Army Contracting Command Guilty of Noncompliance with a Nonexistent Rule
In a recent DoD IG report, the Army Contracting Command was cited for its failure to perform "component assessments" on 23 contracts subject to the Buy American Act (see DoD IG Report No. 2015-026). The report states as follows:
ACC contracting personnel did not complete component assessments for 23 contracts. DFARS 252.225-7001(a) (3) (ii) (A) requires contracting officers to determine whether the cost of the end product and its components that are mined, produced, or manufactured in the United States or qualifying country exceed 50 percent of the cost of all components. However, for 16 of the 36 contracts for commercial items reviewed, ACC contracting personnel did not distinguish between commercial items that require an assessment and commercial off-the-shelf items that do not require an assessment. In addition, for 7 of the 14 contracts for non-commercial items reviewed, ACC contracting personnel did not complete component assessments to determine compliance with the Buy American Act.
Not having ever heard of such a requirement, I checked the reference to this requirement, which was allegedly located in DFARS 252.225-7001( a )(3)(ii)(A). DFARS 252.225-7001 is a contract clause entitled "Buy American Act and Balance of Payments Program". The clause does not contain "( a )(3)(ii)(A)", but it does contain a paragraph "( a )". Paragraph ( a ) defines, for purposes of their use in the clause, the terms "Commercially available off-the-shelf (COTS) item", "component", "domestic end product", "end product", "foreign end product", "qualifying country", "qualifying country component", "qualifying country end product", and "United States". The paragraph does not require the contracting officer to do anything. In fact, it doesn't require that anybody do anything--it merely defines words and terms. The balance of the clause imposes an explicit requirement on the contractor in paragraph ( c ) and an implied requirement on the contractor in paragraph ( d ):
(b ) This clause implements 41 U.S.C chapter 83, Buy American. In accordance with 41 U.S.C. 1907, the component test of the Buy American statute is waived for an end product that is a COTS item (see section 12.505(a)(1) of the Federal Acquisition Regulation). Unless otherwise specified, this clause applies to all line items in the contract.
(c ) The Contractor shall deliver only domestic end products unless, in its offer, it specified delivery of other end products in the Buy American--Balance of Payments Program Certificate provision of the solicitation. If the Contractor certified in its offer that it will deliver a qualifying country end product, the Contractor shall deliver a qualifying country end product or, at the Contractors option, a domestic end product.
(d) The contract price does not include duty for end products or components for which the Contractor will claim duty-free entry.
Nothing in the entire clause requires the contracting officer to do anything. The terms "contracting officer" and "component assessment" do not appear in the clause. The term "component test" appears once--in paragraph ( b ) (see above). No duty of the contracting officer can reasonably be inferred.
When read together with the provision at DFARS 252.225-7000, it is clear that any assessment of end item components should be done by an offeror when determining how to complete the certification in DFARS 252.225-7000( c ):
- Certifications and identification of country of origin.
- (1) For all line items subject to the Buy American and Balance of Payments ProgramBasic clause of this solicitation, the offeror certifies that
(2) The offeror certifies that the following end products are qualifying country end products:
- (i) Each end product, except those listed in paragraphs ©(2) or (3) of this provision, is a domestic end product; and
(ii) For end products other than COTS items, components of unknown origin are considered to have been mined, produced, or manufactured outside the United States or a qualifying country.
Line Item Number
Country of Origin
- (3) The following end products are other foreign end products, including end products manufactured in the United States that do not qualify as domestic end products, i.e., an end product that is not a COTS item and does not meet the component test in paragraph (ii) of the definition of domestic end product:
Line Item Number
Country of Origin (If known)
(End of provision)
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I assume that the Army Contracting Command pointed out the flawed assumption that the IG had made when responding to the audit. Let me just check their response to this finding to be sure:
The Deputy to the Commanding General, U.S. Army Contracting Command, responding for the Commanding General, Army Contracting Command, agreed with the findings and the recommendations, stating Army Contracting Command personnel would receive training on the distinction between commercial and commercial off-the-shelf items, as well as how to perform component assessments and the requirements to include the Buy American Act implementing clauses. In addition, Army Contracting Command will require contracting personnel to take Buy American Act training offered by the Defense Acquisition University. The training will be mandatory for all contracting personnel in FY 2015.
Oh, well. Get ready ACC contracting personnel--you will soon be receiving a policy memo requiring you to take CLC 027 Buy American Act. And no, it does not contain guidance on how contracting officers are to perform "component assessments".
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