81 FR 39883 - Federal Acquisition Regulation: Strategic Sourcing Documentation

DEPARTMENT OF DEFENSE
GENERAL SERVICES ADMINISTRATION
NATIONAL AERONAUTICS AND SPACE ADMINISTRATION

Federal Register Volume 81, Issue 118 (June 20, 2016)

Page Range		39883-39886
FR Document		2016-14412

DoD, GSA, and NASA are proposing to amend the Federal Acquisition Regulation (FAR) to implement a section of the Carl Levin and Howard P. ``Buck'' McKeon National Defense Authorization Act for Fiscal Year 2015 that provides that the contract file shall contain certain documentation if the Federal Government makes a purchase of supplies and services offered under the Federal Strategic Sourcing Initiative (FSSI), but the FSSI is not used.

Federal Register, Volume 81 Issue 118 (Monday, June 20, 2016)

[Federal Register Volume 81, Number 118 (Monday, June 20, 2016)]
[Proposed Rules]
[Pages 39883-39886]
From the Federal Register Online [www.thefederalregister.org]
[FR Doc No: 2016-14412]

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DEPARTMENT OF DEFENSE

GENERAL SERVICES ADMINISTRATION

NATIONAL AERONAUTICS AND SPACE ADMINISTRATION

48 CFR Parts 8 and 13

[FAR Case 2015-015; Docket No. 2015-0015; Sequence No. 1]
RIN 9000-AM89

Federal Acquisition Regulation: Strategic Sourcing Documentation

AGENCY: Department of Defense (DoD), General Services Administration
(GSA), and National Aeronautics and Space Administration (NASA).

ACTION: Proposed rule.

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SUMMARY: DoD, GSA, and NASA are proposing to amend the Federal
Acquisition Regulation (FAR) to implement a section of the Carl Levin
and Howard P. ``Buck'' McKeon National Defense Authorization Act for
Fiscal Year 2015 that provides that the contract file shall contain
certain documentation if the Federal Government makes a purchase of
supplies and services offered under the Federal Strategic Sourcing
Initiative (FSSI), but the FSSI is not used.

DATES: Interested parties should submit comments to the Regulatory
Secretariat Division at one of the addresses shown below on or before
August 19, 2016 to be considered in the formulation of a final rule.

ADDRESSES: Submit comments in response to FAR case 2015-015 by any of
the following methods:
Regulations.gov: http://www.regulations.gov.

[[Page 39884]]

Submit comments via the Federal eRulemaking portal by searching for
``FAR Case 2015-015''.'' Select the link ``Comment Now'' that
corresponds with ``FAR Case 2015-015.'' Follow the instructions
provided on the screen. Please include your name, company name (if
any), and ``FAR Case 2015-015'' on your attached document(s).
Mail: General Services Administration, Regulatory
Secretariat Division, ATTN: Ms. Flowers, 1800 F Street NW., 2nd floor,
Washington, DC 20405.
Instructions: Please submit comments only and cite ``FAR case 2015-
015'' in all correspondence related to this case. Comments received
will generally be posted without change to http://www.regulations.gov,
including any personal and/or business confidential information
provided. To confirm receipt of your comment, please check
www.regulations.gov, approximately two to three business days after
submission to verify posting (except allow 30 days for posting of
comments submitted by mail.)

FOR FURTHER INFORMATION CONTACT: For clarification of content, contact
Mr. Michael O. Jackson, Procurement Analyst, at 202-208-4949. For
information pertaining to status or publication schedules, contact the
Regulatory Secretariat Division at 202-501-4755. Please cite ``FAR Case
2015-015.''

SUPPLEMENTARY INFORMATION:

I. Background

Section 836 of the Carl Levin and Howard P. ``Buck'' McKeon
National Defense Authorization Act for Fiscal Year 2015 (NDAA) (Pub. L.
113-291) was enacted on December 19, 2014. This provision is part of
subtitle D, Federal Information Technology Acquisition Reform, of title
VIII of the NDAA. It established that when the Federal Government makes
a purchase of supplies or services offered under the Federal Strategic
Sourcing Initiative (FSSI), but the FSSI is not used, the contract file
for the purchase shall include a brief analysis of the comparative
value, including price and nonprice factors, between the supplies and
services offered under the FSSI and those offered under the source(s)
to be used for the purchase. The goals and benefits of the FSSI Program
as taken directly from the FSSI strategic sourcing Web site
(www.strategicsourcing.gov) are--
Strategic sourcing is the structured and collaborative process of
critically analyzing an organization's spending patterns to better
leverage its purchasing power, reduce costs, and improve overall
performance. The primary goals of FSSI are to--
Strategically source across federal agencies;
Establish mechanisms to increase total cost savings,
value, and socioeconomic participation;
Collaborate with industry to develop optimal solutions;
Share best practices; and
Create a strategic sourcing community of practice.
Strategic Sourcing drives both dollar savings and process
improvements. The Federal Government, suppliers and ultimately the U.S.
taxpayers benefit when government can better articulate its
requirements and provide committed purchase volumes, and in return,
industry suppliers can provide better pricing and more valuable
solutions. Specific benefits of Strategic Sourcing include--
Meet OMB's goal for cross-government participation;
Assist with socioeconomic goals;
Collect and analyze data;
Identify trends;
Re-engineer high cost business processes;
Replicate cost-saving business processes;
Share lessons learned and best practices;
Realize cost efficiencies;
Streamline procurement process; and
Drive additional discounts.
By ensuring consideration of strategically sourced vehicles, the
proposed documentation requirement will raise the visibility of these
solutions, promote their use, and help to better leverage the
Government's buying power.
This proposed rule complements other efforts and strategies being
developed under the Category Management Initiative, which builds on the
success of strategic sourcing by managing entire categories of common
purchases across the Government and utilizing teams of experts to
manage those specific categories to drive down total cost and improve
performance. See Transforming the Federal Marketplace: Simplifying
Federal Procurement to Drive Performance, Drive Innovation, and
Increase Savings (December 4, 2014) available at https://www.whitehouse.gov/sites/default/files/omb/procurement/memo/simplifying-federal-procurement-to-improve-performance-drive-innovation-increase-savings.pdf.

II. Proposed FAR Changes

The purpose of the proposed FAR changes is to update FAR 8.004 to
add the requirements established by section 836. Additionally, FAR
13.301 is updated to clarify that for micro-purchases made using the
governmentwide purchase card, purchase card holders shall follow the
documentation requirements in Appendix B of OMB Circular A-123
(available at https://www.whitehouse.gov/sites/default/files/omb/assets/omb/circulars/a123/a123_appendix_b.pdf), which prescribes
management guidance on the use of purchase cards.
This new FAR rulemaking requires contracting officers when
purchasing supplies or services that are offered under the FSSI, but
the FSSI is not used, to document the contract file to include a brief
analysis of the comparative value, including price and nonprice
factors, between the supplies and services offered under the FSSI and
those offered under the source(s) to be used for the purchase.

III. Applicability to Contracts for Amounts not Greater Than the
Simplified Acquisition Threshold (SAT), Commercial Items, and
Commercially Available Off-the-Shelf (COTS) Items

41 U.S.C. 1905 governs the applicability of laws to contracts or
subcontracts in amounts not greater than the SAT. 41 U.S.C. 1906
requires that the FAR include a list of provisions of law that are
inapplicable to the acquisition of commercial items (other than the
acquisition of commercially available off-the-shelf (COTS) items). 41
U.S.C. 1907 requires that the FAR include a list of provisions of law
that are inapplicable to the acquisition of COTS items. It is
anticipated that at the time of the final rule the FAR Council will
approve these determinations.

IV. Executive Orders 12866 and 13563

Executive Orders (E.O.s) 12866 and 13563 direct agencies to assess
all costs and benefits of available regulatory alternatives and, if
regulation is necessary, to select regulatory approaches that maximize
net benefits (including potential economic, environmental, public
health and safety effects, distributive impacts, and equity). E.O.
13563 emphasizes the importance of quantifying both costs and benefits,
of reducing costs, of harmonizing rules, and of promoting flexibility.
This is a significant regulatory action and, therefore, was subject to
Office of Information and Regulatory Affairs (OIRA) review under
Section 6(b) of E.O. 12866, Regulatory Planning and Review, dated
September

[[Page 39885]]

30, 1993. This proposed rule is not a major rule under 5 U.S.C. 804.

V. Regulatory Flexibility Act

DoD, GSA, and NASA 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 the proposed rule only affects the internal operating
procedures of the Government.
However, an Initial Regulatory Flexibility Analysis (IRFA) was
performed and is summarized as follows:

This rule implements section 836 of the Carl Levin and Howard P.
``Buck'' McKeon National Defense Authorization Act for Fiscal Year
2015, which provides that the contract file shall contain certain
documentation if the Federal Government makes a purchase of supplies
and services offered under the Federal Strategic Sourcing Initiative
(FSSI), but the FSSI is not used.
The goal of the rule is to have contracting officers consider
use of the GSA Federal Strategic Sourcing Initiative (FSSI) when
purchasing items that are available through FSSI.
According to the Federal Procurement Data System, in Fiscal Year
2014, the Federal Government made approximately 170,403 contract
awards (not including modifications and orders), of which
approximately 85,624 (50.25 percent) were awarded to about 43,545
unique small business entities. The rule requires action by
contracting officers when purchasing items available through FSSI
and will not directly affect any small entities. It specifically
requires the contracting officer to place certain documentation in
the contract file if the Federal Government makes a purchase of
supplies and services offered under the Federal Strategic Sourcing
Initiative (FSSI), but the FSSI is not used. The rule could
indirectly affect small businesses that offer supplies or services
under the FSSI as the rule will require contracting officers to
consider FSSI vendors when they may not have done so in the past,
and this could lead to more sales for those small businesses. There
are currently 137 entities awarded under the FSSI, of which 78 (57
percent) are small entities. The required consideration of FSSI
offerings does not directly have a negative effect on entities not
awarded an FSSI contract, but the required contracting officer
consideration and documentation requirement could indirectly lead to
more purchases going to those vendors involved in the FSSI.
An explicit goal of Federal strategic sourcing is to maintain
and/or enhance socio-economic goals. Partnering with small
businesses during key stages of the strategic sourcing process will
enable the FSSI to meet or exceed socio-economic goals. As part of
the FSSI process, current spending with small business is baselined
for each initiative to gain an understanding of how much is being
spent. Then sourcing strategies are developed that expand the
business done with targeted groups against that baseline, quantify
the expected changes, and compare this with actual results as
required by OMB guidance on strategic sourcing. Each participating
agency will continue to be responsible for achieving its socio-
economic goals and will need to evaluate the impact of FSSI sourcing
recommendations.
There is no reporting required by Government contractors, all
action on the rule is internal to the Government.
The rule does not duplicate, overlap, or conflict with any other
Federal rules.
No viable alternatives were determined at this rulemaking stage.

The Regulatory Secretariat Division has submitted a copy of the
IRFA to the Chief Counsel for Advocacy of the Small Business
Administration. A copy of the IRFA may be obtained from the Regulatory
Secretariat Division. DoD, GSA and NASA invite comments from small
business concerns and other interested parties on the expected impact
of this rule on small entities.
DoD, GSA, and NASA will also consider comments from small entities
concerning the existing regulations in subparts affected by the rule in
accordance with 5 U.S.C. 610. Interested parties must submit such
comments separately and should cite 5 U.S.C. 610 (FAR Case 2015-015),
in correspondence.

VI. Paperwork Reduction Act

The proposed rule does not contain any information collection
requirements that require the approval of the Office of Management and
Budget under the Paperwork Reduction Act, 44 U.S.C. chapter 35.

List of Subjects in 48 CFR Parts 8 and 13

Government procurement.

Dated: June 14, 2016.
William F. Clark,
Director, Office of Government-wide Acquisition Policy, Office of
Acquisition Policy, Office of Government-wide Policy.
Therefore, DoD, GSA and NASA propose amending 48 CFR parts 8 and 13
as set forth below:

0
1. The authority citation for 48 CFR parts 8 and 13 continues to read
as follows:

Authority: 40 U.S.C. 121(c); 10 U.S.C. chapter 137; and 51
U.S.C. 20113.

PART 8--REQUIRED SOURCES OF SUPPLIES AND SERVICES

0
2. Amend section 8.004 by--
0
a. Redesignating paragraphs (a)(1) and (2) as paragraphs (a)(1)(i) and
(ii), respectively;
0
b. Redesignating the introductory paragraph as paragraph (a)(1);
0
c. Removing from the newly designated paragraph (a)(1) ``paragraph
(a)'' and ``paragraph (b)'' and adding ``paragraph (a)(1)'' and
``paragraph (a)(2)'' in their places, respectively;
0
d. Removing from the newly redesignated paragraph (a)(1)(ii)
``paragraph (a)(1)'' and adding ``paragraph (a)(1)(i)'' in its place;
0
e. Redesignating paragraph (b) as paragraph (a)(2); and
0
f. Adding new paragraph (b).
The addition reads as follows:

8.004 Use of other sources.

* * * * *
(b) Documentation requirements relating to the Federal Strategic
Sourcing Initiative (FSSI). When purchasing supplies or services that
are offered under the FSSI, but the FSSI is not used, the contract file
shall be documented to include a brief analysis of the comparative
value, including price and nonprice factors, between the supplies and
services offered under the FSSI and those offered under the source(s)
to be used for the purchase (section 836 of Pub. L. 113-291).

PART 13--SIMPLIFIED ACQUISITION PROCEDURES

0
3. Amend section 13.301 by revising paragraph (b) to read as follows:

13.301 Governmentwide commercial purchase card.

* * * * *
(b)(1) Agencies using the Governmentwide commercial purchase card
shall establish procedures for use and control of the card that comply
with the Treasury Financial Manual for Guidance of Departments and
Agencies (TFM 4-4500) (available at http://tfm.fiscal.treasury.gov/v1/p4/c450.html, the Office of Management and Budget's Circular A-123,
Appendix B (available at https://www.whitehouse.gov/sites/default/files/omb/assets/omb/circulars/a123/a123_appendix_b.pdf), and that are
consistent with the terms and conditions of the current GSA credit card
contract.
(2) Agency procedures should not limit the use of the
Governmentwide commercial purchase card to micro-purchases. Agency
procedures should encourage use of the card in greater dollar amounts
by contracting officers to place orders and to pay for purchases
against contracts established under part 8 procedures, when authorized;
and to place orders and/or make payment under other contractual
instruments, when agreed to by the contractor. See 32.1110(d) for
instructions for use of the appropriate clause when payment under

[[Page 39886]]

a written contract will be made through use of the card.
* * * * *
[FR Doc. 2016-14412 Filed 6-17-16; 8:45 am]
BILLING CODE 6820-EP-P

Federal Register / Vol. 81, No. 118 / Monday, June 20, 2016 / Proposed Rules 39883

effects, distributive impacts, and There are no known significant alternatives PART 13—SIMPLIFIED ACQUISITION
equity). E.O. 13563 emphasizes the to the rule. The impact of this proposed rule PROCEDURES
importance of quantifying both costs on small business is not expected to be
and benefits, of reducing costs, of significant. 13.003 [Amended]
harmonizing rules, and of promoting ■ 3. Amend section 13.003 by removing
flexibility. This is not a significant The Regulatory Secretariat Division from paragraph (b)(1) ‘‘$300,000’’ and
regulatory action and, therefore, was not has submitted a copy of the IRFA to the adding ‘‘$750,00’’ in its place.
subject to review under section 6(b) of Chief Counsel for Advocacy of the Small
E.O. 12866, Regulatory Planning and Business Administration. A copy of the PART 19—SMALL BUSINESS
IRFA may be obtained from the PROGRAMS
Review, dated September 30, 1993. This
proposed rule is not a major rule under Regulatory Secretariat Division. DoD, 19.203 [Amended]
5 U.S.C. 804. GSA, and NASA invite comments from
■ 4. Amend section 19.203 by removing
small business concerns and other from paragraph (b) ‘‘$300,000’’ and
III. Regulatory Flexibility Act interested parties on the expected adding ‘‘$750,000’’ in its place.
DoD, GSA, and NASA do not expect impact of this proposed rule on small
this proposed rule to have a significant entities. 19.502–2 [Amended]
economic impact on a substantial DoD, GSA, and NASA will also ■ 5. Amend section 19.502–2 by
number of small entities within the removing from paragraph (a) ‘‘$300,000’’
consider comments from small entities
meaning of the Regulatory Flexibility and adding ‘‘$750,000’’ in its place.
concerning the existing regulations in
Act, 5 U.S.C. 601, et seq., because the [FR Doc. 2016–14413 Filed 6–17–16; 8:45 am]
subparts affected by the proposed rule
rule raises the simplified acquisition BILLING CODE 6820–EP–P
threshold for special emergency consistent with 5 U.S.C. 610. Interested
procurement authority, an arena in parties must submit such comments
which a smaller percentage of small separately and should cite 5 U.S.C. 610 DEPARTMENT OF DEFENSE
businesses participate, as compared to (FAR Case 2016–004), in
larger businesses. However, an initial correspondence. GENERAL SERVICES
regulatory flexibility analysis (IRFA) has ADMINISTRATION
IV. Paperwork Reduction Act
been prepared consistent with 5 U.S.C.
603. The analysis is summarized as The proposed rule does not contain NATIONAL AERONAUTICS AND
follows: any information collection requirements SPACE ADMINISTRATION
This proposed rule implements section 816 that require the approval of the Office of
Management and Budget under the 48 CFR Parts 8 and 13
of the National Authorization Act for Fiscal
Year (FY) 2016 Public Law 114–92. Paperwork Reduction Act (44 U.S.C. [FAR Case 2015–015; Docket No. 2015–
Therefore, the FAR is revised to raise the chapter 35). 0015; Sequence No. 1]
simplified acquisition thresholds for special
emergency procurement authority. List of Subjects in 48 CFR Parts 2, 13, RIN 9000–AM89
The objective of this proposed rule is to and 19
increase the simplified acquisition thresholds Federal Acquisition Regulation:
for special emergency procurement authority Government procurement. Strategic Sourcing Documentation
from $300,000 to $750,000 (within the
United States) and $1 million to $1.5 million Dated: June 14, 2016. AGENCY: Department of Defense (DoD),
(outside the United States) for acquisitions of William Clark, General Services Administration (GSA),
supplies or services that, as determined by and National Aeronautics and Space
Director, Office of Government-Wide
the head of the agency, are to be used to Administration (NASA).
Acquisition Policy, Office of Acquisition
support a contingency operation or to ACTION: Proposed rule.
Policy, Office of Government-Wide Policy.
facilitate defense against or recovery from
nuclear, biological, chemical, or radiological Therefore, DoD, GSA, and NASA are SUMMARY: DoD, GSA, and NASA are
attack. proposing to amend 48 CFR parts 2, 13, proposing to amend the Federal
DoD, GSA, and NASA do not expect this Acquisition Regulation (FAR) to
and 19, as set forth below:
proposed rule to have a significant economic implement a section of the Carl Levin
impact on a substantial number of small ■ 1. The authority citation for 48 CFR
entities within the meaning of the Regulatory
and Howard P. ‘‘Buck’’ McKeon
parts 2, 13, and 19 continues to read as National Defense Authorization Act for
Flexibility Act, 5 U.S.C.601, et seq., because
the rule raises the simplified acquisition
follows: Fiscal Year 2015 that provides that the
threshold for special emergency Authority: 40 U.S.C. 121(c); 10 U.S.C. contract file shall contain certain
procurements, an arena in which a smaller chapter 137; and 51 U.S.C. 20113. documentation if the Federal
percentage of small businesses participate, as Government makes a purchase of
compared to larger businesses. Between PART 2—DEFINITIONS WORDS AND supplies and services offered under the
$300,000 and the increase to $750,000, 188 Federal Strategic Sourcing Initiative
total awards were made of which 45 or 24
TERMS
(FSSI), but the FSSI is not used.
percent were to small businesses in FY 2014, 2.101 [Amended]
and 219 total awards were made of which 66 DATES: Interested parties should submit
or 30 percent were to small businesses in FY 2. Amend the definition ‘‘Simplified comments to the Regulatory Secretariat
asabaliauskas on DSK3SPTVN1PROD with PROPOSALS

■
2015. Between $1 million and the increase to acquisition threshold’’ in paragraph (b) Division at one of the addresses shown
$1.5 million, 56 total awards were made of of section 2.101 by: below on or before August 19, 2016 to
which 10 or 17 percent were small be considered in the formulation of a
businesses in FY 2014, and 29 total awards ■ a. Removing from paragraph (1)
final rule.
were made of which 9 or 31 percent were to ‘‘$300,000’’ and adding in its place
small businesses in FY 2015. The proposed ADDRESSES: Submit comments in
‘‘$750,000’’; and
rule imposes no reporting, recordkeeping, or response to FAR case 2015–015 by any
other information collection requirements. ■ b. Removing from paragraph (2) ‘‘$1 of the following methods:
The rule does not duplicate, overlap, or million’’ and adding in its place ‘‘$1.5 • Regulations.gov: http://
conflict with any other Federal rules. million’’. www.regulations.gov.

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$39886 Federal Register / Vol. 81, No. 118 / Monday, June 20, 2016 / Proposed Rules a written contract will be made through use of the card. * * * * * [FR Doc. 2016–14412 Filed 6–17–16; 8:45 am] BILLING CODE 6820–EP–P asabaliauskas on DSK3SPTVN1PROD with PROPOSALS VerDate Sep<11>2014 19:01 Jun 17, 2016 Jkt 238001 PO 00000 Frm 00014 Fmt 4702 Sfmt 9990 E:\FR\FM\20JNP1.SGM 20JNP1$

Document Created: 2016-06-18 00:09:00
Document Modified: 2016-06-18 00:09:00

Category		Regulatory Information
Collection		Federal Register
sudoc Class		AE 2.7: GS 4.107: AE 2.106:
Publisher		Office of the Federal Register, National Archives and Records Administration
Section		Proposed Rules
Action		Proposed rule.
Dates		Interested parties should submit comments to the Regulatory
Contact		For clarification of content, contact Mr. Michael O. Jackson, Procurement Analyst, at 202-208-4949. For information pertaining to status or publication schedules, contact the Regulatory Secretariat Division at 202-501-4755. Please cite ``FAR Case 2015-015.''
FR Citation		81 FR 39883
RIN Number		9000-AM89
CFR Citation		48 CFR 13 48 CFR 8

81 FR 39883 - Federal Acquisition Regulation: Strategic Sourcing Documentation

DEPARTMENT OF DEFENSEGENERAL SERVICES ADMINISTRATIONNATIONAL AERONAUTICS AND SPACE ADMINISTRATION

Federal Register Volume 81, Issue 118 (June 20, 2016)

DEPARTMENT OF DEFENSE
GENERAL SERVICES ADMINISTRATION
NATIONAL AERONAUTICS AND SPACE ADMINISTRATION