Panoptic Enterprises' FEDERAL CONTRACTS DISPATCH
DATE: May 24, 2005
SUBJECT: Defense Federal Acquisition Regulation Supplement (DFARS); Approval of Orders Against Non-DOD contracts
SOURCE: Federal Register, May 24, 2005, Vol. 70, No. 99, page 29640
AGENCIES: Department of Defense (DOD)
ACTION: Interim Rule
SYNOPSIS: This interim rule amends the DFARS to implement Section 801(b) of the National Defense Authorization Act for Fiscal Year 2002 (Public Law 107-107), which requires DOD to establish and implement a management structure for the procurement of services, and Section 854 of the National Defense Authorization Act for Fiscal Year 2005 (Public Law 108-375), which requires DOD to comply with certain review and approval requirements before using a non-DOD contract to procure supplies or services in amounts exceeding the simplified acquisition threshold.
EDITOR’S NOTE: For more on the original interim rule that implemented Section 801(b) of Public Law 107-107, see the October 1, 2003, FEDERAL CONTRACTS DISPATCH “Defense Federal Acquisition Regulation Supplement (DFARS); Approval of Service Contracts and Task Orders.”
For more on other acquisition-related provisions of Public Law 107-107, see the January 2, 2002, FEDERAL CONTRACTS DISPATCH “Enactment of the National Defense Authorization Act for Fiscal Year 2002.”
For more on other acquisition-related provisions of Public Law 108-375, see the October 29, 2004, FEDERAL CONTRACTS DISPATCH “Enactment of the National Defense Authorization Act for Fiscal Year 2005.”
DATES: The effective date for this interim rule is May 24, 2005. Comments on the interim rule must be submitted no later than July 25, 2005.
ADDRESSES: Respondents may submit comments directly on the Federal eRulemaking Portal at http://www.regulations.gov; on the web site at http://emissary.acq.osd.mil/dar/dfars.nsf/pubcomm; by e-mail to: firstname.lastname@example.org; by fax to 703-602-0350; by mail to Defense Acquisition Regulations Council, Attn: Robin Schulze, OUSD(AT&L)DP(DAR), IMD 3C132, 3062 Defense Pentagon, Washington, DC 20301-3062; or by courier/hand to Defense Acquisition Regulations Council, Crystal Square 4, Suite 200A, 241 18th Street, Arlington, VA 22202-3402. Cite "DFARS Case 2004-D024" when making comments on this interin rule.
FOR FURTHER INFORMATION CONTACT: Robin Schulze, 703-602-0326.
SUPPLEMENTARY INFORMATION: On October 1, 2003, DOD published an interim rule that implemented Section 801(b) of Public Law 107-107, which established requirements for DOD to obtain certain approvals before acquiring services through a DOD contract or task order that is not performance based, or through any contract or task order awarded by another agency.
Seventeen sources submitted comments on the original October 1, 2003, interim rule. Following the publication of the interim rule, Public Law 108-375 was enacted, and Section 854 placed additional restrictions on the use of contracts awarded by another agency. Also, on October 29, 2004, DOD published a policy memorandum on the proper use of non-DOD contracts for the acquisition of supplies and services. Based on the comments on the original interim rule, the provisions of Section 854, and the October 29, 2004, policy memorandum, DOD is publishing a second interim rule and requesting comments.
This second interim rule makes the following changes to the DFARS:
- To DFARS 207.105, Contents of Written Acquisition Plans, paragraph (b), Plan of Action, is added the following as subparagraph (4), Acquisition Considerations: “When supplies or services will be acquired by placing an order under a non-DOD contract (e.g., a Federal Supply Schedule contract), regardless of whether the order is placed by DoD or by another agency on behalf of DOD, address the method of ensuring that the order will be consistent with DOD statutory and regulatory requirements applicable to the acquisition and the requirements for use of DoD appropriated funds.”
- In DFARS 208.404, Using Schedules, the following is added to paragraph (a): “Departments and agencies shall comply with the review and approval requirements established in accordance with [DFARS] Subpart 217.78 [Contracts or Delivery Orders Issued by a Non-DOD Agency] when placing orders for supplies or services in amounts exceeding the simplified acquisition threshold.”
- The same text as in DFARS 208.404(a) is added to DFARS 216.505, Ordering [Under Indefinite-Delivery Contracts]. (EDITOR’S NOTE: The interim rule misidentifies DFARS 216.505 as “General.” DFARS 216.501 is “General.”
- DFARS Subpart 217.78, Contracts or Delivery Orders Issued by a Non-DOD Agency, is added to implement Section 854 of Public Law 108-375. It consists of three sections:
- DFARS 217.7800, Scope of Subpart.
- DFARS 217.7801, Definitions, which included definitions for “assisted acquisition” (“a contract awarded or a task or delivery order placed on behalf of DOD by a non-DOD agency”), and “direct acquisition” (“a task or delivery order placed by a DOD official under a contract awarded by a non-DOD agency”).
- DFARS 217.7802, Policy, which requires DOD agencies to establish and maintain procedures for reviewing and approving orders placed for supplies and services under non-DOD contracts when the amount of the order exceeds the simplified acquisition threshold. These procedures are to include: “(a) evaluating whether using a non-DOD contract for the acquisition is in the best interest of DOD...; (b) determining that the tasks to be accomplished or supplies to be provided are within the scope of the contract to be used; (c) reviewing funding to ensure that it is used in accordance with appropriation limitations; (d) providing unique terms, conditions, and requirements to the assisting agency for incorporation into the order or contract as appropriate to comply with all applicable DOD-unique statutes, regulations, directives, and other requirements; and (e) collecting data on the use of assisted acquisition for analysis.”
- DFARS 237.170-2, Prohibition on Acquisition of Services, is deleted. It prohibited the acquisition of services "through use of a contract or task order that (a) is not performance based; or (b) is awarded by an agency other than DOD," unless approval was obtained. This is deleted because it is considered unnecessary and subject to misinterpretation.
- DFARS 237.170-3, Approval Requirements, is redesignated as DFARS 237.170-2, and paragraph (b), which had required approval in accordance with department or agency procedures before acquiring services through any contract or task order awarded by an agency other than DOD, is amended to require compliance with the review and approval procedures in DFARS Subpart 217.78 before acquiring services through any contract or task order awarded by a non-DOD agency.
FOR FURTHER INFORMATION CONTACT: Panoptic Enterprises at 703-451-5953.
Copyright 2005 by Panoptic Enterprises. All Rights Reserved.
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