[Federal Register Volume 74, Number 125 (Wednesday, July 1, 2009)]
[Rules and Regulations]
[Pages 31557-31561]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E9-15436]
[[Page 31557]]
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DEPARTMENT OF DEFENSE
GENERAL SERVICES ADMINISTRATION
NATIONAL AERONAUTICS AND SPACE ADMINISTRATION
48 CFR Parts 2, 8, 9, 13, 17, 36, 42, and 53
[FAC 2005-34; FAR Case 2006-022; Item I; Docket 2008-0002; Sequence 2]
RIN 9000-AK99
Federal Acquisition Regulation; FAR Case 2006-022, Contractor
Performance Information
AGENCIES: Department of Defense (DoD), General Services Administration
(GSA), and National Aeronautics and Space Administration (NASA).
ACTION: Final rule.
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SUMMARY: The Civilian Agency Acquisition Council and the Defense
Acquisition Regulations Council (Councils) have agreed on a final rule
amending the Federal Acquisition Regulation (FAR) to revise the
contractor performance information process. This change primarily
emphasizes the use of a standard performance information reporting
system, the Past Performance Information Retrieval System (PPIRS). This
change aligns with the President's March 4, 2009 Memorandum on
Government Contracting specifically with regards to managing the
Government's risk associated with the goods and services being procured
and ensuring projects are completed effectively and efficiently.
DATES: Effective Date: July 1, 2009.
FOR FURTHER INFORMATION CONTACT: For clarification of content, contact
Ms. Jeritta Parnell, Procurement Analyst, at (202) 501-4082. For
information pertaining to status or publication schedules, contact the
Regulatory Secretariat at (202) 501-4755. Please cite FAC 2005-34, FAR
case 2006-022.
SUPPLEMENTARY INFORMATION:
A. Background
Past performance information (PPI) can decrease the Government's
risk in contracting by rating, at a minimum, quality of work,
timeliness, cost, and business relations of contractors for projects
above a specified threshold. PPI incentivizes contractors to perform
well in order to be rewarded with future contracts.
The Office of Federal Procurement Policy (OFPP) and the Chief
Acquisition Officer's Acquisition Council for E-GOV (ACE) established a
working group to review regulations, policies, and guidance associated
with contractor performance information. The working group proposed
changes to a number of FAR parts. The Councils have agreed to some, but
not all the changes under this final rule.
The purpose of the final rule is to ensure that the FAR clearly
reflects the use of the Governmentwide performance information
repository, Past Performance Information Retrieval System (PPIRS) at
http://www.ppirs.gov; requires the evaluation of past performance for
orders exceeding the simplified acquisition threshold placed against
Federal Supply Schedule contracts, or under a task order or delivery
order against a contract awarded by another Federal agency (i.e.
Governmentwide acquisition contract or multi-agency contract);
recommends past performance information for orders under single agency
contracts; consolidates the collection of past performance guidance in
FAR Part 42; and, clarifies that the Agency shall identify those
responsible for preparing interim and final evaluations.
The Councils published a proposed rule with request for comments in
the Federal Register at 73 FR 17945, April 2, 2008. Forty comments from
ten respondents were received.
B. Discussion of Public Comments
The comments received were grouped under five general topics. A
summary of these topics and a discussion of the comments and the
changes made to the proposed rule as a result of those comments are
provided below:
Miscellaneous Comments
Comment: One Respondent recommended adding a definition for
``completed contracts'' under FAR 2.101.
Response: The definition of past performance is revised from
``completed contracts'' to ``physically completed contracts.''
Comment: One respondent disagreed with the revisions as written in
the third person.
Response: In this particular instance, third person is appropriate.
There was no change made to the final rule as a result of this comment.
Comment: Two respondents suggested adding language to include the
FAR clause 52.219-8, Utilization of Small Business Concerns, as well as
the FAR clause 52.219-9, Small Business Subcontracting Plan, which
requires an assessment of the other nine elements of a subcontracting
plan and utilizing small businesses.
Response: This case addresses goals as required by FAR 52.219-9.
This case continues the current FAR focus on compliance with the goals.
There was no change made to the final rule as a result of this comment.
Comment: One respondent recommended that past performance
assessments should address small business utilization as a whole in
addition to subcontracting plan requirements by referencing FAR 52.219-
8 and 52.219-16.
Response: It is not beneficial to further reference FAR 52.219-8,
Utilization of Small Business Concerns, as addressed in the preceding
comment and response. Furthermore, it is not beneficial to include a
reference to FAR 52.219-16, Liquidated Damages--Subcontracting Plan,
since this clause establishes procedures for the payment of liquidated
damages in the event that the contractor failed to meet the
requirements established under FAR 52.219-9, and does not set forth
contractual performance requirements that may be assessed. There was no
change made to the final rule as a result of this comment.
Comment: One respondent suggested that the requirement for the
inclusion of FAR 52.219-9, Small Business Subcontracting, be excepted
for delivery or task orders against Federal Supply Schedules or
Governmentwide contracts.
Response: Contractor subcontracting plans under Federal Supply
Schedules and Governmentwide contracts are established on a contract
level, not task order level. The Councils agree that it would be
inappropriate to require an evaluation of contractor performance for
individual task orders against a small business subcontracting plan
that has been established on a contract level for Federal Supply
Schedules and Governmentwide contracts. Contracting officers may
include such an assessment on single agency task order and delivery
order contracts when deemed appropriate. FAR 42.1502(c) and (d) are
revised to reflect this change.
Comment: One respondent indicated support for the proposed rule as
written.
Response: The Councils have noted this comment.
Past Performance Information Retrieval System (PPIRS)
Comment: One respondent recommended two changes - changing from the
``Government wide Past Performance Information Retrieval System
(PPIRS)'' to the ``Government wide past Performance Information
Retrieval System-Report Card (PPIRS-RC),'' and adding an additional
[[Page 31558]]
paragraph to reference the PPIRS-Report Card.
Response: PPIRS is the universally accepted database used by all
agencies. The FAR does not preclude the usage of additional systems.
There was no change made to the final rule as a result of this comment.
Comment: One respondent suggested revising the performance
information system to improve access to provide more timely, accurate
and detailed performance assessments for acquisition personnel.
Response: These kinds of improvements to the past performance
system are outside the scope of this case. This rule, however, will
improve the contractor performance information process. There was no
change made to the final rule as a result of this comment.
Comment: Two respondents suggested including a reference to PPIRS
in FAR 15.305(a)(2).
Response: There was no intent to change the evaluation criteria set
forth in FAR 15.305. There was no change made to the final rule as a
result of this comment.
Comment: One respondent recommended moving the language from FAR
42.1503(e) to FAR Part 15 since this language appears to be information
regarding source selection.
Response: This language deals with retention of past performance
information rather than required procedures to be utilized in a source
selection, and is therefore a post award function that is appropriately
retained in FAR 42.1503(e). There was no change made to the final rule
as a result of this comment.
Comment: One respondent recommended clarification for information
retention. The respondent suggested the following language: ``Agencies
shall not retain past performance information longer than three years
(six years for construction and architect engineer contracts.)''
Response: These documents are part of the official contract file
and must be retained. The intent of this language is to ensure that
past performance data is current and relevant. The use of the past
performance information that may be obtained from PPIRS for acquisition
evaluations is limited to the 3-year timeframe (six years for
construction and architect engineer contracts). PPIRS archives past
performance data three years after the data is input into PPIRS. There
was no change made to the final rule as a result of this comment.
Comment: One respondent questioned the period of retention of past
performance information for construction.
Response: This language was merely consolidated and relocated under
FAR Part 42 without change. Due to the nature of construction and A&E
contracts, retention of such past performance information is
necessarily longer than for contracts for other products/services.
There was no change made to the final rule as a result of this comment.
Comment: One respondent suggested the wording is unclear in FAR
42.1503(e).
Response: The language was revised to delete ``For source selection
purposes'' to clarify that this is a post award function rather than a
source selection function.
Comment: One respondent suggested adding another paragraph to FAR
42.1503 to address information retention.
Response: Previous FAR language regarding retaining records is
outdated. Rather than being destroyed, PPIRS electronic records will be
retained through archiving beyond the specified 3 and 6 year
timeframes. The language was revised at the time of the proposed rule
to reflect timeframes for access and use of this information. There was
no change made to the final rule as a result of this comment.
Past Performance Reporting
Comment: One respondent recommended changing the term
``evaluation'' to ``assessment'' or ``report card.''
Response: The terms ``evaluation'' and ``assessment'', as used in
FAR Part 42, are synonymous in this context. There was no change made
to the final rule as a result of this comment.
Comment: One respondent would like a clarification to the language
that states that agencies shall submit past performance reports
electronically to PPIRS in accordance with agency procedures.
Response: The intent of the language is to require submission of
past performance evaluations to PPIRS in a method prescribed under
agency procedures. The language at FAR 42.1503(c) has been revised to
clarify that the process for submitting such reports to PPIRS shall be
in accordance with agency procedures.
Comment: One respondent recommended additional language in the last
sentence of FAR 42.1502(a) as follows: ``The content and format of
performance evaluations shall be established in accordance with agency
procedures and should be tailored to the size, content, and complexity
of the requirements.''
Response: The Councils interpret the intent of the comment was to
obtain greater detail in the evaluations. The language is sufficient as
proposed. There was no change made to the final rule as a result of
this comment.
Comment: One respondent suggested expanding the case to cover
responsibilities for negative past performance information received
from surveys or questionnaires.
Response: The FAR already has sufficient provisions allowing
contracting officers to discuss negative past performance information
with offerors. There was no change made to the final rule as a result
of this comment.
Comment: One respondent suggested that some form of incentive or
other documented means be provided to encourage and ensure that
information is timely provided into the system.
Response: This is a requirement of agencies in the normal course of
duties assigned to their designated personnel as required in FAR
42.1502 and 42.1503. As such, an additional incentive would be
inappropriate. There was no change made to the final rule as a result
of this comment.
Comment: Three respondents suggested that the identification of an
``individual'' responsible for preparing evaluations is too restrictive
and recommended flexibility for each agency to determine the
responsible individual or individuals by title or organizational
element.
Response: The Councils agree with the comment. The language at FAR
42.1503(a) is revised to read ``Agency procedures shall identify those
responsible for preparing interim and final evaluations.''
Comment: One respondent recommended that past performance
evaluations should be required for all contracts that are terminated
for default.
Response: The Councils have noted this comment and will consider
this issue under a separate rule. There was no change made to the final
rule as a result of this comment.
Past Performance Evaluation
Comment: One respondent recommended that evaluations over the
simplified acquisition threshold be submitted when ``an extraordinary
event or occurrence takes place.'' Furthermore, the respondent
questioned the value of performance evaluations on each order over the
simplified acquisition threshold.
Response: The information is necessary and required. There was no
change made to the final rule as a result of this comment.
[[Page 31559]]
Comment: One respondent suggested a change to the mandatory
evaluation of orders over the simplified acquisition threshold from
``shall'' to ``may.''
Response: The Councils do not agree with changing ``shall'' to
``may.'' It is the intent of this rule to capture the universe of
contracts which includes task orders against basic contracts. Likewise,
nothing prevents prudent contracting officers from addressing
extraordinary circumstances on contracts under the simplified
acquisition threshold where a past performance evaluation may be
warranted. There was no change made to the final rule as a result of
this comment.
Comment: Two respondents recommended revising FAR 13.106-
2(b)(3)(ii) to read ``May be based on one or more of the following:''
to encourage contracting officers to use more than one tool in
identifying offerors' past performance information.
Response: The Councils agree with this comment. FAR 13.106-
2(b)(3)(ii) is revised to read ``May be based on one or more of the
following:''
Comment: One respondent suggested that PPIRS is not a mandatory
source of information and that other sources are available.
Response: PPIRS is the universally accepted database used by all
agencies. PPIRS is not the only source for past performance information
that may be utilized in source selection evaluations. However, under
this rule, agencies are now required to submit past performance
information to PPIRS. Agencies will establish procedures to effect
these electronic submissions. There was no change made to the final
rule as a result of this comment.
Comment: One respondent suggested amending FAR 13.106-2(b)(3)(ii)
to include other available sources as previously addressed.
Response: FAR 13.106-2(b)(3)(ii) is revised to read ``May be based
on one or more of the following:''
Comment: Two respondents recommended defining ``relevant past
performance information.''
Response: Relevancy is subjective and should be left to the
contracting officer's discretion on a case by case basis. There was no
change made to the final rule as a result of this comment.
Comment: One respondent suggested providing objective criteria and
weights for acquisition officials.
Response: This requirement is addressed in FAR 15.305(a)(2)(i).
These past performance evaluations are subjective based on the current
acquisition. Assigning weighted values to evaluation criteria,
including past performance, is the purview of the Source Selection
Authority. There was no change made to the final rule as a result of
this comment.
Thresholds
Comment: One respondent recommended that the reference to the
Simplified Acquisition Threshold (SAT) should be limited to the lowest
dollar value for the SAT in the definition of FAR 2.1.
Response: Due to the extraordinary nature of the performance under
contracts that qualify for higher simplified acquisition thresholds, it
would not be appropriate to require the preparation of evaluations at
the lowest SAT for each contract. Agency designated personnel have the
discretion to prepare and submit to PPIRS an evaluation of contractor
performance at any threshold when they deem it appropriate. There was
no change made to the final rule as a result of this comment.
Comment: One respondent suggested that the threshold specific to
orders placed against an FSS, GWAC, or other multi-agency contract be
raised to $550,000 rather than all orders exceeding the SAT.
Response: It is the intent of this rule to capture the universe of
contracts that includes task orders against basic contracts. There was
no change made to the final rule as a result of this comment.
Comment: Two respondents recommended changing the language in FAR
42.1502(c) and 42.1502(d) as follows: ``task order contract or a
delivery order contract'' to ``indefinite-delivery contract.''
Response: The phrase ``task order contract or delivery order
contract'' is more specific. This change was not intended to cover
definite quantity contracts as proposed by the commenter. There was no
change made to the final rule as a result of this comment.
Summary of Changes to the Proposed Rule
The Councils made the following changes to the proposed rule as a
result of the public comments and Council deliberations. The final rule
reflects the following changes:
FAR 2.101
The definition of past performance was revised to clarify the term
``completed contract'' as one that is physically completed in
accordance with FAR 4.804-4.
FAR 8.406-7
The addition of language to advise ordering activities that past
performance evaluations required in FAR 42.1502(c) are applicable to
orders.
FAR 13.106-2
Language was revised to encourage contracting officers to utilize
more than one tool in identifying offerors' past performance
information.
FAR 42.1502(c) and (d)
Language was added to clarify the consideration of small business
goals in past performance evaluations for Governmentwide acquisition
contracts, multi-agency contracts, and single-agency task order and
delivery order contracts.
FAR 42.1503(a)
Language was revised to clarify that agency procedures shall
identify those responsible for preparing interim and final evaluations.
FAR 42.1503(c)
Language was revised to clarify that agencies shall be responsible
for establishing procedures for reporting past performance information
to PPIRS.
FAR 42.1503(e)
Language was revised to delete the phrase ``For source selection
purposes'' in order to clarify that this language deals with retention
of past performance information rather than required procedures to be
utilized in a source selection.
C. Regulatory Analyses
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 is not a
major rule under 5 U.S.C. 804.
D. Regulatory Flexibility Act
The Department of Defense, the General Services Administration, and
the National Aeronautics and Space Administration certify that this
final rule will not 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 the rule does not
impose any additional requirements on small businesses. The collection
and reporting of past performance information is an internal process to
the Government. The rule merely puts into effect the current practices
of prudent contracting officers. In addition, the rule provides clearer
instruction to contracting officers by restating in a better format the
current language.
E. Paperwork Reduction Act
The Paperwork Reduction Act does not apply because the 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.
Chapter 35, et seq.
[[Page 31560]]
List of Subjects in 48 CFR Parts 2, 8, 9, 13, 17, 36, 42, and 53
Government procurement.
Dated: June 25, 2009.
Al Matera,
Director, Office of Acquisition Policy.
0
Therefore, DoD, GSA, and NASA amend 48 CFR parts 2, 8, 9, 13, 17, 36,
42, and 53 as set forth below:
0
1. The authority citation for 48 CFR parts 2, 8, 9, 13, 17, 36, 42, and
53 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).
PART 2--DEFINITIONS OF WORDS AND TERMS
0
2. Amend section 2.101 in paragraph (b)(2) by adding, in alphabetical
order, the definition ``Past performance'' to read as follows:
2.101 Definitions.
* * * * *
(b) * * *
(2) * * *
Past performance means an offeror's or contractor's performance on
active and physically completed contracts (see 4.804-4).
* * * * *
PART 8--REQUIRED SOURCES OF SUPPLIES AND SERVICES
0
3. Add section 8.406-7 to read as follows:
8.406-7 Contractor Performance Evaluation.
Ordering activities must prepare an evaluation of contractor
performance for each order that exceeds the simplified acquisition
threshold in accordance with 42.1502(c).
PART 9--CONTRACTOR QUALIFICATIONS
0
4. Amend section 9.105-1 by revising the second sentence of the
introductory text of paragraph (c); and removing paragraph (c)(7). The
revised text reads as follows:
9.105-1 Obtaining information.
* * * * *
(c) * * * In addition to the Governmentwide performance information
repository, Past Performance Information Retrieval System (PPIRS) (at
www.ppirs.gov), the contracting officer should use the following
sources of information to support such determinations:
* * * * *
PART 13--SIMPLIFIED ACQUISITION PROCEDURES
0
5. Amend section 13.106-2 by revising paragraph (b)(3)(ii) to read as
follows:
13.106-2 Evaluation of quotations or offers.
* * * * *
(b) * * *
(3) * * *
(ii) May be based on one or more of the following:
(A) The contracting officer's knowledge of and previous experience
with the supply or service being acquired;
(B) Customer surveys, and past performance questionnaire replies;
(C) The Governmentwide Past Performance Information Retrieval
System (PPIRS) at www.ppirs.gov; or
(D) Any other reasonable basis.
* * * * *
PART 17--SPECIAL CONTRACTING METHODS
0
6. Amend section 17.207 by removing from the end of paragraph (c)(3)
the word ``and''; removing the period from the end of paragraph (c)(4)
and adding ``; and'' in its place; and adding paragraph (c)(5) to read
as follows:
17.207 Exercise of options.
* * * * *
(c) * * *
(5) The contractor is not listed on the Excluded Parties List
System (EPLS) (see FAR 9.405-1).
* * * * *
PART 36--CONSTRUCTION AND ARCHITECT-ENGINEER CONTRACTS
0
7. Revise section 36.201 to read as follows:
36.201 Evaluation of contractor performance.
See 42.1502(e) for the requirements for preparing past performance
evaluations for construction contracts.
36.602-3 [Amended]
0
8. Amend section 36.602-3 by removing from paragraph (a) ``36.604'' and
adding ``36.603'' in its place.
0
9. Amend section 36.603 by revising paragraph (d)(4); and removing from
paragraph (d)(5) ``36.604(c)'' and adding ``42.1502(f)'' in its place.
The revised text reads as follows:
36.603 Collecting data on and appraising firms qualifications.
* * * * *
(d) * * *
(4) Assuring that the file contains a copy of each pertinent
performance evaluation (see 42.1502(f)).
* * * * *
0
10. Revise section 36.604 to read as follows:
36.604 Performance evaluation.
See 42.1502(f) for the requirements for preparing past performance
evaluations for architect-engineer contracts.
36.701 [Amended]
0
11. Amend section 36.701 by removing paragraph (d).
36.702 [Amended]
0
12. Amend section 36.702 by removing paragraph (c).
PART 42--CONTRACT ADMINISTRATION AND AUDIT SERVICES
0
13. Revise section 42.1502 to read as follows:
42.1502 Policy.
(a) Past performance evaluations shall be prepared as specified in
paragraphs (b) through (g) of this section at the time the work under
the contract or order is completed. In addition, interim evaluations
shall be prepared as specified by the agencies to provide current
information for source selection purposes, for contracts or orders with
a period of performance, including options, exceeding one year. These
evaluations are generally for the entity, division, or unit that
performed the contract or order. The content of the evaluations should
be tailored to the size, content, and complexity of the contractual
requirements.
(b) Except as provided in paragraphs (e), (f) and (h) of this
section, agencies shall prepare an evaluation of contractor performance
for each contract that exceeds the simplified acquisition threshold.
(c) Agencies shall prepare an evaluation of contractor performance
for each order that exceeds the simplified acquisition threshold placed
against a Federal Supply Schedule contract, or under a task order
contract or a delivery order contract awarded by another agency (i.e.
Governmentwide acquisition contract or multi-agency contract). This
evaluation shall not consider the requirements under paragraph (g) of
this section.
(d) For single-agency task order and delivery order contracts, the
contracting officer may require performance evaluations for each order
in excess of the simplified acquisition threshold when such evaluations
would produce more useful past performance
[[Page 31561]]
information for source selection officials than that contained in the
overall contract evaluation (e.g., when the scope of the basic contract
is very broad and the nature of individual orders could be
significantly different). This evaluation need not consider the
requirements under paragraph (g) of this section unless the contracting
officer deems it appropriate.
(e) Past performance evaluations shall be prepared for each
construction contract of $550,000 or more, and for each construction
contract terminated for default regardless of contract value. Past
performance evaluations may also be prepared for construction contracts
below $550,000.
(f) Past performance evaluations shall be prepared for each
architect-engineer services contract of $30,000 or more, and for each
architect-engineer services contract that is terminated for default
regardless of contract value. Past performance evaluations may also be
prepared for architect-engineer services contracts below $30,000.
(g) Past performance evaluations shall include an assessment of
contractor performance against, and efforts to achieve, the goals
identified in the small business subcontracting plan when the contract
includes the clause at 52.219-9, Small Business Subcontracting Plan.
(h) Agencies shall not evaluate performance for contracts awarded
under Subpart 8.7.
0
14. Amend section 42.1503 by revising paragraphs (a), (c), (d), and (e)
to read as follows:
42.1503 Procedures.
(a) Agency procedures for the past performance evaluation system
shall generally provide for input to the evaluations from the technical
office, contracting office and, where appropriate, end users of the
product or service. Agency procedures shall identify those responsible
for preparing interim and final evaluations. Those individuals
identified may obtain information for the evaluation of performance
from the program office, administrative contracting office, end users
of the product or service, and any other technical or business advisor,
as appropriate. Interim evaluations shall be prepared as required.
* * * * *
(c) Agencies shall submit past performance reports electronically
to the Past Performance Information Retrieval System (PPIRS) at
www.ppirs.gov. The process for submitting such reports to PPIRS shall
be in accordance with agency procedures.
(d) Any past performance information systems used for maintaining
contractor performance information and/or evaluations should include
appropriate management and technical controls to ensure that only
authorized personnel have access to the data.
(e) Agencies shall use the past performance information in PPIRS
that is within three years (six for construction and architect-engineer
contracts) of the completion of performance of the evaluated contract
or order.
PART 53--FORMS
53.236-1 Construction.
0
15. Amend section 53.236-1 by removing and reserving paragraph (a).
0
16. Amend section 53.236-2 by revising the section heading as set forth
below; and removing paragraph (c). The revised text reads as follows:
53.236-2 Architect-engineer services (SF's 252 and 330).
* * * * *
53.301-1420 and 53.301-1421 [Removed]
0
17. Remove sections 53.301-1420 and 53.301-1421.
[FR Doc. E9-15436 Filed 6-30-09; 8:45 am]
BILLING CODE 6820-EP-S