Requirements for Acquisitions Pursuant to Multiple-Award Contracts (FAR Case 2007-012)
Summary:
FAC 2005-50 includes an interim rule amending the Federal Acquisition Regulation (FAR) to implement section 863 of the Duncan Hunter National Defense Authorization Act for Fiscal Year 2009. Section 863, entitled "Requirements for Purchase of Property and Services Pursuant to Multiple-Award Contracts," mandates enhanced competition for orders placed under multiple-award contracts, including GSA's Federal Supply Schedules (FSS). If an individual order over the simplified acquisition threshold does not follow the section 863 competitive procedures, section 863 requires that a notice of, and the determination to waive competition for, the order be published in FedBizOpps within 14 days after award. These FAR changes support the Administration's commitment to strengthened competition and increased transparency.
Supplementary Information:
I. Background
This interim rule amends the FAR to implement section 863 of the Duncan Hunter National Defense Authorization Act for Fiscal Year 2009 (Pub. L. 110-417) enacted on October 14, 2008. Section 863 mandated the development and publication of regulations in the FAR to enhance competition for the award of orders placed under multiple-award contracts. Section 863 specified enhancements that include--
• Strengthening competition rules for placing orders under FSS and other multiple-award contracts to ensure both the provision of fair notice to contract holders and the opportunity for contract holders to respond (similar to the procedures implemented for section 803 of the National Defense Authorization Act for Fiscal Year 2002 (Pub. L. 107-107)); and
• Providing notice in FedBizOpps of certain orders placed under multiple-award contracts, including FSS.
The legislation builds on recommendations offered by the Acquisition Advisory Panel, which was established by section 1423 of the Services Acquisition Reform Act of 2003, (Pub. L. 108-136). The final report of the Acquisition Advisory Panel, issued in January 2007, can be accessed at http://acquisition.gov/comp/aap/index.html.
For each individual purchase of property or services in excess of the simplified acquisition threshold (SAT) that is made under a multiple-award contract, section 863 requires the provision of fair notice of intent to make a purchase (including a description of the work to be performed and the basis on which the selection will be made) to all contractors offering such property or services under the multiple-award contract. In addition, the statute requires that all contractors responding to the notice be afforded a fair opportunity to make an offer and have that offer fairly considered by the purchasing official. A notice may be provided to fewer than all contractors offering such property or services under a multiple-award contract if the notice is provided to as many contractors as practicable. When notice is provided to fewer than all the contractors, a purchase cannot be made unless--
• Offers were received from at least three qualified contractors; or
• A contracting officer determines in writing that no additional qualified contractors were able to be identified despite reasonable efforts to do so.
These requirements may be waived on the basis of a justification, including a written determination identifying the statutory basis for an exception to fair opportunity, that is prepared and approved at the levels specified in the FAR.
In considering regulatory changes to strengthen the use of competition in task- and delivery-order contracts, the Defense Acquisition Regulations Council and Civilian Agency Acquisition Council (Councils) sought to develop amendments that take increased and more effective advantage of competition, consistent with the general competition principles addressed in the President's March 4, 2009, Memorandum on Government Contracting (available at http://www.whitehouse.gov/the_press_office/Memorandum-for-the-Heads-of-Executive-Departments-and-Agencies-Subject-Government), while still preserving the efficiencies of these contract vehicles.
For this reason, the rule addresses several issues that are not expressly addressed in section 863, such as competition for the establishment and placement of orders under FSS BPAs. The changes, however, are not applicable to BPAs awarded pursuant to FAR part 13 or to orders awarded under FAR procedures other than those in FAR subparts 8.4 and 16.5.
Dates:
The Effective Date for this interim rule is 16 May 2011.
Applicability Date:
1) The changes in this rule apply to solicitations issued and contracts awarded on or after 16 May 2011 (see FAR 1.108(d)(1)).
2) The changes also apply to orders issued on or after the effective date of this regulation, without regard to whether the underlying contracts were awarded before 16 May 2011
3) The changes apply to Blanket Purchase Agreements (BPAs) established under FSS contracts on or after 16 May 2011
4) The ordering procedures for BPAs in FAR 8.405-3(c) are mandatory for BPAs established under FSS contracts on or after 16 May 2011 and discretionary for BPAs established under FSS contracts prior to the effective date.
Interested parties should submit written comments to the Regulatory Secretariat on or before 16 May 2011 to be considered in the formulation of a final rule.
Click here to read the entire Federal Register notice for this rule.
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