[Federal Register Volume 65, Number 115 (Wednesday, June 14, 2000)]
[Rules and Regulations]
[Pages 37289-37292]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 00-14635]


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ENVIRONMENTAL PROTECTION AGENCY

48 CFR Parts 1501, 1509, 1532 and 1552

[FRL-6712-2]


Acquisition Regulation

AGENCY: Environmental Protection Agency.

ACTION: Direct final rule.

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SUMMARY: The Environmental Protection Agency (EPA) is issuing this rule 
to amend Agency administrative procedures related to the: processing of 
individual FAR deviations, redelegation of Agency contract ratification 
authority, debarment, suspension and ineligibility of contractors, and 
reduction or suspension of contract payments upon finding of fraud.

DATES: This rule is effective on September 12, 2000 without further 
notice, unless EPA receives adverse comments by July 14, 2000. If we 
receive adverse comments, we will, before the rule's effective date, 
publish a timely withdrawal in the Federal Register informing the 
public that this rule will not take effect.

ADDRESSES: Adverse comments may be submitted to Larry Wyborski, US 
Environmental Protection Agency, Office of Acquisition Management 
(3802R), 1200 Pennsylvania Avenue, NW., Washington, DC 20460 or 
electronically at: [email protected]

FOR FURTHER INFORMATION CONTACT: Larry Wyborski, U.S. Environmental 
Protection Agency, Office of Acquisition Management (3802R), 1200 
Pennsylvania Avenue, NW., Washington, DC 20460, (202) 564-4369, 
[email protected]

SUPPLEMENTARY INFORMATION:   

A. Background Information

    This rule revises Subpart 1501.4 to delete a requirement that the 
Head of the Contracting Activity (HCA) furnish copies of individual 
Federal Acquisition Regulation (FAR) deviations to the FAR Secretariat, 
consistent with a prior change to the FAR.
    Subpart 1501.6 is revised to clarify how contract ratification 
authority is authorized in the absence of the duly authorized ratifying 
official.
    Subpart 1509.4 is updated for consistency with: (1) The Federal 
Acquisition Regulation and (2) an Agency Memorandum of Understanding on 
the respective roles of the EPA offices involved in processing actions 
for debarment or suspension of contractors.
    In addition, Federal Acquisition Regulation 32.006 references 
Agency procedures for reducing or suspending contractor payments based 
on a finding of fraud and EPAAR 1532.006 is being added to set forth 
Agency procedures for reducing or suspending contractor payments based 
on a finding of fraud.

B. Executive Order 12866

    This is not a significant regulatory action for purposes of 
Executive Order 12866; therefore, no review is required at the Office 
of Information and Regulatory Affairs, within the Office of Management 
and Budget (OMB).

C. Paperwork Reduction Act

    The Paperwork Reduction Act does not apply because this rule does 
not contain information collection requirements for the approval of OMB 
under the Paperwork Reduction Act of 1980 (44 U.S.C. 3501, et seq.)

D. Regulatory Flexibility Act (RFA), as Amended by the Small 
Business Regulatory Enforcement Fairness Act of 1996 (SBREFA), 5 
U.S.C. 601 et seq.

    The RFA generally requires an agency to prepare a regulatory 
flexibility analysis of any rule subject to notice and comment 
rulemaking requirements under the Administrative Procedure Act or any 
other statute unless the Agency certifies that the rule will not have a 
significant impact on a substantial

[[Page 37290]]

number of small entities. Small entities include small businesses, 
small organizations, and small governmental jurisdictions.
    For purposes of assessing the impact of this rule on small 
entities, small entity is defined as: (1) A small business that meets 
the definition of a small business found in the Small Business Act and 
codified at 13 CFR 121.201; (2) a small governmental jurisdiction that 
is a government of a city, county, town, school district or special 
district with a population of less than 50,000; and (3) a small 
organization that is any not-for-profit enterprise which is 
independently owned and operated and is not dominant in its field.
    After considering the economic impacts of today's direct final rule 
on small entities, I certify that this action will not have a 
significant economic impact on a substantial number of small entities. 
In determining whether a rule has a significant economic impact on a 
substantial number of small entities, the impact of concern is any 
adverse economic impact on small entities, since the primary purpose of 
the regulatory flexibility analyses is to identify and address 
regulatory alternatives ``which minimize any significant economic 
impact of the proposed rule on small entities.'' 5 U.S.C. Sections 603 
and 604. Thus, an agency may certify that a rule will not have a 
significant economic impact on a substantial number of small entities 
if the rule relieves regulatory burden, or otherwise has a positive 
economic effect on all of the small entities subject to the rule. This 
direct final rule does not have a significant impact on a substantial 
number of small entities. The requirements under the rule impose no 
reporting, record-keeping, or compliance costs on small entities.

E. Unfunded Mandates

    Title II of the Unfunded Mandates Reform Act of 1995 (UMRA) Public 
Law 104-4, establishes requirements for Federal agencies to assess 
their regulatory actions on State, local and Tribal governments and the 
private sector. This direct final rule does not contain a Federal 
mandate that may result in expenditures of $100 million or more for 
State, local, and Tribal governments, in the aggregate, or the private 
sector in any one year. Any private sector costs for this action relate 
to paperwork requirements and associated expenditures that are far 
below the level established for UMRA applicability. Thus, the rule is 
not subject to the requirements of sections 202 and 205 of the UMRA.

F. Executive Order 13045

    Executive Order 13045, Protection of Children from Environmental 
Health Risks and Safety Risks (6 FR 19885, April 23, 1997), applies to 
any rule that: (1) Is determined to be economically significant as 
defined under Executive Order 12866; and (2) concerns an environmental 
health or safety risk that EPA has reason to believe may have 
disproportionate effect on children. If the regulatory action meets 
both criteria, the Agency must evaluate the environmental health or 
safety effects of the planned rule on children, and explain why the 
planned regulation is preferable to other potentially effective and 
reasonably feasible alternatives considered by the Agency.
    This rule is not subject to Executive Order 13045 because it is not 
a significant rule as defined by E.O. 12866, and because it does not 
involve decisions on environmental health or safety risks.

G. Executive Order 13084

    Under Executive Order 13084, EPA may not issue a regulation that is 
not required by statute, that significantly or uniquely affects the 
communities of Indian Tribal governments, and that imposes substantial 
direct compliance costs on those communities, unless the Federal 
government provides the funds necessary to pay for the direct 
compliance costs incurred by the Tribal governments, or EPA consults 
with those governments. If EPA complies by consulting, E.O. 13084 
requires EPA to provide to OMB, in a separately identified section of 
the preamble to the rule, a description of the extent of EPA's prior 
consultation with representatives of affected Tribal governments, a 
summary of the nature of their concerns, and a statement supporting the 
need to issue the regulation. In addition, Executive Order 13084 
requires EPA to develop an effective process permitting elected and 
other representatives of Indian tribal governments ``to provide 
meaningful and timely input in the development of regulatory policies 
on matters that significantly or uniquely affect their communities.''
    This rule does not significantly or uniquely affect the communities 
of Indian Tribal governments. Accordingly, the requirements of section 
3(b) of Executive Order 13084 do not apply to this rule.

H. National Technology Transfer and Advancement Act of 1995

    Section 12(d) of the National Technology Transfer and Advancement 
Act of 1995 (NTTAA), Public Law 104-113, section 12(d) (15 U.S.C. 272 
note), directs EPA to use voluntary consensus standards in its 
regulatory activities unless to do so would be inconsistent with 
applicable law or otherwise impractical. Voluntary consensus standards 
are technical standards (e.g., materials specifications, test methods, 
sampling procedures and business practices) that are developed or 
adopted by voluntary consensus standards bodies. The NTTAA directs EPA 
to provide Congress, through OMB, explanations when the Agency decides 
not to use available and applicable voluntary consensus standards.
    This rule does not involve technical standards. Therefore, EPA did 
not consider the use of any voluntary consensus standards.

I. Executive Order 13132

    Executive Order 13132, entitled ``Federalism'' (64 FR 43255, August 
10, 1999), requires EPA to develop an accountable process to ensure 
``meaningful and timely input by State and local officials in the 
development of regulatory policies that have federalism implications.'' 
``Policies that have federalism implications'' are defined in the 
Executive Order to include regulations that have ``substantial direct 
effects on the States, on the relationship between the national 
government and the States, or on the distribution of power and 
responsibilities among the various levels of government.''
    Under Section 6 of Executive Order 13132, EPA may not issue a 
regulation that has federalism implications, that imposes substantial 
direct compliance costs, and that is not required by statute, unless 
the Federal government provides the funds necessary to pay the direct 
compliance costs incurred by State and local governments, or EPA 
consults with State and local officials early in the process of 
developing the proposed regulation. EPA also may not issue a regulation 
that has federalism implications and that preempts State law, unless 
the Agency consults with State and local officials early in the process 
of developing the proposed regulation.
    This direct final rule does not have federalism implications. It 
will not have substantial direct effect on the States, on the 
relationship between the national government and the States, or on the 
distribution of power and responsibilities among the various levels of 
government, as specified in Executive Order 13132. The rule amends the 
EPA Acquisition Regulation relating to internal agency procedures 
addressing: (1) Processing of individual FAR deviations, (2) 
redelegation of

[[Page 37291]]

agency contract ratification authority, (3) debarment, suspension and 
ineligibility of contractors, and (4) reduction or suspension of 
contract payments upon finding of fraud. Thus, the requirements of 
section 6 of the Executive Order do not apply to this rule.

J. Submission to Congress and the General Accounting Office

    The Congressional Review Act, 5 U.S.C. 801 et seq., as added by the 
Small Business Regulatory Enforcement Fairness Act of 1996, generally 
provides that before a rule may take effect, the agency promulgating 
the rule must submit a rule report, which includes a copy of the rule, 
to each House of Congress and to the Comptroller General of the United 
States. EPA will submit a report containing this rule and other 
required information to the U. S. Senate, the U. S. House of 
Representatives, and the Comptroller General of the United States prior 
to publication of the rule in the Federal Register. A major rule cannot 
take effect until 60 days after it is published in the Federal 
Register. This action is not a ``major rule'' as defined by 5 U.S.C. 
804(2).

    Authority: The provisions of this regulation are issued under 5 
U.S.C. 301; section 205(c), 63 Stat. 390, as amended 40 U.S.C. 
486(c).

List of Subjects in 48 CFR Parts 1501, 1509, 1532 and 1552

    Government procurement.

    Therefore, 48 CFR Chapter 15 is amended as set forth below:
    1. The authority citation for parts 1501, 1509, 1532 and 1552 
continues to read as follows:

    Authority: Sec. 205(c), 63 Stat. 390 as amended, 40 U.S.C. 
486(c).

    2. Section 1501.403 is revised to read as follows:


1501.403  Individual deviations.

    Requests for individual deviations from the FAR and the EPAAR shall 
be submitted to the Head of the Contracting Activity (HCA) for 
approval. Requests submitted shall cite the specific part of the FAR or 
EPAAR from which it is desired to deviate, shall set forth the nature 
of the deviation(s), and shall give the reasons for the action 
requested.
    3. Section 1501.602-3(b) is revised to read as follows:


1501.602-3  Ratifications of unauthorized commitments.

* * * * *
    (b) Ratification Approval. The Chief of the Contracting Office 
(CCO) is delegated authority to be the ratifying official. In order to 
act as the ratifying official, a CCO or an acting CCO must have 
delegated contracting officer authority. A CCO or acting CCO cannot 
approve a ratification if he/she acted as the contracting officer in 
preparing the determination and findings required under paragraph 
(c)(3) of this section.
* * * * *

    4. Subpart 1509.4 is revised to read as follows:

Subpart 1509.4--Debarment, Suspension and Ineligibility

1509.403   Definitions.
1509.406   Debarment.
1509.406-3   Procedures.
1509.407   Suspension.
1509.407-3   Procedures.


1509.403  Definitions.

    The ``Debarring Official'' and the ``Suspending Official'' as 
defined in FAR 9.403 is a designated individual located in the Office 
of Grants and Debarment. This Agency official is authorized to make the 
determinations and provide the notifications required under FAR subpart 
9.4 or this subpart, except for the determinations required by FAR 
9.405-1(a) which are to be made by the Head of the Contracting 
Activity. All compelling reason determinations to be made by the 
Debarring or Suspending Official under FAR subpart 9.4 or this subpart 
will be made only after coordination and consultation with the Head of 
the Contracting Activity. See also 40 CFR part 32.


1509.406  Debarment.


1509.406-3  Procedures.

    (a) Investigation and referral.--(1) Contracting officer 
responsibility. (i) When contracting personnel discover information 
which indicates that a cause for debarment may exist, they shall 
promptly report such information to the cognizant Chief of the 
Contracting Office (CCO). Purchasing agents in simplified acquisition 
activities which do not come under the direct cognizance of a CCO shall 
report such information by memorandum, through their immediate 
supervisor, and addressed to the cognizant CCO responsible for their 
office's contract acquisitions.
    (ii) Contracting officers shall review ``The List of Parties 
Excluded from Federal Procurement and Nonprocurement Programs'' to 
ensure that the Agency does not solicit offers from, award contracts 
to, or consent to subcontracts with listed contractors.
    (2) Chief of the Contracting Office responsibility. When the Chief 
of the Contracting Office determines that sufficient information is 
available to indicate that a cause for debarment may exist, such 
information shall be promptly reported by memorandum to the HCA. The 
memorandum provides the Chief of the Contracting Office's assessment of 
the information, any investigative report or audit, and any additional 
information he/she has discovered.
    (3) HCA responsibility. Upon receipt of a report of a suspected 
debarment situation, the HCA shall take the following actions:
    (i) Notify the Director, Suspension and Debarment Division, that 
investigation of a potential debarment has been initiated.
    (ii) Review the reported information.
    (iii) Investigate as necessary to verify or develop additional 
information.
    (iv) Refer the matter through the Suspension and Debarment Division 
to the Debarring Official for consideration of debarment; request that 
the Suspension and Debarment Division evaluate the information and, if 
appropriate, refer the matter to the Debarring Official for 
consideration of debarment; or recommend to the Suspension and 
Debarment Division that the matter be closed without further action 
because the facts do not warrant debarment.
    (v) Obtain legal counsel's opinion on referrals or recommendations 
made to the Debarring Official.
    (vi) Notify EPA Contracting Officers of those Contractors who are 
ineligible for solicitation, award, or subcontracting but who do not 
appear on the GSA Consolidated List; e.g., those who are ineligible 
based on a settlement reached by the Debarring Official under which the 
Contractor has agreed to voluntarily exclude itself from participation 
in Government contracting/subcontracting for a specified period or 
because of a Notice of Proposal to Debar.
    (4) Any official. When information is discovered which may indicate 
potential criminal or civil fraud activity, such information must be 
referred promptly to the EPA Office of Inspector General.
    (5) Debarring Official's responsibility. The Debarring Official 
shall:
    (i) Review referrals from the HCA together with the HCA's 
recommendations, if any, and determine whether further consideration by 
the Debarring Official is warranted and take such actions as are 
required by FAR subpart 9.4;
    (ii) Obtain the HCA's recommendation prior to reaching a voluntary 
exclusion settlement with a Contractor in lieu of debarment;
    (iii) Promptly notify the HCA of Contractors with whom a settlement 
in lieu of debarment has been reached

[[Page 37292]]

under which the Contractor voluntarily excludes itself from or 
restricts its participation in Government contracting/subcontracting 
for a specified period; and of Contractors who have received a Notice 
of Proposal to Debar.
    (b) [Reserved]


1509.407  Suspension.


1509.407-3  Procedures.

    The procedures prescribed in 1509.406-3(a) shall be followed under 
conditions which appear to warrant suspension of a Contractor.
    5. Section 1532.006 is added preceding subpart 1532.1 is added to 
read as follows:


1532.006  Reduction or suspension of contract payments upon finding of 
fraud.


1532.006-1  General.

    (a)-(b) [Reserved]
    (c) Agency responsibilities and determinations under FAR 32.006 
are, consistent with FAR 32.006-1(c), delegated to the Head of the 
Contracting Activity, if that individual is not below Level IV of the 
Executive Schedule. If the Head of the Contracting Activity is below 
Level IV of the Executive Schedule, then Agency responsibilities and 
determinations under FAR 32.006 are delegated to the Assistant 
Administrator for Administration and Resources Management.


1532.006-2  Definitions.

    The Remedy Coordination Official for EPA is the Assistant Inspector 
General for Investigations.


1532.006-3  Responsibilities.

    (a) EPA shall use the procedures in FAR 32.006-4 when determining 
whether to reduce or suspend further payments to a contractor when 
there is a report from the Remedy Coordination Official finding 
substantial evidence that the contractor's request for advance, partial 
or progress payments is based on fraud and recommending that the Agency 
reduce or suspend such payments to the contractor.
    (b) [Reserved]
    6. Section 1552.209-74 is amended as follows:
    a. In paragraph (h) of the clause, remove ``(g)'' and add in its 
place ``(h)'';
    b. In Alternate I paragraph (h), remove ``(g)'' and add in its 
place ``(h)'';
    c. In Alternate II paragraph (h), remove ``(g)'' and add in its 
place ``(h)'';
    d. In Alternate III paragraph (e), remove ``(d)'' and add in its 
place ``(e)''.
    e. In Alternate IV paragraph (h), remove ``(g)'' and add in its 
place ``(h)''.
    f. In Alternate VI paragraph (i) remove ``(h)'' and add in its 
place ``(i)''.

    Dated: May 12, 2000.
Betty L. Bailey,
Director, Office of Acquisition Management.
[FR Doc. 00-14635 Filed 6-13-00; 8:45 am]
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