January 31, 2017

New FAR Final Rules Issued in January 2017

4 min

Increased Emergency Spending Authority

DoD, GSA, and NASA issued a final rule effective January 13, 2017, that amended the FAR to raise the simplified acquisition threshold for special emergency procurement authority. The rule affects FAR 2.101, 13.003, 19.203, and 19.502-2, which are being revised to increase the special emergency simplified acquisition threshold from $300,000 to $750,000 domestically, and increase the threshold from $1 million to $1.5 million outside of the United States. Covered acquisitions include those for supplies or services that are to be used to support a contingency operation or to facilitate defense against or recovery from nuclear, biological, chemical, or radiological attack. This change will lead to more acquisitions, and could mean larger contracts for vendors following emergency situations.

Source: https://www.federalregister.gov/documents/2017/01/13/2016-31496/federal-acquisition-regulation-acquisition-threshold-for-special-emergency-procurement-authority

SBA 8(a) Program Changes

DoD, GSA, and NASA issued a final rule effective January 13, 2017, amending the FAR to implement regulatory clarifications made by SBA regarding the 8(a) program. The rule revises FAR 19.804-6(a) to clarify that offers and acceptances are required for orders under multiple-award contacts that were not set aside for competition among 8(a) contractors. The rule also revises FAR 19.814(a) to permit the SBA Inspector General to request a formal size determination. Further, the rule revises FAR 19.815 to clarify that any follow-on 8(a) requirement shall remain in the 8(a) program unless there is a mandatory source for the requirement pursuant to FAR 8.002 or 8.002 or SBA agrees to release the requirement for procurement outside of the 8(a) program. The final rule serves to protect and promote the purpose of the 8(a) program going forward.

Source: https://www.federalregister.gov/documents/2017/01/13/2016-31498/federal-acquisition-regulation-contracts-under-the-small-business-administration-8a-program

Prohibition Regarding Contracts Restricting Reporting Fraud, Waste or Abuse

DoD, GSA, and NASA issued a final rule effective January 19, 2017, that amended the FAR to prohibit the use of funds for a contract with an entity that requires employees or subcontractors to sign an internal confidentiality agreement that restricts them from lawfully reporting waste, fraud or abuse to a designated Government representative. The rule specifically cites the agency's Office of the Inspector General (OIG) as a designated investigative or law enforcement representative of a federal department or agency. The rule adds that a contractor is required to give notice only to current employees and subcontractors that any prohibitions and restrictions of any preexisting confidentiality agreements or statements covered by the rule are no longer in effect, to the extent that such prohibitions and restrictions are in conflict with the aforementioned prohibitions. The definition of "internal confidentiality agreement or statement" excludes confidentiality agreements arising out of civil litigation or agreements signed at the behest of a federal agency. This rule encompasses contractors and subcontractors alike. Whether the rule will lead to increased reporting remains to be seen.

Source: https://www.federalregister.gov/documents/2017/01/13/2016-31497/federal-acquisition-regulation-contractor-employee-internal-confidentiality-agreements-or-statements

Ombudsman Jurisdiction over Fair Opportunity Complaints

GSA issued a final rule effective January 9, 2017, that amended the General Services Administration Acquisition Regulation (GSAR) to clarify that the ordering-agency task and delivery order Ombudsman has jurisdiction and responsibility to review and resolve fair opportunity complaints on tasks and delivery orders placed against GSA multiple-award contracts. The final rule also requires the ordering agency to include contact information for their task and delivery order Ombudsman when placing task or delivery orders against GSA multiple-award contracts. Finally, the rule requires the contractor to provide a copy of its complaint to the GSA Procurement Ombudsman at the same time it files its complaint with the ordering agency.

Source: https://www.federalregister.gov/documents/2017/01/09/2016-31932/general-services-administration-acquisition-regulation-gsar-fair-opportunity-complaints-on-gsa

DOT Contracting Initiative Pilot Program Extension

The Department of Transportation (DOT) has extended its contracting initiative pilot program, which became effective on March 6, 2015, for a period of 5 years. Under the pilot program, Federal Highway Administration (FHWA) and Federal Transit Administration (FTA) recipients and subrecipients can utilize contracting requirements that are generally disallowed due to concerns about adverse impacts on competition. The pilot program, which was established to collect data on whether such requirements (like local hire preferences) "unduly limit competition," has only garnered limited data so far. Its extension will enable DOT to gather more data, and will give FHWA and FTA recipients and subrecipients the flexibility to continue to operate under the program.

Source: https://www.federalregister.gov/documents/2017/01/18/2017-00984/contracting-initiative