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Proposed Rule

VA Acquisition Regulation: Plain Language Rewrite

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Information about this document as published in the Federal Register.

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AGENCY:

Department of Veterans Affairs.

ACTION:

Proposed rule.

SUMMARY:

We propose to revise the Department of Veterans Affairs (VA) Acquisition Regulation (VAAR). We have rewritten much of the VAAR to conform to plain language principles. We are changing many delegations of authority for the purpose of becoming more efficient. We are removing non-regulatory material. We are making changes in format, arrangement, and numbering to make the VAAR parallel to the Federal Acquisition Regulation (FAR) as required by the FAR. We are removing provisions that simply restate FAR provisions that are already applicable. This document also proposes to set forth or revise procedures for providing notice and hearing to resolve issues regarding possible violations of the Gratuities clause, establishing qualified products lists, suspending or debarring a contractor, for expediting payments to small businesses, and for reducing or suspending payments upon a finding of contract fraud. We propose to expand the coverage of the VAAR clause on Organizational Conflicts of Interest to cover a broader range of services that may be subject to organizational conflicts of interest. We propose to clarify the scope of certain regulations and to allow use of additional VAAR clauses in commercial item solicitations and contracts, to remove requirements for setting aside construction and architect-engineer solicitations for small businesses that are in conflict with current statute, to remove a requirement to conduct an audit of section 8(a) price proposals that is contrary to current FAR requirements, and to remove a VAAR provision that requested data from offerors on veteran-owned small businesses that has been replaced by a FAR provision. The rule would provide guidance to contracting officers on the types of data that should be requested from a contractor when evaluating the contractor's financial condition. The rule would require the use of the clause on Assignment of Claims in purchase orders, would provide guidance to contracting officers on the criteria for revising the payment due dates for invoices, and would require the use of Alternate I to the clause on Disputes.

DATES:

Comments on the proposed rule should be submitted on or before March 14, 2006 to be considered in the formulation of the final rule.

ADDRESSES:

Written comments may be submitted by: mail or hand-delivery to the Director, Regulations Management (00REG1), Department of Veterans Affairs, 810 Vermont Ave., NW., Room 1068, Washington, DC 20420; fax to (202) 273-9026; e-mail to VARegulations@va.gov; or, through http://www.regulations.gov. Comments should indicate that they are submitted in response to “RIN 2900-AK78.” All comments received will be available for public inspection in the Office of Regulation Policy and Management, Room 1063B, between the hours of 8 a.m. and 4:30 p.m. Monday through Friday (except holidays). Please call (202) 273-9515 for an appointment.

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FOR FURTHER INFORMATION CONTACT:

VAAR partNameTelephone No. and e-mail address
808, 813, 852Cathy Dailey(202) 273-8774; cathy.dailey@mail.va.gov.
803 through 806, 809, 811, 817, 819, 822, 825, 828, 829, 831 through 833, 836, 837, 842, 846, 852, and 873Don Kaliher(202) 273-8819; donald.kaliher@mail.va.gov.
801, 802, 807, 812, 814 through 816, 824, 841, 847, 849, 852, 853, 870, and 871Barbara Latvanas(202) 273-7808; barbara.latvanas@mail.va.gov.

The mailing address for the contact persons is as follows: Acquisition Policy Division (049A5A), Office of Acquisition and Material Management, Department of Veterans Affairs, 810 Vermont Ave., NW, Washington, 20420.

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SUPPLEMENTARY INFORMATION:

When Federal agencies acquire supplies and services using appropriated funds, the purchase is governed by the Federal Acquisition Regulation (FAR), set forth at 48 Code of Federal Regulations (CFR) chapter 1, parts 1 through 53, and the agency regulations that implement and supplement the FAR. These authorities are designed to ensure that Government procurements are handled fairly and consistently, that the Government receives the best value for its money, and that all Government contractors operate under a known set of rules.

The Department of Veterans Affairs (VA) regulations that implement and supplement the FAR are named the VA Acquisition Regulation (VAAR) and are set forth at 48 CFR chapter 8, parts 801 through 873. The wide variety of activities that VA carries out makes it necessary for VA to implement and supplement the FAR. The VAAR covers VA special acquisition needs. We are proposing a number of changes to the VAAR. We have rewritten much of the VAAR to conform to plain language principles and plain language changes have been made to most parts of the VAAR. We propose to change many delegations of authority for the purpose of becoming more efficient. We are removing non-regulatory material. We propose to make changes in format, arrangement, and numbering to make the VAAR parallel to the Federal Acquisition Regulation (FAR) as required by subpart 1.3 of the FAR. We propose to remove provisions that simply restate FAR provisions that are already applicable. We are also proposing to make other changes discussed below.

Part 801, Department of Veterans Affairs Acquisition Regulations System

We propose to amend the “Authority” cites at the beginning of each Department of Veterans Affairs Acquisition Regulation (VAAR) part to correspond to current authority.

We propose to amend the VAAR to use acronyms, such as “VAAR,” in part 801 and throughout the document for many of the common terms used. The new acronyms are referenced in part 802 or, if used only in one part or subpart of the VAAR, in that part or subpart.

We proposed to add new VAAR sections 801.105, Issuance, and 801.105-2, Arrangement of regulations, to explain how the VAAR is structured. The information follows the structure established for the Federal Acquisition Regulation (FAR) at 1.105 and 1.105-2. Start Printed Page 2343The VAAR is intended to supplement the FAR and must follow a similar structural arrangement.

Throughout the document, sections of the VAAR have been renumbered and/or renamed to correspond to the FAR with no significant changes to the material contained therein. For instance, section 801.301-70, Paperwork Reduction Act requirements, has been renumbered and renamed as 801.106, OMB approval under the Paperwork Reduction Act, to correspond to the FAR.

We proposed to add designations for the Department's Chief Acquisition Officer, Senior Procurement Executive (SPE), and Procurement Executive (which is being renamed as the Deputy Senior Procurement Executive (DSPE)), at 802.100, Definitions, to new section 801.304, Agency control and compliance procedures, to delineate responsibilities for compliance with FAR requirements.

We propose to amend VAAR section 801.670-5 by removing previously delegated authority for all officials except the Inspector General to enter into or issue Letters of Agreement. As a result of this proposed change, future acquisitions of the types of services previously acquired under this section (e.g., advisory and assistance services, peer review of research, acquisition of instructor services and training) will be acquired using normal acquisition methods (e.g., purchase orders, micro-purchases using the purchase card). The Office of Inspector General may continue to issue contracts using a letter format due to the sensitive nature of the acquisitions of that office. We believe this proposed amendment will simplify the acquisition process and consolidate acquisition functions within VA.

Subpart 803.2, Contractor Gratuities to Government Personnel

We propose to add VAAR section 803.204 to specify the notification and hearing procedures we would follow before taking an action to terminate a contractor's right to proceed and/or initiate debarment or suspension measures, based on violation of the Gratuities clause. The proposed procedures are modeled after the proposed VAAR provisions at 809.406-3, which set out procedures for debarment. We would make these changes to comply with FAR 3.204.

Subpart 803.7, Voiding and Rescinding Contracts

We propose to add VAAR section 803.705 to specify the notification and hearing procedures we would follow before taking an action to void or rescind a contract based on final conviction for bribery or other offenses, as specified in FAR 3.700. The proposed procedures are modeled after the proposed VAAR provisions at 809.406-3, which set out procedures for debarment. We propose to make these changes to comply with FAR 3.705.

Sections 806.401 and 814.103-1

We propose to remove provisions currently in sections 806.401 and 814.103-1 requiring VA contracting officers to use sealed bidding procedures for any solicitation over the small purchase limitation and for any acquisition expected to exceed $1,000 for repairs of property under 38 United States Code (U.S.C.) Chapter 37. The FAR requires the use of sealed bidding if the acquisition is subject to FAR Part 6 and: (1) Time permits the solicitation, submission, and evaluation of sealed bids; (2) the award will be made on the basis of price and other price-related factors; (3) it is not necessary to conduct discussions with the responding offerors about their bids; and (4) there is a reasonable expectation of receiving more than one sealed bid. We see no reason for a special VAAR rule on these matters. By proposing to remove these VAAR provisions, VA contracting officers would be governed by the FAR. We believe the FAR provisions provide sufficient guidance on when to use sealed bidding procedures.

Subpart 807.3, Contractor Versus Government Performance, and 852.207-70, Report of Employment Under Commercial Activities

We propose to amend Subpart 807.3 to remove the term “employee(s)” to add in its place “personnel” to generally correspond with how the term is used in FAR Subpart 7.3 and in Office of Management and Budget Circular A-76.

Part 809, Contractor Qualifications

We propose to add new section 809.204, Responsibilities for establishment of a qualification requirement, to provide guidance to contracting officers on establishing VA qualified product lists (QPL). Contracting officers may develop a QPL either for local use, for use in VA's Veterans Integrated Service Networks (VISN), or for some other geographical or administrative area. This is consistent with the FAR at Subpart 9.2.

Under current VAAR 809.206(b)(2), a contractor must guarantee that he or she will deliver a product to VA if we agree to accept and test the product for listing on a QPL. We propose to remove this requirement because a guarantee in these circumstances is of no consequence since the terms of a contract for a product are negotiated after the listing of the product on a QPL. A contractor will sell its product to VA if the parties can agree on price and other terms and conditions.

Under current VAAR 809.206(b)(2), when we are establishing a VA QPL, VA gives “known suppliers” of an item the chance to submit a sample item. However, under FAR 8.404, VA may issue a delivery order against a Federal Supply Schedule (FSS) contract without seeking further competition from firms who do not hold FSS contracts and may seek price reductions from FSS contractors. We propose to revise the text currently in 809.206(b)(2) to state that VA may limit “known suppliers” to those contractors whose products are already covered under an FSS contract and to redesignate the provision as 809.204(c)(2). This proposed change would preclude requiring VA to duplicate a full and open competition that has already been conducted to establish the FSS schedule. Our proposed action is consistent with FAR 8.404.

Subpart 809.4, Debarment, Suspension, and Ineligibility

Subpart 809.4 supplements provisions of the FAR concerning the debarment or suspension of contractors. We propose to amend the procedures for debarring or suspending contractors. The proposed procedures include the following:

Under the proposed procedures, when the Debarment and Suspension (D&S) Committee finds evidence of a cause for debarment or suspension, it would conduct an investigation on whether or not to prepare a Notice of Proposal to Debar or Notice of Suspension and make a recommendation to the Deputy Senior Procurement Executive (DSPE).

If the DSPE finds a basis for debarment or suspension, the D&S Committee would send the contractor the Notice of Proposal to Debar or Notice of Suspension. Pursuant to the FAR, a contractor given a Notice of Proposal to Debar or Notice of Suspension is excluded from participating in Federal procurement and non-procurement programs.

The contractor proposed for debarment or suspended may submit information in person or in writing at an informal proceeding or otherwise. If the contractor's objections to the proposed debarment or suspension are based on a genuine dispute over facts material to the action, the dispute would be resolved in a separate preceding before a member of the VA Board of Contract Appeals (an informal trial type hearing Start Printed Page 2344under the procedures in proposed section 809.470).

If there is no such dispute or if all disputes have been resolved, the debarring or suspending official will make a decision based on all available information.

These proposed procedures are designed to ensure that the contractor is provided with an efficient and fair process before a decision is made on whether or not to take a debarment action or to continue with a suspension action.

Subpart 809.5, Organizational and Consultant Conflicts of Interest

The VAAR currently requires that the clause at 852.209-70, Organizational Conflicts of Interest, be inserted in solicitations for consulting services. We propose to require that this clause also be used in solicitations for management support services, other professional services, contractor performance of, or assistance in, conducting technical evaluations; or system engineering and technical direction work. These are the types of services that may be subject to potential organizational and consultant conflicts of interest issues as contemplated by FAR 9.502.

Part 811, Describing Agency Needs

We propose to relocate material from section 811.204 to a new proposed clause at 852.211-75, Product Specifications, without change for purposes of clarity.

Part 812, Acquisition of Commercial Items

We propose to add section 812.102, Applicability, to state that contracts for the acquisition of commercial items are subject to the policies in other parts of the VAAR. However, proposed section 812.102 notes that when a policy in another part of the VAAR differs from a policy in Part 812, Part 812 shall take precedence for the acquisition of commercial items. This proposed section is to make the VAAR consistent with the principles of the FAR at 12.102(c).

We propose to remove the requirement currently at 812.301, Solicitation provisions and contract clauses for the acquisition of commercial items, which requires a contracting officer to include the clause at 852.219-70, Veteran-Owned Small Business, in acquisitions of commercial items because this requirement has been superseded by a similar FAR requirement at 52.212-3. In addition, we propose to make the use of clauses listed in proposed section 812.301, paragraphs (b) and (c), optional rather than mandatory in acquisitions of commercial items and to add the following clauses to the list of clauses in 812.301(b) that may be used in solicitations and contracts for the acquisition of commercial items:

852.209-70, Organizational Conflicts of Interest.

852.211-73, Brand Name or Equal.

852.211-75, Product Specifications.

852.214-71, Restrictions on Alternate Item(s).

852.214-72, Alternate Item(s).

852.214-73, Alternate Packaging and Packing.

852.214-74, Bid Samples.

852.252-70, Solicitation Provisions or Clauses Incorporated by Reference.

We believe the use of these clauses would not be inconsistent with commercial practices. Further, we propose to add the clause at 852.211-74, Liquidated Damages, to proposed paragraph (c), thereby allowing the use of this clause if the contracting officer determines that its use is consistent with commercial practices. We believe that there may be situations where use of a liquidated damages clause would not be inconsistent with commercial practices, such as when failure to deliver supplies or perform services on a timely basis would result in financial harm to the Government.

Part 819, Small Business Programs

We propose to add new section 819.202-1 to allow a contracting officer to prescribe a period less than the standard 30 days for paying a contractor, but not less than 7 days. This proposal is designed to assist small businesses in meeting their financial obligations and is consistent with the FAR requirement at 32.908(c)(2), which does not allow the payment period to be less than 7 days.

We propose to remove provisions currently in section 819.502-2 that require contracting officers to treat certain construction and architect-engineering solicitations as though the Small Business Administration had initiated a set-aside request. These provisions are contrary to the provisions of FAR Subpart 19.10 and underlying statutory authority that provide for unrestricted competition for these services under the Small Business Competitiveness Demonstration Program.

We propose to remove provisions currently in 819.800(d) that require audits to be performed on price proposals under the 8(a) program in excess of $500,000. This matter is covered under FAR 15.404-2, which requires the contracting officer to request an audit only when the information available is inadequate to determine fair and reasonable price. We think that the FAR provision is adequate to protect the Government.

We propose to remove paragraph (b) at section 819.7003 that currently requires the inclusion of the VAAR clause at 852.219-70, Veteran-Owned Small Business, in all solicitations because this requirement has been superseded by a similar FAR requirement at 52.212-3.

Part 832, Contract Financing

We propose to add section 832.006-4 to specify the notification and hearing procedures we would follow before taking an action to reduce or suspend payment to a contractor under FAR 32.006, Reduction or suspension of contract payment upon finding of fraud. We propose to make these changes to comply with FAR 32.006-3, which requires agencies to establish appropriate procedures to implement the policies and procedures of FAR 32.006.

FAR 32.202-1(d) requires an agency to establish procedures for approving the use of unusual contract financing in commercial item acquisitions. We propose to establish those agency procedures in 832.202-1 for approving the use of unusual contract financing because we think they are necessary for ensuring that VA's use of unusual contract financing or commercial advance payment is in the Government's best interest.

FAR 32.202-4(a)(2) states that, subject to agency regulations, the contracting officer may determine that a contractor's financial condition constitutes adequate security for Government financing. The VAAR does not currently say what information a contracting officer should review to assist in making this determination. We propose to add section 832.202-4 setting forth the information a contracting officer should evaluate and consider in determining whether a contractor's financial condition constitutes adequate security. Under this proposal, the contracting officer should obtain any of the following: interim balance sheets or income statements; a cash flow forecast for the contract term; information on contractor financing arrangements disclosing available cash, credit arrangements, and financial exposure; tax account information; descriptions or explanations of documents bearing on the financial vitality of the business; a Dun and Bradstreet report on the company; or any other necessary financial information. Start Printed Page 2345

FAR Subpart 32.9 sets forth policies, procedures, and clauses an agency must follow for implementing the “prompt payment” provisions of 5 CFR 1315. FAR 32.904 sets forth the number of days following receipt of goods or services after which Government acceptance is deemed to have occurred unless certain exceptions apply. Paragraphs (b)(1)(ii), (c)(2), (d)(1), and (d)(2) of FAR 32.904 permit a contracting officer to specify a period of more than 7 days for accepting goods or services or more than 14 days to process progress payments or more than 7 days to process the final payment under a construction contract. We propose to add section 832.904 setting forth the following factors a contracting officer should consider when making a decision whether or not to change the payment period: (1) Recent interest payment history; (2) the complexity of the project; (3) workload; (4) work site location. We believe these proposed changes will assist contracting officers in making determinations that are in the best interest of the Government.

Part 833, Protests, Disputes, and Appeals

The VAAR currently requires the contracting officer to suspend contract performance if notified by GAO of a protest within 10 days of award. We propose to remove this provision. This provision has been superseded by FAR changes at 33.104(c) which state that the contracting officer must suspend contract performance or terminate the awarded contract within 10 days after award or within 5 days after a debriefing date offered to a protester for any debriefing required by FAR 15.505 or 15.506, whichever is later.

In general, prior to passage of the Contract Disputes Act of 1978, as amended (41 U.S.C. 601-613), the obligation to continue contract performance of a contract pending a decision on a claim applied only to claims arising under a contract. However, that Act authorizes agencies to require a contractor to continue contract performance in accordance with the contracting officer's direction pending final decision on a claim relating to the contract. The FAR allows use of this authority only if authorized by an agency. We propose to add sections 833.213 and 833.215 to require the use of this authority in all contracts because we believe this is in the best interest of the Government.

In addition, we propose to remove a statement currently at 833.214(c) that everything discussed at an alternative dispute resolution meeting is confidential. This statement is unwarranted since the agreement between the parties governs confidentiality and the agreement may provide otherwise.

Section 837.270, Special Controls for Letters of Agreement

We propose to remove this section. This section applies to letters of agreement and the section addressing letters of agreement at 801.670-5 is proposed for deletion. If 801.670-5 is deleted, there would be no requirement for this section.

Part 852, Solicitation Provisions and Contract Clauses

We propose to remove section 852.219-70, Veteran-Owned Small Business, because this provision has been superseded by a similar FAR provision in FAR 52.212-3.

We propose to revise clause 852.222-70, Contract Work-Hours and Safety Standards Act—Nursing Home Care Contract Supplement, to correspond to plain language principles, with no substantive change to the intent or meaning of the clause.

We propose to update Alternates I and II of clause 852.236-89, Buy American Act, to correspond to changes made to FAR Part 25. Alternate I would apply to construction contracts valued at $7,611,532 or more, while Alternate II would apply to construction contracts valued between $6,725,000 and $7,611,531.

We propose to revise section 852.270-1 by deleting the term “supervise” and adding, in its place, “monitor.” This is to clarify that VA officials do not supervise the work of contractors.

A number of clauses have been renumbered and/or renamed, as follows (if no name appears in the second column, the clause name remains unchanged). Only those clauses that have been renumbered or renamed are included in this chart. Other clauses may have been changed without being renumbered or renamed.

Current VAAR clause and titleProposed renumbered/ renamed as
852.211-71, Guarantee852.246-70.
852.211-72, Rejected Goods852.246-71, Inspection.
852.211-73, Frozen Processed Foods852.246-72.
852.211-74, Special Notice852.211-71.
852.211-75, Technical Industry Standards852.211-72.
852.211-76, Noncompliance with Packaging, Packing, and/or Marking852.246-73.
852.211-77, Brand Name or Equal852.211-73.
852.211-78, Liquidated Damages852.211-74.
852.214-71, Alternate Item(s)852.214-71, Restrictions on Alternate Item(s); 852.214-72, Alternate Item(s); and 852.214-73, Alternate Packaging and Packing.
852.214-73, Bid Samples852.214-74.
852.233-70 Protest Content852.233-70, Protest Content/Alternative Dispute Resolution.
852.237-71, Indemnification and Insurance852.228-71.
852.246-1, Special Warranties852.246-74.
852.246-2, Warranty for Construction-Guarantee Period Services852.246-75.
852.252-1, Provisions or Clauses that Require Completion by the Offeror or Prospective Contractor852.252-70, Solicitation Provisions or Clauses Incorporated by Reference.
852.270-4, Commercial Advertising852.203-70.
852.271-71, Inspection852.271-74.

The proposed clause content of these clauses remain unchanged with the exception of 852.233-70, Protest Content/Alternative Dispute Resolution, where paragraph (c) is proposed to be added to encourage the use of alternative dispute resolution procedures, as provided in FAR 33.103(c), and clauses 852.271-71, Inspection, and 852.271-74, Inspection, which are proposed to be combined into one clause for simplicity. Start Printed Page 2346

Part 873, Simplified Acquisition Procedures for Health-Care Resources

No substantive changes have been made to VAAR Part 873.

Executive Order 12866

The Office of Management and Budget has reviewed this document under Executive Order 12866.

Unfunded Mandates

The Unfunded Mandates Reform Act of 1995 requires, at 2 U.S.C. 1532, that agencies prepare an assessment of anticipated costs and benefits before issuing any rule that may result in an expenditure by State, local, or tribal governments, in the aggregate, or by the private sector, of $100 million or more (adjusted annually for inflation) in any given year. This proposed rule would have no such effect on State, local, or tribal governments, or the private sector.

Paperwork Reduction Act

Under the Paperwork Reduction Act (PRA) of 1995 (44 U.S.C. 3501-3521), proposed collections of information are contained in Part 832 at sections 832.006-4 and 832.202-4, as set forth in the SUPPLEMENTARY INFORMATION portion of this proposed rule. These are proposed new sections that were not previously contained in the VAAR. This notice is to obtain an Office of Management and Budget (OMB) control number for these sections. As required under section 3507(d) of the Act, VA has submitted a copy of this proposed rulemaking action to OMB for its review of the collection of information.

There are two other proposed new sections in this proposed rule that could potentially require the collection of information from contractors, section 803.204, Treatment of violations, and section 832.705, Procedures. These sections provide agency procedures for taking action against a contractor for violation of the Gratuities clause (see proposed 803.204) or action to void or rescind a contract for violation of 18 U.S.C. 201-224, all as required by the FAR. VA has not taken any action under the two corresponding sections of the FAR in the past several years and there is no likelihood that VA will annually require the collection of information from 10 or more contractors under these provisions in the future. Therefore, these provisions are exempt from the PRA and VA is not requesting PRA approval from OMB for these provisions.

OMB assigns control numbers to collections of information it approves. VA may not conduct or sponsor, and a person is not required to respond to, a collection of information unless it displays a currently valid OMB control number.

Comments on the collection of information should be submitted to the Office of Management and Budget, Attention: Desk Officer for the Department of Veterans Affairs, Office of Information and Regulatory Affairs, Office of Management and Budget, Washington, DC 20503, with copies to the Director, Regulations Management (00REG1), Department of Veterans Affairs, 810 Vermont Ave., NW., Washington, DC 20420. Comments should indicate that they are submitted in response to “RIN 2900-AK78.”

Title and section number: 832.006-4, Procedures.

Summary of collection of information: FAR 32.006 authorizes agencies to reduce or suspend contract payments upon finding of fraud. FAR 32.006-3(a) requires agencies to establish appropriate procedures to implement the policies and procedures of section 32.006. VA is proposing to establish such procedures under section 832.006-4. In order to provide contractors due process when there has been a finding of fraud and when, as a result, VA is proposing to reduce or suspend contract payments, VA must give the contractor notice of that intent and allow the contractor to submit information or argument in opposition to the proposed action.

Description of need for information and proposed use of information: The information will be used by the VA Senior Procurement Executive (the Assistant Secretary for Management) in making a final determination whether or not to reduce or suspend payment under the contract. Submission of this information is voluntary and the collection of the information is intended to give contractors the opportunity to rebut a proposed decision to suspend contract payments.

Description of likely respondents: Entities who have contracts with VA where there has been a finding of fraud on the part of the contractor.

Estimated number of respondents: 10.

Estimated frequency of responses: 1 response for each contract under which there has been a finding of fraud.

Estimated average burden per collection: 5 hours.

Estimated total annual reporting and recordkeeping burden: 50 hours.

Title and section number: 832.202-4, Security for Government financing.

Summary of collection of information: FAR Subpart 32.2 authorizes the use of certain types of Government financing on commercial item purchases. 41 U.S.C. 255(f) requires the Government to obtain adequate security for Government financing. However, FAR 32.202-4(a)(2) provides that, subject to agency regulations, the contracting officer may determine that an offeror's financial condition is adequate security. VA is proposing to issue agency regulations specifying the type of information that the contracting officer should gather to assist the contracting officer in making a determination whether or not an offeror's financial condition constitutes adequate security.

Description of need for information and proposed use of information: The information will be used by the contracting officer to assist in making a determination whether or not the offeror's financial condition is adequate security to permit Government financing of the commercial purchase. Submission of this information is voluntary and collection of this information is intended to give contractors an opportunity to show that their financial condition is adequate security for Government financing.

Description of likely respondents: Offerors that request or require commercial item purchase financing (e.g., commercial interim payments, commercial advance payment) on commercial item acquisitions where the value of the acquisition exceeds $100,000.

Estimated number of respondents: 10.

Estimated frequency of responses: 1 per offer.

Estimated average burden per collection: 1 hour.

Estimated total annual reporting and recordkeeping burden: 10 hours.

The Department considers comments by the public on proposed collections of information in—

  • Evaluating whether the proposed collections of information are necessary for the proper performance of the functions of the Department, including whether the information will have practical utility;
  • Evaluating the accuracy of the Department's estimate of the burden of the proposed collections of information, including the validity of the methodology and assumptions used;
  • Enhancing the quality, usefulness, and clarity of the information to be collected; and
  • Minimizing the burden of the collections of information on those who are to respond, including through the use of appropriate automated, electronic, mechanical, or other technological collection techniques or other forms of information technology, e.g., permitting electronic submission of responses.

OMB is required to make a decision concerning the proposed collection of Start Printed Page 2347information contained in this proposed rule between 30 and 60 days after publication of this document in the Federal Register. Therefore, a comment to OMB is best assured of having its full effect if OMB receives it within 30 days of publication. This does not affect the deadline for the public to comment on the proposed regulation.

Regulatory Flexibility Act

When an agency issues a rulemaking proposal, the Regulatory Flexibility Act (RFA) requires the agency to “prepare and make available for public comment an initial regulatory flexibility analysis” which will “describe the impact of the proposed rule on small entities.” (5 U.S.C. 603(a)). Section 605 of the RFA allows an agency to certify a rule, in lieu of preparing an analysis, if the proposed rulemaking is not expected to have a significant economic impact on a substantial number of small entities.

The Secretary certifies that the adoption of this proposed rule would not have a significant economic impact on a substantial number of small entities as they are defined in the RFA. The primary purpose of this document is to update the existing VAAR to correspond to FAR requirements and internal VA policy and to conform to plain language principles. Many of the changes are internal to VA and do not impact the public, do not impose any requirements on the public, and thus do not have an economic impact on small entities. The changes that do impact the public are of minimal impact.

The addition of procedures for contractor hearings relative to: (1) Violation of the Gratuities clause (section 803.204); (2) voiding or rescinding a contract (section 803.705); and (3) reducing or suspending payment due to fraud (section 832.006-4) only supplement authorities that are already in the FAR and that are rarely used by VA. They do not add any new authorities that VA could not have exercised under the FAR before issuance of this proposed rule and VA has not taken any action under these authorities against small entities over the past several years. Few, if any, actions are expected to be taken in the future. Thus, there is no impact on a substantial number of small entities.

The changes to Subpart 809.4 relative to suspension and debarment are changes to form and not to substance. The basic procedures remain unchanged and there is no change on the impact to small businesses.

The change to 819.202-1 relative to granting small businesses improved payment terms on contracts is not a new authority, but the VAAR lacked guidance on how to exercise this authority. Title 5 CFR 1315.5 already authorizes agencies to pay small businesses as quickly as possible. This change may encourage VA contracting officers to use this authority more often, but the impact of this provision on small business would be both minimal and entirely beneficial. With the advent of purchase cards, small businesses that accept the cards already receive payment within a matter of a few days following their submission of a request for payment to VISA. This proposed rule provision would have no impact on small businesses that accept the purchase card.

The proposed rule would remove a current provision in section 819.502-2 mandating that certain solicitations be treated as though SBA initiated a set-aside request. This provision is inconsistent with the requirements in FAR subpart 19.10 implementing the Small Business Competitiveness Demonstration Program of 1988, Public Law 100-656 (codified as amended at 15 U.S.C. 644 note). Those authorities require that competition for procurement contracts relating to construction and A/E services be unrestricted. Because Public Law 100-656 and FAR subpart 19.10 already prohibit VA from inferring a set-aside request in the circumstances specified in VAAR 819.502-2, the removal of that superseded provision will not have any effect on small entities.

Adoption of the proposed rule changes in sections 803.204, 803.705, and 832.006-4 would not impose more than minimal costs on any small entities, as VA has not taken action under the corresponding FAR provisions over the past several years and we do not expect to take many, if any, actions in future years. The positive financial benefit to small entities of the proposed change to 819.202-1 is also considered to be minimal. The authority to expedite payments already exists under the FAR and we expect few additional cases where this authority will be used as a result of the proposed addition of these provisions to the VAAR. Even where there are additional uses of this authority, the financial benefit to small entities of expedited payment is expected to be minimal. Therefore, under 5 U.S.C. 605(b), this amendment is exempt from the initial and final regulatory flexibility analysis requirements of sections 603 and 604.

Start List of Subjects

List of Subjects

, 809, 811, 836, and 852

, 804, 805, 806, 807, 808, 812, 813, 814, 815, 816, 817, 824, 832, 837, 846, 849, 853, and 873

and 842

End List of Subjects Start Signature

Approved: May 10, 2005.

R. James Nicholson,

Secretary of Veterans Affairs.

End Signature

Editorial Note:

This document was received at the Office of the Federal Register on December 21, 2005.

Start Printed Page 2348

For the reasons set out in the preamble, 48 CFR Chapter 8 is proposed to be revised to read as follows:

CHAPTER 8—DEPARTMENT OF VETERANS AFFAIRS

SUBCHAPTER A—GENERAL

Part

801 Department of Veterans Affairs Acquisition Regulations Systems.

802 Definitions of words and terms.

803 Improper business practices and personal conflicts of interest.

804 Administrative matters.

SUBCHAPTER B—COMPETITION AND ACQUISITION PLANNING

805 Publicizing contract actions.

806 Competition requirements.

807 Acquisition planning.

808 Required sources of supplies and services.

809 Contractor qualifications.

811 Describing agency needs.

812 Acquisition of commercial items.

SUBCHAPTER C—CONTRACTING METHODS AND CONTRACT TYPES

813 Simplified acquisition procedures.

814 Sealed bidding.

815 Contracting by negotiation.

816 Types of contracts.

817 Special contracting methods.

SUBCHAPTER D—SOCIOECONOMIC PROGRAMS

819 Small business programs.

822 Application of labor laws to Government acquisitions.

823 Environment, energy and water efficiency, renewable energy technologies, occupational safety, and drug-free workplace.

824 Protection of privacy and freedom of information.

825 Foreign acquisition.

826 Other socioeconomic programs.

SUBCHAPTER E—GENERAL CONTRACTING REQUIREMENTS

828 Bonds and insurance.

829 Taxes.

830 Cost accounting standards administration.

831 Contract cost principles and procedures.

832 Contract financing.

833 Protests, disputes, and appeals.

SUBCHAPTER F—SPECIAL CATEGORIES OF CONTRACTING

836 Construction and architect-engineer contracts.

837 Service contracting.

839 Acquisition of information technology.

841 Acquisition of utility services.

SUBCHAPTER G—CONTRACT MANAGEMENT

842 Contract administration and audit services.

843 Contract modifications.

844 Subcontracting policies and procedures.

846 Quality assurance.

847 Transportation.

849 Termination of contracts.

SUBCHAPTER H—CLAUSES AND FORMS

852 Solicitation provisions and contract clauses.

853 Forms.

SUBCHAPTER I—DEPARTMENT SUPPLEMENTARY REGULATIONS

870 Special procurement controls.

871 Loan guaranty and vocational rehabilitation and employment programs.

872 [Reserved].

873 Simplified acquisition procedures for health-care resources.

Subchapter A—General

Start Part

PART 801—DEPARTMENT OF VETERANS AFFAIRS ACQUISITION REGULATIONS SYSTEM

801.000
Scope of part.
Subpart 801.1—Purpose, Authority, Issuance
801.101
Purpose.
801.103
Authority.
801.104
Applicability.
801.104-70
Exclusions.
801.105
Issuance.
801.105-2
Arrangement of regulations.
801.106
OMB approval under the Paperwork Reduction Act.
Subpart 801.2— Administration
801.201
Maintenance of the FAR.
801.201-1
The two councils.
Subpart 801.3—Department Acquisition Regulations
801.304
Department control and compliance procedures.
Subpart 801.4—Deviations From the FAR or VAAR
801.403
Individual deviations.
801.404
Class deviations.
Subpart 801.6—Career Development, Contracting Authority, and Responsibilities
801.601
General.
801.602
Contracting officers.
801.602-3
Ratification of unauthorized commitments.
801.602-70
General review requirements.
801.602-71
Basic review requirements.
801.602-72
Exceptions and additional review requirements.
801.602-73
Review requirements for scarce medical specialist contracts and contracts for health-care resources.
801.602-74
Review requirements for an interagency agreement.
801.602-75
Review requirements—OGC.
801.602-76
Business clearance review.
801.602-77
Processing solicitations and contract documents for legal or technical review—general.
801.602-78
Processing solicitations and contract documents for legal or technical review—Veterans Health Administration field facilities, Central Office (except Office of Facilities Management), the National Acquisition Center, and the Denver Distribution Center.
801.602-79
Processing solicitations and contract documents for legal or technical review—Veterans Benefits Administration.
801.602-80
Processing solicitations and contract documents for legal or technical review—Office of Facilities Management.
801.602-81
Documents required for business clearance reviews.
801.602-82
Documents to submit for legal or technical review—general.
801.602-83
Documents to submit for legal or technical review—contract modifications.
801.602-84
Documents to submit for business clearance reviews.
801.602-85
Results of OGC's review.
801.603
Selection, appointment, and termination of appointment.
801.603-1
General.
801.603-70
Representatives of contracting officers.
801.603-71
Representatives of contracting officers; receipt of equipment, supplies, and nonpersonal services.
801.670
Special and limited delegation.
801.670-1
Issuing bills of lading.
801.670-3
Medical, dental, and ancillary service.
801.670-4
National Cemetery Administration.
801.670-5
Letters of agreement.
801.680
Contracting authority of the Inspector General.
801.690
VA's COCP.
801.690-1
Definitions.
801.690-2
General.
801.690-3
Responsibility under the COCP.
801.690-4
Selection.
801.690-5
Requirements for contracting authority.
801.690-6
Appointment.
801.690-7
Termination.
801.690-8
Interim appointment provisions.
801.690-9
Distribution of Certificates of Appointment.
801.695
VA's Appointment of HCAs program.
801.695-1
Policy.
801.695-2
Procedures for appointment of HCAs.
801.695-3
Authority of the HCA.
Start Authority

Authority: 38 U.S.C. 501; 40 U.S.C. 121(c); and 48 CFR 1.301-1.304.

End Authority
Scope of part.

This part sets out general Department of Veterans Affairs (VA) Acquisition Regulation (VAAR) policies, including information regarding the maintenance and administration of the VAAR, acquisition policies and practices, and procedures for deviation from the VAAR and the Federal Acquisition Regulation (FAR).

Subpart 801.1—Purpose, Authority, Issuance

Purpose.

(a) VA established the VAAR to codify and publish uniform policies and Start Printed Page 2349procedures for VA's acquisition of supplies and services, including construction.

(b) The VAAR implements and supplements the FAR.

Authority.

The Secretary issues the VAAR under the authority of 40 U.S.C. 121(c), Title 48 of the Code of Federal Regulations (CFR) 1.301 through 1.304, and other authorities as cited.

Applicability.

(a) Unless otherwise specified in this chapter or excepted by statute (i.e., expenditures of the VA Canteen Service) or other VA regulations, the FAR and VAAR apply to all VA acquisitions (including construction) made with appropriated funds. Supply Fund monies (38 U.S.C. 8121) and General Post Funds (38 U.S.C. 8302) are appropriated funds.

(b) Use the VAAR and the FAR together. The FAR applies to VA acquisitions except as provided in the VAAR.

Exclusions.

The FAR and VAAR do not apply to purchases and contracts that use General Post Funds if using the FAR and the VAAR would infringe upon a donor's right to specify the exact item to be purchased and/or the source of supply (38 U.S.C. 8303).

Issuance.
Arrangement of regulations.

(a) General. The VAAR is divided into subchapters, parts (each of which covers a separate aspect of acquisition), subparts, sections, and subsections.

(b) Numbering. (1) The numbering system permits the discrete identification of every VAAR paragraph. The digits to the left of the decimal point represent the part number. The numbers to the right of the decimal point and to the left of the dash represent, in order, the subpart (one or two digits), and the section (two digits). The number to the right of the dash represents the subsection. Subdivisions may be used at the section and subsection level to identify individual paragraphs.

(2) Subdivisions below the section or subsection level consist of parenthetical alphanumerics using the following sequence: (a)(1)(i)(A)(1)(i)

(c) References and citations. (1) Unless otherwise stated, cross-references indicate parts, subparts, sections, subsections, paragraphs, subparagraphs, or subdivisions of this chapter.

(2) This chapter may be referred to as the Department of Veterans Affairs Acquisition Regulation or the VAAR.

(3) Using the VAAR coverage at 809.106-4(c) as a typical illustration, reference to the—

(i) Part would be “VAAR Part 809” outside the VAAR and “Part 809” within the VAAR.

(ii) Subpart would be “VAAR Subpart 809.1” outside the VAAR and “Subpart 809.1” within the VAAR.

(iii) Section would be “VAAR 809.106” outside the VAAR and “809.106” within the VAAR.

(iv) Subsection would be “VAAR 809.106-4” outside the VAAR and “809.106-4” within the VAAR.

(v) Paragraph would be “VAAR 809.106-4(c)” outside the VAAR and “809.106-4(c)” within the VAAR

(4) Citations of authority (e.g., statutes or Executive orders) in the VAAR shall follow the Federal Register form guides.

OMB approval under the Paperwork Reduction Act.

In accordance with the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3521), the Office of Management and Budget (OMB) has approved the reporting and recordkeeping provisions that are included in the VAAR and has given VA the following approval numbers:

48 CFR part or section where identified and describedCurrent OMB control No.
809.106-12900-0418
809.504(d)2900-0418
8132900-0393
832.006-42900-xxxx
832.202-42900-xxxx
836.606-712900-0208
852.207-702900-0590
852.209-702900-0418
852.211-702900-0587
852.211-712900-0588
852.211-722900-0586
852.211-732900-0585
852.214-702900-0593
852.228-712900-0590
852.236-722900-0422
852.236-792900-0208
852.236-80 (Alt. I)2900-0422
852.236-82 through 852.236-842900-0422
852.236-882900-0422
852.236-892900-0622
852.236-912900-0623
852.237-72900-0590
852.270-32900-0589

Subpart 801.2—Administration

Maintenance of the FAR.
The two councils.

Revisions to the FAR are prepared and issued through the coordinated action of two councils, the Defense Acquisition Regulations Council and the Civilian Agency Acquisition Council. A designee of the Office of Management will represent VA on the Civilian Agency Acquisition Council.

Subpart 801.3—Department Acquisition Regulations

Department control and compliance procedures.

The Assistant Secretary for Management is designated as the Department's Chief Acquisition Officer and Senior Procurement Executive (SPE). The Deputy Assistant Secretary for Acquisition and Materiel Management is designated as the Department's Deputy Senior Procurement Executive (DSPE). The DSPE is responsible for review of the VAAR and amendments to the VAAR for compliance with FAR 1.304.

Subpart 801.4—Deviations From the FAR or VAAR

Individual deviations.

(a) Authority to authorize individual deviations from the FAR and VAAR is delegated to the SPE and is further delegated to the DSPE.

(b) When a contracting officer considers it necessary to deviate from the policies in the FAR or VAAR, the contracting officer must submit a request to the DSPE for authority to deviate.

(c) The request to deviate must clearly state the circumstances warranting the deviation and the nature of the deviation. The head of the contracting activity (HCA) must sign the request.

(d) The DSPE may authorize individual deviations from the FAR and VAAR when an individual deviation is in the best interest of the Government. When the DSPE authorizes a deviation, the contracting officer must file the authorization in the purchase order or contract file.

Class deviations.

Authority to authorize class deviations from the FAR and VAAR is delegated to the SPE and is further delegated to the DSPE. The DSPE may authorize class deviations from the FAR and VAAR when a class deviation is in the best interest of the Government. The DSPE must comply with the provisions of FAR 1.404 through the SPE.

Start Printed Page 2350

Subpart 801.6—Career Development, Contracting Authority, and Responsibilities

General.

(a) A designating official may appoint a contracting officer under FAR 1.603 and VA's Contracting Officer Certification Program (COCP).

(b) The HCA may delegate micro-purchase authority to VA employees under the VA's purchase card program.

(c) An individual may not commit the Government for purchases of supplies, equipment, or services unless the individual has received delegated contracting authority. Individuals making such commitments or acting beyond the scope of their authority may be held financially liable.

Contracting officers.

(a) Except as otherwise provided by statute, VA regulations, the VAAR, or the FAR, the authority vested in the Secretary to do the following is delegated to the SPE and is further delegated from the SPE to the DSPE:

(1) Execute, award, and administer contracts, purchase orders, and other agreements (including interagency agreements) for the expenditure of funds for construction and the acquisition of personal property and services (including architect-engineer services).

(2) Issue bills of lading.

(3) Sell personal property.

(4) Enter into leases, sales agreements, and other transactions.

(5) Prescribe and publish acquisition policies and procedures.

(6) Establish clear lines of contracting authority.

(7) Manage and enhance career development of the procurement work force.

(8) Examine, in coordination with the Office of Federal Procurement Policy, the procurement system to determine specific areas where VA should establish and apply Government-wide performance standards, and to participate in developing Government-wide procurement policies, regulations, and standards.

(9) Oversee the competition advocate program.

(b) The DSPE may further delegate authority to execute, award, and administer contracts, purchase orders, and other agreements to other VA officials, such as HCAs and contracting officers, in accordance with the COCP.

Ratification of unauthorized commitments.

(a) This section applies to unauthorized commitments, including any commitment made by a contracting officer that exceeds that contracting officer's contracting authority and unauthorized commitments made by individuals who lack contracting authority.

(b) A contracting officer must not ratify unauthorized commitments made by other VA personnel or by another contracting officer who lacks authority without prior approval as specified in paragraphs (b)(1) through (b)(3) of this section. The specified approval authorities may not be re-delegated.

(1) At field facilities, for supplies, services (except leases of real property), and construction, the approving authority for unauthorized commitments made by staff assigned to a field facility is the Director of the field facility concerned.

(2) For VA Central Office (VACO) organizations, for supplies, services (except leases of real property), and construction, the approving authorities for unauthorized commitments made by staff assigned to the Administrations are the respective chief financial officers of the Administrations concerned. The approving authority for unauthorized commitments made by staff assigned to any other organization within VACO is the Deputy Assistant Secretary for Acquisition and Materiel Management.

(3) For unauthorized commitments for leasehold interest in real property, the approving authority is:

(i) The Chief Facilities Management Officer, Office of Facilities Management, for unauthorized commitments for 1-5,000 square feet of space or for 1-100 parking spaces costing less than $50,000 per annum.

(ii) The Under Secretary for Health for unauthorized commitments for 5,001-20,000 square feet of space or for more than 100 parking spaces costing less than $100,000 per annum.

(iii) The Deputy Secretary for 20,001 square feet of space and above or for more than 100 parking spaces costing more than $100,000 per annum.

(c) The process for contracting officer requests for ratification will be as follows:

(1) The individual who made the unauthorized commitment will furnish the contracting officer with all records and documents concerning the commitment and a complete written statement of facts that includes the following:

(i) Why the procurement office was not used.

(ii) Why the proposed contractor was selected.

(iii) Other sources that were considered.

(iv) A description of work to be performed or products to be furnished.

(v) The estimated or agreed contract price.

(vi) A citation of the appropriation available.

(vii) A statement of whether the contractor has commenced performance.

(viii) The name of the individual responsible for the unauthorized commitment.

(2) The contracting officer will review the file and forward it to the approving authority specified in paragraph (b) of this section with any comments or information that the approving authority should consider in evaluating the request for ratification. If the approving authority determines that a legal review would be desirable, the approving authority will coordinate the request for ratification with the Office of the General Counsel (OGC) or the Regional Counsel, as appropriate.

(3) If the approving authority authorizes the ratification, the approving authority will return the file to the contracting officer for issuance of a purchase order or contract, as appropriate.

(d) If an otherwise proper contract award exceeds the limits of the contracting officer's delegated authority, the ratifying contracting officer must comply with the above requirements and the approving authority must inform the HCA. The HCA will take action to preclude future instances of such awards.

General review requirements.

(a) Contracting officers shall ensure that any document listed under 801.602-71 through 801.602-76 that is submitted for technical or legal review is submitted through or by an official at least one level above the contracting officer.

(b) Before opening a bid, awarding a contract, or signing a contract-related document as specified in 801.602-71 through 801.602-76, the contracting officer shall ensure that the appropriate VA official, including appropriate staff of the Acquisition Resources Service regional or central office, has reviewed and concurred with the document.

(c) Before signing a contract for a Veterans Benefits Administration field facility for any guidance center or vocational rehabilitation service with an anticipated expenditure of $100,000 or more, the contracting officer shall ensure that the Director, Vocational Rehabilitation and Employment Service, has reviewed and approved the solicitation or proposed contract.

(d) When the following items are for the management, sale, or lease of properties acquired by VA after liquidation of a guaranteed, direct, Start Printed Page 2351acquired, or vendee loan, the review requirements specified in 801.602-71 through 801.602-76 do not apply:

(1) Agreements.

(2) Licenses.

(3) Easements.

(4) Deeds.

(e) If there is insufficient time for the legal review required in 801.602-75(a)(3), the contracting officer (except contracting officers in the Office of Facilities Management) must at least obtain verbal concurrence from Acquisition Resources Service staff before issuing a change order where:

(1) The change order (unilateral agreement) has an anticipated value of $100,000 or more; or

(2) The change order is for a time extension of 60 days or more.

(f) Unless otherwise stated, all dollar values in 801.602-71 through 801.602-76 are expressed in total dollars involved in the acquisition action.

(1) The contracting officer may not consider the positive and negative status of the figures in determining the total dollar values involved.

(2) An acquisition of $550,000 with a trade-in credit of $70,000 would be valued at $620,000 for legal or technical review purposes rather than the net amount of $480,000. An Energy Savings Performance Contract requiring payment from savings of $10,000,000 to the contractor over the life of the contract would be valued at $10,000,000, despite the fact that there is no immediate cost to VA and no payment if there are no savings.

(g) The DSPE may require technical review of any contract-related materials, regardless of dollar value.

(h) Except as set forth in 801.602-73 and 801.602-75, at its discretion, the Office of Acquisition and Materiel Management may request OGC review.

(i) The requirements of this section or sections 801.602-71 through 801.602-76 do not apply to contracts awarded by or on behalf of the VA Office of Inspector General.

(j) Contracting officers and purchase cardholders must ensure compliance with separate guidance on information technology (IT) tracking and approval prior to processing requests for acquisitions of IT and telecommunications software, equipment, and/or services, regardless of dollar value.

Basic review requirements.

Contracting officers must obtain technical review from Acquisition Resources Service staff of the documents set forth in column one of Table 801.602-71 that have anticipated award values equal to or greater than the value in column two.

Table 801.602-71

DocumentAnticipated contract award value
(a) Supply or service solicitations or quotations (except as provided in 801.602-72 through 801.602-75) (includes indefinite quantity, option year, and multi-year solicitations or quotations where the contracting officer reasonably expects expenditures of $500,000 or more, inclusive of options)$500,000 or more.
(b) Supply or service solicitations or quotations where a consolidated acquisition activity is performing acquisitions for three or more physically separated VA medical centers (excluding outpatient clinics)$750,000 or more.
(c) Fixed price, sealed bid construction solicitations, other than 8(a) construction solicitations$1 million or more.
(d) 8(a) construction solicitations and task orders$500,000 or more.
(e) Request for Proposal (negotiated) construction solicitations and task orders$500,000 or more.
(f) Proposed task/delivery orders and blanket purchase agreements (includes orders under Federal Supply Schedule contracts)$500,000 or more.
(g) Proposed cost-reimbursement, incentive, time-and-materials, and labor-hour contracts (see 816.102(b)$100,000 or more.
(h) Utility service agreements$50,000 or more.
(i) Solicitations for advisory and assistance services (see 837.2)$100,000 or more.
(j) Proposed letter contracts and ensuing formal contracts$25,000.
Exceptions and additional review requirements.

(a) In addition to the general review requirements in 801.602-71, contracting officers must obtain technical reviews from Acquisition Resources Service staff of any proposed agreement that is unique, novel, or unusual.

(b) Contracting officers must obtain technical reviews from Acquisition Resources Service staff of the following documents relating to contracts requiring bonds (see FAR 28.102-1 and 28.203 through 28.203-5):

(1) An irrevocable letter of credit.

(2) A tripartite escrow agreement.

(3) An individual surety bond.

(c) Contracting officers must obtain technical review from Acquisition Resources Service staff of each proposed novation and change-of-name agreement (see FAR Subpart 42.12).

(d) Contracting officers must obtain technical review from Acquisition Resources Service staff of any solicitation or proposed contract containing an economic price adjustment clause based on a cost index of material or labor (e.g., the urban consumer price index (CPI-U) (see FAR 16.203-4(d)) or where one of the economic price adjustment clauses specified in FAR 16.203-4 are used.

(e) Contracting officers must obtain technical review from Acquisition Resources Service staff of any proposed multi-year contract where the cancellation ceiling exceeds 20 percent of the contract amount, regardless of the dollar value of the proposed contract (see 817.105-1(b)).

(f) Contracting officers must obtain technical review from Acquisition Resources Service staff of any proposed solicitation where the contract term total of the basic and option periods will exceed 5 years, regardless of the dollar value of the proposed acquisition (see 817.204).

(g) Contracting officers must obtain technical review from Acquisition Resources Service staff of a proposed membership agreement in a group purchasing organization.

(h) Contracting officers must obtain technical review from Acquisition Resources Service staff of proposed termination settlements or determinations of amounts due the contractor under a terminated contract that involve the expenditure of $100,000 or more of Government funds. Acquisition Resources Service staff shall obtain legal review. (See 849.111-70).

(i) Contracting officers must obtain technical review from Acquisition Resources Service staff of each consignment agreement with an anticipated expenditure of $250,000 or more per year (except for a consignment agreement established under, and provided for in, a Federal Supply Schedule contract).Start Printed Page 2352

(j) Contracting officers, including purchase cardholders, must obtain technical and legal review of all proposed contracts for conferences where VA's commitment, expenditure, and liability (combined) exceed $25,000. This dollar figure is based on the combination of all direct costs to VA under the contract (e.g., conference rooms, audio-visual charges, refreshments, catering, etc.) and all potential liability (e.g., room guarantee liability, cancellation costs). Even if there is no direct cost to VA, if the proposed contract includes a guarantee on room usage or a cancellation fee that could potentially exceed $25,000, the proposed contract requires legal and technical review. Signing a contract committing VA to hold a conference at a particular hotel is a procurement, and procurement laws and regulations must be followed.

Review requirements for scarce medical specialist contracts and contracts for health-care resources.

For contracts to be awarded under the authority of either 38 U.S.C. 7409 or 38 U.S.C. 8153, contracting officers must obtain technical and legal reviews from the Medical Sharing Office, OGC, and Acquisition Resources Service staff of the following documents:

(a) Each competitive solicitation, quotation, proposed contract, or agreement with an anticipated contract award value of $1,500,000 or more, inclusive of options.

(b) Each noncompetitive solicitation, quotation, proposed contract, or agreement with an anticipated contract award value of $500,000 or more, inclusive of options.

Review requirements for an interagency agreement.

Contracting officers or other staff must obtain technical review from Acquisitions, Operations, and Analysis Service staff of the following documents:

(a) Each proposed VA Central Office interagency agreement with another Federal agency to be awarded under authority of the Economy Act, regardless of dollar value. For the VA Central Office, only the DSPE or designee may sign an interagency agreement.

(b) Each proposed VA field facility interagency agreement with another Federal agency awarded under authority of the Economy Act, involving an anticipated expenditure of $250,000 or more. A VA field facility contracting officer or a contracting officer at the VA National Acquisition Center or the Denver Distribution Center may sign an interagency agreement if the dollar threshold is within the contracting officer's warrant limit.

Review requirements—OGC.

(a) Contracting officers must obtain legal review or concurrence from OGC for the following categories of proposed contractual actions.

(1) Each contract termination, final decision, cure letter, or “show cause” notice proposed under any contract where the total value of the contract is $100,000 or more. A contracting officer may not sign or release a document subject to this provision until OGC has concurred.

(2) Each dispute or claim from a contractor involving a potential total dollar value of $100,000 or more. A contracting officer may not sign or release a document subject to this provision until OGC has concurred.

(3) Each proposed contract modification, including any proposed modification to a supply or service contract, where the total value of the modification is $100,000 or more (e.g., a modification for a $60,000 increase and a $50,000 decrease equals $110,000).

(4) Each proposed contract modification granting a time extension of more than 60 days. The Director, Acquisition Resources Service, may waive the pre-approval requirement under this paragraph for an individual facility when the Director determines that the facility has obtained appropriate “consideration” for past time extensions and the extensions were otherwise appropriately granted.

(5) Each proposed modification increasing the value of a letter contract, regardless of dollar value.

(6) Each proposed contract modification for which the contractor takes exception to the accord and satisfaction language specified by VA. The contracting officer may not execute any proposed contract modification under this requirement until the contracting officer receives OGC's concurrence in the proposed language.

(7) An assignment of claims (see FAR Subpart 32.8).

(8) Each change or revision to a FAR or VAAR provision or clause or an internal VA-approved clause (e.g., architect/engineer “SP” clauses) not specifically authorized by the regulations.

(9) Each change or revision to a prescribed VA contract form.

(10) A proposed utility construction or connection contract with an anticipated contract award value of $50,000 or more.

(11) Each proposed novation and change-of-name agreement (see 842.1203).

(b) For an action specified in paragraph (a)(1) or (2) of this section, OGC may comment or concur in writing or by telephone.

(c) When a Central Office contracting activity requests legal assistance, the contracting officer will brief OGC on the facts and points of issue to facilitate prompt resolution.

(d) For each solicitation or contract awarded and administered by a Central Office contracting activity, that contracting activity will ask OGC to participate in conferences where legal problems or modifications to contract provisions may be considered and in meetings attended by legal representatives of private parties or other Government agencies. The contracting activity will request assigned procurement counsel participation in drafting correspondence involving significant controversial or sensitive contractual matters.

(e) OGC will prepare any response to the Government Accountability Office (GAO) on GAO bid protests. (See 833.104).

Business clearance review.

(a) A business clearance review is a technical review of all solicitation and contract award or modification documents immediately prior to contract award or modification over the specified dollar threshold.

(b) All VA contracting officers must obtain a business clearance review prior to award of any contract, task or delivery order, or blanket purchase agreement or execution of any contract modification with a value of $5 million or more, or prior to award of any lease with a value of $300,000 or more per year.

(c) The dollar threshold in this paragraph is based on the total dollar value of all awards expected under a single solicitation, not the value of each individual award under a solicitation. For example, a solicitation for home oxygen for a VISN might result in multiple awards, each of which has a value of less than $5 million. If the total of all awards under that solicitation will exceed $5 million, the contracting officer must obtain a business clearance review of the entire package, including all proposed individual awards.

Processing solicitations and contract documents for legal or technical review—general.

(a) Under 801.602-70 through 801.602-76, before taking contract action, a contracting officer must ensure Start Printed Page 2353that any required legal or technical review or concurrence is complete. Contracting officers shall not award or sign contracts, task or delivery orders, blanket purchase agreements, or contract modifications prior to receipt of the final legal and technical review. Should the contracting officer disagree with the advice provided, the contracting officer shall document in the contract file the reasons therefore and provide a copy of that document to the reviewing Office of Acquisition and Materiel Management office. The contracting officer must fully implement any accepted review comments as follows:

(1) Before opening the bid or proposal for a competitively awarded contract.

(2) Before executing contract documents for a contract modification or noncompetitive contract award.

(b) The contracting officer must advise potential bidders or offerors of changes made to the solicitation by issuing an amendment. The contracting officer must give bidders and offerors sufficient time for evaluation before the bid or proposal opens.

Processing solicitations and contract documents for legal or technical review—Veterans Health Administration field facilities, Central Office (except Offices of Facilities Management), the National Acquisition Center, and the Denver Distribution Center.

(a) If legal or technical review is required, the documents listed in Table 801.602-78 must be forwarded for review and approval as shown therein.

Table 801.602-78

DocumentsPerson forwardingForward to
(1) Proposed solicitations, quotations, contract-related documents, and agreements specified in Table 801.602.71 and in 801.602-72Contracting officerAppropriate Acquisition Resources central or regional office.
(2) Scarce medical specialist and health-care resource solicitations, quotations, and proposed contracts (i.e., contracts to be awarded under the authority of 38 U.S.C. 7409 or 8153) specified in 801.602-73Contracting officerMedical Sharing and Purchase Office.
(3) Interagency agreements specified in 801.602-74Approving official, contracting officerDSPE.
(4) Proposed contract modifications, proposed contract modifications for which the contractor takes exception to the accord and satisfaction language VA specifies, assignment of claims, changes to clauses, and proposed utility connection agreements specified in 801.602-75(a)(3) through (a)(7) and in 801.602-75(a)(9) and (a)(10)Contracting officerOGC.
(5) Proposed contract terminations, final decisions, cure letters, show cause notices, disputes, and claims specified in 801.602-75(a)(1) and (a)(2)Contracting officerRegional Office of the General Counsel.

(b) The director of the Acquisition Resources Service office conducting the technical review has authority to determine whether to forward documents for legal review.

(c) When the contractor takes exception to the accord and satisfaction language VA specifies in a proposed contract modification, the contracting officer must not sign the modification until OGC concurs with the language proposed by the contractor.

(d) The contracting officer either must fax or send via overnight mail all of the relevant documents on proposed contract terminations, final decisions, cure letters, show cause notices, disputes, and claims specified in 801.602-75(a)(1) and (a)(2). OGC will provide concurrence or comments either in writing or by telephone. The contracting officer must not sign or release a document to the contractor until OGC concurs.

(e) For any VA contract form subject to legal review under 801.602-75(a)(8), the contracting officer must process the change or revision in accordance with VA Manual MP-1, Part II, Chapter 4 and any supplements to it (http://www.va.gov/​publ/​direc/​benefits/​mp1p2ch4.htm).

Processing solicitations and contract documents for legal or technical review—Veterans Benefits Administration.

(a) A Veterans Benefits Administration contracting officer must ensure that proposed solicitations, quotations, contract-related documents, and agreements listed in Table 801.602-71 are reviewed by the Office of Resource Management prior to document execution. The Office of Resource Management must request legal review of all these documents.

(b) A Veterans Benefits Administration contracting officer must ensure that proposed solicitations or agreements for guidance center and vocational rehabilitation services are reviewed by the Director, Vocational Rehabilitation and Employment Service, if there is an anticipated expenditure of $100,000 or more.

Processing solicitations and contract documents for legal or technical review—Office of Facilities Management.

An Office of Facilities Management contracting officer must submit items specified in 801.602-71, 801.602-72 and 801.602-75 directly to OGC for review.

Documents required for business clearance reviews.

When a bid or offer, proposed contract modification, or proposed lease requires a business clearance review under 801.602-76, the contracting officer must forward the required documents (see 801.602-84) and the following information to the appropriate Acquisition Resources Service central or regional office (Office of Facilities Management contracting officers shall forward the documents to the Office of the General Counsel (025)):

(a) The date on which award is anticipated.

(b) Results or efforts made to determine whether the contractor is responsible under FAR Subpart 9.4.Start Printed Page 2354

(c) A determination of price reasonableness.

(d) An explanation (e.g., the source selection decision as specified in FAR 15.308) if the contracting officer proposes an award to a contractor other than the low responsible bidder or offeror.

Documents to submit for legal or technical review—general.

Table 801.602-82 specifies the documents that must be submitted when a legal or technical review is required.

Table 801.602-82

Action or document subject to reviewDocuments to submit
(a) Proposed construction contractOne copy of each solicitation document, excluding drawings. Submit not later than the date on which the contracting officer furnishes the documents to prospective bidders.
(b) Proposed solicitation contract for scarce medical specialist services or health-care resourcesOne copy of the solicitation or proposed or contract and documents required under VA Manual M-1, Part 1, Chapter 34.
(c) All other proposed solicitations, contracts, and agreementsOne copy of each document to be used in the contract solicitation or award, and any other document that supports the proposed procurement action. Submit not later than the date on which the contracting officer furnishes the documents to prospective bidders.
Documents to submit for legal or technical review—contract modifications.

(a) The documents specified in this section related to proposed contract modifications must be submitted to Acquisition Resources Service for review under one or more of the following conditions:

(1) When the total modification value is $100,000 or more.

(2) When the modification is for a time extension of 60 days or more.

(3) Where the contractor takes exception to VA's accord and satisfaction language.

(b) The contracting officer must submit the following documents for review:

(1) A draft of the proposed modification prepared on SF 30, Amendment of Solicitation/Modification of Contract, specifying the exact language proposed and describing any change in work, time, or cost.

(2) A statement describing the need for the changed work with any back-up documentation, including a copy of the general statement of work in the original contract and any existing contract language that will be modified.

(3) A statement addressing whether the proposed modification is within the original scope of the contract and specifically addressing the facts considered in reaching the conclusion.

(4) A statement analyzing what necessitated the modification (e.g., a design error, technical changes, or medical center requirements).

(5) The contracting officer's technical representative's (COTR) technical evaluation of the proposed change.

(6) A memorandum from the appropriate office indicating that funds are available or a statement concerning the actions that must be taken to secure the required funds.

(7) The names and telephone numbers of the contracting officer and COTR.

(8) Costing information including the following:

(i) The contractor's cost proposal in the format required by the contract.

(ii) The COTR's independent cost evaluation.

(iii) The architect/engineer's independent cost evaluation, if applicable and available.

(iv) The contracting officer's Price Negotiation Memorandum under FAR 15.406-3.

(v) Any other relevant costing information, such as independent market research, that VA used or will use as negotiation criteria.

(c) For a proposed modification to an architect/engineer contract, the contracting officer must submit for review each document specified in paragraph (b) of this section and the following additional documents.

(1) A listing of the fees awarded in the original contract and previous modifications.

(2) For a working drawing contract, a statement regarding the actual or estimated cost of the original construction and any estimated change to the overall project cost as a result of the proposed modification.

(d) For a modification to a construction contract or, where applicable, to an architect/engineer contract, the contracting officer must submit for review a copy of the COTR's mark-up of any drawing that delineates the proposed changed work, including a copy of any pertinent technical specifications. When there is a proposed modification involving numerous changes to drawings and specifications for a VA Central Office project, the drawings and specifications must be available for review in the Office of the Project Director in VA Central Office.

Documents to submit for business clearance reviews.

A contracting officer must submit to Acquisition Resources Service (Office of Facilities Management contracting officers shall forward the documents to the Office of the General Counsel (025)) for review copies of the following documents when a business clearance review is required in accordance with 801.602-76:

(a) The request for contract action, including a justification of need (i.e., the using service purchase request).

(b) The solicitation.

(c) The abstract of the subject bid or offer.

(d) Any applicable Price Negotiation Memorandum.

(e) A statement of the contracting officer's rationale for award.

(f) Any applicable justification and approval under FAR 6.303 and 6.304.

(g) Documents relevant to determining whether the contractor is responsible, including:

(1) Verification that the vendor is not suspended, debarred, or on the Department of Health and Human Services Exclusionary List;

(2) Verification that the vendor has filed any required VETS 100 report (not required if the acquisition is for a commercial item); and

(3) For acquisitions exceeding $10 million, the Equal Employment Opportunity Clearance.

(h) Any applicable approved subcontracting plan.

(i) Documents relevant to price reasonableness.

Results of OGC's review.

(a) When its review is complete, OGC will advise the appropriate Central Office activity or contracting officer that the proposal was approved as submitted or provide them with recommended Start Printed Page 2355changes. If the Central Office activity is notified, the Central Office activity will forward the information to the contracting officer.

(b) When changes are recommended by OGC, if the contracting officer concurs, the contracting officer must take immediate action to amend the document. If the contracting officer does not concur, the contracting officer must discuss the recommended changes with the attorney involved and document in the contract file the reasons why the contracting officer is not following OGC's recommendations.

(c) OGC will complete its review as expeditiously as possible, with due regard for procurement actions that require an unusually short period for completing the procurement.

Selection, appointment, and termination of appointment.
General.

VAAR 801.690 through 801.690-9 and 801.670 establish the policy and procedures for selecting, appointing, and terminating a contracting officer.

Representatives of contracting officers.

(a) In carrying out the responsibilities of FAR 1.602-2, the contracting officer may designate another Government employee or another contractor as COTR to perform the functions in this section and 801.603-71.

(1) Except as indicated in 801.603-71, a designation under this section must be written, must define the scope and limitation of the representative's authority, and must be addressed to the COTR with a copy forwarded to the contractor.

(2) The COTR may not re-delegate authority received under this paragraph.

(3) The contracting officer may not authorize a representative to make any commitment or change that will affect the price, quantity, quality, or delivery terms of a contract.

(4) A contracting officer acting within his or her warranted contracting authority must authorize any change to a contract.

(b) A contracting officer may authorize his or her technical representative to do the following:

(1) Furnish technical guidance and advice or generally supervise the work performed under the contract.

(2) Take any action authorized in the contract, such as issuing a delivery order, rejecting an unsatisfactory item, ordering a replacement of an unsatisfactory item (materials or services) or declaring a contractor in default on specific delivery orders.

(i) Except for a contract for blood, the contracting officer may delegate this authority only to other Government contracting officers under centralized indefinite delivery type contracts and the contract will so state.

(ii) A centralized contract for blood must state that a contracting officer at an ordering office may designate representatives and alternate representatives to place a delivery order subject to the same restrictions in paragraph (b)(3) of this section.

(3) Place an oral or other informal delivery order for items such as, but not limited to, bread, milk, and blood against a local indefinite delivery type contract for which there is a blanket purchase arrangement and for which funds have been obligated.

(c) In the administration of research and development contracts, any representative appointed under this section must be acceptable to the contracting officer and the administration head or staff office director concerned.

(d) When the contracting officer intends to designate a representative under this section for a particular solicitation or contract, the contracting officer must include the clause in 852.270-1, Representatives of Contracting Officers, in the solicitation and contract.

Representatives of contracting officers; receipt of equipment, supplies, and nonpersonal services.

(a) Without prior notification to the contractor or vendor, the contracting officer may designate other competent personnel to represent him or her to receive and inspect supplies, equipment and services at a VA facility. The COTR may perform duties such as, but not limited to, the following:

(1) Inspect and certify compliance with the quality and quantity requirements of the purchase order or contract.

(2) Inspect supplies and equipment for condition and quantity and accept supplies, equipment, and services, based on quality inspection made by another authorized representative.

(b) The Director, Library Services, VA Central Office, and the Chief, Library Service, at a field facility may act as representatives of the contracting officer to receive, inspect and accept library books, newspapers, and periodicals. Purchase documents will specify that delivery will be made directly to the library.

Special and limited delegation.

The authority vested in the Secretary to execute, award, and administer a contract, purchase order, or other agreement for the expenditure of funds to acquire the specific services set forth in 801.670 through 801.670-4 is delegated to the SPE. The SPE further delegates this authority to the DSPE and to employees appointed or designated to the positions specified in these sections.

Issuing bills of lading.

The authority to issue bills of lading previously contained in this section is rescinded. Except for individual small package shipments (e.g., United Parcel Service, Federal Express, or United States Postal Service small package shipments), no VA employee may issue a bill of lading or otherwise procure transportation services for goods unless the employee has been delegated authority to do so as a warranted contracting officer under the VA Contracting Officer Certification Program (ref. 801.690). All transportation services for goods, other than for small package shipments, require a bill of lading. Except for individual small package shipments, individuals with only micro-purchase authority may not issue bills of lading or otherwise procure transportation services. The dollar value of the bill of lading issued or transportation services acquired must not exceed the delegated authority of the contracting officer. Candidates for appointment as transportation contracting officers whose delegated authority will be limited to the acquisition of transportation services for goods only shall comply with the Education, Experience, and Core Training requirements, if any, in Part 102-117 of title 41 Code of Federal Regulations, the Federal Management Regulation, rather than the requirements in 801.690.

Medical, dental, and ancillary service.

(a) When medical, dental, and ancillary services under $10,000 per authorization are not available from an existing contract or agreement, the following VA officials at VA medical facilities may authorize these services:

(1) The Chief of Staff and the physician assigned the responsibility for the ambulatory care function.

(2) Chief, Medical Administration Service.

(3) Person designated by the facility director to perform medical administration functions.

(b) Forms specified in Part 853 shall be used for ordering services under this paragraph from existing contracts.

(c) The officials named in paragraph (a) of this section may designate one or more of their subordinates to exercise Start Printed Page 2356the authority in paragraph (a) of this section.

(d) A designation under this section must be in writing and specifically set forth the scope and limitations of the designee's authority.

National Cemetery Administration.

The Directors of Logistics Management Service, the Centralized Contracting Division, and the Construction Support Division are authorized to procure supplies, equipment and non-personal services (including construction) for National Cemetery Administration (NCA) field facilities and other NCA offices when there is an emergency during which the servicing supply organization cannot be used.

Letters of agreement.

(a) Letters of agreement shall not be used. The authority previously contained in this section is rescinded.

(b) The VA Office of Inspector General may issue contracts for commercial items, including services, using a letter format (see FAR 12.204(a)), provided billing information and required clauses are included in the contract. If the dollar value of the acquisition will exceed the simplified acquisition threshold, this is a deviation from the requirement to use Standard Form 1449 at FAR 12.204(a).

Contracting authority of the Inspector General.

(a) Under section 6(a) of Public Law 95-452 (October 12, 1978), the Inspector General may do the following:

(1) Contract or arrange for audits, studies, analyses, and other services with public agencies and with private persons.

(2) Make payments necessary to carry out the provisions of the Act, to the extent and in amounts provided in advance by appropriations acts.

(b) In exercising the special authority provided in paragraph (a) of this section, the Inspector General may ask the servicing head of the contracting activity for assistance in developing appropriate contract or agreement documents.

(c) The FAR applies to contracts made under paragraph (a) of this section. Such contracts also are subject to provisions of the VAAR that implement and supplement the FAR on matters other than those stemming from or related to delegations of the Secretary's contracting authority. (For example, management controls and approvals specified in Subpart 837.2 will not apply to contract actions under the contract authority of the Inspector General.)

VA's COCP.

The provisions of 801.690 through 801.690-9 establish the policy and procedures for the VA-wide Contracting Officer Certification Program (COCP).

Definitions.

Accredited college or university means a college or university that has been accredited by an accrediting agency recognized by the U.S. Department of Education (see http://www.ed.gov/​admins/​finaid/​accred/​index.html) or accredited by a foreign government.

ACEP means the Acquisition Continuing Education Program, a program to provide VA's acquisition workforce with classroom knowledge to further develop their acquisition skills. The program supports VA personnel in the GS 1102 contracting series, other contracting officers (regardless of General Schedule series), contracting officers' technical representatives, and contracting officers' representatives to ensure that they meet the continuing education requirements mandated by OFPP Policy Letter No. 05-01, Developing and Managing the Acquisition Workforce, dated April 15, 2005 (see http://www.whitehouse.gov/​omb/​procurement/​policy_​letter_​05-01.html) and other official guidance.

Acquisition Workforce means those VA employees who are classified as: GS 1102 contract specialists; GS 1105 purchasing agents; contracting officers warranted above the micro-purchase threshold; program and project managers and other significant acquisition-related positions as otherwise identified by the VA Chief Acquisition Officer; contracting officers' technical representatives; and contracting officers' representatives. The acquisition workforce also includes a limited number of employees that perform significant acquisition-related responsibilities, (e.g., employees in the GS 345, GS 801, GS 1101, GS 1106, GS 1170, GS 2001, GS 2003, and GS 2005 job series and select program officials).

Appointment means the delegation of authority to any VA employee to enter into, administer, or terminate contracts and to make related determinations and findings.

ATCD means the Acquisition Training and Career Development Division.

Certificate of Appointment as Contracting Officer is a signed certificate on Standard Form 1402 used for the written appointment of contracting officers that states the scope, limitation, and term of the contracting officer's authority.

CLP means continuous learning points, as provided in OFPP Policy Letter 05-01. One CLP is generally equivalent to one hour of classroom training.

COCB means the Contracting Officers Certification Board, a group of VA officials, listed at 801.690-3(b), who evaluate and recommend to the DSPE individuals for delegation of contracting authority as Level II or Level III (Senior Limited or Unlimited) contracting officers.

COCP means the Contracting Officers Certification Program, VA's program established for the selection, appointment, and termination of appointment of contracting officers.

COQS means the Contracting Officer Qualification Statement, a document completed by a candidate for a position as contracting officer that accompanies the request for contracting authority. The certified statement includes information on experience, education, training, and pertinent contracting authority information. The COQS is accompanied by supporting documentation such as training certificates, copies of prior and current warrants, college transcripts, and other relevant information.

Federal Acquisition Certification (see OFPP Policy Letter 05-01, paragraph 8) means a certification program developed by the Federal Acquisition Institute and OFPP that generally reflects a Government-wide standard for education, training, and experience leading to the fulfillment of core competencies in acquisition-related disciplines.

Selection means the appointment of an employee as a contracting officer. The selection process shall consider the complexity and dollar value of the assigned work, the candidate's experience, training, education, business acumen, judgment, character, reputation, and knowledge of acquisition policies, rules and regulations.

Skills Currency means the level of knowledge and abilities that a GS 1102 contract specialist or a contracting officer attains as the result of participating in a minimum of 80 CLPs of continuing education or training every two years. The training is intended to ensure that the employee maintains current acquisition knowledge and skills, as mandated by OFPP Policy Letter No. 05-01 and other official guidance.

Termination means the revocation or rescission of an appointment as contracting officer.

General.

(a) The VA COCP applies to all programs of VA except for the Start Printed Page 2357appointment of contracting officers under the Inspector General Act (Public Law 95-452) and for contracting officers designated in 801.670 through 801.670-5. The COCP also applies to VA officials granted authority to enter into sales agreements (see separate guidance under VA's Directives Management System)

(b) A Certificate of Appointment is not required for a contracting officer designated in 801.670 who exercises special and limited delegations of authority.

(c) The COCP is based on the following levels and types of authority:

(1) Level I. Authority for expenditures at or below the simplified acquisition threshold (see FAR 2.101) for open market contracts, blanket purchase agreements, basic ordering agreements, and delivery/task orders against established contracts (except Federal Supply Schedule (FSS) contracts), within the specified geographical limits of the contracting officer's warrant. For FSS contracts, Level I authority includes authority for expenditures up to the maximum order threshold of the FSS contract, within the specified geographical limits of the contracting officer's warrant. This level was formally titled “Basic” and any current Basic Level warrant need not be reissued solely to change the title.

(2) Level II. Authority for expenditures at or below $5,000,000 or as stated on Standard Form 1402 for open market contracts, blanket purchase agreements, basic ordering agreements, and delivery/task orders against established contracts, within the specified geographic limits of the contracting officer's warrant. This level was formally titled “Intermediate” and any current Intermediate Level warrant need not be reissued solely to change the title.

(3) Level III (Senior Limited). Authority for expenditures at or below the dollar threshold and within the geographical limits specified on the contracting officer's warrant, Standard Form 1402. This level was formally titled “Senior Limited” and any current Senior Limited Level warrant need not be reissued solely to change the title.

(4) Level III (Senior Unlimited). Authority granted to VA's contracting officers in contracting activities (e.g., the VA National Acquisition Center, Hines, IL, and Acquisition Operations Service, VA Central Office, Washington, DC) that are charged with meeting Department-wide acquisition needs of VA and its customers. The authority is for expenditures at any dollar level without geographical restriction. This level was formally titled “Senior Unlimited” and any current Senior Unlimited Level warrant need not be reissued solely to change the title.

(5) Multi-VISN. Authority at the Level II and Level III (Senior Limited) Levels, granted by the DSPE, that permits procurement consolidations among Veterans Health Administration VISNs, Veterans Benefits Administration Area Offices, and other Government agencies that exist outside the contracting officer's normally assigned geographical area of appointed authority. Multi-VISN authority is generally granted for procurement-specific requirements or to groups or consortiums established for regional contracting initiatives.

(d) Micro-purchase Level. Micro-purchase Level authority, not to exceed the micro-purchase threshold (currently $2,500 ($2,000 for construction), see FAR 2.101) is separately addressed under VA's purchase card program. Under that program, the HCA may delegate authority to a VA employee as a purchase cardholder through the issuance of VA Form 0242.

Responsibilities under the COCP.

(a) DSPE. The DSPE is responsible for the following:

(1) Administering and overseeing the COCP;

(2) Appointing and terminating Level II and Level III (Senior Limited and Unlimited) contracting officers;

(3) Establishing and developing additional agency-specific training and determining the levels of contracting authority needed under the COCP; and

(4) Developing and implementing policy, procedures, and guidance for VA's acquisition program.

(b) The Chief, Acquisition Program Management Division. The Chief, Acquisition Program Management Division, serves as the Executive Secretary to the COCB and is responsible for the following:

(1) Coordinating requests for contracting authority with the COCB;

(2) Proceeding accordingly with appropriate action to carry out the decisions of the DSPE and the COCB;

(3) Maintaining individual records on the appointment and termination of appointment of contracting officers. Records on contracting officers include HCA certifications and qualification statements, Certificates of Appointment, and other supporting documentation used to grant authority; and

(4) Ensuring appropriate and timely disposition of records through Office of Acquisition and Materiel Management's Records Control Officer.

(c) The COCB. (1) The Director, Acquisition Resources Service, will chair the COCB.

(2) COCB membership consists of:

(i) The Chief, Acquisition Program Management Division; and

(ii) The Director, ATCD.

(d) HCAs. HCAs are responsible for the following:

(1) Implementing and maintaining an effective and efficient program for the procurement of personal property and nonpersonal services required by the activity to which the HCA is assigned.

(2) Establishing adequate controls to ensure compliance with applicable laws and regulations;

(3) Appointing or terminating the appointment of contracting officers at the Micro-purchase and Level I Levels within their assigned activity;

(4) Establishing procedures and maintaining records for the appointment and termination of appointment of Level I contracting officers and purchase cardholders at the Micro-purchase Level. Records maintained on contracting officers shall include the contracting authority, certification and qualification statements;

(5) Recommending to the DSPE the appointment or termination of appointment of contracting officers at the Level II and Level III (Senior Limited or Unlimited) Levels of authority, certifying the candidate's qualifications, and justifying the organizational need;

(6) Ensuring that all GS 1102 contract specialists and other contracting officers meet the minimum core training and continuing education requirements; and

(7) Certifying that the assigned acquisition workforce meets the minimum training, education, and skills currency requirements prescribed by OFPP and the DSPE.

(e) VA Acquisition Workforce. All employees identified as members of VA's acquisition workforce (see 801.690-1) are responsible for maintaining records that include certificates of acquisition training, continuing education, college transcripts, work experience, and other supporting documentation needed to substantiate successful completion of all warrant requirements. These employees shall enroll in VA's Center for Acquisition and Materiel Management Education Online (CAMEO) and in the Acquisition Career Management Information System (ACMIS), the data systems that serve as the repositories of required information on VA's acquisition workforce.

Selection.

(a) The HCA may appoint Level I contracting officers or submit written requests to the DSPE for appointment of Level II or Level III (Senior Limited or Start Printed Page 2358Unlimited) contracting officers. A VA official one level above the HCA may submit a written request to the DSPE for the appointment of a HCA as a contracting officer.

(b) Appointment can only be requested in those circumstances where it can be demonstrated that a valid organizational need exists. In making this assessment and justification, the HCA will consider the complexity of the work, volume of actions, organizational structure, and human resource management actions and forecasts, such as rates of retirement, reassignment, and retention.

(c) The request shall consist of the following:

(1) Justification for requesting contracting authority to be granted;

(2) Certification that the candidate's experience and training meet the established minimum qualifications for the requested contracting authority;

(3) Certification that the candidate has a satisfactory-or-above performance rating;

(4) Certification that the candidate maintains high standards of conduct and avoids apparent or actual conflicts of interest, and

(5) Certification that the candidate has appropriate working knowledge of the FAR, VAAR, and other applicable laws, regulations, policies and procedures.

(d) The accompanied COQS shall include the following information:

(1) Candidate's name, position title, series, grade, and location;

(2) Candidate's relevant acquisition or business-related experience that reflects the required number of years of progressive work assignments leading to broader technical abilities;

(3) Education background, including number of acquisition or business-related college credits;

(4) List of core training requirements or equivalent courses that have been successfully completed;

(5) List of continuing education requirements successfully completed within the last two years;

(6) List of current and prior warrant authorities, limitations, and information on termination and cause for termination;

(7) List of other acquisition related activities or memberships;

(8) Certification that the statement is accurate and complete to the best of the candidate's knowledge; and

(9) Attached copies of acquisition or business-related training certificates, course certificates, and diplomas, transcripts, or degrees from accredited colleges or universities.

Requirements for contracting authority.

(a) Effective January 1, 2007, no individual, regardless of job series, may be issued a new contracting officer warrant above the micro-purchase threshold unless the individual meets the requirements for Federal Acquisition Certification (Certification) for the applicable warrant level as specified in OFPP Policy Letter 05-01 and other official guidance. A new contracting officer warrant is defined in OFPP Policy Letter 05-01 as a warrant issued for the first time at a department or agency. Certification will not be required for current warranted contracting officers at their current warrant level to retain their current warrant, but will be required before a higher level warrant can be issued. Certification includes minimum requirements for education, training, and experience. A candidate for a warrant must have at least a satisfactory-or-above performance rating during the most recent performance period.

(b) Until January 1, 2007, the minimum requirements for qualifying as a contracting officer specified in Tables 801.690-5(b)(1) and 801.690-5(b)(2) shall apply.

Table 801.690-5(b)(1)

For level IFor level II
(i) Experience6 months of progressive work assignments and orientation within the last 3 years in an acquisition-related field2 years of progressive work assignments within the last 4 years in an acquisition-related field leading to broader technical abilities.
(ii) EducationHigh School Diploma or General Educational Development (GED)For Grades GS-12 and below, a Bachelor's Degree or 24 business's related college credits from an accredited college or university; or
For GS 13 and above, a Bachelor's Degree that is supplemented by or includes 24 business-related college credits from an accredited college or university.
(iii) Skills Currency (Minimum number of CLPs every 2 years)80 CLPs80 CLPs.
(iv) PerformanceSatisfactory-or-aboveSatisfactory-or-above.
(v) Core Training, as follows (or approved equivalent courses):For Level III (Senior Limited)For Level III (Senior Unlimited)
Basic Acquisition Course or Simplified Acquisition Procedures CourseXX.
Acquisition Planning I (2 week course)X.
Contract Formation IX.
Contract Administration IX.
Negotiation TechniquesX.
Cost AnalysisX.
Price AnalysisX.
Acquisition Planning IIX.
Contract Formation IIX.
Contract Administration IIX.
Start Printed Page 2359

Table 801.690-5(b)(2)

For level III (senior limited)For level III (senior unlimited) (national programs)
(i) Experience3 years of progressive work assignments in an acquisition-related field leading to broader technical abilities within the last 5 years6 years of progressive work assignments in acquisition, 3 years of which were in an acquisition-related field leading to broader technical ability within the last 5 years.
(ii) EducationBachelor's Degree that is supplemented by or includes 24 business-related college credits from an accredited college or universityBachelor's Degree that is supplemented by or includes 24 business-related college credits from an accredited college or university.
(iii) Skills Currency (Minimum number of CLPs every 2 years)80 CLPS80 CLPs.
(iv) PerformanceSatisfactory-or-aboveSatisfactory-or-above.
(v) Core Training, as follows (or approved equivalent courses):
All courses required of a Level II contracting officer as specified in Table 801.690-5(b)(1)XX.
Intermediate Contract Pricing (2 week course)XX.
Government Contract Law (2 week course)XX.

(c) Effective January 1, 2007, before an individual can be issued a Level I warrant for acquisitions above the micro-purchase threshold, an individual will be required to meet the Certification requirements in OFPP policy guidance. The minimum education and training requirements for a Level I warrant are expected to include a baccalaureate degree or 24 semester hours of business-related college credits and approximately 240 CLPs (six weeks) of acquisition-related classroom training.

(d) Multi-VISN. The HCA shall obtain written concurrence from other affected VISNs or Area Offices when requesting Multi-VISN contracting authority.

(e) Core Training. (1) Contracting officers and non-warranted contract specialists shall complete the required coursework and on-the-job training needed to possess the established competencies listed in OFPP's Federal Acquisition Institute Contract Specialist Training Blueprints (http://www.fai.gov/​prodev/​contract.htm).

(2) The Chief, ATCD, oversees the ATP and the 11 core training courses listed in Tables 801.690-5(b)(1) and 801.690-5(b)(2).

(3) Training course equivalency will be determined and approved by Chief, ATCD. Candidates should contact the Chief, ATCD, for an equivalency determination and must furnish any information or evidence necessary to support the request. Appeals of decisions may be made to the VA Chief Acquisition Officer and the decisions of the Chief Acquisition Officer shall be final.

(f) Skills Currency. (1) Contracting officers and non-warranted contract specialists who have completed the core training requirements shall obtain a minimum of 80 CLPs of continuing education or training every two fiscal years to stay abreast of current acquisition knowledge and skills as mandated by OFPP. The HCA (for Level I contracting officers) and the Chief, ATCD (for Level II and Level III contracting officers), shall make written determinations each October 1st on whether or not the required CLPs, as specified in OFPP guidance, were completed during the two prior fiscal years. The HCA shall assign CLP values to training taken by Level I contracting officers for training that does not have pre-assigned CLP or continuing education unit (CEU) values assigned to the training by the provider. The Chief, ATCD, shall assign CLP values to training taken by Level II and Level III contracting officers for training that does not have pre-assigned CLP or continuing education unit (CEU) values assigned to the training by the provider. Values shall be assigned based on guidance provided by OFPP and the combined efforts of the Federal Acquisition Institute and the Defense Acquisition University. Disputes regarding the CLP or CEU values assigned to training shall be resolved by the Associate Deputy Assistant Secretary for Acquisitions.

(2) The Chief, ATCD, is responsible for the management of the ACEP, the program that assists contracting officers and contract specialists to meet the training requirements.

(3) An expiring warrant will not be re-issued if the contracting officer has not met the continuing education or training requirement.

(g) Education. (1) The 24 business-related college credits shall be in any combination of the following fields of study at an accredited college or university: Accounting, business, finance, law, contracts, purchasing, economics, industrial management, marketing, quantitative methods, or organization and management.

(2) The Chief, ATCD, will make the final determination whether a course is accepted as business-related for the purpose of granting contracting authority.

(3) American Council on Education (ACE) credits are not considered as college credits until they are converted and included on a transcript from an accredited college or university.

(h) Grandfather Provision for the Education Requirement. (1) VA contracting officers, regardless of grade level, who currently hold Level I, Level II, or Level III (Senior Limited or Unlimited) warrants are considered as having met the Experience, Education, and Core Training requirements in Tables 801.690-5(b)(1) and 801.690-5(b)(2) for that warrant level. This includes transfers or laterals to other VA contracting activities with similar geographical restrictions. Contracting officers who are promoted up to a GS-12 can maintain their current warrant level authority.

(2) This Grandfather provision does not cover new VA employees, current VA employees who are not warranted, or former VA employees who held contracting authority at their previous Federal Government agencies or VA positions. VA contracting officers who are promoted to GS 13-and-above will no longer be covered by this Grandfather provision and, therefore, must meet the current Experience, Education, and Core Training requirements for the specific warrant authority that they currently hold or to which they wish to be appointed. Start Printed Page 2360Contracting officers requesting a higher level warrant (e.g., from Level I to Level II or from Level III (Senior Limited) to Level III (Senior Unlimited)) must also meet the current Experience, Education, and Core Training requirement for the specific warrant authority requested.

(3) This Grandfather provision for retaining a contracting officer's current warrant authority is voided if the contracting officer does not fully meet the minimum Skills Currency requirement prior to warrant expiration or when the warrant authority is suspended or revoked. The contracting officer will then need to meet all of the current warrant prerequisites before a new warrant can be issued or before the suspended or revoked warrant can be reinstated.

(i) The training requirements for contracting officers whose delegated authority is limited to the acquisition of transportation services, as provided in Part 102-117 of title 41 Code of Federal Regulations, the Federal Management Regulation, shall be as specified therein.

(ii) [Reserved]

Appointment.

(a) Only the DSPE (for Level II and Level III (Senior Limited or Unlimited)) and the respective HCA (for Level I) may sign the Certificate of Appointment as Contracting Officer. HCAs are authorized to grant Micro-purchase Level and Level I contracting authority up to the thresholds specified for these authorities at 801.690-2(c). The HCA may recommend a candidate to the DSPE for appointment as a Level II or Level III contracting officer. Only the DSPE may grant Level II, Level III (Senior Limited or Unlimited), and Multi-VISN authority.

(b) All Certificates of Appointment as Contracting Officers and other written documents must clearly state any limitations or restrictions on the authority.

(c) The Privacy Act of 1974 applies to the information collected during contracting officer selection and appointment.

Termination.

(a) The DSPE (for all Levels) or HCA (for Micro-purchase Level and Level I) may revoke or rescind the appointment of a contracting officer at any time. HCAs may submit a recommendation to revoke or rescind the appointment of a contracting officer's Level II or Level III (Senior Limited or Unlimited) warrant to the DSPE. Revocation may be based on the following circumstances:

(1) There is no longer a need for the appointment;

(2) There has been a personnel action such as a resignation, retirement, transfer;

(3) Unsatisfactory performance;

(4) Alleged official misconduct pending criminal or administrative investigations;

(5) Failure to meet training or skills currency requirements;

(6) A contracting officer taking an action that exceeds his or her authority;

(7) Blatant disregard for adhering to acquisition regulations, policies and procedures; or

(8) Situations similar to those in paragraphs (a)(1) through (7) of this section that may require remedial action.

(b) The HCA should discuss a termination of contracting authority for cause with the servicing Human Resource Management Office to determine the impact, if any, on the contracting officer's continued employment.

(c) All changes in the status (e.g., departure; name, position, or grade change) of a micro-purchase cardholder or Level I warrant holder shall be reported in writing by the individual's supervisor to the HCA within five workdays of occurrence. All changes in the status of a Level II or Level III (Senior Limited or Unlimited) warrant holder shall be reported in writing by the HCA to the DSPE within five workdays of occurrence. Level II or Level III (Senior Limited or Unlimited) warrants that are terminated, rescinded or superseded should be returned to the Director, Acquisition Resources Service (049A5), citing the exact reason for the termination, rescission, or supersession.

Interim appointment provisions.

(a) To ensure availability of procurement support, an interim appointment may be granted for a limited period of time when a candidate does not fully meet the minimum qualifications for Experience, Education, or successful completion of all acquisition Core Training requirements in Tables 801.690-5(b)(1) or 801.690-5(b)(2), if applicable, or as provided in OFPP guidance. All interim appointments made after January 1, 2007, for individuals who do not meet the minimum Experience, Education, or Core Training requirements for Levels I through III shall be signed by the SPE, without power to redelegate, as provided in OFPP guidance.

(1) In a request for an interim appointment, the HCA must include the information required by 801.690-4 on the candidate's training, experience, performance, and education, and a justification for the interim appointment.

(2) The HCA must ensure that the candidate with interim appointment meets the minimum Experience, Education, and Core Training requirements within the time specified on the warrant.

(3) A contracting officer with interim appointment should successfully complete all remaining required courses or equivalent courses within the time specified on the warrant.

(b) At the HCA's written request, a permanent warrant may be issued during the interim appointment period when the contracting officer has satisfactorily met the requirements. The appropriate documentation (copies of course certificates) must be submitted with the HCA's request.

(c) An interim appointment may be appropriate for instances such as organizational changes or sudden, extreme, and unexpected increases in workload complexity and/or volume.

(d) Interim appointments will not be granted under the following circumstances:

(1) To a candidate who is warranted but does not meet the Education or Core Training requirements for higher level (e.g., from Level I to Level II) contracting authority (unless waived by the SPE);

(2) To a candidate who does not have a current record of satisfactory-or-above performance; or

(3) To a contracting officer whose authority has expired and who has not met the continuing education requirement during the two preceding years.

(e) Generally, an interim appointment may not exceed one year.

Distribution of Certificates of Appointment.

(a) The DSPE or HCA will issue an original Certificate of Appointment as Contracting Officer to the appointed candidate, who must display the Certificate at his or her duty station.

(b) The HCA shall file a copy of the warrant in the delegation of authority file.

(c) The contracting officer must furnish a copy to the respective fiscal activity.

(d) Each Certificate will be serially numbered, reflecting the facility number, the year of issuance (e.g., facility number—year of issuance (2 digits)—sequential number, 560-04-10), and have an effective and expiration date.

Start Printed Page 2361
VA's Appointment of HCAs Program.
Policy.

(a) VA's policy is to have a minimum number of HCAs. Generally, there will be one HCA per VISN, other major VA organizational element, or major acquisition organization. The authority vested in the Secretary to select, appoint, and terminate HCAs is delegated to the SPE and is further delegated from the SPE to the DSPE.

(b) Under the FAR at 1.601(a) and 2.101, an HCA is a senior level position. The official who occupies this position should have the education, training, and experience necessary to make the decisions required of an HCA.

(c) Except as provided in the FAR, an HCA may delegate his or her authority to other individuals within the HCA's acquisition activity. Such delegations must be in writing and must set forth the specific limitations on the designee's authority. The delegation may include authority to appoint a contracting officer at the Micro-purchase or the Level I Levels (see 801.690-2).

Procedures for appointment of HCAs.

An HCA must be appointed in writing by the DSPE and in accordance with internal VA policy. The written delegation must state any limitation on the HCA's authority, other than a limitation contained in an applicable law or regulation.

Authority of the HCA.

(a) The HCA has overall responsibility for managing the procurement program assigned to the activity.

(b) The HCA's level of contracting authority, if any, shall be specified in the HCA's appointment letter.

(c) The HCA has the authority to appoint and terminate contracting officers with authority to conduct procurements of up to and including simplified acquisition threshold or the maximum order threshold or limitation for orders placed against Federal Supply Schedule contracts, and to terminate such appointments (Micro-purchase and Level I Levels).

End Part Start Part

PART 802—DEFINITIONS OF WORDS AND TERMS

Subpart 802.1—Definitions
802.101
Definitions.
Start Authority

Authority: 40 U.S.C. 121(c) and 48 CFR 1.301-1.304.

End Authority

Subpart 802.1—Definitions

Definitions.

A/E means architect/engineer.

Chief Acquisition Officer means the Assistant Secretary for Management.

COTR means Contracting Officer's Technical Representative or Contracting Officer's Representative.

D & S Committee means the VA Debarment and Suspension Committee, a committee consisting of the Director, Acquisition Resources Service (chair), and representatives of the Office of Management, Office of Inspector General, and the program office to which the particular debarment or suspension case relates. A representative from OGC will serve as legal counsel to the D & S Committee.

Debarring official means the DSPE, who is also the Deputy Assistant Secretary for Acquisition and Materiel Management. Authority to impose debarment is delegated to the SPE and is further delegated to the DSPE.

DSPE means the Deputy Senior Procurement Executive, who is also the Deputy Assistant Secretary for Acquisition and Materiel Management. The DSPE must be career member of the Senior Executive Service.

FAR means the Federal Acquisition Regulation.

GAO means the Government Accountability Office.

HCA means the Head of the Contracting Activity, an individual appointed in writing by the DSPE under VA's Appointment of HCAs Program (see 801.695).

OGC means the Office of the General Counsel.

SPE means the Senior Procurement Executive who is also the Assistant Secretary for Management. The SPE is responsible for the management direction of the VA acquisition system. The SPE may further delegate authority to the DSPE.

Suspending official means the DSPE. Authority to impose suspension is delegated to the SPE and is further delegated to the DSPE.

VA means the Department of Veterans Affairs.

VAAR means the Department of Veterans Affairs Acquisition Regulation.

VISN means Veterans Integrated Service Network, an integrated network of VA facilities that are focused on pooling and aligning resources to best meet local needs in the most cost-effective manner and provide greater access to care.

End Part Start Part

PART 803—IMPROPER BUSINESS PRACTICES AND PERSONAL CONFLICTS OF INTEREST

Subpart 803.1—Safeguards
803.101
Standards of conduct.
803.101-3
Department regulations.
803.104
Procurement integrity.
803.104-7
Violations or possible violations.
Subpart 803.2—Contractor Gratuities to Government Personnel
803.203
Reporting suspected violations of the Gratuities clause.
803.204
Treatment of violations.
Subpart 803.3—Reports of Suspected Antitrust Violations
803.303
Reporting suspected antitrust violations.
Subpart 803.4—Contingent Fees
803.405
Misrepresentations or violations of the Covenant Against Contingent Fees.
Subpart 803.5—Other Improper Business Practices
803.502
Subcontractor kickbacks.
803.570
Commercial advertising.
803.570-1
Policy.
803.570-2
Contract clause.
Subpart 803.6—Contracts with Government Employees or Organizations Owned or Controlled by Them
803.602
Exceptions.
Subpart 803.7—Voiding and Rescinding Contracts
803.703
Authority.
803.705
Procedures.
Subpart 803.8—Limitation on the Payment of Funds to Influence Federal Transactions
803.804
Policy.
803.806
Processing suspected violations.
Subpart 803.70—Contractor Responsibility to Avoid Improper Business Practices
803.7000
Display of the VA Hotline poster.
803.7001
Contract clause.
Start Authority

Authority: 38 U.S.C. 501; 40 U.S.C. 121(c); and 48 CFR 1.301-1.304.

End Authority

Subpart 803.1—Safeguards

Standards of conduct.
Department regulations.

(a) Part O of 38 Code of Federal Regulations (CFR) states the standards of conduct for all VA employees, including contracting officials.

(b) Subpart B of 38 CFR Part O states the employee financial disclosure requirements.

Procurement integrity.
Violations or possible violations.

(a) Contracting officers must forward the information required by FAR 3.104-7(a)(1) to the HCA. In consultation with Start Printed Page 2362OGC, the HCA may make the determination and concurrence specified in FAR 3.104-7(a)(1).

(b) Upon receipt of information describing a violation or possible violation of subsections 27(a), (b), (c), or (d) of the Office of Federal Procurement Policy Act of 1974 (see FAR 3.104-3), the HCA will take action in accordance with FAR 3.104-7(b). The HCA must also report violations or possible violations to the VA Office of Inspector General.

(c) The authority to make the determinations specified in FAR 3.104-7(b)(5) and 3.104-7(d)(2)(ii)(B) is delegated to the SPE and is further delegated to the DSPE.

(d) As provided in FAR 3.104-7(f), the HCA may authorize a contracting officer to award a contract after notifying the DSPE of the circumstances warranting such an award.

Subpart 803.2—Contractor Gratuities to Government Personnel

Reporting suspected violations of the Gratuities clause.

(a) Any VA employee must report a suspected violation of the Gratuities clause to the contracting officer or a higher level VA official.

(b) The report must identify the contractor and the personnel involved, provide a summary of the pertinent evidence and circumstances that indicate a violation, and include any other available supporting documentation.

(c) The contracting officer or higher level official must supplement the file with appropriate information and promptly forward the report to the DSPE, with copies to the VA Office of the Inspector General and the Assistant Secretary for Management.

Treatment of violations.

In providing the notice and hearing required by FAR 3.204, the SPE may make the determinations required by FAR 3.204. This authority is further delegated to the DSPE. The DSPE shall use the following procedures to determine whether or not a violation of the Gratuities clause has occurred:

(a) Upon receipt of an allegation or evidence of a violation of the Gratuities clause, the DSPE shall refer the matter to the D & S Committee to conduct a fact-finding. Upon completion of the fact-finding, the D & S Committee shall present the facts and recommendations for further action to the DSPE.

(b) If the DSPE finds a basis for further action, the D & S Committee shall prepare a notice under FAR 3.204 for signature of the DSPE. If suspension or debarment is also being considered, the D & S Committee shall also follow the procedures contained in 809.4. The signed notice will be sent to the last known address of the contractor, the contractor's counsel, or agent for service of process, by certified mail, return receipt requested, or any other method the provides signed evidence of receipt. In the case of a business, the D & S Committee may send the notice to any partner, principal, officer, director, owner or co-owner, or joint venture.

(c) If VA does not receive a reply from the contractor within 45 calendar days of sending the notice, the D & S Committee will prepare a recommendation and refer the case to the DSPE for a decision on whether or not to take further action under FAR 3.204.

(d) If VA receives a reply from the contractor within 45 calendar days of sending the notice, the D & S Committee must consider the information in the reply before the D & S Committee makes its recommendation to the DSPE.

(e) The D & S Committee, upon the request of the contractor, must, as soon as practicable, allow the contractor an opportunity to appear before the D & S Committee, in person or through a representative, to present information or argument. The contractor may supplement the oral presentation with written information and argument. The proceeding will be conducted in an informal manner and without requirement for a transcript. The D & S Committee shall prepare a report of the presentation for submission to the DSPE and must consider the information presented when making its recommendation to the DSPE.

(f) If the D & S Committee finds that the contractor's submission in opposition to further action under FAR 3.204 raises a genuine dispute over facts material to the action, then the D & S Committee shall submit to the DSPE the information establishing the dispute of material facts. If the DSPE agrees that there is a genuine dispute of material facts, the DSPE shall refer the dispute to the VA Board of Contract Appeals for resolution under 809.470. The DSPE may reject the findings of the fact-finding official only if the findings are clearly erroneous or arbitrary and capricious.

(g) If there are no disputes over material facts or if all disputes over material facts have been resolved under 809.470, the DSPE will make a decision on the basis of all information available, including findings of facts and oral or written arguments presented or submitted to the D & S Committee by the contractor. The DSPE should consider any mitigating factors, such as those listed at FAR 9.406-1 and 809.406-1, prior to making a final decision.

Subpart 803.3—Reports of Suspected Antitrust Violations

Reporting suspected antitrust violations.

(a) Any VA employee who suspects or has evidence of possible antitrust violations must report the suspected violations, in accordance with FAR 3.303, to the VA Office of Inspector General and to the Assistant Secretary for Management for review and submission to OGC.

(b) Either the General Counsel or the Inspector General will determine whether to submit the case to the U.S. Attorney General.

Subpart 803.4—Contingent Fees

Misrepresentations or violations of the Covenant Against Contingent Fees.

(a) A VA employee who suspects or has evidence of an attempted or actual exercise of improper influence, misrepresentation of a contingent fee arrangement, or any other violation of the Covenant Against Contingent Fees must report the matter to the contracting officer or to the VA Office of Inspector General.

(b) In addition to the requirement in paragraph (a) of this section, a contracting officer must report a suspected or actual misrepresentation or violation to the DSPE.

(c) Before taking any administrative action under FAR 3.405, a contracting officer must consult with his or her Regional Counsel. A contracting officer in the Central Office must consult with OGC.

(d) Contracting officers shall route any referrals of suspected fraudulent or criminal matters to the Department of Justice under FAR 3.405(b)(4) through OGC or the VA Office of Inspector General, with a copy to the Assistant Secretary for Management. The General Counsel or the Inspector General will determine whether to forward the referral to the Department of Justice.

Subpart 803.5—Other Improper Business Practices

Subcontractor kickbacks.

A VA employee who suspects a violation of the Anti-kickback Act must report the suspected violation to OGC for review.

Start Printed Page 2363
Commercial advertising.
Policy.

It is VA policy that contractors will not advertise the award of contracts or refer to VA contracts in contractors' commercial advertising in such a manner as to state or imply that VA endorses a product, project, or commercial line of endeavor. The intent of this policy is to preclude the appearance of bias toward any product or service.

Contract clause.

The contracting officer must insert the clause at 852.203-70, Commercial advertising, in solicitations and contracts expected to equal or exceed the micro-purchase threshold.

Subpart 803.6—Contracts with Government Employees or Organizations Owned or Controlled by Them

Exceptions.

The authority to authorize an exception to the policy in FAR 3.601 is delegated to the SPE and is further delegated to the DSPE.

Subpart 803.7—Voiding and Rescinding Contracts

Authority.

The authority to make determinations under FAR Subpart 3.7, Voiding and Rescinding Contracts, is delegated to the SPE and is further delegated to the DSPE.

Procedures.

In making a determination to void or rescind a contract, the DSPE must follow the procedures of FAR 3.705 and the following:

(a) Upon receipt of an allegation or evidence of situations meeting the provisions of FAR 3.700, the DSPE shall refer the matter to the D & S Committee to conduct a finding of facts. Upon completion of the fact-finding, the D & S Committee shall present the facts and recommendations for further action to the DSPE.

(b) If the DSPE finds a basis for further action, the D & S Committee shall prepare a notice under FAR 3.705 for signature of the DSPE. If suspension or debarment is being considered, the D & S Committee shall also follow the procedures of 809.4. The signed notice will be sent to the last known address of the contractor, the contractor's counsel, or registered agent, by certified mail, return receipt requested. In the case of a business, the D & S Committee may send the notice to any partner, principal, officer, director, owner or co-owner, or joint venture.

(c) If VA does not receive a reply from the contractor within 30 calendar days of receipt of the notice by the addressee, the D & S Committee will prepare a recommendation and refer the case to the DSPE for a decision on whether or not to take further action under FAR 3.705.

(d) If VA receives a reply from the contractor within 30 calendar days of receipt of the notice, the D & S Committee must consider the information in the reply before the D & S Committee makes its recommendation to the DSPE.

(e) The D & S Committee, upon the request of the contractor, must, as soon as practicable, allow the contractor an opportunity to appear before the D & S Committee, in person or through a representative, to present information or argument. The contractor may supplement the oral presentation with written information and argument. The proceeding will be conducted in an informal manner and without requirement for a transcript. The D & S Committee shall prepare a report of the presentation for submission to the DSPE.

(f) If the D & S Committee finds that the contractor's submission in opposition to further action under FAR 3.705 raises a genuine dispute over facts material to the action, then the D & S Committee shall submit to the DSPE the information establishing the dispute of material facts. If the DSPE agrees that there is a genuine dispute of material facts, the DSPE shall refer the dispute to the VA Board of Contract Appeals for resolution under 809.470. The DSPE may reject the findings of the fact-finding official only if the findings are clearly erroneous or arbitrary and capricious.

(g) If there are no disputes over material facts or if all disputes over material facts have been resolved under 809.470, the DSPE will make a decision on the basis of all information available, including findings of facts and oral or written arguments presented or submitted to the D & S Committee by the contractor.

Subpart 803.8—Limitation on the Payment of Funds To Influence Federal Transactions

Policy.

A contracting officer must forward a copy of all contractor disclosures furnished under the clause at FAR 52.203-12, Limitations on Payments to Influence Certain Federal Transactions, to the Director, Acquisition Resources Service, for subsequent submission by the Secretary to Congress.

Processing suspected violations.

A VA employee must report suspected violations of 31 U.S.C. 1352, Limitation on Use of Appropriated Funds to Influence Certain Federal Contracting and Financial Transactions, to the Assistant Secretary for Management and the VA Office of Inspector General.

Subpart 803.70—Contractor Responsibility To Avoid Improper Business Practices

Display of the VA Hotline poster.

(a) Under the circumstances described in paragraph (b) of this section, a contractor must display prominently a VA Hotline poster prepared by the VA Office of Inspector General in a common work area within a business segment performing work under a VA contract.

(b) A contractor must comply with paragraph (a) of this section when all of the following apply:

(1) The contractor is awarded a VA contract for $500,000 or more for supplies or services, or $3 million or more for construction.

(2) The contractor has not established an internal reporting mechanism and program, such as a hotline, by which employees may report suspected instances of improper conduct, and instructions that encourage employees to make such reports.

Contract clause.

The contracting officer must insert the clause at 852.203-71, Display of Department of Veterans Affairs Hotline Poster, in solicitations and contracts expected to equal or exceed the dollar thresholds established in 803.7000.

End Part Start Part

PART 804—ADMINISTRATIVE MATTERS

Subpart 804.1—Contract Execution
804.101
Contracting officer's signature.
Start Authority

Authority: 40 U.S.C. 121(c) and 48 CFR 1.301-1.304.

End Authority

Subpart 804.1—Contract Execution

Contracting officer's signature.

(a) If a contracting officer's name and title has been typed, stamped, or printed on the contract, and that contracting officer is not available to sign the contract, another contracting officer, as specified in 801.602, may sign the contract.

(b) The contracting officer who signs the contract must have contracting authority to cover the contract to be Start Printed Page 2364signed and must annotate his or her name and title below his or her signature.

End Part

Subchapter B—Competition and Acquisition Planning

Start Part

PART 805—PUBLICIZING CONTRACT ACTIONS

Subpart 805.2—Synopses of Proposed Contract Actions
805.202
Exceptions.
805.205
Special situations.
805.207
Preparation and transmittal of synopses.
Start Authority

Authority: 40 U.S.C. 121(c) and 48 CFR 1.301-1.304.

End Authority

Subpart 805.2—Synopses of Proposed Contract Actions

Exceptions.

In accordance with FAR 5.202, the contract actions in 806.302-5 do not require synopsizing.

Special situations.

(a) A contracting officer may procure paid advertising in a daily newspaper circulated in the local area to publicize a proposed procurement of A/E services not expected to exceed $10,000. See FAR 5.101(b)(4)(i) and 5.502(a).

(b) A contracting officer may procure paid advertising in a daily newspaper circulated in the local area or in professional journals to publicize a proposed procurement of professional services (e.g., scarce medical specialist services, health-care resources, advisory and assistance services). See FAR 5.101(b)(4)(i) and 5.502(a).

Preparation and transmittal of synopses.

(a) When an A/E evaluation board is ready to advertise for A/E services, the board must establish the geographic area within which it will consider A/E firms (including joint ventures).

(b) The geographic area must be large enough to assure selection of three to five firms highly qualified for the particular project involved, but not so large as to make the evaluation process unduly burdensome.

End Part Start Part

PART 806—COMPETITION REQUIREMENTS

Subpart 806.3—Other Than Full and Open Competition
806.302
Circumstances permitting other than full and open competition.
806.302-5
Authorized or required by statute.
806.302-7
Public interest.
806.304
Approval of the justification.
Subpart 806.5—Competition Advocates
806.501
Requirement.
806.570
Planning requirements.
Start Authority

Authority: 38 U.S.C. 501; 40 U.S.C. 121(c); and 48 CFR 1.301-1.304.

End Authority

Subpart 806.3—Other Than Full and Open Competition

Circumstances permitting other than full and open competition.
Authorized or required by statute.

(a) Full and open competition need not be provided for when awarding:

(1) Scarce Medical Specialist contracts negotiated under the authority of 38 U.S.C. 7409, but only when such contracts are with institutions affiliated with VA under 38 U.S.C. 7302. (38 U.S.C. 7409)

(2) Contracts for health-care resources negotiated under the authority of 38 U.S.C. 8153, but only when such contracts are with institutions affiliated with VA under 38 U.S.C. 7302, including medical practice groups and other approved entities associated with affiliated institutions (entities will be approved if determined legally to be associated with affiliated institutions), or with blood banks, organ banks, or research centers. The justification and approval requirements of FAR 6.303 and 806.304 do not apply to such contracts or agreements. (38 U.S.C. 8153)

(3) Contracts for health-care resources, negotiated under the authority of 38 U.S.C. 8153, that are not acquired under the authority of paragraph (a)(2) of this section, but only when the procurement is conducted in accordance with Part 873. The justification and approval requirements of FAR 6.303 and 806.304 shall apply to such contracts and agreements conducted on a sole-source basis. (38 U.S.C. 8153)

(b) Various sections of title 38 U.S.C. authorize the Secretary to enter into certain contracts and certain types of contracts without regard to any other provisions of law. When the contracting officer enters into a contract without providing full and open competition for any of the following items or services, the contracting officer must cite 41 U.S.C. 253(c)(5) and the following authorities:

(1) For, contracts for orthopedic and prosthetic appliances and related services including research, cite 38 U.S.C. 8123. (38 U.S.C. 8123)

(2) For contracts to purchase or sell merchandise, equipment, fixtures, supplies and services for the operation of the Veterans Canteen Service, cite 38 U.S.C. 7802. (38 U.S.C. 7802)

(3) For contracts or leases for the operation of parking facilities established under authority of 38 U.S.C. 8109(b), provided that the establishment, operation, and maintenance of such facilities have been authorized by the Secretary or designee, cite 38 U.S.C. 8109(f). (38 U.S.C. 8109)

(4) For contracts for laundry and other common services, such as the purchase of steam, negotiated with non-profit, tax-exempt, educational, medical, or community institutions, when specifically approved by the Secretary or designee and when such services are not reasonably available from private commercial sources, cite 38 U.S.C. 8122(c). (38 U.S.C. 8122)

(5) For contracts or agreements with public or private agencies for services of translators, cite 38 U.S.C. 513. (38 U.S.C. 513)

(6) For contracts for nursing home care, cite 38 U.S.C. 1720. (38 U.S.C. 1720)

(c) Except for an acquisition under paragraph (a)(2) of this section, the contracting officer must provide a justification under FAR 6.303 and obtain an approval under 806.304 for each acquisition described in this section.

Public interest.

(a) When the contracting officer uses 41 U.S.C. 253(c)(7) to support a contract award using other than full and open competition, the contracting officer must prepare a Determination and Finding (D&F) under FAR 1.7 and a justification under FAR 6.303. The D&F must be signed by the Secretary.

(b) The contracting officer must submit the D&F and justification through the HCA to the Agency Competition Advocate for signature by the Secretary. The submission must include the date the contracting officer expects to award the contract.

(c) VA must notify Congress 30 days before the expected award date. The Agency Competition Advocate is responsible for preparing this notice. The contracting officer may not award the contract until notified by the Agency Competition Advocate.

Approval of the justification.

(a) For a justification other than a class justification specified in FAR 6.304(c), Table 806.304-1 provides the authorities who may approve a justification: Start Printed Page 2365

Table 806.304.1

Proposed contract amountApproving authorityAlternate approving authority
(1) Not exceeding $500,000The contracting officer, as provided in FAR 6.304(a)(1)Not applicable.
(2) Over $500,000 but not exceeding $10 millionContracting Activity Competition Advocate (see 806.501(b) and (c)) unless that Advocate is the contracting officerThe Agency Competition Advocate (see 806.501(a)).
(3) Over $10 million but not exceeding $50 millionAgency Competition AdvocateNot applicable.
(4) Over $50 millionSenior Procurement Executive (see 802.100)Not applicable.

(b) For class justifications specified in FAR 6.304(c), the contracting officer must obtain the approval of the Agency Competition Advocate for all proposed justifications with an estimated value of up to $50 million. The contracting officer must obtain the approval of the SPE for all proposed justifications with an estimated value of more than $50 million.

Subpart 806.5—Competition Advocates

Requirement.

(a) The Associate Deputy Assistant Secretary for Acquisitions is the Agency Competition Advocate. The Agency Competition Advocate may further delegate authority to other VA officials in VA Administrations and staff offices.

(b) The Executive Director and Chief Operating Officer, National Acquisition Center, is the Contracting Activity Competition Advocate for the Center.

(c) Each HCA (see Subpart 802.1) will serve as the Contracting Activity Competition Advocate in all other cases.

(d) The authority in paragraphs (b) and (c) of this section is not delegable.

Planning requirements.

(a) Each Contracting Activity Competition Advocate must do the following:

(1) Develop a Competition Plan.

(2) Incorporate the Plan in the internal operating procedures of the facility or organization in which the contracting activity is located.

(3) Obtain the endorsement and support of top level management.

(4) Ensure that the services and offices that the contracting activity supports understand the plan.

(b) At a minimum, the Competition Plan must include the following:

(1) Approval requirements for other than full and open competition specified in FAR 6.304.

(2) A description of the synopsis requirements in FAR Subpart 5.2 to ensure that responsible staff fully understand the advance procurement planning that is required.

(3) A description of how to integrate the Competition Plan into advance procurement planning.

(4) A listing of obstacles to competition and a proposal for overcoming them.

(5) A method for increasing cost competition for contracts and competition on other significant factors.

End Part Start Part

PART 807—ACQUISITION PLANNING

Subpart 807.1—Acquisition Plans
807.103
Agency-head responsibilities.
Subpart 807.3—Contractor Versus Government Performance
807.300
Scope of subpart.
807.304-77
Right of first refusal.
Start Authority

Authority: 40 U.S.C. 121(c) and 48 CFR 1.301-1.304.

End Authority

Subpart 807.1—Acquisition Plans

Agency-head responsibilities.

The authority to prescribe procedures in FAR 7.103 is delegated to the SPE and is further delegated to the DSPE.

Subpart 807.3—Contractor Versus Government Performance

Scope of subpart.

This subpart prescribes the use of VAAR clause at 852.207-70, Report of Employment Under Commercial Activities, when contracting for commercial services under Office of Management and Budget (OMB) Circular A-76 or VA's cost comparison process. The cost comparison process is used by VA to determine whether to use commercial or Government resources to provide commercial services.

Right of first refusal.

(a) In addition to the Right of First Refusal of Employment clause specified in FAR 52.207-3, the contracting officer must include the clause “Report of Employment Under Commercial Activities” at 852.207-70 in all cost comparison solicitations where VA personnel may be displaced. This clause is primarily intended to verify that the contractor is meeting its obligation to provide Federal workers who are adversely affected by the contract award and who are qualified for the jobs the first opportunity for employment openings created by the contract.

(b) The Report of Employment Under Commercial Activities clause is also prescribed to avoid inappropriate severance payment. To implement the clause, the contracting officer (or COTR) must first obtain a list of Federal personnel who will be adversely affected as a result of the anticipated contract from the servicing Human Resources Service office. The list should be requested as soon as a preliminary determination is made to contract out a function subject to OMB Circular A-76. (Contracting officers may designate a COTR to coordinate the information and reporting requirements.)

End Part Start Part

PART 808—REQUIRED SOURCES OF SUPPLIES AND SERVICES

808.002
Priorities for use of Government supply sources.
Subpart 808.4—Federal Supply Schedules
808.402
General.
Subpart 808.8—Acquisition of Printing and Related Supplies
808.802
Policy.
Start Authority

Authority: 40 U.S.C. 121(c) and (d); and 48 CFR 1.301-1.304.

End Authority
Priorities for use of Government supply sources.

(a) Supplies. (1) As used in FAR 8.002(a)(1)(i), the term “agency inventories” includes Supply Fund Stock and VA Excess.

(2) A national committed use contract awarded by the VA National Acquisition Center has a priority between wholesale supply sources (FAR 8.002(a)(1)(v)) and mandatory Federal Supply Schedules (FAR 8.002(a)(1)(vi)).

(3) Federal Supply Schedule contracts awarded by the VA National Acquisition Center in Federal Supply Classification (FSC) Groups 65 and 66 shall be mandatory for use by VA and shall have the same order of priority as mandatory Federal Supply Schedules Start Printed Page 2366(FAR 8.002(a)(1)(vi)). VA contracting officers must place orders against Federal Supply Schedules contracts awarded by the VA National Acquisition Center in FSC Groups 65 and 66 in the following descending order of priority:

(i) Nationally awarded Blanket Purchase Agreements (BPAs), issued by the VA National Acquisition Center against Federal Supply Schedules.

(ii) Multi-VISN, single-VISN, or locally awarded BPAs, issued by VISN, regional, or local VA contracting officers against Federal Supply Schedules.

(iii) Federal Supply Schedules without BPAs.

(4) Indefinite delivery indefinite quantity (IDIQ) contracts, awarded by VISN, regional, or local facility VA contracting officers, for supplies not covered by national committed use contracts or Federal Supply Schedule contracts shall have an order of priority between optional use Federal Supply Schedules (FAR 8.002(1)(a)(vii)) and commercial sources (including educational and nonprofit institutions) (FAR 8.002(1)(a)(viii)). VA contracting officers must place delivery orders against IDIQ contracts, awarded by VISN, regional, or a local facility contracting officers, for supplies not covered by national committed use contracts or Federal Supply Schedule contracts in the following descending order of priority:

(i) VISN or regionally awarded contracts.

(ii) Locally awarded contracts.

(5) Open market purchases (purchases not falling within any of the higher priorities in paragraphs (a)(2) through (4) of this section) have the same priority as commercial sources (including educational and nonprofit institutions) (FAR 8.002(1)(a)(viii)).

(b) Unusual or compelling urgency. The contracting officer may use a source lower in priority than as specified in paragraph (a) when the need for supplies or services is of an unusual or compelling urgency (see FAR 6.302-2). The Contracting Officer must include a justification for each deviation in the procurement file.

(c) Eligible Beneficiaries. (1) A contracting 0fficer may authorize an acquisition from the Veterans Canteen Service or a commercial source when a VA healthcare official (e.g., social worker, physician) determines that personal selection of shoes, clothing, and incidentals will result in a therapeutic benefit to an eligible beneficiary.

(2) The contracting officer must cite Federal Prison Industries, Inc., clearance No. 1206 in the purchase document for any purchase from a commercial source of dress shoes similar to Federal Prison Industries, Inc., Style No. 86-A.

Subpart 808.4—Federal Supply Schedules

General.

The Executive Director and Chief Operating Officer, VA National Acquisition Center, advertises, negotiates, awards, administers, and issues the Federal Supply Schedules for Federal Supply Classification Groups 65 and 89 and for cost-per-test services under Group 66.

Subpart 808.8—Acquisition of Printing and Related Supplies

Policy.

The Director, Publications Staff, Office of Acquisition and Materiel Management, VA Central Office, is the Central Printing Authority for VA (see FAR 8.802(b)).

End Part Start Part

PART 809—CONTRACTOR QUALIFICATIONS

Subpart 809.1—Responsible Prospective Contractors
809.104
Standards.
809.104-2
Special standards.
809.106
Preaward surveys.
809.106-1
Conditions for preaward surveys.
Subpart 809.2—Qualifications Requirements
809.201 Definitions.
809.202
Policy.
809.204
Responsibilities for establishment of a qualification requirement.
809.206
Acquisitions subject to qualification requirements.
809.206-1
General.
809.270
Qualified products for convenience/labor-saving foods.
Subpart 809.4—Debarment, Suspension, and Ineligibility
809.400
Scope of subpart.
809.402
Policy.
809.404
Excluded Parties List System.
809.405
Effect of listing.
809.405-1
Continuation of current contracts.
809.405-2
Restrictions on subcontracting.
809.406
Debarment.
809.406-1
General.
809.406.3
Procedures.
809.406-4
Period of debarment.
809.407
Suspension.
809.407-1
General.
809.407-3
Procedures.
809.470
Fact-finding procedures.
Subpart 809.5—Organizational and Consultant Conflicts of Interest
809.503
Waiver.
809.504
Contracting officer responsibilities.
809.507
Solicitation provisions and contract clause.
809.507-1
Solicitation provisions.
Start Authority

Authority: 40 U.S.C. 121(c) and 48 CFR 1.301-1.304.

End Authority

Subpart 809.1—Responsible Prospective Contractors

Standards.
Special standards.

(a) For a pre-award survey prescribed by 809.106-1, a contracting officer must develop special standards of sanitation applicable to the acquisition of subsistence and services prescribed by 809.106-1(a).

(b) An appropriate specialist will assist the contracting officer in developing the special standards under paragraph (a) of this section.

Pre-award surveys.
Conditions for pre-award surveys.

(a) Except as provided in paragraphs (b) through (e) of this section, a committee under the direction of the contracting officer and composed of representatives of the medical service or using service chiefs or designees appointed by the facility or VISN director will conduct a pre-award on-site evaluation of the plant, personnel, equipment and processes of the prospective contractor for contracts covering the products and services of the following:

(1) Bakeries.

(2) Dairies.

(3) Ice cream plants.

(4) Laundry and dry cleaning activities.

(b) Before any inspection, the contracting officer will determine whether another VA facility or another Federal agency has recently inspected and approved the plant.

(1) The contracting officer will accept an approved inspection report of another VA facility.

(2) If another Federal agency made a plant inspection not more than 6 months before the proposed VA contract period, the contracting officer may accept an approved inspection report of that other Federal agency as satisfactory evidence that the facilities of the bidder meet the bid requirements.

(c) VA will not conduct a pre-award on-site evaluation of a dairy plant when VA receives an acceptable bid from a supplier of dairy products designated as No.1 in the Federal Specifications if the following conditions are met:

(1) The supplier has received a pasteurized milk rating of 90 percent or more for the type of product being supplied, on the basis of the U.S. Public Health Service milk ordinance and code. Start Printed Page 2367

(2) The rating is current (not over 2 years old) and has been determined by a certified State milk sanitation rating officer in the State of origin or by the Public Health Service. The contractor must maintain the rating of 90 percent or more during the period of the contract.

(3) The solicitation specifications must include the requirements in paragraphs (c)(1) and (2) of this section.

(d) A dairy plant that does not meet paragraph (c) of this section may offer only dairy products designated as No. 2 in the Federal Specifications. VA will make an award to such a firm only after it completes a pre-award on-site evaluation conducted under paragraph (a) of this section.

(e) Before it makes an open market purchase of fresh bakery products (such as pies, cakes, and cookies), VA will inspect and evaluate the plant where these products are produced or prepared under paragraph (a) of this section. VA will make an on-site evaluation at least annually and record the results on VA Form 10-2079, Inspection Report of Bakery.

Subpart 809.2—Qualifications Requirements

Definitions.

For the purposes of this subpart:

VA QPL means a VA Qualified Products List, a list of products qualified by the VA under VA specifications, or purchase descriptions, or commercial item descriptions.

VISN QPL means a VISN Qualified Products List, a list of products qualified by a VISN under VA specifications, or purchase descriptions, or commercial item descriptions.

Policy.

The HCA may sign a justification required by FAR 9.202(a)(1).

Responsibilities for establishment of a qualification requirement.

(a) Under FAR Subpart 9.2, VA may create VA QPLs for use on individual solicitations or on multiple solicitations issued by one or more VA facilities.

(b) An HCA or designee must support the creation of a VA QPL using one or more of the following justifications:

(1) The time required for testing the product after award would unduly delay product delivery.

(2) The cost of repetitive product testing would be excessive.

(3) Testing the product would require purchasing an expensive or complicated apparatus not commonly available.

(4) It is in the Government's interest to be assured before contract award that the product is satisfactory for its intended use.

(5) Determining acceptability would require providing product performance data to supplement technical requirements in the specification.

(6) Conducting a test would result in substantial or repetitive rejections.

(7) VA cannot economically develop clear, professional specifications for the product performance, balance, design, or construction, and professional judgment is required to determine whether the product is acceptable under VA requirements.

(c) If VA plans to establish a VA QPL for any given product, the contracting officer may limit known suppliers to suppliers whose products are covered by a Federal Supply Schedule contract, as provided at FAR Subpart 8.4.

(d) VA will pay the costs to inspect and test a product sample submitted under this section.

(1) The product supplier must pay for the sample and its transportation to the place of inspecting and testing.

(2) After inspection and testing, VA will return any product sample to the supplier “as is” unless:

(i) The inspection or test destroys the sample; or

(ii) The supplier authorizes VA to retain or dispose of the sample.

(e) Once VA accepts a product for the VA QPL, VA may review the product for compliance with the applicable specification at any time.

(1) Where there is a variance between a VA specification that was the basis for the VA QPL and the product furnished by the supplier, the supplier must furnish an item that conforms to the VA specification.

(2) If the supplier fails to or is unable to provide a product that conforms to the applicable VA specification, the product will be removed from the VA QPL.

(f) VA's acceptance of a product for listing on the VA QPL does not:

(1) Guarantee that VA will accept the product in any future purchase; or

(2) Constitute a waiver of the specifications as to acceptance, inspection, testing, or other provisions of any future contract involving the product.

Acquisitions subject to qualification requirements.
General.

The HCA may determine that an emergency exists, as provided in FAR 9.206-1(b).

Qualified products for convenience/labor-saving foods.

(a) Each VISN Nutrition and Food Service representative is authorized to establish a common VISN QPL for convenience and labor-saving foods for use at medical facilities within the representative's VISN.

(1) The VISN Nutrition and Food Service representative must notify the Director, Nutrition and Food Service, VA Central Office, of the establishment or amendment of any VISN QPL.

(2) To avoid unnecessary duplication within a VISN, for medical facilities using an applicable VISN QPL under paragraph (b) of this section, the VISN Nutrition and Food Service representative must coordinate and consolidate test results and recommendations.

(b) Each medical facility may:

(1) Use its VISN QPL; and

(2) Test food of its choice, provided that the facility submits test results to the VISN Nutrition and Food Service representative.

(c) The VISN representative must provide a copy of each approved VISN QPL to the following:

(1) Each contracting office in the VISN.

(2) The Director, Nutrition and Food Service, VA Central office.

(3) Upon request, the Office of Acquisition and Materiel Management, VA Central Office.

Subpart 809.4—Debarment, Suspension, and Ineligibility

Scope of subpart.

This subpart supplements provisions of the FAR concerning procedures and related actions for the debarment and suspension of contractors.

Policy.

(a) When VA receives information that another agency is pursuing a debarment or suspension identical to a VA action against the same contractor, the Debarment and Suspension (D & S) Committee will coordinate prospective action with the appropriate official of the other agency to establish a lead agency.

(b) The D&S Committee will provide the designated lead agency with any information relevant to the action for consideration in the decision-making process.

(c) The D&S Committee will maintain close coordination with the appropriate official through the completion a final debarment or suspension decision.

Excluded Parties List System.

Acquisition Resources Service, Office of Acquisition and Materiel Management, is responsible for the actions described in FAR 9.404(c).

Start Printed Page 2368
Effect of listing.

The authority under FAR 9.405(a), 9.405(d)(2), and 9.405(d)(3) to determine whether to solicit from, evaluate bids or proposals from, or award contracts to contractors whose names appear on the Excluded Parties List System is delegated to the SPE and is further delegated to the DSPE.

Continuation of current contracts.

Authority to make the determinations under FAR 9.405-1 is delegated to the SPE and is further delegated to the DSPE.

Restrictions on subcontracting.

When a subcontract is subject to Government consent, authority to make the written determination required under FAR 9.405-2 consenting to a contractor's use of a subcontractor who is debarred, suspended, or proposed for debarment is delegated to the SPE and is further delegated to the DSPE.

Debarment.
General.

(a) As provided in FAR 9.406-1(c), authority to determine whether to continue business dealings between VA and a contractor debarred or proposed for debarment is delegated to the SPE and is further delegated to the DSPE.

(b) For the purposes of FAR 9.406-1, the DSPE is the debarring official under the Federal Management Regulation at 41 CFR 102-117.295.

(c) Additional factors that a debarring official should consider before arriving at a debarment decision include the following:

(1) Whether the contractor had a mechanism, such as a hotline, by which employees could have reported suspected instances of improper conduct, and instructions in place that encouraged employees to make such reports.

(2) Whether the contractor conducted periodic reviews of company business practices, procedures, policies, and internal controls for compliance with standards of conduct and the special requirements of Government contracting.

(3) Whether the contractor conducted internal and external audits as appropriate.

(4) Whether the contractor timely reported to appropriate Government officials any suspected or possible violations of law in connection with Government contracts or any other irregularities in connection with such contracts.

Procedures.

(a) Any individual may submit a recommendation to debar a contractor to the DSPE. The recommendation to debar must be supported with evidence of a cause for debarment listed in FAR 9.406-2. When the DSPE receives a recommendation for debarment, he or she will refer the matter to the D & S Committee. If the reporting individual is a VA employee and the recommendation to debar is based on possible criminal or fraudulent activities, the VA employee must report the circumstances to the VA Office of Inspector General before making a recommendation to the DSPE.

(b) When the D & S Committee finds evidence of a cause for debarment, as listed in FAR 9.406-2, with or without a recommendation, it will conduct a fact-finding and present facts to the debarring official.

(c) If the debarring official finds a basis for proposing a contractor for debarment, the D & S Committee will prepare a notice of proposed debarment under FAR 9.406-3(c) for the signature of the debarring official. The signed notice of proposed debarment will be sent to the last known address of the contractor, the contractor's counsel, or agent for service of process, by certified mail, return receipt requested. In the case of a business, the D & S Committee may send the notice of proposed debarment to any partner, principal, officer, director, owner or co-owner, or joint venture. The D & S Committee concurrently must post notice of proposed debarment to the General Services Administration Excluded Parties List System pending a debarment decision.

(d) If VA does not receive a reply from the contractor within 45 calendar days of sending the notice of proposed debarment, the D & S Committee will prepare a recommendation and refer the case to the debarring official for a decision on whether or not to debar based on the information available.

(e) If VA receives a reply from the contractor within 45 calendar days of sending the notice of proposed debarment, the D & S Committee must consider the information in the reply before the D & S Committee makes its recommendation to the debarring official.

(f) The D & S Committee, upon the request of the contractor proposed for debarment, must, as soon as practicable, allow the contractor an opportunity to appear before the D & S Committee to present information or argument in person or through a representative. The contractor may supplement the oral presentation with written information and argument. The proceeding will be conducted in an informal manner and without requirement for a transcript. The D & S Committee shall prepare a report of the proceeding for the debarring official.

(g) If the D & S Committee finds that the contractor's submission in opposition to the debarment raises a genuine dispute over facts material to the proposed debarment and the debarment action is not based on a conviction or civil judgment, then the D & S Committee shall submit to the debarring official the information establishing the dispute of material facts. If the debarring official agrees that there is a genuine dispute of material facts, the debarring official shall refer the dispute to the VA Board of Contract Appeals for resolution pursuant to 809.470.

(h) If there are no disputes over material facts, the debarment action is based on a conviction or civil judgment, or all disputes over material facts have been resolved pursuant to 809.470, the debarring official will make a decision on the basis of all information available, including findings of facts and oral or written arguments presented or submitted to the D & S Committee by the contractor. The D & S Committee must update the status of the action on the General Services Administration Excluded Parties List System.

Period of debarment.

(a) Except in an unusual circumstance, the period of debarment will not exceed three years. The debarring official will base the period of debarment on the circumstances surrounding the cause for debarment.

(b) The DSPE may remove a debarment, amend its scope, or reduce the period of debarment based on a D & S Committee recommendation if:

(1) VA has debarred the contractor;

(2) The action is indicated after the DSPE reviews documentary evidence submitted by or on behalf of the contractor setting forth the appropriate grounds for granting relief. Appropriate grounds include newly discovered material evidence, reversal of a conviction, bona fide change of ownership or management, elimination of the cause for which debarment was imposed, or any other appropriate grounds.

Suspension.
General.

(a) As provided in FAR 9.407-1(d), authority to determine whether to continue business dealings between VA and a suspended contractor is delegated Start Printed Page 2369to the SPE and is further delegated to the DSPE.

(b) For the purposes of FAR 9.407-1, the DSPE is the suspending official under the Federal Management Regulation at 41 CFR 102-117.295.

Procedures.

(a) Any individual may submit a recommendation to suspend a contractor to the DSPE. The recommendation to suspend must be supported with evidence of a cause for suspension listed in FAR 9.407-2. When the DSPE receives a recommendation for suspension, he or she will refer the matter to the D&S Committee. If the reporting individual is a VA employee and the recommendation to suspend is based on possible criminal or fraudulent activities, the VA employee must report the circumstances to the VA Office of Inspector General before making a recommendation to the DSPE.

(b) When the D&S Committee finds evidence of a cause for suspension, as listed in FAR 9.407-2, with or without a recommendation, it will conduct a fact-finding and present facts and recommendations to the suspending official.

(c) If the suspending official finds a basis for suspending a contractor, the D&S Committee will prepare a notice of suspension under FAR 9.407-3(c) for the signature of the suspending official. The signed notice of suspension will be sent to the last know address of the contractor, the contractor's counsel, or agent for service of process, by certified mail, return receipt requested. In the case of a business, the D&S Committee may send the notice of suspension to any partner, principal, officer, director, owner or co-owner, or joint venture. The D&S Committee concurrently must post notice of suspension to the General Services Administration Excluded Parties List System pending completion of investigation and any ensuing legal proceedings.

(d) If VA receives a reply from the contractor within 45 calendar days of sending the notice of suspension, the D&S Committee must consider the information in the reply before the Committee makes further recommendations to the suspending official. The D&S Committee, upon the request of a suspended contractor, must, as soon as practicable, allow the contractor an opportunity to appear before the D&S Committee to present information or argument in person or through a representative. The contractor may supplement the oral presentation with written information and argument. The proceeding will be conducted in an informal manner and without requirement for a transcript. The D&S Committee shall prepare a report of the proceeding for the suspending official.

(e) In actions not based on an indictment, if the D&S Committee finds that the contractor's submission in opposition to the suspension raises a genuine dispute over facts material to the suspension, the D&S Committee shall submit to the suspending official the information establishing the dispute of material facts. However, the D&S Committee must first coordinate any further proceeding regarding the facts in dispute with the Department of Justice or with a State prosecuting authority in a case involving a State jurisdiction. VA will take no further action to determine disputed material facts pursuant to this section or 809.470 if the Department of Justice or a State prosecuting authority advises VA that additional proceedings to make such a determination would prejudice Federal or State legal proceedings.

(f) If the suspending official agrees that there is a genuine dispute of material facts, the suspending official shall refer the dispute to the VA Board of Contract Appeals for resolution pursuant to 809.470.

Fact-finding procedures.

The provisions of this section constitute the procedures to be used to resolve genuine disputes of fact pursuant to 809.406-3 and 809.407-3 of this chapter. The Chair of the VA Board of Contract Appeals shall appoint a member of the Board to conduct the fact-finding. OGC shall represent VA at any fact-finding hearing and may present witnesses for VA and question any witnesses presented by the contractor. The hearings shall be conducted in Washington, DC, unless the appointed member of the VA Board of Contract Appeals determines otherwise. The proceedings before the fact-finder will be limited to a finding of the facts in dispute, as determined by the debarring or suspending official. The fact-finder will establish the date for the fact-finding hearing, normally to be held within 45 working days of the submission of the dispute to the Board.

(a) The Government's representative and the contractor will have an opportunity to present evidence relevant to the facts at issue. The contractor may appear in person or through a representative at the fact-finding hearing. The contractor may submit documentary evidence, present witnesses, and confront any person the agency presents.

(b) Witnesses may testify in person. Witnesses will be reminded of the official nature of the proceedings and that any false testimony given is subject to criminal prosecution. Witnesses are subject to cross-examination. Hearsay evidence may be presented and will be given appropriate weight by the fact-finder.

(c) The proceedings shall be transcribed and a copy of the transcript shall be made available at cost to the contractor upon request, unless the contractor and the fact-finder, by mutual agreement, waive the requirement for a transcript.

(d) The fact-finder shall determine the disputed fact(s) by a preponderance of the evidence. As required by FAR 9.406-3(d)(2)(i) and 9.407-3(d)(2)(i), written findings of fact shall be prepared by the fact-finder. A copy of the findings of fact shall be provided to the debarring or suspending official, the Government's representative, and the contractor.

Subpart 809.5—Organizational and Consultant Conflicts of Interest

Waiver.

The HCA is delegated authority to waive any general rule or procedure of FAR Subpart 9.5. As provided at FAR 9.503, this authority may not be redelegated.

Contracting officer responsibilities.

(a) A contracting officer must determine whether awarding a contract will result in an actual or potential conflict of interest for the contractor.

(1) The contracting officer will make a conflict of interest determination after reviewing information submitted by offerors, evaluating information gathered under FAR 9.506, and exercising his or her own judgment.

(2) In evaluating possible organization conflicts of interest, the contracting officer may obtain the advice of legal counsel and the assistance of technical specialists.

(b) If the contracting officer determines that there is no way to avoid or mitigate an organizational conflict of interest arising from a contract award, the contracting officer may disqualify the offeror from award under FAR 9.504(e).

(c) Even if awarding a contract will result in an organizational conflict of interest, the contracting officer may request a waiver from his or her HCA if awarding the contract is in the best interests of the Government.

(1) Before granting a waiver request under this paragraph, the HCA must obtain the concurrence of OGC.

(2) If the HCA grants a waiver request, the contracting officer may set contract Start Printed Page 2370terms and conditions to reduce any organizational conflict of interest to the greatest extent possible.

(d) In any solicitation for the services addressed at FAR 9.502, the contracting officer must require that each offeror submits a statement with its offer disclosing all facts relevant to an existing or potential organizational conflict of interest involving the contractor or any subcontractor during the life of the contract (see 809.507-1(b) and 852.209-70).

Solicitation provisions and contract clause.
Solicitation provisions.

(a) While conflicts of interest may not presently exist, award of certain types of contracts may create potential future organizational conflicts of interest (see FAR 9.508 for examples). If a solicitation may create a potential future organizational conflict of interest, the contracting officer must insert a provision in the solicitation imposing an appropriate restraint on the contractor's eligibility for award of contracts in the future. Under FAR 9.507-1, the restraint must be appropriate to the nature of the conflict and may exclude the contractor from award of one or more contracts in the future.

(b) The clause at 852.209-70, Organizational Conflicts of Interest, must be included in any solicitation for the services addressed in FAR 9.502.

End Part Start Part

PART 811—DESCRIBING AGENCY NEEDS

811.001
Definitions.
Subpart 811.1—Selecting and Developing Requirements Documents
811.103
Market acceptance.
811.103-70
Technical industry standards.
811.104
Use of brand name or equal purchase descriptions.
811.104-70
Brand name or equal purchase descriptions.
811.104-71
Purchase description clauses.
811.104-72
Brand name or equal component parts.
811.104-73
Bid samples.
811.104-74
Bid evaluation and award.
811.104-75
Procedure for negotiated procurements.
811.105
Items peculiar to one manufacturer.
811.107
Contract clauses.
Subpart 811.2—Using and Maintaining Requirements Documents
811.202
Maintenance of standardization documents.
811.204
Contract clause.
Subpart 811.4—Delivery or Performance Schedules
811.404
Contract clause.
Subpart 811.5—Liquidated Damages
811.501
Policy.
811.503
Contract clause.
Subpart 811.6—Priorities and Allocations
811.602
General.
Start Authority

Authority: 40 U.S.C. 121(c) and 48 CFR 1.301-1.304.

End Authority
Definitions.

For the purposes of this part:

Brand name product means a commercial product described by brand name and make or model number or other appropriate nomenclature by which the product is offered for sale to the public by the particular manufacturer, producer or distributor.

Salient characteristics means those particular characteristics that specifically describe the essential physical and functional features of the material or service required. They are features that are identified in the specifications as a mandatory requirement that a proposed “equal” product or material must possess for the bid to be considered responsive.

Subpart 811.1—Selecting and Developing Requirements Documents

Market acceptance.
Technical industry standards.

Where items are required to conform to technical industry standards, such as those adopted by: Underwriters Laboratories, Inc.; Factory Mutual Laboratories; American Gas Association; American Society of Mechanical Engineers; National Electrical Manufacturers Association; American Society of Heating, Refrigerating and Air-Conditioning Engineers; or similar organizations, where such standards are generally recognized and accepted in the industry involved, the invitation for bids, request for proposals or request for quotations will so state. In no instance, where there is a multiple choice of laboratories, shall the invitation for bid, request for proposal, or request for quotation indicate that the label or certificate of only one such laboratory is acceptable. The contracting officer shall include the provision at 852.211-72, Technical Industry Standards, in solicitations requiring conformance to technical industry standards unless comparable provisions are contained in the item specification.

Use of brand name or equal purchase descriptions.
Brand name or equal purchase descriptions.

(a) The specification writer may use purchase descriptions that contain references to one or more brand name products only in accordance with 811.104-71 through 811.104-75.

(b) Purchase descriptions that contain references to one or more brand name products must be followed by the words “or equal,” except when the acquisition of a specific brand name is fully justified under FAR Subpart 6.3 and 806.3. If more than one brand name is acceptable, the contracting officer should list the known acceptable brand name products in the solicitation.

(c) Where a “brand name or equal” purchase description is used, the contracting officer must give bidders an opportunity to offer products other than those specifically referenced by brand name. Following bid opening or receipt of offers, the contracting officer must determine if non “brand name” substitute products fully meet the salient characteristics listed in the solicitation.

(d) When using a “brand name or equal” purchase description, the specification writer must set forth those salient physical, functional, or other characteristics of the referenced products that are essential to the minimum needs of the Government. For example, when interchangeability of parts is required, the specification writer must specify this requirement. The purchase description must contain the following information to the extent available:

(1) Complete common generic identification of the item required.

(2) Applicable model, make, or catalog number for each brand name product referenced and identity of the commercial catalog in which it appears.

(3) Name of manufacturer, producer, or distributor of each brand name product referenced (and address if not well known).

(4) Any other information necessary to describe the item required.

(e) When necessary to adequately describe the item required, the contracting officer may use an applicable commercial catalog description or pertinent extract if the description is identified in the solicitation as being that of the particular named manufacturer, producer, or distributor. The contracting officer must insure that a copy of any catalog referenced (except a parts catalog) is available on request for review by bidders at the purchasing office.

(f) Except as noted in paragraph (d) of this section, the specification writer must not include in a purchase description either minimum or maximum restrictive dimensions, weights, materials, or other salient characteristics that are unique to a Start Printed Page 2371brand name product or that would tend to eliminate competition or other products that are only marginally outside the restrictions. However, the specification writer may include in a purchase description restrictive dimensions, weights, materials, or other salient characteristic if:

(1) The user determines in writing that the restrictions are essential to the Government's requirements;

(2) The specification writer includes the brand name of the product in the purchase description; and,

(3) The contracting officer makes all other determinations required by 811.105.

(g) The contracting officer must include in the contract file, as appropriate, written justifications for using the “brand name or equal” description, the contracting officer's determinations, and bidder submissions.

Purchase description clauses.

(a) When a solicitation uses “brand name or equal” purchase descriptions, the contracting officer must include in the solicitation the clause at 852.211-73, Brand Name or Equal, and the provision set forth at FAR 52.214-21, Descriptive Literature. The contracting officer must review the requirements at FAR 14.202-5 when using the descriptive literature provision.

(b) When a “brand name or equal” purchase description is included in an invitation for bids, the contracting officer must insert the following after each item so described in the solicitation, for completion by the bidder:

Bidding on:

Manufacturer name

Brand

No.

Limited application of brand name or equal.

If the contracting officer determines that the clause at 852.211-73, Brand Name or Equal, applies to only certain line items of a solicitation, the requirements of 811.104-71(b) apply to those line items and the contracting officer must include a statement in the solicitation as follows:

The clause entitled “Brand Name or Equal” applies only to the following line items: [List the line items to which the clause applies]

Bid samples.

(a) When a solicitation contains “brand name or equal” purchase descriptions, the contracting officer must not require a bidder who offers brand name products, including component parts, referenced in the descriptions to furnish bid samples of the referenced brand name products.

(b) A solicitation may require the submission of bid samples in the case of a bidder offering “or equal” products. If bid samples are required, the contracting officer must include in the solicitation the provision set forth at FAR 52.214-20, Bid Samples.

(c) A bidder must furnish all descriptive literature in accordance with and for the purpose set forth in the “Brand Name or Equal” clause, 852.211-73(c)(1) and (c)(2), even though bid samples may not be required.

Bid evaluation and award.

(a) A bid offering products that differ from brand name products referenced in a “brand name or equal” purchase description must be considered for award if the contracting officer determines in accordance with the terms of the clause at 852.211-73, Brand Name or Equal, that the offered products are clearly identified in the bid and are equal in all material respects to the products specified.

(b) In award documents, the contracting officer must include, or incorporate by reference, an identification of the specific products that the contractor is to furnish. The identification must include any brand name and make or model number, descriptive material, and any modifications of brand name products specified in the bid. This requirement also applies when the descriptions of the end items contain “brand name or equal” purchase descriptions of component parts or of accessories related to the end item, and the clause at 852.211-73, Brand Name or Equal, was applied to the component parts or accessories (see 811.104-72).

Procedure for negotiated procurements.

(a) The specification writer and contracting officer must use the policies and procedures prescribed in 811.104-70 through 811.104-74 as a guide in developing adequate purchase descriptions for negotiated procurements.

(b) The contracting officer may adapt the clause at 852.211-73, Brand Name or Equal, for use in negotiated procurements. When use of the clause is not practical (as may be the case in unusual and compelling urgency purchases), the contracting officer must inform suppliers that proposals offering products different from the products referenced by brand name will be considered if the contracting officer determines that the offered products are equal in all material respects to the products referenced. The contracting officer must place decisions under this paragraph in writing for the contract file, as appropriate.

Items peculiar to one manufacturer.

(a) Except as provided in paragraph (b) of this section, the specification writer must write specifications in accordance with FAR 11.002.

(b)(1) When the specification writer determines that a particular physical or functional characteristic of only one product will meet the minimum requirements of VA (see FAR 11.105) or that a “brand name or equal” purchase description must be used (see FAR 11.104), the specification writer must identify the item(s) for the contracting officer and do one of the following:

(i) Provide a full written justification of the reason the particular characteristic is essential to the Government's requirements.

(ii) Explain why the “brand name or equal” purchase description is necessary.

(2) The contracting officer makes the final determination whether restrictive specifications or “brand name or equal” purchase descriptions will be included in the solicitation.

Contract clauses.

(a) Insert the clause at 852.211-70, Service Data Manuals, paragraph (a), in solicitations and requests for proposals for technical medical and other technical equipment and devices issued by a field facility unless the facility Chief, Engineering Service, indicates that the service data manuals are not needed. The purpose of the clause is to require the manufacturer to provide VA a manual or groups of manuals that will allow for the in-house repair of the equipment purchased.

(b) Insert the clause at 852.211-70, Service Data Manuals, paragraph (b), in solicitations and requests for proposals for mechanical equipment (other than technical medical and other technical equipment and devices) issued by a field station.

Subpart 811.2—Using and Maintaining Requirements Documents

Maintenance of standardization documents.

(a) Military and departmental specifications. Contracting officers may, when it is advantageous to VA, use these specifications when procuring supplies and equipment costing less than the simplified acquisition threshold. When purchasing items of perishable subsistence, contracting officers may take into account only Start Printed Page 2372those exemptions set forth in paragraphs (b)(2) and (b)(3) of this section.

(b) Nutrition and Food Service specifications. (1) VA has adopted for use in the procurement of packinghouse products the purchase descriptions and specifications set forth in the Institutional Meat Purchase Specifications (IMPS) and the IMPS General Requirements, which have been developed by the U.S. Department of Agriculture. Purchase descriptions and specifications for dairy products, poultry, eggs, fresh and frozen fruits and vegetables, as well as certain packinghouse products selected from the IMPS especially for VA use, are contained in Part IV of the Federal Supply Catalog, Stock List, FSC Group 89, Subsistence, Publication No. C8900-SL.

(2) The military specifications for meat and meat products contained in Part IV of the Federal Supply Catalog, Stock List, FSC Group 89, Subsistence, must be used by VA only when purchasing such items of subsistence from the Defense Logistics Agency (DLA). Military specifications for poultry, eggs, and egg products contained in Part IV of the Federal Supply Catalog, Stock List, FSC Group 89, Subsistence, may be used when purchasing either from DLA or from local dealers.

(3) Except as authorized in Part 846, a contracting officer must not deviate from the specifications contained in Part IV of the Federal Supply Catalog, Stock List, FSC Group 89, Subsistence, and the IMPS without prior approval from the DSPE.

(4) Items of meat, cured pork and poultry purchased under the Subsistence Prime Vendor national contract or other local procurement sources should be purchased via Commercial Item Descriptions (CID) that require all products meet USDA Grading standards and/or the IMPS as applicable.

(c) Department of Veterans Affairs specifications. (1) The Director, Publications Staff, is responsible for developing, publishing, and distributing VA specifications covering printing and binding.

(2) VA specifications, as they are revised, are placed in stock in the VA Forms and Publications Depot. The contracting officer may requisition facility requirements for these specifications from that source.

(d) Government paper specification standards. (1) Invitations for bids, requests for proposals, purchase orders, or other procurement instruments covering the purchase of paper stocks to be used in duplicating or printing, or which specify the paper stocks to be used in buying printing, binding, or duplicating, must require that the paper stocks be in accordance with the Government Paper Specification Standards issued by the Congressional Joint Committee on Printing.

(2) All binding or rebinding of books, magazines, pamphlets, newspapers, slip cases, and boxes must be procured in accordance with Government Printing Office (GPO) specifications and must be procured from the servicing GPO Regional Printing Procurement Office or, when appropriate, from commercial sources.

(3) There are three types of binding/rebinding: Class A (hard cover); Perfect (glued); and Lumbinding (sewn). The most suitable type of binding must be procured to satisfy the requirements, based upon the intended use of the bound material.

Contract clause.

Insert the clause at 852.211-75, Product Specifications, when product specifications are cited in an invitation for bids or a request for proposals.

Subpart 811.4—Delivery or Performance Schedules

Contract clause.

When delivery is required by or on a particular date for f.o.b. destination contracts, the contracting officer must add a statement following the Time of Delivery clause in FAR 52.211-8 that the delivery date specified is the date by which the shipment is to be delivered, not the shipping date. In f.o.b. origin contracts, the contracting officer must add a statement following this clause that the date specified is the date shipment is to be accepted by the carrier.

Subpart 811.5—Liquidated Damages

Policy.

The contracting officer must not routinely include a liquidated damages provision in supply or construction contracts, regardless of dollar amount. The decision to include liquidated damages provisions must conform to the criteria in FAR 11.501. In making this decision, the contracting officer must consider whether the necessity for timely delivery or performance as required in the contract schedule is so critical that a probable increase in contract price is justified. The contracting officer must not use a liquidated damages provision for any of the following reasons:

(a) As insurance against selection of a non-responsible bidder.

(b) As a substitute for efficient contract administration.

(c) As a penalty for failure to perform on time.

Contract clause.

When the contracting officer determines that the Liquidated Damages clause prescribed in FAR 52.211-11 or 52.211-12 must be used and where partial performance by the contractor may be to the advantage of the Government, the contracting officer must include the clause in 852.211-74, Liquidated Damages, in the contract.

Subpart 811.6—Priorities and Allocations

General.

(a) Priorities and allocations of critical materials are controlled by the Department of Commerce. Essentially, priorities and allocations of critical materials are restricted to projects having a direct connection with supporting current defense needs. VA is not authorized to assign a priority rating to its purchase orders or contracts involving the acquisition or use of critical materials.

(b) When it has been technically established that it is not feasible to use a substitute material, the Department of Commerce has agreed to assist the VA in obtaining critical materials for maintenance and repair projects. The Department of Commerce will also, when possible, render assistance in connection with the purchase of new items, which may be in short supply because of their use in connection with the defense effort.

(c) A contracting officer having problems acquiring critical materials must ascertain all the facts necessary to enable the Department of Commerce to render assistance to VA in acquiring these materials. The contracting officer must submit a request for assistance to the DSPE containing the following information:

(1) A description of the maintenance and repair project or the new item.

(2) The critical material and the amount required.

(3) The contractor's sources of supply, including any addresses. If the source is other than the manufacturer or producer, also list the name and address of the manufacturer or producer.

(4) The VA contract or purchase order number.

(5) The contractor's purchase order number, if known, and the delivery time requirement as stated in the solicitation or offer.

(6) The additional time the contractor claims is necessary to deliver the Start Printed Page 2373materials if priority assistance is not provided.

(7) The nature and extent of the emergency that will be generated at the station, such as any of the following:

(i) Damage to the physical plant.

(ii) Impairment of the patient care program.

(iii) Creation of safety hazards.

(iv) Any other pertinent condition that could result because of failure to secure assistance in obtaining the critical materials.

(8) If applicable, a statement that the item required is for use in a construction contract that was authorized by the Chief Facilities Management Officer, Office of Facilities Management, to be awarded and administered by the facility contracting officer.

End Part Start Part

PART 812—ACQUISITION OF COMMERCIAL ITEMS

Subpart 812.1—Acquisition of Commercial Items—General
812.102
Applicability.
Subpart 812.3—Solicitation Provisions and Contract Clauses for the Acquisition of Commercial Items
812.301
Solicitation provisions and contract clauses for the acquisition of commercial items.
812.302
Tailoring of provisions and clauses for the acquisition of commercial items.
Start Authority

Authority: 38 U.S.C. 501; 40 U.S.C. 121(c); and 48 CFR 1.301-1.304.

End Authority

Subpart 812.1—Acquisition of Commercial Items—General

Applicability.

(a) This part shall be used for the acquisition of supplies and services that meet the definition of commercial items at FAR 2.101.

(b) Contracting officers shall use the policies in this part in conjunction with the policies and procedures for the solicitation, evaluation, and award prescribed in Parts 813, Simplified Acquisition Procedures, 814, Sealed Bidding, and 815, Contracting by Negotiation, as appropriate for the particular acquisition.

(c) Contracts for the acquisition of commercial items are subject to the policies of other parts of this chapter. When a policy in another part of this chapter differs from a policy in this part, this Part 812 applies to the acquisition of commercial items.

Subpart 812.3—Solicitation Provisions and Contract Clauses for the Acquisition of Commercial Items

Solicitation provisions and contract clauses for the acquisition of commercial items.

(a) Regardless of provisions in other parts of the VAAR, contracting officers must use only those provisions and clauses in this part when acquiring commercial items.

(b) Contracting officers may use the provisions and clauses in the following VAAR sections, as appropriate, in requests for quotations, solicitations, and contracts:

(1) 852.203-70, Commercial advertising.

(2) 852.203-71, Display of Department of Veterans Affairs hotline poster.

(3) 852.207-70, Report of employment under commercial activities.

(4) 852.209-70, Organizational conflicts of interest.

(5) 852.211-71, Special notice.

(6) 852.211-72, Technical industry standards.

(7) 852.211-73, Brand name or equal.

(8) 852.211-75, Product specifications.

(9) 852.214-70, Caution to bidders—bid envelopes.

(10) 852.214-71, Restrictions on alternate item(s).

(11) 852.214-72, Alternate item(s).

(12) 852.214-73, Alternate packaging and packing.

(13) 852.214-74, Bid samples.

(14) 852.216-70, Estimated quantities.

(15) 852.228-71, Indemnification and insurance.

(16) 852.229-70, Sales and use taxes.

(17) 852.233-70, Protest Content/Alternative Disputes Resolution.

(18) 852.233-71, Alternate Protest Procedure.

(19) 852.237-7, Indemnification and Medical Liability Insurance.

(20) 852.237-70, Contractor responsibilities.

(21) 852.246-70, Guarantee.

(22) 852.246-71, Inspection.

(23) 852.246-72, Frozen processed foods.

(24) 852.252-70, Solicitation provisions or clauses incorporated by reference.

(25) 852.270-1, Representatives of contracting officers.

(26) 852.270-2, Bread and bakery products—quantities.

(27) 852.270-3, Purchase of shellfish.

(28) 852.271-72, Time spent by counselee in counseling process.

(29) 852.271-73, Use and publication of counseling results.

(30) 852.271-74, Inspection.

(31) 852.271-75, Extension of contract period.

(c) When appropriate, the contracting officer may use the clauses in the following VAAR sections in requests for quotations, solicitations, and contracts for the acquisition of commercial items if the contracting officer determines that the use is consistent with customary commercial practices:

(1) 852.211-70, Service data manuals.

(2) 852.211-74, Liquidated damages.

(d) All requests for quotations, solicitations, and contracts for commercial item services to be provided to beneficiaries must include by reference the clause at 852.271-70, Nondiscrimination in Services Provided to Beneficiaries.

(e) Micro-purchases that use the procedures of this part in conjunction with Part 813 do not require clauses unless the contracting officer determines that the use of clauses serves the Government's best interest.

(f) When soliciting for commercial services or the use of medical equipment or space under the authority of part 873 and 38 U.S.C. 8151-8153, the provisions and clauses in the following VAAR sections may be used in accordance with the prescriptions contained therein or elsewhere in the VAAR:

(1) 852.273-70, Late offers.

(2) 852.273-71, Alternative negotiation techniques.

(3) 852.273-72, Alternative evaluation.

(4) 852.273-73, Evaluation—health-care resources.

(5) 852.273-74, Award without exchanges.

(38 U.S.C. 8151-8153)

Tailoring of provisions and clauses for the acquisition of commercial items.

(a) Contracting officers may tailor solicitations to be inconsistent with customary commercial practice if they prepare and obtain approval of a waiver under paragraph (c) of this section.

(b) The contracting officer must prepare the waiver in accordance with FAR 12.302(c). The waiver is subject to the tailoring prohibitions in FAR 12.302(b)(1) through 12.302(b)(6).

(c) The contracting officer must obtain approval for waivers from the following:

(1) The Chief, Acquisition Assistance Division, for individual contracts.

(2) The Chief, Acquisition Program Management Division, for a class of contracts.

(d) Contracting officers must submit waiver requests no later than the solicitation issue date.

(e) Contracting officers must retain approved requests in the contract file.

End Part Start Printed Page 2374

SUBCHAPTER C—CONTRACTING METHODS AND CONTRACT TYPES

Start Part

PART 813—SIMPLIFIED ACQUISITION PROCEDURES

Subpart 813.1—Procedures
813.106
Soliciting competition, evaluation of quotations or offers, award and documentation.
813.106-3
Award and documentation.
813.106-70
Oral purchase orders.
Subpart 813.3—Simplified Acquisition Methods
813.302
Purchase orders.
813.302-5
Clauses.
813.307
Forms.
Start Authority

Authority: 40 U.S.C. 121(c) and 48 CFR 1.301-1.304.

End Authority

Subpart 813.1—Procedures

Soliciting competition, evaluation of quotations or offers, award and documentation.
Award and documentation.

The contracting officer may record a quotation on an Abstract of Offers (SF 1409 or 1419), the purchase request if space permits, or other supplemental sheet or form, such as VA Form 10-2237b, Request for Dietetic Supplies.

Oral purchase orders.

When advantageous to VA, the contracting officer may use an oral purchase order for transactions not in excess of $2,500. This limitation does not apply to delivery orders against existing contracts, e.g., delivery orders against Federal Supply Schedule contracts. The contracting officer must assign a purchase order number to the transaction. A copy of any electronically generated purchase order may be used as a property voucher and receiving report to document receipt.

Subpart 813.3—Simplified Acquisition Methods

Purchase orders.
Clauses.

When using the VA Form 90-2138 or 90-2138-ADP for maintenance contracts involving services performed on Government property that have the potential for property damage and liability claims, the contracting officer must insert in the purchase order the Contractor's Responsibilities clause found at 852.237-70. Applicable maintenance contracts include, but are not limited to, window washing, pest control, and elevator maintenance.

Forms.

(a) The following forms provide a purchase or delivery order, vendor's invoice, and receiving report:

(1) VA Form 90-2138, Order for Supplies or Services.

(2) VA Form 90-2139, Order for Supplies or Services (Continuation).

(3) VA Form 90-2138-ADP, Purchase Order for Supplies or Services.

(4) VA Form 2139-ADP, Order for Supplies and Services (Continuation).

(b) The contracting officer may use the forms specified in paragraphs (a)(1) through (a)(4) of this section instead of OF 347, Order for Supplies or Services, OF 348, Order for Supplies or Services Schedule—Continuation, and SF 1449, Solicitation/Contract/Order for Commercial Items.

(c) The contracting officer or other properly delegated official (see 801.670-3) may use the following order forms when ordering the indicated medical, dental, and ancillary services totaling up to $10,000 per authorization when such services are not available under existing contracts:

(1) VA Form 10-7078, Authorization and Invoice for Medical and Hospital Services.

(2) VA Form 10-7079, Request for Outpatient Medical Services.

(3) VA Form 10-2570d, Dental Record Authorization and Invoice for Outpatient Service.

(d) In authorizing patient travel as set forth in VA manual MP-1, Part II, Chapter 3, the contracting officer or other properly delegated official (see 801.670-3) may use VA Form 10-2511, Authority and Invoice for Travel by Ambulance or Other Hired Vehicle, as provided by that manual.

(e) The contracting officer must use SF 182, Request, Authorization, Agreement, and Certification of Training, for procurement of training.

(f) The contracting officer must use VA Form 10-2421, Prosthetics Authorization for Items or Services, for indicated services not in excess of $300.

End Part Start Part

PART 814—SEALED BIDDING

Subpart 814.1—Use of Sealed Bidding
814.104
Types of contracts.
814.104-70
Fixed-price contracts with escalation.
Subpart 814.2—Solicitation of Bids
814.201
Preparation of invitations for bids.
814.201-6
Solicitation provisions.
814.203
Methods of soliciting bids.
814.203-1
Transmittal to prospective bidders.
814.204
Records of invitations for bids and records of bids.
814.208
Amendment of invitation for bids.
Subpart 814.3—Submission of Bids
814.301
Responsiveness of bids.
814.302
Bid submission.
814.304
Submission, modification, and withdrawal of bids.
Subpart 814.4—Opening of Bids and Award of Contract
814.401
Receipt and safeguarding of bids.
814.402
Opening of bids.
814.403
Recording of bids.
814.404
Rejection of bids.
814.404-1
Cancellation of invitations after opening.
814.404-2
Rejection of individual bids.
814.404-70
Questions involving the responsiveness of a bid.
814.407
Mistakes in bids.
814.407-3
Other mistakes disclosed before award.
814.407-4
Mistakes after award.
814.408
Award.
814.408-70
Award when only one bid is received.
814.408-71
Recommendation for award (construction).
814.409
Information to bidders.
Start Authority

Authority: 40 U.S.C. 121(c) and 48 CFR 1.301-1.304.

End Authority
Subpart 814.1—Use of Sealed Bidding
814.104
Types of contracts.
814.104-70
Fixed-price contracts with escalation.

When fixed price contracts with escalation are authorized under 816.102(a), a contracting officer must comply with FAR 16.203-1 through 16.203-4.

Subpart 814.2—Solicitation of Bids

Preparation of invitations for bids.

(a) An invitation for bids for supplies, equipment, and services must be serially numbered at the time of issue. Numbers assigned locally must consist of the facility or VA National Acquisition Center division number, the serial number of the invitation, and the fiscal year in which the VA facility issues the invitation, e.g., 533-24-05 for the 24th invitation issued by VA facility 533 in Fiscal Year 2005. A series beginning with the number 1 must be started each fiscal year. Numbers assigned from a national register may be sequential, without regard to year, and use whatever numbering system assigned by the national system.

(1) An invitation for bid for supplies, equipment, and services, that is numbered locally, must be numbered in the series of the year in which it is issued if it is issued, accepted, and becomes a contract in the same fiscal year but, because of procurement lead time, will not be performed until the next fiscal year.

(2) An invitation for bid, that is numbered locally, must be numbered in the next fiscal year series if it is issued Start Printed Page 2375in one fiscal year but the contract will become effective and will be performed only in the next fiscal year.

(b) An invitation for a construction contract must bear the applicable invitation for bid number and the project number, if assigned.

(c) An invitation for bid containing a summary bid request must include the following statement:

‘The award will be made on either an individual item basis or summary bid basis, whichever results in the lowest cost to the Government. Therefore, to assure proper evaluation of all bids, a bidder quoting a summary bid price must also quote a price on each individual item included in the summary bid price.'

(d) When a contracting officer determines that it will be to the Government's advantage to make an award by group or groups of items, the contracting officer must include a provision for the award by group or groups of items in the invitation for bids. This may apply when the items in the group or groups are readily available from sources to be solicited; and one of the following apply:

(1) It is desirable to award a minimum number of contracts.

(2) Furniture or fixtures are required for a single project and uniformity of design is desirable.

(3) The articles required will be assembled and used as a unit.

(e) A solicitation for a construction contract must contain a statement on the order of priority in which VA will award any alternative bid items, based on the relative importance of the items, VA's cost estimate, and the amount of funds available, when the following apply:

(1) VA intends to make a single aggregate award for all items in the solicitation within certain fiscal limitations.

(2) The solicitation asks for prices on an item and alternate item basis.

(f) A bid item schedule in a solicitation issued in compliance with paragraph (e) of this section should be structured substantially as follows:

A single award will be made on Item No. 1, but in the event the offer exceeds the funds available, a single award will be made on Item No. 2 or Item No. 3, in that order, based on available funding. Offerors should quote a price on each item listed.

Item No. 1—Furnish all labor, material, equipment, etc., to paint Buildings No. 1, 2, and 3: $____.

Alternate items in order of priority:

Item No. 2—Furnish all labor, material, equipment, etc., to paint Buildings No. 1 and 2: $____.

Item No. 3—Furnish all labor, material, equipment, etc., to paint Building No. 1: $____.

Solicitation provisions.

(a) The contracting officer must prominently place the provision entitled “Caution to Bidders—Bid Envelopes,” as set forth in 852.214-70, in all invitations for bids where bid submissions are by other than electronic means.

(b) In an invitation for bid for supplies, equipment, or services (other than construction), the contracting officer must define the extent to which VA will authorize and consider alternate bids. VA will consider for acceptance an alternate specified on construction projects only as a part of the basic item.

(1) When VA will consider an alternate item only if no bids or insufficient bids are received on an item desired, the contracting officer must include the provision set forth in 852.214-71, Restrictions on Alternate Item(s), in the invitation.

(2) When VA will consider an alternate item on an equal basis with the item specified, the contracting officer must include the provision set forth in 852.214-72, Alternate Item(s), in the invitation.

(3) In addition to the provision referenced in paragraph (b)(1) or (2) of this section, the contracting officer must include the provision set forth in 852.214-73, Alternate Packaging and Packing, in the invitation when bids will be allowed on different packaging, unit designation, etc.

(c) When the contracting officer determines that samples are necessary to the proper awarding of a contract, the contracting officer must include the provision set forth in 852.214-74, Bid Samples, in the solicitation, along with the provision in FAR 52.214-20, Bid Samples.

Methods of soliciting bids.
Transmittal to prospective bidders.

The contracting officer should include either a bid envelope or OF 17, Sealed Bid Label, with each invitation for bids furnished by mail or hand delivered to prospective bidders.

Records of invitations for bids and records of bids.

(a) The issuing office must establish and maintain a single register on a fiscal year basis for all solicitations. For each invitation to bid or request for proposal, the register must include the following:

(1) Bid or proposal number.

(2) Date of issue.

(3) Date of opening.

(4) Commodity or service involved.

(5) Disposition (i.e., contract number or purchase order number or, when applicable, no award).

(b) Maintenance of the contract file prescribed by Part 804 and retention of canceled Invitation for Bid files will fulfill the requirements set forth in FAR 14.204(b).

Amendment of invitation for bids.

The contracting officer must send amendments to holders of drawings and specifications by certified mail, return receipt requested, or any other method that provides evidence of receipt. The contracting officer may send amendments by telegram, facsimile, or other method of rapid delivery that provides evidence of receipt, if time does not permit mailing.

Subpart 814.3—Submission of Bids

Responsiveness of bids.

Where a contracting officer cannot administratively determine, in accordance with FAR 14.301, the timeliness of the submission of a bid, modification, or withdrawal, the contracting officer must submit the matter through the DSPE to the Comptroller General for a decision. The submission must include copies of all pertinent papers.

Bid submission.

A bid hand-carried by the bidder or his agent will be considered late unless delivered to the addressee designated in the bid invitation before the time set for opening.

Submission, modification, and withdrawal of bids.

(a) A notification to late bidders must specify the final date by which VA must receive evidence. This date must be within the time allowed by the apparent low bidder for acceptance of the low bidder's bid.

(b) All bids received by mail or delivered in person by the bidder (or telegram where authorized) must be time and date stamped immediately upon receipt at the VA facility mail room and in the office of the addressee designated in the invitation.

Subpart 814.4—Opening of Bids and Award of Contract

Receipt and safeguarding of bids.

The contracting officer is designated as the official to open bids for identification, as provided in FAR 14.401.

Opening of bids.

(a) The contracting officer must serve as, or designate, a bid opening officer, and must also designate a recorder.Start Printed Page 2376

(b) If a bid bond is required, the bid opening officer must read aloud the form and amount of bid security and the name of the surety. The recorder must record this information.

Recording of bids.

(a) The recorder must transcribe the information required for bid evaluation on the appropriate Abstract of Offers form (SF 1409 or OF 1419). The evaluation data may be recorded on supplemental sheets or forms such as VA Form 10-2237b, Request for Dietetic Supplies, provided that any supplemental sheets or forms are covered by one of the forms authorized for recording bid or price data.

(b) The bid opening officer must comply with the instructions in FAR 14.403 and certify on the abstract the date and hour at which the bids were opened. Where erasures, strikeovers, or changes in price are noted at the time of bid opening, a statement to that effect must also be included on, or attached to, the abstract or record of bids.

Rejection of bids.
Cancellation of invitations after opening.

(a) For each invitation to bid that VA cancels or for which it receives no bid, the contracting officer must do the following:

(1) File a copy of the invitation for bids, as provided for in FAR 14.404-1, together with the abstract showing to whom such bids were sent, in a separate folder identified by the invitation number.

(2) Annotate the abstract to show why an award was not made.

(3) Retain the folders for the current and two succeeding fiscal years.

(b) The HCA may approve cancellation of invitations for bid after opening and may approve completion of the acquisition after cancellation, as provided in FAR 14.404-1(e). The contracting officer must submit a Determination and Finding to the HCA for approval and signature.

Rejection of individual bids.

(a) When a contracting officer finds a bid that is being considered for an award is incomplete, e.g., all pages of the invitation have not been returned by the bidder, the contracting officer will take whichever of the following actions that is appropriate:

(1) Make a determination that the bid as submitted is in such a form that acceptance would create a valid and binding contract, requiring the contractor to perform in accordance with all of the material terms and conditions of the invitation. The determination may be based on the fact that the bid as submitted includes evidence that the offeror intends to be bound by all the material terms and conditions of the invitation.

(2) Make a determination that the bid as submitted is in such form that acceptance would not create a valid and binding contract.

(b) When VA receives a single bid in response to a solicitation, the contracting officer must not reject the offer simply because it specifies a bid acceptance time that is shorter than that contained in the solicitation, unless a compelling reason exists for rejecting such a bid. Insufficient time to properly evaluate an offer is a compelling reason for rejection; however, the contracting officer must first request the offeror to extend the acceptance date of the bid to allow for proper evaluation.

(c) In those cases where VA receives more than one bid, the contracting officer must reject as nonresponsive an individual bid that is not in compliance with the Government's bid acceptance time, since consideration of such an offer would unfairly disadvantage other bidders.

Questions involving the responsiveness of a bid.

If a contracting officer cannot resolve a question involving the responsiveness of a bid, the contracting officer may submit the question to the Comptroller General through the DSPE.

Mistakes in bids.
Other mistakes disclosed before award.

(a) In accordance with FAR 14.407-3(e), the authority of the Secretary to make the administrative determinations set forth in FAR 14.407-3(a), (b), (c), and (d) is delegated to the SPE and is further delegated, without power of redelegation, to the DSPE. This delegation in no way impairs the delegations contained in Unpublished Decision of the Comptroller General B-122003 dated November 22, 1954.

(b) When a bidder alleges a mistake in his or her bid before award, after complying with the provisions of FAR 14.407-3, the contracting officer must submit the complete file to the DSPE for an administrative determination. Based upon the evidence submitted, the DSPE shall determine the action the contracting officer is to take. The contracting officer may make no award until the DSPE makes a determination.

Mistakes after award.

(a) When a contracting officer corrects a mistake in bid under FAR 14.407-4(a), the contracting officer must forward a copy of the contract amendment or supplemental agreement and a copy of the contracting officer's determination, to the DSPE.

(b) For mistakes in a bid alleged after award, the contracting officer's proposed determination, prepared in accordance with FAR 14.407-4, must be forwarded to OGC through the DSPE, Acquisition Resources Service, for legal coordination. The DSPE shall transmit the results of this coordination to the contracting officer, who will make the final determination on the alleged mistake in bid after award.

(c) The DSPE, Acquisition Resources Service, must maintain the agency records of mistakes in bids after award required by FAR 14.407-4.

Award.
Award when only one bid is received.

(a) When VA receives only one bid in response to an invitation for bids, the contracting officer may consider and accept the bid if all of the following apply:

(1) The specifications used in the invitation were not restrictive.

(2) VA solicited adequate competition.

(3) The price is reasonable.

(4) The bid is otherwise in accordance with the invitation for bids.

(b) The contracting officer must make the determination in writing, and include it the contract file.

Recommendation for award (construction).

(a) For Central Office contracts, the Chief Facilities Management Officer, Office of Facilities Management, must analyze all bids received and submit a memorandum to the Secretary recommending award or other disposition of the project. A copy of each of the following must accompany the memorandum:

(1) The invitation.

(2) Each bid received.

(3) The abstract.

(4) Any other pertinent data.

(b) For facility-level contracts, the Chief, Engineering Service, must analyze all bids received and submit a memorandum recommending award or other disposition of the project to the contracting officer. The contracting officer alone must make the final decision to accept or reject the lowest responsive bid and the determination as to the responsibility of a prospective contractor.

Information to bidders.

(a) An employee of VA may not disclose information as to probable Start Printed Page 2377acceptance or rejection of any offer to any bidder or other person outside of VA.

(b) Except as provided in paragraphs (c) and (d) of this section, information about performance under a contract or an accepted bid is not public information and will be released to persons outside of VA only upon the authority of the immediate supervisor of the contracting officer.

(c) Except as provided in paragraph (d) of this section, the contracting officer may furnish information on performance under a contract to those having a legitimate interest, such as banks, other financial companies and Government departments and agencies.

(d) When litigation is involved, all information must be furnished through OGC.

End Part Start Part

PART 815—CONTRACTING BY NEGOTIATION

Subpart 815.3—Source Selection
815.303
Responsibilities.
Subpart 815.4—Contract Pricing
815.404
Proposal analysis.
815.404-1
Proposal analysis techniques.
815.404-2
Information to support proposal analysis.
Subpart 815.6—Unsolicited Proposals
815.604
Department points of contact.
815.606
Department procedures.
815.606-1
Receipt and initial review.
Start Authority

Authority: 40 U.S.C. 121(c) and 48 CFR 1.301-1.304.

End Authority

Subpart 815.3—Source Selection

Responsibilities.

The authority of the Secretary to appoint an individual other than the contracting officer to service as the source selection authority for a particular acquisition or group of acquisitions is delegated to the SPE and is further delegated to the DSPE. If an HCA wishes to designate an individual other than the delegated contracting officer as the source selection authority for a particular acquisition or group of acquisitions, the HCA shall prepare a request and justification and shall submit the request through channels to the DSPE for approval.

Subpart 815.4—Contract Pricing

Proposal analysis.
Proposal analysis techniques.

(a) Contracting officers are responsible for the technical and administrative sufficiency of the contracts they enter into. Contracting officers must ensure that contracts undergo all applicable legal and technical reviews. (See 801.602-70.)

(b) Contracting officers determine the level of technical analyses necessary for initial and revised pricing of all negotiated prime contracts, including subcontract pricing under them, and contract modifications. Contracting officers must request technical analyses of the proposals from the appropriate technical personnel. The technical analyses must address, as a minimum, the items set forth in FAR 15.404-1(e)(2).

(c) The contracting officer must document the results of such analyses in the contract file and make the results available to the auditor performing the pre-award audit.

Information to support proposal analysis.

In evaluating start-up and other non-recurring costs, the contracting officer must determine the extent to which these costs are included in the proposed price and the intent to absorb or recover the costs in any future noncompetitive procurement or other pricing action. The contracting officer must ensure, with the assistance of the Assistant Inspector General for Policy, Planning, and Resources, as required or considered necessary, that VA will not pay the costs twice. For example, the cost of equipment that the Government pays for through a setup or connection agreement must not be included in depreciation cost of a subsequently negotiated agreement.

Subpart 815.6—Unsolicited Proposals

Department points of contact.

A VA employee who receives an unsolicited proposal or inquiries from a potential offeror of an unsolicited proposal must refer the proposals or inquiries to the following:

(a) Facility level unsolicited proposals must be referred to the HCA for the field facility.

(b) Proposals to the VA National Acquisition Center must be referred to the Executive Director and Chief Operating Officer, VA National Acquisition Center.

(c) Proposals to VA Central Office must be referred to the DSPE.

Department procedures.

(a) The VA contact point will do the following:

(1) Determine the nature of the potential proposal and which technical/professional disciplines within VA to consult to determine the need for the proposal and the likelihood that a formal proposal would earn favorable review.

(2) In consultation with such technical/professional offices, the VA contact point will furnish the potential offeror the information specified in FAR 15.604 and any other information that might be of assistance to the potential offeror.

(b) The contact point will maintain a record of advance guidance provided and the disposition/recommendation regarding the potential offer.

(c) The contact point will review the unsolicited proposal and ensure that it is complete as prescribed in FAR 15.605. If required information is not submitted, the contact point will:

(1) Determine if FAR 15.604 requires advance guidance;

(2) Determine whether a comprehensive evaluation prescribed by FAR 15.606-2 is appropriate and, if so, request that the offeror provide the necessary information; and,

(3) Establish an estimated due date for completion of the review process.

Receipt and initial review.

(a) When the VA contact point determines a proposal warrants a comprehensive evaluation (i.e., the proposal complies with the requirements in FAR 15.606-1(a) and is related to VA's mission), the contact point must contact the offeror to ensure that all data that should be restricted in accordance with FAR 15.609 has been identified.

(b) The contact point must maintain a log of all unsolicited proposals to be evaluated. The log must indicate the following:

(1) The date the proposal was received.

(2) The date that the unsolicited proposal was determined to warrant a comprehensive evaluation.

(3) A description of the proposal.

(4) The offices requested to evaluate the proposal and the date the offices are requested to return their evaluations.

(5) The date the reviewing offices finalize their respective evaluations.

(6) The final disposition of the proposal.

(c) The contact point must advise each office assigned responsibility for reviewing an unsolicited proposal of the need to evaluate the proposal against the criteria set forth in FAR 15.607(a)(1) through (4). If the reviewers determine that the proposal fails to meet any of the criteria, the contact point must be advised. The contact point must return the proposal to the offeror, citing the reasons therefore.

(d) The contact point must obtain approval of the DSPE before negotiation on proposals processed at field offices. The contact point must provide the Start Printed Page 2378DSPE all necessary documentation supporting the noncompetitive negotiation, including any justification and approval required by FAR Subpart 6.3 and results of any synopsis required by FAR Subpart 5.2. The DSPE will consult the appropriate VA Central Office program official(s) and return the final decision to the contact point.

(e) The contact point will number each copy of the unsolicited proposal. A reviewing office must obtain approval of the contact point before duplicating an unsolicited proposal and must number copies as specified by the contact point. All copies must be returned to the contact point when the review is complete.

End Part Start Part

PART 816—TYPES OF CONTRACTS

Subpart 816.1—Selecting Contract Types
816.102
Policies.
Subpart 816.5—Indefinite-Delivery Contracts
816.504
Indefinite-quantity contracts.
816.505
Ordering.
Subpart 816.70—Unauthorized Agreements
816.7001
Letters of availability.
Start Authority

Authority: 40 U.S.C. 121(c) and 48 CFR 1.301-1.304.

End Authority

Subpart 816.1—Selecting Contract Types

Policies.

(a) Contracting officers must obtain technical review of solicitations that include a clause that provides for economic price adjustment specified in FAR 16.203-4 or any locally developed clause (see FAR 16.203-4(d)(2) and 801.602-72(d)). The request for approval must include a clearly stated need for the clause.

(b) The contracting officer must obtain the approval of the Director, Acquisition Resources Service (049A5), VA Central Office, before issuing a solicitation or awarding a contract that includes time-and-material or labor-hour pricing provisions if the ceiling price or estimated value of the acquisition exceeds $100,000. See 801.602-71 for technical review requirements. Excluded from this requirement are time-and-material or labor-hour solicitations or proposed contracts covering emergencies, such as repair of a broken water, sewer, or communication line, repair of storm damage, etc. (i.e., where FAR 6.302-2 applies).

(c) Except as provided in FAR 32.703-3, a contract that involves a direct obligation of appropriations and lasts for more than one year from the beginning of the contract period must provide that:

(1) The contract applies to the period stated in the contract, subject to availability of funds; and

(2) The contractor will not perform any service under the contract after September 30 of each fiscal year (or beyond the period of the basic contract or any authorized option if the contract crosses fiscal years as provided in FAR 32.703-3(b)) unless the contractor obtains specific authorization from the contracting officer.

(d) A/E contracts, construction contracts, or professional engineer contracts, financed by “no year” appropriations, are not subject to the requirements of paragraph (c) of this section.

Subpart 816.5—Indefinite-Delivery Contracts

Indefinite-quantity contracts.

(a) Except as provided in paragraphs (b), (c), and (d) of this section, when the contracting officer cannot determine definite quantities to be acquired under a solicitation and intends to issue a solicitation for estimated quantities, the contracting officer shall insert the clause at 852.216-70, Estimated Quantities.

(b) The contracting officer shall insert the Alternate I clause at 852.216-70 in solicitations for bulk coal.

(c) The contracting officer shall insert the Alternate II clause at 852.216-70 in solicitations for estimated quantities of orthopedic, prosthetic, and optical supplies.

(d) The contracting officer shall insert the Alternate III clause at 852.216-70 in solicitations for monuments and headstones.

Ordering

The task order contract and delivery order ombudsman for VA is the Associate Deputy Assistant Secretary for Acquisitions (see FAR 16.505(b)(5)). Contracting officers may obtain the name, telephone number, facsimile number, and e-mail address of the current Associate Deputy Assistant Secretary for Acquisitions by contacting: The Office of Acquisitions (049A), VA Central Office, 810 Vermont Ave., NW., Washington, DC 20420.

Subpart 816.70—Unauthorized Agreements

Letters of availability.

(a) Description. A letter of availability (sometimes inappropriately called a letter of intent) is a letter to a supplier that primarily seeks to reserve a place on the supplier's production or delivery schedule for long lead-time items. A letter of availability usually indicates products or services being considered for procurement. A supplier should not construe a letter of availability as a commitment. Prospective contractors sometimes solicit letters of availability or the letters may originate from Government personnel. A letter of availability differs from a letter contract, which is specifically authorized in FAR 16.603.

(b) Policy. (1) For the following reasons, contracting officers may not use letters of availability unless the DSPE specifically authorizes them to do so:

(i) Letters of availability often cause potential contractors to initiate costly preparations in anticipation of contract award.

(ii) Procurements announced in such letters do not always materialize. The result may be costly to the Government, the prospective contractor, or both. If the author of the letter of availability is an authorized contracting officer of VA, the Government may be bound by the action, even though the action is contrary to sound procurement practices and/or fiscal regulations. If the author of the letter of availability lacks procurement authority, the prospective contractor may incur substantial expenditures that may not be recovered from the Government. In this instance, the prospective contractor may seek to hold the unauthorized author personally liable.

(iii) The issuance of a letter of availability may violate the “Anti-Deficiency Act” (31 U.S.C. 1341).

(2) Contractors need access to procurement information as soon as possible to make timely preparations. Therefore, procurement personnel should act as efficiently and expeditiously as possible on all procurement actions.

End Part Start Part

PART 817—SPECIAL CONTRACTING METHODS

Subpart 817.1—Multi-year Contracting
817.105
Policy.
817.105-1
Uses.
Subpart 817.2—Options
817.202
Use of options.
817.204
Contracts.
Subpart 817.4—Leader Company Contracting
817.402
Limitations.
Start Authority

Authority: 38 U.S.C. 501; 40 U.S.C. 121(c); and 48 CFR 1.301-1.304.

End Authority Start Printed Page 2379

Subpart 817.1—Multi-year Contracting

Policy.
Uses.

(a) Under 38 U.S.C. 114, VA contracting officers may enter into multi-year contracts for supplies and services not to exceed 5 years (unless otherwise authorized by statute), provided the Secretary or designee makes the following determinations:

(1) Appropriations are available for obligation to pay for the total payments for the fiscal year in which the contract is awarded plus the estimated amount of any cancellation charges.

(2) The contract serves the best interest of the Government by:

(i) Reducing cost;

(ii) Achieving contract administration and other efficiencies;

(iii) Increasing quality contract performance; and

(iv) Encouraging effective competition.

(3) That, during the contract period:

(i) Demand for the supplies or services will continue;

(ii) Substantial changes in demand for supplies and services in terms of quantity or rate of delivery are unlikely; and

(iii) Specifications for the supplies or services will remain reasonably stable.

(4) The risk of the contractor's inability to perform under the terms and conditions of the contract is low.

(5) A multi-year contract will not inhibit competition from small businesses.

(6) For a pharmaceutical item for which a patent has expired less than 4 years before the solicitation issue date, that there is no substantial likelihood that increased competition among potential contractors would occur during the term of the contract as the result of the availability of generic equivalents increasing during the term of the contract.

(b) The Secretary has delegated authority to make the determinations specified in 817.105-1(a) as follows:

(1) HCAs may make the above determinations and approve contracts that do not require legal/technical reviews under 801.602-70 and that do not contain a first year cancellation ceiling exceeding 20 percent of the contract value over the full multi-year term.

(2) Authority to make the above determinations and to approval all other proposed multi-year contracts is delegated to the SPE and is further delegated to the DSPE. For approval purposes, the HCA will justify and document the use of a multi-year contract against each of the criteria specified in paragraphs (a)(1) through (a)(6) of this section and forward to the DSPE for approval. The justification must explain the cancellation ceiling and the method used to calculate that ceiling. The justification also must explain the advantages of multi-year contracts over other alternative methods, e.g., option year contracts.

(c) The contracting officer must develop the cancellation ceilings in accordance with FAR 17.106-1. (38 U.S.C. 114)

Subpart 817.2—Options

Use of options.

All solicitations developed under Office of Management and Budget Circular A-76 (Revised) cost comparisons will provide for four one-year renewal options as prescribed in FAR Subpart 17.2. The contracting officer must forward requests to use less or more than the prescribed contract period for Circular A-76 (Revised) cost comparisons to the DSPE for approval.

Contracts.

(a) The contracting officer must obtain the approval of the DSPE before awarding a contract that includes options exceeding the 5-year limitation specified in FAR 17.204(e). This requirement does not apply to contracts to be awarded by or on behalf of the VA Office of Inspector General. The request for approval must include the following:

(1) Supporting documentation, rationale, and justifications for the use of options (see FAR 17.205) and for exceeding the 5-year limitation.

(2) Documentation that the contracting officer has considered and addressed the limitations specified in FAR 17.202(b) and (c).

(b) Solicitations that require technical review in accordance with 801.602-71 through 801.602-73 shall be submitted for review concurrently as provided therein.

Subpart 817.4—Leader Company Contracting

Limitations.

(a) Except as provided in paragraph (b) of this section, the Government shall not initiate or execute leader company contracts.

(b) The DSPE may designate a contracting officer to enter into a leader company contract for the benefit of VA and the Government. The DSPE must designate a contracting officer by name for a specific contract. The named contracting officer will submit the proposed contract, with a determination and finding, for legal review in accordance with 801.602-71.

SUBCHAPTER D—SOCIOECONOMIC PROGRAMS

End Part Start Part

PART 819—SMALL BUSINESS PROGRAMS

Subpart 819.2—Policies
819.201
General policy.
801.202
Specific policies.
819.202-1
Encouraging small business participation in acquisitions.
819.202-5
Data collection and reporting requirements.
819.202-70
HCA responsibilities.
819.202-71
Additional contracting officer responsibilities.
819.202-72
Order of precedence.
Subpart 819.5—Set-Asides for Small Business
819.502
Setting aside acquisitions.
819.502-2
Total small business set-asides.
819.502-3
Partial set-asides.
Subpart 819.6—Certificates of Competency and Determinations of Responsibility
819.602
Procedures.
819.602-3
Resolving differences between VA and the Small Business Administration.
Subpart 819.8—Contracting With the Small Business Administration (The 8(a) Program)
819.800
General.
Subpart 819.70—Veteran-Owned and Operated Small Businesses
Policy.
Start Authority

Authority: 40 U.S.C. 121(c) and 48 CFR 1.301-1.304.

End Authority
Subpart 819.2—Policies
General policy.

The Director, Office of Small and Disadvantaged Business Utilization, is designated as the official responsible for making the determination required by FAR 19.201(f).

Specific policies.
Encouraging small business participation in acquisitions.

Contracting officers may negotiate payment terms of less than 30 calendar days to encourage small business participation. A period of less than 7 days may not be prescribed (see FAR 32.908(c)(2)). The contracting officer and the local fiscal officer must be in agreement on the negotiated payment terms before awarding the contract.

Data collection and reporting requirements.

(a) Administration heads, staff office directors, and HCAs must, in addition to the responsibilities designated in FAR Start Printed Page 238019.202-5, cooperate with the Office of Small and Disadvantaged Business Utilization in formulating specific small business program goals and providing other data necessary for goal assessment.

(b) Office of Facilities Management and Office of Acquisition and Materiel Management contracting offices must report achievement of subcontracting goals on a semiannual basis. The Office of Small and Disadvantaged Business Utilization must receive the reports not later than April 30 for the period ending March 31, and November 1 for the period ending September 30.

HCA responsibilities.

A HCA must perform the following functions in support of the small business program. These functions cannot be delegated without written approval of the Director, Office of Small and Disadvantaged Business Utilization:

(a) Develop, on an annual basis, a plan of operation to increase the share of contracts and purchase orders awarded to the small business programs prescribed in FAR Part 19. This plan must also include veteran-owned and service-disabled veteran-owned concerns.

(b) Promote goals for the small business programs set forth in FAR Part 19. This must also include veteran-owned and service-disabled veteran-owned concerns.

(c) Review the types and classes of items and services to be purchased to determine the applicability of individual small business set-asides.

(d) Review class set-asides, established in accordance with criteria in FAR 19.503, at least annually to determine whether items or services procured under a unilateral or joint set-aside should be modified or withdrawn.

(e) Maintain updated lists of acquisitions reserved for small business on a class basis.

(f) If the acquisition activity is assigned to a Small Business Administration Procurement Center Representative, assure that the representative is provided logistical support, cooperation, and access to all reasonably obtainable contract information directly pertinent to the Small Business Administration Procurement Center Representative's official duties.

(g) Encourage technical personnel and end-users to participate in discussions with small businesses, veteran owned, and service-disabled veteran-owned concerns.

(h) Attend conferences and meetings publicizing small business programs. This responsibility may be delegated without the written approval of the Director, Office of Small and Disadvantaged Business Utilization.

Additional contracting officer responsibilities.

In addition to the duties designated in FAR 19.202 through 19.202-6, contracting officers must perform the following functions in support of the small business program:

(a) Make maximum use of small business source lists.

(b) Assure that small business firms are identified on solicitation mailing lists and bid abstracts.

(c) Assure that specifications are not unduly restrictive, thereby enabling small business participation to the maximum extent possible.

(d) Assist and counsel small business firms with individual problems.

(e) Provide for counseling non-responsive or non-responsible small business bidders to help qualify them for future awards.

(f) Submit informational copies of all small business protests and appeals to the Director, Office of Small and Disadvantaged Business Utilization, at the same time they are submitted to the Small Business Administration.

Subpart 819.5—Set-Asides For Small Business
Setting aside acquisitions.
Total small business set-asides.

(a) When a total small business set-aside is made, one of the following statements, as applicable, will be included in the solicitation for bids:

(1) Notice of total small business set-aside, page ____, applies to all items in this solicitation.

(2) Notice of total small business set-aside, page ____, applies to items ____ through ____ in this solicitation.

(b) Contracting officers must ensure that appropriate product or service classification and the related size standard are included in each solicitation.

Partial set-asides.

When, in accordance with the provisions of FAR 19.502-3, it is determined that a particular procurement will be partially set aside for exclusive small business participation or small business participation, the solicitation for bids will have appropriate product or service classification, appropriate size standard and whichever of the following statement shall be placed on the face page:

Notice of partial set-aside, page ____, applies to item ____ through item ____ in this solicitation.

Subpart 819.6—Certificates of Competency and Determinations of Responsibility
Procedures.
Resolving differences between VA and the Small Business Administration.

The Director, OSDBU, is the VA liaison with the Small Business Administration. Information copies of correspondence sent to the Small Business Administration seeking a certificate of competency determination must be concurrently provided to the Director, OSDBU. Before appealing a certificate of competency, the Head of the Contracting Activity must seek concurrence from the Director, OSDBU.

Subpart 819.8—Contracting With the Small Business Administration (The 8(a) Program)
General.

(a) No contract will be entered into with SBA under section 8(a) of the Small Business Act (15 U.S.C. 637(a)) unless a certification is made by the Administrator of that agency, or designee, that SBA is competent to perform the contract.

(b) When it is determined that the requirements of VA are appropriate for inclusion in this program, the contracting officer will make this fact known to proper officials of the SBA regional office servicing his/her area. However, when projects funded from minor construction appropriation (between $400,000 and $2 million) are proposed for 8(a) acquisition, the Director, Office of Small and Disadvantaged Business Utilization (OSDBU) (00SB), shall be contacted by telephone or notified in writing in order to afford the OSDBU an opportunity to identify possible 8(a) sources prior to apprising SBA officials. If the certification required by paragraph (a) of this section is received, the VA contracting officer will secure from SBA the name(s) and location(s) of their subcontractor(s) and the unit price(s) to be paid. Should these prices be within a range acceptable to VA, the contracting officer will notify SBA of acceptance.

(c) The contract will be made between VA and SBA and will be administered by VA.

Start Printed Page 2381 Subpart 819.70—Veteran-Owned and Operated Small Businesses
Policy.

(a) The Small Business Act directs the Small Business Administration to give “special consideration” to veterans of the Armed Forces in all Small Business Administration programs. It is the policy of VA to encourage participation by all veteran-owned and operated small businesses in VA acquisitions.

(b) All VA facilities having procurement requirements for which veteran-owned small businesses are known sources must take affirmative action to solicit these firms and assist them in participating in VA acquisition opportunities.

End Part Start Part

PART 822—APPLICATION OF LABOR LAWS TO GOVERNMENT ACQUISITIONS

Subpart 822.3—Contract Work Hours and Safety Standards Act
822.304
Variations, tolerances, and exemptions.
822.305
Contract clause.
Subpart 822.4—Labor Standards for Contracts Involving Construction
822.406
Administration and enforcement.
822.406-11
Contract terminations.
Start Authority

Authority: 29 CFR 5.15(d); 40 U.S.C. 121(c); 48 CFR 1.301-1.304.

End Authority

Subpart 822.3—Contract Work Hours and Safety Standards Act

Variations, tolerances, and exemptions.

When issuing a contract for nursing home care, a contracting officer may exempt a contractor from certain requirements of the Contract Work Hours and Safety Standards Act (40 U.S.C. 3701-3708) regarding the payment of overtime (see 29 CFR 5.15(d)(2) and 852.222-70).

Contract clause.

The contracting officer must insert the clause at 852.222-70, Contract Work Hours and Safety Standards Act—Nursing Home Care Contract Supplement, in solicitations and contracts for nursing home care when the FAR clause at 52.222-4, Contract Work Hours and Safety Standards Act—Overtime Compensation, is included.

Subpart 822.4—Labor Standards for Contracts Involving Construction

Administration and enforcement.
Contract terminations.

(a) Contracting officers must submit any proposed termination of a contract based on violations of the labor standard provisions of the contract to OGC for review and comment prior to taking final action. The submittal must include a detailed explanation of the facts and circumstances involved. Contracting officers, except those in the Office of Facilities Management, shall forward the submittal to OGC through the DSPE. Contracting officers in the Office of Facilities Management shall forward the submittal to OGC through the Chief Facilities Management Officer, Office of Facilities Management.

(b) If the contract is to be terminated, the DSPE or the Chief Facilities Management Officer, Office of Facilities Management, must submit the reports required by 29 CFR 5.7(d) over the signature of the SPE.

End Part Start Part

PART 824—PROTECTION OF PRIVACY AND FREEDOM OF INFORMATION

Subpart 824.1—Protection of Individual Privacy
824.102
General.
Subpart 824.2—Freedom of Information Act
824.203
Policy.
Start Authority

Authority: 38 CFR 1.550-1.559 and 1.575-1.584; 40 U.S.C. 121(c), and 48 CFR 1.301-1.304.

End Authority

Subpart 824.1—Protection of Individual Privacy

General.

VA rules implementing the Privacy Act of 1974 are in 38 CFR 1.575 through 1.584.

Subpart 824.2—Freedom of Information Act

Policy.

VA rules implementing the Freedom of Information Act are in 38 CFR 1.550 through 1.559.

End Part Start Part

PART 825—FOREIGN ACQUISITION

Subpart 825.1—Buy American Act—Supplies
825.103
Exceptions.
825.104
Nonavailable articles.
Subpart 825.2—Buy American Act—Construction Materials
825.202
Exceptions.
825.205
Postaward determinations.
Subpart 825.6—Trade Sanctions
825.602
Exceptions.
Subpart 825.8—Other International Agreements and Coordination
825.870
Technical assistance.
Subpart 825.9—Customs and Duties
825.902
Procedures.
825.902-70
Technical assistance.
Subpart 825.10—Additional Foreign Acquisition Regulations
825.1001
Waiver of right to examination of records.
Subpart 825.11—Solicitation Provisions and Contract Clauses
825.1102
Acquisition of construction.
Start Authority

Authority: 40 U.S.C. 121(c) and 48 CFR 1.301-1.304.

End Authority

Subpart 825.1—Buy American Act—Supplies

Exceptions.

(a) Public Interest. When a contracting officer believes that a determination that domestic preference would be inconsistent with the public interest is necessary under FAR 25.103(a), the contracting officer must submit the request for determination to the DSPE for submission to the SPE, who will forward the request to the Secretary for approval. The request for determination must contain all the facts and other pertinent information upon which a determination may be made.

(b) Non-availability. (1) For each determination of non-availability made in accordance with FAR 25.103(b)(2)(i), the HCA must do the following:

(i) Factually support the determination and include the supporting facts in the contract file.

(ii) Forward a copy of the determination, along with supporting documentation, to the DSPE.

(2) If the contracting officer believes that the non-availability of an article is likely to affect future acquisitions, the contracting officer should include a recommendation that a copy of the determination and supporting documentation be forwarded to the Civilian Agency Acquisition Council (CAAC) for possible addition to the list of non-available articles in FAR 25.104. The DSPE will decide whether to submit the material to the CAAC.

Nonavailable articles.

The following items are added to the list of nonavailable articles contained in FAR 25.104:

Glass, Lead

Glass, Wire

Insulin, human

Subpart 825.2—Buy American Act—Construction Materials

Exceptions.

(a) When a determination is required under FAR 25.202(a)(1), the contracting officer must submit the request for determination to the DSPE for submission to the SPE, who will Start Printed Page 2382forward the request to the Secretary. The submission must contain all the facts and other pertinent information necessary for the Secretary to make a determination.

(b) For each determination of non-availability that the HCA makes in accordance with FAR 25.202(a)(2), the HCA must do the following:

(1) Factually support the determination in writing and include the determination in the contract file.

(2) Forward a copy of the determination, along with supporting documentation, to the Chief Facilities Management Officer, Office of Facilities Management, through the DSPE.

(3) If the contracting officer believes that the non-availability of an article is likely to affect future acquisitions, include a recommendation that a copy of the determination and supporting documentation be forwarded to the Civilian Agency Acquisition Council (CAAC) for possible addition to the list of non-available articles in FAR 25.104. The DSPE will decide whether to submit the material to the CAAC.

Postaward determinations.

A post-award determination that an exception to the Buy American Act applies, as provided in FAR 25.205(c), will be made in accordance with FAR 25.202 and 825.202.

Subpart 825.6—Trade Sanctions

Exceptions.

When the contracting officer determines it to be in the best interest of the Government, the contracting officer may request an exception to the requirements of FAR 25.601 from the Secretary through the DSPE and the SPE. Each such request must be fully justified, containing all pertinent facts, as provided in FAR 25.602(b). The SPE is responsible for notifying the U.S. Trade Representative of approved requests, as required by FAR 25.602(b)(2).

Subpart 825.8—Other International Agreements and Coordination

Technical assistance.

Contracting officers may obtain technical information or guidance on international agreements and treaties for procurements outside the United States by contacting the Executive Director and Chief Operating Officer, VA National Acquisition Center.

Subpart 825.9—Customs and Duties

Procedures.
Technical assistance.

Should the regulations contained in FAR Subpart 25.9 be inadequate to meet the particular needs of the contracting officer in clearing items through customs and/or obtaining Duty Free Entry of goods, the contracting officer should contact the nearest United States Customs and Boarder Protection office for technical assistance. The location of the nearest office can be found at the U.S. Customs and Boarder Protection Web site at http://www.customs.gov/​xp/​cgov/​toolbox/​contacts/​cmcs/​.

Subpart 825.10—Additional Foreign Acquisition Regulations

Waiver of right to examination of records.

(a) The contracting officer must prepare proposed determinations and findings to use either of the following:

(1) Alternate I of the FAR clause at 52.212-5, Contract Terms and Conditions Required to Implement Statutes or Executive Orders—Commercial Items.

(2) Alternate III of the FAR clause at 52.215-2, Audit and Records—Negotiation.

(b) The contracting officer must submit the determinations and findings to the DSPE for submission to the SPE, who will forward the request to the Secretary for the signature, as provided in FAR 25.1001(a)(2)(iii). The submission must include all appropriate documentation.

(c) The Secretary, upon concurring with the contracting officer's proposed determination and findings, will, if required by FAR 25.1001(a)(2)(iii), forward the document to the Comptroller General for concurrence.

(d) The completed determination and findings will be made part of the contract file.

Subpart 825.11—Solicitation Provisions and Contract Clauses

Acquisition of construction.

The Buy American Act (41 U.S.C. 10a-d), except as modified by various trade agreements (see FAR Part 25), requires that only domestic construction material be used in the performance of contracts for construction. For solicitations and contracts for construction that contain the FAR clauses related to the Buy American Act, the contracting officer must insert the applicable VAAR clause, with or without an alternate, as shown in Table 825.1102:

Table 825.1102

FAR clauseVAAR clause to be used
FAR 52.225-9, Buy American Act—Construction Materials852.236-89, Buy American Act.
FAR clause 52.225-11, without its Alternate I (see FAR 25.1102(c))852.236-89, Buy American Act, with its Alternate I.
FAR clause 52.225-11, Buy American Act—Construction Materials under Trade Agreements, with its Alternate I (see FAR 25.1102(c)(3))852.236-89, Buy American Act, with its Alternate II.
End Part

SUBCHAPTER E—GENERAL CONTRACTING REQUIREMENTS

Start Part

PART 828—BONDS AND INSURANCE

Subpart 828.1—Bonds and Other Financial Protections
828.101
Bid guarantees.
828.101-2
Solicitation provision or contract clause.
828.101-70
Safekeeping and return of bid guarantee.
828.106
Administration.
828.106-6
Furnishing information.
828.106-70
Bond premium adjustment.
Subpart 828.2—Sureties and Other Security for Bonds
828.203
Acceptability of individual sureties.
828.203-7
Exclusion of individual sureties.
Subpart 828.3—Insurance
828.306
Insurance under fixed-price contracts.
Subpart 828.71—Indemnification of Contractors, Medical Research or Development Contracts
828.7100
Scope of subpart.
828.7101
Approval for indemnification.
828.7102
Extent of indemnification.
828.7103
Financial protection.
Start Authority

Authority: 38 U.S.C. 501; 40 U.S.C. 121(c); and 48 CFR 1.301-1.304.

End Authority Start Printed Page 2383

Subpart 828.1—Bonds and Other Financial Protections

Bid guarantees.
Solicitation provision or contract clause.

When a bid bond is required for supplies or services, the phrase “any cost of acquiring the work” in paragraph (e) of the Bid Guarantee clause in FAR 52.228-1 may be modified to refer to the cost of “supplies,” “services,” etc.

Safekeeping and return of bid guarantee.

(a) The contracting officer must retain, in a safe, certified checks or other negotiable security provided as bid security for the three lowest acceptable bids. After the contract and contract bonds have been signed and approved, the contracting officer must return the certified checks or other negotiable securities either:

(1) In person to the bidder who provides a proper receipt; or

(2) By any method that will provide evidence that the bidder received the security.

(b) The contracting officer should promptly return certified checks or other negotiable security furnished in support of bids, other than those determined to be the three lowest acceptable bids, to the respective bidders either:

(1) In person to the bidder who provides a proper receipt; or

(2) By any method that will provide evidence that the bidder received the security.

(c) The contracting officer will not return commercial bid bonds unless specifically requested to do so by the bidders. If any of the three low bidders request the return of a commercial bid bond, the contracting officer will not return those bid bonds until the contract and contract bonds have been executed by the successful bidder and approved by the contracting officer or all bids have been rejected.

Administration.
Furnishing information.

The contracting officer for the applicable contract will furnish copies of payment bonds to a requestor under the provisions of FAR 28.106-6(c).

Bond premium adjustment.

When performance and payment bonds or payment protection are required, the contract must contain the clause in 852.228-70, Bond Premium Adjustment.

Subpart 828.2—Sureties and Other Security for Bonds

Acceptability of individual sureties.
Exclusion of individual sureties.

The DSPE may make the determinations referenced in FAR 28.203-7:

(a) To exclude individuals from acting as surety on bonds; and

(b) To accept bonds from individuals named on the Excluded Parties List System.

Subpart 828.3—Insurance

Insurance under fixed-price contracts.

(a) Term contracts, or contracts of a continuing nature, for ambulance, automobile and aircraft service, must contain the provision in 852.228-71, Indemnification and Insurance.

(b) Paragraph (a) of this section does not apply to emergency or sporadic ambulance service authorized by VA Manual MP-1, Part II, Chapter 3, or other emergency or sporadic vehicle or aircraft services if both of the following conditions exist:

(1) The service is not used solely for the purpose of avoiding entering into a continuing contract.

(2) The services will be obtained from firms known to carry insurance coverage in accordance with State or local requirements.

Subpart 828.71—Indemnification of Contractors, Medical Research or Development Contracts

Scope of subpart.

(a) This subpart sets forth the policies and procedures concerning indemnification of contractors performing contracts covering medical research or development that involve risks of an unusually hazardous nature, as authorized by 38 U.S.C. 7317.

(b) The authority to indemnify the contractor under this subpart does not create any rights to third parties that would not otherwise exist by law.

(c) As used in this subpart, the term “contractor” includes subcontractors of any tier under a contract containing an indemnification provision under 38 U.S.C. 7317. (38 U.S.C. 7317)

Approval for indemnification.

(a) The Secretary of Veterans Affairs will make the approval determinations for the indemnification of contractors.

(b) Contracting officers must submit requests for approval, together with all available information, to the DSPE for submission to the SPE, who will forward the request to the Secretary for approval. (38 U.S.C. 7317)

Extent of indemnification.

(a) A contract for medical research or development authorized by 38 U.S.C. 7303, may provide that the Government will indemnify the contractor against losses or liability specified in paragraphs (b) and (c) of this section if all of the following apply:

(1) The contract work involves a risk of an unusually hazardous nature.

(2) The losses or liability arise out of the direct performance of the contract.

(3) The losses or liability are not covered by the financial protection required under 828.7103.

(b) The Government may indemnify a contractor for liability (including reasonable expenses of litigation or settlement) to third persons for death, bodily injury, or loss of or damage to property from a risk that the contract defines as unusually hazardous. The indemnification will not cover liability under State or Federal worker's injury compensation laws to employees of the contractor who are both:

(1) Employed at the site of the contract work; and

(2) Working on the contract for which indemnification is granted.

(c) The Government may indemnify the contractor for loss of or damage to property of the contractor from a risk that the contract defines as unusually hazardous.

(d) A contract that provides for indemnification in accordance with this subpart must also require that:

(1) The contractor must notify the contracting officer of any claim or suit against the contractor for death, bodily injury, or loss of or damage to property; and

(2) The Government may choose to control or assist in the defense of any suit or claim for which indemnification is provided in the contract. (38 U.S.C. 7317)

Financial protection.

(a) A contractor must have and maintain an amount of financial protection to cover liability to third persons and loss of or damage to the contractor's property that meets one of the following:

(1) The maximum amount of insurance available from private sources.

(2) A lesser amount that the Secretary establishes after taking into consideration the cost and terms of private insurance.

(b) Financial protection may include private insurance, private contractual indemnities, self-insurance, other proof Start Printed Page 2384of financial responsibility, or a combination that provides the maximum amount required. If a contractor elects to self-insure, the contractor must provide the contracting officer, before award, proof of financial responsibility up to the maximum amount required. (38 U.S.C. 7317)

End Part Start Part

PART 829—TAXES

829.000
Scope of part.
Subpart 829.2—Federal Excise Taxes
829.202
General exemptions.
829.202-70
Tax exemptions for alcohol products.
Subpart 829.3—State and Local Taxes
829.302
Application of State and local taxes to the Government.
829.302-70
Purchases made from patients' funds.
Start Authority

Authority: 40 U.S.C. 121(c) and 48 CFR 1.301-1.304.

End Authority
Scope of part.

This part states the policies and procedures for the following:

(a) Exemptions of alcohol products purchased for use by the VA medical care program from Federal excise taxes.

(b) Specified refund procedures for State and local taxes.

Subpart 829.2—Federal Excise Taxes

General exemptions.
Tax exemptions for alcohol products.

(a) General. (1) VA is permitted to procure spirits to be used for non-beverage purposes free of tax under the Alcohol and Tobacco Tax and Trade Bureau (TTB) regulations (see 27 CFR 19.538 and 19.539, 20.241 through 20.246, 22.161 and 22.162, 22.171 through 22.176, 24.293, and 25.181 through 25.185). The use of tax-free alcohol, whiskey, beer, wine, and denatured spirits for non-beverage purposes shall include, but is not limited to, medicinal and scientific purposes.

(2) The Executive Director and Chief Operating Officer, National Acquisition Center, and the Head of the Contracting Activity may sign application permits on Department of Treasury-TTB Form 5150.33, Spirits for Use of The United States. This authority may not be delegated.

(b) Whiskey, alcohol, and denatured alcohol. (1) The contracting officer may obtain application forms for tax-free purchases from the TTB Distribution Center, P.O. Box 5950, Springfield, VA 22150-5950. The completed forms must be submitted to the Associate Director (Compliance Operations), Alcohol and Tobacco Tax and Trade Bureau, Washington, DC 20226.

(2) Permits previously issued on Alcohol, Tobacco, and Firearms (ATF) Form 1444, Tax-Free Spirits for Use of United States, remain valid until surrendered or canceled. A copy of the current ATF Form 1444 or TTB Form 5150.33 must be made available to the supplier with the initial order. The permit number only needs to be referenced on any future orders with the same supplier.

(3) Contracting officers may make purchases of excise tax-free whiskey and alcohol only from qualified distillery plants or bonded dealers. The accountable officer must ensure that accurate records of all receipts, usage, and destruction of tax-free distilled spirits are maintained at each medical center and must conduct a semi-annual physical inventory of the tax-free alcohol in the possession of the medical center (see 27 CFR 22.161 and 22.162).

(c) Wine. No tax exemption form or ATF/TTB permit is required for the tax-free procurement of wine from bonded wine premises. The purchase order must show the kind, quantity, and alcohol content of the wine and must state the purpose for which wine is to be used (see 27 CFR 24.293). An extra copy of a properly executed purchase order may be furnished to the bonded wine premises from which wine is purchased to facilitate record keeping.

(d) Beer. The contracting officer may procure tax-free beer only from licensed breweries and only when such product is prescribed for patients' therapeutic use.

(1) The contracting officer must submit an application for a TTB permit to purchase tax-free beer in letter form to the Director of the nearest TTB Regional Office or to the Director, Alcohol and Tobacco Tax and Trade Bureau, Washington, DC 20226. The following information must be included:

(i) Name and address of facility.

(ii) Specific purpose for which the beer will be used.

(iii) Quantity proposed to buy each month, year, etc.

(iv) Name and address of brewery.

(v) Copy of document authorizing the head of the contracting activity to sign the request (i.e., paragraph (a)(2) of this section).

(2) The contracting officer must obtain a separate permit for each brewery from which beer is to be purchased.

Subpart 829.3—State and Local Taxes

Application of State and local taxes to the Government.

(a) If a vendor refuses to sell at a price exclusive of the State and local tax, the contracting officer must use Standard Form (SF) 1094, U.S. Tax Exemption Certificate, as a basis for billing taxing authorities for a refund of taxes paid.

(b) A contracting officer may not furnish an SF 1094 to a vendor or use SF 1094 to claim reimbursement from the taxing authority when the total amount of State and local tax on any one purchase is $10 or less.

Purchases made from patients' funds.

The contracting officer shall insert the clause at 852.229-70, Sales or Use Taxes, in solicitations and contracts when items are to be purchased solely from the personal funds of patients.

End Part Start Part

PART 831—CONTRACT COST PRINCIPLES AND PROCEDURES

Subpart 831.70—Contract Cost Principles and Procedures
831.7000
Scope of subpart.
831.7001
Allowable costs under cost reimbursement vocational rehabilitation and education contracts or agreements.
831.7001-1
Tuition.
831.7001-2
Special services or courses.
831.7001-3
Books, supplies, and equipment required to be personally owned.
831.7001-4
Medical services and hospital care.
831.7001-6
Consumable instructional supplies.
831.7001-7
Reimbursement for other supplies and services.
Start Authority

Authority: 38 U.S.C. 501; 40 U.S.C. 121(c); and 48 CFR 1.301-1.304.

End Authority

Subpart 831.70—Contract Cost Principles and Procedures

Scope of subpart.

This subpart contains general cost principles and procedures for the determination and allowance of costs in connection with the negotiation and administration of cost reimbursement type contracts for providing vocational rehabilitation, education, and training to eligible veterans under 38 U.S.C. Chapter 31, (referred to as a “Chapter 31 program”).

Allowable costs under cost reimbursement vocational rehabilitation and education contracts or agreements.
Tuition.

(a) Except as provided in this section, when the contractor has a customary cost of tuition, the charge to VA may not exceed that charged to similarly circumstanced nonveteran students. If the contractor has more than one standard charge for the same service, the charge to VA must be the lowest price that is offered or published for the entire course, semester, quarter, or term. Start Printed Page 2385

(b) VA will not normally pay tuition or incidental fees to institutions or establishments furnishing apprentice or other on-the-job training. VA may elect to pay charges or expenses that fall into either of the following categories:

(1) Charges customarily made by a nonprofit workshop or similar establishment for providing work adjustment training to similarly circumstanced nonveterans even if the trainee receives an incentive wage as part of the training.

(2) Training expenses incurred by an employer who provides on-the-job training following rehabilitation to the point of employability when VA determines that the additional training is necessary.

(c) When Federal funds pay the total cost of instruction or grants from the Federal Government pay a portion of the cost, (e.g. Smith-Hughes or other laws, excluding Federal Land Grant Funds), that subsidy will be taken into consideration in determining the charge to VA. The term “Federal Land Grant Funds” refers to those funds received under the Morrill-Nelson Act (Morrill Acts of 1862 and 1890 and the Nelson amendment of 1907) and section 22 of the Bankhead-Jones Act of 1935.

(d) A veteran who is participating in a Chapter 31 program and receives an award of a fellowship, scholarship, grant-in-aid, assistantship, or similar award will have that award treated according to the following requirements:

(1) If the award limits its use to payment of tuition, fees, or any charge that VA normally pays as part of a Chapter 31 program, VA will pay the portion of the charges remaining after applying the award.

(2) In all other cases, VA will pay the full amount of the tuition, fees, or other charges.

(e) If a State or other Government authority waives a veteran's tuition and fees, VA will reduce its payment of those charges by the amount of the waiver.

(f) VA will pay enrollment fees for registration if both of the following conditions exist:

(1) The institution or training establishment usually makes this charge.

(2) The charge is not more than other students or trainees pay.

Special services or courses.

Special services or courses are those services or courses that VA requests that are over and above those the institution customarily provides for similarly circumstanced nonveterans and that the contracting officer considers to be necessary for the rehabilitation of the trainee. VA will negotiate the costs of special services or courses before paying them.

Books, supplies, and equipment required to be personally owned.

(a) Reimbursement for supplies (including books, equipment, or other supplies) will be made as provided in this section.

(b) VA will provide reimbursement for those supplies that all students taking the same course or courses are customarily required to own personally. In addition, VA may provide reimbursement for items that the school does not specifically require for pursuit of the course, but that VA determines are needed because of the demands of the course, general possession by other students, and the disadvantage imposed on a veteran by not having the item. In no instance will VA provide reimbursement for supplies in a greater variety, quality, or amount than required of nonveteran students. In this instance, an item is not considered to be required if it is “requested” or “desirable to have” or “necessary for a future profession or job but not required by the institution of all students in the course”.

(c) When supplies are available in several prices, grades, or qualities, VA will provide reimbursement only for that quality or grade that will meet the requirements.

(d) Partial payment agreements, in which VA shares payment with the veterans, are not allowed.

(e) The institution's costs in connection with a veteran's thesis are considered supplies and are therefore authorized for reimbursement if the veteran's committee chairman, major professor, department head, or appropriate dean certifies that the thesis is a course requirement and the expenses are required to complete the thesis. These expenses may include research expenses, typing, printing, microfilming, or otherwise reproducing the required number of copies.

(f) When the institution operates a bookstore or supply store for all students, reimbursement to the bookstore or supply store for supplies issued to trainees will be no greater than charges made to nonveteran students.

(g) When the institution, training establishment, or employer arranges for stores or other non-institutionally owned establishments to issue supplies to all students and a veteran is to pay the store or establishment for supplies issued to trainees, VA will provide reimbursement for those charges if they are no greater than those nonveterans pay or paid to the institutions, whichever is the lesser.

(h) Supplies that the institution purchases specifically for trainees will be reimbursed at the net cost to the institution.

(i) When the institution does not provide or arrange for issuance of generally required books, tools and supplies for students attending the facility, the institution, in cooperation with VA, may designate certain stores and establishments to provide generally required books, tools and supplies for veterans pursuing a vocational rehabilitation program. The vendor will be reimbursed in the same manner as for supplies provided or arranged for by the institutions.

(j) When it is customary in a survey class to permit each student to rent books for the subject (commonly referred to as a rental set), and the student is not required to own the books/materials, reimbursement is authorized for the rental charge as long as it does not exceed the charge made to nonveteran students.

(k) Educational and training institutions that furnish supplies to trainees that all students pursuing the same or similar course are required to own personally or obtain may be compensated for furnishing the supplies in an amount not exceeding 10 percent of the allowable charge for the supplies furnished or rented subject to the following conditions:

(1) When the tuition covers the charges for supplies or rentals or a stipulated fee is assessed to all students, handling charges are not allowable.

(2) The handling charge is not allowable for Government-owned books that the institution procures from the Library of Congress.

Medical services and hospital care.

(a) VA may pay the customary student health fee when payment of the fee is required for similarly circumstanced nonveterans. If payment of the fee is not required for similarly circumstanced nonveterans, payment may be made if it is determined by the Veterans Health Administration that payment is in the best interest of the veteran and the Government.

(b) When the customary student's health fee does not cover medical services or hospital care, but these medical services are available in a school-operated facility or with doctors and hospitals in the immediate area through a prior arrangement, the Veterans Benefits Administration may provide reimbursement for these services in a contract for the services if: Start Printed Page 2386

(1) An arrangement is necessary to provide timely medical services for veterans attending the facility under provisions of Chapter 31; and

(2) The general rates established for medical services do not exceed the rates established by the Under Secretary for Health.

(c) VA may reimburse a rehabilitation facility for incidental medical services provided during a veteran's program at the facility.

Consumable instructional supplies.

(a) VA will provide reimbursement for consumable instructional supplies that the institution require for the instruction of all students, veteran or nonveteran, pursuing the same or comparable course or courses when:

(1) The supplies are entirely consumed in the fabrication of a required project; or

(2) The supplies are not consumed but are of such a nature that they cannot be salvaged from the end product for reuse by disassembling or dismantling the end product.

(b) VA will not provide reimbursement for consumable instructional supplies if any of the following apply:

(1) The supplies can be salvaged for reuse.

(2) The supplies are used in a project that the student has elected as an alternate class project to produce an end product of greater value than that normally required to learn the skills of the occupation and the end product will become the veteran's property upon completion.

(3) The supplies are used in a project that the institution has selected to provide the student with a more elaborate end product than is required to provide adequate instruction as an inducement to the veteran to elect a particular course of study.

(4) The sale value of the end product is equal to or greater than the cost of supplies plus assembly, and the supplies have not been reasonably used so that the supplies are not readily salvaged from the end product to be reused for instructional purposes.

(5) The end product is of permanent value and retained by the institution.

(6) A third party loans the articles or equipment for repair or improvement and the third party would otherwise pay a commercial price for the repair or improvement.

(7) The number of projects resulting in end products exceeds the number normally required to teach the recognized job operations and processes of the occupation stipulated in the approved course of study.

(8) The cost of supplies is included in the charge for tuition or as a fee designated for such purpose.

Reimbursement for other supplies and services.

VA will provide reimbursement for other services and assistance that may be authorized under provisions of applicable Chapter 31 regulations, including, but not limited to, employment and self-employment services, initial and extended evaluation services, and independent living services.

End Part Start Part

PART 832—CONTRACT FINANCING

832.006
Reduction or suspension of contract payments upon finding of fraud.
832.006-1
General.
832.006-2
Definitions.
832.006-3
Responsibilities.
832.006-4
Procedures.
Subpart 832.1—Non-Commercial Item Purchase Financing
832.111
Contract clauses for non-commercial purchases.
Subpart 832.2—Commercial Item Purchase Financing
832.201
Statutory authority.
832.202
General.
832.202-1
Policy.
832.202-4
Security for Government financing.
Subpart 832.4—Advance Payments for Non-Commercial Items
832.402
General.
832.404
Exclusions.
Subpart 832.5—Progress Payments Based on Costs
832.502
Preaward matters.
832.502-2
Contract finance office clearance.
Subpart 832.8—Assignment of Claims
832.805
Procedure.
832.805-70
Distribution/notification of assignment of claims.
Subpart 832.9—Prompt Payment
832.904
Determining payment due dates.
Subpart 832.11—Electronic Funds Transfer
832.1106
EFT mechanisms.
Start Authority

Authority: 40 U.S.C. 121(c) and 48 CFR 1.301-1.304.

End Authority
Reduction or suspension of contract payments upon finding of fraud.
General.

The SPE is authorized to make determinations that there is substantial evidence that contractors' requests for advance, partial, or progress payments are based on fraud and may direct that further payments to the contractors be reduced or suspended, as provided in FAR 32.006. This authority may not be redelegated.

Definitions.

The remedy coordination official for VA is the DSPE.

Responsibilities.

VA personnel must report suspected fraud related to advance, partial, or progress payments to the DSPE and VA Office of Inspector General. The report must include all available information supporting the suspicion.

Procedures.

(a) Any recommendation from a VA employee through the DSPE to the SPE to reduce or suspend payment to a contractor under FAR 32.006 must address the considerations in FAR 32.006-4(d).

(b) The DSPE shall carry out the responsibilities of the Secretary or designee in FAR 32.006-4(e) to notify the contractor of proposed action under FAR 32.006. The notice of proposed action will be sent to the last known address of the contractor, the contractor's counsel, or agent for service of process, by certified mail, return receipt requested, or any other method that provides signed evidence of receipt. In the case of a business, the notice of proposed action may be sent to any partner, principal, officer, director, owner or co-owner, or joint venture. The contractor will be afforded an opportunity to appear before the DSPE to present information or argument in person or through a representative. The contractor may supplement the oral presentation with written information and argument. The proceedings will be conducted in an informal manner and without the requirement for a transcript. If the DSPE does not receive a reply from the contractor within 30 calendar days, the DSPE will base his or her recommendations on the information available. Any recommendation of the DSPE under paragraph (a) of this section must address the results of this notification and the information, if any, provided by the contractor.

(c) The SPE must provide a copy of each final determination and the supporting documentation to the contractor, the DSPE and the contracting officer. The contracting officer will place a copy of the determination and the supporting documentation in the contract file.

Subpart 832.1—Non-Commercial Item Purchase Financing

Contract clauses for non-commercial purchases.

In solicitations and contracts for construction that include the FAR clause at 52.232-5, Payments under Start Printed Page 2387Fixed-Price Construction Contracts, the contracting officer must insert the following clauses:

(a) If the solicitation or contract does not contain a section entitled “Network Analysis System (NAS),” the contracting officer must insert the clause at 852.236-82, Payments under Fixed-Price Construction Contracts (Without NAS). When the solicitation or contract includes guarantee period services, the contracting officer must use the clause with its Alternate I.

(b) If the solicitation or contract contains a section entitled “Network Analysis System (NAS),” the contracting officer must insert the clause at 852.236-83, Payments under Fixed-Price Construction Contracts (Including NAS). When the solicitation or contract includes guarantee period services, the contracting officer must use the clause with its Alternate I.

Subpart 832.2—Commercial Item Purchase Financing

Statutory authority.

The contracting officer may make the determination that terms and conditions for payment for commercial items are appropriate and customary in the commercial marketplace and are in the best interest of the Government, provided the terms and conditions for payment do not conflict with FAR Subpart 32.2.

General.
Policy.

As provided in FAR 32.202-1(d), contracting officers must obtain the approval of the DSPE before awarding a contract that includes unusual contract financing. The contracting officer must fully support the request with the reasons why the proposed unusual contract financing is in the best interest of the Government. In addition, contracting officers must not use commercial interim payment or commercial advance payment terms in solicitations or contracts without the approval of the DSPE.

Security for Government financing.

An offeror's financial condition may be considered adequate security to protect the Government's interest when the Government provides contract financing. In assessing the offeror's financial condition, the contracting officer may obtain, to the extent required, the following information to establish the offeror's financial capability and to determine the offeror's financial condition:

(a) A current year interim balance sheet and income statement and balance sheets and income statements for the two preceding fiscal years. The statements should be prepared in accordance with generally accepted accounting principles and must be audited and certified by an independent public accountant or an appropriate officer of the firm.

(b) A cash flow forecast for the remainder of the contract term showing the planned origin and use of cash within the firm or branch performing the contract.

(c) Information on financing arrangements disclosing the availability of cash to finance contract performance, the contractor's exposure to financial crisis, and credit arrangements.

(d) A statement of the status of all State, local, and Federal tax accounts, including any special mandatory contributions.

(e) A description and explanation of the financial effects of any leases, deferred purchase arrangements, patent or royalty arrangements, insurance, planned capital expenditures, pending claims, contingent liabilities, and other financial aspects of the business.

(f) Any other financial information deemed necessary.

(g) A Dun and Bradstreet Report on the company.

Subpart 832.4—Advance Payments for Non-Commercial Items

General.

Authority to make the determination required by FAR 32.402(c)(1)(iii) and to approve contract terms, as provided by FAR 32.402(e)(1), is delegated to the SPE and is further delegated to the DSPE. Before award, contracting officers must submit a request for approval to use advance payment to the DSPE. The request must include the information required by FAR 32.409-1 and must address the standards for advance payment in FAR 32.402(c)(2).

Exclusions.

(a) Under 31 U.S.C. 3324(d)(2), VA allows advance payment for subscriptions or other charges for newspapers, magazines, periodicals, and other publications for official use, notwithstanding the provisions of 31 U.S.C. 3324(a). The term “other publications” includes any publication printed, microfilmed, photocopied or magnetically or otherwise recorded for auditory or visual use.

(b) Under 31 U.S.C. 1535, VA allows advance payment for services and supplies obtained from another Government agency.

(c) Under 5 U.S.C. 4109, VA allows advance payment for all or any part of the necessary expenses for training Government employees in Government or non-Government facilities, including the purchase or rental of books, materials, and supplies or services directly related to the training of a Government employee.

Subpart 832.5—Progress Payments Based on Costs

Preaward matters.
Contract finance office clearance.

Contracting officers must obtain approval from the DSPE before taking the actions listed in FAR 32.502-2. Full justification and the recommendations of the contracting officer must accompany requests for approval.

Subpart 832.8—Assignment of Claims

Procedure.
Distribution/notification of assignment of claims.

(a) The contracting officer must:

(1) File the retained copy of the notice of assignment and the certified copy of the original instrument of assignment with the Government Accountability Office copy of the contract; and

(2) Forward a copy of the notice of assignment and instrument of assignment to the local finance office and to the payment office cited in the contract.

(b) Contracting officers must notify field facilities of any recognized assignment of payments for contracts under which payment for articles and services is certified and approved for payment in the field.

Subpart 832.9—Prompt Payment

Determining payment due dates.

(a) When preparing specification packages, contracting officers must give full consideration to the time reasonably required for constructive acceptance or approval of the goods or services and for making invoice payments. Based on this analysis, contracting officers may, when authorized by FAR 32.904, modify the number of days allowed for notifying contractors of defects in invoices or, for construction solicitations, the number of days allowed for payment of invoices specified in the applicable prompt payment clause. Changes, if any, should be made before issuing the solicitation.

(b)(1) For construction solicitations, the analysis specified in paragraph (a) of this section may routinely take more than the 7 days provided in paragraph (a)(2) of the FAR clause at 52.232-27, Start Printed Page 2388Prompt Payment for Construction Contracts, to evaluate and return defective progress payment invoices.

(2) It also may take more than the 14 days provided in paragraph (a)(1)(i)(A) of the prompt payment clause to adequately inspect the work, determine the adequacy of the contractor's performance, approve, and pay progress payment invoices.

(3) Contracting officers should consider the following and, if necessary, revise the number of days stated in paragraphs (a)(2) and (a)(1)(i)(A) of the prompt payment clause before issuing construction solicitations (see FAR 32.904(d)(1)(i)):

(i) Recent interest payment history.

(ii) The complexity of the project.

(iii) Workload.

(iv) Work site location.

(4) In no event may the number of days be set in excess of 14 days for return of a defective progress payment invoice or 30 days for payment of the invoice.

Subpart 832.11—Electronic Funds Transfer

EFT mechanisms.

(a) The Assistant Secretary for Management may, with the concurrence of the Department of the Treasury office responsible for making payment, authorize the use of EFT mechanisms other than those authorized under FAR 32.1106(a).

(b) The Assistant Secretary for Management may, with the concurrence of the Department of the Treasury office responsible for making payment, authorize the use of EFT for payments to be received by or on behalf of a contractor outside the United States or Puerto Rico or for contracts paid in other than United States currency, as provided in FAR 32.1106(b).

End Part Start Part

PART 833—PROTESTS, DISPUTES, AND APPEALS

Subpart 833.1—Protests
833.102
General.
833.103
Protests to VA.
833.104
Protests to GAO.
833.106
Solicitation provision and contract clause.
Subpart 833.2—Disputes and Appeals
833.209
Suspected fraudulent claims.
833.211
Contracting officer's decision.
833.212
Contracting officer's duties upon appeal.
833.213
Obligation to continue performance.
833.214
Alternative dispute resolution (ADR).
833.215
Contract clause.
Start Authority

Authority: 40 U.S.C. 121(c) and 48 CFR 1.301-1.304.

End Authority

Subpart 833.1—Protests

General.

Solicitations must instruct interested parties (see FAR provision 52.233-2) to send a copy of any protest filed with the Government Accountability Office (GAO) to the contracting officer and the appropriate VA Central Office activity as follows:

(a) For contracts to be awarded by the Office of Facilities Management: Chief Facilities Management Officer, Office of Facilities Management, Department of Veterans Affairs, 810 Vermont Avenue, NW., Washington, DC 20420.

(b) For all other contracts: Deputy Assistant Secretary for Acquisition and Materiel Management, Department of Veterans Affairs, 810 Vermont Avenue, NW., Washington, DC 20420.

Protests to VA.

(a) Filing of protests. (1) An interested party may protest to the contracting officer or, as an alternative, may request an independent review by filing a protest with the DAS for A&MM, or for solicitations issued by the Office of Facilities Management, the Chief Facilities Management Officer, Office of Facilities Management. A protest filed with the DAS for A&MM or the Chief Facilities Management Officer will not be considered if the interested party has a protest on the same or similar issues pending with the contracting officer.

(2) Protests to the contracting officer must be in writing and addressed where offer/bid is to be submitted.

(3) Protests requesting an independent review must be in writing and addressed to the Deputy Assistant Secretary for Acquisition and Materiel Management, Department of Veterans Affairs, 810 Vermont Avenue, NW., Washington, DC 20420; or, for solicitations issued by the Office of Facilities Management, to the Chief Facilities Management Officer, Office of Facilities Management, Department of Veterans Affairs, 810 Vermont Avenue, NW., Washington, DC 20420.

(4) The following types of protests may be dismissed by VA without consideration of the merits or forwarded to another agency for appropriate action.

(i) Contract administration. Disputes between a contractor and VA are resolved under the disputes clause of the contract and the Contract Disputes Act of 1978. (41 U.S.C. 601-613).

(ii) Small business size standards and standard industrial classification. Challenges of established size standards or the size status of particular firms, and challenges of the selected standard industrial classification are for review solely by the Small Business Administration. (15 U.S.C. 637(b)(6); 13 CFR 121.1002).

(iii) Small business certificate of competency program. A protest made under section 8(b)(7) of the Small Business Act, or in regard to any issuance of a certificate of competency or refusal to issue a certificate under that section, is not reviewed in accordance with bid protest procedures unless there is a showing of possible fraud or bad faith on the part of Government officials.

(iv) Protests under section 8(a) of the Small Business Act. The decision to place or not to place a procurement under the 8(a) program is not subject to review unless there is a showing of possible fraud or bad faith on the part of Government officials or that regulations may have been violated. (15 U.S.C. 637(a)).

(v) Affirmative determination of responsibility by the Contracting Officer. An affirmative determination of responsibility will not be reviewed unless there is a showing that such determination was made fraudulently or in bad faith or that definitive responsibility criteria in the solicitation were not met.

(vi) Walsh-Healey Public Contract Act. Challenges of the legal status of a firm as a regular dealer or manufacturer within the meaning of the Walsh-Healey Act is determined solely by the procuring agency, the Small Business Administration (if a small business is involved), and the Secretary of Labor. (41 U.S.C. 35-45).

(vii) Subcontractor protests. The contracting agency will not consider subcontractor protests except where the subcontract is by or for the Government.

(viii) Judicial proceedings. The contracting agency will not consider protests where the matter involved is the subject of litigation before a court of competent jurisdiction.

(b) Alternative dispute resolution. Bidders/offerors and VA contracting officers are encouraged to use alternative dispute resolution (ADR) procedures to resolve protests at any stage in the protest process. The VA Board of Contract Appeals (VABCA) is an independent and neutral entity within VA and is available to serve as the third-party neutral (Neutral) for bid protests. If ADR is used, VA will not furnish any documentation in an ADR proceeding beyond what is allowed by the FAR.

(c) Action upon receipt of protest. For protests filed with the contracting officer, the HCA will be the approving official for the determinations identified in FAR 33.103(f)(1) and (f)(3). If the HCA is also the contracting officer, the Start Printed Page 2389approving official will be the DAS for A&MM. For protests filed with the DAS for A&MM or the Chief Facilities Management Officer, Office of Facilities Management, those individuals will be the approving officials for the determinations identified in FAR 33.103(f)(1) and (f)(3).

(d) Requests for GAO advance decisions. When a written protest has been filed with the contracting officer and the contracting officer considers it desirable to do so, the contracting officer may request an advance decision from the Comptroller General. The contracting officer must send the submission to the Comptroller General through the DAS for A&MM or the Chief Facilities Management Officer, Office of Facilities Management, as appropriate, and must include the material listed in FAR 33.104(a). The contracting officer must promptly notify the protesting individual or firm in writing of the decision of the Comptroller General.

(e) Protest after award. When a written protest is filed with the contracting officer after contract award, the following requirements apply:

(1) If FAR 33.103(f)(3) requires suspension of contract performance, the contracting officer must seek to obtain a mutual agreement with the contractor to suspend performance on a no-cost basis. If unsuccessful, the contracting officer must issue a stop-work order in accordance with contract clause FAR 52.233-3, Protest after Award.

(2) If suspension of contract performance is not required by FAR 33.103(f)(3) and if the contracting officer determines that the award was proper, the contracting officer must furnish the protester a written explanation of the basis for the award that is responsive to the allegations of the protest. The contracting officer will advise the protester that the protester may appeal the determination to one of the following:

(i) The DAS for A&MM.

(ii) The Chief Facilities Management Officer, Office of Facilities Management, in the case of a contract awarded by the Office of Facilities Management.

(iii) The Comptroller General.

(3) If suspension of contract performance is not required by FAR 33.103(f)(3) but the contracting officer determines that the award is questionable, the contracting officer, after consulting with OGC, will advise the contractor of the protest and invite the contractor to submit comments and relevant information. The contracting officer must submit the case promptly to the DAS for A&MM, for advice. The DAS for A&MM may consult with OGC and will either advise the contracting officer of the appropriate action to take, or submit the case to the Comptroller General, through the Assistant Secretary for Management, for a decision. The contracting officer will provide interested parties with a copy of the final decision.

(f) Agency appellate review of the contracting officer's protest decision. An interested party may request an independent review of a contracting officer's protest decision by filing an appeal with the DAS for A&MM or, for solicitations issued by the Office of Facilities Management, with the Chief Facilities Management Officer, Office of Facilities Management. To be considered timely, the appeal must be received by the appropriate officer named in this paragraph within 10 calendar days of the date the interested party knew, or should have known, whichever is earlier, of the basis for the appeal. Appeals must be addressed as provided in paragraph (a)(2) of this section. Appeals do not extend GAO's timeliness requirements for appeals to GAO. By filing an appeal as provided in this paragraph, an interested party may waive its rights to further appeal to the Comptroller General at a later date. Agency responses to appeals submitted to the agency shall be reviewed and concurred in by OGC (025).

Protests to GAO.

(a) General procedures. (1) Procedures for protests to the Government Accountability Office (GAO) are at 4 CFR Part 21 (GAO Bid Protest Regulations). If guidance concerning GAO procedure in this section differs from 4 CFR Part 21, 4 CFR Part 21 applies.

(2) When a protest before or after award has been filed with GAO, the contracting officer must submit a report to the DAS for A&MM, or the Chief Facilities Management Officer, Office of Facilities Management, as appropriate, within 5 workdays after receipt of verbal or written notice of the protest, whichever occurs first. The report must include a copy of the documentation indicated in FAR 33.104(a)(3).

(3) Contracting officers are responsible for the notification procedures outlined in FAR 33.104(a)(4).

(b) Protests before award. When VA receives notice from GAO of a pre-award protest filed directly with GAO, award will normally not be made until the matter is resolved. However, award may be made despite the protest if the DAS for A&MM, or the Chief Facilities Management Officer, Office of Facilities Management, as appropriate, approves the findings of the HCA required by FAR 33.104(b)(1) and GAO has been notified as provided by FAR 33.104(b)(2). The Director, Acquisition Resources Service, or the Chief Facilities Management Officer, as appropriate, is responsible for notifying GAO.

(c) Protests after award. When, after award of a contract, VA receives notice from GAO of a protest filed directly with GAO, the contracting officer must, if required to do so by FAR 33.104(c)(1), immediately suspend performance. However, contract performance need not be suspended, despite the protest, if the SPE approves the HCA's findings required by FAR 33.104(c)(2) and GAO has been notified under FAR 33.104(c)(3). Authority to approve the HCA's findings is further delegated to the DSPE and, for solicitations issued by the Officer of Facilities Management, the Chief Facilities Management Officer. The Director, Acquisition Resources Service, or the Chief Facilities Management Officer, as appropriate, is responsible for notifying GAO.

Solicitation provisions.

(a) The contracting officer will insert the provision at 852.233-70, Protest Content/Alternative Disputes Resolution, in each solicitation expected to exceed the simplified acquisition threshold.

(b) The contracting officer must insert the provision at 852.233-71, Alternative Protest Procedure, in solicitations expected to exceed the simplified acquisition threshold.

Subpart 833.2—Disputes and Appeals

Suspected fraudulent claims.

The contracting officer must refer matters relating to suspected fraudulent claims to the Office of Inspector General for investigation and referral to the Department of Justice. The contracting officer may not initiate any collection, recovery, or other settlement action while the matter is in the hands of the Department of Justice without first obtaining the concurrence of the U.S. Attorney concerned, through the Office of Inspector General.

Contracting officer's decision.

(a) When a dispute cannot be settled by agreement and a final decision under the Disputes clause of the contract is necessary, the contracting officer must furnish the contractor the contracting officer's final decision in the matter.

(b) The contracting officer must identify the decision, in writing, as a final decision and include a statement of facts in sufficient detail to enable the contractor to fully understand the Start Printed Page 2390decision and the basis on which it was made. The decision must set forth those facts relevant to the dispute with which the contractor and the contracting officer are in agreement, and as clearly as possible, the area of disagreement.

(c) The decision shall, in addition to the material required by FAR 33.211(a)(4), contain the following statement:

The VA Board of Contract Appeals (VABCA) is the authorized representative of the Secretary for hearing and determining such disputes. The rules of the VABCA are published in section 1.783 of title 38, Code of Federal Regulations. The address of the Board is: VA Board of Contract Appeals (09), 810 Vermont Avenue, NW., Washington, DC 20420.

Contracting officer's duties upon appeal.

(a) When a contracting officer receives notice of appeal in any form, the contracting officer must do the following:

(1) Annotate the appeal with the date of mailing (or date of receipt, if otherwise conveyed).

(2) Within 10 days, forward the original notice of appeal and a copy of the contracting officer's final decision letter to the VABCA.

(3) Concurrently transmit copies of the notice of appeal and the final decision letter to the DAS for A&MM and OGC. (In cases of construction contracts administered by the Office of Facilities Management, copies of the appeal and the final decision letter need not be transmitted to the DAS for A&MM but instead should be sent to the Chief Facilities Management Officer.)

(b) Within 20 days of receipt of an appeal, or advice that an appeal has been filed, the contracting officer must assemble and transmit to the VABCA, through OGC, an appeal file consisting of all documents pertinent to the appeal, including all of the following:

(1) The decision and findings of fact that are being appealed.

(2) The contract, including specifications and pertinent amendments, plans and drawings.

(3) All correspondence between the parties pertinent to the appeal, including the letter or letters of claim in response to which the decision was issued.

(4) Transcripts of any testimony taken during the course of proceedings and affidavits or statements of any witnesses on the matter in dispute made prior to the filing of the notice of appeal with the VABCA.

(5) Any additional information considered pertinent.

Obligation to continue performance.

(a) As provided in FAR 33.213, contracting officers shall use FAR clause 52.233-1, Disputes, with its Alternate I. Clause 52.233-1 requires the contractor to continue performance in accordance with the contracting officer's decision in the event of a claim arising under a contract. Alternate I expands this authority, adding a requirement for the contractor to continue performance in the event of a claim relating to the contract.

(b) In the event of a dispute not arising under, but relating to, the contract, if the contracting officer directs continued performance, the contracting officer may consider providing financing for the continued performance, provided, that the Government's interests are properly secured. The contracting officer will contact the DAS for A&MM and OGC for advice prior to authorizing such financing.

Alternative dispute resolution (ADR).

(a) Contracting officers and contractors are encouraged to use alternative dispute resolution (ADR) procedures, by using VA's ADR Program, to resolve contract disputes before they become appealable disputes.

(b) Under VA's ADR Program, the Chair of the VA Board of Contract Appeals (VABCA or Board), who is VA's Dispute Resolution Specialist, will appoint a Board member (at no cost to either party) to serve as a Neutral to aid in resolving matters before the matters become appealable disputes. The administrative judges are trained Neutrals and are available to assist in ADR proceedings.

(c) In the event a Board member serves as a Neutral in a matter that is not resolved using ADR, that Board member will keep all discussions confidential until the matter is finally resolved and may, at the request of either party involved, have no further input or contact with the parties or other Board members in subsequent Board activities relating to the dispute (ref. the Administrative Dispute Resolution Act, 5 U.S.C. 571-583; and FAR 33.214).

(d) Contracting officers and contractors are also encouraged to use ADR in disputes that have already been appealed to the VABCA.

Contract clause.

The contracting officer must use the clause at 52.233-1, Disputes, with its Alternate I (see 833.213).

End Part

Subchapter F—Special Categories of Contracting

Start Part

PART 836—CONSTRUCTION AND ARCHITECT-ENGINEER CONTRACTS

Subpart 836.2—Special Aspects of Contracting for Construction
836.202
Specifications.
836.203
Government estimate of construction costs.
836.204
Disclosure of the magnitude of construction projects.
836.206
Liquidated damages.
836.209
Construction contracts with architect-engineer firms.
836.213
Special procedures for sealed bidding in construction contracting.
836.213-4
Notice of award.
836.213-70
Notice to proceed.
Subpart 836.5—Contract Clauses
836.500
Scope of subpart.
836.501
Performance of work by the contractor.
836.513
Accident prevention.
836.521
Specifications and drawings for construction.
836.570
Correspondence.
836.571
Reference to “standards.”
836.572
Government supervision.
836.573
Daily report of workers and materials.
836.574
Subcontracts and work coordination.
836.575
Schedule of work progress.
836.576
Supplementary labor standards provisions.
836.577
Worker's compensation.
836.578
Changes—supplement.
836.579
Special notes.
Subpart 836.6—Architect-Engineer Services
836.602
Selection of firms for architect-engineer contracts.
836.602-1
Selection criteria.
836.602-2
Evaluation boards.
836.602-4
Selection authority.
836.602-5
Short selection process for contracts not to exceed the simplified acquisition threshold.
836.603
Collecting data on and appraising firms qualifications.
836.606
Negotiations.
836.606-70
General.
836.606-71
Architect-engineer's proposal.
836.606-72
Contract price.
836.606-73
Application of 6 percent architect-engineer fee limitation.
Start Authority

Authority: 40 U.S.C. 121(c) and 48 CFR 1.301-1.304.

End Authority

Subpart 836.2—Special Aspects of Contracting for Construction

Specifications.

(a) The procedures described in Part 811 are applicable to construction specifications.

(b) During the design stage, contract architect-engineers must not use “brand name or equal” or other restrictive specifications without the prior written approval of the contracting officer. The Start Printed Page 2391contracting officer must inform prospective architect-engineers of this requirement during the negotiation phase, prior to award of a contract for design.

(c) If VA has determined that only one product will meet the Government's minimum needs and VA will not allow the submission of “equal” products, the contracting officer must include the clause found at 852.236-90, Restriction on Submission and Use of Equal Products, in the solicitation and complete the clause by listing the items to which the clause applies. This clause places bidders on notice that the “brand name or equal” provisions of the clause found at FAR 52.236-5, Materials and Workmanship, and any other provision that may authorize the submission of an “equal” product, will not apply to the specific items listed.

Government estimate of construction costs.

The overall amount of the Government estimate must not be disclosed until after award of the contract. After award, the contracting officer may disclose the overall amount upon request.

Disclosure of the magnitude of construction projects.

In lieu of the estimated price ranges described in FAR 36.204, the contracting officer must identify the magnitude of a VA project in advance notices and solicitations in terms of one of the following price ranges:

(a) Less than $25,000.

(b) Between $25,000 and $100,000.

(c) Between $100,000 and $250,000.

(d) Between $250,000 and $500,000.

(e) Between $500,000 and $1,000,000.

(f) Between $1,000,000 and $2,000,000.

(g) Between $2,000,000 and $5,000,000.

(h) Between $5,000,000 and $10,000,000.

(i) Between $10,000,000 and $20,000,000.

(j) Between $20,000,000 and $50,000,000.

(k) Between $50,000,000 and $100,000,000.

(l) More than $100,000,000

Liquidated damages.

The contracting officer may include a liquidated damages provision in a construction contract when the criteria of FAR 11.501 and 811.501 are met. If partial performance may be accepted and used to the advantage of the Government, the contracting officer must include the clause substantially as set forth in 852.211-74, Liquidated Damages, in addition to the clause set forth in FAR 52.211-12.

Construction contracts with architect-engineer firms.

(a) When the contracting officer considers it necessary or advantageous to award a contract for construction of a design-bid-build project, as defined at FAR 36.102, to a firm or person that designed the project, the contracting officer must request prior approval from one of the following:

(1) The facility or VISN director, as appropriate, or, for National Cemetery Administration contracts, the Director, Technical Support Service, for contracts involving nonrecurring maintenance (NRM) funds.

(2) The Chief Facilities Management Officer, Office of Facilities Management, for contracts involving construction funds.

(b) The contracting officer must furnish complete justification in the request.

(c) This section does not apply to design-build contracts, as defined at FAR 36.102.

Special procedures for sealed bidding in construction contracting.
Notice of award.

The contracting officer must provide to the contractor a notice of award (letter of acceptance) for any contract award in excess of $25,000.

Notice to proceed.

(a) The contracting officer must provide construction contractors with a written notice to proceed with the work. A notice to proceed will normally be sent only after the contractor has provided performance and payment bonds or payment protection and the completed contract forms, where applicable, and the contracting officer has accepted them. If the urgency of the work or other proper reason requires the contractor to begin work immediately, the contracting officer may include in the award letter a notice to proceed, with the reservation that payments are contingent upon receipt and approval of the required bonds or payment protection.

(b) If the contract provides for liquidated damages, the contracting officer must send the notice to proceed by certified mail, return receipt requested, or any other method that provides signed evidence of receipt. The notice to proceed will advise the contractor that the work must be completed within___ (insert contract time for completion) calendar days from the date of receipt shown on the certified mail receipt card returned by the post office or on the proof of delivery provided by the delivery service.

(c) If the contract does not provide for liquidated damages, certified mail is not required. In notices to proceed for these contracts, the contracting officer must establish a date for completion that takes into consideration the time required for the notice to arrive by regular mail.

(d) At the time the notice to proceed is sent to the contractor, the contracting officer must furnish a copy to the resident engineer or the Chief, Engineering Service.

(e) The contracting officer must file a copy of the notice to proceed with copy A of the contract. When certified mail or other method of certified delivery is used, the contracting officer must attach the certified mail receipt card returned by the post office or the proof of delivery provided by the delivery service to the copy of the notice to proceed. The contracting officer must file copies of the notice to proceed with copies C and D of the contract after the date of receipt has been established and indicated on the notice to proceed.

Subpart 836.5—Contract Clauses

Scope of subpart.

(a) The clauses and provisions prescribed in this subpart are set forth for use in fixed-price construction contracts in addition to those in FAR Subpart 52.2.

(b) Additional clauses and provisions not inconsistent with those in FAR Subparts 36.5 and 52.2 and those prescribed in this subpart are authorized when determined necessary or desirable by the contracting officer, and when approved as provided in Subpart 801.4.

(c) Clauses and provisions that differ from those contained in FAR Subparts 36.5 and 52.2 and this subpart, but considered essential to the procurement of VA requirements, shall not be used unless the deviation procedure set forth in Subpart 801.4 has been complied with.

Performance of work by the contractor.

The contracting officer must insert the clause at 852.236-72, Performance of Work by the Contractor, in solicitations and contracts for construction that contain the FAR clause at 52.236-1, Performance of Work by the Contractor. When the solicitations or contracts include a section entitled “Network Analysis System (NAS),” the contracting officer must use the clause with its Alternate I.

Start Printed Page 2392
Accident prevention.

The contracting officer must insert the clause at 852.236-87, Accident Prevention, in solicitations and contracts for construction that contain the clause at FAR 52.236-13, Accident Prevention.

Specifications and drawings for construction.

The contracting officer must insert the clause at 852.236-71, Specifications and Drawings for Construction, in solicitations and contracts for construction that include the FAR clause at 52.236-21, Specifications and Drawings for Construction.

Correspondence.

The contracting officer must insert the clause at 852.236-76, Correspondence, in solicitations and contracts for construction expected to exceed the micro-purchase threshold for construction (currently $2,000).

Reference to “standards.”

The contracting officer must insert the clause at 852.236-77, Reference to “Standards,” in solicitations and contracts for construction expected to exceed the micro-purchase threshold for construction.

Government supervision.

The contracting officer must insert the clause at 852.236-78, Government Supervision, in solicitations and contracts for construction expected to exceed the micro-purchase threshold for construction.

Daily report of workers and materials.

The contracting officer must insert the clause at 852.236-79, Daily Report of Workers and Materials, in solicitations and contracts for construction expected to exceed the simplified acquisition threshold. The contracting officer may, when in the best interest of the Government, insert the clause in solicitations and contracts for construction when the contract amount is expected to be at or below the simplified acquisition threshold.

Subcontracts and work coordination.

The contracting officer must insert the clause at 852.236-80, Subcontracts and Work Coordination, in solicitations and contracts for construction expected to exceed the micro-purchase threshold for construction. When the solicitations or contracts are for new construction work with complex mechanical-electrical work, the contracting officer may use the clause with its Alternate I.

Schedule of work progress.

The contracting officer must insert the clause at 852.236-84, Schedule of Work Progress, in solicitations and contracts for construction that are expected to exceed the micro-purchase threshold for construction and that do not contain a section entitled “Network Analysis System (NAS).”

Supplementary labor standards provisions.

The contracting officer must insert the clause at 852.236-85, Supplementary Labor Standards Provisions, in solicitations and contracts for construction that are expected to exceed the micro-purchase threshold for construction.

Worker's compensation.

The contracting officer must insert the clause at 852.236-86, Worker's Compensation, in solicitations and contracts for construction that are expected to exceed the micro-purchase threshold for construction.

Changes—supplement.

(a) The contracting officer must insert the clause at 852.236-88, Contract Changes—Supplement, in solicitations and contracts for construction that are expected to exceed the micro-purchase threshold for construction. (This section has been promulgated as a deviation from the FAR as provided in 801.4.)

(b) When negotiated changes exceed $500,000, paragraph (a) of the clause at 852.236-88 will apply. Because paragraph (a) does not provide ceiling rates for indirect expenses, the contractor must furnish cost breakdowns and other supporting data on its rates for indirect expenses as part of its price proposal. The contracting officer must negotiate the rates for indirect expenses with the contractor and may request an audit in accordance with FAR 15.404-2.

(c) When the negotiated change will be $500,000 or less, paragraph (b) of the clause at 852.236-88 will apply. Because the indirect cost rates in paragraph (b) of the clause at 852.236-88 are ceiling rates, the contracting officer must negotiate indirect expense rates within the ceiling limitations.

Special notes.

The contracting officer must insert the clause at 852.236-91, Special Notes, in solicitations and contracts for construction that are expected to exceed the micro-purchase threshold for construction.

Subpart 836.6—Architect-Engineer Services

Selection of firms for architect-engineer contracts.
Selection criteria.

(a) In addition to the evaluation criteria set forth in FAR 36.602-1, the evaluation board must consider the factors set forth in paragraph (b) of this section as they apply to the project or purpose of the selection. Values must be assigned to each factor in determining the relative qualifications of the firms identified as qualified through the pre-selection process. The board may adjust the assigned values after its discussions.

(b) The following factors must be considered:

(1) Reputation and standing of the firm and its principal officials with respect to professional performance, general management, and cooperativeness.

(2) Record of significant claims against the firm because of improper or incomplete architectural and engineering services.

(3) Specific experience and qualifications of personnel proposed for assignment to the project and their record of working together as a team.

Evaluation boards.

(a) The Chief Facilities Management Officer, Office of Facilities Management, shall appoint an evaluation board to select architect-engineer contractors for Office of Facilities Management projects. The Director, Office of Construction Management, shall appoint an evaluation board to select architect-engineer contractors for National Cemetery Administration projects. The facility or VISN director, as appropriate, shall appoint an evaluation board to select architect-engineer contractors for field facility projects.

(b) The Director, A/E Evaluation and Program Support Service, will chair the evaluation board for Office of Facilities Management architect-engineer contracts. The Chair may designate the Project Director or Project Manager to act as Chair when necessary. When appointing the board's members, the Chief Facilities Management Officer, Office of Facilities Management, must include the appropriate Project Manager and as many qualified professional architects or engineers from the Office of Facilities Management technical services as may be considered appropriate for the particular project. The Chief Facilities Management Officer may designate additional members from the Office of Facilities Management or Start Printed Page 2393from other Department administrations and staff offices when appropriate.

(c) The Director, Office of Construction Management, shall ensure that the board consists of no fewer than three members, one of whom must be a National Cemetery Administration senior level contracting officer. The Director shall designate one of the board members as the Chair.

(d) The evaluation board for a VA field facility must consist of no fewer than two members, one of whom will be the HCA (or the senior contracting officer at the facility if there is no HCA on site) and the other will be the Chief, Engineering Service, or their alternates. Where a facility has two or more engineers on its staff, the facility or VISN director must appoint an additional engineer to the board. The Chair of the board will be the senior engineer.

Selection authority.

The Chief Facilities Management Officer, Office of Facilities Management (for Central Office contracts), the Director, Office of Construction Management (for National Cemetery Administration contracts), and the facility or VISN director (for field facility contracts), or persons acting in those capacities, are designated as the approving officials for the recommendations of the respective evaluation boards.

Short selection process for contracts not to exceed the simplified acquisition threshold.

Either of the procedures provided in FAR 36.602-5 may be used to select firms for architect-engineer contracts that are not expected to exceed the simplified acquisition threshold.

Collecting data on and appraising firms qualifications.

The Chief Facilities Management Officer, Office of Facilities Management, for Central Office; the Director, Office of Construction Management, for National Cemetery Administration; and the Chief, Engineering Service, for field facilities, are responsible for collecting Standard Forms 330 and maintaining a data file on architect-engineer qualifications.

Negotiations.
General.

To assure that the fee limitation is not violated, the contracting officer must maintain suitable records to be able to isolate the amount in the total fee to which the 6-percent limitation applies.

Architect-engineer's proposal.

(a) When the contract price is estimated to be $50,000 or more, the contracting officer must use VA Form 10-6298, Architect-Engineer Fee Proposal, to obtain the proposal and supporting cost data from the contractor and subcontractor in the negotiation of architect-engineer contracts for design services.

(b) In obtaining architect-engineer services for research study, seismic study, master planning study, construction management and other related services contracts, the contracting officer must use VA Form 10-6298 supplemented or modified as needed for the particular project type.

Contract price.

(a) Where negotiations with the top-rated firm are unsuccessful, the contracting officer shall, after authorization by the Chief Facilities Management Officer, Office of Facilities Management, the Director, Office of Construction Management, or the facility or VISN director, as appropriate, terminate the negotiations and undertake negotiations with the firm next in order of preference.

(b) The contracting officer shall submit a recommendation for award of the contract at the negotiated fee to the Chief Facilities Management Officer, Office of Facilities Management, the Director, Office of Construction Management, or the facility or VISN director, as appropriate. A copy of the negotiation memorandum prepared in accordance with FAR 15.406-3 and, whenever a field pricing report has been received, a copy of the report must accompany the recommendation.

Application of 6 percent architect-engineer fee limitation.

(a) The total cost of the architect or engineer services contracted for must not exceed 6 percent of the estimated cost of the construction project plus any fees for related services and activities such as those shown in paragraph (c) of this section.

(b) To support project submissions, the engineering officer or project engineer must use VA Form 10-1193, Application for Health Care Facility Project, and Form 10-6238, EMIS Construction Program Estimate Worksheet, and must show the proposed technical services where necessary and applicable.

(c) The 6-percent fee limitation does not apply to the following architect or engineer services:

(1) Investigative services including but not limited to:

(i) Determination of program requirements, including schematic or preliminary plans and estimates;

(ii) Determination of feasibility of proposed project;

(iii) Preparation of measured drawings of existing facility;

(iv) Subsurface investigation;

(v) Structural, electrical, and mechanical investigation of existing facility; and

(vi) Surveys: topographic, boundary, utilities, etc.

(2) Special consultant services that are not normally available in organizations of architects or engineers and that are not specifically applied to the actual preparation of working drawings or specifications of the project for which the services are required.

(3) Other:

(i) Reproduction of approved designs through models, color renderings, photographs, or other presentation media;

(ii) Travel and per diem allowances other than those required for the development and review of working drawings and specifications;

(iii) Supervision or inspection of construction, review of shop drawings or samples, and other services performed during the construction phase; and

(iv) All other services that are not an integral part of the production and delivery of plans, designs, and specifications.

(4) The cost of reproducing drawings and specifications for bidding and their distribution to prospective bidders and plan file rooms.

PART 837—SERVICE CONTRACTING Subpart 837.1—Service Contracts—General
Contracting officer responsibility.
Solicitation provisions and contract clauses.
Services provided to eligible beneficiaries.
Subpart 837.2—Advisory and Assistance Services
Policy.
Subpart 837.4—Nonpersonal Health Care Services
Contract clause.
Subpart 837.70—Mortuary Services
General.
List of qualified funeral directors.
Funeral authorization.
Administrative necessity.
Unclaimed remains—all other cases.
Start Authority

Authority: 38 U.S.C. 501; 40 U.S.C. 121(c); and 48 CFR 1.301-1.304.

End Authority

Subpart 837.1—Service Contracts—General

Contracting officer responsibility.

When the contracting officer determines that legal assistance is Start Printed Page 2394necessary in determining whether a proposed service contract is for personal or non-personal services, the contracting officer will request a legal opinion from the appropriate Regional Counsel.

Solicitation provisions and contract clauses.

The contracting officer shall insert the clause at 852.237-70 Contractor Responsibilities, in solicitations and contracts for services.

Services provided to eligible beneficiaries.

Contracting officers shall include the clause at 852.271-70, Nondiscrimination in Services Provided to Beneficiaries, in all solicitations and contracts covering services provided to eligible beneficiaries.

Subpart 837.2—Advisory and Assistance Services

Policy.

The definition of advisory and assistance services includes, in addition to examples listed in FAR 37.203, services to obtain peer review of research proposals.

Subpart 837.4—Nonpersonal Health Care Services

Contract clause.

The contracting officer shall insert the clause at 852.237-7, Indemnification and Medical Liability Insurance, in lieu of FAR Clause 52.237-7, in solicitations and contracts for nonpersonal health-care services, including contracts awarded under the authority of 38 U.S.C. 7409, 38 U.S.C. 8151-8153, and part 873. The contracting officer may include the clause in bilateral purchase orders for nonpersonal health-care services awarded under the procedures in FAR Part 13 and Part 813.

Subpart 837.70—Mortuary Services

General.

This subpart establishes the policies and procedures governing the procurement of funeral and burial services for deceased beneficiaries of VA, as provided in 38 U.S.C. 2302, 2303, and 2308.

List of qualified funeral directors.

Contracting officers will establish, in coordination with cognizant Chief, Medical Administration Service (MAS) personnel or other personnel designated by the facility director to perform these functions, a list of funeral directors capable of performing the burial services specified in 837.7003. The contracting officer will attempt to establish a commitment to perform these services within the statutory limitation of $300 (see 38 U.S.C. 2302). Each funeral director must be fully licensed in the jurisdiction in which the business operates. If there has been no prior experience with the funeral director that would ensure the adequacy of the funeral director's services and casket, arrangements will be made before contract negotiation to inspect the premises and the casket to be provided, as well as to check with the local business bureau and/or Chamber of Commerce. (38 U.S.C. 2302)

Funeral authorization.

(a) When a veteran dies while receiving care in a VA health care facility or in a non-VA institution at VA's expense, and the decedent's remains are unclaimed, the Chief, MAS, or the person designated by the facility director to perform these functions, will forward to the HCA a properly executed VA form 10-2065, Funeral Arrangements, requesting that funeral and burial services for the deceased be procured.

(b) The contracting officer will enter into negotiations with local funeral directors to procure a complete funeral and burial service within the statutory allowance of $300. The purchase order must list the specific services to be provided. The services must consist of the following:

(1) Preparation of the body, embalming.

(2) Clothing.

(3) Casket. (The casket, at a minimum, must be constructed from thick, strong particle board and must be of sufficient strength to support the weight of an adult human body. Cardboard or press paper or similar materials are not acceptable.)

(4) The securing of all necessary permits.

(5) Ensuring that a United States flag (provided the funeral director in accordance with M-1, Part I, paragraph 14.40) accompanies the casket to place of burial.

(c) An additional allowance for transportation of the body to the place of burial is provided in 38 U.S.C. 2308. This allowance will cover the transportation cost of shipment of the body by common carrier or by hearse from the VA facility to the funeral home and to the place of burial, any charges for an outside shipping box, and the charges for securing all necessary permits for removal or shipment of the body. These costs are not chargeable against the $300 allowance.

(d) In accordance with M-1, Part I, paragraph 14.37, the contracting officer will designate the Chief, MAS, or the person designated by the facility director to perform these functions, to be responsible for the medical inspection of the mortuary services performed and inspection of the merchandise furnished. This designee will also be responsible for certifying receipt on the receiving report.

(e) The HCA will assist the Chief, MAS, or the person designated by the facility director to perform these functions, in developing the local procedures specified in M-1, Part I, paragraph 14.37c. (38 U.S.C. 2302, 2303, and 2308)

Administrative necessity.

(a) VA may make arrangements and assume expenses for local burial under separate contractual agreement when:

(1) A person dies under VA care who is not legally entitled to such care at VA's expense;

(2) No relatives or friends claim the remains; and

(3) The municipal, county, or State officials refuse to provide for final disposition.

(b) When the contracting officer cannot obtain a full and complete funeral and burial service as prescribed in 837.7003 within the statutory allowance, before taking any further action, the contracting officer will secure from the facility or VISN director, as appropriate, a written determination that VA must accomplish the disposition of the remains as an administrative necessity. The facility director will also authorize in writing the expenditure of such additional funds as may be necessary for this purpose.

(c) The contracting officer will make the facility director's determination and authorization a part of the contract file. (38 U.S.C. 2302)

Unclaimed remains—all other cases.

Requests for information on the disposition of the unclaimed remains of a veteran whose death occurs while not under the direct care or treatment of VA will be referred to the Veterans Services Officer for processing in accordance with M27-1, Part II.

End Part Start Part

PART 841—ACQUISITION OF UTILITY SERVICES

Subpart 841.1—General
841.100
Scope of part.
841.103
Statutory and delegated authority.
Subpart 841.2—Acquiring Utility Services
Policy.
Start Authority

Authority: 40 U.S.C. 121(c) and (d); and 48 CFR 1.301-1.304.

End Authority
Start Printed Page 2395 Subpart 841.1—General
Scope of part.

This part prescribes procedures for obtaining delegations of authority to award contracts for utility connection charges and provides guidance on review requirements for such proposed contracts.

Statutory and delegated authority.

(a) The Assistant Commissioner for Procurement, General Services Administration (GSA), has delegated the Secretary of Veterans Affairs authority to enter into public utility contracts for connection charges for utility services.

(b) Except as provided in paragraph (a) of this section, the authority to award all other contracts for utility services, as defined in FAR 41.101, is vested in GSA (see FAR 41.103). VA contracting officers who wish to award local contracts for utility services, other than for connection charges, must first obtain a delegation of authority to award such contracts from GSA. Contracting officers shall submit requests for delegation of authority directly to GSA.

(c) Any authority described in paragraphs (a) or (b) of this section delegated to the Secretary is further delegated to the SPE and is further delegated to the DSPE and to VA contracting officers within the limits of their warrants.

Subpart 841.2—Acquiring Utility Services
Policy.

As required by 801.602-71, contracting officers must submit solicitations and proposed agreements for utility services exceeding $50,000 in total costs to the appropriate Acquisition Resources Service office for technical and legal review.

End Part

Subchapter G—Contract Management

Start Part

PART 842—CONTRACT ADMINISTRATION AND AUDIT SERVICES

842.000
Scope of part.
842.070
Definitions.
Subpart 842.1—Contract Audit Services
842.101
Contract audit responsibilities.
842.102
Assignment of contract audit services.
Subpart 842.7—Indirect Cost Rates
842.705
Final indirect cost rates.
Subpart 842.8—Disallowance of Costs
842.801
Notice of intent to disallow costs.
842.801-70
Audit assistance prior to disallowing costs.
842.803
Disallowing costs after incurrence.
Subpart 842.12—Novation and Change-of-Name Agreements
842.1203
Processing agreements.
Start Authority

Authority: 40 U.S.C. 121(c) and 48 CFR 1.301-1.304.

End Authority
Scope of part.

This part applies to all contracts, whether awarded through sealed bidding or negotiation.

Definitions.

Contract administration is the coordination of actions required for the performance of a contract. This includes the contracting officer's guidance and supervision necessary to assure that the contractor fulfills all contractual obligations.

Subpart 842.1—Contract Audit Services

Contract audit responsibilities.

(a) Contracting officers must use the support services of other agencies to the extent feasible. Examples of such services include: pre-award surveys; quality assurance and technical inspection of contract items; and review of contractors' procurement systems. Contracting officers obtaining support services from any other Government department or agency must do so on the basis of an approved negotiated interagency support agreement.

(b) An interagency support agreement is a written instrument of understanding between the parties to the agreement. The agreement should clearly state the following:

(1) The accord reached between the two parties involved, especially the obligations assumed and the rights granted each party.

(2) The resources that both the supplying and receiving parties will provide.

(3) The funding and reimbursement arrangements.

(4) Clauses permitting revisions, modifications, or cancellation of the agreement.

Assignment of contract audit services.

(a) When required, contracting officers shall request the assistance of the VA Office of the Inspector General (OIG), Contract Review and Evaluation Division, to provide pre- and post-award audit, review, and advisory services associated with the award or modification of:

(1) Federal Supply Schedule and other contracts awarded by the VA National Acquisition Center;

(2) Scarce medical specialist or sharing contracts awarded under the authority of 38 U.S.C. 7409 or 8153, and;

(3) Claims involving such contracts.

(b) Contracting officers may request the assistance of either the VA OIG Contract Review and Evaluation Division or the Defense Contract Audit Agency (DCAA) to provide pre- and post-award audit, review, and advisory services associated with other types of contracts or claims.

Subpart 842.7—Indirect Cost Rates

Final indirect cost rates.

(a) Except when the quick-closeout procedures described in FAR 42.708 are used, contracting officers must request audits on proposed final indirect cost rates and billing rates for use in cost reimbursement, fixed-price incentive, and fixed-price redeterminable contracts as prescribed in FAR Subpart 42.7.

(b) When the quick closeout procedures are used, the contracting officers must perform a review and validation of the contractor's data for accuracy and reasonableness of the proposed rates for negotiating the settlement of indirect costs for a specific contract.

Subpart 842.8—Disallowance of Costs

Notice of intent to disallow costs.
Audit assistance prior to disallowing costs.

If a contracting officer determines that costs should be disallowed during the performance of a cost reimbursement, fixed-price incentive, or fixed-price redetermination contract exceeding the thresholds specified in FAR 15.403-4, the contracting officer must request audit assistance. The VA Office of Inspector General shall conduct audits of contracts for health care resources and contracting officers shall request such audits directly from that office. For all other types of contracts, the contracting officer must obtain an audit control number from Acquisition Resources Service and send a formal request to conduct the audit directly to the nearest Defense Contract Audit Agency (DCAA) office, referencing the audit control number and the project number (if any).

Disallowing costs after incurrence.

Contracting officers may approve or disapprove contractors' vouchers for payment and process them to the servicing fiscal office. Such approval or disapproval must be within the limitations of the contracting officer, and the contract for which the voucher is submitted must be within the Start Printed Page 2396contracting officer's delegation of contracting authority.

Subpart 842.12—Novation and Change-of-Name Agreements

Processing agreements.

Before execution of novation and change-of-name agreements, contracting officers must submit all supporting agreements and documentation to the OGC for review as to legal sufficiency.

End Part Start Part

PART 846—QUALITY ASSURANCE

Subpart 846.3—Contract Clauses
846.302
Fixed-price supply contracts.
846.302-70
Guarantee clause.
846.302-71
Inspection.
846.302-72
Frozen processed foods.
846.302-73
Noncompliance with packaging, packing and/or marking requirements.
846.312
Construction contracts.
Subpart 846.4—Government Contract Quality Assurance
846.408
Single-agency assignments of Government contract quality assurance.
846.408-70
Inspection of subsistence.
846.408-71
Waiver of USDA inspection and specifications.
846.470
Use of commercial organizations for inspections and grading services.
846.471
Determination authority.
846.472
Inspection of repairs for properties under the Loan Guaranty and Direct Loan Programs.
846.472-1
Repairs of $1,000 or less.
846.472-2
Repairs in excess of $1,000.
Subpart 846.7—Warranties
846.710
Contract clauses.
846.710-70
Special warranties.
846.710-71
Warranty for construction—guarantee period services.
Start Authority

Authority: 38 U.S.C. 501; 40 U.S.C. 121(c); and 48 CFR 1.301-1.304.

End Authority

Subpart 846.3—Contract Clauses

Fixed-price supply contracts.
Guarantee clause.

The contracting officer shall insert the clause at 852.246-70, Guarantee, in solicitations for the acquisition of equipment.

Inspection.

The contracting officer shall include a “Rejected Goods” contract clause in solicitations and contracts as follows:

(a) Except as provided in paragraph (b) of this section, insert the clause at 852.246-71, Inspection, in solicitations and contracts for the acquisition of supplies or equipment.

(b) In solicitations and contracts for packing house and dairy products, bread and bakery products, and for fresh and frozen fruits and vegetables, insert the Alternate I clause at 852.246-71, Inspection.

Frozen processed foods.

The contracting officer shall insert the clause at 852.246-72, Frozen Processed Foods, in solicitations and contracts for frozen processed foods.

Noncompliance with packaging, packing and/or marking requirements.

The contracting officer shall insert the clause at 852.246-73, Noncompliance with Packaging, Packing and/or Marking Requirements, in non-commercial item solicitations and contracts for supplies or equipment where there are special packaging, packing and/or marking requirements. The clause may be used in commercial item acquisitions if a waiver is approved in accordance with FAR 12.302(c) and 812.302.

Construction contracts.

The contracting officer shall insert the clause at 852.236-74, Inspection of Construction, in solicitations and contracts for construction that include the FAR clause at 52.246-12, Inspection of Construction.

Subpart 846.4—Government Contract Quality Assurance

Single-agency assignments of Government contract quality assurance.
Inspection of subsistence.

(a) Before issuing a solicitation for subsistence, the contracting officer must determine whether:

(1) Representatives of the U.S. Department of Agriculture (USDA) or the Department of Commerce will inspect for specification compliance before shipment; or

(2) Personnel of the purchasing activity will inspect for specification compliance at the time of delivery.

(b) The contracting officer must indicate the time and place of inspection in the solicitation.

(c) Because the requirement for USDA or Department of Commerce inspections and certifications result in additional contractor costs that may be ultimately reflected in bid prices, the contracting officer, in consultation with the Chief, Nutrition and Food Service, must evaluate the need for such inspections. The evaluation must include the following:

(1) The quality assurance already provided by other mandatory inspection systems.

(2) The proposed suppliers' own quality control system.

(3) Experience with the proposed suppliers.

(4) The pre-qualifying of the suppliers' quality assurance systems and subsequently waiving inspections and certifications for future solicitations.

(5) The cost of the inspections.

(d) When the contracting officer indicates that either the USDA or the Department of Commerce will conduct the inspection, the contracting officer must also provide in the solicitation that the contractor is responsible for all of the following:

(1) Arranging and paying for inspection services.

(2) Obtaining from the inspectors a certificate indicating that the product complies with specifications.

(3) Assuring that the certificate, or copy, accompanies the shipment or is furnished to the receiving installation before shipment, or notifying the installation when the certificate is not immediately available.

(4) Seeing that acceptable products are covered by an inspection agency checkloading certificate or stamped by the inspector as prescribed by the contracting officer.

(5) Furnishing samples for inspection at the contractor's expense.

(6) Indicating the address where inspection will occur.

(e) The contracting officer must furnish a copy of the purchase document to the inspecting activity.

Waiver of USDA inspection and specifications.

(a) When the amount of an item to be purchased will not exceed 500 pounds per delivery, the contracting officer may purchase the following without reference to the specifications in Part IV of the Federal Supply Catalog, Stock List, FSC Group 89, Subsistence, Publication No. C8900-SL, and the USDA inspection requirements:

(1) Butter.

(2) Cheese (except cottage cheese).

(3) Sausage.

(4) Meat food products*.

(5) Bacon, smoked.

(6) Bacon, Canadian style.

(b) When the items listed in paragraph (a) of this section are procured together with items that are not exempt, the contracting officer must include the following in the solicitation:

Items * * * are not required to be in accordance with the specifications contained in Part IV of the Federal Supply Catalog, Stock List, FSC Group 89, Subsistence, Publication No. C8900-SL, and the special USDA inspection is not required. VA will inspect for quality and condition upon delivery at destination. These items are, however, subject to the quality controls stated herein. Start Printed Page 2397

(c) As appropriate, the contracting officer must include the following statements in each invitation for bid, request for proposal, quotation, or purchase order:

(1) Butter. This product must be graded by the USDA and labeled “Grade A” or the grade specified herein.

(2) Sausage and meat food products.*

(i) This product must be a high commercial product and must have been prepared in a federally inspected plant and bear the USDA establishment number stamp evidencing that it is sound, healthful, wholesome, and fit for human consumption; and

(ii) This product must bear a label complying with the Federal Food, Drug and Cosmetic Act that requires the listing of all ingredients in the order of their predominance.

(3) Bacon, smoked; and bacon, Canadian style. This product must be a high commercial product and must have been prepared in a federally inspected plant and bear the USDA establishment number stamp evidencing that it is sound, healthful, wholesome, and fit for human consumption.

(d) When using a “brand name or equal” purchase description, the contracting officer must list every brand name item that is known to be acceptable and available in the area.

*“Meat food products” means processed foods containing meat in substantial proportion and other listed ingredients including seasoning, e.g., frankfurters, coldcuts. Whole or prefabricated meats, e.g., pork chops, hamburger, are considered meats, not meat food products.

Use of commercial organizations for inspections and grading services.

The contracting officer may use a commercial organization for inspection and grading services when the contracting officer determines that all of the following conditions exist:

(a) The results of a technical inspection or grading are dependent upon the application of scientific principles or specialized techniques.

(b) VA is unable to employ the personnel qualified to properly perform the services and is unable to locate another Federal agency capable of providing the service.

(c) The inspection or grading results issued by a private organization are essential to verify the acceptance of rejection of a special commodity.

(d) The services may be performed without direct Government supervision.

Determination authority.

The following must make the determinations required in 846.470:

(a) The Chief Facilities Management Officer, Office of Facilities Management, for those items and services for which purchase authority has been assigned to the Office of Facilities.

(b) The Director, Veterans Canteen Service, for those items and services purchased, or contracted for, by the Veterans Canteen Service (except those items purchased from VA supply sources).

(c) The DSPE for all other supplies, equipment, and services.

Inspection of repairs for properties under the Loan Guaranty and Direct Loan Programs.

As provided in 846.472-1 and 846.472-2, management brokers or qualified fee or staff inspectors must conduct a final inspection of all repair programs upon completion. In addition, the broker or inspector must conduct intermediate or progress inspections on extensive or technical jobs as specified in the contract.

Repairs of $1,000 or less.

(a) Generally, the management broker must make any required inspections for repairs of $1,000 or less. A qualified fee or staff inspector must make any required inspection for repairs of $1,000 or less if the contracting officer:

(1) Has not assigned the property to a management broker; or,

(2) Has determined that the nature of the repairs requires supervision by a technician.

(b) There is no form prescribed for inspection of repairs of $1,000 or less, but the inspector may use VA Form 26-1839, Compliance Inspection Report. Regardless of the form in which the report is submitted, the inspector must identify the contractor, property, and the repair program and provide sufficient detail to enable the contracting officer to make a determination that the work is being performed satisfactorily or completed in accordance with the terms of the contract.

Repairs in excess of $1,000.

(a) A qualified fee or staff inspector must make the final inspection and any intermediate or progress inspections on repairs exceeding $1,000.

(b) The inspector must make the report of inspection on VA Form 26-1839, Compliance Inspection Report. The inspector must identify the property, contractor, and repair program and provide sufficient detailed information to enable the contracting officer to make a determination that the work is being performed satisfactorily or that it has been completed in accordance with the terms of the contract. The inspector must itemize any deficiencies and explain the deficiencies in detail.

Subpart 846.7—Warranties

Contract clauses.

The contracting officer shall insert the clause at FAR 52.246-21, Warranty of Construction, in solicitations and contracts for construction that are expected to exceed the micro-purchase threshold.

Special warranties.

The contracting officer shall insert the clause at 852.246-74, Special Warranties, in solicitations and contracts for construction that include the FAR clause at 52.246-21, Warranty of Construction.

Warranty for construction—guarantee period services.

The contracting officer shall insert the clause at 852.246-75, Warranty of Construction “ Guarantee Period Services, in solicitations and contracts for construction that include the FAR clause at 52.246-21, Warranty of Construction, and that also include guarantee period services.

End Part Start Part

PART 847—TRANSPORTATION

Subpart 847.3—Transportation in Supply Contracts
847.303
Standard delivery terms and contract clauses.
847.303-1
F.o.b. origin.
847.303-70
F.o.b. origin, freight prepaid, transportation charges to be included on the invoice.
847.305
Solicitation provisions, contract clauses, and transportation factors.
847.305-70
Potential destinations known but quantities unknown.
847.306
Transportation factors in the evaluation of offers.
847.306-70
Transportation payment and audit.
Start Authority

Authority: 40 U.S.C. 121(c) and 48 CFR 1.301-1.304.

End Authority

Subpart 847.3—Transportation in Supply Contracts

Standard delivery terms and contract clauses.
F.o.b. origin.

Shipments falling within this category must be shipped on a Bill of Lading, except as provided in 41 CFR 102-118.40. Contracting officers must comply with 41 CFR parts 102-117 and 102-118. Contact the Traffic Manager for assistance in determining when to issue the applicable bill of lading (VA Commercial Bill of Lading for domestic Start Printed Page 2398use or Government Bill of Lading for international shipments and domestic off-shore shipments) and for all freight estimates.

F.o.b. origin, freight prepaid, transportation charges to be included on the invoice.

(a) The delivery terms will be stated as “f.o.b. origin, transportation prepaid, with transportation charges to be included on the invoice,” under any of the following circumstances:

(1) When it is determined that an f.o.b. origin purchase or delivery order will have transportation charges that do not exceed $250 and the occasional exception does not exceed that amount by more than $50.

(2) Single parcel shipments via express, courier, small package, or similar carriers, regardless of shipping cost, if the shipped parcel weighs 70 pounds or less and does not exceed 108 inches in length and girth combined.

(3) Multi-parcel shipments via express, courier small package, or similar carriers for which transportation charges do not exceed $250 per shipment.

(b) Orders issued on VA Form 90-2138, Orders for Supplies or Services, must identify shipping instructions on the reverse side of the form. When VA Form 90-2138 is not used, the vendor must do the following:

(1) Consistent with the terms of the contract, pack, mark, and prepare shipment in conformance with carrier requirements to protect the personal property and assure the lowest applicable transportation charge. Follow package specifications found in the National Motor Freight Classification 100 Series.

(2) Add transportation charges as a separate item on the invoice. The invoice must include the following certification: “The invoiced transportation charges have been paid and evidence of such payment will be furnished upon the Government's request.”

(3) Not include charges for insurance or valuation on the invoice unless the order specifically requires that the shipment be insured or the value be declared.

(4) Not prepay transportation charges on the order if such charges are expected to exceed $250. Ship collect and annotate the commercial bill of lading, “To be converted to VA Commercial Bill of Lading.” Contact Traffic Manager for routing instructions and freight estimate.

(c) Each contracting officer is responsible for:

(1) Obtaining the most accurate estimate possible of transportation charges.

(2) Using the authority in paragraph (a) of this section only when consistent with the circumstances in that paragraph.

(d) When, in accordance with FAR Subpart 28.3 and FAR 47.102, a shipment must be insure