Federal Acquisition Regulation; Assignment of Claims

Part IV

Department of Defense

General Services Administration

National Aeronautics and Space Administration

_______________________________________________________________________

48 CFR Part 32

Federal Acquisition Regulation; Assignment of Claims; Proposed Rule

Proposed Rules

DEPARTMENT OF DEFENSE

GENERAL SERVICES ADMINISTRATION

NATIONAL AERONAUTICS AND SPACE ADMINISTRATION

48 CFR Part 32

[FAR Case 94-761]

RIN 9000-XXXX

Federal Acquisition Regulation; Assignment of Claims

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

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

ACTION: Proposed rule.

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

SUMMARY: This proposed rule is issued pursuant to the Federal

Acquisition Streamlining Act of 1994 to implement revisions which

expand the authority to prohibit setoffs against assignees when

contractors assign a contract to a financial institution. This

regulatory action is not subject to Office of Management and Budget

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

DATES: Comments should be submitted on or before March 20, 1995 to be

considered in the formulation of a final rule.

ADDRESSES: Interested parties should submit written comments to: -

General Services Administration, FAR Secretariat (VRS),-18th & F

Streets, NW., Room 4037, Washington, DC 20405.

Please cite FAR case 94-761 in all correspondence related to this

case.

FOR FURTHER INFORMATION CONTACT: Mr. John Galbraith, Finance/Payment

Team Leader, at (703) 697-6710, in reference to this FAR case. For

general information, contact the FAR Secretariat, Room 4037, GSA

Building, Washington, DC 20405 (202) 501-4755. Please cite FAR case 94-

761.

SUPPLEMENTARY INFORMATION:

A. Background

.

Please cite FAR case 94-761 in all correspondence related to this

case.

FOR FURTHER INFORMATION CONTACT: Mr. John Galbraith, Finance/Payment

Team Leader, at (703) 697-6710, in reference to this FAR case. For

general information, contact the FAR Secretariat, Room 4037, GSA

Building, Washington, DC 20405 (202) 501-4755. Please cite FAR case 94-

761.

SUPPLEMENTARY INFORMATION:

A. Background

The Federal Acquisition Streamlining Act of 1994, Public Law 103-

355, (the Act) provides authorities that streamline the acquisition

process and minimize burdensome government-unique requirements. Major

changes that can be expected in the acquisition process as a result of

the Act's implementation include changes in the areas of Commercial

Item Acquisition, Simplified Acquisition Procedures, the Truth in

Negotiations Act, and introduction of the Federal Acquisition Computer

Network (FACNET). In order to promptly achieve the benefits of the

provisions of the Act, the government is issuing implementing

regulations on an expedited basis. We believe prompt publication of

proposed rules provides the public the opportunity to participate more

fully in the process of developing regulations.

The FAR Council is interested in an exchange of ideas and opinions

with respect to the regulatory implementation of the Act. For that

reason, the FAR Council is conducting a series of public meetings.

However, the FAR Council has not scheduled a public meeting on this

rule (FAR case 94-761) because of the clarity and non-controversial

nature of the rule. If the public believes such a meeting is needed

with respect to this rule, a letter requesting a public meeting and

outlining the nature of the requested meeting shall be submitted to and

received by the FAR Secretariat, Room 4037, GSA Building, Washington,

DC 20405 (202) 501-4755, on or before February 21, 1995. Please cite

FAR case 94-761. The FAR Council will consider such requests in

determining whether a public meeting on this rule should be scheduled.

is rule, a letter requesting a public meeting and

outlining the nature of the requested meeting shall be submitted to and

received by the FAR Secretariat, Room 4037, GSA Building, Washington,

DC 20405 (202) 501-4755, on or before February 21, 1995. Please cite

FAR case 94-761. The FAR Council will consider such requests in

determining whether a public meeting on this rule should be scheduled.

FAR Case 94-761

This notice announces FAR revisions developed under FAR case 94-

761. The language in FAR 32.803(d) is changed to expand the

authorization of a no-setoff commitment in contracts which are assigned

under the Act. Prior to the Act, the no-setoff commitment could only be

included in a contract during time of war or national emergency. Under

the Act, the inclusion of the no-setoff commitment is based solely on

whether the President makes a determination of need. The Act further

states that each determination of need by the President shall be

published in the Federal Register.

The Act also resulted in a reorganization of the United States Code

(U.S.C.) to improve the reading format. Some parts of the U.S.C. were

deleted as a result of obsolescence, such as the inclusion of the

Atomic Energy Commission as a designated agency which may utilize the

no-setoff commitment in contracts. Further, the U.S.C. reference to

contracts awarded prior to October 9, 1940, was deleted. These changes

to 41 U.S.C. 15 did not affect the current FAR language at Subpart

32.8.

The FAR has also been revised to reflect the micro-purchase

threshold, in lieu of the previous floor of $1,000, for use of the

Assignment of Claims clause.

B. Regulatory Flexibility Act

etoff commitment in contracts. Further, the U.S.C. reference to

contracts awarded prior to October 9, 1940, was deleted. These changes

to 41 U.S.C. 15 did not affect the current FAR language at Subpart

32.8.

The FAR has also been revised to reflect the micro-purchase

threshold, in lieu of the previous floor of $1,000, for use of the

Assignment of Claims clause.

B. Regulatory Flexibility Act

This proposed 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. Therefore, the Regulatory

Flexibility Act does not apply. However, comments from small entities

concerning the affected subpart will be considered in accordance with 5

U.S.C. 610. Such comments must be submitted separately and cite 5

U.S.C. 601, et seq. (FAR case 94-761), 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 Part 32

Government procurement.

Dated: January 12, 1995.

Edward Loeb,

Deputy Project Manager for the Implementation of the Federal

Acquisition Streamlining Act of 1994.

Therefore, it is proposed that 48 CFR Part 32 be amended as set

forth below:

1. The authority citation for 48 CFR Part 32 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

32.801 [Amended]

2. Section 32.801 is amended in the definition of ``Designated

agency'' by inserting ``the Department of Energy,'' following ``Federal

Aviation Administration,''.

3. Section 32.803(d) is revised to read as follows:

32.803 Policies.

* * * * *

inues 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

32.801 [Amended]

2. Section 32.801 is amended in the definition of ``Designated

agency'' by inserting ``the Department of Energy,'' following ``Federal

Aviation Administration,''.

3. Section 32.803(d) is revised to read as follows:

32.803 Policies.

* * * * *

(d) Any contract of a designated agency (see 32.801), except a

contract under which full payment has been made, may include a no-

setoff commitment only when a determination of need is made by the

President. Each such determination of need will be published in the

Federal Register.

* * * * *

4. Section 32.806(a) is revised to read as follows:

32.806 Contract clauses.

(a)(1) The contracting officer shall insert the clause at 52.232-

23,

Assignment of Claims, in solicitations and contracts expected to be

above the micro-purchase threshold, unless the contract will prohibit

the assignment of claims (see 32.803(b)). The use of the clause is not

required for purchase orders. However, the clause may be used in

purchase orders expected to be above the micro-purchase threshold, that

are accepted in writing by the contractor, if such use is consistent

with agency policies and regulations.

(2) If a no-setoff commitment is to be included in the contract

(see 32.801 and 32.803(d)), the contracting officer shall use the

clause with its Alternate I.

* * * * *

[FR Doc. 95-1259 Filed 1-18-95; 8:45 am]

BILLING CODE 6820-34-P