[Federal Register Volume 81, Number 118 (Monday, June 20, 2016)]
[Proposed Rules]
[Pages 39883-39886]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2016-14412]


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DEPARTMENT OF DEFENSE

GENERAL SERVICES ADMINISTRATION

NATIONAL AERONAUTICS AND SPACE ADMINISTRATION

48 CFR Parts 8 and 13

[FAR Case 2015-015; Docket No. 2015-0015; Sequence No. 1]
RIN 9000-AM89


Federal Acquisition Regulation: Strategic Sourcing Documentation

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 implement a section of the Carl Levin 
and Howard P. ``Buck'' McKeon National Defense Authorization Act for 
Fiscal Year 2015 that provides that the contract file shall contain 
certain documentation if the Federal Government makes a purchase of 
supplies and services offered under the Federal Strategic Sourcing 
Initiative (FSSI), but the FSSI is not used.

DATES: Interested parties should submit comments to the Regulatory 
Secretariat Division at one of the addresses shown below on or before 
August 19, 2016 to be considered in the formulation of a final rule.

ADDRESSES: Submit comments in response to FAR case 2015-015 by any of 
the following methods:
     Regulations.gov: http://www.regulations.gov.

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    Submit comments via the Federal eRulemaking portal by searching for 
``FAR Case 2015-015''.'' Select the link ``Comment Now'' that 
corresponds with ``FAR Case 2015-015.'' Follow the instructions 
provided on the screen. Please include your name, company name (if 
any), and ``FAR Case 2015-015'' on your attached document(s).
     Mail: General Services Administration, Regulatory 
Secretariat Division, ATTN: Ms. Flowers, 1800 F Street NW., 2nd floor, 
Washington, DC 20405.
    Instructions: Please submit comments only and cite ``FAR case 2015-
015'' in all correspondence related to this case. Comments received 
will generally be posted without change to http://www.regulations.gov, 
including any personal and/or business confidential information 
provided. To confirm receipt of your comment, please check 
www.regulations.gov, approximately two to three business days after 
submission to verify posting (except allow 30 days for posting of 
comments submitted by mail.)

FOR FURTHER INFORMATION CONTACT: For clarification of content, contact 
Mr. Michael O. Jackson, Procurement Analyst, at 202-208-4949. For 
information pertaining to status or publication schedules, contact the 
Regulatory Secretariat Division at 202-501-4755. Please cite ``FAR Case 
2015-015.''

SUPPLEMENTARY INFORMATION: 

I. Background

    Section 836 of the Carl Levin and Howard P. ``Buck'' McKeon 
National Defense Authorization Act for Fiscal Year 2015 (NDAA) (Pub. L. 
113-291) was enacted on December 19, 2014. This provision is part of 
subtitle D, Federal Information Technology Acquisition Reform, of title 
VIII of the NDAA. It established that when the Federal Government makes 
a purchase of supplies or services offered under the Federal Strategic 
Sourcing Initiative (FSSI), but the FSSI is not used, the contract file 
for the purchase shall include a brief analysis of the comparative 
value, including price and nonprice factors, between the supplies and 
services offered under the FSSI and those offered under the source(s) 
to be used for the purchase. The goals and benefits of the FSSI Program 
as taken directly from the FSSI strategic sourcing Web site 
(www.strategicsourcing.gov) are--
    Strategic sourcing is the structured and collaborative process of 
critically analyzing an organization's spending patterns to better 
leverage its purchasing power, reduce costs, and improve overall 
performance. The primary goals of FSSI are to--
     Strategically source across federal agencies;
     Establish mechanisms to increase total cost savings, 
value, and socioeconomic participation;
     Collaborate with industry to develop optimal solutions;
     Share best practices; and
     Create a strategic sourcing community of practice.
    Strategic Sourcing drives both dollar savings and process 
improvements. The Federal Government, suppliers and ultimately the U.S. 
taxpayers benefit when government can better articulate its 
requirements and provide committed purchase volumes, and in return, 
industry suppliers can provide better pricing and more valuable 
solutions. Specific benefits of Strategic Sourcing include--
     Meet OMB's goal for cross-government participation;
     Assist with socioeconomic goals;
     Collect and analyze data;
     Identify trends;
     Re-engineer high cost business processes;
     Replicate cost-saving business processes;
     Share lessons learned and best practices;
     Realize cost efficiencies;
     Streamline procurement process; and
     Drive additional discounts.
    By ensuring consideration of strategically sourced vehicles, the 
proposed documentation requirement will raise the visibility of these 
solutions, promote their use, and help to better leverage the 
Government's buying power.
    This proposed rule complements other efforts and strategies being 
developed under the Category Management Initiative, which builds on the 
success of strategic sourcing by managing entire categories of common 
purchases across the Government and utilizing teams of experts to 
manage those specific categories to drive down total cost and improve 
performance. See Transforming the Federal Marketplace: Simplifying 
Federal Procurement to Drive Performance, Drive Innovation, and 
Increase Savings (December 4, 2014) available at https://www.whitehouse.gov/sites/default/files/omb/procurement/memo/simplifying-federal-procurement-to-improve-performance-drive-innovation-increase-savings.pdf.

II. Proposed FAR Changes

    The purpose of the proposed FAR changes is to update FAR 8.004 to 
add the requirements established by section 836. Additionally, FAR 
13.301 is updated to clarify that for micro-purchases made using the 
governmentwide purchase card, purchase card holders shall follow the 
documentation requirements in Appendix B of OMB Circular A-123 
(available at https://www.whitehouse.gov/sites/default/files/omb/assets/omb/circulars/a123/a123_appendix_b.pdf), which prescribes 
management guidance on the use of purchase cards.
    This new FAR rulemaking requires contracting officers when 
purchasing supplies or services that are offered under the FSSI, but 
the FSSI is not used, to document the contract file to include a brief 
analysis of the comparative value, including price and nonprice 
factors, between the supplies and services offered under the FSSI and 
those offered under the source(s) to be used for the purchase.

III. Applicability to Contracts for Amounts not Greater Than the 
Simplified Acquisition Threshold (SAT), Commercial Items, and 
Commercially Available Off-the-Shelf (COTS) Items

    41 U.S.C. 1905 governs the applicability of laws to contracts or 
subcontracts in amounts not greater than the SAT. 41 U.S.C. 1906 
requires that the FAR include a list of provisions of law that are 
inapplicable to the acquisition of commercial items (other than the 
acquisition of commercially available off-the-shelf (COTS) items). 41 
U.S.C. 1907 requires that the FAR include a list of provisions of law 
that are inapplicable to the acquisition of COTS items. It is 
anticipated that at the time of the final rule the FAR Council will 
approve these determinations.

IV. 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 a significant regulatory action and, therefore, was subject to 
Office of Information and Regulatory Affairs (OIRA) review under 
Section 6(b) of E.O. 12866, Regulatory Planning and Review, dated 
September

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30, 1993. This proposed rule is not a major rule under 5 U.S.C. 804.

V. Regulatory Flexibility Act

    DoD, GSA, and NASA do not expect this proposed 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 proposed rule only affects the internal operating 
procedures of the Government.
    However, an Initial Regulatory Flexibility Analysis (IRFA) was 
performed and is summarized as follows:

    This rule implements section 836 of the Carl Levin and Howard P. 
``Buck'' McKeon National Defense Authorization Act for Fiscal Year 
2015, which provides that the contract file shall contain certain 
documentation if the Federal Government makes a purchase of supplies 
and services offered under the Federal Strategic Sourcing Initiative 
(FSSI), but the FSSI is not used.
    The goal of the rule is to have contracting officers consider 
use of the GSA Federal Strategic Sourcing Initiative (FSSI) when 
purchasing items that are available through FSSI.
    According to the Federal Procurement Data System, in Fiscal Year 
2014, the Federal Government made approximately 170,403 contract 
awards (not including modifications and orders), of which 
approximately 85,624 (50.25 percent) were awarded to about 43,545 
unique small business entities. The rule requires action by 
contracting officers when purchasing items available through FSSI 
and will not directly affect any small entities. It specifically 
requires the contracting officer to place certain documentation in 
the contract file if the Federal Government makes a purchase of 
supplies and services offered under the Federal Strategic Sourcing 
Initiative (FSSI), but the FSSI is not used. The rule could 
indirectly affect small businesses that offer supplies or services 
under the FSSI as the rule will require contracting officers to 
consider FSSI vendors when they may not have done so in the past, 
and this could lead to more sales for those small businesses. There 
are currently 137 entities awarded under the FSSI, of which 78 (57 
percent) are small entities. The required consideration of FSSI 
offerings does not directly have a negative effect on entities not 
awarded an FSSI contract, but the required contracting officer 
consideration and documentation requirement could indirectly lead to 
more purchases going to those vendors involved in the FSSI.
    An explicit goal of Federal strategic sourcing is to maintain 
and/or enhance socio-economic goals. Partnering with small 
businesses during key stages of the strategic sourcing process will 
enable the FSSI to meet or exceed socio-economic goals. As part of 
the FSSI process, current spending with small business is baselined 
for each initiative to gain an understanding of how much is being 
spent. Then sourcing strategies are developed that expand the 
business done with targeted groups against that baseline, quantify 
the expected changes, and compare this with actual results as 
required by OMB guidance on strategic sourcing. Each participating 
agency will continue to be responsible for achieving its socio-
economic goals and will need to evaluate the impact of FSSI sourcing 
recommendations.
    There is no reporting required by Government contractors, all 
action on the rule is internal to the Government.
    The rule does not duplicate, overlap, or conflict with any other 
Federal rules.
    No viable alternatives were determined at this rulemaking stage.

    The Regulatory Secretariat Division 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 Division. 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 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 2015-015), 
in correspondence.

VI. Paperwork Reduction Act

    The proposed 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 Subjects in 48 CFR Parts 8 and 13

    Government procurement.

    Dated: June 14, 2016.
William F. 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 parts 8 and 13 
as set forth below:

0
1. The authority citation for 48 CFR parts 8 and 13 continues to read 
as follows:

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

PART 8--REQUIRED SOURCES OF SUPPLIES AND SERVICES

0
2. Amend section 8.004 by--
0
a. Redesignating paragraphs (a)(1) and (2) as paragraphs (a)(1)(i) and 
(ii), respectively;
0
b. Redesignating the introductory paragraph as paragraph (a)(1);
0
c. Removing from the newly designated paragraph (a)(1) ``paragraph 
(a)'' and ``paragraph (b)'' and adding ``paragraph (a)(1)'' and 
``paragraph (a)(2)'' in their places, respectively;
0
d. Removing from the newly redesignated paragraph (a)(1)(ii) 
``paragraph (a)(1)'' and adding ``paragraph (a)(1)(i)'' in its place;
0
e. Redesignating paragraph (b) as paragraph (a)(2); and
0
f. Adding new paragraph (b).
    The addition reads as follows:


8.004   Use of other sources.

* * * * *
    (b) Documentation requirements relating to the Federal Strategic 
Sourcing Initiative (FSSI). When purchasing supplies or services that 
are offered under the FSSI, but the FSSI is not used, the contract file 
shall be documented to include a brief analysis of the comparative 
value, including price and nonprice factors, between the supplies and 
services offered under the FSSI and those offered under the source(s) 
to be used for the purchase (section 836 of Pub. L. 113-291).

PART 13--SIMPLIFIED ACQUISITION PROCEDURES

0
3. Amend section 13.301 by revising paragraph (b) to read as follows:


13.301   Governmentwide commercial purchase card.

* * * * *
    (b)(1) Agencies using the Governmentwide commercial purchase card 
shall establish procedures for use and control of the card that comply 
with the Treasury Financial Manual for Guidance of Departments and 
Agencies (TFM 4-4500) (available at http://tfm.fiscal.treasury.gov/v1/p4/c450.html, the Office of Management and Budget's Circular A-123, 
Appendix B (available at https://www.whitehouse.gov/sites/default/files/omb/assets/omb/circulars/a123/a123_appendix_b.pdf), and that are 
consistent with the terms and conditions of the current GSA credit card 
contract.
    (2) Agency procedures should not limit the use of the 
Governmentwide commercial purchase card to micro-purchases. Agency 
procedures should encourage use of the card in greater dollar amounts 
by contracting officers to place orders and to pay for purchases 
against contracts established under part 8 procedures, when authorized; 
and to place orders and/or make payment under other contractual 
instruments, when agreed to by the contractor. See 32.1110(d) for 
instructions for use of the appropriate clause when payment under

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a written contract will be made through use of the card.
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[FR Doc. 2016-14412 Filed 6-17-16; 8:45 am]
 BILLING CODE 6820-EP-P