[Federal Register Volume 71, Number 244 (Wednesday, December 20, 2006)]
[Rules and Regulations]
[Pages 76488-76515]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E6-21505]



[[Page 76487]]

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Part III





Department of Health and Human Services





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48 CFR Parts 301, 302 et al.



Acquisition Regulations; Final Rule

  Federal Register / Vol. 71, No. 244 / Wednesday, December 20, 2006 / 
Rules and Regulations  

[[Page 76488]]


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DEPARTMENT OF HEALTH AND HUMAN SERVICES

Office of the Secretary

48 CFR Parts 301, 302, 303, 304, 305, 306, 307, 309, 311, 312, 314, 
315, 316, 319, 323, 324, 325, 330, 332, 333, 334, 335, 339, 342, 
352, and 370


Acquisition Regulations

AGENCY: Department of Health and Human Services (HHS).

ACTION: Final rule.

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SUMMARY: The Department of Health and Human Services is amending its 
acquisition regulations (HHSAR) to make administrative and editorial 
changes to reflect organizational title changes resulting from Office 
of the Secretary (OS) and Operating Division (OPDIV) reorganizations 
and to update or remove outdated text and references. The intent of the 
final rule is to bring the HHSAR up to date and to make the HHSAR 
consistent with the latest amendments to the Federal Acquisition 
Regulations (FAR).

DATES: Effective Date: December 20, 2006.

FOR FURTHER INFORMATION CONTACT: Katherine Hughes, Office of 
Acquisition Management and Policy, telephone (202) 690-7079, e-mail: 
[email protected].

SUPPLEMENTARY INFORMATION:

A. Background

    The Department is not making significant amendments to the existing 
HHSAR. The amendments to the HHSAR concern internal procedural matters 
which are administrative in nature, and will not have a major effect on 
the general public or on contractors or offerors supporting the 
Department. The majority of the amendments address the following:
     HHS organizational title changes resulting from agency 
reorganizations.
     Eliminating procedural guidance no longer deemed 
necessary.
     Changing contracting review and approval authorities to 
situate them at levels more appropriate to simplification, 
streamlining, and empowerment.
     Updating the HHSAR to bring it in line with the latest 
amendments made to the Federal Acquisition Regulation (FAR).
     Clarifying authorities for selecting and terminating 
Contracting Officers.
     Establishing minimum training requirements for certain 
positions.
     Specifically referencing regulations of other Federal 
agencies.
     Updating the text of clauses required to be inserted in 
solicitations and contracts.

B. Comments on the Notice of Proposed Rulemaking

    The Department published a Notice of Proposed Rulemaking (NPRM) on 
May 26, 2006 (70 FR 30520). The comment period closed on July 25, 2006. 
The Department received one comment from the public regarding section 
352.270-8. The commenter stated that the Office for Human Research 
Protections (OHRP), which was cited as an office within the National 
Institutes of Health (NIH), is now an office in the Office of Public 
Health and Science (OPHS). Section 352.270-8 has been corrected in this 
final rule to refer to the new office location.
    In addition, the Department's internal review of the NPRM has 
resulted in a number of editorial changes and corrections, none of 
which are substantive.

C. Regulatory Flexibility Act

    The Department of Health and Human Service certifies this 
rulemaking will not have a significant economic effect on a substantial 
number of small entities under the Regulatory Flexibility Act (5 U.S.C. 
601 et seq.) because it does not impose any new requirements. 
Therefore, no regulatory flexibility statement has been prepared. Since 
this rule conveys existing acquisition policies or procedures and does 
not promulgate any new policies or procedures that would impact the 
public, it has been determined that this rule will not have a 
significant economic effect on a substantial number of small entities, 
and, thus, a regulatory flexibility analysis was not performed.

D. Paperwork Reduction Act

    The Paperwork Reduction Act does not apply because the changes to 
the HHSAR do not impose any record keeping or information collection 
requirements that require approval by the Office of Management and 
Budget under 44 U.S.C. 3501, et seq. Existing approvals cited in 48 CFR 
301.106 remain in effect. The provisions of this regulation are issued 
under 5 U.S.C. 301; 40 U.S.C. 486(c).

E. Administrative Procedure Act Exception

    This final rule imposes no new burdens on the public and merely 
updates, corrects, or clarifies existing regulations. Therefore, good 
cause exists under 5 U.S.C. 553(d) to dispense with the 30-day delay in 
the effective date requirement, and the Department of Health and Human 
Services is making the rule effective upon publication in the Federal 
Register.

List of Subjects in 48 CFR Chapter 3

    Government procurement.

    Dated: September 21, 2006.
Joe W. Ellis,
Assistant Secretary for Administration and Management.

    Editorial Note: This document was received in the Office of the 
Federal Register on December 13, 2006.

0
Under the authority of 5 U.S.C. 301; 40 U.S.C. 486(c), the Department 
of Health and Human Services amends 48 CFR Chapter 3 as set forth 
below.

CHAPTER 3--HEALTH AND HUMAN SERVICES

0
1. The authority citation for 48 CFR chapter 3, parts 301 through 370 
continues to read as follows:

    Authority: 5 U.S.C. 301; 40 U.S.C. 486(c).

PART 301--HHS ACQUISITION REGULATION SYSTEM

0
2. Revise paragraph (b) of section 301.101 to read as follows:


301.101  Purpose.

* * * * *
    (b) The HHSAR implements FAR policies and procedures and provides 
additional policies and procedures that supplement the FAR to satisfy 
the needs of HHS.
* * * * *

0
3. Revise section 301.270 to read as follows:


301.270  Executive Committee for Acquisition.

    (a) The Deputy Assistant Secretary for Acquisition Management and 
Policy has established the Executive Committee for Acquisition (ECA) to 
assist and facilitate the planning and development of departmental 
acquisition policies and procedures and to assist in responding to 
other agencies and organizations concerning policies and procedures 
impacting the Federal acquisition process.
    (b) The ECA consists of members and alternates from the Division of 
Acquisition Policy (DAP), Agency for Healthcare Research and Quality, 
Centers for Medicare & Medicaid Services, Program Support Center, 
Centers for Disease Control and Prevention, Food and Drug 
Administration, Health Resources and Services Administration, Indian 
Health Service, National Institutes of Health, and Substance Abuse and 
Mental Health Services Administration. The ECA is

[[Page 76489]]

chaired by the Director, Division of Acquisition Policy (DAP). All 
meetings will be held at the call of the Chair, and all activities will 
be carried out under the direction of the Chair.
    (c) The purposes of the ECA are to:
    (1) Advise and assist the Chair on major acquisition policy 
matters;
    (2) Review and evaluate the overall effectiveness of existing 
policies and procedures and the impact of new acquisition policies, 
procedures, and regulations on current acquisition policies and 
procedures.
    (d) The Chair will periodically issue a list of current members and 
alternates, including each person's name, title, organization, address, 
telephone number, and e-mail address. ECA members are responsible for 
apprising the Chair of any changes to the list.

0
4. Revise section 301.403 to read as follows:


301.403   Individual deviations.

    Requests for individual deviations to either the FAR or HHSAR shall 
be prepared in accordance with 301.470 and forwarded to the Deputy 
Assistant Secretary for Acquisition Management and Policy (DASAMP).

0
5. Revise section 301.404 to read as follows:


301.404  Class deviations.

    Requests for class deviations to either the FAR or HHSAR shall be 
prepared in accordance with 301.470 and forwarded to the Deputy 
Assistant Secretary for Acquisition Management and Policy (DASAMP).

0
6. Amend section 301.470 by revising paragraph (a) to read as follows:


301.470  Procedure.

    (a) Deviation requests shall be prepared in memorandum form and 
forwarded through the Head of the Contracting Activity (HCA) to the 
Director, Division of Acquisition Policy. A deviation may be requested 
verbally in an exigency situation; however, the request must be 
confirmed in writing as soon as possible.
* * * * *

0
7. Amend section 301.602-3 by revising paragraphs (b)(3), (e)(1), and 
(e)(2) to read as follows:


301.602-3  Ratification of unauthorized commitments.

* * * * *
    (b) * * *
    (3) Ratification authority for actions up to $100,000 may be 
redelegated by the HCA to the chief of the contracting office (CCO). No 
other redelegations are authorized.
* * * * *
    (e) Procedures. (1) The individual who made the unauthorized 
contractual commitment shall furnish the reviewing Contracting Officer 
all records and documents concerning the commitment and a complete 
written statement of facts, including, a description of the 
requirement, the estimated or agreed upon price, the funds citation, an 
explanation of why the contracting office was not used and why the 
proposed contractor was selected, a list of other sources considered, 
and a statement as to whether the contractor has commenced work.
    (2) The Contracting Officer will review the submitted material and 
prepare it for ratification if it is determined that the commitment is 
ratifiable. The Contracting Officer shall forward the ratification 
document and the submitted material to the HCA or CCO with any comments 
or information which should be considered in evaluation of the request 
for ratification. If legal review is desirable, the HCA or CCO will 
coordinate the request for ratification with the Office of General 
Counsel, Business and Administrative Law Division.
* * * * *

0
8. Revise section 301.603 and 301.603-1 to read as follows:


301.603  Selection, appointment, and termination of appointment of 
Contracting Officers/Contract Specialists.


301.603-1  General.

    (a) The appointment, selection, and termination of appointment of 
Contracting Officers/Contract Specialists shall be made by the HCA. 
This authority is not delegable. The procedures for the selection and 
appointment of Contracting Officers/Contract Specialists shall apply to 
anyone seeking a Contracting Officer warrant. OPDIV procedures shall be 
followed in the appointment and termination of Contracting Officers/
Contract Specialists in offices that have Contracting Officers/Contract 
Specialists with dual signature warrants.
    (b) Standard Form (SF) 1402, ``Certificate of Appointment,'' shall 
be used to appoint personnel in the 1102 series as Contracting 
Officers. It shall also be used for personnel in any other series who 
will obligate the Government to the expenditure of funds in excess of 
the micro-purchase threshold. The SF 1402 shall indicate the 
Contracting Officer's warrant level and threshold and any other 
limitations. The HCA may determine an alternate appointment document 
for appointments at or below the micropurchase threshold level. 
Contracting Officer warrants will be issued to civil service personnel 
only. A delegation of procurement authority shall be set forth in a 
memorandum that describes the spending limits and authority. Changes to 
appointments shall be made by issuing a new appointment document. Each 
appointment document shall be prepared and maintained in accordance 
with FAR 1.603-1 and shall state the limits of the individual's 
authority.
    (c) An individual must be certified at the appropriate level as a 
prerequisite to being appointed as a Contracting Officer with authority 
to obligate funds in excess of the micro-purchase threshold (see 
301.603-72). The HCA will determine and require training for 
individuals appointed as Contracting Officers/Contract Specialists at 
dollar levels below the micropurchase threshold. Individuals selected 
for Contracting Officer warrant authority must meet the education, 
training, and experience requirements that are established for the 
warrant level. An individual shall be appointed as a Contracting 
Officer only in instances where a valid organizational need is 
demonstrated. Factors to be considered in assessing the need for an 
appointment of a Contracting Officer include volume of actions, 
complexity of work, and structure of the organization.
    (d) Contracting Officers (GS-1102's) shall not sign contracts or 
modifications to contracts which will result in the total amount of the 
contract exceeding their delegated warrant authority (as specified on 
the SF-1402). This includes Indefinite Delivery Indefinite Quantity 
(IDIQ) contracts. However, orders placed against an IDIQ may be issued 
by Contracting Officers up to their delegated authority provided that 
each order is separate and distinct.
    (e) Employees delegated warrant authority are the only individuals 
legally authorized to bind the Government by executing contracts or 
signing determinations and findings required by the FAR. The amount 
specified on the warrant shall cover the estimated maximum contract 
amount, including all option periods. For example, an employee with a 
$500,000 Contracting Officer Certificate of Appointment may not award a 
contract for a base year of $300,000 if the contract includes a one-
year option for an additional $300,000. In this case, the total 
contract amount, including options, exceeds the amount stipulated in 
the warrant. If a warrant is limited to $500,000 (for example), the 
holder may not sign a contract for more than that amount, even if the 
additional amount

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is subject to the availability of funds. Contracting Officers with 
higher warrant levels may sign the action when modifications to orders 
and contracts make the total amount of the contract exceed the 
Contracting Officer's warrant limitation.

0
9. Revise section 301.603-2 to read as follows:


301.603-2  Selection of Contracting Officers.

    When it has been determined that the appointment is in the best 
interest of the OPDIV and/or Department and there is a demonstrated 
need for the procurement authority requested, nominations for 
appointment of Contracting Officers shall be submitted to the HCA 
through appropriate organizational channels for review. The HCA is 
responsible for appointing Contracting Officers in accordance with FAR 
1.603. This authority is not delegable. The HCA will determine the 
documentation required, consistent with FAR 1.603-2, when the resulting 
appointment and authority will not exceed the micropurchase threshold.

0
10. Revise section 301.603-3 to read as follows:


301.603-3  Appointment of Contracting Officers.

    (a) Appointing officials must ensure that a warrant candidate meets 
the experience and education/training requirements listed in 301.603-
72.
    (b) If it is essential to appoint an individual who does not fully 
meet the certification requirements for the Contracting Officer 
authority sought, an interim appointment may be granted by the HCA. 
HCAs are responsible for ensuring that training requirements are met 
within the specified time frame. Interim appointments may not exceed 
one year in total, and shall not be granted unless the individual can 
meet the certification requirements within one year from the date of 
appointment. The HCA may extend an interim appointment by granting 
additional time to complete the requirements of a permanent 
appointment. If the certification requirements are not completed by the 
extended date, the appointment will automatically terminate.

0
11. Revise section 301.603-4 to read as follows:


301.603-4  Termination or revocation of a Contracting Officer's 
appointment.

    Termination or revocation of Contracting Officer appointments shall 
be accomplished in accordance with FAR 1.603-4.

0
12. Revise section 301.603-70 to read as follows:


301.603-70  Delegation of Contracting Officer responsibilities.

    (a) Contracting Officer responsibilities which do not involve the 
obligation or deobligation of funds or result in establishing or 
modifying contractual provisions may be delegated by the Contracting 
Officer by means of a written memorandum that clearly delineates the 
delegation and its limits.
    (b) Contracting Officers may designate individuals as ordering 
officials to make purchases or place orders under blanket purchase 
agreements, indefinite delivery contracts, or other preestablished 
mechanisms. Ordering officials, including those under the National 
Institutes of Health's (NIH) Delegated Acquisition Program (DELPRO), 
are not Contracting Officers.

0
13. Add sections 301.603-71 through 301.603-76 to subpart 301.6 to read 
as follows:

Subpart 301.6--Career Development, Contracting Authority, and 
Responsibilities

* * * * *
301.603-71 Waivers to warrant standards.
301.603-72 Training and certification requirements for Contracting 
Officers/Contract Specialists.
301.603-73 Earned value training requirement for Contracting 
Officers/Contract Specialists who administer an IT contract.
301.603-74 Training policy exception.
301.603-75 Training requirement for purchase cardholders, Approving 
Officials (AOs), and Agency/Organization Program Coordinators (A/
OPCs).
301.603-76 Requirement for certification retention and maintaining 
currency of acquisition knowledge and skills for Contracting 
Officers/Contract Specialists and purchasing agents.

Subpart 301.6--Career Development, Contracting Authority, and 
Responsibilities


301.603-71  Waivers to warrant standards.

    There may be an unusual circumstance that requires delegation of a 
warrant to an employee who does not meet the warrant standards in of 
the HHS Contracting Officer Warrant Program. Any requests for waivers 
requesting deviations from the requirements and policies of the HHS 
Contracting Officer Warrant Program shall be sent in writing to the SPE 
for approval. The SPE will either approve or disapprove in writing the 
request for a waiver to the warrant standards. The SPE may grant 
waivers on a case-by-case basis in unique situations only.


301.603-72  Training and certification requirements for Contracting 
Officers/Contract Specialists.

    (a) Federal Acquisition Certification in Contracting (FAC-C) 
certification is not mandatory for all GS-1102s; however, members of 
the workforce issued new Contracting Officer (CO) warrants on or after 
January 1, 2007, regardless of GS series, must be certified at an 
appropriate level to support their warrant obligations, pursuant to 
agency policy. New CO warrants are defined in OFPP Policy Letter 05-01 
as warrants issued to employees for the first time at a department or 
agency. FAC-C certification does not apply to:
    (1) Senior level officials responsible for delegating procurement 
authority;
    (2) Non-1102s whose warrants are generally used to procure 
emergency goods and services; or
    (3) Non-1102s whose warrants are so limited as to be outside the 
scope of this program, as determined by the Chief Acquisition Officer 
(CAO).
    (b) HHS requires a senior level FAC-C certification for any 
employee issued an unlimited Contracting Officer's warrant on or after 
January 1, 2007.
    (c) Achievement of the FAC-C is based on three requirements: 
education, training, and experience, and the requirements are 
cumulative, (i.e., a person must meet the requirements of each previous 
certification level).
    (d) FAC-C training requirements are as follows:
    (1) FAC-C Level I:
    (i) CON 100 Shaping Smart Business Arrangements.
    (ii) CON 110 Mission Support Planning.
    (iii) CON 111 Mission Strategy Execution.
    (iv) CON 112 Mission Performance Assessment.
    (v) CON 120 Mission Focused Contracting.
    (vi) 1 Elective.
    (2) FAC-C Level II:
    (i) CON 202 Intermediate Contracting.
    (ii) CON 204 Intermediate Contract Pricing.
    (iii) CON 210 Government Contract Law.
    (iv) 2 Electives.
    (3) FAC-C Level III:
    (i) CON 353 Advanced Business Solutions for Mission Support.
    (ii) 2 Electives.
    (e) Those conducting simplified acquisitions from $2,500 to 
$100,000 will need to be issued an HHS Simplified Acquisition 
Certificate. Required training is as follows:
    (1) HHS Simplified Acquisition Certificate A:
    (ii) Basic Simplified Acquisition Procedures/DAU's CON 237.

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    (iii) Advanced Simplified Acquisition Procedures or Appropriations 
Law.
    (2) HHS Simplified Acquisition Certificate B:
    (i) Basic Simplified Acquisition Procedures/DAU's CON 237.
    (ii) Advanced Simplified Acquisition Procedures or Appropriations 
Law.
    (iii) CON 100 (Shaping Smart Business Arrangements).
    (iv) CON 110 (Mission Support Planning).
    (f) For additional information, see http://www.knownet.hhs.gov/acquisition/careerhandbookver.1.0.doc.


301.603-73  Earned value training requirement for Contracting Officers/
Contract Specialists who administer an IT contract.

    All GS-1102s who administer an IT contract, regardless of dollar 
threshold, are required to successfully complete the Department's 
(offered through HHS University) one-day course entitled ``Early 
Warning Project Management Systems Workshop,'' or an equivalent Earned 
Value training course. Determination of course equivalency shall be 
made jointly by the Office of Acquisition Management and Policy/ASAM 
and the HHS Office of the Chief Information Officer.


301.603-74  Training policy exception.

    In the event there is an urgent requirement for a Contracting 
Officer/Contract Specialist to award or administer an IT contract, and 
the Earned Value training requirement has not been met, the HCA (not 
delegable) may waive the training requirement and authorize the 
individual to perform the job duties, provided that the individual 
attends the next scheduled ``Early Warning Project Management System 
Workshop'' course, or an equivalent Earned Value course.


301.603-75  Training requirement for purchase cardholders, Approving 
Officials (AOs), and Agency/Organization Program Coordinators (A/OPCs).

    Training requirements for purchase cardholders, AOs, and A/OPCs are 
listed in the following table:

------------------------------------------------------------------------
                                    Program
        Authority \a\             participant      Required training \b\
------------------------------------------------------------------------
Up to $2,500.................  Prospective/newly  Basic purchase card
                                appointed          course (HHS
                                purchase           University 1-day
                                cardholders and    course) or an
                                Approving          equivalent course
                                Officials.         that has been
                                                   approved by the HHS
                                                   Acquisition Training
                                                   Coordinator prior to
                                                   appointment. Training
                                                   will include green-
                                                   purchasing and
                                                   Section 508
                                                   requirements.
                               Purchase card      Refresher purchase
                                holders and        card training,
                                Approving          including green-
                                Officials.         purchasing training
                                                   and Section 508
                                                   training, every 2
                                                   years.
$2,501 to $25,000............  Prospective/newly   Basic
                                appointed          Purchase Card course.
                                purchase           Basic
                                cardholders and    Simplified
                                Approving          Acquisition
                                Officials.         Procedures/DAU's CON
                                                   237.
                                                   Advanced
                                                   Simplified
                                                   Acquisition
                                                   Procedures or
                                                   Appropriations Law.
                               Purchase card      Refresher purchase
                                holders and        card training,
                                Approving          including green-
                                Officials.         purchasing training
                                                   and Section 508
                                                   training, every 2
                                                   years.
$25,001 to $100,000..........  Prospective/newly   Basic
                                appointed          Purchase Card course.
                                purchase           Basic
                                cardholders and    Simplified
                                Approving          Acquisition
                                Officials.         Procedures/DAU's CON
                                                   237.
                                                   Advanced
                                                   Simplified
                                                   Acquisition
                                                   Procedures or
                                                   Appropriations Law.
                                                   CON 100
                                                   (Shaping Smart
                                                   Business
                                                   Arrangements).
                                                   CON 110
                                                   (Mission Support
                                                   Planning).
                               Purchase           Refresher purchase
                                cardholders and    card training,
                                Approving          including green-
                                Officials.         purchasing training
                                                   and Section 508
                                                   training, every 2
                                                   years.
Not applicable...............  Prospective/newly  Basic Purchase Card
                                appointed Agency/  course, Basic
                                Organization       Simplified
                                Program            Acquisition
                                Coordinators.      Procedures or DAU's
                                                   CON 237, Advanced
                                                   Simplified
                                                   Acquisition
                                                   Procedures or
                                                   Appropriations Law,
                                                   CON 100 (Shaping
                                                   Smart Business
                                                   Arrangements), and
                                                   CON 110 (Mission
                                                   Support Planning).
                               Agency/            Refresher purchase
                                Organization       card training,
                                Program            including green-
                                Coordinators.      purchasing training
                                                   and Section 508
                                                   training, every 2
                                                   years (attendance at
                                                   GSA's annual training
                                                   conference satisfies
                                                   refresher training).
------------------------------------------------------------------------
\a\ Cardholders and Approving Officials with authorized increases in DPA
  have up to 6 months to complete the training requirements for the new
  DPA.
\b\ CON 237, CON 100, and CON 110 are available at the DAU Web site at
  http://www.dau.mil/registrar/enroll.asp. CON 100 is also offered
  through HHS University (see Web site at: http://learning.hhs.gov).

301.603-76  Requirement for certification retention and maintaining 
currency of acquisition knowledge and skills for Contracting Officers/
Contract Specialists and purchasing agents.

    To maintain a FAC-C, GS-1102s, including all warranted Contracting 
Officers regardless of series, shall earn 80 continuous learning points 
(CLPs) every two years beginning January 1, 2008. For GS-1105s and GS-
1106s, a minimum of forty (40) hours (or continuous learning points) is 
required every two years after all mandatory training requirements have 
been met. Certification will expire if the CLPs are not earned every 
two years, and may result in a loss of warrant authority.

PART 302--DEFINITIONS OF WORDS AND TERMS

0
14. Revise section 302.101 to read as follows:


302.101  Definitions.

    Agency head or head of the Agency, unless otherwise specified, 
means the head of the Operating Division (OPDIV) for Agency for 
Healthcare Research and Quality (AHRQ), Centers for Disease Control and 
Prevention (CDC), Centers for Medicare & Medicaid Services (CMS), Food 
and Drug Administration (FDA), Health Resources and Services 
Administration (HRSA), Indian Health Service (IHS), National Institutes 
of Health (NIH), Substance Abuse and Mental Health Services (SAMHSA), 
and the Deputy Secretary for the Office of the Secretary (OS).
    Chief of the Contracting Office (CCO) is typically a mid-level 
management official, usually an office director, division director, or 
branch chief, who manages and monitors the daily contract operations of 
an OPDIV or major component of an OPDIV. The CCO is subordinate to the 
Head of Contracting

[[Page 76492]]

Activity (HCA), except where the HCA and CCO are the same individual.
    Head of the contracting activity (HCA)--
    (1) Occupies designated organization positions as follows:

ASAM-OS--Deputy Assistant Secretary for Acquisition Management and 
Policy
AHRQ--Director, Division of Contracts Management
CMS--Director, Office of Acquisition and Grants Management
PSC--Director, Division of Acquisition Management
CDC--Director, Procurement and Grants Office
FDA--Director, Office of Acquisitions & Grant Services
HRSA--Director, Division of Procurement Management
IHS--Director, Division of Acquisition Policy
NIH--Director, Office of Acquisition Management and Policy
SAMHSA--Director, Division of Contracts Management

    (2) Each HCA is responsible for conducting an effective and 
efficient acquisition program. Adequate controls shall be established 
to assure compliance with applicable laws, regulations, procedures, and 
the dictates of good management practices. Periodic reviews shall be 
conducted and evaluated by qualified personnel, preferably assigned to 
positions other than in the contracting office being reviewed, to 
determine the extent of adherence to prescribed policies and 
regulations, and to detect a need for guidance and/or training.
    (3) The heads of contracting activities may redelegate their HCA 
authorities to the extent that redelegation is not prohibited by the 
terms of their respective delegations of authority, by law, by the 
Federal Acquisition Regulation, by the HHS Acquisition Regulation, or 
by other regulations. However, HCA and other contracting approvals and 
authorities shall not be redelegated below the levels specified in the 
HHS Acquisition Regulation or, in the absence of coverage in the HHS 
Acquisition Regulation, the Federal Acquisition Regulation. To ensure 
proper control of redelegated acquisition authorities, HCAs shall 
maintain a file containing successive delegations of HCA authority 
through and including the Contracting Officer level. Personnel 
delegated responsibility for acquisition functions must possess a level 
of experience, training, and ability commensurate with the complexity 
and magnitude of the acquisition actions involved.
    Project Officer is a Federal employee who monitors contractor 
performance and provides technical guidance to the Contract Specialist/
Contracting Officer. The Project Officer serves as the Contract 
Specialist/Contracting Officer's authorized representative to monitor 
specific aspects of the contract, thereby ensuring that the 
contractor's performance meets the standards set forth in the contract, 
the technical requirements under the contract are met by the delivery 
date(s) and/or within the period of performance, and performance is 
accomplished within the price or estimated cost stated in the contract. 
A Project Officer is required to comply with HHS Project Management 
Certification Program training requirements. The term ``Project 
Officer'' is synonymous with Contracting Officer's Representative (COR) 
and Contracting Officer's Technical Representative (COTR).

0
15. Revise section 302.201 to read as follows:


302.201  Contract clause.

    The FAR clause, Definitions, at 52.202-1 shall be used as 
prescribed in FAR 2.201, except as follows:
    (a) In accordance with 52.202-1(a)(1), paragraph (a) at 352.202-1 
shall be used in place of paragraph (a) of the FAR clause.
    (b) In accordance with 52.202-1(a)(1), paragraph (h), or its 
alternate, at 352.202-1 shall be added to the end of the FAR clause. 
Use paragraph (h) when a fixed-priced contract is anticipated; use the 
alternate to paragraph (h) when a cost-reimbursement contract is 
anticipated. This is an authorized deviation.

PART 303--IMPROPER BUSINESS PRACTICES AND PERSONAL CONFLICTS OF 
INTEREST

0
16. Revise section 303.101-3 to read as follows:


303.101-3  Agency regulations.

    (a)(3) The Department of Health and Human Services' Standards of 
Conduct are prescribed in 45 CFR part 73.

0
17. Revise paragraph (a)(2)(i) of section 303.104-7 to read as follows:


303.104-7  Violations or possible violations of the Procurement 
Integrity Act.

    (a) * * *
    (2) * * *
    (i) Refer the matter immediately to the Deputy Assistant Secretary 
for Acquisition Management and Policy (DASAMP), Assistant Secretary for 
Administration and Management, Office of the Secretary, for review, 
which may consult with the Office of General Counsel (OGC) and the 
Office of Inspector General (OIG), as appropriate; and
* * * * *

0
18. Revise section 303.303 to read as follows:


303.303  Reporting suspected antitrust violations.

    (h) A copy of the agency report of suspected antitrust violations 
submitted to the Attorney General by the HCA shall also be submitted to 
the Director, Office of Acquisition Management and Policy.

0
19. Revise section 303.405 to read as follows:


303.405  Misrepresentations or violations of the Covenant Against 
Contingent Fees.

    (a) Reports shall be made promptly to the Contracting Officer.
    (b)(4) Suspected fraudulent or criminal matters to be reported to 
the Department of Justice shall be prepared in letter format and 
forwarded through acquisition channels to the head of the contracting 
activity for signature. The letter must contain all pertinent facts and 
background information considered by the Contracting Officer and chief 
of the contracting office that led to the decision that fraudulent or 
criminal matters may be present. A copy of the signed letter shall be 
sent to the Director, Office of Acquisition Management and Policy.

0
20. Revise section 303.704 to read as follows:


303.704  Policy.

    (a) For purposes of implementing FAR subpart 3.7, the authorities 
granted to the ``agency head or designee'' shall be exercised by the 
HCA (not delegable).

PART 304--ADMINISTRATIVE MATTERS

0
21. Revise section 304.602 to read as follows:


304.602  Federal Procurement Data System--Next Generation (FPDS-NG).

    The Departmental Contracts Information System (DCIS) represents the 
Department's implementation of the FPDS-NG. All departmental 
contracting activities are required to use the DCIS and follow the 
procedures stated in the Enhanced Departmental Contracts Information 
System Manual, available at http://dcis.hhs.gov, and amendments to the 
manual. The HCA (not delegable) shall ensure that all required contract 
information is collected, submitted, and received into the DCIS on or 
before the 15th of each month for all contracts and

[[Page 76493]]

contract modifications awarded in the previous month.

0
22. Amend 304.804-70 by revising paragraphs (a) and (b)(1) to read as 
follows:


304.804-70  Contract closeout audits.

    (a) Contracting Officers shall rely, to the maximum extent 
possible, on single audits to close physically completed cost-
reimbursement contracts with colleges and universities, hospitals, non-
profit firms, and State and local governments. In addition, where 
appropriate, a sample of these contractors may be selected for audit, 
in accordance with paragraph (b) of this section.
    (b) * * *
    (1) The Office of the Inspector General (OIG) and ASAM's Deputy 
Assistant Secretary for Acquisition Management and Policy in 
conjunction with the OPDIV's cost advisory/audit focal point, determine 
which contracts or contractors will be audited, which audit agency will 
perform the audit, and the type and scope of closeout audit to be 
performed. These decisions shall be based upon the needs of the 
customer, risk analysis, return on investment, and the availability of 
audit resources. When an audit is warranted prior to closing a 
contract, the Contracting Officer shall submit the audit request to the 
OIG's Office of Audit, via the OPDIV's cost advisory/audit focal point.
* * * * *

0
23. Revise paragraphs (b)(3), (b)(6), and (e) of section 304.7001 to 
read as follows:


304.7001  Numbering acquisitions.

* * * * *
    (b) * * *
    (3) The three digit numeric identification code assigned by the 
Deputy Assistant Secretary for Acquisition Management and Policy 
(DASAMP) to the contracting office within the servicing agency;
* * * * *
    (6) A one digit code describing the type of contract action:

A Commercial Item Acquisition
C New Definitive Contract
P Purchase Using Simplified Acquisition
I Indefinite Delivery Contract (IDIQ)
O Basic Ordering Agreement (BOA)
B Blanket Purchase Agreement (BPA)
F Facilities Contract
U Contracts placed with or through other Government departments, GSA 
contracts, or against mandatory source contracts such as the National 
Industries for the Blind (NIB), the National Industries for the 
Severely Handicapped (NISH), and the Federal Prison Industries (UNICOR)
L Lease Agreement
W Government-wide Acquisition Contract (GWAC)
E Letter Contract
G Federal Supply Schedule
M Micropurchase

    For example, the first contract for NIH, National Cancer Institute, 
for fiscal year 2005 may be numbered HHSN261200500001C.
* * * * *
    (e) Assignment of identification codes. Each contracting office of 
the Department shall be assigned a three digit identification code by 
the ASAM/OAMP. Requests for the assignment of codes for newly 
established contracting offices shall be submitted by a headquarters 
official from the new contracting office to the OAMP. A listing of the 
contracting office identification codes currently in use is contained 
in the Enhanced Departmental Contracts Information System Manual, 
available at http://dcis.hhs.gov.

PART 305--PUBLICIZING CONTRACT ACTIONS

0
24. Revise section 305.202 to read as follows:


305.202  Exceptions.

    (b) When a contracting office believes that it has a situation 
where advance notice is not appropriate or reasonable, it shall prepare 
a memorandum citing all pertinent facts and details and send it, 
through normal acquisition channels, to the Deputy Assistant Secretary 
for Acquisition Management and Policy (DASAMP) requesting relief from 
synopsizing. The DASAMP shall review the request and decide whether an 
exception to synopsizing is appropriate or reasonable. If it is, the 
DASAMP shall take the necessary coordinating actions required by FAR 
5.202(b). Whatever the decision is on the request, the DSAMP shall 
promptly notify the contracting office when a determination has been 
made.

0
25. Revise section 305.303 to read as follows:


305.303   Announcement of contract awards.

    (a) Public announcement. Awards over $3.5 million, not otherwise 
exempt under FAR 5.303, shall be reported by the Contracting Officer to 
the Office of the Assistant Secretary for Legislation (Congressional 
Liaison), Room 406G, Hubert H. Humphrey Building. Notification shall be 
accomplished by providing a copy of the contract or award document face 
page to the referenced office prior to the day of award, or in 
sufficient time to allow for an announcement to be made by 5 p.m. 
Washington, DC time on the day of award. Notification may also be 
accomplished by e-mailing a copy of the contract or award document face 
page to [email protected], or faxing to (202) 205-2420.

0
26. Revise section 305.502 to read as follows:


305.502   Authority.

    The Contracting Officer may advertise or place notices in 
newspapers and periodicals to announce that proposals are being sought.

PART 306--COMPETITION REQUIREMENTS

0
27. Revise section 306.302-1 to read as follows:


306.302-1  Only one responsible source and no other supplies or 
services will satisfy agency requirements.

    (a)(2)(iv) Follow-on contracts for the continuation of major 
research and development studies on long-term social and health 
programs, major research studies, or clinical trials may be deemed to 
be available only from the original source when it is likely that award 
to any other source would result in unacceptable delays in fulfilling 
the Department's or OPDIV's requirements.
    (b) Application. (5) When the head of the program office has 
determined that only specified makes and models of technical equipment 
or parts must be obtained to meet the activity's program responsibility 
to test and evaluate certain kinds and types of products, and only one 
source is available. (This criterion is limited to testing and 
evaluation purposes only and may not be used for initial outfitting or 
repetitive acquisitions. Project officers should support the use of 
this criterion with citations from their agency's legislation and the 
technical rationale for the item of equipment required.)
0
28. Revise section 306.303-1 to read as follows:


306.303-1  Requirements.

    (a)(1) The Program Office must provide a written justification 
whenever it requests that certain goods or services be obtained without 
full and open competition. The justification must explain why full and 
open competition is not feasible and must be submitted with the 
requisition or request for contract.
    (i) Justifications in excess of the simplified acquisition 
threshold shall be in the form of a separate, self-contained

[[Page 76494]]

document, prepared in accordance with FAR 6.303 and 306.303, and called 
a ``JOFOC'' (Justification for Other Than Full and Open Competition). 
Justifications at or below the simplified acquisition threshold may be 
in the form of a paragraph or paragraphs contained in the requisition 
or request for contract.
    (ii) Justifications, whether over or under the simplified 
acquisition threshold, shall fully describe what is to be acquired, 
offer reasons which go beyond inconvenience, and explain why it is not 
feasible to obtain competition. The justifications shall be supported 
by verifiable facts rather than mere opinions. Documentation in the 
justification should be sufficient to permit an individual with 
technical competence in the area to follow the rationale.
    (iii) Sole source justifications using the Federal Supply Schedule 
shall include the content listed in FAR 6.303-2.
    (b) Preliminary arrangements or agreements with the proposed 
contractor shall have no effect on the rationale used to support an 
acquisition for other than full and open competition.

0
29. Revise section 306.303-2 to read as follows:


306.303-2   Content.

    (a)(1) Each justification shall include the name of the program 
office; the name, address, and phone number of the Project Officer; and 
project identification, such as the authorizing program legislation, to 
include citations or other internal program identification data such as 
title, contract number, etc.
    (2) The description may be in the form of a statement of work, 
purchase description, or specification. A statement is to be included 
to explain whether the acquisition is an entity in itself, whether it 
is one in a series, or part of a related group of acquisitions.
    (c) JOFOCs shall be signed by the Project Officer, the Project 
Officer's immediate supervisor, the Contracting Officer, and the 
approving official (if the approving official is not the Contracting 
Officer).

0
30. Revise section 306.304 to read as follows:


306.304   Approval of the justification.

    (a)(2) The competition advocates are listed in 306.501. This 
authority is not delegable.
    (3) The competition advocate shall exercise this approval 
authority, except where the individual designated as the competition 
advocate does not meet the requirements of FAR 6.304 (a)(3)(ii). This 
authority is not delegable.
    (4) The senior procurement executive of the Department is the 
Deputy Assistant Secretary for Acquisition Management and Policy. This 
designation has been made pursuant to the OFPP Act (41 U.S.C. 
414(c)(2)(B).
    (c) A class justification shall be processed the same as an 
individual justification.

0
31. Revise section 306.501 to read as follows:


306.501   Requirement.

    The Department's competition advocate is the Director, Strategic 
Acquisition Service, Program Support Center (PSC). The competition 
advocates for each of the Department's contracting activities are as 
follows:

AHRQ--Director, Office of Performance Accountability, Resources and 
Technology
CDC--Chief Information Officer
CMS--Chief Operating Officer
FDA--Chief, Office of Shared Services
HRSA--Associate Administrator, Office of Administration and Financial 
Management
IHS--Director, Office of Management Services
NIH--Senior Scientific Advisor for Extramural Research, Office of 
Extramural Research (R&D) and Senior Advisor to the Director (Other 
than R&D)
PSC--Director, Strategic Acquisition Service
SAMHSA--Executive Officer

PART 307--ACQUISITION PLANNING

0
32. Revise section 307.104 to read as follows:


307.104  General procedures.

    (a) Each contracting activity shall prepare an Annual Acquisition 
Plan (AAP). The AAP is a macro plan, containing a list of anticipated 
contract actions over the simplified acquisition threshold and their 
associated funding, as well as the aggregate planned dollars for 
simplified acquisitions by quarter, developed for each fiscal year. The 
AAP shall conform to reasonable budget expectations and shall be 
reviewed at least quarterly and modified as appropriate. The HCA or the 
CCO shall obtain this information from the program planning/budget 
office of the contracting activity and use the AAP to provide necessary 
reports and monitor the workload of the contracting office. For 
contract actions, the plan shall contain, at a minimum:
    (1) A brief description (descriptive title, perhaps one or two 
sentences if necessary);
    (2) Estimated award amount;
    (3) Requested award date;
    (4) Name and phone number of contact person (usually the Project 
Officer);
    (5) Other information required for OPDIV needs.
    (b) Once the AAP is obtained from the program planning/budget 
office, the Contracting Officer/Contract Specialist shall initiate 
discussions with the assigned Project Officer for each planned 
negotiated acquisition over $100,000 except for:
    (1) Acquisitions made under interagency agreements, and
    (2) Contract modifications which exercise options, make changes 
authorized by the Changes clause, or add funds to an incrementally 
funded contract. (The HCA may prescribe procedures for contract actions 
not covered by this subpart.)
    (c) The purpose of the discussions between the Contracting and 
Project Officers is to develop an individual acquisition planning 
schedule and to address areas that will need to be covered in the 
request for contract (RFC), including clearances, acquisition strategy, 
sources, etc. The Project Officer must either have a statement of work 
(SOW) ready at this time or must discuss in more detail the nature of 
the services/supplies that will be required.
    (d) Standard lead-times for processing various types of 
acquisitions and deadlines for submission of acceptable RFCs (that is, 
RFCs which include all required elements such as clearances, funding 
documents, and an acceptable SOW) for award in a given fiscal year 
shall be established by the HCA or designee not lower than the CCO.
    (e) The outcome of the discussions referenced in paragraph (c) of 
this section between the Project Officer and the Contracting Officer/
Contract Specialist will be an agreement concerning the dates of 
significant transaction-specific acquisition milestones, including the 
date of submission of the RFC to the Contracting Officer. This 
milestone schedule document will be prepared with those dates and will 
be signed by the Project Officer and the Contracting Officer. The 
milestones cannot be revised except by mutual agreement of these same 
individuals. If the planning schedule indicates the need to obtain 
approval of a Justification for Other than Full and Open Competition, 
the HCA or CCO must sign the milestone agreement. This document shall 
be retained in the contract file. All other considerations that will 
affect the acquisition (technical, business, management) shall be 
addressed in the RFC (see 307.71).

[[Page 76495]]


0
33. Revise section 307.170 to read as follows:


307.170   Program training requirements.

    (a) HHS will maintain a program for certifying employees before 
they may be considered eligible for appointment as a program/project 
manager or COR/COTR.
    (b) All HHS program/project managers, alternate program/project 
managers, CORs/COTRs, alternate CORs/COTRs, and at least fifty percent 
of the HHS program personnel performing the function of technical 
proposal evaluator on a technical evaluation team or panel for a 
competitively solicited HHS contract, shall have successfully completed 
the Department's ``Basic Project Officer'' course, or an equivalent 
course, before assuming the duties of their designated role, or take 
the next available class. This requirement applies to the initial 
technical proposal evaluation and any subsequent technical evaluations 
that may be required. (*Peer and objective reviewers are excluded from 
these requirements). Course equivalency for the ``Basic Project 
Officer'' course will be determined by the ASAM/OAMP. The Contracting 
Officer is responsible for ensuring that the program/project manager, 
COR/COTR, and proposal evaluators have successfully completed the 
required training. Non-information technology (IT) program/project 
managers and non-IT CORs/COTRs who have successfully completed the 
appropriate ``Basic Project Officer'' course, or an equivalent course, 
are highly encouraged to take the Department's one-day course entitled 
``Early Warning Project Management System Workshop,'' or an equivalent 
Earned Value course. Program/Project managers and CORs/COTRs are highly 
encouraged to take the Department's ``Writing Statements of Work'' 
course, or an equivalent course. Peer and objective reviewers are 
excluded from these requirements. (*The peer review process pertains 
specifically to NIH in the peer review of applications for grants and 
contracts. Applications are evaluated by a peer review group composed 
of scientists from the extramural research community.) All courses are 
offered through HHS University.

0
34. Revise section 307.170-1 to read as follows:


307.170-1   Training policy exceptions.

    In the event there is an urgent requirement for a specific 
individual to serve as a program/project manager and COR/COTR (or 
alternate program/project manager and alternate COR/COTR) and that 
individual has not successfully completed the prerequisite training 
course(s), the HCA (not delegable) may waive the training requirement 
and authorize the individual to perform the project duties, provided 
that:
    (a) The individual first meets with the cognizant Contracting 
Officer to review the HHS ``Project Officer's Contracting Handbook'' to 
discuss the important aspects of the contracting-program office 
relationship as appropriate to the circumstances; and
    (b) The individual attends the next scheduled ``Basic Project 
Officer'' course, or an equivalent course, and, for those current and 
proposed IT program/project managers, as well as alternate IT program/
project managers and IT CORs/COTRs (as well as alternate CORs/COTRs) 
assigned to HHS IT projects (including those designated as major or 
tactical by HHS), the next ``Early Warning Project Management System 
Workshop.''
0
35. Add sections 307.170-3 through 307.170-9 to subpart 307.1 to read 
as follows:
Subpart 307.1--Acquisition Planning
307.170-3 Earned value training requirement for IT program/project 
managers and IT CORs/COTRs.
307.170-4 Required training in HHS' portfolio management tool.
307.170-5 Maintenance/refresher training requirement for program/
project managers and CORs/COTRs.
307.170-6 Warranting of Other Transaction Officers for Other 
Transactions.
307.170-7 Training Requirements for Other Transaction Officers.
307.170-8 Appointment of an Other Transaction Officer Technical 
Representative for an Other Transaction.
307.170-9 Training requirement for an Other Transaction Officer 
Technical Representative.

Subpart 307.1--Acquisition Planning

* * * * *


307.170-3  Earned value training requirement for IT program/project 
managers and IT CORs/COTRs.

    All current and proposed IT program/project managers, alternate IT 
program/project managers, IT CORs/COTRs, and alternate CORs/COTRs 
assigned to HHS IT projects (including those IT projects designated as 
major or tactical), regardless of dollar threshold, must successfully 
complete the Department's (offered through HHS University) one-day 
course entitled ``Early Warning Project Management System Workshop,'' 
or an equivalent Earned Value training course. Course equivalency will 
be determined jointly by the ASAM/OAMP and the HHS Office of the Chief 
Information Officer.


307.170-4  Reqired training in HHS' portfolio management tool.

    All current and proposed IT program/project managers, as well as 
alternate IT program/project managers and IT CORs/COTRs (as well as 
alternate IT CORs/COTRs), regardless of dollar threshold, must 
successfully complete training in HHS' portfolio management tool 
(contact the HHS Office of the Chief Information Officer for additional 
information).


307.170-5  Maintenance/refresher training requirement for program/
project managers and CORs/COTRs.

    Program/Project Managers and CORs/COTRs who monitor one or more 
contracts are required to take 40 CLPs each year.


307.170-6  Warranting of Other Transaction Officers for Other 
Transactions.

    (a) Other Transaction (OT) Officers shall possess the 
qualifications necessary to ensure that OTs are in compliance with 
applicable laws and regulations. The ASAM/OAMP will have the sole 
authority to warrant OT Officers at HHS. To receive a warrant as an HHS 
OT Officer, the individual must be a Contracting Officer, preferably 
with an unlimited warrant, with a Federal Acquisition Certification in 
Contracting (FAC-C) Level III, or a Level III or IV certified Grants 
Officer within HHS. Nominations for appointment of OT Officers shall be 
submitted to the Head of Contracting Activity in writing through 
appropriate organizational channels for review. The nomination package 
shall include the following:
    (1) A completed Appendix A (``OT Officer's Warrant Application 
Form'') of HHS Other Transaction Authority Guidebook;
    (2) A recommendation from the employee's immediate supervisor 
providing justification for the appointment of an HHS OT Officer;
    (3) Current resume/OF 612/SF 171 and/or other documentation 
describing the employee's experience, education, and training relevant 
to the position for which warrant authority is being sought;
    (4) A copy of the employee's most recent performance appraisal;
    (5) Type of work to be performed under the warrant, i.e., executing 
OTs;
    (6) A copy of the certificate issued under the HHS Acquisition 
Certification Program indicating the employee's current certification 
level and a copy of previous warrant certificate, if applicable; or a 
copy of the certificate issued under the HHS Grants Certification 
Program, if applicable; and
    (7) Proof of successful completion of the ``Cooperative Agreements, 
CRADAs

[[Page 76496]]

& Other Transactions'' course taught by Federal Publications Seminars, 
or an equivalent course.
    (b) For additional information, see http://www.knownet.hhs.gov/acquisition/hhs_epp_postings/HHSGuidebook1-OTAMarch2005.doc.


307.170-7  Training Requirements for Other Transaction Officers.

    OT Officers must successfully complete the ``Cooperative 
Agreements, CRADAs & Other Transactions'' course, or an equivalent 
course, prior to appointment as an OT Officer. Grants Officers who 
serve as OT Officers are required to have successfully completed the 
following courses: CON 110 (``Mission Support Planning''); CON 111 
(``Mission Strategy Execution,''); CON 112 (``Mission Performance,'') 
or CON 120 (``Mission Focused Contracting.''), or equivalent courses 
prior to being appointed as an OT Officer. The HHS OTA Board will 
determine course equivalency.


307.170-8  Appointment of an Other Transaction Officer Technical 
Representative for an Other Transaction.

    The program office nominates the Other Transaction Officer 
Technical Representative (OTR). The OT Officer prepares an OTR 
delegation memorandum that describes the OTR's authority and assigns 
the OTR specific responsibilities, with limitations of authority, in 
writing. The OTR represents the OT Officer only to the extent delegated 
in the written appointment and does not have the authority to change 
the terms and conditions of the OT.


307.170-9  Training requirement for an Other Transaction Officer 
Technical Representative.

    (a) Program personnel selected to serve as an OTR or an alternate 
OTR assigned to an OT, and at least fifty percent of the technical 
evaluators that review the initial and any subsequent proposals or 
revisions thereof, shall successfully complete the Department's ``Basic 
Project Officer'' course, or an equivalent course prior to being 
appointed. Determination of course equivalency shall be made by the HHS 
OTA Board.
    (b) In addition to the Department's required ``Basic Project 
Officer'' course, the OTR or alternate OTR assigned to an OT, and at 
least fifty percent of the technical evaluators that review the initial 
and any subsequent proposals or revisions thereof, shall successfully 
complete the ``Cooperative Agreements, CRADAs & Other Transactions'' 
course, or an equivalent course, prior to being appointed and prior to 
assuming job duties associated with the OT.
    (c) Refresher training in the policies and procedures of awarding 
cooperative agreements, CRADAs and OTs is required every three years.


307.302, 307.303, 307.304, and 307.307  [Removed]

0
36. Remove subpart 307.3 (sections 307.302, 307.303, 307.304, and 
307.307).

0
37. Revise paragraph (b)(2) of section 307.7001 to read as follows:


307.7001  Distinction between acquisition and assistance.

* * * * *
    (b) * * *
    (2) The Department determines in a specific instance that the use 
of a type of contract is appropriate. That is, it is determined in a 
certain situation that specific needs can be satisfied best by using 
the acquisition process. However, this authority does not permit 
circumventing the criteria for use of acquisition or assistance 
instruments. Use of this authority is restricted to extraordinary 
circumstances and only with the prior approval of the Deputy Assistant 
Secretary for Acquisition Management and Policy (DASAMP).
* * * * *

0
38. Revise section 307.7104 to read as follows:


307.7104  Transmittal.

    The RFC must be conveyed to the contracting office by use of a 
cover memorandum. The cover memorandum must be signed by the head of 
the sponsoring program office and include both a statement attesting to 
the conclusiveness of the review described in 307.7103(b) and a list 
identifying all attachments to the RFC.

0
39. Amend section 307.7105 by revising the introductory text for the 
section, the introductory text for paragraph (b)(4), and paragraphs 
(b)(4)(i) and (b)(7) to read as follows:


307.7105  Format and content.

    The Department is in the process of standardizing a format for the 
RFC. In the interim, the information in paragraph (a) of this section 
must be included. Paragraph (b) contains information that must also be 
included if applicable.
* * * * *
    (b) * * *
    (4) Special program clearances or approvals. The following special 
program clearances or approvals should be reviewed for applicability to 
each acquisition. Those which are applicable should be addressed during 
the planning discussions between the Project Officer and Contracting 
Officer/Contract Specialist (see 307.104(c)) and immediate action 
should be initiated by the Project Officer to obtain the necessary 
clearances or approvals. The Contracting Officer/Contract Specialist 
shall provide a comprehensive checklist of these and any OPDIV special 
approvals, clearances, and requirements to the program office. If the 
approval or clearance has been requested and is being processed at the 
time of RFC submission, a footnote to this effect, including all 
pertinent details, must be included in this section.
    (i) Commercial activities. (OMB Circular No. A-76). An RFC must 
contain a statement as to whether the proposed solicitation is or is 
not to be used as part of an OMB Circular No. A-76 public-private cost 
comparison. (See OMB Circular No. A-76, Performance of Commercial 
Activities.)
* * * * *
    (7) Special terms and conditions. Any suggested special terms and 
conditions not already covered in the statement of work.
* * * * *

0
40. Amend section 307.7106 by revising paragraphs (a) and (d) to read 
as follows:


307.7106  Statement of work.

    (a) General. A statement of work (SOW) describes the work or 
services to be performed in reaching an end result without describing 
the method that will be used unless the method of performance is 
critical or required in order to obtain successful performance. The SOW 
should be clear and concise and must completely define the 
responsibilities of both the contractor and the Government. The SOW 
should be worded to make more than one interpretation virtually 
impossible.
* * * * *
    (d) Elements of the SOW. The elements of the SOW will vary with the 
objective, complexity, size, and nature of the acquisition. In general, 
it should include the following:
    (1) Purpose of the project. This includes a general description of 
the objectives of the project and the desired results.
    (2) Background information. This includes a brief history of the 
project and the importance of the project to the overall program 
objectives.
    (3) A detailed description of the technical requirements. The 
statement of work should provide sufficient detail to accurately 
reflect the Government's requirement. It should state what is to

[[Page 76497]]

be done without prescribing the method to be used and should include 
performance standards. The statement of work may be broken down into 
tasks and subtasks. The degree of breakout depends on the size and 
complexity of the project. The statement of work should indicate 
whether the tasks are sequential or concurrent.
    (4) Reference material. All reference material to be used in the 
conduct of the project that indicates how the work is to be carried out 
must be identified. Applicability should be explained, and a statement 
made as to where the material can be obtained.
    (5) Level of effort. When a level of effort is required, the number 
and type of personnel required should be stated. If known, the type and 
degree of expertise should be specified.
    (6) Special requirements. (as applicable). An unusual or special 
contractual requirement, which would impact on contract performance, 
should be included as a separate section.
    (7) Deliverables reporting requirements. All deliverables and/or 
reports must be clearly and completely described. Include the timeframe 
for completion, the format, and the number of copies.

PART 309--CONTRACTOR QUALIFICATIONS

0
41. Revise section 309.403 to read as follows:


309.403  Definitions.

    Acquiring agency's head or designee, as used in the FAR, shall 
mean, unless otherwise stated in this subpart, the head of the 
contracting activity. Acting in the capacity of the acquiring agency's 
head, the head of the contracting activity may make the required 
justifications or determinations, and take the necessary actions, 
specified in FAR 9.405, 9.406, and 9.407 for his or her respective 
activity, but only after obtaining the written approval of the 
debarring or suspending official, as the case may be.
    Debarring official means the Assistant Secretary for Administration 
and Management, or his/her designee.
    Initiating official means either the contracting officer, the head 
of the contracting activity, the Deputy Assistant Secretary for 
Acquisition Management and Policy, or the Inspector General.
    Suspending official means the Assistant Secretary for 
Administration and Management, or his/her designee.

0
42. Revise section 309.404 to read as follows:


309.404  List of parties excluded from Federal procurement and 
nonprocurement programs.

    (c) The Office of Acquisition Management and Policy (OAMP) shall 
perform the actions required by FAR 9.404(c).
    (4) OAMP shall maintain all documentation submitted by the 
initiating official recommending the debarment or suspension action and 
all correspondence and other pertinent documentation generated during 
the OAMP review.

0
43. Amend section 309.405 by revising paragraph (a)(1) to read as 
follows:


309.405  Effect of listing.

    (a) * * *
    (1) If a Contracting Officer considers it necessary to award a 
contract, or consent to a subcontract with a debarred or suspended 
contractor, the Contracting Officer shall prepare a determination, 
including all pertinent documentation, and submit it through 
acquisition channels to the head of the contracting activity. The 
documentation must include the date by which approval is required and a 
compelling reason for the proposed action. Compelling reasons for award 
of a contract or consent to a subcontract with a debarred or suspended 
contractor include:
    (i) The property or services to be acquired are available only from 
the listed contractor; or
    (ii) The urgency of the requirement dictates that the Department 
conduct business with the listed contractor.
* * * * *

0
44. Revise section 309.406-3 to read as follows:


309.406-3  Procedures.

    (a) Investigation and referral. When an apparent cause for 
debarment becomes known, the initiating official shall prepare a report 
containing the information required by 309.470-2, along with a written 
recommendation, and forward it through appropriate channels to the 
debarring official. Reports shall be forwarded in accordance with 
309.470-1. The debarring official, the Deputy Assistant Secretary for 
Acquisition Management and Policy, shall initiate an investigation.
    (b) Decision making process. The debarring official shall review 
the results of the investigation, if any, and make a written 
determination whether or not debarment procedures are to be commenced. 
A copy of the determination shall be promptly sent through appropriate 
channels to the initiating official and the Contracting Officer. If it 
is determined that debarment procedures shall commence, the debarring 
official shall consult with the Office of General Counsel and then 
notify the contractor in accordance with FAR 9.406-3(c). If the 
proposed action is not based on a conviction or judgment and the 
contractor's submission in response to the notice raises a genuine 
dispute over facts material to the proposed debarment, the debarring 
official shall arrange for fact-finding hearings and take the necessary 
action specified in FAR 9.406-3(b)(2). The debarring official shall 
also ensure that written findings of facts are prepared, and shall base 
the debarment decisions on the facts as found, after considering 
information and argument submitted by the contractor and any other 
information in the administrative record. The Office of the General 
Counsel shall represent the Department at any fact-finding hearing and 
may present witnesses for HHS and question any witnesses presented by 
the contractor.

0
45. Revise section 309.407-3 to read as follows:


309.407-3  Procedures.

    (a) Investigation and referral. When an apparent cause for 
suspension becomes known, the initiating official shall prepare a 
report containing the information required by 309.470-2 along with a 
written recommendation and forward it through appropriate channels to 
the suspending official. Reports shall be forwarded in accordance with 
309.470-1. The suspending official shall initiate an investigation.
    (b) Decision making process. The suspending official shall review 
the results of the investigation, if any, and make a written 
determination whether or not suspension should be imposed. A copy of 
this determination shall be promptly sent through appropriate channels 
to the initiating official and the Contracting Officer. If it is 
determined that suspension shall be imposed, the suspending official 
shall consult with the Office of General Counsel and then notify the 
contractor in accordance with FAR 9.407-3(c). If the action is not 
based on an indictment, and, subject to the provisions of FAR 9.407-
3(b)(2), the contractor's submission in response to the notice raises a 
genuine dispute over facts material to the suspension, the suspending 
official shall, after suspension has been imposed, arrange for fact-
finding hearings and take the necessary actions specified in FAR 9.407-
3(b)(2).

[[Page 76498]]


0
46. Amend section 309.470-1 by revising the introductory text to read 
as follows:


309.470-1  Situations where reports are required.

    A report incorporating the information required by 309.470-2 shall 
be forwarded, in duplicate, by the Contracting Officer through 
acquisition channels to OAMP when:
* * * * *

0
47. Add part 311 to read as follows:

PART 311--DESCRIBING AGENCY NEEDS

    Authority: 5 U.S.C. 301; 40 U.S.C. 486(c).


311.003  Defining Electronic Information Technology (EIT) requirements.

    HHS officials who are defining agency needs for EIT products and 
services and performing market research to meet those needs can use the 
Buy Accessible Wizard (http://www.buyaccessible.gov) managed by the 
General Services Administration to document EIT requirements, identify 
the applicable Section 508 standards, and document the market research.

0
48. Add part 312 to read as follows:

PART 312--ACQUISITION OF COMMERCIAL ITEMS

    Authority: 5 U.S.C. 301; 40 U.S.C. 486(c).

Subpart 312.1--Acquisition of Commercial Items--General


312.101  Policy.

    (a) It is HHS policy to maximize its buying power, reduce 
acquisition administrative costs, and develop long-term, mutually 
beneficial, open partnerships with best-in-class providers of products 
and services. Accordingly, HHS has implemented a Strategic Sourcing 
Program under which Indefinite-Delivery/Indefinite-Quantity contracts 
(IDIQs) and Blanket Purchase Agreements (BPAs), known as HHS-wide 
Acquisition Contracts (HWACs), are awarded to allow for savings for 
commercial items and services across HHS and make the acquisition 
process more efficient.
    (b) If consideration is being given to soliciting or acquiring a 
product or service from a source, other than HHS Contract Closeout 
IDIQs or Strategic Sourcing BPAs, when the category of the current 
requirement (e.g. Lab Supplies, Events Management) is encompassed in 
the portfolio of existing IDIQ or BPA categories a waiver request must 
be prepared and approved in advance of a purchase or processing of a 
requirement.
    (c) The instructions, including approval requirements, and waiver 
form, are available at http://dbh.ogam2000.com/HHS_Strategic_Sourcing/Data_Collection/waiver.asp.
    The following links provide more detailed information regarding the 
supplies, equipment, and services in each of the HWACs: the HHS 
Acquisition Integration and Modernization Web site: http://intranet.hhs.gov/hwac/index.html and the HHS Strategic Sourcing Web 
site: http://intranet.hhs.gov/ssc/.

PART 314--SEALED BIDDING

0
49. Revise section 314.202-7 to read as follows:


314.202-7  Facsimile bids.

    (c) If the HCA (not delegable) has determined that the contracting 
activity will allow use of facsimile bids and proposals, the HCA shall 
prescribe internal procedures, in accordance with the FAR, to ensure 
uniform processing and control.


314.213  [Removed]

0
50. Remove section 314.213.

0
51. Revise section 314.404-1 to read as follows:


314.404-1  Cancellation of invitations after opening.

    (c) The HCA or CCO (not delegable) shall make the determinations 
required to be made by the agency head in FAR 14.404-1.

0
52. Revise section 314.407-3 to read as follows:


314.407-3  Other mistakes disclosed before award.

    (e) Authority has been delegated to the Departmental Protest 
Control Officer, Office of Acquisition Management and Policy, to make 
administrative determinations in connection with mistakes in bid 
alleged after opening and before award. This authority may not be 
redelegated.
    (f) Each proposed determination shall have the concurrence of the 
Chief, General Law Division, Office of General Counsel.
    (i) Doubtful cases shall not be submitted by the Contracting 
Officer directly to the Comptroller General, but, instead, shall be 
submitted to the Departmental Protest Control Officer.
0
53. Amend section 314.407-4 by revising paragraph (d) to read as 
follows:


314.407-4  Mistakes after award.

* * * * *
    (d) Each proposed determination shall have the concurrence of the 
Chief, General Law Division, Office of General Counsel.

PART 315--CONTRACTING BY NEGOTIATION

0
54. Add section 315.204-1 to read as follows:


315.204-1  Uniform contract format.

    (a) When preparing solicitations and resulting contracts, 
Contracting Officers/Contract Specialists are strongly encouraged to 
use as a guide the HHS Solicitation/Contract Structure Document found 
at http://www.knownet.hhs.gov/acquisition/policy.htm.


315.204-5  [Removed]

0
55. Remove section 315.204-5.


315.209  [Amended]

0
56. Amend section 315.209 by removing paragraph (g).
0
57. Amend section 315.305 by revising paragraphs (a)(1), (a)(3)(i)(D), 
(a)(3)(ii)(B), the introductory text of (a)(3)(ii)(E)(1), 
(a)(3)(ii)(E)(4), (a)(3)(ii)(F)(2), and (a)(3)(ii)(F)(3) to read as 
follows:


315.305  Proposal evaluation.

    (a)(1) Cost or price evaluation. (i) The Contracting Officer shall 
evaluate business proposals in accordance with the requirements set 
forth in FAR 15.404. The extent of cost or price analysis in each case 
depends on the contract type, the amount of the proposal, the technical 
complexity, and related cost or price. The Project Officer shall be 
requested to analyze the following elements, if applicable, to 
determine if they are necessary and reasonable for efficient contract 
performance:
    (A) The number of labor hours proposed for the various labor 
categories and the mix in relation to the technical requirements;
    (B) Types, numbers and hours/days of proposed consultants;
    (C) The kinds and quantities of material, equipment, supplies, and 
services;
    (D) Kinds and quantities of information technology;
    (E) Logic of proposed subcontracting; and
    (F) Travel proposed, including number of trips, locations, purpose, 
and travelers.
    (ii) The Project Officer shall provide written comments, including 
the rationale for any exceptions to the elements. The Project Officer's

[[Page 76499]]

comments shall be used for negotiations or to support award without 
discussions. The Contracting Officer should also request assistance of 
a cost/price analyst, when necessary. The Contracting Officer's 
negotiation memorandum must include the rationale used in determining 
that the price or cost is fair and reasonable.
* * * * *
    (3) Technical evaluation.
    (i) * * *
    (D) The technical evaluation plan shall be submitted to the 
Contracting Officer for review and approval before the solicitation is 
issued. The Contracting Officer shall make sure that the significant 
factors and subfactors relating to the evaluation are reflected in the 
evaluation criteria when conducting the review of the plan.
    (ii) * * *
    (B) Role of the Project Officer. (1) The Project Officer is the 
Contracting Officer's technical representative for the acquisition 
action. The Project Officer may be a voting member of the technical 
evaluation panel, and may also serve as the chairperson of the panel, 
unless prohibited by law or contracting activity procedures.
    (2) The Project Officer is responsible for recommending panel 
members who are knowledgeable in the technical aspects of the 
acquisition and capable of identifying strengths and weaknesses in the 
proposals received. Government employees serving as panel members must 
be selected in accordance with the requirements set forth in 307.170.
    (3) The Project Officer shall ensure that persons possessing 
expertise and experience in addressing issues relative to sex, race, 
national origin, and handicapped discrimination are included as panel 
members for acquisitions in which such issues are applicable.
    (4) The Project Officer shall submit the list of recommended panel 
members to an official within the project office in a position at least 
one level higher. This official will review the list and select the 
chairperson.
    (5) The Project Officer shall arrange for adequate and secure 
working space for the panel.
* * * * *
    (E) Continuity of evaluation process. (1) The technical evaluation 
panel shall evaluate all original proposals, make recommendations to 
the chairperson regarding strengths and weaknesses of proposals, and, 
if required by the Contracting Officer, assist the Contracting Officer 
during communications and discussions, and review supplemental, revised 
and/or final proposal revisions. To the extent possible, the same 
evaluators should be available throughout the entire evaluation and 
selection process to ensure continuity and consistency in the treatment 
of proposals. The following are examples of circumstances when it would 
not be necessary for the technical evaluation panel to evaluate revised 
proposals submitted during the acquisition:
* * * * *
    (4) When continuity of the evaluation process is not possible, and 
either new evaluators are selected or the size of the evaluation panel 
is reduced, all proposals shall be reviewed by each panel member at the 
current stage of the acquisition (i.e., initial proposal, final 
proposal revisions, etc.). Also, guidance should be provided concerning 
what to do if an unusually large number of proposals are received, 
including how to determine what constitutes an unusually large number 
of proposals.
    (F) * * *
    (2) Decisions to disclose proposals to evaluators outside of the 
Government shall be made by the official responsible for appointing 
panel members in accordance with operating division procedures. The 
avoidance of organization conflict of interest and competitive 
relationships must be taken into consideration when making the decision 
to use outside evaluators.
    (3) When it is determined to disclose a solicited proposal outside 
the Government for evaluation purposes, the following or similar 
conditions shall be included in the written agreement with evaluator(s) 
prior to disclosure:

Conditions for Evaluating Proposals

    The evaluator agrees to use the data (trade secrets, business 
data, and technical data) contained in the proposal for evaluation 
purposes only.
    The foregoing requirement does not apply to data obtained from 
another source without restriction.
    Any notice or legend placed on the proposal by either the 
Department or the submitter of the proposal shall be applied to any 
reproduction or abstract provided to the evaluator or made by the 
evaluator. Upon completion of the evaluation, the evaluator shall 
return to the Government the furnished copy of the proposal or 
abstract, and all copies thereof, to the Departmental office which 
initially furnished the proposal for evaluation.
    Unless authorized by the Department's initiating office, the 
evaluator shall not contact the submitter of the proposal concerning 
any aspects of its contents.
    The evaluator's employees and subcontractors shall abide by 
these conditions.
* * * * *


0
58. Amend section 315.371 by revising the introductory text of 
paragraph (a) to read as follows:


315.371  Contract preparation and award.

    (a) After details have been finalized with the selected offeror, 
the Contracting Officer shall:
* * * * *

0
59. Amend section 315.372 by revising the introductory text and 
paragraph (a) to read as follows:


315.372  Preparation of negotiation memorandum.

    The negotiation memorandum or summary of negotiations is a complete 
record of all actions leading to award of a contract and is prepared by 
the Contracting Officer/Contract Specialist to support the source 
selection decision discussed in FAR 15.308. It should be in sufficient 
detail to explain and support the rationale, judgments, and authorities 
upon which all actions were predicated. The memorandum will document 
the negotiation process and reflect the negotiator's actions, skills, 
and judgments in concluding a satisfactory agreement for the 
Government. The negotiation memorandum shall address each item listed 
below. If an item is not applicable, it shall be so stated in the 
memorandum. Information already contained in the contract file may be 
referenced rather than reiterated.
    (a) Description of articles and services and period of performance. 
A description of articles and services, quantity, unit price, total 
contract amount, and period of contract performance should be set 
forth.
* * * * *

0
60. Amend section 315.404-4 by revising paragraphs (b)(1), the 
introductory text of (b)(1)(ii), (c), (d)(1)(i), (d)(1)(ii), the 
introductory text of (d)(1)(iv), and (d)(3)(iv) to read as follows:


315.404-4  Profit.

    (b) Policy. (1) The structured approach for determining profit or 
fee (hereafter called profit) provides a technique for establishing a 
profit objective for negotiation. A profit objective is that part of 
the estimated contract price objective or value which, in the judgment 
of the Contracting Officer, constitutes an appropriate amount of profit 
for the acquisition being considered. This technique allows for 
consideration of the profit factors described in paragraph (d) of this 
section. The Contracting Officer's analysis of these factors is based 
on available information such as proposals, audit data, assessment 
reports, preaward

[[Page 76500]]

surveys, etc. The structured approach provides a basis for documenting 
the profit objective. Any significant departure from this objective 
shall be explained. The amount of documentation depends on the dollar 
value and complexity of the proposed acquisition. The profit objective 
is a part of the overall negotiation objective and is directly related 
to the cost objective and any proposed sharing arrangement. The profit 
objective should be negotiated at the same time as the other cost 
items. The profit objective should be negotiated as a whole and not as 
individual profit factors.
    (ii) The profit analysis factors in FAR 15.404-4(d) shall be used 
in lieu of the structured approach in the following circumstances. 
Factors considered inapplicable to the acquisition shall be excluded 
from the profit objective. Documentation shall be provided which 
includes the profit factor breakdown.
* * * * *
    (c) Contracting Officer responsibilities. The Contracting Officer 
shall develop the profit objective. This objective shall realistically 
reflect the total overall task to be performed and the requirements 
placed on the contractor. The Contracting Officer shall not begin to 
develop the profit objective until a thorough review of proposed 
contract work has been made; a review of all available knowledge 
regarding the contractor pursuant to FAR subpart 9.1, including audit 
data, preaward survey reports and financial statements, as appropriate, 
has been conducted; and an analysis of the contractor's cost estimate 
and comparison with the Government's estimate or projection of cost has 
been made.
    (d) * * *
    (1) * * *
    (i) The Contracting Officer shall measure ``Contractor Effort'' by 
assigning a profit percentage within the designated weight range to 
each element of contract cost. The categories listed are for reference 
purposes only, but are broad and basic enough to provide guidance to 
other elements of cost. Facilities capital cost of money is not to be 
included. A total dollar profit shall be computed for ``Contractor 
Effort.''
    (ii) The Contracting Officer shall use the total dollar profit for 
the ``Contractor Effort'' to calculate specific profit dollars for 
``Other Factors''--cost risk, investment, performance, socioeconomic 
programs, and special situations. The Contracting Officer shall 
multiply the total dollar profit for the ``Contractor Effort'' by the 
weight assigned to each of the elements in the ``Other Factors'' 
category. Facilities capital cost of money is not included. Form HHS-
674, Structured Approach Profit/Fee Objective, should be used. Form 
HHS-674 is illustrated in 353.370-674.
* * * * *
    (iv) The structured approach was designed for arriving at profit 
objectives for other than nonprofit organizations. However, the 
structured approach can be used for nonprofit organizations if 
appropriate adjustments are made. The Contracting Officer shall use the 
modified structured approach in paragraph (d)(1)(iv)(B) of this section 
to establish profit objectives for nonprofit organizations.
* * * * *
    (3) * * *
    (iv) Federal socioeconomic programs. This factor, which may apply 
to special circumstances or particular acquisitions, relates to the 
extent of a contractor's successful participation in Government 
sponsored programs such as small business, small disadvantaged 
business, women-owned small business, service-disabled veterans, 
handicapped sheltered workshops, and energy conservation efforts. The 
contractor's policies and procedures which energetically support 
Government socioeconomic programs and achieve successful results should 
be given positive considerations. Conversely, failure or unwillingness 
on the part of the contractor to support Government socioeconomic 
programs should be viewed as evidence of poor performance for the 
purpose of establishing a profit objective.
* * * * *

0
61. Amend section 315.606 by revising paragraph (b) to read as follows:


315.606  Agency procedures.

* * * * *
    (b) The HCA or the HCA's designee shall be the point of contact for 
coordinating the receipt and handling of unsolicited proposals.

0
62. Amend section 315.609 by revising the introductory text to read as 
follows:


315.609  Limited use of data.

    The legend, Use and Disclosure of Data, prescribed in FAR 15.609(a) 
is to be used by the offeror to restrict the use of data for evaluation 
purposes only. However, data contained within the unsolicited proposal 
may have to be disclosed as a result of a request submitted pursuant to 
the Freedom of Information Act. Because of this possibility, the 
following notice shall be provided to all prospective offerors of 
unsolicited proposals:
* * * * *

PART 316--TYPES OF CONTRACTS

0
63. Add section 316.505 to read as follows:


316.505  Ordering.

    (b)(5) The Department's task-order and delivery-order ombudsman is 
the Director, Strategic Acquisition Service, Program Support Center 
(PSC). The task-order and delivery-order ombudsmen for each of the 
Department's contracting activities are as follows:

AHRQ--Director, Office of Performance Accountability, Resources and 
Technology
CDC--Chief Information Officer
CMS--Chief Operating Officer
FDA--Director, Office of Acquisitions and Grants Services
HRSA--Associate Administrator, Office of Administration and Financial 
Management
Indian Health Service--Director, Office of Management Services
NIH--Senior Scientific Advisor for Extramural Research, Office of 
Extramural Research (R&D) and Senior Advisor to the Director (Other 
than R&D)
PSC--Director, Strategic Acquisition Service
SAMHSA--Executive Officer

0
64. Revise section 316.603-3 to read as follows:


316.603-3  Limitations.

    An official one level above the Contracting Officer shall make the 
written determination.


316.770-1  [Removed]

0
65. Remove section 316.770-1.

PART 319--SMALL BUSINESS PROGRAMS

0
66. Amend section 319.201 by revising paragraph (e) to read as follows:


319.201  General policy.

* * * * *
    (e)(1) The Department's Small Business Program shall be carried out 
by appointed small business specialists (SBS) co-located within the 
OPDIVs. Appointments, and termination of appointments, shall be made in 
writing by the Director, Office of Small and Disadvantaged Business 
Utilization (OSDBU). The Director, OSDBU, will exercise full management 
authority over small business specialists.
    (2) One or more qualified SBS shall be appointed in the following 
activities:

[[Page 76501]]

Agency for Healthcare Research and Quality (AHRQ), Centers for Medicare 
& Medicaid Services (CMS), Substance Abuse and Mental Health Services 
Administration (SAMHSA), Food and Drug Administration (FDA), Health 
Resources and Services Administration (HRSA), Indian Health Service 
(IHS), National Institutes of Health (NIH), Centers for Disease Control 
(CDC), Program Support Center (PSC), and the Office of the Secretary 
(OS).

0
67. Revise section 319.501 to read as follows:


319.501  General.

    (e) Subsequent to the Contracting Officer's recommendation on Form 
HHS-653, Small Business Set-Aside Review Form, the SBS shall review 
each proposed acquisition strategy and either concur or non-concur with 
the Contracting Officer's recommendation. The Small Business 
Administration's Procurement Center Representative (SBA/PCR) shall also 
review the acquisition strategy and either concur or non-concur with 
the Contracting Officer's recommendation. If the Contracting Officer 
disapproves the SBS's and/or the SBA PCR's set-aside recommendation, 
the reasons must be documented on the Form HHS-653, and the form placed 
in the contract file. The Contracting Officer will make the final 
determination as to whether the proposed acquisition will be set-aside 
or not.

0
68. Revise the heading of part 323 to read as follows:

PART 323--ENVIRONMENT, ENERGY AND WATER EFFICIENCY, RENEWABLE 
ENERGY TECHNOLOGIES, OCCUPATIONAL SAFETY, AND DRUG-FREE WORKPLACE

PART 324--PROTECTION OF PRIVACY AND FREEDOM OF INFORMATION

0
69. Amend section 324.103 by revising paragraphs (a), (b), and (c) to 
read as follows:


324.103  Procedures.

    (a) All requests for contract shall be reviewed by the contracting 
officer to determine whether the Privacy Act requirements are 
applicable. The Privacy Act requirements are applicable when the 
contract will require the contractor to design, develop, or operate any 
Privacy Act system of records on individuals to accomplish an agency 
function. When applicable, the contracting officer shall include the 
solicitation notification and contract clause required by FAR 24.104 in 
the solicitation, and the contract clause in the resultant contract. In 
addition, the contracting officer shall ensure that the solicitation 
notification, contract clause, and other pertinent information 
specified in this subpart are included in any contract modification 
which results in the Privacy Act requirements becoming applicable to a 
contract.
    (b)(1) The Contracting Officer shall identify in the contract work 
statement the system(s) of records to which the Privacy Act and the 
implementing regulations are applicable.
    (2) The Contracting Officer shall include the clause specified in 
352.270-11 in Section H of any RFP or resulting contract to notify the 
contractor that it and its employees are subject to criminal penalties 
for violations of the Act (5 U.S.C. 552a(i)) to the same extent as HHS 
employees. The clause also requires that the contractor ensure that 
each of its employees knows the prescribed rules of conduct and each 
contractor employee is aware that he/she is subject to criminal 
penalties for violations of the Act. These provisions also apply to all 
subcontracts awarded under the contract which require the design, 
development or operation of a system of records. The Contracting 
Officer shall send the contractor a copy of 45 CFR part 5b, which 
includes the rules of conduct and other Privacy Act requirements.
    (c) The Contracting Officer shall specify in the contract work 
statement and award the disposition to be made of the system(s) of 
records upon completion of contract performance. The contract work 
statement may require the contractor to destroy the records, remove 
personal identifiers, or turn the records over to the Contracting 
Officer. If there is a legitimate need for a contractor to keep copies 
of the records after completion of a contract, the contractor must take 
measures, as approved by the Contracting Officer, to keep the records 
confidential and protect the individuals' privacy.
* * * * *


324.202  [Redesignated as 324.203]

0
70-A. Redesignate section 324.202 as section 324.203.
0
70-B. Amend section 324.203 by revising paragraph (b) to read as 
follows:


324.203  Policy.

* * * * *
    (b) The Contracting Officer, upon receiving a Freedom of 
Information Act (FOIA) request, shall follow Department and OPDIV 
procedures. As necessary, actions should be coordinated with the 
cognizant Freedom of Information (FOI) Officer and the General Law 
Division of the Office of General Counsel. The Contracting Officer must 
remember that only the FOI Officer has the authority to release or deny 
release of records. While the Contracting Officer should be familiar 
with the entire FOIA regulation in 45 CFR part 5, particular attention 
should be focused on Sec. Sec.  5.65 and 5.66; also of interest are 
Sec. Sec.  5.32, 5.33, and 5.35.

PART 325--[REMOVED]

0
71. Remove part 325.

PART 330--COST ACCOUNTING STANDARDS

0
72. Revise section 330.201-5 to read as follows:


330.201-5  Waiver.

    (c) The requirements of FAR 30.201-5 shall be exercised by the 
Director, Division of Acquisition Policy (DAP). Requests shall be 
forwarded through normal acquisition channels to the DAP.

PART 332--CONTRACT FINANCING

0
73. Revise section 332.402 to read as follows:


332.402  General.

    (e) The HCA shall determine whether an advance payment is in the 
public interest in accordance with FAR 32.402(c)(1)(iii)(A). This 
authority is non delegable.

0
74. Amend section 332.407 by revising the introductory text of 
paragraph (d) to read as follows:


332.407  Interest.

    (d) The HCA (not delegable) is authorized to make the 
determinations in FAR 32.407(d) and as follows. Interest-free advance 
payments may also be approved for educational institutions and other 
nonprofit organizations, whether public or private, performing work 
under nonprofit contracts (without fee) involving health services, 
educational programs, or social service programs, such as:
* * * * *

0
75. Revise section 332.501-2 to read as follows:


332.501-2  Unusual progress payments.

    (a)(3) The approval of an unusual progress payment shall be made by 
the HCA (not delegable).

0
76. Revise section 332.702 to read as follows:


332.702  Policy.

    An incrementally funded contract is a multiple year contract in 
which funds are allocated to cover specific phases or increments of 
performance.

[[Page 76502]]

    (a) Incremental funding may be used in cost-reimbursement type 
contracts for the acquisition of severable services. It shall not be 
used in contracts for construction or architect-engineer services. 
Incremental funding allows severable cost-reimbursement type contracts 
awarded for more than one year to be funded from succeeding fiscal 
years.
    (b) It is Departmental policy that multiple year contracts be fully 
funded whenever possible. However, incrementally funded contracts may 
be used when:
    (1) A project, which is part of an approved program, is anticipated 
to be of multiple year duration, but funds are not currently available 
to cover the entire project;
    (2) The project represents a valid need for the fiscal year in 
which the contract is awarded and for the succeeding fiscal years of 
the project's duration;
    (3) The project is so significant to the approved program that 
there is reasonable assurance that it will command a high priority for 
proposed appropriations to cover the entire multiple year duration; and
    (4) The statement of work is specific and is defined by separate 
phases or increments so that, at the completion of each, progress can 
be effectively measured.

0
77. Revise section 332.703-1 to read as follows:


332.703-1  General.

    (b) The following general guidelines are applicable to 
incrementally funded contracts:
    (1) The estimated total cost of the project (all planned phases or 
increments) is to be taken into consideration when determining the 
requirements which must be met before entering into the contract; i.e., 
justification for noncompetitive acquisition, approval of award, etc.
    (2) The RFP and resultant contract are to include a statement of 
work which describes the total project covering the proposed multiple 
year period of performance and indicating timetables consistent with 
planned phases or increments and corresponding allotments of funds.
    (3) Offerors' technical and cost proposals must include the entire 
project and shall show distinct phases or increments and the multiple 
year period of performance.
    (4) Negotiations will be conducted based upon the total project, 
including all planned phases or increments, and the multiple year 
period of performance.
    (5) Sufficient funds must be obligated under the basic contract to 
cover no less than the first year of performance, unless the 
Contracting Officer determines it is advantageous to the Government to 
fund the contract for a lesser period. In that event, the Contracting 
Officer shall ensure that the obligated funds are sufficient to cover a 
complete phase or increment of performance representing a material and 
measurable part of the total project and the period of time that the 
funds cover shall be stated in the contract.
    (6) An incrementally funded contract must contain precise 
requirements for progress reports to be sent to the Project and 
Contracting Officers. These reports will enable the contract to be 
effectively monitored. The Project Officer shall prepare periodic 
performance evaluation reports and provide them to the Contracting 
Officer.

0
78. Revise section 332.704 to read as follows:


332.704  Limitation of cost or funds.

    See subpart 342.71, ``Administrative Actions for Cost Overruns,'' 
for procedures for handling anticipated cost overruns.


332.705  [Removed]

0
79. Remove section 332.705.


332.902  [Removed]

0
80. Remove section 332.902.

PART 333--PROTESTS, DISPUTES, AND APPEALS


333.102  [Amended]

0
81. Amend section 333.102 by removing paragraph (a).

0
82. Amend section 333.103 by revising paragraph (f)(3) to read as 
follows:


333.103  Protests to the agency.

    (f) * * *
    (3) Protests received after award shall be treated as indicated in 
FAR 33.103(f)(3).

0
83. Revise section 333.104 to read as follows:


333.104  Protests to GAO.

    (a) General procedures. (3)(ii) The DPCO shall process protests 
filed with GAO, whether pre- or post award. Protest files shall be 
prepared by the contracting office and distributed as follows: Two 
copies to the DPCO, one copy to the contracting activity's protest 
control officer, and one copy to OGC-GLD. In addition to the items 
listed in 33.104(a)(3)(ii)(A) through (G), the protest file shall 
include the following documents:
    (H) The current status of award. When award has been made, this 
shall include whether performance has commenced, shipment or delivery 
has been made, or a stop work order has been issued.
    (I) A copy of any mutual agreement to suspend work on a no-cost 
basis, when appropriate (see FAR 33.104(c)(4)).
    (J) Copies of the notice of protest given offerors and other 
parties when the notice is appropriate (see FAR 33.104(a)(2)).
    (K) A copy of the negotiation memorandum, when applicable.
    (L) The name and telephone number of the person in the contracting 
office who may be contacted for information relevant to the protest.
    (M) A copy of the competitive range memorandum.
    (N) The contracting officer's statement of facts and circumstances, 
including a discussion of the merits of the protest, and conclusions 
and recommendations, including documentary evidence on which they are 
based. The files shall be assembled in an orderly manner and shall have 
an index of enclosures and any document referred to therein.
    (4) The DPCO is responsible for making the necessary distributions 
referenced in FAR 33.104(a)(4).
    (5) The Contracting Officer shall furnish the protest file 
containing the documentation specified in paragraph (a)(3)(ii) of this 
section (with the exception of the contracting officer statement of 
facts and circumstances) and FAR 33.104(a)(3)(ii)(A) through (G) to the 
DPCO within fourteen (14) calendar days from receipt of the protest. 
The contracting officer shall submit the contracting officer's 
statement of facts and circumstances within twenty-one (21) calendar 
days from receipt of the protest. Since the statute allows only a short 
time period in which to respond to protests lodged with GAO, the 
Contracting Officer shall handle each protest on a priority basis. The 
DPCO shall submit copies of the protest file to GAO, the protestor, and 
any intervenors in accordance with FAR 33.104(a)(4)(i).
    (6) Since the DPCO will furnish the protest file to GAO, the 
protestor, and any intervenors, comments on the file from the protestor 
and any intervenors will be sent to the DPCO.
    (7) The DPCO, Division of Acquisition Policy (DAP), shall serve as 
the GAO point of contact for protests lodged with GAO.
    (b) Protests before award. (1) To make an award notwithstanding a 
protest, the Contracting Officer shall prepare a finding using the 
criteria in FAR 33.104(b)(1), have it executed by the HCA (not 
delegable), and forward it, along with a written request for approval 
to make the award, to the

[[Page 76503]]

Deputy Assistant Secretary for Acquisition Management and Policy 
(DASAMP).
    (2) If the request to make an award notwithstanding the protest is 
approved by the Deputy Assistant Secretary for Acquisition Management 
and Policy (DASAMP), the DPCO shall notify GAO. Whether the request is 
approved or not, the DPCO shall telephonically notify the contracting 
activity's protest control officer of the decision of the Deputy 
Assistant Secretary for Acquisition Management and Policy (DASAMP), and 
the contracting activity's protest control officer shall immediately 
notify the Contracting Officer. The DPCO shall confirm the decision by 
memorandum to the contracting activity's protest control officer.
    (c) Protests after award. (2) If the Contracting Officer believes 
performance should be allowed to continue notwithstanding the protest, 
a finding shall be prepared by the Contracting Officer using the 
criteria in FAR 33.104(c)(2), executed by the HCA (not delegable), and 
forwarded, along with a written request for approval, to the Deputy 
Assistant Secretary for Acquisition Management and Policy (DASAMP). The 
same procedures for notification stated in paragraph (b)(2) of this 
section shall be followed.
    (d) Findings and notice. The written notice required by FAR 
33.104(d) shall be provided to the protestor and any intervenors by the 
DPCO.
    (g) Notice to GAO. The Deputy Assistant Secretary for Acquisition 
Management and Policy (DASAMP) shall be the official to comply with the 
requirements of FAR 33.104(g).

0
84. Revise section 333.203 to read as follows:


333.203  Applicability.

    (c) The Secretary has designated the Armed Services Board of 
Contract Appeals (ASBCA) as the authorized ``Board'' to hear and 
determine disputes for the Department.

0
85. Revise section 333.211 to read as follows:


333.211  Contracting officer's decision.

    (a)(2) The contracting officer shall refer a proposed final 
decision to the Office of General Counsel-General Law Division (OGC-
GLD), for advice as to the legal sufficiency and format before sending 
the final decision to the contractor. The contracting officer shall 
provide OGC-GLD with the pertinent documents with the submission of 
each proposed final decision.
    (a)(4)(v) When using the paragraph in FAR 33.211 (a)(4)(v), the 
contracting officer shall insert the words ``Armed Services'' before 
each mention of the term ``Board of Contract Appeals''.
    (h) At any time within the period of appeal, the contracting 
officer may modify or withdraw his/her final decision. If an appeal 
from the final decision has been taken to the ASBCA, the contracting 
officer will forward his/her recommended action to OGC-GLD with the 
supplement to the contract file which supports the recommended 
correction or amendment.

0
86. Revise section 333.212 to read as follows:


333.212  Contracting officer's duties upon appeal.

    (a) Appeals shall be governed by the rules set forth in the ``Rules 
of the Armed Services Board of Contract Appeals,'' or by the rules 
established by the U.S. Court of Federal Claims, as appropriate.
    (b) The Office of General Counsel-General Law Division (OGC-GLD) is 
designated as the Government Trial Attorney to represent the Government 
in the defense of appeals before the ASBCA. A decision by the ASBCA 
will be transmitted by the Government Trial Attorney to the appropriate 
contracting officer for compliance in accordance with the ASBCA's 
decision.
    (c) If an appeal is filed with the ASBCA, the contracting officer 
shall assemble a file within 30 days of receipt of an appeal, or advice 
that an appeal has been filed, that consists of all documents pertinent 
to the appeal, including:
    (1) The decision and findings of fact from which the appeal is 
taken;
    (2) The contract, including specifications and pertinent 
modifications, plans and drawings;
    (3) All correspondence between the parties pertinent to the appeal, 
including the letter or letters of claim in response to which the 
decision was issued;
    (4) Transcripts of any testimony taken during the course of 
proceedings, and affidavits or statements of any witness on the matter 
in dispute made prior to the filing of the notice of appeal with the 
Board; and
    (5) Any additional information considered pertinent. The 
contracting officer shall furnish the appeal file to the Government 
Trial Attorney for review and approval. After approval, the contracting 
officer shall prepare four copies of the file, one for the ASBCA, one 
for the appellant, one for the Government Trial Attorney, and one for 
the contracting office.
    (d) At all times after the filing of an appeal, the contracting 
officer shall render whatever assistance is requested by the Government 
Trial Attorney. When an appeal is set for hearing, the concerned 
contracting officer shall be responsible for providing Government 
witnesses and specified physical and documentary evidence to the Trial 
Attorney. The Trial Attorney shall ensure the presence of all witnesses 
and documentary evidence at both the pre-hearing conference and 
hearing.
    (e) If a contractor which has filed an appeal with the ASBCA elects 
to accept fully the decision from which the appeal was taken, or any 
modification to it, and gives written notification of acceptance to the 
Government Trial Attorney or the concerned contracting officer, the 
Government Trial Attorney will notify the ASBCA of the disposition of 
the dispute in accordance with Rule 27 of the ASBCA.
    (f) If the contractor has elected to appeal to the U.S. Court of 
Federal Claims, the U.S. Department of Justice will represent the 
Department. However, the contracting officer shall still coordinate all 
actions through OGC-GLD.

0
87. Amend section 333.212-70 by revising paragraph (a) to read as 
follows:


333.212-70  Formats.

    (a) The following format is suggested for use in transmitting 
appeal files to the ASBCA:

Your reference:
(Docket No.)
(Name)
Recorder, Armed Services Board of Contract Appeals
Skyline Six 5109 Leesburg Pike
Falls Church, Virginia 22041

Dear (Name):
Transmitted herewith are documents relative to the appeal under 
Contract No. ---- with the ------------
(Name of contractor)
in accordance with the procedures under Rule 4. The Government Trial 
Attorney for this case is
(Insert General Law Division, Office of General Counsel, Department 
of Health and Human Services, 330 Independence Avenue, SW., 
Washington, DC 20201).
The request for payment of charges resulting from the processing of 
this appeal should be addressed to:
(Insert name and address of cognizant finance office.)

Sincerely yours,

Contracting Officer
Enclosures
* * * * *

PART 334--[REMOVED]

0
88. Remove part 334.

[[Page 76504]]

PART 335--RESEARCH AND DEVELOPMENT CONTRACTING

0
89. Amend section 335.070-2 by revising the introductory text and 
paragraph (a) to read as follows:


335.070-2  Amount of cost-sharing.

    When cost-sharing is appropriate, use the following guidelines to 
determine the amount of cost participation by the contractor:
    (a) The amount of cost participation should depend on the extent to 
which the research effort or results are likely to enhance the 
performing organization's capability, expertise, or competitive 
position, and the value of this enhancement to the performing 
organization. It should be recognized that those organizations which 
are predominantly engaged in research and development have little or no 
production or other service activities and may not be in a favorable 
position to derive a monetary benefit from their research under Federal 
agreements. Therefore, contractor cost participation could reasonably 
range from as little as 1 percent or less of the total project cost, to 
more than 50 percent of the total project cost. Ultimately, the 
Contracting Officer should bear in mind that cost-sharing is a 
negotiable item. As such, the amount of cost-sharing should be 
proportional to the anticipated value of the contractor's gain.
* * * * *

0
90. Add part 339 to read as follows:

PART 339--ACQUISITION OF INFORMATION TECHNOLOGY

    Authority: 5 U.S.C. 301; 40 U.S.C. 486(c).


339.201-10  Clarification.

    FAR Subpart 39.2, Electronic and Information Technology, requires 
Federal agencies to ensure that, when acquiring EIT, Federal employees 
with disabilities and members of the public with disabilities have 
access to and use of information and data that is comparable to 
individuals without disabilities. This EIT access requirement does not 
apply to a contractor's internal workplaces. EIT that is not used nor 
accessed by Federal employees or members of the public is not subject 
to the Architectural and Transportation Barriers Compliance Board 
(Access Board) standards. Contractors in their professional capacity 
are not members of the public for purposes of Section 508.


339.201-70  Required provision and contract clause.

    When acquiring EIT, the Contracting Officer shall insert the 
provision at 352.270-19(a) in solicitations and the clause in 352.270-
19(b) in contracts and orders for projects that will develop, purchase, 
maintain, or use electronic and information technology (EIT), unless 
these EIT products and/or services are incidental to the project. 
(Note: Other exceptions to this requirement can be found at FAR 
39.204.)

PART 342--CONTRACT ADMINISTRATION

0
91. Revise section 342.705 to read as follows:


342.705  Final indirect cost rates.

    (a) The Director, Division of Cost Allocation of the Program 
Support Center, within each servicing HHS regional office, has been 
delegated the authority to establish indirect cost rates, research 
patient care rates, and, as necessary, fringe benefit, computer, and 
other special costing rates for use in contracts and grants awarded to 
State and local governments, colleges and universities, hospitals, and 
other nonprofit organizations.
    (b) The Division of Financial Advisory Services of the National 
Institutes of Health has the authority to establish indirect cost 
rates, fringe benefit rates, etc., for use in contracts and grants 
awarded to commercial organizations.
0
92. Revise section 342.7001 to read as follows:


342.7001  Purpose.

    Contract monitoring is an essential element of contract 
administration and is performed jointly by the Project Officer and the 
Contracting Officer. This subpart describes the Department's operating 
concepts.

0
93. Revise section 342.7002 to read as follows:


342.7002  Contract monitoring responsibilities.

    (a) The contract establishes the obligations of both the Government 
and the contractor. The Contracting Officer is the only person 
authorized to make changes to the contract. The Contracting Officer 
must confirm all changes in writing.
    (b) The Contracting Officer is responsible for assuring compliance 
with all the terms and conditions of the contract. The Contracting 
Officer shall inform the contractor by letter (if not already 
stipulated in the contract) of the authorities and responsibilities of 
the Government personnel involved with the contract.
    (c) The Contracting Officer must depend on program, technical, and 
other personnel for assistance and advice in monitoring the 
contractor's performance, and in other areas of postaward 
administration. The Contracting Officer must assure that these 
individuals understand and carry out their assigned responsibilities. 
The individual roles and corresponding responsibilities typically 
involve, but are not limited to, the following:
    (1) The role of program and technical personnel in monitoring the 
contract is to assist and/or advise the Contracting Officer or act as 
his/her representative when so designated by the Contracting Officer. 
Activities may include:
    (i) Providing technical monitoring during contract performance, and 
issuing letters to the contractor and Contracting Officer relating to 
delivery, acceptance, or rejection in accordance with the terms of the 
contract;
    (ii) Assessing contractor performance, including inspection and 
testing of products and evaluation of reports and data;
    (iii) Recommending necessary changes to the schedule of work and 
period of performance in order to accomplish the objectives of the 
contract. Program officials must provide the Contracting Officer a 
written request along with an appropriate justification and a funding 
document if additional funds are needed;
    (iv) Reviewing invoices/vouchers and recommending approval/
disapproval action by the Contracting Officer, to include comments 
regarding anything unusual discovered in the review;
    (v) Reviewing and recommending approval or disapproval of 
subcontractors, overtime, travel, and key personnel changes; and
    (vi) Participating, as necessary, in various phases of the contract 
closeout process.
    (2) The role of the Project Officer in monitoring the contract 
includes the applicable activities set forth in paragraph (c)(1) of 
this section. The Project Officer also shall do the following:
    (i) Submit periodic reports to the Contracting Officer that 
concisely explain the status of the contract, and include recommended 
actions for any problems reported. Provide the Contracting Officer with 
written notification of evaluation and approval/disapproval of contract 
deliverables and of completion of tasks or phases. The Contracting 
Officer or designee will provide the contractor with written

[[Page 76505]]

notification of approval or disapproval and include a copy in the 
contract file;
    (ii) Monitor the technical aspects of the contract, identify 
existing and potential problems that threaten performance, and 
immediately inform the Contracting Officer of deviations from contract 
objectives or from any technical or delivery requirements;
    (iii) Immediately notify the head of the program office whenever it 
is determined that objectives are not being met and provide specific 
recommendations of actions to be taken. The Contracting Officer shall 
receive a copy of the Project Officer's report and recommendations;
    (iv) Within 120 days after contract completion, submit a final 
written assessment report to the Contracting Officer. The report should 
include analysis of the contractor's performance, including the 
contract and program objectives achieved and missed. A copy of the 
final assessment report shall be forwarded to the head of the program 
office responsible for the program for management review and follow-up, 
as necessary; and
    (v) Accompany and/or provide, when requested, technical support to 
the HHS auditor in the conduct of visual inspections.
    (3) The roles of the contract administrator, auditor, cost analyst, 
and property administrator are to assist and/or advise the Contracting 
Officer in postaward administration activities such as:
    (i) Evaluation of contractor systems and procedures, to include 
accounting policies and procedures, purchasing policies and practices, 
property accounting and control, wage and salary plans and rate 
structures, personnel policies and practices, etc.;
    (ii) Processing of disputes under the Disputes clause and any 
resultant appeals;
    (iii) Modification or termination of the contract; and
    (iv) Determination of the allowability of cost charges to incentive 
or cost-reimbursement type contracts and progress payments under fixed-
price contracts. This is especially important when award is made to new 
organizations or those with financial weaknesses.
    (d) The Contracting Officer is responsible for assuring that 
contractor performance and contract monitoring conform with contract 
terms. If performance is not satisfactory or if problems are 
anticipated, it is essential that the Contracting Officer take 
immediate action to protect the Government's rights under the contract. 
The Contracting Officer shall notify his/her immediate supervisor of 
problems that cannot be resolved within contract limitations and 
whenever contract or program objectives are not met. The notification 
shall include a statement of action being taken by the Contracting 
Officer.

0
94. Revise section 342.7003-1 to read as follows:


Sec.  342.7003-1  Policy.

    (a) All solicitations and resultant contracts (other than awards 
made using simplified acquisition procedures) shall contain the 
withholding of contract payments clause at 352.232-9, and an excusable 
delays clause, or a clause which incorporates the definition of 
excusable delays. Use the excusable delays clause at 352.249-14 when 
the solicitation and resultant contract (other than purchase orders) 
does not contain a default or other excusable delays clause.
    (b) When appropriate, the Contracting Officer may withhold any 
contract payment when a required report is overdue, or the contractor 
fails to perform or deliver required work or services.

0
95. Revise section 342.7003-2 to read as follows:


Sec.  342.7003-2  Procedures.

    (a) The Contracting Officer is responsible for initiating immediate 
action to protect the Government's rights whenever the contractor fails 
to comply with either the delivery or reporting terms of the contract. 
Compliance with the reporting terms includes those reports to be 
submitted directly to the payment office. The payment office shall 
notify the Contracting Officer promptly when such a report is not 
submitted on time.
    (b) When the contract contains a termination for default clause, 
the contractor's failure to submit any report, perform services, or 
deliver work when required by the contract is considered a default in 
performance. The Contracting Officer shall immediately issue a formal 
ten-day cure notice pursuant to FAR 49.607. The notice shall include a 
statement to the effect that payments will be withheld if the default 
is not cured within the time frame specified in the notice or if the 
default is not determined to be excusable.
    (1) If the default is cured or is determined to be excusable, the 
Contracting Officer shall not initiate the withholding action.
    (2) If the default is not determined to be excusable or a response 
is not received within the allotted time, the Contracting Officer shall 
initiate withholding action on all contract payments and shall 
determine whether termination for default or other action would be in 
the best interest of the Government.
    (c) When the contract does not contain a termination for default 
clause, the contractor's failure to submit any required report, perform 
services, or deliver work when required by the contract shall be 
considered a failure to perform. The Contracting Officer shall 
immediately issue a written notice to the contractor specifying the 
failure and providing a ten-day period (or longer period if the 
Contracting Officer deems it necessary) in which the contractor shall 
cure the failure or provide reasons for an excusable delay. The notice 
shall include a statement to the effect that payments will be withheld 
if the default is not cured within the time specified in the notice or 
if the default is not determined to be excusable.
    (1) If the failure is cured or is determined to be excusable, the 
Contracting Officer shall not initiate the withholding action.
    (2) If the failure is not determined to be excusable or a response 
is not received within the allotted time, the Contracting Officer shall 
initiate withholding action on all contract payments and shall 
determine whether termination for convenience or other action would be 
in the best interest of the Government.
    (d) The Contracting Officer should consult FAR subpart 49.4 for 
further guidance before taking any of the actions described in this 
section.

0
96. Revise section 342.7003-3 to read as follows:


Sec.  342.7003-3  Withholding payments.

    (a) When making the determination that contract payments should be 
withheld in accordance with the Withholding of Contract Payments 
clause, the Contracting Officer shall immediately notify the servicing 
finance office in writing of the determination to withhold payments. 
The notice of suspension shall contain all information necessary for 
the finance office to identify the contract, i.e., contract number, 
task/delivery order number, contractor name and address, etc.
    (b) The Contracting Officer shall immediately notify the contractor 
in writing that payments have been suspended until the default or 
failure is cured.
    (c) When the contractor cures the default or failure, the 
Contracting Officer shall immediately notify, in writing, all 
recipients of the notice of suspension that the suspension is to be 
lifted and contract payments are to be resumed.

[[Page 76506]]

    (d) When exercising actions regarding the withholding of payment 
procedures, the Contracting Officer must be careful not to waive any of 
the Government's rights when corresponding with the contractor or when 
taking any other actions.

0
97. Revise section 342.7100 to read as follows:


Sec.  342.7100  Scope of subpart.

    This subpart sets forth the procedures to follow when a cost 
overrun is anticipated. A cost overrun occurs when the allowable actual 
cost of performing a cost-reimbursement type contract exceeds the total 
estimated cost specified in the contract.

0
98. Amend section 342.7101-2 by revising the introductory text of 
paragraph (a) and paragraph (b)(3) to read as follows:


Sec.  342.7101-2  Procedures.

    (a) Upon notification that a cost overrun is anticipated, the 
Contracting Officer shall inform the contractor to submit a request for 
additional funds which shall include:
* * * * *
    (b) * * *
    (3) Maintain continuous follow-up with the program office to obtain 
a timely decision as to whether the work under the contract should 
continue and additional funds be provided, or the contract terminated. 
An appropriate written statement and funding authority, or a formal 
request for termination, must support the decision of the program 
office. After receiving the decision by the program office, the 
Contracting Officer shall promptly notify the contractor in writing of 
the following:
    (i) The specified amount of additional funds allotted to the 
contract; or
    (ii) Work will be discontinued when the allotted funds are 
exhausted, and any work performed after that date is at the 
contractor's risk; or
    (iii) The Government is considering whether to allot additional 
funds to the contract and will notify the contractor as soon as 
possible, but that any work performed after the currently allotted 
funds are exhausted is at the contractor's risk. Timely, formal 
notification of the Government's intention is essential in order to 
preclude loss of contractual rights in the event of dispute, 
termination, or litigation.
* * * * *

PART 352--SOLICITATION PROVISIONS AND CONTRACT CLAUSES

0
99. Revise section 352.202-1 to read as follows:


Sec.  352.202-1  Definitions.

    As prescribed in 302.201, use the FAR Definitions clause at 52.202-
1 as modified:

Definitions (January 2006)

    (a) In accordance with 52.202-1(a)(1), substitute the following 
as paragraph (a):
    ``(a) The term ``Secretary'' or ``Head of the Agency'' (also 
called ``Agency Head'') means the Secretary, Deputy Secretary, or 
any Assistant Secretary, Administrator or Commissioner of the 
Department of Health and Human Services; and the term ``his/her duly 
authorized representative'' means any person, persons, or board 
authorized to act for the Secretary.''
    (b) In accordance with 52.202-1(a)(1), add the following 
paragraph (h):
    ``(h) The term ``Project Officer'' means the person who monitors 
the technical aspects of contract performance. The Project Officer 
is not authorized to issue any instructions or directions which 
cause any increase or decrease in the scope of work which would 
result in the increase or decrease in the price of this contract, or 
changes in the delivery schedule or period of performance of this 
contract. If applicable, the Project Officer is not authorized to 
receive or act upon any notification or revised cost estimate 
provided by the Contractor in accordance with the Limitation of Cost 
or Limitation of Funds clauses of this contract.''

0
100. Revise section 352.215-1 to read as follows:


Sec.  352.215-1  Instructions to offerors--Competitive acquisition.

    Insert the following paragraph (e) in place of paragraph (e) of the 
provision at FAR 52.215-1:

    (e) Restriction on disclosure and use of data. (1) The proposal 
submitted in response to this request may contain data (trade 
secrets; business data, e.g., commercial information, financial 
information, and cost and pricing data; and technical data) which 
the offeror, including its prospective subcontractor(s), does not 
want used or disclosed for any purpose other than for evaluation of 
the proposal. The use and disclosure of any data may be so 
restricted; provided, that the Government determines that the data 
is not required to be disclosed under the Freedom of Information 
Act, 5 U.S.C. 552, as amended, and the offeror marks the cover sheet 
of the proposal with the following statements, specifying the 
particular portions of the proposal which are to be restricted: 
``Unless disclosure is required by the Freedom of Information Act, 5 
U.S.C. 552, as amended, (the Act) as determined by Freedom of 
Information (FOI) officials of the Department of Health and Human 
Services, data contained in the portions of this proposal which have 
been specifically identified by page number, paragraph, etc. by the 
offeror as containing restricted information shall not be used or 
disclosed except for evaluation purposes.
    The offeror acknowledges that the Department may not be able to 
withhold a record (data, document, etc.) nor deny access to a record 
requested pursuant to the Act and that the Department's FOI 
officials must make that determination. The offeror hereby agrees 
that the Government is not liable for disclosure if the Department 
has determined that disclosure is required by the Act.
    If a contract is awarded to the offeror as a result of, or in 
connection with, the submission of this proposal, the Government 
shall have the right to use or disclose the data to the extent 
provided in the contract. Proposals not resulting in a contract 
remain subject to the Act.
    The offeror also agrees that the Government is not liable for 
disclosure or use of unmarked data and may use or disclose the data 
for any purpose, including the release of the information pursuant 
to requests under the Act. The data subject to this restriction are 
contained in pages (insert page numbers, paragraph designations, 
etc. or other identification).''
    (2) In addition, the offeror must mark each page of data it 
wishes to restrict with the following statement:
    ``Use or disclosure of data contained on this page is subject to 
the restriction on the cover sheet of this proposal or quotation.''
    (3) Offerors are cautioned that proposals submitted with 
restrictive statements or statements differing in substance from 
those cited above may not be considered for award. The Government 
reserves the right to reject any proposal submitted with 
nonconforming statement(s).

0
101. Revise section 352.215-70 to read as follows:


Sec.  352.215-70  Late proposals and revisions.

    As prescribed in 315.208, the following provision may be included 
in the solicitation:

Late Proposals and Revisions (January 2006)

    Notwithstanding the procedures contained in FAR 52.215-1(c)(3) 
of the provision of this solicitation entitled Instructions to 
Offerors--Competitive Acquisition, a proposal received after the 
date specified for receipt may be considered if it appears to offer 
the best value to the Government and it was received before 
proposals were distributed for evaluation, or within five calendar 
days after the exact time specified for receipt, whichever is 
earlier.

(End of provision)



0
102. Amend section 352.216-72 by revising the title and paragraph 
(a)(4) of the ``Additional Cost Principles'' clause to read as follows:


Sec.  352.216-72  Additional cost principles.

* * * * *

Additional Cost Principles (January 2006)

    (a) * * *
    (4) Bid and proposal costs do not include independent research 
and development costs

[[Page 76507]]

covered by the following paragraph, or preaward costs covered by 
paragraph 36 of Attachment B to OMB Circular A-122.
* * * * *

0
103. Revise section 352.223-70 to read as follows:


352.223-70  Safety and health.

    The following clause shall be used as prescribed in 323.7002:

Safety and Health (January 2006)

    (a) To help ensure the protection of the life and health of all 
persons, and to help prevent damage to property, the Contractor 
shall comply with all Federal, State and local laws and regulations 
applicable to the work being performed under this contract. These 
laws are implemented and/or enforced by the Environmental Protection 
Agency, Occupational Safety and Health Administration and other 
agencies at the Federal, State and local levels (Federal, State and 
local regulatory/enforcement agencies).
    (1) In addition, the following regulations must be followed when 
developing and implementing health and safety operating procedures 
and practices for both personnel and facilities involving the use or 
handling of hazardous materials and the conduct of research, 
development, or test projects:
    (i) 29 CFR 1910.1030, Bloodborne pathogens; 29 CFR 1910.1450, 
Occupational exposure to hazardous chemicals in laboratories; and 
other applicable occupational health and safety standards issued by 
the Occupational Health and Safety Administration (OSHA) and 
included in 29 CFR Part 1910. These regulations are available at 
http://www.osha.gov/comp-links.html.
    (ii) Nuclear Regulatory Commission Standards and Regulations, 
pursuant to the Energy Reorganization Act of 1974 (42 U.S.C. 5801 et 
seq.). Copies may be obtained from the U.S. Nuclear Regulatory 
Commission, Washington, DC 20555-0001.
    (2) The following guidelines are recommended for use in 
developing and implementing health and safety operating procedures 
and practices for both personnel and facilities:
    (i) Biosafety in Microbiological and Biomedical Laboratories, 
CDC and NIH, HHS. This publication is available at http://bmbl.od.nih.gov/index.htm.
    (ii) Prudent Practices for Safety in Laboratories (1995), 
National Research Council, National Academy Press, 500 Fifth Street, 
NW., Lockbox 285, Washington, DC 20055 (ISBN 0-309-05229-7). This 
publication can be obtained by telephoning 800-624-8373. It also is 
available at http://www.nap.edu/catalog/4911.html.
    (b) Further, the Contractor shall take or cause to be taken 
additional safety measures as the Contracting Officer, in 
conjunction with the project or other appropriate officers, 
determines to be reasonably necessary. If compliance with these 
additional safety measures results in an increase or decrease in the 
cost or time required for performance of any part of work under this 
contract, an equitable adjustment will be made in accordance with 
the applicable ``Changes'' clause set forth in this contract.
    (c) The Contractor shall maintain an accurate record of, and 
promptly report to the Contracting Officer, all accidents or 
incidents resulting in the exposure of persons to toxic substances, 
hazardous materials or hazardous operations; the injury or death of 
any person; and/or damage to property incidental to work performed 
under the contract and all violations for which the Contractor has 
been cited by any Federal, State or local regulatory/enforcement 
agency. The report shall include a copy of the notice of violation 
and the findings of any inquiry or inspection, and an analysis 
addressing the impact these violations may have on the work 
remaining to be performed. The report shall also state the required 
action(s), if any, to be taken to correct any violation(s) noted by 
the Federal, State or local regulatory/enforcement agency and the 
time frame allowed by the agency to accomplish the necessary 
corrective action.
    (d) If the Contractor fails or refuses to comply with the 
Federal, State or local regulatory/enforcement agency's directive(s) 
regarding any violation(s) and prescribed corrective action(s), the 
Contracting Officer may issue an order stopping all or part of the 
work until satisfactory corrective action (as approved by the 
Federal, State or local regulatory/enforcement agencies) has been 
taken and documented to the Contracting Officer. No part of the time 
lost due to any stop work order shall be subject to a claim for 
extension of time or costs or damages by the Contractor.
    (e) The Contractor shall insert the substance of this clause in 
each subcontract involving toxic substances, hazardous materials, or 
hazardous operations. Compliance with the provisions of this clause 
by subcontractors will be the responsibility of the Contractor.

(End of clause)



0
104. Revise section 352.224-70 to read as follows:


352.224-70  Confidentiality of information.

    The following clause covers the policy set forth in subpart 324.70 
and is used in accordance with the instructions set forth in 324.7004.

Confidentiality of Information (January 2006)

    (a) Confidential information, as used in this clause, means 
information or data of a personal nature about an individual, or 
proprietary information or data submitted by or pertaining to an 
institution or organization.
    (b) The Contracting Officer and the Contractor may, by mutual 
consent, identify elsewhere in this contract specific information 
and/or categories of information which the Government will furnish 
to the Contractor or that the Contractor is expected to generate 
which is confidential. Similarly, the Contracting Officer and the 
Contractor may, by mutual consent, identify such confidential 
information from time to time during the performance of the 
contract. Failure to agree will be settled pursuant to the 
``Disputes'' clause.
    (c) If it is established elsewhere in this contract that 
information to be utilized under this contract, or a portion 
thereof, is subject to the Privacy Act, the Contractor will follow 
the rules and procedures of disclosure set forth in the Privacy Act 
of 1974, 5 U.S.C. 552a, and implementing regulations and policies, 
with respect to systems of records determined to be subject to the 
Privacy Act.
    (d) Confidential information, as defined in paragraph (a) of 
this clause, shall not be disclosed without the prior written 
consent of the individual, institution, or organization.
    (e) Whenever the Contractor is uncertain with regard to the 
proper handling of material under the contract, or if the material 
in question is subject to the Privacy Act or is confidential 
information subject to the provisions of this clause, the Contractor 
should obtain a written determination from the Contracting Officer 
prior to any release, disclosure, dissemination, or publication.
    (f) Contracting Officer determinations will reflect the result 
of internal coordination with appropriate program and legal 
officials.
    (g) The provisions of paragraph (d) of this clause shall not 
apply to conflicting or overlapping provisions in other Federal, 
State, or local laws.

(End of clause)



0
105. Amend section 352.228-7 by revising paragraph (d) of the 
``Insurance--Liability to Third Persons'' clause to read as follows:


352.228-7  Insurance--Liability to third persons.

* * * * *
    (d) The Government's liability under paragraph (c) of this 
clause is limited to the amounts reflected in final judgments, or 
settlements approved in writing by the Government, but in no event 
to exceed the funds available under the Limitation of Cost or 
Limitation of Funds clause of this contract. Nothing in this 
contract shall be construed as implying that, at a later date, the 
Government will request, or the Congress will appropriate, funds 
sufficient to meet any deficiencies.
* * * * *

0
106. Revise section 352.232-9 to read as follows:


352.232-9  Withholding of contract payments.

    Insert the following clause in all solicitations and contracts 
other than awards made using simplified acquisition procedures:

Withholding of Contract Payments (January 2006)

    Notwithstanding any other payment provisions of this contract, 
failure of the Contractor to submit required reports when due or 
failure to perform or deliver required work, supplies, or services, 
may result in the withholding of payments under this contract unless 
such failure arises out of causes beyond the control, and without 
the fault or negligence of the Contractor as defined by the clause 
entitled ``Excusable Delays'' or ``Default'', as applicable. The 
Government shall immediately notify the Contractor of its

[[Page 76508]]

intention to withhold payment of any invoice or voucher submitted.

(End of clause)


352.232-74  [Removed]

0
107. Remove section 352.232-74.

0
108. Revise section 352.232-75 to read as follows:


352.232-75  Incremental funding.

    The following provision shall be included in all requests for 
proposals whenever the use of incremental funding is contemplated:

Incremental Funding (January 2006)

    (a) It is the Government's intention to negotiate and award a 
contract using the incremental funding concepts described in the 
clause entitled Limitation of Funds, as specified in FAR 52.232-22. 
Under the clause, which will be included in the resultant contract, 
initial funds will be obligated under the contract to cover the 
first year of performance. The Government intends to allot 
additional funds up to and including the full estimated cost of the 
contract for the remaining years of performance by contract 
modification. However, the Government is not obligated to reimburse 
the Contractor for costs incurred in excess of the periodic 
allotments nor is the Contractor obligated to perform in excess of 
the amount allotted.
    (b) The Limitation of Funds clause to be included in the 
resultant contract, as specified in FAR 52.232-22, shall supersede 
the Limitation of Cost clause found in the Section I, Contract 
Clauses.

(End of provision)



0
109. Revise section 352.233-70 to read as follows:


352.233-70  Litigation and claims.

    Insert the following clause in all solicitations and resultant 
cost-reimbursement contracts:

Litigation and Claims (January 2006)

    The Contractor shall provide written notification immediately to 
the Contracting Officer of any action, including any proceeding 
before an administrative agency, filed against the Contractor 
arising out of the performance of this contract, including, but not 
limited to the performance of any subcontract hereunder; and any 
claim against the Contractor the cost and expense of which is 
allowable under the clause entitled ``Allowable Cost and Payment.'' 
Except as otherwise directed by the Contracting Officer, the 
Contractor shall furnish immediately to the Contracting Officer 
copies of all pertinent papers received by the Contractor with 
respect to such action or claim. To the extent not in conflict with 
any applicable policy of insurance, the Contractor may, with the 
Contracting Officer's approval, settle any such action or claim. If 
required by the Contracting Officer, the Contractor shall effect an 
assignment and subrogation in favor of the Government of all the 
Contractor's rights and claims (except those against the Government) 
arising out of any such action or claim against the Contractor; and 
authorize representatives of the Government to settle or defend any 
such action or claim and to represent the Contractor in, or to take 
charge of, any action. If the settlement or defense of an action or 
claim is undertaken by the Government, the Contractor shall furnish 
all reasonable assistance in effecting a settlement or asserting a 
defense. Where an action against the Contractor is not covered by a 
policy of insurance, the Contractor shall, with the approval of the 
Contracting Officer, proceed with the defense of the action in good 
faith. The Government shall not be liable for the expense of 
defending any action or for any costs resulting from the loss 
thereof to the extent that the Contractor would have been 
compensated by insurance which was required by law or regulation or 
by written direction of the Contracting Officer, but which the 
Contractor failed to secure through its own fault or negligence. In 
any event, unless otherwise expressly provided in this contract, the 
Contractor shall not be reimbursed or indemnified by the Government 
for any liability loss, cost or expense, which the Contractor may 
incur or be subject to by reason of any loss, injury or damage, to 
the person or to real or personal property of any third parties as 
may accrue during, or arise from, the performance of this contract.

(End of clause)



0
110. Revise section 352.249-14 to read as follows:


352.249-14  Excusable delays.

    Insert the following clause in all solicitations and resultant 
contracts, other than awards made using simplified acquisition 
procedures:

Excusable Delays (January 2006)

    (a) Except with respect to failures of subcontractors, the 
Contractor shall not be considered to have failed in performance of 
this contract if such failure arises out of causes beyond the 
control and without the fault or negligence of the Contractor.
    (b) Such causes may include, but are not restricted to, acts of 
God or of the public enemy, acts of the Government in either its 
sovereign or contractual capacity, fires, floods, epidemics, 
quarantine restrictions, strikes, freight embargoes, and unusually 
severe weather, but in every case the failure to perform must be 
beyond the control and without the fault or negligence of the 
Contractor. If the failure to perform is caused by the failure of a 
subcontractor to perform, and if such failure arises out of causes 
beyond the control of both the Contractor and subcontractor, and 
without the fault or negligence of either of them, the Contractor 
shall not be deemed to have failed in performance of the contract, 
unless: (1) The supplies or services to be furnished by the 
subcontractor were obtainable from other sources, (2) the 
Contracting Officer ordered the Contractor in writing to procure 
such supplies or services from such other sources, and (3) the 
Contractor failed to comply with such order. Upon request of the 
Contractor, the Contracting Officer shall ascertain the facts and 
extent of such failure and if the Contracting Officer determines 
that any failure to perform was caused by circumstances beyond the 
control and without the fault or negligence of the Contractor, the 
delivery schedule shall be revised accordingly, subject to the 
rights of the Government under the termination clause contained in 
this contract. (As used in this clause, the terms ``subcontractor'' 
and ``subcontractors'' mean subcontractor(s) at any tier.)

(End of clause)



0
111. Amend section 352.270-1 by revising the introductory text of the 
section and paragraph (c)(3) of the Accessibility clause to read as 
follows:


352.270-1  Accessibility of meetings, conferences, and seminars to 
persons with disabilities.

    Use the following clause in accordance with 370.102:

Accessibility of Meetings, Conferences, and Seminars to Persons With 
Disabilities (Jan 2001)

* * * * *
    (c) * * *
    (3) At a minimum, when requested in advance, the Contractor 
shall provide the following services:
    (i) For persons with hearing impairments, qualified 
interpreters. Also, the meeting rooms will be adequately illuminated 
so signing by interpreters can be easily seen.
    (ii) For persons with vision impairments, readers and/or 
cassette materials, as necessary, to enable full participation. 
Also, meeting rooms will be adequately illuminated.
    (iii) Agenda and other conference material(s) shall be 
translated into a usable form for persons with sensory impairments. 
Readers, Braille translations, large print text, and/or tape 
recordings are all acceptable. These materials shall be available to 
individuals with sensory impairments upon their arrival.

(End of clause)
* * * * *


0
112. Amend section 352.270-2 by revising the introductory text to read 
as follows:


352.270-2  Indian preference.

    Use the following clause as prescribed in 370.202(a):
* * * * *

0
113. Revise section 352.270-3 to read as follows:


352.270-3  Indian preference program.

    Use the following clause as prescribed in 370.202(b):

Indian Preference Program (January 2006)

    (a) In addition to the requirements of the clause of this 
contract entitled ``Indian Preference,'' the Contractor agrees to 
establish and conduct an Indian preference program which will expand 
opportunities for Indians to receive preference for employment

[[Page 76509]]

and training in connection with the work to be performed under this 
contract, and which will expand the opportunities for Indian 
organizations and Indian-owned economic enterprises to receive a 
preference in the awarding of subcontracts. In this connection, the 
Contractor shall:
    (1) Designate a liaison officer who will maintain liaison with 
the Government and the Tribe(s) on Indian preference matters; 
supervise compliance with the provisions of this clause; and 
administer the Contractor's Indian preference program.
    (2) Advise its recruitment sources in writing and include a 
statement in all advertisements for employment that Indian 
applicants will be given preference in employment and training 
incident to such employment.
    (3) Not more than twenty (20) calendar days after award of the 
contract, post a written notice in the Tribal office of any 
reservations on which or near where the work under this contract is 
to be performed that sets forth the Contractor's employment needs 
and related training opportunities. The notice shall include the 
approximate numbers and types of employees needed; the approximate 
dates of employment; the experience or special skills required for 
employment, if any; training opportunities available; and other 
pertinent information necessary to advise prospective employees of 
any other employment requirements. The Contractor shall also request 
the Tribe(s) on or near whose reservation(s) the work is to be 
performed to provide assistance to the Contractor in filling its 
employment needs and training opportunities. The Contracting Officer 
will advise the Contractor of the name, location, and phone number 
of the Tribal officials to contact in regard to the posting of 
notices and requests for Tribal assistance.
    (4) Establish and conduct a subcontracting program which gives 
preference to Indian organizations and Indian-owned economic 
enterprises as subcontractors and suppliers under this contract. The 
Contractor shall give public notice of existing subcontracting 
opportunities and, to the extent feasible and consistent with the 
efficient performance of this contract, shall solicit bids or 
proposals only from Indian organizations or Indian-owned economic 
enterprises. The Contractor shall request assistance and information 
on Indian firms qualified as suppliers or subcontractors from the 
Tribe(s) on or near whose reservation(s) the work under the contract 
is to be performed. The Contracting Officer will advise the 
Contractor of the name, location, and phone number of the Tribal 
officials to be contacted in regard to the request for assistance 
and information. Public notices and solicitations for existing 
subcontracting opportunities shall provide an equitable opportunity 
for Indian firms to submit bids or proposals by including: (i) A 
clear description of the supplies or services required, including 
quantities, specifications, and delivery schedules which facilitate 
the participation of Indian firms; (ii) A statement indicating that 
preference will be given to Indian organizations and Indian-owned 
economic enterprises in accordance with section 7(b) of Public Law 
93-638 (88 Stat. 2205; 25 U.S.C. 450e(b)); (iii) Definitions for the 
terms ``Indian organization'' and ``Indian-owned economic 
enterprise'' as prescribed under the ``Indian Preference'' clause of 
this contract; (iv) A statement to be completed by the bidder or 
offeror that it is an Indian organization or Indian-owned economic 
enterprise; and (v) A closing date for receipt of bids or proposals 
which provides sufficient time for preparation and submission of a 
bid or proposal. If after soliciting bids or proposals from Indian 
organizations and Indian-owned economic enterprises, no responsive 
bid or acceptable proposal is received, the Contractor shall comply 
with the requirements of paragraph (d) of the ``Indian Preference'' 
clause of this contract. If one or more responsible bids or 
acceptable proposals are received, award shall be made to the low 
responsible bidder or acceptable offeror if the price is determined 
to be reasonable. If the low responsive bid or acceptable proposal 
is determined to be unreasonable as to price, the Contractor shall 
attempt to negotiate a reasonable price and award a subcontract. If 
a reasonable price cannot be agreed upon, the Contractor shall 
comply with the requirements of paragraph (d) of the ``Indian 
Preference'' clause of this contract.
    (5) Maintain written records under this contract which indicate: 
(i) The numbers of Indians seeking employment for each employment 
position available under this contract; (ii) The number and types of 
positions filled by Indians and non-Indians; (iii) The total number 
of Indians employed under this contract; (iv) For those positions 
where there are both Indian and non-Indian applicants, and a non-
Indian is selected for employment, the reason(s) why the Indian 
applicant was not selected; (v) Actions taken to give preference to 
Indian organizations and Indian-owned economic enterprises for 
subcontracting opportunities which exist under this contract; (vi) 
Reasons why preference was not given to Indian firms as 
subcontractors or suppliers for each requirement where it was 
determined by the Contractor that such preference would not be 
consistent with the efficient performance of the contract; and (vii) 
The number of Indian organizations and Indian-owned economic 
enterprises contacted, and the number receiving subcontract awards 
under this contract.
    (6) Submit to the Contracting Officer for approval a quarterly 
report which summarizes the Contractor's Indian preference program 
and indicates the number and types of available positions filled by 
Indians and non-Indians, and the dollar amounts of all subcontracts 
awarded to Indian organizations and Indian-owned economic 
enterprises, and to all other firms.
    (7) Maintain records pursuant to this clause and keep them 
available for review by the Government for one year after final 
payment under this contract, or for such longer period as may be 
required by any other clause of this contract or by applicable law 
or regulation.
    (b) For purposes of this clause, the following definitions of 
terms shall apply:
    (1) The terms ``Indian,'' ``Indian Tribe,'' ``Indian 
Organization,'' and ``Indian-owned economic enterprise'' are defined 
in the clause of this contract entitled ``Indian Preference.''
    (2) ``Indian reservation'' includes Indian reservations, public 
domain Indian Allotments, former Indian reservations in Oklahoma, 
and land held by incorporated Native groups, regional corporations, 
and village corporations under the provisions of the Alaska Native 
Claims Settlement Act (85 Stat. 688; 43 U.S.C. 1601 et seq.)
    (3) ``On or near an Indian Reservation'' means on a reservation 
or reservations or within that area surrounding an Indian 
reservation(s) where a person seeking employment could reasonably be 
expected to commute to and from in the course of a work day.
    (c) Nothing in the requirements of this clause shall be 
interpreted to preclude Indian Tribes from independently developing 
and enforcing their own Indian preference requirements. Such 
requirements must not conflict with any Federal statutory or 
regulatory requirement dealing with the award and administration of 
contracts.
    (d) The Contractor agrees to include the provisions of this 
clause, including this paragraph (d), in each subcontract awarded at 
any tier under this contract and to notify the Contracting Officer 
of such subcontracts.
    (e) In the event of noncompliance with this clause, the 
Contracting Officer may terminate the contract in whole or in part 
or may impose any other sanctions authorized by law or by other 
provisions of the contract.

(End of clause)



0
114. Amend section 352.270-4 by revising the introductory text to read 
as follows and by replacing the word ``permforming'' in the table with 
``performing:''


352.270-4  Pricing of adjustments.

    Insert the following clause in all solicitations and resultant 
fixed-priced contracts other than awards made using simplified 
acquisition procedures.
* * * * *

0
115. Revise section 352.270-5 to read as follows:


352.270-5  Key personnel.

    Insert the following clause in all solicitations and resultant 
contracts which require Key Personnel, regardless of the type of 
contract.

Key Personnel (January 2006)

    The key personnel specified in this contract are considered to 
be essential to work performance. At least 30 days prior to 
diverting any of the specified individuals to other programs or 
contracts (or as soon as possible, if an individual must be 
replaced, for example, as a result of leaving the employ of the 
Contractor), the Contractor shall notify the Contracting Officer and 
shall submit comprehensive justification for the diversion or 
replacement request (including proposed substitutions for key 
personnel) to permit evaluation by the Government of the impact on 
performance under this contract. The

[[Page 76510]]

Contractor shall not divert or otherwise replace any key personnel 
without the written consent of the Contracting Officer. The 
Government may modify the contract to add or delete key personnel at 
the request of the contractor or Government.

(End of clause)



0
116. Revise section 352.270-6 to read as follows:


352.270-6  Publications and publicity.

    Insert the following clause in all solicitations and resultant 
contracts.

Publications and Publicity (January 2006)

    (a) Unless otherwise specified in this contract and the 
Confidentiality of Information clause is included, the Contractor is 
encouraged to publish the results of its work under this contract. A 
copy of each article submitted by the Contractor for publication 
shall be promptly sent to the Project Officer. The Contractor shall 
also inform the Project Officer when the article or other 
publication is published, and furnish a copy of it as finally 
published.
    (b) The Contractor shall include in any publication resulting 
from work performed under this contract a disclaimer reading as 
follows:
    ``The views expressed in written conference materials or 
publications and by speakers and moderators at HHS-sponsored 
conferences, do not necessarily reflect the official policies of the 
Department of Health and Human Services; nor does mention of trade 
names, commercial practices, or organizations imply endorsement by 
the U.S. Government.''
    (c) Unless authorized by the Project Officer, the contractor 
shall not display the HHS logo on any conference materials or 
publications.

(End of clause)



0
117. Revise section 352.270-7 to read as follows:


352.270-7  Paperwork Reduction Act.

    Insert the following clause in all solicitations and contracts 
subject to the Paperwork Reduction Act requirements regarding the 
collection and recording of information from 10 or more persons other 
than Federal employees.

Paperwork Reduction Act (January 2006)

    (a) This contract involves a requirement to collect or record 
information calling either for answers to identical questions from 
10 or more persons other than Federal employees, or information from 
Federal employees which is outside the scope of their employment, 
for use by the Federal government or disclosure to third parties; 
therefore, the Paperwork Reduction Act of 1995 (Pub. L. 104-13) 
shall apply to this contract. No plan, questionnaire, interview 
guide or other similar device for collecting information (whether 
repetitive or single-time) may be used without first obtaining 
clearance from the Office of Management and Budget (OMB). 
Contractors and Project Officers should be guided by the provisions 
of 5 CFR part 1320, Controlling Paperwork Burdens on the Public, and 
seek the advice of the HHS operating division or Office of the 
Secretary Reports Clearance Officer to determine the procedures for 
acquiring OMB clearance.
    (b) The Contractor shall not expend any funds or begin any data 
collection until OMB Clearance is received. Once OMB Clearance is 
received from the Project Officer, the Contracting Officer shall 
provide the Contractor with written notification authorizing the 
expenditure of funds and the collection of data. The Contractor must 
allow at least 120 days for OMB clearance. Excessive delays caused 
by the Government which arise out of causes beyond the control and 
without the fault or negligence of the Contractor will be considered 
in accordance with the Excusable Delays or Default clause of this 
contract.

(End of clause)



0
118. Revise section 352.270-8 to read as follows:


352.270-8  Protection of human subjects.

    (a) Include the following provision in solicitations expected to 
involve human subjects:

Notice to Offerors of Requirements of 45 CFR Part 46, Protection of 
Human Subjects (January 2006)

    (a) Copies of the Department of Health and Human Services (HHS) 
regulations for the protection of human subjects, 45 CFR part 46, 
are available from the Office for Human Research Protections (OHRP), 
Bethesda, Maryland 20892. The regulations provide a systematic 
means, based on established ethical principles, to safeguard the 
rights and welfare of individuals who participate as subjects in 
research activities supported or conducted by HHS.
    (b) The regulations define a human subject as a living 
individual about whom an investigator (whether professional or 
student) conducting research obtains data through intervention or 
interaction with the individual, or identifiable private 
information. The regulations extend to the use of human organs, 
tissue, and body fluids from individually identifiable human 
subjects as well as to graphic, written, or recorded information 
derived from individually identifiable human subjects. The use of 
autopsy materials is governed by applicable State and local law and 
is not directly regulated by 45 CFR part 46.
    (c) Activities in which the only involvement of human subjects 
will be in one or more of the categories set forth in 45 CFR 
46.101(b)(1-6) are exempt from coverage.
    (d) Inappropriate designations of the noninvolvement of human 
subjects or of exempt categories of research in a project may result 
in delays in the review of a proposal. The OPDIV will make a final 
determination of whether the proposed activities are covered by the 
regulations or are in an exempt category, based on the information 
provided in the proposal. In doubtful cases, prior consultation with 
OHRP, (telephone: 301-496-7014), is recommended.
    (e) In accordance with 45 CFR part 46, prospective Contractors 
being considered for award shall be required to file with OHRP an 
acceptable Assurance of Compliance with the regulations, specifying 
review procedures and assigning responsibilities for the protection 
of human subjects. The initial and continuing review of a research 
project by an institutional review board shall assure that the 
rights and welfare of the human subjects involved are adequately 
protected, that the risks to the subjects are reasonable in relation 
to the potential benefits, if any, to the subjects and the 
importance of the knowledge to be gained, and that informed consent 
will be obtained by methods that are adequate and appropriate. HHS 
regulations for the protection of human subjects (45 CFR part 46), 
information regarding OHRP registration and assurance requirements/
processes, and OHRP contact information can be accessed at the OHRP 
Web site: http://www.hhs.gov/ohrp/.
    (f) It is recommended that OHRP be consulted for advice or 
guidance concerning either regulatory requirements or ethical issues 
pertaining to research involving human subjects.

(End of provision)

    (b) Include the following clause in solicitations and resultant 
contracts involving human subjects:

Protection of Human Subjects (January 2006)

    (a) The Contractor agrees that the rights and welfare of human 
subjects involved in research under this contract shall be protected 
in accordance with 45 CFR part 46 and with the Contractor's current 
Assurance of Compliance on file with the Office for Human Research 
Protections (OHRP), Office of Public Health and Science (OPHS). The 
Contractor further agrees to provide certification at least annually 
that the Institutional Review Board has reviewed and approved the 
procedures, which involve human subjects in accordance with 45 CFR 
part 46 and the Assurance of Compliance.
    (b) The Contractor shall bear full responsibility for the 
performance of all work and services involving the use of human 
subjects under this contract and shall ensure that work is conducted 
in a proper manner and as safely as is feasible. The parties hereto 
agree that the Contractor retains the right to control and direct 
the performance of all work under this contract. Nothing in this 
contract shall be deemed to constitute the Contractor or any 
subcontractor, agent or employee of the Contractor, or any other 
person, organization, institution, or group of any kind whatsoever, 
as the agent or employee of the Government. The Contractor agrees 
that it has entered into this contract and will discharge its 
obligations, duties, and undertakings and the work pursuant thereto, 
whether requiring professional judgment or otherwise, as an 
independent contractor without imputing liability on the part of the 
Government for the acts of the Contractor or its employees.
    (c) If at any time during the performance of this contract, the 
Contracting Officer determines, in consultation with the OHRP, OPHS, 
ASH, that the Contractor is not in compliance with any of the 
requirements

[[Page 76511]]

and/or standards stated in paragraphs (a) and (b) above, the 
Contracting Officer may immediately suspend, in whole or in part, 
work and further payments under this contract until the Contractor 
corrects the noncompliance. Notice of the suspension may be 
communicated by telephone and confirmed in writing. If the 
Contractor fails to complete corrective action within the period of 
time designated in the Contracting Officer's written notice of 
suspension, the Contracting Officer may, in consultation with OHRP, 
OPHS, ASH, terminate this contract in a whole or in part, and the 
Contractor's name may be removed form the list of those contractors 
with approved Health and Human Services Human Subject Assurances.

(End of clause)



0
119. Revise section 352.270-9 to read as follows:


352.270-9  Care of laboratory animals.

    (a) Include the following provision in solicitations expected to 
involve vertebrate animals:

Notice to Offerors of Requirement for Compliance With the Public Health 
Service Policy on Humane Care and Use of Laboratory Animals (January 
2006)

    The PHS Policy on Humane Care and Use of Laboratory Animals by 
Awardee Institutions establishes a number of requirements for 
research activities involving animals. Before award may be made to 
an applicant organization, the organization shall file, with the 
Office of Laboratory Animal Welfare (OLAW), National Institutes of 
Health (NIH), a written Animal Welfare Assurance which commits the 
organization to comply with the provisions of the PHS Policy on 
Humane Care and Use of Laboratory Animals by Awardee Institutions, 
the Animal Welfare Act, and the Guide for the Care and Use of 
Laboratory Animals prepared by the Institute of Laboratory Animal 
Resources. In accordance with the PHS Policy on Humane Care and Use 
of Laboratory Animals by Awardee Institutions, applicant 
organizations must establish a committee, qualified through the 
experience and expertise of its members, to oversee the 
institution's animal program, facilities and procedures. No award 
involving the use of animals shall be made unless OLAW approves the 
Animal Welfare Assurance. Prior to award, the Contracting Officer 
will notify Contractor(s) selected for projects that involve live 
vertebrate animals that an Animal Welfare Assurance is required. The 
Contracting Officer will request that OLAW negotiate an acceptable 
Animal Welfare Assurance with those Contractor(s). For further 
information, contact OLAW at NIH, Bethesda, Maryland 20892 (301-496-
7163).

(End of provision)

    (b) Include the following clause in all solicitations and resultant 
contracts involving research on vertebrate animals:

Care of Live Vertebrate Animals (January 2006)

    (a) Before undertaking performance of any contract involving 
animal related activities, the Contractor shall register with the 
Secretary of Agriculture of the United States in accordance with 7 
U.S.C. 2136 and 9 CFR 2.25 through 2.28. The Contractor shall 
furnish evidence of the registration to the Contracting Officer.
    (b) The Contractor shall acquire vertebrate animals used in 
research from a dealer licensed by the Secretary of Agriculture 
under 7 U.S.C. 2133 and 9 CFR 2.1 through 2.11, or from a source 
that is exempt from licensing under those sections.
    (c) The Contractor agrees that the care and use of any live 
vertebrate animals used or intended for use in the performance of 
this contract will conform with the PHS Policy on Humane Care of Use 
of Laboratory Animals, the current Animal Welfare Assurance, the 
Guide for the Care and Use of Laboratory Animals prepared by the 
Institute of Laboratory Animal Resources and the pertinent laws and 
regulations of the United States Department of Agriculture (see 7 
U.S.C. 2131 et seq. and 9 CFR Subchapter A, Parts 1-4). In case of 
conflict between standards, the more stringent standard shall be 
used.
    (d) If at any time during performance of this contract, the 
Contracting Officer determines, in consultation with the Office of 
Laboratory Animal Welfare (OLAW), National Institutes of Health 
(NIH), that the Contractor is not in compliance with any of the 
requirements and/or standards stated in paragraphs (a) through (c) 
above, the Contracting Officer may immediately suspend, in whole or 
in part, work and further payments under this contract until the 
Contractor corrects the noncompliance. Notice of the suspension may 
be communicated by telephone and confirmed in writing. If the 
Contractor fails to complete corrective action within the period of 
time designated in the Contracting Officer's written notice of 
suspension, the Contracting Officer may, in consultation with OLAW, 
NIH, terminate this contract in whole or in part, and the 
Contractor's name may be removed from the list of those contractors 
with approved PHS Animal Welfare Assurances.

    Note: The Contractor may request registration of its facility 
and a current listing of licensed dealers from the Regional Office 
of the Animal and Plant Health Inspection Service (APHIS), USDA, for 
the region in which its research facility is located. The location 
of the appropriate APHIS Regional Office, as well as information 
concerning this program may be obtained by contacting the Animal 
Care Staff, USDA/APHIS, 4700 River Road, Riverdale, Maryland 20737.


(End of clause)


0
120. Add sections 352.270-10 through 352.270-19 to subpart 352.2 to 
read as follows:

Subpart 352.2--Texts of Provisions and Clauses

* * * * *
352.270-10 Anti-lobbying.
352.270-11 Privacy Act.
352.270-12 Pro-Children Act.
352.270-13 Tobacco-free facilities.
352.270-14 Restriction on use of human subjects.
352.270-15 Salary rate limitation.
352.270-16 Native American Graves Protection and Repatriation Act.
352.270-17 Crime Control Act--Reporting of child abuse.
352.270-18 Crime Control Act--Requirement for background checks.
352.270-19 Electronic information and technology accessibility.

Subpart 352.2--Texts of Provisions and Clauses

* * * * *


352.270-10  Anti-lobbying.

    Insert the following clause in all solicitations and resultant 
contracts expected to exceed $100,000:

Anti-Lobbying (January 2006)

    Pursuant to the current HHS annual appropriations act, except 
for normal and recognized executive-legislative relationships, the 
Contractor shall not use any HHS contract funds for (i) publicity or 
propaganda purposes; (ii) the preparation, distribution, or use of 
any kit, pamphlet, booklet, publication, radio, television or video 
presentation designed to support or defeat legislation pending 
before the Congress or any State legislature, except in presentation 
to the Congress or any State legislature itself; or (iii) payment of 
salary or expenses of the Contractor, or any agent acting for the 
Contractor, related to any activity designed to influence 
legislation or appropriations pending before the Congress or any 
State legislature.

(End of Clause)

352.270-11  Privacy Act.

    The following clause shall be used as prescribed in 324.103(a):

Privacy Act (January 2006)

    This contract requires the Contractor to perform one or more of 
the following: (a) Design; (b) develop; or (c) operate a Federal 
agency system of records to accomplish an agency function in 
accordance with the Privacy Act of 1974 (Act) (5 U.S.C. 552a(m)(1)) 
and applicable agency regulations. The term ``system of records'' 
means a group of any records under the control of any agency from 
which information is retrieved by the name of the individual or by 
some identifying number, symbol, or other identifying particular 
assigned to the individual.
    Violations of the Act by the Contractor and/or its employees may 
result in the imposition of criminal penalties (5 U.S.C. 552a(i)). 
The Contractor shall ensure that each of its employees knows the 
prescribed rules of conduct and that each employee is aware that he/
she is subject to criminal penalties for violation of the Act to the 
same extent as HHS employees. These provisions also apply to all 
subcontracts awarded under this contract which require the design,

[[Page 76512]]

development or operation of the designated system(s) of records (5 
U.S.C. 552a(m)(1)).
    The contract work statement: (a) identifies the system(s) of 
records and the design, development, or operation work to be 
performed by the Contractor; and (b) specifies the disposition to be 
made of such records upon completion of contract performance.

(End of clause)

352.270-12  Pro-Children Act.

    Insert the following clause in all solicitations and resultant 
contracts and orders, regardless of dollar amount, for (i) 
kindergarten, elementary, or secondary education or library services or 
(ii) health or day care services that are provided to children under 
the age of 18 on a routine or regular basis pursuant to the Pro-
Children Act of 1994:

Pro-Children Act of 1994 (January 2006)

    Public Law 103-227, Title X, Part C, also known as the Pro-
Children Act of 1994 (Act), 20 U.S.C. 7183, imposes restrictions on 
smoking in facilities where certain federally funded children's 
services are provided. The Act prohibits smoking within any indoor 
facility (or portion thereof), whether owned, leased, or contracted 
for, that is used for the routine or regular provision of (i) 
kindergarten, elementary, or secondary education or library services 
or (ii) health or day care services that are provided to children 
under the age of 18. The statutory prohibition also applies to 
indoor facilities that are constructed, operated, or maintained with 
Federal funds.
    By acceptance of this contract or order, the Contractor agrees 
to comply with the requirements of the Act. The Act also applies to 
all subcontracts awarded under this contract for the specified 
children's services. Accordingly, the Contractor shall ensure that 
each of its employees, and any subcontractor staff, is made aware 
of, understand, and comply with the provisions of the Act.
    Failure to comply with the Act may result in the imposition of a 
civil monetary penalty in an amount not to exceed $1,000 for each 
violation and/or the imposition of an administrative compliance 
order on the responsible entity. Each day a violation continues 
constitutes a separate violation.

(End of clause)

352.270-13  Tobacco-free facilities.

    Insert the following clause in all new solicitations and resultant 
contracts and orders (including construction) and all modifications 
resulting from the exercise of an option under a contract or order, 
regardless of dollar value, where some or all of the Contractor's 
performance, will take place on HHS properties. This clause is not 
required to be included if contract or order performance requires only 
that Contractor staff attend occasional meetings on HHS properties. In 
this case, Contractor employees are considered ``visitors.'' Further, 
for any proposed or existing construction contract or order, the 
Contracting Officer should coordinate any exceptions to the policy 
raised by an incumbent or potential Contractor based on union or 
collective bargaining agreements with the designated OPDIV tobacco-free 
policy contact point for final disposition.

Tobacco-Free Facilities (January 2006)

    In accordance with Department of Health and Human Services (HHS) 
policy, the Contractor and its staff are prohibited from using 
tobacco products of any kind (e.g., cigarettes, cigars, pipes, and 
smokeless tobacco) while on any HHS property, including use in 
personal or company vehicles operated by Contractor employees while 
on an HHS property. This policy also applies to all subcontracts 
awarded under the contract or order.
    The term ``HHS properties'' includes all properties owned, 
controlled and/or leased by HHS when totally occupied by HHS, 
including all indoor and outdoor areas of such properties. Where HHS 
only partially occupies such properties, it includes all HHS-
occupied interior space. Where HHS leases space in a multi-occupant 
building or complex, the tobacco-free HHS policy will apply to the 
maximum area permitted by law and compliance with the provisions of 
any current lease agreements.
    The Contractor shall ensure that each of its employees, and any 
subcontractor staff, is made aware of, understand, and comply with 
this policy.

(End of clause)

352.270-14  Restriction on use of human subjects.

    If the Contractor has an approved Federal-wide assurance of 
compliance in place, but the certification that the Institutional 
Review Board (IRB) designated under the assurance has reviewed and 
approved the research cannot be completed prior to contract award 
because definite plans for involvement of human subjects are not set 
forth in the proposal (e.g., projects in which human subjects' 
involvement will depend upon completion of instruments, prior animal 
studies, or purification of compounds), the award may be made without 
the requisite certification as long as the contract is appropriately 
conditioned. Under these conditions, insert the following clause in 
applicable contracts:

Restriction on Use of Human Subjects (January 2006)

    Pursuant to 45 CFR part 46, Protection of Human Research 
Subjects, the Contractor shall not expend funds under this award for 
research involving human subjects or engage in any human subjects 
research activity prior to the receipt by the Contracting Officer of 
a certification that the research has been reviewed and approved by 
the Institutional Review Board (IRB) designated under the 
Contractor's Federal-wide assurance of compliance. This restriction 
applies to all collaborating sites, whether domestic or foreign, and 
subcontractors. The Contractor must ensure compliance by 
collaborators and subcontractors.

(End of clause)

352.270-15  Salary rate limitation.

    Insert the following clause in all new NIH, SAMHSA, and AHRQ 
solicitations and resultant contracts and orders (except fixed-price 
completion contracts) and modifications of existing contracts for 
projects that support extramural activities. Projects that support 
extramural activities include extramural R&D, SAMHSA's mission-related 
requirements, and those activities commonly referred to as ``extramural 
R&D support.''

OR

    Insert the following clause in all new NIH, SAMHSA, and AHRQ 
solicitations and resultant contracts (except fixed-price completion 
contracts) and modifications of existing contracts for extramural R&D 
and SAMHSA's mission-related requirements. Projects that are not 
considered R&D but that support extramural R&D activities (commonly 
referred to as ``extramural R&D support'') are OR are not included.

Salary Rate Limitation (January 2006)

    Pursuant to the applicable HHS appropriations acts cited in the 
table below, the Contractor shall not use contract funds to pay the 
direct salary of an individual at a rate in excess of the salary 
level in effect on the date the expense is incurred as shown in the 
table below.
    For purposes of the salary limitation, the terms ``direct 
salary,'' ``salary,'' and ``institutional base salary'' have the 
same meaning and are collectively referred to as ``direct salary'' 
in this clause. An individual's direct salary is the annual 
compensation that the Contractor pays for an individual's 
appointment whether that individual's time is spent on research, 
teaching, patient care, or other activities. Direct salary excludes 
any income that an individual may be permitted to earn outside of 
duties to the Contractor. Direct salary also excludes fringe 
benefits, overhead, and general and administrative expenses (also 
referred to as indirect costs or facilities and administrative [F&A] 
costs).
    The salary rate limitation also applies to individuals 
performing under subcontracts. However, it does not apply to fees 
paid to consultants. If this is a multiple-year contract, it may be 
subject to unilateral modification by the Contracting Officer to 
ensure that an individual is not paid at a rate that exceeds the 
salary rate limitation provision established in the HHS 
appropriations act in effect when the expense is incurred regardless 
of the rate initially used to establish contract funding.

[[Page 76513]]



------------------------------------------------------------------------
                                                                Salary
                                                              limitation
             Public law                  Period covered       (based on
                                                              Executive
                                                               Level I)
------------------------------------------------------------------------
108-447, Div F, Title II, General    10/01/05--12/31/05....     $180,100
 Provisions, Section 204.
109-149, General Provisions,         01/01/06--until            $183,500
 Section 204.                         revised.
------------------------------------------------------------------------

    Executive Level salaries for the current and prior periods can 
be found at the following Web site: http://www.opm.gov/oca/05tables/html/ex.asp. Click on ``Salaries and Wages'' and then scroll to the 
bottom of the page to select the desired period.

(End of Clause)

352.270-16  Native American Graves Protection and Repatriation Act.

    Insert the following clause in any solicitation and resultant 
contract or order that requires performance on tribal lands and all 
solicitations and resultant contracts or orders for construction on 
Federal or tribal lands, regardless of dollar amount:

Native American Graves Protection and Repatriation Act (January 2006)

    Public Law 101-601, dated November 16, 1990, also known as the 
Native American Graves Protection and Repatriation Act (Act), 
imposes certain responsibilities on individuals and organizations 
when they discover Native American cultural items (including human 
remains) on Federal or tribal lands.
    In the event the Contractor discovers Native American cultural 
items (including human remains, associated funerary objects, 
unassociated funerary objects, sacred objects and cultural 
patrimony), as defined in the Act during contract performance, the 
Contractor shall: (i) Immediately cease activity in the area of the 
discovery; (ii) notify the Contracting Officer of the discovery; and 
(iii) make a reasonable effort to protect the items discovered 
before resuming such activity. Upon receipt of the Contractor's 
discovery notice, the Contracting Officer will notify the 
appropriate authorities as required by the Act.
    Unless otherwise specified by the Contracting Officer, the 
Contractor may resume activity in the area on the 31st calendar day 
following the date that the appropriate authorities certify receipt 
of the discovery notice. The date that the appropriate authorities 
certify receipt of the discovery notice and the date on which the 
Contractor may resume activities shall be provided to the Contractor 
by the Contracting Officer.

(End of clause)

352.270-17  Crime Control Act--Reporting of child abuse.

    Insert the following clause in all solicitations and resultant 
contracts and orders, regardless of dollar amount, where performance 
will take place on Federal land or in a federally-operated (or 
contracted) facility and that involve the professions/activities 
performed by persons specified in the Crime Control Act of 1990, 
including, but not limited to, physicians, nurses, dentists, health 
care practitioners, optometrists, psychologists, emergency medical 
technicians, alcohol or drug treatment personnel, child care workers 
and administrators, emergency medical technicians and ambulance 
drivers:

Crime Control Act of 1990--Reporting of Child Abuse (January 2006)

    Public Law 101-647, also known as the Crime Control Act of 1990 
(Act), imposes responsibilities on certain individuals who, while 
engaged in a professional capacity or activity, as defined in the 
Act, on Federal land or in a federally-operated (or contracted) 
facility, learn of facts that give the individual reason to suspect 
that a child has suffered an incident of child abuse.
    The Act designates ``covered professionals'' as those persons 
engaged in professions and activities in eight different categories 
including, but not limited to, physicians, dentists, medical 
residents or interns, hospital personnel and administrators, nurses, 
health care practitioners, chiropractors, osteopaths, pharmacists, 
optometrists, podiatrists, emergency medical technicians, ambulance 
drivers, alcohol or drug treatment personnel, psychologists, 
psychiatrists, mental health professionals, child care workers and 
administrators, and commercial film and photo processors. The Act 
defines the term ``child abuse'' as the physical or mental injury, 
sexual abuse or exploitation, or negligent treatment of a child.
    Accordingly, any person engaged in a covered profession or 
activity under an HHS contract or subcontract, regardless of the 
purpose of the contract or subcontract, shall immediately report a 
suspected child abuse incident in accordance with the provisions of 
the Act. If a child is suspected of being harmed, the appropriate 
State Child Abuse Hotline, local child protective services (CPS), or 
law enforcement agency should be contacted. For more information 
about where and how to file a report, the Childhelp USA[supreg], 
National Child Abuse Hotline (1-800-4-A-CHILD[supreg]) should be 
called. Any covered professional failing to make a timely report of 
such incident shall be guilty of a Class B misdemeanor.
    By acceptance of this contract or order, the Contractor agrees 
to comply with the requirements of the Act. The Act also applies to 
all applicable subcontracts awarded under this contract. 
Accordingly, the Contractor shall ensure that each of its employees, 
and any subcontractor staff, is made aware of, understand, and 
comply with the provisions of the Act.

(End of clause)

352.270-18  Crime Control Act--Requirement for background checks.

    Insert the following clause in all solicitations and resultant 
contracts and orders, regardless of dollar amount, for all child care 
services to children under the age of 18, including social services, 
health and mental health care, child (day) care, education (whether or 
not directly involved in teaching), and rehabilitative programs covered 
under the Crime Control Act of 1990 (Act):

Crime Control Act of 1990--Requirement for Background Checks (January 
2006)

    Public Law 101-647, also known as the Crime Control Act of 1990 
(Act), requires that all individuals involved with the provision of 
child care services to children under the age of 18 undergo a 
criminal background check. ``Child care services'' include, but are 
not limited to, social services, health and mental health care, 
child (day) care, education (whether or not directly involved in 
teaching), and rehabilitative programs. Any conviction for a sex 
crime, an offense involving a child victim, or a drug felony, may be 
grounds for denying employment or for dismissal of an employee 
providing any of the services listed above.
    The Contracting Officer will provide the necessary information 
to the Contractor regarding the process for obtaining the background 
check. The Contractor may hire a staff person provisionally prior to 
the completion of a background check, if at all times prior to the 
receipt of the background check during which children are in the 
care of the newly-hired person, the person is within the sight and 
under the supervision of a previously investigated staff person.
    By acceptance of this contract or order, the Contractor agrees 
to comply with the requirements of the Act. The Act also applies to 
all applicable subcontracts awarded under this contract. 
Accordingly, the Contractor shall ensure that each of its employees, 
and any subcontractor staff, is made aware of, understand, and 
comply with the provisions of the Act.

(End of clause)

352.270-19  Electronic information and technology accessibility.

    (a) The following clause shall be used in solicitations as provided 
in 339.201-70:

[[Page 76514]]

Electronic and Information Technology Accessibility (January 2006)

    Section 508 of the Rehabilitation Act of 1973 (29 U.S.C. 794d), 
as amended by Public Law 105-220 under Title IV (Rehabilitation Act 
Amendments of 1998) and the Architectural and Transportation 
Barriers Compliance Board Electronic and Information (EIT) 
Accessibility Standards (36 CFR part 1194), require that all EIT 
acquired must ensure that:
    (1) Federal employees with disabilities have access to and use 
of information and data that is comparable to the access and use by 
Federal employees who are not individuals with disabilities; and
    (2) Members of the public with disabilities seeking information 
or services from an agency have access to and use of information and 
data that is comparable to the access to and use of information and 
data by members of the public who are not individuals with 
disabilities.
    This requirement includes the development, procurement, 
maintenance, and/or use of EIT products/services; therefore, any 
proposal submitted in response to this solicitation must demonstrate 
compliance with the established EIT Accessibility Standards. 
Information about Section 508 is available at http://www.section508.gov/.

(End of provision)

    (b) The following clause shall be used in contracts and orders as 
provided in 339.201-70:

Electronic and Information Technology Accessibility (January 2006)

    Pursuant to Section 508 of the Rehabilitation Act of 1973 (29 
U.S.C. 794d) as amended by Public Law 105-220 under Title IV 
(Rehabilitation Act Amendments of 1998), all Electronic and 
Information Technology (EIT) developed, procured, maintained, and/or 
used under this contract shall be in compliance with the 
``Electronic and Information Technology Accessibility Standards'' 
set forth by the Architectural and Transportation Barriers 
Compliance Board (also referred to as the ``Access Board'') in 36 
CFR part 1194. The complete text of Section 508 Final Standards can 
be accessed at http://www.access-board.gov/sec508/standards.htm.
    The standards applicable to this requirement are [identified in 
the Statement of Work/listed below]:

(Select the appropriate phrase within the brackets [ ] and complete 
if necessary and identify location of/provide complete list of 
applicable provisions. Use the Buy accessible wizard at http://www.buyaccessible.gov if necessary or contact your Section 508 
Coordinator)

    Vendors may document conformance using [attached documentation/
industry-standard Voluntary Product Accessibility Template at http://www.itic.org/archives/articles/20040506/faq_voluntary_product_accessibility_template_vpat.php] (select the appropriate phrase within the brackets [ ]). 
Vendors should provide detailed information necessary for 
determining compliance, including defined contractor-incidental 
exceptions.

(End of clause)

PART 370--SPECIAL PROGRAMS AFFECTING ACQUISITION

0
121. Revise section 370.102 to read as follows:


370.102  Responsibilities.

    (a) The Contracting Officer shall include the clause in 352.270-1 
in every solicitation and resulting contract when the statement of work 
requires the contractor to conduct meetings, conferences, or seminars 
in accordance with 370.101(b).
    (b) The Project Officer shall be responsible for obtaining, 
reviewing, and approving the contractor's plan, which is to be 
submitted in response to paragraph (a) of the contract clause in 
352.270-1. A consolidated or master plan for contracts requiring 
numerous meetings, conferences, or seminars will be acceptable. The 
Project Officer, prior to approving the plan, should consult with the 
OPDIV or other designated organization responsible for ensuring 
compliance with the Architectural Barriers Act of 1968 and the 
Americans with Disabilities Act of 1990 to ensure that the contractor's 
plan meets the accessibility requirements of the contract clause. The 
Project Officer shall ask the responsible organization to review, and 
determine the adequacy of, the contractor's plan, and respond to the 
Project Officer, in writing, within ten (10) working days of receiving 
the request from the Project Officer.

0
122. Amend section 370.205 by revising paragraph (a) to read as 
follows:


370.205  Tribal preference requirements.

    (a) Where the work under a contract is to be performed on an Indian 
reservation, the contracting activity may supplement the clause set 
forth in 352.270-3 by adding specific Indian preference requirements of 
the Tribe on whose reservation the work is to be performed. The 
supplemental requirements shall be jointly developed for the contract 
by the contracting activity and the Tribe. Supplemental preference 
requirements must represent a further implementation of the 
requirements of section 7(b) of Public Law 93-638 and must be approved 
by the affected program director and approved for legal sufficiency by 
the General Law Division, OGC, or a regional attorney before being 
added to a solicitation and resultant contract. Any supplemental 
preference requirements to be added to the clause in 352.270-3 shall be 
included in the solicitation and clearly identified in order to insure 
uniform understanding of the additional requirements by all prospective 
bidders or offerors.
* * * * *

0
123. Revise section 370.301 to read as follows:


370.301  Policy.

    It is the policy of the Department of Health and Human Services 
(HHS) that no contract involving human subjects shall be awarded until 
acceptable assurance has been given that the activity will be subject 
to initial and continuing review by an appropriate Institutional Review 
Board (IRB) as described in HHS regulations at 45 CFR 46.103. An 
applicable Federalwide Assurance (FWA), approved by the HHS Office of 
Human Research Protections (OHRP), shall be required of each 
contractor, subcontractor, or cooperating institution having 
responsibility for human subjects involved in performance of the 
contract. The HHS OHRP is responsible for negotiating assurances 
covering all HHS-supported or HHS-conducted activities involving human 
subjects. OHRP shall guide Contracting Officers regarding nonaward or 
termination of a contract due to inadequate assurance or breach of 
assurance for protection of human subjects.

0
124. Revise section 370.302 to read as follows:


370.302  Types of assurances.

    (a) In January 2005, OHRP announced that the FWA would be the only 
new type of assurance accepted for review and approval by OHRP. 
Institutions holding an OHRP-approved Multiple Project Assurance (MPA) 
or Cooperative Project Assurance (CPA) were required to submit an FWA 
to OHRP for approval by December 31, 2005, if the institution is 
required to have an OHRP-approved assurance of compliance. Any Inter-
Institutional Amendment between an OHRP-approved MPA and an affiliate 
institution will be deactivated on January 1, 2006 if the affiliate 
institution has not obtained its own FWA. Single Project Assurances 
(SPAs) currently approved by OHRP will remain in effect for the 
duration of the project and through all non-competitive award renewals. 
An FWA listed in OHRP's current ``List of Registered Institutional 
Review Boards (IRBs)/Independent Ethics Committees (IECs) and Approved 
Assurances'' is acceptable for the purposes of this policy. The list 
may be found at http://ohrp.cit.nih.gov/search/asearch.asp.
    (b) The OHRP Web site includes links to instructions and the forms 
for submitting both a domestic and

[[Page 76515]]

international FWA at http://www.hhs.gov/ohrp/assurances/assurances_index.html. To expedite the approval of a FWA, as well as any update/
renewal, the institution shall use the OHRP Electronic Submission 
System. Once an electronic file is ``submitted'' to OHRP, the 
institution must fax or mail (do not do both) a copy of the signature 
page to initiate the review process. FWAs shall be mailed to the OHRP, 
U.S. Department of Health and Human Services, 1101 Wootton Parkway, 
Suite 200, Rockville, Maryland 20852, or faxed to OHRP at 240-453-8202 
(do not do both).

0
125. Revise section 370.303 to read as follows:


370.303  Notice to offerors.

    (a) Solicitations shall contain the notice to offerors in 352.270-
8(a) whenever contract performance is expected to involve human 
subjects.
    (b) IRB approval of proposals submitted by institutions having an 
OHRP-approved FWA should be certified in the manner required by 
instructions for completion of the contract proposal; or by completion 
of an OMB Form No. 0990-0263, ``Protection of Human Subjects Assurance 
Identification/IRB Certification/Declaration of Exemption (Common 
Rule); or by letter indicating the institution's OHRP-assigned FWA 
number, the date of IRB review and approval, and the type of review 
(convened or expedited). The date of IRB approval must not be more than 
12 months prior to the deadline for proposal submission.
    (c) FWAs for contractors, subcontractors, or cooperating 
institutions generally will not be requested prior to determination 
that a contract proposal has been selected for negotiation. When an FWA 
is submitted, it provides certification for the initial contract 
period. No additional documentation is required. If the contract 
provides for additional years to complete the project, the 
noncompetitive renewal proposal shall be certified in the manner 
described in the preceding paragraph.

0
126. Revise section 370.401 to read as follows:


370.401  Policy.

    (a) It is the policy of the Department of Health and Human Services 
(HHS) that no contract involving live vertebrate animals shall be 
awarded until acceptable assurance has been given that the activity 
will be subject to initial and continuing review by an appropriate 
Institutional Animal Care and Use Committee (IACUC) as described in the 
PHS Policy at IV.B.6. and 7. An applicable Full Animal Welfare 
Assurance or Interinstitutional Agreement/Assurance, approved by the 
Office of Laboratory Animal Welfare (OLAW), National Institutes of 
Health (NIH), shall be required of each contractor, subcontractor, or 
cooperating institution having responsibility for animal care and use 
involved in performance of the contract (see PHS Policy II., IV.A., and 
V.B.).
    (b) The OLAW, NIH, is responsible for negotiating assurances 
covering all HHS/PHS-supported or HHS/PHS-conducted activities 
involving the care and use of live vertebrate animals. OLAW shall guide 
Contracting Officers regarding adequate animal care, and use, approval, 
disapproval, restriction, or withdrawal of approval of assurances (see 
PHS Policy V.A.).

0
127. Revise section 370.402 to read as follows:


370.402  Assurances.

    (a) Assurances may be one of two types:
    (1) Full Animal Welfare Assurance (AWA). An AWA describes the 
institution's complete program for the care and use of animals, 
including but not limited to the facilities, occupational health, 
training, veterinary care, IACUC procedures and lines of authority and 
responsibility. An AWA listed in OLAW's list of institutions which have 
an approved full AWA will be considered acceptable for purposes of this 
policy.
    (2) Interinstitutional Agreement/Assurance (IAA). An IAA describes 
the arrangements between an offeror and usually a subcontractor where 
animal activities will occur. An IAA is limited to the specific award 
or single project.
    (b) The Contracting Officer shall forward copies of proposals 
selected for negotiation and requiring an assurance to the Assurance 
Branch, Office of Laboratory Animal Welfare (OLAW), NIH MSC 7507, 6100 
Executive Blvd., Room 3B01, Rockville, Maryland 20892, as early as 
possible to secure the necessary assurances.
    (c) A contractor providing animal care services at an assured 
entity, such as a Government-owned, contractor-operated (GOCO) site, 
does not need a separate assurance because the GOCO site normally 
covers the contractor services in the GOCO site assurance.

0
128. Revise section 370.403 to read as follows:


370.403  Notice to offerors.

    Solicitations shall contain the notice to offerors in 352.270-9(a) 
whenever contract performance is expected to involve the use of live 
vertebrate animals.
    (a) For offerors having a full AWA on file with OLAW, IACUC 
approval of the use of animals shall be submitted in the manner 
required by instructions for completion of the contract proposal, but 
prior to the technical review of the proposal. The date of IACUC review 
and approval must not be more than 36 months prior to the deadline for 
proposal submission.
    (b) Non-assured offerors are not required to submit assurances or 
IACUC approval with proposals. OLAW will contact contractors, 
subcontractors and cooperating institutions to negotiate necessary 
assurances and verify IACUC approvals when requested by appropriate 
HHS/PHS staff.
0
129. Revise section 370.504 to read as follows:


370.504  Competition.

    (a) Contracts awarded under the Buy Indian Act are subject to 
competition among Indians or Indian concerns to the maximum extent that 
the Contracting Officer determines is practicable. When competition is 
determined not to be practicable, a Justification for Other than Full 
and Open Competition shall be prepared in accordance with 306.303 and 
subsequently retained in the contract file.
    (b) Solicitations must be synopsized and publicized in FedBizOpps 
at http://www.fedbizopps.gov and copies of the synopses sent to the 
tribal office of the Indian tribal government directly concerned with 
the proposed acquisition as well as to Indian concerns and others 
having a legitimate interest. The synopsis must state that the 
acquisition is restricted to Indian firms under the Buy Indian Act.

[FR Doc. E6-21505 Filed 12-19-06; 8:45 am]
BILLING CODE 4150-28-P