[Federal Register Volume 76, Number 175 (Friday, September 9, 2011)]
[Proposed Rules]
[Pages 55849-55859]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2011-22944]


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DEPARTMENT OF DEFENSE

GENERAL SERVICES ADMINISTRATION

NATIONAL AERONAUTICS AND SPACE ADMINISTRATION

48 CFR Parts 1, 2, 4, 12, 14, 15, 19, 22, 26, 52, and 53

[FAR Case 2009-016; Docket 2011-0090; Sequence 1]
RIN 9000-AM05


Federal Acquisition Regulation; Constitutionality of Federal 
Contracting Programs for Minority-Owned and Other Small Businesses

AGENCY: Department of Defense (DoD), General Services Administration 
(GSA), and National Aeronautics and Space Administration (NASA).

ACTION: Proposed rule.

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SUMMARY: DoD, GSA, and NASA are proposing to amend the Federal 
Acquisition Regulation (FAR) to address the impact of the decision in 
Rothe Development Corporation vs. the DoD and the U.S. Department of 
the Air Force (USAF) on small disadvantaged business concerns and 
certain institutions of higher education.

DATES: Interested parties should submit written comments to the 
Regulatory Secretariat at one of the addresses shown below on or before 
November 8, 2011 to be considered in the formation of the final rule.

ADDRESSES: Submit comments in response to FAR Case 2009-016 by any of 
the following methods:
     Regulations.gov: http://www.regulations.gov. Submit 
comments via the Federal eRulemaking portal by inputting ``FAR Case 
2009-016'' under the heading ``Enter Keyword or ID'' and selecting 
``Search.'' Select the link ``Submit a Comment'' that corresponds with 
``FAR Case 2009-016.'' Follow the instructions provided at the ``Submit 
a Comment'' screen. Please include your name, company name (if any), 
and ``FAR Case 2009-016'' on your attached document.
     Fax: (202) 501-4067.
     Mail: General Services Administration, Regulatory 
Secretariat (MVCB), Attn: Hada Flowers, 1275 First Street, NE., 7th 
Floor, Washington, DC 20417.
    Instructions: Please submit comments only and cite FAR Case 2009-
016, in all correspondence related to this case. All comments received 
will be posted without change to http://www.regulations.gov, including 
any personal and/or business confidential information provided.

FOR FURTHER INFORMATION CONTACT: Mr. Karlos Morgan, Procurement 
Analyst, at (202) 501-2364, for clarification of content. For 
information pertaining to status or publication schedules, contact the 
Regulatory Secretariat at (202) 501-4755. Please cite FAR Case 2009-
016.

SUPPLEMENTARY INFORMATION: 

I. Background

    In November 1998, Rothe Development Corporation (RDC) filed suit 
against DoD and the USAF (Rothe), in the U.S. District Court for the 
Western District of Texas. In its complaint, RDC challenged the 
constitutionality of section 1207 of the National Defense Authorization 
Act of 1987, Public Law 99-661 (10 U.S.C. 2323), alleging that it 
violated the right to equal protection under the Due Process Clause of 
the Fifth Amendment to the United States Constitution. RDC's initial 
complaint against the DoD/USAF focused on the reauthorization of 
section 1207 in 1992. On September 25, 2007, the U.S. District Court 
for the Western District of Texas entered a judgment in favor of DoD. 
However, RDC appealed the court's ruling and on November 4, 2008, the 
U.S. Court of Appeals for the Federal Circuit decided in its favor 
(Rothe Dev. Corp. v. DoD, 545 F.3d 1023 (Fed. Cir. November 4, 2008)). 
The U.S. Court of Appeals for the Federal Circuit found 10 U.S.C. 2323 
unconstitutional. A District court decision mandated by the U.S. Court 
of Appeals was issued on February 27, 2009, enjoining all application 
of 10 U.S.C. 2323 (Rothe Dev. Corp. v. DoD, 606 F. Supp. 2d 648 (W.D. 
Tex. 2009)).
    Section 1207 of the National Defense Authorization Act of 1987, 
Public Law 99-661, codified at 10 U.S.C. 2323, established the DoD, 
NASA, and the U.S. Coast Guard (USCG), Small Disadvantaged Business 
(SDB) Participation Program. The purpose of the program was to ensure 
that SDBs could fully participate in the Federal contracting process. 
Section 1207 provided the authority for DoD, NASA, and USCG contracting 
officers to apply a price adjustment of up to 10 percent to afford SDBs 
a competitive price advantage when competing in a full and open 
competition and assist in achieving a 5 percent SDB goal. Section 1207 
serves as the statutory underpinning for FAR subpart 19.11, Price 
Evaluation Adjustment for Small Disadvantaged Business Concerns, as 
well as some of FAR subpart 19.12, Small Disadvantaged Business 
Participation Program, and certain associated FAR clauses.

A. FAR Revisions

    DOD, GSA, and NASA are proposing to amend the FAR to remove 
coverage at FAR subpart 19.11, FAR subpart 19.12, corresponding clauses 
at FAR 52.219-22, Small Disadvantaged Business Status, FAR 52.219-23, 
Notice of Price Evaluation Adjustment for Small Disadvantaged Business 
Concerns, FAR 52.219-24, Small Disadvantaged Business Participation 
Program--Targets, FAR 52.219-25, Small Disadvantaged Business 
Participation Program--Disadvantaged Status and Reporting, and FAR 
52.219-26, Small Disadvantaged Business Participation Program--
Incentive Subcontracting, and to remove references to FAR subpart 
19.11, 19.12, and corresponding clauses in FAR parts 1, 2, 4, 12, 14, 
15, 19, 22, 26, 52, and 53.
    Certain authorities in FAR subpart 19.12 and supporting clauses 
addressing the award of subcontracts to SDBs that are rooted in the 
Small Business Act, rather than in section 1207, were not at issue in 
the Rothe decision, and therefore retain their legal status. These 
include the authority to (1) provide monetary incentives to prime 
contractors to encourage subcontracting opportunities to SDBs and (2) 
use an evaluation factor or subfactor to evaluate the participation of 
small businesses as subcontractors. Because these authorities are not 
affected by the Rothe decision, the coverage in FAR subpart 19.12 
addressing subcontracting (with the exception of the coverage at FAR 
19.1202 on the use of factors or subfactors to evaluate SDB subcontract 
participation) has been retained but moved to FAR subpart 19.7, which 
already addresses subcontracting issues generally, including the use of 
monetary incentives to encourage subcontracting opportunities. As a 
result, this realignment consolidates coverage on subcontracting with 
small business programs in one place.
    With respect to FAR 19.1202, Evaluation factor or subfactor, FAR 
subpart 19.7 is currently silent on its use. Nothing in this rulemaking 
precludes an agency from using evaluation factors and subfactors for 
subcontracting during source selections. The Small Business 
Administration's

[[Page 55850]]

(SBA) regulations (13 CFR 125.3(g)) allow the application of evaluation 
factors and subfactors to subcontracting with any of the small business 
programs, including, but not limited to, SDBs. The Federal Acquisition 
Regulatory Council will confer with SBA to evaluate the need for 
guidance in the FAR on the use of evaluation factors and subfactors for 
subcontracting.

B. Standard Form (SF) 294, Subcontracting Report for Individual 
Contracts

    DOD, GSA, and NASA are proposing to revise the SF 294, 
Subcontracting Report for Individual Contracts to remove references to 
DOD and the USCG collecting subcontract award data for Historically 
Black Colleges and Universities (HBCUs) and Minority Instructions 
(MIs). In addition, conforming changes are made to reflect that the 
threshold for contractors to submit small business subcontracting plans 
was increased from $550,000 to $650,000 (from $1.0 million to $1.5 
million for construction).

II. Executive Orders 12866 and 13563

    Executive Orders (E.O.s) 13563 and 12866 direct agencies to assess 
all costs and benefits of available regulatory alternatives and, if 
regulation is necessary, to select regulatory approaches that maximize 
net benefits (including potential economic, environmental, public 
health and safety effects, distributive impacts, and equity). E.O. 
13563 emphasizes the importance of quantifying both costs and benefits, 
of reducing costs, of harmonizing rules, and of promoting flexibility. 
This is a significant regulatory action and, therefore, was 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.

III. Regulatory Flexibility Act

    This change may 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 DOD, GSA, and NASA are 
proposing to implement changes in the FAR necessitated by the impact of 
the decision in Rothe. The court in Rothe found 10 U.S.C. 2323 
unconstitutional, thus impacting some SDBs. This rule proposes to 
delete FAR subpart 19.11, Price Evaluation Adjustment for Small 
Disadvantaged Business Concerns, FAR subpart 19.12, Small Disadvantaged 
Business Participation Program, and associated clauses and references, 
and reincorporate certain provisions of FAR subpart 19.12 addressing 
SDB subcontracting in FAR subpart 19.7. This proposed rule may impact 
small entities because the removal of FAR subpart 19.11, Price 
Evaluation Adjustment for Small Disadvantaged Business Concerns and FAR 
subpart 19.12, Small Disadvantaged Business Participation Program may 
have an effect on SDBs seeking awards as prime contractors.
    Under this proposed revision to the FAR, Federal agencies will no 
longer be authorized to apply certain procurement mechanisms (FAR 
subparts 19.11 and 19.12) that had offered a benefit for SDB prime 
awards. As a practical matter, however, because the price evaluation 
adjustment at issue in Rothe had not been used for approximately a 
decade before that decision, this change will not alter the status quo 
for SDBs. In addition, the Small Business Act (15 U.S.C. 644(g)(1)) 
establishes a 5 percent SDB governmentwide contracting goal at the 
prime and subcontract levels. Further, prime contractors may continue 
to receive a benefit in solicitations that utilize factors or 
subfactors during source selection for small businesses and small 
disadvantaged businesses, as well as monetary incentives as part of the 
incentive subcontracting program (FAR 52.219-10).
    An Initial Regulatory Flexibility Analysis (IRFA) has been 
prepared. The analysis is summarized as follows:

    1. Description of the reasons why action by the agency is being 
considered.
    This proposed rule implements changes in the FAR necessitated by 
the impact of the decision in Rothe Development Corporation vs. the 
U.S. Department of Defense and the U.S. Department of the Air Force 
(545 F. 3rd 1023 (Fed. Cir. November 4, 2008)).
    2. Succinct statement of the objectives of, and legal basis for, 
the proposed rule.
    The Court found 10 U.S.C. 2323 unconstitutional, thus impacting 
SDBs and certain institutions of higher education (i.e., HBCUs/MIs). 
As a result of the Rothe decision, DOD, GSA, and NASA propose to 
revise the FAR to delete FAR subpart 19.11, Price Evaluation 
Adjustment for Small Disadvantaged Business Concerns, for DoD, NASA, 
and USCG. FAR subpart 19.12, Small Disadvantaged Business 
Participation Program, is revised to remove considerations 
associated with the evaluation factors and subfactors of SDB 
concerns with the expiration of section 7102 of the Federal 
Acquisition Streamlining Act (FASA) and the Rothe decision. Clauses 
associated with FAR subparts 19.11 and 19.12 are either deleted or 
revised.
    3. Description of, and where feasible, estimated of the number 
of small entities to which the rule will apply.
    There are approximately 24,702 SDBs currently listed in the 
Central Contractor Registration.
    4. Description of projected reporting, recordkeeping, and other 
compliance requirements of the proposed rule, including an estimate 
of the classes of small entities which will be subject to the 
requirement and the type of professional skills necessary for 
preparation of the report or record.
    The rule will impose no new reporting or record keeping 
requirements on small entities. This proposed rule may impact small 
entities because the removal of FAR subpart 19.11, Price Evaluation 
Adjustment for Small Disadvantaged Business Concerns and FAR subpart 
19.12, Small Disadvantaged Business Participation Program may have 
an effect on SDBs seeking awards as prime contractors.
    Under this proposed revision to the FAR, Federal agencies will 
no longer be authorized to apply certain procurement mechanisms (FAR 
subparts 19.11 and 19.12) that had offered a benefit for SDB prime 
awards. As a practical matter, however, because the price evaluation 
adjustment at issue in Rothe had not been used for approximately a 
decade before that decision, this change will not alter the status 
quo for SDBs. In addition, the Small Business Act (15 U.S.C. 
644(g)(1)) establishes a 5 percent SDB government-wide contracting 
goal at the prime and subcontract levels. Further, prime contractors 
may continue to receive a benefit in solicitations that utilize 
factors or subfactors during source selection for small businesses 
and small disadvantaged businesses, as well as monetary incentives 
as part of the incentive subcontracting program (FAR 52.219-10).
    5. Identification, to the extent practicable, of all relevant 
Federal rules which may duplicate, overlap, or conflict with the 
proposed rule.
    The rule does not duplicate, overlap, or conflict with any other 
Federal rules.
    6. Description of any significant alternatives to the proposed 
rule which accomplish the stated objectives of applicable statutes 
and which minimize any significant economic impact of the proposed 
rule on small entities.
    DOD, GSA, and NASA did not identify any significant alternatives 
that would accomplish the objectives of the statute of publishing 
this proposed rule.

    The Regulatory Secretariat will be submitting a copy of the IRFA to 
the Chief Counsel for Advocacy of the Small Business Administration. A 
copy of the IRFA may be obtained from the Regulatory Secretariat. DoD, 
GSA, and NASA invite comments from small business concerns and other 
interested parties on the expected impact of this rule on small 
entities.
    DoD, GSA, and NASA will also consider comments from small entities 
concerning the existing regulations in subparts affected by this rule 
in accordance with 5 U.S.C. 610. Interested parties must submit such 
comments separately and should cite 5 U.S.C. 610

[[Page 55851]]

(FAR Case 2009-016) in correspondence.

IV. Paperwork Reduction Act

    The proposed rule does not contain any information collection 
requirements that require the approval of the Office of Management and 
Budget (OMB) under the Paperwork Reduction Act (44 U.S.C. chapter 35).
    DOD, GSA, and NASA are proposing to remove FAR coverage at FAR 
subpart 19.11, FAR subpart 19.12, and corresponding clauses at FAR 
52.219-22, Small Disadvantaged Business Status, FAR 52.219-23, Notice 
of Price Evaluation Adjustment for Small Disadvantaged Business 
Concerns, FAR 52.219-24, Small Disadvantaged Business Participation 
Program--Targets, FAR 52.219-25, Small Disadvantaged Business 
Participation Program--Disadvantaged Status and Reporting, and FAR 
52.219-26, Small Disadvantaged Business Participation Program--
Incentive Subcontracting. With these changes, the information 
collection associated with FAR subpart 19.12, FAR 52.219-22, FAR 
52.219-23, and FAR 52.219-25 for OMB Control number 9000-0150 will be 
removed, reducing the information collection burden imposed by the 
Federal Government on the public by 15,000 burden hours.

List of Subjects in 48 CFR Parts 1, 2, 4, 12, 14, 15, 19, 22, 26, 
52, and 53

    Government procurement.

    Dated: September 1, 2011.
Laura Auletta,
Acting Director, Office of Governmentwide Acquisition Policy, Office of 
Acquisition Policy.
    Therefore, DoD, GSA, and NASA propose amending 48 CFR parts 1, 2, 
4, 12, 14, 15, 19, 22, 26, 52, and 53 as set forth below:
    1. The authority citation for 48 CFR parts 1, 2, 4, 12, 14, 15, 19, 
22, 26, 52, and 53 continues to read as follows:

    Authority: 40 U.S.C. 121(c); 10 U.S.C. chapter 137; and 42 
U.S.C. 2473(c).

PART 1--FEDERAL ACQUISITION REGULATIONS SYSTEM


1.106  [Amended]

    2. Amend section 1.106, in the table following the introductory 
text, by removing FAR segments ``19.12,'' ``52.219-22,'' ``52.219-23,'' 
and ``52.219-25,'' and their corresponding OMB Control Numbers ``9000-
0150.''

PART 2--DEFINITIONS OF WORDS AND TERMS

    3. Amend section 2.101 in paragraph (b)(2) in the definition 
``Small disadvantaged business concern'' to read as follows:


2.101  Definitions.

* * * * *
    (b) * * *
    (2) * * *
    Small disadvantaged business concern consistent with 13 CFR 
124.1002, means an offeror, that is a small business under the size 
standard applicable to the acquisition; and--
    (1) Not less than 51 percent of which is unconditionally and 
directly owned by one or more socially and economically disadvantaged 
individuals who are citizens of the United States, the management and 
daily business operations of which are controlled by one or more 
socially and economically disadvantaged individuals;
    (2) Where the concern is owned by one or more disadvantaged 
individuals, each individual represents that their net worth does not 
exceed $750,000 after taking into account the applicable exclusions set 
forth at 13 CFR 124.104(c)(2); and
    (3) If it represents in writing that it qualifies as a small 
disadvantaged business (SDB) for any Federal subcontracting program, it 
believes in good faith that it is owned and controlled by one or more 
socially and economically disadvantaged individuals and meets the SDB 
eligibility criteria of 13 CFR 124.1002.
* * * * *

PART 4--ADMINISTRATIVE MATTERS


4.1202  [Amended]

    4. Amend section 4.1202 by removing paragraph (k); and 
redesignating paragraphs (l) through (bb) as paragraphs (k) through 
(aa), respectively.

PART 12--ACQUISITION OF COMMERCIAL ITEMS

    5. Amend section 12.301 by revising paragraph (b)(2) to read as 
follows:


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

* * * * *
    (b) * * *
    (2) The provision at 52.212-3, Offeror Representations and 
Certifications--Commercial Items. This provision provides a single, 
consolidated list of representations and certifications for the 
acquisition of commercial items and is attached to the solicitation for 
offerors to complete. This provision may not be tailored except in 
accordance with subpart 1.4. Use the provision with its Alternate I in 
solicitations issued by DoD, NASA, or the Coast Guard.
* * * * *
    6. Amend section 12.303 by revising paragraph (b)(1) to read as 
follows:


12.303  Contract format.

* * * * *
    (b) * * *
    (1) Block 10 if an incentive subcontracting clause is used (the 
contracting officer shall indicate the applicable percentage);
* * * * *

PART 14--SEALED BIDDING


14.502  [Amended]

    7. Amend section 14.502 by removing paragraph (b)(4); and 
redesignating paragraphs (b)(5) through (b)(8) as paragraphs (b)(4) 
through (b)(7), respectively.

PART 15--CONTRACTING BY NEGOTIATION


15.304  [Amended]

    8. Amend section 15.304 by removing paragraph (c)(4); and 
redesignating paragraphs (c)(5) and (c)(6) as paragraphs (c)(4) and 
(c)(5), respectively.
    9. Amend section 15.305 by revising paragraph (a)(2)(v); and 
removing from paragraph (a)(5) ``15.304(c)(3)(ii) and (c)(5)'' and 
adding ``15.304(c)(3)(ii) and (c)(4)'' in its place.
    The revision reads as follows:


15.305  Proposal evaluation.

    (a) * * *
    (2) * * *
    (v) The evaluation should include the past performance of offerors 
in complying with subcontracting plan goals for small disadvantaged 
business (SDB) concerns (see subpart 19.7).
* * * * *
    10. Amend section 15.503 by--
    a. Revising the introductory text of paragraph (a)(2)(i);
    b. Removing paragraph (a)(2)(i)(B); and
    c. Redesignating paragraphs (a)(2)(i)(C) through (a)(2)(i)(E) as 
paragraphs (a)(2)(i)(B) through (a)(2)(i)(D).
    The revision reads as follows:


15.503  Notifications to unsuccessful offerors.

    (a) * * *
    (2) * * *
    (i) In addition to the notice in paragraph (a)(1) of this section, 
the contracting officer shall notify each offeror in writing prior to 
award and

[[Page 55852]]

upon completion of negotiations and determinations of responsibility--
* * * * *

PART 19--SMALL BUSINESS PROGRAMS

    11. Amend section 19.000 by--
    a. Revising the introductory text of paragraph (a);
    b. Removing paragraphs (a)(8) through (a)(10); and
    c. Redesignating paragraphs (a)(11) and (a)(12) as paragraphs 
(a)(9) and (a)(10), respectively.
    The revision reads as follows:


19.000  Scope of part.

    (a) This part implements the acquisition-related sections of the 
Small Business Act (15 U.S.C. 631, et seq.), applicable sections of the 
Armed Services Procurement Act (10 U.S.C. 2302, et seq.), the Federal 
Property and Administrative Services Act (41 U.S.C. 252), and Executive 
Order 12138, May 18, 1979. It covers--
* * * * *


19.201  [Amended]

    12. Amend section 19.201 by--
    a. Removing paragraph (b);
    b. Redesignating paragraphs (c) through (e) as paragraphs (b) 
through (d), respectively; and
    c. Removing paragraph (f).


19.202-6  [Amended]

    13. Amend section 19.202-6 by removing paragraph (a)(3); and 
redesignating paragraphs (a)(4) through (a)(6) as paragraphs (a)(3) 
through (a)(5), respectively.
    14. Revise section 19.304 to read as follows:


19.304  Disadvantaged business status.

    The contracting officer may accept an offeror's representation that 
it is an SDB concern. The provision at 52.219-1, Small Business Program 
Representations, or 52.212-3(c)(4), Offeror Representations and 
Certifications--Commercial Items, is used to collect SDB data.
    15. Revise section 19.305 to read as follows:


19.305  Protests and reviews of disadvantaged business status.

    (a) This section applies to protests and reviews of a small 
business concern's disadvantaged status as a prime contractor or 
subcontractor. An SBA review of a firm's small disadvantaged business 
(SDB) status differs from a formal protest at 19.703.
    (1) A representation of SDB status on a Federal prime contract will 
be deemed a misrepresentation of SDB status if the firm does not meet 
the requirements of 13 CFR 124.1001(b).
    (2) Any person or entity that misrepresents a firm's status as a 
``small business concern owned and controlled by socially and 
economically disadvantaged individuals'' (``SDB status'') in order to 
obtain an 8(d) (15 U.S.C. 637(d)) contracting opportunity will be 
subject to the penalties imposed by section 16(d) of the Small Business 
Act, 15 U.S.C. 645(d), as well as any other penalty authorized by law.
    (3) SBA may initiate the review of SDB status on any firm that has 
represented itself to be an SDB on a subcontract to a Federal prime 
contract whenever it receives credible information calling into 
question the SDB status of the firm.
    (b) Requests for an SBA review of SDB status may be forwarded to 
the Small Business Administration, Assistant Administrator for SDBCE, 
409 Third Street, SW, Washington, DC 20416.
    (c) Protests of a small business concern's disadvantaged status as 
a subcontractor are processed under 19.703(a)(2). Protests of a 
concern's size as a prime contractor are processed under 19.302. 
Protests of a concern's size as a subcontractor are processed under 
19.703(b).


19.309  [Amended]

    16. Amend section 19.309 by removing paragraph (b); and 
redesignating paragraphs (c) and (d) as paragraphs (b) and (c), 
respectively.
    17. Amend section 19.703 by revising paragraph (a)(2) to read as 
follows:


19.703  Eligibility requirements for participating in the program.

    (a) * * *
    (2) In connection with a subcontract, the contracting officer or 
the SBA may protest the disadvantaged status of a proposed 
subcontractor. Such protests will be processed in accordance with 13 
CFR 124.1007 through 124.1014. Other interested parties may submit 
information to the contracting officer or the SBA in an effort to 
persuade the contracting officer or the SBA to initiate a protest. Such 
protests, in order to be considered timely, must be submitted to the 
SBA prior to completion of performance by the intended subcontractor.
* * * * *


19.705-1  [Amended]

    18. Amend section 19.705-1 by removing the second sentence.


19.708  [Amended]

    19. Amend section 19.708 in paragraphs (c)(1), (c)(2), and (c)(3) 
by removing ``business, HUBZone small business, and'' and adding 
``business, HUBZone small business, small disadvantaged business, and'' 
in its place.

Subpart 19.11--[Removed and Reserved]

    20a. Remove and reserve subpart 19.11, consisting of sections 
19.1101 through 19.1104.

Subpart 19.12--[Removed and Reserved]

    20b. Remove and reserve subpart 19.12, consisting of sections 
19.1201 through 19.1204.
    21. Amend section 19.1307 by revising paragraph (d) to read as 
follows:


19.1307  Price evaluation preference for HUBZone small business 
concerns.

* * * * *
    (d) A concern that is a HUBZone small business concern shall 
receive the benefit of the HUBZone small business price evaluation 
preference. The applicable price evaluation preference shall be 
calculated independently against an offeror's base offer. The 
individual preference shall be added to the base offer to arrive at the 
total evaluated price for that offer.
* * * * *

PART 22--APPLICATION OF LABOR LAWS TO GOVERNMENT ACQUISITIONS


22.1006  [Amended]

    22. Amend section 22.1006 by--
    a. Removing from paragraph (a)(2)(i)(C) ``52.204-8(c)(2)(iii) or 
(iv)'' and adding ``52.204-8(c)(2)(ii) or (iii)'' in its place;
    b. Removing from paragraph (e)(2)(i) ``52.204-8(c)(2)(iii)'' and 
adding ``52.204-8(c)(2)(ii)'' in its place; and
    c. Removing from paragraph (e)(4)(i) ``52.204-8(c)(2)(iv)'' and 
adding ``52.204-8(c)(2)(iii)'' in its place.

PART 26--OTHER SOCIOECONOMIC PROGRAMS


26.304  [Amended]

    23. Amend section 26.304 by removing the last sentence.

PART 52--SOLICITATION PROVISIONS AND CONTRACT CLAUSES

    24. Amend section 52.204-8 by--
    a. Revising the date of the provision;
    b. Revising paragraph (c)(1)(xxi);
    c. Removing paragraph (c)(2)(i); and
    d. Redesignating paragraphs (c)(2)(ii) through (c)(2)(vii) as 
(c)(2)(i) through (c)(2)(vi), respectively.

[[Page 55853]]

    The revised text reads as follows:


52.204-8  Annual Representations and Certifications.

* * * * *

Annual Representations and Certifications (Date)

* * * * *
    (c) * * *
    (1) * * *
    (xxi) 52.226-2, Historically Black College or University and 
Minority Institution Representation. This provision applies to 
solicitations for research, studies, supplies, or services of the 
type normally acquired from higher educational institutions.
* * * * *

    25. Amend section 52.212-3 by--
    a. Revising the date of the provision;
    b. Removing paragraph (c)(10);
    c. Redesignating paragraph (c)(11) as paragraph (c)(10);
    d. Removing from the newly redesignated paragraph (c)(10)(ii) 
``representation in paragraph (c)(11)(i)'' and adding ``representation 
in paragraph (c)(10)(i)'' in its place;
    e. Revising Alternate I; and
    f. Removing Alternate II.
    The revised text reads as follows:


52.212-3  Offeror Representations and Certifications--Commercial Items.

* * * * *

Offeror Representations and Certifications--Commercial Items (Date)

* * * * *
    Alternate I (Date). As prescribed in 12.301(b)(2), add the 
following paragraph (c)(11) to the basic provision:
    (11) (Complete if the offeror has represented itself as 
disadvantaged in paragraph (c)(4) of this provision.)
* * * * *

    26. Amend section 52.212-5 by--
    a. Revising the date of the clause;
    b. Removing paragraphs (b)(17), (b)(18), and (b)(19); and
    c. Redesignating paragraphs (b)(20) through (b)(49) as paragraphs 
(b)(17) through (b)(46), respectively.


52.212-5  Contract Terms and Conditions Required To Implement Statutes 
or Executive Orders--Commercial Items.

* * * * *

Contract Terms and Conditions Required To Implement Statutes or 
Executive Orders--Commercial Items (Date)

* * * * *
    27. Amend section 52.219-1 by revising the date of the provision; 
and adding in paragraph (c), in alphabetical order, the definition 
``Small disadvantaged business concern.''


52.219-1  Small Business Program Representations.

* * * * *

Small Business Program Representations (Date)

* * * * *
    Small disadvantaged business concern means a small business 
concern--
    Not less than 51 percent of which is unconditionally and 
directly owned by one or more socially and economically 
disadvantaged individuals who are citizens of the United States, the 
management and daily business operations of which are controlled by 
one or more socially and economically disadvantaged individuals (as 
defined at 13 CFR subpart B, 124.1002).
* * * * *

    28. Amend section 52.219-2 by revising the introductory paragraph 
to read as follows:


52.219-2  Equal Low Bids.

    As prescribed in 19.309(b), insert the following provision:
* * * * *
    29. Amend section 52.219-4 by revising the date of the clause, and 
paragraph (b)(3) to read as follows:


52.219-4  Notice of Price Evaluation Preference for HUBZone Small 
Business Concerns.

* * * * *

Notice of Price Evaluation Preference for HUBZone Small Business 
Concerns (Date)

* * * * *
    (b) * * *
    (3) A concern that is a HUBZone small business concern will 
receive the benefit of the HUBZone small business price evaluation 
preference. The applicable price evaluation preference shall be 
calculated independently against an offeror's base offer. The 
individual preference amounts shall be added together to arrive at 
the total evaluated price for that offer.
* * * * *

    30. Amend section 52.219-8 by revising the date of the clause, and 
in paragraph (c), revising the definition ``Small disadvantaged 
business concern'' to read as follows:


52.219-8  Utilization of Small Business Concerns.

* * * * *

Utilization of Small Business Concerns (Date)

* * * * *
    (c) * * *
    Small disadvantaged business concern means a small business 
concern that represents, as part of its offer that it meets the 
criteria--
    (1) Consistent with 13 CFR subpart B, 124.1002, and means a 
small business concern--
    (i) Not less than 51 percent of which is unconditionally and 
directly owned by one or more socially and economically 
disadvantaged individuals who are citizens of the United States, the 
management and daily business operations of which are controlled by 
one or more socially and economically disadvantaged individuals; and
    (ii) Where the concern is owned by one or more disadvantaged 
individuals, each individual represents that their net worth does 
not exceed $750,000 after taking into account the applicable 
exclusions set forth at 13 CFR 124.104(c)(2); or
    (2) It represents in writing that it qualifies as a small 
disadvantaged business (SDB) for any Federal subcontracting program, 
and believes in good faith that it is owned and controlled by one or 
more socially and economically disadvantaged individuals and meets 
the SDB eligibility criteria of 13 CFR 124.1002.
* * * * *

    31. Amend section 52.219-10 by revising the date of the clause; 
and removing from paragraph (b) ``business, HUBZone small business, 
and'' and adding ``business, HUBZone small business, small 
disadvantaged business, and'' in its place. The revised text reads 
as follows:


52.219-10  Incentive Subcontracting Program.

* * * * *

Incentive Subcontracting Program (Date)

* * * * *


52.219-22, 52.219-23, 52.219-24, 52.219-25, and 52.219-26  [Removed and 
Reserved]

    32. Remove and reserve sections 52.219-22, 52.219-23, 52.219-24, 
52.219-25, and 52.219-26.
    33. Amend section 52.219-28 by revising the introductory paragraph 
to read as follows:


52.219-28  Post-Award Small Business Program Rerepresentation.

    As prescribed in 19.309(c), insert the following clause:
* * * * *
    34. Amend section 52.226-2 by revising the date of the provision, 
and in paragraph (a) by revising the definition ``Historically black 
college or university'' to read as follows:


52.226-2  Historically Black College or University and Minority 
Institution Representation.

* * * * *

Historically Black College or University and Minority Institution 
Representation (Date)

    (a) * * *
    Historically black college or university means an institution 
determined by the Secretary of Education to meet the requirements of 
34 CFR 608.2 and includes any nonprofit research institution that 
was an

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integral part of such a college or university before November 14, 
1986.
* * * * *

PART 53--FORMS

    35. Revise section 53.219 to read as follows:


53.219  Small business programs.

    The following standard form is prescribed for use in reporting 
small business (including Alaska Native Corporations and Indian 
tribes), veteran-owned small business, service-disabled veteran-owned 
small business, HUBZone small business, small disadvantaged business 
(including Alaska Native Corporations and Indian tribes), and women-
owned small business subcontracting data, as specified in part 19: SF 
294, (Rev. (Date)) Subcontracting Report for Individual Contracts. SF 
294 is authorized for local reproduction.
    36. Amend section 53.301-294 by revising the form to read as 
follows:


53.301-294  Subcontracting Report for Individual Contracts.

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[FR Doc. 2011-22944 Filed 9-8-11; 8:45 am]
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