[Federal Register Volume 64, Number 42 (Thursday, March 4, 1999)]
[Rules and Regulations]
[Page 10547]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-5209]



[[Page 10547]]

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DEPARTMENT OF DEFENSE

GENERAL SERVICES ADMINISTRATION


NATIONAL AERONAUTICS AND SPACE ADMINISTRATION

48 CFR Part 31

[FAC 97-11; FAR Case 98-001; Item VII]
RIN 9000-AI06

Federal Acquisition Regulation; Recruitment Costs Principle

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

ACTION: Final rule.

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SUMMARY: The Civilian Agency Acquisition Council and the Defense 
Acquisition Regulations Council have agreed on a final rule amending 
the Federal Acquisition Regulation (FAR) to revise the ``recruitment 
costs'' and the ``public relations and advertising cost'' cost 
principles for streamlining purposes.

EFFECTIVE DATE: May 3, 1999.

FOR FURTHER INFORMATION CONTACT: The FAR Secretariat, Room 4035, GS 
Building, Washington, DC, 20405, (202) 501-4755, for information 
pertaining to status or publication schedules. For clarification of 
content, contact Ms. Linda Nelson, Procurement Analyst, at (202) 501-
1900. Please cite FAC 97-11, FAR case 98-001.

SUPPLEMENTARY INFORMATION:

A. Background

    A proposed FAR rule was published in the Federal Register on August 
12, 1998 (63 FR 43238). The final rule differs from the proposed rule 
by deleting the following phrase from FAR 31.205-34(a): ``and provided 
that the size of the staff recruited and maintained is in keeping with 
the workload requirements.'' This phrase is unnecessary as the 
criteria, including reasonableness, discussed in FAR part 31 are 
sufficient to govern the acceptability of this type of cost.
    Public comments were received from six sources. All comments were 
considered in developing the final rule.
    This regulatory action was not subject to Office of Management and 
Budget review under Executive Order 12866, dated September 30, 1993, 
and is not a major rule under 5 U.S.C. 804.

B. Regulatory Flexibility Act

    The Department of Defense, the General Services Administration, and 
the National Aeronautics and Space Administration certify that this 
final rule will not have a significant economic impact on a substantial 
number of small entities within the meaning of the Regulatory 
Flexibility Act, 5 U.S.C. 601, et seq., because most contracts awarded 
to small entities use simplified acquisition procedures or are awarded 
on a competitive, fixed-price basis, and do not require application of 
the cost principles contained in this rule.

C. Paperwork Reduction Act

    The Paperwork Reduction Act does not apply because the changes to 
the FAR do not impose information collection requirements that require 
the approval of the Office of Management and Budget under 44 U.S.C. 
3501, et seq.

List of Subjects in 48 CFR Part 31

    Government procurement.

    Dated: February 25, 1999.
Edward C. Loeb,
Director, Federal Acquisition Policy Division.

    Therefore, 48 CFR Part 31 is amended as set forth below:

PART 31--CONTRACT COST PRINCIPLES AND PROCEDURES

    1. The authority citation for 48 CFR Part 31 continues to read as 
follows:

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

    2. Section 31.205-1 is amended by revising paragraph (d) to read as 
follows:


31.205-1  Public relations and advertising costs.

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


31.205-34  Recruitment costs.

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

[FR Doc. 99-5209 Filed 3-3-99; 8:45 am]
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