Federal Register / Vol. 81, No. 98 / Friday, May 20, 2016 / Rules and Regulations 31865 

ENVIRONMENTAL PROTECTION 

AGENCY 

48 CFR Parts 1511 and 1552 

[EPA–HQ–OARM–2012–0478; FRL 9946–47– 

OARM] 

Environmental Protection Agency 

Acquisition Regulation; Clause for 

Level of Effort—Cost-Reimbursement 

Contract 

AGENCY: Environmental Protection 

Agency (EPA). 

ACTION: Final rule. 

SUMMARY: The Environmental Protection 

Agency (EPA) amends the EPA 

Acquisition Regulation (EPAAR) to 

update policy, procedures, and contract 

clauses. This final rule updates the 

EPAAR clause Level of Effort—CostReimbursement Contract. 

DATES: This final rule is effective on 

June 20, 2016. 

ADDRESSES: The EPA has established a 

docket for this action under Docket ID 

No. EPA–HQ–OARM–2012–0478. All 

documents in the docket are listed on 

the http://www.regulations.gov Web 

site. Although listed in the index, some 

information is not publicly available, 

e.g., CBI or other information whose 

disclosure is restricted by statute. 

Certain other material, such as 

copyrighted material, is not placed on 

the Internet and will be publicly 

available only in hard copy form. 

Publicly available docket materials are 

available electronically through http://

www.regulations.gov, or in hard copy at 

the Office of Environmental Information 

(OEI) Docket, EPA/DC, EPA West, Room 

3334, 1301 Constitution Ave. NW., 

Washington, DC. The Public Reading 

Room is open from 8:30 a.m. to 4:30 

p.m., Monday through Friday, excluding 

legal holidays. The telephone number 

for the Public Reading Room is (202) 

566–1744, and the telephone number for 

the EPA Docket Center is (202) 566– 

1752. This Docket Facility is open from 

8:30 a.m. to 4:30 p.m. Monday through 

Friday, excluding legal holidays. 

FOR FURTHER INFORMATION CONTACT: 

Thomas Valentino, Policy, Training, and 

Oversight Division, Office of 

Acquisition Management (3802R), 

Environmental Protection Agency, 1200 

Pennsylvania Ave. NW., Washington, 

DC 20460; telephone number: 202–564– 

4522; email address: valentino.thomas@

epa.gov. 

SUPPLEMENTARY INFORMATION: 

I. Background 

The EPA reviewed EPAAR clause 

1552.211–73, Level of Effort—CostReimbursement Term Contract, to make 

the clause more prescriptive in 

describing the EPA’s responsibilities 

when the Agency orders less level of 

effort (LOE) than the maximum LOE 

specified in the subject clause; e.g., if 

the clause specifies 100,000 hours for a 

given period of performance but the 

contractor only provides 70,000 hours. 

The clause provides that a downward 

equitable adjustment will be made to 

reduce the fixed fee by the percentage 

by which the total expended LOE is less 

than 100% of that specified in the LOE 

clause; e.g., the fixed fee amount will be 

reduced by 30% using the same 

100,000/70,000 hours example. The 

clause title is also modified so that the 

clause is now applicable to EPA LOE 

cost-reimbursement contracts, and 

paragraph (a) has been revised. The 

EPAAR 1511.011–73 clause prescription 

is also being updated accordingly. On 

April 10, 2015 (80 FR 19257) EPA 

sought comments on the proposed rule 

and received no comments. 

II. Final Rule 

This final rule amends the EPAAR to 

revise the following: 

1. The EPAAR 1511.011–73 clause 

prescription is updated. 

2. The clause title is revised as 

follows: Level of Effort—CostReimbursement Contract. 

3. Paragraph (a) has been revised. 

4. An expositional statement has been 

added to paragraph (c). 

III. Statutory and Executive Order 

Reviews 

A. Executive Order 12866: Regulatory 

Planning and Review 

This action is not a ‘‘significant 

regulatory action’’ under the terms of 

Executive Order (EO)12866 (58 FR 

51735, October 4, 1993) and therefore, 

not subject to review under the EO. 

B. Paperwork Reduction Act 

This action does not impose an 

information collection burden under the 

provisions of the Paperwork Reduction 

Act, 44 U.S.C. 3501 et seq. No 

information is collected under this 

action. 

C. Regulatory Flexibility Act (RFA), as 

Amended by the Small Business 

Regulatory Enforcement Fairness Act of 

1996 (SBREFA), 5 U.S.C. 601 et seq. 

The Regulatory Flexibility Act 

generally requires an agency to prepare 

a regulatory flexibility analysis of any 

rule subject to notice and comment 

rulemaking requirements under the 

Administrative Procedure Act or any 

other statute; unless the agency certifies 

that the rule will not have a significant 

economic impact on a substantial 

number of small entities. Small entities 

include small businesses, small 

organizations, and small governmental 

jurisdictions. 

For purposes of assessing the impact 

of this final rule on small entities, 

‘‘small entity’’ is defined as: (1) A small 

business that meets the definition of a 

small business found in the Small 

Business Act and codified at 13 CFR 

121.201; (2) a small governmental 

jurisdiction that is a government of a 

city, county, town, school district or 

special district with a population of less 

than 50,000; and (3) a small 

organization that is any not-for-profit 

enterprise which is independently 

owned and operated and is not 

dominant in its field. 

After considering the economic 

impacts of this rule on small entities, I 

certify that this action will not have a 

significant economic impact on a 

substantial number of small entities. 

This action revises a current EPAAR 

provision and does not impose 

requirements involving capital 

investment, implementing procedures, 

or record keeping. This rule will not 

have a significant economic impact on 

small entities. 

D. Unfunded Mandates Reform Act 

Title II of the Unfunded Mandates 

Reform Act of 1995 (UMRA), Public 

Law 104–4, 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 contains no Federal 

mandates (under the regulatory 

provisions of the Title II of the UMRA) 

for State, Local, and Tribal governments 

or the private sector. The rule imposes 

no enforceable duty on any State, Local 

or Tribal governments or the private 

sector. Thus, the rule is not subject to 

the requirements of Sections 202 and 

205 of the UMRA. 

E. Executive Order 13132: Federalism 

Executive Order 13132, entitled 

‘‘Federalism’’ (64 FR 43255, August 10, 

1999), requires EPA to develop an 

accountable process to ensure 

‘‘meaningful and timely input by State 

and Local officials in the development 

of regulatory policies that have 

federalism implications.’’ ‘‘Policies that 

have federalism implications’’ is 

defined in the Executive Order to 

include regulations that have 

‘‘substantial direct effects on the States, 

on the relationship between the national 

government and the States, or on the 

distribution of power and 

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31866 Federal Register / Vol. 81, No. 98 / Friday, May 20, 2016 / Rules and Regulations 

responsibilities among the various 

levels of government.’’ 

This rule does not have federalism 

implications. It will not have substantial 

direct effects on the States, on the 

relationship between the national 

government and the States, or on the 

distribution of power and 

responsibilities among the various 

levels of government as specified in 

Executive Order 13132. 

F. Executive Order 13175: Consultation 

and Coordination With Indian Tribal 

Governments 

Executive Order 13175, entitled 

‘‘Consultation and Coordination with 

Indian Tribal Governments’’ (65 FR 

67249, November 9, 2000), requires EPA 

to develop an accountable process to 

ensure ‘‘meaningful and timely input by 

tribal officials in the development of 

regulatory policies that have tribal 

implications.’’ This rule does not have 

tribal implications as specified in 

Executive Order 13175. 

G. Executive Order 13045: Protection of 

Children From Environmental Health 

and Safety Risks 

Executive Order 13045, entitled 

‘‘Protection of Children from 

Environmental Health and Safety Risks’’ 

(62 FR 19885, April 23, 1997), applies 

to any rule that: (1) Is determined to be 

economically significant as defined 

under Executive Order 12886, and (2) 

concerns an environmental health or 

safety risk that may have a 

proportionate effect on children. This 

rule is not subject to Executive Order 

13045 because it is not an economically 

significant rule as defined by Executive 

Order 12866, and because it does not 

involve decisions on environmental 

health or safety risks. 

H. Executive Order 13211: Actions That 

Significantly Affect Energy Supply, 

Distribution, or Use 

This final rule is not subject to 

Executive Order 13211, ‘‘Actions 

Concerning Regulations That 

Significantly Affect Energy Supply, 

Distribution of Use’’ (66 FR 28335, (May 

22, 2001), because it is not a significant 

regulatory action under Executive Order 

12866. 

I. National Technology Transfer and 

Advancement Act of 1995 (NTTAA) 

Section 12(d) (15 U.S.C 272 note) of 

NTTA, Public Law 104–113, directs 

EPA to use voluntary consensus 

standards in its regulatory activities 

unless to do so would be inconsistent 

with applicable law or otherwise 

impractical. Voluntary consensus 

standards are technical standards (e.g., 

materials specifications, test methods, 

sampling procedures and business 

practices) that are developed or adopted 

by voluntary consensus standards 

bodies. The NTTA directs EPA to 

provide Congress, through OMB, 

explanations when the Agency decides 

not to use available and applicable 

voluntary consensus standards. 

This rulemaking does not involve 

technical standards. Therefore, EPA is 

not considering the use of any voluntary 

consensus standards. 

J. Executive Order 12898: Federal 

Actions To Address Environmental 

Justice in Minority Populations and 

Low-Income Populations 

Executive Order (E.O.) 12898 (59 FR 

7629 (Feb. 16, 1994) establishes federal 

executive policy on environmental 

justice. Its main provision directs 

federal agencies, to the greatest extent 

practicable and permitted by law, to 

make environmental justice part of their 

mission by identifying and addressing, 

as appropriate, disproportionately high 

and adverse human health or 

environmental effects of their programs, 

policies, and activities on minority 

populations and low-income 

populations in the United States. 

EPA has determined that this final 

rule will not have disproportionately 

high and adverse human health or 

environmental effects on minority or 

low-income populations because it does 

not affect the level of protection 

provided to human health or the 

environment. This rulemaking does not 

involve human health or environmental 

effects. 

List of Subjects 

48 CFR Part 1511 

Government procurement. 

48 CFR Part 1552 

Government procurement, Reporting 

and recordkeeping requirements. 

Dated: May 5, 2016. 

John R. Bashista, 

Director, Office of Acquisition Management. 

Therefore, 48 CFR Chapter 15 is 

amended as set forth below: 

PART 1511—DESCRIBING AGENCY 

NEEDS 

■ 1. The authority citation for part 1511 

continues to read as follows: 

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

amended, 40 U.S.C. 486(c) 

■ 2. Revise section 1511.011–73 to read 

as follows: 

1511.011–73 Level of effort. 

The Contracting Officer shall insert 

the clause at 1552.211–73, Level of 

Effort—Cost Reimbursement Contract, 

in cost-reimbursement contracts 

including cost contracts without fee, 

cost-sharing contracts, cost-plus-fixedfee (CPFF) contracts, cost-plusincentive-fee contracts (CPIF), and costplus-award-fee contracts (CPAF). 

PART 1552—SOLICITATION 

PROVISIONS AND CONTRACT 

CLAUSES 

■ 3. The authority citation for part 1552 

continues to read as follows: 

Authority: 5 U.S.C. 301 and 41 U.S.C. 

418b. 

■ 4. Revise section 1552.211–73 to read 

as follows: 

1552.211–73 Level of effort—costreimbursement contract. 

As prescribed in 1511.011–73, the 

contracting officer shall insert the 

following contract clause in costreimbursement contracts including cost 

contracts without fee, cost-sharing 

contracts, cost-plus-fixed-fee (CPFF) 

contracts, cost-plus-incentive-fee 

contracts (CPIF), and cost-plus-awardfee contracts (CPAF). 

Level of Effort—Cost-Reimbursement 

Contract (May 2016) 

(a) The Contractor shall perform all work 

and provide all required reports within the 

level of effort specified below. The 

Contractor shall provide up to ____ direct 

labor hours for the base period. The 

Government’s best estimate of the level of 

effort to fulfill these requirements is provided 

for advisory and estimating purposes. The 

Government is only obligated to pay for 

direct labor hours ordered and corresponding 

fixed fee for labor hours completed. 

(b) Direct labor includes personnel such as 

engineers, scientists, draftsmen, technicians, 

statisticians, and programmers, and not 

support personnel such as company 

management or data entry/word processing/ 

accounting personnel even though such 

support personnel are normally treated as 

direct labor by the Contractor. The level of 

effort specified in paragraph (a) of this 

section includes Contractor, subcontractor, 

and consultant non-support labor hours. 

(c) If the Contractor provides less than 90 

percent of the level of effort specified for the 

base period or any optional period exercised, 

an equitable downward adjustment of the 

fixed fee, if any, for that period will be made. 

The downward adjustment will reduce the 

fixed fee by the percentage by which the total 

expended level of effort is less than 100% of 

that specified in paragraph (a). (For instance, 

if a hypothetical base-period LOE of 100,000 

hours is being reduced to 70,000, the fixed 

fee shall also be reduced by the same 30%. 

Using a corresponding hypothetical baseperiod fixed fee pool of $300,000, the 

reduced fixed-fee amount is calculated as: 

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Federal Register / Vol. 81, No. 98 / Friday, May 20, 2016 / Rules and Regulations 31867 

$300,000 × (70,000 hours/100,000 hours) = 

$210,000.) 

(d) The Government may require the 

Contractor to provide additional effort up to 

110 percent of the level of effort for any 

period until the estimated cost for that period 

has been reached. However, this additional 

effort shall not result in any increase in the 

fixed fee, if any. 

(e) If this is a cost-plus-incentive-fee (CPIF) 

contract, the term ‘‘fee’’ in paragraphs (c) and 

(d) of this section means ‘‘base fee and 

incentive fee.’’ If this is a cost-plus-award-fee 

(CPAF) contract, the term ‘‘fee’’ in paragraphs 

(c) and (d) means ‘‘base fee and award fee.’’ 

(f) If the level of effort specified to be 

ordered during a given base or option period 

is not ordered during that period, that level 

of effort may not be accumulated and ordered 

during a subsequent period. 

(g) These terms and conditions do not 

supersede the requirements of either the 

‘‘Limitation of Cost’’ or ‘‘Limitation of 

Funds’’ clauses. 

(End of clause) 

[FR Doc. 2016–11970 Filed 5–19–16; 8:45 am] 

BILLING CODE 6560–50–P 

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