Federal Acquisition Regulation; Option Clause Consistency

SUMMARY: The Civilian Agency Acquisition Council and the Defense

Acquisition Regulations Council are proposing to amend the Federal

Acquisition Regulation (FAR) to make the format of the Option to Extend

Services clause consistent with the format of other FAR option clauses.

The change also permits the time period for providing a preliminary

notice of the Government's intent to exercise a contract option to be

tailored.

DATES: Comments should be submitted on or before March 23, 1999 to be

considered in the formulation of a final rule.

ADDRESSES: Interested parties should submit written comments to:

General Services Administration, FAR Secretariat (MVR), Attn: Laurie

Duarte 1800 F Street, NW, Room 4035, Washington, DC 20405.

E-mail comments submitted over Internet should be addressed to:

[email protected].

Please cite FAR case 98-606 in all correspondence related to this

case.

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

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

pertaining to status or publication schedules. For clarification of

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

501-1758. Please cite FAR case 98-606.

SUPPLEMENTARY INFORMATION:

A. Background

This proposed rule amends the clause at FAR 52.217-8, Option to

Extend Services, to permit the contracting officer to insert, in the

clause, a time period for exercise of the option consistent with other

option clauses at FAR 52.217-6, -7, and -9. This proposed rule also

amends the clause at FAR 52.217-9, Option to Extend the Term of the

Contract, to clarify that the time period for providing preliminary

notice of option exercise may be tailored. The current prescription for

the clause permits the use of a clause ``substantially the same as''

the clause at FAR 52.217-9. This proposed change emphasizes that 60

days is the standard number of days within which to provide notice, but

the contracting officer may specify a different number of days, when

appropriate. Finally, an editorial amendment is made at FAR 17.208(g).

B. Regulatory Flexibility Act

This proposed rule is not expected to have a significant economic

impact on a substantial number of small entities within the meaning of

the Regulatory Flexibility Act, 5 U.S.C. 601, et seq., because the rule

merely amends the FAR clause pertaining to option to extend services to

permit insertion of an option period within the clause, rather than in

the contract schedule. The rule also clarifies existing FAR guidance

pertaining to preliminary notice of the Government's intent to exercise

a contract option. An Initial Regulatory Flexibility Analysis has,

therefore, not been performed. Comments are invited from small

businesses and other interested parties. Comments from small entities

concerning the affected FAR subparts will be considered in accordance

with 5 U.S.C. 610 of the Act. Such comments must be submitted

separately and should cite 5 U.S.C. 601, et seq. (FAR Case 98-606), in

correspondence.

C. Paperwork Reduction Act

The Paperwork Reduction Act does not apply because the proposed

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. 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.

List of Subjects in 48 CFR Parts 17 and 52

Government procurement.

Dated: January 14, 1999.

Edward C. Loeb,

Director, Federal Acquisition Policy Division.

Therefore, it is proposed that 48 CFR Parts 17 and 52 be amended as

set forth below:

1. The authority citation for 48 CFR Parts 17 and 52 continues to

read as follows:

Authority: 40 U.S.C. 486(c); 10 U.S.C. chapter 137; and 42

U.S.C. 2473(c).

PART 17--SPECIAL CONTRACTING METHODS

2. Section 17.208 is amended by revising paragraph (g) to read as

follows:

17.208 Solicitation provisions and contract clauses.

* * * * *

(g) The contracting officer shall insert a clause substantially the

same as the clause at 52.217-9, Option to Extend the Term of the

Contract, in solicitations and contracts when the inclusion of an

option is appropriate (see 17.200 and 17.202) and it is necessary to

include in the contract any or all of the following:

(1) A requirement that the Government shall give the contractor a

preliminary written notice of its intent to extend the contract.

(2) A statement that an extension of the contract includes an

extension of the option.

(3) A specified limitation on the total duration of the contract.

PART 52--SOLICITATION PROVISIONS AND CONTRACT CLAUSES

2. Section 52.217-8 is amended by revising the clause date and the

clause to read as follows:

52.217-8 Option to Extend Services.

* * * * *

OPTION TO EXTEND SERVICES [DATE]

The Government may require continued performance of any services

within the limits and at the rates specified in the contract. These

rates may be adjusted only as a result of revisions to prevailing

labor rates provided by the Secretary of Labor. The option provision

may be exercised more than once, but the total extension of

performance hereunder shall not exceed 6 months. The Contracting

Officer may exercise the option by written notice to the Contractor

within [insert the period of time within which the Contracting

Officer may exercise the option].

(End of clause)

3. Section 52.217-9 is amended by revising the clause date and

paragraph (a) of the clause to read as follows:

52.217-9 Option to Extend the Term of the Contract.

* * * * *

OPTION TO EXTEND THE TERM OF THE CONTRACT [DATE]

(a) The Government may extend the term of this contract by

written notice to the Contractor within [insert the period of time

within which the Contracting Officer may

[[Page 3619]]

exercise the option], provided that the Government shall give the

Contractor a preliminary written notice of its intent to extend at

least ______ days [60 days unless a different number of days is

inserted] before the contract expires. The preliminary notice does

not commit the Government to an extension.

* * * * *

(End of clause)

[FR Doc. 99-1316 Filed 1-21-99; 8:45 am]

BILLING CODE 6820-EP-P