Federal Acquisition Regulation; Service Contracts

DEPARTMENT OF DEFENSE

GENERAL SERVICES ADMINISTRATION

NATIONAL AERONAUTICS AND SPACE ADMINISTRATION

48 CFR Parts 32 and 37

[FAC 97-09; FAR Case 97-302; Item VIII]

RIN 9000-AI09

Federal Acquisition Regulation; Service Contracts

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

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

[[Page 58601]]

ACTION: Final rule.

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

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 expand the authority of the

Department of Defense and the Coast Guard to enter into contracts that

cross fiscal years.

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.

EFFECTIVE DATE: December 29, 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. Jeremy F. Olson at (202) 501-0692. Please cite FAC

97-09, FAR case 97-302.

SUPPLEMENTARY INFORMATION:

A. Background

Section 801 of the National Defense Authorization Act for Fiscal

Year 1998 (Pub. L. 105-85) amends 10 U.S.C. 2410a to authorize the

Secretary of Defense, the Secretary of a military department, or the

Secretary of Transportation with regard to the Coast Guard when not

operating as a service in the Navy, to enter into a contract for

procurement of severable services for a period that begins in one

fiscal year and ends in the next fiscal year.

B. Regulatory Flexibility Act

The final rule does not constitute a significant FAR revision

within the meaning of FAR 1.501 and Public Law 98-577, and publication

for public comments is not required. However, comments from small

entities concerning the affected FAR subparts will be considered in

accordance with 5 U.S.C. 610. Such comments must be submitted

separately and should cite 5 U.S.C. 601, et seq. (FAC 97-09, FAR case

97-302), in correspondence.

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 32 and 37

Government procurement.

Dated: October 22, 1998.

Edward C. Loeb,

Director, Federal Acquisition Policy Division.

Therefore, 48 CFR Parts 32 and 37 are amended as set forth below:

1. The authority citation for 48 CFR Parts 32 and 37 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 32--CONTRACT FINANCING

2. Section 32.703-3 is revised to read as follows:

32.703-3 Contracts crossing fiscal years.

(a) A contract that is funded by annual appropriations may not

cross fiscal years, except in accordance with statutory authorization

(e.g., 41 U.S.C. 11a, 31 U.S.C. 1308, 42 U.S.C. 2459a, 42 U.S.C. 3515,

and paragraph (b) of this subsection), or when the contract calls for

an end product that cannot feasibly be subdivided for separate

performance in each fiscal year (e.g., contracts for expert or

consultant services).

(b) The head of an executive agency, except NASA, may enter into a

contract, exercise an option, or place an order under a contract for

severable services for a period that begins in one fiscal year and ends

in the next fiscal year if the period of the contract awarded, option

exercised, or order placed does not exceed one year (10 U.S.C. 2410a

and 41 U.S.C. 253l). Funds made available for a fiscal year may be

obligated for the total amount of an action entered into under this

authority.

PART 37--SERVICE CONTRACTING

3. Section 37.106 is amended by revising paragraph (b) to read as

follows:

37.106 Funding and term of service contracts.

* * * * *

(b) The head of an executive agency, except NASA, may enter into a

contract, exercise an option, or place an order under a contract for

severable services for a period that begins in one fiscal year and ends

in the next fiscal year if the period of the contract awarded, option

exercised, or order placed does not exceed one year (10 U.S.C. 2410a

and 41 U.S.C. 253l). Funds made available for a fiscal year may be

obligated for the total amount of an action entered into under this

authority.

* * * * *

[FR Doc. 98-28962 Filed 10-29-98; 8:45 am]

BILLING CODE 6820-EP-U