[Federal Register Volume 70, Number 133 (Wednesday, July 13, 2005)]
[Proposed Rules]
[Pages 40279-40280]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 05-13617]


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DEPARTMENT OF DEFENSE

GENERAL SERVICES ADMINISTRATION

NATIONAL AERONAUTICS AND SPACE ADMINISTRATION

48 CFR Part 52

[FAR Case 2004-031]
RIN 9000-AK24


Federal Acquisition Regulation; Fast Payment Procedures

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) by revising fast payment 
procedures. The proposed revision permits, but does not require, fast 
payment when invoices and/or outer shipping containers are not marked 
``Fast Pay'' provided the contract includes the ``Fast Payment 
Procedure'' clause. As highlighted in the proposed clause, if the 
clause is in the contract, the invoices will no longer be rejected, as 
is the current practice. Instead, they will be paid using either fast 
payment or normal payment procedures. In addition, the proposed 
revision deletes the requirement for marking invoices ``No Receiving 
Report Prepared.''

DATES: Interested parties should submit comments in writing on or 
before September 12, 2005, to be considered in the formulation of a 
final rule.

ADDRESSES: Submit comments identified by FAR case 2004-031 by any of 
the following methods:
     Federal eRulemaking Portal:
    http://www.regulations.gov. Follow the instructions for submitting 
comments.
     Agency Web Site:
    http://www.acqnet.gov/far/ProposedRules/proposed.htm. Click on the 
FAR case number to submit comments.
     E-mail: [email protected]. Include FAR case 2004-
031 in the subject line of the message.
     Fax: 202-501-4067.
     Mail: General Services Administration, Regulatory 
Secretariat (VIR), 1800 F Street, NW, Room 4035, ATTN: Laurieann 
Duarte, Washington, DC 20405.
    Instructions: Please submit comments only and cite FAR case 2004-
031 in all correspondence related to this case. All comments received 
will be posted without change to http://www.acqnet.gov/far/ProposedRules/proposed.htm, including any personal information 
provided.

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. Jeremy Olson, at (202) 501-3221. 
Please cite FAR case 2004-031.

SUPPLEMENTARY INFORMATION:

A. Background

    This FAR case was initiated at the request of the DoD Acting Deputy 
Chief Financial Officer (CFO), OUSD (Comptroller), who believes FAR 
52.213-1, Fast Payment Procedure, should be revised to correct a 
deficiency found during an internal review, namely, that many invoices 
were not prominently marked ``FAST PAY.'' The CFO recommends that the 
FAR be revised to:
     Address both hard copy invoices and electronic invoices so 
that they may be accepted by the payment office if the ``fast payment'' 
clause is annotated manually or electronically in the contract record; 
and
     Delete the requirement for marking invoices ``NO RECEIVING 
REPORT PREPARED.''
    Requirement to mark invoices and outer shipping containers ``Fast 
Pay.'' The current requirement to display ``Fast Pay'' prominently on 
the invoices and outer shipping containers causes payment problems. 
This requirement forces payment offices to reject invoices when the 
invoices and/or the outer shipping containers are not marked ``Fast 
Pay,'' even though the contract contains the fast payment clause. The 
Councils believe that the FAR should be revised to provide the payment 
office flexibility to make fast payments when invoices and/or outer 
shipping containers are not marked ``Fast Pay.'' The proposed language 
permits, but does not require, fast payment when invoices and/or outer 
shipping containers are not marked ``Fast Pay'' provided the contract 
includes the ``Fast Payment Procedure'' clause. Under the proposed 
language, when the payment office decides to not process invoices as 
``Fast Pay'' because the proper markings were not present, the payment 
date will be the payment date that would have applied had the ``Fast 
Pay Procedures'' clause not been in the contract. In this manner, an 
unmarked invoice will not be rejected. It is important to note that 
this change does not eliminate the requirement for the contractor to 
annotate an invoice ``Fast Pay;'' the contractor remains at risk that 
fast payment procedures will not be applied unless the invoice is 
annotated accordingly.
    Requirement to include the statement ``No Receiving Report 
Prepared.'' The current requirement to mark invoices ``No Receiving 
Report Prepared'' also causes payment problems as discussed above. In 
addition, the marking is misleading. A receiving report may be prepared 
for the contract, but if so, under fast pay procedures it is normally 
still in processing channels when the invoice arrives at the payment 
office. However, if a receiving report is not prepared, it is still 
imperative that the invoice includes sufficient information to 
facilitate follow-up verification that the item was received. The 
current FAR and the proposed revision both include a requirement for 
such information on the invoice. The difference is simply that the 
proposed revision does not require the statement ``No Receiving Report 
Prepared'' on the invoice.
    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 it will have a beneficial, but small, impact.

[[Page 40280]]

Small businesses which fail to follow the fast payment clause 
instructions to mark the invoice ``FAST PAY'', will have their invoices 
rejected, which means they would not be paid until they send in a 
corrected invoice. The clause revisions mean the invoices would not 
have to be automatically rejected. 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 
52 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 
2004-031), 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 52

    Government procurement.

    Dated: July 5, 2005.
Gerald Zaffos,
Deputy Director, Contract Policy Division.
    Therefore, DoD, GSA, and NASA propose amending 48 CFR part 52 as 
set forth below:

PART 52--SOLICITATION PROVISIONS AND CONTRACT CLAUSES

    1. The authority citation for 48 CFR part 52 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 52.213-1 by revising the date of the clause and 
paragraphs (c)(1)(ii), (c)(3), and (e) to read as follows:


52.213-1   Fast Payment Procedure.

* * * * *

FAST PAYMENT PROCEDURE (DATE)

* * * * *
    (c) * * *
    (1) * * *
    (ii) Display prominently on the invoice ``FAST PAY.'' Invoices not 
prominently marked ``Fast Pay'' via manual or electronic means may be 
accepted by the payment office for fast payment. If the payment office 
declines to make fast payment, the Contractor shall be paid in 
accordance with procedures applicable to invoices to which the Fast 
Payment clause does not apply.
* * * * *
    (3) If this contract, order, or blanket purchase agreement requires 
the preparation of a receiving report, the Contractor shall either--
    (i) Submit the receiving report on the prescribed form with the 
invoice; or
    (ii) Include the following information on the invoice:
    (A) Shipment number.
    (B) Mode of shipment.
    (C) At line item level--
    (1) National stock number and/or manufacturer's part number;
    (2) Unit of measure;
    (3) Ship-To Point;
    (4) Mark-For Point, if in the contract; and
    (5) FEDSTRIP/MILSTRIP document number, if in the contract.
* * * * *
    (e) Fast pay container identification. The Contractor shall mark 
all outer shipping containers ``FAST PAY.'' When outer shipping 
containers are not marked ``Fast Pay,'' the payment office may make 
fast payment. If the payment office declines to make fast payment, the 
Contractor shall be paid in accordance with procedures applicable to 
invoices to which the Fast Payment clause does not apply.
    (End of clause)
[FR Doc. 05-13617 Filed 7-12-05; 8:45 am]
BILLING CODE 6820-EP-S