[Federal Register Volume 79, Number 249 (Tuesday, December 30, 2014)]
[Proposed Rules]
[Pages 78378-78379]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2014-30417]





48 CFR Part 6

[FAR Case 2014-020; Docket No. 2014-0020; Sequence No. 1]
RIN 9000-AM86

Federal Acquisition Regulation; Clarification on Justification 
for Urgent Noncompetitive Awards Exceeding One Year

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

ACTION: Proposed rule.


SUMMARY: DoD, GSA, and NASA are proposing to amend the Federal 
Acquisition Regulation (FAR) to clarify that a determination of 
exceptional circumstances is needed when a noncompetitive contract 
awarded on the basis of unusual and compelling urgency exceeds one 
year, either at time of award or due to post-award modifications.

DATES: Interested parties should submit written comments to the 
Regulatory Secretariat at one of the addresses shown below on or before 
March 2, 2015 to be considered in the formation of the final rule.

ADDRESSES: Submit comments in response to FAR Case 2014-020 by any of 
the following methods:
     Regulations.gov: http://www.regulations.gov. Submit 
comments via the Federal eRulemaking portal by searching for ``FAR Case 
2014-020''. Select the link ``Comment Now'' that corresponds with ``FAR 
Case 2014-020''. Follow the instructions provided at the ``Comment 
Now'' screen. Please include your name, company name (if any), and 
``FAR Case 2014-020'' on your attached document.
     Fax: 202-501-4067.
     Mail: General Services Administration, Regulatory 
Secretariat (MVCB), ATTN: Ms. Flowers, 1800 F Street NW., 2nd Floor, 
Washington, DC 20405.
    Instructions: Please submit comments only and cite FAR Case 2014-
020, 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. Michael O. Jackson, Procurement 
Analyst, at 202-208-4949, for clarification of content. For information 
pertaining to status or publication schedules, contact the Regulatory 
Secretariat at 202-501-4755. Please cite FAR Case 2014-020.


I. Background

    DoD, GSA, and NASA are revising the FAR in response to a Government 
Accountability Office (GAO) report, GAO-14-304, Federal Contracting: 
Noncompetitive Contracts Based on Urgency Need Additional Oversight, 
dated March 2014. On October 14, 2009, the FAR was amended to implement 
section 862 of the Duncan Hunter National Defense Authorization Act 
(NDAA) for Fiscal Year (FY) 2009 (Pub. L. 110-417) which restricted the 
length of contracts awarded noncompetitively under unusual and 
compelling urgency circumstances. Such contracts may not exceed one 
year unless the head of the executive agency determines that 
exceptional circumstances apply.
    GAO found that agencies did not make the required determination for 
the ten contracts in GAO's sample that had a period of performance of 
more than one year. As a result, GAO recommended that DoD, U.S. 
Department of State and U.S. Agency for International Development 
provide guidance to improve data reliability and oversight for 
contracts awarded using the urgency exception.
    Additionally, GAO recommended that the Director of the Office of 
Management and Budget, through the Office of Federal Procurement 
Policy, provide guidance to clarify when determinations of exceptional 
circumstances are needed when a noncompetitive contract awarded on the 
basis of unusual and compelling urgency exceeds one year, either at the 
time of award or because it was modified after contract award.
    This rule clarifies that a determination of exceptional 
circumstances is needed whenever the period of performance of a 
noncompetitive contract awarded on the basis of unusual and compelling 
urgency is extended beyond a year.

[[Page 78379]]

II. Executive Orders 12866 and 13563

    Executive Orders (E.O.s) 12866 and 13563 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 not a significant regulatory action and, therefore, was not 
subject to review under section 6(b) of E.O. 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

    DoD, GSA, and NASA do not expect this 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 it only clarifies when determination of exceptional 
circumstances is needed. However, an Initial Regulatory Flexibility 
Analysis (IRFA) has been performed and is summarized as follows:

    The purpose of this rule is to clarify that a determination of 
exceptional circumstances is needed when the period of performance, 
inclusive of options and modifications, of a noncompetitive contract 
awarded on the basis of unusual and compelling urgency is greater 
than one year. This rule only impacts the internal procedures of the 
Federal government.
    There are no recordkeeping, reporting, or other compliance 
requirements associated with the proposed rule. The rule does not 
duplicate, overlap, or conflict with any other Federal rules.

    The Regulatory Secretariat has submitted 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 
    DoD, GSA, and NASA will also consider comments from small entities 
concerning the existing regulations in subparts affected by the rule in 
accordance with 5 U.S.C. 610. Interested parties must submit such 
comments separately and should cite 5 U.S.C. 610 (FAR Case 2014-020), 
in correspondence.

IV. Paperwork Reduction Act

    The rule does not contain any information collection requirements 
that require the approval of the Office of Management and Budget under 
the Paperwork Reduction Act (44 U.S.C. chapter 35).

List of Subject in 48 CFR Part 6

    Government procurement.

    Dated: December 22, 2014.
William Clark,
Director, Office of Government-wide Acquisition Policy, Office of 
Acquisition Policy, Office of Government-wide Policy.

    Therefore, DoD, GSA, and NASA propose amending 48 CFR part 6 as set 
forth below:


1. The authority citation for 48 CFR part 6 continues to read as 

    Authority: 40 U.S.C. 121(c); 10 U.S.C. chapter 137; and 51 
U.S.C. 20113.

2. Amend section 6.302-2 by--
a. Revising paragraph (d)(1)(ii);
b. Redesignating paragraphs (d)(2) through (d)(4) as paragraphs (d)(3) 
through (d)(5), respectively;
c. Adding a new paragraph (d)(2); and
d. Revising newly redesignated paragraph (d)(3).
    The revised and added text reads as follows:

6.302-2  Unusual and compelling urgency.

* * * * *
    (d) * * *
    (1) * * *
    (ii) May not exceed one year, including all options, unless the 
head of the agency entering into the contract determines that 
exceptional circumstances apply. This determination must be documented 
in the contract file.
    (2)(i) A separate determination shall be made when executing any 
modification or option that extends the period of performance beyond 
one year. This requirement does not apply to the exercise of options 
previously addressed in the determination required at (d)(1)(ii) of 
this section. Any subsequent extension requires a new determination.
    (ii) The determination shall be approved at the same level as the 
level to which the agency head authority in (d)(1)(ii) of this section 
is delegated.
    (3) The requirements in paragraphs (d)(1) and (d)(2) of this 
section shall apply to any contract in an amount greater than the 
simplified acquisition threshold.
* * * * *
[FR Doc. 2014-30417 Filed 12-29-14; 8:45 am]