[Federal Register Volume 85, Number 186 (Thursday, September 24, 2020)]
[Rules and Regulations]
[Pages 60073-60079]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-18172]



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DEPARTMENT OF VETERANS AFFAIRS

48 CFR Parts 802, 809, 841, 842, and 852

RIN 2900-AQ38


VA Acquisition Regulation: Contractor Qualifications; Acquisition 
of Utility Services; and Contract Administration and Audit Services

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revise or remove any policy superseded by changes in the Federal 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streamline and align the VAAR with the FAR and remove outdated and 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, VA will publish them in the 
Federal Register. In particular, this rulemaking revises VAAR 
concerning Contractor Qualifications, Acquisition of Utility Services, 
and Contract Administration and Audit Services, and affected parts 
Definitions of Words and Terms and Solicitation Provisions and Contract 
Clauses.

DATES: This rule is effective on October 26, 2020.

FOR FURTHER INFORMATION CONTACT: Mr. Rafael 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: 

Background

    On April 20, 2020, VA published a proposed rule in the Federal 
Register (85 FR 21811) which announced VA's intent to amend regulations 
for VAAR Case RIN 2900-AQ38 (Parts 809, 841 and 842). VA provided a 60-
day comment period for the public to respond to the proposed rule and 
submit comments. The comment period for the proposed rule ended on June 
19, 2020 and VA received no comments. This rule adopts as a final rule, 
without changes, the proposed rule published in the Federal Register on 
April 20, 2020.

Executive Orders 12866, 13563 and 13771

    Executive Orders (E.O.s) 12866 and 13563 direct agencies to assess 
all costs and benefits of available regulatory alternatives and, when 
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, 
reducing costs, harmonizing rules, and promoting flexibility. The 
Office of Information and Regulatory Affairs has determined that this 
rule is not a significant regulatory action under Executive Order 
12866.
    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 Regulatory Impact Analysis (RIA) 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 rule is not an E.O. 13771 regulatory action because this rule 
is not significant under E.O. 12866.

Paperwork Reduction Act

    The Paperwork Reduction Act of 1995 (at 44 U.S.C. 3507) requires 
that VA consider the impact of paperwork and other information 
collection burdens imposed on the public. Under 44 U.S.C. 3507(a), an 
agency may not collect or sponsor the collection of information, nor 
may it impose an information collection requirement unless it displays 
a currently valid OMB control number. See also 5 CFR 1320.8(b)(3)(vi).
    This final rule contains one provision constituting a collection of 
information at 48 CFR 809.507-1 and 48 CFR 852.209-70 which require 
offerors on solicitations for management support and consulting 
services to advise, as part of the firm's offer, whether or not award 
of the contract to the firm might involve a conflict of interest and, 
if so, to disclose all relevant facts regarding the conflict. The 
information is used by the contracting officer to determine whether or 
not to award a contract to the firm or, if a contract is to be awarded 
despite a potential conflict, whether or not additional contract terms 
and conditions are necessary to mitigate the conflict.
    No new collection of information is associated with this provision 
as a part of this final rule. The information collection requirement 
for 809.507-1 and 852.209-70 is currently approved by OMB and has been 
assigned OMB control number 2900-0418. This rule amends this 
information collection requirement to revise 809.507-1 to designate 
852.209-70 as a provision instead of a clause. For the requested 
administrative amendments to VAAR 852.209-70, as required by the 
Paperwork Reduction Act of 1995 (at 44 U.S.C. 3507(d)), VA will submit 
this information collection amendment to OMB for its review.

Regulatory Flexibility Act

    The Secretary hereby certifies that 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 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 would 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, pursuant 
to 5 U.S.C. 605(b), the initial and final regulatory flexibility 
analysis requirements of 5 U.S.C. 603 and 604 as they do not apply.

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.

Congressional Review Act

    Pursuant to the Congressional Review Act (5 U.S.C. 801 et seq.), 
the Office of Information and Regulatory Affairs designated this rule 
as not a major rule, as defined by 5 U.S.C. 804(2).

List of Subjects

48 CFR Part 802

    Government procurement.

48 CFR Part 809

    Government procurement, Reporting and recordkeeping requirements.

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48 CFR Part 841

    Government procurement, Utilities.

48 CFR Part 842

    Accounting, Government procurement.

48 CFR Part 852

    Government procurement, Reporting and recordkeeping requirements.

Signing Authority

    The Secretary of Veterans Affairs, or designee, 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. Brooks D. 
Tucker, Acting Chief of Staff, Department of Veterans Affairs, approved 
this document on August 14, 2020, for publication.

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 
802, 809, 841, 842 and 852 as follows:

PART 802--DEFINITIONS OF WORDS AND TERMS

0
1. The authority citation for part 802 continues to read as follows:

    Authority:  40 U.S.C. 121(c); 41 U.S.C. 1121(c)(3); 41 U.S.C. 
1702; and 48 CFR 1.301-1.304.


802.101   [Amended]

0
2. Section 802.101 is amended to remove the definitions for 
``Suspending and Debarring Official (SDO)'' and ``Suspension and 
Debarment Committee (S&D Committee).''

PART 809--CONTRACTOR QUALIFICATIONS

0
3. The authority citation for part 809 is revised to read as follows:

    Authority: 38 U.S.C. 8127 and 8128; 40 U.S.C. 121(c); 41 U.S.C. 
1702; and 48 CFR 1.301-1.304.

Subpart 809.1--Responsible Prospective Contractors


809.104 and 809.104-2   [Removed]

0
4. Sections 809.104 and 809.104-2 are removed.

Subpart 809.2 [Removed and Reserved]

0
5. Subpart 809.2, consisting of sections 809.201, 809.202, 809.204, 
809.206, 809.206-1, and 809.270, is removed and reserved.

0
6. Subpart 809.4 is revised to read as follows:
Subpart 809.4--Debarment, Suspension, and Ineligibility
Sec.
809.400 Scope of subpart.
809.402 Policy.
809.403 Definitions.
809.405 Effect of listing.
809.405-1 Continuation of current contracts.
809.405-2 Restrictions on subcontracting.
809.406 Debarment.
809.406-1 General.
809.406-2 Causes for debarment.
809.406-270 Additional causes for debarment.
809.406-3 Procedures.
809.406-4 Period of debarment.
809.407 Suspension.
809.407-1 General.
809.470 Fact-finding procedures.


809.400   Scope of subpart.

    This subpart implements FAR subpart 9.4 and prescribes VA's 
procedures and related actions for the suspension and debarment of 
contractors.


809.402   Policy.

    (b) Statutory debarments pursuant to the authority of 38 U.S.C. 
8127(g), Enforcement Penalties for Misrepresentation, are mandatory 
when the determination is made that a business concern has willfully 
and intentionally misrepresented its status as a service-disabled, 
veteran-owned small business (SDVOSB) or veteran-owned small business 
(VOSB).


809.403  Definitions.

    Suspension & Debarment (S&D) Committee means a committee authorized 
by the SDO to assist the SDO with suspension and debarment related 
matters.
    Suspending and Debarring Official (SDO) means the individual 
responsible for final decisions regarding suspension and debarment, as 
appointed by the agency.


809.405   Effect of listing.

    The authority under FAR 9.405(a), 9.405(d)(2), and 9.405(d)(3) to 
determine whether to solicit from, evaluate bids or proposals from, or 
award contracts to contractors with active exclusions in the System for 
Award Management (SAM) is delegated to the Suspending and Debarring 
Official (SDO). This authority is further delegated to the HCAs, who 
may delegate this authority, in writing, to a designee.


809.405-1   Continuation of current contracts.

    (a) Notwithstanding the suspension, proposed debarment, or 
debarment of a contractor, VA may continue contracts or subcontracts in 
existence at the time the contractor was suspended, proposed for 
debarment, or debarred, unless the cognizant head of the contracting 
activity (HCA) directs otherwise. Examples of factors to be considered 
include, but are not limited to, potential costs associated with a 
termination, possible disruption to VA program objectives, and 
integrity of VA acquisition programs.
    (b) Authority to make the determinations under FAR 9.405-1(b) is 
delegated to the SDO and is further delegated to the HCA, who may 
delegate this authority, in writing, to a designee. The HCA or their 
designee must make a written determination of the compelling reasons in 
accordance with FAR 9.405-1(b). Compelling reasons for the purposes of 
FAR 9.405-1(b) include, but are not limited to, urgency of the need for 
new or continued work, lengthy time period to acquire the new work from 
other sources and meeting estimated quantity for requirements 
contracts.


809.405-2   Restrictions on subcontracting.

    Authority to make the written determination required under FAR 
9.405-2 consenting to a contractor's use of a subcontractor who is 
suspended, proposed for debarment, or debarred is delegated to the SDO. 
This authority is further delegated to the HCA, who may delegate this 
authority, in writing, to a designee.


809.406  Debarment.


809.406-1  General.

    (a) For the purposes of FAR 9.406-1, the SDO's authority includes 
debarments pursuant to the Federal Management Regulation at 41 CFR 102-
117.295. In addition to the factors listed in FAR 9.406-1, the SDO may 
consider the following examples before arriving at a debarment 
decision:
    (1) Whether the contractor had a mechanism, such as a hotline, by 
which employees could have reported suspected instances of improper 
conduct, and instructions in place that encouraged employees to make 
such reports; or
    (2) Whether the contractor conducted periodic reviews of company 
business practices, procedures, policies, and internal controls for 
compliance with standards of conduct and the special requirements of 
Government contracting.

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    (c) As provided in FAR 9.406-1(c), authority to determine whether 
to continue business dealings between VA and a contractor suspended, 
proposed for debarment, or debarred is delegated to the SDO.


809.406-2  Causes for debarment.


809.406-270   Additional causes for debarment.

    (a) Discretionary causes. (1) In addition to the causes listed in 
FAR 9.406-2 (a) through (c), the SDO may debar contractors, based upon 
a preponderance of the evidence (as defined at FAR 2.101), for the 
Government's protection, for--
    (i) Any deliberate violation of the limitation on subcontracting 
clause requirements for acquisitions under subpart 819.70; or
    (ii) Failure to observe the material provisions of a voluntary 
exclusion or an administrative agreement.
    (2) The period of debarment shall be commensurate with the 
seriousness of the action.
    (b) Statutory cause. (1) Pursuant to 38 U.S.C. 8127(g), Enforcement 
Penalties for Misrepresentation, the SDO shall debar, from contracting 
with VA, for a period of not less than five years, any business concern 
that has willfully and intentionally misrepresented the status of that 
concern as a small business concern owned and controlled by Veterans or 
as a small business concern owned and controlled by service-disabled 
Veterans.
    (2) Debarment of a business concern pursuant to 38 U.S.C. 8127(g) 
shall include the debarment of all principals in the business concern. 
Debarment shall be for a period of not less than five years.
    (3) ``Willful and intentional'' misrepresentations, for the purpose 
of debarment actions taken pursuant to 38 U.S.C. 8127(g), are defined 
as deliberate misrepresentations concerning the status of the concern 
as a small business concern owned and controlled by Veterans or as a 
small business concern owned and controlled by service-disabled 
Veterans as supported by the preponderance of evidence. Examples of a 
preponderance of evidence for deliberate misrepresentation of SDVOSB 
and/or VOSB status include but are not limited to: Criminal 
convictions, plea agreements, deferred prosecution agreements, Board of 
Contract Appeals decisions, and admissions of guilt.


809.406-3  Procedures.

    (a) Any individual may submit a referral to debar an individual or 
contractor to the SDO or to the S&D Committee. The referral for 
debarment shall be supported with evidence of a cause for debarment 
listed in FAR 9.406-2, or 809.406-2. The SDO shall forward referrals 
for debarment to the S&D Committee. If the referring individual is a VA 
employee and the referral for debarment is based on possible criminal 
or fraudulent activities, the VA employee shall also refer the matter 
to the VA Office of Inspector General.
    (b) When the S&D Committee finds preponderance of the evidence for 
a cause for debarment, as listed in FAR 9.406-2 or 809.406-2, it shall 
prepare a recommendation and draft notice of proposed debarment for the 
SDO's consideration.
    (c) VA shall send the notice of proposed debarment to the last 
known address of the individual or contractor, the individual or 
contractor's counsel, or agent for service of process, by certified 
mail, return receipt requested, or any other means that allows for 
confirmation of delivery. In the case of a contractor, VA may send the 
notice of proposed debarment to any partner, principal, officer, 
director, owner or co-owner, or joint venture. The S&D Committee 
concurrently shall list the appropriate parties as excluded in the SAM 
in accordance with FAR 9.404.
    (d) If VA does not receive a reply from the contractor within 30 
days after sending the notice of proposed debarment, the S&D Committee 
shall prepare a recommendation and refer the case to the SDO for a 
decision on whether or not to debar based on the information available.
    (e) If VA receives a reply from the contractor within 30 days after 
sending the notice of proposed debarment, the S&D Committee shall 
consider the information in the reply before the S&D Committee makes 
its recommendation to the SDO.
    (f) The S&D Committee, upon the request of the contractor proposed 
for debarment, shall, as soon as practicable, allow the contractor an 
opportunity to appear before the S&D Committee to present information 
or argument personally or through a representative. The contractor may 
supplement the oral presentation with written information and argument. 
VA shall conduct the proceeding in an informal manner and without 
requirement for a transcript.
    (g) If the S&D Committee finds the contractor's or individual's 
submission in opposition to the proposed debarment raises a genuine 
dispute over facts material to the proposed debarment and the debarment 
action is not based on a conviction or civil judgment, the S&D 
Committee shall submit to the SDO the information establishing the 
dispute of material facts. If the SDO agrees there is a genuine dispute 
of material facts, the SDO shall refer the dispute to a designee for a 
resolution pursuant to 809.470, Fact-finding procedures. The S&D 
Committee shall provide the contractor or individual the disputed 
material fact(s). Decisions and determinations of VA's Center for 
Verification and Evaluation (CVE) or Office of Small and Disadvantaged 
Business Utilization (OSDBU), such as status protest decisions, and 
size determinations of the SBA shall not be subject to dispute or fact-
finding in proposed debarment actions. The S&D Committee and SDO shall 
accept these decisions and determinations as resolved facts.
    (h) If the proposed debarment action is based on a conviction or 
civil judgment, or if there are no disputes over material facts, or if 
any disputes over material facts have been resolved pursuant to 
809.470, Fact-finding procedures, the SDO shall make a decision on the 
basis of all information available including any written findings of 
fact submitted by the designated fact finder, and oral or written 
agreements presented or submitted to the S&D Committee by the 
contractor.
    (i) In actions processed under FAR 9.406 where no suspension is in 
place and where fact finding is not required, the VA shall make the 
final decision on the proposed debarment within 30 working days after 
receipt of any information and argument submitted by the contractor, 
unless the SDO extends this period for a good cause.
    (j) In actions processed under 809.406-270(b), the SDO notifies the 
individuals and/or contractors of the determination of willful and 
intentional misrepresentation in the notice of proposed debarment. VA 
shall issue the final decision, removing or upholding the 
determination, within 90 days after SDO's determination of willful and 
intentional misrepresentation.


809.406-4   Period of debarment.

    (a) The SDO will base the period of debarment on the circumstances 
surrounding the cause(s) for debarment.
    (b) The SDO may remove a debarment imposed under FAR 9.406, amend 
its scope, or reduce the period of debarment based on a S&D Committee 
recommendation if--
    (1) VA has debarred the contractor; and
    (2) The debarring official concurs with documentary evidence 
submitted by or on behalf of the contractor setting forth the 
appropriate grounds for granting relief. Appropriate grounds include 
newly discovered material

[[Page 60076]]

evidence, reversal of a conviction, bona fide change of ownership or 
management, elimination of the cause for which debarment was imposed, 
or any other appropriate grounds.
    (c) The period of debarment for willful and intentional 
misrepresentations of SDVOSB or VOSB status pursuant to 809.406-270(b) 
shall not be less than 5 years.


809.407  Suspension.


809.407-1   General.

    (a) As provided in FAR 9.407-1(d), authority to determine whether 
to continue business dealings between VA and a suspended contractor is 
delegated to the HCAs. Compelling reasons include, but are not limited 
to, urgency of the need for new or continued work, lengthy time period 
to acquire the new work from other sources, and meeting estimated 
quantities for requirements contracts.
    (b) For the purposes of FAR 9.407-1, the SDO is the suspending 
official under the Federal Management Regulation at 41 CFR 102-117.295.


809.407-3  Procedures.

    (a) Any individual may submit a referral to suspend an individual 
or contractor to the SDO or to the S&D Committee. Referrals shall 
include supporting evidence of a cause for suspension listed in FAR 
9.407-2. The SDO shall forward the referral to the S&D Committee. If 
the referring individual is a VA employee and the referral for 
suspension is based on possible criminal or fraudulent activities, the 
VA employee shall also refer the matter to the VA Office of Inspector 
General.
    (b) When the S&D Committee finds adequate evidence of a cause for 
suspension, as listed in FAR 9.407-2, it shall prepare a recommendation 
and draft notice of suspension for the SDO's consideration.
    (c) VA shall send the notice of suspension to the last known 
address of the individual or contractor, the individual or contractor's 
counsel, or agent for service of process, by certified mail, return 
receipt requested, or any other means that allows for confirmation of 
delivery. In the case of a contractor, VA may send the notice of 
suspension to any partner, principal, officer, director, owner or co-
owner, or joint venture. The S&D Committee concurrently shall list the 
appropriate parties as excluded in SAM in accordance with FAR 9.404.
    (d) If VA receives a reply from the contractor within 30 days after 
receipt of the notice of suspension, the S&D Committee shall consider 
the information in the reply before the Committee makes further 
recommendations to the SDO. The S&D Committee, upon the request of a 
suspended contractor, shall, as soon as practicable, allow the 
contractor an opportunity to appear before the S&D Committee to present 
information or argument personally or through a representative. The 
contractor may supplement the oral presentation with written 
information and argument. The proceeding will be conducted in an 
informal manner and without requirement for a transcript.
    (e) For the purposes of FAR 9.407-3(b)(2), Decision making process, 
in actions not based on an indictment, if the S&D Committee finds that 
the contractor's submission in opposition to the suspension raises a 
genuine dispute over facts material to the suspension, the S&D 
Committee shall submit to the SDO the information establishing the 
dispute of material facts. However, the S&D Committee may first 
coordinate any further proceeding regarding the material facts in 
dispute with the Department of Justice or with a State prosecuting 
authority in a case involving a State jurisdiction. VA shall take no 
further action to determine disputed material facts pursuant to this 
section or 809.470 if the Department of Justice or a State prosecuting 
authority advises VA in writing that additional proceedings to make 
such a determination would prejudice Federal or State legal 
proceedings.
    (f) If the SDO agrees that there is a genuine dispute of material 
facts, the SDO shall refer the dispute to the designee for resolution 
pursuant to 809.470.


809.470   Fact-finding procedures.

    The provisions of this section constitute the procedures to be used 
to resolve genuine disputes of material fact pursuant to 809.406-3 and 
809.407-3 of this subpart. The SDO shall appoint a designee to conduct 
the fact-finding. OGC shall represent VA at any fact-finding hearing 
and may present witnesses for VA and question any witnesses presented 
by the contractor. The proceedings before the fact-finder will be 
limited to a finding of the facts in dispute, as determined by the SDO. 
The fact-finder shall establish the date for the fact-finding hearing, 
normally to be held within 30 days after the S&D Committee notifies the 
contractor or individual that the SDO has established a genuine dispute 
of material fact(s) exists.
    (a) The Government's representative and the contractor will have an 
opportunity to present evidence relevant to the material fact(s) 
identified by the SDO. The contractor or individual may appear in 
person or through a representative at the fact-finding hearing. The 
contractor or individual may submit documentary evidence, present 
witnesses, and confront any person the agency presents.
    (b) Witnesses may testify in person. Witnesses will be reminded of 
the official nature of the proceedings and that any false testimony 
given is subject to criminal prosecution. Witnesses are subject to 
cross-examination. Hearsay evidence may be presented and will be given 
appropriate weight by the fact-finder.
    (c) The proceedings shall be transcribed and a copy of the 
transcript shall be made available at cost to the contractor upon 
request, unless the contractor and the fact-finder, by mutual 
agreement, waive the requirement for a transcript.
    (d) The fact-finder shall determine the disputed fact(s) by a 
preponderance of the evidence for proposed debarments, and by adequate 
evidence for suspensions. Written findings of fact shall be prepared by 
the fact-finder. A copy of the findings of fact shall be provided to 
the SDO, the Government's representative, and the contractor or 
individual. The SDO will consider the written findings of fact in the 
decision regarding the suspension or proposed debarment.

Subpart 809.5--Organizational and Consultant Conflicts of Interest


809.503  [Removed]

0
7. Section 809.503 is removed.


809.504  [Removed]

0
8. Section 809.504 is removed.

0
9. Section 809.507-1 is revised to read as follows:


809.507-1   Solicitation provisions.

    (a) While conflicts of interest may not presently exist, award of 
certain types of contracts may create potential future organizational 
conflicts of interest (see FAR 9.508 for examples). If a solicitation 
may create a potential future organizational conflict of interest, the 
contracting officer shall insert a provision in the solicitation 
imposing an appropriate restraint on the contractor's eligibility for 
award of contracts in the future. Under FAR 9.507-1, the restraint must 
be appropriate to the nature of the conflict and may exclude the 
contractor from award of one or more contracts in the future.

[[Page 60077]]

    (b) The provision at 852.209-70, Organizational Conflicts of 
Interest, must be included in any solicitation for the services 
addressed in FAR 9.502.

PART 841--ACQUISITION OF UTILITY SERVICES

0
10. The authority citation for part 841 is revised to read as follows:

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

Subpart 841.1--General


841.100  [Removed]

0
11. Section 841.100 is removed.

0
12. Section 841.102 is added to read as follows:


841.102   Applicability.

    (a) This part applies to purchases of utility services from 
nonregulated and regulated utility suppliers when a delegation of 
authority from GSA for those services is requested and obtained.
    (b)(4) The acquisition of energy, such as electricity, and natural 
or manufactured gas, when purchased as a commodity is considered to be 
acquisitions of supplies rather than utility services as described in 
FAR part 41.


841.103  [Removed]

0
13. Section 841.103 is removed.

Subpart 841.2 [Removed and reserved]

0
14. Subpart 841.2, consisting of sections 841.100 and 841.103, is 
removed and reserved.

0
15. Subpart 841.5 is added to read as follows:

Subpart 841.5--Solicitation Provision and Contract Clauses


841.501   Solicitation provision and contract clauses.


841.501-70   Disputes--Utility contracts.

    The contracting officer shall insert the clause at 852.841-70, 
Disputes--Utility Contracts, in solicitations and contracts for utility 
services subject to the jurisdiction and regulation of a utility rate 
commission.

PART 842--CONTRACT ADMINISTRATION AND AUDIT SERVICES

0
16. The authority citation for part 842 continues to read as follows:

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


0
17. Section 842.000 is revised to read as follows:


842.000  Scope of part.

    This part prescribes policies and procedures for contract 
administration and audit services for all Department of Veterans 
Affairs (VA) contracting activities.

0
18. Section 842.070 is revised to read as follows:


842.070  Definitions.

    As used in this part--
    Contract administration means Government actions taken after 
contract award to obtain compliance with such contract requirements as 
timely delivery of supplies or services, acceptance, payment, and 
closing of the contract. These actions include, but are not limited to, 
technical, financial, audit, legal, administrative, and managerial 
services in support of the contracting officer. It may include 
additional tasks requested of designated contract administration 
offices within VA in support of pre-award activities for solicitations 
issued by or awarded by other contracting activities through 
Interagency Acquisitions.
    Administrative Contracting Officer Letter of Delegation means a 
delegation of functions as set forth in FAR 42.202, 42.302 and 842.271, 
Administrative Contracting Officer's role in contract administration 
and delegated functions, that is issued by a contracting officer to 
delegate certain contract administration or specialized support 
services.

Subpart 842.1 [Removed and reserved]

0
19. Subpart 842.1, consisting of sections 842.101 and 842.102, is 
removed and reserved.

0
20. Subpart 842.2 is added to read as follows:
Subpart 842.2--Contract Administration Services
Sec.
842.270 Contracting Officer's Representatives' role in contract 
administration.
842.271 Administrative Contracting Officer's role in contract 
administration and delegated functions.
842.272 Contract clause for Government construction contract 
administration.


842.270  Contracting Officer's Representatives' role in contract 
administration.

    (a) A contracting officer may designate a qualified person to be 
the Contracting Officer's Representative (COR) for the purpose of 
performing certain technical functions in administering a contract.
    (b) The COR acts solely as a technical representative of the 
contracting officer and is not authorized to perform any function that 
results in a change in the scope, price, terms or conditions of the 
contract.
    (c) A COR designation must be made in writing by the contracting 
officer. The designation shall identify the responsibilities and 
limitations of the COR. A copy of the designation must be furnished to 
the contractor and the Administrative Contracting Officer (ACO), if 
separately assigned.


842.271   Administrative Contracting Officer's role in contract 
administration and delegated functions.

    (a) Contracting officers are authorized to delegate certain 
contract administration or specialized support services in accordance 
with FAR 42.202 and 42.302 to cognizant VA administrative contracting 
officers.
    (b) The Administrative Contracting Officer's authority is limited 
to the actions detailed in the delegation.
    (c) These delegations of authority shall be set forth in a written 
Administrative Contracting Officer (ACO) Letter of Delegation issued by 
the contracting officer to the accepting contract administration office 
and designated administrative contracting officer. The ACO Letter of 
Delegation shall contain the information required in FAR 42.202(a) 
through (c) and identify the responsibilities and limitations of the 
ACO. A copy of the delegation will be furnished to the contractor and 
the ACO.
    (d) The contracting officer shall insert the clause at 852.242-71, 
Administrative Contracting Officer, in solicitations and contracts 
expected to exceed the micro-purchase threshold.


842.272   Contract clause for Government construction contract 
administration.

    The contracting officer shall insert the clause at 852.242-70, 
Government Construction Contract Administration, in solicitations and 
contracts for construction expected to exceed the micro-purchase 
threshold, when contract administration is delegated.

0
21. Section 842.705 is revised to read as follows:


842.705   Final indirect cost rates.

    Except when the quick-closeout procedures described in FAR 42.708 
are used, contracting officers shall request contract audits on 
proposed final indirect cost rates and billing rates for use in cost 
reimbursement and fixed-price incentive contracts as prescribed in FAR 
subpart 42.7.

[[Page 60078]]

Subpart 842.8 [Removed and reserved]

0
22. Subpart 842.8, consisting of sections 842.801, 842.801-70, and 
842.803, is removed and reserved.

Subpart 842.12--Novation and Change-of-Name Agreements

0
23. Section 842.1202 is added to read as follows:


842.1202  Responsibility for executing agreements.

    To avoid duplication of effort on the part of VA contracting 
offices in preparing and executing agreements to recognize a change of 
name or successor in interest involving multiple contracts issued by VA 
activities, only one agreement will be prepared and executed between 
the Government and the parties (transferor and transferee) and will be 
processed as forth in FAR 42.1203. The Office of Acquisition and 
Logistics, Risk Management and Compliance Service will, in each case, 
designate a cognizant HCA responsible for assigning a contracting 
officer. The designated contracting officer shall be responsible for 
taking all necessary and appropriate actions with respect to either 
recognizing or not recognizing a successor in interest or recognizing a 
change of name agreement and processing and executing the agreements as 
set forth in VA procedures.


842.1203  [Removed]

0
24. Section 842.1203 is removed.

PART 852--SOLICITATION PROVISIONS AND CONTRACT CLAUSES

0
25. 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 through 1.304.

Subpart 852.2--Texts of Provisions and Clauses

0
26. Section 852.209-70 is revised to read as follows:


852.209-70  Organizational Conflicts of Interest.

    As prescribed in 809.507-1(b), insert the following provision:

Organizational Conflicts of Interest (OCT 2020)

    (a) It is in the best interest of the Government to avoid 
situations which might create an organizational conflict of interest or 
where the Offeror's performance of work under the contract may provide 
the Contractor with an unfair competitive advantage. The term 
``organizational conflict of interest'' means that because of other 
activities or relationships with other persons, a person is unable to 
render impartial assistance or advice to the Government, or the 
person's objectivity in performing the contract work is or might be 
otherwise impaired, or the person has an unfair competitive advantage.
    (b) The Offeror shall provide a statement with its offer which 
describes, in a concise manner, all relevant facts concerning any past, 
present, or currently planned interest (financial, contractual, 
organizational, or otherwise) or actual or potential organizational 
conflicts of interest relating to the services to be provided under 
this solicitation. The Offeror shall also provide statements with its 
offer containing the same information for any consultants and 
subcontractors identified in its proposal and which will provide 
services under the solicitation. The Offeror may also provide relevant 
facts that show how its organizational and/or management system or 
other actions would avoid or mitigate any actual or potential 
organizational conflicts of interest.
    (c) Based on this information and any other information solicited 
or obtained by the Contracting Officer, the Contracting Officer may 
determine that an organizational conflict of interest exists which 
would warrant disqualifying the Contractor for award of the contract 
unless the organizational conflict of interest can be mitigated to the 
Contracting Officer's satisfaction by negotiating terms and conditions 
of the contract to that effect. If the conflict of interest cannot be 
mitigated and if the Contracting Officer finds that it is in the best 
interest of the United States to award the contract, the Contracting 
Officer shall request a waiver in accordance with FAR 9.503.
    (d) Nondisclosure or misrepresentation of actual or potential 
organizational conflicts of interest at the time of the offer or 
arising as a result of a modification to the contract, may result in 
the termination of the contract at no expense to the Government.
(End of Provision)

0
27. Section 852.241-70 is added to read as follows:


852.241-70  Disputes--Utility Contracts.

    As prescribed in 841.501-70, insert the following clause:

Disputes--Utility Contracts (SEP 2020)

    (a) Definition. As used in this clause, Independent regulatory body 
means the Federal Energy Regulatory Commission, a state-wide agency, or 
an agency with less than state-wide jurisdiction when operating 
pursuant to state authority. The body has the power to fix, establish, 
or control the rates and services of utility suppliers.
    (b) Independent Regulatory Body determinations. The requirements of 
the Disputes clause at FAR 52.233-1 are supplemented to provide that 
matters involving the interpretation of tariffed retail rates, tariff 
rate schedules, and tariffed terms provided under this contract are 
subject to any determinations by the independent regulatory body having 
jurisdiction.
(End of Clause)

0
28. Section 852.242-70 is revised to read as follows:


852.242-70  Government Construction Contract Administration.

    As prescribed in 842.272, insert the following clause. This is a 
fill-in clause.

Government Construction Contract Administration (OCT 2020)

    (a) Contract administration functions set forth in FAR 42.302 are 
hereby delegated to:


[Insert name and office address of Contracting Officer]

[Note: If any of the functions set forth in FAR 42.302 are to be 
retained by the Contracting Officer, identify those as well with the 
notation: ``With the exception of the following contract administration 
functions: ___.'' Delete this notation if not required.]

    (b) The following functions will be retained by the Contracting 
Officer or Administrative Contracting Officer (ACO) and are not 
redelegable to Resident Engineers:
    (1) Award of contract modifications either through supplemental 
agreements or change orders that exceed the ACO's appointed warrant 
limitations.
    (2) Issuance of default letters.
    (3) Issuance of Cure or Show-Cause Notices.
    (4) Suspension of work letters and/or modifications.
    (5) Issuance of Contracting Officer final determination letters.
    (6) Issuance of termination notices.
    (7) Authorization of final payment.
    (c) The work will be under the direction of a Department of 
Veterans Affairs Contracting Officer, who may designate another VA 
employee to act as resident engineer at the construction site who 
possesses limited warranted authority.
    (d) Except as provided below, the resident engineer's directions 
will not

[[Page 60079]]

conflict with or change contract requirements. Within the limits of any 
specific authority delegated by the Contracting Officer, the resident 
engineer may, by written direction, make changes in the work. The 
Contractor shall be advised of the extent of such authority prior to 
execution of any work under the contract.
    (e) The Contracting Officer or an Administrative Contracting 
Officer identified in paragraph (a) may further delegate limited 
authority and specialized support services responsibilities below to 
the following warranted Resident Engineer personnel on site, not to 
exceed the dollar value and threshold of their warrant:


[Insert name and office address of Resident Engineer with limited 
authority]

    (1) Conduct post-award orientation conferences.
    (2) Issue administrative changes (see FAR 43.101) correcting errors 
or omissions, contractor address, facility or activity code, remittance 
address, computations which do not required additional contract funds, 
and other such changes.
    (3) For actions not to exceed $ [Insert dollar amount] negotiate 
and execute supplemental agreements resulting from change orders issued 
under the Changes clause.
    (4) Negotiate and execute supplemental agreements changing contract 
delivery schedules where the time extension does not exceed [Insert 
number] calendar days.
(End of Clause)

0
29. Section 852.242-71 is added to read as follows:


852.242-71  Administrative Contracting Officer.

    As prescribed in 842.271, insert the following clause:

Administrative Contracting Officer (OCT 2020)

    The Contracting Officer reserves the right to designate an 
Administrative Contracting Officer (ACO) for the purpose of performing 
certain tasks/duties in the administration of the contract. Such 
designation will be in writing through an ACO Letter of Delegation and 
will identify the responsibilities and limitations of the ACO. A copy 
of the ACO Letter of Delegation will be furnished to the Contractor.
(End of Clause)
[FR Doc. 2020-18172 Filed 9-23-20; 8:45 am]
BILLING CODE 8320-01-P