Federal Register / Vol. 61, No. 83 / Monday, April 29, 1996 / Rules and Regulations 18921

with the President’s delegation, has

provided guidance for exercise of the

authority delegated by the President to

make determinations of need to make

no-setoff commitments under contracts

containing assignment of claims clauses.

Because this guidance is administrative

in nature and has no significant impact

upon the public, it is being published as

a final rule.

B. Regulatory Flexibility Act

As noted above, this rule implements

a change in authority for existing policy

and procedures in the FAR. This change

in authority to be cited does not change

the usage of the procedure (the no-setoff

commitment) or the impact upon small

entities. Thus, this final rule does not

constitute a significant FAR revision

within the meaning of FAR 1.501 and

Public Law 98–577, and publication for

public comments is not required.

Therefore, the Regulatory Flexibility Act

does not apply. However, comments

from small entities concerning the

affected FAR subpart will be considered

in accordance with Section 610 of the

Act. Such comments must be submitted

separately and cite 5 U.S.C. 601 et seq.,

(FAC 90–38, FAR Case 94–767) in

correspondence.

C. Paperwork Reduction Act

The Paperwork Reduction Act does

not apply because the changes to the

FAR do not impose recordkeeping or

information collection requirements, or

collections of information from offerors,

contractors, or members of the public

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 Part 32

Government procurement.

Dated: April 18, 1996.

Edward C. Loeb,

Deputy Project Manager for the

Implementation of the Federal Acquisition

Streamlining Act of 1994.

Therefore, 48 CFR Part 32 is amended

as set forth below:

PART 32—CONTRACT FINANCING

1. The authority citation for 48 CFR

Part 32 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).

2. Section 32.803 is amended by

revising paragraph (d) to read as

follows:

32.803 Policies.

* * * * *

(d) Any contract of a designated

agency (see FAR 32.801), except a

contract under which full payment has

been made, may include a no-setoff

commitment only when a determination

of need is made by the head of the

agency, in accordance with the

Presidential delegation of authority

dated October 3, 1995, and after such

determination has been published in the

Federal Register. The Presidential

delegation makes such determinations

of need subject to further guidance

issued by the Office of Federal

Procurement Policy. The following

guidance has been provided: Use of the

no-setoff provision may be appropriate

to facilitate the national defense; in the

event of a national emergency or natural

disaster; or when the use of the no-setoff

provision may facilitate private

financing of contract performance.

However, in the event an offeror is

significantly indebted to the United

States, the contracting officer should

consider whether the inclusion of the

no-setoff commitment in a particular

contract is in the best interests of the

United States. In such an event, the

contracting officer should consult with

the Government officer(s) responsible

for collecting the debt(s).

* * * * *

Section 32.806 is amended by revising

paragraph (a)(2) to read as follows:

32.806 Contract clause.

(a) * * *

(2) If a no-setoff commitment has been

authorized (see FAR 32.803(d)), the

contracting officer shall use the clause

with its Alternate I.

* * * * *

[FR Doc. 96–10430 Filed 4–26–96; 8:45 am]

BILLING CODE 6820–EP–P

48 CFR Parts 32 and 52

[FAC 90–38; FAR Case 92–045; Item IV]

RIN 9000–AF44

Federal Acquisition Regulation;

Interest Clause; Revisions

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 on a final rule amending the

Federal Acquisition Regulation (FAR) to

clarify that certain Cost Accounting

Standards (CAS) clauses provide for the

use of differing interest rates under

differing circumstances. This regulatory

action was not subject to Office of

Management and Budget review under

Executive Order 12866, dated

September 30, 1993. It is not a major

rule under 5 U.S.C. 804.

EFFECTIVE DATE: June 28, 1996.

FOR FURTHER INFORMATION CONTACT: Mr.

Jeremy F. Olson at (202) 501–3221 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 90–38, FAR case 92–

045.

SUPPLEMENTARY INFORMATION:

A. Background

Under the CAS clauses at 52.230–2,

Cost Accounting Standards, 52.230–3,

Disclosure and Consistency of Cost

Accounting Practices, and 52.230–4,

Consistency in Cost Accounting

Practices, interest charges associated

with contract price adjustments

resulting from CAS noncompliance are

computed at the annual interest rate

established under section 6621 of the

Internal Revenue Code of 1986 (26

U.S.C. 6621), as required by subsection

5(h)(4) of the Office of Federal

Procurement Policy Act Amendments of

1988 (Public Law 100–679). The clauses

at 52.230–2 and 52.230–3 also specify

that disputes are subject to the Contract

Disputes Act which, in contrast, uses

the semiannual interest rate established

by the Secretary of the Treasury for the

Renegotiation Board pursuant to Public

Law 92–41. This rule revises FAR

32.610(b)(2), 32.613(h)(3), 32.614–1(c),

and the clause at 52.232–17 to clarify

that the CAS clauses at 52.230–2 and

52.230–3 provide for the use of differing

interest rates under differing

circumstances.

B. Regulatory Flexibility Act

The final rule does not constitute a

significant FAR revision within the

meaning of FAR 1.501 and Public Law

98–577, and publication for public

comments is not required. Therefore,

the Regulatory Flexibility Act does not

apply. However, comments from small

entities concerning the affected FAR

subparts will be considered in

accordance with 5 U.S.C. 610. Such

comments must be submitted separately

and cite 5 U.S.C. 601 et seq. (FAC 90–

38, FAR case 92–045), in

correspondence.
18922 Federal Register / Vol. 61, No. 83 / Monday, April 29, 1996 / Rules and Regulations

C. Paperwork Reduction Act

The Paperwork Reduction Act does

not apply because the changes to the

FAR do not impose recordkeeping or

information collection requirements, or

collections of information from offerors,

contractors, or members of the public

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 32 and

52

Government procurement.

Dated: April 19, 1996.

Edward C. Loeb,

Director, Federal Acquisition Policy Division.

Therefore, 48 CFR Parts 32 and 52 are

amended as set forth below:

PART 32—CONTRACT FINANCING

1. The authority citation for 48 CFR

Parts 32 and 52 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).

2. Section 32.610 is amended by

revising paragraph (b)(2) to read as

follows:

32.610 Demand for payment of contract

debt.

* * * * *

(b) * * *

(2) Notification that any amounts not

paid within 30 days from the date of the

demand will bear interest from the date

of the demand, or from any earlier date

specified in the contract, and that the

interest rate shall be the rate established

by the Secretary of the Treasury, for the

period affected, under Public Law 92–

41. In the case of a debt arising from a

price reduction for defective pricing, or

as specifically set forth in a Cost

Accounting Standards (CAS) clause in

the contract, that interest will run from

the date of overpayment by the

Government until repayment by the

contractor at the underpayment rate

established by the Secretary of the

Treasury, for the periods affected, under

26 U.S.C. 6621(a)(2).

* * * * *

3. Section 32.613 is amended by

revising paragraph (h)(3) to read as

follows:

32.613 Deferment of collection.

* * * * *

(h) * * *

(3) Notice of an interest charge, in

conformity with FAR 32.614 and the

clause at FAR 52.232–17, Interest; or, in

the case of a debt arising from a

defective pricing or a CAS

noncompliance overpayment, interest,

as prescribed by the applicable Price

Reduction for Defective Cost or Pricing

Data or CAS clause.

* * * * *

4. Section 32.614–1 is amended by

revising the first sentence of paragraph

(c) introductory text to read as follows:

32.614–1 Interest charges.

* * * * *

(c) Unless specified otherwise in the

clause at FAR 52.232–17, the interest

charge shall be at the rate established by

the Secretary of the Treasury under

Public Law 92–41 for the period in

which the amount becomes due. * * *

* * * * *

PART 52—SOLICITATION PROVISIONS

AND CONTRACT CLAUSES

5. Section 52.232–17 is amended by

revising the date of the clause and the

first sentence of paragraph (a) to read as

follows:

52.232–17 Interest.

* * * * *

INTEREST (JUNE 1996)

(a) Except as otherwise provided in this

contract under a Price Reduction for

Defective Cost or Pricing Data clause or a

Cost Accounting Standards clause, all

amounts that become payable by the

Contractor to the Government under this

contract (net of any applicable tax credit

under the Internal Revenue Code (26 U.S.C.

1481)) shall bear simple interest from the

date due until paid unless paid within 30

days of becoming due. * * *

* * * * *

[FR Doc. 96–10431 Filed 4–26–96; 8:45 am]

BILLING CODE 6820–EP–P