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Panoptic Enterprises' FEDERAL CONTRACTS DISPATCH

DATE: January 2, 2002

SUBJECT: Enactment of the National Defense Authorization Act for Fiscal Year 2002

AGENCIES: Department of Defense (DOD)

ACTION: Editor's Analysis

SYNOPSIS: On December 28, 2001, President Bush signed Public Law 107-107, the National Defense Authorization Act for Fiscal Year 2002, which contains several acquisition-related provisions, some of which apply governmentwide.

ANALYSIS: The following are some of the key acquisition-related provisions of the $318 billion Fiscal Year 2002 Defense Authorization Act (all of which are in Title VIII, Acquisition Policy, Acquisition Management, and Related Matters):

In addition to Title VIII of Public Law 107-107, an acquisition-related provision is included in Section 345, Pilot Manpower Reporting System in Department of the Army. This requires the Army to "submit to Congress a report describing the use during the previous fiscal year of non-federal entities to provide services to the Department of the Army." This report is to be submitted no later than March 1 of FY 2002, 2003, and 2004, and is to "specify the number of work year equivalents performed by individuals employed by non-federal entities in providing services to the Department..." However, the information obtained from non-federal entities must be "available to the contractor from existing data collection systems." In other words, contractors will not be forced to collect any additional data or develop new data systems.

Section 343 of Public Law 106-65, the FY 2000 Department of Defense Authorization Act, required the Secretary of Defense to report to Congress by March 1, 2001, "the use during the previous fiscal year of non-federal entities to provide services to the Department of Defense." To implement Section 343, on March 15, 2000, the Army established Title 32 of the Code of Federal Regulations (CFR), Part 668, Contractor Manhour Reporting Requirement, which required Army contractors to identify the number and value of direct, and associated indirect, labor work year equivalents for contracted services in support of the Army.

On December 26, 2000, the Army completely reorganized and revised 32 CFR Part 668, but the Army did not ask for public comments on the reorganized Part 668. Because of a number of legal and technical/procedural issues raised and significant complaints from industry about the scope and methodology of the Army rule, Director of Defense Procurement Deidre Lee issued memorandums dated May 5, 2001, and June 5, 2001, directing the Army to cease collecting the data. Therefore, on July 12, 2001, the Army removed 32 CFR Part 668. Now, the Army will be reinstating 32 CFR Part 668 in accordance with Section 345 of Public Law 107-107 (but probably being a little more careful about procedural niceties).

For more on the Army reporting requirement in response to Section 343 of Public Law 106-65, see the following FEDERAL CONTRACTS DISPATCHES:

July 13, 2001, Army; Report On Use of Employees of Non-Federal Entities To Provide Services

June 27, 2001, Army; Report On Use of Contractor Employees to Provide Services

December 26, 2000, Army; Report On Use of Contractor Employees to Provide Services

March 15, 2000, Army; Report On Use of Contractor Employees to Provide Services

FOR FURTHER INFORMATION CONTACT: Panoptic Enterprises at 703-451-5953 or by e-mail to Panoptic@FedGovContracts.com.

Copyright 2002 by Panoptic Enterprises. All Rights Reserved.

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