[Federal Register: August 4, 2006 (Volume 71, Number 150)]
[Rules and Regulations]
[Page 44546-44549]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr04au06-21]
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DEPARTMENT OF DEFENSE
GENERAL SERVICES ADMINISTRATION
NATIONAL AERONAUTICS AND SPACE ADMINISTRATION
48 CFR Parts 6, 12, 26, and 52
[FAC 2005-12; FAR Case 2006-014; Docket 2006-0020, Sequence 8]
RIN 9000-AK54
Federal Acquisition Regulation; FAR Case 2006-014, Local
Community Recovery Act of 2006
AGENCIES: Department of Defense (DoD), General Services Administration
(GSA), and National Aeronautics and Space Administration (NASA).
ACTION: Interim rule with request for comments.
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SUMMARY: The Civilian Agency Acquisition Council and the Defense
Acquisition Regulations Council (Councils) have agreed on an interim
rule amending the Federal Acquisition Regulation (FAR) to implement the
Local Community Recovery Act of 2006. The Local Community Recovery Act
of 2006 amended the Robert T. Stafford Disaster Relief and Emergency
Assistance Act to authorize set-asides for major disaster or emergency
assistance acquisitions to businesses that reside or primarily do
business in the geographic area affected by the disaster or emergency.
DATES: Effective Date: August 4, 2006.
Comment Date: Interested parties should submit written comments to
the FAR Secretariat on or before October 3, 2006 to be considered in
the formulation of a final rule.
ADDRESSES: Submit comments identified by FAC 2005-12, FAR case 2006-
014, by any of the following methods:
Federal eRulemaking Portal: http://frwebgate.access.gpo.gov/cgi-bin/leaving.cgi?from=leavingFR.html&log=linklog&to=http://www.regulations.gov/far.
Follow the instructions for submitting comments.
Agency Web Site: http://frwebgate.access.gpo.gov/cgi-bin/leaving.cgi?from=leavingFR.html&log=linklog&to=http://www.acquisition.gov/comp/far/ProposedRules/comments.htm.
Click on the FAR case number to submit
comments.
E-mail: farcase.2006-014@gsa.gov. Include FAC 2005-12, FAR
case 2006-014 in the subject line of the message.
Fax: 202-501-4067.
Mail: General Services Administration, Regulatory
Secretariat (VIR), 1800 F Street, NW, Room 4035, ATTN: Laurieann
Duarte, Washington, DC 20405.
Instructions: Please submit comments only and cite FAC 2005-12, FAR
case 2006-014, in all correspondence related to this case. All comments
received will be posted without change to http://frwebgate.access.gpo.gov/cgi-bin/leaving.cgi?from=leavingFR.html&log=linklog&to=http://www.acquisition.gov/comp/far/
[[Page 44547]]
ProposedRules/comments.htm, including any personal and/or business
confidential information provided.
FOR FURTHER INFORMATION CONTACT: For clarification of content, contact
Ms. Rhonda Cundiff, Procurement Analyst, at (202) 501-0044. Please cite
FAC 2005-12, FAR case 2006-014. For information pertaining to status or
publication schedules, contact the FAR Secretariat at (202) 501-4755.
SUPPLEMENTARY INFORMATION:
A. Background
This interim rule implements the Local Community Recovery Act of
2006 (Pub. L. 109-218). The Local Community Recovery Act of 2006
amended the Robert T. Stafford Disaster Relief and Emergency Assistance
Act (42 U.S.C. 5150) to authorize set-asides for debris clearance,
distribution of supplies, reconstruction, and other major disaster or
emergency assistance acquisitions to businesses that reside or
primarily do business in the geographic area affected by the disaster
or emergency. The set-aside may be used together with other authorized
set-asides, for example, those in FAR Part 19 for small businesses.
The contracting officer determines the geographic area for a
specific local area set-aside. The local area set-aside may be the
whole of, or some subpart of, the affected area (e.g., one or more
counties, including across state lines). However, it may not be outside
of the declared disaster/emergency area.
This rule also imposes subcontracting restrictions when a local
area set-aside is used. To promote local recovery efforts, the rule
requires certain percentages of the contract to be expended for
employees of the contractor or employees of other local area
businesses. If the contract includes other subcontracting restrictions
(e.g., FAR 52.219-3, 52.219-14, 52.219-27, 52.226-5, or 52.236-1), the
contractor must meet all the subcontracting restrictions in the
contract.
In addition, the rule establishes a new FAR Subpart 6.6 to clarify
the competition justification requirements for Stafford Act
acquisitions. The coverage on the Stafford Act previously located at
FAR 6.302-5 has been moved to the new subpart.
The Councils would like to hear the views of interested parties on
the sufficiency of these provisions. In particular, the Councils are
interested in input on whether the ``Restrictions on Subcontracting
Outside Disaster or Emergency Area'' and the ``Disaster or Emergency
Area Representation'' should apply to preferences other than local area
set-asides; and whether the percentages for general or specialty
construction should be raised. The Councils are also interested in
input regarding the placement of various Stafford-Act-related coverage
in the FAR: that is, comments addressing the optimal combination of
regulatory treatment in FAR Subparts such as 6.2, 6.3, 6.6, and 26.2.
This is not a significant regulatory action and, therefore, was not
subject to review under Section 6(b) of Executive Order 12866,
Regulatory Planning and Review, dated September 30, 1993. This rule is
not a major rule under 5 U.S.C. 804.
B. Regulatory Flexibility Act
The interim rule is not expected to 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., because it
authorizes a set-aside for local businesses in an area affected by a
major disaster or emergency to promote economic recovery. The set-aside
does not replace the small business set-aside. Both set-asides can
apply to the acquisition. The local set-aside will encourage use of
local small businesses. Therefore, an Initial Regulatory Flexibility
Analysis has not been performed. The Councils will consider comments
from small entities concerning the affected FAR Parts 6, 12, 26, and 52
in accordance with 5 U.S.C. 610. Interested parties must submit such
comments separately and should cite 5 U.S.C 601, et seq. (FAC 2005-12,
FAR case 2006-014), in correspondence.
C. Paperwork Reduction Act
The Paperwork Reduction Act does not apply because the changes to
the FAR do not impose information collection requirements that require
the approval of the Office of Management and Budget under 44 U.S.C.
3501, et seq.
D. Determination to Issue an Interim Rule
A determination has been made under the authority of the Secretary
of Defense (DoD), the Administrator of General Services (GSA), and the
Administrator of the National Aeronautics and Space Administration
(NASA) that urgent and compelling reasons exist to promulgate this
interim rule without prior opportunity for public comment. This action
is necessary because this interim rule implements the Local Community
Recovery Act of 2006 (Pub. L. 109-218). The Local Community Recovery
Act of 2006 amended the Robert T. Stafford Disaster Relief and
Emergency Assistance Act (42 U.S.C. 5150) to authorize set-asides for
major disaster or emergency assistance acquisitions to businesses that
reside or primarily do business in the geographic area affected by the
disaster or emergency. This action is necessary to improve the
Government's ability to target local businesses and promote local
economic recovery in an affected area. The statute went into effect
April 20, 2006. However, pursuant to Public Law 98-577 and FAR 1.501,
the Councils will consider public comments received in response to this
interim rule in the formation of the final rule.
List of Subjects in 48 CFR Parts 6, 12, 26, and 52
Government procurement.
Dated: July 28, 2006.
Ralph De Stefano,
Director, Contract Policy Division.
0
Therefore, DoD, GSA, and NASA amend 48 CFR parts 6, 12, 26, and 52 as
set forth below:
0
1. The authority citation for 48 CFR parts 6, 12, 26, and 52 continues
to read as follows:
Authority: 40 U.S.C. 121(c); 10 U.S.C. chapter 137; and 42
U.S.C. 2473(c).
PART 6--COMPETITION REQUIREMENTS
6.302-5 [Amended]
0
2. Amend Sec. 6.302-5 by removing paragraph (b)(5) and redesignating
paragraphs (b)(6) and (b)(7) as (b)(5) and (b)(6), respectively.
0
3. Add Subpart 6.6 to read as follows:
Subpart 6.6--Stafford Act Preference for Local Area Contractor
Sec.
6.601 Scope of subpart.
6.602 Set-asides for local firms during a major disaster or
emergency.
6.603 Use of procedures other than set-aside.
6.601 Scope of subpart.
This subpart prescribes competition policies and procedures for
procurements under the Robert T. Stafford Disaster Relief and Emergency
Assistance Act (42 U.S.C. 5150).
6.602 Set-asides for local firms during a major disaster or
emergency.
(a) To fulfill the statutory requirements relating to Pub. L. 109-
218, part of the Stafford Act, contracting officers may set-aside
solicitations to allow only offerors residing or doing business
primarily in the area affected by such major disaster or emergency to
compete (see Subpart 26.2).
[[Page 44548]]
(b) No separate justification or determination and findings are
required under this part to set-aside a contract action. The set-aside
shall be based on a specific geographic area, within a Presidential
declaration(s) of disaster or emergency.
6.603 Use of procedures other than set-aside.
When implementing the Stafford Act preference by using procedures
other than a set-aside under section 6.602, the requirements for a
justification to support the use of this authority are in 6.303. These
procurements qualify as other than full and open competition.
PART 12--ACQUISITION OF COMMERCIAL ITEMS
0
4. Amend Sec. 12.301 by adding paragraph (e)(4) to read as follows:
12.301 Solicitation provisions and contract clauses for the
acquisition of commercial items.
* * * * *
(e) * * *
(4) When setting aside under the Stafford Act (Subpart 26.2),
include the representation at 52.226-3, the notice at 52.226-4, and the
clause at 52.226-5 in the solicitation. This representation is not in
the Online Representations and Certifications Application (ORCA)
Database.
* * * * *
PART 26--OTHER SOCIOECONOMIC PROGRAMS
0
5. Amend Sec. 26.200 by removing ``6.302-5'' and adding ``Subpart
6.6'' in its place.
0
6. Add Sec. Sec. 26.202 and 26.203 to read as follows:
26.202 Procedures to accomplish the local area preference.
(a) Local area set-aside. The contracting officer may set-aside
solicitations to allow only offerors residing or doing business
primarily in the area affected by such major disaster or emergency to
compete (see 6.602).
(1) The contracting officer, in consultation with the requirements
office, shall define the specific geographic area for the local set-
aside.
(2) A major disaster may result in numerous Presidential
declarations spanning counties in several contiguous States. The
designated area need not include all the counties in the declared
disaster/emergency area(s), but cannot go outside it.
(3) The contracting officer shall also consider whether a local
area set-aside should be further restricted to small business concerns
in the designated area (see Part 19).
(b) Other appropriate procedures. The contracting officer may use
other appropriate procedures to give preference to those organizations,
firms, or individuals residing or doing business primarily in the area
affected by the major disaster or emergency to the extent feasible and
practicable. For example, the contracting officer may implement the
preference by using an evaluation factor. (See 6.603).
26.203 Solicitation provisions and contract clause.
(a) The contracting officer shall insert the provision at 52.226-3,
Disaster or Emergency Area Representation, for acquisitions using the
local area set-aside. For commercial items see 12.301(e)(4).
(b) The contracting officer shall insert the provision 52.226-4,
Notice of Disaster or Emergency Area Set-aside in solicitations and
contracts for acquisitions that are set-aside for a Disaster or
Emergency Area under 26.203(a).
(c) The contracting officer shall insert clause 52.226-5,
Restrictions on Subcontracting Outside Disaster or Emergency Area, in
all solicitations and contracts that contain the provision at 52.226-3.
PART 52--SOLICITATION PROVISIONS AND CONTRACT CLAUSES
0
7. Amend Sec. 52.212-5 by revising the date of the clause and
paragraphs (b)(27) and (b)(28) to read as follows:
52.212-5 Contract Terms and Conditions Required to Implement Statutes
or Executive Orders--Commercial Items.
* * * * *
CONTRACT TERMS AND CONDITIONS REQUIRED TO IMPLEMENT STATUTES OR
EXECUTIVE ORDERS--COMMERCIAL ITEMS (AUG 2006)
* * * * *
(b) * * *
---- (27) 52.226-4, Notice of Disaster or Emergency Area Set-Aside
(42 U.S.C. 5150).
---- (28) 52.226-5, Restrictions on Subcontracting Outside Disaster
or Emergency Area (42 U.S.C. 5150).
* * * * *
0
8. Add Sec. Sec. 52.226-3, 52.226-4, and 52.226-5 to read as follows:
52.226-3 Disaster or Emergency Area Representation.
As prescribed in 26.203(a), insert the following provision:
DISASTER OR EMERGENCY AREA REPRESENTATION (AUG 2006)
(a) Set-aside area. The area covered in this contract is: --------
------------ [Contracting Officer to fill in with definite geographic
boundaries.]
(b) Representations. The offeror represents as part of its offer
that it [square] is, [square] is not a firm residing or primarily doing
business in the designated area.
(c) Factors to be considered in determining whether a firm resides
or primarily does business in the designated area include--
(1) Location(s) of the firm's permanent office(s) and date any
office in the designated area(s) was established;
(2) Existing state licenses;
(3) Record of past work in the designated area(s) (e.g., how much
and for how long);
(4) Contractual history the firm has had with subcontractors and/or
suppliers in the designated area;
(5) Percentage of the firm's gross revenues attributable to work
performed in the designated area;
(6) Number of permanent employees the firm employs in the
designated area;
(7) Membership in local and state organizations in the designated
area; and
(8) Other evidence that establishes the firm resides or primarily
does business in the designated area.
(d) If the offeror represents it is a firm residing or primarily
doing business in the designated area, the offeror shall furnish
documentation to support its representation if requested by the
Contracting Officer. The solicitation may require the offeror to submit
with its offer documentation to support the representation.
(End of provision)
52.226-4 Notice of Disaster or Emergency Area Set-Aside.
As prescribed in 26.203(b), insert the following provision:
NOTICE OF DISASTER OR EMERGENCY AREA SET-ASIDE (AUG 2006)
(a) Set-aside area. Offers are solicited only from businesses
residing or primarily doing business in --------------------
[Contracting Officer to fill in with definite geographic boundaries.]
Offers received from other businesses shall not be considered.
(b) This set-aside is in addition to any small business set-aside
contained in this contract.
(End of provision)
52.226-5 Restrictions on Subcontracting Outside Disaster or Emergency
Area.
As prescribed in 26.203(c), insert the following clause:
RESTRICTIONS ON SUBCONTRACTING OUTSIDE DISASTER OR EMERGENCY
AREA (AUG 2006)
The Contractor agrees that in performance of the contract in the
case of a contract for--
[[Page 44549]]
(a) Services (except construction). At least 50 percent of the cost
of contract performance incurred for personnel shall be expended for
employees of the Contractor or employees of other businesses residing
or primarily doing business in the area designated in FAR 52.226-4;
(b) Supplies (other than procurement from a nonmanufacturer of such
supplies). The Contractor or employees of other businesses residing or
primarily doing business in the designated area shall perform work for
at least 50 percent of the cost of manufacturing the supplies, not
including the cost of materials;
(c) General construction. The Contractor will perform at least 15
percent of the cost of the contract, not including the cost of
materials, with its own employees or employees of other businesses
residing or primarily doing business in the designated area; or
(d) Construction by special trade Contractors. The Contractor will
perform at least 25 percent of the cost of the contract, not including
the cost of materials, with its own employees or employees of other
businesses residing or primarily doing business in the designated area.
(End of clause)
[FR Doc. 06-6672 Filed 8-3-06; 8:45 am]
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