[Federal Register Volume 68, Number 238 (Thursday, December 11, 2003)]
[Proposed Rules]
[Pages 69264-69265]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 03-30695]



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Part VII





Department of Defense

General Services Administration

National Aeronautics and Space Administration





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48 CFR Part 31



Federal Acquisition Regulation; Reimbursement of Relocation Costs on a 
Lump-Sum Basis; Proposed Rule

  Federal Register / Vol. 68, No. 238 / Thursday, December 11, 2003 / 
Proposed Rule  

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DEPARTMENT OF DEFENSE

GENERAL SERVICES ADMINISTRATION

NATIONAL AERONAUTICS AND SPACE ADMINISTRATION

48 CFR Part 31

[FAR Case 2003-002]
RIN 9000-AJ81


Federal Acquisition Regulation; Reimbursement of Relocation Costs 
on a Lump-Sum Basis

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

ACTION: Proposed rule.

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SUMMARY: The Civilian Agency Acquisition Council and the Defense 
Acquisition Regulations Council (Councils) are proposing to amend the 
Federal Acquisition Regulation (FAR) to revise the relocation cost 
principle to expand the use of reimbursement on a lump-sum basis to 
certain types of employee relocation costs.

EFFECTIVE DATES: Interested parties should submit comments in writing 
on or before February 9, 2004 to be considered in the formulation of a 
final rule.

ADDRESSES: Submit written comments to-General Services Administration, 
FAR Secretariat (MVA), 1800 F Street, NW., Room 4035, ATTN: Laurie 
Duarte, Washington, DC 20405.
    Submit electronic comments via the Internet to--farcase.2003-
[email protected].
    Please submit comments only and cite FAR case 2003-002 in all 
correspondence related to this case.

FOR FURTHER INFORMATION CONTACT: The FAR Secretariat at (202) 501-4755 
for information pertaining to status or publication schedules. For 
clarification of content, contact Mr. Edward Loeb, Policy Adviser, at 
(202) 501-0650. Please cite FAR case 2003-002.

SUPPLEMENTARY INFORMATION:

A. Background

    The relocation cost principle at FAR 31.205-35 permits the 
Government to reimburse contractors for certain types of relocation 
costs, with the exception of miscellaneous costs, up to the employee's 
actual expenses. For miscellaneous costs that are described at FAR 
31.205-35(a)(5), the Government may reimburse the contractor a flat or 
lump-sum amount up to $5,000, in lieu of actual costs. The cost 
principle has no ceiling for miscellaneous expenses when reimbursement 
is based on actual expenses.
    In order to help the Councils decide whether to expand the use of 
reimbursement on a lump-sum basis, DoD, GSA, and NASA published a 
notice requesting public comments in the Federal Register at 67 FR 
65468, October 24, 2002, and invited interested parties to provide 
information to help assess the potential costs and benefits of the 
lump-sum reimbursement approach. Nine respondents submitted public 
comments. After reviewing the public comments that were submitted, the 
Councils decided to explore further the views of interested parties. 
Accordingly, DoD, GSA, and NASA published a notice of public meeting in 
the Federal Register at 68 FR 4054, January 27, 2003, and invited 
interested parties to attend a public meeting held on February 6, 2003, 
at the Department of the Interior, Washington, DC, to present their 
views on the subject. Representatives from an industry association, a 
travel and relocation management firm, and a defense contractor 
presented their views.
    It is apparent from the public comments submitted and the 
discussions at the public meeting that, in addition to the 
miscellaneous relocation costs for which lump-sum reimbursements are 
already permitted by FAR 31.205-35(b)(4), it is now common commercial 
practice to reimburse relocating employees on a lump-sum basis for 
their house-hunting, final move, and temporary lodging expenses. 
Accordingly, the Councils are proposing to amend the relocation cost 
principle to permit contractors the option of being reimbursed on a 
lump-sum basis for three types of employee relocation costs, namely, 
(1) costs of finding a new home, (2) costs of travel to the new 
location, and (3) costs of temporary lodging. These three types of 
costs are in addition to the miscellaneous relocations costs for which 
lump-sum reimbursements are already permitted. While individual 
receipts are not required with a lump-sum approach, contractors would 
still have to demonstrate that amounts paid are reasonable and 
appropriate for the circumstances of each relocating employee.
    The proposed rule is expected to reduce the accounting and 
administrative burden of the relocation cost principle on contractors 
and lead to faster relocations. Costs to the Government are not 
expected to increase significantly as a result of this revision.
    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 Councils do not expect this proposed rule to have a significant 
economic impact on a substantial number of small entities within the 
meaning of the Regulatory Flexibility Act, 5 U.S.C. 601, et seq., 
because most contracts awarded to small entities use simplified 
acquisition procedures or are awarded on a competitive, fixed-price 
basis, and do not require application of the cost principles and 
procedures discussed in this rule. An Initial Regulatory Flexibility 
Analysis has, therefore, not been performed. We invite comments from 
small businesses and other interested parties. The Councils will 
consider comments from small entities concerning the affected FAR Part 
31 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. (FAR case 
2003-002), in correspondence.

C. Paperwork Reduction Act

    The Paperwork Reduction Act does not apply because the proposed 
changes to the FAR do not impose information collection requirements 
that require the approval of the Office of Management and Budget under 
44 U.S.C. 3501, et seq.

List of Subjects in 48 CFR Part 31

    Government procurement.

    Dated: December 8, 2003.
Laura Auletta,
Director, Acquisition Policy Division.

    Therefore, DoD, GSA, and NASA propose amending 48 CFR part 31 as 
set forth below:

PART 31--CONTRACT COST PRINCIPLES AND PROCEDURES

    1. The authority citation for 48 CFR part 31 is revised to read as 
follows:

    Authority: 40 U.S.C. 121(c); 10 U.S.C. chapter 137; and 42 
U.S.C. 2473(c).

    2. Amend section 31.205-35 by revising paragraph (b)(4) to read as 
follows:


31.205-35  Relocation costs.

* * * * *
    (b) * * *
    (4) Amounts to be reimbursed shall not exceed the employee's actual 
expenses, except that reimbursement on an appropriate lump-sum basis to 
the individual employee may be allowed for any of the following 
relocation costs:

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    (i) Costs of finding a new home, as discussed in paragraph (a)(2) 
of this subsection.
    (ii) Costs of travel to the new location, as discussed in paragraph 
(a)(1) of this subsection (but not costs for the transportation of 
household goods).
    (iii) Costs of temporary lodging, as discussed in paragraph (a)(2) 
of this subsection.
    (iv) Miscellaneous costs of the type discussed in paragraph (a)(5) 
of this subsection, not to exceed a maximum lump-sum amount of $5,000.

* * * * *

[FR Doc. 03-30695 Filed 12-10-03; 8:45 am]
BILLING CODE 6820-EP-P