Federal Register / Vol. 62, No. 173 / Monday, September 8, 1997 / Proposed Rules 47179

goods or services.’’ Similarly, the

Internal Revenue Service does not deem

nonprofit organizations that provide

backend premiums to be involved in

sales transactions.

The Postal Service believes it is

reasonable to provide similar treatment

to backend premiums, particularly

where the receipt of the premiums does

not appear to be the principal

motivation of the donors or members. In

these instances, the offer of the

premiums will not be considered as

‘‘advertisements’’ for postal purposes;

thus the announcements are exempt

from the substantially related rules

affecting advertisements in nonprofit

mail. The Postal Service proposes two

tests. First, the requested contribution or

other payment must be at least five (5)

times the total cost of the premiums to

exempt the announcements from being

considered as advertisements for the

premiums. The cost of each premium is

its actual cost to the nonprofit

organization. Second, the requested

contribution or other payment must be

at least three (3) times the represented

values in the mailpiece, if any, of the

premiums. Both tests must be met or the

offer will be considered an

advertisement. Nonprofit organizations

wishing to mail solicitations for

contributions which offer a premium

may be asked to substantiate the cost to

the nonprofit organization for the

premium, consistent with their usual

obligation to demonstrate eligibility for

nonprofit rates.

Although exempt from the notice and

comment requirements of the

Administrative Procedure Act (5 U.S.C.

553(b), (c)) regarding proposed

rulemaking by 39 U.S.C. 410(a), the

Postal Service invites comments on the

following proposed revisions of the

Domestic Mail Manual, incorporated by

reference in the Code of Federal

Regulations. See 39 CFR part 111.

List of Subjects in 39 CFR Part 111

Postal Service.

PART 111—-[AMENDED]

The authority citation for 39 CFR part

111 continues to read as follows:

Authority: 5 U.S.C. 552(a); 39 U.S.C. 101,

401, 403, 404, 3001–3011, 3201–3219, 3403–

3406, 3621, 3626, 5001.

2. Amend Domestic Mail Manual

E670.5.0, Eligible And Ineligible Matter,

by renumbering subsections 5.9 to 5.10,

5.10 to 5.11, 5.11 to 5.12, and 5.12 to

5.13, and adding a new subsection 5.9

to read as follows:

5.0 ELIGIBLE AND INELIGIBLE

MATTER

* * * * *

5.9 Contribution and Membership

Premiums

Announcements for premiums

received as a result of a contribution or

payment of membership dues are not

considered advertisements if the

requested contribution or membership

dues is at least 5 times the cost to the

nonprofit organization of the premium

item(s) offered and at least 3 times the

represented value in the mailpiece, if

any, of the premium item(s) offered.

* * * * *

3. An appropriate amendment to 39

CFR 111.3 to reflect these changes will

be published if the proposal is adopted.

R. Andrew German,

Acting Chief Counsel, Legislative.

[FR Doc. 97–23682 Filed 9–5–97; 8:45 am]

BILLING CODE 7710–12–U

GENERAL SERVICES

ADMINISTRATION

41 CFR Parts 101–1 and 101–46

RIN 3090–AG50

Replacement of Personal Property

Pursuant to the Exchange/Sale

Authority

AGENCY: Office of Governmentwide

Policy, GSA.

ACTION: Proposed rule.

SUMMARY: This proposed rule amends

regulations issued by GSA for

replacement of personal property

pursuant to the exchange/sale authority.

The exchange/sale authority permits

executive agencies when acquiring

replacement personal property, to

exchange or sell similar items and apply

the exchange allowance or proceeds of

sale in whole or in part payment for the

replacement property acquired. Changes

have been made to incorporate plain

English principles, streamline the

narrative, define key terms, update

organizational references, delete

outdated regulatory references, delegate

authority to executive agencies to

approve deviations under certain

conditions, and reduce restrictions and

limitations on use of the authority.

DATES: Comments must be received on

or before October 8, 1997.

ADDRESSES: Written comments should

be sent to the Personal Property

Management Policy Division (MTP),

Office of Governmentwide Policy,

General Services Administration, 1800 F

St., NW., Washington, DC 20405.

FOR FURTHER INFORMATION CONTACT:

Martha Caswell, Director, Personal

Property Management Policy Division

(202–501–3828).

SUPPLEMENTARY INFORMATION:

A. The General Services

Administration (GSA) has determined

that this rule is not a significant

regulatory action for the purposes of

Executive Order 12866 of September 30,

1993.

B. Regulatory Flexibility Act

This rule is not required to be

published in the Federal Register for

public comment. Therefore, the

Regulatory Flexibility Act does not

apply.

C. Paperwork Reduction Act

The Paperwork Reduction Act does

not apply because the proposed

revisions do not impose recordkeeping

or information collection requirements,

or the collection of information from

offerors, contractors, or members of the

public which require the approval of

OMB under 44 U.S.C. 501 et seq. This

rule also is exempt from Congressional

review prescribed under 5 U.S.C. 801

since it relates solely to agency

management and personnel. This rule is

written in a ‘‘plain English’’ style.

What is the ‘‘plain English’’ style of

regulation writing?

The ‘‘plain English’’ style of

regulation writing is a new, simpler to

read and understand, question and

answer regulatory format.

How does the plain English style of

regulation writing affect employees?

A question and its answer combine to

establish a rule. The employee and the

agency must follow the language

contained in both the question and its

answer.

List of Subjects in 41 CFR Parts 101–1

and 101–46:

Exchange/sale of government

property, government property

management.

Therefore, it is proposed that 41 CFR

Ch. 101 be amended set forth below:

PART 101–1—INTRODUCTION

1. The authority citation for 41 CFR

parts 101–1 and 101–46 continues to

read as follows:

Authority: Sec. 205(c), 63 Stat. 390 (40

U.S.C. 486(c)).

2. Section 101–1.110(a) is revised to

read as follows:
47180 Federal Register / Vol. 62, No. 173 / Monday, September 8, 1997 / Proposed Rules

§ 101–1.110 Deviations.

(a) In the interest of establishing and

maintaining uniformity to the greatest

extent feasible, except as otherwise

provided, deviations; i.e., the use of any

policy or procedure in any manner that

is inconsistent with the policy or

procedure prescribed in the Federal

Property Management Regulations, are

prohibited unless such deviations have

been requested from and approved by

the Administrator of General Services or

his authorized designee. Deviations may

be authorized by the Administrator of

General Services or his authorized

designee when so doing will be in the

best interest of the Government.

Requests for deviations shall clearly

state the nature of the deviation and the

reasons for such special action.

* * * * *

3. Part 101–46 is revised to read as

follows:

PART 101–46—REPLACEMENT OF

PERSONAL PROPERTY PURSUANT

TO THE EXCHANGE/SALE AUTHORITY

Sec.

101–46.000 What is the purpose and scope

of this part?

101–46.001 What are the definitions of

some of the key terms used in this part?

101–46.001–1 Acquire.

101–46.001–2 Combat material.

101–46.001–3 Exchange.

101–46.001–4 Exchange/sale.

101–46.001–5 Executive agency.

101–46.001–6 Federal agency.

101–46.001–7 Historic item.

101–46.001–8 Replacement.

101–46.001–9 Similar.

101–46.002–How do you request deviations

and who can approve them? .

101–46.002–1 Can you approve requests for

deviations from this Part 101–46? .

101–46.002–2 Does GSA approve requests

for deviations from this Part 101–46?

Subpart 101–46.1—[Reserved]

Subpart 101–46.2—Authorization

101–46.200 How do you determine whether

to do an exchange or sale?

101–46.201 When must you make a

reimbursable transfer to another Federal

agency when using the exchange/sale

authority, to what other organizations

may you make a reimbursable transfer,

and what are the conditions for a

reimbursable transfer?

101–46.202 What are the limitations on the

exchange/sale of personal property?

101–46.203 What special authorizations

have been made for use of the exchange/

sale authority?

Subpart 101–46.3—Exchange and Sale

Procedures

101–46.300 What are the exchange

procedures?

101–46.301 What are the sales procedures?

101–46.302 What are the accounting

requirements for the proceeds of sale?

Authority: Sec. 205(c), 63 Stat. 390 (40

U.S.C. 486(c)).

§ 101–46.000 What is the purpose and

scope of this part?

This part prescribes regulations for

use by you (an executive agency) when

using the exchange/sale authority of

section 201(c) of the Federal Property

and Administrative Services Act of

1949, 63 Stat. 384, as amended (40

U.S.C. 481(c)). The regulations apply to

all U.S. Government-owned personal

property worldwide. For the exchange/

sale of aircraft parts and hazardous

materials, you must meet the

requirements in this part and in parts

101–37 and 101–42 of this chapter,

respectively.

§ 101–46.001 What are the definitions of

some of the key terms used in this part?

§ 101–46.001–1 Acquire.

Acquire means procure or otherwise

obtain personal property, including by

lease.

§ 101–46.001–2 Combat material.

Combat material means arms,

ammunition, and implements of war

listed in the U.S. munitions list (22 CFR

part 121).

§ 101–46.001–3 Exchange.

Exchange means to replace a nonexcess or non-surplus personal property

item by trade or trade-in with the

supplier of the replacement item when

the allowance from the item being

replaced is used to reduce or offset the

cost of the replacement item. The

supplier may be a Government agency,

commercial or private organization, or

an individual.

§ 101–46.001–4 Exchange/sale.

Exchange/sale means to exchange or

sell a non-excess or non-surplus

personal property item and apply the

exchange allowance or proceeds of sale

in whole or in part payment for the

acquisition of a similar item.

§ 101–46.001–5 Executive agency.

Executive agency means any

executive department or independent

establishment in the executive branch of

the Government, including any wholly

owned Government corporation.

§ 101–46.001–6 Federal agency

Federal agency means any executive

agency or any establishment in the

legislative or judicial branch of the

Government (except the Senate, the

House of Representatives, and the

Architect of the Capitol and any

activities under his direction).

§ 101–46.001–7 Historic item.

Historic item means property having

added value for display purposes

because its historical significance is

greater than its fair market value for

continued use. Items that are commonly

available and remain in use for their

intended purpose, such as military

aircraft still in use by active or reserve

units, are not historic items.

§ 101–46.001–8 Replacement.

Replacement means the process of

acquiring property specifically to be

used in place of property which is still

needed but will no longer adequately

perform all the tasks for which it is

used.

§ 101–46.001–9 Similar.

Similar means that the acquired item

and replaced item:

(a) Are identical; or

(b) Are designed and constructed for

the same specific purpose; or

(c) Both constitute parts or containers

for identical or similar end items; or

(d) Both fall within a single Federal

Supply Classification (FSC) group of

property that is eligible for handling

under the exchange/sale authority.

§ 101–46.002 How do you request

deviations and who can approve them?

General provisions for deviations

from the Federal Property Management

Regulations are found in § 101–1.110 of

this chapter. Provisions for deviations

from the regulations in this part are

presented in this section.

§ 101–46.002–1 Can you approve requests

for deviations from this part 101–46?

The head of an executive agency may

approve deviations within the agency.

This authority cannot be redelegated.

Only onetime (individual) deviations

may be approved by the head of an

executive agency. GSA must approve

any class deviations. The head of an

executive agency may not approve

deviations that would permit the

exchange/sale of weapons. Also, neither

the head of an executive agency nor

GSA may approve deviations from

regulatory provisions that are mandated

by statute e.g., the requirement that the

exchange/sale authority be used for

replacement property only, and the

requirement that property replaced and

property acquired are similar. In the

interest of maintaining uniformity,

deviations shall be kept to a minimum

and the head of an executive agency

shall prescribe a formal procedure for

the control of deviations within the

agency and furnish a copy of the

procedure to GSA. Also, a copy of each

approved deviation shall be furnished to

GSA upon its approval.
Federal Register / Vol. 62, No. 173 / Monday, September 8, 1997 / Proposed Rules 47181

§ 101–46.002–2 Does GSA approve

requests for deviations from this part 101–

46?

If you choose not to exercise the

authority delegated to you by GSA in

the preceding section, or if GSA

approval of a deviation request is

necessary, you may request GSA

approval of deviations by submitting a

complete written justification to the

General Services Administration (GSA),

Office of Governmentwide Policy, Office

of Transportation and Personal Property

(MT), Washington, DC 20405.

Subpart 101–46.1—[Reserved]

Subpart 101–46.2—Authorization

§ 101–46.200 How do you determine

whether to do an exchange or sale?

(a) When considering use of the

exchange/sale authority, you must

determine which of the two methods—

exchange or sale—will provide the

greater return for the Government.

When estimating the return under each

method, consider all administrative and

overhead costs.

(b) If the exchange allowance or

estimated sales proceeds for an item of

property would be unreasonably low,

the property should not be processed

under this part. Rather, you should

process it according to the regulations in

part 101–43 (Utilization of Personal

Property) of subpart 101–45.9

(Abandonment or Destruction of

Personal Property) of this subchapter as

applicable.

§ 101–46.201 When must you make a

reimbursable transfer to another Federal

agency when using the exchange/sale

authority, to what other organizations may

you make a reimbursable transfer, and what

are the conditions for a reimbursable

transfer?

(a) If you have property you want to

replace which is eligible for exchange/

sale, you should, to the maximum

extent practicable, first solicit Federal

agencies known to use or distribute

such property and, if an agency wants

it, arrange for a reimbursable transfer.

Property that is eligible for replacement

under replacement standards prescribed

in subpart 101–25.4 of this chapter is

not subject to this requirement.

(b) You may make a reimbursable

transfer to not only other Federal

agencies, but also the Senate, the House

of Representatives, the Architect of the

Capitol and any activities under the

Architect’s direction, the District of

Columbia, and mixed-ownership

Government corporations.

(c) When transferring property:

(1) You must do so under terms

mutually agreeable to you and the

recipient; and

(2) You must not require

reimbursement of an amount greater

than the estimated fair market value of

the transferred property; and

(3) You must apply the transfer

proceeds in whole or part payment for

property acquired to replace the

transferred property.

§ 101–46.202 What are the limitations on

the exchange/sale of personal property?

This section describes: Types of

property that are ineligible for

exchange/sale; conditions that you must

meet when conducting an exchange/sale

transaction; and actions that are

prohibited in an exchange/sale

transaction;

(a) What types of property are

ineligible for exchange/sale?

(1) You must not use the exchange/

sale authority for the following FSC

groups of personal property:

10 Weapons.

11 Nuclear ordnance.

12 Fire control equipment.

14 Guided missiles.

15 Aircraft and airframe structural

components, except FSC class 1560

Airframe Structural Components.

42 Firefighting, rescue, and safety

equipment.

44 Nuclear reactors (FSC class 4472 only).

51 Hand tools.

54 Prefabricated structure and scaffolding.

68 Chemicals and chemical products,

except medicinal chemicals.

71 Furniture.

84 Clothing, individual equipment, and

insignia.

(2) Also ineligible for exchange/sale

are materials in the National Defense

Stockpile (50 U.S.C. 98–98h) or the

Defense Production Act inventory (50

U.S.C. App. 2093).

(b) What conditions must be met

when conducting an exchange/sale

transaction? You may use the exchange/

sale authority only if you meet all six of

the following conditions:

(1) The item exchanged or sold is

similar to the item acquired; and

(2) The item exchanged or sold is not

excess or surplus, and the item acquired

is needed for approved programs; and

(3) The number of items acquired

must equal the number of items

replaced unless:

(i) The item(s) acquired perform all or

substantially all of the tasks for which

the old item(s) would otherwise be

used; or

(ii) The item(s) sold or exchanged and

the item(s) acquired meet the test for

similarity specified at § 101–46.001–

9(iii) in that they are a part(s) or

container(s) for identical or similar end

items; and

(4) The item exchanged or sold was

acquired for official use and not for the

principal purpose of exchange or sale;

and

(5) You make a written administrative

determination at the time of exchange or

sale (or at the time of acquisition if it

precedes the sale) to apply the exchange

allowance or sale proceeds to the

acquisition of replacement property;

and

(6) You document that the above

conditions have been met, a along with

all other pertinent documentation, for

any transactions under this part.

(c) What actions are prohibited in an

exchange/sale transaction?

(1) Acquisition of personal property

not otherwise authorized.

(2) Acquisition of personal property

in violation of:

(i) Any restriction on procurement of

a commodity or commodities; or

(ii) Any replacement policy or

standard prescribed by the President,

the Congress, or the Administrator of

General Services; or

(iii) Any contractual obligation.

(3) Transfer, exchange, or sale of

Nuclear Regulatory Commissioncontrolled materials unless you meet the

requirements of § 101–42.1102–4 of this

subchapter.

(4) Exchange or sale of controlled

substances, unless you meet the

requirements of § 101–42.1102–3 of this

subchapter.

(5) Transfer, exchange, or sale of scrap

materials, except in the case of scrap

gold for fine gold.

(6) Exchange or sale of property

which was originally acquired as excess

or forfeited property or from another

source other than new procurement,

unless such property has been in official

use by the acquiring agency for at least

1 year. You may exchange or sell

forfeited property in official use for less

than 1 year if the head of your agency

certifies that a continuing valid

requirement exists, but the specific item

in use no longer meets that requirement,

and that exchange or sale meets all other

requirements of this part.

(7) Exchange or sale of property that

is dangerous to public health or safety

without first rendering such property

innocuous or providing for adequate

safeguards as part of the exchange/sale.

(8) Exchange or sale of combat

material without first demilitarizing it

in accordance with applicable

regulations.

(9) Exchange or sale of Flight Safety

Critical Aircraft Parts unless you meet

the provisions of § 101–37.610 of this

chapter.
47182 Federal Register / Vol. 62, No. 173 / Monday, September 8, 1997 / Proposed Rules

§ 101–46.203 What special authorizations

have been made for use of the exchange/

sale authority?

(a) You may exchange, without

monetary appraisal or detailed listing or

reporting, books and periodicals in your

libraries not needed for permanent use

for other books and periodicals.

(b) In acquiring items for historical

preservation or display at Federal

museums, you may exchange historic

items in the museum property account

without regard to the FSC group or the

requirement in § 101–46.202(b)(3),

provided the exchange transaction is

documented and certified by the head of

your agency to be in the best interests

of the Government and all other

provisions of this part are met. The

documentation must contain a

determination that the item exchanged

and the item acquired are historic items.

Subpart 101–46.3—Exchange and Sale

Procedures

§ 101–46.300 What are the exchange

procedures?

(a) Most exchange transactions should

occur when a vendor delivers a

replacement item and removes the item

being replaced. This is the most efficient

and cost effective exchange procedure

because the item being replaced may

remain in use up to the time the

replacement item is delivered, when it

is immediately removed by the vendor,

and storage, handling, and

administrative costs are minimized.

(b) You may internally reassign

eligible items no longer needed by one

organizational unit to another unit for

exchange with the supplier of a

replacement item. Physical movement

of the reassigned item is not required

unless specified by the contract.

§ 101–46.301 What are the sales

procedures?

(a) The methods of sale, terms and

conditions of sale, and forms prescribed

in § 101–45.304 of this subchapter shall

be used in the sale of property being

replaced, except for the provisions of

§ 101–45.304–2(a) of this subchapter

regarding negotiated sales. Section 3709,

Revised Statutes (41 U.S.C. 5), is

applicable to such sales and specifies

the following conditions under which

property being replaced can be sold by

negotiation:

(1) The reasonable value involved in

the contract does not exceed $500, or

(2) Otherwise authorized by law.

(b) Property eligible for exchange/sale

may be sold by negotiation at fixed

prices in accordance with the provisions

of § 101–45.304–2(b) of this subchapter.

§ 101–46.302 What are the accounting

requirements for the proceeds of the sale?

Except as otherwise authorized by

law, proceeds from sales of personal

property disposed of under this part

must be accounted for in accordance

with the General Accounting Office

Policy and Procedures Manual for

Guidance of Federal Agencies, Title 7,

Fiscal Procedures, Section 5.5D.

Dated: September 2, 1997.

G. Martin Wagner,

Associate Administrator for Governmentwide

Policy.

[FR Doc. 97–23669 Filed 9–5–97; 8:45 am]

BILLING CODE 6820–24–M

DEPARTMENT OF HEALTH AND

HUMAN SERVICES

Office of Inspector General

42 CFR Parts 1000, 1001, 1002 and

1005

RIN 0991–AA87

Health Care Programs: Fraud and

Abuse; Revised OIG Exclusion

Authorities Resulting From Public Law

104–191

AGENCY: Office of Inspector General

(OIG), HHS.

ACTION: Notice of proposed rulemaking.

SUMMARY: This rulemaking addresses

proposed revisions to the OIG’s sanction

authorities in conjunction with sections

211, 212 and 213 of the Health

Insurance Portability and

Accountability Act of 1996, along with

other technical and conforming changes

to the OIG exclusion authorities set

forth in 42 CFR parts 1000, 1001, 1002

and 1005. These proposed revisions are

specifically designed to expand the

protection of certain basic fraud

authorities, and revise and strengthen

the current legal authorities pertaining

to exclusions from the Medicare and

State health care programs.

DATES: To assure consideration, public

comments must be delivered to the

address provided below by no later than

5 p.m. on November 7, 1997.

ADDRESSES: Please mail or deliver your

written comments to the following

address: Office of Inspector General,

Department of Health and Human

Services, Attention: OIG–20–P, Room

5246, Cohen Building, 330

Independence Avenue, S.W.,

Washington, D.C. 20201. Because of

staffing and resource limitations, we

cannot accept comments by facsimile

(FAX) transmission. In commenting,

please refer to file code OIG–20–P.

FOR FURTHER INFORMATION CONTACT:

Joel Schaer, (202) 619–0089, OIG

Regulations Officer.

SUPPLEMENTARY INFORMATION: Comments

will be available for public inspection

September 22, 1997 in Room 5550 of the

Office of Inspector General at 330

Independence Avenue, S.W.,

Washington, D.C., on Monday through

Friday of each week from 8:00 a.m. to

4:30 p.m., (202) 619–0089.

I. Background

A. Overview of OIG Exclusion

Authorities

All exclusions imposed by the Office

of Inspector General (OIG) are based on

the authorities set forth in sections

1128, 1156 and 1892 of the Social

Security Act (Act). In imposing these

exclusions, the Secretary’s primary

objective and obligation is to protect the

health and safety of patients receiving

care under the Medicare and State

health care programs, and to safeguard

the integrity of these programs. The

authorities contained in these sections

of the Act were designed to protect the

programs and their beneficiaries from

unfit health care providers, individuals

and businesses whose behavior has

demonstrated that they pose a risk to

program beneficiaries or to the integrity

of the Medicare and State health care

programs.

In 1987, the OIG’s civil administrative

sanction authorities were significantly

revised and expanded by the Medicare

and Medicaid Patient and Program

Protection Act (MMPPPA), Public Law

100–93. Congress enacted MMPPPA ‘‘to

improve the ability of the [Department]

to protect the Medicare and Medicaid

programs for fraud and abuse, and to

protect the beneficiaries of these

programs from incompetent practioners

and from inappropriate and inadequate

care.’’ MMPPPA authorized both

mandatory and discretionary program

exclusions intended to protect the

integrity of the Medicare and State

health care programs, as well as

beneficiaries.

Manadatory exclusions. Section

1128(a) of the Act specifically sets forth

the exclusion authorities with

mandated enforcement provisions. This

section of the Act requires the OIG to

exclude from program participation any

individuals or entities convicted of a

program-related crime or patient abuse

or neglect. These mandatory exclusions

must be imposed for a minimum 5-year

period.

Permissive exclusions. In addition,

section 1128(b) sets forth a variety of

sanction authorities all of which are

permissive authorities that do not