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FEDERAL CONTRACTS PERSPECTIVE

Federal Acquisition Developments, Guidance, and Opinions


September 2006
Vol. VII, No. 9

CONTENTS


New Set-Aside Authorized for Major Disaster or Emergency Assistance Acquisitions
Denett Confirmed as OFPP Administrator
USDA Proposes 20 More Biobased Products
NASA Proposes Information Technology Security Changes
Administrative Changes to the DFARS
Proposed FAR Rules Would Address ID Verification, IPv6



New Set-Aside Authorized for Major Disaster
or Emergency Assistance Acquisitions

Federal Acquisition Circular (FAC) 2005-12 consists of an interim rule that amends the FAR to implement the Local Community Recovery Act of 2006 (Public Law 109-218). The Act amended the Robert T. Stafford Disaster Relief and Emergency Assistance Act to authorize set-asides for major disaster or emergency assistance acquisitions for businesses "that reside or primarily do business in the area affected by the disaster or emergency." Before this rule, contracting officers were directed to give preference, "to the extent feasible and practicable, to those organizations, firms, or individuals residing or doing business primarily in the area affected by such major disaster or emergency." This guidance proved to be inadequate, as the response to Hurricane Katrina showed. So Congress reacted with the passage of the Local Community Recovery Act.

This rule adds FAR Subpart 6.6, Stafford Act Preference for Local Area Contractor, and amends FAR Subpart 26.2, Disaster or Emergency Assistance Activities, to permit contracting officers to set-aside solicitations for debris clearance, distribution of supplies, reconstruction, and other major disaster or emergency assistance for offerors residing or doing business primarily in the geographic area affected by the disaster or emergency (the use of the set-aside is optional).

The following are the key provisions of the FAR revisions:

NOTE: This set-aside is not included in the new FAR Part 18, Emergency Acquisitions (see the August 2006 Federal Contracts Perspective article "New FAR Part Consolidates Emergency Authorities; Earned Value Management Coverage Added"). Undoubtedly this is because the two rules were on separate tracks and happened to be published one month apart. Until a cross-reference is added to FAR Part 18, contracting officers involved in major disaster or emergency assistance acquisitions will have to remember this set-aside exists.



Denett Confirmed as OFPP Administrator

On August 4, the U.S. Senate unanimously confirmed the nomination of Paul A. Denett to be Administrator of the Office of Federal Procurement Policy (OFPP). OFPP plays a central role in shaping the policies and practices federal agencies use to acquire the goods and services they need to carry out their responsibilities. Mr. Denett has served as counselor to the Office of Management and Budget's (OMB) Deputy Director for Management Clay Johnson, providing key guidance to federal agencies to improve agency and program performance (OFPP is part of OMB).

Denett joined OMB after serving from 2003 to 2006 as ESI International's Vice President for Contracting Programs, where he supported contract and acquisition training in both the government and commercial world. From 2001 to 2002, he was program director for Logistics Management Institute (LMI) and focused on the strategic improvement of government acquisition and grant management issues.

Denett is a retired senior executive from the federal service, having served as Director of Administration and Senior Procurement Executive for the Department of the Interior, and as Vice Chairman of the government-wide Procurement Executives Council (PEC), now called the Federal Acquisition Council (FAC).

He received many prestigious awards during his federal career, including a Presidential Rank Award. He has a MSA degree with emphasis in acquisition from George Washington University.

For more on Paul Denett, see the June 2006 Federal Contracts Perspective article "Denett Nominated to be OFPP Administrator," and the July 2006 Federal Contracts Perspective article "Denett Testifies for OFPP Position."



USDA Proposes 20 More Biobased Products

The U.S. Department of Agriculture (USDA) is proposing to add the following 20 sections to Title 7 of the Code of Federal Regulations (CFR) Part 2902, Guidelines for Designating Biobased Products for Federal Procurement, to identify biobased products that would be given preference in federal procurements as provided under Section 9002 of the Farm Security and Rural Investment Act of 2002 (FSRIA), and proposing minimum biobased content for each of these items.

      Section 2902.16, Adhesive and Mastic Removers
      Section 2902.17, Insulating Foam for Wall Construction
      Section 2902.18, Hand Cleaners and Sanitizers
      Section 2902.19, Composite Panels
      Section 2902.20, Fluid-filled Transformers
      Section 2902.21, Biodegradable Containers
      Section 2902.22, Fertilizers
      Section 2902.23, Metalworking Fluids
      Section 2902.24, Sorbents
      Section 2902.25, Graffiti and Grease Removers
      Section 2902.26, 2-Cycle Engine Oils
      Section 2902.27, Lip Care Products
      Section 2902.28, Biodegradable Films
      Section 2902.29, Stationary Equipment Hydraulic Fluids
      Section 2902.30, Biodegradable Cutlery
      Section 2902.31, Glass Cleaners
      Section 2902.32, Greases
      Section 2902.33, Dust Suppressants
      Section 2902.34, Carpets
      Section 2902.35, Carpet and Upholstery Cleaners

Once USDA designates an item under the "Federal Biobased Products Preferred Procurement Program" (FB4P), 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.

Also, USDA is amending 7 CFR 2902 to be consistent with the statutory changes to FSRIA Section 9002 made by the Energy Policy Act of 2005. Those changes make federal contractors expressly subject to the procurement preference provisions of Section 9002 (see the definition of "procuring agency" in Section 2902.2, Definitions). In addition, USDA is amending Part 2902 to: (1) clarify that biobased products from certain designated countries (as defined in FAR 25.003, Definitions) must be treated by procuring agencies as eligible for the procurement preference under FSRIA (see new paragraph (b)(3) of Section 2902.4, Procurement Programs); and (2) clarify that the procurement preference provisions do not apply to purchases of biobased items that are not the direct result of contracts with procuring agencies (see paragraph (d) of Section 2902.3, Applicability to Federal Procurements).

Comments on these proposed and interim rules may be submitted by any of the following methods: (1) http://www.regulations.gov; (2) http://www.biobased.oce.usda.gov; (3) e-mail: fb4p@oce.usda.gov (include "RIN number 0503-AA30" and "Proposed Designation of Items"on the subject line for comments on Sections 2902.16 through 2902.25; "RIN number 0503-AA31" and "Proposed Designation of Items" on the subject line for comments on Sections 2902.26 through 2902.35; and "RIN number 0503-AA26" and "Amendments to Guidelines" on the subject line for comments on the interim rule changes); or (4) mail/commercial/hand delivery to: Marvin Duncan, USDA, Office of the Chief Economist, Office of Energy Policy and New Uses, Room 4059, South Building, 1400 Independence Avenue, SW, MS-3815, Washington, DC 20250-3815. Comments on the 20 proposed biobased products are due October 16, 2006. Comments on the interim rule changes are due August 28, 2006.

For more on the FB4P and the first six biobased items designated by USDA, see the February 2005 Federal Contracts Perspective article "USDA Publishes Biobased Products Guidelines," the August 2005 Federal Contracts Perspective article "Agriculture Proposes Six Biobased Items," and the April 2006 Federal Contracts Perspective article "USDA Designates Six Biobased Products for Procurement."



NASA Proposes Information Technology Security Changes

The National Aeronautics and Space Administration (NASA) is proposing to amend NASA FAR Supplement (NFS) 1852.204-76, Security Requirements for Unclassified Information Technology Resources, to reflect the updated requirements of NASA Procedural Requirements (NPR) 2810, "Security of Information Technology." The NPR was recently revised to address increasing cyber threats and to ensure consistency with the Federal Information Security Management Act (FISMA), which requires agencies to protect information and information systems commensurate with the sensitivity of the information processed, transmitted, or stored.

NFS 1852.204-76 is applicable to all NASA contracts that require contractors to: (1) have physical or electronic access to NASA's computer systems, networks, or information technology infrastructure; or (2) use information systems to generate, store, or exchange data with NASA or on behalf of NASA, regardless of whether the data resides on a NASA or a contractor's information system. NFS 1852.204-76 would be revised to:

In addition, NFS 1804.470, Security Requirements for Unclassified Information Technology (IT) Resources, would be revised to reflect the changes in NFS 1852.204-76.

Comments should be submitted on or before October 2, 2006, identified by "RIN Number 2700-AD26," by any of the following methods: (1) http://www.regulations.gov; (2) by e-mail to Ken.stepka@nasa.gov; or (3) to Ken Stepka, NASA Headquarters, Office of Procurement, Analysis Division, Washington, DC 20546.



Administrative Changes to the DFARS

The Department of Defense (DOD) issued three administrative final rules and one proposed rule that substantially revises an earlier proposed rule on export-controlled information and technology.



Proposed FAR Rules Would Address ID Verification, IPv6

Two rather technical proposed rules that would amend the FAR were recently published for comments:



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