Federal Acquisition Regulation; Reorganization of FAR Part 13, Simplified Acquisition Procedures

Federal RegisterDec 9, 1997

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DEPARTMENT OF DEFENSE

GENERAL SERVICES ADMINISTRATION

NATIONAL AERONAUTICS AND SPACE ADMINISTRATION

48 CFR Parts 4, 6, 8, 12, 13, 16, 19, 32, 41, 43, 49, 52, and 53

[FAC 97-03; FAR Case 94-772; Item IV]

RIN 9000-AH24

Federal Acquisition Regulation; Reorganization of FAR Part 13,

Simplified Acquisition Procedures

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

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

ACTION: Final rule.

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SUMMARY: The Civilian Agency Acquisition Council and the Defense

Acquisition Regulations Council have agreed on a final rule amending

the Federal Acquisition Regulation (FAR) to reorganize part 13 for

clarity and to make other changes to facilitate the use of electronic

commerce in Government contracting. This regulatory action was not

subject to Office of Management and Budget review under Executive Order

12866, dated September 30, 1993. This is not a major rule under 5

U.S.C. 804.

EFFECTIVE DATE: February 9, 1998.

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. Paul Linfield, Procurement Analyst, at (202) 501-

1757. Please cite FAC 97-03, FAR case 94-772.

SUPPLEMENTARY INFORMATION:

A. Background

This final rule revises FAR part 13 to reorganize its contents in a

more process-oriented manner and to emphasize the use of electronic

contracting and the Governmentwide commercial purchase card. FAR part

52 is amended to permit agency provisions and clauses to be

incorporated by reference in solicitations and contracts, if the full

text of the provisions and clauses may be accessed electronically by

prospective contractors. A new clause is added at FAR 52.213-4 for use

in simplified acquisitions; the clause is a compilation of the required

and most commonly used clauses that apply to simplified acquisitions,

and may be used in lieu of individual clauses prescribed in the FAR.

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This effort was initiated as a result of public comments received

during the comment period on FAR case 94-770, published in the Federal

rule was published in the Federal Register on September 13, 1996 (61 FR

48532).

Thirteen public comments were received in response to the proposed

rule. All comments were considered in the development of the final

rule.

B. Regulatory Flexibility Act

A Final Regulatory Flexibility Analysis has been performed. A copy

of the analysis may be obtained from the FAR Secretariat. The analysis

is summarized as follows:

This rule amends the Federal Acquisition Regulation (FAR) by

reorganizing the structure and material of part 13 in a manner that

would be clear to those individuals that are newly authorized to

make micro-purchases. The Federal Acquisition Streamlining Act of

1994 (FASA) (Pub. L. 103-355) authorized individuals other than

contracting officers to make purchases under $2,500 (micro-

purchases). Also, the rule takes into account the anticipated impact

on the workload of agency procurement personnel of evaluating the

many sources that may respond electronically to contract actions

that are initiated with widespread electronic public notice. Changes

made by the rule will better enable agencies to capture the benefits

of using electronic commerce in these situations. There were no

public comments received in response to the initial regulatory

flexibility analysis. Changes in FAR part 52 may affect a

significant number of small entities that participate in Federal

agency procurements. The provisions and clauses in this FAR part

generally are not required for micro-purchases. It is estimated that

40 percent of the contract actions below $25,000 are micro-

purchases. Approximately 50 percent of all contract actions of

$100,000 or less are annually awarded to small business concerns.

The rule will impose no new reporting, recordkeeping, or other

compliance requirements on large or small entities. The changes to

part 52 may have more impact on small business concerns than large

business concerns because these changes make it more imperative that

small business concerns have electronic capability to receive and

transmit procurement information. This rule authorizes the

incorporation by reference of any provision or clause used by an

agency contracting activity, provided that provision or clause was

accessible electronically to an offeror or prospective contractor.

The changes in part 52 should also result in a reduction in the

number of pages that a prospective contractor will have to submit

with its offer to the Government. An alternative that was considered

was making solicitation provisions and clauses available to

prospective contractors at the time they registered with the Central

Contractor Registration (CCR). In order to conduct electronic

commerce with any agency of the Federal Government, a potential

contractor must register with the CCR. However, providing provisions

and clauses at the time of registration with the CCR does not appear

to be practical, since the prospective contractor would not have any

assurance that the provisions and clauses were current at the time

it wanted to participate in an agency procurement.

C. Paperwork Reduction Act

The Paperwork Reduction Act does not apply because the changes to

the FAR do not impose recordkeeping or information collection

requirements, or collections of information from offerors, contractors,

or members of the public which require the approval of the Office of

Management and Budget under 44 U.S.C. 3501, et seq.

List of Subjects in 48 CFR Parts 4, 6, 8, 12, 13, 16, 19, 32, 41, 43,

49, 52, and 53

Government procurement.

Dated: December 1, 1997.

Edward C. Loeb,

Director, Federal Acquisition Policy Division.

Therefore, 48 CFR parts 4, 6, 8, 12, 13, 16, 19, 32, 41, 43, 49,

52, and 53 are amended as set forth below:

1. The authority citation for 48 CFR parts 4, 6, 8, 12, 13, 6, 19,

32, 41, 43, 49, 52, and 53 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 4--ADMINISTRATIVE MATTERS

4.800 [Amended]

2. Section 4.800 is amended to revise the reference in the

parenthetical to read ``13.106-3(b)''.

PART 6--COMPETITION REQUIREMENTS

6.001 [Amended]

3. Section 6.001 is amended in paragraph (a) by revising the

references ``13.602'' and ``subpart 13.6'' to read ``13.501'' and

``subpart 13.5'', respectively.

PART 8--REQUIRED SOURCES OF SUPPLIES AND SERVICES

8.404 [Amended]

4. Section 8.404 is amended in the first sentence of paragraph

(b)(4) by revising the parenthetical to read ``(see 13.303-2(c)(3))''.

PART 12--ACQUISITION OF COMMERCIAL ITEMS

5. Section 12.102 is amended by revising paragraphs (d)(2) and

(d)(3) to read as follows:

12.102 Applicability.

* * * * *

(d) * * *

(2) Using the Standard Form 44 (see 13.306);

(3) Using the imprest fund (see 13.305); or

* * * * *

12.203 [Amended]

6. Section 12.203 is amended in the last sentence of the

undesignated paragraph by revising the reference ``subpart 13.6'' to

read ``subpart 13.5''.

12.206, 12.301, and 12.602 [Amended]

7. In the following sections, remove ``13.106-2'' and insert

``13.106'': 12.206, 12.301(c)(2), 12.602(a), and 12.602(b).

8. Part 13 is revised to read as follows:

PART 13--SIMPLIFIED ACQUISITION PROCEDURES

13.000 Scope of part.

13.001 Definitions.

13.002 Purpose.

13.003 Policy.

13.004 Legal effect of quotations.

13.005 Federal Acquisition Streamlining Act of 1994 list of

inapplicable laws.

13.006 Inapplicable provisions and clauses.

Subpart 13.1--Procedures

13.101 General.

13.102 Source list.

13.103 Use of standing price quotations.

13.104 Promoting competition.

13.105 Synopsis and posting requirements.

13.106 Soliciting competition, evaluation of quotations or offers,

award and documentation.

13.106-1 Soliciting competition.

13.106-2 Evaluation of quotations or offers.

13.106-3 Award and documentation.

Subpart 13.2--Actions at or Below the Micro-Purchase Threshold

13.201 General.

13.202 Purchase guidelines.

Subpart 13.3--Simplified Acquisition Methods

13.301 Governmentwide commercial purchase card.

13.302 Purchase orders.

13.302-1 General.

13.302-2 Unpriced purchase orders.

13.302-3 Obtaining contractor acceptance and modifying purchase

orders.

13.302-4 Termination or cancellation of purchase orders.

13.302-5 Clauses.

13.303 Blanket purchase agreements (BPAs).

13.303-1 General.

13.303-2 Establishment of BPAs.

13.303-3 Preparation of BPAs.

13.303-4 Clauses.

13.303-5 Purchases under BPAs.

13.303-6 Review procedures.

13.303-7 Completion of BPAs.

13.303-8 Optional clause.

13.304 [Reserved]

13.305 Imprest funds and third party drafts.

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13.305-1 General.

13.305-2 Agency responsibilities.

13.305-3 Conditions for use.

13.305-4 Procedures.

13.306 SF 44, Purchase Order--Invoice--Voucher.

13.307 Forms.

Subpart 13.4--Fast Payment Procedure

13.401 General.

13.402 Conditions for use.

13.403 Preparation and execution of orders.

13.404 Contract clause.

Subpart 13.5--Test Program for Certain Commercial Items

13.500 General.

13.501 Special documentation requirements.

13.000 Scope of part.

This part prescribes policies and procedures for the acquisition of

supplies and services, including construction, research and

development, and commercial items, the aggregate amount of which does

not exceed the simplified acquisition threshold (see 2.101). Subpart

13.5 provides special authority for acquisitions of commercial items

exceeding the simplified acquisition threshold but not exceeding

$5,000,000, including options. See part 12 for policies applicable to

the acquisition of commercial items exceeding the micro-purchase

threshold. See 36.602-5 for simplified procedures to be used when

acquiring architect-engineer services.

13.001 Definitions.

As used in this part--

Authorized individual means a person who has been granted

authority, in accordance with agency procedures, to acquire supplies

and services in accordance with this part.

Governmentwide commercial purchase card means a purchase card,

similar in nature to a commercial credit card, issued to authorized

agency personnel to use to acquire and to pay for supplies and

services.

Imprest fund means a cash fund of a fixed amount established by an

advance of funds, without charge to an appropriation, from an agency

finance or disbursing officer to a duly appointed cashier, for

disbursement as needed from time to time in making payment in cash for

relatively small amounts.

Purchase order means an offer by the Government to buy supplies or

services, including construction and research and development, upon

specified terms and conditions, using simplified acquisition

procedures.

Third party draft means an agency bank draft, similar to a check,

that is used to acquire and to pay for supplies and services. (See

Treasury Financial Management Manual, Section 3040.70.)

13.002 Purpose.

The purpose of this part is to prescribe simplified acquisition

procedures in order to--

(a) Reduce administrative costs;

(b) Improve opportunities for small, small disadvantaged, and

women-owned small business concerns to obtain a fair proportion of

Government contracts;

(d) Avoid unnecessary burdens for agencies and contractors.

13.003 Policy.

(a) Agencies shall use simplified acquisition procedures to the

maximum extent practicable for all purchases of supplies or services

not exceeding the simplified acquisition threshold (including purchases

at or below the micro-purchase threshold). This policy does not apply

if an agency can meet its requirement using--

(1) Required sources of supply under part 8 (e.g., Federal Prison

Industries, Committee for Purchase from People Who are Blind or

Severely Disabled, and Federal Supply Schedule contracts);

(2) Existing indefinite delivery/indefinite quantity contracts; or

(3) Other established contracts.

(b)(1) Each acquisition of supplies or services that has an

anticipated dollar value exceeding $2,500 and not exceeding $100,000 is

reserved exclusively for small business concerns and shall be set aside

(see 19.000 and subpart 19.5). See 19.502-2 for exceptions.

(2) Each written solicitation under a set-aside shall contain the

appropriate provisions prescribed by part 19. If the solicitation is

oral, however, information substantially identical to that in the

provision shall be given to potential quoters.

procedures for contract actions exceeding $50,000 after December 31,

1999, only if the office's cognizant agency has certified full FACNET

capability in accordance with 4.505-2. This limitation does not apply

to acquisitions of commercial items conducted using subpart 13.5.

(d) The contracting officer shall not use simplified acquisition

procedures to acquire supplies and services if the anticipated award

will exceed the simplified acquisition threshold (or $5,000,000,

including options, for acquisitions of commercial items using Subpart

13.5). Do not break down requirements aggregating more than the

simplified acquisition threshold (or for commercial items, the

threshold in subpart 13.5) or the micro-purchase threshold into several

purchases that are less than the applicable threshold merely to--

(1) Permit use of simplified acquisition procedures; or

(2) Avoid any requirement that applies to purchases exceeding the

micro-purchase threshold.

(e) An agency that has specific statutory authority to acquire

personal services (see 37.104) may use simplified acquisition

procedures to acquire those services.

(f) Agencies shall use the Governmentwide commercial purchase card

and electronic purchasing techniques to the maximum extent practicable

in conducting simplified acquisitions.

(g) For contract actions exceeding the micro-purchase threshold but

not exceeding the simplified acquisition threshold, agencies shall

maximize the use of FACNET, when practicable and cost-effective (see

4.506), to acquire supplies and services (including construction,

research and development, and architect-engineer). FACNET also may be

used for contract actions exceeding the simplified acquisition

threshold. Drawings and lengthy specifications can be provided off-line

in hard copy or through other appropriate means.

(h) Authorized individuals shall make purchases in the simplified

manner that is most suitable, efficient, and economical based on the

circumstances of each acquisition. For acquisitions not expected to

exceed--

(1) The simplified acquisition threshold for other than commercial

items, use any appropriate combination of the procedures in parts 13,

14, 15, 35, or 36, including the use of Standard Form 1442,

Solicitation, Offer, and Award (Construction, Alteration, or Repair),

for construction contracts (see 36.701(b)); or

(2) $5 million for commercial items, use any appropriate

combination of the procedures in parts 12, 13, 14, and 15 (see

paragraph (d) of this section).

(i) In addition to other considerations, contracting officers

shall--

(1) Promote competition to the maximum extent practicable (see

13.104);

(2) Establish deadlines for the submission of responses to

solicitations that afford suppliers a reasonable opportunity to respond

(see 5.203);

(3) Consider all quotations or offers that are timely received. For

evaluation of quotations or offers conducted

[[Page 64919]]

through FACNET, see 13.106-2(b)(3); and

(4) Use innovative approaches, to the maximum extent practicable,

in awarding contracts using simplified acquisition procedures.

13.004 Legal effect of quotations.

(a) A quotation is not an offer and, consequently, cannot be

accepted by the Government to form a binding contract. Therefore,

issuance by the Government of an order in response to a supplier's

quotation does not establish a contract. The order is an offer by the

Government to the supplier to buy certain supplies or services upon

specified terms and conditions. A contract is established when the

supplier accepts the offer.

(b) When appropriate, the contracting officer may ask the supplier

to indicate acceptance of an order by notification to the Government,

preferably in writing, as defined at 2.101. In other circumstances, the

supplier may indicate acceptance by furnishing the supplies or services

ordered or by proceeding with the work to the point where substantial

performance has occurred.

the Government may (by written notice to the supplier, at any time

before acceptance occurs) withdraw, amend, or cancel its offer. (See

13.302-4 for procedures on termination or cancellation of purchase

orders.)

13.005 Federal Acquisition Streamlining Act of 1994 list of

inapplicable laws.

(a) The following laws are inapplicable to all contracts and

subcontracts (if otherwise applicable to subcontracts) at or below the

simplified acquisition threshold:

(1) 41 U.S.C. 57(a) and (b) (Anti-Kickback Act of 1986). (Only the

requirement for the incorporation of the contractor procedures for the

prevention and detection of violations, and the contractual requirement

for contractor cooperation in investigations are inapplicable.).

(2) 40 U.S.C. 270a (Miller Act). (Although the Miller Act does not

apply to contracts at or below the simplified acquisition threshold,

alternative forms of payment protection for suppliers of labor and

material (see 28.102) are still required if the contract exceeds

$25,000.).

(3) 40 U.S.C. 327--333 (Contract Work Hours and Safety Standards

Act--Overtime Compensation).

(4) 41 U.S.C. 701(a)(1) (Section 5152 of the Drug-Free Workplace

Act of 1988), except for individuals.

(5) 42 U.S.C. 6962 (Solid Waste Disposal Act). (Only the

requirement for providing the estimate of recovered material utilized

in the performance of the contract is inapplicable.)

(6) 10 U.S.C. 2306(b) and 41 U.S.C. 254(a) (Contract Clause

Regarding Contingent Fees).

(7) 10 U.S.C. 2313 and 41 U.S.C. 254(c) (Authority to Examine Books

and Records of Contractors).

(8) 10 U.S.C. 2402 and 41 U.S.C. 253g (Prohibition on Limiting

Subcontractor Direct Sales to the United States).

(b) The Federal Acquisition Regulatory (FAR) Council will include

any law enacted after October 13, 1994, that sets forth policies,

procedures, requirements, or restrictions for the acquisition of

property or services, on the list set forth in paragraph (a) of this

section. The FAR Council may make exceptions when it determines in

writing that it is in the best interest of the Government that the

enactment should apply to contracts or subcontracts not greater than

the simplified acquisition threshold.

laws that--

(1) Provide for criminal or civil penalties; or

(2) Specifically state that notwithstanding the language of Section

4101, Public Law 103-355, the enactment will be applicable to contracts

or subcontracts in amounts not greater than the simplified acquisition

threshold.

(d) Any individual may petition the Administrator, Office of

Federal Procurement Policy (OFPP), to include any applicable provision

of law not included on the list set forth in paragraph (a) of this

section unless the FAR Council has already determined in writing that

the law is applicable. The Administrator, OFPP, will include the law on

the list in paragraph (a) of this section unless the FAR Council makes

a determination that it is applicable within 60 days of receiving the

petition.

13.006 Inapplicable provisions and clauses.

While certain statutes still apply, pursuant to Public Law 103-355,

the following provisions and clauses are inapplicable to contracts and

subcontracts at or below the simplified acquisition threshold:

(a) 52.203-5, Covenant Against Contingent Fees.

(b) 52.203-6, Restrictions on Subcontractor Sales to the

Government.

(d) 52.215-2, Audits and Records--Negotiation.

(e) 52.222-4, Contract Work Hours and Safety Standards Act--

Overtime Compensation.

(f) 52.223-6, Drug-Free Workplace, except for individuals.

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

Material Content for EPA Designated Items.

Subpart 13.1--Procedures

13.101 General.

(a) In making purchases, contracting officers shall--

(1) Comply with the policy in 7.202 relating to economic purchase

quantities, when practicable;

(2) Satisfy the procedures described in subpart 19.6 with respect

to Certificates of Competency before rejecting a quotation, oral or

written, from a small business concern determined to be nonresponsible

(see subpart 9.1);

(3) Use United States-owned excess or near-excess foreign currency,

if appropriate, in making payments under simplified acquisition

procedures (see subpart 25.3); and

(4) Provide for the inspection of supplies or services as

prescribed in 46.404.

(b) In making purchases, contracting officers should--

(1) Include related items (such as small hardware items or spare

parts for vehicles) in one solicitation and make award on an ``all-or-

none'' or ``multiple award'' basis provided suppliers are so advised

when quotations or offers are requested;

(2) Incorporate provisions and clauses by reference in

solicitations and in awards under requests for quotations, provided the

requirements in 52.102 are satisfied;

(3) Make maximum effort to obtain trade and prompt payment

discounts (see 14.408-3). Prompt payment discounts shall not be

considered in the evaluation of quotations; and

(4) Use bulk funding to the maximum extent practicable. Bulk

funding is a system whereby the contracting officer receives

authorization from a fiscal and accounting officer to obligate funds on

purchase documents against a specified lump sum of funds reserved for

the purpose for a specified period of time rather than obtaining

individual obligational authority on each purchase document. Bulk

funding is particularly appropriate if numerous purchases using the

same type of funds are to be made during a given period.

13.102 Source list.

(a) Each contracting office should maintain a source list (or

lists, if more

[[Page 64920]]

convenient). New supply sources for the list may be obtained from a

variety of sources, including the Procurement Automated Source System

(PASS) of the Small Business Administration and the Central Contractor

Registration (CCR) Data Base (see 4.503). The list should identify the

status of each source (when the status is made known to the contracting

office) in the following categories:

(1) Small business.

(2) Small disadvantaged business.

(3) Women-owned small business.

(b) The status information may be used as the basis to ensure that

small business concerns are provided the maximum practicable

opportunities to respond to solicitations issued using simplified

acquisition procedures.

13.103 Use of standing price quotations.

Authorized individuals do not have to obtain individual quotations

for each purchase. Standing price quotations may be used if--

(a) The pricing information is current; and

(b) The Government obtains the benefit of maximum discounts before

award.

13.104 Promoting competition.

The contracting officer shall promote competition to the maximum

extent practicable to obtain supplies and services from the source

whose offer is the most advantageous to the Government, considering the

administrative cost of the purchase.

(a) The contracting officer shall not--

(1) Solicit quotations based on personal preference; or

(2) Restrict solicitation to suppliers of well-known and widely

distributed makes or brands.

(b) If using simplified acquisition procedures and not using

FACNET, maximum practicable competition ordinarily can be obtained by

soliciting quotations or offers from sources within the local trade

area. Unless the contract action requires synopsis pursuant to 5.101

and an exception under 5.202 is not applicable, consider solicitation

of at least three sources to promote competition to the maximum extent

practicable. Whenever practicable, request quotations or offers from

two sources not included in the previous solicitation.

13.105 Synopsis and posting requirements.

(a) The contracting officer shall comply with the public display

and synopsis requirements of 5.101 and 5.203 unless--

(1) FACNET is used for an acquisition at or below the simplified

acquisition threshold; or

(2) An exception in 5.202 applies.

(b) When acquiring commercial items, the contracting officer may

use a combined synopsis/solicitation. In such cases, a separate

solicitation is not required. The contracting officer must include

enough information to permit suppliers to develop quotations or offers.

13.106 Soliciting competition, evaluation of quotations or offers,

award and documentation.

13.106-1 Soliciting competition.

(a) Considerations. In soliciting competition, the contracting

officer shall consider the guidance in 13.104 and the following before

requesting quotations or offers:

(1)(i) The nature of the article or service to be purchased and

whether it is highly competitive and readily available in several makes

or brands, or is relatively noncompetitive.

(ii) Information obtained in making recent purchases of the same or

similar item.

(iii) The urgency of the proposed purchase.

(iv) The dollar value of the proposed purchase.

(v) Past experience concerning specific dealers' prices.

(2) When soliciting quotations or offers, the contracting officer

shall notify potential quoters or offerors of the basis on which award

will be made (price alone or price and other factors, e.g., past

performance and quality). Contracting officers are encouraged to use

best value. Solicitations are not required to state the relative

importance assigned to each evaluation factor and subfactor, nor are

they required to include subfactors.

(b) Soliciting from a single source. (1) For purchases not

exceeding the simplified acquisition threshold, contracting officers

may solicit from one source if the contracting officer determines that

the circumstances of the contract action deem only one source

reasonably available (e.g., urgency, exclusive licensing agreements, or

industrial mobilization).

(2) For sole source acquisitions of commercial items in excess of

the simplified acquisition threshold conducted pursuant to subpart

13.5, the requirements at 13.501(a) apply.

quotations orally to the maximum extent practicable, if--

(i) The acquisition does not exceed the simplified acquisition

threshold;

(ii) FACNET is not available or the contracting office has a

written determination that it is not practicable or cost-effective to

purchase via FACNET (see 4.506); and

(iii) Notice is not required under 5.101.

(2) However, an oral solicitation may not be practicable for

contract actions exceeding $25,000 unless covered by an exception in

5.202.

(d) Written solicitations. If obtaining electronic or oral

quotations is uneconomical or impracticable, the contracting officer

should issue paper solicitations for contract actions likely to exceed

$25,000. The contracting officer shall issue a written solicitation for

construction requirements exceeding $2,000.

(e) Use of options. Options may be included in solicitations,

provided the requirements of subpart 17.2 are met and the aggregate

value of the acquisition and all options does not exceed the dollar

threshold for use of simplified acquisition procedures.

(f) Inquiries. An agency should respond to inquiries received

through any medium (including FACNET) if doing so would not interfere

with the efficient conduct of the acquisition. For an acquisition

conducted through FACNET, an agency must respond to telephonic or

facsimile inquiries only if it is unable to receive inquiries through

FACNET.

13.106-2 Evaluation of quotations or offers.

(a) General. (1) The contracting officer shall evaluate quotations

or offers--

(i) In an impartial manner; and

(ii) Inclusive of transportation charges from the shipping point of

the supplier to the delivery destination.

(2) Quotations or offers shall be evaluated on the basis

established in the solicitation.

(3) All quotations or offers shall be considered (see paragraph (b)

of this subsection).

(b) Evaluation procedures. (1) The contracting officer has broad

discretion in fashioning suitable evaluation procedures. The procedures

prescribed in parts 14 and 15 are not mandatory. At the contracting

officer's discretion, one or more, but not necessarily all, of the

evaluation procedures in part 14 or 15 may be used.

(2) If using price and other factors, ensure that quotations or

offers can be evaluated in an efficient and minimally burdensome

fashion. Formal evaluation plans and establishing a competitive range,

conducting discussions, and scoring quotations or offers are not

required. Contracting offices may

[[Page 64921]]

conduct comparative evaluations of offers. Evaluation of other factors,

such as past performance--

(i) Does not require the creation or existence of a formal data

base; and

(ii) May be based on information such as the contracting officer's

knowledge of and previous experience with the supply or service being

acquired, customer surveys, or other reasonable basis.

(3) For acquisitions conducted using FACNET, the contracting

officer may--

(i) After preliminary consideration of all quotations or offers,

identify from all quotations or offers received one that is suitable to

the user, such as the lowest priced brand name product, and quickly

screen all lower priced quotations or offers based on readily

discernible value indicators, such as past performance, warranty

conditions, and maintenance availability; or

(ii) Where an evaluation is based only on price and past

performance, make an award based on whether the lowest priced of the

quotations or offers having the highest past performance rating

possible represents the best value when compared to any lower priced

quotation or offer.

13.106-3 Award and documentation.

(a) Basis for award. Before making award, the contracting officer

shall determine that the proposed price is fair and reasonable.

(1) Whenever possible, base price reasonableness on competitive

quotations or offers.

(2) If only one response is received, include a statement of price

reasonableness in the contract file. The statement may be based on--

(i) Market research;

(ii) Comparison of the proposed price with prices found reasonable

on previous purchases;

(iii) Current price lists, catalogs, or advertisements;

(iv) A comparison with similar items in a related industry;

(v) Value analysis;

(vi) The contracting officer's personal knowledge of the item being

purchased;

(vii) Comparison to an independent Government estimate; or

(viii) Any other reasonable basis.

(3) Occasionally an item can be obtained only from a supplier that

quotes a minimum order price or quantity that either unreasonably

exceeds stated quantity requirements or results in an unreasonable

price for the quantity required. In these instances, the contracting

officer should inform the requiring activity of all facts regarding the

quotation or offer and ask it to confirm or alter its requirement. The

file shall be documented to support the final action taken.

(b) File documentation and retention. Keep documentation to a

minimum. Purchasing offices shall retain data supporting purchases

(paper or electronic) to the minimum extent and duration necessary for

management review purposes (see subpart 4.8). The following illustrate

the extent to which quotation or offer information should be recorded:

(1) Oral solicitations. The contracting office should establish and

maintain records of oral price quotations in order to reflect clearly

the propriety of placing the order at the price paid with the supplier

concerned. In most cases, this will consist merely of showing the names

of the suppliers contacted and the prices and other terms and

conditions quoted by each.

(2) Written solicitations (see 2.101). For acquisitions not

exceeding the simplified acquisition threshold, limit written records

of solicitations or offers to notes or abstracts to show prices,

delivery, references to printed price lists used, the supplier or

suppliers contacted, and other pertinent data.

(3) Special situations. Include additional statements--

(i) Explaining the absence of competition if only one source is

solicited and the acquisition does not exceed the simplified

acquisition threshold (does not apply to an acquisition of utility

services available from only one source); or

(ii) Supporting the award decision if other than price-related

factors were considered in selecting the supplier.

simplified acquisition threshold and for which automatic notification

is not provided through FACNET, notification to unsuccessful suppliers

shall be given only if requested or required by 5.301.

(d) Request for information. If a supplier requests information on

an award that was based on factors other than price alone, a brief

explanation of the basis for the contract award decision shall be

provided (see 15.503(b)(2)).

Subpart 13.2--Actions at or Below the Micro-Purchase Threshold

13.201 General.

(a) Agency heads are encouraged to delegate micro-purchase

authority (see 1.603-3).

(b) The Governmentwide commercial purchase card shall be the

preferred method to purchase and to pay for micro-purchases (see

2.101).

conducted using any of the methods described in subpart 13.3, provided

the purchaser is authorized and trained, pursuant to agency procedures,

to use those methods.

(d) Micro-purchases do not require provisions or clauses, except as

provided at 32.1103. This paragraph takes precedence over any other FAR

requirement to the contrary, but does not prohibit the use of any

clause.

(e) The requirements in part 8 apply to purchases at or below the

micro-purchase threshold.

13.202 Purchase guidelines.

(a) Solicitation, evaluation of quotations, and award. (1) To the

extent practicable, micro-purchases shall be distributed equitably

among qualified suppliers.

(2) Micro-purchases may be awarded without soliciting competitive

quotations if the contracting officer or individual appointed in

accordance with 1.603-3(b) considers the price to be reasonable.

(3) The administrative cost of verifying the reasonableness of the

price for purchases may more than offset potential savings from

detecting instances of overpricing. Therefore, action to verify price

reasonableness need only be taken if--

(i) The contracting officer or individual appointed in accordance

with 1.603-3(b) suspects or has information to indicate that the price

may not be reasonable (e.g., comparison to the previous price paid or

personal knowledge of the supply or service); or

(ii) Purchasing a supply or service for which no comparable pricing

information is readily available (e.g., a supply or service that is not

the same as, or is not similar to, other supplies or services that have

recently been purchased on a competitive basis).

(b) Documentation. If competitive quotations were solicited and

award was made to other than the low quoter, documentation to support

the purchase may be limited to identification of the solicited concerns

and an explanation for the award decision.

Subpart 13.3--Simplified Acquisition Methods

13.301 Governmentwide commercial purchase card.

(a) The Governmentwide commercial purchase card is authorized for

use in making and/or paying for purchases of supplies, services, or

construction. The Governmentwide commercial purchase card may be used

by contracting officers and other individuals designated in accordance

with 1.603-3. The card may

[[Page 64922]]

be used only for purchases that are otherwise authorized by law or

regulation.

(b) Agencies using the Governmentwide commercial purchase card

shall establish procedures for use and control of the card that comply

with the Treasury Financial Manual for Guidance of Departments and

Agencies (TFM 4-4500) and that are consistent with the terms and

conditions of the GSA Federal Supply Service Contract Guide for

Governmentwide Commercial Purchase Card Service. Agency procedures

should not limit the use of the Governmentwide commercial purchase card

to micro-purchases. Agency procedures should encourage use of the card

in greater dollar amounts by contracting officers to place orders and

to pay for purchases against contracts established under part 8

procedures, when authorized; and to place orders and/or make payment

under other contractual instruments, when agreed to by the contractor.

(1) Make micro-purchases;

(2) Place a task or delivery order (if authorized in the basic

contract, basic ordering agreement, or blanket purchase agreement); or

(3) Make payments, when the contractor agrees to accept payment by

the card.

13.302 Purchase orders.

13.302-1 General.

(a) Except as provided under the unpriced purchase order method

(see 13.302-2), purchase orders generally are issued on a fixed-price

basis. See 12.207 for acquisition of commercial items.

(b) Purchase orders shall--

(1) Specify the quantity of supplies or scope of services ordered;

(2) Contain a determinable date by which delivery of the supplies

or performance of the services is required;

(3) Provide for inspection as prescribed in part 46. Generally,

inspection and acceptance should be at destination. Source inspection

should be specified only if required by part 46. When inspection and

acceptance will be performed at destination, advance copies of the

purchase order or equivalent notice shall be furnished to the

consignee(s) for material receipt purposes. Receiving reports shall be

accomplished immediately upon receipt and acceptance of supplies;

(4) Specify f.o.b. destination for supplies to be delivered within

the United States, except Alaska or Hawaii, unless there are valid

reasons to the contrary; and

(5) Include any trade and prompt payment discounts that are

offered, consistent with the applicable principles at 14.408-3.

in accordance with 4.101 and the definitions at 2.101. Facsimile and

electronic signature may be used in the production of purchase orders

by automated methods.

(d) Limit the distribution of copies of purchase orders and related

forms to the minimum deemed essential for administration and

transmission of contractual information.

(e) In accordance with 31 U.S.C. 3332, electronic funds transfer

(EFT) may be required for payments. See 32.1103 for instructions for

use of the appropriate clause in purchase orders. When obtaining verbal

quotes, the contracting officer shall inform the quoter of the EFT

clause that will be in any resulting purchase order. Contracting

officers shall not accept EFT payment data. The contractor shall

provide all such data directly to the payment office.

13.302-2 Unpriced purchase orders.

(a) An unpriced purchase order is an order for supplies or

services, the price of which is not established at the time of issuance

of the order.

(b) An unpriced purchase order may be used only when--

(1) It is impractical to obtain pricing in advance of issuance of

the purchase order; and

(2) The purchase is for--

(i) Repairs to equipment requiring disassembly to determine the

nature and extent of repairs;

(ii) Material available from only one source and for which cost

cannot readily be established; or

(iii) Supplies or services for which prices are known to be

competitive, but exact prices are not known (e.g., miscellaneous repair

parts, maintenance agreements).

electronically. A realistic monetary limitation, either for each line

item or for the total order, shall be placed on each unpriced purchase

order. The monetary limitation shall be an obligation subject to

adjustment when the firm price is established. The contracting office

shall follow up on each order to ensure timely pricing. The contracting

officer or the contracting officer's designated representative shall

review the invoice price and, if reasonable (see 13.106-3(a)), process

the invoice for payment.

13.302-3 Obtaining contractor acceptance and modifying purchase

orders.

(a) When it is desired to consummate a binding contract between the

parties before the contractor undertakes performance, the contracting

officer shall require written (see 2.101) acceptance of the purchase

order by the contractor.

(b) Each purchase order modification shall identify the order it

modifies and shall contain an appropriate modification number.

modification may be required only if--

(1) Determined by the contracting officer to be necessary to ensure

the contractor's compliance with the purchase order as revised; or

(2) Required by agency regulations.

13.302-4 Termination or cancellation of purchase orders.

(a) If a purchase order that has been accepted in writing by the

contractor is to be terminated, the contracting officer shall process

the termination in accordance with--

(1) 12.403(d) and 52.212-4(l) for commercial items; or

(2) Part 49 or 52.213-4 for other than commercial items.

(b) If a purchase order that has not been accepted in writing by

the contractor is to be canceled, the contracting officer shall notify

the contractor in writing that the purchase order has been canceled,

request the contractor's written acceptance of the cancellation, and

proceed as follows:

(1) If the contractor accepts the cancellation and does not claim

that costs were incurred as a result of beginning performance under the

purchase order, no further action is required (i.e., the purchase order

shall be considered canceled).

(2) If the contractor does not accept the cancellation or claims

that costs were incurred as a result of beginning performance under the

purchase order, the contracting officer shall process the termination

action as prescribed in paragraph (a) of this subsection.

13.302-5 Clauses.

(a) Each purchase order (and each purchase order modification (see

13.302-3)) shall incorporate all clauses prescribed for the particular

acquisition.

(b) The contracting officer shall insert the clause at 52.213-2,

Invoices, in purchase orders that authorize advance payments (see 31

U.S.C. 3324(d)(2)) for subscriptions or other charges for newspapers,

magazines, periodicals, or other publications (i.e., any publication

printed, microfilmed, photocopied, or

[[Page 64923]]

magnetically or otherwise recorded for auditory or visual usage).

Notice to Supplier, in unpriced purchase orders.

(d) The contracting officer may use the clause at 52.213-4, Terms

and Conditions--Simplified Acquisitions (Other Than Commercial Items),

in simplified acquisitions exceeding the micro-purchase threshold that

are for other than commercial items (see 12.301). The clause--

(1) Is a compilation of the most commonly used clauses that apply

to simplified acquisitions; and

(2) May be modified to fit the individual acquisition to add other

needed clauses, or those clauses may be added separately. Modifications

(i.e., additions, deletions, or substitutions) must not create a void

or internal contradiction in the clause. For example, do not add an

inspection and acceptance or termination for convenience requirement

unless the existing requirement is deleted. Also, do not delete a

paragraph without providing for an appropriate substitute.

13.303 Blanket purchase agreements (BPAs).

13.303-1 General.

(a) A blanket purchase agreement (BPA) is a simplified method of

filling anticipated repetitive needs for supplies or services by

establishing ``charge accounts'' with qualified sources of supply (see

subpart 16.7 for additional coverage of agreements).

(b) BPAs should be established for use by an organization

responsible for providing supplies for its own operations or for other

offices, installations, projects, or functions. Such organizations, for

example, may be organized supply points, separate independent or

detached field parties, or one-person posts or activities.

responsibility for keeping obligations and expenditures within

available funds.

13.303-2 Establishment of BPAs.

(a) The following are circumstances under which contracting

officers may establish BPAs:

(1) There is a wide variety of items in a broad class of supplies

or services that are generally purchased, but the exact items,

quantities, and delivery requirements are not known in advance and may

vary considerably.

(2) There is a need to provide commercial sources of supply for one

or more offices or projects in a given area that do not have or need

authority to purchase otherwise.

(3) The use of this procedure would avoid the writing of numerous

purchase orders.

(4) There is no existing requirements contract for the same supply

or service that the contracting activity is required to use.

(b) After determining a BPA would be advantageous, contracting

officers shall--

(1) Establish the parameters to limit purchases to individual items

or commodity groups or classes, or permit the supplier to furnish

unlimited supplies or services; and

(2) Consider suppliers whose past performance has shown them to be

dependable, who offer quality supplies or services at consistently

lower prices, and who have provided numerous purchases at or below the

simplified acquisition threshold.

(1) More than one supplier for supplies or services of the same

type to provide maximum practicable competition;

(2) A single firm from which numerous individual purchases at or

below the simplified acquisition threshold will likely be made in a

given period; or

(3) Federal Supply Schedule contractors, if not inconsistent with

the terms of the applicable schedule contract.

(d) BPAs should be prepared without a purchase requisition and only

after contacting suppliers to make the necessary arrangements for--

(1) Securing maximum discounts;

(2) Documenting individual purchase transactions;

(3) Periodic billings; and

(4) Incorporating other necessary details.

13.303-3 Preparation of BPAs.

Prepare BPAs on the forms specified in 13.307. Do not cite

accounting and appropriation data (see 13.303-5(e)(4)).

(a) The following terms and conditions are mandatory:

(1) Description of agreement. A statement that the supplier shall

furnish supplies or services, described in general terms, if and when

requested by the contracting officer (or the authorized representative

of the contracting officer) during a specified period and within a

stipulated aggregate amount, if any.

(2) Extent of obligation. A statement that the Government is

obligated only to the extent of authorized purchases actually made

under the BPA.

(3) Purchase limitation. A statement that specifies the dollar

limitation for each individual purchase under the BPA (see 13.303-

5(b)).

(4) Individuals authorized to purchase under the BPA. A statement

that a list of individuals authorized to purchase under the BPA,

identified either by title of position or by name of individual,

organizational component, and the dollar limitation per purchase for

each position title or individual shall be furnished to the supplier by

the contracting officer.

(5) Delivery tickets. A requirement that all shipments under the

agreement, except those for newspapers, magazines, or other

periodicals, shall be accompanied by delivery tickets or sales slips

that shall contain the following minimum information:

(i) Name of supplier.

(ii) BPA number.

(iii) Date of purchase.

(iv) Purchase number.

(v) Itemized list of supplies or services furnished.

(vi) Quantity, unit price, and extension of each item, less

applicable discounts (unit prices and extensions need not be shown when

incompatible with the use of automated systems, provided that the

invoice is itemized to show this information).

(vii) Date of delivery or shipment.

(6) Invoices. One of the following statements shall be included

(except that the statement in paragraph (a)(6)(iii) of this subsection

should not be used if the accumulation of the individual invoices by

the Government materially increases the administrative costs of this

purchase method):

(i) A summary invoice shall be submitted at least monthly or upon

expiration of this BPA, whichever occurs first, for all deliveries made

during a billing period, identifying the delivery tickets covered

therein, stating their total dollar value, and supported by receipt

copies of the delivery tickets.

(ii) An itemized invoice shall be submitted at least monthly or

upon expiration of this BPA, whichever occurs first, for all deliveries

made during a billing period and for which payment has not been

received. These invoices need not be supported by copies of delivery

tickets.

(iii) When billing procedures provide for an individual invoice for

each delivery, these invoices shall be accumulated, provided that--

(A) A consolidated payment will be made for each specified period;

and

(B) The period of any discounts will commence on the final date of

the billing period or on the date of receipt of invoices for all

deliveries accepted during the billing period, whichever is later.

(iv) An invoice for subscriptions or other charges for newspapers,

[[Page 64924]]

magazines, or other periodicals shall show the starting and ending

dates and shall state either that ordered subscriptions have been

placed in effect or will be placed in effect upon receipt of payment.

(b) If the fast payment procedure is used, include the requirements

stated in 13.403.

13.303-4 Clauses.

(a) The contracting officer shall insert in each BPA the clauses

prescribed elsewhere in this part that are required for or applicable

to the particular BPA.

(b) Unless a clause prescription specifies otherwise (e.g., see

22.305(a), 22.605(a)(5), or 22.1006), if the prescription includes a

dollar threshold, the amount to be compared to that threshold is that

of any particular order under the BPA.

13.303-5 Purchases under BPAs.

(a) Use a BPA only for purchases that are otherwise authorized by

law or regulation.

(b) Individual purchases shall not exceed the simplified

acquisition threshold. However, agency regulations may establish a

higher threshold consistent with the following:

(1) The simplified acquisition threshold and the $5,000,000

limitation for individual purchases do not apply to BPAs established in

accordance with 13.303-2(c)(3).

(2) The limitation for individual purchases for commercial item

acquisitions conducted under subpart 13.5 is $5,000,000.

one source or avoiding small business set-asides. The requirements of

13.003(b) and subpart 19.5 also apply to each order.

(d) If, for a particular purchase greater than the micro-purchase

threshold, there is an insufficient number of BPAs to ensure maximum

practicable competition, the contracting officer shall--

(1) Solicit quotations from other sources (see 13.105) and make the

purchase as appropriate; and

(2) Establish additional BPAs to facilitate future purchases if--

(i) Recurring requirements for the same or similar supplies or

services seem likely;

(ii) Qualified sources are willing to accept BPAs; and

(iii) It is otherwise practical to do so.

(e) Limit documentation of purchases to essential information and

forms as follows:

(1) Purchases generally should be made electronically, or orally

when it is not considered economical or practical to use electronic

methods.

(2) A paper purchase document may be issued if necessary to ensure

that the supplier and the purchaser agree concerning the transaction.

(3) Unless a paper document is issued, record essential elements

(e.g., date, supplier, supplies or services, price, delivery date) on

the purchase requisition, in an informal memorandum, or on a form

developed locally for the purpose.

(4) Cite the pertinent purchase requisitions and the accounting and

appropriation data.

(5) When delivery is made or the services are performed, the

supplier's sales document, delivery document, or invoice may (if it

reflects the essential elements) be used for the purpose of recording

receipt and acceptance of the supplies or services. However, if the

purchase is assigned to another activity for administration, the

authorized Government representative shall document receipt and

acceptance of supplies or services by signing and dating the agency

specified form after verification and after notation of any exceptions.

13.303-6 Review procedures.

(a) The contracting officer placing orders under a BPA, or the

designated representative of the contracting officer, shall review a

sufficient random sample of the BPA files at least annually to ensure

that authorized procedures are being followed.

(b) The contracting officer that entered into the BPA shall--

(1) Ensure that each BPA is reviewed at least annually and, if

necessary, updated at that time; and

(2) Maintain awareness of changes in market conditions, sources of

supply, and other pertinent factors that may warrant making new

arrangements with different suppliers or modifying existing

arrangements.

a BPA is authorized to make purchases under that BPA, the agency that

has jurisdiction over the office authorized to make the purchases shall

ensure that the procedures in paragraph (a) of this subsection are

being followed.

13.303-7 Completion of BPAs.

An individual BPA is considered complete when the purchases under

it equal its total dollar limitation, if any, or when its stated time

period expires.

13.303-8 Optional clause.

The clause at 52.213-4, Terms and Conditions--Simplified

Acquisitions (Other Than Commercial Items), may be used in BPAs

established under this section.

13.304 [Reserved]

13.305 Imprest funds and third party drafts.

13.305-1 General.

Imprest funds and third party drafts may be used to acquire and to

pay for supplies or services. Policies and regulations concerning the

establishment of and accounting for imprest funds and third party

drafts, including the responsibilities of designated cashiers and

alternates, are contained in Part IV of the Treasury Financial Manual

for Guidance of Departments and Agencies, Title 7 of the General

Accounting Office Policy and Procedures Manual for Guidance of Federal

Agencies, and the agency implementing regulations. Agencies also shall

be guided by the Manual of Procedures and Instructions for Cashiers,

issued by the Financial Management Service, Department of the Treasury.

13.305-2 Agency responsibilities.

Each agency using imprest funds and third party drafts shall--

(a) Periodically review and determine whether there is a continuing

need for each fund or third party draft account established, and that

amounts of those funds or accounts are not in excess of actual needs;

(b) Take prompt action to have imprest funds or third party draft

accounts adjusted to a level commensurate with demonstrated needs

whenever circumstances warrant such action; and

regulations shall include (but are not limited to) procedures

covering--

(1) Designation of personnel authorized to make purchases using

imprest funds or third party drafts; and

(2) Documentation of purchases using imprest funds or third party

drafts, including documentation of--

(i) Receipt and acceptance of supplies and services by the

Government;

(ii) Receipt of cash or third party draft payments by the

suppliers; and

(iii) Cash advances and reimbursements.

13.305-3 Conditions for use.

Imprest funds or third party drafts may be used for purchases

when--

(a) The imprest fund transaction does not exceed $500 or such other

limits as have been approved by the agency head;

(b) The third party draft transaction does not exceed $2,500,

unless authorized at a higher level in accordance with Treasury

restrictions;

[[Page 64925]]

be advantageous to the Government; and

(d) The use of imprest funds or third party drafts for the

transaction otherwise complies with any additional conditions

established by agencies and with the policies and regulations

referenced in 13.305-1.

13.305-4 Procedures.

(a) Each purchase using imprest funds or third party drafts shall

be based upon an authorized purchase requisition, contracting officer

verification statement, or other agency approved method of ensuring

that adequate funds are available for the purchase.

(b) Normally, purchases should be placed orally and without

soliciting competition if prices are considered reasonable.

placement of the order and delivery of the items, clauses are not

required for purchases using imprest funds or third party drafts.

(d) Forms prescribed at 13.307(e) may be used if a written order is

considered necessary (e.g., if required by the supplier for discount,

tax exemption, or other reasons). If a purchase order is used, endorse

it ``Payment to be made from Imprest Fund'' (or ``Payment to be made

from Third Party Draft,'' as appropriate).

(e) The individual authorized to make purchases using imprest funds

or third party drafts shall--

(1) Furnish to the imprest fund or third party draft cashier a copy

of the document required under paragraph (a) of this subsection

annotated to reflect--

(i) That an imprest fund or third party draft purchase has been

made;

(ii) The unit prices and extensions; and

(iii) The supplier's name and address; and

(2) Require the supplier to include with delivery of the supplies

an invoice, packing slip, or other sales instrument giving--

(i) The supplier's name and address;

(ii) List and quantity of items supplied;

(iii) Unit prices and extensions; and

(iv) Cash discount, if any.

13.306 SF 44, Purchase Order--Invoice--Voucher.

The SF 44, Purchase Order--Invoice--Voucher, is a multipurpose

pocket-size purchase order form designed primarily for on-the-spot,

over-the-counter purchases of supplies and nonpersonal services while

away from the purchasing office or at isolated activities. It also can

be used as a receiving report, invoice, and public voucher.

(a) This form may be used if all of the following conditions are

satisfied:

(1) The amount of the purchase is at or below the micro-purchase

threshold, except for purchases made under unusual and compelling

urgency or in support of contingency operations. Agencies may establish

higher dollar limitations for specific activities or items;

(2) The supplies or services are immediately available;

(3) One delivery and one payment will be made; and

(4) Its use is determined to be more economical and efficient than

use of other simplified acquisition procedures.

(b) General procedural instructions governing the form's use are

printed on the form and on the inside front cover of each book of

forms.

placement of the order and delivery of the items, clauses are not

required for purchases using this form.

(d) Agencies shall provide adequate safeguards regarding the

control of forms and accounting for purchases.

13.307 Forms.

(a) Commercial items. For use of the SF 1449, Solicitation/

Contract/Order for Commercial Items, see 12.204.

(b) Other than commercial items.

(1) Except when quotations are solicited via FACNET, other

electronic means, or orally, the SF 1449; SF 18, Request for

Quotations; or an agency form/automated format may be used. Each agency

request for quotations form/automated format should conform with the SF

18 or SF 1449 to the maximum extent practicable.

(2) Both SF 1449 and OF 347, Order for Supplies or Services, are

multipurpose forms used for negotiated purchases of supplies or

services, delivery or task orders, inspection and receiving reports,

and invoices. An agency form/automated format also may be used.

(1) OF 336, Continuation Sheet, or an agency form/automated format

may be used when additional space is needed.

(2) OF 348, Order for Supplies or Services Schedule--Continuation,

or an agency form/automated format may be used for negotiated purchases

when additional space is needed. Agencies may print on these forms the

clauses considered to be generally suitable for purchases.

(3) SF 30, Amendment of Solicitation/Modification of Contract, or a

purchase order form may be used to modify a purchase order, unless an

agency form/automated format is prescribed in agency regulations.

(d) SF 44, Purchase Order--Invoice--Voucher, is a multipurpose

pocket-size purchase order form that may be used as outlined in 13.306.

(e) SF 1165, Receipt for Cash--Subvoucher, or an agency purchase

order form may be used for purchases using imprest funds or third party

drafts.

Subpart 13.4--Fast Payment Procedure

13.401 General.

(a) The fast payment procedure allows payment under limited

conditions to a contractor prior to the Government's verification that

supplies have been received and accepted. The procedure provides for

payment for supplies based on the contractor's submission of an invoice

that constitutes a certification that the contractor--

(1) Has delivered the supplies to a post office, common carrier, or

point of first receipt by the Government; and

(2) Shall replace, repair, or correct supplies not received at

destination, damaged in transit, or not conforming to purchase

agreements.

(b) The contracting officer shall be primarily responsible for

collecting debts resulting from failure of contractors to properly

replace, repair, or correct supplies lost, damaged, or not conforming

to purchase requirements (see 32.605(b) and 32.606).

13.402 Conditions for use.

If the conditions in paragraphs (a) through (f) of this section are

present, the fast payment procedure may be used, provided that use of

the procedure is consistent with the other conditions of the purchase.

The conditions for use of the fast payment procedure are as follows:

(a) Individual purchasing instruments do not exceed $25,000, except

that executive agencies may permit higher dollar limitations for

specified activities or items on a case-by-case basis.

(b) Deliveries of supplies are to occur at locations where there is

both a geographical separation and a lack of adequate communications

facilities between Government receiving and disbursing activities that

will make it impractical to make timely payment based on evidence of

Government acceptance.

(1) Upon delivery to a post office or common carrier for mailing or

shipment to destination; or

[[Page 64926]]

(2) Upon receipt by the Government if the shipment is by means

other than Postal Service or common carrier.

(d) The supplier agrees to replace, repair, or correct supplies not

received at destination, damaged in transit, or not conforming to

purchase requirements.

(e) The purchasing instrument is a firm-fixed-price contract, a

purchase order, or a delivery order for supplies.

(f) A system is in place to ensure--

(1) Documentation of evidence of contractor performance under fast

payment purchases;

(2) Timely feedback to the contracting officer in case of

contractor deficiencies; and

(3) Identification of suppliers that have a current history of

abusing the fast payment procedure (also see subpart 9.1).

13.403 Preparation and execution of orders.

Priced or unpriced contracts, purchase orders, or BPAs using the

fast payment procedure shall include the following:

(a) A requirement that the supplies be shipped transportation or

postage prepaid.

(b) A requirement that invoices be submitted directly to the

finance or other office designated in the order, or in the case of

unpriced purchase orders, to the contracting officer (see 13.302-2(c)).

Consignee's Notification to Purchasing Activity of Nonreceipt, Damage,

or Nonconformance

The consignee shall notify the purchasing office promptly after the

specified date of delivery of supplies not received, damaged in

transit, or not conforming to specifications of the purchase order.

Unless extenuating circumstances exist, the notification should be made

not later than 60 days after the specified date of delivery.

13.404 Contract clause.

The contracting officer shall insert the clause at 52.213-1, Fast

Payment Procedure, in solicitations and contracts when the conditions

in 13.402 are applicable and it is intended that the fast payment

procedure be used in the contract (in the case of BPAs, the contracting

officer may elect to insert the clause either in the BPA or in orders

under the BPA).

Subpart 13.5--Test Program for Certain Commercial Items

13.500 General.

(a) This subpart authorizes, as a test program, use of simplified

procedures for the acquisition of supplies and services in amounts

greater than the simplified acquisition threshold but not exceeding

$5,000,000, including options, if the contracting officer reasonably

expects, based on the nature of the supplies or services sought, and on

market research, that offers will include only commercial items.

Under this test program, contracting officers may use any simplified

acquisition procedure in this part, subject to any specific dollar

limitation applicable to the particular procedure. The purpose of this

test program is to vest contracting officers with additional procedural

discretion and flexibility, so that commercial item acquisitions in

this dollar range may be solicited, offered, evaluated, and awarded in

a simplified manner that maximizes efficiency and economy and minimizes

burden and administrative costs for both the Government and industry

(10 U.S.C. 2304(g) and 2305 and 41 U.S.C. 253(g) and 253a and 253b).

(b) For the period of this test, contracting activities shall

employ the simplified procedures authorized by the test to the maximum

extent practicable.

part, the requirements of part 12 apply subject to the order of

precedence provided at 12.102(c). This includes use of the provisions

and clauses in subpart 12.3.

(d) The authority to issue solicitations under this subpart shall

expire on January 1, 2000. Contracts may be awarded after the

expiration of this authority for solicitations issued before the

expiration of the authority.

13.501 Special documentation requirements.

(a) Sole source acquisitions. (1) Acquisitions conducted under

simplified acquisition procedures are exempt from the requirements in

part 6. However, contracting officers shall--

(i) Conduct sole source acquisitions, as defined in 6.003, under

this subpart only if the need to do so is justified in writing and

approved at the levels specified in paragraphs (a)(2)(i) and (a)(2)(ii)

of this section; and

(ii) Prepare sole source justifications using the format at 6.303-

2, modified to reflect an acquisition under the authority of the test

program for commercial items (section 4202 of the Clinger-Cohen Act of

1996).

(2) Justifications and approvals are required under this subpart

only for sole source acquisitions.

(i) For a proposed contract exceeding $100,000, but not exceeding

$500,000, the contracting officer's certification that the

justification is accurate and complete to the best of the contracting

officer's knowledge and belief will serve as approval, unless a higher

approval level is established in accordance with agency procedures.

(ii) For a proposed contract exceeding $500,000, the approval shall

be by the competition advocate for the procuring activity, designated

pursuant to 6.501; or an official described in 6.304(a)(3) or (a)(4).

This authority is not delegable.

(b) Contract file documentation. The contract file shall include--

(1) A brief written description of the procedures used in awarding

the contract, including the fact that the test procedures in FAR

subpart 13.5 were used;

(2) The number of offers received;

(3) An explanation, tailored to the size and complexity of the

acquisition, of the basis for the contract award decision; and

(4) Any justification approved under paragraph (a) of this section.

PART 16--TYPES OF CONTRACTS

16.701 [Amended]

9. Section 16.701 is amended in the parenthetical by revising

``subpart 13.2'' to read ``13.303''.

16.703 [Amended]

10. Section 16.703 is amended in paragraph (c)(1)(vi) by revising

the citation ``13.303'' to read ``13.403''.

PART 19--SMALL BUSINESS PROGRAMS

19.1006 [Amended]

11. Section 19.1006 is amended in paragraph (c)(1)(i) by removing

``13.105 or''.

PART 32--CONTRACT FINANCING

32.1103 [Amended]

12. Section 32.1103 is amended in paragraph (a)(1) by revising the

reference ``13.103(e)'' to read ``13.003(f)'' and in paragraph (b)(2)

by revising ``13.103(e)'' to read ``13.301''.

PART 41--ACQUISITION OF UTILITY SERVICES

41.202 [Amended]

13. Section 41.202 is amended in paragraph (c)(1) by revising the

reference ``subpart 13.5'' to read ``13.302''.

PART 43--CONTRACT MODIFICATIONS

43.301 [Amended]

14. Section 43.301 is amended in paragraph (a)(2)(iii) by revising

the reference ``13.503'' to read ``13.302-3''.

[[Page 64927]]

PART 49--TERMINATION OF CONTRACTS

49.002 [Amended]

15. Section 49.002 is amended in paragraph (a) by revising the

reference ``13.504(b)'' to read ``13.302-4''.

16. Section 49.501 is amended by adding the following text as the

second sentence:

49.501 General.

* * * This subpart does not apply to contracts that use the clause

at 52.213-4, Terms and Conditions--Simplified Acquisitions (Other Than

Commercial Items). * * *

* * * * *

PART 52--SOLICITATION PROVISIONS AND CONTRACT CLAUSES

52.101 [Amended]

17. Section 52.101 is amended in paragraph (e)(2)(i) by removing

the semicolon after the word ``authorized'' and replacing it with

``(see 52.102);''.

18. Section 52.102 is revised to read as follows:

52.102 Incorporating provisions and clauses.

(a) Provisions and clauses should be incorporated by reference to

the maximum practical extent, rather than being incorporated in full

text, even if they--

(1) Are used with one or more alternates or on an optional basis;

(2) Are prescribed on a ``substantially as follows'' or

``substantially the same as'' basis, provided they are used verbatim;

(3) Require modification or the insertion by the Government of

fill-in material (see 52.104); or

(4) Require completion by the offeror or prospective contractor.

This instruction also applies to provisions completed as annual

representations and certifications.

(b) Except for provisions and clauses prescribed in 52.107, any

provision or clause that can be accessed electronically by the offeror

or prospective contractor may be incorporated by reference in

solicitations and/or contracts. However, the contracting officer, upon

request, shall provide the full text of any provision or clause

incorporated by reference.

acquisition regulations, and provisions and clauses not authorized by

subpart 52.3 to be incorporated by reference, need not be incorporated

in full text, provided the contracting officer includes in the

solicitation and contract a statement that--

(1) Identifies all provisions and clauses that require completion

by the offeror or prospective contractor;

(2) Specifies that the provisions and clauses must be completed by

the offeror or prospective contractor and must be submitted with the

quotation or offer; and

(3) Identifies to the offeror or prospective contractor at least

one electronic address where the full text may be accessed.

(d) An agency may develop a group listing of provisions and clauses

that apply to a specific category of contracts. An agency group listing

may be incorporated by reference in solicitations and/or contracts in

lieu of citing the provisions and clauses individually, provided the

group listing is made available electronically to offerors and

prospective contractors.

(e) A provision or clause that is not available electronically to

offerors and prospective contractors shall be incorporated in

solicitations and/or contracts in full text if it is--

(1) A FAR provision or clause that otherwise is not authorized to

be incorporated by reference (see subpart 52.3); or

(2) A provision or clause prescribed for use in an agency

acquisition regulation.

(f) Provisions or clauses may not be incorporated by reference by

being listed in the--

(1) Provision at 52.252-3, Alterations in Solicitations; or

(2) Clause at 52.252-4, Alterations in Contract.

52.102-1 and 52.102-2 [Removed]

19. Sections 52.102-1 and 52.102-2 are removed.

20. Section 52.213-1 is revised to read as follows:

52.213-1 Fast Payment Procedure.

As prescribed in 13.404, insert the following clause:

Fast Payment Procedure (Feb 1998)

(a) General. The Government will pay invoices based on the

Contractor's delivery to a post office or common carrier (or, if

shipped by other means, to the point of first receipt by the

Government).

(b) Responsibility for supplies. (1) Title to the supplies

passes to the Government upon delivery to--

(i) A post office or common carrier for shipment to the specific

destination; or

(ii) The point of first receipt by the Government, if shipment

is by means other than Postal Service or common carrier.

(2) Notwithstanding any other provision of the contract, order,

or blanket purchase agreement, the Contractor shall--

(i) Assume all responsibility and risk of loss for supplies not

received at destination, damaged in transit, or not conforming to

purchase requirements; and

(ii) Replace, repair, or correct those supplies promptly at the

Contractor's expense, if instructed to do so by the Contracting

Officer within 180 days from the date title to the supplies vests in

the Government.

or common carrier (or, if shipped by other means, the point of first

receipt by the Government), the Contractor shall--

(i) Prepare an invoice as provided in this contract, order, or

blanket purchase agreement; and

(ii) Display prominently on the invoice ``FAST PAY.''

(2) If the purchase price excludes the cost of transportation,

the Contractor shall enter the prepaid shipping cost on the invoice

as a separate item. The Contractor shall not include the cost of

parcel post insurance. If transportation charges are stated

separately on the invoice, the Contractor shall retain related paid

freight bills or other transportation billings paid separately for a

period of 3 years and shall furnish the bills to the Government upon

request.

(3) If this contract, order, or blanket purchase agreement

requires the preparation of a receiving report, the Contractor shall

prepare the receiving report on the prescribed form or,

alternatively, shall include the following information on the

invoice, in addition to that required in paragraph (c)(1) of this

clause:

(i) A statement in prominent letters ``NO RECEIVING REPORT

PREPARED.''

(ii) Shipment number.

(iii) Mode of shipment.

(iv) At line item level--

(A) National stock number and/or manufacturer's part number;

(B) Unit of measure;

(D) Mark-For Point, if in the contract; and

(E) FEDSTRIP/MILSTRIP document number, if in the contract.

(4) If this contract, order, or blanket purchase agreement does

not require preparation of a receiving report on a prescribed form,

the Contractor shall include on the invoice the following

information at the line item level, in addition to that required in

paragraph (c)(1) of this clause:

(i) Ship-To Point.

(ii) Mark-For Point.

(iii) FEDSTRIP/MILSTRIP document number, if in the contract.

(5) Where a receiving report is not required, the Contractor

shall include a copy of the invoice in each shipment.

(d) Certification of invoice. The Contractor certifies by

submitting an invoice to the Government that the supplies being

billed to the Government have been shipped or delivered in

accordance with shipping instructions issued by the ordering

officer, in the quantities shown on the invoice, and that the

supplies are in the quantity and of the quality designated by the

contract, order, or blanket purchase agreement.

[[Page 64928]]

(e) Fast pay container identification. The Contractor shall mark

all outer shipping containers ``FAST PAY.''

(End of clause)

52.213-2 [Amended]

21. Section 52.213-2 is amended in the introductory text by

revising the reference ``13.506(b)'' to read ``13.302-5(b)''.

52.213-3 [Amended]

22. Section 52.213-3 is amended in the introductory text by

revising the reference ``13.506(c)'' to read ``13.302-5(c)''.

23. Section 52.213-4 is added to read as follows:

52.213-4 Terms and Conditions--Simplified Acquisitions (Other Than

Commercial Items).

As prescribed in 13.302-5(d), insert the following clause:

Terms and Conditions--Simplified Acquisitions (Other Than Commercial

Items) (Feb 1998)

(a) The Contractor shall comply with the following Federal

Acquisition Regulation (FAR) clauses that are incorporated by

reference:

(1) The clauses listed below implement provisions of law or

Executive order:

(i) 52.222-3, Convict Labor (Aug 1996) (E.O. 11755).

(ii) 52.233-3, Protest After Award (Aug 1996) (31 U.S.C. 3553).

(2) Listed below are additional clauses that apply:

(i) 52.225-11, Restrictions on Certain Foreign Purchases (Oct

1996).

(ii) 52.232-1, Payments (Apr 1984).

(iii) 52.232-8, Discounts for Prompt Payment (May 1997).

(iv) 52.232-11, Extras (Apr 1984).

(v) 52.232-25, Prompt Payment (Jun 1997).

(vi) 52.232-33, Mandatory Information for Electronic Funds

Transfer Payment (Aug 1996).

(vii) 52.233-1, Disputes (Oct 1995).

(viii) 52.244-6, Subcontracts for Commercial Items and

Commercial Components (Oct 1995).

(ix) 52.253-1, Computer Generated Forms (Jan 1991).

(b) The Contractor shall comply with the following FAR clauses,

incorporated by reference, unless the circumstances do not apply:

(1) The clauses listed below implement provisions of law or

Executive order:

(i) 52.222-20, Walsh-Healey Public Contracts Act (DEC 1996) (41

U.S.C. 35-45) (Applies to supply contracts over $10,000 in the

United States).

(ii) 52.222-26, Equal Opportunity (APR 1984) (E.O. 11246)

(Applies to contracts over $10,000).

(iii) 52.222-35, Affirmative Action for Special Disabled and

Vietnam Era Veterans (APR 1984) (38 U.S.C. 4212) (Applies to

contracts over $10,000).

(iv) 52.222-36, Affirmative Action for Handicapped Workers (APR

1984) (29 U.S.C. 793) (Applies to contracts over $2,500).

(v) 52.222-37, Employment Reports on Special Disabled Veterans

and Veterans of the Vietnam Era (JAN 1988) (38 U.S.C. 4212) (Applies

to contracts over $10,000).

(vi) 52.222-41, Service Contract Act of 1965, As Amended (MAY

1989) (41 U.S.C. 351, et seq.) (Applies to service contracts over

$2,500).

(vii) 52.223-5, Pollution Prevention and Right-to-Know

Information (MAR 1997) (E.O. 12856) (Applies to services performed

on Federal facilities).

(viii) 52.225-3, Buy American Act--Supplies (JAN 1994) (41

U.S.C. 10) (Applies to supplies, and to services involving the

furnishing of supplies, if the contract was--

(A) Under $25,000; or

(B) Set aside for small business concerns, regardless of dollar

value).

(2) Listed below are additional clauses that may apply:

(i) 52.209-6, Protecting the Government's Interest When

Subcontracting with Contractors Debarred, Suspended, or Proposed for

Debarment (JULY 1995) (Applies to contracts over $25,000).

(ii) 52.211-17, Delivery of Excess Quantities (SEPT 1989)

(Applies to fixed-price supplies).

(iii) 52.247-29, F.o.b. Origin (JUN 1988) (Applies to supplies

if delivery is f.o.b. origin).

(iv) 52.247-34, F.o.b. Destination (NOV 1991) (Applies to

supplies if delivery is f.o.b. destination).

This contract incorporates one or more clauses by reference, with

the same force and effect as if they were given in full text. Upon

request, the Contracting Officer will make their full text

available. Also, the full text of a clause may be accessed

electronically at this/these address(es):

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

[Insert one or more Internet addresses]

(d) Inspection/Acceptance. The Contractor shall tender for

acceptance only those items that conform to the requirements of this

contract. The Government reserves the right to inspect or test any

supplies or services that have been tendered for acceptance. The

Government may require repair or replacement of nonconforming

supplies or reperformance of nonconforming services at no increase

in contract price. The Government must exercise its postacceptance

rights--

(1) Within a reasonable period of time after the defect was

discovered or should have been discovered; and

(2) Before any substantial change occurs in the condition of the

item, unless the change is due to the defect in the item.

(e) Excusable delays. The Contractor shall be liable for default

unless nonperformance is caused by an occurrence beyond the

reasonable control of the Contractor and without its fault or

negligence, such as acts of God or the public enemy, acts of the

Government in either its sovereign or contractual capacity, fires,

floods, epidemics, quarantine restrictions, strikes, unusually

severe weather, and delays of common carriers. The Contractor shall

notify the Contracting Officer in writing as soon as it is

reasonably possible after the commencement of any excusable delay,

setting forth the full particulars in connection therewith, shall

remedy such occurrence with all reasonable dispatch, and shall

promptly give written notice to the Contracting Officer of the

cessation of such occurrence.

(f) Termination for the Government's convenience. The Government

reserves the right to terminate this contract, or any part hereof,

for its sole convenience. In the event of such termination, the

Contractor shall immediately stop all work hereunder and shall

immediately cause any and all of its suppliers and subcontractors to

cease work. Subject to the terms of this contract, the Contractor

shall be paid a percentage of the contract price reflecting the

percentage of the work performed prior to the notice of termination,

plus reasonable charges that the Contractor can demonstrate to the

satisfaction of the Government, using its standard record keeping

system, have resulted from the termination. The Contractor shall not

be required to comply with the cost accounting standards or contract

cost principles for this purpose. This paragraph does not give the

Government any right to audit the Contractor's records. The

Contractor shall not be paid for any work performed or costs

incurred that reasonably could have been avoided.

(g) Termination for cause. The Government may terminate this

contract, or any part hereof, for cause in the event of any default

by the Contractor, or if the Contractor fails to comply with any

contract terms and conditions, or fails to provide the Government,

upon request, with adequate assurances of future performance. In the

event of termination for cause, the Government shall not be liable

to the Contractor for any amount for supplies or services not

accepted, and the Contractor shall be liable to the Government for

any and all rights and remedies provided by law. If it is determined

that the Government improperly terminated this contract for default,

such termination shall be deemed a termination for convenience.

(h) Warranty. The Contractor warrants and implies that the items

delivered hereunder are merchantable and fit for use for the

particular purpose described in this contract.

(End of clause)

24. Sections 52.252-1 and 52.252-2 are revised to read as follows:

52.252-1 Solicitation Provisions Incorporated by Reference.

As prescribed in 52.107(a), insert the following provision:

Solicitation Provisions Incorporated by Reference (Feb 1998)

This solicitation incorporates one or more solicitation

provisions by reference, with the same force and effect as if they

were given in full text. Upon request, the Contracting Officer will

make their full text available. The offeror is cautioned that the

listed provisions may include blocks that must be completed by the

offeror and submitted with its quotation or offer. In lieu of

submitting

[[Page 64929]]

the full text of those provisions, the offeror may identify the

provision by paragraph identifier and provide the appropriate

information with its quotation or offer. Also, the full text of a

solicitation provision may be accessed electronically at this/these

address(es):

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

[Insert one or more Internet addresses]

(End of provision)

52.252-2 Clauses Incorporated by Reference.

As prescribed in 52.107(b), insert the following clause:

Clauses Incorporated by Reference (Feb 1998)

This contract incorporates one or more clauses by reference,

with the same force and effect as if they were given in full text.

Upon request, the Contracting Officer will make their full text

available. Also, the full text of a clause may be accessed

electronically at this/these address(es):

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

[Insert one or more Internet addresses]

(End of clause)

PART 53--FORMS

53.213 and 53.243 [Amended]

25. Amend the internal references throughout 53.213 and 53.243 as

indicated in the following table:

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

Location Remove Insert

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

53.213(a)...................... 13.107 both times it appears........................... 13.307(b)

53.213(b)...................... 13.503(b).............................................. 13.307(c)(3)

3.213(c)....................... 13.505(b).............................................. 13.306

53.213(d)...................... 13.404(e).............................................. 13.307(e)

53.213(e)...................... 13.107(c).............................................. 13.307(c)(1)

53.213(f)(1)................... 13.505................................................. 13.307

53.213(f)(2)................... 13.202................................................. 13.303-2

53.213(f)(2)................... 13.204(e).............................................. 13.303-5

53.243 undesignated paragraph.. 13.503(b).............................................. 13.302-3

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

[FR Doc. 97-31817 Filed 12-8-97; 8:45 am]

BILLING CODE 6820-EP-P

This is a copy of a public record, reproduced as it was published. It is not legal advice, and it may not be the version a court would rely on. Check the official source before you cite it.