[Federal Register Volume 74, Number 85 (Tuesday, May 5, 2009)]
[Rules and Regulations]
[Pages 20605-20606]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E9-10259]



48 CFR Parts 537 and 552

[GSAR Amendment 2009-03; GSAR Case 2008-G510 (Change 29)Docket 2008-
0007; Sequence 4]
RIN 3090-AI54

General Services Administration Acquisition Regulation; GSAR Case 
2008-G510; Rewrite of GSAR Part 537, Service Contracting

AGENCIES: General Services Administration (GSA), Office of the Chief 
Acquisition Officer.

ACTION: Final rule.


SUMMARY: The General Services Administration (GSA) is amending the 
General Services Administration Acquisition Regulation (GSAR) by 
revising the text addressing service contracting. This rule is a result 
of the General Services Administration Acquisition Manual (GSAM) 
rewrite initiative undertaken by GSA to revise the GSAM to maintain 
consistency with the Federal Acquisition Regulation (FAR), and to 
implement streamlined and innovative acquisition procedures that 
contractors, offerors, and GSA contracting personnel can utilize when 
entering into and administering contractual relationships. The GSAM 
incorporates the GSAR as well as internal agency acquisition policy.

DATES: Effective Date: June 4, 2009.

FOR FURTHER INFORMATION CONTACT For clarification of content, contact 
Michael O. Jackson, Procurement Analyst, at (202) 208-4949. For 
information pertaining to status or publication schedules, contact the 
Regulatory Secretariat (VPR), Room 4041, GS Building, Washington, DC, 
20405, (202) 501-4755. Please cite Amendment 2009-03, GSAR case 2008-
G510 (Change 29).


A. Background

    An Advance Notice of Proposed Rulemaking (ANPR) with request for 
comments on all parts of the GSAM was published in the Federal Register 
at 71 FR 7910 on February 15, 2006. No comments were received on Part 
537. However, internal review comments have been incorporated as 
appropriate. A proposed rule for the regulatory portion of the GSAM was 
published in the Federal Register at 73 FR 32276 on June 6, 2008. In 
addition, GSA Acquisition Letter V-05-11, entitled, ``Exclusion of 
Leases or Leasehold Interest in Real Property from the Use of 
Performance-Based Contracting,'' dated June 6, 2005, was incorporated 
into Subpart 537.102-70. The public comment period for the proposed 
rule on GSAR Part 537 closed on August 5, 2008, and four (4) comments 
were received from one (1) commenter.
    The Rewrite of Part 537
    This final rule contains the revisions made to GSAR Subpart 537, 
Service Contracting. The rule revises GSAR Subpart 537 to address the 
text at GSAR 537.101, Definitions; GSAR 537.110 Solicitation provisions 
and contract clauses; provision GSAR 552.237-70, Qualifications of 
Offerors; and clause GSAR 552.237-73, Restriction on Disclosure of 
Information. The language in GSAR 537.101, Definitions, is removed from 
inclusion in the GSAR. This language clarifies the definition for 
``contracts for building services'' for contracting officers; 
therefore, this language is being incorporated as non-regulatory GSAM 
language. In addition, because these definitions may have impact beyond 
the agency, GSAM 537.201, Definitions, is being made regulatory with 
deletions in the definitions where the GSAM language was redundant with 
the FAR. GSAR clauses 552.237-71, Qualifications of Employees and 
552.237-72, Prohibition Regarding ``Quasi-Military Armed Forces'' are 
retained with no changes, except minor edits to correct clause 
prescription references.
    GSAR 537.102-70 was written to incorporate the policy that GSA 
contracting activities are not required to use performance-based 
acquisition (PBA) methods for leases and leasehold interests in real 
property from GSA Acquisition Letter V-05-11, dated June 6, 2005.
    Discussion of Comments
    A proposed rule was published in the Federal Register at 73 FR 
32276 on June 6, 2008. The comment period closed August 5, 2008, and 
four (4) comments were received from one (1) commenter. Also, GSA 
Acquisition Letter V-05-11, published on June 6, 2005, was incorporated 
in the final rule.
    Comment 1: One commenter responded that GSAM 552.237-70 clause is 
misleading in that it refers to ``qualifications'' within the same 
context that it discusses determinations of ``responsibility'' which 
the commenter believes are two totally different requirements with 
separate applications and procedures. The commenter believes this 
clause is inappropriate for the reasons cited below.
     The issues of ``financial resources'' and ``performance 
capability'' both fall under FAR 9.1's responsibility standards. 
Conversely, ``qualifications'' go to the ``quality'' of the service 
that must ``be addressed in every source selection through 
consideration of one or more non-cost evaluation factors such as past 
performance, compliance with solicitation requirements, technical 
excellence, management capability, personnel qualifications, and prior 
experience'' and references FAR 15.304(c)(2) and FAR 15.202(a). 
Consequently, factors dealing with ``comparable contracts,'' 
``experience,'' and ``competency in performing 
comparable[hellip]contracts'' fall under the realm of quality or 
qualifications as outlined in FAR 15 rather than FAR 9.1 responsibility 
standards. Qualifications must be ``evaluated'' as part of the 
technical factors, and related standards/ criteria that are outlined in 
the RFP/solicitation.
     Since ``qualifications'' must be specifically addressed in 
the RFP, as required under FAR 15.3's Source Selection procedures, and 
responsibility standards are already addressed in FAR 9.1, the 
commenter recommends GSA delete this clause on the basis that it is 
inappropriate, ambiguous, impractical, and unnecessary.
     If the clause is retained, the commenter questions its 
applicability only to building service contracts. The commenter's 
position is that qualifications and responsibility matters could apply 
to all contracts including supply, construction, A-E, as well as all 
professional services. If retained, the commenter recommends that GSA 
consider moving the clause under GSAM 509.2 to align with FAR 9.2's 
``Qualifications Requirements.''
    Response: Nonconcur. The information summarizes the requirements 
for the performance of building service contracts that is not found in 
other parts of the FAR and GSAM. The GSA position is that the FAR and 
GSAM coverage is adequate for responsibility and qualifications 

[[Page 20606]]

    Comment 2: The commenter stated that FAR 9.1 deals with 
``responsibility'' requirements that apply to all ``prospective 
contractors'' including sealed bid competitors. However, competitors' 
qualifications cannot be considered in a sealed bid procurement which 
is limited to ``only price and the price-related factors'' per FAR 
14.408-1(a). Pursuant to FAR 14.103-2(d), ``An award is made to the 
responsible bidder (see 9.1)''[hellip]Also see FAR 14.408-2(a) which 
says, ``The contracting officer shall determine that a prospective 
contractor is responsible (per FAR 9.1)[hellip]'' Therefore, GSA should 
consider revising the GSAM/GSAR 537.110(a) prescription to prohibit its 
use, for qualifying firms, on sealed bid procurements.
    Response: Nonconcur. Contracting activities are encouraged not to 
use sealed bidding procedures for building service contracts, however, 
some activities still use the sealed bidding procedures for smaller 
building service contract actions.
    Comment 3: The commenter refers to comments covering GSAM 509 which 
allows Contracting Officers to use the GSA Form 527 to ``furnish a 
statement of its financial resources,'' yet fails to require 
Contracting Officers to document any analytical report to reflect 
review of same with conclusory findings.
    Response: This comment is outside the scope of this GSAR case.
    Comment 4: Commenter stated that they considered it a ``reporting 
burden'' for GSA to not allow comments to be submitted electronically 
on this notice.
    Response: Comments on this case were accepted electronically.
    This is not a significant regulatory action and, therefore, was not 
subject to review under Section 6(b) of Executive Order 12866, 
Regulatory Planning and Review, dated September 30, 1993. This rule is 
not a major rule under 5 U.S.C. 804.

B. Regulatory Flexibility Act

    The General Services Administration does not expect this final rule 
to have a significant economic impact on a substantial number of small 
entities within the meaning of the Regulatory Flexibility Act, 5 U.S.C. 
601, et seq., because the changes in the final rule are editorial in 
nature, e.g., changing a definition from regulatory to non-regulatory, 
adding the new name of the Javits-Wagner-O'Day (JWOD) program of 
Ability One, eliminating redundancy with regard to GSAR and FAR 
definitions at GSAR 537.201 and making minor edits to GSAR 552.237-70 
and 552.237-73.

C. Paperwork Reduction Act

    The Paperwork Reduction Act does apply; however, these changes to 
the GSAR do not impose additional information collection requirements 
to the paperwork burden previously approved under OMB Control Number 

List of Subjects in 48 CFR Parts 537 and 552

    Government procurement.

    Dated: March 11, 2009
Rodney P. Lantier,
Acting, Senior Procurement Executive, Office of the Chief Acquisition 
Officer, General Services Administration.

Therefore, GSA amends 48 CFR parts 537 and 552 as set forth below:


1. The authority citation for 48 CFR part 537 is revised to read as 

    Authority:  40 U.S.C. 121(c).

537.101  [Removed]

2. Remove section 537.101.

537.110  [Amended]

3. Amend section 537.110 by removing from the introductory text of 
paragraph (a) ``initiated under'' and adding ``initiated with Ability 
One under'' in its place.
4. Add section 537.201 to read as follows:

537.201  Definitions.

    As used in this subpart--
    Evaluation or analysis of a proposal means proposal evaluation as 
described in FAR 15.305. It includes: Cost or price evaluation using 
cost or price analysis, as defined in FAR 15.404.
    Proposal means a proposal submitted for an initial contract award. 
(See FAR 37.203(d)). It does not include proposals submitted after 
contract award, such as value engineering proposals, proposals related 
to contract modifications, claims, or other contract administration 
    Readily available means that employees with the requisite training 
and capability are employed by the agency, capable of handling 
additional work relating to other duties as assigned by management, and 
that the travel and other costs associated with using covered personnel 
does not exceed the projected cost of a contract for evaluation and 
analysis services.
    Requisite training and capability means training and capability 
necessary to successfully perform the task or contract at issue in the 
time and in the manner required. It may include relevant experience, 
recent performance of work of similar size and scope, specific training 
and other factors that the contracting officer determines are necessary 
to the successful performance of the task or contract at issue.


5. The authority citation for 48 CFR part 552 continues to read as 

    Authority:  40 U.S.C. 121(c).
6. Amend section 552.237-70 by revising the date of the provision and 
the second sentence in paragraph (a) to read as follows:

552.237-70  Qualifications of Offerors.

* * * * *


    (a) * * * To determine an Offeror's qualifications, the Offeror may 
be requested to furnish a narrative statement listing comparable 
contracts which it has performed; a general history of its operating 
organization; and its complete experience. * * *
* * * * *
7. Amend section 552.237-71 by revising the introductory paragraph to 
read as follows:

552.237-71  Qualifications of Employees.

    As prescribed in 537.110(a), insert the following clause:
* * * * *
8. Amend section 552.237-72 by revising the introductory paragraph to 
read as follows:

552.237-72  Prohibition Regarding ``Quasi-Military Armed Forces.''

    As prescribed in 537.110(b), insert the following clause:
* * * * *
9. Amend section 552.237-73 by revising the date of the clause and 
paragraph (b) to read as follows:

552.237-73  Restriction on Disclosure of Information.

* * * * *


* * * * *
    (b) The Contractor shall not disclose any information concerning 
the work under this contract to any persons or entity unless the 
Contractor obtains prior written approval from the Contracting Officer.
* * * * *
[FR Doc. E9-10259 Filed 5-4-09; 8:45 am]