[Federal Register Volume 68, Number 15 (Thursday, January 23, 2003)]
[Proposed Rules]
[Pages 3220-3225]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 03-1536]


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GENERAL SERVICES ADMINISTRATION

48 CFR Parts 532, 538, and 552

[GSAR Case No. 2002-G505]
RIN 3090-AH76


General Services Administration Acquisition Regulation; Federal 
Supply Schedule Contracts--Acquisition of Information Technology by 
State and Local Governments Through Federal Supply Schedules

AGENCY: Office of Acquisition Policy, General Services Administration 
(GSA).

ACTION: Proposed rule with request for comments; notice of public 
meeting.

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SUMMARY: The General Services Administration (GSA) is proposing to 
amend the General Services Administration Acquisition Regulation (GSAR) 
to implement section 211 of the E-Government Act of 2002. Section 211 
authorizes the Administrator of GSA to provide for the use by States or 
local governments of its federal supply schedule for ``automated data 
processing equipment (including firmware), software, supplies, support 
equipment, and services (as contained in Federal supply classification 
code group 70).'' To facilitate an open dialogue between the Government 
and interested parties on the implementation of section 211, GSA will 
hold a public meeting on the proposed GSAR rule on February 4, 2003.

DATES: Comment Date: Interested parties should submit comments to the 
Regulatory Secretariat at the address shown below on or before March 
24, 2003, to be considered in the formulation of a final rule.
    Public Meeting: A public meeting will be conducted at the address 
shown below starting at 10 a.m. to 12 p.m., local time, on February 4, 
2003, to ensure an open dialogue between the government and interested 
parties on the proposed rule.

ADDRESSES: Submit written comments to--General Services Administration, 
Regulatory Secretariat (MVA), 1800 F Street, NW., Room 4035, Attn: Ms. 
Laurie Duarte, Washington, DC 20405.
    Submit electronic comments via the Internet to--GSARcase.2002-
[email protected]
    Please submit comments only and cite 2002-G505 in all 
correspondence related to this case.
    Public Meeting: The location of the public meeting will be at the 
GSA Auditorium, 1800 F Street, NW., Washington, DC 20405.
    If you wish to attend the meeting and/or make presentations on the 
proposed rule, please contact and submit a copy of your presentation by 
January 28, 2003, to--General Services Administration, Acquisition 
Policy Division (MVP), 1800 F Street, NW., Room 4033, Attn: Beverly 
Cromer, Washington, DC 20405. Telephone: (202) 208-6750.
    Submit electronic materials via the Internet to--meeting.2002-
[email protected]
    Please submit presentations only and cite Public Meeting 2002-G505 
in all correspondence related to this public meeting. The submitted 
presentations will be the only record of the public meeting. If you 
intend to have your presentation considered as a public comment on the 
proposed rule, the presentation must be submitted separately as a 
public comment as instructed above.

FOR FURTHER INFORMATION CONTACT: The Regulatory Secretariat, Room 4035, 
GS Building, Washington, DC, 20405, (202) 501-4225, for information 
pertaining to status or publication schedules. For clarification of 
content, contact Ms. Beverly Cromer, Procurement Analyst, at (202) 208-
6750. Please cite GSAR case 2002-G505.

SUPPLEMENTARY INFORMATION: 

A. Background

    The Federal Supply Schedule Program, which is directed and managed 
by GSA, is designed to provide Federal agencies with a simplified 
process of acquiring commonly used commercial supplies and services at 
prices associated with volume buying. Ordering activities conduct 
streamlined competitions among a number of schedule contractors, issue 
orders directly with the selected contractor, and administer orders.
    Section 211 of the E-Government Act of 2002 (Pub. L. 107-347) 
amends the Federal Property and Administrative Services Act to allow 
for ``cooperative purchasing,'' where the Administrator of GSA provides 
States and localities access to certain items offered through GSA's 
supply schedules. Specifically, section 211 amends 40 U.S.C. 502 by 
adding a new subsection ``(c)'' that allows, to the extent authorized 
by the Administrator, a State or local government to use ``Federal 
supply schedules of the General Services Administration for automated 
data processing equipment (ADPE)(including firmware), software, 
supplies, support equipment, and services (as contained in Federal 
supply classification code group 70).'' ``State or local government'' 
includes any State, local, regional, or tribal government, or any 
instrumentality thereof (including any local educational agency or 
institution of higher education).
    The proposed rule would establish a new GSAR subpart 538.70 and 
associated clauses to address cooperative purchasing from supply 
schedules by eligible non-federal organizations. Among other things, 
the rule would define the scope of cooperative purchasing, its usage, 
and applicable terms and conditions, including payment and the handling 
of disputes.
    Limited scope. Because the law specifies that schedule access 
applies to offerings ``contained in Federal supply classification code 
group 70,'' the proposed GSAR changes would limit state and local 
purchases to the GSA's Schedule 70 contracts. The rule would not 
authorize access to ADPE available through GSA schedules other than 
Schedule 70. In addition, the rule would not apply, nor otherwise 
affect, supply schedules operated by the Department of Veterans Affairs 
under a delegation provided by GSA.
    Voluntary use. The authority provided in this rule would be 
available for use on a voluntary (i.e., non-mandatory) basis. In other 
words, businesses with Schedule 70 contracts would have the option of 
deciding whether they will accept orders placed by State or local 
government buyers. Existing Schedule 70 contracts would be modified by 
mutual agreement of the parties. Even after an existing contract has 
been modified, a schedule contractor would retain the right to decline 
orders by State or local government buyers on a case-by-case basis. 
Future schedule contractors would also be able to decline orders on a 
case-by-case basis. (Schedule contractors would be able to decline to 
accept any order, for any reason, within a 5-day period of receipt of 
the order.) Similarly, the rule would place no obligation on State and 
local government buyers. They would have full discretion to decide if 
they wish to make a supply schedule purchase, subject, however, to any 
limitations that may be established under local law and procedures.

[[Page 3221]]

    Defined terms and conditions. Under proposed GSAR clause 552.238-
79, which would be incorporated into covered schedule contracts of 
participating contractors, a new contract would be formed when the 
schedule contractor accepted an order from a State or locality. 
However, with certain exceptions provided in this rule, terms and 
conditions of the underlying schedule contract would be incorporated by 
reference into the new contract between the State or locality and the 
contractor. Buyers would not be permitted to place additional 
requirements on schedule contractors.
    With respect to payment, proposed GSAR clause 552.232-81 would 
provide that the terms and conditions of a State's prompt payment law 
apply to orders placed by eligible non-federal ordering activities. If 
the ordering activity is not otherwise subject to a State prompt 
payment law, the activity would be covered by the Federal Prompt 
Payment Act, 31 U.S.C. 3901, et seq., as implemented in the FAR (see 
subpart 32.9), in the same manner as Federal ordering activities.
    The Federal government would not be liable for the performance or 
nonperformance of contracts established under the authority of this 
rule between schedule contractors and eligible non-federal entities. 
Disputes that could not be resolved by the parties to the new contract 
could be litigated in any State or Federal court with jurisdiction over 
the parties, using principles of Federal procurement law and the 
Uniform Commercial Code, as applicable and appropriate.
    The prices of supplies and services available on schedule contracts 
include an administrative fee. The fee covers the administrative costs 
incurred by GSA to operate the Schedules program. The fee is 
periodically adjusted as necessary to recover the cost of operating the 
program.
    Interested parties are encouraged to attend a public meeting that 
will be held on February 4, 2003, to discuss the contents of the 
proposed GSAR rule and other ideas regarding the implementation of 
section 211. GSA is developing a training plan to help acclimate 
parties with cooperative purchasing. Additional non-regulatory guidance 
will also be developed as necessary.
    Finally, GSA intends to track the level of cooperative purchasing, 
including participation by small business schedule contractors. It will 
also monitor the effect of cooperative purchasing on Federal 
purchasing, including any changes in access for Federal customers and 
the impact on GSA's ability to negotiate favorable pricing and terms 
and conditions.
    As required by section 211(c) of the E-Government Act, a report 
will be submitted to Congress by December 31, 2004, on the 
implementation and effects of cooperative purchasing.
    The following statutes and Executive orders do not apply to this 
rulemaking: Unfunded Mandates Reform Act of 1995; Executive Order 
13175, Consultation and Coordination with Indian Tribal Governments; 
and Executive Order 13132, Federalism.

B. Executive Order 12866

    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.

C. Regulatory Flexibility Act

    An Initial Regulatory Flexibility Analysis (IRFA) has been prepared 
and submitted to the Chief Counsel for Advocacy of the Small Business 
Administration. Copies of the IRFA are available from the Regulatory 
Secretariat. GSA will consider comments from small entities concerning 
the affected GSAR Parts in accordance with 5 U.S.C. 610. Interested 
parties must submit such comments separately and should cite 5 U.S.C 
601, et seq. (GSAR 2002-G505), in correspondence. The IRFA indicates 
that the proposed rule will affect large and small entities including 
small businesses that are awarded Schedule 70 contracts under the GSA 
Federal supply schedule program; non-schedule contractors, including 
small businesses, contracting with State or local governments; and 
small governmental jurisdictions that will be eligible to place orders 
under Schedule 70 contracts. The analysis is as follows:

Initial Regulatory Flexibility Analysis GSAR Case 2002-G505

Federal Supply Schedule Contracts--Acquisition of Information 
Technology by State and Local Governments Through Federal Supply 
Schedules

Implementation of Section 211, Authorization for Acquisition of 
Information Technology by States and Local Governments through 
Federal Supply Schedules

    This Initial Regulatory Flexibility Analysis has been prepared 
consistent with the criteria of 5 U.S.C. 604.
    1. Description of the reasons why action by the agency is being 
considered.
    To implement section 211, Authorization for Acquisition of 
Information Technology By States and Local Governments Through 
Federal Supply Schedules, of the E-Government Act of 2002 (Pub. L. 
107-347). Section 211 amends section 502 of title 40, United States 
Code, to authorize the Administrator to provide for use by State or 
local governments of Federal Supply Schedules of the General 
Services Administration for automated data processing equipment 
(including firmware), software, supplies, support equipment, and 
services (as contained in Federal supply classification code group 
70).
    2. Succinct statement of the objectives of, and legal basis for, 
the proposed rule.
    The proposed rule will implement section 211 of the E-Government 
Act of 2002 with the objective of opening the Federal supply 
schedule 70 for use by other governmental entities to enhance 
intergovernmental cooperation. The goal of the new rule is to make 
``government'' (considering all levels) more efficient by reducing 
duplication of effort and utilizing volume purchasing techniques for 
the acquisition of IT products and services.
    3. Description of, and where feasible, estimate of the number of 
small entities to which the proposed rule will apply.
    The proposed rule will affect large and small entities including 
small businesses, that are awarded Schedule 70 contracts under the 
GSA Federal supply schedule program; non-schedule contractors, 
including small businesses, contracting with State or local 
governments; and small governmental jurisdictions that will be 
eligible to place orders under Schedule 70 contracts. Approximately 
sixty-eight percent (2,300) of GSA Schedule 70 contractors are small 
businesses. All of those small business Schedule 70 contractors will 
be allowed, at the schedule contractor's option, to accept orders 
from State and local governments. Obviously, the expanded authority 
to order from Schedule 70 contracts could increase the sales of 
small business schedule contractors. It is difficult to identify the 
number of non-schedule small businesses that currently sell directly 
to State and local governments. The ability of governmental entities 
to use Schedule 70 may affect the competitive marketplace in which 
those small businesses operate. State and local government agencies 
could realize lower prices on some products and services, less 
administrative burden and shortened procurement lead times. The rule 
does not affect or waive State or local government preference 
programs. Finally, small governmental jurisdictions will also be 
affected. The 50 states, 3139 counties, 19,365 incorporated 
municipalities, 30,386 minor subdivisions, 3,200 public housing 
authorities, 14,178 school districts, 1,625 public educational 
institutions of higher learning, and 550 Indian tribal governments 
would be among those affected if they chose to order from Schedule 
70 contracts. Federal supply schedule contracts are negotiated as 
volume purchase agreements, with generally very favorable pricing. 
The ability of small governmental entities to order from Schedule 70 
holds out the potential for significant cost savings for those 
organizations.
    4. Description of projected reporting, recordkeeping, and other 
compliance

[[Page 3222]]

requirements of the proposed rule, 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 proposed rule makes changes in certain provisions or clauses 
in order to recognize the fact that authorized non-federal ordering 
activities may place orders under the contract. The Office of 
Management and Budget under the Paperwork Reduction Act have 
previously approved these clauses and the changes do not impact the 
information collection or recordkeeping requirements.
    5. Identification, to the extent practicable, of all relevant 
Federal rules that may duplicate, overlaps or conflict with the 
proposed rule.
    The proposed rule when finalized does not duplicate, overlap, or 
conflict with any other Federal rules.
    6. Description of any significant alternatives to the proposed 
rule that accomplish the stated objectives of applicable statutes 
and that minimize any significant economic impact of the proposed 
rule on small entities.
    There are no practical alternatives that will accomplish the 
objective of this rule.

D. Paperwork Reduction Act

    The new provision at GSAR 552.232-82, Contractor's Remittance 
(Payment) Address, contains an information collection requirement that 
is subject to the Paperwork Reduction Act (44 U.S.C. 3501 et seq.). The 
provision provides for the offeror to indicate the payment address to 
which checks should be mailed for payment of invoices and provides for 
the offeror to identify participating dealers and provide their 
addresses for receiving orders and payments on behalf of the 
contractor. This information is the same as is normally required in the 
commercial world and does not represent a Government-unique information 
collection. Therefore, the estimated burden for this clause under the 
Paperwork Reduction Act is zero. GSA has a blanket approval under 
control number 3090-0250 from OMB for information collections with a 
zero burden estimate.
    The new clause at GSAR 552.232-83, Contractor's Billing 
Responsibilities, contains a recordkeeping requirement that is subject 
to the Paperwork Reduction Act (44 U.S.C. 3501 et seq.). The clause 
provides for the contractor to require all dealers participating in the 
performance of the contract to agree to maintain certain records on 
sales made under the contract on behalf of the contractor. The records 
required are the same as those normally maintained by dealers in the 
commercial world and do not represent a Government-unique record 
keeping requirement. Therefore, the estimated burden for this clause 
under the Paperwork Reduction Act is zero. GSA has a blanket approval 
under control number 3090-0250 from OMB for information collections 
with a zero burden estimate.
    The revised clause at GSAR 552.238-75, Price Reductions, contains 
an information collection requirement that is subject to the Paperwork 
Reduction Act (44 U.S.C. 3501 et seq.) that has previously been 
approved by the OMB under the Paperwork Reduction Act and assigned 
control number 3090-0235. The changes made to the clause by this rule 
do not have an impact on the information collection requirement, which 
was previously approved. Therefore, it has not been submitted to OMB 
for approval under the Act.

List of Subjects in 48 CFR Parts 532, 538, and 552

    Government procurement.

    Dated: January 16, 2003.
David A. Drabkin,
Deputy Associate Administrator, Office of Acquisition Policy.
    Therefore, GSA proposes to amend 48 CFR parts 532, 538, and 552 as 
set forth below:
    1. The authority citation for 48 CFR parts 532, 538, and 552 
continues to read as follows:

    Authority: 40 U.S.C. 486(c).

PART 532--CONTRACT FINANCING

    2. Amend section 532.206 by redesignating the existing paragraph as 
paragraph (a) and by adding paragraphs (b), (c), and (d) to read as 
follows:


532.206  Solicitation provisions and contract clauses.

    (a) * * *
    (b) The contracting officer shall insert the clause at 552.232-81, 
Payments by Non-Federal Ordering Activities, in solicitations and 
schedule contracts for Schedule 70.
    (c) The contracting officer shall insert the provision at 552.232-
82, Contractor's Remittance (Payment) Address, in solicitations and 
schedule contracts for Schedule 70.
    (d) The contracting officer shall insert the clause at 552.232-83, 
Contractor's Billing Responsibilities, in solicitations and schedule 
contracts for Schedule 70.


532.7003  [Amended]

    3. Amend section 532.7003 in paragraph (a) by removing ``Payment by 
Governmentwide Commercial Purchase Card'' and adding ``Payment by 
Credit Card'' in its place.

PART 538--FEDERAL SUPPLY SCHEDULE CONTRACTING


538.272  [Amended]

    4. Amend paragraph (a) of section 538.272 by removing 
``Government'' each time it is used (twice) and adding ``eligible 
ordering activities'' in its place.
    5. Add subpart 538.70 to read as follows:

Subpart 538.70--Cooperative Purchasing

Sec.
538.7000 Scope of subpart.
538.7001 Definitions.
538.7002 General.
538.7003 Policy.
538.7004 Solicitation provisions and contract clauses.


538.7000  Scope of subpart.

    This subpart prescribes policies and procedures that implement 
statutory provisions authorizing non-federal organizations to use 
Schedule 70 contracts.


538.7001  Definitions.

    Ordering activity (also called ``ordering agency'' and ``ordering 
office'') means an eligible ordering activity (see 552.238-78) 
authorized to place orders under Federal supply schedule contracts.
    Schedule 70, as used in this subpart, means schedule 70 contracts, 
including products under Federal Supply Classification Code 70 of the 
Federal Supply Schedule program, services under Federal Supply 
Classification Code d3 (ADP & Telecommunication Services), and support 
items under both of these codes.
    State and local government entities, as used in this subpart, means 
the States of the United States, counties, municipalities, cities, 
towns, townships, tribal governments, public authorities (including 
public or Indian housing agencies under the United States Housing Act 
of 1937), school districts, colleges and other institutions of higher 
education, council of governments (incorporated or not), regional or 
interstate government entities, or any agency or instrumentality of the 
preceding entities (including any local educational agency or 
institution of higher education), and including legislative and 
judicial departments. The term does not include contractors of, or 
grantees of, State or local governments.
    (1) Local educational agency has the meaning given that term in 
section 8013 of the Elementary and Secondary Education Act of 1965 (20 
U.S.C. 7713).

[[Page 3223]]

    (2) Institution of higher education has the meaning given that term 
in section 101(a) of the Higher Education Act of 1965 (20 U.S.C. 
1001(a)).
    (3) Tribal government means--
    (i) The governing body of any Indian tribe, band, nation, or other 
organized group or community located in the continental United States 
(excluding the State of Alaska) that is recognized as eligible for the 
special programs and services provided by the United States to Indians 
because of their status as Indians; and
    (ii) Any Alaska Native regional or village corporation established 
pursuant to the Alaska Native Claims Settlement Act (43 U.S.C. 1601 et 
seq.).


538.7002  General.

    (a) 40 U.S.C. 501, (the Act) authorizes the Administrator of 
General Services to procure and supply personal property and 
nonpersonal services for the use of Executive agencies. Under 40 U.S.C. 
502, the goods and services available to executive agencies are also 
available to mixed ownership Government corporations, establishments 
within the legislative or judicial branches of Government (excepting 
the Senate, House of Representatives, Architect of the Capitol, and any 
activities under the direction of the Architect of the Capitol), the 
District of Columbia, and Qualified Non-profit Agencies.
    (b) Section 211 of the E-Government Act of 2002 amends 40 U.S.C. 
502 to authorize the Administrator of General Services to provide for 
use of certain Federal supply schedules of the GSA by a State or local 
government, which includes any State, local, regional, or tribal 
government, or any instrumentality thereof (including any local 
educational agency or institution of higher education).
    (c) State and local governments are authorized to procure only from 
the information technology Federal supply schedule (Schedule 70) as 
follows:
    (1) Information technology products that fall under the Federal 
supply classification code group 70 (ADP equipment (including 
firmware), software, supplies and support equipment);
    (2) Services that fall under Federal Supply Classification Code d3 
(ADP and telecommunication services); and
    (3) Support items for these classifications listed in paragraphs 
(c)(1) and (c)(2) of this section.


538.7003  Policy.

    Preparing solicitations when schedules are open to eligible non-
federal entities. When opening Schedule 70 for use by eligible non-
federal entities, the contracting officer must make minor modifications 
to certain Federal Acquisition Regulation provisions and clauses in 
order to make clear distinctions between the rights and 
responsibilities of the U.S. Government in its management and 
regulatory capacity pursuant to which it awards schedule contracts and 
fulfills associated Federal requirements versus the rights and 
responsibilities of eligible ordering activities placing orders to 
fulfill agency needs. Accordingly, the contracting officer is 
authorized to modify the following FAR provisions/clauses to delete 
``Government'' or similar language referring to the U.S. Government and 
substitute ``ordering activity'' or similar language when preparing 
solicitations and contracts to be awarded under Schedule 70. When such 
changes are made, the word ``(VARIATION)'' shall be added at the end of 
the title of the provision or clause.
    (a) 52.212-4, Contract Terms and Conditions--Commercial Items.
    (b) 52.216-19, Order Limitations.
    (c) 52.216-22, Indefinite Quantity.
    (d) 52.229-1, State and Local Taxes.
    (e) 52.232-7, Payments Under Time-and-Materials and Labor-Hour 
Contracts.
    (f) 52.232-17, Interest.
    (g) 52.232-34, Payment by Electronic Funds Transfer--Other Than 
Central Contractor Registration.
    (h) 52.232-36, Payment by Third Party.
    (i) 52.246-2, Inspection of Supplies (Fixed Price).
    (j) 52.246-4, Inspection of Services-Fixed Price.
    (k) 52.246-6, Inspection-Time-and-Material and Labor-Hour.
    (l) 52.246-16, Responsibility for Supplies.
    (m) 52.247-1, Commercial Bill of Lading Notations.
    (n) 52.247-34, F.O.B. Destination.
    (o) 52.247-38, F.O.B. Inland Carrier Point of Exportation.
    (p) 52.247-53, Freight Classification Description.


538.7004  Solicitation provisions and contract clauses.

    (a) The contracting officer shall insert the clause at 552.238-77, 
Definition (Federal Supply Schedules), in solicitations and schedule 
contracts for Schedule 70.
    (b) The contracting officer shall insert the clause at 552.238-78, 
Eligible Ordering Activities, in solicitations and contracts for 
Schedule 70.
    (c) The contracting officer shall insert the clause at 552.238-79, 
Use of Federal Supply Schedule Contracts by Certain Entities--
Cooperative Purchasing, in solicitations and Schedule 70 contracts.

PART 552--SOLICITATION PROVISIONS AND CONTRACT CLAUSES


552.211-75  [Amended]

    6. Amend section 552.211-75 by revising the date of the clause to 
read ``(Date)'' and removing from the last sentence of the clause 
``ordering agency'' and adding ``ordering activity'' in its place.


552.211-77  [Amended]

    7. Amend section 552.211-77 by--
    a. Revising the date of the clause to read ``(Date)'';
    b. Removing from paragraph (a)(3) the word ``Government'' and 
adding the words ``Ordering activity'' in its place; and
    c. Removing from the introductory text of paragraph (b) the word 
``Government'' and adding the words ``ordering activity'' in its place.


552.216-72  [Amended]

    8. Amend section 552.216-72 by--
    a. Revising the date of the clause to read ``(Date)'';
    b. Removing from the last sentence of paragraph (c) of the clause 
``other agencies'' and adding ``other ordering activities'' in its 
place; and
    c. Removing from the first sentence of paragraph (d) ``Federal 
agency'' and adding ``ordering activity'' in its place, and removing 
from the last sentence ``Federal agencies'' and adding ``Ordering 
activities'' in its place.


552.232-8  [Amended]

    9. Amend section 552.232-8 by revising the date of the clause to 
read ``(Date)''; and removing paragraph (d) and redesignating 
paragraphs (e), (f), and (g) as (d), (e), and (f), respectively.
    10. Amend section 552.232-77 by revising the section and clause 
headings and paragraphs (a) and (b); and in paragraphs (b) and (c) of 
Alternate I by removing ``Governmentwide commercial purchase card'' and 
adding ``credit card'' in its place. The revised text reads as follows:


552.232-77  Payment by Credit Card.

Payment by Credit Card (Date)

    (a) Definitions. Credit card means any credit card used to pay 
for purchases, including the Governmentwide Commercial Purchase 
Card.
    Governmentwide commercial purchase card means a uniquely 
numbered credit card issued by a Contractor under GSA's 
Governmentwide Contract for Fleet, Travel, and Purchase Card 
Services to named individual Government employees or entities to pay 
for official Government purchases.

[[Page 3224]]

    Oral order means an order placed orally either in person or by 
telephone.
    (b) At the option of the ordering activity and if agreeable to 
the Contractor, payments of * * * or less for oral or written orders 
may be made using the credit card.

* * * * *
    11. Add sections 552.232-81, 552.232-82, and 552.232-83 to read as 
follows:


552.232-81  Payments by Non-Federal Ordering Activities.

    As prescribed in 532.206(b), insert the following clause:

Payments by Non-Federal Ordering Activities (Date)

    If eligible non-federal ordering activities are subject to a 
State prompt payment law, the terms and conditions of the applicable 
State law apply to the orders placed under this contract by such 
activities. If eligible nonufederal ordering activities are not 
subject to a State prompt payment law, the terms and conditions of 
the Federal Prompt Payment Act as reflected in Federal Acquisition 
Regulation clause 52.232-25, Prompt Payment, or 52.212-4, Contract 
Terms and Conditions--Commercial Items, apply to such activities in 
the same manner as to Federal ordering activities. (End of clause)

552.232-82  Contractor's Remittance (Payment) Address.

    As prescribed in 532.206(c), insert the following provision:

Contractor's Remittance (Payment) Address (Date)

    (a) The offeror shall indicate below the payment address to 
which checks should be mailed for payment of proper invoices 
submitted under a resultant contract.
    Payment Address: ------------
    (b) Offeror shall furnish by attachment to this solicitation, 
the remittance (payment) addresses of all authorized participating 
dealers receiving orders and accepting payment in the name of the 
Contractor in care of the dealer, if different from their ordering 
address(es) specified elsewhere in this solicitation. If a dealer's 
ordering and remittance address differ, both must be furnished and 
identified as such.
    (c) All offerors are cautioned that if the remittance (payment) 
address shown on an actual invoice differs from that shown in 
paragraph (b) of this provision or on the attachment, the remittance 
address (es) in paragraph (b) of this provision or attached will 
govern. Payment to any other address will require an administrative 
change to the contract.

    Note: All delivery orders placed against a Federal Supply 
Schedule contract are to be paid by the individual ordering activity 
placing the order. Each delivery order will cite the appropriate 
ordering activity payment address, and proper invoices should be 
sent to that address. Proper invoices should be sent to GSA only for 
orders placed by GSA. Any other ordering activity's invoices sent to 
GSA will only delay your payment.

    (End of provision)

552.232-83  Contractor's billing responsibilities.

    As prescribed in 532.206(d), insert the following clause:

Contractor's Billing Responsibilities (Date)

    (a) The Contractor is required to perform all billings made 
pursuant to this contract. However, if the Contractor has dealers 
that participate on the contract and the billing/payment process by 
the Contractor for sales made by the dealer is a significant 
administrative burden, the following alternative procedures may be 
used. Where dealers are allowed by the Contractor to bill ordering 
activities and accept payment in the Contractor's name, the 
Contractor agrees to obtain from all dealers participating in the 
performance of the contract a written agreement, which will require 
dealers to--
    (1) Comply with the same terms and conditions regarding prices 
as the Contractor for sales made under the contract;
    (2) Maintain a system of reporting sales under the contract to 
the manufacturer, which includes--
    (i) The date of sale;
    (ii) The ordering activity to which the sale was made;
    (iii) The service or product/model sold;
    (iv) The quantity of each service or product/model sold;
    (v) The price at which it was sold, including discounts; and
    (vi) All other significant sales data.
    (3) Be subject to audit by the Government, with respect to sales 
made under the contract; and
    (4) Place orders and accept payments in the name of the 
Contractor in care of the dealer.
    (b) An agreement between a Contractor and its dealers pursuant 
to this procedure will not establish privity of contract between 
dealers and the Government. Price reductions made by a participating 
dealer on sales under this contract will result in an overall price 
reduction being assessed against the Contractor as provided for in 
the Price Reduction clause. (End of clause)

552.238-71  [Amended]

    12. Amend section 552.238-71 by revising the date of the clause to 
read ``(Date)'' and by removing from paragraph (a) ``Federal 
Government'' and adding ``ordering activity'' in its place.
    13. Amend section 552.238-75 by--
    a. Revising the date of the clause;
    b. Removing from paragraph (c)(2) ``Government'' and adding 
``eligible ordering activities'' in its place;
    c. Removing from the end of paragraph (d)(2) ``or''; and
    d. Redesignating paragraph (d)(3) as (d)(4), and adding a new 
paragraph (d)(3) to read as follows:


552.238-75  Price Reductions.

* * * * *

Price Reductions (Date)

* * * * *
    (d) * * *
    (3) To eligible ordering activities under this contract; or
* * * * *
    (End of clause)

    14. Add sections 552.238-77 through 552.238-79 to read as follows:


552.238-77  Definition (Federal Supply Schedules).

    As prescribed in 538.7004(a), insert the following clause:

Definition (Federal Supply Schedules) (Date)

    Ordering activity (also called ``ordering agency'' and 
``ordering office'') means an eligible ordering activity (see 
552.238-78) authorized to place orders under Federal supply schedule 
contracts. (End of clause)

552.238-78  Eligible Ordering Activities.

    As prescribed in 538.7004(b), insert the following clause:

Eligible Ordering Activities (Date)

    (a) The following activities are authorized to place orders 
under this contract on an optional basis:
    (1) Executive agencies (as defined in 48 CFR 2.1), including 
nonappropriated fund activities as prescribed in 41 CFR 101-26.000.
    (2) Government contractors authorized in writing by a Federal 
agency pursuant to FAR 51.1.
    (3) Mixed ownership Government corporations (as defined in the 
Government Corporation Control Act).
    (4) Federal agencies, including establishments in the 
legislative or judicial branch of Government (except the Senate, the 
House of Representatives and the Architect of the Capitol and any 
activities under the direction of the Architect of the Capitol).
    (5) The District of Columbia.
    (6) Tribal governments when authorized under 25 U.S.C. 450j(k).
    (7) Qualified Nonprofit Agencies as authorized under 40 U.S.C. 
502(b).
    (8) Organizations, other than those identified in paragraph (b) 
of this clause, authorized by GSA pursuant to statute or regulation 
to use GSA as a source of supply.
    (b) The following activities may place orders against Schedule 
70 contracts to include Schedule 70 products (ADP equipment 
(including firmware), software, supplies and support equipment; 
Schedule 70 services and Schedule 70 support items), on an optional 
basis; provided, the Contractor accepts order(s) from such 
activities: State and local government which includes any state, 
local, regional or tribal government or any instrumentality thereof 
(including any local educational agency or institution of higher 
education). Tribal government means the governing body of any Indian 
tribe, band, nation, or other organized group or community located 
in the continental United States (excluding the State of Alaska) 
that is recognized as eligible for the special programs and services 
provided by the

[[Page 3225]]

United States to Indians because of their status as Indians, and any 
Alaska Native regional or village corporation established pursuant 
to the Alaskan Native Claims Settlement Act (43 U.S.C. 1601, et 
seq.). (End of clause)

552.238-79  Use of Federal Supply Schedule Contracts by Certain 
Entities--Cooperative Purchasing.

    As prescribed in 538.7004(c), insert the following clause:

Use of Federal Supply Schedule Contracts by Certain Entities--
Cooperative Purchasing (Date)

    (a) If an entity identified in paragraph (b) of the clause at 
552.238-78, Eligible Ordering Activities, elects to place a delivery 
order under this contract, such order shall be subject to the 
following conditions:
    (1) When the Contractor accepts an order from such an entity, a 
separate contract is formed which incorporates by reference all the 
terms and conditions of the Schedule contract except the Disputes 
clause, the patent indemnity clause, and the portion of the 
Commercial Item Contract Terms and Conditions that specifies 
``Compliance with laws unique to Government contracts'' (which 
applies only to contracts with entities of the Executive branch of 
the U.S. Government). The parties to this new contract which 
incorporates the terms and conditions of the Schedule contract are 
the individual ordering activity and the Contractor. The U.S. 
Government shall not be liable for the performance or nonperformance 
of the new contract. Disputes which cannot be resolved by the 
parties to the new contract may be litigated in any State or Federal 
court with jurisdiction over the parties, using principles of 
Federal procurement law and the Uniform Commercial Code, as 
applicable.
    (2) Where contract clauses refer to action by a Contracting 
Officer or a Contracting Officer of GSA that shall mean the 
individual responsible for placing the order for the ordering 
activity (e.g. FAR 52.212-4 at paragraph (f) and FSS clause I-FSS-
249 B.)
    (3) As a condition of using this contract, eligible ordering 
activities agree to abide by all terms and conditions of the 
Schedule contract, except for those deleted clauses or portions of 
clauses mentioned in paragraph (a)(1) of this clause. Ordering 
activities may not modify, delete or add to the terms and conditions 
of the Schedule contract. To the extent that orders placed by such 
ordering activities may include additional terms and conditions not 
found in the Schedule contract, those terms and conditions are null, 
void, and of no effect. The ordering activity and the Contractor 
expressly acknowledge that, in entering into an agreement for the 
ordering activity to purchase goods or services from the Contractor, 
neither the ordering activity nor the Contractor will look to, 
primarily or in any secondary capacity, or file any claim against 
the United States or any of its agencies with respect to any failure 
of performance by the other party.
    (4) The ordering activity is responsible for all payments due 
the Contractor under the contract formed by acceptance of the 
ordering activity's order, without recourse to the agency of the 
U.S. Government, which awarded the Schedule contract.
    (5) The Contractor is encouraged, but not obligated, to accept 
orders from such entities. The Contractor may, within 5 days of 
receipt of the order, decline to accept any order, for any reason. 
The Contractor shall fulfill orders placed by such entities, which 
are not declined within the 5-day period.
    (6) The supplies or services purchased will be used for 
governmental purposes only and will not be resold for personal use. 
Disposal of property acquired will be in accordance with the 
established procedures of the ordering activity for the disposal of 
personal property.
    (b) If the Schedule Contractor accepts an order from an entity 
identified in paragraph (b) of the clause at 552.238-78, Eligible 
Ordering Activities, the Contractor agrees to the following 
conditions:
    (1) The ordering activity is responsible for all payments due 
the Contractor for the contract formed by acceptance of the order, 
without recourse to the agency of the U.S. Government which awarded 
the Schedule contract.
    (2) The Contractor is encouraged, but not obligated, to accept 
orders from such entities. The Contractor may, within 5 days of 
receipt of the order, decline to accept any order, for any reason. 
The Contractor shall fulfill orders placed by such entities which 
are not declined within the 5-day period. (End of clause)

    15. Amend section 552.246-73 by revising the date of the clause to 
read ``(Date)); removing from paragraph (b)(1) ``Government'' and 
adding ``ordering activity'' in its place; and removing from paragraph 
(b)(3) ``The Government'' and adding ``the ordering activity'' in its 
place.

[FR Doc. 03-1536 Filed 1-21-03; 10:37 am]
BILLING CODE 6820-BR-P