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[Federal Register Volume 78, Number 145 (Monday, July 29, 2013)]
[Proposed Rules]
[Pages 45490-45493]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2013-18167]

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DEPARTMENT OF STATE

48 CFR Parts 645 and 652

[Public Notice 8395]
RIN 1400-AC33

Department of State Acquisition Regulation

AGENCY: State Department.

ACTION: Proposed rule.

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SUMMARY: This proposed rule will update the Department of State 
Acquisition Regulation (DOSAR) to conform to recent Federal Acquisition 
Regulation (FAR) changes and adds a new DOSAR clause and provision 
regarding reporting certain categories of Government-furnished and 
contractor-acquired property.

DATES: The Department will accept comments from the public up to 
September 27, 2013.

ADDRESSES: You may submit comments by any of the following methods:
     Email: RamirezIM2@state.gov. You must include the RIN in 
the subject line of your message.
     Mail (paper, disk, or CD-ROM submissions): Ella Ramirez, 
Senior Procurement Analyst, Policy Division, Department of State, 
Office of the Procurement Executive, 2201 C Street NW., Suite 900, 
State Annex Number 27, Washington, DC 20522-0602.
     Fax: 703-875-6155.
     Persons with access to the Internet may also view this 
notice and provide comments by going to the regulations.gov Web site at 
http://www.regulations.gov/index.cfm and searching on docket DOS-2013-
8395.

FOR FURTHER INFORMATION CONTACT: Ella Ramirez, Senior Procurement 
Analyst, Policy Division, Department of State, Office of the 
Procurement Executive, 2201 C Street NW., Suite 900, State Annex Number 
27, Washington, DC 20522-0602; email address: RamirezIM2@state.gov.

SUPPLEMENTARY INFORMATION:

Background

    This proposed rule provides updates to the DOSAR Government 
Property coverage to correspond with current FAR requirements and to 
implement Department of State policies regarding Government Property. 
The proposed rule would make the following changes:
     Update DOSAR Part 645, Government Property to conform to 
the current version of FAR Part 45. FAR Part 45 was completely revised 
and re-structured in 2007. Part 45 has been updated since, most 
recently in April 2012. DOSAR Part 645 was last updated in 1999, and is 
therefore out of date.
     Add a new DOSAR provision and clause regarding management 
and reporting of Government-furnished and contractor-acquired property. 
The provision at DOSAR 652.245-70, Status of Property Management 
System, was inadvertently left out of the previously approved 
information collection and it is now being added to update the DOSAR 
rule. The provision requests information from offerors regarding their 
property management systems in order to comply with FAR 45.201(c), 
which says that the solicitation shall require all offerors to submit a 
description of the offeror's property management system, plan, and any 
customary commercial practices, voluntary consensus standards, or 
industry-leading practices and standards to be used by the offeror in 
managing Government property. Additionally, the Department must be able 
to determine if there will be a need for a review of the prospective 
contractor's property control system. The new clause at DOSAR 652.245-
71, Accounting for Government Property, requests quarterly reporting of 
U.S. Department of State capitalized property which consists of the 
following:
    [cir] Highway motor vehicles and aircraft, regardless of cost, that 
are provided by the Government or acquired by a contractor for the 
Government;
    [cir] Software exceeding $500,000 in value, including labor costs 
to develop, that is provided by the Government or acquired by a 
contractor for the account of the Government; and
    [cir] Personal property greater than $25,000 (and not included in 
the above list) that is provided by the Government or acquired by the 
contractor for the account of the Government. The personal property 
must be complete within itself; must not lose its identity or become a 
component part of other property when put into use; and is of a durable 
nature with an estimated useful life expectancy to exceed two years.
    This clause is being added due to the need to obtain current data 
to support the Department of State (DOS) financial statements. From a 
financial accounting perspective, DOS must have a way of keeping track 
of its capital assets; therefore, this clause requires reporting of all 
personal property that meets the criteria for capitalization, as set 
forth in the Foreign Affairs Manual (FAM) at 4 FAM 734.2.

Regulatory Findings

Administrative Procedure Act

    In accordance with provisions of the Administrative Procedure Act, 
the Department is publishing this proposed rule and inviting public 
comment.

Regulatory Flexibility Act

    The Department of State, in accordance with the Regulatory 
Flexibility Act (5 U.S.C. 605(b)), has reviewed this regulation and, by 
approving it, certifies that this rule will not have a significant 
economic impact on a substantial number of small entities. This 
determination was based on the fact that the reporting requirements are 
targeted at a very narrow segment of government property and based on a 
determination that there are only 14 contractors who are currently 
subject to the reporting requirements of the clause. Only four of these 
are small business concerns. Thus, it was concluded that the rule will 
not have a significant economic impact on a substantial number of small 
entities.

Unfunded Mandates Act of 1995

    This rule will not result in the expenditure by State, local, and 
tribal governments, in the aggregate, or by the private sector, of $100 
million or more in any year and it will not significantly or uniquely 
affect small governments. Therefore, no actions were deemed necessary 
under the provisions of the Unfunded Mandates Act of 1995.
    Small Business Regulatory Enforcement Fairness Act of 1996
    This rule is not a major rule as defined by the Small Business 
Regulatory Enforcement Act of 1996 (5 U.S.C. 801 et seq.). This rule 
will not result in an annual effect on the economy of $100 million or 
more; a major increase in costs or prices; or significant adverse 
effects on competition, employment, investment, productivity, 
innovation, or on the ability of United States-based

[[Page 45491]]

companies to compete with foreign-based companies in domestic and 
import markets. This determination was based on the fact that the 
reporting requirements are targeted at a very narrow segment of 
government property, and on a determination that there are only 14 
contractors who are currently subject to the reporting requirements of 
the clause. The rule does not place new requirements on contract 
performance, but merely addresses reporting of existing information.

Executive Orders 12866 and 13563

    Executive Orders (E.O.) 12866 and 13563 direct agencies to assess 
costs and benefits of available regulatory alternatives and, if 
regulation is necessary, to select regulatory approaches that maximize 
net benefits (including potential economic, environmental, public 
health and safety effects, distributive impacts and equity). E.O. 13563 
emphasized the importance of quantifying both costs and benefits, of 
reducing costs, of harmonizing rules, and of promoting flexibility. The 
Department of State does not consider this rule to be a ``significant 
regulatory action'' under Executive Order 12866, section 3(f), 
Regulatory Planning and Review.
    In addition, the Department is exempt from Executive Order 12866 
except to the extent that it is promulgating regulations in conjunction 
with a domestic agency that are significant regulatory actions. The 
Department has nevertheless reviewed the regulation to ensure its 
consistency with the regulatory philosophy and principles set forth in 
the Executive Orders and finds that the benefits of the proposed rule 
outweigh any costs.

Executive Order 13132

    This rule will not have substantial direct effects on the States, 
on the relationship between the national government and the States, or 
on the distribution of power and responsibilities among the various 
levels of government. Therefore, in accordance with section 6 of 
Executive Order 13132, it is determined that this rule does not have 
sufficient federalism implications to require consultations or warrant 
the preparation of a federalism summary impact statement.

Executive Order 13175

    The Department has determined that this rulemaking will not have 
tribal implications, will not impose substantial direct compliance 
costs on Indian tribal governments, and will not pre-empt tribal law. 
Accordingly, the requirements of Executive Order 13175 do not apply to 
this rulemaking.

Paperwork Reduction Act

    The Paperwork Reduction Act of 1980 (44 U.S.C. Chapter 35) applies, 
because the proposed rule imposes information collection requirements 
that require the approval of the Office of Management and Budget under 
44 U.S.C. 3501 et seq.
    The Department of State is seeking OMB approval for the information 
collection described below.
     Title of Information Collection: Department of State 
Acquisition Regulation (DOSAR) 652.245-70, Status of Property 
Management System
     OMB Control Number: 1405-0050
     Type of Request: Revision of Currently Approved Collection
     Originating Office: Bureau of Administration, Office of 
Procurement Executive, Policy Division (A/OPE/PD)
     Form Number: None
     Respondents: Business and other for-profit and not-for-
profit organizations wishing to receive Department of State contracts.
     Estimated Total Number of Respondents: 3,466
     Estimated Total Number of Responses: 9,330
     Average Time Per Response: 30 hours
     Total Estimated Burden Time: 275,984
     Frequency: On Occasion
     Obligation to Respond: Required to Obtain or Retain a 
Benefit
    The total number of responses was increased by fourteen from 9,316 
to 9,330. As a result of this change, the total estimated burden was 
increased from 275,970 hours to 275,984 hours. The increase in the 
responses and the burden is due to the impact of this DOSAR provision.
    The Department will accept comments from the public up to September 
27, 2013.

ADDRESSES: You may submit comments by any of the following methods:
     Web: www.Regulations.gov, search for this notice by using 
this rule's docket number--DOS-2013-8395.
     E-Mail: RamirezIM2@state.gov with the subject line, 
``DOSAR Rule Comments.''
     Fax: 703-875-6155
    Direct requests for additional information regarding the collection 
listed in this notice, including requests for copies of the proposed 
collection instrument and supporting documents, to Ella Ramirez, Senior 
Procurement Analyst, who may be reached at (703) 516-1693, or at 
RamirezIM2@state.gov.
    Abstract of proposed collection:
    The proposed rule will update the Department of State Acquisition 
Regulation (DOSAR) to conform to recent Federal Acquisition Regulation 
(FAR) changes, and adds a new DOSAR provision, 652.245-70, regarding 
reporting on the status of offeror's property management systems. 
Respondents are offerors on solicitations for contracts under which 
specified government property will be provided. This is an existing IC, 
1405-0050, Department of State Acquisition Regulation (DOSAR) 652.245-
70, Status of Property Management System. This provision was 
inadvertently left out of the previously approved Information 
Collection package. The new provision is being inserted into the DOSAR 
and concurrently added into the current IC. The new DOSAR provision 
(and IC requirement) asks for procedures for government property 
management (transportation, software, personal property). Over the 
course of the last two fiscal years (FY 11 and FY 12), only four 
solicitations were issued under which this new reporting was required, 
and on those solicitations, an average of 2.3 submissions was received. 
Based on conversations with a sample of submitters, we estimate that 
approximately 1.0 hour is required to research, document and 
incorporate the information into the proposal.
    We are soliciting public comments to permit the Department to:
     Evaluate whether the proposed information collection is 
necessary for the proper functions of the Department.
     Evaluate the accuracy of our estimate of the time and cost 
burden for this proposed collection, including the validity of the 
methodology and assumptions used.
     Enhance the quality, utility, and clarity of the 
information to be collected.
     Minimize the reporting burden on those who are to respond, 
including the use of automated collection techniques or other forms of 
information technology.
    Please note that comments submitted in response to this Notice are 
public record. Before including any detailed personal information, you 
should be aware that your comments as submitted, including your 
personal information, will be available for public review.
    Legal Authorities are as follows:

(1) Code of Federal Regulations, title 48, chapter 6, Department of 
State Acquisition Regulation
(2) Code of Federal Regulations, title 48, chapter 1, Federal 
Acquisition Regulation
(3) Public Law 103-236, Foreign Relations Authorization Act, Fiscal 
Years 1994 and 1995

[[Page 45492]]

(4) Foreign Service Buildings Act of 1926, as amended (22 U.S.C. 302)
(5) Omnibus Diplomatic Security and Antiterrorism Act of 1986 (22 
U.S.C. 4852)
(6) Foreign Relations Authorization Act, Fiscal Years 1990 and 1991 (22 
U.S.C. 4864)
    Methodology:
    The information collections may be sent to the Office of Finance 
via email at RM-FPRAPROP@state.gov.

List of Subjects in 48 CFR Parts 645 and 652

    Government procurement, Electronic commerce, Contracts.
    Accordingly, for reasons set forth in the preamble, title 48, 
chapter 6 of the Code of Federal Regulations is proposed to be amended 
as follows:

0
1. Revise part 645 to read as follows:

PART 645--GOVERNMENT PROPERTY

Subpart 645.1--General
Sec.
645.107 Contract clauses.
645.107-70 DOSAR contract clause and solicitation provision.

    Authority: 40 U.S.C. 121; 22 U.S.C. 2651a; 48 CFR Subpart 1.3.

645.107 Contract clauses.
645.107-70 DOSAR contract clause and solicitation provision.

    (a) The contracting officer shall insert the provision at 652.245-
70, Status of Property Management System, in solicitations when any of 
the following conditions apply:
    (1) Highway motor vehicles and aircraft, regardless of cost, are 
provided by the Government or acquired by the contractor for the 
account of the Government;
    (2) Software exceeding $500,000 in value, including labor costs to 
develop, is provided by the Government or acquired by the contractor 
for the account of the Government; or
    (3) Personal property greater than $25,000 (and not in paragraphs 
(a)(1) or (2) of this section) is provided by the Government or 
acquired by the contractor for the account of the Government. The 
personal property must be complete within itself; does not lose its 
identity or become a component part of other property when put into 
use; and is of a durable nature with an estimated useful life 
expectancy to exceed two years.
    (b) The contracting officer shall insert the clause at 652.245-71, 
Accounting for Government Property, in all solicitations and contracts 
than contain the provision at 652.245-70.

PART 652--SOLICITATION PROVISIONS AND CONTRACT CLAUSES

0
2. The authority citation for part 652 continues to read as follows:

    Authority:  40 U.S.C. 486(c); 22 U.S.C. 2658.
0
3. Add section 652.245-70 to read as follows:

652.245-70  Status of Property Management System.

    As prescribed in 645.107-70(a), insert the following provision:

Status of Property Management System (DATE)

    (a) When used in this provision, government-furnished property, 
government property, and contractor-acquired property are as defined 
in FAR 45.101.
    (b) Offerors shall include in their quote or offer:
    (1) Whether the offeror's property management system that will 
be used on this contract to track government-furnished property and/
or contractor-acquired property has been determined to be adequate 
by a Federal property manager;
    (2) The name, address, telephone number and email address of 
both the--
    (i) Cognizant Administrative Contracting Officer (ACO) 
responsible for review and determination of adequacy of the 
contractor's property system; and
    (ii) The cognizant contractor government property manager;
    (3) The voluntary consensus standard or industry leading 
practices and standards to be used in the management of government 
property, or existing property management plans, methods, practices 
or procedures for accounting of property.

(End of provision)
0
4. Add section 652.245-71 to read as follows:

652.245-71  Accounting for Government Property.

    As prescribed in 645.107-70(b), insert the following clause:

Accounting for Government Property (DATE)

    (a) Definitions. As used in this clause:
    Disposition means government property that has been removed from 
use on the contract.
    Highway motor vehicle means any vehicle, self propelled or drawn 
by mechanical power, designed and operated principally for highway 
transportation of property or passengers. (41 CFR 102-34.35)
    (b) The Contractor shall establish and maintain a property 
management system that is in accordance with the clause at FAR 
52.245-1, Government Property. This clause supplements these 
requirements by specifying the U.S. Department of State capitalized 
property reporting requirements.
    (c) The Contractor shall submit electronically one report on an 
annual basis and three other reports on a quarterly basis for the 
following:
    (1) Where highway motor vehicles and aircraft, regardless of 
cost, are provided by the Government or acquired by the Contractor 
for the account of the Government;
    (2) Where software exceeding $500,000 in value, including labor 
cost to develop, is provided by the Government or acquired by the 
Contractor for the account of the Government; or
    (3) Where personal property greater than $25,000 (not in 
paragraph (c)(1) or (c)(2) of this clause) is provided by the 
Government or acquired by the Contractor for the account of the 
Government. The personal property must be complete within itself; 
does not lose its identity or become a component part of other 
property when put into use; and is of a durable nature with an 
estimated useful life expectancy to exceed two years.
    (d) The Contractor shall submit all annual and quarterly reports 
in the following format, except as stated in paragraph (e) of this 
clause:
    (1) Property shall be grouped by the following property 
classifications:
    (i) Highway motor vehicles;
    (ii) Communications equipment;
    (iii) Information technology (formerly called automated data 
processing) equipment;
    (iv) Reproduction equipment;
    (v) Security equipment;
    (vi) Software;
    (vii) Software-in-development;
    (viii) Medical equipment;
    (ix) Aircraft property; and
    (x) Other depreciable personal property.
    (2) Data elements for each unit of property shall include:
    (i) Contract number: Federal Government contract or purchase 
order number;
    (ii) Task Order number;
    (iii) Property classification: From classification listed in 
paragraph (d)(1) of this clause;
    (iv) Denotation as either government-furnished property (GFP) or 
contractor-acquired property (CAP);
    (v) Noun name of property (i.e. generator);
    (vi) Description of property;
    (vii) Manufacturer;
    (viii) Model;
    (ix) Serial number;
    (x) National Stock Number if applicable
    (xi) Unique-item identifier or equivalent: such as barcode label 
(tag number) or system-assigned number. For highway motor vehicles, 
this must be the vehicle identification number (VIN);
    (xii) Date received: Date contractor took possession;
    (xiii) Date placed in service;
    (xiv) Acquisition method:
    (A) Contractor Acquired Property (CAP); or
    (B) Government-furnished property (GFP); (If from another DOS 
contract, or government agency, please specify).
    (xv) Acquisition cost (As defined in FAR clause 52.245-1(a)): 
Use estimated fair-market value for property transferred or donated, 
at the time acquired, if actual cost is unknown;
    (xvi) Estimated useful life in years: The period during which 
the property is expected

[[Page 45493]]

to provide the service for which it was intended. This should 
normally be equivalent to the depreciation schedule;
    (xvii) Current location of the property: Country and city
    (xviii) Disposal Date
    (xix) Disposal Method
    (e) The Contractor shall submit a full property report, as 
described in this clause, including affirmation, for the report 
covering the first quarter of the base contract. Thereafter, 
submission of reports shall follow the time frames outlined in 
paragraph (h) of this clause. Quarterly property reports, other than 
the annual report, may be either full property reports or only 
updates to the full property report. Quarterly reports do not 
require affirmations even when the Contractor chooses to submit a 
full property report. Affirmations are only required for the report 
covering the first quarter of the contract and the annual report for 
each subsequent option year of the contract. If the Contractor 
submits a full property report, dispositions subsequent to any 
previous report must also be identified in the report. If a 
Contractor submits a quarterly report in the form of an update, the 
update shall include acquisitions and dispositions.
    (f) The Contractor shall provide any required affirmation in the 
following format. The affirmation shall be signed by the 
Contractor's managerial personnel (as defined in FAR clause 52.245-
1):
    ``I hereby affirm that a physical inventory of the government 
property (as defined in Federal Acquisition Regulation (FAR) 45.101) 
of Department of State contract number (insert contract number) has 
been completed as of (insert date), the inventory has been 
reconciled to our records and the property information in our 
report, and that to the best of my knowledge and belief, this 
inventory is accurate, current, and complete.
Signed:
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    (g) In addition to the information required above, the 
Contractor shall include in all property reports:
    (1) The current degree to which properly qualified Government 
personnel have evaluated the Contractor's property management system 
as being an adequate property management system;
    (2) The name, mailing address, telephone number, and email 
address of the qualified Government person(s) who performed the 
evaluation of the Contractor's property management system; and
    (3) The cognizant contractor government property manager.
    (h) Reports shall cover the following time periods and are due 
on the following dates:

------------------------------------------------------------------------
            Report                  Period covered          Due date
------------------------------------------------------------------------
1st Quarter Report............  For 1st quarter ending  January 15.
                                 December 31.
2nd Quarter Report............  For 2nd quarter ending  April 30.
(Annual Property Report)......   March 31.
3rd Quarter Report............  For 3rd quarter ending  July 15.
                                 June 30.
4th Quarter Report............  For 4th quarter ending  October 8.
                                 September 30.
------------------------------------------------------------------------

    (i) The Contractor shall send a copy of all reports to the 
individuals listed below. The Contractor shall submit reports in 
electronic format as an attachment to an email. The affirmation 
described in paragraph (f) of this clause shall be in Adobe Acrobat 
(.pdf) format (including the signature), while the inventories, both 
quarterly and annual, shall be in Microsoft Excel format (Adobe 
Acrobat and Microsoft Excel versions shall be compatible with 
versions used by DOS). Send all reports to:
    (1) The contracting officer;
    (2) The Property Administrator;
    (3) The contracting officer's representative (COR);
    (4) Propertyreports@state.gov;
    (5) RM-FPRA-PROP@state.gov; and
    (6) All individuals listed below (if any):
    (i) Contracting officer shall list individuals, if any.
    (ii) [Reserved]
    (j) The Contractor shall cooperate by responding timely to all 
follow up questions and requests for supporting documentation 
whether requested by the Department or external auditors.

    (End of clause)

     Dated: June 12, 2013.
Corey M. Rindner,
Procurement Executive, Department of State.

[FR Doc. 2013-18167 Filed 7-26-13; 8:45 am]
BILLING CODE 4710-24-P
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