[Federal Register Volume 70, Number 146 (Monday, August 1, 2005)]
[Notices]
[Pages 44130-44131]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 05-15155]
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OFFICE OF MANAGEMENT AND BUDGET
Executive Office of the President; Performance of Commercial
Activities
AGENCY: Office of Management and Budget (OMB), Executive Office of the
President.
ACTION: Update to Federal Pay Raise Assumptions, Inflation Factors, and
Costing Software Used in OMB Circular No. A-76, ``Performance of
Commercial Activities.''
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SUMMARY: OMB is updating the annual federal pay raise assumptions and
inflation cost factors used for computing the government's personnel
and non-pay costs in public-private competitions conducted pursuant to
Office of Management and Budget (OMB) Circular A-76. These annual pay
raise assumptions and inflation factors are based on the President's
Budget for Fiscal Year 2006. OMB is also providing notice of an update
to ``COMPARE,'' the costing software agencies use when conducting
public-private competitions.
DATES: Effective date: These changes are effective immediately and
shall apply to all public-private competitions performed in accordance
with OMB Circular A-76, as revised in May 2003, where the performance
decision has not been certified by the government before this date.
FOR FURTHER INFORMATION CONTACT: Mathew Blum, Office of Federal
Procurement Policy (OFPP), NEOB, Room 9013, Office of Management and
Budget, 725 17th Street, NW., Washington, DC 20503, Tel. No. 202-395-
4953.
Availability: Copies of OMB Circular A-76 may be obtained on the
Internet at the OMB home page at www.whitehouse.gov/omb/circulars/index.html#numerical. Paper copies of the Circular may be obtained by
calling OFPP (tel: (202) 395-7579). The COMPARE software may be
accessed at http://www.compareA76.com.
Joshua B. Bolten,
Director.
Memorandum for the Heads of Executive Departments and Agencies
From: Joshua B. Bolten, Director.
Subject: Update of Annual Federal Pay Raise Assumptions, Certain
Inflation Factors, and Costing Software Used in OMB Circular A-76,
Performance of Commercial Activities.
This memorandum updates the annual federal pay raise assumptions
and inflation cost factors used for computing the government's
personnel and non-pay costs in public-private competitions conducted
pursuant to Office of Management and Budget (OMB) Circular A-76. These
annual pay raise assumptions and inflation factors are based on the
President's Budget for Fiscal Year 2006. The memorandum also provides
notice of an update to ``COMPARE.'' COMPARE is the software agencies
use to calculate costs and document performance decisions in public-
private competitions.
1. Federal pay raise assumptions. The following Federal pay raise
assumptions (including geographic pay differentials) that are in effect
for 2005 shall be used for the development of government personnel
costs. The pay raise factors provided for 2006 and beyond shall be
applied to all government personnel with no assumption being made as to
how they will be distributed between possible locality and base pay
increases.
Federal Pay Raise Assumptions*
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Civilian Military
Effective date (percent) (percent)
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January 2005.................................... 3.5 3.5
January 2006.................................... 2.3 3.1
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* Federal pay raise assumptions have not been established for pay raises
subsequent to January 2006. For January 2007 and beyond, the projected
percentage change in the Employment Cost Index (ECI), 4.2 percent
should be used to estimate government personnel costs for public-
private competitions. In future updates to cost factors in the
Circular, as pay policy for years subsequent to 2006 is established,
these pay raise assumptions will be revised.
2. Inflation factors. The following non-pay inflation cost factors
are provided for purposes of public-private competitions conducted
pursuant to Circular A-76 only. They reflect the generic non-pay
inflation assumptions used to develop the fiscal year 2006 budget
baseline estimates required by law. The law requires that a specific
inflation factor (GDP FY/FY chained price index) be used for this
purpose. These inflation factors should not be viewed as estimates of
expected inflation rates for major long-term procurement items or as an
estimate of inflation for any particular agency's non-pay purchases
mix.
Non-Pay Categories
[Supplies, equipment, etc.]
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(percent)
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FY 2005..................................................... 2.0
FY 2006..................................................... 2.0
FY 2007..................................................... 2.1
FY 2008..................................................... 2.1
FY 2008..................................................... 2.1
FY 2010..................................................... *2.1
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* Any subsequent years included in the period of performance shall
continue to use the 2.1% figure, until otherwise revised by OMB.
3. COMPARE Update. Revisions to Circular A-76, issued by OMB in May
2003, require agencies to use ``COMPARE'' when calculating costs in
public-private competitions. This software incorporates the costing
procedures of the revised Circular to ensure all agencies calculate and
document the costs of public and private sector performance in a
standardized manner when conducting public-private competitions under
the Circular. The Department of Defense (DOD) maintains COMPARE on
OMB's behalf.
DOD has completed a version update to COMPARE. COMPARE Version 2.1:
(1) Improves the functionality of the software, (2) applies updated tax
rate information (i.e., from the updated tax
[[Page 44131]]
rate table) to establish the adjusted cost of private sector
performance, (3) fully automates the calculation of contract
administration costs to ensure consistent agency application of this
factor in competitions, and (4) updates terminology to reflect changes
made when the Circular was revised in May 2003. The software also
provides an optional baseline costing capability that may be used at an
agency's discretion or as otherwise prescribed in agency guidance
(e.g., for determining preliminary planning baseline costs and
evaluating savings from completed competitions).
COMPARE Version 2.1 replaces Version 2.0 and interim instructions
issued when OMB revised the Circular. Agencies shall use COMPARE
Version 2.1 to calculate costs for all public-private competitions
performed pursuant to the revised Circular A-76 where a performance
decision has not been certified by the government by the effective date
identified in the Federal Register notice accompanying the publication
of this memorandum. As explained above, however, the baseline costing
feature is currently optional and may be used at the agency's
discretion or as otherwise prescribed in agency guidance.
COMPARE Version 2.1. and updated tables are located at http://www.compareA76.com.
[FR Doc. 05-15155 Filed 7-29-05; 8:45 am]
BILLING CODE 3110-01-P