Source: https://www.federalregister.gov/documents/2013/12/31/2013-31149/federal-acquisition-regulation-prioritizing-sources-of-supplies-and-services-for-use-by-the
Timestamp: 2017-08-22 14:09:28
Document Index: 203856912

Matched Legal Cases: ['art 8', 'arts 7', 'art 19', 'art 8', 'art 8', 'art 8', 'art 10', 'art 10', 'arts 7', 'art 6', 'art 6']

78 FR 80376
80376-80379 (4 pages)
1. Federal Strategic Sourcing Initiative (FSSI) Blanket Purchase Agreement (BPA) for Office Supplies
3. Federal Supply Schedule (FSS) Contracts
4. The Murray Benjamin Electric Company Protest
5. FAR Case 2008-003
6. Other Requested Changes to FAR Part 8
7. Comments Submitted on the IRFA
List of Subjects in 48 CFR Parts 7, 8, 9, and 52
https://www.federalregister.gov/d/2013-31149 https://www.federalregister.gov/d/2013-31149
Mr. Karlos Morgan, Procurement Analyst, at 202-501-2364, for clarification of content. For information pertaining to status or publication schedules, contact the Regulatory Secretariat at 202-501-4755. Please cite FAC 2005-72, FAR Case 2009-024.
DoD, GSA, and NASA published a proposed rule in the Federal Register at 76 FR 34634 on June 14, 2011, to amend the Federal Acquisition Regulation (FAR) to limit the section of the FAR addressing the priorities for use of Government supply sources to a discussion of the mandatory Government sources of supplies and services. Seventy-nine respondents submitted comments. Most respondents requested that an Initial Regulatory Flexibility Analysis (IRFA) be performed. Based on the comments, the Civilian Agency Acquisition Council and the Defense Acquisition Regulations Council (the Councils) performed an IRFA after the initial publication of the proposed rule. The IRFA was published in the Federal Register at 77 FR 54872 on September 6, 2012. Six respondents submitted comments in response to the Notice of Correction.
Language was added at FAR 7.102(a) to require consideration of existing contracts before creating new contracts.
FAR 8.002(a)(1)(i) was revised to read “Inventories of the requiring agency” for clarification.
FAR 8.003(d) has been revised to note that the Defense National Stockpile Center has been renamed “DLA Strategic Materials”.
FAR 8.004 was revised to note that the sources listed in 8.004(a) are not listed in any order of priority.
A sentence was added to FAR 8.004 reminding users that when satisfying requirements from non-mandatory sources, they should refer to FAR 7.105(b) and part 19 regarding consideration of small business, veteran-owned small business, service-disabled veteran-owned small business, HUBZone small business, small disadvantaged business (including 8(a) participants), and women-owned small business concerns. Use of these sources can be counted towards an agency's small business contracting goals.
Comment: Most respondents believe the rule is both unnecessary and damaging to competition from small businesses throughout their industry. The FSSI program has curtailed their Federal market business which led to reduction in employees' hours.
Response: The purpose of the rule is to update and clarify the order of priority at FAR 8.002, and add a new section to encourage agencies to give consideration to using certain existing non-mandatory sources to leverage agency buying power and achieve administrative efficiencies that reduce costs and produce savings for our taxpayers. The rule does not change how agencies are purchasing supplies and/or services under Federal Supply Schedules.
No new mandatory sources are proposed for consideration, only existing sources were included for informational purposes. The existing non-mandatory sources are being listed prior to commercial sources, but agencies remain free to compete their requirements among commercial sources of supply, where it is in their best interest to meet their needs through open-market procurement.
Comment: Respondents indicated that the proposed rule would severely hamper competition in the Federal market place.
Response: This rule does not impede competition. No new mandatory sources are proposed for consideration under this rule. Existing sources were included for informational purposes, as a means of supporting market research, which is required by law (41 U.S.C. 3301(a)(2)) for the procurement of supplies and services. Competition in the open market will continue if it is in an agency's best interests to meet its needs through open-market procurement.
Comment: A respondent stated that the proposed rule is not clear about whether the contracting officer must check and use contracts under FSS if there is an FSS holder that can meet the agency's needs.
Response: The use of FSS is not required. However, under FAR 7.102(a)(4) of the final rule, agencies are encouraged to consider using FSS and other existing vehicles before considering sources in the open market.
Comment: One respondent indicated that use of FSS is mandatory if the schedule holder is able to meet the agency's needs. The respondent stated that the Murray Benjamin case is ambiguous and the Government interpretation is faulty.
Response: The final rule amends FAR part 8 to clarify that use of FSS is not mandatory. Rather, as part of good market research, agencies are encouraged to consider using FSS and other existing vehicles before considering sources in the open market.
Comment: One respondent indicated that the proposed rule undermines the intent behind the rule change from FAR Case 2008-003. According to the respondent, 2008-003 final rule requires competition within the FSS for contracts over the simplified acquisition threshold. The respondent believed that the proposed rule requires competition to the open market, not just within FSS.
Response: Final rule 2008-003, “Public Disclosure of Justification and Approval Documents for Noncompetitive Contracts,” which required posting justification and approval documents for noncompetitive contracts, did not apply to placement of orders under the FSS. FAR Case 2007-012, “Requirements for Acquisitions Pursuant to Multiple-Award Contracts,” which implemented section 863 of the Duncan Hunter National Defense Act for Fiscal Year 2009, required posting of sole source task or delivery orders in excess of the simplified acquisition threshold that are placed against multiple award contracts. This rule is consistent with the intent of FAR Case 2007-012 to provide enhanced competition.
Comment: A respondent indicated that the rule should not include Governmentwide Acquisition Contracts (GWACs) in FAR part 8 and give them the same level of priority as FSS contracts.
Response: The inclusion of GWACs in FAR part 8 is appropriate as they are existing contract vehicles available for use by multiple agencies. Agencies are encouraged to consider existing vehicles prior to awarding new contracts.
Comment: A respondent recommended that FAR 8.004 be revised to include text that explains that the enumerated contracts are not, as the preamble to the proposed rule notes, listed in any order of priority.
Response: The language of the final rule was revised to include this clarification.
Comment: Several respondents expressed their disappointment with the rule and suggested further study of the negative impacts of the rule.
Response: Because the rule reflects existing policy and practices, there is no need to conduct additional economic impact analysis and other research called for by the respondents.
Comment: Various respondents expressed dissatisfaction with FSSI, due to a perceived impediment to competition.
Response: The reference to FSSI agreements in FAR 8.004(a)(1) of the final rule is provided as an example of existing non-mandatory sources that agencies are encouraged to consider as part of their market research before considering open market sources.
Comment: One respondent recommended requiring documentation in the contract file to reflect why an existing source does not meet the Government's needs.
Response: This type of documentation may be appropriate as part of the market research process detailed in FAR part 10, Market Research, and, in many cases, is already required by agency supplements to FAR part 10.
Comment: One respondent recommended that the Government require agencies to consider the use of existing sources rather than merely encouraging them to do so.
Response: The final rule amends FAR 7.102(a) to require, as part of acquisition planning, appropriate consideration of the use of pre-existing contracting (including interagency and intra-agency contracts) to fulfill requirements before awarding new contracts.
Considerable concern was expressed by small business entities with the concept and practice of strategic sourcing as evidenced through FSSI agreements. However, the rule itself only references FSSI agreements as an example of existing contract sources that agencies, as part of good market research, are encouraged to consider using before considering sources in the open market. After due consideration of pre-existing contracts, agencies remain free to compete their requirements among commercial sources of supply.
No significant changes were made from the proposed rule in response to comments on the IRFA.
This rule deals with the order of preference for sources that must be considered, and to distinguish them from sources that should be considered where an agency is unable to satisfy requirements for supplies and services from mandatory sources. This rule will not affect how many small businesses are awarded this type of contract.
Therefore, DoD, GSA, and NASA amend 48 CFR parts 7, 8, 9, and 52 as set forth below:
2. Amend section 7.102 by revising paragraph (a) to read as follows:
(1) Acquisition of commercial items or, to the extent that commercial items suitable to meet the agency's needs are not available, nondevelopmental items, to the maximum extent practicable (10 U.S.C. 2377 and 41 U.S.C. 251, et seq.);
(2) Full and open competition (see part 6) or, when full and open competition is not required in accordance with Part 6, to obtain competition to the maximum extent practicable, with due regard to the nature of the supplies or services to be acquired (10 U.S.C. 2301(a)(5) and 41 U.S.C. 253a(a)(1));
3. Revise section 8.000 to read as follows:
4. Revise section 8.002 to read as follows:
Priorities for use of mandatory Government sources.
5. Revise section 8.003 to read as follows:
Use of other mandatory sources.
6. Redesignate section 8.004 as section 8.005; and add a new section 8.004 to read as follows:
7. Amend section 8.402 by removing from paragraph (a) “(see 8.002)” and adding “(see 8.004)” in its place.
8. Amend section 9.405-1 by removing from paragraph (b)(2) “optional use”.
9. Amend section 52.208-9 by removing from the introductory paragraph “8.004” and adding “8.005” in its place.
[FR Doc. 2013-31149 Filed 12-30-13; 8:45 am]