[Federal Register Volume 72, Number 244 (Thursday, December 20, 2007)]
[Proposed Rules]
[Pages 72325-72326]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E7-24730]
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DEPARTMENT OF DEFENSE
GENERAL SERVICES ADMINISTRATION
NATIONAL AERONAUTICS AND SPACE ADMINISTRATION
48 CFR Part 31
[FAR Case 2006-024; Docket 2007-0001; Sequence 12]
RIN: 9000-AK86
Federal Acquisition Regulation; FAR Case 2006-024, Travel Costs
AGENCIES: Department of Defense (DoD), General Services Administration
(GSA), and National Aeronautics and Space Administration (NASA).
ACTION: Proposed rule.
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SUMMARY: The Civilian Agency Acquisition Council and the Defense
Acquisition Regulations Council (Councils) are proposing to amend the
Federal Acquisition Regulation (FAR) to change the travel cost
principle to ensure a consistent application of the limitation on
allowable contractor airfare costs.
DATES: Interested parties should submit written comments to the FAR
Secretariat on or before February 19, 2008 to be considered in the
formulation of a final rule.
ADDRESSES: Submit comments identified by FAR case 2006-024 by any of
the following methods:
Federal eRulemaking Portal: http://www.regulations.gov.
To search for any document, first select under ``Step 1,''
``Documents with an Open Comment Period'' and select under ``Optional
Step 2,'' ``Federal Acquisition Regulation'' as the agency of choice.
Under ``Optional Step 3,'' select ``Proposed Rules''. Under ``Optional
Step 4,'' from the drop down list, select ``Document Title'' and type
the FAR case number ``2006-024''. Click the ``Submit'' button. Please
include your name and company name (if any) inside the document.
You may also search for any document by clicking onthe ``Search for
Documents'' tab at the top of the screen. Select from the agency field
``Federal Acquisition Regulation'', and type ``2006-024'' in the
``Document Title'' field. Select the ``Submit'' button.
[[Page 72326]]
Fax: 202-501-4067.
Mail: General Services Administration, Regulatory
Secretariat (VIR), 1800 F Street, NW, Room 4035, ATTN: Diedra Wingate,
Washington, DC 20405.
Instructions: Please submit comments only and cite FAR case 2006-
024 in all correspondence related to this case. All comments received
will be posted without change to http://www.regulations.gov, including
any personal and/or business confidential information provided.
FOR FURTHER INFORMATION CONTACT Mr. Edward Chambers, Procurement
Analyst, at (202) 501-3221 for clarification of content. For
information pertaining to status or publication schedules, contact the
FAR Secretariat at (202) 501-4755. Please cite FAR case 2006-024.
SUPPLEMENTARY INFORMATION:
A. Background
The travel cost principle at FAR 31.205-46(b) currently limits
allowable contractor airfare costs to ``the lowest customary standard,
coach, or equivalent airfare offered during normal business hours.''
The Councils are aware that this limitation is being interpreted
inconsistently, either as lowest coach fare available to the contractor
or lowest coach fare available to the general public, and these
inconsistent interpretations can lead to confusion regarding what costs
are allowable.
The Councils agreed that the current language at FAR 31.205-46(b)
does not promote consistency in the application of the cost principle
and that, accordingly, the cost principle requires clarification. The
Councils considered three alternative approaches to revising the cost
principle:
1. Do nothing, leaving FAR 31.205-46 unchanged;
2. Amend FAR 31.205-46(b) to explicitly state that allowable
contractor airfare costs are limited to the lowest standard or coach
fare available to the general public; or
3. Amend FAR 31.205-46(b) to explicitly state that allowable
contractor airfare costs are limited to the lowest standard or coach
fare available to the contractor.
With regard to the first option, the Councils do not believe that
the cost principle can be left unchanged based on the different
interpretations of which the Councils have become aware. The Councils
also believe that establishing the lowest coach fare available to the
general public as the benchmark for cost allowability is not a feasible
option in practice. Under such a standard, contractors could
potentially be required to continuously monitor a fluctuating fare
market to determine what was the lowest fare available on a given day.
Likewise, Government auditors could not reasonably recreate the
competitive fare market for each instance of a contractor's travel in
determining compliance with the cost principle.
Accordingly, the Councils believe that the reasonable standard to
apply in determining the allowability of airfares is the lowest coach
fare available to the contractor. It is not prudent to allow the costs
of the lowest coach fares available to the general public when
contractors have obtained lower fares as a result of direct
negotiation.
Furthermore, the Councils believe that the cost principle should be
clarified to omit the term ``standard'' from the description of the
classes of allowable airfares since that term does not describe actual
classes of airline service. The Councils believe that ``customary
coach, or equivalent'' more accurately describes the classes of service
for which the cost will be considered allowable.
This is not a significant regulatory action and, therefore, was not
subject to review under Section 6(b) of Executive Order 12866,
Regulatory Planning and Review, dated September 30, 1993. This rule is
not a major rule under 5 U.S.C. 804.
B. Regulatory Flexibility Act
The Councils do not expect this proposed rule to have a significant
economic impact on a substantial number of small entities within the
meaning of the Regulatory Flexibility Act, 5 U.S.C. 601, et seq.,
because most contracts awarded to small entities use simplified
acquisition procedures or are awarded on a competitive, fixed-price
basis, and do not require application of the cost principles and
procedures discussed in this rule. An Initial Regulatory Flexibility
Analysis has, therefore, not been performed. We invite comments from
small businesses and other interested parties. The Councils will
consider comments from small entities concerning the affected FAR Part
31 in accordance with 5 U.S.C. 610. Interested parties must submit such
comments separately and should cite 5 U.S.C. 601, et seq. (FAR case
2006-024), in correspondence.
C. Paperwork Reduction Act
The Paperwork Reduction Act does not apply because the proposed
changes to the FAR do not impose information collection requirements
that require the approval of the Office of Management and Budget under
44 U.S.C. 3501, et seq.
List of Subjects in 48 CFR Part 31
Government procurement.
Dated: December 10, 2007.
Al Matera,
Director, Office of Acquisition Policy.
Therefore, DoD, GSA, and NASA propose amending 48 CFR part 31 as
set forth below:
PART 31--CONTRACT COST PRINCIPLES AND PROCEDURES
1. The authority citation for 48 CFR part 31 continues to read as
follows:
Authority: 40 U.S.C. 121(c); 10 U.S.C. chapter 137; and 42
U.S.C. 2473(c).
2. Amend section 31.205-46 by revising paragraph (b) to read as
follows:
31.205-46 Travel costs.
* * * * *
(b) Airfare costs, in excess of the lowest priced coach class, or
equivalent, airfare available to the contractor during normal business
hours are unallowable except when such accommodations require
circuitous routing, require travel during unreasonable hours,
excessively prolong travel, result in increased cost that would offset
transportation savings, are not reasonably adequate for the physical or
medical needs of the traveler, or are not reasonably available to meet
mission requirements. However, in order for airfare costs in excess of
the above airfare to be allowable, the applicable condition(s) set
forth above must be documented and justified.
* * * * *
[FR Doc. E7-24730 Filed 12-19-07; 8:45 am]
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