[Federal Register Volume 83, Number 185 (Monday, September 24, 2018)]
[Rules and Regulations]
[Pages 48257-48263]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2018-20323]


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DEPARTMENT OF VETERANS AFFAIRS

48 CFR Parts 829, 846, 847, 852, and 870

RIN 2900-AQ04


VA Acquisition Regulation: Taxes; Quality Assurance; 
Transportation; Solicitation Provisions and Contract Clauses; and 
Special Procurement Controls

AGENCY: Department of Veterans Affairs.

ACTION: Final rule.

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SUMMARY: The Department of Veterans Affairs (VA) is amending and 
updating its VA Acquisition Regulation (VAAR) in phased increments to 
revise or remove any policy superseded by changes in the Federal 
Acquisition Regulation (FAR), to remove procedural guidance internal to 
VA into the VA Acquisition Manual (VAAM), and to incorporate any new 
agency specific regulations or policies. These changes seek to 
streamline and align the VAAR with the FAR and remove outdated and 
duplicative requirements and reduce burden on contractors. The VAAM 
incorporates portions of the removed VAAR as well as other internal 
agency acquisition policy. VA will rewrite certain parts of the VAAR 
and VAAM, and as VAAR parts are rewritten, we will publish them in the 
Federal Register. In particular, this rulemaking revises VAAR 
concerning Taxes; Quality Assurance; Transportation; Solicitation 
Provisions and Contract Clauses; and Special Procurement Controls.

DATES: This rule is effective on October 24, 2018.

FOR FURTHER INFORMATION CONTACT: Mr. Rafael N. Taylor, Senior 
Procurement Analyst, Procurement Policy and Warrant Management 
Services, 003A2A, 425 I Street NW, Washington, DC 20001, (202) 382-
2787. (This is not a toll-free number.)

SUPPLEMENTARY INFORMATION: On April 25, 2018, VA published a proposed 
rule in the Federal Register (83 FR 17979) which announced VA's intent 
to amend regulations for VAAR Case RIN 2900-AQ04 (parts 829, 846, and 
847). In particular, this final rule revises the 829 authorities to 
include the applicable U.S. code citations where the Secretary of the 
Treasury has exempted spirits and alcohol purchases by the Federal 
government, pursuant to 26 U.S.C. 5214(a)(2), 26 U.S.C. 5271, and 26 
U.S.C. 7510; removes section 829.202-70, Tax exemptions for alcohol 
products, updates and moves it to the VAAM; adds a new section to 
provide the legislative authorities for withdrawal of distilled spirits 
from bonded premises free of tax or without payment of tax by, and for 
the use of, the VA; removes section 829.302, Application of State and 
local taxes to the Government, to the VAAM; removes 829.302-70, 
Purchases made from patients' funds, and the clause it prescribes, 
852.229-70, Sales or Use Taxes.
    In part 846, Quality Assurance, this rule adds a definition of 
``rejected goods'' as used in a revised clause; revises subpart 846.3 
to prescribe clauses 852.236-74, Inspection of Construction, 852.246-
71, Rejected Goods, 852.246-72, Frozen Processed Foods, 852.246-73, 
Noncompliance with Packaging, Packing, and/or Marking Requirements, and 
852.246-76, Purchase of Shellfish; it reduces subpart 846.4 to three 
sections, 846.408-70, Inspection of subsistence, 846.470, Use of 
commercial organizations for inspections and grading services, and 
846.471, Food service equipment; it removes a warranty clause because 
there are sufficient FAR warranty clauses that could be used; removes 
policy requiring USDA inspections for subsistence since the Department 
of Agriculture no longer requires this type of inspection; removes 
coverage requiring inspection of repairs for properties under the Loan 
Guaranty Program and Direct Loan Programs, as such sections are 
unnecessary given that a private contractor performs such inspection 
and repair functions on VA's behalf; and provides coverage to state 
VA's policy regarding guarantee period services.
    This rule adds guidance in part 847 to contracting officers for VA 
transportation contracts and transportation-related services and 
subsequent payments on those contracts; provides guidance on 
contractual requirements for insurance provisions and contractor 
personnel performing on VA transportation contracts; provides 
consignment instructions; and adds a clause providing packing 
instructions to ensure acceptance by common carriers and safe delivery 
at destination.
    This rule also removes all remaining sections of part 870 as the 
guidance included therein was either moved to other parts, out of date, 
or duplicative of the FAR.
    VA provided a 60-day comment period for the public to respond to 
the proposed rule. The comment period for the proposed rule ended on 
June 25, 2018 and VA received no comments. This document adopts as a 
final rule the proposed rule published in the Federal

[[Page 48258]]

Register on April 25, 2018, with minor formatting and/or grammatical 
edits. This final rule has Federal Register administrative format 
changes in the amendatory text which make no substantive text changes 
at the affected sections.

Unfunded Mandates

    The Unfunded Mandates Reform Act of 1995 requires, at 2 U.S.C. 
1532, that agencies prepare an assessment of anticipated costs and 
benefits before issuing any rule that may result in the expenditure by 
State, local, and tribal Governments, in the aggregate, or by the 
private sector, of $100 million or more (adjusted annually for 
inflation) in any one year. This final rule will have no such effect on 
State, local, and tribal Governments or on the private sector.

Paperwork Reduction Act

    This final rule contains no provisions constituting a collection of 
information under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-
3521).

Regulatory Flexibility Act

    This final rule will not have a significant economic impact on a 
substantial number of small entities as they are defined in the 
Regulatory Flexibility Act, 5 U.S.C. 601-612. This final rule will 
generally be small business neutral. The overall impact of the rule 
will be of benefit to small businesses owned by Veterans or service-
disabled Veterans as the VAAR is being updated to remove extraneous 
procedural information that applies only to VA's internal operating 
procedures. VA is merely adding existing and current regulatory 
requirements to the VAAR and removing any guidance that is applicable 
only to VA's internal operation processes or procedures. VA estimates 
no cost impact to individual businesses will result from these rule 
updates. This rulemaking does not change VA's policy regarding small 
businesses, does not have an economic impact to individual businesses, 
and there are no increased or decreased costs to small business 
entities. On this basis, the final rule will not have an economic 
impact on a substantial number of small entities as they are defined in 
the Regulatory Flexibility Act, 5 U.S.C. 601-612. Therefore, under 5 
U.S.C. 605(b), this regulatory action is exempt from the initial and 
final regulatory flexibility analysis requirements of sections 603 and 
604.

Executive Orders 12866, 13563 and 13771

    Executive Orders (E.O.) 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. 
E.O. 12866, Regulatory Planning and Review defines ``significant 
regulatory action'' to mean any regulatory action that is likely to 
result in a rule that may: ``(1) Have an annual effect on the economy 
of $100 million or more or adversely affect in a material way the 
economy, a sector of the economy, productivity, competition, jobs, the 
environment, public health or safety, or State, local, or tribal 
governments or communities; (2) Create a serious inconsistency or 
otherwise interfere with an action taken or planned by another agency; 
(3) Materially alter the budgetary impact of entitlements, grants, user 
fees, or loan programs or the rights and obligations of recipients 
thereof; or (4) Raise novel legal or policy issues arising out of legal 
mandates, the President's priorities, or the principles set forth in 
this Executive order.''
    VA has examined the economic, interagency, budgetary, legal, and 
policy implications of this regulatory action, and it has been 
determined not be a significant regulatory action under E.O. 12866 
because it does not raise novel legal or policy issues arising out of 
legal mandates, the President's priorities, or the principles set forth 
in this Executive Order.
    VA's impact analysis can be found as a supporting document at 
http://www.regulations.gov, usually within 48 hours after the 
rulemaking document is published. Additionally, a copy of the 
rulemaking and its impact analysis are available on VA's website at 
http://www.va.gov/orpm by following the link for VA Regulations 
Published from FY 2004 Through Fiscal Year to Date. This final rule is 
not subject to the requirements of E.O. 13771 because this final rule 
is expected to result in no more than de minimis costs.

List of Subjects

48 CFR Part 829

    Government procurement, Taxes.

48 CFR Part 846

    Government procurement.

48 CFR Part 847

    Government procurement, Transportation.

48 CFR Part 852

    Government procurement, Reporting and recordkeeping requirements.

48 CFR Part 870

    Asbestos, Frozen foods, Government procurement, Telecommunications.

Signing Authority

    The Secretary of Veterans Affairs approved this document and 
authorized the undersigned to sign and submit the document to the 
Office of the Federal Register for publication electronically as an 
official document of the Department of Veterans Affairs. Robert L. 
Wilkie, Secretary, Department of Veterans Affairs, approved this 
document on August 24, 2018, for publication.

    Dated: September 14, 2018.
Consuela Benjamin,
Regulations Development Coordinator, Office of Regulation Policy & 
Management, Office of the Secretary, Department of Veterans Affairs.

    For the reasons set out in the preamble, VA amends 48 CFR parts 
829, 846, 847, 852, and 870 as follows:

PART 829--TAXES

0
1. The authority citation for part 829 is revised to read as follows:

    Authority: 26 U.S.C. 5214(a)(2), 5271, 7510; 40 U.S.C. 121(c); 
41 U.S.C. 1303(a)(2); 41 U.S.C. 1702 and 48 CFR 1.301-1.304.


0
2. Subpart 829.2 is revised to read as follows:

Subpart 829.2--Federal Excise Taxes


829.203  Other Federal tax exemptions.


829.203-70  Tax exemptions for alcohol products.

    (a) General. (1) Pursuant to 26 U.S.C. 5214(a)(2) and 26 U.S.C. 
5271, VA may purchase spirits using a tax exemption as provided by 
Department of the Treasury, Alcohol and Tobacco Tax and Trade Bureau 
(TTB) regulations (see 27 CFR parts 1 through 39). As stated in 27 CFR 
19.426, agencies of the United States Government that wish to obtain 
either specially denatured spirits or spirits free of tax for 
nonbeverage purposes must apply for and receive a permit on form TTB F 
5150.33 or must have a previously issued permit on ATF Form 1444.
    (2) When purchasing spirits under a tax exemption, the contracting 
officer

[[Page 48259]]

shall indicate in the contract document the basis for the exemption and 
make a copy of the permit available to the contractor. Upon receipt of 
the spirits, the contractor shall return the permit to the contracting 
officer unless future orders are anticipated or as directed by the 
contracting officer.
    (3) Department of Veterans Affairs activities that require spirits 
free of tax for beverage purposes under 26 U.S.C. 7510 must provide a 
proper purchase order signed by the head of the agency or an authorized 
designee.
    (b) Specially denatured spirits or spirits free of tax for 
nonbeverage purposes. Contracting officers may make purchases of excise 
tax-free spirits, including denatured alcohol and specially denatured 
alcohol only from qualified distillery plants or bonded dealers.
    (1) Permits previously issued on Alcohol, Tobacco, and Firearms 
(ATF) Form 1444, Tax-Free Spirits for Use of United States, remain 
valid until surrendered or cancelled.
    (2) A copy of the current ATF Form 1444 or TTB Form 5150.33 shall 
be made available to the supplier with the initial order. The permit 
number only needs to be referenced on any future orders with the same 
supplier.
    (c) Wine. No tax exemption form or ATF/TTB permit is required for 
the tax-free procurement of wine from bonded wine premises. The 
purchase order must show the kind, quantity, and alcohol content of the 
wine and must state the purpose for which wine is to be used (see 27 
CFR 24.293). An extra copy of a properly executed purchase order may be 
furnished to the bonded wine premises from which wine is purchased to 
facilitate record keeping. The order must be signed by the head of the 
contracting activity or their designee.

0
3. Subpart 829.3 is revised to read as follows:

Subpart 829.3--State and Local Taxes


829.303  Application of State and local taxes to Government contractors 
and subcontractors.

    (a) The authority to make the determination prescribed in FAR 
29.303(a) is delegated, without power of redelegation, to the head of 
the contracting activity (HCA).

PART 846--QUALITY ASSURANCE

0
4. The authority citation for part 846 is revised to read as follows:

    Authority: 40 U.S.C. 121(c); 41 U.S.C. 1303; 41 U.S.C. 1702; and 
48 CFR 1.301-1.304.


0
5. Subpart 846.1 is added to read as follows:

Subpart 846.1--General


846.101  Definition.

    As used in this part--
    Rejected goods means supplies and/or equipment failing to meet 
contractual terms and conditions and/or generally accepted quality 
standards that may be returned by the Government at the contractor's 
risk and expense.

0
6. Subpart 846.3 is revised to read as follows:
Subpart 846.3--Contract Clauses
Sec.
846.312 Construction contracts.
846.370 Clauses for supplies, equipment or perishable goods.
846.370-1 Rejected goods.
846.370-2 Frozen processed foods.
846.370-3 Noncompliance with packaging, packing, and/or marking 
requirements.
846.370-4 Purchase of shellfish.

Subpart 846.3--Contract Clauses


846.312  Construction contracts.

    The contracting officer shall insert the clause at 852.236-74, 
Inspection of Construction, in solicitations and contracts for 
construction that include the FAR clause at 52.246-12, Inspection of 
Construction.


846.370  Clauses for supplies, equipment or perishable goods.


846.370-1  Rejected goods.

    The contracting officer shall insert the clause at 852.246-71, 
Rejected Goods, in solicitations and contracts for the acquisition of 
supplies, equipment or perishable goods. Perishable goods include such 
items as packing house and dairy products, bread and bakery products, 
fresh and frozen fruits, and vegetables.


846.370-2  Frozen processed foods.

    (a) The contracting officer shall insert the clause at 852.246-72, 
Frozen Processed Foods, in solicitations and contracts for frozen 
processed foods.
    (b) The following frozen processed food products must contain a 
label that complies with the Federal Food, Drug and Cosmetic Act (21 
U.S.C. 301), which requires all ingredients be listed in accordance 
with their predominance order:
    (1) Frozen processed food products that contain meat, poultry, or a 
significant proportion of eggs.
    (2) Frozen processed food products that contain fish or fish 
products.
    (3) Frozen bakery products.
    (c) All procured frozen processed food products that contain meat, 
poultry or a significant proportion of eggs must meet the following 
requirements:
    (1) The products must be processed or prepared in plants operating 
under the supervision of the Department of Agriculture (USDA).
    (2) The product must be inspected and approved in accordance with 
USDA regulations governing meat, poultry, or egg inspection. A label or 
seal that indicates compliance with USDA regulations, affixed to the 
container, will be accepted as evidence of compliance.
    (d) All procured frozen processed food products that contain fish 
or fish products must meet the following requirements:
    (1) The product must be processed or prepared in plants or vessels, 
sanitarily inspected, approved, and certified by the United States 
Department of Commerce (USDC). The products are listed in USDC's 
publication ``USDC Approved Establishments'' under U.S. Establishments 
Approved for Sanitation and for Producing USDC Inspected Fishery 
Products. The inspected products packed under various labels bearing 
the brand names are produced in accordance with current U.S. Grade 
Standards or official product specifications, packed under optimum 
hygienic conditions, and must meet Federal, State, and city sanitation 
and health regulations. Such brand label or USDC seal indicating 
compliance with USDC regulations, affixed to a container, will be 
accepted as evidence of compliance.
    (2) If the conditions in paragraph (d)(1) of this section were not 
met (e.g., no seal), the shipment may be lot-inspected by the USDC and 
containers stamped to indicate acceptance or a Certification of 
Inspection issued to accompany the shipment.
    (e) Producers of frozen bakery products that ship products in 
interstate commerce are required to comply with the Federal Food, Drug 
and Cosmetic Act. Therefore, the product must be verified as shipped 
interstate or that the producer ships products to other purchasers 
interstate.


846.370-3   Noncompliance with packaging, packing, and/or marking 
requirements.

    The contracting officer shall insert the clause at 852.246-73, 
Noncompliance with Packaging, Packing, and/or Marking Requirements, in 
non-commercial item solicitations and contracts for supplies or 
equipment where there are special packaging, packing and/or marking 
requirements. The clause may be used in commercial item acquisitions if 
a waiver is approved in accordance with FAR 12.302(c).

[[Page 48260]]

846.370-4  Purchase of shellfish.

    (a) The U.S. Food and Drug Administration (FDA) at http://www.fda.gov provides quality assurance seafood safety guidelines.
    (b) The contracting officer shall insert the clause at 852.246-76, 
Purchase of Shellfish, in solicitations and contracts for shellfish.

0
7. Subpart 846.4 is revised to read as follows:
Subpart 846.4--Government Contract Quality Assurance
Sec.
846.408-70 Inspection of subsistence.
846.470 Use of commercial organizations for inspections and grading 
services.
846.471 Food service equipment.

Subpart 846.4--Government Contract Quality Assurance


846.408-70   Inspection of subsistence.

    (a) The contracting officer shall indicate the time and place of 
inspection in the solicitation.
    (b) The contracting officer shall also provide in the solicitation 
that the contractor is responsible for all of the following:
    (1) Arranging and paying for inspection services.
    (2) Obtaining from the inspectors a certificate indicating that the 
product complies with specifications.
    (3) Assuring that the certificate, or copy, accompanies the 
shipment.
    (4) Furnishing samples for inspection at the contractor's expense.
    (5) Indicating the address where inspection will occur.
    (c) The contracting officer must furnish a copy of the purchase 
document to the inspecting activity.


846.470   Use of commercial organizations for inspections and grading 
services.

    The contracting officer may use a commercial organization for 
inspection and grading services when the contracting officer determines 
that all of the following exist:
    (a) The results of a technical inspection or grading are dependent 
upon the application of scientific principles or specialized 
techniques.
    (b) VA is unable to employ the personnel qualified to properly 
perform the services and is unable to locate another Federal agency 
capable of providing the service.
    (c) The inspection or grading results issued by a private 
organization are essential to verify the acceptance or rejection of a 
special commodity.
    (d) The services may be performed without direct Government 
supervision.


846.471   Food service equipment.

    (a) All new food service equipment purchased for Dietetic Service 
through other than the Defense General Supply Center sources must meet 
requirements set forth by NSF International (NSF) at http://www.nsf.org.
    (b) The contracting officer will ensure that the following language 
is placed in the solicitation to assert that the equipment meets NSF 
standards:
    The Government will accept an affixed NSF label and/or 
documentation of the NSF Certification from the contractor as evidence 
that the subject equipment meets NSF Sanitation standards.

0
8. Subpart 846.7 is revised to read as follows:

Subpart 846.7--Warranties


846.702-70  Guarantee period services and specifications.

    (a) Guarantee period of services are associated with preserving and 
protecting a specified piece of contractor-installed equipment that is 
guaranteed under a construction contract. Specifications for certain 
high-dollar or traditionally troublesome equipment are designed to 
allow for the original installer of the equipment to service the 
equipment throughout the guaranty period.
    (b) Guarantee period services are not the same as the 1-year 
general construction guaranty clause found at FAR clause 52.246-21, 
Warranty of Construction.
    (c) The contracting officer may determine, when in the best 
interest of VA that guarantee period services, not to exceed a period 
of 5 years, are appropriate to protect the integrity of the installed 
equipment and ensure that the equipment performs as guaranteed.
    (d) When the determination is made under paragraph (c) of this 
section, the contracting officer shall include the guarantee period of 
services as a separately priced contract line item number (CLIN) in 
solicitations and contracts.
    (e) The contracting officer shall insert the clause at 852.246-75, 
Warranty of Construction--Guarantee Period Services, in solicitations 
and contracts for construction that include the FAR clause 52.246-21, 
Warranty of Construction, and that also include guarantee period 
services.
    (f) In accordance with the approved VA specifications, the 
following types of equipment contain the guarantee period services 
specifications. The following represents a sampling of these 
specifications.
    (1) Division 14--Conveying Equipment. (i) Electric Dumbwaiters 
Geared Traction and Winding Drum (VA 14 12 11).
    (ii) Electric Traction Elevators (VA 14 21 00).
    (iii) Traction Cartlift (VA 14 21 11).
    (iv) Hydraulic Elevators (VA 14 24 00).
    (v) Hydraulic Cartlift (VA 14 24 11).
    (2) Division 27--Communications. (i) Public Address and Mass 
Notification Systems (VA 27 51 16).
    (ii) Intercommunication and Program Systems (VA 27 51 23).
    (g) The construction contractor shall require the original 
installer of the equipment, which is normally a subcontractor, to 
provide the guarantee period services.

PART 847--TRANSPORTATION

0
9. The authority citation for part 847 is revised to read as follows:

    Authority:  38 U.S.C. 513; 40 U.S.C. 121(c); 41 U.S.C. 1303; 41 
U.S.C. 1702; 41 CFR part 102-117; and 48 CFR 1.301-1.304.


0
10. Subpart 847.2 is added to read as follows:
Subpart 847.2--Contracts for Transportation or for Transportation-
Related Services
Sec.
847.207 Solicitation provisions, contract clauses, and special 
requirements.
847.207-8 Government responsibilities.
847.207-70 VA solicitation provisions, contract clauses, and special 
requirements.

Subpart 847.2--Contracts for Transportation or for Transportation-
Related Services


847.207   Solicitation provisions, contract clauses, and special 
requirements.


847.207-8  Government responsibilities.

    Transportation payments are audited by the Traffic Manager, to 
ensure that payment and payment mechanisms for agency transportation 
are uniform and appropriate in accordance with 41 CFR part 102-118.


847.207-70   VA solicitation provisions, contract clauses, and special 
requirements.

    (a) Insurance under patient transportation contracts. The 
contracting officer shall ensure that all the proper certificates of 
insurance are submitted to perform on the contract, as outlined in the 
solicitation, and subsequently included in the contract file. In 
accordance with 828.306, the contracting officer shall insert the 
provision at 852.228-71, Indemnification and Insurance, in 
solicitations when utilizing term

[[Page 48261]]

contracts or contracts of a continuing nature for ambulance, automobile 
and aircraft service. When contracting for these services, consider 
using requirements language such as the following:
    (1) Written proof of insurance coverage as required and outlined in 
the solicitation is required prior to award of any contract. Coverage 
must be maintained continually through the life of the contract.
    (2) Within 10 days of notification of acceptance and pending award 
of contract, the contractor shall furnish to the contracting officer a 
certificate of insurance which shall contain an endorsement to the 
effect that cancellation of, or any material change in, the policies 
which adversely affect the interests of the Government in such 
insurance shall not be effective unless a 30-day advance written notice 
of cancellation or change is furnished to the contracting officer.
    (3) Within 10 days of notification of acceptance and pending award 
of contract, and prior to award of a contract, the contractor shall 
furnish to the contracting officer a copy of the contractor's current 
and valid Worker's Compensation certificate.
    (b) Contractor personnel. The contracting officer shall ensure that 
contractor personnel have the appropriate level of training, 
experience, licensure, and pertinent qualifications to ensure patient 
safety. When contracting for these services, consider using 
requirements language such as the following:
    (1) All contractor personnel performing contract services shall 
meet the qualifications as specified in the contract, as well as any 
qualifications required by Federal, State, County, and local Government 
entities from the place in which they operate. Contractor personnel 
shall meet these qualifications at all times while performing contract 
services.
    (2) During the contract period of performance, if the contractor 
proposes to add-on, or replace personnel to perform contract services, 
the contractor shall submit required evidence of training, 
certifications, licensing, background, and security clearances, and any 
other applicable qualifications to the designated contracting officer's 
representative (COR). At no time shall the contractor utilize add-on or 
replacement personnel to perform contract services who do not meet the 
qualifications under the terms and conditions of the contract.
    (3) Records of contractor personnel qualifications and eligibility 
to perform on the contract must be current and maintained throughout 
the life of the contract, and be made available for inspection upon 
request. The contractor shall forward to the contracting officer, on an 
annual basis, a list of contractor employees listing the employees 
name, position(s), and licenses and/or certifications and their current 
certification number. This annual statement of driver competency must 
include any advanced certifications, such as Advanced Cardiac Life 
Support or specialized training to assist and secure patients by 
stretcher or wheelchair, as applicable.
    (4) Within seven (7) days after receipt of award notification, the 
contractor shall provide evidence of required training, certifications, 
licensing and any other qualifications of any personnel who will be 
performing services under the contract. The initial documentation shall 
be provided to the contracting officer and COR.
    (c) Contracts must include requirements to report vehicle accidents 
and incidents to the contracting officer with a formal accident report.
    (d) Contracts for ambulance services must require that the 
contractor meet the current specifications of Federal Specification 
KKK-A-1822E, ``Star of Life Ambulance'' standard.
    (e) Contracts must include requirements to ensure patient safety is 
maintained through the consistent practice of securing patient care 
equipment, other cargo, and vehicles, and ensure that security of 
patients in vehicles is established and observed when transportation 
needs are either primary or secondary in the actual performance of the 
contract. When contracting for these services, consider using 
requirements language to ensure that patient transportation meets 
industry standards for transporting patients based on the patient's 
condition/needs (e.g., wheelchair, ambulatory, on stretcher, etc.).

0
11. Subpart 847.3 is revised to read as follows:
Subpart 847.3--Transportation in Supply Contracts
847.302 Place of delivery--f.o.b. point.
847.305 Solicitation provisions, contract clauses, and 
transportation factors.
847.305-10 Packing, marking, and consignment instructions.
847.305-70 Potential destinations known but quantities unknown.
847.305-71 VA contract clauses.
847.306 Transportation factors in the evaluation of offers.
847.306-70 Records of claims.

Subpart 847.3--Transportation in Supply Contracts


847.302   Place of delivery--f.o.b. point.

    The contracting officer shall insert clause 852.247-71, Delivery 
Location, or a clause substantially the same as the clause at 852.247-
71, Delivery Location, in supply contracts when it is necessary to 
specify delivery locations. If appropriate, the clause may reference an 
attachment which lists various delivery locations and other delivery 
details (e.g., quantities to be delivered to each location, etc.).


847.305   Solicitation provisions, contract clauses, and transportation 
factors.


847.305-10   Packing, marking, and consignment instructions.

    (a) The contracting officer shall insert clause 852.247-72, Marking 
Deliverables, or a clause substantially the same as 852.247-72 in 
solicitations and contracts if special marking on deliverables are 
required.
    (b) The contracting officer shall insert the clause at 852.247-73, 
Packing for Domestic Shipment, in contracts when item(s) will be 
delivered for immediate use to a destination in the continental United 
States; when the material specification or purchase description does 
not provide preservation, packaging, packing, and/or marking 
requirements; and/or when the requiring activity has not cited a 
specific specification for packaging.


847.305-70   Potential destinations known but quantities unknown.

    When the contracting officer contracts with multiple bidders to 
provide items directly to VA field installations, on an f.o.b. origin 
basis, the evaluation of bids must follow specific procedures. In these 
instances, the contracting officer shall insert clause 852.247-70, 
Determining Transportation Costs for Evaluation of Offers, or a clause 
substantially the same as clause 852.247-70. By inserting this clause, 
each bid is placed on an equal basis, even though specific quantities 
required by each facility cannot be predetermined. The contracting 
officer must use an anticipated demand factor in proportion to the 
number of hospital beds or patient workload.


847.305-71   VA contract clauses.

    (a) The contracting officer shall insert clause 852.247-74, Advance 
Notice of Shipment, or a clause substantially the same as 852.247-74, 
in solicitations and contracts when the f.o.b. point is destination, 
and special Government assistance is required in the delivery or 
receipt of the items.

[[Page 48262]]

    (b) The contracting officer shall insert clause 852.247-75, Bills 
of Lading, or a clause substantially the same as clause at 852.247-75, 
in f.o.b. origin solicitations and contracts.


847.306   Transportation factors in the evaluation of offers.


847.306-70   Records of claims.

    When contracting for transportation, and consistent with FAR 
15.304, contracting officers should consider using offerors' record of 
claims involving loss or damage as an evaluation factor or subfactor.

PART 852--SOLICITATION PROVISIONS AND CONTRACT CLAUSES

0
12. The authority citation for part 852 continues to read as follows:

    Authority: 38 U.S.C. 8127-8128, and 8151-8153; 40 U.S.C. 121(c); 
41 U.S.C. 1121(c)(3); 41 U.S.C. 1303; 41 U.S.C. 1702; and 48 CFR 
1.301-1.304.


852.229-70   [Removed and Reserved]

0
13. Section 852.229-70 is removed and reserved.


852.246-70  [Removed and Reserved]

0
14. Section 852.246-70 is removed and reserved.

0
15. Section 852.246-71 is revised to read as follows:


852.246-71   Rejected Goods.

    As prescribed in 846.370-1, insert the following clause:

Rejected Goods (Oct 2018)

    (a) Supplies and equipment. Rejected goods will be held subject 
to Contractor's order for not more than 15 days, after which the 
rejected merchandise will be returned to the Contractor's address at 
the Contractor's risk and expense. Expenses incident to the 
examination and testing of materials or supplies that have been 
rejected will be charged to the Contractor.
    (b) Perishable supplies. The Contractor shall remove rejected 
perishable supplies within 48 hours after notice of rejection. 
Supplies determined to be unfit for human consumption will not be 
removed without permission of the local health authorities. Supplies 
not removed within the allowed time may be destroyed. The Department 
of Veterans Affairs will not be responsible for, nor pay for, 
products rejected. The Contractor will be liable for costs incident 
to examination of rejected products.

(End of Clause)

0
 16. Section 852.246-72 is revised to read as follows:


852.246-72   Frozen Processed Foods.

    As prescribed in 846.370-2, insert the following clause:

Frozen Processed Foods (Oct 2018)

    The products delivered under this contract shall be in excellent 
condition, shall not show evidence of defrosting, refreezing, or 
freezer burn and shall be transported and delivered to the consignee 
at a temperature of 0 degrees Fahrenheit or lower.

(End of Clause)

0
17. Section 852.246-73 is revised to read as follows:


852.246-73   Noncompliance with Packaging, Packing, and/or Marking 
Requirements.

    As prescribed in 846.370-3, insert the following clause:

Noncompliance With Packaging, Packing and/or Marking Requirements (Oct 
2018)

    Failure to comply with the packaging, packing and/or marking 
requirements indicated herein, or incorporated herein by reference, 
may result in rejection of the merchandise and request for 
replacement or repackaging, repacking, and/or marking. The 
Government reserves the right, without obtaining authority from the 
Contractor, to perform the required repackaging, repacking, and/or 
marking services and charge the Contractor at the actual cost to the 
Government for the same or have the required repackaging, repacking, 
and/or marking services performed commercially under Government 
order and charge the Contractor at the invoice rate. In connection 
with any discount offered, time will be computed from the date of 
completion of such repackaging, repacking and/or marking services.

(End of Clause)


852.246-74   [Removed and Reserved]

0
18. Section 852.246-74 is removed and reserved.

0
19. Section 852.246-75 is revised to read as follows:


852.246-75   Warranty of Construction--Guarantee Period Services.

    As prescribed in 846.702-70(e), insert the following clause:

Warranty of Construction--Guarantee Period Services (Oct 2018)

    The clause 52.246-21, Warranty of Construction, is supplemented 
as follows:
    Should the Contractor fail to complete the work or fail to 
proceed promptly to provide guarantee period services after 
notification by the Contracting Officer, the Government may, subject 
to the default clause contained at FAR 52.249-10, Default (Fixed-
Price Construction), and after allowing the Contractor 10 days to 
correct and comply with the contract, terminate the right to proceed 
with the work (or the separable part of the work) that has been 
delayed or unsatisfactorily performed. In this event, the Government 
may take over the work and complete it by contract or otherwise, and 
may take possession of and use any materials, appliances, and plant 
on the work site necessary for completing the work. The Contractor 
and its sureties shall be liable for any damages to the Government 
resulting from the Contractor's refusal or failure to complete the 
work within this specified time, whether or not the Contractor's 
right to proceed with the work is terminated. This liability 
includes any increased costs incurred by the Government in 
completing the work.

(End of Clause)

0
20. Section 852.246-76 is added to read as follows:


852.246-76   Purchase of Shellfish.

    As prescribed in 846.370-4 insert the following clause:

Purchase of Shellfish (OCT 2018)

    The supplier certifies that oysters, clams, and mussels will be 
furnished only from plants approved by and operated under the 
supervision of shellfish authorities of States whose certifications 
are endorsed currently by the U.S. Public Health Service, and the 
names and certificate numbers of those shellfish dealers must appear 
on current lists published by the U.S. Public Health Service. These 
items shall be packed and delivered in approved containers, sealed 
in such manner that tampering is easily discernible, and marked with 
packer's certificate number impressed or embossed on the side of 
such containers and preceded by the State abbreviation. Containers 
shall be tagged or labeled to show the name and address of the 
approved producer or shipper, the name of the State of origin, and 
the certificate number of the approved producer or shipper.

(End of Clause)

0
21. Section 852.247-70 is revised to read as follows:


852.247-70   Determining Transportation Costs for Evaluation of Offers.

    As prescribed in 847.305-70, insert the following provision:

Determining Transportation Costs for Evaluation of Offers (Oct 2018)

    For the purpose of evaluating bids and for no other purpose, the 
delivered price per unit will be determined by adding the nationwide 
average transportation charge to the f.o.b. origin bid prices. The 
nationwide average transportation charge will be determined by 
applying the following formula: Multiply the guaranteed shipping 
weight by the freight, parcel post, or express rate, whichever is 
proper, to each destination shown below and then multiply the 
resulting transportation charges by the anticipated demand factor 
shown for each destination. Total the resulting weighted 
transportation charges for all destinations and divide the total by 
20 to give the nationwide average transportation charge.

                           Anticipated Demand
------------------------------------------------------------------------
                       Area destination                          Factor
------------------------------------------------------------------------
Oakland, California..........................................          3
Dallas, Texas................................................          2
Omaha, Nebraska..............................................          3

[[Page 48263]]

 
Fort Wayne, Indiana..........................................          4
Atlanta, Georgia.............................................          3
New York, New York...........................................          5
                                                              ----------
    Total of factors.........................................         20
------------------------------------------------------------------------

(End of Provision)

0
22. Section 852.247-71 is added to read as follows:


852.247-71  Delivery Location.

    As prescribed in 847.302, insert a clause substantially as follows:

Delivery Location (Oct 2018)

    Shipment of deliverable items, other than reports, shall be to: 
__ [Contracting Officer shall insert appropriate identifying data].

(End of Clause)

0
23. Section 852.247-72 is added to read as follows:


852.247-72   Marking Deliverables.

    As prescribed in 847.305-10(a) insert a clause substantially the 
same as:

Marking Deliverables (Oct 2018)

    (a) The contract number shall be placed on or adjacent to all 
exterior mailing or shipping labels of deliverable items called for 
by the contract.
    (b) Mark deliverables, except reports, for: __[Contracting 
Officer shall insert appropriate identifying data].

(End of Clause)

0
24. Section 852.247-73 is added to read as follows:


852.247-73   Packing for Domestic Shipment.

    As prescribed in 847.305-10(b), insert the following clause:

Packing for Domestic Shipment (Oct 2018)

    Material shall be packed for shipment in such a manner that will 
insure acceptance by common carriers and safe delivery at 
destination. Containers and closures shall comply with regulations 
of carriers as applicable to the mode of transportation.

(End of Clause)

0
25. Section 852.247-74 is added to read as follows:


852.247-74   Advance Notice of Shipment.

    As prescribed in 847.305-71(a), insert the following clause:

Advance Notice of Shipment (Oct 2018)

    __ [Insert number of work days] work days prior to shipping 
item(s)
    __ [Insert items to be shipped], the Contractor shall furnish 
the anticipated shipment date, bill of lading number (if 
applicable), and carrier identity to __ [Insert individual(s) to 
receive notification] and to the Contracting Officer.

(End of Clause)

0
26. Section 852.247-75 is added to read as follows:


852.247-75   Bills of Lading.

    As prescribed in 847.305-71(b), insert the following clause:

Bills of Lading (Oct 2018)

    The purpose of this clause is to define when a commercial bill 
of lading or a Government bill of lading is to be used when 
shipments of deliverable items under this contract are f.o.b. 
origin.
    (a) Commercial bills of lading. All domestic shipments shall be 
made via commercial bills of lading (CBLs). The Contractor shall 
prepay domestic transportation charges. The Government shall 
reimburse the Contractor for these charges if they are added to the 
invoice as a separate line item supported by the paid freight 
receipts. If paid receipts in support of the invoice are not 
obtainable, a statement as described below must be completed, signed 
by an authorized company representative, and attached to the 
invoice.
    ``I certify that the shipments identified below have been made, 
transportation charges have been paid by __ [company name], and paid 
freight or comparable receipts are not obtainable.
    Contract or Order Number: __
    Destination: __ .''
    (b) Government bills of lading. (1) International (export) and 
domestic overseas shipments of items deliverable under this contract 
shall be made by Government bills of lading (GBLs). As used in this 
clause, ``domestic overseas'' means non-continental United States, 
i.e., Hawaii, Commonwealth of Puerto Rico, and possessions of the 
United States.
    (2) At least 15 days before shipment, the Contractor shall 
request in writing GBLs from: __ [Insert name, title, and mailing 
address of designated transportation officer or other official 
delegated responsibility for GBLs]. If time is limited, requests may 
be by telephone: __ [Insert appropriate telephone number]. Requests 
for GBLs shall include the following information.
    (i) Item identification/description.
    (ii) Origin and destination.
    (iii) Individual and total weights.
    (iv) Dimensional weight.
    (v) Dimensions and total cubic footage.
    (vi) Total number of pieces.
    (vii) Total dollar value.
    (viii) Other pertinent data.

(End of Clause)


852.270-2  [Removed]

0
27. Section 852.270-2 is removed.


852.270-3  [Removed]

0
28. Section 852.270-3 is removed.

PART 870--[REMOVED AND RESERVED]

0
29. Under the authority of 48 CFR 1.301 through 1.304, part 870 is 
removed and reserved.

[FR Doc. 2018-20323 Filed 9-21-18; 8:45 am]
 BILLING CODE 8320-01-P