[Federal Register Volume 64, Number 185 (Friday, September 24, 1999)]
[Rules and Regulations]
[Pages 51830-51832]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-24411]
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DEPARTMENT OF DEFENSE
GENERAL SERVICES ADMINISTRATION
NATIONAL AERONAUTICS AND SPACE ADMINISTRATION
48 CFR Parts 5, 6, 7, 8, 12, 13, 14, 15, 19, 26, 52, and 53
[FAC 97-14; FAR Case 97-307; Item II]
RIN 9000-AI20
Federal Acquisition Regulation; Historically Underutilized
Business Zone (HUBZone) Empowerment Contracting Program
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 (Councils) have agreed to adopt the
interim rule published in the Federal Register as Item I of Federal
Acquisition Circular 97-10 at 63 FR 70265, December 18, 1998, and the
correcting amendment published at 64 FR 3196, January 20, 1999, as a
final rule with changes. The rule amends the Federal Acquisition
Regulation (FAR) to implement revisions made to Small Business
Administration (SBA) regulations covering the Historically
Underutilized Business Zone (HUBZone) Program.
EFFECTIVE DATE: November 23, 1999.
[[Page 51831]]
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. Victoria Moss, Procurement Analyst, at (202) 501-
4764. Please cite FAC 97-14, FAR case 97-307.
SUPPLEMENTARY INFORMATION:
A. Background
DoD, GSA, and NASA published an interim rule in the Federal
Register at 63 FR 70265, December 18, 1998, and a correcting amendment
at 64 FR 3196, January 20, 1999. This final rule amends FAR Parts 6,
19, and 52 to comply with revisions made to the SBA's HUBZone Program
contained in 13 CFR Parts 121, 125, and 126 (63 FR 31896, June 11,
1998), and to make editorial revisions. The purpose of the HUBZone
Program is to provide Federal contracting assistance for qualified
small business concerns located in distressed communities in an effort
to increase employment opportunities, investment, and economic
development in these communities. The program provides for set-asides
for firms that meet the definition of a HUBZone small business concern
(SBC), sole source awards to HUBZone SBCs, and price evaluation
preferences for HUBZone SBCs in acquisitions conducted using full and
open competition, and establishes a Governmentwide goal for HUBZone
awards. Until September 30, 2000, ten Government agencies are required
to comply with the prime contract HUBZone Program. After that date, the
program will apply to all Federal agencies employing one or more
contracting officers.
Seven respondents submitted comments in response to the interim
rule. The Councils considered all comments in the development of the
final rule.
This rule was subject to Office of Management and Budget review
under Section 6(b) of Executive Order 12866, Regulatory Planning and
Review, dated September 30, 1993. This rule is a major rule under 5
U.S.C. 804.
B. Regulatory Flexibility Act
The Regulatory Flexibility Act, 5 U.S.C. 601 et seq., applies to
this final rule. Therefore, the Councils completed a Final Regulatory
Flexibility Analysis (FRFA). Interested parties may obtain a copy of
the FRFA from the FAR Secretariat. It is summarized as follows:
The purpose of the HUBZone Program is to provide Federal
contracting assistance for qualified small business concerns (SBCs)
located in historically underutilized business zones in an effort to
increase employment opportunities, investment, and economic
development in such areas. The HUBZone Program will benefit SBCs by
increasing the number of Federal Government contracts awarded to
them. There is a statutory goal for HUBZone SBCs to receive 3
percent of contract dollars by fiscal year 2003. The HUBZone Act of
1997, Title VI of Public Law 105-135, 111 Stat. 2592 (December 2,
1997), created the HUBZone Program and directed the Administrator of
the Small Business Administration to promulgate implementing
regulations. On June 11, 1998, the SBA issued a final rule setting
forth the program requirements for qualification as a HUBZone SBC,
the Federal contracting assistance available to qualified HUBZone
SBCs, and other aspects of this program. This Federal Acquisition
Regulation (FAR) rule further implements the SBA rule. There were no
public comments received in response to the Initial Regulatory
Flexibility Analysis. The small entities affected by this rule are
those who fit within the definition of a small business concern as
defined by SBA in 13 CFR Part 121 and new Part 126 and who
participate in Government contracting. Because the program is new,
we cannot estimate precisely the number or classes of small entities
that this rule will affect. However, SBA estimates that more than
30,000 SBCs will apply for certification as qualified HUBZone SBCs.
These 30,000 HUBZone SBCs will be spread over about 7,000 census
tracts, about 900 non-metropolitan counties, 310 Indian
reservations, and 217 Alaska Native villages. With respect to
projected reporting and recordkeeping requirements, this FAR rule
requires that Government prime contractors with contracts that
require subcontracting plans to seek out HUBZone SBCs as
subcontractors, as well as to maintain records and report on those
subcontracts awarded to HUBZone SBCs. These requirements do not
apply to small businesses. We selected alternatives that would
minimize any adverse economic impact on small business. In general,
we modeled the rule's procurement mechanisms, to the extent
permitted by the SBA rule, on those already in use within the
Government. This approach should make the requirements of the rules
immediately familiar to many small businesses that already have
extensive experience in dealing with Government contracting offices.
Moreover, we structured each individual mechanism to strike an
appropriate balance between the interests of HUBZone and non-HUBZone
small businesses, and to minimize the overall burden of compliance
on small business. For example, we did not make the price evaluation
adjustment applicable to all competitive procurements, but rather
only to acquisitions that are not reserved or set aside for small
business concerns, or where a small business would not be displaced.
C. Paperwork Reduction Act
The Paperwork Reduction Act (Pub. L. 104-13) applies because the
final rule contains information collection requirements currently
approved under OMB Control Numbers 9000-0006 and 9000-0007.
List of Subjects in 48 CFR Parts 5, 6, 7, 8, 12, 13, 14, 15, 19,
26, 52, and 53
Government procurement.
Dated: September 14, 1999.
Edward C. Loeb,
Director, Federal Acquisition Policy Division.
Interim Rule Adopted as Final With Changes
Accordingly, DoD, GSA, and NASA adopt the interim rule amending 48
CFR parts 5, 6, 7, 8, 12, 13, 14, 15, 19, 26, 52, and 53 that was
published at 63 FR 70265, December 18, 1998, and the correcting
amendment published at 64 FR 3196, January 20, 1999, as a final rule
with the following changes:
1. The authority citation for 48 CFR parts 6, 19, and 52, 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).
PART 6--COMPETITION REQUIREMENTS
2. Revise section 6.201 to read as follows:
6.201 Policy.
Acquisitions made under this subpart require use of the competitive
procedures prescribed in 6.102.
PART 19--SMALL BUSINESS PROGRAMS
3. Amend section 19.306 to revise paragraphs (c), (e), and (k) to
read as follows:
19.306 Protesting a firm's status as a HUBZone small business
concern.
* * * * *
(c) All protests must be in writing and must state all specific
grounds for the protest. Assertions that a protested concern is not a
qualified HUBZone small business concern, without setting forth
specific facts or allegations, are insufficient. An offeror must submit
its protest to the contracting officer. The contracting officer and the
SBA must submit protests to SBA's Associate Administrator for the
HUBZone Program (AA/HUB).
* * * * *
(e) Except for premature protests, the contracting officer must
forward any protest received, notwithstanding whether the contracting
officer believes that the protest is insufficiently specific or
untimely, to: AA/HUB, U.S. Small Business Administration, 409 3rd
Street, SW, Washington, DC 20416. The AA/HUB will notify the protester
and the contracting officer of the date the protest was received and
whether the protest
[[Page 51832]]
will be processed or dismissed for lack of timeliness or specificity.
* * * * *
(k) The ADA/GC&8(a)BD will make its decision within 5 business days
of the receipt of the appeal, if practicable, and will base its
decision only on the information and documentation in the protest
record as supplemented by the appeal. SBA will provide a copy of the
decision to the contracting officer, the protester, and the protested
HUBZone small business concern. The SBA decision, if received before
award, will apply to the pending acquisition. SBA rulings received
after award will not apply to that acquisition. The ADA/GC&8(a)BD's
decision is the final decision.
4. Revise section 19.307 to read as follows:
19.307 Solicitation provisions.
(a)(1) Insert the provision at 52.219-1, Small Business Program
Representations, in solicitations exceeding the micro-purchase
threshold when the contractor will perform the contract inside the
United States, its territories or possessions, Puerto Rico, the Trust
Territory of the Pacific Islands, or the District of Columbia.
(2)(i) Use the provision with its Alternate I in solicitations
issued by the following agencies on or before September 30, 2000:
(A) Department of Agriculture.
(B) Department of Defense.
(C) Department of Energy.
(D) Department of Health and Human Services.
(E) Department of Housing and Urban Development.
(F) Department of Transportation.
(G) Department of Veterans Affairs.
(H) Environmental Protection Agency.
(I) General Services Administration.
(J) National Aeronautics and Space Administration.
(ii) Use the provision with its Alternate I in solicitations issued
by all Federal agencies after September 30, 2000.
(3) Use the provision with its Alternate II in solicitations issued
by DoD, NASA, or the Coast Guard that the contracting officer expects
will exceed the threshold at 4.601(a).
(b) Insert the provision at 52.219-22, Small Disadvantaged Business
Status, in solicitations that include the clause at 52.219-23, Notice
of Price Evaluation Adjustment for Small Disadvantaged Business
Concerns, or 52.219-25, Small Disadvantaged Business Participation
Program--Disadvantaged Status and Reporting. Use the provision with its
Alternate I in solicitations for acquisitions for which a price
evaluation adjustment for small disadvantaged business concerns is
authorized on a regional basis.
(c) When contracting by sealed bidding, insert the provision at
52.219-2, Equal Low Bids, in solicitations and contracts when the
contractor will perform the contract inside the United States, its
territories or possessions, Puerto Rico, the Trust Territory of the
Pacific Islands, or the District of Columbia.
5. Amend section 19.800 to revise paragraph (e) to read as follows:
19.800 General.
* * * * *
(e) Before deciding to set aside an acquisition in accordance with
Subpart 19.5 or 19.13, the contracting officer should review the
acquisition for offering under the 8(a) Program. If the acquisition is
offered to the SBA, SBA regulations (13 CFR 126.607(b)) give first
priority to HUBZone 8(a) concerns.
* * * * *
6. Amend section 19.1303 to revise paragraph (b) to read as
follows:
19.1303 Status as a qualified HUBZone small business concern.
* * * * *
(b) If the SBA determines that a concern is a qualified HUBZone
small business concern, it will issue a certification to that effect
and will add the concern to the List of Qualified HUBZone Small
Business Concerns on its Internet website at http://www.sba.gov/
hubzone. A firm on the list is eligible for HUBZone program preferences
without regard to the place of performance. The concern must appear on
the list to be a HUBZone small business concern.
* * * * *
PART 52--SOLICITATION PROVISIONS AND CONTRACT CLAUSES
7. Amend section 52.219-1 to revise Alternates I and II to read as
follows:
52.219-1 Small Business Program Representations.
* * * * *
Alternate I (Nov 1999). As prescribed in 19.307(a)(2), add the
following paragraph (b)(4) to the basic provision:
(4) [Complete only if offeror represented itself as a small
business concern in paragraph (b)(1) of this provision.] The offeror
represents, as part of its offer, that--
(i) It____is, ____is not a HUBZone small business concern
listed, on the date of this representation, on the List of Qualified
HUBZone Small Business Concerns maintained by the Small Business
Administration, and no material change in ownership and control,
principal office, or HUBZone employee percentage has occurred since
it was certified by the Small Business Administration in accordance
with 13 CFR Part 126; and
(ii) It ____ is, ____ is not a joint venture that complies with
the requirements of 13 CFR Part 126, and the representation in
paragraph (b)(4)(i) of this provision is accurate for the HUBZone
small business concern or concerns that are participating in the
joint venture. [The offeror shall enter the name or names of the
HUBZone small business concern or concerns that are participating in
the joint venture: ____________.] Each HUBZone small business
concern participating in the joint venture shall submit a separate
signed copy of the HUBZone representation.
Alternate II (Nov 1999). As prescribed in 19.307(a)(3), add the
following paragraph (b)(5) to the basic provision:
(5) [Complete if offeror represented itself as disadvantaged in
paragraph (b)(2) of this provision.] The offeror shall check the
category in which its ownership falls:
____ Black American.
____ Hispanic American.
____ Native American (American Indians, Eskimos, Aleuts, or
Native Hawaiians).
____ Asian-Pacific American (persons with origins from Burma,
Thailand, Malaysia, Indonesia, Singapore, Brunei, Japan, China,
Taiwan, Laos, Cambodia (Kampuchea), Vietnam, Korea, The Philippines,
U.S. Trust Territory of the Pacific Islands (Republic of Palau),
Republic of the Marshall Islands, Federated States of Micronesia,
the Commonwealth of the Northern Mariana Islands, Guam, Samoa,
Macao, Hong Kong, Fiji, Tonga, Kiribati, Tuvalu, or Nauru).
____ Subcontinent Asian (Asian-Indian) American (persons with
origins from India, Pakistan, Bangladesh, Sri Lanka, Bhutan, the
Maldives Islands, or Nepal).
____ Individual/concern, other than one of the preceding.
[FR Doc. 99-24411 Filed 9-23-99; 8:45 am]
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