Panoptic Enterprises'


Federal Acquisition Developments, Guidance, and Opinions

January 2011
Vol. XII, No. 1


FAC 2005-47 Revises HUBZone Program, Allows Subcontractor SDB Self-Certification
Competitiveness Demonstration Program Removed
DOD Continues Its Rampage Through the DFARS
Prompt Payment Interest Rate Set at 2 5/8%
Mileage Reimbursement Set at 51¢/Mile for Private Autos
Treasury Proposes Update to Acquisition Regulations

FAC 2005-47 Revises HUBZone Program,
Allows Subcontractor SDB Self-Certification

Federal Acquisition Circular (FAC) 2005-47 amends Federal Acquisition Regulation (FAR) Part 19, Small Business Programs, to bring the FAR into conformance with recent changes made by the Small Business Administration (SBA) to two of its programs: the Historically Underutilized Business Zone (HUBZone) program, and self-certification of qualification as a small disadvantaged business (SDB). Other rules in FAC 2005-47 address interagency agreements, pass-through charges, suspension and debarment, and notification of employee rights.

Competitiveness Demonstration Program Removed

FAC 2005-48 removes FAR Subpart 19.10, Small Business Competitiveness Demonstration Program, to comply with Section 1335 of the Small Business Jobs Act of 2010 (Public Law 111-240), which repealed the Small Business Competitiveness Demonstration Program (for more on Public Law 111-240, see the October 2010 Federal Contracts Perspective article “Parity Among Small Business Programs Mandated by Statute”). The Small Business Competitiveness Demonstration Program was deceptively titled in that it actually prohibited set-asides of contracts for certain services in five industries: construction; refuse systems and related services; architectural and engineering services; nonnuclear ship repair; and landscaping and pest control services. Congress came to the conclusion that enough had been demonstration, so it repealed the program.

In addition to the removal of FAR Subpart 19.10 from the FAR, FAC 2005-48 also makes the following changes to the FAR:

DOD Continues Its Rampage Through the DFARS

The Department of Defense (DOD) continues its year-long rampage through the Defense FAR Supplement (DFARS), issuing four final rules, one statutory waiver, and one policy memorandum. In addition, DOD is preparing for more rampaging by issuing three proposed rules.

Prompt Payment Interest Rate Set at 2 5/8%

The Treasury Department has established 2 5/8% (2.625%) as the interest rate for the computation of payments made between January 1, 2011, and June 30, 2011, under the Prompt Payment Act and the Contracts Disputes Act. This rate is also used in facilities capital cost of money calculations. The interest rate for the prior six-month period (July 1, 2010, through December 31, 2010), was 3 1/8% (3.125%). The interest rate for January 1, 2010, through June 30, 2010, was 3 1/4% (3.25%).

All prompt payment interest rates since 1980 (in six-month increments) are available at http://www.treasurydirect.gov/govt/rates/tcir/tcir_opdprmt2.htm.

FAR Subpart 32.9, Prompt Payment; FAR Subpart 33.2, Disputes and Appeals; FAR 31.205-10, Cost of Money; and Cost Accounting Standard (CAS) 9904.414, Cost of Money as an Element of the Cost of Facilities Capital, are affected by this interest rate.

Mileage Reimbursement Set at 51¢/Mile for Private Autos

The General Services Administration (GSA) is reducing the mileage reimbursement rate for use of a privately owned automobile on official travel from 55¢ per mile to 51¢ per mile, and the rate for use of a motorcycle on official travel from 52¢ per mile to 48¢ per mile. The reimbursement rate for use of a privately owned aircraft remains the same at $1.29 per mile. These revised rates are effective for travel performed on or after January 1, 2011. Travel performed before January 1, 2011, will be reimbursed at the earlier rates.

By law, the automobile reimbursement rate cannot exceed the single standard mileage rate established by the Internal Revenue Service (IRS). The IRS announced a new mileage rate for automobiles of 51¢ per mile effective January 1, 2011, so GSA took action to decrease the automobile reimbursement rate as of January 1, 2011.

GSA formerly published the privately owned vehicle mileage reimbursement rates in the Federal Travel Regulations (FTR). However, it no longer does that, but instead posts the reimbursement rates on the Internet at http://www.gsa.gov/ftr in an FTR Travel/Per Diem Bulletin (the 2011 rates are in GSA Bulletin FTR 11-03 at http://www.gsa.gov/graphics/ogp/FTRBulletin11-03508.doc).

Treasury Proposes Update to Acquisition Regulations

The Department of the Treasury is proposing to amend the Department of the Treasury Acquisition Regulation (DTAR), first published on June 14, 2002, to update, revise, or remove, as applicable, outdated text and references; add new text to maintain consistency with the FAR; incorporate Treasury-specific policy associated with current FAR requirements; reflect the Treasury's organization and delegation of authorities; and make minor editorial changes.

Comments on the proposed revision must be submitted no later than February 15, 2011, by any of the following methods: (1) the Federal eRulemaking Portal: http://www.regulations.gov; (2) e-mail: fernando.tonolete@do.treas.gov; (3) fax: 202-622-2273; or (4) mail: Department of the Treasury, Office of the Procurement Executive, Attn: Fernando Tonolete, 1500 Pennsylvania Avenue, NW., Met. Square Room 6B517, Washington, DC 20220.

Copyright 2011 by Panoptic Enterprises. All Rights Reserved.

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