16718 Federal Register / Vol. 60, No. 62 / Friday, March 31, 1995 / Rules and Regulations

DEPARTMENT OF DEFENSE

GENERAL SERVICES

ADMINISTRATION

NATIONAL AERONAUTICS AND

SPACE ADMINISTRATION

48 CFR Parts 9, 15, and 42

[FAC 90–26; FAR Case 93–02]

RIN 9000–AG45

Federal Acquisition Regulation; Past

Performance Information

AGENCIES: Department of Defense (DOD),

General Services Administration (GSA),

and National Aeronautics and Space

Administration (NASA).

ACTION: Final rule.

SUMMARY: The Civilian Agency

Acquisition Council and the Defense

Acquisition Regulations Council have

agreed to issue Federal Acquisition

Circular (FAC) 90–26, a final rule

amending the Federal Acquisition

Regulation (FAR) to establish

requirements for the use of past

performance information in the

contractor selection process. This

regulatory action was subject to Office

of Management and Budget review

under Executive Order 12866, dated

September 30, 1993.

EFFECTIVE DATE: May 30, 1995.

FOR FURTHER INFORMATION CONTACT:

Ms. Linda Klein at (202) 501–3775 in

reference to this FAR case. For general

information, contact the FAR

Secretariat, Room 4037, GS Building,

Washington, DC 20405 (202) 501–4755.

Please cite FAC 90–26, FAR case 93–02.

SUPPLEMENTARY INFORMATION:

A. Background

A proposed FAR rule was published

in the Federal Register at 59 FR 8108 on

February 17, 1994. The proposed rule

required evaluation of past performance

in all competitively negotiated

acquisitions expected to exceed

$100,000, and evaluation of contractor

performance on all new contracts

exceeding $100,000.

Thirty-five comments from twentyfive sources were received during the

public comment period. All comments

were considered in the development of

this final rule. The final rule differs

from the proposed rule in that it (1)

permits agencies to use a phase-in

approach for implementation of past

performance evaluation requirements;

(2) clarifies that firms lacking relevant

performance history shall receive a

neutral evaluation for past performance;

(3) permits offerors to submit relevant

past performance information to the

Government; (4) excludes contracts

awarded under FAR Subparts 8.6 and

8.7 from the requirement for evaluation

of contractor performance; (5) provides

that past performance information files

shall not be retained to provide source

selection information for longer than

three years after completion of contract

performance; and (6) contains

additional guidance to facilitate the

collection and use of past performance

information.

B. Regulatory Flexibility Act

The Regulatory Flexibility Act (5

U.S.C. 601, et seq.) applies to this final

rule and a Final Regulatory Flexibility

Analysis has been performed. A copy of

the analysis may be obtained from the

FAR Secretariat.

C. Paperwork Reduction Act

The Paperwork Reduction Act does

not apply because the final rule does not

impose recordkeeping or information

collection requirements which require

the approval of the Office of

Management and Budget under 44

U.S.C. 3501, et seq.

List of Subjects in 48 CFR Parts 9, 15,

and 42

Government procurement.

Dated: March 27, 1995.

C. Allen Olson,

Director, Office of Federal Acquisition Policy.

Federal Acquisition Circular

FAC 90–26

Federal Acquistion Circular (FAC)

90–26 is issued under the authority of

the Secretary of Defense, the

Administrator of General Services, and

the Administrator for the National

Aeronautics and Space Administration.

All Federal Acquisition Regulation

(FAR) and other directive material

contained in FAC 90–26 are effective

May 30, 1995.

Dated: February 27, 1995.

Eleanor R. Spector,

Director, Defense Procurement.

Dated: February 2, 1995.

Deidre A. Lee,

Associate Administrator for Procurement,

NASA.

Ida M. Ustad,

Associate Administrator, Office of

Acquisition Policy, GSA.

Therefore, 48 CFR Parts 9, 15, and 42

are amended as set forth below:

1. The authority citation for 48 CFR

Parts 9, 15 and 42 continues to read as

follows:

Authority: 40 U.S.C. 486(c); 10 U.S.C.

chapter 137; and 42 U.S.C. 2473(c).

PART 9—CONTRACTOR

QUALIFICATIONS

2. Section 9.104–1(c) is revised to

read as follows:

9.104–1 General standards.

* * * * *

(c) Have a satisfactory performance

record (see 48 CFR 9.104–3(c) and part

42, subpart 42.15). A prospective

contractor shall not be determined

responsible or nonresponsible solely on

the basis of a lack of relevant

performance history, except as provided

in 9.104–2;

* * * * *

3. Section 9.105–1(c) is amended by

revising the introductory text to read as

follows:

9.105–1 Obtaining information.

* * * * *

(c) In making the determination of

responsibility (see 9.104–1(c)), the

contracting officer shall consider

relevant past performance information

(see 48 CFR part 42, subpart 42.15). In

addition, the contracting officer should

use the following sources of information

to support such determinations:

* * * * *

PART 15—CONTRACTING BY

NEGOTIATION

4. Section 15.406–5(b) is amended by

revising the last two sentences to read

as follows:

15.406–5 Part IV—Representations and

instructions.

* * * * *

(b) * * * The severable parts should

provide for separation of cost or pricing

data, past performance data and, when

needed, technical data. The instructions

may specify further organization of

proposal or quotation parts, such as (1)

administrative, (2) management, (3)

technical, (4) past performance, and (5)

cost or pricing data.

* * * * *

5. Section 15.604 is amended by

revising paragraphs (b) and (c)(3) to read

as follows:

15.604 Responsibilities.

* * * * *

(b) The cognizant technical official is

responsible for the technical and past

performance requirements related to the

source selection process.

(c) * * *

(3) Conducting or controlling all

negotiations concerning cost or price,

technical requirements, past
Federal Register / Vol. 60, No. 62 / Friday, March 31, 1995 / Rules and Regulations 16719

performance, and other terms and

conditions; and

* * * * *

6. Section 15.605 is amended by

revising paragraph (b), removing

paragraph (c), redesignating (d), (e) and

(f) as (c), (d) and (e), respectively, and

revising newly-redesignated (d) to read

as follows:

15.605 Evaluation factors.

* * * * *

(b)(1) The evaluation factors that

apply to an acquisition and the relative

importance of those factors are within

the broad discretion of agency

acquisition officials except that—

(i) Price or cost to the Government

shall be included as an evaluation factor

in every source selection.

(ii) Past performance shall be

evaluated in all competitively

negotiated acquisitions expected to

exceed $100,000 not later than January

1, 1999, unless the contracting officer

documents in the contract file the

reasons why past performance should

not be evaluated. Agencies may develop

their own phase-in schedule for past

performance evaluations which meets or

exceeds the following milestones: All

solicitations with an estimated value in

excess of (A) $1,000,000 issued on or

after July 1, 1995; (B) $500,000 issued

on or after July 1, 1997; and (C)

$100,000 issued on or after January 1,

1999. Past performance may be

evaluated in competitively negotiated

acquisitions estimated at $100,000 or

less at the discretion of the contracting

officer.

(iii) Quality shall be addressed in

every source selection through inclusion

in one or more of the non-cost

evaluation factors, such as past

performance, technical excellence,

management capability, personnel

qualifications, prior experience, and

schedule compliance.

(2) Any other relevant factors, such as

cost realism, may also be included.

* * * * *

(d) The solicitation should be

structured to provide for the selection of

the source whose proposal offers the

greatest value to the Government in

terms of performance, risk management,

cost or price, and other factors. The

solicitation shall clearly state the

evaluation factors, including cost or

price, cost or price-related factors, past

performance and other non-cost or nonprice-related factors, and any significant

subfactors, that will be considered in

making the source selection, and their

relative importance (see 15.406–5(c)).

Numerical weights, which may be

employed in the evaluation of

proposals, need not be disclosed in

solicitations. The solicitation shall

inform offerors of minimum

requirements that apply to particular

evaluation factors and significant

subfactors.

* * * * *

7. Section 15.608(a) is amended by

revising the introductory text,

redesignating paragraph (a)(2) as (a)(3),

and adding a new paragraph (a)(2) to

read as follows:

15.608 Proposal evaluation.

(a) Proposal evaluation is an

assessment of both the proposal and the

offeror’s ability to successfully

accomplish the prospective contract. An

agency shall evaluate competitive

proposals solely on the factors specified

in the solicitation.

* * * * *

(2) Past performance evaluation. (i)

Past performance information is an

indicator of an offeror’s ability to

perform the contract. The comparative

assessment of past performance

information is separate from the

responsibility determination required

under 48 CFR 9.103. The number and

severity of an offeror’s problems, the

effectiveness of corrective actions taken,

the offeror’s overall work record, and

the age and relevance of past

performance information should be

considered at the time it is used.

(ii) Where past performance is to be

evaluated, the solicitation shall afford

offerors the opportunity to identify

Federal, state and local government, and

private contracts performed by the

offerors that were similar in nature to

the contract being evaluated, so that the

Government may verify the offerors’

past performance on these contracts. In

addition, at the discretion of the

contracting officer, the offerors may

provide information on problems

encountered on the identified contracts

and the offerors’ corrective actions. Past

performance information may also be

obtained from other sources known to

the Government. The source and type of

past performance information to be

included in the evaluation is within the

broad discretion of agency acquisition

officials and should be tailored to the

circumstances of each acquisition.

Evaluations of contractor performance

prepared in accordance with 48 CFR

part 42, subpart 42.15 are one source of

performance information which may be

used.

(iii) Firms lacking relevant past

performance history shall receive a

neutral evaluation for past performance.

* * * * *

8. Section 15.610 is amended by

removing the word ‘‘and’’ at the end of

paragraph (c)(4) and the period at the

end of (c)(5) and inserting ‘‘; and’’ in its

place; and by adding paragraph (c)(6) to

read as follows:

15.610 Written or oral discussion.

* * * * *

(c) * * *

(6) Provide the offeror an opportunity

to discuss past performance information

obtained from references on which the

offeror had not had a previous

opportunity to comment. Names of

individuals providing reference

information about an offeror’s past

performance shall not be disclosed.

* * * * *

9. Section 15.1003(b) is amended by

removing the word ‘‘and’’ at the end of

paragraph (b)(2) and the period at the

end of (b)(3) and inserting ‘‘; and’’ in its

place; and by adding paragraph (b)(4) to

read as follows:

15.1003 Debriefing of unsuccessful

offerors.

* * * * *

(b) * * *

(4) Names of individuals providing

reference information about an offeror’s

past performance.

* * * * *

PART 42—CONTRACT

ADMINISTRATION

10. Section 42.302 is amended by

adding paragraph (b)(11) to read as

follows:

42.302 Contract administration functions.

* * * * *

(b) * * *

(11) Prepare evaluations of contractor

performance in accordance with subpart

42.15.

* * * * *

11. Subpart 42.15 is added to read as

follows:

Subpart 42.15—Contractor Performance

Information

Sec.

42.1500 Scope of subpart.

42.1501 General.

42.1502 Policy.

42.1503 Procedures.

42.1500 Scope of subpart.

This subpart provides policies and

establishes responsibilities for recording

and maintaining contractor performance

information. It implements Office of

Federal Procurement Policy Letter 92–5,

Past Performance Information. This

subpart does not apply to procedures

used by agencies in determining fees

under award or incentive fee contracts.
16720 Federal Register / Vol. 60, No. 62 / Friday, March 31, 1995 / Rules and Regulations

However, the fee amount paid to

contractors should be reflective of the

contractor’s performance and the past

performance evaluation should closely

parallel the fee determinations.

42.1501 General.

Past performance information is

relevant information, for future source

selection purposes, regarding a

contractor’s actions under previously

awarded contracts. It includes, for

example, the contractor’s record of

conforming to contract requirements

and to standards of good workmanship;

the contractor’s record of forecasting

and controlling costs; the contractor’s

adherence to contract schedules,

including the administrative aspects of

performance; the contractor’s history of

reasonable and cooperative behavior

and commitment to customer

satisfaction; and generally, the

contractor’s business-like concern for

the interest of the customer.

42.1502 Policy.

(a) Except as provided in paragraph

(b) of this section, agencies shall prepare

an evaluation of contractor performance

for each contract in excess of $1,000,000

beginning July 1, 1995, $500,000

beginning July 1, 1996, and $100,000

beginning January 1, 1998, (regardless of

the date of contract award) at the time

the work under the contract is

completed. In addition, interim

evaluations should be prepared as

specified by the agencies to provide

current information for source selection

purposes, for contracts with a period of

performance, including options,

exceeding one year. This evaluation is

generally for the entity, division, or unit

that performed the contract. The content

and format of performance evaluations

shall be established in accordance with

agency procedures and should be

tailored to the size, content, and

complexity of the contractual

requirements.

(b) Agencies shall not evaluate

performance for contracts awarded

under 48 CFR part 8, subparts 8.6 and

8.7. Agencies shall evaluate

construction contractor performance

and architect/engineer contractor

performance in accordance with 48 CFR

36.201 and 36.604, respectively.

42.1503 Procedures.

(a) Agency procedures for the past

performance evaluation system shall

generally provide for input to the

evaluations from the technical office,

contracting office and, where

appropriate, end users of the product or

service.

(b) Agency evaluations of contractor

performance prepared under this

subpart shall be provided to the

contractor as soon as practicable after

completion of the evaluation.

Contractors shall be given a minimum of

30 days to submit comments, rebutting

statements, or additional information.

Agencies shall provide for review at a

level above the contracting officer to

consider disagreements between the

parties regarding the evaluation. The

ultimate conclusion on the performance

evaluation is a decision of the

contracting agency. Copies of the

evaluation, contractor response, and

review comments, if any, shall be

retained as part of the evaluation. These

evaluations may be used to support

future award decisions, and should

therefore be marked ‘‘Source Selection

Information’’. The completed evaluation

shall not be released to other than

Government personnel and the

contractor whose performance is being

evaluated during the period the

information may be used to provide

source selection information. Disclosure

of such information could cause harm

both to the commercial interest of the

Government and to the competitive

position of the contractor being

evaluated as well as impede the

efficiency of Government operations.

Evaluations used in determining award

or incentive fee payments may also be

used to satisfy the requirements of this

subpart.

(c) Departments and agencies shall

share past performance information

with other departments and agencies

when requested to support future award

decisions. The information may be

provided through interview and/or by

sending the evaluation and comment

documents to the requesting source

selection official.

(d) Any past performance information

systems, including automated systems,

used for maintaining contractor

performance information and/or

evaluations should include appropriate

management and technical controls to

ensure that only authorized personnel

have access to the data.

(e) The past performance information

shall not be retained to provide source

selection information for longer than

three years after completion of contract

performance.

[FR Doc. 95–7827 Filed 3–30–95; 8:45 am]

BILLING CODE 6820–34D–P