 613, 
614, 615, 616, 617, 619, 622, 623, 625, 626, 628, 629, 630, 631, 
632, 633, 634, 636, 637, 639, 641, 642, 643, 644, 645, 646, 647, 
649, 652, 653

[Public Notice No. 2925]
RIN 1400-AA71


Department of State Acquisition Regulation (DOSAR)

AGENCY: Office of the Procurement Executive, Department of State.

ACTION: Proposed rule.

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SUMMARY: This proposed rule is being issued for comment in accordance 
with Section 4301 of the Federal Acquisition Reform Act of 1996 (Pub. 
L. 104-106). Section 4301 requires the elimination of certification 
requirements from the Department of State Acquisition Regulation 
(DOSAR) that are not specifically imposed by statute. In addition, this 
proposed rule adds one new certification required by statute and one 
new certification not required by statute but justified in accordance 
with section 29 of Public Law 104-106. This proposed rule also 
eliminates internal coverage from the codified section of the DOSAR. 
Finally, the proposed rule contains miscellaneous amendments and 
corrections needed to bring the DOSAR in line with recent changes in 
the Federal Acquisition Regulation.

DATES: Public comments must be received by January 29, 1999.

ADDRESSES: Comments may be sent to: Gladys Gines, Procurement Analyst, 
Department of State, Office of the Procurement Executive, 2201 C Street 
NW, Suite 603, State Annex Number 6, Washington, DC 20522-0602; e-mail 
address: [email protected].

FOR FURTHER INFORMATION CONTACT: Gladys Gines, telephone (703) 516-1691 
or at the e-mail address specified above.

SUPPLEMENTARY INFORMATION:

I. Background

    In accordance with Section 4301 of the Federal Acquisition Reform 
Act of 1996, the Department of State proposes to remove several 
certifications from the DOSAR. They are: 652.203-71, Certification 
Regarding Federal Employment (requirement not based in statute); 
652.223-70, Estimates of the Total Percentage of Recovered Materials to 
be Utilized in the Performance of the Contract (superseded by FAR 
52.223-9); and, 652.223-71, Certification of Minimum Content Actually 
Utilized in the Performance of the Contract (also superseded by FAR 
52.223-9).
    In conjunction with the review of the DOSAR to eliminate any 
certifications not based in statute, the Department looked at all 
current DOSAR provisions and clauses to determine if they could be 
eliminated or revised. In addition, the Department proposes to add 
several new certifications and clauses. Accordingly, the Department 
proposes to take the following actions:
     Eliminate the clause at 652.203-70, Prohibition Against 
the Use of Federal Employees.
     Eliminate the clauses at 652.204-70, Security 
Requirements, and 652.204-71, Security Requirements--Personnel. Both of 
these clauses implement requirements for contractors that have access 
to classified information. However, the Department falls under the 
National Industrial Security Program (NISP), which establishes a 
program to safeguard Federal Government classified information that is 
released to contractors. FAR 4.404 prescribes clauses for use by 
agencies covered by the NISP. The Department has determined that the 
FAR coverage is adequate and the DOSAR language is no longer required. 
The associated DOSAR prescription at 604.404-70 is also removed.
     Revise the provision at 652.206-70, Competition Advocacy/
Ombudsman, to better explain the role of the Acquisition Ombudsman.
     Renumber the clause at 652.214-70, Notices, to 652.243-70. 
The associated prescription at 614.201-7-70(b) is also removed, and a 
new prescription is found at 643.104-70. The change was made because 
the clause deals with contract modifications, and is applicable to all 
contracts, not just those awarded using sealed bidding.
     Revise the provision at 652.214-71, Authorization to 
Perform, to clarify that (1) the requirement to obtain licenses, 
permits, etc. is in accordance with the date specified in the 
solicitation, (e.g., the date may be after contract award); and (2) the 
requirement to obtain the licenses, permits, etc. applies only to the 
parties who will actually be performing the work, i.e., prime 
contractor, subcontractors or joint venture partner.
     Revise the clause at 652.216-71, Price Adjustment, for 
clarification purposes.
     Add a new clause at 652.219-71, Section 8(a) Direct 
Awards, to implement the Memorandum of Understanding between the 
Department and the Small Business Administration to allow for direct 
awards to contractors under the 8(a) Program. Subpart 619.8 is also 
revised accordingly.
     Eliminate the provisions and clauses at 652.223-72, Use of 
Double-Sided Copying in the Submission of Bids and Proposals; 652.223-
73, Use of Double-Sided Copying in the Submission of Reports; 652.223-
74, Use of Fly Ash as a Partial Replacement for Cement and Concrete; 
652.223-75, Use of Recovered Materials in Building Insulation Products; 
652.223-76, Use of Lubricating Oils Containing Re-Refined Oils; 
652.223-77, Use of Retread Tires; and, 652.223-78, Use of Recovered 
Materials in Paper and Paper Products. These provisions and clauses 
have been superseded by FAR language incorporated in FACs 90-27 and 97-
1. DOSAR Subpart 623.4 is revised in its entirety to conform to the new 
FAR requirements.
     Add a new certification at 652.225-70, Arab League Boycott 
of Israel, and a new clause at 652.225-71, Section 8(a) of the Export 
Administration Act of 1979, As Amended. This certification and clause 
are required by Section 565 of the Fiscal Year 94/95 Foreign Relations 
Authorizations Act (Pub. L. 103-236), which has continuing effect. A 
new Subpart 625.70 is also added.
     Add a new certification at 652.226-70, Certification of 
Status as a Minority Business Enterprise. This certification is not 
statutorily based. However, Federal agencies are required to report to 
the Minority Business Development Agency information concerning awards 
to minority-owned businesses, both large and small. Since this 
information is not readily available, this certification represents the 
most logical manner in which to gather this information. A 
justification for including this certification has been approved by the 
agency head. A new Part 626 is also added.
     Eliminate the clause at 652.228-73, Waiver of the Defense 
Base Act. The Department received a waiver from the Department of Labor 
for service contracts performed overseas for employees who are not U.S. 
citizens or

[[Page 65729]]

residents, or who are not hired in the U.S. Therefore, this clause is 
unnecessary. The associated prescription at 628.305(b)(3) is also 
removed.
     Combine the clauses at 652.228-71, Worker's Compensation 
Insurance (Defense Base Act)--Services, and 652.228-72, Worker's 
Compensation Insurance (Defense Base Act)--Construction, into one 
clause with an alternate. Since the two clauses were virtually 
identical, it was determined to make coverage for construction 
contracts an Alternate I. The clause prescriptions at 628.305(b) have 
been revised accordingly.
     Combine the provisions at 652.228-74, Defense Base Act 
Insurance Rates--Limitation--Services, and 652.228-75, Defense Base Act 
Insurance Rates--Limitation--Construction, into one provision. The 
associated prescriptions at 628.306(a) are revised accordingly.
     Combine the provisions at 652.228-76, Defense Base Act 
Insurance Rates--Limitation--Cost-Reimbursement, and 652.228-77, 
Defense Base Act Insurance Rates--Limitation--Labor-Hour and Time-and-
Material, into one provision. The associated prescriptions at 628.307 
and 628.307-70 are revised accordingly.
     Add a new clause at 652.229-71, Personal Property 
Disposition at Posts Abroad. Department of State regulations at 22 CFR 
part 136 require that contractors that may have importation or tax 
privileges in a foreign country because of their contractual 
relationship to the U.S. Government follow these regulations and the 
procedures established by the chief of mission. The regulations are 
intended to ensure that individuals do not profit personally from sales 
or other transactions with persons who are not themselves entitled to 
exemption from import restrictions, duties, or taxes. A new section 
649.402 is added accordingly.
     Revise the clauses at 652.232-70, Payment Schedule and 
Invoice Submission (Fixed-Price), and 652.232-71, Voucher Submission 
(Cost-Reimbursement), to add the SF-1449 and to correct the block 
numbers to which the payment requests are to be sent.
     Add a new clause at 652.232-72, Limitation of Funds. This 
clause allows for the incremental funding of fixed-price, labor-hour, 
and time-and-material contracts for severable services. An associated 
prescription at 632.705-70 is also added.
     Add a new clause at 652.236-70, Accident Prevention. In 
accordance with a class deviation approved by the Procurement 
Executive, this clause will replace FAR 52.236-13 for use in overseas 
construction contracts not exceeding $500,000, since 52.236-13 refers 
to 29 CFR and the Corps of Engineers safety regulations and manuals 
which are not practical on such contracts overseas.
     Revise the clause at 652.237-71, Identification/Building 
Pass, to correct the address of the Building Pass Application Unit.
     Eliminate the clause at 652.246-70, Commercial Warranty. 
FAR Part 12, Acquisition of Commercial Items, contains adequate 
coverage in FAR 12.404 regarding warranties. Contracting officers shall 
follow the guidance in FAR 12.404(b) regarding use of express 
warranties. The associated prescription at 646.710-70 is also removed.
    The proposed rule also eliminates internal coverage from the 
codified version of the DOSAR. The entire DOSAR, which may be found on 
the Internet (see DOSAR 601.105-3 for the Internet address), will 
contain both the codified and uncodified sections. This change is being 
made for ease of administration and updating of the DOSAR. Internal 
procedures which do not affect contractors or the public need not be 
published for comment. This is consistent with FAR 1.301(a)(2) which 
states, in part, that ``* * * any agency head may issue or authorize 
the issuance of internal agency guidance at any organizational level'', 
and FAR 1.301(b) which states, in part, that ``* * * Issuances under 
1.301(a)(2) need not be publicized for public comment.'' Removing such 
passages from the DOSAR will result in the Department being able to 
easily update these internal procedures without having to pursue the 
formal rulemaking process. As such, the following sections are deleted 
from the codified sections of the DOSAR:
     DOSAR 601.471, which contains procedural guidance to 
contracting officers for requesting deviations from the FAR or DOSAR.
     DOSAR 601.602-3 and 601.602-3-70 regarding ratification of 
unauthorized commitments. These sections contain detailed guidance on 
the authority levels for ratifications and the documentation 
requirements for unauthorized commitments.
     DOSAR 603.203 on reporting suspected violations of the 
Gratuities clause. This section contains procedural guidance for 
reporting such violations to internal DOS entities.
     DOSAR Subpart 603.3 on reporting suspected antitrust 
violations. This section contains procedural guidance for reporting 
such violations to internal DOS entities.
     DOSAR Subpart 604.2, which contains guidance on internal 
distribution of contractual documents.
     DOSAR Subpart 604.70 which contains guidance for internal 
review of solicitations and contracts by contracting officers and the 
Office of the Procurement Executive (A/OPE).
     DOSAR 605.207 on the preparation and transmittal of CBD 
synopses to A/OPE by overseas contracting activities.
     DOSAR Subpart 616.1 on selecting contract types. This 
provides internal guidance to overseas contracting officers on the 
limits of their authority in terms of awarding specific types of 
contracts.
     DOSAR Subpart 616.6, which describes determination and 
findings requirements for time-and-materials, labor-hour, and letter 
contracts.
     DOSAR Subpart 625.9 regarding the approval authority for 
foreign acquisition clauses.
     DOSAR 633.211, which provides instructions to the 
contracting officer on final decision letters and approval authorities.
     DOSAR 649.111 regarding internal approval authorities for 
the review of proposed termination settlements.
    Finally, the proposed rule makes some technical amendments and 
corrections to conform the DOSAR to recent changes in the FAR. The more 
substantial changes are:
     Revision to 601.603-3 to provide guidance on temporary 
contracting officer warrants.
     Elimination of 601.670 regarding the Procurement Career 
Management Program. This elimination is consistent with FAC 90-23, 
which provided coverage on such programs in the FAR.
     Revision of 603.104 regarding procurement integrity 
requirements to conform to FAC 90-45.
     Addition of a new Subpart 603.9 to identify that the 
Procurement Executive is the agency head's designee for purposes of 
this subpart.
     Extension of the waiver in 605.202-70 to May 19, 2001, as 
approved by the agency head.
     Removal of Subpart 608.3 regarding utility services and 
the creation of a new Part 641, per FAC 90-23.
     Removal of Part 610 dealing with the Department's Metric 
Program and its inclusion in Part 611. FAC 90-32 revised FAR Part 10 to 
deal with market research. Information on describing agency needs was 
moved to FAR Part 11.
     Revision of Part 613 in its entirety to conform to the 
reorganization of FAR Part 13 as implemented in FAC 97-3.
     Revision of Subpart 614.2 for better clarity.

[[Page 65730]]

     Revision of Part 615 in its entirety to conform to the 
revision of FAR Part 15 as implemented in FAC 97-2.
     Addition of a new 616.505 to designate an ombudsman for 
task and delivery order contracts.
     Removal of 633.105 regarding protests to the GSBCA, as 
that forum was eliminated per FAC 90-41. Changes have also been made to 
633.104, protests to GAO, to delete obsolete, internal coverage.
     Removal of 634.001, definition of ``major system'', as the 
FAR now provides a definition in FAR Part 2. Further information can be 
found in DOSAR Part 602.
     Removal of Part 639, Acquisition of Information Resources, 
per FAC 90-41, which eliminated the FIRMR.
     Addition of a new Subpart 647.2, Contracts for 
Transportation or for Transportation-Related Services. This subpart 
implements a class deviation approved by the Procurement Executive to 
revise the amount reflected in paragraph (c) of FAR 52.247-3, 
Contractor Liability for Loss of and/or Damage to Household Goods. The 
amount of $5.00 per pound (or metric equivalent based on local 
currency) based on the total net weight is consistent with liability 
calculations found in International Through Government Bills of Lading 
(ITGBL).

II. Impact

    The Department of State 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.).

III. Unfunded Mandates Act of 1995

    The Unfunded Mandates Act of 1995 requires agencies to prepare 
several analytical statements before proposing any rule that may result 
in annual expenditures of $100 million of State, local, and Indian 
tribal governments or the private sector. Since this proposed rule will 
not result in expenditures of this magnitude, the Department certifies 
that such statements are not necessary.

IV. Paperwork Reduction Act

    The information collection requirements contained in this rule have 
been approved under the Paperwork Reduction Act of 1980 by OMB, and 
were assigned control number 1405-0050.

List of Subjects in 48 CFR Parts 601, 602, 603, 604, 605, 606, 608, 
609, 610, 611, 613, 614, 615, 616, 617, 619, 622, 623, 625, 626, 
628, 629, 630, 631, 632, 633, 634, 636, 637, 639, 641, 642, 643, 
644, 645, 646, 647, 649, 652, 653

    Government procurement.

    Accordingly, title 48, chapter 6 of the Code of Federal Regulations 
is amended as follows:
    1. The authority citation for 48 CFR Parts 601, 602, 603, 604, 605, 
606, 608, 609, 610, 614, 616, 617, 619, 620, 622, 623, 625, 626, 628, 
629, 630, 631, 632, 633, 634, 636, 637, 639, 642, 643, 645, 646, 647, 
649, 652, 653 continues to read as follows:

    Authority: 40 U.S.C. 486(c); 22 U.S.C. 2658.

SUBCHAPTER A--GENERAL

PART 601--DEPARTMENT OF STATE ACQUISITION REGULATION


601.105  [Redesignated as 601.106]

    2. Section 601.105 is redesignated as section 601.106. A new 
section 601.105, consisting of section 601.105-3, is added to read as 
follows:


601.105  Issuance.


601.105-3  Copies.

    The DOSAR is available on CD-ROM disks through the Department's 
INFOEXPRESS program, or through the Internet from A/OPE's Acquisition 
Website. The Internet address is: http://www.statebuy.inter.net/
home.htm.
    3. Newly designated section 601.106 is revised to read as follows:


601.106  OMB approval under the Paperwork Reduction Act.

    The Paperwork Reduction Act of 1980 (44 U.S.C. 3501-3520) requires 
that Federal agencies obtain approval from the Office of Management and 
Budget before collecting information from ten (10) or more members of 
the public. Individuals are not required to respond to information 
collection unless the OMB number and burden estimate information is 
provided. Accordingly, the information and recordkeeping requirements 
contained in this regulation have been approved by OMB under OMB 
Control Number 1405-0050. The burden estimate is 225,302 hours.


601.301  [Amended]

    4. Section 601.301 is amended by redesignating paragraph (a)(1) as 
paragraph (a) and by removing paragraph (a)(2) in its entirety.


601.302  [Amended]

    5. Section 601.302 is amended in the first sentence of paragraph 
(a) by removing the words ``and leases of real and personal property''.


601.303  [Amended]

    6. Section 601.303 is amended by correcting the citation at the end 
of paragraph (c) to read ``FAR 1.105-2(c)''.


601.471  [Amended]

    7. Section 601.471 is removed.
    8. The heading of Subpart 601.6 is revised to read as follows:

Subpart 601.6--Career Development, Contracting Authority, and 
Responsibilities


601.602-3 and 601.602-3-70  [Removed]

    9. Section 601.602-3, and section 601.602-3-70, are removed.
    10. Section 601.603-3 is amended by adding a title to paragraph 
(a); by revising the second sentence of paragraph (a); by revising 
paragraph (b) in its entirety; and, by adding a new paragraph (d), to 
read as follows:


601.603-3  Appointment.

    (a) General. * * * The Procurement Executive appoints all DOS 
contracting officers, in conformance with FAR 1.603-3, with the one 
exception as noted in paragraph (b) of this section. * * *
    (b) Temporary warrants. The Chief of Mission is delegated the 
authority by the Procurement Executive to issue temporary contracting 
officer warrants for periods up to 90 calendar days in order to cover 
emergency, post-specific operational requirements (e.g., staffing gaps, 
medical evacuations, extended leave, etc.). These temporary 
appointments shall be executed on the Standard Form 1402, and a copy 
shall be furnished to A/OPE. The warrant shall contain both a dollar 
limitation of no more than $100,000 and a specific time period (not to 
exceed 90 days) during which the warrant is effective.
* * * * *
    (d) Personal services agreements. Individuals who may sign personal 
services agreements (PSAs) are limited to the following:
    (1) An individual, or class of individuals, granted authority by 
the Director, PER/OE; or
    (2) Individuals with contracting officer certificates of 
appointment.


601.603-70  [Amended]

    11. Section 601.603-70 is amended--
    (a) By adding a period after the words ``and services'' and 
removing the words ``to sell personal property; and to lease real 
property.'' in the first sentence of paragraph (a)(1) introductory 
text;
    (b) By adding a period after the words ``Deputy Assistant Secretary 
for Foreign

[[Page 65731]]

Buildings'' and removing the words ``and to the Director for 
Acquisitions as the HCA.'' in paragraph (a)(2);
    (c) By removing the heading ``Office of Acquisition'' and inserting 
``Office of Logistics Management; Office of Acquisition Management (A/
LM/AQM)'' in its place; and by removing the words ``and Deputy Director 
as the HCA'' and inserting ``or designee as the HCA'' in their place in 
paragraph (a)(3);
    (d) By removing the word ``and'' before the word ``construction'' 
and removing the word ``of'' after ``construction'' and by adding the 
words ``and supplies for'' after the word ``construction'' in paragraph 
(a)(7);
    (e) By adding the word ``supplies,'' after the word ``subsystems,'' 
in paragraph (a)(8);
    (f) By revising subparagraph (a)(9) to read as indicated below;
    (g) By removing the words ``Office of Acquisition'' and inserting 
the acronym ``A/LM/AQM'' in their place in the second sentence of 
paragraph (b) introductory text;
    (h) By removing the words ``schedule contracts'' and inserting the 
words ``existing contracts up to the maximum ordering threshold or 
limitation'' in their place in paragraphs (b)(1) through (b)(6); and
    (i) By adding a new paragraph (b)(7), to read as follows:


601.603-70  Delegations of authority.

    (a) * * *
    (9) Regional Procurement Support Offices. The authority to enter 
into and administer contracts for the expenditure of funds involved in 
the acquisition of supplies, equipment, publications, and services on 
behalf of overseas posts is delegated to each Director, Regional 
Procurement Support Office (RPSO) as the HCA at the following 
locations:
    (i) RPSO Germany in conjunction with Embassy Bonn and Consulate 
General Frankfurt;
    (ii) RPSO Tokyo in conjunction with Embassy Tokyo;
    (iii) RPSO Singapore in conjunction with Embassy Singapore; and,
    (iv) RPSO Florida in conjunction with the Florida Regional Center.
    (b) * * *
    (7) Office of Small and Disadvantaged Business Utilization. The 
authority to enter into and administer 8(a) purchase orders and 
contracts as a third party pursuant to the Memorandum of Understanding 
signed with the Small Business Administration.


601.670  [Removed]

    12. Section 601.670 is removed.

PART 602--DEFINITIONS OF WORDS AND TERMS

    13. Section 602.101-70 is amended by removing the definition of 
``local procurement''; and by adding, in alphabetical order, a 
definition of ``major system'' to read as follows:


602.101-70  DOSAR definitions.

* * * * *
    Major System has the same definition as described in FAR 2.101; 
however, the Department of State's dollar threshold as defined in 
paragraph (b) is $30 million. The Under Secretary for Management is the 
head of the agency for the purposes of paragraph (c).
* * * * *

PART 603--IMPROPER BUSINESS PRACTICES AND PERSONAL CONFLICTS OF 
INTEREST

    14. Subpart 603.1 is revised to read as follows:

Subpart 603.1--Safeguards

Sec.
603.104  Procurement integrity.
603.104-5  Disclosure, protection, and marking of contractor bid or 
proposal information and source selection information.
603.104-10  Violations or possible violations.

Subpart 603.1--Safeguards


603.104  Procurement integrity.


603.104-5  Disclosure, protection, and marking of contractor bid or 
proposal information and source selection information.

    (a) The following classes of persons may be authorized to receive 
contractor bid or proposal information or source selection information 
by the contracting officer or head of the contracting activity, who is 
the agency head's designee, when such access is necessary to the 
conduct of an acquisition:
    (1) Individuals involved in the selection process, such as the 
Contracting Officer's Representative, technical evaluators, advisors, 
consultants, and the Source Selection Official;
    (2) Clerical personnel directly involved in the acquisition;
    (3) Supervisors in the contracting officer's chain of command;
    (4) Contracting personnel involved in reviewing or approving the 
solicitation, contract, or contract modification;
    (5) Individuals from offices who may be required to perform pre-
award audits, such as DCAA; and,
    (6) Personnel in the following offices: Office of Small and 
Disadvantaged Business Utilization (A/SDBU), Office of the Legal 
Adviser, Office of Legislative Affairs, Office of the Inspector 
General, Office of the Procurement Executive, the Small Business 
Administration, and the Office of Federal Contract Compliance Programs 
(Department of Labor).
    (c) All information which is considered proprietary or source 
selection information shall be marked to prevent its unauthorized 
disclosure before award. This may be performed by marking each page of 
proprietary or source selection material with the statement ``Source 
Selection Information--See FAR 3.104'' or ``Proprietary Information--
See FAR 3.104'', as applicable. Alternatively, this requirement may be 
met by attaching Forms DS-1926, Proprietary Information (Cover Page), 
and DS-1927, Source Selection Information (Cover Page), to any 
proprietary and source selection information. Individuals responsible 
for preparing derivative documents which reference, cite, or paraphrase 
proprietary or source selection information, are responsible for 
marking such documents as indicated in this paragraph. The required 
marking or cover page shall be included when technical proposals are 
submitted for evaluation and when an audit is requested. After award, 
the procedures governing the Freedom of Information Act and related 
laws/regulations shall be followed regarding release of proprietary or 
source selection information.


603.104-10  Violations or possible violations.

    (a)(1) The contracting officer shall report any violation or 
possible violation to the head of the contracting activity after he or 
she has reviewed the documentation and has concluded that there is no 
impact on the acquisition.
    (d)(2)(ii)(B) The Procurement Executive is the agency head's 
designee for the purposes of FAR 3.104-10(d)(2)(ii)(B).


603.203  [Removed]

    15. Section 603.203 is removed.

Subpart 603.3--[Removed]

    16. Subpart 603.3, consisting of section 603.303, is removed.
    17. Section 603.405 is added to read as follows:


603.405  Misrepresentations or violations of the Covenant Against 
Contingent Fees.

    (a) The contracting officer may request the Office of the Inspector 
General to develop further information if the facts available are 
deemed insufficient to determine whether an actual violation has 
occurred. The

[[Page 65732]]

contracting officer may also obtain the advice of the Office of the 
Legal Adviser as to the legality and general propriety of any 
information disclosed.


603.408  [Removed]

    18. Section 603.408, consisting of section 603.408-1, is removed.


603.670  [Removed]

    19. Section 603.670 is removed.
    20. Subpart 603.9 is added to read as follows:

Subpart 603.9--Whistleblower Protections for Contractor Employees

Sec.
603.905  Procedures for investigating complaints.
603.906  Remedies.

Subpart 603.9--Whistleblower Protections for Contractor Employees


603.905  Procedures for investigating complaints.

    The Procurement Executive is the agency head's designee for the 
purposes of FAR 3.905.


603.906  Remedies.

    The Procurement Executive is the agency head's designee for the 
purposes of FAR 3.906.

PART 604--ADMINISTRATIVE MATTERS

Subpart 604.2--[Removed]

    21. Subpart 604.2, consisting of section 604.202, is removed.

Subpart 604.4--[Removed]

    22. Subpart 604.4, consisting of sections 604.404 and 604.404-70, 
is removed.
    23. Subpart 604.5 is added to read as follows:

Subpart 604.5--Electronic Commerce in Contracting

Sec.
604.502  Policy.
604.505  FACNET certification.
604.505-2  Full certification.
604.506  Exemptions.

Subpart 604.5--Electronic Commerce in Contracting


604.502  Policy.

    (b) The Procurement Executive is the agency head for the purpose of 
FAR 4.502(b).


604.505  FACNET certification.


604.505-2  Full certification.

    (a)(3) The Assistant Secretary of State for Administration is the 
head of the agency for the purpose of FAR 4.505-2(a)(3).


604.506  Exemptions.

    (b) The Assistant Secretary of State for Administration is the head 
of the agency for the purpose of FAR 4.506(b).
    24. Subpart 604.70, consisting of sections 604.7001 and 604.7002, 
is removed.

SUBCHAPTER B--COMPETITION AND ACQUISITION PLANNING

PART 605--PUBLICIZING CONTRACT ACTIONS

    25. Section 605.202-70 is amended by removing the date ``June 15, 
1998'' and inserting the date ``May 19, 2001'' in its place in the last 
sentence of paragraph (a).
    26. Section 605.207 is removed.
    27. Section 605.303 is amended by inserting a comma after the word 
``Affairs''; and by adding the words ``upon request,'' after the word 
``Affairs'' in the first sentence of paragraph (a).

PART 606--COMPETITION REQUIREMENTS

    28. Subpart 606.1, consisting of sections 606.101 and 606.101-70, 
is removed.
    29. Section 606.302-6 is amended by removing ``E.O. 12356'' and 
inserting ``E.O. 12958'' in its place wherever it appears in paragraphs 
(c)(1) introductory text and (c)(1)(vi) .
    30. Section 606.304 is amended in paragraph (a)(2) by removing the 
amounts ``$100,000'' and ``$1,000,000'' and inserting ``$500,000'' and 
``$10,000,000'' in their place, respectively.
    31. Section 606.501 is amended by revising the first sentence of 
paragraph (b) to read as follows:


606.501  Requirement.

* * * * *
    (b) A contracting activity competition advocate has been designated 
for A/LM/AQM. * * *
    32. Section 606.570 is revised to read as follows:


606.570  Solicitation provision.

    The contracting officer shall insert the provision at 652.206-70, 
Competition Advocate/Ombudsman, in all solicitations exceeding the 
simplified acquisition threshold.

PART 608--REQUIRED SOURCES OF SUPPLIES AND SERVICES

    33. Part 608, consisting of subpart 608.3 and section 608.302, is 
removed.

PART 609--CONTRACTOR QUALIFICATIONS

    34. Section 609.206, consisting of section 609.206-1, is added to 
read as follows:


609.206  Acquisitions subject to qualification requirements.


609.206-1  General.

    (b) The authority prescribed in FAR 9.206-1(b) is delegated, 
without power of redelegation, to the head of the contracting activity.
    35. Section 609.404 is amended by revising the section heading to 
read as follows:


609.404  List of parties excluded from federal procurement and 
nonprocurement programs.

    36. Section 609.405 is amended by revising paragraphs (d)(4)(i) and 
(d)(4)(ii) to read as follows:


609.405  Effect of listing.

* * * * *
    (d) * * *
    (4)(i) For procurement actions (both domestic and overseas) that do 
not exceed the simplified acquisition threshold, contracting officers 
need not consult the ``List of Parties Excluded from Federal 
Procurement and Nonprocurement Programs'' prior to award. The list 
should be consulted whenever the contracting officer has reason to 
believe that a proposed contractor may appear on the list.
    (ii) Contracting officers at domestic contracting activities shall 
review the ``List of Parties Excluded from Federal Procurement and 
Nonprocurement Programs'', either in hard copy or electronic form, 
prior to awarding a procurement action exceeding the simplified 
acquisition threshold.
    37. Section 609.406-3 is amended in paragraph (b)(7) by removing 
the number ``10'' and inserting the number ``30'' in its place.
    38. Subpart 609.5 is amended by revising the heading to read as 
follows:

Subpart 609.5--Organizational and Consultant Conflicts of Interests

PART 610--SPECIFICATIONS, STANDARDS, AND OTHER PURCHASE 
DESCRIPTIONS

    39. Part 610, consisting of sections 610.002 and 610.002-70, is 
removed.
    40. Part 611 is added to subchapter B to read as follows:

[[Page 65733]]

PART 611--DESCRIBING AGENCY NEEDS

Sec.
611.002  Policy.
611.002-70  Metric system implementation.

Subpart 611.1--Selecting and Developing Requirements Documents

611.103  Market acceptance.

Subpart 611.5--Liquidated Damages

611.502  Policy.

    Authority: 40 U.S.C. 486(c); 22 U.S.C. 2658.

611.002  Policy.


611.002-70  Metric system implementation.

    (a) Policy. The Metric Conversion Act of 1975, as amended by the 
Omnibus Trade and Competitiveness Act of 1988 (15 U.S.C. 205a, et. 
seq.), requires Federal agencies to establish implementing guidelines 
pursuant to metric policy to adopt the metric system as the preferred 
system of weights and measurements for United States trade and 
commerce. This section establishes the Department of State's metric 
conversion guidelines.
    (b) Applicability. This section applies to all DOS acquisitions, 
except to the extent that such use is impractical or is likely to cause 
significant inefficiencies or loss of markets to U.S. firms.
    (c) Definitions.
    Dual system means the use of both traditional and metric systems. 
For example, an item is designated, produced and described in inch-
pound values with soft metric values also shown for information or 
comparison.
    Hard metric means the use of only standard metric (SI) measurements 
in specifications, standards, supplies and services.
    Hybrid system means the use of both traditional and hard metric 
values in specifications, standards, supplies and services.
    Measurement sensitive means any item having an application or 
meaning depending substantially on some measured quantity. For example, 
measurement sensitive items include product or performance criteria and 
standards binding on others, such as emission levels, size and weight 
limitations, etc.
    Metric system means the International System of Units (Le System 
International d'Unites (SI)) of the International Bureau of Weights and 
Measures.
    Metrication means any act that increases metric system use, 
including metric training and initiation or conversion of measurement 
sensitive processes and systems to the metric system.
    Soft metric means the result of mathematical conversion of inch-
pound measurements to metric equivalents. The physical dimensions, 
however, are not changed.
    Traditional system of weights and measurements means the 
predominant weight and measurement system currently used in the United 
States, also referred to as the ``inch-pound system.'' The traditional 
system includes such commonly used units as inch, foot, yard, mile, 
pint, quart, gallon, bushel, ounce (fluid and avoirdupois), pound, 
degree Fahrenheit, ampere, candela, and second.
    (d) Procedures. (1) DOS contracting activities shall implement the 
metric system in a manner consistent with 15 U.S.C. 205a, et seq.
    (2) All DOS contracting activities shall use the metric system in 
acquisition consistent with security, operations, economic, technical, 
logistical, training and safety requirements.
    (3) The Department shall encourage industry to adopt the metric 
system by acquiring commercially available metric products and services 
that meet the Department's needs whenever practical. Toward this end, 
solicitations for DOS acquisitions shall:
    (i) State all measurement sensitive requirements in metric terms 
whenever possible. Alternatives to hard metric are soft, dual and 
hybrid metric terms. The Metric Handbook for Federal Officials 
regarding the selection of proper metric units and symbols is available 
from the National Technical Information Service; and
    (ii) For contracts expected to exceed $500,000 contracting officers 
shall return to the requirements office all specifications and 
statements of work that are not expressed in some form of metric terms 
unless the requirements office has prepared a justification, for the 
approval of the contracting officer, for the use of non-metric 
specifications or statement of work. The justification shall be in a 
format as prescribed by the head of the contracting activity. Option 
year prices shall be considered when computing the $500,000 threshold.
    (4) Waivers are not required when ordering from Federal Supply 
Schedules.
    (5) Valid justifications for non-metric specifications or 
statements of work include, but are not limited to:
    (i) Existing specifications or standards are in inch-pound units, 
unless conversion of the existing specifications or standards is 
necessary or advantageous to the Government. Unnecessary retrofit of 
existing systems with new metric components should be avoided if the 
total cost of the retrofit, including redesign costs, exceeds $50,000;
    (ii) Metric is not the accepted industry system with respect to a 
business-related activity; however, soft, hybrid, or dual systems may 
be used during the transition to hard metric;
    (iii) The use of metric is impractical or is likely to cause 
significant inefficiencies or loss of markets to U.S. firms.
    (6) The contracting officer shall review and, if acceptable, 
approve the waiver prior to the release of the solicitation. The waiver 
shall be placed in the contract file. If the waiver is not approved, 
the contracting officer shall return it to the requirements office with 
an explanation for the disapproval.
    (7) The in-house operating metric costs shall be identified. 
Identification includes, but is not limited to, the cost of metric 
aids, tools, equipment, training and increased cost to develop metric 
specifications. All contracting activities and requirements offices 
shall maintain a record of any costs and/or savings brought about by 
metric conversion.
    (8) Bulk (loose, unpacked) materials shall be specified and 
purchased in metric or dual units.
    (9) Measuring devices, shop and laboratory equipment shall be 
purchased in metric or dual units.
    (10) Shipping allowances, bills of lading and other shipping 
documents shall be expressed in metric or dual units.

Subpart 611.1--Selecting and Developing Requirements Documents


611.103  Market acceptance.

    (a) The head of the contracting activity is the agency head for the 
purpose of FAR 11.103(a).

Subpart 611.5--Liquidated Damages


611.502  Policy.

    (d) The head of the contracting activity is the agency head for the 
purpose of FAR 11.502(d).

SUBCHAPTER C--CONTRACTING METHODS AND CONTRACT TYPES

PART 613--SIMPLIFIED ACQUISITION PROCEDURES

    41. Part 613 is revised to read as follows:

PART 613--SIMPLIFIED ACQUISITION PROCEDURES

Sec.

[[Page 65734]]

Subpart 613.3--Simplified Acquisition Methods

613.303  Blanket purchase agreements (BPAs).
613.303-5  Purchases under BPAs.
613.305  Imprest funds and third party drafts.
613.305-3  Conditions for use.

    Authority: 40 U.S.C. 486(c); 22 U.S.C. 2658.

Subpart 613.3--Simplified Acquisition Methods


613.303  Blanket purchase agreements (BPAs).

613.303-5  Purchases under BPAs.

    (c) In accordance with FAR 13.303-5(c), BPAs shall be awarded to 
small businesses to the maximum extent practicable.


613.305  Imprest funds and third party drafts.

613.305-3  Conditions for use.

    The Procurement Executive is the agency head's designee for the 
purposes of FAR 13.305-3(a).

PART 614--SEALED BIDDING

    42. Subpart 614.2 is revised to read as follows:
Sec.

Subpart 614.2--Solicitation of Bids

614.201  Preparation of Invitation for Bids (IFB).
614.201-70  Use of English language.
614.201-6  Solicitation provisions.
614.201-6-70  DOSAR solicitation provision.

Subpart 614.2--Solicitation of Bids


614.201  Preparation of Invitation for Bids (IFB).


614.201-70  Use of English language.

    Use of English language solicitations and contracts is mandatory 
unless a deviation has been approved by the Procurement Executive in 
accordance with 601.470. If any part of a contract is not written in 
the English language, the contracting officer shall attach an accurate 
English language translation of such part to the original and each copy 
of the contract, unless the contracting officer determines such action 
is infeasible.


614.201-6  Solicitation provisions.


614.201-6-70  DOSAR solicitation provision.

    The contracting officer shall insert the provision at 652.214-71, 
Authorization to Perform, in all solicitations for contracts to be 
awarded or performed overseas.
    43. Section 614.404-1 is amended by adding a new paragraph (f) to 
read as follows:


614.404-1  Cancellation of invitations after opening.

* * * * *
    (f) The head of the contracting activity is the agency head for the 
purpose of FAR 14.404-1(f). This authority is not redelegable.
    44. Section 614.406, consisting of sections 614.406-3 and 614.406-
4, is re-designated as ``614.407'', ``614.407-3'', and ``614.407-4'', 
respectively.
    45. Newly designated section 614.407-3 is amended by correcting 
``FAR 14.406'' to read ``FAR 14.407'' where it appears in the first 
sentence; and, by correcting ``FAR 14.406-3(f)'' to read ``FAR 14.407-
3(f)'' where it appears in the second sentence.
    46. Newly designated section 614.407-4 is amended by correcting 
``FAR 14.406-4'' to read ``FAR 14.407-4'' where it appears in the first 
sentence; and, by correcting ``FAR 14.406-4(d)'' to read ``FAR 14.407-
4(d)'' where it appears in the second sentence.

PART 615--CONTRACTING BY NEGOTIATION

    47. Part 615 is revised to read as follows:

PART 615--CONTRACTING BY NEGOTIATION

Sec.

Subpart 615.2--Solicitation and Receipt of Proposals and Information

615.204  Contract format.
615.205  Issuing solicitations.
615.205-70  Use of English language.
615.209  Solicitation provisions and contract clauses.
615.209-70  DOSAR solicitation provision.

Subpart 615.3--Source Selection

615.303  Responsibilities.

Subpart 615.6--Unsolicited Proposals

615.604  Agency points of contact.

    Authority: 40 U.S.C. 486(c); 22 U.S.C. 2658.

Subpart 615.2--Solicitation and Receipt of Proposals and 
Information


615.204  Contract format.

    (e) The Procurement Executive is the agency head's designee for the 
purposes of FAR 15.204(e).


615.205  Issuing solicitations.

    (a) Contracting officers shall release copies of solicitation 
mailing lists in accordance with FAR 14.205-5(a). However, the list of 
those firms which actually submit proposals is not releasable. Requests 
for information other than solicitation mailing lists shall be handled 
under the Freedom of Information Act.


615.205-70  Use of English language.

    The requirements of DOSAR 614.201-70 also apply when contracting by 
negotiation.


615.209  Solicitation provisions and contract clauses.


615.209-70  DOSAR solicitation provision.

    The contracting officer shall insert the provision at 652.214-71, 
Authorization to Perform, in all solicitations for contracts to be 
awarded or performed overseas.

Subpart 615.3--Source Selection


615.303  Responsibilities.

    (a) The Procurement Executive is the agency head for the purposes 
of FAR 15.303(a).

Subpart 615.6--Unsolicited Proposals


615.604  Agency points of contact.

    (a)(4) The contact points for unsolicited proposals are the heads 
of the contracting activities.

PART 616--TYPES OF CONTRACTS

    48. Subpart 616.1, consisting of sections 616.102, 616.102-70, is 
removed.
    49. Subpart 616.3, consisting of sections 616.301-3 and 616.306, is 
removed.
    50. Section 616.505 is re-designated as section 616.506, and the 
section heading is revised to read as follows:


616.506  Solicitation provisions and contract clauses.

    51. Section 616.505-70 is re-designated as section 616.506-70.
    52. A new section 616.505 is added to read as follows:


616.505  Ordering.

    (b)(4) The Departmental Competition Advocate is designated the task 
and delivery order contract ombudsman.
    53. Subpart 616.6, consisting of sections 616.603 and 616.603-2, is 
removed.

PART 617--SPECIAL CONTRACTING METHODS

    54. Subpart 617.1 is revised to read as follows:

Subpart 617.1--Multiyear Contracting

Sec.
617.104  General.
617.105  Policy.
617.105-1  Uses.
617.108  Congressional notification.

[[Page 65735]]

Subpart 617.1--Multiyear Contracting


617.104  General.

    (b) The Procurement Executive is the agency head for the purpose of 
FAR 17.104(b).


617.105  Policy.


617.105-1  Uses.

    (d) In the event that funds for the continuation of such a contract 
are not made available into a subsequent fiscal year, the contract 
shall be canceled. Any cancellation costs incurred shall be paid from 
appropriations originally available for the performance of the 
contract, appropriations currently available for the acquisition of 
similar property or services and not otherwise obligated, or 
appropriations made for such cancellation payments.


617.108  Congressional notification.

    (a) The Procurement Executive is the agency head for the purposes 
of FAR 17.108(a).
    55. Section 617.504-70 is amended in paragraph (a) by adding the 
words ``or their equivalents'' after the words ``Department deputy 
assistant secretaries.''

SUBCHAPTER D--SOCIOECONOMIC PROGRAMS

PART 619--SMALL BUSINESS PROGRAMS

    56. Part 619 is amended by revising the heading to read as set 
forth above.
    57. Section 619.201 is amended in paragraph (d)(5) by removing the 
word ``limitation'' and adding the words ``threshold, including 
commercial items using the simplified procedures of FAR Subpart 13.5,'' 
in its place; and, by revising paragraph (d)(18) to read as follows:


Sec. 619.201  General policy.

* * * * *
    (d) * * *
    (18) Participating in interagency programs relating to small and 
small disadvantaged business matters as authorized by the A/SDBU 
Operations Director.
    58. Section 619.501 is amended by deleting the phrase ``/Labor 
Surplus Area'' from the title of the Form DS-1910.
    59. Section 619.505 is amended by revising the section heading to 
read as follows:


619.505  Rejecting Small Business Administration recommendations.

    60. Subpart 619.7 is amended by revising the subpart heading to 
read as follows:

Subpart 619.7--Subcontracting with Small Business, Small 
Disadvantaged Business and Women-Owned Small Business Concerns

    61. Section 619.705-3 is revised to read as follows:


619.705-3  Preparing the solicitation.

    To further promote the use of small, disadvantaged, and women-owned 
firms by large prime contractors, contracting officers are encouraged 
to consider the adequacy of the subcontracting plans, and/or past 
performance in achieving negotiated subcontract goals, as part of the 
overall evaluation of the technical proposals.
    62. Subpart 619.8 is revised to read as follows:

Subpart 619.8--Contracting with the Small Business Administration (The 
8(a) Program)

Sec.
619.800  General.
619.801  Definitions.
619.803  Selecting acquisitions for the 8(a) program.
619.803-70  Responsibilities of the Office of Small and 
Disadvantaged Business Utilization (A/SDBU).
619.803-71  Simplified procedures for 8(a) acquisitions under MOUs.
619.804  Evaluation, offering, and acceptance.
619.804-2  Agency offering.
619.804-3  SBA acceptance.
619.804-3-70  SBA acceptance under MOUs for acquisitions exceeding 
$100,000.
619.805  Competitive 8(a).
619.805-2  Procedures.
619.806  Pricing the 8(a) contract.
619.808  Contract negotiation.
619.808-1  Sole source.
619.810  SBA appeals.
619.811  Preparing the contracts.
619.811-1  Sole source.
619.811-2  Competitive.
619.811-3  Contract clauses.
619.812  Contract administration.

Subpart 619.8--Contracting with the Small Business Administration 
(The 8(a) Program)


619.800  General.

    (d) Utilizing Memoranda of Understanding (MOUs), the SBA has 
delegated its authority to contract directly with program participants 
under Section 8(a) of the Small Business Act to the Senior Procurement 
Executives of various Federal contracting activities. The Department of 
State has signed an MOU with SBA, effective May 6, 1998. Under the MOU, 
a contract may be awarded directly to an 8(a) firm on either a sole 
source or competitive basis. The SBA reserves the right to withdraw any 
delegation issued as a result of an MOU; however, any such withdrawal 
shall have no effect on contracts currently awarded under the MOU.


619.801  Definitions.

    National buy requirements includes all 8(a) contracts performed 
outside the United States and processed by the Small Business 
Administration.


619.803  Selecting the acquisitions for the 8(a) program.


619.803-70  Responsibilities of the Office of Small and Disadvantaged 
Business Utilization (A/SDBU).

    A/SDBU shall review the capabilities of 8(a) concerns and 
disseminate that information to DOS program and contracting personnel. 
As necessary, A/SDBU shall obtain from the SBA or 8(a) concerns 
supplemental information for DOS program and contracting personnel.


619.803-71  Simplified procedures for 8(a) acquisitions under MOUs.

    Contracting activities may use the simplified acquisition 
procedures of FAR Part 13 and DOSAR Part 613 to issue purchase orders 
or contracts, not exceeding $100,000, to 8(a) participants. The 
$100,000 limitation for use of FAR Part 13 simplified acquisition 
procedures applies to the acquisition of both commercial and non-
commercial items. The following applies to such acquisitions:
    (a) Neither offering letters to, nor acceptance letters from, the 
SBA are required.
    (b) The contracting activity shall use the SBA's PRO-Net database 
on the Internet (http://www.sba.gov) to establish that the selected 
8(a) firm is a current program participant.
    (c) Once an 8(a) contractor has been identified, the agency 
contracting officer shall establish the price with the selected 8(a) 
contractor.
    (d) The contracting officer shall issue the purchase order or 
contract directly to the 8(a) firm in accordance with the provisions of 
FAR Part 13 and DOSAR Part 613. The contracting officer shall insert 
FAR clause 52.219-14, Limitations on Subcontracting, and DOSAR clause 
652.219-71, Section 8(a) Direct Award, in all purchase orders and 
contracts awarded under this subsection. The contracting officer's 
title shall include the contracting activity, as follows: Contracting 
Officer for the Department of State [insert contracting activity]. In 
addition, in accordance with the MOU, A/SDBU staff who have been issued 
limited contracting officer warrants for this purpose, shall sign the 
purchase order or contract as a third party.

[[Page 65736]]

    (e) The contracting officer shall forward to the SBA District 
Office serving the 8(a) firm a copy of the purchase order or contract 
within five days after the order is issued.


619.804  Evaluation, offering, and acceptance.


619.804-2  Agency offering.

    (a) When applicable, this notification shall identify that the 
offering is in accordance with the MOU identified in 619.800.


619.804-3  SBA acceptance.


619.804-3-70  SBA acceptance under MOUs for acquisitions exceeding 
$100,000.

    (a) The SBA's decision whether to accept the requirement shall be 
transmitted to the contracting agency in writing within five working 
days of receipt of the offer.
    (b) The SBA may request, and the contracting agency may grant, an 
extension beyond the five-day limit.
    (c) SBA's acceptance letter should be faxed or e-mailed to the 
offering contracting agency.
    (d) If the offering contracting agency has not received an 
acceptance or rejection of the offering from SBA within five days of 
SBA's receipt of the offering letter, the contracting agency may assume 
that the requirement has been accepted and proceed with the 
acquisition.
    (e) The contents of the acceptance letter shall be limited to the 
eligibility of the recommended 8(a) contractor.


619.805  Competitive 8(a).


619.805-2  Procedures.

    (a) 8(a) acquisitions may also be conducted using simplified 
acquisition procedures (see FAR Part 13). The award process is 
significantly streamlined where an MOU is in place.
    (c)(3) For requirements exceeding $100,000 processed under the MOU 
cited in 619.800, the contracting officer shall submit the name, 
address, and telephone number of the low offeror (in sealed bid 
acquisitions) or the apparent successful offeror (in negotiated 
acquisitions) to the SBA Business Opportunity Specialist at the field 
office servicing the identified 8(a) firm. The SBA shall determine the 
eligibility of the firm(s) and advise the contracting officer within 
two working days of the receipt of the request. If the firm is 
determined to be ineligible, the contracting officer shall submit 
information on the next low offeror or next apparent successful 
offeror, as applicable, to the cognizant SBA field office.


619.806  Pricing the 8(a) contract.

    (a) When required by FAR Subpart 15.4, the contracting officer 
shall obtain certified cost or pricing data directly from the 8(a) 
contractor if the contract is being awarded under the MOU cited in 
619.800.


619.808  Contract negotiation.


619.808-1  Sole source.

    (a) If the acquisition is conducted under an MOU cited in 619.800, 
the 8(a) contractor is responsible for negotiating with the agency 
within the time established by the agency. If the 8(a) contractor does 
not negotiate within the established time and the agency cannot allow 
additional time, the agency may, after notification and approval by 
SBA, proceed with the acquisition from other sources.
    (b) If the acquisition is conducted under an MOU cited in 619.800, 
the agency is delegated the authority to negotiate directly with the 
8(a) participant; however, if requested by the 8(a) participant, the 
SBA may participate in the negotiations.


619.810  SBA appeals.

    (d) The Procurement Executive is the agency head for the purposes 
of FAR 19.812(d).


619.811  Preparing the contracts.


619.811-1  Sole source.

    (d) If the award is to be made under an MOU cited in 619.800, the 
contract to be awarded by the contracting activity to the 8(a) firm 
shall be prepared in accordance with the contracting activity's normal 
procedures, given contract type and dollar amount, that the contracting 
activity would use for a similar, non-8(a) acquisition, except for the 
following:
    (1) The award form shall cite 41 U.S.C. 253(c)(5) or 10 U.S.C. 
2304(c)(5), as appropriate, and 15 U.S.C. 637(a) as the authority for 
use of other than full and open competition.
    (2) The contracting officer shall insert FAR 52.219-14, Limitations 
on Subcontracting, and DOSAR 652.219-71, Section 8(a) Direct Awards.
    (3) For acquisitions exceeding $100,000, the contracting activity 
shall include SBA's requirement number on the award document.
    (4) A single award document shall be used between the agency and 
the 8(a) contractor, i.e., an SBA signature will not be required. The 
title of the agency contracting officer shall include the contracting 
activity, as follows: Contracting Officer for the Department of State 
[insert contracting activity]. In addition, in accordance with the MOU, 
A/SDBU staff who have been issued limited contracting officer warrants 
for this purpose shall sign the contract as a third party. The 8(a) 
contractor's signature shall be placed on the award document as the 
prime contractor. The 8(a) contractor's name and address shall be 
placed in the ``Awarded to'' or ``Contractor name'' block on the 
appropriate form.


619.811-2  Competitive.

    (a) If the award is made under the delegation of 8(a) contracting 
authority, competitive contracts for 8(a) firms shall be prepared in 
accordance with the same standards as 8(a) sole source contracts. See 
619.811-1.
    (b) If the acquisition is conducted under the MOU cited in 619.800, 
the process for obtaining signatures shall be as specified in 619.811-
1(d)(4).


619.811-3  Contract clauses.

    (d)(3) The contracting officer shall insert the clause at FAR 
52.219-18, Notification of Competition Limited to Eligible 8(a) 
Concerns, with its Alternate III (Deviation), in competitive 
solicitations and contracts exceeding $100,000 when the acquisition is 
processed under the MOU cited in 619.800.
    (f) The contracting officer shall insert the clause at FAR 52.219-
14, Limitations on Subcontracting, and DOSAR 652.219-71, Section 8(a) 
Direct Awards, in all solicitations and contracts that are processed 
under the MOU cited at 619.800. The clauses at FAR 52.219-11, Special 
8(a) Contract Conditions; 52.219-12, Special 8(a) Subcontract 
Conditions; and, 52.219-17, Section 8(a) Award, shall not be used.


619.812  Contract administration.

    (d) The head of the contracting activity is the agency head for the 
purposes of FAR 19.812(d). Awards under the MOU cited in 619.800 are 
subject to 15 U.S.C. 637(a)(21). These contracts contain the clause at 
DOSAR 652.219-71, Section 8(a) Direct Awards, that requires the 8(a) 
contractor to notify the SBA and the contracting officer when ownership 
of the firm is being transferred.

PART 622--APPLICATION OF LABOR LAWS TO GOVERNMENT ACQUISITIONS

    63. Section 622.401 is removed.
    64. Section 622.406-3 is removed.
    65. Section 622.803 is added to read as follows:

[[Page 65737]]

622.803  Responsibilities.

    (c) The Procurement Executive is the agency head for the purpose of 
FAR 22.803(c).
    66. The heading of Subpart 622.13 is revised to read as follows:

Subpart 622.13--Disabled Veterans and Veterans of the Vietnam Era

    67. The heading of Subpart 622.14 is revised to read as follows:

Subpart 622.14--Employment of Workers with Disabilities

PART 623--ENVIRONMENT, CONSERVATION, OCCUPATIONAL SAFETY, AND DRUG-
FREE WORKPLACE

    68. Subpart 623.4 is revised to read as follows:

Subpart 623.4--Use of Recovered Materials

Sec.
623.400  Scope of subpart.
623.404  Procedures.

Subpart 623.4--Use of Recovered Materials


623.400  Scope of subpart.

    The affirmative procurement program is applicable to all domestic 
acquisitions of items currently designated by an EPA guideline or by 
future guidelines promulgated by EPA. The requirements of this section 
are not applicable to acquisitions made and/or performed outside the 
United States or its possessions.


623.404  Procedures.

    (b)(2) The requirements office initiating an acquisition is 
responsible for determining whether recovered materials should be 
included in the specifications. Requirements offices may purchase EPA 
designated items containing other than recovered materials only if one 
of the exemptions listed in FAR 23.404(b)(3) applies. If the 
requirements office determines to acquire EPA designated items that do 
not contain recovered materials, a written justification must be 
submitted to the head of the contracting activity.
    (i) Contracts for the purchase of, or requiring the supply of, any 
EPA designated item shall require that the item conform to the EPA 
guidelines, unless an exception has been approved by the head of the 
contracting activity in accordance with FAR 23.404(b)(3) and DOSAR 
623.404(b)(3).
    (ii) Contracting officers shall promote the fact that the 
Department is seeking to buy items containing recovered materials at 
pre-bid and pre-proposal conferences, when appropriate. Other means of 
promotion may include a specific notice on a solicitation's cover 
letter, calling attention to the requirement for recovered materials.
    (iii) Contracting officers shall include FAR clause 52.223-9 to 
ensure that contractors estimate, certify, and verify the amount of 
recovered material used in the performance of the contract.
    (iv) The effectiveness of the program shall be reviewed annually by 
A/OPE. An assessment will be made to determine if greater use of 
recovered materials is possible for the existing requirements or if 
recovered materials are causing undue delay, lack of competition, 
unreasonable prices, or an unacceptable level of performance.
    (3) The head of the contracting activity is the agency head for the 
purpose of FAR 23.404(b)(3).

PART 625--FOREIGN ACQUISITION

    69. Subpart 625.9, consisting of sections 625.901 and 625.903, is 
removed.
    70. Subpart 625.70 is added to read as follows:

Subpart 625.70--Arab League Boycott and Related Provisions

Sec.
625.7001  Policy.
625.7002  Solicitation provision and contract clause.

Subpart 625.70--Arab League Boycott and Related Provisions


625.7001  Policy.

    (a) Section 565 of the Fiscal Year 94/95 Foreign Relations 
Authorizations Act (Pub. L. 103-236) prohibits the Department of State 
from entering into any contract that expends funds appropriated to the 
Department of State:
    (1) With a foreign person that complies with the Arab League 
Boycott of Israel; or,
    (2) With any foreign or United States person that discriminates in 
the award of subcontracts on the basis of religion.
    This authority has continuing effect. Section 565 requires specific 
language to be included in all Invitations for Bids and Requests for 
Proposals with respect to a contract subject to Section 565's 
prohibitions.
    (b) Section 565 may be waived on a country-by-country basis if such 
a waiver is in the national interest and necessary to carry on 
diplomatic functions.


625.7002  Solicitation provision and contract clause.

    Contracting officers shall include the following provision and 
clause in all solicitations and contracts exceeding the simplified 
acquisition threshold, unless a waiver has been granted in accordance 
with DOSAR 625.7001(b):
    (a) 652.225-70, Arab League Boycott of Israel; and
    (b) 652.225-71, Section 8(a) of the Export Administration Act, as 
amended.
    71. Part 626 is added to subchapter D to read as follows:

PART 626--OTHER SOCIOECONOMIC PROGRAMS

Subpart 626.2--Minority Business Enterprise


626.200-70  Solicitation provision.

    The contracting officer shall insert the provision at 652.226-70, 
Certification of Status as a Minority Business Enterprise, in all 
solicitations issued by domestic contracting activities. If the 
solicitation is being issued using electronic commerce, the contracting 
officer shall use the provision with its Alternate I.

SUBCHAPTER E--GENERAL CONTRACTING REQUIREMENTS

PART 628--BONDS AND INSURANCE

    72. Section 628.305 is amended by revising the second and third 
sentences of paragraph (b) introductory text and adding a fourth 
sentence to read as follows; and by removing paragraphs (b)(1), (b)(2), 
and (b)(3):


628.305  Overseas workers' compensation and war-hazard insurance.

* * * * *
    (b) * * * In countries where local nationals and/or third country 
nationals will be employed to perform the contract, such countries have 
been waived by the Secretary of Labor. Whenever such insurance is 
required under the contract, the contracting officer shall insert the 
clause at 652.228-71, Worker's Compensation Insurance (Defense Base 
Act)--Services. If the contract is for construction, the contracting 
officer shall insert the clause with its Alternate I.
* * * * *
    73. Section 628.306 is revised to read as follows:


628.306  Insurance under fixed-price contracts.

    The contracting officer shall insert the provision at 652.228-74, 
Defense Base Act Insurance Rates--Limitation--Fixed-Price, in 
solicitations for fixed-price or construction contracts to be performed 
outside the United States by United States citizens, residents, and/or 
those hired in the United States.
    74. Section 628.307 is revised to read as follows:

[[Page 65738]]

628.307  Insurance under cost-reimbursement contracts.

    The contracting officer shall insert the provision at 652.228-76, 
Defense Base Act Insurance Rates--Limitation--Cost-Reimbursement, 
Labor-Hour, and Time-and-Materials, in solicitations for cost-
reimbursement, labor-hour, or time-and-materials type contracts to be 
performed outside the United States by United States citizens, 
residents, and/or those hired in the United States.
    75. Section 628.307-70 is removed.

PART 629--TAXES

    76. Section 629.402, consisting of sections 629.402-1 and 629.402-
1-70, is added to read as follows:


629.402  Foreign contracts.


629.402-1  Foreign fixed-price contracts.


629.402-1-70  DOSAR contract clause.

    The contracting officer shall insert the clause at 652.229-71, 
Personal Property Disposition at Posts Abroad, in all solicitations and 
contracts performed overseas.

PART 630--COST ACCOUNTING STANDARDS

    77. Part 630 is removed.

PART 631--CONTRACT COST PRINCIPLES AND PROCEDURES

    78. Subpart 631.2 is added to read as follows:

Subpart 631.2--Contracts with Commercial Organizations


631.205  Selected costs.


631.205-6  Compensation for personal services.

    (g)(3) The head of the contracting activity is the agency head's 
designee for the purpose of FAR 31.205-6(g)(3).

PART 632--CONTRACT FINANCING

    79. Section 632.006, consisting of sections 632.006-1, 632.006-2, 
and 632.006-4, is added to read as follows:

PART 632--CONTRACT FINANCING

Sec.
632.006  Reduction or suspension of contract payments upon finding 
of fraud.
632.006-1  General.
632.006-2  Definitions.
632.006-4  Procedures.


632.006  Reduction or suspension of contract payments upon finding of 
fraud.


632.006-1  General.

    The Procurement Executive is the agency head for the purpose of FAR 
32.006-1.


632.006-2  Definitions.

    Remedy coordination official means the Assistant Inspector General 
for Investigations.


632.006-4  Procedures.

    The Procurement Executive is the agency head for the purposes of 
FAR 32.006-4.
    80. Subpart 632.1 is added to read as follows:


632.1  Non-Commercial Item Purchase Financing


632.114  Unusual contract financing.

    The Procurement Executive is the agency head for the purpose of FAR 
32.114.
    81. Subpart 632.2 is added to read as follows:

Subpart 632.2--Commercial Item Purchase Financing


632.201  Statutory authority.

    The head of the contracting activity is the agency head for the 
purpose of FAR 32.201.
    82. Section 632.404 is added to read as follows:


632.404  Exclusions.

    (a) Total advance payments may be authorized for the items listed 
in FAR 32.404(a), notwithstanding their designation as a commercial 
item and acquisition under FAR Part 12 procedures.
    83. Subpart 632.7 is revised to read as follows:

Subpart 632.7--Contract Funding

Sec.
632.702  Policy.
632.702-70  DOS policy.
632.703  Contract funding requirements.
632.703-3  Contracts crossing fiscal years.
632.705  Contract clauses.
632.705-70  DOSAR contract clause.

Subpart 632.7--Contract Funding


632.702  Policy.


632.702-70  DOS policy.

    The Department's policy is to provide full funding for all 
contracts, to the maximum extent practicable. FAR 32.704 and 32.705-2 
provide for incremental funding of cost-reimbursement contracts. Fixed-
price, labor-hour, and time-and-materials contracts for severable 
services may also be incrementally funded if full funding is not 
available at the time of contract award and the contracting officer 
executes a determination and findings, approved by the requirements 
office, justifying the need for incremental funding due to the 
unavailability of funds.


632.703  Contract funding requirements.


632.703-3  Contracts crossing fiscal years.

    (b) The head of the contracting activity is the agency head for the 
purpose of FAR 32.703-3(b).


632.705  Contract clauses.


632.705-70  DOSAR contract clause.

    The contracting officer shall insert the clause at 652.232-72, 
Limitation of Funds, in incrementally funded fixed-price, labor-hour, 
and time-and-materials solicitations and contracts for severable 
services.
    84. Section 632.803 is amended by adding the following sentence to 
the end of paragraph (b):


632.803  Policies.

    (b) * * * The Directors, Regional Procurement Support Offices may 
approve the assignment of claims for contracts under their 
administration after obtaining legal consultation.

PART 633--PROTESTS, DISPUTES AND APPEALS

    85. Section 633.102 is amended by removing the words ``or the 
General Services Administration Board of Contract Appeals (GSBCA)''.
    86. Section 633.103 is revised to read as follows:


633.103  Protests to the agency.

    (d)(4) The independent review as described in FAR 33.103(d)(4) 
shall be performed by the Departmental Competition Advocate.
    87. Section 633.104 is revised to read as follows:


633.104  Protests to GAO.

    (a) General procedures. The Office of the Assistant Legal Adviser 
for Buildings and Acquisitions (L/BA) coordinates the response of the 
Department of State to protests filed at the GAO. Contracting 
activities shall consult L/BA for guidance before taking any actions in 
response to a protest to GAO.
    88. Section 633.105 is removed.
    89. Section 633.211 is removed.

SUBCHAPTER F--SPECIAL CATEGORIES OF CONTRACTING

PART 634--MAJOR SYSTEM ACQUISITION

    90. Sections 634.001, 634.001-70, and 634.002 are removed.
    91. Section 634.003 is amended in paragraph (a) by removing the 
second sentence.
    92. Section 634.005-6 is amended by removing the period at the end 
of the sentence and adding the following

[[Page 65739]]

words to the end of the sentence ``with power of redelegation to the 
Under Secretary for Management.''

PART 636--CONSTRUCTION AND ARCHITECT-ENGINEERING CONTRACTS

    93. Section 636.101-70 is amended by adding the following sentence:


636.101-70  Exception.

    * * * The Deputy Assistant Secretary for Foreign Buildings 
Operations is authorized to waive the provisions of the FAR.
    94. Subpart 636.5 is added to read as follows:

Subpart 636.5--Contract Clauses


636.513  Accident prevention.

    (a) In accordance with a class deviation approved by the 
Procurement Executive, contracting officers at overseas contracting 
activities shall insert DOSAR 652.236-70, Accident Prevention, in lieu 
of FAR clause 52.236-13 when awarding construction contracts.
    95. Section 636.602-1 is added to read as follows:


636.602-1  Selection criteria.

    (b) The head of the contracting activity is the agency head's 
designee for the purpose of FAR 36.602-1(b).

PART 637--SERVICE CONTRACTING

    96. Section 637.106 is removed.
    97. Section 637.110 is amended by adding the following sentence to 
the end of paragraph (c):


637.110  Solicitation provisions and contract clauses.

* * * * *
    (c) * * * Overseas contracting activities may add local holidays to 
the list included in paragraph (a) of the clause.
    98. Subpart 637.2 is added to read as follows:

Subpart 637.2--Advisory and Assistance Services


637.204  Guidelines for determining availability of personnel.

    The head of the contracting activity is the agency head for the 
purposes of FAR 37.204.

PART 639--ACQUISITION OF INFORMATION RESOURCES

    99. Part 639, consisting of section 639.001-70, is removed.
    100. Part 641 is added to subchapter F to read as follows:

PART 641--ACQUISITION OF UTILITY SERVICES

    Authority: 40 U.S.C. 486(c); 22 U.S.C. 2658.

Subpart 641.2--Acquiring Utility Services


641.201  Policy.

    (d) The Procurement Executive is the agency head for the purposes 
of FAR 41.201(d)(2)(i) and FAR 41.201(d)(3).

SUBCHAPTER G--CONTRACT MANAGEMENT

PART 642--CONTRACT ADMINISTRATION

    101. Subpart 642.7 is added to read as follows:

Subpart 642.7--Indirect Cost Rates


642.703  General.


642.703-2  Certificate of indirect costs.

    (b) The head of the contracting activity is the agency head's 
designee for the purpose of FAR 42.703-2(b).

PART 643--CONTRACT MODIFICATIONS

    102. Section 643.102-70 is revised by removing paragraph (b) and by 
removing the paragraph designation in paragraph (a).
    103. Section 643.104, consisting of section 643.104-70, is added to 
read as follows:


643.104  Notification of contract changes.


643.104-70  DOSAR contract clause.

    The contracting officer shall insert the clause at 652.243-70, 
Notices, in all solicitations and contracts exceeding the micro-
purchase threshold which are awarded or performed overseas.
    104. Part 644 is added to subchapter G to read as follows:

PART 644--SUBCONTRACTING POLICIES AND PROCEDURES

    Authority: 40 U.S.C. 486 (c); 22 U.S.C. 2658.

Subpart 644.3--Contractor's Purchasing System Reviews


644.302  Requirements.

    (a) The Procurement Executive is the head of the agency for the 
purpose of FAR 44.302(a).

PART 645--GOVERNMENT PROPERTY

    105. Subpart 645.4 is added to read as follows:

Subpart 645.4--Contractor Use and Rental of Government Property


645.403  Rental--Use and Charges clause.

    (a) The head of the contracting activity is the agency head's 
designee for the purpose of FAR 45.403(a).

PART 646--QUALITY ASSURANCE

    106. Part 646 is removed.

PART 647--TRANSPORTATION

    107. Subpart 647.2 is added to read as follows:

Subpart 647.2--Contracts for Transportation or for Transportation-
Related Services


647.207  Solicitation provisions, contract clauses, and special 
requirements.


647.207-7  Liability and insurance.

    (e) The Procurement Executive has approved a class deviation for 
paragraph (c) of FAR clause 52.247-23, Contractor Liability for Loss of 
and/or Damage to Household Goods. The contracting officer shall 
indicate that the contractor shall indemnify the owner of the goods at 
a rate of $5.00 per pound (or metric equivalent in local currency) 
based on the total net weight. The rate conforms with liability 
calculations found in International Through Government Bills of Lading 
(ITGBL).

PART 649--TERMINATION OF CONTRACTS

    108. Section 649.111 is removed.

SUBCHAPTER H--CLAUSES AND FORMS

PART 652--SOLICITATION PROVISIONS AND CONTRACT CLAUSES

    109. Section 652.203-70 is removed.
    110. Section 652.203-71 is removed.
    111. Section 652.204-70 is removed.
    112. Section 652.204-71 is removed.
    113. Section 652.206-70 is revised to read as follows:


652.206-70  Competition Advocacy/Ombudsman.

    As prescribed in 606.570, insert the following provision:

Competition Advocacy/Ombudsman (MO/YR)

    (a) The Department of State's Competition Advocate is 
responsible for assisting industry in removing restrictive 
requirements from Department of State solicitations and removing 
barriers to full and open competition and use of commercial items. 
If such a solicitation is considered competitively restrictive or 
does not appear properly conducive to competition and commercial 
practices, potential offerors are

[[Page 65740]]

encouraged to first contact the contracting officer for the 
respective solicitation. If concerns remain unresolved, contact the 
Department of State Competition Advocate on (703) 516-1680, by fax 
at (703) 875-6155, or write to: Department of State, Competition 
Advocate, Office of the Procurement Executive (A/OPE), Suite 603, 
SA-6, Washington, DC 20522-0602.
    (b) The Department of State's Acquisition Ombudsman has been 
appointed to hear concerns from potential offerors and contractors 
during the preaward and postaward phases of this acquisition. The 
role of the ombudsman is not to diminish the authority of the 
contracting officer, the Technical Evaluation Panel or Source 
Evaluation Board, or the selection official. The purpose of the 
ombudsman is to facilitate the communication of concerns, issues, 
disagreements, and recommendations of interested parties to the 
appropriate Government personnel, and work to resolve them. When 
requested and appropriate, the ombudsman will maintain strict 
confidentiality as to the source of the concern. The ombudsman does 
not participate in the evaluation of proposals, the source selection 
process, or the adjudication of formal contract disputes. Interested 
parties are invited to contact the contracting activity ombudsman, 
[insert name], at [insert telephone and fax numbers]. For an 
American Embassy or overseas post, refer to the numbers below for 
the Department Acquisition Ombudsman. Concerns, issues, 
disagreements, and recommendations which cannot be resolved at a 
contracting activity level may be referred to the Department of 
State Acquisition Ombudsman at (703) 516-1680, by fax at (703) 875-
6155, or write to: Department of State, Acquisition Ombudsman, 
Office of the Procurement Executive (A/OPE), Suite 603, SA-6, 
Washington, DC 20522-0602.

(End of provision)

    114. Section 652.214-70 is removed and reserved.
    115. Section 652.214-71 is revised to read as follows:


652.214-71  Authorization to Perform.

    As prescribed in 614.201-6-70(c) and 615.209-70, insert the 
following provision:

Authorization to Perform (MO/YR)

    (a) The offeror agrees, should it be selected for contract 
award, that
    (1) It has obtained (or will obtain by the date specified in the 
solicitation), authorization to operate and do business in the 
country or countries in which this contract will be performed;
    (2) It has obtained (or will obtain by the date specified in the 
solicitation), all necessary licenses and permits required to 
perform this contract; and
    (3) It shall comply fully with all laws, decrees, labor 
standards and regulations of said country or countries during the 
performance of this contract.
    (b) If the party actually performing the work will be a 
subcontractor or joint venture partner, then such subcontractor or 
joint venture partner agrees to the requirements of paragraph (a) of 
this provision.

(End of provision)

    116. Section 652.216-70 is amended by revising the introductory 
text to read as follows:


652.216-70  Ordering--Indefinite-Delivery Contract.

    As prescribed in 616.506-70, insert the following clause:
* * * * *
    117. Section 652.216-71 is revised to read as follows:


652.216-71  Price Adjustment.

    As prescribed in 616.203-4, insert a clause substantially the same 
as follows:

Price Adjustment (MO/YR)

    (a) The contract price may be increased or decreased in actual 
costs of direct service labor which result directly from laws 
enacted and effective during the term of this contract by the 
[insert name of country] Government. Direct service labor costs 
include only the costs of wages and direct benefits (such as social 
security, health insurance, unemployment compensation insurance) 
paid to or incurred for the direct benefit of personnel performing 
services under one of the categories listed in Section [identify 
section number] of this contract. Price adjustments will include 
only changes in direct service labor costs incurred in order to 
comply with the requirements of the law. No adjustment will be made 
under this clause with respect to labor costs of personnel not 
performing direct service labor under the categories of Section 
[identify section number], nor for overhead, profit, general and 
administrative (G&A) costs, taxes or any other costs whatsoever.
    (b) For the contracting officer to consider any request for 
adjustment, the contractor shall demonstrate in writing:
    (1) That the change in the law occurred during the term of this 
contract and subsequent to the award date of this contract; and,
    (2) That the change in the law could not have been reasonably 
anticipated prior to contract award; and,
    (3) How the change in the law directly affects the contractor's 
costs under this contract.
    (c) The contractor shall present data that clearly supports any 
request for adjustment. This data shall be submitted no later than 
30 calendar days after the changes in the law have been made public. 
This data shall include, but not be limited to, the following:
    (1) The calculation of the amount of adjustment requested; and,
    (2) Documentation which identifies and provides the appropriate 
portions of the text of the particular law from which the request is 
derived.
    (d) In order to establish the change between the requested 
adjusted rate and the original rate, the contractor shall support 
the appropriate data and composition of the original rate and the 
requested adjusted rate. This shall include details regarding 
specific hourly rates paid to individual employees. The allowable 
adjustment shall be limited to the extent to which increases in 
direct service labor costs due to host country law changes are not 
offset by exchange rate gains. For contracts paid in U.S. dollars, 
the contractor's request for price adjustment shall present data 
reflecting:
    (1) The exchange rate in effect on the date of the contractor's 
proposal that was accepted for the basic contract; and
    (2) The current exchange rate and its effect on payment of 
workers in local currency.
    (e) Only direct cost changes mandated by enacted laws shall be 
considered for adjustment under this contract. Changes for purposes 
of maintaining parity of pay between employees at the minimum 
mandated levels and employees already paid at levels above the newly 
mandated minimums shall not be considered. Therefore, if the 
contractor elects to increase payments to employees who are already 
being paid at or above the mandated amounts, such increased costs 
shall be borne solely by the contractor and shall not be 
justification for an increase in the hourly and monthly rates under 
this contract.
    (f) Any request for adjustment shall be presented by signature 
of an officer or general partner of the contractor having overall 
responsibility for the conduct of the contractor's affairs.
    (g) No adjustment shall be made to the contract price that 
relates to any indirect, overhead, or fixed costs, profit or fee. 
Only the changes in direct service labor wages (and any benefits 
based directly on wages) shall be considered by the U.S. Government 
as basis for contract price changes.
    (h) No request by the contractor for an adjustment under this 
clause shall be allowed if asserted after final payment has been 
made under this contract.
    (i) This clause shall only apply to laws enacted by the [insert 
name of country] Government meeting the criterion set forth in 
paragraph (b) of this clause. No adjustments shall be made due to 
currency fluctuations in exchange rates.

    (End of clause)

    118. Section 652.219-71 is added to read as follows:


652.219-71  Section 8(a) direct awards.

    As prescribed in 619.811-3(f), insert the following clause:

Section 8(a) Direct Awards (MO/YR)

    (a) This purchase order or contract is issued as a direct award 
between the contracting activity and the 8(a) contractor pursuant to 
the Memorandum of Understanding between the Small Business 
Administration (SBA) and the Department of State (DOS). SBA retains 
responsibility for 8(a) certification, 8(a) eligibility 
determinations and related issues, and provides counseling and 
assistance to the 8(a) contractor under the 8(a) program. The 
cognizant SBA district office is: [To be completed by the 
contracting officer at the time of award]
    (b) The DOS contracting officer is responsible for administering 
the purchase

[[Page 65741]]

order or contract and taking any action on behalf of the Government 
under the terms and conditions of the purchase order or contract. 
However, the DOS contracting officer shall give advance notice to 
the SBA before it issues a final notice terminating performance, 
either in whole or in part, under the purchase order or contract. 
The DOS contracting officer shall also coordinate with SBA prior to 
processing any novation agreement. The DOS contracting officer may 
assign contract administration functions to a contract 
administration office.
    (c) The contractor agrees:
    (1) To notify the DOS contracting officer, simultaneous with its 
notification to SBA (as required by SBA's 8(a) regulations), when 
the owner or owners upon whom 8(a) eligibility is based, plan to 
relinquish ownership or control of the concern. Consistent with 15 
U.S.C. 637(a)(21), transfer of ownership or control shall result in 
termination of the contract for convenience, unless SBA waives the 
requirement for termination prior to the actual relinquishing of 
ownership and control; and,
    (2) To adhere to the requirements of FAR 52.219-14, Limitations 
on Subcontracting.

(End of clause)

    119. Section 652.223-70 is removed.
    120. Section 652.223-71 is removed.
    121. Section 652.223-72 is removed.
    122. Section 652.223-73 is removed.
    123. Section 652.223-74 is removed.
    124. Section 652.223-75 is removed.
    125. Section 652.223-76 is removed.
    126. Section 652.223-77 is removed.
    127. Section 652.223-78 is removed.
    128. Section 652.225-70 is added to read as follows:


652.225-70  Arab League Boycott of Israel.

    As prescribed in 625.7002(a), insert the following provision:

Arab League Boycott of Israel (MO/YR)

    (a) Definitions. As used in this provision:
    Foreign person means any person other than a United States 
person as defined in this paragraph (a).
    United States person means any United States resident or 
national (other than an individual resident outside the United 
States and employed by other than a United States person), any 
domestic concern (including any permanent domestic establishment of 
any foreign concern), and any foreign subsidiary or affiliate 
(including any permanent foreign establishment) of any domestic 
concern which is controlled in fact by such domestic concern, as 
provided under the Export Administration Act of 1979, as amended.
    (b) Certification. By submitting this offer, the offeror 
certifies that it is not:
    (1) Taking or knowingly agreeing to take any action, with 
respect to the boycott of Israel by Arab League countries, which 
Section 8(a) of the Export Administration Act of 1979, as amended 
(50 U.S.C. 2407(a)) prohibits a United States person from taking; 
or,
    (2) Discriminating in the award of subcontracts on the basis of 
religion.

(End of provision)

    129. Section 652.225-71 is added to read as follows:


652.225-71  Section 8(a) of the Export Administration Act of 1979, as 
amended.

    As prescribed in 625.7002(b), insert the following clause:

Section 8(a) of the Export Administration Act of 1979, as Amended (MO/
YR)

    (a) Section 8(a) of the U.S. Export Administration Act of 1979, 
as amended (50 U.S.C. 2407(a)), prohibits compliance by U.S. persons 
with any boycott fostered by a foreign country against a country 
which is friendly to the United States and which is not itself the 
object of any form of boycott pursuant to United States law or 
regulation. The Boycott of Israel by Arab League countries is such a 
boycott, and therefore, the following actions, if taken with intent 
to comply with, further, or support the Arab League Boycott of 
Israel, are prohibited activities under the Export Administration 
Act:
    (1) Refusing, or requiring any U.S. person to refuse to do 
business with or in Israel, with any Israeli business concern, or 
with any national or resident of Israel, or with any other person, 
pursuant to an agreement of, or a request from or on behalf of a 
boycotting country;
    (2) Refusing, or requiring any U.S. person to refuse to employ 
or otherwise discriminating against any person on the basis of race, 
religion, sex, or national origin of that person or of any owner, 
officer, director, or employee of such person;
    (3) Furnishing information with respect to the race, religion, 
or national origin of any U.S. person or of any owner, officer, 
director, or employee of such U.S. person;
    (4) Furnishing information about whether any person has, has 
had, or proposes to have any business relationship (including a 
relationship by way of sale, purchase, legal or commercial 
representation, shipping or other transport, insurance, investment, 
or supply) with or in the State of Israel, with any business concern 
organized under the laws of the State of Israel, with any Israeli 
national or resident, or with any person which is known or believed 
to be restricted from having any business relationship with or in 
Israel;
    (5) Furnishing information about whether any person is a member 
of, has made contributions to, or is otherwise associated with or 
involved in the activities of any charitable or fraternal 
organization which supports the State of Israel; and,
    (6) Paying, honoring, confirming, or otherwise implementing a 
letter of credit which contains any condition or requirement against 
doing business with the State of Israel.
    (b) Under Section 8(a), the following types of activities are 
not forbidden ``compliance with the boycott,'' and are therefore 
exempted from Section 8(a)'s prohibitions listed in paragraphs (a) 
(1) through (6) of this clause:
    (1) Complying or agreeing to comply with requirements:
    (i) Prohibiting the import of goods or services from Israel or 
goods produced or services provided by any business concern 
organized under the laws of Israel or by nationals or residents of 
Israel; or,
    (ii) Prohibiting the shipment of goods to Israel on a carrier of 
Israel, or by a route other than that prescribed by the boycotting 
country or the recipient of the shipment;
    (2) Complying or agreeing to comply with import and shipping 
document requirements with respect to the country of origin, the 
name of the carrier and route of shipment, the name of the supplier 
of the shipment or the name of the provider of other services, 
except that no information knowingly furnished or conveyed in 
response to such requirements may be stated in negative, 
blacklisting, or similar exclusionary terms, other than with respect 
to carriers or route of shipments as may be permitted by such 
regulations in order to comply with precautionary requirements 
protecting against war risks and confiscation;
    (3) Complying or agreeing to comply in the normal course of 
business with the unilateral and specific selection by a boycotting 
country, or national or resident thereof, of carriers, insurance, 
suppliers of services to be performed within the boycotting country 
or specific goods which, in the normal course of business, are 
identifiable by source when imported into the boycotting country;
    (4) Complying or agreeing to comply with the export requirements 
of the boycotting country relating to shipments or transshipments of 
exports to Israel, to any business concern of or organized under the 
laws of Israel, or to any national or resident of Israel;
    (5) Compliance by an individual or agreement by an individual to 
comply with the immigration or passport requirements of any country 
with respect to such individual or any member of such individual's 
family or with requests for information regarding requirements of 
employment of such individual within the boycotting country; and,
    (6) Compliance by a U.S. person resident in a foreign country or 
agreement by such person to comply with the laws of that country 
with respect to his or her activities exclusively therein, and such 
regulations may contain exceptions for such resident complying with 
the laws or regulations of that foreign country governing imports 
into such country of trademarked, trade named, or similarly 
specifically identifiable products, or components of products for 
his or her own use, including the performance of contractual 
services within that country, as may be defined by such regulations.

(End of clause)

    130. Section 652.226-70 is added to read as follows:


652.226-70  Certification of status as a minority business enterprise.

    As prescribed in 626.200-70, insert the following provision:

Certification of Status as a Minority Business Enterprise (MO/YR)

    The Bidder/Offeror/Supplier certifies that is [ ] is [ ] is not 
[check one] a minority

[[Page 65742]]

business enterprise which is defined as a business which is at least 
51 percent owned by one or more minority individuals or, in the case 
of a publicly owned business, at least 51 percent of its voting 
stock is owned by one or more minority individuals, and whose 
management and daily operations are controlled by one or more such 
individuals. For purposes of this definition, minority individuals 
are:
    [Check the applicable block]
    [ ] Black Americans
    [ ] Hispanic Americans
    [ ] Native Americans
    [ ] Asian-Pacific Americans
    [ ] Other groups whose members are U.S. citizens and are found 
to be disadvantaged by the Small Business Administration pursuant to 
Section 8(d) of the Small Business Act, as amended (15 U.S.C. 
637(d)), or the Secretary of Commerce.

(End of provision)

    Alternate I (MO/YR).
    Certification of Status as a Minority Business Enterprise 
(Alternate I) (MO/YR)
    (a) If you are a minority-owned business, please indicate in the 
comments section of your quote/response the applicable minority 
designation from those listed in paragraph (b) of this provision. If 
no comments are received, it shall be assumed that you are not a 
minority-owned business. This request for information is to assist 
the Department collect statistics on awards to minority-owned 
businesses and will not influence the award decision.
    (b) A minority business enterprise is defined as a business 
which is at least 51 percent owned by one or more minority 
individuals or, in the case of a publicly owned business, at least 
51 percent of its voting stock is owned by one or more minority 
individuals, and whose management and daily operations are 
controlled by one or more such individuals. For purposes of this 
definition, minority individuals are: Black Americans; Hispanic 
Americans; Native Americans; Asian-Pacific Americans; and, other 
groups whose members are U.S. citizens and are found to be 
disadvantaged by the Small Business Administration pursuant to 
Section 8(d) of the Small Business Act, as amended (15 U.S.C. 
637(d)), or the Secretary of Commerce.

(End of provision)

    131. Section 652.228-70 is amended by revising the introductory 
text to read as follows:


652.228-70  Indemnification.

    As prescribed in 628.7001(b), insert the following clause:
* * * * *
    132. Section 652.228-71 is revised to read as follows:


652.228-71  Worker's Compensation Insurance (Defense Base Act)--
Services

    As prescribed in 628.305(b), insert the following clause:

Worker's Compensation Insurance (Defense Base Act)--Services (MO/YR)

    (a) This clause supplements FAR 52.228-3.
    (b) The contractor agrees to procure Defense Base Act (DBA) 
insurance pursuant to the terms of the contract between the 
Department of State and the Department's DBA insurance carrier 
unless the contractor has a DBA self-insurance program approved by 
the Department of Labor. The contractor shall submit a copy of the 
Department of Labor's approval to the contracting officer upon 
contract award. The current rate under the Department of State 
contract is [contracting officer insert rate] of compensation for 
services.
    (c) Since the Department of State has obtained a waiver of DBA 
coverage for contractor employees who are not citizens of, residents 
of, or hired in the United States, the contractor agrees to provide 
such employees with worker's compensation benefits as required by 
the laws of the country in which the employees are working, or by 
the laws of the employee's native country, whichever offers greater 
benefits.
    (d) The contractor agrees to insert a clause substantially the 
same as this one in all subcontracts to which the DBA is applicable. 
Subcontractors shall be required to insert a similar clause in any 
of their subcontracts subject to the DBA.
    (e) Should the rates for DBA insurance coverage increase or 
decrease during the performance of this contract, the Department 
shall modify this contract accordingly.
    (f) The contractor shall demonstrate to the satisfaction of the 
contracting officer that the equitable adjustment as a result of the 
insurance increase or decrease does not include any reserve for such 
insurance. Adjustment shall not include any overhead, profit, 
general and administrative expenses, etc.

(End of clause)

    Alternate I (MO/YR). If the contract is for construction, as 
prescribed in 628.305(b), substitute the last sentence of paragraph 
(b) to read as follows: ``The current rate under the Department of 
State contract is [contracting officer insert rate] of compensation 
for construction.''

    133. Section 652.228-72 is removed and reserved.
    134. Section 652.228-73 is removed and reserved.
    135. Section 652.228-74 is revised to read as follows:


652.228-74  Defense Base Act insurance rates--Limitation--Fixed-price.

    As prescribed in 628.306, insert the following provision:

Defense Base Act Insurance Rates--Limitation--Fixed-Price (MO/YR)

    (a) The Department of State has entered into a contract with an 
insurance carrier to provide DBA insurance to Department of State 
contractors at a contracted rate. The rates for this insurance are 
as follows:
    Services @ [contracting officer insert current rate] of 
compensation; or Construction @ [contracting officer insert current 
rate] of compensation.
    (b) Bidders/Offerors should compute the total compensation 
(direct salary plus differential, but excluding per diem, housing 
allowance and other miscellaneous post allowances) to be paid to 
employees who will be covered by DBA insurance and the cost of DBA 
insurance in their bid/proposal using the foregoing rate, and insert 
the totals in the spaces provided for the base year and each year 
thereafter, if applicable. The DBA insurance cost shall be included 
in the total fixed price. The DBA insurance costs shall be 
reimbursed directly to the contractor.
(1) Compensation of Covered Employees:---------------------------------
(2) Defense Base Act Insurance Costs:----------------------------------
(3) Total Cost:--------------------------------------------------------
    (c) Bidders/offerors shall include a statement as to whether or 
not local nationals or third country nationals will be employed on 
the resultant contract.

(End of provision)

    136. Section 652.228-75 is removed and reserved.
    137. Section 652.228-76 is revised to read as follows:


652.228-76  Defense Base Act insurance rates--Limitation--Cost-
reimbursement, labor-hour, and time-and-materials.

    As prescribed in 628.307, insert the following provision:

Defense Base Act Insurance Rates--Limitation--Cost-Reimbursement, 
Labor-Hour, and Time-and-Materials (MO/YR)

    (a) The Department of State has entered into a contract with an 
insurance carrier to provide DBA insurance to Department of State 
contractors at a contracted rate. In preparing the cost proposal, 
the offeror shall use the following rates in computing the cost for 
DBA insurance:
    Services @ [contracting officer insert current rate] of 
compensation (direct salary plus differential, but excluding per 
diem, housing allowance, education allowance, and miscellaneous 
allowances); or
    Construction @ [contracting officer insert current rate] of 
compensation.
    (b) These rates apply to all job classifications in those 
particular categories. The successful offeror shall be advised of 
the name and address of the insurance broker who will process the 
DBA insurance coverage.
    (c) Should an offeror compute or include higher DBA insurance 
rates, the rates shall be disallowed.
    (d) Offerors shall include a statement as to whether or not 
local nationals or third country nationals will be employed on the 
resultant contract.

(End of provision)

    138. Section 652.228-77 is removed.
    139. Section 652.229-70 is amended by revising the introdcutorty 
text to read as follows:


652.229-70  Excise tax exemption statement for contractors within the 
United States.

    As prescribed in 629.401-70, insert the following clause:
* * * * *
    140. Section 652.229-71 is added to read as follows:

[[Page 65743]]

652.229-71  Personal property disposition at posts abroad.

    As prescribed in 629.402-1-70, insert the following clause:

Personal Property Disposition at Posts Abroad (MO/YR)

    Regulations at 22 CFR Part 136 require that U.S. Government 
employees and their families do not profit personally from sales or 
other transactions with persons who are not themselves entitled to 
exemption from import restrictions, duties, or taxes. Should the 
contractor experience importation or tax privileges in a foreign 
country because of its contractual relationship to the United States 
Government, the contractor shall observe the requirements of 22 CFR 
Part 136 and all policies, rules, and procedures issued by the chief 
of mission in that foreign country.

(End of clause)

    141. Section 652.232-70 is amended in paragraph (c) of the clause 
by revising the first sentence to read as follows:


652.232-70  Payment Schedule and Invoice Submission--(Fixed-Price).

* * * * *

Payment Schedule and Invoice Submission (Fixed-Price) (MO/YR)

* * * * *
    (c) Invoice Submission. Invoices shall be submitted in an 
original and [contracting officer insert appropriate number of 
copies] to the office identified in Block 10 of the SF-26, Block 23 
of the SF-33, or Block 18b of the SF-1449. * * *
* * * * *
    142. Section 652.232-71 is amended in paragraph (a) by revising the 
last sentence to read as follows:


652.232-71  Voucher Submission (Cost-Reimbursement).

* * * * *

Voucher Submission (Cost-Reimbursement) (MO/YR)

    (a) * * * All vouchers shall be submitted to the office 
identified in Block 10 of the SF-26, Block 23 of the SF-33, or Block 
18b of the SF-1449.
* * * * *
    143. Section 652.232-72 is added to read as follows:


652.232-72  Limitation of funds.

    As prescribed in 632.705-70, insert the following clause:

Limitation of Funds (MO/YR)

    (a) Of the total price in Section B (or the ``Prices'' section), 
only the amount stated on the contract award document or subsequent 
modifications is now available for payment and obligated under this 
contract. It is anticipated that from time to time, additional funds 
will be obligated under the contract until the total price of the 
contract is obligated.
    (b) The Government is not obligated to pay or reimburse the 
contractor more than the amount obligated pursuant to this clause. 
The contractor agrees to perform the contract up to the point at 
which the total amount paid and payable by the Government (including 
amounts payable for subcontracts and settlement costs if this 
contract is terminated for convenience) approximates but does not 
exceed the total amount obligated.
    (c)(1) It is contemplated that funds now obligated under this 
contract will cover the work to be performed until [contracting 
officer insert date].
    (2) If the contractor considers the funds obligated under this 
contract to be insufficient to cover the work to be performed until 
that date, or another date agreed to by the parties, the contractor 
shall notify the contracting officer in writing and indicate the 
date on which it expects expended funds to approximate 75 percent of 
the total amount obligated. The notice shall state the estimated 
amount of additional funds required to continue performance through 
the date specified in paragraph (c)(1) of this clause or another 
date agreed to by the parties.
    (3) If, after notification is provided pursuant to paragraph 
(c)(2) of this clause, additional funds are not obligated, or an 
earlier date than the date in paragraph (c)(1) of this clause is not 
agreed to, the contractor shall not be obligated to continue 
performance under this contract (including actions under the 
termination clause of this contract) beyond the funds obligated for 
contract performance.
    (d) When additional funds are obligated from time to time for 
continued performance of this contract, the contract shall be 
modified to increase the funds obligated and to indicate the period 
of performance for which funds are applicable. The contractor may 
notify the contracting officer as provided in paragraph (c)(2) of 
this clause regarding any additional funds obligated.
    (e) If the contractor incurs additional costs or is delayed in 
the performance of work under this contract, solely by reason of the 
Government's failure to obligate additional funds in amounts 
sufficient for the timely performance of this contract, an equitable 
adjustment may be made to the price, or time of delivery, or both.
    (f) This clause shall become inoperative upon obligation of 
funds sufficient to cover the full price stated in the contract, 
except for rights and obligations then existing under this clause.
    (g) Nothing in this clause shall affect the Government's right 
to terminate the contract for convenience or default.

(End of clause)

    144. Section 652.236-70 is added to read as follows:


652.236-70  Accident prevention.

    As prescribed in 636.513, insert the following clause:

Accident Prevention (MO/YR)

    (a) General. The contractor shall provide and maintain work 
environments and procedures which will safeguard the public and 
Government personnel, property, materials, supplies, and equipment 
exposed to contractor operations and activities; avoid interruptions 
of Government operations and delays in project completion dates; 
and, control costs in the performance of this contract. For these 
purposes, the contractor shall:
    (1) Provide appropriate safety barricades, signs and signal 
lights;
    (2) Comply with the standards issued by any local government 
authority having jurisdiction over occupational health and safety 
issues; and,
    (3) Ensure that any additional measures the contracting officer 
determines to be reasonably necessary for this purpose are taken.
    (4) [The contracting officer shall specify additional 
requirements regarding safety if the work involves scaffolding or 
other work at heights above 2 meters, trenches or other excavation 
greater than 1 meter, earth moving equipment, electrical hazards, 
work in confined spaces (limited exits, potential for oxygen less 
than 19.5%, toxic or combustible atmosphere, potential for solid or 
liquid engulfment, or other hazards considered to be immediately 
dangerous to life or health such as water tanks, transformer vaults, 
sewers, cisterns, etc.), or hazardous materials (especially those 
used indoors, e.g., paints, solvents, etc.).]
    (b) Records. The contractor shall maintain an accurate record of 
exposure data on all accidents incident to work performed under this 
contract resulting in death, traumatic injury, occupational disease, 
or damage to or theft of property, materials, supplies, or 
equipment. The contractor shall report this data in the manner 
prescribed by the contracting officer.
    (c) Subcontracts. The contractor shall be responsible for its 
subcontractors' compliance with this clause.
    (d) Written program. Before commencing work, the contractor 
shall:
    (1) Submit a written plan for implementing this clause; and,
    (2) Meet with the contracting officer to discuss and develop a 
mutual understanding relative to administration of the overall 
safety program.
    (e) Notification. The contracting officer shall notify the 
contractor of any non-compliance with these requirements and the 
corrective actions required. This notice, when delivered to the 
contractor or the contractor's representative on site, shall be 
deemed sufficient notice of the non-compliance and corrective action 
required. After receiving the notice, the contractor shall 
immediately take corrective action. If the contractor fails or 
refuses to promptly take corrective action, the contracting officer 
may issue an order suspending all or part of the work until 
satisfactory corrective action has been taken. The contractor shall 
not be entitled to any equitable adjustment of the contract price or 
extension of the performance schedule on any suspension of work 
order issued under this clause.

(End of clause)

    145. Section 652.237-71 is amended by revising the clause date to 
``(MO/YR)''; and, in paragraph (c) of the clause by removing the words 
``Building Pass

[[Page 65744]]

Application Unit, Room 309, State Annex Number 1, Columbia Plaza., 
22401 E Street, NW, Washington, DC'' and inserting the words ``Building 
Pass Application Unit, Room B266, Department of State, 2201 C Street, 
NW, Washington, DC'' in their place.
    146. Section 652.237-72 is amended by revising the clause date to 
``(MO/YR)''; and, in paragraph (a) of the clause by removing the words 
``President's Day'' from the list of designated holidays and inserting 
the words ``Washington's Birthday'' in their place.
    147. Section 652.242-70 is amended by revising the clause date to 
``(MO/YR)''; and by deleting the parenthetical ``[insert name of COR]'' 
in paragraph (b) of the clause and inserting the words ``[insert job 
title of COR]'' in their place.
    148. Section 652.242-71 is amended by revising the introductory 
text to read as follows:


652.242-71  Notice of Shipments.

    As prescribed in 642.1406-2-70(a), insert the following clause:
* * * * *
    149. Section 652.242-72 is amended by revising the introductory 
text to read as follows:


652.242-71  Shipping Instructions.

    As prescribed in 642.1406-2-70(b), insert the following clause:
* * * * *
    150. Section 652.243-70 is added to read as follows:


652.243-70  Notices.

    As prescribed in 643.104-70, insert the following clause:

Notices (MO/YR)

    Any notice or request relating to this contract given by either 
party to the other shall be in writing. Said notice or request shall 
be mailed or delivered by hand to the other party at the address 
provided in the schedule of the contract. All modifications to the 
contract must be made in writing by the contracting officer.

(End of clause)

    151. Section 652.246-70 is removed.

PART 653--FORMS

    152. Section 653.213-70 is removed.
    153. Section 653.219 is amended by revising the section heading to 
read as follows:


653.219  Small business programs.

    154. Section 653.219-70 is revised to read as follows:


653.219-70  DOS form DS-1910, Small Business Agency Review--Actions 
Above the Simplified Acquisition Threshold.

    As prescribed in 619.501(c), DS-1910 is prescribed for use in 
documenting set-aside decisions.

    Dated: November 16, 1998.
Lloyd W. Pratsch,
Procurement Executive.
[FR Doc. 98-31430 Filed 11-27-98; 8:45 am]
BILLING CODE 4710-05-P