[Federal Register Volume 81, Number 175 (Friday, September 9, 2016)]
[Proposed Rules]
[Pages 62434-62445]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2016-21629]



[[Page 62434]]

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GENERAL SERVICES ADMINISTRATION

48 CFR Parts 501, 511, 517, 532, 536, 543, 546, and 552

[GSAR Case 2015-G503; Docket No. 2016-0015; Sequence No. 1]
RIN 3090-AJ63


General Services Administration Acquisition Regulation (GSAR); 
Construction Contract Administration

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

ACTION: Proposed rule.

-----------------------------------------------------------------------

SUMMARY: The General Services Administration (GSA) is issuing a 
proposed rule amending the General Services Administration Acquisition 
Regulation (GSAR) coverage on construction contracts, including 
provisions and clauses for solicitations and resultant contracts, to 
clarify, update, and incorporate existing construction contract 
administration procedures.

DATES: Interested parties should submit written comments to the 
Regulatory Secretariat Division on or before November 8, 2016 to be 
considered in the formulation of a final rule.

ADDRESSES: Submit comments identified by GSAR case 2015-G503 by any of 
the following methods:
     Regulations.gov: http://www.regulations.gov. Submit 
comments via the Federal eRulemaking portal by inputting ``GSAR Case 
2015-G503'' under the heading ``Comment or Submission''. Select the 
link ``Comment Now'' that corresponds with GSAR Case 2015-G503. Follow 
the instructions provided on the screen. Please include your name, 
company name (if any), and ``GSAR Case 2015-G503'' on all attached 
document(s).
     Mail: General Services Administration, Regulatory 
Secretariat Division, 1800 F Street NW., ATTN: Ms. Flowers, Washington, 
DC 20405.
    Instructions: Please submit comments only and cite GSAR Case 2015-
G503 in all correspondence related to this case. All 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(s), please check 
www.regulations.gov, approximately two to three days after submission 
to verify posting (except allow 30 days for posting of comments 
submitted by mail).

FOR FURTHER INFORMATION CONTACT: For clarification about content, 
contact Ms. Christina Mullins, General Services Acquisition Policy 
Division, GSA, by phone at 202-969-4066 or by email at 
[email protected]. For information pertaining to status or 
publication schedules, contact the Regulatory Secretariat Division by 
mail at 1800 F Street NW., Washington, DC 20405, or by phone at 202-
501-4755. Please cite the GSAR Case 2015-G503, Construction Contract 
Administration.

SUPPLEMENTARY INFORMATION: 

I. Background

    The General Services Administration (GSA) is amending the General 
Services Administration Acquisition Regulation (GSAR) to revise 
sections of GSAR part 536, Construction and Architect-Engineer 
Contracts, and related parts, to maintain consistency with the Federal 
Acquisition Regulation (FAR) and to clarify, update and incorporate 
existing construction contract administration guidance previously 
implemented through internal Public Building Service (PBS) policies.
    The proposed rule changes fall into five categories: (1) 
Incorporating existing agency policy previously issued through other 
means, (2) reorganizing to better align with the FAR, (3) incorporating 
agency unique clauses, (4) incorporating supplemental material, and (5) 
editing for clarity. Bringing existing policy into the GSAR will allow 
for greater transparency and an opportunity for the public to comment 
on these longstanding procedures. The proposed rule includes a total of 
five new agency unique provisions and clauses, six new supplemental 
clauses, and revision and reorganization of eight existing provisions 
and clauses.
    A GSAR rewrite initiative was undertaken by GSA to revise the GSAR 
starting in 2008. A proposed rule to update GSAR part 536, Construction 
and Architect-Engineer Contracts was initially published as GSAR Case 
2008-G509 in the Federal Register at 73 FR 73199 on December 2, 2008. 
Due to the variety of issues addressed in the GSAR 536 rewrite, and 
internal stakeholder interest, the agency re-evaluated the 
implementation plan for the GSAR 536 rewrite and withdrew this initial 
proposed rule. The initial proposed rule withdrawal was published in 
the Federal Register at 80 FR 6944, on February 9, 2015. GSAR Case 
2015-G503 is the second of several new GSAR cases to separately address 
the issues and update the GSAR 536 text.

II. Discussion and Analysis

    The changes to the GSAR included in the proposed rule are 
summarized in this section.
    1. Eight new clauses for construction contracts previously issued 
through other means are incorporated into GSAR parts 211, 232, and 236. 
The new clauses and a brief description are as follows:

------------------------------------------------------------------------
        Name and No.              Requirements          Prescription
------------------------------------------------------------------------
552.211-10 Commencement,      Supplemental clause   Same prescription as
 Prosecution, and Completion   to FAR 52.211-10 to   FAR clause.
 of Work.                      address notice to
                               proceed,
                               substantial
                               completion, and
                               phased work.
552.211-12 Liquidated         Supplemental clause   Same prescription as
 Damages--Construction.        to FAR 52.211-12 to   FAR clause.
                               address substantial
                               completion and
                               phased work.
552.211-13 Time Extensions..  Supplemental clause   Same prescription as
                               to FAR 52.211-13 to   FAR clause.
                               address the project
                               schedule as a
                               baseline.
552.211-70 Substantial        Agency unique clause  Prescription
 Completion.                   to define the term    consistent with
                               and address related   that for FAR 52.211-
                               requirements.         10.
552.232-5 Payments under      Supplemental clause   Same prescription as
 Fixed-Price Construction      to FAR 52.232-5 to    FAR clause.
 Contracts.                    address pre-invoice
                               payment meetings
                               and clarify
                               certification
                               documentation
                               required for
                               payment.
552.236-6 Superintendence by  Supplemental clause   Clause prescription
 the Contractor.               to FAR 52.236-6 to    has no dollar
                               address project       threshold, which is
                               management            more inclusive than
                               resources and         the FAR clause that
                               responsibilities.     is only required at
                                                     above simplified,
                                                     in order to satisfy
                                                     GSA specific
                                                     contracting
                                                     requirements.

[[Page 62435]]

 
552.236-15 Schedules for      Supplemental clause   Clause prescription
 Construction Contracts.       to FAR 52.236-15 to   has no dollar
                               address milestone     threshold, which is
                               events, cost          more inclusive than
                               breakdown, and        the FAR clause that
                               requirements for      is only required at
                               different project     above simplified,
                               delivery methods.     in order to satisfy
                                                     GSA specific
                                                     contracting
                                                     requirements.
                                                    The base clause
                                                     provides guidance
                                                     for any type of
                                                     construction
                                                     project. Alternate
                                                     I of the clause
                                                     provides guidance
                                                     specific to a
                                                     design-bid-build
                                                     construction
                                                     project. Alternate
                                                     II of the clause
                                                     provide guidance
                                                     specific to a
                                                     design-build
                                                     construction
                                                     project.
                                                    A third alternate is
                                                     contemplated for a
                                                     construction-
                                                     manager-as-
                                                     constructor project
                                                     delivery method and
                                                     may appear in a
                                                     separate case to
                                                     update the GSAR 536
                                                     text.
552.236-71 Contractor         Agency unique clause  The base clause
 Responsibilities.             to address            provides guidance
                               requirements for      for any type of
                               different project     construction
                               delivery methods.     project. Alternate
                                                     I of the clause
                                                     provides guidance
                                                     specific to a
                                                     design-build
                                                     construction
                                                     project.
                                                    A second alternate
                                                     is contemplated for
                                                     a construction-
                                                     manager-as-
                                                     constructor project
                                                     delivery method and
                                                     may appear in a
                                                     separate case to
                                                     update the GSAR 536
                                                     text.
------------------------------------------------------------------------

    2. Seven existing clauses for construction contracts in GSAR parts 
236 and 243 are revised and reorganized to better align with the FAR 
and to streamline the GSAR. The clauses and a brief description of the 
changes are as follows:

------------------------------------------------------------------------
        Name and No.              Requirements          Prescription
------------------------------------------------------------------------
552.236-11 Use and            Supplemental          Clause prescription
 Possession Prior to           language to address   revised for general
 Completion.                   unfinished work.      construction.
                              Replaces previous      Clause prescription
                               GSAR 552.236-81,      also has no dollar
                               Use of Equipment by   threshold, which is
                               the Government, and   more inclusive than
                               is now better         the FAR clause that
                               aligned with the      is only required at
                               FAR.                  above simplified,
                                                     in order to satisfy
                                                     GSA specific
                                                     contracting
                                                     requirements.
552.236-21 Specifications     Supplemental          Clause prescription
 and Drawings for              language to address   has no dollar
 Construction.                 inconsistencies,      threshold, which is
                               and clarify           more inclusive than
                               definition of terms   the FAR clause that
                               for different         is only required at
                               project delivery      above simplified,
                               methods.              in order to satisfy
                                                     GSA specific
                                                     contracting
                                                     requirements.
                              Revised title and     The base clause
                               clause numbering to   provides guidance
                               better align with     for any type of
                               the FAR, previously   construction
                               was GSAR 552.236-     project. Alternate
                               77, Specifications    I of the clause
                               and Drawings.         provides guidance
                                                     specific to a
                                                     design-build
                                                     construction
                                                     project.
                                                    A second alternate
                                                     is contemplated for
                                                     a construction-
                                                     manager-as-
                                                     constructor project
                                                     delivery method and
                                                     may appear in a
                                                     separate case to
                                                     update the GSAR 536
                                                     text.
552.236-70 (Existing)         Clause deleted as it  Clause deleted as it
 Definitions.                  is not necessary.     is not necessary.
552.236-70 (Revised)          Clause renumbered to  Clause prescription
 Authorities and Limitations.  streamline GSAM       revised to include
                               part 536.             simplified
                               Previously was GSAR   acquisitions in
                               552.236-71,           order to be more
                               Authorities and       consistent with
                               Limitations.          current contracting
                                                     practices.
                              Revised text to
                               address non-
                               compliance.
552.236-72 Submittals.......  Revised title and     Clause prescription
                               clause numbering to   revised to include
                               better align the      simplified
                               content and to        acquisitions in
                               streamline GSAR       order to be more
                               part 536.             consistent with
                               Previously was GSAR   current contracting
                               552.236-78, Shop      practices.
                               Drawings,
                               Coordination
                               Drawings, and
                               Schedules.
                              Revised to provide a
                               broader definition
                               of the term and to
                               address response
                               times, notice to
                               proceed, and
                               deviations.
552.236-73 Subcontracts.....  Clause renumbered to  Clause prescription
                               streamline GSAR       revised to include
                               part 536.             simplified
                               Previously was GSAR   acquisitions in
                               552.236-82,           order to be more
                               Subcontracts.         consistent with
                                                     current contracting
                                                     practices.
552.243-71 Equitable          Clause text remains   Prescription for
 Adjustments.                  unchanged.            this existing
                                                     agency unique
                                                     clause is revised
                                                     to include the
                                                     changes clause for
                                                     simplified
                                                     acquisitions and
                                                     the differing site
                                                     conditions clause.
------------------------------------------------------------------------


[[Page 62436]]

    3. GSAR section 536.270 is added to provide agency regulations for 
options in construction contracts, as required by FAR part 17.2, 
Options. GSAR subpart 517.2 is revised to move all construction 
contract option requirements to GSAR section 536.270. In addition, 
procedures from the existing GSAR section 536.213 for construction 
options are incorporated into GSAR section 536.270 and are revised to 
better align with the FAR and to provide general application to both 
negotiated procurements and sealed bidding. Bringing these instructions 
into one area ensures consistency and provides better guidance to 
contracting officers when developing construction solicitations and 
contracts. As a result, one revised and three new provisions and 
clauses are incorporated into GSAR section 552.236. The provisions and 
clauses and a brief description are as follows:

------------------------------------------------------------------------
        Name and No.              Requirements          Prescription
------------------------------------------------------------------------
552.236-74 Evaluation of      Agency unique         Prescription written
 Options.                      provision for         in plain language
                               construction          for ease of
                               options.              understanding.
552.236-75 Evaluation         Agency unique         Prescription written
 Exclusive of Options.         provision for         in plain language
                               construction          for ease of
                               options.              understanding.
552.236-76 Basis of Award-    Revised title and     Provision
 Sealed Bidding Construction.  provision numbering   prescription
                               to better align the   revised to provide
                               content. Previously   clarity.
                               was GSAR 552.236-
                               73, Basis of Award-
                               Construction
                               Contracts.
552.236-77 Government's       Agency unique clause  Prescription written
 Right to Exercise Options.    for construction      in plain language
                               options.              for ease of
                                                     understanding.
------------------------------------------------------------------------

    4. GSAR section 546.704 is added to provide agency approval for use 
of FAR clause 52.246-21, Warranty of Construction.

III. Executive Orders 12866 and 13563

    Executive Order (E.O.) 12866 of September 30, 1993, Regulatory 
Planning and Review, directs 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). Section 6(b) of the E.O. requires 
the OMB Office of Information and Regulatory Affairs (OIRA) to review 
regulatory actions that have been identified as significant regulatory 
actions by the promulgating agency or OIRA. This proposed rule has not 
been determined to be a significant regulatory action and was therefore 
not subject to OIRA review. However, this rule is not a ``major rule,'' 
as defined by 5 U.S.C. 804.
    E.O. 13563 of January 18, 2011, Improving Regulation and Regulatory 
Review, supplements and reaffirms the principles of E.O. 12866 of 
September 30, 1993. Section 1(c) of E.O. 13563 directs agencies to 
``use the best available techniques to quantify anticipated present and 
future benefits and costs as accurately as possible.'' Accordingly, GSA 
offers the following summary of the costs and benefits associated with 
this proposed rule.

Construction Contract Administration Costs

    The total costs associated with this rule are $895 thousand per 
year for contractors and $224 thousand per year for the Federal 
Government. These costs are attributable to GSA contracts for 
construction, dismantling, demolition, or removal of improvements. The 
estimated costs for contractors affected by this rule are limited to 
the time needed to comply with clause requirements as follows:
    GSA construction contracts will be subject to GSAR clause 552.236-
72, Submittals. This clause provides guidance to contractors regarding 
preparation, submission and resubmission of required contract submittal 
documents such as shop drawings, coordination drawings, and schedules. 
Compliance costs include the time needed to research and identify the 
required information, perform quality assurance checks, and transmit 
the documents. However, contractors will not necessarily have to 
acquire information technology tools or hire additional personnel to 
comply as these have been longstanding procedures in use in GSA 
construction contracts and contractors are familiar with and are 
currently complying with these practices. In addition, the clause is 
simplified, including removing the requirement for a specific number of 
prints and copies of various submittals. GSA estimates the costs for 
vendors holding these contracts to be around $895 thousand per year.
    There are no other costs associated with this rule as no additional 
burden is imposed for other clause requirements.

Construction Contract Administration Benefits

    This rule will save taxpayer dollars because it provides 
clarification on and consolidation of existing requirements for 
construction contracts that will allow for more consistency and 
efficiency in contracting for both businesses and contracting officers.
    Much of the content in GSAR part 536 has not been updated since the 
1980s, and does not reflect current contracting practices. For example, 
sealed bidding as detailed in GSAR 536.213 is rarely used now. This 
rule provides several updates to clarify procedures relevant to today's 
construction administration practices. This will in turn provide 
greater consistency across contracts and lower administrative costs for 
contractors.
    In addition, GSAR coverage does not currently include internal 
policy and guidance issued in other forms such as Procurement 
Instructional Bulletins (PIBs) and Procurement Informational Letters 
(PILs). This rule brings these longstanding practices into the GSAR, 
consolidating policy into one area. As a result, contractors can expend 
less time and fewer resources to read, reconcile, and understand all 
the regulations relevant to their contract in order to fully comply 
with the requirements.

IV. Regulatory Flexibility Act

    GSA does 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, at 5 U.S.C. 601, et seq., 
because the proposed rule will incorporate clauses that are currently 
in use in GSA construction solicitations and contracts and contractors 
are familiar with and are currently complying with these practices. 
However, since this is the first time these existing policies and 
procedures that impact the public are being published, an Initial 
Regulatory Flexibility Analysis (IRFA) has been prepared. The IRFA has 
been prepared

[[Page 62437]]

consistent with the criteria of 5 U.S.C. 604 and is summarized as 
follows:

    The proposed rule changes will apply to approximately 3,900 GSA 
construction contracts. Of these, approximately 3,500 (90 percent) 
construction contracts are held by small businesses. The proposed 
rule is unlikely to affect small businesses awarded GSA construction 
contracts as it implements clauses currently in use in construction 
solicitations and contracts. The proposed rule does not pose any new 
reporting, recordkeeping or other compliance requirements. The rule 
does not duplicate, overlap, or conflict with any other Federal 
rules. The agency determined that supplemental language is necessary 
for eight FAR clauses. No alternatives were determined that will 
accomplish the objectives of the rule. Bringing these regulations 
into the GSAR provides for transparency and allows for public 
comment. Bringing these regulations into the GSAR also consolidates 
policy into one area, allowing for more consistency and efficiency 
in contracting for both businesses and contracting officers.

    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. GSA invites comments from small business concerns 
and other interested parties on the expected impact of this proposed 
rule on small entities.
    GSA will also consider comments from small entities concerning the 
existing regulations in subparts affected by this proposed rule in 
accordance with 5 U.S.C. 610. Interested parties must submit such 
comments separately and should cite 5 U.S.C. 601, et seq., (GSAR 2015-
G503), in correspondence.

V. Paperwork Reduction Act

    The Paperwork Reduction Act (44 U.S.C. chapter 35) applies because 
the proposed rule contains information collection requirements. 
However, no additional burden is imposed on the public for most 
clauses, and there is some burden reduction.
    One clause involves an existing information collection requirement 
that has never been previously recognized or vetted for public comment. 
Accordingly, the Regulatory Secretariat Division has submitted a 
request for approval of the existing information collection 
requirements to the Office of Management and Budget under 44 U.S.C. 
3501, et seq.
    The information collected is used by PBS to evaluate a contractor's 
proposals, negotiate contract modifications, review required 
submittals, evaluate a contractor's progress, and review payment 
requests during contract administration.
    The impacts to the public for the following clauses are as follows:
    The new clause at GSAR 552.211-13, Time Extensions, requires the 
contractor to submit a written request detailing an analysis to justify 
a time extension. However, the clause does not add burden to what is 
already estimated by a previous information collection for FAR clause 
52.243-4, Changes (see OMB Control Number 9000-0026).
    The new clause at GSAR 552.211-70, Substantial Completion, requires 
the contractor to submit a written notice of proposed substantial 
completion date for the construction work. However, the clause does not 
add burden to what is already estimated by a previous information 
collection for FAR clause 52.236-15, Schedules for Construction 
Contracts (see OMB Control Number 9000-0058).
    The new clause at GSAR 552.232-5, Payments under Fixed-Price 
Construction Contracts, requires the contractor to use certain GSA 
forms to submit the information necessary for a complete payment 
request. However, the clause does not add burden to what is already 
estimated by previous information collections for GSAR 532.905-70, FAR 
clause 52.232-5, Payments under Fixed-Price Construction Contracts, and 
FAR clause 52.232-27, Prompt Payment for Construction Contracts (see 
OMB Control Numbers 3090-0080, 9000-0070, and 9000-0102).
    The new clause at GSAR 552.236-15, Schedules for Construction 
Contracts, requires the contractor to identify a schedule of values, to 
provide updates specifically weekly or monthly, and to follow a 
critical path method in some cases. However, the clause does not add 
burden to what is already estimated by a previous information 
collection for FAR clause 52.236-15, Schedules (see OMB Control Number 
9000-0058).
    The new clause at 552.236-72, Submittals, represents a reduction in 
burden. The clause was previously GSAR 552.236-78, Shop Drawings, 
Coordination Drawings, and Schedules. The clause is simplified, 
including removing the requirement for a specific number of prints and 
copies of various submittals such as shop drawings, coordination 
drawings, and schedules. This simplification will ease the compliance 
burden for the contractor during contract administration. However, an 
information collection was never previously filed for this clause.
    Public reporting burden for this collection of information is 
estimated to average 8 hours per response, including the time for 
reviewing instructions, searching existing data sources, gathering and 
maintaining the data needed, and completing and reviewing the 
collection of information.
    The annual reporting burden is estimated as follows:
    Respondents: 3,758.
    Responses per respondent: 1.
    Total annual responses: 3.758.
    Preparation hours per response: 8.
    Total response burden hours: 30,064.
    The new provision at GSAR 552.236-76, Basis of Award-Sealed Bidding 
Construction, removes the use of alternates in sealed bidding. The 
provision was previously GSAR 552.236-73, Basis of Award-Construction 
Contracts. The provision title and prescription are revised to provide 
clarity, and the provision regulations are simplified. This provision 
change will reduce the complexity to businesses during contract 
solicitation as bid sheet line items will be more clearly understood 
for pricing.

VI. Request for Comments Regarding Paperwork Burden

    Submit comments, including suggestions for reducing this burden, 
not later than November 8, 2016 to: GSAR Desk Officer, OMB, Room 10102, 
NEOB, Washington, DC 20503, and a copy to the General Services 
Administration, Regulatory Secretariat Division (MVCB), 1800 F Street 
NW., Washington, DC 20405.
    Public comments are particularly invited on: Whether this 
collection of information is necessary for the proper performance of 
functions of the FAR, and will have practical utility; whether our 
estimate of the public burden of this collection of information is 
accurate, and based on valid assumptions and methodology; ways to 
enhance the quality, utility, and clarity of the information to be 
collected; and ways in which we can minimize the burden of the 
collection of information on those who are to respond, through the use 
of appropriate technological collection techniques or other forms of 
information technology.
    Requesters may obtain a copy of the justification from the General 
Services Administration, Regulatory Secretariat Division (MVCB), 
Washington, DC 20405, telephone 202-501-4755. Please cite OMB Control 
Number 3090-00XX, Construction Contract Administration, in all 
correspondence.

List of Subjects in 48 CFR Parts 501, 511, 517, 532, 536, 543, 546, 
and 552.

    Government procurement.


[[Page 62438]]


    Dated: September 9, 2016.
Jeffrey A. Koses,
Senior Procurement Executive, Office of Acquisition Policy, Office of 
Government-wide Policy.

PART 501--GENERAL SERVICES ADMINISTRATION ACQUISITION REGULATION 
SYSTEM

    Therefore, GSA proposes to amend 48 CFR parts 501, 511, 517, 532, 
536, 543, 546, and 552 as set forth below:

0
1. The authority citation for 48 CFR part 501 continues to read as 
follows:

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


501.106  [Amended]

0
2. Amend section 501.106 in the table by--
0
a. Removing GSAR reference ``532.111(c)'' and its corresponding OMB 
control number ``3090-0080'';
0
b. Removing from GSAR Reference ``532.905-70'' OMB control number 
``9000-0102'' and adding ``3090-0080'' in its place;
0
c. Removing GSAR Reference ``532.905-71'' and its corresponding OMB 
control number ``3090-0080'';
0
d. Adding, in numerical sequence, GSAR references ``552.211-13(a)'' and 
``552.211-70(b)'' and their corresponding OMB control numbers ``9000-
0026'' and ``9000-0058'', respectively;
0
e. Adding, in numerical sequence, GSAR reference ``552.232-5'' and its 
corresponding OMB control numbers ``3090-0080'', ``9000-0070'', and 
``9000-0102''; and
0
f. Adding, in numerical sequence, GSAR references ``552.236-15'' and 
``552.236-72'' and their corresponding OMB control numbers ``9000-
0058'' and ``3090-XXXX'', respectively.

PART 511--DESCRIBING AGENCY NEEDS

0
3. The authority citation for 48 CFR part 511 continues to read as 
follows:

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

0
4. Revise section 511.404 to read as follows:


511.404   Contract clauses.

    (a) Supplies or services--(1) Shelf-life items. The contracting 
officer shall use the following clauses in solicitations and contracts 
that require delivery of shelf-life items within a specified number of 
months from the date of manufacture or production:
    (i) The contracting officer shall insert 552.211-79, Acceptable Age 
of Supplies, if the required shelf-life period is 12 months or less, 
and lengthy acceptance testing may be involved. For items having a 
limited shelf-life, substitute Alternate I when required by the program 
director.
    (ii) The contracting officer shall insert 552.211-80, Age on 
Delivery, if the required shelf-life period is more than 12 months, or 
when source inspection can be performed within a short time period.
    (2) Stock replenishment contracts. The contracting officer shall 
insert 552.211-81, Time of Shipment, in solicitations and stock 
replenishment contracts that do not include the Availability for 
Inspection, Testing, and Shipment/Delivery clause at 552.211-83 and 
require shipment within 45 calendar days after receipt of the order. If 
shipment is required in more than 45 days, the contracting officer 
shall use Alternate I.
    (3) Indeterminate testing time. The contracting officer shall 
insert 552.211-83, Availability for Inspection, Testing, and Shipment/
Delivery, in solicitations and contracts that provide for source 
inspection by Government personnel and that require lengthy testing for 
which time frames cannot be determined in advance. If the contract is 
for stock items, the contracting officer shall use Alternate I.
    (4) The contracting officer shall insert the clause at 552.211-94, 
Time of Delivery, in solicitations and contracts for supplies for the 
Stock Program when neither of the FAR delivery clauses (FAR 52.211-8 or 
52.211-9) is suitable.
    (b) Construction. (1) The contracting officer shall insert the 
clause at 552.211-10, Commencement, Prosecution, and Completion of 
Work, in solicitations and contracts when a fixed-price construction 
contract is contemplated.
    (2) The contracting officer shall insert the clause at 552.211-70, 
Substantial Completion in solicitations and contracts when a fixed-
price construction contract is contemplated.
0
5. Add subpart 511.5, consisting of section 511.504, to read as 
follows:

Subpart 511.5--Liquidated Damages


511.504  Contract clauses.

    (a) The contracting officer shall insert the clause at 552.211-12, 
Liquidated Damages-Construction, in solicitations and contracts for 
construction, other than cost-plus-fixed-fee, when the contracting 
officer determines that liquidated damages are appropriate (see FAR 
11.501(a)).
    (b) The contracting officer shall insert the clause at 552.211-13, 
Time Extensions, in solicitations and contracts for construction that 
use the clause at 552.211-12, Liquidated Damages--Construction.

PART 517--SPECIAL CONTRACTING METHODS

0
6. The authority citation for 48 CFR part 517 is revised to read as 
follows:

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

0
7. Revise section 517.200 to read as follows:


517.200  Scope of subpart.

    (a) Except as provided in paragraph (b) of this section, this 
subpart applies to contracts for supplies and services, including 
architect-engineer services.
    (b) Policies and procedures for the use of options in solicitation 
provisions and contract clauses for services involving construction, 
alteration, or repair (including dredging, excavating, and painting) of 
buildings, bridges, roads, or other kinds of real property are 
prescribed in 536.270. FAR subpart 17.2 and this subpart 517.2 do not 
apply to the use of options in solicitation provisions and contract 
clauses for services involving construction, alteration, or repair 
(including dredging, excavating, and painting) of buildings, bridges, 
roads, or other kinds of real property.
0
8. Revise section 517.202 to read as follows:


517.202  Use of options.

    (a) Options may be used when they meet one or more of the following 
objectives:
    (1) Reduce procurement lead time and associated costs.
    (2) Ensure continuity of contract support.
    (3) Improve overall contractor performance.
    (4) Facilitate longer term contractual relationships with those 
contractors that continually meet or exceed quality performance 
expectations.
    (b) An option is normally in the Government's interest in the 
following circumstances:
    (1) There is an anticipated need for additional supplies or 
services during the contract term.
    (2) When there is both a need for additional supplies or services 
beyond the basic contract period and the use of multi-year contracting 
authority is inappropriate.
    (3) There is a need for continuity of supply or service support.
    (c) An option shall not be used if the market price is likely to 
change substantially and an economic price adjustment clause 
inadequately protects the Government's interest.

[[Page 62439]]

PART 532--CONTRACT FINANCING

0
9. The authority citation for 48 CFR part 532 continues to read as 
follows:

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

0
10. Revise section 532.111 to read as follows:


532.111  Contract clauses for non-commercial purchases.

    Insert the clause at 552.232-5, Payments under Fixed-Price 
Construction Contracts, in solicitations and contracts when a fixed-
price construction contract is contemplated.

PART 536--CONSTRUCTION AND ARCHITECT-ENGINEER CONTRACTS

0
11. The authority citation for 48 CFR part 536 continues to read as 
follows:

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

0
12. Revise subpart 536.2 to read as follows:

Subpart 536.2--Special Aspects of Contracting for Construction


536.270 Options in construction contracting.
536.270-1 Use of options.
536.270-2 Solicitations.
536.270-3 Evaluation.
536.270-4 Exercise of options.
536.270-5 Solicitation provisions and contract clauses.''


536.270  Options in construction contracting.


536.270-1  Use of options.

    (a) Subject to the limitations in this subsection, contracting 
officers may include options in contracts when it is in the 
Government's interest.
    (b) The scope of work in the base contract at award shall require 
the contractor to provide a discrete and fully functional deliverable. 
Options shall not be used to incrementally deliver work required to 
fulfill the requirements of the scope of work for the base contract.
    (c) Contracting officers shall justify in writing the use of 
options.
    (d) Including an option may be in the Government's interest when, 
in the judgment of the contracting officer--
    (1) Additional work beyond the base contract is reasonably 
foreseeable;
    (2) It would not be advantageous to award a separate contract;
    (3) It would not be advantageous to permit an additional contractor 
to work on the same site;
    (4) Services arising out of or relating to the underlying 
construction contract may be required during or after substantial 
completion of the scope of work. For instance, if building equipment 
(e.g., mechanical and electrical equipment) will be installed under the 
construction contract, it may be advantageous to have the construction 
contractor maintain and service the equipment. In such an instance, the 
services performed may be included as an option to the underlying 
construction contract. Contracting officers shall ensure that the 
applicable clauses are included in any such option (e.g., Service 
Contract Act); or
    (5) It is otherwise justified.
    (e) Options for construction work may provide for an economic price 
adjustment based on cost or price indexes of labor or materials (see 
FAR 16.203-4(d)). Subject to the approval of the HCA, the contracting 
officer may develop and insert a project-specific price adjustment 
clause into the solicitation.


536.270-2  Solicitations.

    Solicitations containing options shall--
    (a) Include appropriate option provisions and clauses when 
resulting contracts will provide for the exercise of options (see 
536.270-5);
    (b) State the period within which the options may be exercised; and
    (c) State whether the basis of evaluation is inclusive or exclusive 
of the options (if exclusive, see 536.270-4(c)).


536.270-3  Evaluation.

    For sealed bidding that includes options--
    (a) The low bidder for purposes of award is the responsible bidder 
offering the lowest aggregate price for the base bid and all options 
designated to be evaluated; and
    (b) Before opening bids that include options, the contracting 
officer must determine, and record in the contract file, the amount of 
funds available for the project. The amount recorded must be announced 
at the beginning of the bid opening. This amount may be increased later 
when determining the items to be awarded to the low bidder if the 
following condition is met: the award amount of the base bid and 
evaluated options does not exceed the amount offered for the base bid, 
the evaluated options, and the same combination of items by any other 
responsible bidder whose bid conforms to the solicitation. This 
requirement prevents the displacement of the low bidder by manipulating 
the options to be used.


536.270-4  Exercise of options.

    (a) The contracting officer shall exercise options in writing 
within the time period specified in the contract.
    (b) The contracting officer may exercise options only after 
determining, in writing, that all the following conditions exist:
    (1) Funds are available.
    (2) The requirement covered by the option fulfills an existing 
Government need.
    (3) Exercising the option is the most advantageous method of 
satisfying the Government's need, price and other factors considered.
    (4) The contractor is not listed in the System for Award Management 
Exclusions (see FAR 9.405-1).
    (5) The contractor's performance under the contract met or exceeded 
the Government's expectation for quality performance, unless another 
circumstance justifies an extended contractual relationship.
    (6) Exercising the option is in accordance with the terms of the 
option.
    (7) The option price is fair and reasonable, unless already 
determined as such (e.g., at time of award).
    (c) The contract modification, or other written document which 
notifies the contractor of the exercise of the option, must cite the 
option clause as authority. If exercising an unpriced or unevaluated 
option, cite the statutory authority permitting the use of other than 
full and open competition (see FAR 6.302).
    (d) When the contract provides for economic price adjustment and 
the contractor requests a revision of the price, the contracting 
officer shall determine the effect of the adjustment on prices under 
the option before the option is exercised.


536.270-5  Solicitation provisions and contract clauses.

    (a) Insert a provision substantially the same as the provision at 
552.236-74, Evaluation of Options, in solicitations for fixed-price 
construction contracts when the solicitation contains an option clause 
and options will be included in the evaluation for award purposes.
    (b) Insert a provision substantially the same as the provision at 
552.236-75, Evaluation Exclusive of Options, in solicitations for 
fixed-price construction contracts when the solicitation includes an 
option clause and options will not be included in the evaluation for 
award purposes.
    (c) Insert a provision substantially the same as the provision at 
552.236-76, Basis of Award-Sealed Bidding Construction, in 
solicitations for fixed-price construction contracts when contracting 
by sealed bidding. Use the provision with its Alternate I when the 
solicitation contains an option clause.
    (d) Insert a clause substantially the same as the clause at 
552.236-77,

[[Page 62440]]

Government's Right to Exercise Options, in solicitations and contracts 
for construction that include options.
0
13. Revise subpart 536.5 to read as follows:

Subpart 536.5--Contract Clauses


536.506 Superintendence by the contractor.
536.511 Use and possession prior to completion.
536.515 Schedules for construction contracts.
536.521 Specifications and drawings for construction.
536.570 Authorities and limitations.
536.571 Contractor responsibilities.
536.572 Submittals.
536.573 Subcontracts.


536.506  Superintendence by the contractor.

    Insert the clause at 552.236-6, Superintendence by the Contractor, 
in solicitations and contracts if construction, dismantling, 
demolition, or removal of improvements is contemplated.


536.511  Use and possession prior to completion.

    Insert the clause at 552.236-11, Use and Possession Prior to 
Completion, in solicitations and contracts if construction, 
dismantling, demolition, or removal of improvements is contemplated.


536.515  Schedules for construction contracts.

    Insert the clause at 552.236-15, Schedules for Construction 
Contracts, in solicitations and contracts if construction, dismantling, 
demolition, or removal of improvements is contemplated. Use the 
clause--
    (a) With its Alternate I when the contract amount is expected to be 
above the simplified acquisition threshold and a design-bid-build 
project delivery method will be followed; or
    (b) With its Alternate II when the contract amount is expected to 
be above the simplified acquisition threshold and a design-build 
project delivery method will be followed.


536.521  Specifications and drawings for construction.

    Insert the clause at 552.236-21, Specifications and Drawings for 
Construction, in solicitations and contracts if construction, 
dismantling, demolition, or removal of improvements is contemplated. 
Use the clause with its Alternate I when a design-build project 
delivery method will be followed.


536.570  Authorities and limitations.

    Insert the clause at 552.236-70, Authorities and Limitations, in 
solicitations and contracts if construction, dismantling, demolition, 
or removal of improvements is contemplated.


536.571  Contractor responsibilities.

    Insert the clause at 552.236-71, Contractor Responsibilities, in 
solicitations and contracts if construction, dismantling, demolition, 
or removal of improvements is contemplated. Use the clause with its 
Alternate I when a design-build project delivery method will be 
followed.


536.572  Submittals.

    Insert the clause at 552.236-72, Submittals, in solicitations and 
contracts if construction, dismantling, demolition, or removal of 
improvements is contemplated. Use the clause with its Alternate I when 
a design-build project delivery method will be followed.


536.573  Subcontracts.

    Insert the clause at 552.236-73, Subcontracts, in solicitations and 
contracts if construction, dismantling, demolition, or removal of 
improvements is contemplated.

PART 543--CONTRACT MODIFICATIONS

0
14. The authority citation for 48 CFR part 543 is revised to read as 
follows:

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

0
15. Revise section 543.205 to read as follows:


543.205  Contract clauses.

    The contracting officer shall insert 552.243-71, Equitable 
Adjustments, in solicitations and contracts containing FAR 52.243-4, 
Changes, FAR 52.243-5, Changes and Changed Conditions, or FAR 52.236-2, 
Differing Site Conditions.

PART 546--QUALITY ASSURANCE

0
16. The authority citation for 48 CFR part 546 continues to read as 
follows:

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

0
17. Add section 546.704 to read as follows:


546.704  Authority for use of warranties.

    FAR clause 52.246-21, Warranty of Construction, is approved by the 
agency for use in solicitations and contracts when a fixed-price 
construction contract is contemplated.

PART 552--SOLICITATION PROVISIONS AND CONTRACT CLAUSES

0
18. The authority citation for 48 CFR part 552 continues to read as 
follows:

    Authority:  40 U.S.C. 121(c).
0
19. Add section 552.211-10 to read as follows:


552.211-10  Commencement, Prosecution, and Completion of Work.

    As prescribed in 511.404, insert the following clause:

Commencement, Prosecution, and Completion of Work (DATE)

    FAR 52.211-10, Commencement, Prosecution, and Completion of 
Work, is supplemented as follows:
    (a) The Contractor shall not commence work until the Contracting 
Officer issues a notice to proceed.
    (b) Notwithstanding paragraph (a) above, the Contractor must 
submit any required safety plans before commencing any construction 
work.
    (c) The Contractor shall diligently prosecute the work so as to 
achieve substantial completion of the work within the time specified 
in the contract. If the contract specifies different completion 
dates for different phases or portions of the work, the Contractor 
shall diligently prosecute the work so as to achieve substantial 
completion of such phases or portions of the work within the times 
specified.

(End of clause)

0
20. Add sections 552.211-12 and 552.211-13 to read as follows:


552.211-12  Liquidated Damages--Construction.

    As prescribed in 511.504, insert the following clause:

Liquidated Damages (DATE)

    FAR 52.211-12, Liquidated Damages-Construction, is supplemented 
as follows:
    (a) If the Contractor fails to achieve substantial completion of 
the work within the time specified in the contract, the Contractor 
shall be liable to the Government for liquidated damages at the rate 
specified for each calendar day following the required completion 
date that the work is not substantially complete.
    (b) If the contract requires different completion dates for 
different phases or portions of the work, the Contractor shall be 
liable for liquidated damages at the specified rate for each 
calendar day following the required completion date that the phase 
or portion of work is not substantially complete. If a single rate 
is specified, the specified rate shall be apportioned between the 
different phases or portions of the work.
    (c) If the Government elects to accept any portion of the work 
not specifically designated as a phase or portion of work with its 
own required completion date, the liquidated damage rate shall be 
apportioned between accepted work and uncompleted work, and the 
Contractor's liability for liquidated damages shall be computed 
accordingly.


(End of clause)

[[Page 62441]]

552.211-13  Time Extensions.

    As prescribed in 511.504, insert the following clause:

Time Extensions (DATE)

    FAR 52.211-13, Time Extensions, is supplemented as follows:
    (a) If the Contractor requests an extension of the time for 
substantial completion, the Contractor shall base its request on an 
analysis of time impact using the project schedule as its baseline, 
and shall propose as a new substantial completion date to account 
for the impact. The Contractor shall submit a written request to the 
Contracting Officer setting forth facts and analysis in sufficient 
detail to enable the Contracting Officer to evaluate the 
Contractor's entitlement to an extension of time.
    (b) The Contractor shall only be entitled to an extension of 
time to the extent that--
    (1) Substantial completion of the work is delayed by causes for 
which the Contractor is not responsible under this contract; and
    (2) The actual or projected substantial completion date is later 
than the date required by this contract for substantial completion.
    (c) The Contractor shall not be entitled to an extension of time 
if the Contractor has not updated the project schedule in accordance 
with the contract.
    (d) The Government shall not be liable for any costs to mitigate 
time impacts incurred by the Contractor that occur less than 30 
calendar days after the date the Contractor submits a request for 
extension of time in compliance with this clause.


(End of clause)

0
21. Add section 552.211-70 to read as follows:


552.211-70  Substantial Completion.

    As prescribed in 511.404, insert the following clause:

Substantial Completion (DATE)

    (a) General. (1) For the purposes of FAR 52.211-10, 
Commencement, Prosecution and Completion of Work, and FAR 52.211-12, 
Liquidated Damages-Construction, the work shall be deemed complete 
when it is ``substantially complete.''
    (2) There may be different completion dates required for 
different phases or portions of the work, as established in the 
contract. However, the work shall be deemed ``substantially 
complete'' if and only if the Contractor has completed the work and 
related contract obligations in accordance with the contract 
documents, such that the Government may enjoy the intended access, 
occupancy, possession, and use of the entire work without impairment 
due to incomplete or deficient work, and without interference from 
the Contractor's completion of remaining work or correction of 
deficiencies in completed work.
    (3) In no event shall the work be deemed ``substantially 
complete'' if all fire and life safety systems are not tested and 
accepted by the authority having jurisdiction, where such acceptance 
is required under the contract.
    (4) Unless otherwise specifically noted, or otherwise clear from 
context, all references in the contract to ``acceptance'' shall 
refer to issuance of a written determination of substantial 
completion by the Contracting Officer.
    (b) Notice of Substantial Completion. (1) With reasonable 
advance notice, the Contractor shall submit to the Contracting 
Officer a written proposal recommending a substantial completion 
date.
    (2) If the Contracting Officer takes exception to the notice of 
substantial completion, the Contractor shall be entitled to a 
written notice of conditions precluding determination of substantial 
completion. The Contractor shall only be entitled to an extension of 
time to address such conditions if, and to the extent that, the 
Contracting Officer provides notice of such conditions more than 30 
calendar days after receipt of the notice of substantial completion.
    (c) Acceptance of Substantial Completion. (1) The Contracting 
Officer shall conduct inspections and make a determination of 
substantial completion within a reasonable time.
    (2) Substantial Completion shall be established by the 
Contracting Officer's issuance of a written determination specifying 
the date upon which the work is substantially complete.
    (d) Contract Completion. (1) The Contract is complete if and 
only if the Contractor has completed all work and related contract 
obligations, corrected all deficiencies and all punch list items, 
and complied with all conditions for final payment.
    (2) The Contractor shall not be entitled to final payment or 
release of any retainage held by the Government until after contract 
completion. If the Contractor does not achieve contract completion 
within the time required by this contract, the Government shall be 
entitled, after providing notice to the Contractor, to complete any 
work remaining unfinished. The Contractor shall be liable to the 
Government for all costs incurred by the Government to complete such 
work.


(End of clause)

0
22. Add sections 552.232-5 and 552.232-6 to read as follows:


552.232-5  Payments under Fixed-Price Construction Contracts.

    As prescribed in 532.111, insert the following clause:

Payments Under Fixed-Price Construction Contracts (DATE)

    FAR 52.232-5, Payments Under Fixed-Price Construction Contracts, 
is supplemented as follows:
    (a) Before submitting a request for payment, the Contractor 
shall, unless directed otherwise by the Contracting Officer, attend 
pre-invoice payment meetings, as scheduled, with the designated 
Government representative for the purpose of facilitating review and 
approval of payment requests. Payment meetings will be conducted and 
may be in person. The Contractor shall provide documentation to 
support the prospective payment request.
    (b) The Contractor shall submit its invoices to the Contracting 
Officer, unless directed otherwise by the Contracting Officer. 
Separate payment requests shall be submitted for progress payments, 
payments of retainage, and partial or final payments.
    (c) The Contractor shall use GSA Form 2419 Certification of 
Progress Payments Under Fixed-Price Construction Contracts to 
provide the certification required under FAR 52.232-5(c).
    (d) The Contractor shall use GSA Form 1142 Release of Claims to 
provide the certification required under FAR 52.232-5(h).
    (e) If an invoice does not meet the requirements of FAR 52.232-
27 and GSAM 552.232-27, the Contracting Officer may return the 
invoice to the Contractor without payment for correction. If the 
Contracting Officer disputes the requested payment amount, the 
Government may pay the portion of the requested payment that is 
undisputed.
    (f) GSA will not be obligated to issue final payment unless the 
Contractor has furnished to the Contracting Officer a release of 
claims against the Government relating to the contract, and 
submitted all required product warranties, as-built drawings, 
operating manuals, and other items as specified in the contract. The 
Contractor may reserve from the release specific claims only if such 
claims are explicitly identified with stated claim amounts.


(End of clause)


552.236-6  Superintendence by the Contractor.

    As prescribed in 536.506, insert the following clause:

Superintendence by the Contractor (DATE)

    The requirements of the clause entitled ``Superintendence by the 
Contractor'' at FAR 52.236-6, are supplemented as follows:
    (a) The Contractor shall employ sufficient management and 
contract administration resources, including personnel responsible 
for project management, field superintendence, change order 
administration, estimating, coordination, inspection, and quality 
control, to ensure the proper execution and timely completion of the 
contract. The Contractor shall designate a principal of the firm or 
other senior management official to provide executive oversight and 
problem resolution resources to the project for the life of the 
contract.
    (b) The Contractor shall employ, and require its subcontractors 
to employ, qualified personnel to perform the contract. The 
Government reserves the right to exclude, or remove from the site or 
building, any personnel for reasons of incompetence, carelessness, 
or insubordination, who violate rules and regulations concerning 
conduct on federal property, or whose continued employment on the 
site is otherwise deemed by the Government to be contrary to the 
public interest.
    (c) The Contractor shall be responsible for coordinating all 
activities of subcontractors, including all of the following 
activities:

[[Page 62442]]

    (1) Preparation of shop drawings produced by different 
subcontractors where their work interfaces or may potentially 
conflict or interfere.
    (2) Scheduling of work by subcontractors.
    (3) Installation of work by subcontractors.
    (4) Use of the project site for staging and logistics.
    (d) Repeated failure or excessive delay to meet the 
superintendence requirements by the Contractor may be deemed a 
default for the purposes of the termination for default clause.


(End of clause)

0
23. Add section 552.236-11 to read as follows:


552.236-11  Use and Possession Prior to Completion.

    As prescribed in 536.511, insert the following clause:

Use and Possession Prior to Completion (DATE)

    Exercise by the Government of the right conferred by FAR 52.236-
11 shall not relieve the Contractor of responsibility for completing 
any unfinished components of the work.


(End of clause)

0
24. Add section 552.236-15 to read as follows:


552.236-15  Schedules for Construction Contracts.

    As prescribed in 536.515, insert the following clause:

Schedules for Construction Contracts (DATE)

    The requirements, of the clause entitled ``Schedules for 
Construction Contracts'' at FAR 52.236-15, are supplemented as 
follows:
    (a) Purpose. The project schedule shall be a rational, 
reasonable, and realistic plan for completing the work, and conform 
to the requirements specified in this clause and elsewhere in the 
contract. The Contractor understands and acknowledges that the 
preparation and proper management of the project schedule is a 
material component of the contract.
    (b) Use of the schedule. The Contracting Officer shall be 
entitled, but not required, to rely upon the project schedule to 
evaluate the Contractor's progress, evaluate entitlement to 
extensions of time, and determine the criticality or float of any 
activities described in such project schedule.
    (c) Submission. Prior to notice to proceed, or such other time 
as may be specified in the contract, the Contractor shall submit the 
project schedule.
    (d) Milestones. The project schedule shall incorporate milestone 
events specified in the contract, including, as applicable, notice 
to proceed, substantial completion, and milestones related to 
specified work phases and site restrictions. The project schedule 
shall also include Contractor-defined milestones to identify target 
dates for critical events, based upon the Contractor's chosen 
sequence of work.
    (e) Activities. The project schedule shall depict all major 
activities necessary to complete the work.
    (f) Schedule of values. (1) The Contractor shall prepare and 
submit for approval a cost breakdown of the Contract price, to be 
referred to as the ``schedule of values'', assigning values to each 
major activity necessary to complete the work.
    (2) Values must include all direct and indirect costs, although 
a separate value for bond costs may be established.
    (3) The schedule of values must contain sufficient detail to 
enable the Contracting Officer to evaluate applications for payment.
    (g) Conflicting terms. (1) If at any time the Contracting 
Officer finds that the project schedule does not comply with any 
contract requirement, the Contracting Officer will provide written 
notice to the Contractor.
    (2) Within 30 calendar days of written notice, or such other 
time as may be specified, from the Contracting Officer, the 
Contractor shall take one of the following actions:
    (i) Revise the project schedule.
    (ii) Adjust activity progress.
    (iii) Provide sufficient information demonstrating compliance.
    (3) If the Contractor fails to sufficiently address the 
Contracting Officer's exceptions to the project schedule, the 
Contracting Officer may--
    (i) Withhold retainage until the project is substantially 
complete or until such time as the Contractor has complied with 
project schedule requirements; or
    (ii) Terminate the contract for default.
    (h) Revisions to the schedule. If the Contractor revises the 
project schedule after initial approved submission, the Contractor 
shall provide in writing a narrative describing the substance of the 
revision, the rationale for the revision, and the impact of the 
revision on the projected substantial completion date and the 
available float for all activities. The addition of detail to 
prospective activities shall not be deemed a revision if the overall 
duration of the detailed activity does not change.
    (i) Updates. Unless a different period for updates is specified 
elsewhere, the Contractor shall update the project schedule weekly 
to reflect actual progress in completing the work, and submit the 
updated project schedule by the following Monday.


(End of clause)

    Alternate I (DATE). As prescribed in 536.515(a), substitute the 
following paragraphs (c), (e), (h), and (i) for paragraphs (c), (e), 
(h), and (i) of the basic clause:
    (c) Submission. Within 30 calendar days of notice to proceed, or 
such other time as may be specified in the contract, the Contractor 
shall submit the project schedule, together with a written narrative 
describing the major work activities, activities on the critical 
path, and major constraints underlying the sequence and logic of the 
project schedule.
    (e) Activities. (1) The Contractor shall use a critical path 
method project schedule to plan, coordinate, and perform the work.
    (2) The project schedule shall depict all activities necessary 
to complete the work, including, as applicable, all submittal and 
submittal review activities, all procurement activities, and all 
field activities, including mobilization, construction, start-up, 
testing, balancing, commissioning, and punchlist.
    (3) Activities shall be sufficiently detailed and limited in 
duration to enable proper planning and coordination of the work, 
effective evaluation of the reasonableness and realism of the 
project schedule, accurate monitoring of progress, and reliable 
analysis of schedule impacts.
    (4) Activity durations shall be based upon reasonable and 
realistic allocation of the resources required to complete each 
activity, given physical and logistical constraints on the 
performance of the work. All logic shall validly reflect physical or 
logistical constraints on relationships between activities. Except 
for the first and last activities in the project schedule, each 
activity shall have at least one predecessor and one successor 
relationship to form a logically connected network plan from notice 
to proceed to the contract completion date.
    (h) Revisions to the schedule. (1) The Contractor should 
anticipate that the initial submittal of the project schedule will 
be subject to review and may require revision. The Contractor shall 
devote sufficient resources for meetings, revisions, and 
resubmissions of the project schedule to address any exceptions 
taken to the initial submittal. The Contractor understands and 
acknowledges that the purpose of the initial review and resolution 
of exceptions is to maximize the usefulness of the project schedule 
for contract performance.
    (2) If the Contractor revises the project schedule after initial 
approved submission, the Contractor shall provide in writing a 
narrative describing the substance of the revision, the rationale 
for the revision, and the impact of the revision on the projected 
substantial completion date and the available float for all 
activities. The addition of detail to prospective activities shall 
not be deemed a revision if the overall duration of the detailed 
activity does not change.
    (i) Updates. Unless a different period for updates is specified 
elsewhere, the Contractor shall update the project schedule monthly 
to reflect actual progress in completing the work, and submit the 
updated project schedule within 5 working days of the end of each 
month.

    Alternate II (DATE). As prescribed in 536-515(b), substitute the 
following paragraphs (c), (e), and (i) for paragraphs (c), (e), and (i) 
of the basic clause:

    (c) Submission. (1) Within 30 calendar days of notice to 
proceed, or such other time as may be specified in the contract, the 
Contractor shall submit the project schedule, together with a 
written narrative describing the major design and construction 
activities. The project schedule may indicate construction 
activities in summary form prior to completion of final design 
documents.
    (2) Within 30 calendar days of completion of final design 
documents, the Contractor shall submit a revised project schedule 
depicting all activities necessary to complete construction work 
activities, together with a written narrative describing the major 
work

[[Page 62443]]

activities, activities on the critical path, and major constraints 
underlying the sequence and logic of the project schedule.
    (e) Activities. (1) The Contractor shall use a critical path 
method project schedule to plan, coordinate, and perform the work.
    (2) Activities shall be sufficiently detailed and limited in 
duration to enable proper planning and coordination of the work, 
effective evaluation of the reasonableness and realism of the 
project schedule, accurate monitoring of progress, and reliable 
analysis of schedule impacts.
    (3) Activity durations shall be based upon reasonable and 
realistic allocation of the resources required to complete each 
activity, given physical and logistical constraints on the 
performance of the work. All logic shall validly reflect physical or 
logistical constraints on relationships between activities. Except 
for the first and last activities in the project schedule, each 
activity shall have at least one predecessor and one successor 
relationship to form a logically connected network plan from notice 
to proceed to the contract completion date.
    (i) Updates. Unless a different period for updates is specified 
elsewhere, the Contractor shall update the project schedule monthly 
to reflect actual progress in completing the work, and submit the 
updated project schedule within 5 working days of the end of each 
month.

0
25. Add section 552.236-21 to read as follows:


552.236-21  Specifications and Drawings for Construction.

    As prescribed in 536.521, insert the following clause:

Specifications and Drawings for Construction (DATE)

    The requirements of the clause entitled ``Specifications and 
Drawings for Construction'' at FAR 52.236-21, are supplemented as 
follows:
    (a) In case of difference between small and large-scale 
drawings, the large-scale drawings shall govern.
    (b) Schedules on any contract drawing shall take precedence over 
conflicting information on that or any other contract drawing.
    (c) On any of the drawings where a portion of the work is 
detailed or drawn out and the remainder is shown in outline, the 
parts detailed or drawn out shall apply also to all other like 
portions of the work.
    (d) Where the word ``similar'' occurs on the drawings, it shall 
have a general meaning and not be interpreted as being identical, 
and all details shall be worked out in relation to their location 
and their connection with other parts of the work.
    (e) Standard details or specification drawings are applicable 
when listed, bound with the specifications, noted on the drawings, 
or referenced elsewhere in the specifications.
    (1) Where notes on the specification drawings indicate 
alterations, such alterations shall govern.
    (2) In case of difference between standard details or 
specification drawings and the specifications, the specifications 
shall govern.
    (3) In case of difference between the standard details or 
specification drawings and the drawings prepared specifically for 
this contract, the drawings prepared specifically for this contract 
shall govern.
    (f) Different requirements within the contract documents shall 
be deemed inconsistent only if compliance with both cannot be 
achieved.
    (g) Unless otherwise noted, the drawings shall be interpreted to 
provide for a complete construction, assembly, or installation of 
the work, without regard to the detail with which material 
components are shown in the drawings.


(End of clause)
    Alternate I (DATE). As prescribed in 536.521, add the following 
paragraph to the basic clause:

    (h) For the purposes of this clause, specifications and drawings 
refer only to those included among the contract documents, and not 
to those produced by the Contractor pursuant to its responsibilities 
under the contract.


552.236-70  [Removed]

0
26. Remove section 552.236-70.


552.236-71  [Redesignated as 552.236-70]

0
27. Redesignate section 552.236-71 as section 552.236-70 and revise it 
to read as follows:


552.236-70  Authorities and Limitations.

    As prescribed in 536.570, insert the following clause:

Authorities and Limitations (DATE)

    (a) All work shall be performed under the general direction of 
the Contracting Officer. The Contracting Officer alone shall have 
the power to bind the Government and to exercise the rights, 
responsibilities, authorities and functions vested in him by the 
contract documents. The Contracting Officer may designate 
contracting officer's representatives (CORs) to act for him. 
Wherever any provision in this contract specifies an individual 
(such as, but not limited to, Construction Engineer, Resident 
Engineer, Inspector or Custodian) or organization, whether 
Governmental or private, to perform any act on behalf of or in the 
interests of the Government, that individual or organization shall 
be deemed to be the COR under this contract but only to the extent 
so specified. The Contracting Officer may, at any time during the 
performance of this contract, vest in any such COR additional power 
and authority to act for him or designate additional CORs, 
specifying the extent of their authority to act for him. A copy of 
each document vesting additional authority in a COR or designating 
an additional COR shall be furnished to the Contractor.
    (b) The Contractor shall perform the contract in accordance with 
any order (including but not limited to instruction, direction, 
interpretation, or determination) issued by a COR in accordance with 
his authority to act for the Contracting Officer; but the Contractor 
assumes all the risk and consequences of performing the contract in 
accordance with any order (including but not limited to instruction, 
direction, interpretation, or determination) of anyone not 
authorized to issue such order.
    (c) If the Contractor receives written notice from the 
Contracting Officer of non-compliance with any requirement of this 
contract, the Contractor must initiate action as may be appropriate 
to comply with the specified requirement as defined in the notice. 
In the event the Contractor fails to initiate such action within a 
reasonable period of time as defined in the notice, the Contracting 
Officer shall have the right to order the Contractor to stop any or 
all work under the contract until the Contractor has complied or has 
initiated such action as may be appropriate to comply within a 
reasonable period of time. The Contractor will not be entitled to 
any extension of contract time or payment for any costs incurred as 
a result of being ordered to stop work for such cause.


(End of clause)
0
28. Add new section 552.236-71 to read as follows:


552.236-71  Contractor Responsibilities.

    As prescribed in 536.571, insert the following clause:

Contractor Responsibilities (DATE)

    (a) The Contractor shall be responsible for compliance with 
applicable codes, standards and regulations pertaining to the health 
and safety of personnel during performance of the contract.
    (b) Unless expressly stated otherwise in the contract, the 
Contractor shall be responsible for all means and methods employed 
in the performance of the contract.
    (c) The Contractor shall immediately bring to the Contracting 
Officer's attention any hazardous materials or conditions not 
disclosed in the contract documents discovered by or made known to 
the Contractor during the performance of the contract.
    (d) The Contractor shall be responsible for providing 
professional design services in connection with performance of the 
work or portions of the work only if this responsibility is 
expressly stated in the contract, and the contract documents provide 
the performance and design criteria that such services will be 
required to satisfy. In the performance of such work, the Contractor 
shall be responsible for retaining licensed design professionals, 
who shall sign and seal all drawings, calculations, specifications 
and other submittals that the licensed professional prepares. The 
Contractor shall be responsible for, and GSA shall be entitled to 
rely upon, the adequacy and completeness of all professional design 
services provided under the contract.
    (e) Where installation of separate work components as shown in 
the contract will result in conflict or interference between such 
components or with existing conditions, including allowable 
tolerances, it is the Contractor's responsibility to bring such

[[Page 62444]]

conflict or interference to the attention of the Contracting Officer 
and seek direction before fabrication, construction, or installation 
of any affected work. If the Contractor fabricates, constructs, or 
installs any work prior to receiving such direction, the Contractor 
shall be responsible for all cost and time incurred to resolve or 
mitigate such conflict or interference.
    (f) Where drawings show work without specific routing, 
dimensions, locations, or position relative to other work or 
existing conditions, and such information is not specifically 
defined by reference to specifications or other information supplied 
in the contract, the Contractor is responsible for routing, 
dimensioning, and locating such work in coordination with other work 
or existing conditions in a manner consistent with contract 
requirements.
    (g) It is not the Contractor's responsibility to ensure that the 
contract documents comply with applicable laws, statutes, building 
codes and regulations. If it comes to the attention of the 
Contractor that any of the contract documents do not comply with 
such requirements, the Contractor shall promptly notify the 
Contracting Officer in writing. If the Contractor performs any of 
the work prior to notifying and receiving direction from the 
Contracting Officer, the Contractor shall assume full responsibility 
for correction of such work, and any fees or penalties that may be 
assessed for non-compliance.


(End of clause)
    Alternate I (DATE). As prescribed in 536.571, delete paragraphs 
(d), (e), (f), and (g) of the basic clause, and insert paragraphs (d), 
(e), (f), and (g) as follows:

    (d) The Contractor shall be responsible for providing 
professional design services unless this responsibility is expressly 
excluded from the contract. In the performance of such work, the 
Contractor shall be responsible for retaining licensed design 
professionals, who shall sign and seal all drawings, calculations, 
specifications and other submittals that the licensed professional 
prepares. The Contractor shall be responsible for, and GSA shall be 
entitled to rely upon, the adequacy and completeness of all 
professional design services provided under the contract.
    (e) The Contractor's responsibilities include the 
responsibilities of the Architect-Engineer Contractor, as specified 
in FAR 52.236-23.
    (f) The Contractor shall include in all subcontracts that 
require professional design services express terms establishing GSA 
as a third party beneficiary. No other person shall be deemed a 
third party beneficiary of the contract.
    (g) The Contractor shall determine whether the information 
contained in the contract documents complies with applicable laws, 
statutes, building codes and regulations. If it comes to the 
attention of the Contractor that any of the contract documents do 
not comply with such requirements, the Contractor shall promptly 
notify the Contracting Officer in writing. If the Contractor 
performs any of the work prior to notifying and receiving direction 
from the Contracting Officer, the Contractor shall assume full 
responsibility for correction of such work, and any fees or 
penalties that may be assessed for non-compliance.

0
29. Add section 552.236-72 to read as follows:


552.236-72  Submittals.

    As prescribed in 536.572, insert the following clause:

Submittals (DATE)

    (a) The Contractor shall prepare and submit all submittals as 
specified in the contract or requested by the Contracting Officer.
    (1) Submittals may include: safety plans, schedules, shop 
drawings, coordination drawings, samples, calculations, product 
information, or mockups.
    (2) Shop drawings may include fabrication, erection and setting 
drawings, manufacturers' scale drawings, wiring and control 
diagrams, cuts or entire catalogs, pamphlets, descriptive 
literature, and performance and test data.
    (b) Unless otherwise provided in this contract, or otherwise 
directed by the Contracting Officer, submittals shall be submitted 
to the Contracting Officer.
    (c) The Contractor shall be entitled to receive notice of action 
on submittals within a reasonable time, given the volume or 
complexity of the submittals and the criticality of the affected 
activities to substantial completion as may be indicated in the 
project schedule.
    (d) Review of submittals will be general and shall not be 
construed as permitting any departure from the contract 
requirements.
    (e) The Contractor shall not proceed with construction work or 
procure products or materials described or shown in submittals until 
the submittal is reviewed. Any work or activity undertaken prior to 
review shall be at the Contractor's risk. Should the Contracting 
Officer subsequently determine that the work or activity does not 
comply with the contract, the Contractor shall be responsible for 
all cost and time required to comply with the Contracting Officer's 
determination. The Contracting Officer shall have the right to order 
the Contractor to cease execution of work for which submittals have 
not been reviewed. The Government shall not be liable for any cost 
or delay incurred by the Contractor attributable to the proper 
exercise of this right.
    (f) The Contractor shall identify, in writing, all deviations or 
changes in resubmitted submittals. In the absence of such written 
notice, review of a resubmission shall not include or apply to such 
deviations or changes.


(End of clause)
    Alternate I (DATE). As prescribed in 536.572, add the following 
paragraph to the basic clause:

    (g) The Contractor shall submit design documents for review in 
accordance with PBS-P100. The Government shall review submittals for 
the limited purpose of verifying that the documents conform to the 
design criteria expressed in the contract documents.


552.236-73 through 81  [Removed]

0
30. Remove sections 552.236-73 through 81.


552.236-82  [Redesignated as 552.236-73]

0
31. Redesignate section 552.236-82 as section 552.236-73 and revise the 
introductory text to read as follows:


552.236-73  Subcontracts.

    As prescribed in 536.573, insert the following clause:
* * * * *
0
32. Add new sections 552.236-74 through 552.236-77 to read as follows:


552.236-74  Evaluation of Options.

    As prescribed in 536.270-5(a), insert the following provision:

Evaluation of Options (DATE)

    The Government will evaluate offers for award purposes by adding 
the total price for all options to the total price for the basic 
requirement. Evaluation of options will not obligate the Government 
to exercise the option(s).

    (End of provision)


552.236-75  Evaluation Exclusive of Options.

    As prescribed in 536.270-5(b), insert the following provision:

Evaluation Exclusive of Options (DATE)

    The Government will evaluate offers for award purposes by 
including only the price for the basic requirement. Options will not 
be included in the evaluation for award purposes.


(End of provision)


552.236-76  Basis of Award--Sealed Bidding Construction

    As prescribed in 536.270-5(c), insert the following provision:

Basis of Award--Sealed Bidding Construction (DATE)

    A bid may be rejected as nonresponsive if the bid is materially 
unbalanced as to bid prices. A bid is unbalanced when the bid is 
based on prices significantly less than cost for some work and 
significantly overstated for other work.


(End of provision)
    Alternate I (DATE). As prescribed in 536.270-5(c), designate the 
basic provision as paragraph (a) and add the following paragraph to the 
basic provision:

    (b) The low bidder for purposes of award is the responsible 
bidder offering the lowest aggregate price for (1) the base 
requirement plus (2) all options designated to be evaluated. The 
evaluation of options will not obligate the Government to exercise 
the options.

[[Page 62445]]

552.236-77  Government's Right to Exercise Options.

    As prescribed in 536.270-5(d), insert the following clause:

Government's Right to Exercise Options (DATE)

    (a) The Government may exercise any option in writing in 
accordance with the terms and conditions of the contract within 
_____ [insert the period of time within which the Contracting 
Officer may exercise the option]. Unless otherwise specified, 
options may be exercised within 90 calendar days of contract award.
    (b) If the Government exercises the option, the contract shall 
be considered to include this option clause.


(End of clause)
0
33. Amend section 552.243-71 by--
0
a. Revising the date of the clause,
0
b. Removing from paragraph (a) ``FAR 52.243-4'' and adding ``FAR 
52.243-4, the ``Changes and Changed Conditions'' clause prescribed by 
FAR 52.243-5,'' in its place; and
0
c. Revising paragraph (c).
    The revisions read as follows:


552.243-71  Equitable Adjustments.

    As prescribed in 543.205, insert the following clause:

Equitable Adjustments (DATE)

* * * * *
    (c) The proposal shall be submitted within the time specified in 
the ``Changes'', ``Changes and Changed Conditions'', or ``Differing 
Site Conditions'' clause, as applicable, or such other time as may 
reasonably be required by the Contracting Officer.
* * * * *
[FR Doc. 2016-21629 Filed 9-8-16; 8:45 am]
 BILLING CODE 6820-61-P