Defense Federal Acquisition Regulation Supplement; Utilization of Indian Organizations and Indian-Owned Economic Enterprises

DEPARTMENT OF DEFENSE

48 CFR Part 226

[DFARS Case 99-D300]

Defense Federal Acquisition Regulation Supplement; Utilization of

Indian Organizations and Indian-Owned Economic Enterprises

AGENCY: Department of Defense (DoD).

ACTION: Proposed rule with request for comments.

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SUMMARY: The Director of Defense Procurement is proposing to amend the

Defense Federal Acquisition Regulation Supplement (DFARS) to revise

procedures pertaining to the Indian Incentive Program. The Program

provides for incentive payments to Government contractors that use

Indian organizations and Indian-owned economic enterprises as

subcontractors. This proposed rule reflects new statutory provisions

that permit small business concerns to participate in the Indian

Incentive Program.

DATES: Comments on the proposed rule should be submitted in writing to

the address specified below on or before January 18, 2000, to be

considered in the formation of the final rule.

ADDRESSES: Interested parties should submit written comments on the

proposed rule to: Defense Acquisition Regulations Council, Attn: Ms.

Susan Schneider, PDUSD (AT&L) DP (DAR), IMD 3D139, 3062 Defense

Pentagon, Washington, DC 20301-3062. Telefax (703) 602-0350. Please

cite DFARS Case 99-D300.

E-mail comments submitted via the Internet should be addressed to:

dfarsacq.osd.mil

Please cite DFARS Case 99-D300 in all correspondence related to

this proposed rule. E-mail correspondence should cite DFARS Case 99-

D300 in the subject line.

FOR FURTHER INFORMATION CONTACT: Ms. Susan Schneider, (703) 602-0326.

Please cite DFARS Case 99-D300.

SUPPLEMENTARY INFORMATION:

A. Background

This proposed rule amends DFARS Subpart 226.1 to update procedures

pertaining to the Indian Incentive Program. Section 504 of the Indian

Financing Act of 1974 (25 U.S.C. 1544) established the Indian Incentive

Program, which provides for payment of incentives to Government

contractors that use Indian organizations and Indian-owned economic

enterprises as subcontractors. Prior to fiscal year 1999, annual

appropriations acts restricted DoD payments under the Program to those

contractors that submitted small business subcontracting plans pursuant

to 15 U.S.C. 637(d) or section 854 of Public Law 101-89 (15 U.S.C. 637

note). Since small business concerns are not required to submit

subcontracting plans, small businesses were excluded from participation

in the Indian Incentive Program under DoD contracts. Section 8024 of

the DoD Appropriations Act for Fiscal Year 1999 (Public Law 105-262)

and section 8024 of the DoD Appropriations Act for Fiscal Year 2000

(Public Law 106-79) eliminated the requirement for a DoD contractor to

submit a subcontracting plan before it may participate in the Indian

Incentive Program.

DoD implements the Indian Incentive Program through use of the

clause at Federal Acquisition Regulation (FAR) 52.226-1, Utilization of

Indian Organizations and Indian-Owned Economic Enterprises. The FAR and

DFARS presently prescribe use of the clause in only those DoD contracts

that contain subcontracting plan requirements. On October 27, 1999, a

proposed FAR rule was published in the Federal Register (64 FR 57964)

to remove the FAR requirements for DoD use of the clause; these

proposed DFARS amendments would replace the FAR requirements.

This rule was not subject to Office of Management and Budget review

under Executive Order 12866, dated September 30, 1993.

B. Regulatory Flexibility Act

The proposed rule may 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. An Initial Regulatory

Flexibility Analysis has been prepared and is summarized as follows:

The legal basis for the proposed rule is Section 504 of the Indian

Financing

Act of 1974 (25 U.S.C. 1544); Section 8024 of the DoD Appropriations

Act for Fiscal Year 1999 (Public Law 105-262); and Section 8024 of the

DoD Appropriations Act for Fiscal Year 2000 (Public Law 106-79). This

rule will apply to all DoD contractors that have the clause at FAR

52.226-1 incorporated into their contracts. The proposed rule does not

impose any new reporting, recordkeeping, or other compliance

requirements, and does not duplicate, overlap, or conflict with any

other Federal rules. The rule is expected to have a beneficial effect

on small business concerns, because small businesses are now eligible

to receive incentive payments for the use of Indian organizations and

Indian-owned economic enterprises as subcontractors.

DoD has submitted a copy of the analysis to the Chief Counsel for

Advocacy of the Small Business Administration. Interested parties may

obtain a copy of the analysis from the address specified herein.

Comments are invited. Comments from small entities concerning the

affected DFARS subpart also will be considered in accordance with 5

U.S.C. 610. Such comments should be submitted separately and should

cite DFARS Case 99-D300 in correspondence.

C. Paperwork Reduction Act

The Paperwork Reduction Act does not apply because the rule does

not impose any information collection requirements that 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 226

Government procurement.

Michele P. Peterson,

Executive Editor, Defense Acquisition Regulations Council.

Therefore, 48 CFR Part 226 is proposed to be amended as follows:

1. The authority citation for 48 CFR Part 226 continues to read as

follows:

Authority: 41 U.S.C. 421 and 48 CFR Chapter 1.

PART 226--OTHER SOCIOECONOMIC PROGRAMS

2. Sections 226.103 and 226.104 are revised to read as follows:

226.103 Procedures.

(f) The contracting officer must submit a request for funding of

the Indian incentive to the Office of Small and Disadvantaged Business

Utilization, Office of the Under Secretary of Defense (Acquisition,

Technology and Logistics) (OUSD (AT&L) SADBU), 1777 North Kent Street,

Suite 9100, Arlington, VA 22209. Upon receipt of funding from OUSD

(AT&L) SADBU, the contracting officer must issue a contract

modification to add the Indian incentive funding for payment of the

contractor's request for adjustment as described at FAR 52.226-1,

Utilization of Indian Organizations and Indian-Owned Economic

Enterprises.

226.104 Contract clause.

(1) The contracting officer must use the clause at FAR 52.226-1,

Utilization of Indian Organizations and Indian-Owned Economic

Enterprises, in solicitations and contracts that--

(i) Do not use FAR part 12 procedures; and

(ii) (A) Are for supplies or services valued at $500,000 or more;

or

(B) Are for construction valued at $1,000,000 or more.

(2) The contracting officer may use the clause at FAR 52.226-1 in

any solicitation or contract if, in the opinion of the contracting

officer, subcontracting possibilities exist for Indian organizations or

Indian-owned economic enterprises.

[FR Doc. 99-29983 Filed 11-17-99; 8:45 am]

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