Federal Register / Vol. 60, No. 60 / Wednesday, March 29, 1995 / Rules and Regulations 16063

NASA Office of the Inspector General

(OIG) by means of a transmittal

memorandum. A transmittal

memorandum is sent by the OIG to the

procurement officer of each NASA field

installation having an award (contract,

grant, or other agreement) covered by

the audit report. The transmittal

memorandum will identify whether

there were any audit findings.

(d) (1) Chapter 6 of the NASA Audit

Followup Handbook identifies which

contract audit reports are reportable

semiannually to Code HC.

(2) Only trackable A–128 and A–133

audit reports involving the following

shall be reported semiannually to Code

HC—

(i) A significant management control

issue; or

(ii) For an individual NASA award,

either the lower of 10 percent or $10,000

of the costs incurred in the period

covered by the audit are questioned; or

for institution-wide issues, the lower of

10 percent or $10,000 of the total costs

incurred involving Government funds

for the period covered by the audit are

questioned.

(e) (1) The resolution and disposition

of contract audits is covered by Chapter

6 of the NASA Audit Followup

Handbook.

(2) The resolution and disposition of

A–128 and A–133 are handled as

follows:

(i) Audit findings pertaining to an

individual NASA award are the

responsiblility of the procurement

officer administering that award.

(ii) Audit findings having an

institution-wide impact are the

responsibility of the cognizant Federal

agency. OMB’s January 6, 1986, Federal

Register Notice (51 FR 552), titled

‘‘Federal Agencies Responsible for Cost

Negotiation and Audit of State and

Local Governments,’’ provides

cognizant agency assignments for OMB

Circular A–128. For organizations

subject to OMB Circular A–133, the

cognizant agency is either assigned

pursuant to OMB Circular A–88,

‘‘Indirect Cost Rates, Audit, and Audit

Followup at Educational Institutions,’’

or if not formally assigned, it is based

on which Federal agency provided the

largest amount of funds for the audited

period. In such cases where NASA is

the cognizant Federal agency, audit

resolution and disposition is the

responsibility of the procurement officer

for the ‘‘cognizant field installation,’’

i.e., the field installation having the

largest total award dollar amount for the

audited period. A copy of the

memorandum dispositioning the

findings shall be provided by each field

installation having resolution

responsibility for the particular report to

the OIG Center office within whose

geographic area of responsibility the

audited organization is located.

PART 1845—GOVERNMENT

PROPERTY

1845.106–70 [Amended]

31. In section 1845.106–70, paragraph

(e), ‘‘Supply and Equipment

Management Office (Code JLE)’’ is

revised to read ‘‘Logistics Management

Office (Code JLG)’’.

1845.405 [Amended]

32. In section 1845.405, paragraph (b),

‘‘Supply and Equipment Management

Office (Code JLE)’’ is revised to read

‘‘Logistics Management Office (Code

JLG)’’ and ‘‘Code IRD’’ is revised to read

‘‘Code IR’’.

1845.407 [Amended]

33. In section 1845.407, paragraph (a),

‘‘Supply and Equipment Management

Office (Code JLE)’’ is revised to read

‘‘Logistics Management Office (Code

JLG)’’.

1845.608–6 [Amended]

34. In section 1845.608–6, ‘‘Supply

and Equipment Management Office

(Code JLE)’’ is revised to read ‘‘Logistics

Management Office (Code JLG)’’.

1845.610–2 [Amended]

35. In section 1845.610–2, ‘‘Supply

and Equipment Management Office

(Code JLE)’’ is revised to read ‘‘Logistics

Management Office (Code JLG)’’.

1845.7203 [Amended]

36. In section 1845.7203, ‘‘Supply and

Equipment Management Office is

revised to read ‘‘Logistics Management

Office’’ and ‘‘Code JLE’’ is revised to

read ‘‘Code JLG’’ in two occurrences.

1845.7205 [Amended]

37. In section 1845.7205, paragraph

(f)(1), ‘‘Code JLE’’ is revised to read

‘‘Code JLG’’.

38. In section 1845.7205, paragraph

(i), ‘‘Code JLE’’ is revised to read ‘‘Code

JLG’’.

1845.7213 [Amended]

39. In section 1845.7213, paragraph

(c)(1) introductory text, ‘‘Supply and

Equipment Management Office (Code

JLE)’’ is revised to read ‘‘Logistics

Management Office (Code JLG)’’.

PART 1851—USE OF GOVERNMENT

SOURCES BY CONTRACTORS

40. In section 1851.102, the first

sentence of paragraph (b) is revised to

read as follows:

1851.102 Authorization to use Government

supply sources.

(a) * * *

(b) The contracting officer shall

forward letters of authorization to the

installation’s Logistics Management

Officer, Attention: Activity Address

Code Coordinator, who will forward

them to the Logistics Management

Office, NASA Headquarters (Code JLG),

for verification and transmittal to 

GSA. * * *

* * * * *

PART 1852—SOLICITATION

PROVISIONS AND CONTRACT

CLAUSES

1852.208–70, 1852.208–71, 1852.208–72,

1852.208–73, 1852.208–74, 1852.208–76,

1852.208–77, 1852.208–78, 1852.208–79,

1852.208–80, 1852.208–83 [Removed]

41. Sections 1852.208–70, 1852.208–

71, 1852.208–72, 1852.208–73,

1852.208–74, 1852.208–76, 1852.208–

77, 1852.208–78, 1852.208–79,

1852.208–80, and 1852.208–83 are

removed.

1852.208–75 [Redesignated as 1852.241–

70]

42. Section 1852.208–75 is

redesignated as section 1852.241–70

and the introductory text is revised to

read as follow:

1852.241–70 Renewal of Contract.

As prescribed in 48 CFR 1841.501(b),

insert the following clause:

* * * * *

PART 1870—NASA SUPPLEMENTARY

REGULATIONS

1870.103 NASA acquisition of

investigations.

43. In Appendix C to Appendix I of

section 1870.103, Section II, paragraph

A.3.a., ‘‘Office of Policy Coordination

and International Relations, Code IRD’’

is revised to read ‘‘Office of External

Relations, Code IR’’ and in paragraph

A.3.d., ‘‘Code IRD’’ is revised to read

‘‘Code IR’’ and ‘‘Office of Policy

Coordination and International

Relations’’ is revised to read ‘‘Office of

External Relations’’.

[FR Doc. 95–7612 Filed 3–28–95; 8:45 am]

BILLING CODE 7510–01–M

48 CFR Parts 1815, 1837 and 1852

RIN 2700–AB40

Revision to NASA FAR Supplement;

Uncompensated Overtime

AGENCY: Office of Procurement,

Analysis Division, National Aeronautics

and Space Administration (NASA).
16064 Federal Register / Vol. 60, No. 60 / Wednesday, March 29, 1995 / Rules and Regulations

ACTION: Final rule.

SUMMARY: This final rule sets forth the

Agency’s policy regarding the

acceptability of uncompensated

overtime (UCOT) in acquisition

proposals. It establishes that UCOT

provided by employees who are exempt

from the Fair Labor Standards Act is

neither encouraged nor discouraged, but

that labor rates must be adjusted to

account for any UCOT proposed.

Further, any UCOT proposed must be

supported by company policy,

timekeeping and accounting systems,

and the historical basis. The proposal

evaluation will include a technical and

cost risk assessment. A sample list of

criteria to be considered during

evaluation is included.

This final rule includes a solicitation

provision for use in procurements

estimated to exceed $500,000. Its use is

optional in procurements between

$100,000 and $500,000. The solicitation

provision sets forth the agency policy

and specifies the type of information

needed to support any proposed UCOT.

This coverage was generated in

response to industry and internal NASA

requests for a uniform UCOT policy

within the Agency. The coverage will

promote consistent treatment of UCOT

proposals, without constraining

contractors’ prerogatives in deciding

whether to propose UCOT.

EFFECTIVE DATE: April 28, 1995.

FOR FURTHER INFORMATION CONTACT:

Mr. William T. Childs, Telephone: (202)

358–0454.

SUPPLEMENTARY INFORMATION:

Background

NASA published a proposed rule in

59 FR 9951, March 2, 1994, essentially

the same as that being promulgated

here. Based on a review of public

comments on the proposed rule, only

minor changes were made. Fourteen

comments were received from eight

sources:

Two commenters recommended

expansion of the applicability of the

proposed rule, by deletion of the phrase

‘‘in key technical positions’’ in the first

sentence of 48 CFR 1815.608–72.

CONCUR—this change was accepted.

Three commenters recommended that

the clause at 48 CFR 1852.237–72

include the policy statement that UCOT

is neither encouraged nor discouraged.

A fourth commenter expressed a similar

concern. CONCUR—a preamble

paragraph was added to address this in

the clause, based on the policy in 48

CFR 1837.102(b).

Five commenters recommended a

policy reversal, so as to either prohibit

bidding of UCOT or nullify any pricing

advantage. NONCONCUR—it is not our

intention to restrict offerors’ options in

developing their proposals.

The remaining comments addressed

minor clarifications or editorial changes.

Some editorial changes were made to

better organize the coverage and correct

typographical errors.

In addition, a new paragraph (b) is

added in 48 CFR 1815.608–72,

containing a list of sample criteria for

NASA personnel to consider in

evaluating UCOT in proposals.

Availability of NASA FAR Supplement

The NASA FAR Supplement, of

which this will become a part, is

codified in 48 CFR, chapter 18, and is

available in its entirety on a

subscription basis from the

Superintendent of Documents,

Government Printing Office,

Washington, DC 20402. Cite GPO

Subscription Stock Number 933–003–

00000–1. It is not distributed to the

public, whether in whole or in part,

directly by NASA.

Regulatory Flexibility Act

NASA certifies that this Final Rule

will not have a significant economic

impact on a substantial number of small

entities within the meaning of the

Regulatory Flexibility Act (5 U.S.C. 601,

et seq.).

Paperwork Reduction Act

The Office of Management and Budget

(OMB) has approved the information

collection requirements in this rule and

assigned control number 2700–0080.

List of Subjects in 48 CFR Parts 1815,

1837 and 1852

Government procurement.

Thomas S. Luedtke,

Deputy Associate Administrator for

Procurement.

Accordingly, 48 CFR Parts 1815, 1837

and 1852 are amended as follows:

PART 1815—CONTRACTING BY

NEGOTIATION

1. The authority citation for 48 CFR

Parts 1815, 1837 and 1852 continues to

read as follows:

Authority: 42 U.S.C. 2473(c)(1).

2. Section 1815.608–72 is added to

read as follows:

1815.608–72 Uncompensated overtime.

(a) The contracting officer shall

conduct a risk assessment of any

proposal received for technical and

professional services that includes

unrealistically low labor rates, or uses a

high level of uncompensated overtime

(as defined in the provision at 48 CFR

1852.237–72, Identification of

Uncompensated Overtime). Such

practices on the part of the contractor

may jeopardize its ability to successfully

perform contract requirements due, for

example, to its inability to hire or retain

qualified personnel. Such a risk

assessment shall be performed as part of

the technical evaluation and considered

in proposal evaluation (see 48 CFR

(FAR) 22.11 and 48 CFR 1837.102(b)).

(b) The risk assessment should

consider factors such as—

(1) The number of hours that current

employees have been accustomed to

working, and the normal number of

work hours for the local industry;

(2) The turnover rates for the firm and

for the industry in the firm’s

geographical area;

(3) Whether employees involved in

uncompensated overtime share directly

in the firm’s profits; e.g., through

employee-ownership or a profit-sharing

plan;

(4) Whether the contract period of

performance is short, or whether

uncompensated overtime will be used

for only a relatively short period of time;

(5) Whether the firm uses

approximately the same level of

uncompensated overtime in its nongovernment business;

(6) Any potential for decline in

quality or safety both during

performance and in any deliverable

produced; and

(7) The ability of the contractor to

respond to an emergency requiring

additional effort.

PART 1837—SERVICE CONTRACTING

3. Section 1837.102 is added to read

as follows:

1837.102 Policy.

(a) To the maximum extent

practicable, it is the policy of NASA to

acquire services on the basis of the task

to be performed rather than on a laborhour basis.

(b) The use of uncompensated

overtime (as defined in the provision at

48 CFR 1852.237–72, Identification of

Uncompensated Overtime) is neither

encouraged nor discouraged. When the

proposed uncompensated overtime is

consistent with an offeror’s written

policies and practices, NASA will

consider it in proposal evaluation,

including the evaluation of cost and of

professional compensation (see 48 CFR

(FAR) 22.11). The provision at 48 CFR

1852.237–72 requires offerors to identify

uncompensated overtime hours and the

effective hourly rate for all Fair Labor

Standards Act-exempt personnel
Federal Register / Vol. 60, No. 60 / Wednesday, March 29, 1995 / Rules and Regulations 16065

included in their proposals and

subcontractor proposals. This includes

uncompensated overtime hours that are

in indirect cost pools for personnel

whose regular hours are normally

charged direct (see 48 CFR 1815.608–

72).

4. Section 1837.110 is revised to read

as follows:

1837.110 Solicitation provisions and

contract clauses.

(a) The contracting officer shall obtain

the Associate Administrator for

Procurement’s (Code HC) approval

before using in a solicitation, contract,

or negotiated contract modification for

additional work any installationdeveloped clause involving pension

portability.

(b) The following provision applies to

procurements under which professional

and technical services are acquired on

the basis of the number of hours to be

provided, rather than on the task to be

performed.

(1) If the resulting contract is expected

to exceed $500,000, the contracting

officer shall insert in the solicitation the

provision at 48 CFR 1852.237–72,

Identification of Uncompensated

Overtime.

(2) If the resulting contract is expected

to exceed $100,000 but not exceed

$500,000, the contracting officer may

insert in the solicitation the provisions

at 48 CFR 1852.237–72, Identification of

Uncompensated Overtime.

PART 1852—SOLICITATION

PROVISIONS AND CONTRACT

CLAUSES

5. Section 1852.237–72 is added to

read as follows:

1852.237–72 Identification of

Uncompensated Overtime.

As prescribed in 48 CFR 1827.110(b),

insert the following provision:

IDENTIFICATION OF UNCOMPENSATED

OVERTIME

(APRIL 1995)

The use of uncompensated overtime is

neither encouraged nor discouraged. When

the proposed uncompensated overtime is

consistent with an offeror’s written policies

and practices, NASA will consider it in

proposal evaluation, including the evaluation

of cost and of professional compensation (see

48 CFR (FAR) subpart 22.11).

(a) Definitions. As used in this provision:

Uncompensated overtime means the hours

worked in excess of an average of 40 hours

per week, by direct charge employees who

are exempt from the Fair Labor Standards Act

(FLSA) without additional compensation.

Compensated personal absences, such as

holidays, vacations, and sick leave shall be

included in the normal work week for

purposes of computing uncompensated

overtime hours.

Effective hourly rate is the rate that results

from multiplying the hourly rate for a 40-

hour work week by 40, and then dividing by

the proposed hours per week. For example,

45 hours proposed on a 40-hour work week

basis at $20.00 per hour would be converted

to an effective hourly rate of $17.78 per hour

[($20.00×40) divided by 45=$17.78.]

(b) For any hours proposed against which

an effective hourly rate is applied, the Offeror

shall identify in its proposal the hours in

excess of an average of 40 hours per week,

at the same level of detail as compensated

hours, and the effective hourly rate, whether

at the prime or subcontract level. This

includes uncompensated overtime hours that

are in indirect cost pools for personnel whose

regular hours are normally charged direct.

The proposal shall include the rationale and

methodology used to estimate the proposed

amount of uncompensated overtime.

(c) The Offeror’s accounting practices used

to estimate uncompensated overtime must be

consistent with its cost accounting practices

used to accumulate and report

uncompensated overtime hours.

(d) Proposals that include unrealistically

low labor rates, or that do not otherwise

demonstrate cost realism, will be considered

in a technical and cost risk assessment and

evaluated for award in accordance with that

assessment.

(e) The Offeror shall include with its

proposal a copy of its policy addressing

uncompensated overtime, a description of

the timekeeping and accounting systems

used to record all hours worked by FLSAexempt employees, and the historical basis

for the uncompensated overtime hours

proposed.

(End of provision)

[FR Doc. 95–7734 Filed 3–28–95; 8:45 am]

BILLING CODE 7510–01–M

DEPARTMENT OF JUSTICE

48 CFR Part 2801

[Justice Acquisition Circular 95–1]

Amendment to the Justice Acquisition

Regulations (JAR) Regarding Career

Development, Contracting Authority,

and Responsibilities

AGENCY: Office of the Procurement

Executive, Justice Management

Division, Justice.

ACTION: Final rule.

SUMMARY: This final rule amends the

JAR by revising policies and procedures

for redelegation of authority for

contractual actions of goods and

services; revising regulations to set forth

the Department of Justice system for

selection, appointment, and termination

of appointment of contracting officers;

and incorporating the agency’s policies

and procedures regarding the

Procurement Career Management

Program.

EFFECTIVE DATE: March 29, 1995.

FOR FURTHER INFORMATION CONTACT:

Janis Sposato, Procurement Executive,

Justice Management Division (202) 514–

3103.

SUPPLEMENTARY INFORMATION: The

determination is hereby made that this

amendment must be issued as a final

rule. This amendment was not

published for public comment because

it does not have an effect beyond the

internal operating procedures of the

agency. The Director, Office of

Management and Budget, by

memorandum dated December 14, 1984,

exempted agency procurement

regulations from review under

Executive Order 12291, except for

selected areas. The exception applies to

this rule. The Department of Justice

certifies that this rule will not have a

significant economic impact on a

substantial number of small entities

under the Regulatory Flexibility Act (5

U.S.C. 601–612) because the

amendment sets forth, wholly, internal

departmental procedures. No additional

time or cost burden will be placed on

contractors by the promulgation of this

regulation.

List of Subjects in 48 CFR Part 2801

Government procurement.

Dated: March 21, 1995.

Stephen R. Colgate,

Assistant Attorney General for

Administration.

PART 2801—DEPARTMENT OF

JUSTICE ACQUISITION REGULATION

SYSTEM

1. The authority citation for 48 CFR

Part 2801 continues to read as follows:

Authority: 28 U.S.C. 510; 40 U.S.C. 486(c);

28 CFR 0.75(j) and 28 CFR 0.76(j).

2. The heading of subpart 2801.6 is

revised to read as follows:

Subpart 2801.6—Career Development,

Contracting Authority, and

Responsibilities

3. Section 2801.601 is amended by

revising paragraph (d) to read as

follows:

2801.601 General.

* * * * *

(d) The redelegation of contracting

authority directly to specific persons

without regard for intermediate

organizational levels only establishes

authority to represent the Government

in its commercial business dealings. It is

not intended to affect the organizational