[Federal Register Volume 74, Number 179 (Thursday, September 17, 2009)]
[Rules and Regulations]
[Pages 47737-47740]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E9-22209]


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GENERAL SERVICES ADMINISTRATION

48 CFR Parts 501, 514, and 552

[GSAR Amendment 2009-11; GSAR Case 2008-G505 (Change 39); Docket 2008-
0007; Sequence 20]
RIN 3090-AI73


General Services Acquisition Regulation; GSAR Case 2008-G505; 
Rewrite of GSAR Part 514, Sealed Bidding

AGENCY: Office of Acquisition Policy, General Services Administration 
(GSA).

ACTION: Final rule.

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SUMMARY: The General Services Administration (GSA) is amending the GSA 
Acquisition Regulation (GSAR) by revising the sections of GSAR Part 514 
that provide requirements for sealed bidding. This rule is a result of 
the GSA 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, bidders, 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: October 19, 2009.

FOR FURTHER INFORMATION CONTACT: For clarification of content, contact 
Mr. Michael O. Jackson at (202) 208-4949. For information pertaining to 
the status or publication schedules, contact the Regulatory Secretariat 
(VPR), 1800 F Street, NW., Room 4041, Washington, DC 20405, (202) 501-
4755. Please cite GSAR Case 2008-G505 (Change 39), in all 
correspondence.

SUPPLEMENTARY INFORMATION:

A. Background

    The GSA is amending the GSAR to revise sections of GSAR Part 514 
that provide requirements for sealed bidding.
    This final rule is a result of the GSA 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, bidders, 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.
    The GSA will rewrite each part of the GSAR and GSAM, and as each 
GSAR part is rewritten, will publish it in the Federal Register.
    This rule covers the rewrite of GSAR Part 514. The specific changes 
are as follows:
    501.106 OMB Approval under the Paperwork Reduction Act.
     Added OMB Control No. 3090-0162 as a cross reference for 
514.201-1.
    514.201-2 Part I--The Schedule.
     Changed paragraph (a) from ``When you'' to ``When using''. 
Also in paragraph (a) changed ``which'' to ``that'' and added all three 
FAR clauses for Prompt Payment (52.232-25, 52.232-26, and 52.232-27).
     Changed the word ``offer'' to ``bid''.
     Changed paragraph (b) from ``When you use'' to ``When 
using'' to clarify the reference to ``you'' and added a reference to 
the Standard Form 1449 as an example that this form can also be used.
    514.201-6 Solicitation provisions.
     Changed ``When you'' to ``When considering'' to delete the 
reference to the word ``you''.
     Changed ``All or None Offers'' to ``All or None Bids''.
     Deleted the reference for Alternate I because the 
alternate is being proposed for deletion because it is not consistent 
with the intention of the basic clause.
    514.201-7 Contract clauses.
     In the old paragraph (a) changed ``you'' to ``The 
contracting officer''.
     Deleted paragraph (b), Examination of Records. The clause 
does not provide basic audit rights that are in addition to the FAR 
clauses at 52.215-2, Audit and Records--Negotiation and 52.214-26, 
Audit and Records--Sealed Bidding. And as opposed to the GSA clause, 
the FAR clause is specific to sealed bids. Further, the GSA clause 
grants to the agency rights to audit subcontractors that are in excess 
of those granted by the FAR and the statute.
    514.202-4 Bid samples.
     Renamed paragraphs (a) and (b) to be more consistent with 
the FAR.
     Also in paragraphs (a) and (b) restructured the language 
to remove the word ``you'' and replaced with contracting officer.
     Clarified the language to state who must take physical 
custody of bid samples.
     Deleted paragraph (c) because it is redundant with FAR 
14.202-4(d).
    514.202-5 Descriptive Literature.
     Added a new GSAR section in order to address the 
requirements of FAR 14.202-5(c).
    514.270-1 Definition. Deleted hyphenation in ``separately-priced''.
    514.270-2 Justification for use.
     Inserted ``the contracting officer should'' in paragraph 
(b) and made last sentence of paragraph (3) a new number paragraph (4) 
and renumbered old paragraphs (4) and (5) to paragraphs (5) and (6), 
respectively.
     Added ``the contracting officer should'' to replace the 
understood ``you'' and deleted ``Do'' in paragraph (c).
    514.270-3 Evaluation factors for award.
     Edited to avoid either using the passive voice or 
repeating ``the contracting officer''.
    514.270-4 Grouping line items for aggregate award.
     In paragraph (a) the title ``Type of contract'' was 
changed to one that is more descriptive of the substance of the 
paragraph; type of contract refers to Part 16 contract types.

[[Page 47738]]

     In paragraph (b) changed the ``when you group'' to ``when 
grouping'' and in paragraph (d)(3)(i) changed ``It can cause you to 
lose'' to ``It can cause the loss of''.
     In paragraph (d)(2) changed ``respond'' to ``responded''.
    514.270-6 Guidelines for using the weight factors method.
     In paragraph (a) changed ``you have'' to ``there are''.
     In paragraph (d) changed ``You may reduce estimated 
quantities'' to ``Estimated quantities may be reduced''.
     In paragraph (e) deleted the ``you'' in the first 
sentence.
    514.270-7 Guidelines for using the price list method.
     In paragraph (a) changed ``you need to make'' to 
``making''.
     In paragraph (b) changed ``When you use'' to ``using''.
     In paragraph (c) changed ``You may develop price lists'' 
to ``Price lists may be developed''.
     In paragraph (d) changed ``you use'' to ``the contracting 
officer uses'' and changed ``You may provide'' to ``This information 
may be provided''.
     In paragraph (e) changed ``You may use prices'' to 
``Prices may be used''.
     In paragraph (h) changed ``If you cannot estimate the 
Government's needs'' to ``If the Government's needs cannot be 
estimated''.
     In paragraph (i)(6) changed ``If you provide'' to ``If 
providing''.
     In paragraph (i)(8) deleted the sentence in its entirety 
and replaced it with ``When the solicitation further groups united 
prices by trade or business category, multiple percentages may be 
required''.
    514.407-3 Other mistakes disclosed before award.
     Deleted paragraph (b) because it is redundant with FAR 
14.407-3(f).
     Renumbered old paragraphs (1) and (2) as paragraphs (a) 
and (b), respectively.
    514.407-4 Mistakes after award.
     Added ``are required to'' and changed ``your'' to ``the 
contracting officer's''.
    552.214-70 ``All or None'' Bids.
     In paragraph (a) deleted the first part of the sentence so 
it now to begins with ``The Government . . . .''
     Deleted Alternate I in its entirety to match the changes.
     Changed all occurrences of the word ``offer'' to ``bid''.
    552.214-71 Progressive Awards and Monthly Quantity Allocations.
     Changed all occurrences of the words ``offeror'', 
``offer'' or ``offering'' to ``bidder'', ``bid'', or bidding.
    552.214-72 Bid Sample Requirements.
     Deleted ``NOTE: (1)'' because it is redundant.
    Discussion of Comments
    A proposed rule for the regulatory portion of the GSAM was 
published in the Federal Register at 73 FR 60225 on October 10, 2008. 
The public comment period for GSAR Part 514 closed on December 9, 2008, 
and four (4) comments were received. A discussion of these comments is 
provided below:
    Comment 1: 514.201-2.
    ``(See FAR 52.232-25)'' has been added to the subsection. However, 
that is only one of three Prompt Payment clauses. Recommend all three 
clauses be referenced as historically construction has been procured 
with sealed bidding. While that has changed in the last decade, all 
three clauses should still be referenced: ``(See FAR 52.232-25, 52.232-
26, or 52.232-27, as applicable)''.
    Response:
    Concur. All three Prompt Payment clauses have been added.
    Comment 2: 514.202-5.
    Recommend deleting this section. It merely states the clause in the 
FAR is sufficient. It does not add any value. If the information is 
already in the FAR, no further information needs to be identified in 
the GSAR.
    Response:
    Non-concur; 514.202-5 amplifies the information, or rather points 
the reader to the information in the FAR.
    Comment 3: 514.270-2.
    The new paragraph (a)(4) already exists, verbatim, as part of 
paragraph (a)(3). As the proposed paragraph (a)(4) is related to the 
information in paragraph (a)(3), recommend leaving it in paragraph 
(a)(3), but reformatting the sentence to make it clear it is part of 
(a)(3). In the current GSAR, it has been dropped down a line.
    Response:
    Non-concur. Items (a)(3) and (a)(4) are different enough that they 
can be listed as two different items in the list of series.
    Comment 4: 514.270-3.
    Recommend adding a clause or provision as a consistent method for 
providing the notification required in the solicitation. Revise as, 
``Insert a clause substantially the same as the clause at 552.214-XX, 
Evaluation for Aggregate Award, in solicitations that will include 
aggregate line items for award.''
    Response:
    Non-concur. The team believes that FAR 52.214-22, Evaluation of 
Bids for Multiple Awards, provides equivalent coverage.
    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 revisions are not considered substantive. The 
revisions only update and reorganize existing coverage. This is not a 
significant change. Therefore, a Regulatory Flexibility Analysis was 
not performed. In accordance with 5 U.S.C. 610, the proposed rule 
requested comments from small entities concerning this assessment, and 
no comments were received.

C. Paperwork Reduction Act

    The Paperwork Reduction Act applies; however, these changes to the 
GSAR do not impose additional information collection requirements to 
the paperwork burden previously approved under OMB Control Number 3090-
0027.

List of Subjects in 48 CFR Parts 501, 514, and 552

    Government procurement.

    Dated: August 31, 2009.
David A. Drabkin,
Senior Procurement Executive, Office of Acquisition Policy, General 
Services Administration.

0
Therefore, GSA amends 48 CFR parts 501, 514, and 552 as set forth 
below:
0
1. The authority citation for 48 CFR parts 501, 514, and 552 continues 
to read as follows:

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

PART 501--GENERAL SERVICES ADMINISTRATION ACQUISITION REGULATION 
SYSTEM


501.106  [Amended]

0
2. Amend section 501.106 by adding the GSAR Reference number ``514.201-
1'', in numerical sequence, and its corresponding OMB Control No. 
``3090-0163''.

PART 514--SEALED BIDDING

0
3. Revise section 514.201-2 to read as follows:


514.201-2  Part I--The Schedule.

    (a) When using Standard Form 33, Solicitation, Offer and Award, 
include the following cautionary notice:

[[Page 47739]]

    ``Notice to Bidders--Use Item 13 of the Standard Form 33, 
Solicitation, Offer and Award, to offer prompt payment discounts. The 
Prompt Payment clause of this solicitation sets forth payment terms. Do 
not insert any statement in Item 13 that requires payment sooner than 
the time stipulated in the Prompt Payment clause (See FAR 52.232-25, 
52.232-26, or 52.232-27, as applicable). EXAMPLE: If you insert ``NET 
20'' in Item 13, GSA will reject your bid as nonresponsive because the 
entry contradicts the 30 day payment terms specified in the Prompt 
Payment clause.''
    (b) When using other authorized forms (e.g., Standard Form 1447, 
Solicitation/Contract; Standard Form 1449, Solicitation/Contract/Order 
for Commercial Items), include the notice in paragraph (a) of this 
section. Change the reference to the form number, form title, and item 
number accordingly.

0
4. Revise section 514.201-6 to read as follows:


514.201-6  Solicitation provisions.

    When considering all or none bids, insert the provision at 552.214-
70, ``All or None'' Bids, in the solicitation.

0
5. Revise section 514.201-7 to read as follows:


514.201-7  Contract clauses.

    Stock replenishment contracts. For some stock replenishment 
contracts, individual contractors may be unable to furnish the 
Government's monthly requirements. The contracting officer may 
determine that progressive awards will be more expedient. In such 
cases, insert a clause substantially the same as the clause at 552.214-
71, Progressive Awards and Monthly Quantity Allocations, in the 
solicitation and contract.

0
6. Revise section 514.202-4 to read as follows:


514.202-4  Bid samples.

    (a) Requirements for samples in invitations for bids. (1) When bid 
samples are required, the contracting officer shall require bidders to 
submit samples produced by the manufacturer whose products will be 
supplied under the contract.
    (2) The FAR limits use of bid samples to cases where the 
contracting officer cannot describe some characteristics of a product 
adequately in the specification or purchase description. This usually 
applies to subjective characteristics. The contracting officer may 
determine that there is a need to examine objective characteristics of 
bid samples to determine the responsiveness of a bid. The contracting 
officer should base the determination on past experience or other valid 
considerations. In the solicitation, separately list ``Subjective 
Characteristics'' and ``Objective Characteristics''.
    (3) A provision appears at 552.214-72, Bid Sample Requirements. 
This provision may be modified to fit the circumstances of a 
procurement.
    (b) Handling bid samples. (1) Samples from accepted bids must be 
retained for the period of contract performance. If there are no 
outstanding claims regarding the contract, the contracting officer may 
authorize disposal of the samples at the end of the contract term 
following the bidder's instructions.
    (2) If the contracting officer anticipates a claim regarding the 
contract, the contracting officer shall require that the bid samples be 
retained until the claim is resolved.
    (3) The contracting officer shall require that samples from 
unsuccessful bids be retained until award. After award, these samples 
may be disposed of following the bidder's instructions.

0
7. Add section 514.202-5 to read as follows:


514.202-5  Descriptive literature.

    Requirements for Invitations for bids. When using brand name or 
equal purchase descriptions, the provision at FAR 52.211-6 satisfies 
the requirement for descriptive literature.


514.203  [Removed]

0
8. Remove section 514.203.

0
9. Amend section 514.270-2 by--
0
a. Redesignating paragraphs (a)(4) and (a)(5) as paragraphs (a)(5) and 
(a)(6), respectively, and adding new paragraph (a)(4); and
0
b. Revising the introductory text of paragraph (b), and paragraph (c).
0
The revised and added text reads as follows:


514.270-2  Guidelines for use.

    (a) * * *
    (4) Awarding the low-demand articles in conjunction with the high-
demand articles may encourage competition.
* * * * *
    (b) Before deciding to combine items for aggregate award, the 
contracting officer should consider the following factors:
* * * * *
    (c) The contracting officer should not use an aggregate award if it 
will significantly restrict the number of eligible bidders.

0
10. Revise section 514.270-3 to read as follows:


514.270-3  Evaluation factors for award.

    The solicitation should clearly state the basis for evaluating bids 
for aggregate award, require bidders to submit a price on each item 
within the group or a percentage to be added or subtracted from a list 
price, and advise bidders that failure to submit prices as required 
within a group makes a bid ineligible for award for that group.

0
11. Amend section 514.270-4 by--
0
a. Revising paragraph (a);
0
b. Removing from paragraph (b) ``you group'' and adding ``grouping'' in 
its place;
0
c. Removing from paragraph (d)(2) ``respond'' and adding ``responded'' 
in its place; and
0
d. Removing from paragraph (d)(3)(i) ``you to lose'' and adding ``the 
loss of'' in its place.


514.270-4  Grouping line items for aggregate award.

    (a) Supplies and services. This subsection applies to acquisitions 
of supplies and services.
* * * * *

0
12. Amend section 514.270-6 by--
0
a. Removing from the introductory text of paragraph (a) ``you have'' 
and adding ``there are'' in its place;
0
b. Revising the first sentence in paragraph (d); and
0
c. Removing from paragraph (e) the word ``you''.
0
The revised text reads as follows:


514.270-6  Guidelines for using the weight factors method.

* * * * *
    (d) Estimated quantities may be reduced to smaller numbers by a 
common denominator. * * *
* * * * *

0
13. Amend section 514.270-7 by--
0
a. Revising the first sentence in paragraph (a);
0
b. Revising the introductory text of paragraphs (b) and (c);
0
c. Revising paragraph (d);
0
d. Revising the second sentence of paragraph (e); and
0
e. Revising the third sentence in paragraph (h), and paragraphs (i)(6) 
and (i)(8).
0
The revised text reads as follows:


514.270-7  Guidelines for using the price list method.

    (a) General. The price list method helps avoid unbalanced bidding 
when making aggregate awards, but lack accurate estimates of 
anticipated quantities. * * *
    (b) Solicitation requirements. When using the price list method, in 
the solicitation:
* * * * *

[[Page 47740]]

    (c) Developing list prices. Price lists may be developed using one 
or more of the following sources:
* * * * *
    (d) First time use for an item or service. The first time the 
contracting officer uses list prices for an item or service, give 
prospective bidders an opportunity to review the proposed list. Also 
provide information on how GSA will use the list prices. This 
information may be provided in a draft solicitation.
    (e) * * *. Prices may be used from previous awards made using the 
weight factors method to develop price lists.
* * * * *
    (h) * * *. If the Government's needs cannot be estimated, the 
solicitation may include past orders. * * *
    (i) * * *
    (6) If providing quantity estimates, state that the estimates are 
for information only and do not constitute guarantees or commitments to 
order items under the contract.
* * * * *
    (8) When the solicitation further groups unit prices by trade or 
business category, multiple percentages may be required.
* * * * *

0
14. Revise section 514.407-3 to read as follows:


514.407-3  Other mistakes disclosed before award.

    Delegation of authority by head of the agency. Under FAR 14.407-
3(e), contracting directors (see 502.101) are authorized, without power 
of redelegation, to make:
    (a) The determinations regarding corrections and withdrawals under 
FAR 14.407-3(a), (b), and (c); and
    (b) The corollary determinations not to permit withdrawal or 
correction under FAR 14.407-3(d).

0
15. Revise section 514.407-4 to read as follows:


514.407-4  Mistakes after award.

    The contracting director and assigned counsel are required to 
review and approve the contracting officer's determinations under FAR 
14.407-4(b) and (c).

PART 552--SOLICITATION PROVISIONS AND CONTRACT CLAUSES

0
16. Revise the section heading, date of the provision and paragraphs 
(a) and (b) of section 552.214-70; and remove Alternate I.
0
The revised text reads as follows:


552.214-70  ``All or None'' Bids.

* * * * *
    ``ALL OR NONE'' BIDS (Oct 2009)
    (a) The Government reserves the right to evaluate bids and make 
awards on an ``all or none'' basis as provided below.
    (b) A bid submitted on an ``all or none'' or similar basis will 
be evaluated as follows: The lowest acceptable bid exclusive of the 
``all or none'' bid will be selected with respect to each item (or 
group of items when the solicitation provides for aggregate awards) 
and the total cost of all items thus determined shall be compared 
with the total of the lowest acceptable ``all or none'' bid. Award 
will be made to result in the lowest total cost to the Government.

0
17. Amend section 552.214-71 by revising the date of the clause, 
paragraph (a)(1), the introductory text of paragraph (a)(2), and 
paragraph (b) to read as follows:


552.214-71  Progressive Awards and Monthly Quantity Allocations.

* * * * *
    PROGRESSIVE AWARDS AND MONTHLY QUANTITY ALLOCATIONS (Oct 2009)
    (a) Monthly quantity allocation.
    (1) Set forth below are the Government's estimated annual and 
monthly requirements for each stock item covered by this 
solicitation. Bids shall indicate, in the spaces provided, the 
monthly quantity which the bidder is willing to furnish of any item 
or group of items involving the use of the same production 
facilities. In making monthly allocations, bidders are urged to 
group as many items as possible. Such groupings will make it 
possible for the Government to make fullest use of the production 
capabilities of each bidder.
    (2) Bidders need not limit their monthly allocations to the 
Government's estimated monthly requirements, since additional 
unanticipated needs may occur during the period of the contract. If 
a bid does not include monthly allocation quantities, it will be 
deemed to offer to furnish all of the Government's requirements, 
even though they may exceed the stated estimated requirements.
* * * * *
    (b) Progressive awards. If the low responsive bid's monthly 
quantity allocation is less than the Government's estimated 
requirements, the Government may make progressive awards beginning 
with the low responsive bid and including each next low responsive 
bid to the extent necessary to meet the estimated requirements.
* * * * *

0
18. Amend section 552.214-72 by--
0
a. Revising the date of the provision;
0
b. Revising the ``Note'' in paragraph (b); and
0
c. Adding paragraph (e).
0
The revised and added text reads as follows:


552.214-72  Bid Sample Requirements.

* * * * *
    BID SAMPLE REQUIREMENTS (Oct 2009)
* * * * *
    (b) * * *
    NOTE: Bidders that propose to furnish an item or group of items 
from more than one manufacturer or production point must submit two 
samples from the production of each manufacturer or production 
point.
* * * * *
    (e) Contracting Officer insert address.
    --------------------------------
    --------------------------------
    --------------------------------

[FR Doc. E9-22209 Filed 9-16-09; 8:45 am]
BILLING CODE 6820-61-S