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FAC 2005-43 Contains Five Rules

The Civilian Agency Acquisition and Defense Acquisition Regulations Councils have published Federal Acquisition Circular 2005-43, which contains three final and two interim rules amending the Federal Acquisition Regulation. In order of appearance, the rules address the following subjects: Item I, Government Property (FAR Case 2008-011); Item II, Registry of Disaster Response Contractors (FAR Case 2008-035); Item III, Recovery Act Subcontract Reporting Procedures (FAR Case 2010-008; Interim); Item IV, Clarification of Criteria for Sole Source Awards to Service-disabled Veteran-owned Small Business Concerns (FAR Case 2008-023); and Item V, Trade Agreements Thresholds (FAR Case 2009-040; Interim). This FAC also contains a Small Entity Compliance Guide. The final rules go into effect on August 2, 2010, while the interim rules carry a July 2, 2010, effective date. Comments on the interim rules, identified by their respective FAR case number, are due by August 16, 2010. A full listing of the FAR sections impacted by these rules appears in the table below. For the text of FAC 2005-43, see 70,002.122 .


The final rule associated with FAR Case 2008-011 amends FAR Part 45, Government Property, and its associated clauses and provisions. This rule clarifies and corrects the previous FAR rule for Part 45 (FAR Case 2004-025), published in FAC 2005-17. In response to comments, this final rule makes minor changes to the proposed rule (70,006.230). The amendments impact the following regulations: FAR 2.101, "Definitions"; FAR 4.705-3, "Acquisition and supply records "; FAR 15.404-4, "Profit"; FAR 42.302, "Contract administration functions "; FAR 45.101, "Definitions"; FAR 45.102, "Policy"; FAR 45.104, "Responsibility and liability for Government property"; FAR 45.105, "Contractors' property management system compliance"; FAR 45.201, "Solicitation"; FAR 45.402, "Title to contractor-acquired property "; FAR 45.502, "Subcontractor and alternate prime contractor locations"; FAR 45.602-3, "Screening"; FAR 45.604-3, "Sale of surplus personal property"; and FAR 45.606-1, "Contractor with an approved scrap procedure." The rule also revises the clauses at FAR 52.232-16, "Progress Payments"; FAR 52.232-32, "Performance Based Payments"; FAR 52.245-1, "Government Property"; FAR 52.245-2, "Government Property Installation Operation Services"; FAR 52.245-9, "Use and Charges"; and FAR 52.251-1, "Government Supply Sources." Corresponding technical amendments are made to FAR 31.205-19, FAR 32.503-16, and FAR 32.1010.

Disaster Response

A final rule, FAR Case 2008-035, finalizes without change an interim rule issued with FAC 2005-37 that amended the FAR to implement the Department of Homeland Security Appropriations Act, 2007, Section 697 (PL 109-295). The Act requires the Administrator of the Federal Emergency Management Agency to establish and maintain a registry of contractors willing to perform debris removal, distribution of supplies, reconstruction, and other disaster or emergency relief activities. The registry includes business information consistent with the data that is currently required in the Central Contractor Registration with two additional categories added to reflect the area served by the business, and the bonding level of the business concern. This interim rule added a definition for the "Disaster Response Registry" at FAR 2.101; redesignated FAR 4.1104 as FAR 4.1105; and added a new FAR 4.1104, requiring contracting officers to consult the registry at www.ccr.gov. The rule also added a paragraph (v) to FAR 7.103 that requires agency heads to prescribe procedures to ensure COs consult the registry; included a reference to 6 USC 796 at FAR 10.000; added language to FAR 10.001 regarding market research; added the requirement in FAR 18.102 for COs to consult the registry for available contractors; redesignated FAR 26.205 as FAR 26.206; added a new FAR 26.205, to inform COs on how to locate contractors on the registry; and made conforming amendments to FAR 13.201, the prefatory text in FAR 52.204-7, and FAR 52.226-3 through FAR 52.226-5.

Subcontract Reporting

The FAR Case 2010-008 interim rule amends the FAR to update procedures for subcontract reporting pursuant to the American Recovery and Reinvestment Act of 2009 (PL 111-5). FAC 2005-32 contained an interim rule (FAR Case 2009-009) to implement Section 1512 of the Recovery Act, which requires contractors to report on their use of Recovery Act funds. That interim rule added a new FAR Subpart 4.15, and a new clause, FAR 52.204-11, American Recovery and Reinvestment Act --Reporting Requirements, requiring contracting officers to include the clause in solicitations and contracts funded in whole or in part with Recovery Act funds, except classified solicitations and contracts. This interim rule revises FAR 52.204-11 and the prescription provision at FAR 4.1502 to require first-tier subcontractors, with Recovery Act funded awards of $25,000 or more, to report jobs information to the prime contractor for reporting into http://FederalReporting.gov. It also requires the prime contractor to submit its first report on or before the 10th day after the end of the calendar quarter in which the prime contractor received the award, and quarterly thereafter. The revised clause will be used for all new solicitations and awards issued on or after July 2, 2010, which is the effective date of this interim rule. This clause is not required for any existing contracts, or task and delivery orders issued under a contract, that contain the original clause FAR 52.204-11 (March 2009). This interim rule also makes a corresponding technical change to FAR 52.212-5.

Small Business

The amendments associated with the FAR Case 2008-023 final rule clarify the criteria required to conduct a sole source Service-disabled Veteran-owned Small Business concern acquisition (see 70,006.228 for the proposed rule). This final rule amends FAR 19.1306(a) to clarify the criteria for conducting sole source Historically Underutilized Business Zone small business concern acquisitions. This final rule also amends FAR 19.1406(a) to make the FAR language consistent with the Veterans Benefit Act of 2003 (15 USC 657f) and the Small Business Administration's regulation (SBA 125.20) that implements the Act. These amendments to the FAR alleviate confusion for contracting officers on the appropriate use of the criteria for sole source HUBZone small business and SDVOSB concern acquisitions.

Trade Thresholds

An interim rule, FAR Case 2009-040, amends the FAR to incorporate increased thresholds for application of the World Trade Organization Government Procurement Agreement and the Free Trade Agreements, as determined by the United States Trade Representative. The Trade Representative published the new procurement thresholds on December 29, 2010 (74 FR 68901), with a January 1, 2010, effective date. A table showing the new dollar thresholds appears at revised FAR 25.402. To implement these changes, this interim rule also amends FAR 22.1503, FAR 25.202, FAR 25.603, FAR 25.1101, FAR 25.1102, FAR 52.212-5, FAR 52.213-4, and FAR 52.222-19.




(The news featured above is a selection from the news covered in the Government Contracts Report Letter, which is published weekly and distributed to subscribers of the Government Contracts Reporter. )


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