[Federal Register Volume 66, Number 188 (Thursday, September 27, 2001)]
[Proposed Rules]
[Pages 49331-49341]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 01-23772]



[[Page 49331]]

=======================================================================
-----------------------------------------------------------------------

DEPARTMENT OF VETERANS AFFAIRS

48 CFR Parts 801, 825, 832, 836, 846, and 852

RIN 2900-AJ56


VA Acquisition Regulation: Construction and Architect-Engineer 
Contracts

AGENCY: Department of Veterans Affairs.

ACTION: Proposed rule.

-----------------------------------------------------------------------

SUMMARY: This document proposes to amend the Department of Veterans 
Affairs Acquisition Regulation (VAAR). We propose to update position 
titles, to make minor grammatical corrections and revisions, to revise 
and update section numbers and titles, to relocate material to 
correspond to the Federal Acquisition Regulation (FAR), and to delegate 
authority. In addition, we propose to update regulations on 
Construction and Architect-Engineer Contracts and on Solicitation 
Provisions and Contract Clauses, and to add coverage regarding the 
authority of the National Cemetery Administration to award architect-
engineer contracts. Also, we propose to replace a general prescription 
directing the use of all VAAR clauses relating to construction 
contracts with specific prescriptions for each clause, remove obsolete 
or duplicative material, update the VAAR regarding the requirement for 
certificates of current cost or pricing data, and provide agency 
procedures regarding disclosure of the Government cost estimate on 
construction contracts. This document would also remove a ``guarantee'' 
clause from the VAAR and provide agency procedures for VA contracting 
officers to use the FAR ``warranty'' clause for construction contracts 
exceeding the micro-purchase threshold in order to protect the best 
interests of the Government. In addition, this document would revise 
provisions regarding the acceptance of foreign construction materials 
to correspond to changes made in the FAR and to comply with the North 
American Free Trade Agreement and the Trade Agreements Act.

DATES: Comments on the proposed rule should be submitted on or before 
November 26, 2001 to be considered in the formulation of the final 
rule.

ADDRESSES: Mail or hand-deliver written comments to: Director, Office 
of Regulations Management (02D), Department of Veterans Affairs, 810 
Vermont Ave., NW., Room 1154, Washington, DC 20420; or fax comments to 
(202) 273-9289; or e-mail comments to ``[email protected]''. 
Comments should indicate that they are submitted in response to ``RIN 
2900-AJ56.'' All comments received will be available for public 
inspection in the Office of Regulations Management, Room 1158, between 
the hours of 8 a.m. and 4:30 p.m., Monday through Friday (except 
holidays).

FOR FURTHER INFORMATION CONTACT: Don Kaliher, Acquisition Program 
Management Team (95A), Office of Acquisition and Materiel Management, 
Department of Veterans Affairs, 810 Vermont Ave., NW., Washington, DC 
20420, telephone (202) 273-8819.

SUPPLEMENTARY INFORMATION: The Federal Acquisition Regulation (FAR) 
contains prescriptions for the use of clauses in the applicable related 
FAR part. It contains the actual clauses in one part, part 52. 
Consistent with this organization of the FAR, the prescription for the 
use of the FAR clause at 52.236-26, Preconstruction Conference, is 
located in FAR part 36, which deals with construction. Although the 
Department of Veterans Affairs Acquisition Regulation (VAAR) contains 
all clauses in one part, part 852, it currently does not, in most 
cases, follow the organization used in the FAR regarding the location 
of the prescriptions. This document proposes to reorganize the VAAR to 
correspond to the organization of the FAR by relocating the existing 
prescriptions or placing the new proposed prescriptions in the 
appropriate parts of the VAAR.
    The VAAR currently contains a general prescription at 852.236-70, 
Clauses and provisions for fixed-price construction contracts, which 
requires the contracting officer to include the construction-related 
clauses in the VAAR in all construction solicitations and contracts, 
regardless of dollar value. In addition, a few of the clauses in the 
VAAR have their own individual prescriptions. This document proposes, 
as set forth below, to remove the general prescription that applies to 
all construction-related clauses in the VAAR and, for each clause that 
does not currently have an individual prescription, to provide an 
individual prescription to specify when the clause is to be used.
    The general prescription at 852.236-70 requires the contracting 
officer to include the following clauses in all solicitations and 
contracts for construction, regardless of dollar value:

    852.236-76, Correspondence.
    852.236-77, Reference to ``standards.''
    852.236-78, Government supervision.
    852.236-80, Subcontracts and work coordination.
    852.236-84, Schedule of work progress.
    852.236-85, Supplementary labor standard provisions.
    852.236-86, Worker's compensation.
    852.236-88, Contract changes--supplement.
    852.236-91, Special notes.

    This document proposes to require use of these clauses only if the 
solicitation or contract is expected to exceed the micro-purchase 
threshold (currently $2,000 for construction) rather than in all 
solicitations and contracts, regardless of dollar value, as is 
currently required by the VAAR. The FAR does not require the use of any 
clauses in contracts below the micro-purchase threshold and this change 
would correspond to the FAR.
    The general prescription at 852.236-70 also requires the 
contracting officer to include the clause at 852.236-79, Daily report 
of workers and materials, in all solicitations and contracts for 
construction, regardless of dollar value. This document proposes to 
require use of this clause only if the solicitation or contract is 
expected to exceed the simplified acquisition threshold (currently 
$100,000) rather than in all solicitations and contracts as is 
currently required by the VAAR. Use of this clause in lesser dollar 
value contracts would be optional on the part of the contracting 
officer, when determined to be in the best interest of the Government. 
This clause requires information from the contractor that appears 
critical to the proper administration of more complicated, larger 
dollar value contracts, but may not be necessary on smaller, less 
complicated projects.
    The general prescription at 852.236-70 further requires the 
contracting officer to include the following clauses in all 
solicitations and contracts for construction, regardless of dollar 
value:

    852.236-71, Specifications and drawings for construction.
    852.236-72, Performance of work by the contractor.
    852.236-74, Inspection of construction.
    852.236-82, Payment under fixed-price construction contracts 
(without NAS).
    852.236-83, Payment under fixed-price construction contracts 
(including NAS).

    This document proposes to require use of these clauses only if the 
solicitation or contract includes the FAR clauses that these clauses 
supplement rather than in all solicitations and contracts. Since these 
clauses supplement particular FAR clauses, we believe there is no 
reason to include them in the solicitation or contract if the 
solicitation or contract does not also include the applicable FAR 
clauses.

[[Page 49332]]

    FAR 36.203(c) states that the overall amount of the Government's 
construction cost estimate shall not be disclosed except as permitted 
by agency regulations. The VAAR does not currently contain regulations 
addressing this issue. We propose to add regulations at section 836.203 
providing that the overall amount of the Government's construction cost 
estimate shall not be disclosed until after contract award and then may 
be disclosed upon request. We believe this would ensure that release of 
this sensitive information does not inappropriately influence the 
outcome of the solicitation prior to award.
    The FAR at section 36.208 delegates to the head of the contracting 
activity the authority to authorize the use of cost-plus-fixed-fee, 
price-incentive, or other cost-variation type contracts concurrently 
with firm-fixed-price contracts. Section 836.208 of the VAAR currently 
restricts such authority to the Chief Facilities Management Officer or 
the Under Secretary for Health. We know of no reason for VA to be more 
restrictive than the FAR in delegating this authority. This document 
proposes to remove section 836.208 of the VAAR, thereby making the FAR 
delegation of authority applicable to VA.
    FAR section 36.209 requires the approval of the head of the agency 
or authorized representative before a contract for construction can be 
awarded to the architect-engineer firm that designed the project. The 
FAR does not specify whether section 36.209 applies to both design-bid-
build projects and design-build projects, as defined at FAR 36.102, or 
only to design-bid-build projects. A design-bid-build project is one 
where the design and construction are sequential and are contracted for 
separately with two contracts, one to design the project and the other 
to build the project, normally with two separate and independent 
contractors. A design-build project is one where both the design and 
construction work are combined in a single contract with one 
contractor. We believe a requirement for approval to award a design-
build contract, where a single contractor both designs and builds a 
project, is not necessary. Thus, this document proposes to add a 
statement to section 836.209 to clarify that the provisions of FAR 
36.209 and this section are applicable only to design-bid-build 
projects, not to design-build projects.
    The FAR at 36.602-3 states that, when acquiring architect-engineer 
(A/E) services, agencies shall provide for one or more A/E evaluation 
boards. The VAAR currently delegates authority to, and provides 
procedures for the establishment of A/E evaluation boards by, the 
Office of Facilities Management (OFM) and VA medical facilities. This 
document proposes to delegate the same authority to the National 
Cemetery Administration (NCA). This is necessary to clarify that NCA 
has the same authority to acquire A/E services as does OFM and VA 
medical facilities.
    FAR 36.211 states that advance notices and solicitations should be 
distributed to reach as many prospective offerors as practicable and 
provides other guidance to contracting officers on how to accomplish 
this. Section 836.211 of the VAAR currently authorizes the VA Central 
Office Project Manager to determine how VA Central Office construction 
specifications will be distributed. We believe there is no need for VA 
to have a separate section covering distribution of advance notices and 
solicitations applicable only to Central Office. Therefore, we propose 
to remove section 836.211. Upon removal of this section, VA Central 
Office would follow the FAR regarding the distribution of 
specifications.
    Section 836.213-4, Notice of award, is proposed to be added to 
specify when a notice of award (letter of acceptance) is required on a 
construction contract. The FAR specifies that the contracting officer 
shall make award by written notice when using sealed bid procedures 
(FAR 14.408-1(a)) and by furnishing the executed contract or other 
notice of award when using negotiated procedures (FAR 15.504). The FAR 
does not specify the method of notice when using the simplified 
procedures of FAR part 13. This document proposes to require the 
contracting officer to issue a notice of award (letter of acceptance) 
for any contract award in excess of $25,000. Contracts in excess of 
$25,000 require either payment protection (contracts greater than 
$25,000 but not greater than $100,000) or payment and performance bonds 
(contracts of $100,000 or more). The FAR at 36.213-4 requires the 
contracting officer to provide certain information to the contractor 
when a notice of award is issued, including information on bonds. We 
believe that use of a letter of acceptance is the best way to provide 
that information to the contractor, including information on the 
requirement for either payment protection or bonds.
    Section 836.371 of the VAAR currently contains guidance on the 
``notice to proceed,'' the letter that is sent to contractors on 
construction contracts establishing the start date for contract work. 
Section 836.371 currently requires the contracting officer to send the 
``notice to proceed'' by certified mail, return receipt requested, in 
order to provide proof of delivery. Other methods of delivery, such as 
overnight package delivery services, provide proof of delivery and may 
be less expensive or less administratively burdensome than certified 
mail. This document proposes to renumber this section as 836.213-70 and 
to revise the section to allow the contracting officer to use any 
delivery method that would provide proof of delivery. We believe this 
would reduce the cost and administrative burden of sending the ``notice 
to proceed.''
    The introductory text in section 852.236-88 currently requires that 
all proposed construction contract changes costing between $100,000 and 
$500,000 shall be accompanied by certificates of current cost or 
pricing data. This document proposes to relocate this introductory text 
to section 836.578 and to revise the text to require certificates of 
current cost or pricing data only if the proposed change exceeds 
$500,000. The FAR threshold for requiring certificates of current cost 
or pricing data is $500,000 and this proposed change appears necessary 
to ensure that the VAAR corresponds to the FAR requirements.
    Paragraph (b) of section 836.602-2 currently provides that the head 
of the contracting activity (HCA) or alternate shall serve on 
architect-engineer (A/E) evaluation boards at VA field facilities. Due 
to reorganization, not all VA field facilities have an HCA on site. 
Therefore, this document proposes to revise 836.602-2(b) to allow the 
senior contracting officer to serve on the board if an on-site HCA is 
not present. We believe this would ensure that a local representative 
with contracting experience and authority is available to serve on the 
board in the event that an HCA is not available.
    The FAR states that, when authorized by the agency, the short 
selection procedures of FAR 36.602-5 may be used to select firms for 
architect-engineer contracts not expected to exceed the simplified 
acquisition threshold. Although the VAAR currently authorizes the use 
of the short selection procedures, it also requires the approval of 
specified VA officials before those procedures may be used. This 
document proposes to remove the approval requirements and to simply 
authorize the use of the short selection procedures. We believe this 
will simplify the acquisition process and will remove an unnecessary 
administrative burden.
    The FAR at 36.603(c) provides that, under the direction of the 
parent agency, A/E evaluation boards shall

[[Page 49333]]

maintain an A/E qualifications file. We propose to add section 836.603 
to provide that the Chief Facilities Management Officer for VA Central 
Office, or the Chief, Engineering Service, for field facilities, shall 
be responsible for maintaining this file.
    The FAR at 46.710 authorizes agencies to use the FAR clause at 
52.246-21, Warranty of Construction, if use of a warranty clause has 
been approved under agency procedures. The VAAR does not currently 
contain agency procedures for use of the FAR warranty clause. Instead, 
the VAAR contains a ``Guaranty'' clause at 852.236-75 that is similar 
to the FAR clause at 52.246-21. This document proposes to delete the 
VAAR Guaranty clause, with the exception of paragraph (f) and 
Supplement I of that clause, and to provide agency procedures 
authorizing contracting officers to use the FAR clause in construction 
solicitations and contracts exceeding the micro-purchase threshold. We 
believe this proposed change would ensure that all VA construction 
contracts exceeding the micro-purchase threshold contain a warranty 
provision to protect the best interests of the Government.
    Paragraph (f) of the current VAAR clause at 852.236-75, Guaranty, 
provides VA with additional protections not found in the FAR clause at 
52.246-21, Warranty of Construction. Paragraph (f) provides that any 
special guaranties required under the contract are subject to the same 
elections set forth in the basic guaranty/warranty clause. This 
document proposes to retain this paragraph and to relocate the 
paragraph (as a new clause) to new section 852.246-1, Special 
warranties. This document also proposes to add a prescription for use 
of this new clause at 846.710-70 providing that contracting officers 
shall include the new clause in contracts as a supplement to the FAR 
clause at 52.246-21, Warranties. We believe this would ensure that this 
additional protection regarding special warranties, currently provided 
by the VAAR as paragraph (f) of 852.236-75, Guaranty, is continued, 
despite the proposed deletion of clause 852.236-75.
    The VAAR currently contains, as part of the Guaranty clause at 
852.236-75, a supplemental paragraph (Supplement I) for use in 
construction contracts that include guarantee period services. This 
supplemental paragraph provides remedies for the Government in the 
event that the contractor fails to furnish the guarantee period 
services. The FAR does not contain provisions addressing guarantee 
period services. This document proposes to renumber and keep this 
supplemental paragraph as new section 852.246-2, Warranty for 
construction--guarantee period services, to revise the paragraph to 
make it a supplement of the FAR clause at 52.246-21, Warranty for 
Construction, and to add a prescription for its use at new section 
846.710-71. We believe this would ensure that the VAAR retains an 
appropriate warranty clause addressing guarantee period services and a 
prescription for use of that clause.
    For a number of clauses currently in the VAAR, the VAAR states, in 
the introductory text of the respective sections, that the clauses 
supplement FAR clauses. This document proposes to move these 
introductory text statements to the bodies of the VAAR clauses to 
ensure that the statements are part of those clauses. This would ensure 
that contracts in which these clauses appear clearly state that these 
clauses supplement the applicable FAR clauses.
    The VAAR currently contains a number of clause alternates/
supplements that are to be used with the respective clauses under the 
specified circumstances. This document proposes to revise the method 
used in the VAAR to identify alternates to match the method used in the 
FAR. For instance, the introductory text for the clause at 836.236-81, 
Work coordination (alternate provision), states that the clause may be 
substituted for paragraph (b) of the clause at 852.236-80, Subcontracts 
and work coordination. In other words, it is an alternate for the 
clause at 852.236-80. We proposed to delete section number 852.236-81 
and revise the introductory text to clarify that the currently existing 
material at 852.236-81 is Alternate I to the clause at 852.236-80. We 
propose similar changes to the other alternates and supplements in the 
VAAR to match the way alternates are used in the FAR.
    The VAAR currently contains a prescription for the use of the 
clause at 852.236-89, Buy American Act, in the introductory text of 
that section. This document proposes to revise the prescription and 
relocate it to part 825, Foreign Acquisition. Since the clause concerns 
the Buy American Act (BAA) and foreign acquisition, the prescription is 
more appropriately located in that part of the VAAR.
    In addition, this document proposes to revise the prescription to 
the clause at 852.236-89, Buy American Act, and to revise the clause to 
correspond to changes in the FAR. Part 825 of the FAR was recently 
revised to make accommodations for the North American Free Trade 
Agreement (NAFTA) and the Trade Agreements Act (TAA). In doing so, an 
old FAR clause, 52.225-5, Buy American Act--Construction Materials, was 
deleted and two new clauses were created, 52.225-9, Buy American Act--
Balance of Payment Program--Construction Materials, and 52.225-11, Buy 
American Act--Balance of Payment Program--Construction Materials Under 
Trade Agreements. The VAAR clause at 852.236-89 currently references 
the old deleted FAR clause 52.225-5 and does not take into 
consideration the impact of NAFTA or TAA. This document proposes to 
revise the prescription for the use of the clause at 852.236-89 and to 
revise the clause to accommodate NAFTA and TAA. As currently written, 
the clause places extensive limitations on the acceptance of any 
foreign material on a VA construction project, regardless of the 
country of origin. Thus, the clause conflicts with NAFTA and TAA, which 
provide that, over certain dollar thresholds, construction materials 
from NAFTA or TAA designated countries will be exempt from BAA 
restrictions. This document proposes to add two alternate provisions 
for use with the VAAR clause at 852.236-89 to correspond to the changes 
made in the FAR and to ensure compliance with NAFTA and TAA. In 
addition, this document proposes to remove a delegation of authority 
reserved to the Secretary to approve determinations to accept foreign 
construction material and to instead follow the delegations of 
authority contained in the FAR at 25.202.
    The clause at 852.236-91, Special notes, currently requires a 
bidder to certify its business status and to certify that it will 
furnish data on its business if so requested. The Clinger-Cohen Act of 
1996 precludes agencies from requiring certifications in agency 
procurement regulations except those required by law or as approved by 
the head of the agency. This document proposes to remove the 
certification requirement in 852.236-91 and to change paragraph (a) of 
the clause to be a ``representation'' by the bidder. This proposed 
change is consistent with similar language used in the FAR, such as in 
FAR clause 52.219-19. The information attested to in this clause is 
considered important and VA's ability to require bidders to furnish 
business data is considered essential to the evaluation of the bidders' 
responsibility. By changing from a ``certification'' to a 
``representation,'' VA will still be able to collect the needed 
information and will be in compliance with the Clinger-Cohen Act.

Miscellaneous Changes

    This document proposes to make new delegations of authority, to 
revise and

[[Page 49334]]

update section numbers and titles, to update position titles, to make 
minor grammatical and other corrections and revisions, and to relocate 
material, all to correspond to the FAR. This document would also remove 
obsolete or duplicative material and make non-substantive clarifying 
changes.
    This document proposes to revise section 801.301-70, paragraph (c), 
to clarify which Office of Management and Budget (OMB) Paperwork 
Reduction Act (PRA) Control Numbers are assigned to which clauses. VAAR 
clause 852.236-81 is currently assigned OMB Control No. 2900-0422. This 
document proposes to rename section 852.236-81 as ``Alternate I'' under 
section 852.236-80. Therefore, this document proposes to remove the 
reference to 852.236-81 from section 801.301-70, paragraph (c), and 
replace it with a reference to 852.236-80 (Alt. I).
    This document proposes to obtain specific OMB PRA Control Numbers 
for the following clauses, shown below in full text:

Buy American Act (00/2001)

    (a) Reference is made to the clause entitled ``Buy American Act--
Balance of Payments Program--Construction Materials,'' FAR 52.225-9.
    (b) Notwithstanding a bidder's right to offer identifiable foreign 
construction material in its bid pursuant to FAR 52.225-9, VA does not 
anticipate accepting an offer that includes foreign construction 
material.
    (c) If a bidder chooses to submit a bid that includes foreign 
construction material, that bidder must provide a listing of the 
specific foreign construction material he/she intends to use and a 
price for said material. Bidders must include bid prices for comparable 
domestic construction material. If VA determines not to accept foreign 
construction material and no comparable domestic construction material 
is provided, the entire bid will be rejected.
    (d) Any foreign construction material proposed after award will be 
rejected unless the bidder proves to VA's satisfaction: (1) It was 
impossible to request the exemption prior to award, and (2) said 
domestic construction material is no longer available, or (3) where the 
price has escalated so dramatically after the contract has been awarded 
that it would be unconscionable to require performance at that price. 
The determinations required by (1), (2), and (3) of this paragraph 
shall be made in accordance with subpart 825.2 and FAR 25.2.
    (e) By signing this bid, the bidder declares that all articles, 
materials and supplies for use on the project shall be domestic unless 
specifically set forth on the Bid Form or addendum thereto.

(End of Cause)

    Alternate I (00/2001). As prescribed in 825.1102(b), substitute the 
following paragraphs for paragraphs (a) and (b) of the basic clause:
    (a) Reference is made to the clause entitled ``Buy American Act--
Balance of Payment Program--Construction Materials Under Trade 
Agreements,'' FAR 52.225-11.
    (b) The restrictions contained in this clause 852.236-89 are waived 
for North American Free Trade Agreement (NAFTA) country construction 
material, as defined in FAR 52.225-11. Notwithstanding a bidder's right 
to offer identifiable foreign construction material in its bid pursuant 
to FAR 52.225-11, VA does not anticipate accepting an offer that 
includes foreign construction material, other than NAFTA country 
construction material.
    Alternate II (00/2001). As prescribed in 825.1102(c), substitute 
the following paragraphs for paragraphs (a) and (b) of the basic 
clause:
    (a) Reference is made to the clause entitled ``Buy American Act--
Balance of Payment Program--Construction Materials Under Trade 
Agreements,'' FAR 52.225-11.
    (b) The restrictions contained in this clause 852.236-89 are waived 
for designated country and North American Free Trade Agreement (NAFTA) 
country construction material, as defined in FAR 52.225-11. 
Notwithstanding a bidder's right to offer identifiable foreign 
construction material in its bid pursuant to FAR 52.225-11, VA does not 
anticipate accepting an offer that includes foreign construction 
material, other than designated country or NAFTA country construction 
material.

852.236-91, Special Notes (00/2001)

    (a) Signing of the bid shall be deemed to be a representation by 
the bidder that:
    (1) Bidder is a construction contractor who owns, operates, or 
maintains a place of business, regularly engaged in construction, 
alteration or repair of buildings, structures, communications 
facilities, or other engineering projects, including furnishing and 
installing of necessary equipment; or
    (2) If newly entering into a construction activity, bidder has made 
all necessary arrangements for personnel, construction equipment, and 
required licenses to perform construction work; and
    (3) Upon request, prior to award, bidder will promptly furnish to 
the Government a statement of facts in detail as to bidder's previous 
experience (including recent and current contracts), organization 
(including company officers), technical qualifications, financial 
resources and facilities available to perform the contemplated work.
    (b) Unless otherwise provided in this contract, where the use of 
optional materials or construction is permitted the same standard of 
workmanship, fabrication and installation shall be required 
irrespective of which option is selected. The contractor shall make any 
change or adjustment in connecting work or otherwise necessitated by 
the use of such optional material or construction, without additional 
cost to the Government.
    (c) When approval is given for a system component having functional 
or physical characteristics different from those indicated or 
specified, it is the responsibility of the contractor to furnish and 
install related components with characteristics and capacities 
compatible with the approved substitute component as required for 
systems to function as noted on drawings and specifications. There 
shall be no additional cost to the Government.
    (d) In some instances it may have been impracticable to detail all 
items in specifications or on drawings because of variances in 
manufacturers' methods of achieving specified results. In such 
instances the contractor will be required to furnish all labor, 
materials, drawings, services and connections necessary to product 
systems or equipment which are completely installed, functional, and 
ready for operation by facility personnel in accordance with their use.
    (e) Claims by the contractor for delay attributed to unusually 
severe weather must be supported by climatological data covering the 
period and the same period for the 10 preceding years. When the weather 
in question exceeds in intensity or frequency the 10 year average, the 
excess experienced shall be considered ``unusually severe.'' Comparison 
shall be on a monthly basis. Whether or not unusually severe weather in 
fact delays the work will depend upon the effect of weather on the 
branches of work being performed during the time under consideration.

(End of Clause)

Paperwork Reduction Act

    Under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3520), 
collections of information are contained in clauses 852.236-89, Buy 
American Act, and 852.236-91, Special Notes, as set forth in the 
Supplementary Information portion of this proposed rule. These are 
existing clauses and the

[[Page 49335]]

paperwork requirements were previously included in VA's approved, but 
now expired, Paperwork Reduction Act request covering all acquisition 
activities under parts 813, 814, and 815 of the VAAR. This notice is to 
obtain specific Office of Management and Budget (OMB) control numbers 
for these specific clauses. As required under section 3507(d) of the 
Act, VA has submitted a copy of this proposed rulemaking action to OMB 
for its review of the collection of information.
    OMB assigns control numbers to collections of information it 
approves. VA may not conduct or sponsor, and a person is not required 
to respond to, a collection of information unless it displays a 
currently valid OMB control number.
    Comments on the collection of information should be submitted to 
the Office of Management and Budget, Attention: Desk Officer for the 
Department of Veterans Affairs, Office of Information and Regulatory 
Affairs, Washington, DC 20503, with copies to the Director, Office of 
Regulations Management (02D), Department of Veterans Affairs, 810 
Vermont Ave., NW., Washington, DC 20420. Comments should indicate that 
they are submitted in response to ``RIN 2900-AJ56.''
    Title and Provision/Clause Number: Clause at 852.236-89, Buy 
American Act.
    Summary of collection of information: This clause is used in 
solicitations and contracts for construction that also contain the FAR 
clause at 52.225-9, Buy American Act--Balance of Payment Program--
Construction Material, or the FAR clause at 52.225-11, Buy American 
Act--Balance of Payment Program--Construction Material Under Trade 
Agreements. It requires the contractor, if the contractor wishes to 
submit a bid that includes foreign materials, to furnish a list of the 
specific foreign materials the contractor intends to use and a price 
for such materials.
    Description of need for information and proposed use of 
information: The information is required to evaluate whether VA will 
accept or reject the bid that includes foreign materials. The 
information is needed to ensure compliance with the Buy American Act 
while still allowing for the use of materials subject to the North 
American Free Trade Agreement or the Trade Agreements Act.
    Description of likely respondents: Firms submitting bids which 
include foreign materials.
    Estimated number of respondents: 40.
    Estimated frequency of responses: Once with the bid.
    Estimated average burden per collection: 30 minutes.
    Estimated total annual reporting and recordkeeping burden: 20 
hours.

    Title and Provision/Clause Number: Clause at 852.236-91, Special 
notes.
    Summary of collection of information: This clause is used in 
solicitations and contracts for construction that are expected to 
exceed the micro-purchase threshold. It requires the bidder, at the 
request of the contracting officer, to furnish information on the 
bidder's previous experience, organization, technical qualifications, 
financial resources, and facilities available to perform the work. 
Generally, this information is requested only from the bidder in line 
for award.
    In addition, this clause requires contractors to submit, along with 
any claim for weather delay, climatological data covering the period of 
the claim and covering the same period for the 10 preceding years.
    Description of need for information and proposed use of 
information: The information is required to assist the contracting 
officer in evaluating the bidder's qualifications and responsibility 
and to assist the contracting officer in evaluating a contractor's 
claim based on severe weather.
    Description of likely respondents: The low bidder on a construction 
contract solicitation and any contractors submitting a contract claim 
based on severe weather conditions.
    Estimated number of respondents: 850 low bidders and 20 contractors 
submitting weather related claims.
    Estimated frequency of responses: Once for each low bidder and once 
for each weather related claim.
    Estimated average burden per collection: 30 minutes for each low 
bidder and 60 minutes for each weather related claim.
    Estimated total annual reporting and recordkeeping burden: 445 
hours.
    The Department considers comments by the public on proposed 
collections of information in--
     Evaluating whether the proposed collections of information 
are necessary for the proper performance of the functions of the 
Department, including whether the information will have practical 
utility;
     Evaluating the accuracy of the Department's estimate of 
the burden of the proposed collections of information, including the 
validity of the methodology and assumptions used;
     Enhancing the quality, usefulness, and clarity of the 
information to be collected; and
     Minimizing the burden of the collections of information on 
those who are to respond, including through the use of appropriate 
automated, electronic, mechanical, or other technological collection 
techniques or other forms of information technology, e.g., permitting 
electronic submission of responses.
    OMB is required to make a decision concerning the proposed 
collection of information contained in this proposed rule between 30 
and 60 days after publication of this document in the Federal Register. 
Therefore, a comment to OMB is best assured of having its full effect 
if OMB receives it within 30 days of publication. This does not affect 
the deadline for the public to comment on the proposed regulation.

Executive Order 12866

    This document has been reviewed by the Office of Management and 
Budget under Executive Order 12866.

Regulatory Flexibility Act

    The Secretary hereby certifies that the adoption of this proposed 
rule would not have a significant economic impact on a substantial 
number of small entities as they are defined in the Regulatory 
Flexibility Act (RFA), 5 U.S.C. 601-612. The proposed changes are 
small-business neutral and will not have a significant economic impact 
on a substantial number of small businesses. Therefore, pursuant to 5 
U.S.C. 605(b), this proposed rule is exempt from the initial and final 
regulatory flexibility analysis requirements of Secs. 603 and 604.

List of Subjects

48 CFR Part 825

    Foreign currencies, Foreign trade, Government procurement.

48 CFR Parts 832 and 846

    Government procurement.

48 CFR Parts 801, 836 and 852

    Government procurement, Reporting and recordkeeping requirements.

    Approved: May 23, 2001.
Anthony J. Principi,
Secretary of Veterans Affairs.
    For the reasons set forth in the preamble, 48 CFR Chapter 8 is 
proposed to be amended as follows:

PART 801--VETERANS AFFAIRS ACQUISITION REGULATIONS SYSTEM

    1. The authority citation for part 801 continues to read as 
follows:

    Authority: 38 U.S.C. 501 and 40 U.S.C. 486(c).

[[Page 49336]]

801.103-70  [Redesignated as 801.104-70]

    2. Section 801.103-70 is redesignated as section 801.104-70.
    3.-4. In section 801.301-70, paragraph (b) introductory text is 
added; paragraph (b)(1) is revised; and the table in paragraph (c) is 
amended by removing ``852.236-81'' and adding in its place ``852.236-
82'', and by adding in numerical order the following sections and OMB 
control numbers to read as follows:


801.301-70  Paperwork Reduction Act requirements.

* * * * *
    (b) Contractors will not be requested to maintain systems of 
records unless prescribed in FAR or this VAAR.
    (1) A deviation to this prohibition may be processed in accordance 
with 801.403 in order to allow the contracting officer to require 
contractor reporting or recordkeeping beyond that prescribed in FAR and 
VAAR. The request for deviation will clearly specify what information 
or recordkeeping will be required and why it is required. The request 
will be signed by the head of the contracting activity.
* * * * *
    (c) * * *

------------------------------------------------------------------------
 48 CFR part or section where identified
              and described                   Current OMB Control No.
------------------------------------------------------------------------
 
                  *        *        *        *        *
852.236-80 (Alt. I)......................  2900-0422
 
                  *        *        *        *        *
852.236-89...............................  2900-XXXX
852.236-91...............................  2900-XXXX
 
                  *        *        *        *        *
------------------------------------------------------------------------

PART 825--FOREIGN ACQUISITION

    5. The authority citation for part 825 continues to read as 
follows:

    Authority: 38 U.S.C. 501 and 40 U.S.C. 486(c).

    6. Subpart 825.9 is amended by:
    A. Redesignating subpart 825.9 as 825.10 and revising the subpart 
heading.
    B. Redesignating section 825.901 as 825.1001 and revising the 
section heading.
    The redesignations and revisions read as follows:

Subpart 825.10--Additional Foreign Acquisition Regulations


825.1001  Waiver of right to examination of records.

    7. Subpart 825.11 and section 825.1102 are added to read as 
follows:

Subpart 825.11--Solicitation Provisions and Contract Clauses


825.1102  Solicitation provisions and contract clauses.

    The Buy American Act (41 U.S.C. 10a-d), except as modified by the 
North American Free Trade Agreement (NAFTA) and the Trade Agreements 
Act (TAA), requires that only domestic construction material shall be 
used in the performance of contracts for construction. To clarify VA's 
position on foreign material, the contracting officer shall insert the 
clause at 852.236-89, Buy American Act, in solicitations and contracts 
for construction that contain the FAR clause at 52.225-9, Buy American 
Act--Balance of Payments Program--Construction Materials.
    (b) For solicitations and contracts for construction that include 
the FAR clause at 52.225-11, Buy American Act--Balance of Payment 
Program--Construction Materials Under Trade Agreements, with its 
Alternate I (i.e., subject only to NAFTA), insert the clause at 
852.236-89, Buy American Act, with its Alternate I.
    (c) For solicitations and contracts that include the FAR clause at 
52.225-11 without its Alternate I (i.e., subject to both NAFTA and 
TAA), insert the clause at 852.236-89, Buy American Act, with its 
Alternate II.

PART 832--CONTRACT FINANCING

    8. The authority citation for part 832 continues to read as 
follows:

    Authority: 38 U.S.C. 501 and 40 U.S.C. 486(c).

    9. Subpart 832.1, consisting of section 832.111, is added to read 
as follows:

Subpart 832.1--Non-Commercial Item Purchase Financing


832.111  Contract clauses for non-commercial purchases.

    (a) The contracting officer shall insert the clause at 852.236-82, 
Payments under fixed-price construction contracts (without NAS), in 
solicitations and contracts for construction that include the FAR 
clause at 52.232-5, Payments Under Fixed-Price Construction Contracts, 
but that do not contain a section entitled ``Network Analysis System 
(NAS).'' When the solicitations or contracts include guarantee period 
services, the contracting officer shall use the clause with its 
Alternate I.
    (b) The contracting officer shall insert the clause at 852.236-83, 
Payments under fixed-price construction contracts (including NAS), in 
solicitations and contracts for construction that include the FAR 
clause at 52.232-5, Payments Under Fixed-Price Construction Contracts, 
and that also contain a section entitled ``Network Analysis System 
(NAS).'' When the solicitations or contracts include guarantee period 
services, the contracting officer shall use the clause with its 
Alternate I.

PART 836--CONSTRUCTION AND ARCHITECT-ENGINEER CONTRACTS

    10. The authority citation for part 836 continues to read as 
follows:

    Authority: 38 U.S.C. 501 and 40 U.S.C. 486(c).


836.202  [Amended]

    11. Section 836.202 is amended by:
    A. In paragraph (b), removing ``of contract'' and adding, in its 
place, ``of a contract''.
    B. In paragraph (c), adding a ``comma'' immediately after ``FAR 
52.236-5''; removing ``the clause'' and adding, in its place, ``the 
contracting officer shall include the clause''; and removing ``shall be 
included''.
    12. Section 836.203 is added to read as follows:


836.203  Government estimate of construction costs.

    The overall amount of the Government estimate shall not be 
disclosed until after award of the contract. After award, the overall 
amount may then be disclosed upon request.


836.208  [Removed]

    13. Section 836.208 is removed.
    14. Section 836.209 is revised to read as follows:


836.209  Construction contracts with architect-engineer firms.

    When it is considered necessary or advantageous to award a contract 
for construction of a design-bid-build project, as defined at FAR 
36.102, to the firm or person that designed the project, prior approval 
will be requested from the facility director or manager or the 
Director, Technical Support Service (for National Cemetery 
Administration contracts) for contracts involving nonrecurring 
maintenance (NRM) funds or from the Chief Facilities Management 
Officer, Office of Facilities Management, for contracts involving 
construction funds. Complete justification will be furnished in the 
request. This section does not apply to design-build contracts, as 
defined at FAR 36.102.


836.211  [Removed]

    15. Section 836.211 is removed.
    16. Section 836.213-4 is added to read as follows:

[[Page 49337]]

836.213-4  Notice of award.

    The contracting officer shall provide the contractor a notice of 
award (letter of acceptance) for any contract award in excess of 
$25,000.


836.371  [Redesignated as 836.213-70]

    17. Section 836.371 is amended by:
    A. Redesignating section 836.371 as 836.213-70.
    B. In paragraph (b), removing ``requested. It will'' and adding, in 
its place, ``requested, or any other method that provides signed 
evidence of receipt. The notice to proceed will''; and removing ``post 
office.'' and adding, in its place, ``post office or on the proof of 
delivery provided by the delivery service.''
    C. In paragraph (d), removing ``mail is used, the certified mail 
receipt card returned by the post office will'' and adding, in its 
place, ``mail or other method of delivery is used, the certified mail 
receipt card returned by the post office or the proof of delivery 
provided by the delivery service will''.


836.3  [Removed]

    18. Subpart 836.3 is removed.
    19. Section 836.501 is added to read as follows:


836.501  Performance of work by the contractor.

    The contracting officer shall insert the clause at 852.236-72, 
Performance of work by the contractor, in solicitations and contracts 
for construction that contain the FAR clause at 52.236-1, Performance 
of Work by the Contractor. When the solicitations and contracts include 
a section entitled ``Network Analysis System (NAS),'' the contracting 
officer shall use the clause with its Alternate I.
    20. Section 836.521 is added to read as follows:


836.521  Specifications and drawings for construction.

    The contracting officer shall insert the clause at 852.236-71, 
Specifications and drawings for construction, in solicitations and 
contracts for construction that contain the FAR clause at 52.236-21, 
Specifications and Drawings for Construction.
    21. Sections 836.570 through 836.579 are added to read as follows:


836.570  Correspondence.

    The contracting officer shall insert the clause at 852.236-76, 
Correspondence, in solicitations and contracts for construction 
expected to exceed the micro-purchase threshold.


836.571  Reference to ``standards.''

    The contracting officer shall insert the clause at 852.236-77, 
Reference to ``standards,'' in solicitations and contracts for 
construction expected to exceed the micro-purchase threshold.


836.572  Government supervision.

    The contracting officer shall insert the clause at 852.236-78, 
Government supervision, in solicitations and contracts for construction 
expected to exceed the micro-purchase threshold.


836.573  Daily report of workers and materials.

    The contracting officer shall insert the clause at 852.236-79, 
Daily report of workers and materials, in solicitations and contracts 
for construction expected to exceed the simplified acquisition 
threshold. The contracting officer may, when in the best interest of 
the Government, insert the clause in solicitations and contracts for 
construction when the contract amount is expected to be at or below the 
simplified acquisition threshold.


836.574  Subcontractors and work coordination.

    The contracting officer shall insert the clause at 852.236-80, 
Subcontracts and work coordination, in solicitations and contracts for 
construction expected to exceed the micro-purchase threshold. When the 
solicitations or contracts are for new construction work with complex 
mechanical-electrical work, the contracting officer may use the clause 
with its Alternate I.


836.575  Schedule of work progress.

    The contracting officer shall insert the clause at 852.236-84, 
Schedule of work progress, in solicitations and contracts for 
construction that are expected to exceed the micro-purchase threshold 
and that do not contain a section entitled ``Network Analysis System 
(NAS).''


836.576  Supplementary labor standards provisions.

    The contracting officer shall insert the clause at 852.236-85, 
Supplementary labor standards provisions, in solicitations and 
contracts for construction that are expected to exceed the micro-
purchase threshold.


836.577  Worker's compensation.

    The contracting officer shall insert the clause at 852.236-86, 
Worker's compensation, in solicitations and contracts for construction 
that are expected to exceed the micro-purchase threshold.


836.578  Contract changes--supplement.

    (a) The contracting officer shall insert the clause at 852.236-88, 
Contract changes--supplement, in solicitations and contracts for 
construction that are expected to exceed the micro-purchase threshold.
    (b) Paragraph (a) of the clause at 852.236-88 will apply to 
negotiated changes exceeding $500,000 and does not provide ceiling 
rates for indirect expenses. Such expenses will be included as part of 
the submission of certified cost or pricing data, will be negotiated by 
the contracting officer, and may be audited in accordance with FAR 
15.404-2. When the negotiated change will be $500,000 or less, 
paragraph (b) of the clause at 852.236-88 will apply.
    (c) Proposals over $500,000 shall be accompanied by certificates of 
current cost or pricing data, as provided in FAR 15.403-4. If cost or 
pricing data is required for proposals of $500,000 or less, the 
contracting officer may require that the data be certified in 
accordance with FAR 15.403-4(a)(2).
    (d) It is emphasized that the indirect cost rates in paragraph (b) 
of the clause at 852.236-88, for changes costing $500,000 or less, are 
ceiling rates only and the contracting officer must negotiate the 
indirect expense rates within the ceiling limitations. The clause is a 
result of an approved FAR deviation pursuant to subpart 801.4.


836.579  Special notes.

    The contracting officer shall insert the clause at 852.236-91, 
Special notes, in solicitations and contracts for construction that are 
expected to exceed the micro-purchase threshold.


836.602-1  [Amended]

    22. Section 836.602-1, paragraph (c) is amended by removing 
``project, and'' and adding, in its place, ``project and their''.
    23. Section 836.602-2 is amended by:
    A. In paragraph (a), removing ``Director of the Architect-Engineer 
Evaluation Staff, or the Area Project Manager (or Deputy Area Project 
Manager) will be designated to act when'' and adding, in its place, 
``Director, A/E Evaluation and Program Support Service. The Area 
Project Director or Project Manager will be designated to act as Chair 
when''; and by adding a ``comma'' immediately after ``board's 
members''.
    B. In paragraph (b), removing ``activity and'' and adding, in its 
place, ``activity (HCA) (or the senior contracting officer at the 
facility if there is no HCA on site) and''.
    C. Paragraph (c) is added.
    The addition reads as follows:


836.602-2  Evaluation boards.

* * * * *

[[Page 49338]]

    (c) The evaluation board for National Cemetery Administration (NCA) 
contracts will be appointed by the Director, Technical Support Service, 
and will consist of no less than three members, one of whom will serve 
as the board's Chair, and one of whom will be an NCA senior level 
contracting officer.


836.602-4  [Amended]

    24. Section 836.602-4 is amended by removing ``Central Office 
contracts) and'' and adding, in its place, ``Central Office contracts), 
the Deputy Under Secretary for Operations (for National Cemetery 
Administration contracts), and''.
    25. Section 836.605-5 is revised as follows:


836.602-5  Short selection process for contracts not to exceed the 
simplified acquisition threshold.

    Either of the procedures provided in FAR 36.602-5 may be used to 
select firms for architect-engineer contracts not expected to exceed 
the simplified acquisition threshold.
    26. Section 836.603 is added to read as follows:


836.603  Collecting data on and appraising firms' qualifications.

    The Chief Facilities Management Officer, Office of Facilities 
Management, for Central Office; the Director, Technical Support 
Service, for National Cemetery Administration acquisitions; and the 
Chief, Engineering Service, for field facilities, are responsible for 
collecting Standard Forms 254 and 255 and for maintaining a data file 
on architect-engineer qualifications.
    27. Section 836.606 heading is added immediately preceding 836.606-
70, to read as follows:


836.606  Negotiations.


836.606-73  [Amended]

    28. Section 836.606-73, paragraph (a)(3)(iii) is amended by adding 
a ``comma'' immediately after ``samples'.

PART 846--QUALITY ASSURANCE

    29. The authority citation for part 846 continues to read as 
follows:

    Authority: 38 U.S.C. 501 and 40 U.S.C. 486(c).


846.302-70  [Amended]

    30. Section 846.302-70 is amended by removing ``852.210-72(a)'' and 
adding, in its place, ``852.211-72(a)'', and by removing ``852.210-
72(b)'' and adding, in its place, ``852.211-72(b)''.
    31. Section 846.312 is added to read as follows:


846.312  Construction contacts.

    The contracting officer shall insert the clause at 852.236-74, 
Inspection of construction, in solicitations and contracts for 
construction that contain the FAR clause at 52.246-12, Inspection of 
Construction.
    32. Subpart 846.7, consisting of sections 846.710, 846.710-70, and 
846.710-71, is added to read as follows:
Subpart 846.7--Warranties
Sec.
846.710  Construction contracts.
846.710-70  Special warranties.
846.710-71  Warranty for construction--guarantee period services.

Subpart 846.7--Warranties


846.710  Construction contracts.

    Contracting officers shall insert the FAR clause at 52.246-21, 
Warranty of Construction, in solicitations and contracts for 
construction that are expected to exceed the micro-purchase threshold.


846.710-70  Special warranties.

    The contracting officer shall insert the clause at 852.246-1, 
Special warranties, in solicitations and contracts for construction 
that include the FAR clause at 52.246-21, Warranty for Construction.


846.710-71  Warranty for construction-- guarantee period services.

    The contracting office shall insert the clause at 852.246-2, 
Warranty for construction--guarantee period services, in solicitations 
and contracts for construction that include the FAR clause at 52.246-
21, Warranty for Construction, and also include guarantee period 
services.

PART 852--SOLICITATION PROVISIONS AND CONTRACT CLAUSES

    33. The authority citation for part 852 continues to read as 
follows:

    Authority: 38 U.S.C. 501 and 40 U.S.C. 486(c).


852.236-70  [Redesignated as 836.500]

    34. Section 852.236-70 is amended by:
    A. Redesignating section 852.236-70 as section 836.500 and 
transferring newly designated section 836.500 to subpart 836.5.
    B. In paragraph (a) of new section 836.500, removing ``section'' 
and adding, in its place, ``subpart''.
    C. Revising the new section heading.
    The revision reads as follows:


836.500  Scope of subpart.

    35. Section 852.236-71 is amended by:
    A. Revising the section introductory text.
    B. Revising the date in the undesignated center heading clause.
    C. In paragraph (d) of the clause, removing the ``comma'' 
immediately after ``work''.
    D. Adding introductory text to the clause.
    The revisions and addition read as follows:


852.236-71  Specifications and drawings for construction.

    As prescribed in 836.521, insert the following clause:

Specifications and Drawings for Construction

    The clause entitled ``Specifications and Drawings for 
Construction'' in FAR 52.236-21 is supplemented as follows:
* * * * *
    36.-37. Section 852.236-72 is amended by:
    A. Revising the section introductory text.
    B. Revising the date in the undesignated center heading clause.
    C. Adding introductory text to the clause.
    D. Revising paragraphs (b) and (d).
    E. Revising the introductory Alternate I paragraph and paragraph 
(c) of Alternate I.
    The revisions and addition read as follows:


852.236-72  Performance of work by the contractor.

    As prescribed in 836.501, insert the following clause:

Performance of Work by The Contractor (00/2001)

    The clause entitled ``Performance of Work by the Contractor'' in 
FAR 52.236-1 is supplemented as follows:
* * * * *
    (b) The contractor shall submit, simultaneously with the 
schedule of costs required by the Payments Under Fixed-Price 
Construction Contracts clause of the contract, a statement 
designating the branch or branches of contract work to be performed 
with his/her forces. The approved schedule of costs will be used in 
determining the value of a branch or branches, or portions thereof, 
of the work for the purpose of this article.
* * * * *
    (d) In the event the contractor fails or refuses to meet the 
requirement of the FAR clause at 52.236-1, it is expressly agreed 
that the contract price will be reduced by 15 percent of the value 
of that portion of the percentage requirement that is accomplished 
by others. For the purpose of this clause, it is agreed that 15 
percent is an acceptable estimate of the contractor's overhead and 
profit, or mark-up, on that portion of the work which the contractor 
fails or refuses to perform, with his/her own forces, in

[[Page 49339]]

accordance with the FAR clause at 52.236-1.

(End of clause)

    Alternate I (00/2001). For requirements which include Network 
Analysis System (NAS), substitute the following paragraphs (b) and 
(c) for paragraphs (b) and (c) of the basic clause:
* * * * *
    (c) If, during progress of work hereunder, the contractor 
requests a change in activities of work to be performed by the 
contractor's forces and the contracting officer determines it to be 
in the best interest of the Government, the contracting officer may, 
at his or her discretion, authorize a change in such activities of 
said work.

    38. Section 852.236-74 is amended by:
    A. Revising the section introductory text.
    B. Revising the date in the undesignated center heading clause.
    C. Adding introductory text to the clause.
    The revisions and addition read as follows:


852.236-74  Inspection of construction.

    As prescribed in 846.312, insert the following clause:

Inspection of Construction (00/2001)

    The clause entitled ``Inspection of Construction'' in FAR 
52.246-12 is supplemented as follows:
* * * * *


852.236-75  [Redesignated as 852.246-2]

    39. Section 852.236-75 is redesignated as 852.246-2, and is revised 
to read as follows:


852.246-2  Warranty for construction--guarantee period services.

    As prescribed in 846.710-71, insert the following clause:

Warranty for Construction--Guarantee Period Services (00/2001)

    The clause entitled ``Warranty of Construction'' in FAR 52.246-
21 is supplemented as follows:
    Should the contractor fail to prosecute the work or fail to 
proceed promptly to provide guarantee period services after 
notification by the contracting officer, the Government may, subject 
to the default clause contained at FAR Section 52.249-10, Default 
(Fixed-Price Construction), and after allowing the contractor 10 
days to correct and comply with the contract, terminate the right to 
proceed with the work (or the separable part of the work) that has 
been delayed or unsatisfactorily performed. In this event, the 
Government may take over the work and complete it by contract or 
otherwise, and may take possession of and use any materials, 
appliance, and plant on the work site necessary for completing the 
work. The contractor and its sureties shall be liable for any 
damages to the Government resulting from the contractor's refusal or 
failure to complete the work within this specified time, whether or 
not the contractor's right to proceed with the work is terminated. 
This liability includes any increased costs incurred by the 
Government in completing the work.

(End of clause)

    40. In section 852.236-76, introductory text is added to read as 
follows:


852.236-76  Correspondence.

    As prescribed in 836.570, insert the following clause:
* * * * *
    41. Section 852.236-77 is amended by:
    A. Adding introductory text.
    B. Revising the undesignated center heading clause and its date.
    The addition and revision read as follows:


852.236-77  Reference to ``standards.''

    As prescribed in 836.571, insert the following clause:

Reference To ``Standards'' (00/2001)

* * * * *
    42. In section 852.236-78, paragraph (c) is amended by removing 
``may by written direction make'' and adding, in it place ``may, by 
written direction, make''; and a section introductory text is added to 
read as follows:


852.236-78  Government supervision.

    As prescribed in 836.572, insert the following clause:
* * * * *
    43. In section 852.236-79, section introductory text is added to 
read as follows:


852.236-79  Daily report of workers and materials.

    As prescribed in 836.573, insert the following clause:
* * * * *
    44. Section 852.236-80 is amended by:
    A. Revising the introductory text.
    B. Adding a new paragraph immediately following the phrase ``(End 
of clause)''.
    The revision and addition read as follows:


852.236-80  Subcontracts and work coordination.

    As prescribed in 836.574, insert the following clause:
* * * * *

(End of clause)

    Alternate I (00/2001). For new construction work with complex 
mechanical-electrical work, the following paragraph relating to work 
coordination may be substituted for paragraph (b) of the basic clause:
* * * * *
    45. Section 852.236-81 is amended by:
    A. Removing the section introductory text.
    B. Removing the undesignated center clause heading.
    C. Adding a paragraph ``(b)'' designation to the undesignated 
clause paragraph.
    D. Removing the phrase ``(End of clause)'' at the end of the newly 
designated paragraph (b).
    E. Transferring the newly designated paragraph (b) to section 
852.236.80 immediately following the ``Alternate I'' paragraph.
    F. Removing section 852.236-81 section heading.
    46.-47. In section 852.236-82, the introductory text and paragraphs 
(b)(2) and (b)(3) are revised; the ``Supplement I (Jan 1988)'' clause 
is removed and an alternate I clause is inserted in its place to read 
as follows:


852.236.82  Payments under fixed-price construction contracts (without 
NAS).

    As prescribed in 832.111, insert the following clause in contracts 
that do not contain a section entitled ``Network Analysis System 
(NAS)'':
* * * * *
    (b) * * *

    (2) Costs as shown on this schedule must be true costs and, 
should the resident engineer so desire, he/she may require the 
contractor to submit the original estimate sheets or other 
information to substantiate the detailed makeup of the schedule.
    (3) The sum of the subbranches, as applied to each branch, shall 
equal the total cost of such branch. The total cost of all branches 
shall equal the contract price.
* * * * *
    Alternate I (00/2001). If the specifications include guarantee 
period services, the contracting officer shall include the following 
paragraphs as additions to paragraph (b) of the basic clause:
    (6)(i) The contractor shall at the time of contract award 
furnish the total cost of the guarantee period services in 
accordance with specification section(s) covering guarantee period 
services. The contractor shall submit, within 15 calendar days of 
receipt of the notice to proceed, a guarantee period performance 
program which shall include an itemized accounting of the number of 
work-hours required to perform the guarantee period service on each 
piece of equipment. The contractor shall also submit the established 
salary costs, including employee fringe benefits, and what the 
contractor reasonably expects to pay over the guarantee period, all 
of which will be subject to the contracting officer's approval.
    (ii) The cost of the guarantee period service shall be prorated 
on an annual basis and paid

[[Page 49340]]

in equal monthly payments by VA during the period of guarantee. In 
the event the installer does not perform satisfactorily during this 
period, all payments may be withheld, and the contracting officer 
shall inform the contractor of the unsatisfactory performance, 
allowing the contractor 10 days to correct deficiencies and comply 
with the contract. The guarantee period service is subject to those 
provisions as set forth in the Payments and Default clauses.

    48. Section 852.236-83 is amended by:
    A. Revising the section introductory text.
    B. Revising the date in the undesignated center heading clause.
    C. Revising the clause introductory text.
    D. Removing the ``Supplement I (JAN 1988)'' introductory text and 
inserting in its place an Alternate I paragraph, and revising 
paragraphs (6)(ii) and (iii).
    The revisions and additions read as follows:


852.236.83  Payments under fixed-price construction contracts 
(including NAS).

    As prescribed in 832.111, insert the following clause in contracts 
that contain a section entitled ``Network Analysis System (NAS)'':

Payments Under Fixed-Price Construction Contracts(00/2001)

    The clause entitled ``Payments Under Fixed-Price Construction 
Contracts'' in FAR 52.232-5 is implemented as follows:
* * * * *
(End of clause)

    Alternate I (00/2001). If the specifications include guarantee 
period services, the contracting officer shall include the following 
paragraphs as additions to paragraph (b) of the basic clause:
    (6)(i) * * *
    (ii) The contractor shall submit with the CPM a guarantee period 
performance program which shall include an itemized accounting of 
the number of work-hours required to perform the guarantee period 
service on each piece of equipment. The contractor shall also submit 
the established salary costs, including employee fringe benefits, 
and what the contractor reasonably expects to pay over the guarantee 
period, all of which will be subject to the contracting officer's 
approval.
    (iii) The cost of the guarantee period service shall be prorated 
on an annual basis and paid in equal monthly payments by VA during 
the period of guarantee. In the event the installer does not perform 
satisfactorily during this period, all payments may be withheld and 
the contracting officer shall inform the contractor of the 
unsatisfactory performance, allowing the contractor 10 days to 
correct and comply with the contract. The guarantee period service 
is subject to those provisions as set forth in the Payments and 
Default clauses.


852.236-84  [Amended]

    49. In section 852.236-84, the introductory text is revised to read 
as follows:


852.236-84  Schedule of work progress.

    As prescribed in 836.575, insert the following clause:
* * * * *
    50. In section 852.236-85, introductory text is added to read as 
follows:


852.236.85  Supplementary labor standards provisions.

    As prescribed in 836.576, insert the following clause:
* * * * *
    51. Section 852.236-86 is revised to read as follows:


852.236-86  Worker's compensation.

    As prescribed in 836.577, insert the following clause:

Worker's Compensation (00/2001)

    The Act of June 25, 1936, 49 Stat. 1938 (40 U.S.C. 290) 
authorizes the constituted authority of States to apply their 
worker's compensation laws to all lands and premises owned or held 
by the United States.

(End of clause)

    52.-53. Section 852.236-88 is amended by:
    A. Revising the section heading and introductory text.
    B. Removing paragraph (a) of the section.
    C. Revising the first clause undesignated center heading.
    D. Redesignating paragraphs (a) through (d) of the first clause as 
paragraphs (a)(1) through (a)(4), respectively.
    E. Adding a new paragraph (a) introductory text to the first 
clause.
    F. Removing from newly designated paragraph (a)(1) ``to be 
submitted'' and adding, in it place, ``to be submitted as expeditiously 
as possible but''.
    G. Removing from newly designated paragraph (a)(2) ``submit a 
proposal'' and adding, in its place, ``submit a proposal, which 
includes the information required by paragraph (a)(1),''.
    H. Removing from newly designated paragraph (a)(3) the comma 
immediately following the phrase ``the contract'', and the comma 
immediately following the phrase ``calendar days''.
    I. Removing at end of the first clause the parenthetical ``(End of 
clause)''.
    J. Removing paragraph (b) of the section.
    K. Removing the second clause introductory text immediately 
following the second undesignated center clause heading.
    L. Redesignating paragraphs (a) through (k) of the second clause as 
paragraphs (b)(1) through (b)(11), respectively.
    M. Adding a new clause paragraph (b) introductory text.
    N. Removing from newly designated paragraph (b)(1) ``to be 
submitted'' and adding, in its place, ``to be submitted as 
expeditiously as possible but''; and removing ``data are required under 
FAR 15.403 for proposals over $100,000, the cost of pricing'' and 
adding, in its place, ``data or information other than cost or pricing 
data are required under FAR 15.403, the''.
    O. Removing from newly designated paragraph (b)(2) ``submit a 
proposal for cost of changes in work within 30 calendar days.'' and 
adding, in its place, ``submit with 30 calendar days a proposal, which 
includes the information required by paragraph (b)(1), for the cost of 
the changes in work.''
    P. Removing from newly designated paragraph (b)(3) the comma 
immediately following the phrase ``the contract'', and the comma 
immediately following the phrase ``calendar days''.
    Q. Removing from newly designated paragraph (b)(9) ``Workmen's'' 
and adding, in its place, ``Worker's'.
    R. Removing the second clause undesignated center heading.
    The revisions and additions read as follows:


852.236-88  Contract changes--supplement.

    As prescribed in 836.578, insert the following clause:

Contract Changes--Supplement (00/2001)

* * * * *
    (a) Paragraphs (a)(1) through (a)(4) apply to proposed contract 
changes costing over $500,000:
* * * * *
    (b) Paragraphs (b)(1) through (b)(11) apply to proposed contract 
changes costing $500,000 or less:
* * * * *


852.236-89  [Amended]

    54. Section 852.236-89 is revised to read as follows:


852.236-89  Buy American Act.

    As prescribed in 825.1102, insert the following clause:

Buy American Act (00/2001)

    (a) Reference is made to the clause entitled ``Buy American 
Act--Balance of Payments Program--Construction Materials,'' FAR 
52.225-9.
    (b) Notwithstanding a bidder's right to offer identifiable 
foreign construction material in its bid pursuant to FAR 52.225-9, 
VA does not anticipate accepting an offer that includes foreign 
construction material.

[[Page 49341]]

    (c) If a bidder chooses to submit a bid that includes foreign 
construction material, that bidder must provide a listing of the 
specific foreign construction material he/she intends to use and a 
price for said material. Bidders must include bid prices for 
comparable domestic construction material. If VA determines not to 
accept foreign construction material and no comparable domestic 
construction material is provided, the entire bid will be rejected.
    (d) Any foreign construction material proposed after award will 
be rejected unless the bidder proves to VA's satisfaction: (1) It 
was impossible to request the exemption prior to award, and (2) said 
domestic construction material is no longer available, or (3) where 
the price has escalated so dramatically after the contract has been 
awarded that it would be unconscionable to require performance at 
that price. The determinations required by (1), (2), and (3) of this 
paragraph shall be made in accordance with subpart 825.2 and FAR 
25.2.
    (e) By signing this bid, the bidder declares that all articles, 
materials and supplies for use on the project shall be domestic 
unless specifically set forth on the Bid Form or addendum thereto.

(End of Cause)

    Alternate I (00/2001). As prescribed in 825.1102(b), substitute 
the following paragraphs for paragraphs (a) and (b) of the basic 
clause:
    (a) Reference is made to the clause entitled ``Buy American 
Act--Balance of Payment Program--Construction Materials Under Trade 
Agreements,'' FAR 52.225-11.
    (b) The restrictions contained in this clause 852.236-89 are 
waived for North American Free Trade Agreement (NAFTA) country 
construction material, as defined in FAR 52.225-11. Notwithstanding 
a bidder's right to offer identifiable foreign construction material 
in its bid pursuant to FAR 52.225-11, VA does not anticipate 
accepting an offer that includes foreign construction material, 
other than NAFTA country construction material.
    Alternate II (00/2001). As prescribed in 825.1102(c), substitute 
the following paragraphs for paragraphs (a) and (b) of the basic 
clause:
    (a) Reference is made to the clause entitled ``Buy American 
Act--Balance of Payment Program--Construction Materials Under Trade 
Agreements,'' FAR 52.225-11.
    (b) The restrictions contained in this clause 852.236-89 are 
waived for designated country and North American Free Trade 
Agreement (NAFTA) country construction material, as defined in FAR 
52.225-11. Notwithstanding a bidder's right to offer identifiable 
foreign construction material in its bid pursuant to FAR 52.225-11, 
VA does not anticipate accepting an offer that includes foreign 
construction material, other than designated country or NAFTA 
country construction material.

    55. Section 852.236-91 is amended by:
    A. Adding an introductory text to the section.
    B. Revising the undesignated center clause heading and its date.
    C. Revising paragraph (a) introductory text.
    D. In paragraph (b), adding a ``comma'' immediately following the 
phrase ``is permitted'.
    The additions and revisions read as follows:


852.236-91  Special notes.

    As prescribed in 836.579, insert the following clause:

Special Notes (00/2001)

    (a) Signing of the bid shall be deemed to be a representation by 
the bidder that:
* * * * *
    56. Section 852.246-1 is added to read as follows:


852.246-1  Special warranties.

    As prescribed in 846.710-70, insert the following clause:

Special Warranties (00/2001)

    The clause entitled ``Warranty of Construction'' in FAR 52.246-
21 is supplemented as follows:
    Any special warranties that may be required under the contract 
shall be subject to the elections set forth in the FAR clause at 
52.246-21, Warranty of Construction, unless otherwise provided for 
in such special warranties.

(End of clause)
[FR Doc. 01-23772 Filed 9-26-01; 8:45 am]
BILLING CODE 8320-01-P