`[Federal Register Volume 77, Number 52 (Friday, March 16, 2012)]
[Proposed Rules]
[Pages 15681-15701]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2012-6165]


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DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT

48 CFR Parts 2401, 2402, 2403, 2404, 2406, 2407, 2409, 2415, 2416, 
2417, 2419, 2426, 2427, 2428, 2432, 2437, 2439, 2442, and 2452

[Docket No FR-5571-P-01]
RIN 2501-AD56


Amendments to the HUD Acquisition Regulation (HUDAR)

AGENCY: Office of the Chief Procurement Officer, HUD.

ACTION: Proposed rule.

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SUMMARY: This proposed rule would amend the HUDAR to implement 
miscellaneous changes. These changes include, for example, such 
amendments as removing provisions that are now obsolete, refining 
provisions to approve

[[Page 15682]]

requests for deviation from the HUDAR, updating provisions that address 
the organizational structure of HUD, and adding provisions on 
contractor record retention.

DATES: Comment Due Date: May 15, 2012.

ADDRESSES: Interested persons are invited to submit comments regarding 
this proposed rule to the Regulations Division, Office of General 
Counsel, Department of Housing and Urban Development, 451 7th Street 
SW., Room 10276, Washington, DC 20410-0500. Communications must refer 
to the above docket number and title. There are two methods for 
submitting public comments. All submissions must refer to the above 
docket number and title.
    1. Submission of Comments by Mail. Comments may be submitted by 
mail to the Regulations Division, Office of General Counsel, Department 
of Housing and Urban Development, 451 7th Street SW., Room 10276, 
Washington, DC 20410-0500.
    2. Electronic Submission of Comments. Interested persons may submit 
comments electronically through the Federal eRulemaking Portal at 
www.regulations.gov. HUD strongly encourages commenters to submit 
comments electronically. Electronic submission of comments allows the 
commenter maximum time to prepare and submit a comment, ensures timely 
receipt by HUD, and enables HUD to make them immediately available to 
the public. Comments submitted electronically through the 
www.regulations.gov Web site can be viewed by other commenters and 
interested members of the public. Commenters should follow the 
instructions provided on that site to submit comments electronically.

    Note: To receive consideration as public comments, comments must 
be submitted through one of the two methods specified above. Again, 
all submissions must refer to the docket number and title of the 
rule.

    No Facsimile Comments. Facsimile (Fax) comments are not acceptable.
    Public Inspection of Public Comments. All properly submitted 
comments and communications submitted to HUD will be available for 
public inspection and copying between 8 a.m. and 5 p.m. weekdays at the 
above address. Due to security measures at the HUD Headquarters 
building, an advance appointment to review the public comments must be 
scheduled by calling the Regulations Division at 202-402-3055 (this is 
not a toll-free number). Individuals with speech or hearing impairments 
may access this number via TTY by calling the Federal Information Relay 
Service, toll-free, at 800-877-8339. Copies of all comments submitted 
are available for inspection and downloading at www.regulations.gov.

FOR FURTHER INFORMATION CONTACT: Elie F. Stowe, Assistant Chief 
Procurement Officer for Policy, Oversight, and Systems, Office of the 
Chief Procurement Officer, Department of Housing and Urban Development, 
451 7th Street SW., Washington, DC 20410, telephone number 202-708-
0294, fax number 202-708-8912 (these are not toll-free numbers). 
Persons with hearing or speech impairments may access that number via 
TTY by calling the toll-free Federal Relay Service at 800-877-8339.

SUPPLEMENTARY INFORMATION:

I. Background

    The uniform regulation for the procurement of supplies and services 
by federal departments and agencies, the Federal Acquisition Regulation 
(FAR), was promulgated on September 19, 1983 (48 FR 42102). The FAR is 
codified in title 48, chapter 1, of the Code of Federal Regulations. 
HUD promulgated its regulation to implement the FAR on March 1, 1984 
(49 FR 7696).
    The HUDAR (title 48, chapter 24 of the Code of Federal Regulations) 
is prescribed under section 7(d) of the Department of HUD Act (42 
U.S.C. 3535(d)); section 205(c) of the Federal Property and 
Administrative Services Act of 1949 (40 U.S.C. 121(c)); and the general 
authorization in FAR 1.301. HUDAR was last revised by final rule 
published on January 13, 2006 (71 FR 2432).

 II. This Proposed Rule

    This proposed rule would amend the HUDAR as follows:
    Sections 2401.403 (Individual deviations) and 2401.404 (Class 
deviations) are proposed to be revised to move procedural requirements 
on requesting deviations from the FAR. These requirements are proposed 
to be moved to a new 2401.471, entitled ``Requests for Deviations--FAR 
and HUDAR,'' which would contain requirements for both FAR and HUDAR 
deviation requests. As proposed, 2401.403 and 2401.404 would be revised 
to remove procedural guidance and merely state the designation of the 
Senior Procurement Executive (SPE) as the approving authority.
    A new 2401.470, ``Deviations from the HUDAR,'' is proposed to be 
added to state the SPE's authority to approve deviations from the 
HUDAR. Previously, this authority was comingled with the SPE's 
authority as the agency head's designee to authorize FAR deviations in 
sections 2401.403 and 2401.404.
    In subpart 2401.6 (Career Development, Contracting Authority and 
Responsibilities), (b)(1) of 2401.602-3 (Ratification of unauthorized 
commitments) is proposed to be revised to remove obsolete language 
concerning HUD's former field contracting organizational structure. 
Paragraph (b)(3) is revised also to authorize the SPE to delegate 
approval of lower-dollar value ratifications down to Assistant Chief 
Procurement Officer level. Paragraph (c)(7), which provided guidance to 
HUD personnel on the internal processing of requests for ratifications, 
has been removed in its entirety. That guidance is now contained in 
internal acquisition policy directives.
    In part 2402, ``Definitions of Words and Terms,'' subpart 2402.1, 
``Definitions,'' 2402.101, ``Definitions,'' is proposed to be revised 
to add a definition of contracting activity, and change the definitions 
of the head of the contracting activity (HCA) and legal counsel to 
reflect the current Departmental organizational structure. The Office 
of the Chief Procurement Officer (OCPO) is now responsible for all HUD 
acquisition, and the Chief Procurement Officer (CPO) serves as the sole 
HCA. The revised HCA definition authorizes the CPO to delegate HCA 
authority down to, but not below, the level of the Assistant CPOs when 
the FAR and HUDAR permit such delegation.
    In part 2403, ``Improper Business Practices and Personal Conflicts 
of Interest,'' subpart 2403.4, ``Contingent Fees,'' 2403.405((b)) is 
proposed to be revised to remove language that is redundant to FAR 
3.405.
    In part 2404, ``Administrative Matters,'' a new subpart 2404.7, 
entitled ``Contractor records retention,'' is proposed to be added. 
Within this new subpart, 2404.7001, ``Contract Clause,'' is proposed to 
be added to prescribe the use of a new contract clause at 2452.204-70, 
Preservation of, and Access to, Contract Records (Tangible and 
Electronically Stored Information (ESI) Formats). The clause would be 
added to ensure that contractors preserve information and provide it to 
HUD upon request for the purpose of discovery required by actual or 
anticipated litigation.
    In part 2406, ``Competition Requirements,'' subpart 2406.3, ``Other 
than Full and Open Competition,'' 2406.302-2, ``Unusual and compelling 
urgency,'' is proposed to be added to authorize the HCA to act as the 
agency head with regard to making

[[Page 15683]]

determinations required by FAR 6.302-2(d)(1)(ii).
    Section 2406.304-70, ``Approval of the justification--field 
procurements,'' is removed in its entirety. As currently written, 
2406.304-70 requires that justifications for other than full and open 
competition exceeding $1 million arising in OCPO's field offices be 
approved by the Deputy Chief Procurement Officer. This requirement 
reflects a former organization of HUD's contracting activities and is 
now obsolete. All HUD contracting personnel are now part of a single 
OCPO. Consequently, the processing requirements for justifications are 
the same for all OCPO offices. Furthermore, this lower approval 
threshold does not correspond to the approval thresholds set forth in 
FAR 6.304.
    In subpart 2406.5, ``Competition Advocates,'' 2406.501, 
``Requirement,'' is proposed to be revised to remove the requirement 
for publication of a notice in the Federal Register when appointing a 
Competition Advocate. The section is also revised to clarify that the 
SPE is the head of the agency for the purposes of FAR 6.501.
    In part 2407, ``Acquisition Planning,'' subpart 2407.1, 
``Acquisition Plans,'' 2407.102, ``Policy,'' is proposed to be revised 
to remove an obsolete reference to the Department's Advance Acquisition 
Planning System, which is no longer used.
    In part 2409, ``Contractor Qualifications,'' a new subpart 2409.4, 
``Debarment, Suspension, and Ineligibility,'' is proposed to be added, 
and the content currently under 2409.7001, ``HUD regulations on 
debarment, suspension, and ineligibility,'' would be moved to this new 
subpart and redesignated. Additionally, 2409.405, ``Effect of 
listing,'' and 2409.407-1, ``General,'' would be added to delegate 
agency head authorities to the SPE. The content of current 2409.7001 is 
proposed to be moved to the new 2409.470 with the same title, to more 
accurately correspond to the FAR and would be revised to correct the 
Code of Federal Regulations citation. Current subpart 2409.70 would be 
accordingly removed, as 2409.7001 was the only section in that subpart.
    In part 2415, ``Contracting by Negotiation,'' subpart 2415.2, 
``Solicitation and Receipt of Proposals and Quotations,'' the following 
changes would be made: new section 2415.203, ``Requests for 
proposals,'' would authorize contracting officers to limit the size of 
technical and management portions of offers submitted in response to 
requests for proposals; section 2415.204, ``Contract format,'' would be 
revised to delete the word ``cognizant,'' since HUD now has a single 
HCA; section 2415.209, ``Solicitation provisions and contract 
clauses,'' would be revised to prescribe the use of a new Alternate III 
to the solicitation provision at 2452.215-70, ``Proposal content,'' 
when the contracting officer determines that it is necessary to limit 
the size of the technical and management portion of offers submitted by 
offerors; and section 2415.209 would be revised to prescribe the use of 
a new provision at 2452.215-71, ``Relative Importance of Technical 
Evaluation Factors to Cost or Price,'' in solicitations using the 
tradeoff selection method. The provision notifies offerors of the 
relative weight of the technical evaluation factors to cost or price 
when evaluating offers for contract award. The contracting officer 
selects the relative weighting to be used.
    In subpart 2415.3, ``Source selection,'' in 2415.303, 
``Responsibilities,'' paragraph (a) would be revised to designate the 
SPE as the agency head for the purposes of designating source selection 
authorities other than the contracting officer as provided for at FAR 
15.303(a). Paragraph (b) would be redesignated (b)(1) and revised to 
remove the specific number of participants to be used on a technical 
evaluation panel. The removal of a specific number of panelists would 
permit contracting officers and requiring activities to determine the 
appropriate number of evaluation panelists on a case-by-case basis.
    Section 2415.304, ``Evaluation factors and significant 
subfactors,'' would be revised to remove paragraph (d)(2), which 
contains a requirement for numerical scoring of technical proposals 
when selecting awardees for negotiated contracts. HUD's policy is to 
not use numerical scoring. Therefore, this requirement is no longer 
applicable. A new paragraph (c)(3)(i) would be added to require the 
evaluation of small business participation in acquisitions using the 
tradeoff source selection process.
    In 2415.305, ``Proposal evaluation,'' paragraph (a)(3) would be 
revised to change the reference from ``predetermined cut-off scores'' 
to ``predetermined threshold levels of technical acceptability,'' in 
accordance with the revision to section 2415.304.
    A new 2415.370, ``Solicitation provision,'' would be added to 
prescribe the use of a new solicitation provision at 2452.215-72, 
``Evaluation of Small Business Participation.'' This provision would be 
required for contracts that use the FAR clause at 52.219-9, ``Small 
Business Subcontracting Plan.''
    In part 2416, ``Types of Contracts,'' a new subpart 2416.3, ``Cost-
Reimbursement Contracts,'' would be added. Under this new subpart, 
section 2416.307, ``Contract clauses,'' would be added to prescribe the 
use of two new contract clauses: 2452.216-79, ``Estimated Cost (No 
Fee),'' to be included in all cost-reimbursement (no fee) type 
solicitations and contracts; and 2452.216-80, ``Estimated Cost and 
Fixed-Fee,'' to be included in all cost-plus-fixed fee type 
solicitations and contracts. The clauses provide standard contract 
language regarding total estimated cost, fee, and level of funding if 
the contract is funded incrementally.
    In subpart 2416.5, ``Indefinite-delivery contracts,'' 2416.505, 
``Ordering,'' would be revised to remove language redundant to FAR 
16.505 and to reflect the change in OCPO organization under which there 
is now one contracting activity and therefore, one ombudsman. Paragraph 
(b)(5) would be redesignated as (b)(6) to correspond with that of FAR 
16.505(b)(6).
    In 2416.506-70, ``Solicitation provisions and contract clauses,'' 
paragraph (b) would be revised to remove the reference to definite-
quantity contracts, to permit the tailoring of the clause as needed for 
specific contracts, and to remove the prescription for an alternate to 
the clause. In part 2417, ``Special Contracting Methods,'' under 
subpart 2417.2, ``Options,'' 2417.204(e), would be revised to: under 
the authority of FAR 17.204(e), establish the SPE as the approving 
official for contracts proposed to exceed 5 years; define the contract 
period of indefinite-delivery contracts as the ordering period for the 
purposes of requiring prior approval; prohibit the use of SPE approval 
retroactively to extend contract periods; and clarify that SPE approval 
is not required for options properly exercised pursuant to FAR clause 
52.217-8, ``Option to Extend Services.''
    In part 2419, ``Small Business Programs,'' under subpart 2419.2, 
``Policies,'' 2419.201 would be revised to correct the designation of 
the paragraphs to match paragraph designations in the parallel section 
in FAR 19.201. The following additional substantive revisions are 
proposed: remove the reference to HUD Headquarters in paragraph (d); in 
the same paragraph, reference FAR 19.201(d); and clarify that the 
Director of the Office of Small and Disadvantaged Business Utilization 
appoints small business specialists. Previously, this section required 
the HCAs to appoint such specialists.

[[Page 15684]]

    In subpart 2419.5, ``Set-Asides for Small Business,'' 2419.503, 
``Setting aside a class of acquisitions,'' is proposed to be removed. 
This section requires that all contracts for construction services that 
support the Real Estate Owned program of the Federal Housing 
Administration (FHA) be set aside for small business. This requirement 
exceeds the FAR's requirements. Normal compliance with FAR part 19 
should result in the maximum practicable use of small business set-
asides.
    In subpart 2419.7, ``The Small Business Subcontracting Program,'' 
in 2419.708, ``Solicitation Provisions and Contract Clauses,'' a new 
paragraph (b) would be added to prescribe the use of a new clause at 
2452-219-73, ``Incorporation of Subcontracting Plan,'' in contracts 
when a subcontracting plan is required. Paragraph (b) would also 
prescribe the use of a new provision at 2452.219-74, ``Small Business 
Subcontracting Goals,'' for solicitations that are required to include 
the FAR clauses at 52.219-8, ``Utilization of Small Business Concerns'' 
and at 52.219-9, ``Small Business Subcontracting Plan.'' The provision 
provides offerors with HUD's small business subcontracting goals. 
Paragraph (d), currently the only paragraph in the section, would be 
revised to correct the applicable dollar threshold, by replacing the 
current dollar figure with a cross-reference, and to clarify that the 
provision is required when the use of the FAR clause at 52.219-9 is 
required.
    Subpart 2419.8, ``Small Business Administration Section (8)(a) 
Program,'' would be revised to implement the terms of HUD's current 
partnership agreement with the SBA, under which the SBA has delegated 
to HUD's SPE its authority under section 8(a)(1)(A) of the Small 
Business Act (5 U.S.C. 637(a)) to enter into 8(a) prime contracts, as 
well as its authority under 8(a)(1)(B) of the Small Business Act to 
award the performance of those contracts to eligible 8(a) Program 
participants. The revised subpart 2419.8 implements the specific terms 
and guidance contained in the agreement. Note that SBA provided HUD 
with the specific verbiage for use in implementing the agreement in 
HUD's FAR supplement.
    In subpart 2419.8, the following new sections would be added:
    Section 2419.803, ``Selecting acquisitions for the 8(a) Program,'' 
would be added to include an new subsection 2419.803-70, which would 
provide direction on the use of simplified acquisitions (as defined at 
FAR 2.101) under the Partnership Agreement.
    Section 2419.804 would be added to include three new subsections as 
follows:
    Subsection 2419.804-2, ``Agency offering,'' would be added to 
require that for 8(a) contracts to be awarded under the Partnership 
Agreement, HUD's agency offering letters to the 8(a) firms identify 
that the offering is in accordance with the Partnership Agreement. 
Subsection 2419.804-3, ``SBA acceptance,'' would be added to include a 
new subsection 2419.804-370, ``SBA acceptance under partnership 
agreements for acquisitions exceeding the simplified acquisition 
threshold,'' to provide the procedures for SBA's acceptance of HUD 
offerings for 8(a) contracts that exceed the simplified acquisition 
threshold.
    Section 2419.805, ``Competitive 8(a),'' would be added to include a 
new subsection 2419.805-2, ``Procedures,'' which would provide the 
procedures for notifying the SBA of selected offerors for award under 
competitive 8(a) contracts awarded under the Partnership Agreement and 
for the SBA's verification of the awardees' eligibility under the 8(a) 
Program.
    Section 2419.806, ``Pricing the 8(a) contract,'' would be added to 
require HUD contracting officers to obtain certified cost or pricing 
data directly from the 8(a) contractor when required by FAR subpart 
15.4 when awarding contracts under the Partnership Agreement.
    Section 2419.808, ``Contract negotiation,'' would be added to 
provide a new subsection 2419.808-1, ``Sole source,'' which would make 
the 8(a) contractor responsible for negotiating a contract with HUD 
within the time frame established by the HUD contracting officer. 
Subsection 2419.808-1 would also permit HUD, after notification to and 
approval by the SBA, to proceed with the acquisition from other sources 
if an 8(a) contractor does not negotiate within the established time 
frame and if HUD cannot allow additional time. Furthermore, if the 
acquisition is conducted under the Partnership Agreement, HUD would be 
delegated the authority to negotiate directly with the 8(a) 
participant; however, if requested by the 8(a) participant, the SBA 
might participate in such negotiations.
    Section 2419.811, ``Preparing the contracts,'' would be added to 
include the following:
    A new subsection 2419.811-1, ``Sole source,'' would be added to 
provide procedures for the preparation of sole source 8(a) contract 
awards made under the Partnership Agreement.
    A new subsection 2419.811-2, ``Competitive,'' would be added to 
state that the contract preparation procedures for sole source 8(a) 
contracts shall be used for competitive 8(a) contracts awarded under 
the Partnership Agreement.
    A new subsection 2419.811-3, ``Contract clauses,'' would be added 
to prescribe HUDAR clauses to be used in place of certain FAR clauses 
for 8(a) contracts awarded under the Partnership Agreement.
    Section 2419.812, ``Contract administration,'' would be added to 
state that 8(a) contractors whose contracts are awarded under the 
Partnership Agreement are required to notify both the HUD contracting 
officer and the SBA whenever the ownership of the 8(a) firm is 
transferred.
    In part 2426, ``Other Socioeconomic Programs,'' 2426.7001, 
``Policy,'' and 7002, ``Responsibility,'' are proposed to be removed. 
The content of these sections is essentially redundant to FAR 19.201 
and HUDAR 2419.201. Accordingly, subpart 2426 is removed and reserved.
    In part 2427, ``Patents, Data, and Copyrights,'' the title of 
2427.305-2 is proposed to be revised to ``Administration by the 
Government'' to correspond to the title of FAR 27.305-2.
    A new 2427.470, ``Contract clause,'' is proposed to be added to 
prescribe the use of new clause 2452.227-70, ``Government 
Information,'' in solicitations and contracts when the Federal 
Government will provide information to the contractor or the contractor 
will obtain information on behalf of the Federal Government to perform 
work required under the contract. In order to accommodate this new 
section, subpart 2427.4 would be added, as authorized by FAR, and by 48 
CFR subpart 27.4, ``Rights in Data and Copyrights.''
    In part 2428, ``Bonds and Insurance,'' the title of 2428.106 is 
proposed to be revised to ``Administration,'' to correspond to the 
title of FAR 28.106.
    In part 2432, ``Contract Financing,'' new 2432.006, ``Reduction or 
suspension of contract payments upon finding of fraud,'' 2432.006-1, 
``General,'' and 2432.006-2, ``Definitions,'' are proposed to be added 
to delegate certain agency head authorities to the SPE with regard to 
reducing or suspending contract payments in cases of fraud. The SPE is 
designated as the ``remedy coordination official,'' and may delegate 
the responsibilities of the remedy

[[Page 15685]]

coordination official to appropriate personnel within the OCPO.
    A new 2432.007 would be added to designate the SPE as the agency 
head for the purpose of establishing contract financing payment periods 
of shorter than 30 days.
    A new subpart 2432.7, ``Contract Funding,'' is added to provide 
authority for, and limitations on the use of, incrementally funded 
fixed-price contracts. New 2432.702, ``Policy,'' 2432.703-1, 
``General,'' 2432.704, ``Limitation of cost or funds,'' and 2432.705, 
``Contract clauses,'' would be added to subpart 2432.7. The use of 
incrementally funded fixed-price contracts is necessitated by recurring 
budget and funding uncertainties. However, the new subpart will limit 
the use of this method of contract funding to contracts for severable 
services not exceeding one year in length that are incrementally 
funded, using funds available as of the date that the funds are 
obligated or that funds are available from multiple fiscal years and 
Congress has otherwise authorized incremental funding. Accordingly, a 
new clause at 2452.232-72, Limitation of Government's obligation,'' 
also would be added.
    In subpart 2432.9, ``Prompt Payment,'' 2432.903, ``Policy,'' would 
be revised to correct the reference to FAR 32.903(a). Also, 2432.906 
would be revised to specifically designate the head of the contracting 
activity as the agency head for the purposes of making the 
determination required by FAR 32.906 to make invoice payments earlier 
than 7 days prior to the due dates specified in the contract.
    In section 2432.908, ``Contract clauses,'' a new paragraph (c) 
would be added, following FAR 32.908(c), to prescribe the use of a new 
clause in 2452.232-73, ``Constructive Acceptance Period,'' in 
solicitations and contracts when the contracting officer has determined 
that an acceptance period longer than the 7 days provided for in FAR 
52.232-25, ``Prompt Payment,'' is needed.
    In part 2437, ``Service Contracting,'' under subpart 2437.1, 
``Service Contracts--General,'' in 2437.110, ``Solicitation provisions 
and contract clauses,'' paragraph (d) is removed from this section and 
redesignated as 2401.106-70, ``Contract clause.'' Paragraphs (a), (c), 
and (e) are redesignated (e)(1), (e)(2), and (e)(3), respectively, to 
better correspond to FAR 37.110(e). Redesignated paragraph (e)(3) would 
be revised to include the version of this paragraph that had been 
authorized via deviation and to clarify that the access requirements of 
2452.237-75, ``Access to HUD facilities,'' apply to contractors who 
require regular access to HUD facilities versus infrequent visitors to 
HUD facilities.
    In part 2439, ``Acquisition of Information Technology,'' 2439.107, 
``Contract clauses,'' paragraph (a) is proposed to be revised to 
include the version of this paragraph that had been authorized via 
deviation. The deviation was issued to implement requirements of 
Homeland Security Presidential Directive (HSPD) 12 regarding personal 
identity verification and access to information systems.
    The title of part 2442 is proposed to be revised to read, 
``Contract Administration and Audit Services,'' to correspond to the 
title of part 42 of the FAR. In part 2442, a new subpart 2442.3, 
``Contract Administration Office Functions,'' would be added following 
FAR subpart 42.3. A new 2442.302-70, ``Contract clause,'' would be 
added to this subpart to prescribe the use of a new standard clause at 
2452.242-72, ``Post-award Orientation Conference,'' in solicitations 
and contracts when the contractor will be required to attend a post-
award orientation conference.
    In part 2452, ``Solicitation Provisions and Contract Clauses,'' 
under subpart 2452.2, ``Texts of Provisions and Clauses,'' 2452.204-70, 
``Preservation of, and access to, contract records (tangible and 
electronically stored information (ESI) formats),'' would be added to 
provide a standard contract clause that requires contractors to 
preserve, and upon the request of the contracting officer, provide to 
HUD any information generated or maintained under the contract that is 
related to matters concerning actual or anticipated litigation to which 
HUD is a party in accordance with the amendments to the Federal Rules 
of Civil Procedure concerning the discovery of electronically stored 
information.
    Section 2452.215-70, ``Proposal content,'' would be amended to add 
a new Alternate III when the contracting officer determines that it is 
necessary to limit the size of the technical and management portion of 
offers submitted under requests for proposals using the tradeoff source 
selection method. The contracting officer must insert the page limit in 
the provision's alternate.
    A new solicitation provision, 2452.215-71, ``Relative Importance of 
Technical Evaluation Factors to Cost or Price,'' would be added to 
provide a standard provision for use in solicitations using the 
tradeoff source selection method. The provision notifies offerors of 
the relative weight of the technical evaluation factors to cost or 
price when evaluating offers for contract award. The contracting 
officer selects the relative weighting to be used.
    A new solicitation provision in 2452.215-72, ``Evaluation of Small 
Business Participation,'' would be added to provide factors for use in 
evaluating proposed small business participation in offers for 
contracts requiring the use of FAR 52.219-9, Small Business 
Subcontracting Plan, to be awarded using the tradeoff source selection 
process.
    Section 2452.216-76, ``Minimum and Maximum Quantities or Amounts 
for Order,'' would be revised to remove the reference to definite-
quantity contracts, since the use of minimum and maximum quantities 
does not apply to those contracts and the tables, which had permitted 
inserting multiple minimums and maximums (e.g., for separate option 
periods), and remove the alternate. Instead, a single minimum and 
maximum would be inserted. In accordance with FAR 16.502, definite-
quantity contracts provide for delivery of a definite quantity of 
specific supplies or services for a fixed period, with deliveries or 
performance to be scheduled by the Government at designated locations 
upon order. The Government orders the entire quantity established in 
the contract. Therefore, the use of minimum and maximum quantities is 
not applicable to definite-quantity contracts.
    A new clause at 2452.216-79, ``Estimated Cost (No Fee),'' would be 
added to set forth the total estimated cost in cost-reimbursement type 
contracts that do not provide for any fee. The clause would also 
provide the level of funding if the contract is incrementally funded.
    A new clause at 2452.216-80, ``Estimated Cost and Fixed-Fee,'' 
would be added to set forth the total estimated cost and fixed-fee in 
cost-plus-fixed fee type contracts. The clause would also provide the 
level of funding and the pro-rated amount of fixed-fee if the contract 
is incrementally funded.
    New 2452.219-71, ``Notification of Competition Limited to Eligible 
8(a) Concerns--Alternate III to FAR 52.219-18,'' and 2452.219-72, 
``Section 8(a) direct awards (deviation),'' would be added to include 
clauses to implement HUD's Partnership Agreement with the SBA under 
which the SBA delegated to HUD's SPE its authority under paragraph 
8(a)(1)(A) of the Small Business Act (5 U.S.C. 637(a)) to enter into 
8(a) contracts, and its authority under 8(a)(1)(B) of the Small 
Business Act to award the performance of those contracts to eligible 
8(a) Program participants. Section 8(a) of the Small

[[Page 15686]]

Business Act (15 U.S.C. 637(a)) established a program that authorizes 
the SBA to enter into all types of contracts with other federal 
agencies and let subcontracts for performing those contracts go to 
firms eligible for participation in the 8(a) Program. The SBA's 
subcontractors are referred to as ``8(a) contractors.''
    A new 2452.219-73, ``Incorporation of Subcontracting Plan,'' would 
add a standard clause for use when incorporating an approved 
subcontracting plan into a contract by reference, to conform to HUD 
practice.
    A new 2452.219-74, ``Small Business Subcontracting Goals,'' is 
proposed. This section would add a provision for use in solicitations 
for contracts that are required to include the FAR clauses at 52.219-8, 
``Utilization of Small Business Concerns,'' and at 52.219-9, ``Small 
Business Subcontracting Plan.'' The provision provides offerors with 
the HUD's small business subcontracting goals.
    A new 2452.227-70, ``Government Information,'' would add a clause 
to provide direction to contractors on the maintenance and protection 
of Federal Government information provided to, or obtained by, them for 
the purpose of performing the contract. Such direction is intended to 
ensure the protection and retrieval of Government information, when 
needed.
    Sections 2452.232-70, ``Payment Schedule and Invoice Submission 
(Fixed-Price),'' and 2452.232-71, ``Voucher Submission (Cost-
Reimbursement),'' are proposed to be revised to require contractors to 
submit copies of all invoices and vouchers to the contracting officer. 
As currently written, the two clauses provide contracting officers with 
the option of requiring contractors to provide them with copies of 
invoices and vouchers for payment. The revisions will better ensure 
that contracting offices and files contain a complete invoicing 
history. In addition, to better ensure that the contract closeout 
process is properly and promptly initiated, 2452.232-70 and 2452.232-71 
are revised to require the contracting officer's certification of the 
final invoice or completion voucher before final payment may be made. 
Section 2452.232-71 would also be revised to require its use in time-
and-materials and labor-hour contracts and to require contractors to 
aggregate vouchered costs under such contracts by individual tasks or 
jobs. A new 2452.232-72, ``Limitation of Federal Government's 
obligation,'' would add a clause to limit the Federal Government's 
obligation under incrementally funded fixed-price contracts (see new 
subpart 2432.7). In such cases, the clause: Sets forth the authority 
and obligations of the Government and contractor regarding work under 
the incrementally funded line items of the contract; requires the 
contractor to notify the Government, within a period specified by the 
contracting officer, when work under such line items has incurred 85 
percent of the funds allotted to them; provides for termination of such 
line items if not fully funded; provides for an equitable adjustment in 
the contract price and/or performance schedule if the contractor incurs 
additional costs or is delayed in the performance of the work solely by 
reason of the failure of the Government to allot additional funds in 
amounts sufficient for timely performance of the incrementally funded 
line items; and permits the Government to allot additional funds for 
the performance of the incrementally funded line items at any time 
prior to termination.
    A new 2452.232-73, ``Constructive acceptance period,'' would add a 
clause to provide for an acceptance period longer than the 7 days 
provided for in FAR 52.232-25, ``Prompt Payment,'' when the contracting 
officer determines that a longer period is necessary.
    Section 2452.237-72, ``Coordination of data collection 
activities,'' would be redesignated as 2452.201-70. The clause and its 
prescription are more appropriately located in HUDAR subpart 2401.1.
    In 2452.237-73, ``Conduct of work and technical guidance,'' the 
introductory sentence would be revised to correct the prescription 
citation and to remove the name of the Government Technical 
Representative (GTR) from the clause. The contracting officer will 
provide the name and contact information for the GTR to the contractor 
separately.
    Section 2452.237-75, ``Clearance of contractor personnel,'' would 
be revised to formally incorporate the version of the clause entitled, 
``Access to HUD Facilities,'' which had been authorized via deviation, 
into the HUDAR. The clause has been revised to implement the personal 
identity verification and other requirements of Homeland Security 
Presidential Directive (HSPD) 12, as described in the clause.
    Section 2452.237-77, ``Observance of Legal Holidays and 
Administrative Leave,'' is revised to correct the prescription citation 
and revise the clause title to read, ``Temporary Closure of HUD 
Facilities,'' which more accurately reflects its contents and purpose; 
namely, providing direction to contractors regarding their access to 
HUD facilities during temporary closures of the facilities (e.g., for 
holidays).
    Section 2452.239-70, ``Background investigations for sensitive 
automated systems/applications,'' would be revised to formally 
incorporate the version of the clause entitled ``Access to HUD 
Systems,'' which had been authorized via deviation, in the HUDAR. The 
clause implements the personal identity verification and other 
requirements of Homeland Security Presidential Directive (HSPD) 12, as 
described in the clause. Also, definitions are added in a new paragraph 
(a).

III. Findings and Certifications

Paperwork Reduction Act Statement

    The information collection requirements contained in this proposed 
rule are currently approved by the Office of Management and Budget 
(OMB) in accordance with the Paperwork Reduction Act of 1995 (44 U.S.C. 
3501-3520) and assigned OMB control number 2535-0091. The information 
collection requirements for the HUDAR are currently approved by OMB 
under control number 2535-0091. In accordance with the Paperwork 
Reduction Act, an agency may not conduct or sponsor, and a person is 
not required to respond to, a collection of information, unless the 
collection displays a currently valid OMB control number.

Unfunded Mandates Reform Act

    Title II of the Unfunded Mandates Reform Act of 1995 (2 U.S.C. 
1531-1538) (UMRA) establishes requirements for federal agencies to 
assess the effects of their regulatory actions on state, local, and 
tribal governments and the private sector. This rule does not impose 
any federal mandate on any state, local, or tribal government or the 
private sector within the meaning of UMRA.

Regulatory Flexibility Act

    The Regulatory Flexibility Act (RFA) (5 U.S.C. 601 et seq.) 
generally requires an agency to conduct a regulatory flexibility 
analysis of any rule subject to notice and comment rulemaking 
requirements, unless the agency certifies that the rule will not have a 
significant economic impact on a substantial number of small entities. 
This proposed rule makes technical changes to existing contracting 
procedures and does not make any major changes that would significantly 
impact businesses. Accordingly, the undersigned certifies that this 
rule will not have a significant economic impact on a substantial 
number of small entities.

[[Page 15687]]

Notwithstanding HUD's determination that this rule will not have a 
significant economic impact on a substantial number of small entities, 
HUD specifically invites comments regarding less burdensome 
alternatives to this rule that will meet HUD's objectives as described 
in this preamble.

Environmental Impact

    This proposed rule does not direct, provide for assistance or loan 
and mortgage insurance for, or otherwise govern or regulate real 
property acquisition, disposition, leasing, rehabilitation, alteration, 
demolition, or new construction, or establish, revise, or provide for 
standards for construction or construction materials, manufactured 
housing, or occupancy. Accordingly, under 24 CFR 50.19(c)(1), this 
proposed rule is categorically excluded from environmental review under 
the National Environmental Policy Act of 1969 (42 U.S.C. 4321).

Executive Order 13132, Federalism

    Executive Order 13132 (entitled ``Federalism'') prohibits an agency 
from publishing any rule that has federalism implications if the rule 
imposes substantial direct compliance costs on state and local 
governments and is not required by statute, or the rule preempts state 
law, unless the agency meets the consultation and funding requirements 
of section 6 of the Executive Order. This proposed rule would not have 
federalism implications and would not impose substantial direct 
compliance costs on state and local governments or preempt state law 
within the meaning of the Executive Order.

List of Subjects

48 CFR Part 2401

    Government procurement, Reporting and recordkeeping requirements.

48 CFR Part 2402

    Government procurement.

48 CFR Part 2403

    Conflict of interests, Government procurement.

48 CFR Part 2404

    Government procurement.

48 CFR Parts 2406-2409

    Government procurement.

48 CFR Parts 2415-2417

    Government procurement.

48 CFR Part 2419

    Government procurement, Small business.

48 CFR Part 2426

    Colleges and universities, Government procurement, Minority 
businesses.

48 CFR Part 2427

    Government procurement, Inventions and patents.

48 CFR Part 2428

    Government procurement, Surety bonds.

48 CFR Part 2432

    Government procurement.

48 CFR Part 2437

    Government procurement.

48 CFR Part 2439

    Computer technology, Government procurement.

48 CFR Part 2442

    Government procurement.

48 CFR Part 2452

    Government procurement.

    For the reasons discussed in the preamble, HUD proposes to amend 48 
CFR chapter 24 as follows:

PART 2401--FEDERAL ACQUISITION REGULATION SYSTEM

    1. The authority citation for part 2401 continues to read as 
follows:

    Authority: 40 U.S.C. 121(c); 42 U.S.C. 3535(d).

Subpart 2401.1--Purpose, Authority, Issuance

    2. Add 2401.106-70 to read as follows:


2401.106-70  Contract clause.

    The contracting officer shall insert the clause at 2452.201-70, 
Coordination of Data Collection Activities, in solicitations and 
contracts where the Contractor is required to collect information from 
ten or more public respondents.

Subpart 2401.4--Deviations From the FAR

    3. Revise 2401.403 to read as follows:


2401.403  Individual deviations.

    The Senior Procurement Executive is the agency head's designee for 
the purposes of FAR 1.403.
    4. Revise 2401.404 to read as follows:


2401.404  Class deviations.

    (a) The Senior Procurement Executive is the agency head's designee 
for the purposes of FAR 1.404(a).
    5. Add 2401.470 to read as follows:


2401.470  Deviations from the HUDAR.

    The Senior Procurement Executive is authorized to approve 
deviations from the HUDAR.
    6. Add 2401.471 to read as follows:


2401.471  Requests for deviations--FAR and HUDAR.

    (a) Requests for deviations from the FAR or HUDAR shall be 
submitted in writing to the Chief Procurement Officer.
    (b) Each request for authorization of a deviation from the FAR or 
HUDAR shall:
    (1) Identify the deviation as individual or class;
    (2) Identify the FAR or the HUDAR requirement from which a 
deviation is sought;
    (3) Fully describe the deviation, its intended effect, and the 
circumstances in which it will be used;
    (4) Explain why a deviation is required and include pertinent 
background and supporting information;
    (5) State whether the deviation has been requested previously and 
if so, the circumstances and result of the previous request; and
    (6) Identify the contractor(s) and the contract(s) (including 
dollar values) that would be affected.
    (c) At his or her discretion, the Chief Procurement Officer will 
consider requests for deviations on an expedited basis and, in urgent 
situations, may authorize deviations via telephone or electronic mail. 
Such authorizations will be confirmed in writing.
    (d) The contracting officer shall include a copy of each authorized 
deviation in the contract file(s) to which it pertains.

Subpart 2401.6--Career Development, Contracting Authority and 
Responsibilities

    7. In 2401.602-3:
    a. Revise paragraphs (b)(1) and (3); and
    b. Remove paragraph (c)(7).
    The revision reads as follows:


2401.602-3  Ratification of unauthorized commitments.

    (b)(1) Requests for ratification of unauthorized commitments shall 
be submitted in writing through the contracting officer to the 
ratification approval officials identified in paragraph (b)(3) of this 
section. The Assistant Secretary or equivalent official for the office 
that created the unauthorized commitment shall sign the request for 
ratification.
* * * * *
    (3) In accordance with FAR 1.602-3(b)(3), the Senior Procurement

[[Page 15688]]

Executive may delegate the authority to approve ratifications of 
individual unauthorized commitments down to, but not below, the level 
of an Assistant Chief Procurement Officer.
* * * * *

PART 2402--DEFINITIONS OF WORDS AND TERMS

    8. The authority citation for part 2402 continues to read as 
follows:

    Authority: 40 U.S.C. 121(c); 42 U.S.C. 3535(d).

Subpart 2402.1--Definitions

    9. In 2402.101, add in alphabetical order a definition of 
``Contracting Activity,'' and revise the definitions of ``Head of the 
Contracting Activity'' and ``Legal Counsel'' to read as follows:


2402.101  Definitions.

* * * * *
    Contracting activity means the Office of the Chief Procurement 
Officer.
* * * * *
    Head of the contracting activity (HCA) means the Chief Procurement 
Officer. As permitted by the FAR and the HUD Acquisition Regulation, 
the Chief Procurement Officer, acting within his or her authority as 
the Senior Procurement Executive, may delegate HCA authority for 
specific actions or classes of actions down to, but not below, the 
level of the Assistant Chief Procurement Officers. Delegated HCA 
authority may not be further redelegated.
    Legal counsel means HUD's Office of General Counsel and its field-
based components.
* * * * *

PART 2403--IMPROPER BUSINESS PRACTICES AND PERSONAL CONFLICTS OF 
INTEREST

    10. The authority citation for part 2403 continues to read as 
follows:

    Authority: 42 U.S.C. 3535(d).

Subpart 2403.4--Contingent Fees

    11. Revise 2403.405(b) to read as follows:


2403.405  Misrepresentations or violations of the covenant against 
contingent fees.

* * * * *
    (b) When there is specific evidence or other reasonable basis to 
suspect one or more of the violations in paragraph (a) of this section, 
the HCA shall review the facts and, if appropriate, take or direct one 
or more of the actions set forth at FAR 3.405(b). The HCA shall refer 
suspected fraudulent or criminal matters to HUD's Office of the 
Inspector General for possible referral to the Department of Justice.

PART 2404--ADMINISTRATIVE MATTERS

    12. The authority citation for part 2404 continues to read as 
follows:

    Authority:  42 U.S.C. 3535(d).

    13. Add subpart 2404.7 to read as follows:

Subpart 2404.7--Contractor Records Retention

Sec.
2404.7001 Contract clause


2404.7001  Contract clause.

    The contracting officer shall insert the clause at 2452.204-72, 
Preservation of, and Access to, Contract Records (Tangible and 
Electronically Stored Information (ESI) Formats), in all solicitations 
and contracts exceeding the simplified acquisition threshold. The 
contracting officer shall use the basic clause with its Alternate I in 
cost-reimbursement type contracts. The contracting officer shall use 
the basic clause with its Alternate II in labor-hour and time-and-
materials contracts.

PART 2406--COMPETITION REQUIREMENTS

    14. The authority citation for part 2406 continues to read as 
follows:

    Authority: 40 U.S.C. 121(c); 41 U.S.C. 253; 42 U.S.C. 3535(d).

Subpart 2406.3--Other Than Full and Open Competition

    15. Add 2406.302-2 to read as follows:


2406.302-2  Unusual and compelling urgency.

    (d)(1)(ii) The HCA is the agency head's designee for the purposes 
of FAR 6.302-2(d)(1)(ii).


2406.304-70  [Removed]

    16. Remove 2406.304-70.

Subpart 2406.5--Competition Advocates

    17. Revise 2406.501 to read as follows:


2406.501  Requirement.

    The Senior Procurement Executive is the head of the agency for the 
purposes of FAR 6.501 and designates the Departmental competition 
advocate.

PART 2407--ACQUISITION PLANNING

    18. The authority citation for part 2404 continues to read as 
follows:

    Authority: 42 U.S.C. 3535(d).

Subpart 2407.1--Acquisition Plans

    19. Revise 2407.102 to read as follows:


2407.102   Policy.

    The Senior Procurement Executive is responsible for establishing 
and maintaining internal procedures that meet the criteria contained in 
FAR subpart 7.1 for acquisition planning and acquisition plan content.

PART 2409--CONTRACTOR QUALIFICATIONS

    20. The authority citation for part 2409 continues to read as 
follows:

    Authority: 40 U.S.C. 121(c); 42 U.S.C. 3535(d).

    21. Add subpart 2409.4 to read as follows:

Subpart 2409.4--Debarment, Suspension, and Ineligibility

Sec.
2409.405 Effect of listing.
2409.407-1 General.
2409.470 HUD regulations on debarment, suspension, and 
ineligibility.
2409.405 Effect of listing.
    (3) The Senior Procurement Executive is the agency head's designee 
under FAR 9.405(d)(3).


2409.407-1  General.

    (d) The Senior Procurement Executive is the agency head's designee 
under FAR 9.407-1(d).


2409.470  HUD regulations on debarment, suspension, and ineligibility.

    HUD's policies and procedures concerning debarment and suspension 
are contained in 2 CFR part 2424.

Subpart 2409.5--Organizational and Consultant Conflicts of Interest

    22. Add 2409.503 to read as follows:


2409.503   Waiver.

    The Senior Procurement executive is the agency head's designee 
under FAR 9.503.

Subpart 2409.70--[Amended]

    23. Remove subpart 2409.70.

PART 2415--CONTRACTING BY NEGOTIATION

    24. The authority citation for part 2415 continues to read as 
follows:

    Authority: 40 U.S.C. 121(c); 41 U.S.C. 253; 42 U.S.C. 3535(d).

[[Page 15689]]

Subpart 2415.2--Solicitation and Receipt of Proposals and 
Quotations

    25. Revise the heading for subpart 2415.2 to read as set forth 
above.
    26. Add 2415.203 to read as follows:


2415.203  Requests for proposals.

    (a)(3) The contracting officer may limit the size of the technical 
and management portion of offers submitted in response to a request for 
proposals when the contracting officer determines that it is in the 
Government's best interest to do so.
    27. Revise 2415.204 to read as follows:


2415.204   Contract format.

    (e) The HCA shall be responsible for making exemptions pursuant to 
FAR 15.204(e).
    28. Revise 2415.209 to read as follows:


2415.209   Solicitation provisions and contract clauses.

    (a)(1) The Contracting Officer shall insert a provision 
substantially the same as the provision at 2452.215-70, Proposal 
Content, in all solicitations for negotiated procurements using the 
tradeoff selection process (see FAR 15.101-1) expected to exceed the 
simplified acquisition limit. The Contracting Officer shall adapt 
paragraph (c) of the provision (i.e., include, delete, revise, or 
further supplement subparagraphs) to address the particular 
requirements of the immediate solicitation. The provision may be used 
in simplified acquisitions when it is necessary to obtain technical and 
management information in making the award selection. When award 
selection will be made through the lowest-priced technically acceptable 
source selection process, the provision shall be used with its 
Alternate I. If the proposed contract requires work on, or access to, 
HUD systems or applications (see the clause at 2452.239-70), the 
provision shall be used with its Alternate II. When the contracting 
officer has determined that it is necessary to limit the size of the 
technical and management portion of offers submitted by offerors, the 
provision shall be used with its Alternate III. The contracting officer 
shall clearly identify in the provision any contents of the technical 
and management portion of offers that are excluded from the size 
limitation (e.g., proposed contractor staff resumes).
    (2) The contracting officer shall insert the provision at 2452.215-
71, Relative Importance of Technical Evaluation Factors to Cost or 
Price, in solicitations for contracts to be awarded using the tradeoff 
selection process (see FAR 15.101-1) expected to exceed the simplified 
acquisition limit.

Subpart 2415.3--Source Selection

    29. Revise 2415.303 to read as follows:


2415.303   Responsibilities.

    (a) The Senior Procurement Executive is the agency head for the 
purposes of FAR 15.303(a).
    (b)(1) The technical evaluation requirements related to source 
selection shall be performed by a Technical Evaluation Panel (TEP). The 
TEP may consist of any number of members as appropriate to the 
acquisition, with one member serving as the chairperson. As needed, the 
TEP may include advisors and committees to focus on specific technical 
areas or concerns. The TEP is responsible for fully documenting the 
evaluation of all proposals as appropriate to the source selection 
approach in use and for making the source selection recommendation to 
the source selection authority.
    30. Revise 2415.304 to read as follows:


2415.304   Evaluation factors and significant subfactors.

    (c)(3)(i) The extent of participation of small businesses in 
performance of the contract, whether as a joint venture, teaming 
arrangement, or subcontractor, shall be addressed in the source 
selection for contracts to be awarded using the tradeoff source 
selection process (see FAR 15.101-1) that require the use of the clause 
at FAR 52.219-9, Small Business Subcontracting Plan.
    (d) The solicitation shall state the basis for the source selection 
decision as either the ``lowest price technically acceptable'' (LPTA) 
process or the ``tradeoff'' process (as defined at FAR subpart 15.1).
    31. Revise 2415.305(a)(3) to read as follows:


2415.305   Proposal evaluation.

    (a) * * *
    (3) Technical evaluation. The TEP shall rate each proposal based on 
the evaluation factors specified in the solicitation. The TEP shall 
identify each proposal as being acceptable, unacceptable but capable of 
being made acceptable, or unacceptable. A proposal shall be considered 
unacceptable if it is so clearly deficient that it cannot be corrected 
through written or oral discussions. Under the tradeoff process, 
predetermined threshold levels of technical acceptability for proposals 
shall not be employed. A technical evaluation report, which complies 
with FAR 15.305(a)(3), shall be prepared and signed by the technical 
evaluators, furnished to the contracting officer, and maintained as a 
permanent record in the official procurement file.
    32. Add 2415.370 to read as follows:


2415.370   Solicitation provision.

    The contracting officer shall insert the provision at 2452.215-72, 
Evaluation of Small Business Participation, in solicitations for 
contracts that require the use of the FAR clause in 52.219-9, ``Small 
Business Subcontracting Plan,'' that will be awarded using the tradeoff 
source selection process (see FAR 15.101-1).

PART 2416--TYPES OF CONTRACTS

    33. The authority citation for part 2416 is revised to read as 
follows:

    Authority: 40 U.S.C. 121(c); 41 U.S.C. 253; 42 U.S.C. 3535(d).

    34. Add subpart 2416.3 to read as follows:

Subpart 2416.3--Cost-Reimbursement Contracts

Sec.
2416.307 Contract clauses.


2416.307   Contract clauses.

    (a) The contracting officer shall insert the clause at 2452.216-79, 
Estimated Cost (No Fee), in all cost-reimbursement (no fee) type 
solicitations and contracts.
    (b) The contracting officer shall insert the clause at 2452.216-80, 
Estimated Cost and Fixed-Fee, in all cost-plus-fixed fee type 
solicitations and contracts.

Subpart 2416.5--Indefinite-Delivery Contracts

    35. Revise 2416.505 to read as follows:


2416.505   Ordering.

    (a) The contracting officer shall be the ordering official for all 
task orders except as provided for herein. The contracting officer may 
designate an ordering official when orders are to be placed on a firm 
fixed-price basis, the prices of the specific services or supplies to 
be provided under the order are set forth in the contract, and there is 
no negotiation of order terms. The contracting officer shall not 
designate ordering officials:
    (1) For contracts for services where prices are not tied to 
delivery of a completed service;
    (2) For any contracts where discounts need to be negotiated; or
    (3) In any other circumstances where adjustment of contract price 
or any other terms and conditions is necessary.

[[Page 15690]]

    (b)(6) The Departmental competition advocate also serves as the 
Departmental task and delivery order ombudsman in accordance with FAR 
16.505(b)(6). In addition to the duties set forth at FAR 16.505(b)(6), 
the ombudsman shall recommend any corrective action regarding affording 
fair opportunity to contractors to compete for orders to the 
responsible contracting officer.
    36. In 2416.506-70, revise paragraph (b) to read as follows:


2416.506-70   Solicitation provisions and contract clauses.

* * * * *
    (b) Minimum and maximum quantities or amounts for order. The 
contracting officer shall insert a clause substantially the same as 
2452.216-76, Minimum and Maximum Quantities or Amounts for Order, in 
all indefinite-quantity and requirements solicitations and contracts. 
When the clause is used for requirements solicitations and contracts, 
the contracting officer may either delete paragraph (a) or insert 
``none'' for the minimum quantity or amount.
* * * * *

PART 2417--SPECIAL CONTRACTING METHODS

    37. The authority citation for part 2417 continues to read as 
follows:

    Authority: 31 U.S.C. 1535; 40 U.S.C. 121(c); 42 U.S.C. 3535(d).

Subpart 2417.2--Options

    38. Revise section 2417.204 to read as follows:


2417.204  Contracts.

    (e)(1) The Senior Procurement Executive (SPE) is authorized to 
approve contract periods for other than information technology 
contracts that exceed the 5-year limit set forth at FAR 17.204(e) that 
are not otherwise limited by statute (e.g., the Service Contract Act). 
Except as provided for in paragraphs (e)(2) and (4) herein, the SPE 
shall approve any contract period that will exceed 5 years, including 
all option periods, prior to the award of the basic contract.
    (2) With regard to HUD indefinite-delivery contracts, the 
``contract period'' requiring the SPE's prior approval in paragraph 
(e)(1) shall mean the ordering period of a contract. Unless otherwise 
specified within the contract, the 5-year limit shall not apply to the 
period that any task or delivery order issued within the contract's 
ordering period extends beyond the final end date of the contract's 
ordering period, regardless of whether the performance period of the 
order causes the total period of the contract to exceed 5 years. The 
issuance of any such task or delivery order does not require the SPE's 
approval. Task or delivery orders with end dates extending beyond the 
ordering period of the contract may not exceed the final delivery date 
that the contracting officer has stated in the applicable indefinite-
delivery FAR clause included in the contract (i.e., 52.216-20, 
``Definite Quantity,'' paragraph (d); 52.216-21, ``Requirements,'' 
paragraph (f); or 52.216-22, ``Indefinite Quantity,'' paragraph (d)).
    (3) The SPE's authority described in paragraphs (e)(1) and (2) 
shall not be used as the basis to retroactively increase or extend the 
period of any existing contract.
    (4) The SPE is not required to approve any option properly 
exercised pursuant to the FAR clause at 52.217-8, ``Option to Extend 
Services,'' that extends the contract period beyond 5 years; provided 
that the total length of all options exercised pursuant to FAR clause 
52.217-8 may not exceed 6 months; and provided that exercise of any 
such options shall be in accordance with FAR 37.111. Any proposed 
extension of a contract beyond the 6-month maximum permitted by FAR 
52.217-8 shall be considered a new requirement and shall be subject to 
the competition requirements of FAR part 6.

PART 2419--SMALL BUSINESS PROGRAMS

    39. The authority citation for part 2419 continues to read as 
follows:

    Authority: 40 U.S.C. 121(c); 42 U.S.C. 3535(d).

Subpart 2419.2--Policies

    40. In 2419.201, redesignate paragraphs (c) and (d) as paragraphs 
(d) and (e), respectively, and revise newly designated paragraph 
(e)(1), to read as follows:


2419.201   General policy.

    (d) The Director of HUD's Office of Small and Disadvantaged 
Business Utilization (OSDBU) is responsible for the administration of 
the HUD small business program and for performing all functions and 
duties prescribed in FAR 19.201(d). This includes Department-wide 
responsibility for developing, implementing, executing, and managing 
these programs; providing advice on these programs; and representing 
HUD before other government agencies on matters primarily affecting 
small, small disadvantaged, and women-owned small business; HUBZone 
small business; veteran-owned small business; and service-disabled 
veteran-owned small business concerns.
    (e) The Director of OSDBU shall designate small business 
specialists who shall advise and assist HUD's contracting activity and 
small business concerns as described in paragraph (d) on all matters 
related to small business participation in HUD acquisitions. Small 
business specialists shall perform the following functions:
    (1) Maintain a program designed to locate capable small-business 
sources as referenced in 2419.201(d) for current and future 
procurements;
* * * * *

Subpart 2419.5--Set-Asides for Small Business


2419.503   [Removed and Reserved]

    41. Remove and reserve 2419.503.

Subpart 2419.7--The Small Business Subcontracting Program

    42. Revise 2419.708 to read as follows:


2419.708   Solicitation provisions and contract clauses.

    (b) The contracting officer shall insert clause at 2452-219-73, 
Incorporation of Subcontracting Plan, in solicitations and contracts 
when a subcontracting plan is required. The contracting officer shall 
insert the provision at 2452.219-74, Small Business Subcontracting 
Goals, in solicitations for contracts that are required to include the 
FAR clauses at 52.219-8, ``Utilization of Small Business Concerns,'' 
and 52.219-9, ``Small Business Subcontracting Plan.''
    (d) The contracting officer shall insert the provision at 2452.219-
70, Small Business Subcontracting Plan Compliance, in solicitations for 
contracts that are expected to exceed the dollar thresholds set forth 
at FAR 19.702 and are required to include the clause at FAR 52.219-9, 
Small Business Subcontracting Plan.

Subpart 2419.8--Contracting With the Small Business Administration 
(the 8(a) Program)

    43. Revise 2419.800 to read as follows:


2419.800   General.

    (f) By Partnership Agreement between the SBA and HUD, the SBA 
delegated to HUD's Senior Procurement Executive its authority under 
paragraph 8(a)(1)(A) of the Small Business Act (5 U.S.C. 637(a)) to 
enter into 8(a) prime contracts, and its authority under 8(a)(1)(B) of 
the Small Business Act to award the performance of those contracts to

[[Page 15691]]

eligible 8(a) Program participants. Under the Partnership Agreement, a 
contract may be awarded directly to an 8(a) firm on either a sole-
source or competitive basis. The SBA reserves the right to withdraw the 
delegation issued as a result of the Partnership Agreement; however, 
any such withdrawal shall have no effect on contracts already awarded 
under the Partnership Agreement.
    44. Add 2419.803 to read as follows:


2419.803   Selecting acquisitions for the 8(a) Program.

    45. Add 2419.803-70 to read as follows:


2419.803-70   Procedures for simplified acquisitions under the 
partnership agreement.

    (a) HUD contracting officers may use the procedures of FAR part 13 
and HUDAR part 2413 to make purchases not exceeding the simplified 
acquisition threshold from 8(a) Participants. The following apply to 
such acquisitions:
    (1) Neither offering letters to, nor acceptance letters from the 
SBA are required.
    (2) The contracting officer will use the Central Contractor 
Registration (CCR) database on the Internet (http://www.ccr.gov) to 
establish that the selected 8(a) firm is a current program participant.
    (b) Once an 8(a) contractor has been identified, the contracting 
officer will establish the price with the selected 8(a) contractor.
    (c) For acquisitions requiring an award document (e.g., purchase 
order), the contracting officer will:
    (1) Prepare and issue an award document in accordance with the 
applicable provisions of FAR part 13 and HUDAR part 2413. The 
applicable clauses prescribed in 2419.811-3 shall be included in the 
award document. The contracting officer will issue the award document 
directly to the 8(a) firm; and
    (2) Forward to the SBA District Office serving the 8(a) firm a copy 
of the award document within 5 days after the award is issued.
    46. Add 2419.804 to read as follows:


2419.804  Evaluation, offering, and acceptance.

    47. Add 2419.804-2 to read as follows:


2419.804-2   Agency offering.

    (d) When applicable, the notification must identify that the 
offering is in accordance with the Partnership Agreement identified in 
2419.800.
    48. Add 2419.804-3 to read as follows:


2419.804-3   SBA acceptance.

    49. Add 2419.804-370 to read as follows:


2419.804-370   SBA acceptance under partnership agreements for 
acquisitions exceeding the simplified acquisition threshold.

    (a) The following procedures apply to the acceptance of 
requirements covered by the Partnership Agreement for acquisitions that 
exceed the simplified acquisition threshold.
    (1) The SBA's decision whether to accept the requirement will be 
transmitted to HUD in writing within 5 working days of receipt of the 
offer.
    (2) The SBA may request, and HUD may grant, an extension beyond the 
5-day limit.
    (3) SBA's acceptance letters should be faxed or emailed to HUD.
    (4) If HUD has not received an acceptance or rejection of the 
offering from SBA within 5 days of SBA's receipt of the offering 
letter, the contracting officer may assume that the requirement has 
been accepted and proceed with the acquisition.
    (b) The contents of SBA's acceptance letter shall be limited to the 
eligibility of the recommended 8(a) contractor.
    50. Add 2419.805 to read as follows:


2419.805   Competitive 8(a).

    51. Add 2419.805-2 to read as follows:


2419.805-2   Procedures.

    (b)(3) For requirements exceeding the simplified acquisition 
threshold that are processed under the Partnership Agreement cited in 
2419.800, the contracting officer shall submit the name, address, and 
telephone number of the low bidder (sealed bid requirements) or the 
apparent successful offeror (negotiated acquisitions) to the SBA 
Business Opportunity Specialist at the field office servicing the 
identified 8(a) firm. The SBA will determine the eligibility of the 
firm(s) and advise the contracting officer within 2 working days of the 
receipt of the request. If the firm is determined to be ineligible, the 
contracting officer will submit information on the next low offeror or 
next apparent successful offeror (as applicable) to the cognizant SBA 
field office.
    52. Add 2419.806 to read as follows:


2419.806   Pricing the 8(a) contract.

    (a) For contracts awarded under the Partnership Agreement cited in 
2419.800, when required by FAR subpart 15.4, the contracting officer 
shall obtain certified cost or pricing data directly from the 8(a) 
contractor.
    53. Add 2419.808 to read as follows:


2419.808   Contract negotiation.

    54. Add 2419.808-1 to read as follows:


2419.808-1   Sole source.

    (a) If the acquisition is conducted under the Partnership Agreement 
cited in 2419.800, the 8(a) contractor is responsible for negotiating 
with HUD within the time frame established by the contracting officer. 
If the 8(a) contractor does not negotiate within the established time 
frame, and HUD cannot allow additional time, HUD, after notification 
and approval by SBA, may proceed with the acquisition from other 
sources.
    (b) If the acquisition is conducted under the Partnership Agreement 
cited in 2419.800, HUD is delegated the authority to negotiate directly 
with the 8(a) participant; however, if requested by the 8(a) 
participant, the SBA may participate in negotiations.
    55. Add 2419.811 to read as follows:


2419.811   Preparing the contracts.

    56. Add 2419.811-1 to read as follows:


2419.811-1   Sole source.

    (e) If the award is to be made under the Partnership Agreement 
cited in 2419.800, the contracting officer shall prepare the instrument 
to be awarded to the 8(a) firm in accordance with the normal HUD 
procedures for non-8(a) contracts, except for the following:
    (1) The award form shall cite 41 U.S.C. 253(c)(5) and 15 U.S.C. 
637(a) as the authority for use of other than full and open 
competition.
    (2) The contracting officer shall include appropriate contract 
clauses, as necessary, to reflect that the acquisition is an 8(a) 
contract awarded under the authority of the Partnership Agreement cited 
in 2419.800.
    (3) The contracting officer shall include SBA's requirement number 
on the contract unless the acquisition does not exceed the simplified 
acquisition threshold.
    (4) A single award document shall be used between HUD and the 8(a) 
contractor. As such, no signature on the part of the SBA is required; a 
single signature by the HUD contracting officer shall suffice. The 8(a) 
contractor's signature shall be placed on the award document as the 
prime contractor. The 8(a) contractor's name and address shall be 
placed in the ``awarded to'' or ``contractor name'' block on the 
appropriate forms.
    57. Add 2419.811-2 to read as follows:

[[Page 15692]]

2419.811-2   Competitive.

    (a) If the award is to be made under the Partnership Agreement 
cited in 2419.800, competitive contracts for 8(a) firms shall be 
prepared in accordance with the same standards as 8(a) sole-source 
contracts as set forth in 2419.811-1.
    (b) If the acquisition is conducted under the Partnership Agreement 
cited in 2419.800, the process for obtaining signatures shall be as 
specified in 2419.811-1(e).
    58. Add 2419.811-3 to read as follows:


2419.811-3   Contract clauses.

    (d)(3) The contracting officer shall use the clause at FAR 52.219-
18, ``Notification of Competition Limited to Eligible 8(a) Concerns,'' 
with the clause at 2452.219-71, ``Notification of Competition Limited 
to Eligible 8(a) Concerns--Alternate III to FAR 52.219-18,'' for 
competitive 8(a) acquisitions processed under the Partnership Agreement 
cited in 2419.800.
    (f) In contracts and purchase orders awarded under the Partnership 
Agreement cited at 2419.800, the contracting officer shall substitute 
the clause at 2452.219-72, Section 8(a) Direct Award, for the clauses 
at FAR 52.219-11, ``Special 8(a) Contract Conditions;'' FAR 52.219-12, 
``Special 8(a) Subcontract Conditions;'' and FAR 52.219-17, ``Section 
8(a) Award.''
    59. Add 2419.812 to read as follows:


2419.812   Contract administration.

    (e) Awards under the Partnership Agreement cited in 2419.800 are 
subject to 15 U.S.C. 637(a)(21). These contracts contain the clause at 
2452.219-71, Section 8(a) Direct Award (Deviation), which requires the 
8(a) contractor to notify the SBA and the HUD contracting officer when 
ownership of the firm is being transferred.

PART 2426--OTHER SOCIOECONOMIC PROGRAMS

    60. The authority citation for part 2426 is revised to read as 
follows:

    Authority: 40 U.S.C. 121(c); 42 U.S.C. 3535(d).

Subpart 2426.70--Minority Business Enterprises


2426.7001   [Removed and Reserved]

    61. Remove and reserve 2426.7001.


2426.7002   [Removed and Reserved]

    62. Remove and reserve 2426.7002.

PART 2427--PATENTS, DATA, AND COPYRIGHTS

    63. The authority citation for part 2427 is revised to read as 
follows:

    Authority: 40 U.S.C. 121(c); 42 U.S.C. 3535(d).

Subpart 2427.3--Patent Rights Under Government Contracts

    64. Revise the section heading of 2427.305-2 to read as follows:


2427.305-2  Administration by the Government.

* * * * *
    65. Add subpart 2427.4 to read as follows:

Subpart 2427.4--Rights in Data and Copyrights

Sec.
2427.470 Contract clause.


2427.470  Contract clause.

    The contracting officer shall insert the clause 2452.227-70, 
Government Information, in all solicitations and contracts when the 
Government will provide information to the contractor, and/or when the 
contractor will obtain information on the Government's behalf to 
perform work required under the contract. The contracting officer shall 
describe all information to be provided to the contractor in paragraph 
(d)(1) of the clause.

PART 2428--BONDS AND INSURANCE

    66. The authority citation for part 2428 is revised to read as 
follows:

    Authority: 40 U.S.C. 121(c); 42 U.S.C. 3535(d).

Subpart 2428.1--Bonds

    67. Revise the section heading of section 2428.106 to read as 
follows:


2428.106  Administration.

* * * * *

PART 2432--CONTRACT FINANCING

    68. The authority citation for part 2432 is revised to read as 
follows:

    Authority: 31 U.S.C. 3901-3905; 40 U.S.C. 121(c); 42 U.S.C. 
3535(d).

    69. Add 2432.006 to read as follows:


2432.006  Reduction or suspension of contract payments upon finding of 
fraud.

    70. Add 2432.006-1 to read as follows:


2432.006-1  General.

    The Senior Procurement Executive is the agency head for the 
purposes of FAR 32.006-1. In accordance with FAR 32.006-1(c), the 
Senior Procurement Executive may delegate the remedy coordination 
official duties to personnel in the Office of the Chief Procurement 
Officer at or above the Level IV of the Executive Service.
    71. Add 2432.006-2 to read as follows:


2432.006-2  Definitions.

    ``Remedy coordination official'' means the Senior Procurement 
Executive.
    72. Add 2432.006-3 to read as follows:


2432.006-3  Responsibilities.

    (b) HUD personnel shall report immediately in writing when a 
contractor's request for advance, partial, or progress payments is 
suspected to be fraudulent. The report shall be made to the contracting 
officer and the remedy coordination official. The report shall describe 
the events, acts, and conditions that indicate the apparent or 
suspected violation and include all pertinent documents. The remedy 
coordination official will consult with, and refer cases to, the Office 
of the Inspector General for investigation, as appropriate. If 
appropriate, the Office of the Inspector General will provide a report 
to the Senior Procurement Executive.
    73. Add 2432.006-4 to read as follows:


2432.006-4  Procedures.

    The Senior Procurement Executive is the agency head for the 
purposes of FAR 32.006-4.
    74. Add 2432.007 to read as follows:


2432.007  Contract financing payments.

    (a) The Senior Procurement Executive is the agency head for the 
purposes of FAR 32.007(a).

Subpart 2432.7--Contract Funding

    75. Add 2432.703-1 to read as follows:


2432.703-1  General.

    (b)(1) Except as described herein, a fixed-price contract may be 
funded incrementally only if--
    (i) Sufficient funds are not available to the Department at the 
time of contract award or exercise of option to fully fund the contract 
or option;
    (ii) The contract (excluding any options) or any exercised option--
    (A) Is for severable services;
    (B) Does not exceed one year in length; and
    (C) Is incrementally funded using funds available (unexpired) as of 
the date the funds are obligated; or

[[Page 15693]]

    (iii) The contract uses funds available from multiple (2 or more) 
fiscal years and Congress has otherwise authorized incremental funding.
    (2) An incrementally funded fixed-price contract shall be fully 
funded as soon as funds are available.
    76. Add 2432.704 to read as follows:


2432.704  Limitation of cost or funds.

    77. Add 2432.704-70 to read as follows:


2432.704-70  Incrementally funded fixed-price contracts.

    (a) Upon receipt of the contractor's notice under paragraph (c) of 
the clause at 2452.232-72, Limitation of Government's Obligation, the 
contracting officer shall promptly provide written notice to the 
contractor that the Government is--
    (1) Allotting additional funds for continued performance and 
increasing the Government's limitation of obligation in a specified 
amount;
    (2) Terminating the affected contract line items (CLINs) or 
contract, as applicable; or
    (3) Considering whether to allot additional funds; and
    (i) The contractor is required by the contract terms to stop work 
when the Government's limitation of obligation is reached; and
    (ii) Any costs expended beyond the Government's limitation of 
obligation are at the contractor's risk.
    (b) Upon learning that the contract will receive no further funds, 
the contracting officer shall promptly give the contractor written 
notice of the Government's decision and terminate the affected CLINs or 
contract, as applicable, for the convenience of the Government.
    (c) The contracting officer shall ensure that, in accordance with 
paragraph (b) of the clause at 2452.232-72, ``Limitation of 
Government's obligation,'' sufficient funds are allotted to the 
contract to cover the total amount payable to the contractor in the 
event of termination for the convenience of the Government.
    78. Add 2432.705 to read as follows:


2432.705  Contract clauses.

    79. Add 2432.705-70 to read as follows:


2432.705-70  Clause for limitation of Government's obligation.

    The contracting officer shall insert the clause at 2452.232-72, 
``Limitation of Government's Obligation,'' in solicitations and 
resultant incrementally funded fixed-price contracts as authorized by 
2432.703-1. The contracting officer shall insert the information 
required in the table in paragraph (b) and the notification period in 
paragraph (c) of the clause.

Subpart 2432.9--Prompt Payment

    80. Revise 2432.903 to read as follows:


2432.903  Policy.

    (a) The Senior Procurement Executive is the agency head's designee 
for the purposes of FAR 32.903(a).
    81. Revise 2432.906 to read as follows:


2432.906  Making payments.

    (a) General. The authority to make the determination prescribed in 
FAR 32.906(a) is delegated to the HCA. Before making this 
determination, the HCA shall consult with the appropriate payment 
office to ensure that procedures are in place to permit timely payment.
    82. In 2432.908, revise paragraphs (c)(1) and (2) to read as 
follows:


2432.908  Contract clauses.

    (c) * * *
    (1) The contracting officer shall insert the clause at 2452.232-73, 
Constructive Acceptance Period, in solicitations and contracts when the 
contracting officer has determined that an acceptance period longer 
than the 7 days provided for in the FAR clause at 52.232-25, ``Prompt 
Payment,'' is needed.
    (2) The contracting officer shall insert a clause substantially the 
same as provided at 2452.232-71, Voucher Submission, in all cost-
reimbursement, time-and-materials, and labor-hour type solicitations 
and contracts. The contracting officer shall insert the billing 
frequency period agreed upon with the contractor (see also the FAR 
clause at 52.216-7, ``Allowable Cost and Payment'').
* * * * *

PART 2437--SERVICE CONTRACTING

    83. The authority citation for part 2437 is revised to read as 
follows:

    Authority: 40 U.S.C. 121(c); 42 U.S.C. 3535(d).

Subpart 2437.1--Service Contracts--General

    84. Revise 2437.110 to read as follows:


2437.110  Solicitation provisions and contract clauses.

    (e)(1) The Contracting Officer shall insert the clause at 2452.237-
70, Key Personnel, in solicitations and contracts when it is necessary 
for contract performance to identify Contractor Key personnel.
    (2) The Contracting Officer shall insert the clause at 2452.237-73, 
Conduct of Work and Technical Guidance, in all solicitations contracts 
for services other than commercial services awarded pursuant to FAR 
part 12.
    (3) The contracting officer shall insert the clause at 2452.237-75, 
Access to HUD Facilities, in all solicitations and contracts when 
contractor employees, including subcontractors and consultants, will be 
required to regularly work in or have access to any HUD facilities (as 
distinct from nongovernment employee visitors to government 
facilities).
    (4) The Contracting Officer shall insert the clause at 2452.237-77, 
Temporary Closure of HUD Facilities, in all solicitations and contracts 
where contractor personnel will be working on-site in any HUD office.

PART 2439--ACQUISITION OF INFORMATION TECHNOLOGY

    85. The authority citation for part 2439 continues to read as 
follows:

    Authority: 40 U.S.C. 121(c); 42 U.S.C. 3535(d).

Subpart 2439.1--General

    86. Revise 2439.107(a) to read as follows:


2439.107  Contract clauses.

    (a) The contracting officer shall insert the clause at 2452.239-70, 
Access to HUD Systems, in solicitations and contracts when the contract 
will require contractor employees, including subcontractors and 
consultants, to have access to any HUD information system(s) as defined 
in the clause.
* * * * *

PART 2442--CONTRACT ADMINISTRATION AND AUDIT SERVICES

    87. The authority citation for part 2442 is revised to read as 
follows:

    Authority: 40 U.S.C. 486(c); 121(c); 42 U.S.C. 3535(d).

    88. The heading for part 2442 is revised to read as set forth 
above.
    89. Add subpart 2442.3 to read as follows:

Subpart 2442.3--Contract Administration Office Functions

Sec.
2442.302-70 Contract clause.

[[Page 15694]]

2442.302-70  Contract clause.

    The contracting officer shall include clause 2452.242-72, Post-
award Orientation Conference, in solicitations and contracts when the 
contractor will be required to attend a post-award orientation 
conference. The contracting officer shall indicate whether the 
contractor must attend the conference in person or via electronic 
communication.

PART 2452--SOLICITATION PROVISIONS AND CONTRACT CLAUSES

    90. The authority citation for part 2452 is revised to read as 
follows:

    Authority: 40 U.S.C. 121(c); 42 U.S.C. 3535(d).

    91. Add 2452.204-70 to read as follows:


2452.204-70  Preservation of, and access to, contract records (tangible 
and electronically stored information (ESI) formats).

    As prescribed in 2404.7001, insert the following clause:

PRESERVATION OF, AND ACCESS TO, CONTRACT RECORDS (TANGIBLE AND 
ELECTRONICALLY STORED INFORMATION (ESI) FORMATS) (* * *)

    (a) For the purposes of this clause--
    ``Contract records'' means information created or maintained by 
the contractor in the performance of the contract. Contract records 
include documents required to be retained in accordance with FAR 
4.703 and other information generated or maintained by the 
contractor that is pertinent to the contract and its performance 
including, but not limited to: email and attachments, formal and 
informal correspondence, calendars, notes, reports, memoranda, 
spreadsheets, tables, telephone logs, forms, survey, books, papers, 
photographs, drawings, machine-readable materials, and data. 
Contract records may be maintained as electronically stored 
information or as tangible materials. Contract records may exist in 
either final or any interim version (e.g., drafts that have been 
circulated for official purposes and contain unique information, 
such as notes, edits, comments, or highlighting). Contract records 
may be located or stored on the contractor's premises or at off-site 
locations.
    ``Electronically stored information (ESI)'' means any contract 
records that are stored on, or generated by, an electronic device, 
or contained in electronically accessible media, either owned by the 
contractor, subcontractor(s), or employees of the contractor or 
subcontractor(s) regardless of the physical location of the device 
or media (e.g., offsite servers or data storage).
    ``ESI devices and media'' include, but are not be limited to:
    (i) Computers (mainframe, desktop, and laptop);
    (ii) Network servers, including shared and personal drives;
    (iii) Individual email accounts of the contractor's principals, 
officers, and employees, including all folders contained in each 
email account such as ``inbox,'' ``outbox,'' ``drafts,'' ``sent,'' 
``trash,'' ``archive,'' and any other folders;
    (iv) Personal data assistants (PDAs);
    (v) External data storage devices including portable devices 
(e.g., flash drive); and
    (vi) Data storage media (magnetic, e.g., tape; optical, e.g., 
compact disc, microfilm, etc.).
    ``Tangible materials'' means contract records that exist in a 
physical (i.e., non-electronic) state.
    (b) If during the period of performance of this contract, HUD 
becomes, or anticipates becoming, a party to any litigation 
concerning matters related to records maintained or generated by the 
Contractor in the performance of this contract, the Contracting 
Officer may provide the contractor with a written (either hardcopy 
or email) preservation hold notice and certification of compliance 
with the preservation hold notice. Upon receipt of the hold notice, 
the Contractor shall immediately take the following actions--
    (1) Discontinue any alteration, overwriting, deletion, or 
destruction of all tangible materials and ESI.
    (2) Preserve tangible materials and ESI. The contractor shall 
preserve ESI in its ``native'' form to preserve metadata (i.e., 
creation and modification history of a document).
    (3) Identify all individuals who possess or may possess tangible 
materials and ESI related to this matter, including contractor 
employees, subcontractors, and subcontractor employees. The 
contractor shall provide the names of all such individuals via email 
to the HUD official indicated in the notice.
    (4) Document in writing the contractor's efforts to preserve 
tangible materials and ESI. It may be useful to maintain a log 
documenting preservation efforts.
    (5) Complete the certification of compliance with the 
preservation hold notice upon receipt and return it to the 
identified contact person; and
    (6) Upon the request of the Contracting Officer, provide the 
Contracting Officer or other HUD official designated by the 
Contracting Officer with any of the information described in this 
clause. The contractor shall immediately confirm receipt of such 
request. The contractor shall describe in detail any records that 
the contractor knows or believes to be unavailable and provide a 
detailed explanation of why they are unavailable, and if known, 
their location.
    (c)(1) If any request for records pursuant to paragraph (b)(6) 
of this clause causes an increase in the estimated cost or price or 
the time required for performance of any part of the work under this 
contract, or otherwise affects any other terms and conditions of 
this contract, the Contracting Officer shall make an equitable 
adjustment in the contract price, the delivery schedule, or both, 
and shall modify the contract.
    (2) The Contractor must assert its right to an adjustment under 
this clause within ----[Contracting Officer insert period; 30 days 
if no other period inserted] from the date of receipt of the 
Contracting Officer's request made pursuant to paragraph (b)(6) of 
this clause. However, if the Contracting Officer decides that the 
facts justify it, the Contracting Officer may receive and act upon a 
request submitted before final payment of the contract.
    (3) Failure to agree to any adjustment shall be a dispute under 
the ``Disputes'' clause of this contract. However, nothing in this 
clause shall excuse the contractor from providing the records 
requested by the Contracting Officer.
    (e) The Contractor shall include this clause in all 
subcontracts.

    (End of clause)
    Alternate I (* * *). For cost-reimbursement type contracts, 
substitute the following paragraph (c)(1) for paragraph (c)(1) of the 
basic clause:

    (c)(1) If any request for records pursuant to paragraph (b)(6) 
of this clause causes an increase in the estimated cost or price or 
the time required for performance of any part of the work under this 
contract, or otherwise affects any other terms and conditions of 
this contract, the Contracting Officer shall make an equitable 
adjustment in any one of the following and modify the contract 
accordingly--
    (i) Estimated cost;
    (ii) Delivery or completion schedule, or both;
    (ii) Amount of any fixed fee; or
    (iii) Other affected terms.

    Alternate II (* * *). For labor-hour or time-and-materials type 
contracts, substitute the following paragraph (c)(1) for paragraph 
(c)(1) of the basic clause:

    (c)(1) If any request for records pursuant to paragraph (b)(6) 
of this clause causes an increase in the estimated cost or price or 
the time required for performance of any part of the work under this 
contract, or otherwise affects any other terms and conditions of 
this contract, the Contracting Officer shall make an equitable 
adjustment in any one or more of the following and will modify the 
contract accordingly:
    (i) Ceiling price;
    (ii) Hourly rates;
    (iii) Delivery schedule; or
    (iv) Other affected terms.

    92. In 2452.215-70, add Alternate III immediately following 
Alternate II, to read as follows:


2452.215-70  Proposal content.

* * * * *
    Alternate III (* * *). As prescribed in 2415.209(a), add the 
following paragraph (e) when the size of Part I, Technical and 
Management, offers will be limited:
    (e) Size limit of Part I, Technical and Management.
    (1) Offerors shall limit Part I, Technical and Management, of their 
initial offers to -------- [Contracting Officer insert number] pages, 
except for the information specifically exempted in paragraph (3). 
Offerors are cautioned that if Part I of their offers exceeds this 
limit, the Government will evaluate

[[Page 15695]]

only the information contained in the pages up through the permitted 
number. Pages beyond that limit will not be evaluated.
    (2) A page shall consist of one side of a single sheet of 8\1/2\'' 
x 11'' paper, single spaced, using not smaller than 12 point type font, 
and having margins at the top, bottom, and sides of the page of no less 
than one inch in width.
    (3) The following information is exempt from the limitation set 
forth in paragraph (1): [Contracting Officer list exemptions or enter 
``None''].
    (4) Offerors are encouraged to use recycled paper and to use both 
sides of the paper (see the FAR clause at 52.204-4).
    93. Add 2452.215-71 to read as follows:


2452.215-71  Relative importance of technical evaluation factors to 
cost or price.

    As prescribed in 2415.209(a)(2), insert the following provision:

RELATIVE IMPORTANCE OF TECHNICAL EVALUATION FACTORS TO COST OR PRICE (* 
* *)

    For the purposes of evaluating offers and the selection of the 
contractor or contractors under this solicitation, the relative 
merit of the offeror's technical proposal as evaluated in accordance 
with the technical evaluation factors listed herein shall be 
considered [Contracting Officer insert one of the following: 
``significantly more important than,'' ``approximately equal to,'' 
or ``significantly less important than''] cost or price. While the 
proposed cost or price will not be assigned a specific weight, it 
shall be considered a significant criterion in the overall 
evaluation of proposals.

    94. Add 2452.215-72 to read as follows:


2452.215-72  Evaluation of small business participation.

    As prescribed in 2415.370, insert the following provision:

EVALUATION OF SMALL BUSINESS PARTICIPATION (* * *)

    (a) In addition to the technical and management evaluation 
factors set forth in this solicitation, the Government will evaluate 
the extent to which all offerors identify and commit to using small 
businesses in the performance of the contract, whether through joint 
ventures or teaming arrangements, or as subcontractors. The 
evaluation shall consider the following:
    (1) The extent to which small businesses are specifically 
identified in proposals;
    (2) The extent of commitment to use small businesses (for 
example, enforceable commitments will be weighted more heavily than 
non-enforceable ones);
    (3) The complexity and variety of the work small businesses are 
to perform;
    (4) The realism of the proposal;
    (5) Past performance of the offerors (other than small 
businesses) in complying with requirements of the clauses at FAR 
52.219-8, Utilization of Small Business Concerns, and 52.219-9, 
Small Business Subcontracting Plan; and
    (6) The extent of participation of small businesses in terms of 
the total value of the contract.
    (b) Offerors that are required to submit a subcontracting plan 
pursuant to the clause at FAR 52.219-9 shall include the small 
businesses proposed as subcontractors for evaluation under this 
provision in their subcontracting plan.

    (End of Provision)
    95. Revise 2452.216-76 to read as follows:


2452.216-76  Minimum and maximum quantities or amounts for order.

    As prescribed in 2416.506-70(b), insert the following clause:

MINIMUM AND MAXIMUM QUANTITIES OR AMOUNTS FOR ORDER (* * *)

    (a) The minimum quantity or amount to be ordered under this 
contract shall not be less than [contracting officer insert quantity 
or amount].
    (b) The maximum quantity or amount to be ordered under this 
contract shall not exceed [contracting officer insert quantity or 
amount].

    (End of clause)
    96. Add 2452.216-79 to read as follows:


2452.216-79  Estimated cost (no fee).

    As prescribed in 2416.307(b), insert the following clause:

ESTIMATED COST (NO FEE) (* * *)

    (a) It is estimated that the total reimbursable cost to the 
Government for full performance of this contract will be $----------
-- [Contracting Officer insert amount].
    (b) If this contract is incrementally funded, the following 
shall apply:
    (1) Total funds currently available for payment and allotted to 
this contract are $------------ [Contracting Officer insert amount] 
(see also the clause at FAR 52.232-22, ``Limitation of Funds'' 
herein).
    (2) If and when the contract is fully funded, as specified in 
paragraph (a) of this clause, the clause at FAR 52.232-20, 
Limitation of Cost, herein, shall become applicable.
    (3) The Contracting Officer may allot additional funds to the 
contract up to the total specified in paragraph (a) of this clause 
without the concurrence of the contractor.

    (End of clause)
    97. Add 2452.216-80 to read as follows:


2452.216-80  Estimated cost and fixed-fee.

    As prescribed in 2416.307(b), insert the following clause:

ESTIMATED COST AND FIXED-FEE (* * *)

    (a) It is estimated that the total cost to the Government for 
full performance of this contract will be $------------ [Contracting 
Officer insert amount], of which $------------ [Contracting Officer 
insert amount] represents the estimated reimbursable costs, and $--
---------- [Contracting Officer insert amount] represents the fixed 
fee.
    (b) If this contract is incrementally funded, the following 
shall apply:
    (1) Total funds currently available for payment and allotted to 
this contract are $------------ [Contracting Officer insert amount], 
of which ------------ [Contracting Officer insert amount] represents 
the limitation for reimbursable costs and $------------ [Contracting 
Officer insert amount] represents the prorated amount of the fixed 
fee (see also the clause at FAR 52.232-22, ``Limitation of Funds'' 
herein).
    (2) If and when the contract is fully funded, as specified in 
paragraph (a) of this clause, the clause at FAR 52.232-20, 
``Limitation of Cost,'' herein, shall become applicable.
    (3) The Contracting Officer may allot additional funds to the 
contract up to the total specified in paragraph (a) of this clause 
without the concurrence of the contractor.

    (End of clause)
    98. Add 2452.219-71 to read as follows:


2452.219-71  Notification of competition limited to eligible 8(a) 
concerns--Alternate III to FAR 52.219-18.

    As prescribed in 2419.811-3(d)(3), insert the following clause:

NOTIFICATION OF COMPETITION LIMITED TO ELIGIBLE 8(a) CONCERNS--
ALTERNATE III TO FAR 5219-18 (* * *)

    The following paragraph (c) replaces paragraph (c) of the clause 
at FAR 52.219-18, Notification of Competition Limited to Eligible 
8(a) Concerns:
    (c) Any award resulting from this solicitation will be made 
directly by the HUD Contracting Officer to the successful 8(a) 
offeror selected through the evaluation criteria set forth in this 
solicitation.

    99. Add 2452.219-72 to read as follows:


2452.219-72  Section 8(a) direct awards (Deviation).

    As prescribed in 2419.811-3(f), insert the following clause:

SECTION 8(A) DIRECT AWARD (* * *)

    (a) This contract is issued as a direct award between the 
Department of Housing and Urban Development (HUD) and the 8(a) 
Contractor pursuant to a Partnership Agreement (Agreement) between 
the Small Business Administration (SBA) and HUD. The SBA retains 
responsibility for 8(a) certification, 8(a) eligibility 
determinations and related issues, and providing counseling and 
assistance to the 8(a) contractor under the 8(a) program. The 
cognizant SBA district office is:
    [To be completed by Contracting Officer at time of award].
    (b) SBA is the prime contractor and ------------ [insert name of 
8(a) contactor] is the subcontractor under this contract.

[[Page 15696]]

Under the terms of the Agreement, HUD is responsible for 
administering the contract and taking any action on behalf of the 
Government under the terms and conditions of the contract. However, 
the HUD Contracting Officer shall give advance notice to the SBA 
before issuing a final notice terminating performance, either in 
whole or in part, under the contract. The HUD Contracting Officer 
shall also coordinate with SBA prior to processing any novation 
agreement. HUD may assign contract administration functions to a 
contract administration office.
    (c) ---------------- [insert name of 8(a) contractor] agrees:
    (1) To notify the HUD Contracting Officer, simultaneously with 
its notification to SBA (as required by SBA's 8(a) regulations), 
when the owner or owners upon whom 8(a) eligibility is based, plan 
to relinquish ownership or control of the concern. Consistent with 
15 U.S.C. 637(a)(21), transfer of ownership or control shall result 
in termination of the contract for convenience, unless SBA waives 
the requirement for termination prior to the actual relinquishing of 
ownership or control.
    (2) To adhere to the requirements of FAR 52.219-14, 
``Limitations on Subcontracting.''

    (End of Clause)
    100. Add 2452.219-73 to read as follows:


2452.219-73  Incorporation of subcontracting plan.

    As prescribed in 2419.708(b), insert the following clause:

INCOPORATION OF SUBCONTRACTING PLAN (* * *)

    The Contractor's approved subcontracting plan, dated ----------
-- [Contracting Officer insert date] is hereby incorporated by 
reference and made a part of this contract.

    (End of clause)
    101. Add 2452.219-74 to read as follows:


2452.219-74  Small business subcontracting goals.

    As prescribed in 2419.708(b), insert the following provision:

SMALL BUSINESS SUBCONTRACTING GOALS (* * *)

    (a) This provision does not apply to offerors that are small 
businesses.
    (b) The offeror's attention is directed to the FAR clause at 
52.219-9, ``Small Business Subcontracting Plan,'' herein. HUD will 
evaluate proposed subcontracting plans using the Departmental small 
business subcontracting goals set forth in paragraph (c). Offerors 
that are unable to propose subcontracting that meets HUD's 
established goals must provide the rationale for their proposed 
level of subcontracting.
    (c) HUD's subcontracting goals are as follows:
    (i) Small Business ------% [Contracting Officer insert HUD small 
business subcontracting goal percentage]
    (ii) The total Small Business goal shown in paragraph (i) 
contains the following subordinate goals [Contracting Officer insert 
percentages]:
    (A) Small Disadvantaged Business------%
    (B) Women-Owned Small Business------%
    (C) Service-Disabled Veteran-Owned Small Business------%
    (D) HUBZone Small Business------%

    (End of Provision)
    102. Add 2452.227-70 to read as follows:


2452.227-70  Government information.

    As prescribed in 2427.470, use the following clause:

GOVERNMENT INFORMATION (* * *)

    (a) Definitions. As used in this clause, ``Government 
information'' includes--
    ``Contractor-acquired information,'' which means information 
acquired or otherwise collected by the Contractor on behalf of the 
Government in the context of the Contractor's duties under the 
contract.
    ``Government-furnished information (GFI),'' which means 
information in the possession of, or directly acquired by, the 
Government and subsequently furnished to the Contractor for 
performance of a contract. GFI also includes contractor-acquired 
information if the contractor-acquired information is a deliverable 
under the contract and is for continued use under the contract. 
Otherwise, GFI does not include information that is created by the 
Contractor and delivered to the Government in accordance with the 
requirements of the work statement or specifications of the 
contract. The type, quantity, quality, and delivery requirements of 
such deliverable information are set forth elsewhere in the contract 
schedule.
    (b) Information Management and Information Security.
    (1) The Contractor shall manage, account for, and secure all 
Government information provided or acquired by the contractor. The 
Contractor shall be responsible for all Government information 
provided to its subcontractors. The Contractor agrees to include a 
requirement in each subcontract under this contract that flows down 
the protection from disclosure requirements.
    (2) The Contractor's responsibility for Government information 
extends from the initial provision or acquisition and receipt of 
information, through stewardship, custody, and use until returned 
to, or otherwise disposed of, as directed by the Contracting 
Officer. This requirement applies to all Government information 
under the Contractor's accountability, stewardship, possession or 
control, including its subcontractors.
    (c) Use of Government information. (1) The Contractor shall not 
use any information provided or acquired under this contract for any 
purpose other than in the performance of this contract.
    (2) The Contractor shall not modify or alter the Government 
information, unless authorized in writing, in advance, by the 
Contracting Officer.
    (d) Government-furnished information. (1) The Government shall 
deliver to the Contractor the information described below--

Description

Date to be Provided

[Contracting Officer insert]

    (2) The delivery and/or performance dates specified in this 
contract are based upon the expectation that the Government-
furnished information will be suitable for contract performance and 
will be delivered to the Contractor by the dates stated in paragraph 
(d)(1) of this clause.
    (i) The Government does not warrant the validity or accuracy of 
the Government-furnished information unless otherwise noted.
    (ii) In the event that information received by the Contractor is 
not in a condition suitable for its intended use, the Contractor 
shall immediately notify the Contracting Officer in writing. Upon 
receipt of the Contractor's notification, the Contracting Officer 
shall advise the Contractor on a course of action to remedy the 
problem.
    (iii) If either the failure of the Government to provide 
information to the Contractor by the dates shown in this clause or 
the remedial action taken under this clause to correct defective 
information causes an increase or decrease in the Contractor's cost 
of, or the time required for, the performance of any part of the 
work under this contract, the Contracting Officer shall consider an 
equitable adjustment to the contract. The Contractor shall provide 
to the Contracting Officer its written statement describing the 
general nature and amount of the equitable adjustment proposal 
within 30 days after the remedial action described in paragraph (ii) 
herein is completed, or within 30 days after the date upon which the 
Government failed to provide information, unless the Contracting 
Officer extends this period.
    (3)(i) The Contracting Officer may, by written notice, at any 
time--
    (A) Increase or decrease the amount of Government-furnished 
information under this contract;
    (B) Substitute other Government-furnished information for the 
information previously furnished, to be furnished, or to be acquired 
by the Contractor for the Government under this contract; or
    (C) Withdraw authority to use the information.
    (ii) Upon completion of any action(s) under paragraph (d)(3)(i) 
of this clause, and the Contractor's timely written request, the 
Contracting Officer shall consider an equitable adjustment to the 
contract.
    (e) Rights in information. Government information is the 
property of the U.S. Government unless otherwise specifically 
identified. The specific rights in any other information acquired or 
created by the Contractor under this contract shall be as expressed 
in the ``Rights in Data'' clause contained in this contract.
    (f) Government access to information. The Government shall have 
the right to access any Government information maintained by the 
contractor and any subcontractors. The Contractor shall provide the 
Contracting Officer, and other duly authorized

[[Page 15697]]

Government representatives, with access to all Government 
information, including access to the Contractor's facilities, as 
necessary, promptly upon written notification by the Contracting 
Officer. Such notification may be by electronic mail.
    (g) Contractor liability for Government information. (1) Unless 
otherwise provided for in the contract, the Contractor shall not be 
liable for loss, theft, damage, or destruction to the Government 
information furnished or acquired under this contract, except when 
the loss, theft, damage, or destruction is the result of the 
Contractor's failure to properly manage, account for, and safeguard 
the information in accordance with this clause.
    (2) In the event of any loss, theft, damage, or destruction of 
Government information, the Contractor shall immediately take all 
reasonable actions necessary to protect the Government information 
from further loss, theft, damage, or destruction.
    (3) The Contractor shall do nothing to prejudice the 
Government's rights to recover against third parties for any loss, 
theft, damage, or destruction of Government information.
    (h) Information alteration and disposal. Except as otherwise 
provided for in this contract, the Contractor shall not alter, 
destroy, or otherwise dispose of any Government information unless 
expressly directed by the Contracting Officer to do so.
    (i) Return of Government information to the Government. (1) The 
Government may require the Contractor to return Government 
Information to the Government at any time. Upon demand by the 
Contracting Officer or his/her representative, the Contractor shall 
return all Government information to the Government as directed by 
the Contracting Officer or other individual designated by the 
Contracting Officer.
    (2) The Contractor's failure to return all information as 
directed, including directions regarding the time frames for 
delivery back to the Government and directions prescribing the form 
in which the data must be returned, shall be considered a breach of 
contract, and the Government shall have the right to physically 
remove the Government information from the Contractor, including 
removal of such information from the Contractor's physical premises 
and from any electronic media (e.g., Contractor's computer systems).
    (3) When required to return Government information to the 
Government, the Contractor shall do so at no cost to the Government. 
The Government shall not be responsible for the cost of data format 
conversion and the cost of delivery, if any.
    (4) The Contractor shall ensure that all Government information 
provided to subcontractors is returned to the Government.
    (j) Equitable adjustment. Equitable adjustments under this 
clause shall be made in accordance with the procedures of the 
Changes clause. However, the Government shall not be liable for 
breach of contract for the following:
    (1) Any delay in delivery of Government-furnished information.
    (2) Delivery of Government-furnished information in a condition 
not suitable for its intended use.
    (3) An increase, decrease, or substitution of Government-
furnished information.
    (4) Failure to correct or replace Government information for 
which the Government is responsible.
    Alternate I. When the contracting officer determines that the 
failure to return Government information as provided for in 
paragraph (i) shall result in a monetary damage to the Government, 
the contracting officer shall include the following subparagraph 
(i)(5). The contracting officer shall consult the requiring activity 
to determine an amount or percentage that accurately reflects the 
damages to the Government.
    (5) In the event of Contractor delay in returning the Government 
Information to the Government, for each calendar day late, the 
Contracting Officer has the discretion to deduct ----[Contracting 
Officer insert dollar amount or percentage] from the total value of 
the contract, and/or withhold payment from the Contractor
    (k) Subcontracts. The Contractor shall ensure that all 
subcontracts under which Government information is provided to a 
subcontractor include the basic terms and conditions set forth in 
paragraphs (a), (b), (c), (f), and (h) of this clause in each 
subcontract. Subcontracts shall clearly describe the Government 
information provided to the subcontractor. The Contractor shall be 
responsible for all Government information provided to 
subcontractors.

    (End of clause)
    103. Revise 2452.232 to read as follows:


2452.232-70  Payment schedule and invoice submission (Fixed-price).

    As prescribed in 2432.908(c)(1), insert the following clause in all 
fixed-price solicitations and contracts:

PAYMENT SCHEDULE AND INVOICE SUBMISSION (FIXED-PRICE) (* * *)

    (a) Payment Schedule. Payment of the contract price (see Section 
B of the contract) will be made upon completion and acceptance of 
all work unless a partial payment schedule is included below 
[Contracting Officer insert schedule information]:

------------------------------------------------------------------------
Partial payment   Applicable contract
     number           deliverable        Delivery date    Payment amount
------------------------------------------------------------------------
1.
2.
3.
------------------------------------------------------------------------

    [Continue as necessary]
    (b) Submission of Invoices. (1) The Contractor shall submit 
invoices as follows: original to the payment office and one copy 
each to the Contracting Officer and a copy to the Government 
Technical Representative (GTR) identified in the contract. To 
constitute a proper invoice, the invoice must include all items 
required by the FAR clause at 52.232-25, ``Prompt Payment.''
    (2) To assist the government in making timely payments, the 
contractor is also requested to include on each invoice the 
appropriation number shown on the contract award document (e.g., 
block 14 of the Standard Form (SF) 26, block 21 of the SF-33, or 
block 25 of the SF-1449). The contractor is also requested to 
clearly indicate on the mailing envelope that an invoice is 
enclosed.
    (c) Contractor Remittance Information. The contractor shall 
provide the payment office with all information required by other 
payment clauses or other supplemental information (e.g., contracts 
for commercial services) contained in this contract.
    (d) Final Invoice Payment. The final invoice shall not be paid 
prior to certification by the Contracting Officer that all work has 
been completed and accepted.

    (End of clause)
    104. Revise 2452.232-71 to read as follows:


2452.232-71  Voucher submission.

    As prescribed in 2432.908(c)(2), insert the following clause in all 
cost-reimbursement, time-and-materials, and labor-hour solicitations 
and contracts:

VOUCHER SUBMISSION (* * *)

    (a) Voucher Submission. (1) The contractor shall submit, ------
------ [Contracting Officer insert billing period, e.g., monthly], 
an original and two copies of each voucher. In addition to the items 
required by the clause at FAR 52.232-25, Prompt Payment, the voucher 
shall show the elements of cost for the billing period and the 
cumulative costs to date. The Contractor shall submit all vouchers, 
except for the final voucher, as follows: original to the payment 
office and one copy each to the Contracting Officer and the 
Government Technical Representative (GTR) identified in the 
contract. The contractor shall submit all copies of the final 
voucher to the Contracting Officer.
    (2) To assist the government in making timely payments, the 
contractor is requested to include on each voucher the applicable 
appropriation number(s) shown on the award or subsequent 
modification document (e.g., block 14 of the Standard Form (SF) 26, 
or block 21 of the SF-33). The contractor is also requested to 
clearly indicate on the mailing envelope that a payment voucher is 
enclosed.
    (b) Contractor Remittance Information. (1) The Contractor shall 
provide the payment office with all information required by other 
payment clauses contained in this contract.
    (2) For time-and-materials and labor-hour contracts, the 
Contractor shall aggregate vouchered costs by the individual task 
for which the costs were incurred and clearly identify the task or 
job.
    (c) Final Payment. The final payment shall not be made until the 
Contracting Officer has certified that the contractor has complied 
with all terms of the contract.

    (End of clause)
    105. Add section 2452.232-72 to read as follows:

[[Page 15698]]

2452.232-72  Limitation of Government's obligation.

    As prescribed in 2432.705-70, use the following clause:

LIMITATION OF GOVERNMENT'S OBLIGATION (* * *)

    (a) Funds are not available for full funding of all contract 
line items under this contract. The incrementally funded line items 
and their anticipated funding schedule are as follows:

----------------------------------------------------------------------------------------------------------------
                                                                   Amount of current      Anticipated date(s) of
      Contract line item number              Total price                funding               future funding
----------------------------------------------------------------------------------------------------------------
 
 
----------------------------------------------------------------------------------------------------------------
 
----------------------------------------------------------------------------------------------------------------
 
----------------------------------------------------------------------------------------------------------------
 
----------------------------------------------------------------------------------------------------------------
 
----------------------------------------------------------------------------------------------------------------

    The contracting officer will revise this table as funds are 
allotted to the contract.
    (b) For the incrementally funded line item(s) in paragraph (a) 
of this clause, the Contractor agrees to perform up to the point at 
which the total amount payable by the Government, including 
reimbursement in the event of termination of those item(s) for the 
Government's convenience, approximates the total amount currently 
allotted to the contract for these contract line items. The 
Contractor is not authorized to continue work on the incrementally 
funded line item(s) beyond that point. The Government will in no 
event be obligated to reimburse the Contractor in excess of the 
amount allotted to the contract for the incrementally funded line 
item(s) regardless of anything to the contrary in the clause 
entitled ``Termination for Convenience of the Government.'' As used 
in this clause, the total amount payable by the Government in the 
event of termination for convenience of applicable line item(s) 
includes costs, profit, and estimated termination settlement costs 
for those line item(s).
    (c) Notwithstanding the dates specified in the allotment 
schedule in paragraph (a) of this clause, the Contractor will notify 
the Contracting Officer in writing at least -- [90 days unless the 
Contracting Officer inserts a different number] days prior to the 
date when, in the Contractor's best judgment, the work will reach 
the point at which the total amount payable by the Government, 
including any cost for termination for convenience, will approximate 
85 percent of the total amount then allotted to the contract for 
performance of the applicable line item(s). This notification will 
state: The estimated date when that point will be reached; and an 
estimate of the amount of additional funding, if any, needed to 
continue performance of the applicable line items up to the next 
scheduled date for allotment of funds identified in paragraph (a) of 
this clause (or to another mutually agreed-upon date). The 
notification will also advise the Contracting Officer of the 
estimated amount of additional funds that will be required for the 
timely performance of the line item(s) funded pursuant to this 
clause, for a subsequent period as may be specified in the allotment 
schedule in paragraph (a) of this clause or otherwise agreed to by 
the parties. If after such notification additional funds are not 
allotted by the date identified in the Contractor's notification, or 
by an agreed-upon date, the Contracting Officer will terminate any 
line item(s) for which additional funds have not been allotted, 
pursuant to the clause of this contract entitled ``Termination for 
Convenience of the Government.''
    (d) When additional funds are allotted for continued performance 
of the incrementally funded line item(s), the parties will agree to 
the period of contract performance covered by the funds. The 
provisions of paragraphs (b) through (d) of this clause will apply 
in like manner to the additional allotted funds and agreed-upon 
date(s), and the contract will be modified accordingly.
    (e) If the Contractor incurs additional costs or is delayed in 
the performance of the work under this contract solely by reason of 
the failure of the Government to allot additional funds in amounts 
sufficient for timely performance of the incrementally funded line 
item(s), and then additional funds are allotted, an equitable 
adjustment will be made in the line item price(s) or in the time of 
delivery, or both. Failure to agree to any such equitable adjustment 
hereunder shall be considered a dispute subject to the ``Disputes'' 
clause in this contract.
    (f) The Government may allot additional funds for the 
performance of the incrementally-funded line item(s) at any time 
prior to termination.
    (g) The termination provisions of this clause do not limit the 
rights of the Government under the clause entitled ``Default.'' The 
provisions of this clause are limited to the work and allotment of 
funds for the incrementally funded line item(s) and will no longer 
apply once the contract is fully funded except with regard to the 
rights or obligations of the parties concerning equitable 
adjustments negotiated under paragraphs (d) and (e) of this clause.
    (h) Nothing in this clause affects the right of the Government 
to terminate this contract pursuant to the clause of this contract 
entitled ``Termination for Convenience of the Government.''
    (i) Nothing in this clause shall be construed as authorization 
of voluntary services whose acceptance is otherwise prohibited under 
31 U.S.C. 1342.

    (End of clause)
    106. Add 2452.232-73 to read as follows:


2452.232-73  Constructive acceptance period.

    As prescribed in 2432.908, insert the following clause:

CONSTRUCTIVE ACCEPTANCE PERIOD (* * *)

    As authorized by FAR 32.908(c)(1), the constructive acceptance 
period in paragraph (a)(5)(i) of the clause at FAR 52.232-25, 
``Prompt Payment,'' under this contract is ---- [Contracting Officer 
insert number] calendar days.
    (End of clause)
    107. In 2452.237-70, revise the introductory text to read as 
follows:


2452.237-70  Key personnel.

    As prescribed in 2437.110(e)(1), insert the following clause in 
solicitations and contracts when it is necessary for contract 
performance to identify the contractor's key personnel:
* * * * *


2452.237-72  [redesignated]

    108. Redesignate 2452.237-72 as 2452.201-70, and revise the 
introductory text to read as follows:


2452.201-70  Coordination of Data Collection Activities.

    As prescribed in 2401.106-70, insert the following clause in 
solicitations and contracts where the contractor is required to collect 
identical information from ten or more public respondents:
* * * * *
    109. In 2452.237-73, revise the introductory text and paragraph (a) 
to read as follows:


2452.237-73  Conduct of work and technical guidance.

    As prescribed in 2437.110(e)(2), insert the following clause in all 
contracts for services:

[[Page 15699]]

CONDUCT OF WORK AND TECHNICAL GUIDANCE (* * *)

    (a) The Contracting Officer will provide the contractor with the 
name and contact information of the Government Technical 
Representative (GTR) assigned to this contract. The GTR will serve 
as the contractor's liaison with the Contracting Officer with regard 
to the conduct of work. The Contracting Officer will notify the 
contractor in writing of any change to the current GTR's status or 
the designation of a successor GTR.
* * * * *
    110. Revise 2452.237-75 to read as follows:


2452.237-75  Access to HUD facilities.

    As prescribed in 2437.110(e)(3), insert the following clause in 
solicitations and contracts:

ACCESS TO HUD FACILITIES (* * *)

    (a) Definitions. As used in this clause--
    ``Access'' means physical entry into and, to the extent 
authorized, mobility within a Government facility.
    ``Contractor employee'' means an employee of the prime 
contractor or of any subcontractor, affiliate, partner, joint 
venture, or team members with which the contractor is associated. It 
also includes consultants engaged by any of those entities.
    ``Facility'' and ``Government facility'' mean buildings, 
including areas within buildings that are owned, leased, shared, 
occupied, or otherwise controlled by the Federal Government.
    ``NACI'' means National Agency Check with Inquiries, the minimum 
background investigation prescribed by the U.S. Office of Personnel 
Management.
    ``PIV Card'' means the Personal Identity Verification (PIV) 
Card, the Federal Government-issued identification credential 
(identification badge).
    (b) General. The performance of this contract requires 
contractor employees to have access to HUD facilities. All such 
employees who do not already possess a current PIV Card acceptable 
to HUD shall be required to provide personal background information, 
undergo a background investigation (NACI or other OPM-required or 
approved investigation), including an FBI National Criminal History 
Fingerprint Check, and obtain a PIV Card prior to being permitted 
access to any such facility in performance of this contract. HUD may 
accept a PIV Card issued by another Federal Government agency but 
shall not be required to do so. No contractor employee will be 
permitted access to a HUD facility without a proper PIV Card.
    (c) Background information. (1) For each contractor employee 
subject to the requirements of this clause and not in possession of 
a current PIV Card acceptable to HUD, the contractor shall submit 
the following properly completed forms: Standard Form (SF) 85, 
``Questionnaire for Non-sensitive Positions,'' FD 258 (Fingerprint 
Chart), and a partial Optional Form (OF) 306 (Items 1, 2, 6, 8-13, 
16, and 17). The SF-85 and OF-306 are available from the OPM Web 
site, http://www.opm.gov. The GTR will provide all other forms that 
are not obtainable via the Internet.
    (2) The contractor shall deliver the forms and information 
required in subparagraph (c)(1) to the GTR.
    (3) The information provided in accordance with paragraph (c)(1) 
will be used to perform a background investigation to determine the 
suitability of the contractor employees to have access to Government 
facilities. After completion of the investigation, the GTR will 
notify the contractor in writing when any contractor employee is 
determined to be unsuitable for access to a Government facility. The 
contractor shall immediately remove such employee(s) from work on 
this contract that requires physical presence in a Government 
facility.
    (4) Affected contractor employees who have had a federal 
background investigation without a subsequent break in federal 
employment or federal contract service exceeding 2 years may be 
exempt from the investigation requirements of this clause subject to 
verification of the previous investigation. For each such employee, 
the contractor shall submit the following information in lieu of the 
forms and information listed in subparagraph (c)(1): employee's full 
name, Social Security Number, and place and date of birth.
    (d) PIV Cards. (1) HUD will issue a PIV Card to each contractor 
employee who is to be given access to HUD facilities and who does 
not already possess a PIV Card acceptable to HUD (see paragraph 
(b)). HUD will not issue the PIV Card until the contractor employee 
has successfully cleared the FBI National Criminal History 
Fingerprint Check and HUD has initiated the background investigation 
for the contractor employee. Initiation is defined to mean that all 
background information required in paragraph (c)(1) has been 
delivered to HUD. The employee may not be given access prior to 
those two events. HUD may issue a PIV Card and grant access pending 
the completion of the background investigation. HUD will revoke the 
PIV Card and the employee's access if the background investigation 
process (including adjudication of investigation results) for the 
employee has not been completed within 6 months after the issuance 
of the PIV Card.
    (2) PIV Cards shall identify individuals as contractor 
employees. Contractor employees shall display their PIV Cards on 
their persons at all times while working in a HUD facility, and 
shall present cards for inspection upon request by HUD officials or 
HUD security personnel.
    (3) The contractor shall be responsible for all PIV Cards issued 
to the contractor's employees and shall immediately notify the GTR 
if any PIV Card(s) cannot be accounted for. The contractor shall 
promptly return PIV Cards to HUD as required by the FAR clause at 
2.204-9. The contractor shall notify the GTR immediately whenever 
any contractor employee no longer has a need for his/her HUD-issued 
PIV Card (e.g., employee terminates employment with the contractor, 
employee's duties no longer require access to HUD facilities). The 
GTR will instruct the contractor as to how to return the PIV Card. 
Upon expiration of this contract, the GTR will instruct the 
contractor as to how to return all HUD-issued PIV Cards not 
previously returned. Unless otherwise directed by the Contracting 
Officer, the contractor shall not return PIV Cards to any person 
other than the GTR.
    (e) Control of access. HUD shall have, and exercise, complete 
control over granting, denying, withholding, and terminating access 
of contractor employees to HUD facilities. The GTR will notify the 
contractor immediately when HUD has determined that an employee is 
unsuitable or unfit to be permitted access to a HUD facility. The 
contractor shall immediately notify such employee that he/she no 
longer has access to any HUD facility, remove the employee from any 
such facility that he/she may be in, and provide a suitable 
replacement in accordance with the requirements of this clause.
    (f) Access to HUD information systems. If this contract requires 
contractor employees to have access to HUD information system(s), 
application(s), or information contained in such systems, the 
contractor shall comply with all requirements of HUDAR clause 
2452.239-70, Access to HUD Systems, including providing for each 
affected employee any additional background investigation forms 
prescribed in that clause.
    (g) Subcontracts. The contractor shall incorporate this clause 
in all subcontracts where the requirements specified in paragraph 
(b) of this section are applicable to performance of the 
subcontract.

    (End of clause)
    111. In 2452.237-77, revise the section heading and introductory 
text to read as follows:


2452.237-77  Temporary closure of HUD facilities.

    As prescribed in 2437.110(e)(4), insert the following clause:

TEMPORARY CLOSURE OF HUD FACILITIES (* * *)

* * * * *

    112. Revise 2452.239-70 to read as follows:


2452.239-70  Access to HUD systems.

    As prescribed in 2439.107(a), insert the following clause:

ACCESS TO HUD SYSTEMS (* * *)

    (a) Definitions: As used in this clause--
    ``Access'' means the ability to obtain, view, read, modify, 
delete, and/or otherwise make use of information resources.
    ``Application'' means the use of information resources 
(information and information technology) to satisfy a specific set 
of user requirements (see OMB Circular A-130).
    ``Contractor employee'' means an employee of the prime 
contractor or of any subcontractor, affiliate, partner, joint 
venture, or team members with which the contractor is associated. It 
also includes consultants engaged by any of those entities.
    ``Mission-critical system'' means an information technology or

[[Page 15700]]

telecommunications system used or operated by HUD or by a HUD 
contractor, or organization on behalf of HUD, that processes any 
information, the loss, misuse, disclosure, or unauthorized access 
to, or modification of which would have a debilitating impact on the 
mission of the agency.
    ``NACI'' means a National Agency Check with Inquiries, the 
minimum background investigation prescribed by OPM.
    ``PIV Card'' means the Personal Identity Verification (PIV) 
Card, the Federal Government-issued identification credential (i.e., 
identification badge).
    ``Sensitive information'' means any information of which the 
loss, misuse, or unauthorized access to, or modification of, could 
adversely affect the national interest, the conduct of federal 
programs, or the privacy to which individuals are entitled under 
section 552a of title 5, United States Code (the Privacy Act), but 
which has not been specifically authorized under criteria 
established by an Executive Order or an Act of Congress to be kept 
secret in the interest of national defense or foreign policy.
    ``System'' means an interconnected set of information resources 
under the same direct management control, which shares common 
functionality. A system normally includes hardware, software, 
information, data, applications, communications, and people (see OMB 
Circular A-130). System includes any system owned by HUD or owned 
and operated on HUD's behalf by another party.
    (b) General. (1) The performance of this contract requires 
contractor employees to have access to a HUD system or systems. All 
such employees who do not already possess a current PIV Card 
acceptable to HUD shall be required to provide personal background 
information, undergo a background investigation (NACI or other OPM-
required or approved investigation), including an FBI National 
Criminal History Fingerprint Check, and obtain a PIV Card prior to 
being permitted access to any such system in performance of this 
contract. HUD may accept a PIV Card issued by another Federal 
Government agency but shall not be required to do so. No contractor 
employee will be permitted access to any HUD system without a PIV 
Card.
    (2) All contractor employees who require access to mission-
critical systems or sensitive information contained within a HUD 
system or application(s) are required to have a more extensive 
background investigation. The investigation shall be commensurate 
with the risk and security controls involved in managing, using, or 
operating the system or applications(s).
    (c) Citizenship-related requirements. Each affected contractor 
employee as described in paragraph (b) shall be:
    (1) A United States (U.S.) citizen; or,
    (2) A national of the United States (see 8 U.S.C. 1408); or,
    (3) An alien lawfully admitted into, and lawfully permitted to 
be employed in the United States, provided that for any such 
individual, the Government is able to obtain sufficient background 
information to complete the investigation as required by this 
clause. Failure on the part of the contractor to provide sufficient 
information to perform a required investigation or the inability of 
the Government to verify information provided for affected 
contractor employees will result in denial of their access.
    (d) Background investigation process: (1) The Government 
Technical Representative (GTR) shall notify the contractor of those 
contractor employee positions requiring background investigations.
    (i) For each contractor employee requiring access to HUD 
information systems, the contractor shall submit the following 
properly completed forms: Standard Form (SF) 85, ``Questionnaire for 
Non-Sensitive Positions,'' FD 258 (Fingerprint Chart), and a partial 
Optional Form (OF) 306 (Items 1, 2, 6, 8-13, 16, and 17).
    (ii) For each contractor employee requiring access to mission-
critical systems and/or sensitive information contained within a HUD 
system and/or application(s), the contractor shall submit the 
following properly completed forms: SF-85P, ``Questionnaire for 
Public Trust Positions;'' FD 258; and a Fair Credit Reporting Act 
form (authorization for the credit-check portion of the 
investigation). Contractor employees shall not complete the Medical 
Release behind the SF-85P.
    (iii) The SF-85, 85P, and OF-306 are available from OPM's Web 
site, http://www.opm.gov. The GTR will provide all other forms that 
are not obtainable via the Internet.
    (2) The contractor shall deliver the forms and information 
required in subparagraph (d)(1) to the GTR.
    (3) Affected contractor employees who have had a federal 
background investigation without a subsequent break in federal 
employment or federal contract service exceeding 2 years may be 
exempt from the investigation requirements of this clause subject to 
verification of the previous investigation. For each such employee, 
the contractor shall submit the following information in lieu of the 
forms and information listed in subparagraph (d)(1): employee's full 
name, Social Security number, and place and date of birth.
    (4) The investigation process shall consist of a range of 
personal background inquiries and contacts (written and personal) 
and verification of the information provided on the investigative 
forms described in paragraph (d)(1).
    (5) Upon completion of the investigation process, the GTR will 
notify the contractor if any contractor employee is determined to be 
unsuitable to have access to the system(s), application(s), or 
information. Such an employee may not be given access to those 
resources. If any such employee has already been given access 
pending the results of the background investigation, the contractor 
shall ensure that the employee's access is revoked immediately upon 
receipt of the GTR's notification.
    (6) Failure of the GTR to notify the contractor (see paragraph 
(d)(1)) of any employee who should be subject to the requirements of 
this clause and is known, or should reasonably be known, by the 
contractor to be subject to the requirements of this clause, shall 
not excuse the contractor from making such employee(s) known to the 
GTR. Any such employee who is identified and is working under the 
contract, without having had the appropriate background 
investigation or furnished the required forms for the investigation, 
shall cease to perform such work immediately and shall not be given 
access to the system(s)/application(s) described in paragraph (b) 
until the contractor has provided the investigative forms required 
in paragraph (d)(1) for the employee to the GTR.
    (7) The contractor shall notify the GTR in writing whenever a 
contractor employee for whom a background investigation package was 
required and submitted to HUD, or for whom a background 
investigation was completed, terminates employment with the 
contractor or otherwise is no longer performing work under this 
contract that requires access to the system(s), application(s), or 
information. The contractor shall provide a copy of the written 
notice to the Contracting Officer.
    (e) PIV Cards. (1) HUD will issue a PIV Card to each contractor 
employee who is to be given access to HUD systems and does not 
already possess a PIV Card acceptable to HUD (see paragraph (b)). 
HUD will not issue the PIV Card until the contractor employee has 
successfully cleared an FBI National Criminal History Fingerprint 
Check, and HUD has initiated the background investigation for the 
contractor employee. Initiation is defined to mean that all 
background information required in paragraph (d)(1) has been 
delivered to HUD. The employee may not be given access prior to 
those two events. HUD may issue a PIV Card and grant access pending 
the completion of the background investigation. HUD will revoke the 
PIV Card and the employee's access if the background investigation 
process (including adjudication of investigation results) for the 
employee has not been completed within 6 months after the issuance 
of the PIV Card.
    (2) PIV Cards shall identify individuals as contractor 
employees. Contractor employees shall display their PIV Cards on 
their persons at all times while working in a HUD facility, and 
shall present cards for inspection upon request by HUD officials or 
HUD security personnel.
    (3) The contractor shall be responsible for all PIV Cards issued 
to the contractor's employees and shall immediately notify the GTR 
if any PIV Card(s) cannot be accounted for. The contractor shall 
promptly return PIV Cards to HUD as required by the FAR clause at 
52.204-9. The contractor shall notify the GTR immediately whenever 
any contractor employee no longer has a need for his/her HUD-issued 
PIV Card (e.g., the employee terminates employment with the 
contractor, the employee's duties no longer require access to HUD 
systems). The GTR will instruct the contractor as to how to return 
the PIV Card. Upon expiration of this contract, the GTR will 
instruct the contractor as to how to return all HUD-issued PIV Cards 
not previously returned. Unless otherwise directed by the 
Contracting Officer, the contractor shall not return PIV Cards to 
any person other than the GTR.
    (f) Control of access. HUD shall have and exercise full and 
complete control over

[[Page 15701]]

granting, denying, withholding, and terminating access of contractor 
employees to HUD systems. The GTR will notify the contractor 
immediately when HUD has determined that an employee is unsuitable 
or unfit to be permitted access to a HUD system. The contractor 
shall immediately notify such employee that he/she no longer has 
access to any HUD system, physically retrieve the employee's PIV 
Card from the employee, and provide a suitable replacement employee 
in accordance with the requirements of this clause.
    (g) Incident response notification. An incident is defined as an 
event, either accidental or deliberate, that results in unauthorized 
access, loss, disclosure, modification, or destruction of 
information technology systems, applications, or data. The 
contractor shall immediately notify the GTR and the Contracting 
Officer of any known or suspected incident, or any unauthorized 
disclosure of the information contained in the system(s) to which 
the contractor has access.
    (h) Nondisclosure of information. (1) Neither the contractor nor 
any of its employees shall divulge or release data or information 
developed or obtained during performance of this contract, except to 
authorized government personnel with an established need to know, or 
upon written approval of the Contracting Officer. Information 
contained in all source documents and other media provided by HUD is 
the sole property of HUD.
    (2) The contractor shall require that all employees who may have 
access to the system(s)/applications(s) identified in paragraph (b) 
sign a pledge of nondisclosure of information. The employees shall 
sign these pledges before they are permitted to perform work under 
this contract. The contractor shall maintain the signed pledges for 
a period of 3 years after final payment under this contract. The 
contractor shall provide a copy of these pledges to the GTR.
    (i) Security procedures. (1) The Contractor shall comply with 
applicable federal and HUD statutes, regulations, policies, and 
procedures governing the security of the system(s) to which the 
contractor's employees have access including, but not limited to:
    (i) The Federal Information Security Management Act (FISMA) of 
2002;
    (ii) OMB Circular A-130, Management of Federal Information 
Resources, Appendix III, Security of Federal Automated Information 
Resources;
    (iii) HUD Handbook 2400.25, Information Technology Security 
Policy;
    (iv) HUD Handbook 732.3, Personnel Security/Suitability;
    (v) Federal Information Processing Standards 201 (FIPS 201), 
Sections 2.1 and 2.2;
    (vi) Homeland Security Presidential Directive 12 (HSPD-12); and
    (vii) OMB Memorandum M-05-24, Implementing Guidance for HSPD-12.
    The HUD Handbooks are available online at: http://www.hud.gov/offices/adm/hudclips/ or from the GTR.
    (2) The contractor shall develop and maintain a compliance 
matrix that lists each requirement set forth in paragraphs, (b), 
(c), (d), (e), (f), (g), (h), (i)(1), and (m) of this clause with 
specific actions taken, and/or procedures implemented, to satisfy 
each requirement. The contractor shall identify an accountable 
person for each requirement, the date upon which actions/procedures 
were initiated/completed, and certify that information contained in 
this compliance matrix is correct. The contractor shall ensure that 
information in this compliance matrix is complete, accurate, and up-
to-date at all times for the duration of this contract. Upon 
request, the contractor shall provide copies of the current matrix 
to HUD.
    (3) The Contractor shall ensure that its employees, in 
performance of the contract, receive annual training (or once if the 
contract is for less than one year) in HUD information technology 
security policies, procedures, computer ethics, and best practices 
in accordance with HUD Handbook 2400.25.
    (j) Access to contractor's systems. The Contractor shall afford 
HUD, including the Office of Inspector General, access to the 
Contractor's facilities, installations, operations, documentation 
(including the compliance matrix required under paragraph (i)(2)), 
databases, and personnel used in performance of the contract. Access 
shall be provided to the extent required to carry out, but not 
limited to, any information security program activities, 
investigation, and audit to safeguard against threats and hazards to 
the integrity, availability, and confidentiality of HUD data and 
systems, or to the function of information systems operated on 
behalf of HUD, and to preserve evidence of computer crime.
    (k) Contractor compliance with this clause. Failure on the part 
of the contractor to comply with the terms of this clause may result 
in termination of this contract for default.
    (l) Physical access to Federal Government facilities. The 
contractor and any subcontractor(s) shall also comply with the 
requirements of HUDAR clause 2452.237 75 when the contractor's or 
subcontractor's employees will perform any work under this contract 
on site in a HUD or other Federal Government facility.
    (m) Subcontracts. The contractor shall incorporate this clause 
in all subcontracts where the requirements specified in paragraph 
(b) of this section are applicable to performance of the 
subcontract.

    (End of clause)

    Dated: February 10, 2012.
Jemine A. Bryon,
Chief Procurement Officer.
[FR Doc. 2012-6165 Filed 3-15-12; 8:45 am]
BILLING CODE 4210-67-P`