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FEDERAL CONTRACTS PERSPECTIVE

Federal Acquisition Developments, Guidance, and Opinions


March 2010
Vol. XI, No. 3

CONTENTS


Inflation Adjustments Proposed for Acquisition Thresholds
Veteran Business Status Verification Rule Finalized
USDA Proposes Another Nine Biobased Items
DOD Addresses Procurements on Its Behalf, Competition
GSAR Part 512 Rewritten



Inflation Adjustments Proposed
for Acquisition Thresholds

Every five years, statutory-based acquisition-related thresholds are required to be adjusted for inflation except for Davis-Bacon Act, Service Contract Act, and trade agreements thresholds. This requirement is in Section 807 of the Ronald W. Reagan National Defense Authorization Act for Fiscal Year (FY) 2005 (Public Law 108-375), and it requires an adjustment in years evenly divisible by five using the Consumer Price Index for all urban consumers. This proposed rule would make the required adjustments to the statutory-based acquisition thresholds. In addition, this proposed rule would use the same methodology to adjust nonstatutory acquisition-related thresholds – that is, those thresholds in the Federal Acquisition Regulation (FAR) that have their origin in executive orders or regulations. However, this proposed rule does not address those thresholds that are not considered “acquisition-related,” such as those related to claims, penalties, withholding, payments, required levels of insurance, small business size standards, liquidated damages, etc. Finally, changes to cost accounting standards (CAS) thresholds will be dealt with separately.

The following are the adjustments that would be made to the most heavily-used thresholds by this rule:

The $3,000 micro-purchase base threshold in FAR 2.101 would be unchanged, and the threshold for FedBizOpps preaward and post-award notices in FAR Part 5, Publicizing Contract Actions, would remain at $25,000 because of the trade agreements.

Some other important thresholds that would be changed are:

Comparable changes would be made to corresponding provisions and clauses in FAR Part 52, Solicitation Provisions and Contract Clauses.

Comments on the proposed rule must be submitted no later than April 5, 2010, by any of the following means: (1) eRulemaking Portal: http://www.regulations.gov; (2) fax: 202-501-4067; or (3) mail: General Services Administration, Regulatory Secretariat (MVPR), 1800 F Street, NW, Room 4041, ATTN: Hada Flowers, Washington, DC 20405. Identify comments as “FAR Case 2008-024.”



Veteran Business Status Verification Rule Finalized

The Department of Veterans Affairs (VA) has finalized, with changes, its interim final rule that added a new Part 74, Veterans Small Business Regulations, to Title 38, Pensions, Bonuses, and Veterans’ Relief, of the Code of Federal Regulations (38 CFR Part 74). Part 74 requires veteran-owned small businesses (VOSB), including service-disabled veteran-owned small businesses (SDVOSB), to register in the VetBiz.gov Vendor Information Pages (VIP) database to be eligible to participate in set-asides for SDVOSBs and VOSBs issued by VA contracting officers. In addition, Part 74 requires VA contracting officers to verify ownership and control of VOSB and SDVOSB.

The final version of the rule differs in several ways from the interim final rule:

For more on the interim final rule, see the June 2008 Federal Contracts Perspective article “New Regs Address Veterans' Employment, Ownership.”



USDA Proposes Another Nine Biobased Items

The United States Department of Agriculture (USDA) is proposing to add nine more sections to Title 7 of the Code of Federal Regulations (CFR), Part 2902, Guidelines for Designating Biobased Products for Federal Procurement (7 CFR Part 2902), to identify nine more biobased products to be given preference in federal procurements as provided under Section 9002 of the Farm Security and Rural Investment Act of 2002 (FSRIA), and to specify the minimum level of biobased content to be contained in the procured products.

The following are the proposed new designated items and their Title 7 section numbers:

     2902.52, Disposable tableware
     2902.53, Expanded polystyrene (EPS) foam recycling products
     2902.54, Heat transfer fluids
     2902.55, Ink removers and cleaners
     2902.56, Mulch and compost materials
     2902.57, Multipurpose lubricants
     2902.58, Office paper
     2902.59, Topical pain relief products
     2902.60, Turbine drip oils

As a general rule, procuring agencies must purchase biobased products within these designated items where the purchase price of the procurement item exceeds $10,000 or where the quantity of such items or functionally equivalent items purchased over the preceding fiscal year equaled $10,000 or more, unless products within a designated item: (1) are not reasonably available within a reasonable period of time; (2) fail to meet the reasonable performance standards of the procuring agencies; or (3) are available only at an unreasonable price. The $10,000 threshold applies to federal agencies as a whole and not to agency subgroups such as regional offices or subagencies of the larger federal department or agency.

For more information on the biobased program, all the products in the program, and those proposed for inclusion, go to http://www.biopreferred.gov/. Also see the February 2005 Federal Contracts Perspective article “USDA Publishes Biobased Products Guidelines,” the April 2006 Federal Contracts Perspective article “USDA Designates Six Biobased Products for Procurement,” the September 2006 Federal Contracts Perspective article “USDA Proposes 20 More Biobased Products,” the November 2006 Federal Contracts Perspective article “10 More Biobased Items Proposed,” the June 2008 Federal Contracts Perspective article “USDA Adds 27 Items to Biobased Products List, Exempts DOD and NASA from Requirements,” the November 2008 Federal Contracts Perspective article "Nine More Biobased Items Proposed," and the November 2009 Federal Contracts Perspective article “USDA Adds Nine More Biobased Items.”



DOD Addresses Procurements on Its Behalf, Competition

The Department of Defense (DOD) took it relatively easy during February, finalizing one interim Defense FAR Supplement (DFARS) rule, issuing another interim rule, and issuing two deviations.



GSAR Part 512 Rewritten

The General Services Administration (GSA) is adopting the proposed rewrite of GSA Acquisition Regulation (GSAR) Part 512, Commercial Items, as final with changes.

The proposed rule would have revised paragraph (a) of GSAR 512.301, Solicitation Provisions and Contract Clauses for the Acquisition of Commercial Items, to delete prescriptions for GSAR 552.212-70, Preparation of Offer (Multiple Award Schedule), and GSAR 552.212-73, Evaluation – Commercial Items (Multiple Award Schedule), both of which would be relocated to GSAR Part 538, Federal Supply Schedule Contracting, where they are more appropriate.

Based on comments, paragraph (b), “Use of Required Provisions and Clauses,” is deleted, and paragraphs (c) and (d) are redesignated as paragraphs (b) and (c), respectively. A new paragraph (d) requires that commercial item solicitations issued in conjunction with FAR Part 14, Sealed Bidding, or FAR Part 15, Contracting by Negotiation, include two notices (acquisitions of leasehold interests in real property, must include only the first notice):

           “The information collection requirements contained in this solicitation/contract are either required by regulation or approved by the Office of Management and Budget pursuant to the Paperwork Reduction Act and assigned OMB Control No. 3090-0163.”
           “The General Services Administration's hours of operation are 8 a.m. to 4:30 p.m. Requests for preaward debriefings postmarked or otherwise submitted after 4:30 p.m. will be considered submitted the following business day. Requests for postaward debriefings delivered after 4:30 p.m. will be considered received and filed the following business day.”

For more on the proposed rule, see the September 2008 Federal Contracts Perspective article “GSAR Rewrite Begins to Show Results.”



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