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Panoptic Enterprises' FEDERAL CONTRACTS DISPATCH

DATE: May 31, 2002

SUBJECT: Defense Federal Acquisition Regulation Supplement (DFARS); Utilization of Indian Organizations and Indian-Owned Economic Enterprises

SOURCE: Federal Register, May 31, 2002, Vol. 67, No. 105, page 38022

AGENCIES: Department of Defense (DOD)

ACTION: Final Rule

SYNOPSIS: DOD is finalizing, without change, the September 11, 2001, interim rule that amended DFARS 226.104, Contract Clause, and added DFARS 252.226-7001, Utilization of Indian Organizations and Indian-Owned Economic Enterprises -- DOD Contracts, to provide for incentive payments to DOD contractors and subcontractors at any tier that use Indian organizations.

EDITOR'S NOTE: For more on the interim rule, see the September 11, 2001, FEDERAL CONTRACTS DISPATCH "Defense Federal Acquisition Regulation Supplement (DFARS); Utilization of Indian Organizations and Indian-Owned."

EFFECTIVE DATE: May 31, 2002.

FOR FURTHER INFORMATION CONTACT: Angelina Moy, Defense Acquisition Regulations Council, OUSD(AT&L)DP(DAR), IMD 3C132, 3062 Defense Pentagon, Washington, DC 20301-3062; 703-602-1302; fax: 703-602-0350. Cite DFARS Case 2000-D024 when referring to this final rule.

SUPPLEMENTAL INFORMATION: On September 11, 2001, DOD published an interim rule that implemented Section 8022 of the DOD Appropriations Act for Fiscal Year 2001 (Public Law 106-260), which provides funding for incentive payments to DOD contractors, and subcontractors at any tier, that use Indian organizations and Indian-owned economic enterprises as subcontractors.

The interim rule revised DFARS 226.104(a) to direct contracting officers to use new DFARS 252.226-7001 instead of FAR 52.226-1, Utilization of Indian Organizations and Indian-Owned Economic Enterprises. FAR 52.226-1 provides for the contractor to receive an additional 5% of the estimated cost, target cost, or firm-fixed price of any subcontracts awarded to Indian organizations or Indian-owned economic enterprises (the contractor must assert its claim and it has the burden of proving the amount claimed). DFARS 252.226-7001 is similar to FAR 52.226-1 in that it provides the additional 5% to contractors that subcontract to Indian organizations or Indian-owned economic enterprises, and to subcontractors at any tier that further subcontract to Indian organizations or Indian-owned economic enterprises. However, the contractor must request the 5% adjustment on behalf of the subcontractor.

Nineteen respondents submitted comments on the interim rule, but DOD decided not to adopt any of the comments, so the interim rule is adopted without change.

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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