[Federal Register Volume 72, Number 166 (Tuesday, August 28, 2007)]
[Rules and Regulations]
[Pages 49204-49207]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E7-17037]


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DEPARTMENT OF DEFENSE

Defense Acquisition Regulations System

48 CFR Parts 212, 215, 247, and 252

RIN 0750-AF75


Defense Federal Acquisition Regulation Supplement; Carriage 
Vessel Overhaul, Repair, and Maintenance (DFARS Case 2007-D001)

AGENCY: Defense Acquisition Regulations System, Department of Defense 
(DoD).

ACTION: Interim rule with request for comments.

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SUMMARY: DoD has issued an interim rule amending the Defense Federal 
Acquisition Regulation Supplement (DFARS) to implement Section 1017 of 
the National Defense Authorization Act for Fiscal Year 2007. Section 
1017 requires DoD to establish an evaluation criterion, for use in 
obtaining carriage of cargo by vessel, that considers the extent to 
which an offeror has had overhaul, repair, and maintenance work for 
covered vessels performed in shipyards located in the United States or 
Guam.

DATES: Effective date: August 28, 2007.
    Comment date: Comments on the interim rule should be submitted in 
writing to the address shown below on or before October 29, 2007, to be 
considered in the formation of the final rule.

ADDRESSES: You may submit comments, identified by DFARS Case 2007-D001, 
using any of the following methods:
     Federal eRulemaking Portal: http://www.regulations.gov. 
Follow the instructions for submitting comments.
     E-mail: dfars@osd.mil. Include DFARS Case 2007-D001 in the 
subject line of the message.
     Fax: (703) 602-7887.
     Mail: Defense Acquisition Regulations System, Attn: Mr. 
Mark Gomersall, OUSD(AT&L)DPAP(DARS), IMD 3D139, 3062 Defense Pentagon, 
Washington, DC 20301-3062.
     Hand Delivery/Courier: Defense Acquisition Regulations 
System, Crystal Square 4, Suite 200A, 241 18th Street, Arlington, VA 
22202-3402.
    Comments received generally will be posted without change to http://www.regulations.gov, including any personal information provided.

FOR FURTHER INFORMATION CONTACT: Mr. Mark Gomersall, (703) 602-0302.

SUPPLEMENTARY INFORMATION:

A. Background

    This interim rule implements Section 1017 of the National Defense 
Authorization Act for Fiscal Year 2007 (Pub. L. 109-364). Section 1017 
requires DoD to issue an acquisition policy that establishes, as a 
criterion required to be considered in obtaining carriage of cargo by 
vessel for DoD, the extent to which an offeror of such carriage has had 
overhaul, repair, and maintenance work for covered vessels performed in 
shipyards located in the United States or Guam. Section 1017 defines 
``covered vessel'' as one that is (1) Owned, operated, or controlled by 
the offeror, and (2) qualified to engage in the carriage of cargo in 
the coastwise or noncontiguous trade under Section 27 of the Merchant 
Marine Act (46 U.S.C. 883); 46 U.S.C. 12106; and Section 2 of the 
Shipping Act (46 U.S.C. App. 802). Section 1017 also requires DoD to 
submit an annual report to the congressional defense committees 
regarding overhaul, repair, and maintenance performed on covered 
vessels of each offeror of carriage to which the acquisition policy 
applies. The interim rule contains a solicitation provision and 
corresponding prescriptive language to address the statutory 
requirements. The solicitation provision includes a definition of 
``overhaul, repair, and maintenance work'' consistent with the 
definition in Commander Military Sealift Command Instruction 4700.14B; 
and a definition of ``shipyards'' consistent with the definition 
applicable to NAICS Code 336611, Ship Building and Repairing.
    This rule was not subject to Office of Management and Budget review 
under Executive Order 12866, dated September 30, 1993.

B. Regulatory Flexibility Act

    DoD has prepared an initial regulatory flexibility analysis 
consistent with 5 U.S.C. 603. A copy of the analysis may be obtained 
from the point of contact specified herein. The analysis is summarized 
as follows:
    The objective of the rule is to maintain a strong national ship 
repair industrial base. Therefore, the rule contains an evaluation 
preference for use in DoD solicitations for carriage of cargo by 
vessel, to apply to those entities that use domestic shipyards for 
vessel overhaul, repair, and maintenance. The requirements of the rule 
will apply to entities interested in receiving DoD contracts for 
carriage of cargo by vessel. An evaluation preference will be given to 
offerors of carriage who use domestic shipyards for vessel overhaul, 
repair, and

[[Page 49205]]

maintenance work. This is expected to have a positive effect on 
entities owning domestic shipyards, by encouraging the use of those 
shipyards.
    DoD invites comments from small businesses and other interested 
parties. DoD also will consider comments from small entities concerning 
the affected DFARS subparts in accordance with 5 U.S.C. 610. Such 
comments should be submitted separately and should cite DFARS Case 
2007-D001.

C. Paperwork Reduction Act

    This interim rule contains a new information collection 
requirement. The Office of Management and Budget (OMB) has approved the 
information collection requirement for use through February 29, 2008, 
under OMB Control Number 0704-0445, in accordance with the emergency 
processing procedures of 5 CFR 1320.13. DoD invites comments on the 
following aspects of the interim rule: (a) Whether the collection of 
information is necessary for the proper performance of the functions of 
DoD, including whether the information will have practical utility; (b) 
the accuracy of the estimate of the burden of the information 
collection; (c) ways to enhance the quality, utility, and clarity of 
the information to be collected; and (d) ways to minimize the burden of 
the information collection on respondents, including the use of 
automated collection techniques or other forms of information 
technology. The following is a summary of the information collection 
requirement.
    Title: Defense Federal Acquisition Regulation Supplement (DFARS); 
Subpart 247.5, Carriage Vessel Overhaul, Repair, and Maintenance.
    Type of Request: New collection.
    Number of Respondents: 15.
    Responses Per Respondent: 1.
    Annual Responses: 15.
    Average Burden Per Response: 1.5 hours.
    Annual Burden Hours: 22.5.
    Needs and Uses: DoD needs this information to implement Section 
1017 of the National Defense Authorization Act for Fiscal Year 2007 
(Public Law 109-364). Section 1017 requires DoD to (1) Issue an 
acquisition policy establishing an evaluation criterion, for use in 
obtaining carriage of cargo by vessel, that considers the extent to 
which an offeror has had overhaul, repair, and maintenance work for 
covered vessels performed in shipyards located in the United States or 
Guam; and (2) submit an annual report to the congressional defense 
committees regarding overhaul, repair, and maintenance performed on 
covered vessels of each offeror to which the acquisition policy 
applies.
    Affected Public: Businesses or other for-profit institutions.
    Respondent's Obligation: Required to obtain or retain benefits.
    Frequency: On occasion.
    Written comments and recommendations on the proposed information 
collection should be sent to Ms. Hillary Fielden at the Office of 
Management and Budget, Desk Officer for DoD, Room 10236, New Executive 
Office Building, Washington, DC 20503, with a copy to the Defense 
Acquisition Regulations System, Attn: Mr. Mark Gomersall, 
OUSD(AT&L)DPAP(DARS), IMD 3D139, 3062 Defense Pentagon, Washington, DC 
20301-3062. Comments can be received from 30 to 60 days after the date 
of this notice, but comments to OMB will be most useful if received by 
OMB within 30 days after the date of this notice.
    To request more information on this proposed information collection 
or to obtain a copy of the proposal and associated collection 
instruments, please write to the Defense Acquisition Regulations 
System, Attn: Mr. Mark Gomersall, OUSD(AT&L)DPAP(DARS), IMD 3D139, 3062 
Defense Pentagon, Washington, DC 20301-3062.

D. Determination To Issue an Interim Rule

    A determination has been made under the authority of the Secretary 
of Defense that urgent and compelling reasons exist to publish an 
interim rule prior to affording the public an opportunity to comment. 
This interim rule implements Section 1017 of the National Defense 
Authorization Act for Fiscal Year 2007 (Pub. L. 109-364). Section 1017 
requires DoD to issue an acquisition policy that establishes an 
evaluation criterion, for use in obtaining carriage of cargo by vessel, 
that considers the extent to which an offeror of such carriage has had 
overhaul, repair, and maintenance work for covered vessels performed in 
shipyards located in the United States or Guam. In addition, Section 
1017 requires DoD to submit an annual report to the congressional 
defense committees regarding overhaul, repair, and maintenance 
performed on covered vessels of each offeror to which the acquisition 
policy applies. Comments received in response to this interim rule will 
be considered in the formation of the final rule.

List of Subjects in 48 CFR Parts 212, 215, 247, and 252

    Government procurement.

Michele P. Peterson,
Editor, Defense Acquisition Regulations System.

0
Therefore, 48 CFR parts 212, 215, 247, and 252 are amended as follows:
0
1. The authority citation for 48 CFR parts 212, 215, 247, and 252 
continues to read as follows:

    Authority: 41 U.S.C. 421 and 48 CFR Chapter 1.

PART 212--ACQUISITION OF COMMERCIAL ITEMS

0
2. Section 212.301 is amended by adding paragraph (f)(xiii) to read as 
follows:


212.301  Solicitation provisions and contract clauses for the 
acquisition of commercial items.

    (f) * * *
    (xiii) Use the provision at 252.247-7026, Evaluation Preference for 
Use of Domestic Shipyards--Applicable to Acquisition of Carriage by 
Vessel for DoD Cargo in the Coastwise or Noncontiguous Trade, as 
prescribed in 247.574(e).

0
3. Section 212.602 is amended by revising paragraph (b)(iii) to read as 
follows:


212.602  Streamlined evaluation of offers.

    (b) * * *
    (iii) For the direct purchase of ocean transportation services, 
also evaluate offers in accordance with the criteria at 247.573-2(c).

PART 215--CONTRACTING BY NEGOTIATION

0
4. Section 215.304 is amended by adding paragraph (c)(iii) to read as 
follows:


215.304  Evaluation factors and significant subfactors.

    (c) * * *
    (iii) See 247.573-2(c) for additional evaluation factors required 
in solicitations for the direct purchase of ocean transportation 
services.

PART 247--TRANSPORTATION

0
5. Section 247.570 is amended by revising paragraph (a) to read as 
follows:


247.570  Scope.

* * * * *
    (a) Implements--
    (1) The Cargo Preference Act of 1904 (``the 1904 Act''), 10 U.S.C. 
2631, which applies to the ocean transportation of

[[Page 49206]]

cargo owned by, or destined for use by, DoD; and
    (2) Section 1017 of the National Defense Authorization Act for 
Fiscal Year 2007 (Pub. L. 109-364), which requires consideration of the 
extent to which offerers have had overhaul, repair, and maintenance 
work performed in shipyards located in the United States or Guam;
* * * * *


247.571, 247.572-1, 247.572-2, and 247.573  [Redesignated as 247.572, 
247.573-1, 247.573-2, and 247.574]

0
6. Sections 247.571, 247.572-1, 247.572-2, and 247.573 are redesignated 
as sections 247.572, 247.573-1, 247.573-2, and 247.574, respectively.

0
7. A new section 247.571 is added to read as follows:


247.571  Definitions.

    Covered vessel, overhaul, repair, and maintenance work, and 
shipyards, as used in this subpart, have the meaning given in the 
provision at 252.247-7026, Evaluation Preference for Use of Domestic 
Shipyards--Applicable to Acquisition of Carriage by Vessel for DoD 
Cargo in the Coastwise or Noncontiguous Trade.

0
8. Newly designated section 247.572 is amended by revising paragraphs 
(a)(1) through (3) and adding paragraph (d) to read as follows:


247.572  Policy.

    (a) * * *
    (1) Those vessels are not available, and the procedures at 247.573-
1(c)(1) or 247.573-2(d)(1) are followed;
    (2) The proposed charges to the Government are higher than charges 
to private persons for the transportation of like goods, and the 
procedures at 247.573-1(c)(2) or 247.573-2(d)(2) are followed; or
    (3) The Secretary of the Navy or the Secretary of the Army 
determines that the proposed freight charges are excessive or 
unreasonable in accordance with 247.573-1(c)(3) or 247.573-2(d)(3).
* * * * *
    (d) In accordance with Section 1017 of the National Defense 
Authorization Act for Fiscal Year 2007 (Public Law 109-364)--
    (1) When obtaining carriage by vessel, DoD must consider the extent 
to which offerors have had overhaul, repair, and maintenance work for 
covered vessels performed in shipyards located in the United States or 
Guam; and
    (2) DoD must submit an annual report to the congressional defense 
committees, addressing the information provided by offerors with regard 
to overhaul, repair, and maintenance for covered vessels performed in 
the United States or Guam.

0
9. Section 247.573 is added to read as follows:


247.573  Procedures.

0
10. Newly designated section 247.573-2 is amended as follows:
0
a. By revising paragraph (c); and
0
b. In paragraph (d)(3)(i) introductory text and paragraph (d)(3)(i)(C), 
by removing ``247.572'' and adding in its place ``247.573''.
    The revised text reads as follows:


247.573-2  Direct purchase of ocean transportation services.

* * * * *
    (c) All solicitations within the scope of this subsection must 
provide--
    (1) A preference for U.S.-flag vessels in accordance with the 1904 
Act;
    (2) An evaluation factor or subfactor for offeror participation in 
the Voluntary Intermodal Sealift Agreement; and
    (3) An evaluation factor or subfactor considering the extent to 
which offerors have had overhaul, repair, and maintenance work for 
covered vessels performed in shipyards located in the United States or 
Guam.
* * * * *

0
11. Section 247.573-3 is added to read as follows:


247.573-3  Annual reporting requirement.

    (a) No later than February 15th of each year, departments and 
agencies shall--
    (1) Prepare a report containing all information received from 
offerors in response to the provision at 252.247-7026 during the 
previous calendar year; and
    (2) Submit the report to: Directorate of Acquisition, U.S. 
Transportation Command, ATTN: TCAQ, 508 Scott Drive, Scott AFB, IL 
62225-5357.
    (b) The Director of Acquisition, U.S. Transportation Command, will 
submit a consolidated report to the congressional defense committees in 
accordance with Section 1017 of Public Law 109-364.

0
12. Newly designated section 247.574 is amended as follows:
0
a. By revising the section heading;
0
b. In paragraph (d), by removing ``247.571'' and adding in its place 
``247.572''; and
0
c. By adding paragraph (e) to read as follows:


247.574  Solicitation provisions and contract clauses.

* * * * *
    (e) Use the provision at 252.247-7026, Evaluation Preference for 
Use of Domestic Shipyards--Applicable to Acquisition of Carriage by 
Vessel for DoD Cargo in the Coastwise or Noncontiguous Trade, in 
solicitations for carriage of cargo by vessel for DoD. See 247.573-3 
for reporting of the information received from offerors in response to 
the provision.

PART 252--SOLICITATION PROVISIONS AND CONTRACT CLAUSES


252.247-7022  [Amended]

0
13. Section 252.247-7022 is amended in the introductory text by 
removing ``247.573'' and adding in its place ``247.574''.


252.247-7023  [Amended]

0
14. Section 252.247-7023 is amended in the introductory text, and in 
the introductory text of Alternates I, II, and III, by removing 
``247.573'' and adding in its place ``247.574''.


252.247-7024  [Amended]

0
15. Section 252.247-7024 is amended in the introductory text by 
removing ``247.573'' and adding in its place ``247.574''.


252.247-7025  [Amended]

0
16. Section 252.247-7025 is amended in the introductory text by 
removing ``247.573'' and adding in its place ``247.574''.

0
17. Section 252.247-7026 is added to read as follows:


252.247-7026  Evaluation Preference for Use of Domestic Shipyards--
Applicable to Acquisition of Carriage by Vessel for DoD Cargo in the 
Coastwise or Noncontiguous Trade.

    As prescribed in 247.574(e), use the following provision:

Evaluation Preference For Use of Domestic Shipyards--Applicable To 
Acquisition of Carriage by Vessel for DoD Cargo in the Coastwise or 
Noncontiguous Trade (Aug 2007)

    (a) Definitions. As used in this provision--
    Covered vessel means a vessel--
    (1) Owned, operated, or controlled by the offeror; and
    (2) Qualified to engage in the carriage of cargo in the coastwise 
or noncontiguous trade under Section 27 of the Merchant Marine Act, 
1920 (46 U.S.C. App. 883), commonly referred to as ``Jones Act''; 46 
U.S.C. 12106; and Section 2 of the Shipping Act, 1916 (46 U.S.C. App. 
802).
    Overhaul, repair, and maintenance work means work requiring a 
pierside shipyard period greater than or equal to 15 calendar days.

[[Page 49207]]

    Shipyards means fixed facilities with drydocks and fabrication 
equipment capable of building a ship, defined as watercraft typically 
suitable or intended for other than personal or recreational use.
    (b) This solicitation includes an evaluation factor that considers 
the extent to which the offeror has had overhaul, repair, and 
maintenance work for covered vessels performed in shipyards located in 
the United States or Guam.
    (c) The offeror shall provide the following information with its 
offer, addressing all covered vessels for which overhaul, repair, and 
maintenance work has been performed during the period covering the 
current calendar year, up to the date of proposal submission, and the 
preceding four calendar years:
    (1) Name of vessel.
    (2) Description of qualifying shipyard work performed.
    (3) Name of shipyard that performed the work.
    (4) Inclusive dates of work performed.
    (5) Cost of work performed.
    (d) Offerors are responsible for submitting accurate information. 
The Contracting Officer--
    (1) Will use the information to evaluate offers in accordance with 
the criteria specified in the solicitation; and
    (2) Reserves the right to request supporting documentation if 
determined necessary in the proposal evaluation process.
    (e) The Department of Defense will provide the information 
submitted in response to this provision to the congressional defense 
committees, as required by Section 1017 of Public Law 109-364.


(End of provision)

 [FR Doc. E7-17037 Filed 8-27-07; 8:45 am]
BILLING CODE 5001-08-P