[Federal Register Volume 82, Number 9 (Friday, January 13, 2017)]
[Rules and Regulations]
[Pages 4709-4716]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2016-31495]


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DEPARTMENT OF DEFENSE

GENERAL SERVICES ADMINISTRATION

NATIONAL AERONAUTICS AND SPACE ADMINISTRATION

48 CFR Parts 2, 3, 4, 5, 7, 8, 9, 12, 14, 15, 16, 17, 27, 32, 42, 
48, 49, and 52

[FAC 2005-95; FAR Case 2013-014; Item I; Docket No. 2013-0014, Sequence 
No. 1]
RIN 9000-AM73


Federal Acquisition Regulation; Uniform Use of Line Items

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

ACTION: Final rule.

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SUMMARY: DoD, GSA, and NASA are issuing a final rule amending the 
Federal Acquisition Regulation (FAR) to establish uniform use of line 
items in Federal procurement.

DATES: Effective: January 13, 2017. In order to provide agencies with 
time to transition their information systems, agencies have until 
October 1, 2019, to apply the requirements of FAR 4.1002 through 4.1008 
of subpart 4.10.

FOR FURTHER INFORMATION CONTACT: Ms. Camara Francis, Procurement 
Analyst, at 202-550-0935 for clarification of content. For information 
pertaining to status or publication schedules, contact the Regulatory 
Secretariat Division at 202-501-4755. Please cite FAC 2005-95, FAR Case 
2013-014.

SUPPLEMENTARY INFORMATION: 

I. Background

    DoD, GSA, and NASA published a proposed rule in the Federal 
Register at 79 FR 45408 on August 5, 2014, to establish uniform use of 
line items in Federal procurement. The uniform line item structure is 
designed to improve the accuracy, traceability, and usability of 
procurement data. The need for this rule stems from the lack of access 
to reliable and comprehensive data on Federal procurement actions that 
is essential to management and program decisions that result in 
delivering services to taxpayers in the most efficient and effective 
manner. Lack of standards for identifying and tracing tax dollars 
across the acquisition contributes to duplication in spending, gaps in 
reporting, and inefficiencies in management decisions. The 
implementation of these standards will facilitate the identification 
and traceability of spending from appropriation through expenditure, 
supporting automated collection of information using key identifiers. 
Three respondents submitted comments on the proposed rule.

II. Discussion and Analysis

    The Civilian Agency Acquisition Council and the Defense Acquisition 
Regulations Council (the Councils) reviewed the public comments in the 
development of the final rule. A discussion of the comments and the 
changes made to the rule as a result of those comments are provided as 
follows:

A. Summary of Significant Changes From the Proposed Rule

    1. The rule provides agencies time to transition their information 
systems and appropriately train the workforce. Accordingly, agencies 
have until October 1, 2019, to apply the requirements of FAR 4.1002 
through 4.1008 of subpart 4.10.
    2. The term ``line item unique identifier'' was removed and 
replaced with ``line item number'' for consistency with the current 
version of the FAR text. The term ``unique'' is no longer necessary due 
to changes made by the Uniform Procurement Identification rule (FAR 
Case 2012-023) published in the Federal Register at 79 FR 61739 on 
October 14, 2014.

B. Analysis of Public Comments

1. Alternative Line Item Structure
    Comment: One respondent suggested removing text that would allow 
offerors to propose their own alternative line item structure, because 
this would be counterproductive to the goal of standardized reporting.
    Response: The language on alternative line items was intended to 
allow flexibility, consistent with the requirements at FAR subpart 
4.10. To clarify that the Government is not requesting contractors to 
create line items inconsistent with the rule, the clause is renamed 
``Alternative Line Item Proposal'' and the explanatory text will no 
longer use the term ``structure,'' as this seemed to be the cause of 
some confusion.
2. Accounting Classification Citation
    Comment: One respondent asked if each subline item is expected to 
have its own accounting classification citation.
    Response: It is not a requirement for each subline item to have its 
own accounting classification citation. However, each deliverable 
subline item is expected to have its own accounting classification 
citation. This should not be construed to mean that the same

[[Page 4710]]

accounting classification citation cannot apply to multiple line items.
    Comment: One respondent opined that a contract line item number or 
subline item number should not be created for the sole purpose of 
addressing an accounting classification, because this information is 
already tracked in financial systems. The respondent also questioned 
the specificity of the required accounting data on subline item 
numbers, because this data could not be gathered effectively through 
automated means.
    Response: Only a deliverable subline item is expected to have its 
own accounting classification citation. While it is true that some 
Government systems are integrated to trace accounting classification 
citations to specific line items, this is not the case for all systems 
and this rule allows for linking accounting classification citations 
directly to line items in contract writing systems.
3. Exceptions
    Comment: One respondent recommended adding exceptions to the text 
related to the requirement to include accounting classification 
citations on line items.
    Response: There is no need for an exception to include accounting 
classification citations on line items, as this is not required, but is 
allowed. The text at FAR 4.1003(c) is modified to make it clear that 
multiple accounting classification citations can be provided on a line 
item.
4. Implementation
    Comment: One respondent requested pushing the implementation date 
of the line item requirement further into the future, beyond October 1, 
2016, due to the associated burden.
    Response: The implementation date of this requirement for uniform 
line item use is now set for October 1, 2019.
5. Contract Milestone
    Comment: One respondent inquired if a contact milestone will be 
considered a deliverable for the purpose of assigning contract line 
item numbers, based on the proposed definition of ``line item'' in FAR 
2.101.
    Response: Yes, a deliverable line item can be created for a 
contract milestone, but it is not required to be used for this purpose.
6. Existing Systems
    Comment: One respondent challenged the background of the case 
``funding traceability is limited to contract-level information'' by 
pointing out that NASA has systems in place that can capture financial 
data with great detail, including units and prices, descriptions, and 
accounting line information.
    Response: This may be the case for some existing systems; however, 
not all Government systems have these capabilities.
    Comment: One respondent pointed out that accounting information is 
already collected in Federal Procurement Data System--Next Generation 
(FPDS-NG) for appropriated funds, and questioned the need to gather 
more explicit accounting information that would burden contractors with 
tracking Government accounting lines.
    Response: FPDS-NG captures data related to the preponderance of the 
spending on a contract, not details on contract line items. This rule 
does not require contractors to track any new information.
7. Delete Text (FAR 4.1003 & 4.1005(a)(4))
    Comment: One respondent suggested removing the proposed text at FAR 
4.1003(c) and 4.1005-1(a)(4), because contractors do not need to be 
informed of Government accounting information and because this 
information is already available to the Government in accounting and 
contract reporting systems.
    Response: While some Government systems are capable of tracing 
accounting data to specific line items through other means, most of 
them are not. The recommended text is not removed from the final rule.
8. Exhibit Line Item
    Comment: One respondent asked if the FAR Council plans to address 
exhibit lines and formally define them as part of the Governmentwide 
initiative for standardized line item structures.
    Response: No, not at this time.
9. Acronyms
    Comment: One respondent asked if the FAR Council intends to 
minimize the use of acronyms, specifically CLIN, SLIN, and ELIN.
    Response: The FAR currently does not use SLIN or ELIN. The 
instances where the FAR uses CLIN were removed by this rule. 
Accordingly, there is no intent to address the use of these acronyms in 
this rule.
10. Defense Federal Acquisition Regulation Supplement (DFARS) 
Procedure, Guidance, and Information (PGI)
    Comment: One respondent asked if there is a plan to incorporate the 
entire DFARS PGI in the FAR for Governmentwide use, beyond DoD.
    Response: This is outside the scope of this rule.

C. Other Changes

    1. The definition of ``line item'' is modified to clarify that this 
term is inclusive of subline items when it is applicable.
    2. The term ``line item number'' is now defined to clarify that a 
line item may be identified in a numeric or alphanumeric format.
    3. FAR 4.1003(c) and 4.1005-1(a)(4) are modified to note that 
multiple accounting classification citations can be provided on a 
single line item.
    4. FAR 4.1004 is modified to clarify that the characteristics in 
4.1003 apply to subline items that are deliverable but not 
informational subline items.
    5. The requirement to include the national stock number or special 
item number at FAR 8.406-4(c)(3)(i)(C) is removed.
    6. FAR 15.203(a)(2) is amended to clarify the process for allowing 
and evaluating proposals with alternative line item structures.

III. 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 
review under Section 6(b) of E.O. 12866, Regulatory Planning and 
Review, dated September 30, 1993. This rule is not a major rule under 5 
U.S.C. 804.

IV. Regulatory Flexibility Act

    DoD, GSA, and NASA have prepared a Final Regulatory Flexibility 
Analysis (FRFA) consistent with the Regulatory Flexibility Act, 5 
U.S.C. 601, et seq. The FRFA is summarized as follows:

    This final rule establishes uniform use of line items in Federal 
procurement. The uniform use of line items is designed to improve 
the accuracy, traceability, and usability of procurement data. This 
rule continues Federal procurement efforts to more robustly 
implement the objectives of the Federal Funding Accountability and 
Transparency Act of 2006 (Pub. L. 109-282), including promoting 
achievement of rigorous

[[Page 4711]]

accountability of procurement dollars and processes.
    The requirements in this rule have the potential to have an 
impact on any entity, small or large, that does business with the 
Federal Government, because the rule would apply to purchases of 
items, including commercial items and commercially available off-
the-shelf items, and purchases under the simplified acquisition 
threshold. However, line item pricing is a common commercial 
practice; therefore, the impact may not be significant.
    None of the public comments addressed the initial regulatory 
flexibility analysis.
    Any small business that contracts with a Federal agency could be 
impacted to at least some extent. Using data from the Federal 
Procurement Data System, there were 107,172 such small entities in 
fiscal year (FY) 2010, 97,626 in FY 2011, 85,749 in FY 2012, and 
73,987 in FY 2013 doing business with the Federal Government.
    The rule could require some contractors to restructure their 
proposal pricing process as well as their systems to accommodate the 
line item identification system. This change may also require 
contractors to make changes to their pricing and electronic systems. 
Contractors may also have to develop more extensive pricing data to 
conform to a new line item structure. However, this consistent line 
item identification policy should be beneficial to contractors doing 
business with executive branch agencies. This is especially true if 
contractors already have contracts with the Department of Defense 
(DoD), because these identification standards are already in use. 
Accordingly, contractors that currently contract with DoD will not 
be impacted. There is no data at this time on cost impacts to 
contractors in making this change.
    The rule contains no reporting, recordkeeping, or other 
compliance requirements on the vendor community.
    DoD, GSA, and NASA have not identified any significant 
alternatives to accomplish the stated objectives of this rule that 
would reduce impact on small entities.

    Interested parties may obtain a copy of the FRFA from the 
Regulatory Secretariat Division. The Regulatory Secretariat Division 
has submitted a copy of the FRFA to the Chief Counsel for Advocacy of 
the Small Business Administration.

V. Paperwork Reduction Act

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

List of Subjects in 48 CFR Parts 2, 3, 4, 5, 7, 8, 9, 12, 14, 15, 
16, 17, 27, 32, 42, 48, 49, and 52

    Government procurement.

    Dated: December 21, 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 amend 48 CFR parts 2, 3, 4, 5, 7, 8, 
9, 12, 14, 15, 16, 17, 27, 32, 42, 48, 49, and 52 as set forth below:

0
1. The authority citation for 48 CFR parts 2, 3, 4, 5, 7, 8, 9, 12, 14, 
15, 16, 17, 27, 32, 42, 48, 49, and 52 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 2--DEFINITION OF WORDS AND TERMS

0
2. Amend section 2.101 in paragraph (b)(2) by adding, in alphabetical 
order, the definitions ``Line item'', ``Line item number'', and 
``Subline item'' to read as follows:


2.101  Definitions.

* * * * *
    (b) * * *
    (2) * * *
    Line item means the basic structural element in a procurement 
instrument that describes and organizes the required product or service 
for pricing, delivery, inspection, acceptance, invoicing, and payment. 
The use of the term ``line item'' includes ``subline item,'' as 
applicable.
    Line item number means either a numeric or alphanumeric format to 
identify a line item.
* * * * *
    Subline item means a subset of a line item.
* * * * *

PART 3--IMPROPER BUSINESS PRACTICES AND PERSONAL CONFLICTS OF 
INTEREST


3.302  [Amended]

0
3. Amend section 3.302 by removing the definition ``Line item''.

PART 4--ADMINISTRATIVE MATTERS

0
4. Revise subpart 4.10 to read as follows:
Subpart 4.10--Uniform Use of Line Items
Sec.
4.1000 Scope.
4.1001 Policy.
4.1002 Applicability.
4.1003 Establishing line items.
4.1004 Establishing subline items.
4.1005 Data elements for line items and subline items.
4.1005-1 Required data elements.
4.1005-2 Exceptions.
4.1006 Modifications.
4.1007 Solicitation alternative line item proposal.
4.1008 Solicitation provision.

SUBPART 4.10--Uniform Use of Line Items


4.1000  Scope.

    This subpart prescribes policies and procedures for assigning line 
items and subline items and their identifiers. However, in order to 
provide agencies with time to transition their information systems, 
agencies have until October 1, 2019, to apply the requirements of 
4.1002 through 4.1008.


4.1001  Policy.

    In order to improve the accuracy, traceability, and usability of 
procurement data, procurement instruments shall identify the supplies 
or services to be acquired as separately identified line items and, as 
needed, subline items.
    (a) Line items are established to define deliverables or organize 
information about deliverables. Each line item describes 
characteristics for the item purchased, e.g., pricing, delivery, and 
funding information.
    (b) Each line item may be subdivided into separate unique subsets 
(called subline items) to ease administration. If a line item has 
deliverable subline items, the line item is informational. Subline 
items differentiate between or among certain characteristics of the 
line item, such as colors or sizes, dates of delivery, destinations, or 
places of performance. Subline items are established to define 
deliverables or organize information about deliverables.


4.1002  Applicability.

    The policies of this subpart shall apply to the following 
procurement instruments, to include amendments, modifications, and 
change orders thereto:
    (a) Solicitations.
    (b) Contracts, including, but not limited to, Governmentwide 
acquisition contracts (GWACs), multi-agency contracts (MACs), Federal 
Supply Schedule (FSS) contracts, indefinite-delivery contracts, and 
purchase orders.
    (c) Agreements that include pre-priced supplies or services.
    (d) Task and delivery orders.


4.1003  Establishing line items.

    Establish separate line items for deliverables that have the 
following characteristics except as provided at 4.1005-2:
    (a) Separately identifiable.
    (1) A supply is separately identifiable if it has its own 
identification (e.g., national stock number (NSN), item

[[Page 4712]]

description, manufacturer's part number).
    (2) Services are separately identifiable if they have no more than 
one statement of work or performance work statement.
    (3) If the procurement instrument involves a first article (see 
subpart 9.3), establish a separate line item for each item requiring a 
separate approval. If the first article consists of a lot composed of a 
mixture of items that will be approved as a single lot, a single line 
item may be used.
    (b) Single unit price or total price.
    (c) Single accounting classification citation. A single deliverable 
may be funded by multiple accounting classifications when the 
deliverable effort cannot be otherwise subdivided.
    (d) Separate delivery schedule, destination, period of performance, 
or place of performance.
    (e) Single contract pricing type (e.g., fixed-price or cost-
reimbursement).


4.1004  Establishing subline items.

    Subline items may be used to facilitate tracking of performance, 
deliverables, payment, and contract funds accounting or for other 
management purposes. Subline items may be either deliverable or 
informational. The list of characteristics at 4.1003 applies to 
deliverable subline items, but it is not applicable to informational 
subline items. A line item with subline items shall contain only that 
information that is common to all subline items thereunder. All subline 
items under one line item shall be the same contract type as the line 
item.
    (a) Deliverable subline items. Deliverable subline items may be 
used for several related items that require separate identification. 
For example, instead of establishing multiple separate line items, 
subline items may be established for--
    (1) Items that are basically the same, except for minor variations 
such as--
    (i) Size or color;
    (ii) Accounting classification, but see also 4.1005-1(a)(4); or
    (iii) Date of delivery, destination, or period or place of 
performance;
    (2) Separately priced collateral functions that relate to the 
primary product, such as packaging and handling, or transportation; or
    (3) Items to be separately identified at the time of shipment or 
performance.
    (b) Informational subline items. (1) Informational subline items 
may be used by agencies for administrative purposes. This type of 
subline item identifies information that relates directly to the line 
item and is an integral part of it (e.g., parts of an assembly or parts 
of a kit).
    (2) Position informational subline items within the line item 
description, not in the quantity or price fields.


4.1005  Data elements for line items and subline items.


4.1005-1  Required data elements.

    (a) Except as provided in 4.1005-2, each line item or subline item 
shall include in the schedule (described at 12.303(b)(4), 14.201-2, or 
15.204-2, or in a comparable section of the procurement instrument), at 
a minimum, the following information as separate, distinct data 
elements:
    (1) Line item or subline item number established in accordance with 
agency procedures.
    (2) Description of what is being purchased.
    (3) Product or Service Code (PSC).
    (4) Accounting classification citation.
    (i) Line items or deliverable subline items. If multiple accounting 
classifications for a single deliverable apply, include the dollar 
amount for each accounting classification in the schedule (or a 
comparable section of the procurement instrument).
    (ii) Informational subline items. An accounting classification 
citation is not required. (See 4.1004).
    (5)(i) For fixed-price line items:
    (A) Unit of measure.
    (B) Quantity.
    (C) Unit price.
    (D) Total price.
    (ii) For cost-reimbursement line items:
    (A) Unit of measure.
    (B) Quantity.
    (C) Estimated cost.
    (D) Fee (if any).
    (E) Total estimated cost plus any fee.
    (b) If a contract contains a combination of fixed-price, time-and-
materials, labor-hour, or cost-reimbursable line items, identify the 
contract type for each line item in the schedule (or a comparable 
section of the procurement instrument) to facilitate payment.
    (c) Each deliverable line item or deliverable subline item shall 
have its own delivery schedule, destination, period of performance, or 
place of performance expressly stated in the appropriate section of the 
procurement instrument (``as required'' constitutes an expressly stated 
delivery term). When a line item has deliverable subline items, the 
delivery schedule, destination, period of performance, or place of 
performance shall be identified at the subline item level, rather than 
the line item level.
    (d) Terms and conditions in other sections of the contract (such as 
contract clauses or payment instructions) shall also specify 
applicability to individual line items if not applicable to the 
contract as a whole.


4.1005-2  Exceptions.

    (a) Indefinite-delivery contracts--(1) General. The following 
required data elements are not known at time of issuance of an 
indefinite-delivery contract, but shall be provided in each order at 
the time of issuance: Accounting classification, delivery date and 
destination, or period and place of performance.
    (2) Indefinite-delivery indefinite-quantity (IDIQ) and requirements 
contracts. IDIQ and requirements contracts may omit the quantity at the 
line item level for the base award provided that the total contract 
minimum and maximum, or the estimate, respectively, is stated.
    (b) Item description and PSC. These data elements are not required 
in the line item if there are associated deliverable subline items that 
include the actual detailed identification. When this exception 
applies, use a general narrative description for the line item.
    (c) Single unit price or single total price. The requirement for a 
single unit price or single total price at the line item level does not 
apply if any of the following conditions are present:
    (1) There are associated deliverable subline items that are priced.
    (2) The line item or subline item is not separately priced.
    (3) The supplies or services are being acquired on a cost-
reimbursement, time-and-materials, or labor-hour basis.
    (4) The procurement instrument is for services and firm prices have 
been established for elements of the total price, but the actual number 
of the elements is not known until performance (e.g., a labor-hour 
contract for maintenance/repair). The contracting officer may structure 
these procurement instruments to reflect a firm or estimated total 
amount for each line item.


4.1006  Modifications.

    (a) When a new item (such as an increased quantity) is added to the 
procurement instrument, assign a new line item number.
    (b) If the modification relates to existing line items, the 
modification shall refer to those items.


4.1007  Solicitation alternative line item proposal.

    Solicitations should be structured to allow offerors to propose 
alternative line items (see 4.1008 and 52.212-1(e)). For example, when 
soliciting certain items using units of measure such as kit, set,

[[Page 4713]]

or lot, the offeror may not be able to group and deliver all items in a 
single shipment.


4.1008  Solicitation provision.

    Insert the provision at 52.204-22, Alternative Line Item Proposal, 
in all solicitations.

PART 5--PUBLICIZING CONTRACT ACTIONS


5.207  [Amended]

0
5. Amend section 5.207 by removing from paragraph (a)(13) the word 
``Contract''.

PART 7--ACQUISITION PLANNING

0
6. Amend section 7.105 by revising paragraph (b)(5)(iv) to read as 
follows:


7.105  Contents of written acquisition plans.

* * * * *
    (b) * * *
    (5) * * *
    (iv) For each contract (and order) contemplated, discuss the 
strategy to transition to firm-fixed-price contracts to the maximum 
extent practicable. During the requirements development stage, consider 
structuring the contract requirements, i.e., line items, in a manner 
that will permit some, if not all, of the requirements to be awarded on 
a firm-fixed-price basis, either in the current contract, future option 
years, or follow-on contracts. This will facilitate an easier 
transition to a firm-fixed-price contract, because a cost history will 
be developed for a recurring definitive requirement.
* * * * *

PART 8--REQUIRED SOURCES OF SUPPLIES AND SERVICES

0
7. Amend section 8.402 by revising paragraph (f)(3) to read as follows:


8.402  General.

* * * * *
    (f) * * *
    (3) The items are clearly labeled on the order as items not on the 
Federal Supply Schedule and they conform to the rules for numbering 
line items at subpart 4.10; and
* * * * *

0
8. Amend section 8.404 by adding paragraph (j) to read as follows:


8.404  Use of Federal Supply Schedules.

* * * * *
    (j) Line items. When placing orders or establishing BPAs, ordering 
activities shall reference the special item number and the 
corresponding line or subline item awarded (established per 4.1005) in 
the schedule. If an ordering activity contracting officer adds an item 
not on the Federal Supply Schedule in accordance with 8.402(f), 
establish a new line item in accordance with subpart 4.10.

0
9. Amend section 8.406-1 by--
0
a. Redesignating paragraphs (d)(8) through (16) as paragraphs (d)(9) 
through (17), respectively; and
0
b. Adding a new paragraph (d)(8).
    The addition reads as follows:


8.406-1  Order placement.

* * * * *
    (d) * * *
    (8) Line item or subline item.
* * * * *

0
10. Amend section 8.406-4 by revising paragraph (c)(3)(i)(C) to read as 
follows:


8.406-4  Termination for cause.

* * * * *
    (c) * * *
    (3) * * *
    (i) * * *
    (C) Line item number(s) and a brief description of the item(s).
* * * * *

PART 9--CONTRACTOR QUALIFICATIONS


9.307  [Amended]

0
11. Amend section 9.307 by removing from third sentence of paragraph 
(b) ``contract line item number'' and adding ``line item number'' in 
its place.

PART 12--ACQUISITION OF COMMERCIAL ITEMS


12.303  [Amended]

0
12. Amend section 12.303 by removing from paragraph (b)(3) the word 
``contract''.

0
13. Amend section 12.603 by revising paragraph (c)(2)(v) to read as 
follows:


12.603  Streamlined solicitation for commercial items.

* * * * *
    (c) * * *
    (2) * * *
    (v) A list of line item number(s) and items, quantities, and units 
of measure (including option(s), if applicable).
* * * * *

PART 14--SEALED BIDDING

0
14. Amend section 14.201--2 by revising the first sentence of paragraph 
(b) to read as follows:


14.201-2  Part I--The Schedule.

* * * * *
    (b) * * * Include a brief description of the supplies or services; 
e.g., line item number, national stock number/part number if 
applicable, title or name identifying the supplies or services, and 
quantities (see part 11). * * *
* * * * *

0
15. Amend section 14.201-9 by revising paragraphs (b) introductory text 
and (b)(1) to read as follows:


14.201-9  Simplified contract format.

* * * * *
    (b) Contract schedule. Include the following for each line item:
    (1) Line item number.
* * * * *

PART 15--CONTRACTING BY NEGOTIATION

0
16. Amend section 15.203 by revising paragraph (a)(2) to read as 
follows:


15.203  Requests for proposals.

    (a) * * *
    (2) Anticipated terms and conditions that will apply to the 
contract. The solicitation may authorize offerors to propose 
alternative terms and conditions. If the solicitation permits offerors 
to submit one or more additional proposals with alternative line items 
(see 52.204-22 or 52.212-1(e)), the evaluation approach should consider 
the potential impact of the alternative line items on other terms and 
conditions or the requirement (e.g., place of performance or payment 
and funding requirements) (see 15.206);
* * * * *

0
17. Amend section 15.404-1 by revising the second sentence of paragraph 
(g)(1) to read as follows:


15.404-1  Proposal analysis techniques.

* * * * *
    (g) * * *
    (1) * * * Unbalanced pricing exists when, despite an acceptable 
total evaluated price, the price of one or more line items is 
significantly over or understated as indicated by the application of 
cost or price analysis techniques. * * *
* * * * *

0
18. Amend section 15.408 in Table 15-2 by--
0
a. Under the heading I. General Instructions, revising the first 
sentence of paragraph D. and removing from paragraph E. the word 
``contract''; and
0
b. Under the heading II. Cost Elements, removing from the first 
sentence of paragraph A. the word ``contract''.
    The revision reads as follows:


15.408  Solicitation provisions and contract clauses.

* * * * *

[[Page 4714]]

Table 15-2--Instructions for Submitting Cost/Price Proposals When 
Certified Cost or Pricing Data Are Required

* * * * *

I. General Instructions

* * * * *
    D. You must show the relationship between line item prices and the 
total contract price. * * *
* * * * *

PART 16--TYPES OF CONTRACTS


16.203-4  [Amended]

0
19. Amend section 16.203-4 by removing from paragraph (b)(4) ``contract 
line items'' and adding ``line items'' in its place.

0
20. Amend section 16.505 by revising paragraph (a)(7)(iii) to read as 
follows:


16.505  Ordering.

    (a) * * *
    (7) * * *
    (iii) For supplies and services, line item number, subline item 
number (if applicable), description, quantity, and unit price or 
estimated cost and fee (as applicable). The corresponding line item 
number and subline item number from the base contract shall also be 
included.
* * * * *

PART 17--SPECIAL CONTRACTING METHODS


17.106-1  [Amended]

0
21. Amend section 17.106-1 by removing from the fifth sentence of 
paragraph (c)(1), ``Table 15-2, Formats for Submission of Line Items'' 
and adding ``Table 15-2, III. Formats for Submission of Line Item'' in 
its place.


17.203  [Amended]

0
22. Amend section 17.203 by removing from paragraph (g)(2) ``contract 
line item'' and adding ``line item'' in its place.


17.208  [Amended]

0
23. Amend section 17.208 by removing from paragraph (e) ``basic 
contract line item'' and adding ``line item'' in its place.

PART 27--PATENTS, DATA, AND COPYRIGHTS


27.406-1   [Amended]

0
24. Amend section 27.406-1 by removing from the second sentence of 
paragraph (b) ``contract line items'' and adding ``line items'' in its 
place.

PART 32--CONTRACT FINANCING


32.903   [Amended]

0
25. Amend section 32.903 by removing from paragraph (b) introductory 
text ``contract line item'' and adding ``line item'' in its place.


32.905   [Amended]

0
26. Amend section 32.905 by removing from paragraph (b)(1)(iii) 
``contract line item'' and adding ``line item'' in its place.


32.1004   [Amended]

0
27. Amend section 32.1004 by removing from the introductory text and 
paragraph (a)(2)(v) ``contract line item'' and adding ``line item'' in 
their places (three times).


32.1110   [Amended]

0
28. Amend section 32.1110 by removing from paragraph (f) ``contract 
line item'' and adding ``line item'' in its place.

PART 42--CONTRACT ADMINISTRATION AND AUDIT SERVICES


42.302   [Amended]

0
29. Amend section 42.302 by removing from paragraph (b)(9) ``contract 
line item'' and adding ``line item'' in its place.

PART 48--VALUE ENGINEERING


48.104-2   [Amended]

0
30. Amend section 48.104-2 by removing from paragraph (a)(4) ``contract 
line item'' and adding ``line item'' in its place.

PART 49--TERMINATION OF CONTRACTS


49.601-2   [Amended]

0
31. Amend section 49.601-2 by removing from the introductory text of 
the Notice of Termination to Prime Contractors ``items, etc.'' and 
adding ``line items, etc.'' in its place.


49.603-2   [Amended]

0
32. Amend section 49.603-2 by removing from paragraph (b)(1) ``(i) 
item'' and adding ``(i) line item'' in its place.


49.603-5   [Amended]

0
33. Amend section 49.603-5 by removing from paragraph (b)(1) ``(i) 
item'' and adding ``(i) line item'' in its place.


49.603-7   [Amended]

0
34. Amend section 49.603-7 by removing from paragraph (b)(1) ``(i) 
item'' and adding ``(i) line item'' in its place.

PART 52--SOLICITATION PROVISIONS AND CONTRACT CLAUSES

0
35. Add section 52.204-22 to read as follows:


52.204-22   Alternative Line Item Proposal.

    As prescribed in 4.1008, insert the following provision:

Alternative Line Item Proposal (JAN 2017)

    (a) The Government recognizes that the line items established in 
this solicitation may not conform to the Offeror's practices. 
Failure to correct these issues can result in difficulties in 
acceptance of deliverables and processing payments. Therefore, the 
Offeror is invited to propose alternative line items for which bids, 
proposals, or quotes are requested in this solicitation to ensure 
that the resulting contract is economically and administratively 
advantageous to the Government and the Offeror.
    (b) The Offeror may submit one or more additional proposals with 
alternative line items, provided that alternative line items are 
consistent with subpart 4.10 of the Federal Acquisition Regulation. 
However, acceptance of an alternative proposal is a unilateral 
decision made solely at the discretion of the Government. Offers 
that do not comply with the line items specified in this 
solicitation may be determined to be nonresponsive or unacceptable.


(End of provision)

0
36. Amend section 52.212-1 by revising the date of the provision and 
paragraph (e) to read as follows:


52.212-1   Instructions to Offerors--Commercial Items.

* * * * *

Instructions to Offerors--Commercial Items (JAN 2017)

* * * * *
    (e) Multiple offers. Offerors are encouraged to submit multiple 
offers presenting alternative terms and conditions, including 
alternative line items (provided that the alternative line items are 
consistent with subpart 4.10 of the Federal Acquisition Regulation), or 
alternative commercial items for satisfying the requirements of this 
solicitation. Each offer submitted will be evaluated separately.
* * * * *

0
37. Amend section 52.212-4 by--
0
a. Revising the date of the clause;
0
b. Removing from paragraph (g)(1)(iii) ``contract line item'' and 
adding ``line item'' in its place;
0
c. Removing from paragraph (i)(5)(i)(C) the word ``contract''; and
0
d. In Alternate I--
0
1. Revising the date of Alternate I; and
0
2. Removing from paragraph (i)(5)(i)(C) the word ``contract''.
    The revisions read as follows:

[[Page 4715]]

52.212-4   Contract Terms and Conditions--Commercial Items.

* * * * *

Contract Terms and Conditions--Commercial Items (JAN 2017)

* * * * *
    Alternate I (JAN 2017)* * *
* * * * *

0
38. Amend section 52.212-5 by revising the date of the clause and 
paragraph (b)(55) to read as follows:


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

* * * * *

Contract Terms and Conditions Required To Implement Statutes or 
Executive Orders--Commercial Items (JAN 2017)

* * * * *
    (b) * * *
    __(55) 52.232-30, Installment Payments for Commercial Items (JAN 
2017) (41 U.S.C. 4505, 10 U.S.C. 2307(f)).
* * * * *

0
39. Amend section 52.213-4 by revising the date of the clause and 
paragraph (a)(2)(iv) to read as follows:


52.213-4   Terms and Conditions--Simplified Acquisitions (Other Than 
Commercial Items).

* * * * *

Terms and Conditions--Simplified Acquisitions (Other than Commercial 
Items (JAN 2017)

* * * * *
    (a) * * *
    (2) * * *
    (iv) 52.232-25, Prompt Payment (JAN 2017)
* * * * *

0
40. Amend section 52.214-21 in Alternate I by revising the date of the 
alternate and removing from paragraph (f) ``Contract line'' and adding 
``Line'' in its place to read as follows:


52.214-21   Descriptive Literature.

* * * * *
    Alternate I (JAN 2017)* * *
* * * * *

0
41. Amend section 52.215-1 by revising the date of the provision and 
removing from the second sentence of paragraph (f)(8) the word 
``contract'' to read as follows:


52.215-1   Instructions to Offerors--Competitive Acquisition.

* * * * *

Instructions to Offerors--Competitive Acquisition (JAN 2017)

* * * * *

0
42. Amend section 52.216-4 by revising the date of the clause and 
removing from the second sentence of paragraph (c)(3) the word 
``contract'' to read as follows:


52.216-4   Economic Price Adjustment--Labor and Material.

* * * * *

Economic Price Adjustment--Labor and Material (JAN 2017)

* * * * *

0
43. Amend section 52.222-32 by revising the date of the clause and 
removing from the fourth sentence of paragraph (f)(2) ``contract line 
item'' and adding ``line item'' in its place'' to read as follows:


52.222-32   Construction Wage Rate Requirements--Price Adjustment 
(Actual Method).

* * * * *

Construction Wage Rate Requirements--Price Adjustment (Actual Method) 
(JAN 2017)

* * * * *

0
44. Amend section 52.232-25 by--
0
a. Revising the date of the clause;
0
b. Removing from paragraph (a)(3)(iii) ``contract line item'' and 
adding ``line item'' in its place; and
0
c. Removing from paragraph (d)(1)(iii) ``contract line item'' and 
adding ``line item'' in its place.
    The revision reads as follows:


52.232-25   Prompt Payment.

* * * * *

Prompt Payment (JAN 2017)

* * * * *

0
45. Amend section 52.232-26 by--
0
a. Revising the section heading and the date of the clause;
0
b. Removing from paragraph (a)(2)(iii) ``contract line item'' and 
adding ``line item'' in its place; and
0
c. Removing from paragraph (c)(1)(iii) ``contract line item'' and 
adding ``line item'' in its place.
    The revision reads as follows:


52.232-26   Prompt Payment for Fixed-Price Architect-Engineer 
Contracts.

* * * * *

Prompt Payment for Fixed-Price Architect-Engineer Contracts (JAN 2017)

* * * * *

0
46. Amend section 52.232-27 by--
0
a. Revising the section heading and the date of the clause;
0
b. Removing from paragraph (a)(2)(iii) ``contract line item'' and 
adding ``line item'' in its place; and
0
c. Removing from paragraph (l)(1)(iii) ``contract line item'' and 
adding ``line item'' in its place.
    The revision reads as follows:


52.232-27   Prompt Payment for Construction Contracts.

* * * * *

Prompt Payment for Construction Contracts (JAN 2017)

* * * * *

0
47. Amend section 52.232-30 by--
0
a. Revising the date of the clause;
0
b. Removing from paragraph (b) introductory text ``contract line item'' 
and adding ``line item'' in its place;
0
c. Removing from paragraph (b)(1) ``contract line item'' and adding 
``line item'' in their places (six times);
0
d. Removing from paragraph (b)(2) ``contract line item'' and adding 
``line item'' in its place;
0
e. Removing from paragraph (b)(3) ``contract line item'' and adding 
``line item'' in their places (three times);
0
f. Removing from paragraph (b)(4) ``contract line item'' and adding 
``line item'' in its place;
0
g. Removing from paragraph (e) ``contract line item'' and adding ``line 
item'' in its place; and
0
h. Removing from paragraph (i)(4) ``contract line item'' and adding 
``line item'' in its place;
    The revision reads as follows:


52.232-30   Installment Payments for Commercial Items.

* * * * *

Installment Payments for Commercial Items (JAN 2017)

* * * * *

0
48. Amend section 52.243-7 by revising the date of the clause and 
removing from paragraph (b)(5)(i) ``contract line items'' and adding 
``line items'' in its place to read as follows:


52.243-7   Notification of Changes.

* * * * *

Notification of Changes (JAN 2017)

* * * * *

0
49. Amend section 52.245-1 by revising the date of the clause and 
removing from paragraph (e)(3) ``contract line items'' and adding 
``line items'' in its place to read as follows:


52.245-1   Government Property.

* * * * *

Government Property (JAN 2017)

* * * * *

0
50. Amend section 52.247-60 by revising the date of the clause and 
adding a sentence to the end of paragraph (a)(1)(xi) to read as 
follows:

[[Page 4716]]

52.247-60   Guaranteed Shipping Characteristics.

* * * * *

Guaranteed Shipping Characteristics (JAN 2017)

    (a) * * *
    (1) * * *
    (xi) * * *
    Number of complete units (line item) to be shipped in carrier's 
equipment.
* * * * *

0
51. Amend section 52.248-1 in Alternate II by revising the date of the 
alternate and removing from paragraph (a) ``contract line items'' and 
adding ``line items'' in its place to read as follows:


52.248-1   Value Engineering.

* * * * *
    Alternate II (JAN 2017) * * *
* * * * *
[FR Doc. 2016-31495 Filed 1-12-17; 8:45 am]
 BILLING CODE 6820-EP-P