[Federal Register Volume 67, Number 45 (Thursday, March 7, 2002)]
[Rules and Regulations]
[Pages 10528-10529]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 02-5385]



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Part III





Department of Defense

General Services Administration

National Aeronautics and Space Administration





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48 CFR Chapter 1 and Parts 17, et al.



Federal Acquisition Regulations; Final Rule

  Federal Register / Vol. 67, No. 45 / Thursday, March 7, 2002 / Rules 
and Regulations  

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DEPARTMENT OF DEFENSE

GENERAL SERVICES ADMINISTRATION

NATIONAL AERONAUTICS AND SPACE ADMINISTRATION

48 CFR Parts 17, 22, and 36

[FAC 2001-05; FAR Case 2001-016 (stay)]
RIN 9000-AJ14


Federal Acquisition Regulation; Executive Order 13202, 
Preservation of Open Competition and Government Neutrality Towards 
Government Contractors' Labor Relations on Federal and Federally Funded 
Construction Projects

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

ACTION: Interim rule; stay with request for comments.

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SUMMARY: The Civilian Agency Acquisition Council and the Defense 
Acquisition Regulations Council (Councils) published an interim rule in 
the Federal Register at 66 FR 27414, May 16, 2001, implementing 
Executive Order 13202, Preservation of Open Competition and Government 
Neutrality Towards Government Contractors' Labor Relations on Federal 
and Federally Funded Construction Projects, which prohibits including 
requirements for affiliation with a labor organization as a condition 
for award of any contract or subcontract for construction or 
construction management services. Executive Order 13202, as amended, is 
currently the subject of litigation in the Federal courts, and an 
appeal is pending in the United States Court of Appeals for the 
District of Columbia Circuit. Pending resolution of this litigation, 
the Councils are now issuing a stay of a paragraph of the rule. After 
final judicial resolution of the dispute, the Councils will, as 
appropriate, issue a notice regarding the status of the rule. The 
Councils request comments on this action.

DATES: Effective Date: Effective March 7, 2002 paragraph 36.202(d) of 
the interim rule published in the Federal Register at 66 FR 27414, May 
16, 2001, is stayed indefinitely.
    Comment Date: Interested parties must submit comments to the FAR 
Secretariat at the address shown below on or before May 6, 2002 to be 
considered in the formulation of a rule concerning the stay and the 
length of the stay.

ADDRESSES: Submit written comments to: General Services Administration, 
FAR Secretariat (MVP), 1800 F Street, NW, Room 4035, Attn: Ms. Laurie 
Duarte, Washington, DC 20405.
    Submit electronic comments via the Internet to: [email protected]. Please submit comments only and cite FAC 2001-05, FAR 
case 2001-016 (stay), in all correspondence related to this case.

FOR FURTHER INFORMATION CONTACT: The FAR Secretariat, Room 4035, GS 
Building, Washington, DC 20405, (202) 501-4755, for information 
pertaining to status or publication schedules. For clarification of 
content, contact Ms. Linda Nelson, Procurement Analyst, at (202) 501-
1900. Please cite FAC 2001-05, FAR case 2001-016 (stay).

SUPPLEMENTARY INFORMATION:

A. Background

    On February 17, 2001, President George W. Bush signed Executive 
Order 13202 revoking Executive Order 12836 of February 1, 1993, and 
Presidential Memorandum of June 5, 1997, entitled ``Use of Project 
Labor Agreements for Federal Construction Projects.'' The Executive 
order was published in the Federal Register at 66 FR 11225, February 
22, 2001, and was amended by Executive Order 13208, which was published 
in the Federal Register at 66 FR 18717, April 11, 2001. Executive Order 
13202, as amended, is intended to improve the internal management of 
the Executive branch by--
     Promoting and ensuring open competition on Federal and 
federally funded or assisted construction projects;
     Maintaining Government neutrality towards Government 
contractors' labor relations on Federal and federally funded or 
assisted construction projects;
     Reducing construction costs to the Government and to the 
taxpayers;
     Expanding job opportunities, especially for small and 
disadvantaged businesses;
     Preventing discrimination against Government contractors 
or their employees based upon labor affiliation or lack thereof, 
thereby promoting the economical, nondiscriminatory, and efficient 
administration and completion of Federal and federally funded or 
assisted construction projects; and
     Preventing the inefficiency that may result from the 
disruption of a previously established contractual relationship in 
particular cases.
    To implement Executive Order 13202, as amended, an interim rule was 
published in the Federal Register on May 16, 2001, 66 FR 27414, as Item 
II of FAC 97-26. Consistent with Executive Order 13202, as amended, FAR 
36.202(d) of that interim rule specified that agencies could not 
require or prohibit offerors, contractors, or subcontractors from 
entering into or adhering to agreements with one or more labor 
organizations. It also permitted agency heads to exempt a project from 
the requirements of the Executive order under special circumstances, 
but specified that such an exemption could not be related to a possible 
or an actual labor dispute. FAR 36.202(d) also provided for the 
exemption of a project governed by a project labor agreement in place 
as of February 17, 2001, which had a construction contract awarded as 
of February 17, 2001.
    Public comments were received from 179 respondents.
    Executive Order 13202, as amended, is currently the subject of 
litigation in the Federal courts, and an appeal is pending in the 
United States Court of Appeals for the District of Columbia Circuit. 
Building and Construction Trades Department, AFL-CIO v. Allbaugh, 172 
F.Supp. 2d 138 (D.D.C. 2001), appeal pending, No. 01-5436 (D.C. Cir.).
    Based on guidance received from the Administrator of the Office of 
Federal Procurement Policy, Office of Management and Budget, the 
Councils are issuing this notice staying FAR 36.202(d), pending 
resolution of the litigation. After final judicial resolution of the 
dispute, the Councils will, as appropriate, issue a notice regarding 
the status of FAR 36.202(d).
    This is not a significant regulatory action and, therefore, was not 
subject to 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 Department of Defense, the General Services Administration, and 
the National Aeronautics and Space Administration believe that this 
stay may 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 the action stays a rule that would have 
assisted in expanding job opportunities for small and small 
disadvantaged businesses in Federal construction projects. Therefore, 
we have prepared an Initial Regulatory Flexibility Analysis:

    Description of the reasons why action by the agency is being 
considered: An interim rule was published in the Federal Register on 
May 16, 2001, 66 FR 27414, as Item II of

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FAC 97-26. That interim rule amended the FAR to implement Executive 
Order 13202, as amended. Consistent with the Executive Order, FAR 
36.202(d) provides that agencies may not require or prohibit 
offerors, contractors, or subcontractors from entering into or 
adhering to agreements with one or more labor organizations. It also 
permits agency heads to exempt a project from these requirements 
under special circumstances, as long as the exemption is not related 
to the possibility of or an actual labor dispute. FAR 36.202(d) also 
allows for exemption of a project governed by a project labor 
agreement in place as of February 17, 2001, which had a construction 
contract awarded as of February 17, 2001. Public comments were 
received from 179 respondents. There were no public comments 
received in response to the Initial Regulatory Flexibility Analysis.
    Executive Order 13202, as amended, is currently the subject of 
litigation in the Federal courts, and an appeal is pending in the 
United States Court of Appeals for the District of Columbia Circuit. 
See Building and Construction Trades Department, AFL-CIO v. 
Allbaugh, 172 F.Supp. 2d 138 (D.D.C. 2001), appeal pending, No. 01-
5436 (D.C. Cir.). Based on guidance received from the Administrator 
of the Office of Federal Procurement Policy, Office of Management 
and Budget, the Councils are staying FAR 36.202(d) pending 
resolution of the litigation. After final judicial resolution of the 
dispute, the Councils will, as appropriate, issue a notice regarding 
the status of FAR 36.202(d).
    Succinct statement of the objectives of, and legal basis for, 
the interim rule stay: This action stays FAR 36.202(d), which 
implemented Executive Order 13202, as amended, pending judicial 
resolution of litigation related to the Executive Order.
    Description of, and where feasible, estimate of the number of 
small entities to which the interim rule stay will apply: The stay 
applies to all large and small entities that seek construction 
contracts that are awarded by executive agencies. For fiscal year 
2001, through the third quarter, there were 1,143 construction 
contract actions awarded. It is not known how many were union or 
nonunion. The interim rule published as Item II of FAC 97-26 had an 
Initial Regulatory Flexibility Act statement that said it was likely 
to have an economic impact on entities that had nonunion shops 
because it would have provided additional work opportunities.
    Description of projected reporting, recordkeeping, and other 
compliance requirements of the interim rule stay, including an 
estimate of the classes of small entities that will be subject to 
the requirement and the type of professional skills necessary for 
preparation of the report or record: The interim rule stay imposes 
no reporting, recordkeeping, or other compliance requirements.
    Identification, to the extent practicable, of all relevant 
Federal rules that may duplicate, overlap, or conflict with the 
interim rule stay: The interim rule stay does not duplicate, 
overlap, or conflict with any other Federal rules.
    Description of any significant alternatives to the interim rule 
stay that accomplish the stated objectives of applicable statutes 
and that minimize any significant economic impact of the interim 
rule stay on small entities: There are no practical alternatives 
that will accomplish the objectives of this stay.

    We invite comments from small businesses and other interested 
parties. We will consider comments from small entities concerning the 
affected FAR Parts 17, 22, and 36 in accordance with 5 U.S.C. 610. 
Small entities must submit such comments separately and should cite 5 
U.S.C. 601, et seq. (FAC 2001-05, FAR Case 2001-016 (stay)), in 
correspondence.

C. Paperwork Reduction Act

    The Paperwork Reduction Act does not apply because the interim stay 
does not impose or remove information collection requirements that 
require the approval of the Office of Management and Budget under 44 
U.S.C. 3501, et seq.

D. Determination To Issue an Interim Stay

    A determination has been made under the authority of the Secretary 
of Defense (DoD), the Administrator of General Services (GSA), and the 
Administrator of the National Aeronautics and Space Administration 
(NASA) that urgent and compelling reasons exist to promulgate this 
interim stay without prior opportunity for public comment. This action 
is necessary because Executive Order 13202, as amended, which FAR 
36.202(d) implements, is currently the subject of litigation in the 
Federal courts, and an appeal is pending in the United States Court of 
Appeals for the District of Columbia Circuit. However, pursuant to 
Public Law 98-577 and FAR 1.501, public comments received in response 
to this interim rule stay will be considered in formulating a final 
rule.

List of Subjects in 48 CFR Parts 17, 22, and 36

    Government procurement.

    Dated: March 1, 2002.
Al Matera,
Director, Acquisition Policy Division.

Federal Acquisition Circular

    Federal Acquisition Circular (FAC) 2001-05 is issued under the 
authority of the Secretary of Defense, the Administrator of General 
Services, and the Administrator for the National Aeronautics and 
Space Administration.
    Unless otherwise specified, all Federal Acquisition Regulation 
(FAR) and other directive material contained in FAC 2001-05 are 
effective March 7, 2002.

    Dated: February 28, 2002.

Deidre A. Lee,
Director, Defense Procurement.

    Dated: February 27, 2002.

David A. Drabkin,
Deputy Associate Administrator, Office of Acquisition Policy, 
General Services Administration.

    Dated: February 27, 2002.

Anne Guenther,
Acting Assistant Administrator for Procurement, National Aeronautics 
and Space Administration.

    Accordingly, paragraph 36.202(d) of the interim rule amending 48 
CFR parts 17, 22, and 36, which was published on May 16, 2001 in the 
Federal Register at 66 FR 27414 as Item II of FAC 97-26, is stayed 
indefinitely.

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

[FR Doc. 02-5385 Filed 3-6-02; 8:45 am]
BILLING CODE 6820-EP-P