[Federal Register Volume 69, Number 180 (Friday, September 17, 2004)]
[Rules and Regulations]
[Pages 55986-55987]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 04-21017]
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DEPARTMENT OF DEFENSE
48 CFR Parts 207 and 219
[DFARS Case 2003-D109]
Defense Federal Acquisition Regulation Supplement; Consolidation
of Contract Requirements
AGENCY: Department of Defense (DoD).
ACTION: Interim rule with request for comments.
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SUMMARY: DoD has issued an interim rule amending the Defense Federal
Acquisition Regulation Supplement (DFARS) to implement Section 801 of
the National Defense Authorization Act for Fiscal Year 2004. Section
801 places restrictions on the consolidation of two or more
requirements of a DoD department, agency, or activity into a single
solicitation and contract.
DATES: Effective date: September 17, 2004.
Comment date: Comments on the interim rule should be submitted to
the address shown below on or before November 16, 2004, to be
considered in the formation of the final rule.
ADDRESSES: You may submit comments, identified by DFARS Case 2003-D109,
using any of the following methods:
Federal eRulemaking Portal: http://www.regulations.gov.
Follow the instructions for submitting comments.
Defense Acquisition Regulations Web site: http://emissary.acq.osd.mil/dar/dfars.nsf/pubcomm. Follow the instructions for
submitting comments.
E-mail: [email protected]. Include DFARS Case 2003-D109 in the
subject line of the message.
Fax: Primary: (703) 602-7887; Alternate: (703) 602-0350.
Mail: Defense Acquisition Regulations Council, Attn: Ms.
Donna Hairston-Benford, OUSD(AT&L)DPAP(DAR), IMD 3C132, 3062 Defense
Pentagon, Washington, DC 20301-3062.
Hand Delivery/Courier: Defense Acquisition Regulations
Council, Crystal Square 4, Suite 200A, 241 18th Street, Arlington, VA
22202-3402.
All comments received will be posted to http://emissary.acq.osd.mil/dar/dfars.nsf.
FOR FURTHER INFORMATION CONTACT: Ms. Donna Hairston-Benford, (703) 602-
0289.
SUPPLEMENTARY INFORMATION:
A. Background
This interim rule amends DFARS Parts 207 and 219 to implement
Section 801 of the National Defense Authorization Act for Fiscal Year
2004 (Public Law 108-136). Section 801 adds 10 U.S.C. 2382, which
places restrictions on the use of an acquisition strategy that includes
a consolidation of contract requirements with a total value exceeding
$5,000,000.
This rule was not subject to Office of Management and Budget review
under Executive Order 12866, dated September 30, 1993.
B. Regulatory Flexibility Act
This rule is expected to have a beneficial impact on small business
concerns. An initial regulatory flexibility analysis has been prepared
[[Page 55987]]
consistent with 5 U.S.C. 603. The analysis is summarized as follows:
This interim rule amends the DFARS to implement Section 801 of the
National Defense Authorization Act for Fiscal Year 2004. Section 801
adds 10 U.S.C. 2382, which places restrictions on the consolidation of
two or more requirements of a DoD department, agency, or activity into
a single solicitation and contract, when the total value of the
requirements exceeds $5,000,000. The objective of the rule is to ensure
that decisions regarding consolidation of contract requirements are
made with a view toward providing small business concerns with
appropriate opportunities to participate in DoD procurements as prime
contractors and subcontractors. The rule does not duplicate, overlap,
or conflict with any other Federal rules. DoD considers the
restrictions on consolidation of contract requirements to be separate
and distinct from the restrictions on contract bundling specified in
the Federal Acquisition Regulation. There are no significant
alternatives that would accomplish the objectives of 10 U.S.C. 2382.
The impact on small entities is expected to be positive.
A copy of the analysis may be obtained from the point of contact
specified herein. DoD invites comments from small businesses and other
interested parties. DoD also will consider comments from small entities
concerning the affected DFARS subparts in accordance with 5 U.S.C. 610.
Such comments should be submitted separately and should cite DFARS Case
2003-D109.
C. Paperwork Reduction Act
The Paperwork Reduction Act does not apply because the rule does
not impose any information collection requirements that require the
approval of the Office of Management and Budget under 44 U.S.C. 3501,
et seq.
D. Determination To Issue an Interim Rule
A determination has been made under the authority of the Secretary
of Defense that urgent and compelling reasons exist to publish an
interim rule prior to affording the public an opportunity to comment.
This interim rule implements Section 801 of the National Defense
Authorization Act for Fiscal Year 2004 (Public Law 108-136). Section
801 provides that a DoD department, agency, or activity may not execute
an acquisition strategy that includes a consolidation of contract
requirements with a total value exceeding $5,000,000, unless the senior
procurement executive concerned conducts market research, identifies
any alternative contracting approaches that would involve a lesser
degree of consolidation, and determines that the consolidation is
necessary and justified. Comments received in response to this interim
rule will be considered in the formation of the final rule.
List of Subjects in 48 CFR Parts 207 and 219
Government procurement.
Michele P. Peterson,
Executive Editor, Defense Acquisition Regulations Council.
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Therefore, 48 CFR parts 207 and 219 are amended as follows:
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1. The authority citation for 48 CFR parts 207 and 219 continues to
read as follows:
Authority: 41 U.S.C. 421 and 48 CFR Chapter 1.
PART 207--ACQUISITION PLANNING
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2. Sections 207.170 through 207.170-3 are added to read as follows:
207.170 Consolidation of contract requirements.
207.170-1 Scope.
This section implements 10 U.S.C. 2382.
207.170-2 Definitions.
As used in this section--
Consolidation of contract requirements means the use of a
solicitation to obtain offers for a single contract or a multiple award
contract to satisfy two or more requirements of a department, agency,
or activity for supplies or services that previously have been provided
to, or performed for, that department, agency, or activity under two or
more separate contracts lower in cost than the total cost of the
contract for which the offers are solicited.
Multiple award contract means--
(1) A multiple award schedule issued by the General Services
Administration as described in FAR Subpart 8.4;
(2) A multiple award task order or delivery order contract issued
in accordance with FAR Subpart 16.5; or
(3) Any other indefinite-delivery, indefinite-quantity contract
that an agency enters into with two or more sources for the same line
item under the same solicitation.
207.170-3 Policy and procedures.
(a) Agencies shall not consolidate contract requirements with a
total value exceeding $5,000,000 unless the acquisition strategy
includes--
(1) The results of market research;
(2) Identification of any alternative contracting approaches that
would involve a lesser degree of consolidation; and
(3) A determination by the senior procurement executive that the
consolidation is necessary and justified.
(i) Market research may indicate that consolidation of contract
requirements is necessary and justified if the benefits of the
acquisition strategy substantially exceed the benefits of each of the
possible alternative contracting approaches. Benefits include costs
and, regardless of whether quantifiable in dollar amounts--
(A) Quality;
(B) Acquisition cycle;
(C) Terms and conditions; and
(D) Any other benefit.
(ii) Savings in administrative or personnel costs alone do not
constitute a sufficient justification for a consolidation of contract
requirements unless the total amount of the cost savings is expected to
be substantial in relation to the total cost of the procurement.
(b) Include the determination made in accordance with paragraph
(a)(3) of this section in the contract file.
PART 219--SMALL BUSINESS PROGRAMS
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3. Section 219.201 is amended by adding paragraph (d)(11) to read as
follows:
219.201 General policy.
* * * * *
(d) * * *
(11) Also conduct annual reviews to assess--
(A) The extent of consolidation of contract requirements that has
occurred (see 207.170); and
(B) The impact of those consolidations on the availability of small
business concerns to participate in procurements as both contractors
and subcontractors.
* * * * *
[FR Doc. 04-21017 Filed 9-16-04; 8:45 am]
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