Federal Acquisition Regulation; Environmentally Sound Products

DEPARTMENT OF DEFENSE

GENERAL SERVICES ADMINISTRATION

NATIONAL AERONAUTICS AND SPACE ADMINISTRATION

48 CFR Parts 1, 10, 11, 13, 15, 23, 36, 42, and 52

[FAC 97-01; FAR Case 92-054A; Item V]

RIN 9000-AG40

Federal Acquisition Regulation; Environmentally Sound Products

AGENCIES: Department of Defense (DoD), General Services Administration

(GSA), and National Aeronautics and Space Administration (NASA).

ACTION: Interim rule adopted as final with changes.

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SUMMARY: The Civilian Agency Acquisition Council and the Defense

Acquisition Regulations Council have agreed to adopt as final, with

changes, the interim rule published as Item II of Federal Acquisition

Circular 90-27 on May 31, 1995. The rule amends the Federal Acquisition

Regulation (FAR) to incorporate policies for the acquisition of

environmentally preferable and energy-efficient products and services.

This regulatory action was not subject to Office of Management and

Budget review under Executive Order 12866, dated September 30, 1993,

and is not a major rule under 5 U.S.C. 804.

DATE: Effective October 21, 1997.

FOR FURTHER INFORMATION CONTACT: The FAR Secretariat, Room 4035, GS

Building, Washington, DC 20405 (202) 501-4755 for information

pertaining to status or publication schedules. For clarification of

content, contact Mr. Ralph De Stefano, Procurement Analyst, at (202)

501-1758. Please cite FAC 97-01, FAR case 92-054A.

SUPPLEMENTARY INFORMATION:

A. Background

An interim rule was published in the Federal Register at 60 FR

28494, May 31, 1995. Ninety comments were received from 18 respondents.

The Councils' analysis of those comments resulted in revisions to

the rule to: revise the definitions of ``new'' and ``reconditioned'' at

11.001 and in the clause at 52.211-5; delete the definitions of

``material'' and ``other than new'' at 11.001 and in the clause at

52.211-5; add Executive Order No. 12909 of March 8, 1994, to the list

of statutory authorities at 11.002; clarify the policy on acceptability

of used, reconditioned, or remanufactured supplies, and former

Government surplus property proposed for use under a contract; delete

the definition of ``source reduction'' at 15.601; delete all

requirements related to ``agency designated items'' in Subpart 23.4;

add a definition of ``pollution prevention'' at 23.703; streamline the

clauses at 52.211-5 through 52.211-7 by combining their requirements

into the clause at 52.211-5; eliminate the solicitation provision at

52.223-8; and streamline the clause at 52.223-9.

B. Regulatory Flexibility Act

A Final Regulatory Flexibility Analysis (FRFA) has been performed.

A copy of the FRFA may be obtained from the FAR Secretariat. The FRFA

is summarized as follows:

This action is being taken to implement the Resource

Conservation and Recovery Act (RCRA) (42 U.S.C. 6901, et seq.), as

amended; Executive Order 12873, Federal Acquisition, Recycling, and

Waste Prevention; Executive Order 12902, Energy Efficiency and Water

Conservation at Federal Facilities; and Office of Federal

Procurement Policy (OFPP) Policy Letter 92-4, Procurement of

Environmentally-Sound and Energy-Efficient Products and Services.

The objective of this rule is to amend the FAR to clearly

reflect the Government's preference for the acquisition of

environmentally-sound and energy-efficient products and services and

to establish an affirmative procurement program favoring items

containing the maximum practicable content of recovered materials.

The rule also implements policies for procurement of items for which

the Environmental Protection Agency (EPA) has designated minimum

recovered material content.

We received no public comments which specifically addressed the

Initial Regulatory Flexibility Analysis.

The final rule's policies regarding acceptable new and used

materials apply to all small and large entities that perform or

propose to perform Government contracts. No statistics are

maintained on the number of offerors that propose used,

reconditioned, or remanufactured materials for use under Government

contracts.

The requirements for minimum recovered material content for EPA-

designated items apply to all entities that supply such items, with

a value exceeding $10,000 per year, to the Government. However, the

final rule exempts procurements under the simplified acquisition

threshold of $100,000 from recovered material content reporting

requirements. Based on Fiscal Year 1995 Governmentwide procurement

statistics for Federal Supply/Service Codes which comprise EPA-

designated items, we estimate that the Federal Government receives

approximately 20,875 covered proposals per year from small entities,

and awards approximately 2,280 covered contracts per year to small

entities.

Several reporting requirements were streamlined or eliminated in

this final rule. Certifications of recovered material content are

now required only in response to solicitations which are for, or

which specify the use of, EPA-designated items. Such certifications

are no longer required on an annual basis and are required only

under contracts which exceed the simplified acquisition threshold.

Reporting requirements related to agency-designated items have

been eliminated.

We considered elimination of the requirement that an offeror

notify the contracting officer when the offeror proposes the use of

used, remanufactured, or reconditioned supplies. However, we

determined that use of such supplies under many contracts might be

unacceptable. The notification requirement will allow contracting

officers to continue to decide on a case-by-case basis whether to

permit use of such supplies.

[[Page 44810]]

C. Paperwork Reduction Act

The Paperwork Reduction Act (44 U.S.C. 3501, et seq.) is deemed to

apply because the final rule contains information collection

requirements. The final rule reduces the information collection

requirements contained in the interim rule and approved by the Office

of Management and Budget (OMB) under OMB Control Number 9000-0134.

List of Subjects in 48 CFR Parts 1, 10, 11, 13, 15, 23, 36, 42, and

52

Government procurement.

Dated: August 7, 1997.

Edward C. Loeb,

Director, Federal Acquisition Policy Division.

Interim Rule Adopted as Final With Changes

Accordingly, the interim rule amending 48 CFR Parts 1, 7, 10, 11,

13, 15, 23, 36, 42, and 52, which was published at 60 FR 28494, May 31,

1995, is hereby adopted as final with the following changes:

1. The authority citation for 48 CFR Parts 1, 7, 10, 11, 13, 15,

23, 36, 42, 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).

PART 1--FEDERAL ACQUISITION REGULATIONS SYSTEM

1.106 [Amended]

2. Section 1.106 is amended in the list following the introductory

paragraph by removing the entries ``52.210-5'' and ``52.210-6'' and the

corresponding OMB control numbers ``9000-0030'' in both places; and by

adding the following entries in numerical order:

------------------------------------------------------------------------

OMB

FAR segment control No.

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* * * * *

52.211-5................................................... 9000-0030

* * * * *

52.223-4................................................... 9000-0134

* * * * *

52.223-8................................................... 9000-0134

* * * * *

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PART 11--DESCRIBING AGENCY NEEDS

3.-4. Section 11.001 is revised to read as follows:

11.001 Definitions.

As used in this part--

New means composed of previously unused components, whether

manufactured from virgin material, recovered material in the form of

raw material, or materials and by-products generated from, and reused

within, an original manufacturing process; provided that the supplies

meet contract requirements, including, but not limited to, performance,

reliability, and life expectancy.

Reconditioned means restored to the original normal operating

condition by readjustments and material replacement.

Recovered material has the meaning provided such term in 23.402.

Remanufactured means factory rebuilt to original specifications.

Virgin material means previously unused raw material, including

previously unused copper, aluminum, lead, zinc, iron, other metal or

metal ore, or any undeveloped resource that is, or with new technology

will become, a source of raw materials.

5. Section 11.002 is amended in paragraph (d) by revising the first

sentence to read as follows:

11.002 Policy.

* * * * *

(d) The Resource Conservation and Recovery Act of 1976 (42 U.S.C.

6901, et seq.), as amended, Executive Order 12873, dated October 20,

1993, and Executive Order 12902, dated March 8, 1994, establish

requirements for the procurement of products containing recovered

materials, and environmentally preferable and energy-efficient products

and services. * * *

* * * * *

6. Section 11.101 is amended by revising paragraph (b) to read as

follows:

11.101 Order of precedence for requirements documents.

* * * * *

(b) Agencies should prepare product descriptions to achieve maximum

practicable use of recovered material, other materials that are

environmentally preferable, and products that are energy-efficient (see

subparts 23.4 and 23.7).

7. Subpart 11.3, consisting of sections 11.301 and 11.302, is

revised to read as follows:

Subpart 11.3--Acceptable Material

11.301 Policy.

(a) Agencies shall not require virgin material or supplies composed

of or manufactured using virgin material unless compelled by law or

regulation or unless virgin material is vital for safety or meeting

performance requirements of the contract.

(b) Except when acquiring commercial items, agencies shall require

offerors to identify used, reconditioned, or remanufactured supplies,

or unused former Government surplus property, proposed for use under

the contract. Such supplies or property may not be used in contract

performance unless authorized by the contracting officer.

(c) When acquiring commercial items, the contracting officer shall

consider the customary practices in the industry for the item being

acquired. The contracting officer may require offerors to provide

information on used, reconditioned, or remanufactured supplies, or

unused former Government surplus property, proposed for use under the

contract. The request for such information shall be included in the

solicitation and shall, to the maximum practicable extent, be limited

to information provided pursuant to normal commercial practices.

11.302 Contract clause.

Except when acquiring commercial items, the contracting officer

shall insert the clause at 52.211-5, Material Requirements, in

solicitations and contracts for supplies.

PART 13--SIMPLIFIED ACQUISITION PROCEDURES

8. Section 13.111 is amended by revising paragraph (h) to read as

follows:

13.111 Inapplicable provisions and clauses.

* * * * *

(h) 52.223-9, Certification and Estimate of Percentage of Recovered

Material Content for EPA Designated Items.

PART 15--CONTRACTING BY NEGOTIATION

15.601 [Amended]

9. Section 15.601 is amended by removing the definition ``Source

reduction''.

10. Section 15.605 is amended by revising paragraph (b)(1)(iv) to

read as follows:

15.605 Evaluation factors and subfactors.

* * * * *

(b) * * *

(1) * * *

(iv) Environmental objectives, such as promoting waste reduction

and energy efficiency (see part 23), also shall be considered in every

source selection, when appropriate. These considerations may be

expressed in terms such as resource or energy conservation, pollution

prevention, waste minimization, and recovered material content.

* * * * *

[[Page 44811]]

PART 23--ENVIRONMENT, CONSERVATION, OCCUPATIONAL SAFETY, AND DRUG-

FREE WORKPLACE

11. Section 23.400 is revised to read as follows:

23.400 Scope of subpart.

This subpart prescribes policies and procedures for acquisition

of--

(a) Environmental Protection Agency (EPA) designated items for

which agencies must develop and implement affirmative procurement

programs pursuant to 42 U.S.C. 6901, et seq., and Executive Order

12873; and

(b) Other products when preference is given to offers of products

containing recovered material.

23.401 [Amended]

12. Section 23.401 is amended in the first sentence of paragraph

(c) by inserting ``as amended,'' following ``October 20, 1993,''.

13. Section 23.402 is amended by adding an introductory sentence

and revising the definitions ``EPA designated item'' and ``Postconsumer

material'' to read as follows:

23.402 Definitions.

As used in this subpart--

EPA designated item means an item--

(1) That is or can be made with recovered material;

(2) That is listed by EPA in a procurement guideline (40 CFR part

247); and

(3) For which EPA has provided purchasing recommendations in a

related Recovered Materials Advisory Notice (RMAN).

Postconsumer material means a material or finished product that has

served its intended use and has been diverted or recovered from waste

destined for disposal, having completed its life as a consumer item.

Postconsumer material is a part of the broader category of ``recovered

material.''

* * * * *

14. Sections 23.404 and 23.405 are revised to read as follows:

23.404 Procedures.

(a) Applicability. These procedures apply to all agency

acquisitions of EPA designated items when--

(1) The price of the item exceeds $10,000; or

(2) The aggregate amount paid for items, or for functionally

equivalent items, in the preceding fiscal year was $10,000 or more.

(b) EPA designated items. (1) EPA designates items that are or can

be made with recovered materials in 40 CFR part 247 and accompanying

RMAN's. The RMAN cites the applications for which the EPA items have

been designated and the percentages of recovered material content.

(2) For EPA designated items, agencies shall establish an

affirmative procurement program. The responsibilities for preparation,

implementation, and monitoring of affirmative procurement programs

shall be shared between technical or requirements personnel and

procurement personnel. As a minimum, such programs shall include--

(i) A recovered materials preference program;

(ii) An agency promotion program;

(iii) A program for requiring reasonable estimates, certification,

and verification of recovered material used in the performance of

contracts; and

(iv) Annual review and monitoring of the effectiveness of the

program.

(3) Acquisition of EPA designated items that do not meet the EPA

minimum recovered material standards shall be approved by an official

designated by the agency head based on a written determination that the

items--

(i) Are not available within a reasonable period of time;

(ii) Are available only at unreasonable prices;

(iii) Are not available from a sufficient number of sources to

maintain a satisfactory level of competition; or

(iv) Based on technical verification, fail to meet performance

standards in the specifications. Technical or requirements personnel

shall provide a written statement when this determination is used

partially or totally as a basis for an exemption. This determination

shall be made on the basis of National Institute of Standards and

Technology guidelines in any case in which the material is covered by

these guidelines.

(4) Contractor certifications required by the clause at 52.223-9

shall be consolidated and reported in accordance with agency

procedures.

23.405 Solicitation provision and contract clause.

(a) The contracting officer shall insert the provision at 52.223-4,

Recovered Material Certification, in solicitations that are for, or

specify the use of, recovered materials.

(b) The contracting officer shall insert the clause at 52.223-9,

Certification and Estimate of Percentage of Recovered Material Content

for EPA Designated Items, in contracts exceeding the simplified

acquisition threshold that are for, or specify the use of, an EPA

designated item.

15. Section 23.703 is amended by adding an introductory sentence

and, in alphabetical order, the definition ``Pollution prevention'';

and by revising the definition ``Waste prevention'' to read as follows:

23.703 Definitions.

As used in this subpart--

* * * * *

Pollution prevention means any practice that--

(1) Reduces the amount of any hazardous substance, pollutant, or

contaminant entering any waste stream or otherwise released into the

environment (including fugitive emissions) prior to recycling,

treatment, or disposal, and reduces the hazards to public health and

the environment associated with the release of such substances,

pollutants, and contaminants; or

(2) Reduces or eliminates the creation of pollutants through

increased efficiency in the use of raw materials, energy, water, or

other resources.

* * * * *

Waste prevention means any change in the design, manufacturing,

purchase, or use of materials or products (including packaging) to

reduce their amount or toxicity before they become municipal solid

waste. Waste prevention also refers to the reuse of products or

materials.

* * * * *

16. Section 23.704 is revised to read as follows:

23.704 Policy.

(a) Agencies shall implement cost-effective contracting preference

programs favoring the acquisition of environmentally preferable and

energy-efficient products and services, and shall employ acquisition

strategies that affirmatively implement the objectives in paragraph (b)

of this section.

(b) The following environmental objectives shall be addressed

throughout the acquisition process:

(1) Obtaining products and services considered to be

environmentally preferable (based on EPA-issued guidance).

(2) Obtaining products considered to be energy-efficient; i.e.,

products that are in the upper 25 percent of energy-efficiency for all

similar products, or products that are at least 10 percent more

efficient than the minimum level that meets Federal standards (see

Executive Order 12902, Section 507).

(3) Eliminating or reducing the generation of hazardous waste and

the need for special material processing (including special handling,

storage, treatment, and disposal).

[[Page 44812]]

(4) Promoting the use of nonhazardous and recovered materials.

(5) Realizing life-cycle cost savings.

(6) Promoting cost-effective waste reduction when creating plans,

drawings, specifications, standards, and other product descriptions

authorizing material substitutions, extensions of shelf-life, and

process improvements.

PART 36--CONSTRUCTION AND ARCHITECT-ENGINEER CONTRACTS

17. Section 36.601-3 is amended by revising paragraph (a) to read

as follows:

36.601-3 Applicable contracting procedures.

(a) For facility design contracts, the statement of work shall

require that the architect-engineer specify, in the construction design

specifications, use of the maximum practicable amount of recovered

materials consistent with the performance requirements, availability,

price reasonableness, and cost-effectiveness. Where appropriate, the

statement of work also shall require the architect-engineer to consider

energy conservation, pollution prevention, and waste reduction to the

maximum extent practicable in developing the construction design

specifications.

* * * * *

18. Section 36.602-1 is amended by revising paragraph (a)(2) to

read as follows:

36.602-1 Selection criteria.

(a) * * *

(2) Specialized experience and technical competence in the type of

work required, including, where appropriate, experience in energy

conservation, pollution prevention, waste reduction, and the use of

recovered materials;

* * * * *

19. Section 36.602-3 is amended by revising paragraph (c) to read

as follows:

36.602-3 Evaluation board functions.

* * * * *

(c) Hold discussions with at least three of the most highly

qualified firms regarding concepts and the relative utility of

alternative methods of furnishing the required services.

* * * * *

PART 42--CONTRACT ADMINISTRATION

20. Section 42.302 is amended by revising paragraph (a)(68)

introductory text and (a)(68)(i) to read as follows:

42.302 Contract administration functions.

(a) * * *

(68) Evaluate the contractor's environmental practices to determine

whether they adversely impact contract performance or contract cost,

and ensure contractor compliance with environmental requirements

specified in the contract. Contracting officer responsibilities

include, but are not limited to--

(i) Ensuring compliance with specifications requiring the use of

environmentally preferable and energy-efficient materials and the use

of materials or delivery of end items with the specified recovered

material content. This shall occur as part of the quality assurance

procedures set forth in part 46.

* * * * *

PART 52--SOLICITATION PROVISIONS AND CONTRACT CLAUSES

21. Section 52.211-5 is revised to read as follows:

52.211-5 Material Requirements.

As prescribed in 11.302, insert the following clause:

Material Requirements (Oct 1997)

(a) Definitions.

As used in this clause--

New means composed of previously unused components, whether

manufactured from virgin material, recovered material in the form of

raw material, or materials and by-products generated from, and

reused within, an original manufacturing process; provided that the

supplies meet contract requirements, including but not limited to,

performance, reliability, and life expectancy.

Reconditioned means restored to the original normal operating

condition by readjustments and material replacement.

Recovered material means waste materials and by-products that

have been recovered or diverted from solid waste including

postconsumer material, but such term does not include those

materials and by-products generated from, and commonly reused

within, an original manufacturing process.

Remanufactured means factory rebuilt to original specifications.

Virgin material means previously unused raw material, including

previously unused copper, aluminum, lead, zinc, iron, other metal or

metal ore, or any undeveloped resource that is, or with new

technology will become, a source of raw materials.

(b) Unless this contract otherwise requires virgin material or

supplies composed of or manufactured from virgin material, the

Contractor shall provide supplies that are new, as defined in this

clause.

(c) A proposal to provide unused former Government surplus

property shall include a complete description of the material, the

quantity, the name of the Government agency from which acquired, and

the date of acquisition.

(d) A proposal to provide used, reconditioned, or remanufactured

supplies shall include a detailed description of such supplies and

shall be submitted to the Contracting Officer for approval.

(e) Used, reconditioned, or remanufactured supplies, or unused

former Government surplus property, shall not be used unless the

Contractor has proposed the use of such supplies, and the

Contracting Officer has authorized their use.

(End of clause)

52.211-6 and 52.211-7 [Removed and Reserved]

22. Sections 52.211-6 and 52.211-7 are removed and reserved.

23. Section 52.223-4 is revised to read as follows:

52.223-4 Recovered Material Certification.

As prescribed in 23.405(a), insert the following provision:

Recovered Material Certification (Oct 1997)

As required by the Resource Conservation and Recovery Act of

1976 (42 U.S.C. 6962(c)(3)(A)(i)), the offeror certifies, by signing

this offer, that the percentage of recovered materials to be used in

the performance of the contract will be at least the amount required

by the applicable contract specifications.

(End of provision)

52.223-8 [Removed and reserved]

24. Section 52.223-8 is removed and reserved.

25. Section 52.223-9 is revised to read as follows:

52.223-9 Certification and Estimate of Percentage of Recovered

Material Content for EPA Designated Items.

As prescribed in 23.405(b), insert the following clause:

Certification and Estimate of Percentage of Recovered Material Content

For EPA Designated Items (Oct 1997)

(a) As required by the Resource Conservation and Recovery Act of

1976 (42 U.S.C. 6962(j)(2)(C)), the Contractor shall execute the

following certification:

Certification

I,________ (name of certifier), am an officer or employee

responsible for the performance of this contract and hereby certify

that the percentage of recovered material content for EPA Designated

Items was at least the amount required by the applicable contract

specifications.

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[Signature of the Officer or Employee]

----------------------------------------------------------------------

[Typed Name of the Officer or Employee]

----------------------------------------------------------------------

[Title]

----------------------------------------------------------------------

[Name of Company, Firm, or Organization]

----------------------------------------------------------------------

[Date]

(End of certification)

(b) The Contractor also shall estimate the percentage of

recovered materials actually used in the performance of this

contract. The estimate is in addition to the certification in

paragraph (a) of this clause.

[[Page 44813]]

Estimate

------------------------------------------------------------------------

Total

dollar Percentage

value of of

EPA designated item EPA recovered

designated material

item content *

------------------------------------------------------------------------

........... ...........

........... ...........

........... ...........

------------------------------------------------------------------------

* Where applicable, also include the percentage of postconsumer material

content.

(c) The Contractor shall submit this certification and estimate

upon completion of the contract to

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*To be completed in accordance with agency procedures.

(End of clause)

26. Section 52.223-10 is amended by revising the clause date and

paragraph (b) to read as follows:

52.223-10 Waste Reduction Program.

* * * * *

Waste Reduction Program (Oct 1997)

* * * * *

(b) Consistent with the requirements of Section 701 of Executive

Order 12873, the Contractor shall establish a program to promote

cost-effective waste reduction in all operations and facilities

covered by this contract. Any such program shall comply with

applicable Federal, State, and local requirements, specifically

including Section 6002 of the Resource Conservation and Recovery Act

(42 U.S.C. 6901, et seq.) and implementing regulations.

(End of clause)

[FR Doc. 97-21490 Filed 8-21-97; 8:45 am]

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