SUPPLEMENTARY INFORMATION:

A. Background

Offerors are currently required to certify whether or not, within a three-year period preceding an offer, they have been convicted of or had a civil judgment rendered against them for tax evasion or are presently indicted for, or otherwise criminally or civilly charged with, the commission of tax evasion. This proposed rule requires offerors to also certify whether or not they have, within a three-year period preceding the offer, been convicted of or had a civil judgment rendered against them for violating any tax law or failing to pay any tax, or been notified of any delinquent taxes for which the liability remains unsatisfied. The offeror also will be required to certify whether or not they have received a notice of a tax lien filed against them for which the liability remains unsatisfied or the lien has not been released. The additional certifications are needed to identify prospective offerors that may have outstanding tax obligations that may be delinquent so that the Government can make an informed responsibility determination, as necessary. If an offeror certifies that any of these conditions exist, the contracting officer may ask the offeror for additional information related to the obligation to evaluate the offeror’s ability to perform under the contract. In accordance with FAR 1.107, ( printed page 15094) the new certification must be approved by the Administrator for the Office of Federal Procurement Policy before a final rule can be issued.

In FAR 9.105-1 a cross reference is made to FAR 9.408 which describes additional actions contracting officers may take. In FAR 9.408 the language referring to the certifications at FAR 52.209-5 and 52.212-3 is simplified. In FAR 9.406-2 and 9.407-2, the following additional causes for debarment or suspension are added: delinquent taxes; unresolved tax liens; and a conviction of or civil judgment for violating tax laws or failing to pay taxes. The nonpayment of taxes is not restricted to Federal taxes, but may relate to any taxing entity. The focus of “delinquent taxes” is on taxes which are still unpaid: the affirmative certification is required after the taxpaying offeror is notified that the taxes are delinquent, for taxes which remain unpaid as of the date of certification.

This is not a significant regulatory action and, therefore, was not subject to review under Section 6(b) of Executive Order 12866, Regulatory Planning and Review, dated September 30, 1993. This rule is not a major rule under 5 U.S.C. 804.

B. Regulatory Flexibility Act

The Councils do not expect this proposed rule to have a significant economic impact on a substantial number of small entities within the meaning of the Regulatory Flexibility Act, 5 U.S.C. 601, et seq., because most prospective offerors pay their tax liabilities.

An Initial Regulatory Flexibility Analysis has, therefore, not been performed. We invite comments from small businesses and other interested parties. The Councils will consider comments from small entities concerning the affected FAR Parts 9 and 52 in accordance with 5 U.S.C. 610. Interested parties must submit such comments separately and should cite 5 U.S.C. 601, et seq. (FAR case 2006-011), in correspondence.

C. Paperwork Reduction Act

The Paperwork Reduction Act does not apply because the proposed changes to the FAR do not impose information collection requirements that require the approval of the Office of Management and Budget under 44 U.S.C. 3501, et seq.

Therefore, DoD, GSA, and NASA propose amending 48 CFR parts 9 and 52 as set forth below:

1. The authority citation for 48 CFR parts 9 and 52 continues to read as follows:

Authority: 40 U.S.C. 121(c); 10 U.S.C. chapter 137; and 42 U.S.C. 2473(c).

(b)(1) * * *

(v) Delinquent taxes or unresolved tax liens.

4. Amend section 9.407-2 paragraph (a)(3) by adding “violating tax laws, failing to pay taxes,” after “tax evasion,”; redesignating paragraph (a)(7) as paragraph (a)(8) and by adding new paragraph (a)(7); to read as follows:

(a) * * *

(7) Delinquent taxes or unresolved tax liens.

5. Amend section 9.408 by revising the introductory text of paragraph (a) to read as follows:

(a) When an offeror provides an affirmative response in paragraph (a)(1) of provision 52.209-5 or paragraph (h) of provision 52.212-3, ( e.g., indictment, conviction, debarment), the contracting officer shall—

6. Amend section 52.209-5 by—

a. Revising the date of the clause;

b. Adding to paragraph (a)(1)(i)(B) “violating tax laws, failing to pay taxes,” after “tax evasion,”; and by removing “and” from the end of the paragraph;

c. Removing the period from the end of paragraph (a)(1)(i)(C) and adding a semicolon in its place; and

d. Adding paragraphs (a)(1)(i)(D)and (a)(1)(i)(E).

The revised and added text read as follows:

CERTIFICATION REGARDING DEBARMENT, SUSPENSION, PROPOSED DEBARMENT, AND OTHER RESPONSIBILITY MATTERS (DATE)

(a)(1) * * *

(i) * * *

(D) Have □ have not □, within a three-year period preceding this offer, been notified of any delinquent taxes for which the liability remains unsatisfied; and

(E) Have □ have not □ received notice of a tax lien filed against them for which the liability remains unsatisfied or the lien has not been released.

7. Amend section 52.212-3 by—

a. Revising the date of the clause;

b. Adding to paragraph (h)(2) “violating tax laws, failing to pay taxes”, after “tax evasion”; and

c. Adding paragraphs (h)(4) and (h)(5).

The revised and added text read as follows:

OFFEROR REPRESENTATIONS AND CERTIFICATIONS-COMMERCIAL ITEMS (DATE)

(h) * * *

(4) □ Have □ have not, within a three-year period preceeding this offer, been notified of any delinquent taxes for which the liability remains unsatisfied; and

(5) □ Have □ have not received notice of a tax lien filed against them for which the liability remains unsatisfied or the lien has not been released.