[Federal Register Volume 65, Number 145 (Thursday, July 27, 2000)]
[Proposed Rules]
[Pages 46332-46333]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 00-19017]



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Part VII





Department of Defense

General Services Administration

National Aeronautics and Space Administration





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48 CFR Parts 42 and 52



Federal Acquisition Regulation; Final Contract Voucher Submission; 
Proposed Rule

  Federal Register / Vol. 65, No. 145 / Thursday, July 27, 2000 / 
Proposed Rules  

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DEPARTMENT OF DEFENSE

GENERAL SERVICES ADMINISTRATION

NATIONAL AERONAUTICS AND SPACE ADMINISTRATION

48 CFR Parts 42 and 52

[FAR Case 1999-026]
RIN 9000-AI86


Federal Acquisition Regulation; Final Contract Voucher Submission

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

ACTION: Proposed rule.

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SUMMARY: The Civilian Agency Acquisition Council and the Defense 
Acquisition Regulations Council (Councils) are proposing to amend the 
Federal Acquisition Regulation (FAR) to explicitly state the right of 
the contracting officer to unilaterally determine the final contract 
payment amount when the contractor does not submit the final invoice or 
voucher within the time specified in the contract. This contracting 
officer decision is final and binding upon the contractor and will not 
be subject to the right of appeal under the Contract Disputes Act.

DATES: Interested parties should submit comments in writing on or 
before September 25, 2000 to be considered in the formulation of a 
final rule.

ADDRESSES: Submit written comments to: General Services Administration, 
FAR Secretariat (MVRS), 1800 F Street, NW, Room 4035, ATTN: Laurie 
Duarte, Washington, DC 20405.
Submit electronic comments via the Internet to: [email protected]
    Please submit comments only and cite FAR case 1999-026 in all 
correspondence related to this case.

FOR FURTHER INFORMATION CONTACT: The FAR Secretariat, Room 4035, GS 
Building, Washington, DC, 20405, at (202) 501-4755 for information 
pertaining to status or publication schedules. For clarification of 
content, contact Ms. Linda Klein, Procurement Analyst, at (202) 501-
3775. Please cite FAR case 1999-026.

SUPPLEMENTARY INFORMATION:   

A. Background

    The Department of Defense established the Contract Close-out 
Working Integrated Process Team (CCWIPT) to improve the contract 
closeout process and reduce associated paperwork. On April 7, 1999, the 
team issued a report with a number of recommendations. The report found 
that the leading reason for contracts to remain open after they are 
physically complete is the contractor's failure to submit a final 
voucher to the Government. Therefore, one of the CCWIPT's 
recommendations is to revise the FAR to indicate that if a contractor 
has failed to submit any final invoice or voucher for a physically 
completed contract within the time provided, the contractor shall not 
have the right to appeal under the Disputes Clause at FAR 52.233-1, 
Disputes, any determination made by the contracting officer regarding 
the amount of final payment.
    The Councils have adopted the CCWIPT's recommendation in this 
proposed rule. The rule revises FAR 42.705, Final indirect cost rates, 
and FAR 52.216-7, Allowable Cost and Payment, to--
     Explicitly state that the contracting officer may issue a 
unilateral modification that reflects the contracting officer's 
determination of the amounts due to the contractor under a completed 
contract. The contracting officer may make this determination if the 
contractor fails to submit a completion invoice or voucher within the 
time specified (normally 120 days after settlement of the final 
indirect cost rates but may be longer, if approved in writing by the 
contracting officer); and
     Make the contracting officer's determination not subject 
to appeal under the Disputes Clause of the contract.
    This rule was not 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 not a major rule under 5 
U.S.C. 804.

B. Regulatory Flexibility Act

    The Councils do not expect this proposed rule to have a significant 
economic impact on a substantial number of small entities within the 
meaning of the Regulatory Flexibility Act, 5 U.S.C. 601, et seq., 
because it is unlikely that a contractor would appeal the contracting 
officer's determination. The contractor would have little left to 
dispute regarding the amount of final payment on the contract once the 
contractor has submitted a final indirect cost rate proposal, the 
auditor has completed a final incurred cost audit; and the contractor 
and the Government have negotiated and agreed to the final indirect 
rates. An Initial Regulatory Flexibility Analysis has, therefore, not 
been performed. We invite comments from small businesses and other 
interested parties. The Councils will consider comments from small 
entities concerning the affected FAR parts in accordance with 5 U.S.C. 
610. Interested parties must submit such comments separately and should 
cite 6 U.S.C. 601, et seq. (FAR case 1999-026), in correspondence.

C. Paperwork Reduction Act

    The Paperwork Reduction Act does not apply because the proposed 
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 Parts 42 and 52

    Government procurement.

    Dated: July 24, 2000.
Edward C. Loeb,
Director, Federal Acquisition Policy Division.
    Therefore, DoD, GSA, and NASA propose that 48 CFR parts 42 and 52 
be amended as set forth below:
    1. The authority citation for 48 CFR parts 42 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 42--CONTRACT ADMINISTRATION AND AUDIT SERVICES

    2. Amend Section 42.705 by revising paragraph (b) and by adding 
paragraph (c) to read as follows:


42.705  Final indirect cost rates.

* * * * *
    (b) Within 120 days (or longer period, if approved in writing by 
the contracting officer,) after settlement of the final annual indirect 
cost rates for all years of a physically complete contract, the 
contractor shall submit a completion invoice or voucher reflecting the 
settled amounts and rates.
    (c)(1) If the contractor fails to submit a completion invoice or 
voucher within the time specified in paragraph (b) of this section, the 
contracting officer may--
    (i) Determine the amounts due to the contractor under the contract; 
and
    (ii) Record this determination in a unilateral modification to the 
contract.
    (2) This contracting officer determination is--
    (i) Final and binding upon the contractor in discharge of all 
obligations to the contractor arising under the contract; and
    (ii) Not subject to the right of appeal under the Disputes clause.

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PART 52--SOLICITATION PROVISIONS AND CONTRACT CLAUSES

    3. Amend Section 52.216-7 by revising the date of the clause; in 
paragraph (d) by redesignating paragraph (d)(4) as (d)(5) and paragraph 
(d)(5) as (d)(4), respectively; revising the newly designated (d)(5); 
by adding paragraph (d)(6); and by amending paragraph (h)(1) by 
removing ``paragraph (d)(4)'' and adding, in its place, ``paragraph 
(d)(5)''. The revised text reads as follows:


52.216-7  Allowable Cost and Payment.

* * * * *

ALLOWABLE COST AND PAYMENT (DATE)

* * * * *
    (d) * * *
    (5) Within 120 days (or longer period, if approved in writing by 
the Contracting Officer,) after settlement of the final annual 
indirect cost rates for all years of a physically complete contract, 
the Contractor shall submit a completion invoice or voucher to 
reflect the settled amounts and rates.
    (6)(i) If the Contractor fails to submit a completion invoice or 
voucher within the time specified in paragraph (d)(5) of this 
clause, the Contracting Officer may--
    (A) Determine the amounts due to the Contractor under the 
contract; and
    (B) Record this determination in a unilateral modification to 
the contract.
    (ii) This Contracting Officer determination is--
    (A) Final and binding upon the Contractor in discharge of all 
obligations to the Contractor arising under the contract; and
    (B) Not subject to the right of appeal under the Disputes 
clause.
* * * * *

[FR Doc. 00-19017 Filed 7-26-00; 8:45 am]
BILLING CODE 6820-EP-P