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[Federal Register: June 9, 2010 (Volume 75, Number 110)]
[Proposed Rules]               
[Page 32723-32727]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr09jn10-22]                         

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DEPARTMENT OF HOMELAND SECURITY

48 CFR Parts 3015, 3016, and 3052

[Docket No. DHS-2010-0045]
RIN 1601-AA43

 
Revision of Department of Homeland Security Acquisition 
Regulation; Limitations on Subcontracting in Emergency Acquisitions 
(HSAR Case 2009-005)

AGENCY: Office of the Chief Procurement Officer, DHS.

ACTION: Proposed rule with requests for comments.

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SUMMARY: The Department of Homeland Security (DHS) is proposing to 
amend its Homeland Security Acquisition Regulation (HSAR) to implement 
a statutory requirement limiting the use of subcontractors on cost-
reimbursement type contracts entered into by the Department to 
facilitate the response to or recovery from a natural disaster or act 
of terrorism or other man-made disaster.

DATES: Comments and related material submitted electronically must be 
submitted to the Federal eRulemaking Portal http://www.regulations.gov. 
on or before August 9, 2010. Comments and related material submitted by 
mail must reach the Department of Homeland Security, Office of the 
Chief Procurement Officer, Acquisition Policy and Legislation Branch at 
the address shown below on or before August 9, 2010 to be considered in 
the formation of the final rule.

ADDRESSES: You may submit comments identified by DHS docket number DHS-
2010-0045, using any one of the following methods:
    (1) Via the internet at Federal eRulemaking Portal: http://www.regulations.gov. Follow the instructions for submitting comments 
and use docket number DHS-2010-0045.
    (2) By mail to the Department of Homeland Security, Office of the 
Chief Procurement Officer, Acquisition Policy and Legislation Branch, 
Attn: Jeremy Olson, 245 Murray Drive, Bldg. 410 (RDS), Washington, DC 
20528.

FOR FURTHER INFORMATION CONTACT: Jeremy Olson, Department of Homeland 
Security, Office of the Chief Procurement Officer, Acquisition Policy 
and Legislation Branch, (202) 447-5197.

SUPPLEMENTARY INFORMATION: 

I. Request for Comments
II. Background
III. Discussion of Proposed Rule
IV. Regulatory Requirements
    A. Executive Order 12866 (Regulatory Planning and Review)
    B. Small Entities
    C. Collection of Information

I. Request for Comments

    Interested persons are invited to participate in this rulemaking by 
submitting comments and related materials. Comments and related 
materials should be organized by HSAR Part, and indicate the specific 
section that is being commented on. All comments received will be 
posted without change to http://www.regulations.gov, including any 
personal information provided. See ADDRESSES above for information on 
how to submit comments. If you submit comments by mail, please submit 
them in an unbound format, no larger than 8\1/2\ by 11 inches, suitable 
for copying and electronic filing. You may submit comments either by 
mail or via the internet as identified in the ADDRESSES section above; 
but to avoid duplication DHS requests that you submit comments and 
materials by only one method. If you would like DHS to acknowledge 
receipt of comments submitted by mail, please enclose a self-addressed, 
stamped postcard or envelope. DHS will consider all comments and 
material received during the comment period.
    Viewing comments and documents: To view comments and read 
background documents related to this rulemaking, go to http://www.regulations.gov, which contains relevant instructions under the 
FAQs tab on the home page.

II. Background

    Section 692 of the Post-Katrina Emergency Management Reform Act of 
2006 (PKEMRA), Public Law 109-295, 120 Stat. 1394, 1409 (Oct. 4, 2006), 
establishes a limitation on subcontracting for cost-reimbursement type 
contracts above the simplified acquisition threshold entered into to 
facilitate the response to or recovery from a natural disaster or act 
of terrorism or other man-made disaster. Congress enacted this 
limitation based on findings that excessive tiering of subcontractors 
under disaster recovery cost-reimbursement type contracts leads to 
inflated overhead charges and poor prime contractor oversight over 
subcontractor work. In order to implement the statutory requirement, 
DHS proposes to amend the Homeland Security Acquisition Regulation 
(HSAR) to add implementing policy.

III. Discussion of Proposed Rule

    The proposed rule would revise 48 CFR part 3015, Contracting by 
Negotiation; part 3016, Types of Contracts; and part 3052, Solicitation 
Provisions and Contract Clauses, to limit the use of subcontractors by 
prime contractors on certain DHS acquisitions above the simplified 
acquisition threshold (as defined by section 4 of the Office of Federal 
Procurement Policy Act (41 U.S.C. 403) (currently $100,000)), unless 
DHS determines that such requirements are not feasible or practicable. 
The authority to determine whether or not the subcontracting 
requirements are not feasible or practicable rests one level above the 
contracting officer. This determination may be made on the basis of 
analysis of information provided by an offeror seeking a DHS contract 
or the contracting officer may prepare a recommended Determination & 
Finding for review and approval by the deciding official.
    Contracts to be covered by the proposed regulation are those 
awarded in response to or recovery from: (1) A major disaster or 
emergency declared by the President under Title IV or Title V of the 
Robert T. Stafford Disaster Relief and Emergency Assistance Act, as

[[Page 32724]]

amended (42 U.S.C. 5121-5207) (see http://www.fema.gov/news/disasters.fema#sev2 for a list of declarations); (2) An uncontrolled 
fire or fire complex, threatening such destruction as would constitute 
a major disaster, and for which the Federal Emergency Management Agency 
has approved a fire management assistance declaration in accordance 
with regulatory criteria at 44 CFR 204.21 (see http://www.fema.gov/news/disasters.fema#sev2 for a list of declarations); or (3) An 
incident for which the National Operations Center (NOC), through the 
National Response Coordination Center (NRCC), coordinates the 
activation of the appropriate Emergency Support Functions and the 
Secretary of Homeland Security has designated a Federal Resource 
Coordinator (FRC) to manage Federal resource support. Each of these 
three types of declarations is discussed below.

Stafford Act Major Disaster or Emergency Declaration

    The Robert T. Stafford Disaster Relief and Emergency Assistance 
Act, 42 U.S.C. 5121 through 5207 (The Stafford Act), and its 
implementing regulations at 44 CFR part 206, set forth a process for a 
Governor to request the President to declare a major disaster or 
emergency. Key points of the process are set forth below:
     If an event is beyond the combined response capabilities 
of the State and affected local governments; and
     If, based on the findings of a joint Federal-State-local 
Preliminary Damage Assessment (PDA), the damage is of sufficient 
severity and magnitude to warrant assistance under the Stafford Act. In 
a particularly fast-moving or clearly devastating disaster, there may 
be an expedited declaration, and the PDA may be deferred until after 
the declaration.
     The President may direct emergency assistance without a 
Governor's request if an incident occurs that involves a subject area 
that is exclusively or preeminently the responsibility of the United 
States. The President will consult the Governor of any affected State, 
if practicable.
     FEMA may provide accelerated Federal assistance and 
support where necessary to save lives, prevent human suffering, or 
mitigate severe damage, even in the absence of a specific request. (The 
Governor of the affected State will be consulted if practicable, but 
this consultation shall not delay or impede the provision of such rapid 
assistance.)

Fire Management Assistance Declarations

    A request for a fire management assistance declaration is made by 
the Governor of a State to FEMA while a fire is burning uncontrolled. 
FEMA develops a Regional summary and approves or denies the State's 
request based on:
     The conditions that existed at the time of the State's 
request;
     Whether or not the fire or fire complex threatens such 
destruction as would constitute a major disaster.
    There are four criteria FEMA uses to evaluate the threat posed by a 
fire or fire complex:
     Threat to lives and improved property, including threats 
to critical facilities/infrastructure, and critical watershed areas;
     Availability of State and local firefighting resources;
     High fire danger conditions, as indicated by nationally 
accepted indices such as the National Fire Danger Ratings System; and
     Potential major economic impact.
    After rendering a determination, FEMA notifies the State.

Designation of Federal Resource Coordinator in Non-Stafford Act 
Situations

    The Department of Homeland Security (DHS) sometimes takes action to 
support a Federal department or agency that has requested DHS 
assistance in handling a disaster that falls under the requesting 
department or agency's jurisdiction. Key operational units that may be 
activated include the National Response Coordination Center (NRCC), 
Regional Response Coordination Center (RRCC), and Joint Field Office 
(JFO).
    Federal departments and agencies routinely manage the response to 
incidents under their statutory or executive authority that do not 
require the assistance of other Federal agencies. When a Federal entity 
with primary responsibility and authority for handling an incident 
requires assistance, that agency may request DHS coordination of 
Federal multiagency assistance. In such cases, DHS coordinates 
assistance using the procedures and structures within the National 
Response Framework. Generally, the requesting agency funds the 
participation of other Federal departments and agencies in accordance 
with provisions of the Economy Act unless other pertinent authorities 
exist. To initiate Federal-to-Federal support, the requesting agency 
submits a request for assistance to the DHS Executive Secretary via the 
National Operations Center (NOC). Requests include a summary of the 
situation, types and amount of resources needed, financial information, 
and any other appropriate details.
    Upon approval of the request, the Secretary of Homeland Security 
issues an operations order to the NOC. The NOC, through the NRCC, 
coordinates the activation of the appropriate Emergency Support 
Functions. The Secretary of Homeland Security designates a Federal 
Resource Coordinator (FRC) to manage Federal resource support. In 
circumstances requiring extraordinary coordination, the Secretary may 
appoint a Principal Federal Official to serve as his or her 
representative in the field.
    The requesting agency designates a senior official to work in 
coordination with the FRC as part of the Unified Coordination Group to 
identify and define specific support requirements. The requesting 
agency also provides comptrollers to the NRCC, RRCC, and JFO, as 
appropriate, to oversee financial management activities. An RRCC may be 
fully or partially activated to facilitate the deployment of resources 
until a JFO is established. Facilities, such as mobilization centers, 
may be established to accommodate personnel, equipment, and supplies. 
Federal agencies provide resources under interagency reimbursable 
agreements or their own authorities.
    Although the Department considered establishment of separate 
disaster declaration standards applicable only to section 692, it was 
determined not to be feasible or practicable. Declaration of a disaster 
under such separate 692 standards would likely confuse the public in 
the circumstance where the President or other recognized officials did 
not make a declaration for the same incident under the Stafford Act or 
other pre-existing authority.
    The limitations proposed for this amendment to the HSAR are in 
addition to, and do not replace, the Federal Acquisition Regulation 
(FAR) limitations on pass-through charges at FAR 15.408(n).

IV. Regulatory Requirements

A. Executive Order 12866 (Regulatory Planning and Review)

    This proposed rule is not a significant regulatory action under 
section 3(f) of Executive Order 12866. The Office of Management and 
Budget has not reviewed it under that Order. This proposed rule is not 
a major rule under 5 U.S.C. 804.

[[Page 32725]]

B. Small Entities

    Under the Regulatory Flexibility Act (RFA) (5 U.S.C. 601-612), we 
have considered whether this proposed rule would have a significant 
economic impact on a substantial number of small entities. The term 
``small entities'' comprises small businesses, not-for-profit 
organizations that are independently owned and operated and are not 
dominant in their fields, and governmental jurisdictions with 
populations of less than 50,000. This rule does not duplicate, overlap, 
or conflict with other federal rules.
    We do not expect this proposed rule to have a significant economic 
impact on a substantial number of small entities within the meaning of 
the RFA because the rule is limited to cost reimbursement acquisitions 
in support of response to or recovery from declared disasters. During 
FY 2008, although there were 141 declared disasters, the Federal 
Procurement Data System (FPDS) indicates that only 73 cost-type 
contract actions were awarded by DHS in response to declared disasters. 
Only 31 separate contractors received these awards with 10 of these 
being small entities. We reviewed the NAICS (North American Industry 
Classification System) codes for these 10 small entities and found 
these small entities are not concentrated in any one industry and 
represent a relatively diverse cross section of the economy. For 
example, these small entities operate within NAICS code 541611 
``Administrative Management and General Management Consulting 
Services,'' NAICS code 721211 ``RV (Recreational Vehicle) Parks and 
Campgrounds,'' NAICS code 423210 ``Furniture Merchant Wholesalers,'' 
and NAICS code 221122 ``Electric Power Distribution.'' The number of 
actions and the number of impacted contractors are very small 
proportions of the contracts awarded by the federal government and of 
the number of federal contractors. It is not anticipated that the rule 
would significantly affect the total number of cost reimbursement 
acquisitions awarded to small entities.
    When considering the economic impact of rulemakings, the RFA 
requires consideration of only the direct costs of a regulation on 
small entities that are required to comply with the regulation. Because 
the requirements of the clause promulgated by this rule includes 
requirements only for prime contractors, we believe the primary direct 
cost of this rule is the proposed requirement for submittal of 
information to DHS regarding the extent of subcontracting that is 
anticipated under a prime contract. We acknowledge that the limitation 
on subcontracting imposed by Section 692 of PKEMRA could have a 
distributional effect of shifting some of the work from subcontractors 
to prime contractors. However, distributional impacts of a rule across 
the economy are not considered an ``economic impact'' for the purposes 
of the RFA. For these reasons, DHS certifies under 5 U.S.C. 605(b) that 
this proposed rule will not have a significant economic impact on a 
substantial number of small entities. DHS invites comments from small 
entities and other interested parties concerning the affected HSAR 
Parts 3015, 3016 and 3052. Such comments should be submitted separately 
and should cite 5 U.S.C. 601, et seq. (HSAR Case 2009-005). Commenters 
should note that section 692 of PKEMRA was explicit in describing what 
types of contracts are within the scope of this rule and the maximum 
amount of subcontracting that would be allowed in these circumstances 
once this rule becomes effective. Consequently, there are no 
alternatives to the requirements of this rule that accomplish the 
stated objectives of section 692 of PKEMRA.

C. Collection of Information

    The Paperwork Reduction Act (Pub. L. 104-13) applies to this 
proposed rule because the proposed rule contains information collection 
requirements. Accordingly, the Department will submit a change request 
reflecting the amended estimate for the affected burdens concerning 
this proposed rule to the Office of Management and Budget under 44 
U.S.C. 3501, et seq.
    Annual Reporting Burden:
    Public reporting burden for this collection of information is 
estimated to average 4.20 hours per response, including the time for 
reviewing instructions, searching existing data sources, gathering and 
maintaining the data needed, and completing and reviewing the 
collection of information.
    The annual reporting burden is estimated as follows:
    Respondents: 219.
    Responses per respondent: 1.67.
    Total annual responses: 365.
    Preparation hours per response: 4.2.
    Total response burden hours: 1,533.

Request for Comments Regarding Paperwork Burden

    Submit comments, including suggestions for reducing this burden, 
not later than August 9, 2010. See ADDRESSES above for information on 
how to submit comments. If you submit comments by mail, please submit 
them in an unbound format, no larger than 8\1/2\; by 11 inches, 
suitable for copying and electronic filing. You may submit comments 
either by mail or via the Internet as identified in the ADDRESSES 
section above; but to avoid duplication DHS requests that you submit 
comments and materials by only one method. If you would like DHS to 
acknowledge receipt of comments submitted by mail, please enclose a 
self-addressed, stamped postcard or envelope. DHS will consider all 
comments and material received during the comment period. We may change 
this proposed rule in view of comments submitted. Public comments are 
particularly invited on: Whether this collection of information is 
necessary for the proper performance of functions of the HSAR, and will 
have practical utility; whether our estimate of the public burden of 
this collection of information is accurate, and based on valid 
assumptions and methodology; ways to enhance the quality, utility, and 
clarity of the information to be collected; and ways in which we can 
minimize the burden of the collection of information on those who are 
to respond, through the use of appropriate technological collection 
techniques or other forms of information technology.
    Requester may obtain a copy of the justification from the 
Department of Homeland Security, Office of the Chief Procurement 
Officer, Acquisition Policy and Legislation Branch, Attn: Jeremy Olson, 
245 Murray Drive, Bldg. 410 (RDS), Washington, DC 20528. Please cite 
OMB Control Numbers 1600-0005, Offeror submissions and 1600-0003, 
Contractor submissions, HSAR Case 2009-005, Limitations on 
Subcontracting in Emergency Acquisitions, in all correspondence.

List of Subjects in 48 CFR Parts 3015, 3016, and 3052

    Government procurement.

Richard K. Gunderson,
Acting Chief Procurement Officer, Department of Homeland Security.

    Accordingly, DHS proposes to amend (HSAR) 48 CFR parts 3015, 3016 
and 3052 as follows:
    1. The authority citation for 48 CFR parts 3015, 3016 and 3052 is 
revised to read as follows:

    Authority:  5 U.S.C. 301-302, 41 U.S.C. 418b (a) and (b), 41 
U.S.C. 414, 48 CFR part 1, subpart 1.3, and DHS Delegation Number 
0700.

PART 3015--CONTRACTING BY NEGOTIATION

    2. Add subpart 3015.4 consisting of section 3015.404-3 to read as 
follows:

[[Page 32726]]

Subpart 3015.4--Contract Pricing

3015.404-3  Subcontracting pricing considerations.

    (d) For proposal submissions subject to limitations on 
subcontracting in accordance with (HSAR) 48 CFR 3016.370, Limitations 
on subcontracting in emergency acquisitions, the contracting officer 
shall require offerors to submit sufficient evidence to permit a 
determination that the offeror will or will not award subcontracts that 
exceed 65 percent of the cost (excluding indirect costs and fee) of the 
contract or the cost of any individual task or delivery order in 
accordance with (HSAR) 48 CFR 3016.370 and 3052.216-75.

PART 3016--TYPES OF CONTRACTS

    3. Add subpart 3016.3 consisting of sections 3016.307 and 3016.370 
to read as follows:

Subpart 3016.3--Cost-Reimbursement Contracts

3016.307  Contract clauses and solicitation provisions.

    (a) The contracting officer shall insert the clause at (HSAR) 48 
CFR 3052.216-75, Limitations on Subcontracting in Emergency 
Acquisitions, in solicitations, contracts, task orders, and delivery 
orders that are cost reimbursement and exceed the simplified 
acquisition threshold if the action is entered into to facilitate 
response to or recovery from:
    (1) A major disaster or emergency declared by the President under 
Title IV or Title V of the Robert T. Stafford Disaster Relief and 
Emergency Assistance Act, as amended (42 U.S.C. 5121-5207) (see http://www.fema.gov/news/disasters.fema#sev2 for a list of declarations);
    (2) An uncontrolled fire or fire complex, threatening such 
destruction as would constitute a major disaster, and for which the 
Federal Emergency Management Agency has approved a fire management 
assistance declaration in accordance with regulatory criteria at 44 CFR 
204.21 (see http://www.fema.gov/news/disasters.fema#sev2 for a list of 
declarations); or
    (3) An incident for which the National Operations Center (NOC), 
through the National Response Coordination Center (NRCC), coordinates 
the activation of the appropriate Emergency Support Functions and the 
Secretary of Homeland Security has designated a Federal Resource 
Coordinator (FRC) to manage Federal resource support.
    (b) The contracting officer shall insert the provision at (HSAR) 48 
CFR 3052.216-76, Proposal Information on Limitations on Subcontracting 
in Emergency Acquisitions, in solicitations for cost reimbursement 
contracts, task orders, and delivery orders expected to exceed the 
simplified acquisition threshold if the action will be entered into to 
facilitate response to or recovery from:
    (1) A major disaster or emergency declared by the President under 
Title IV or Title V of the Robert T. Stafford Disaster Relief and 
Emergency Assistance Act, as amended (42 U.S.C. 5121-5207) (see http://www.fema.gov/news/disasters.fema#sev2 for a list of declarations);
    (2) An uncontrolled fire or fire complex, threatening such 
destruction as would constitute a major disaster, and for which the 
Federal Emergency Management Agency has approved a fire management 
assistance declaration in accordance with regulatory criteria at 44 CFR 
204.21 (see http://www.fema.gov/news/disasters.fema#sev2 for a list of 
declarations); or
    (3) An incident for which the National Operations Center (NOC), 
through the National Response Coordination Center (NRCC), coordinates 
the activation of the appropriate Emergency Support Functions and the 
Secretary of Homeland Security has designated a Federal Resource 
Coordinator (FRC) to manage Federal resource support.

3016.370  Limitations on subcontracting in emergency acquisitions.

    (a) A prime contractor under a cost reimbursement contract or a 
task or delivery order shall not subcontract more than 65 percent of 
the cost (exclusive of indirect costs and fee) of the action except as 
provided in paragraph (b) of this subsection, if the dollar value of 
the action is above the simplified acquisition threshold and if the 
action is entered into to facilitate response to or recovery from:
    (1) A major disaster or emergency declared by the President under 
Title IV or Title V of the Robert T. Stafford Disaster Relief and 
Emergency Assistance Act, as amended (42 U.S.C. 5121-5207) (see http://www.fema.gov/news/disasters.fema#sev2 for a list of declarations);
    (2) An uncontrolled fire or fire complex, threatening such 
destruction as would constitute a major disaster, and for which the 
Federal Emergency Management Agency has approved a fire management 
assistance declaration in accordance with regulatory criteria at 44 CFR 
204.21 (see http://www.fema.gov/news/disasters.fema#sev2 for a list of 
declarations); or
    (3) An incident for which the National Operations Center (NOC), 
through the National Response Coordination Center (NRCC), coordinates 
the activation of the appropriate Emergency Support Functions and the 
Secretary of Homeland Security has designated a Federal Resource 
Coordinator (FRC) to manage Federal resource support.
    (b) The prohibition on subcontracting in paragraph (a) of this 
subsection does not apply if a determination is made that it is not 
feasible or practicable to apply it to a contract action or class of 
contract actions. The contracting officer shall prepare this 
determination and findings (D&F) using the format found in 48 CFR 
3001.704. Review and approval of the D&F shall be one-level above the 
contracting officer unless a higher authority is established by the 
HCA.
    (c) For purposes of establishing the percent of cost of work of the 
contract or task or deliver order, see 48 CFR 3052.216-75.

PART 3052--SOLICITATION PROVISIONS AND CONTRACT CLAUSES

    4. Add sections 3052.216-75 and 3052.216-76 to subpart 3052.2 to 
read as follows:

3052.216-75  Limitations on subcontracting in emergency acquisitions.

    As prescribed in (HSAR) 48 CFR 3016.307(a) insert the following 
clause in solicitations, orders and contracts:

LIMITATIONS ON SUBCONTRACTING IN EMERGENCY ACQUISITIONS

(TBD 2010)

    Section 692 of the Department of Homeland Security 
Appropriations Act, Fiscal Year 2007, limits the use of 
subcontractors by prime contractors on certain cost reimbursement 
acquisitions entered into with the Department of Homeland Security 
and its Components.
    (a) This acquisition is a cost reimbursement action subject to 
the limitations of section 692 for a requirement to facilitate the 
response to or recovery from:
    (1) A major disaster or emergency declared by the President 
under Title IV or Title V of the Robert T. Stafford Disaster Relief 
and Emergency Assistance Act, as amended (42 U.S.C. 5121-5207) (see 
http://www.fema.gov/news/disasters.fema#sev2 for a list of 
declarations);
    (2) An uncontrolled fire or fire complex, threatening such 
destruction as would constitute a major disaster, and for which the 
Federal Emergency Management Agency has approved a fire management 
assistance declaration in accordance with regulatory criteria at 44 
CFR 204.21 (see http://www.fema.gov/news/disasters.fema#sev2 for a 
list of declarations); or
    (3) An incident for which the National Operations Center (NOC), 
through the

[[Page 32727]]

National Response Coordination Center (NRCC), coordinates the 
activation of the appropriate Emergency Support Functions and the 
Secretary of Homeland Security has designated a Federal Resource 
Coordinator (FRC) to manage Federal resource support.
    (b) The Contractor agrees that in performance of the contract, 
no more than 65 percent of the contract cost, excluding indirect 
costs incurred by the Contractor and fee paid to the Contractor, 
will be subcontracted. If this clause is included only in an 
individual task or delivery order or is made applicable only to 
certain task or delivery orders, this limit applies only to such 
task or delivery order(s) and not to the entire contract.
    (c) For purposes of this clause, the percentage of cost shall be 
calculated by determining all costs exclusive of indirect costs and 
fee being incurred by the Contractor, and comparing this value to 
the total dollars the Contractor allocates to subcontractors.
    (d) The Contractor shall notify the Contracting Officer in 
writing annually, on the anniversary date of contract award, the 
total cost (less indirect costs and fee) it has incurred for the 
previous 12-month period and the total subcontracted cost during the 
same period. If the percentage of costs incurred by its 
subcontractors exceeds 65 percent, the Contractor's notification 
shall include a description of the reason(s) the percentage of 
subcontracted cost exceeded 65 percent and a plan for becoming 
compliant with the requirements of this clause.
    (e) If the Contractor expects at any time that compliance with 
these limits is not practicable or feasible, it shall submit a 
written request for waiver to the Contracting Officer with 
supporting rationale.
    (f) The requirements of this clause remain in effect unless the 
Contracting Officer provides notification to the Contractor that 
compliance with these limits has been excused in accordance with 
(HSAR) 48 CFR 3016.370(b), or until the Contracting Officer provides 
notification that the requirements of this clause are no longer in 
force.
    (g) In addition to any other remedy available to the government, 
the Contractor's ability to remain complaint with the terms of this 
clause may be included in past performance evaluations performed by 
Government personnel and considered by the Government when making 
future award decisions and failure to comply with its terms may 
result in disallowance of certain incurred costs.
    (h) Nothing in this clause shall be construed as superseding or 
nullifying other terms or conditions of the contract including those 
associated with socioeconomic goals and consent to subcontract 
requirements.
    (End of Clause)

3052.216-76  Proposal information on limitations on subcontracting in 
emergency acquisitions.

    As prescribed in (HSAR) 48 CFR 3016.307(b) insert the following 
provision in solicitations:

PROPOSAL INFORMATION ON LIMITATIONS ON SUBCONTRACTING IN EMERGENCY 
ACQUISITIONS

(TBD 2010)

    (a) The contract or order that is expected to be awarded based 
on this solicitation will include the clause at (HSAR) 48 CFR 
3052.216-75, in which the Contractor agrees that in performance of 
that contract or order, no more than 65 percent of the cost, 
excluding indirect costs and fee, will be subcontracted.
    (b) The proposal shall include acceptable evidence of the 
offeror's ability to satisfy this requirement. For purposes of this 
evidence, the percentage of cost shall be calculated by determining 
all costs, exclusive of indirect costs and fee, being proposed by 
the offeror and comparing this value to the total cost the offeror 
plans to subcontract. Upon contract award and during contract 
performance, this percentage of costs shall be calculated similarly 
based on costs incurred by the Contractor and amounts awarded to its 
subcontractors.
    (c) If the offeror expects that compliance with these limits is 
not practicable or feasible, it shall include a written request for 
waiver in its offer along with supporting rationale. Offerors are 
hereby notified that an offer conditioned on acceptance of the 
waiver may not be considered for award, at the discretion of the 
Contracting Officer.
    (End of Provision)
[FR Doc. 2010-13801 Filed 6-8-10; 8:45 am]
BILLING CODE 4910-9B-P
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