81_FR_45251 81 FR 45118 - Department of the Treasury Acquisition Regulations; Incremental Funding of Fixed-Price, Time-and-Material or Labor-Hour Contracts During a Continuing Resolution

81 FR 45118 - Department of the Treasury Acquisition Regulations; Incremental Funding of Fixed-Price, Time-and-Material or Labor-Hour Contracts During a Continuing Resolution

DEPARTMENT OF THE TREASURY

Federal Register Volume 81, Issue 133 (July 12, 2016)

Page Range45118-45120
FR Document2016-16346

This proposed rule would amend the Department of Treasury Acquisition Regulation (DTAR) for the purposes of providing acquisition policy for incremental funding of Fixed-Price, Time-and-Material or Labor-Hour contracts during a continuing resolution.

Federal Register, Volume 81 Issue 133 (Tuesday, July 12, 2016)
[Federal Register Volume 81, Number 133 (Tuesday, July 12, 2016)]
[Proposed Rules]
[Pages 45118-45120]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2016-16346]


=======================================================================
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DEPARTMENT OF THE TREASURY

48 CFR Parts 1032 and 1052


Department of the Treasury Acquisition Regulations; Incremental 
Funding of Fixed-Price, Time-and-Material or Labor-Hour Contracts 
During a Continuing Resolution

AGENCY: Department of the Treasury.

ACTION: Proposed rule.

-----------------------------------------------------------------------

SUMMARY: This proposed rule would amend the Department of Treasury 
Acquisition Regulation (DTAR) for the purposes of providing acquisition 
policy for incremental funding of Fixed-Price, Time-and-Material or 
Labor-Hour contracts during a continuing resolution.

DATES: Comment due date: September 12, 2016.

ADDRESSES: Treasury invites comments on the topics addressed in this 
proposed rule. Comments may be submitted to Treasury by any of the 
following methods: by submitting electronic comments through the 
federal government e-rulemaking portal, www.regulations.gov, by email 
to [email protected]; or by sending paper comments to 
Department of the Treasury, Office of the Procurement Executive, Attn: 
Thomas O'Linn, 1722 I Street NW., Mezzanine--M12C, Washington, DC 
20006.
    In general, Treasury will post all comments to www.regulations.gov 
without change, including any business or personal information 
provided, such as names, addresses, email addresses, or telephone 
numbers. Treasury will also make such comments available for public 
inspection and copying in Treasury's Library, Department of the 
Treasury, 1500 Pennsylvania Avenue NW., Washington, DC 20220, on 
official business days between the hours of 10:00 a.m. and 5:00 p.m. 
Eastern Time. You can make an appointment to inspect comments by 
telephoning (202) 622-0990. All comments, including attachments and 
other supporting materials received are part of the public record and 
subject to public disclosure. You should submit only information that 
you wish to make publicly available.

FOR FURTHER INFORMATION CONTACT: Thomas O'Linn, Procurement Analyst, 
Office of the Procurement Executive, at (202) 622-2092.

SUPPLEMENTARY INFORMATION: 

Background

    The DTAR, which supplements the Federal Acquisition Regulation 
(FAR), is codified at 48 CFR Chapter 10.
    The Anti-Deficiency Act, 31 U.S.C 1341 and the FAR section 32.702, 
state that no officer or employee of the government may create or 
authorize an obligation in excess of the funds available, or in advance 
of appropriations unless otherwise authorized by law. A continuing 
resolution (CR) provides funding for continuing projects or activities 
that were conducted in the prior fiscal year for which appropriations, 
funds, or other authority was previously made available.
    Each CR is governed by its specific terms. However, amounts 
available under a CR are frequently insufficient to fully fund contract 
actions that may be required during its term. No existing contract 
clause permits partial funding of a contract action awarded during a 
CR. While other strategies are available to address the need to take 
contract actions during a CR, these strategies--for example short-term 
awards--are inefficient and may have other disadvantages.
    This proposal would establish policies and procedures in order to 
facilitate successful, timely, and economical execution of Treasury 
contractual actions during a CR. Specifically, this proposed rule would 
set forth procedures for using incremental funding for fixed-price, 
time-and-material and labor-hour contracts during a period in which 
funds are provided to Treasury Departmental Offices or Bureaus under a 
CR. Heads of contracting activities may develop necessary supplemental 
internal procedures as well as guidance to advise potential offerors, 
offerors and contractors of these policies and procedures.

Regulatory Planning and Review

    This rule is not a significant regulatory action as defined in 
section

[[Page 45119]]

3(f) of Executive Order 12866. Therefore a regulatory assessment is not 
required.

Regulatory Flexibility Act

    The Regulatory Flexibility Act (5 U.S.C. chapter 6) generally 
requires agencies to conduct an initial regulatory flexibility analysis 
and a final regulatory flexibility analysis of any rule subject to 
notice and comment rulemaking requirements, unless the agency certifies 
that the rule will not have a significant economic impact on a 
substantial number of small entities. It is hereby certified that this 
proposed rule would not have a significant economic impact on a 
substantial number of small entities. The rule is intended to make 
changes to the DTAR that would allow for improvements in continuity 
when Treasury funding is operating under a CR and should not have 
significant economic impacts on small entities. Notwithstanding this 
certification, the Department welcomes comments on the potential impact 
on small entities.

List of Subjects in 48 CFR Parts 1032 and 1052

    Government procurement.

    Accordingly, the Department of the Treasury proposes to amend 48 
CFR Chapter 10 as follows:

PART 1032--CONTRACT FINANCING

0
1. The authority citation for part 1032 continues to read as follows:

    Authority:  41 U.S.C. 1707.

0
2. Add subpart 1032.7 to read as follows:
Subpart 1032.7--Contract Funding
Sec.
1032.770 Incremental funding during a Continuing Resolution.
1032.770-1 Scope of section.
1032.770-2 Definition.
1032.770-3 General.
1032.770-4 Policy.
1032.770-5 Limitations.
1032.770-6 Procedures.
1032.770-7 Clause.

Subpart 1032.7--Contract Funding


1032.770  Incremental funding during a Continuing Resolution.


1032.770-1  Scope of section.

    This section provides policy and procedure for using incremental 
funding for fixed-price, time-and-material and labor-hour contracts 
during a period in which funds are provided to Treasury Departmental 
Offices or Bureaus, under a continuing resolution (CR). HCAs may 
develop necessary supplemental internal procedures as well as guidance 
to advise potential offerors, offerors and contractors of these 
policies and procedures. Additionally, Bureaus who receive non-
appropriated funds may utilize and tailor these policies and procedures 
to fit their needs.


1032.770-2  Definition.

    ``Continuing Resolution'' means an appropriation, in the form of a 
joint resolution, that provides budget authority for federal agencies, 
specific activities, or both to continue operation until the regular 
appropriations are enacted. Typically, a continuing resolution is used 
when legislative action on appropriations is not completed by the 
beginning of a fiscal year.


1032.770-3  General.

    The Anti-Deficiency Act, 31 U.S.C 1341 and FAR 32.702, states that 
no officer or employee of the Government may create or authorize an 
obligation in excess of the funds available, or in advance of 
appropriations unless otherwise authorized by law. A CR provides 
funding for continuing projects or activities that were conducted in 
the prior fiscal year for which appropriations, funds, or other 
authority was previously made available. Each CR is governed by the 
specific terms in that specific CR (e.g. duration of the CR) and under 
certain CRs, the funding amounts available for award of contract 
actions are inadequate to fund the entire amounts needed for some 
contract actions.


1032.770-4  Policy.

    (a) A fixed-price, time-and-materials or labor-hour contract or 
order for commercial or non-commercial supplies or severable or non-
severable services may be incrementally funded when--
    (1) Funds are provided to a Treasury Departmental Office or Bureau 
under a CR. This includes funds appropriated to a bureau, funds 
appropriated to another entity that will be directly obligated on a 
Treasury contract, and funds in a revolving fund or similar account 
that will be reimbursed by a customer agency funded by a CR;
    (2) Sufficient funds are not being allocated from the responsible 
fiscal authority to fully fund the contract action that is otherwise 
authorized to be issued;
    (3) There is no statutory restriction that would preclude the 
proposed use of funds;
    (4) Funds are available and unexpired, as of the date the funds are 
obligated;
    (5) Assurance is provided by the responsible financial authority 
that full funding is anticipated once an Appropriation Act is enacted; 
and
    (6) The clause prescribed by 1032.770-7 is incorporated into the 
contract or order.
    (b) Incremental funding may be limited to individual line item(s) 
or a particular order(s).


1032.770-5  Limitations.

    (a) This policy does not apply to contract actions that are not 
covered by the CR.
    (b) If this policy is applied to non-severable services or to 
supplies, the contracting officer shall take into consideration the 
business risk to the Government if funding does not become available to 
fully fund the contract. If the contracting officer determines the use 
of incremental funding for non-severable services or supplies is in the 
best interest of the Government the contracting officer shall ensure 
the contractor fully understands how the limitations of the 
Government's liabilities under the contract might impact its ability to 
perform within the prescribed contract schedule.


1032.770-6  Procedures.

    (a) An incrementally funded fixed-price, time-and-materials or 
labor-hour contract shall be fully funded once funds are available.
    (b) The contracting officer shall ensure that sufficient funds are 
allotted to the contract to cover the total amount payable to the 
contractor in the event of termination of convenience by the 
Government.
    (c) Upon receipt of the contractor's notice under paragraph (c) of 
the clause at 1052.232-90, Limitation of Government's Obligation, the 
contracting officer shall promptly provide written notice to the 
contractor that the Government is--
    (i) Obligating additional funds for continued performance and 
increasing the Government's limitation of obligation in a specified 
amount;
    (ii) Obligating the full amount of funds needed;
    (iii) Terminating for convenience, as applicable, the affected line 
items or contract; or
    (iv) Considering whether to allot additional funds; and
    (A) The contractor is entitled by the contract terms to stop work 
when the Government's limitation of obligation is reached; and
    (B) Any costs expended beyond the Government's limitation of 
obligation are at the contractor's risk.
    (d) Upon learning that the contract will receive no further funds 
by the date provided in the notice under paragraph (c) of the clause at 
1052.232-70, Limitation of Government's Obligation,

[[Page 45120]]

the contracting officer shall promptly give the contractor written 
notice of the Government's decision and terminate the affected line 
items or contract, as applicable, for the convenience of the 
Government.


1032.770-7  Clause.

    The contracting officer shall insert the clause at 1052.232-70, 
Limitation of Government's Obligation, in
    (a) Solicitations and resultant contracts when incremental funding 
of fixed-price, time-and-material or labor-hour contract via a CR is 
anticipated; or
    (b) Contracts or orders when incremental funding of a fixed-price, 
time-and-material or labor-hour contract is authorized and the Treasury 
Departmental Office or Bureau is operating under a CR (see 1032.770-4); 
and
    (c) The CO shall insert the information required in paragraph (a) 
and (c) of the clause.

PART 1052--SOLICITATION PROVISIONS AND CONTRACT CLAUSES

0
3. The authority citation for part 1032 continues to read as follows:

    Authority:  41 U.S.C. 1707.

0
4. Add 1052.232-70 to subpart 1052.2 to read as follows:


1052.232-70  Limitation of Government's Obligation.

    As prescribed in 1032.770-7, insert the following clause. 
Contracting officers are authorized, in appropriate cases, to revise 
paragraph (a) of this clause to specify the work required under the 
contract, in lieu of using contract line item numbers as well as revise 
paragraph (c) of this paragraph to specify a different notification 
period and percentage. The 30-day period may be varied from 45, 60 to 
90 days, and the 75 percent from 75 to 85 percent:

LIMITATION OF GOVERNMENT'S OBLIGATION (TBD 2016)

    (a) Funding is not currently available to fully fund this 
contract due to the Government operating under a continuing 
resolution (CR). The item(s) listed in the table below are being 
incrementally funded as described below. The funding allotted to 
these item(s) is presently available for payment and allotted to 
this contract. This table will be updated by a modification to the 
contract when additional funds are made available, if any, to this 
contract.

----------------------------------------------------------------------------------------------------------------
                                                                                  Funds  required
                                                   CLIN total    Funds  allotted    for complete
       Contract line item number  (CLIN)             price         to  the CLIN   funding of  the
                                                                                        CLIN
-------------------------------------------------------------------------------------------------
                                                             $                $                $
                                                             $                $                $
                                                             $                $                $
                                                             $                $                $
                                               -----------------------------------------------------------------
    Totals....................................               $                $                $
----------------------------------------------------------------------------------------------------------------

    (b) For the incrementally funded item(s) identified in paragraph 
(a) of this clause, the Contractor agrees to perform up to the point 
at which the total amount payable by the government, including any 
invoice payments to which the contractor is entitled and 
reimbursement of authorized termination costs in the event of 
termination of those item(s) for the Government's convenience, does 
not exceed the total amount currently obligated to those item(s). 
The Contractor is not authorized to continue work on these item(s) 
beyond that point. The Government will not be obligated in any event 
to reimburse the contractor in excess of the amount allotted to the 
line items of the contract regardless of anything to the contrary in 
any other clause, including but not limited to the clause entitled 
``Termination for Convenience of the Government'' or paragraph (1) 
entitled ``Termination for the Government's Convenience'' of the 
clause at FAR 52.212-4, ``Commercial Terms and Conditions--
Commercial Items.''
    (c) Notwithstanding paragraph (h) of this clause, the Contractor 
shall notify the Contracting Officer in writing at least thirty days 
prior to the date when, in the Contractor's best judgment, the work 
will reach the point at which the total amount payable by the 
Government, including any cost for termination for convenience, will 
approximate 85 percent of the total amount then allotted to the 
contract for performance of the item(s) identified in paragraph (a) 
of this clause. The notification shall state the estimated date when 
that point will be reached and an estimate of additional funding, if 
any, needed to continue performance. The notification shall also 
advise the Contracting Officer of the estimated amount of additional 
funds required for the timely performance of the item(s) funded 
pursuant to this contract. If after such notification additional 
funds are not allotted by the date identified in the Contractor's 
notification, or by an agreed upon substitute date, the Contracting 
Officer will terminate any item(s) for which additional funds have 
not been allotted, pursuant to the terms of this contract 
authorizing termination for the convenience of the Government. 
Failure to make the notification required by this paragraph, whether 
for reasons within or beyond the contractor's control, will not 
increase the maximum amount payable to the contractor under 
paragraphs (a) and (b) of this clause.
    (d) The Government may at any time prior to termination allot 
additional funds for the performance of the item(s) identified in 
paragraph (a) of this clause.
    (e) The termination provisions of paragraphs (a) through (h) of 
this clause do not limit the rights of the Government under the 
clause entitled ``Default'' or ``Termination for Cause.'' The 
provisions of this clause are limited to the work and allotment of 
funds for the item(s) set forth in paragraph (a) of this clause. 
This clause no longer applies once the contract is fully funded.
    (f) Nothing in this clause affects the right of the Government 
to terminate this contract pursuant to the Government's termination 
for convenience terms set forth in this contract.
    (g) Nothing in this clause shall be construed as authorization 
of voluntary services whose acceptance is otherwise prohibited under 
31 U.S.C. 1342.
    (h) The parties contemplate that the Government will allot funds 
to this contract from time to time as the need arises and as funds 
become available. There is no fixed schedule for providing 
additional funds.


(End of clause)

    Dated: June 23, 2016.
Iris B. Cooper,
Senior Procurement Executive, Office of the Procurement Executive.
[FR Doc. 2016-16346 Filed 7-11-16; 8:45 am]
 BILLING CODE P



                                                    45118                    Federal Register / Vol. 81, No. 133 / Tuesday, July 12, 2016 / Proposed Rules

                                                    outage, for all other forms of                              (2) Not later than 72 hours after                  You can make an appointment to
                                                    communications.                                          discovering the outage, BIAS providers                inspect comments by telephoning (202)
                                                    *      *      *     *    *                               and Dedicated Service providers, as                   622–0990. All comments, including
                                                       (g) Packet loss is defined as the loss                defined in § 4.3, shall submit                        attachments and other supporting
                                                    of one or more packets of data traveling                 electronically an Initial                             materials received are part of the public
                                                    across a network, which after being                      Communications Outage Report to the                   record and subject to public disclosure.
                                                    transmitted from a source, fail(s) to                    Commission. Not later than 30 days                    You should submit only information
                                                    reach the destination point designated                   after discovering the outage, the                     that you wish to make publicly
                                                    in the transmitting message.                             broadband Internet access service                     available.
                                                       (h) Latency is defined as the average                 provider shall submit electronically a                FOR FURTHER INFORMATION CONTACT:
                                                    time delay for a packet to travel from a                 Final Communications Outage Report to                 Thomas O’Linn, Procurement Analyst,
                                                    source to a destination.                                 the Commission. The Notification and                  Office of the Procurement Executive, at
                                                       (i) Throughput is the amount of                       the Initial and Final reports shall                   (202) 622–2092.
                                                    information transferred within a system                  comply with the requirements of § 4.11.
                                                                                                                                                                   SUPPLEMENTARY INFORMATION:
                                                    in a given amount of time.                               [FR Doc. 2016–16273 Filed 7–8–16; 11:15 am]
                                                    ■ 4. Section 4.9 is amended by revising                  BILLING CODE 6712–01–P                                Background
                                                    the heading of paragraph (g), paragraphs                                                                         The DTAR, which supplements the
                                                    (g)(1)(ii), (g)(2) and adding paragraph (i)                                                                    Federal Acquisition Regulation (FAR), is
                                                    to read as follows:                                      DEPARTMENT OF THE TREASURY                            codified at 48 CFR Chapter 10.
                                                                                                                                                                     The Anti-Deficiency Act, 31 U.S.C
                                                    § 4.9 Outage reporting requirements—
                                                                                                             48 CFR Parts 1032 and 1052                            1341 and the FAR section 32.702, state
                                                    threshold criteria.
                                                                                                                                                                   that no officer or employee of the
                                                    *       *    *     *     *                               Department of the Treasury                            government may create or authorize an
                                                       (g) Interconnected VoIP Service. (1)                  Acquisition Regulations; Incremental                  obligation in excess of the funds
                                                    * * *                                                    Funding of Fixed-Price, Time-and-                     available, or in advance of
                                                       (ii) Within 120 minutes of discovering                Material or Labor-Hour Contracts                      appropriations unless otherwise
                                                    that they have experienced on any                        During a Continuing Resolution                        authorized by law. A continuing
                                                    facilities that they own, operate, lease,                                                                      resolution (CR) provides funding for
                                                    or otherwise utilize, an outage of at least              AGENCY:    Department of the Treasury.
                                                                                                                                                                   continuing projects or activities that
                                                    30 minutes duration that:                                ACTION:   Proposed rule.
                                                                                                                                                                   were conducted in the prior fiscal year
                                                       (A) Potentially affects at least 900,000                                                                    for which appropriations, funds, or
                                                    user minutes of Interconnected VoIP                      SUMMARY:  This proposed rule would
                                                                                                             amend the Department of Treasury                      other authority was previously made
                                                    service and results in complete loss of                                                                        available.
                                                    service;                                                 Acquisition Regulation (DTAR) for the
                                                                                                             purposes of providing acquisition policy                Each CR is governed by its specific
                                                       (B) Potentially affects 22,500 Gbps                                                                         terms. However, amounts available
                                                    user minutes; or                                         for incremental funding of Fixed-Price,
                                                                                                             Time-and-Material or Labor-Hour                       under a CR are frequently insufficient to
                                                       (C) Potentially affects any special                                                                         fully fund contract actions that may be
                                                    offices and facilities (in accordance with               contracts during a continuing
                                                                                                             resolution.                                           required during its term. No existing
                                                    paragraphs (a) through (d) of § 4.5).                                                                          contract clause permits partial funding
                                                       (2) Not later than 72 hours after                     DATES:  Comment due date: September                   of a contract action awarded during a
                                                    discovering the outage, the provider                     12, 2016.                                             CR. While other strategies are available
                                                    shall submit electronically an Initial                   ADDRESSES: Treasury invites comments                  to address the need to take contract
                                                    Communications Outage Report to the                      on the topics addressed in this proposed              actions during a CR, these strategies—
                                                    Commission. Not later than 30 days                       rule. Comments may be submitted to                    for example short-term awards—are
                                                    after discovering the outage, the                        Treasury by any of the following                      inefficient and may have other
                                                    provider shall submit electronically a                   methods: by submitting electronic                     disadvantages.
                                                    Final Communications Outage Report to                    comments through the federal                            This proposal would establish
                                                    the Commission. The Notification and                     government e-rulemaking portal,                       policies and procedures in order to
                                                    the Initial and Final reports shall                      www.regulations.gov, by email to                      facilitate successful, timely, and
                                                    comply with the requirements of § 4.11.                  thomas.olinn@treasury.gov; or by                      economical execution of Treasury
                                                    *       *    *     *     *                               sending paper comments to Department                  contractual actions during a CR.
                                                       (i) BIAS or Dedicated Service                         of the Treasury, Office of the                        Specifically, this proposed rule would
                                                    providers. (1) All BIAS providers and                    Procurement Executive, Attn: Thomas                   set forth procedures for using
                                                    Dedicated Service providers, as defined                  O’Linn, 1722 I Street NW., Mezzanine—                 incremental funding for fixed-price,
                                                    in § 4.3 shall submit electronically a                   M12C, Washington, DC 20006.                           time-and-material and labor-hour
                                                    Notification to the Commission within                       In general, Treasury will post all                 contracts during a period in which
                                                    120 minutes of discovering that they                     comments to www.regulations.gov                       funds are provided to Treasury
                                                    have experienced on any facilities that                  without change, including any business                Departmental Offices or Bureaus under
                                                    they own, operate, lease, or otherwise                   or personal information provided, such                a CR. Heads of contracting activities
                                                    utilize, an outage of at least 30 minutes                as names, addresses, email addresses, or              may develop necessary supplemental
mstockstill on DSK3G9T082PROD with PROPOSALS




                                                    duration that:                                           telephone numbers. Treasury will also                 internal procedures as well as guidance
                                                       (A) Potentially affects at least 22,500               make such comments available for                      to advise potential offerors, offerors and
                                                    Gbps user minutes;                                       public inspection and copying in                      contractors of these policies and
                                                       (B) Potentially affects any special                   Treasury’s Library, Department of the                 procedures.
                                                    offices and facilities (in accordance with               Treasury, 1500 Pennsylvania Avenue
                                                    paragraphs (a) through (d) of § 4.5); or                 NW., Washington, DC 20220, on official                Regulatory Planning and Review
                                                       (C) Potentially affects a 911 special                 business days between the hours of                      This rule is not a significant
                                                    facility (as defined in (e) of § 4.5).                   10:00 a.m. and 5:00 p.m. Eastern Time.                regulatory action as defined in section


                                               VerDate Sep<11>2014   18:07 Jul 11, 2016   Jkt 238001   PO 00000   Frm 00049   Fmt 4702   Sfmt 4702   E:\FR\FM\12JYP1.SGM   12JYP1


                                                                              Federal Register / Vol. 81, No. 133 / Tuesday, July 12, 2016 / Proposed Rules                                           45119

                                                    3(f) of Executive Order 12866. Therefore                  procedures. Additionally, Bureaus who                   (6) The clause prescribed by
                                                    a regulatory assessment is not required.                  receive non-appropriated funds may                    1032.770–7 is incorporated into the
                                                                                                              utilize and tailor these policies and                 contract or order.
                                                    Regulatory Flexibility Act
                                                                                                              procedures to fit their needs.                          (b) Incremental funding may be
                                                       The Regulatory Flexibility Act (5                                                                            limited to individual line item(s) or a
                                                    U.S.C. chapter 6) generally requires                      1032.770–2       Definition.                          particular order(s).
                                                    agencies to conduct an initial regulatory                   ‘‘Continuing Resolution’’ means an
                                                    flexibility analysis and a final regulatory               appropriation, in the form of a joint                 1032.770–5       Limitations.
                                                    flexibility analysis of any rule subject to               resolution, that provides budget                         (a) This policy does not apply to
                                                    notice and comment rulemaking                             authority for federal agencies, specific              contract actions that are not covered by
                                                    requirements, unless the agency certifies                 activities, or both to continue operation             the CR.
                                                    that the rule will not have a significant                 until the regular appropriations are                     (b) If this policy is applied to non-
                                                    economic impact on a substantial                          enacted. Typically, a continuing                      severable services or to supplies, the
                                                    number of small entities. It is hereby                    resolution is used when legislative                   contracting officer shall take into
                                                    certified that this proposed rule would                   action on appropriations is not                       consideration the business risk to the
                                                    not have a significant economic impact                    completed by the beginning of a fiscal                Government if funding does not become
                                                    on a substantial number of small                          year.                                                 available to fully fund the contract. If
                                                    entities. The rule is intended to make                                                                          the contracting officer determines the
                                                    changes to the DTAR that would allow                      1032.770–3       General.                             use of incremental funding for non-
                                                    for improvements in continuity when                          The Anti-Deficiency Act, 31 U.S.C                  severable services or supplies is in the
                                                    Treasury funding is operating under a                     1341 and FAR 32.702, states that no                   best interest of the Government the
                                                    CR and should not have significant                        officer or employee of the Government                 contracting officer shall ensure the
                                                    economic impacts on small entities.                       may create or authorize an obligation in              contractor fully understands how the
                                                    Notwithstanding this certification, the                   excess of the funds available, or in                  limitations of the Government’s
                                                    Department welcomes comments on the                       advance of appropriations unless                      liabilities under the contract might
                                                    potential impact on small entities.                       otherwise authorized by law. A CR                     impact its ability to perform within the
                                                                                                              provides funding for continuing projects              prescribed contract schedule.
                                                    List of Subjects in 48 CFR Parts 1032                     or activities that were conducted in the
                                                    and 1052                                                  prior fiscal year for which                           1032.770–6       Procedures.
                                                      Government procurement.                                 appropriations, funds, or other authority                (a) An incrementally funded fixed-
                                                      Accordingly, the Department of the                      was previously made available. Each CR                price, time-and-materials or labor-hour
                                                    Treasury proposes to amend 48 CFR                         is governed by the specific terms in that             contract shall be fully funded once
                                                    Chapter 10 as follows:                                    specific CR (e.g. duration of the CR) and             funds are available.
                                                                                                              under certain CRs, the funding amounts                   (b) The contracting officer shall
                                                    PART 1032—CONTRACT FINANCING                              available for award of contract actions               ensure that sufficient funds are allotted
                                                                                                              are inadequate to fund the entire                     to the contract to cover the total amount
                                                    ■ 1. The authority citation for part 1032                 amounts needed for some contract                      payable to the contractor in the event of
                                                    continues to read as follows:                             actions.                                              termination of convenience by the
                                                        Authority: 41 U.S.C. 1707.                                                                                  Government.
                                                                                                              1032.770–4       Policy.                                 (c) Upon receipt of the contractor’s
                                                    ■ 2. Add subpart 1032.7 to read as
                                                    follows:                                                     (a) A fixed-price, time-and-materials              notice under paragraph (c) of the clause
                                                                                                              or labor-hour contract or order for                   at 1052.232–90, Limitation of
                                                    Subpart 1032.7—Contract Funding                           commercial or non-commercial supplies                 Government’s Obligation, the
                                                    Sec.                                                      or severable or non-severable services                contracting officer shall promptly
                                                    1032.770 Incremental funding during a                     may be incrementally funded when—                     provide written notice to the contractor
                                                         Continuing Resolution.                                  (1) Funds are provided to a Treasury               that the Government is—
                                                    1032.770–1 Scope of section.                              Departmental Office or Bureau under a                    (i) Obligating additional funds for
                                                    1032.770–2 Definition.
                                                    1032.770–3 General.
                                                                                                              CR. This includes funds appropriated to               continued performance and increasing
                                                    1032.770–4 Policy.                                        a bureau, funds appropriated to another               the Government’s limitation of
                                                    1032.770–5 Limitations.                                   entity that will be directly obligated on             obligation in a specified amount;
                                                    1032.770–6 Procedures.                                    a Treasury contract, and funds in a                      (ii) Obligating the full amount of
                                                    1032.770–7 Clause.                                        revolving fund or similar account that                funds needed;
                                                                                                              will be reimbursed by a customer                         (iii) Terminating for convenience, as
                                                    Subpart 1032.7—Contract Funding                           agency funded by a CR;                                applicable, the affected line items or
                                                    1032.770 Incremental funding during a                        (2) Sufficient funds are not being                 contract; or
                                                    Continuing Resolution.                                    allocated from the responsible fiscal                    (iv) Considering whether to allot
                                                                                                              authority to fully fund the contract                  additional funds; and
                                                    1032.770–1       Scope of section.                        action that is otherwise authorized to be                (A) The contractor is entitled by the
                                                      This section provides policy and                        issued;                                               contract terms to stop work when the
                                                    procedure for using incremental funding                      (3) There is no statutory restriction              Government’s limitation of obligation is
                                                    for fixed-price, time-and-material and                    that would preclude the proposed use of               reached; and
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                                                    labor-hour contracts during a period in                   funds;                                                   (B) Any costs expended beyond the
                                                    which funds are provided to Treasury                         (4) Funds are available and                        Government’s limitation of obligation
                                                    Departmental Offices or Bureaus, under                    unexpired, as of the date the funds are               are at the contractor’s risk.
                                                    a continuing resolution (CR). HCAs may                    obligated;                                               (d) Upon learning that the contract
                                                    develop necessary supplemental                               (5) Assurance is provided by the                   will receive no further funds by the date
                                                    internal procedures as well as guidance                   responsible financial authority that full             provided in the notice under paragraph
                                                    to advise potential offerors, offerors and                funding is anticipated once an                        (c) of the clause at 1052.232–70,
                                                    contractors of these policies and                         Appropriation Act is enacted; and                     Limitation of Government’s Obligation,


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                                                    45120                            Federal Register / Vol. 81, No. 133 / Tuesday, July 12, 2016 / Proposed Rules

                                                    the contracting officer shall promptly                                    operating under a CR (see 1032.770–4);                                   clause to specify the work required
                                                    give the contractor written notice of the                                 and                                                                      under the contract, in lieu of using
                                                    Government’s decision and terminate                                         (c) The CO shall insert the                                            contract line item numbers as well as
                                                    the affected line items or contract, as                                   information required in paragraph (a)                                    revise paragraph (c) of this paragraph to
                                                    applicable, for the convenience of the                                    and (c) of the clause.                                                   specify a different notification period
                                                    Government.                                                                                                                                        and percentage. The 30-day period may
                                                                                                                              PART 1052—SOLICITATION                                                   be varied from 45, 60 to 90 days, and
                                                    1032.770–7         Clause.                                                PROVISIONS AND CONTRACT                                                  the 75 percent from 75 to 85 percent:
                                                                                                                              CLAUSES
                                                       The contracting officer shall insert the                                                                                                        LIMITATION OF GOVERNMENT’S
                                                    clause at 1052.232–70, Limitation of                                      ■ 3. The authority citation for part 1032                                OBLIGATION (TBD 2016)
                                                    Government’s Obligation, in                                               continues to read as follows:
                                                                                                                                                                                                         (a) Funding is not currently available to
                                                       (a) Solicitations and resultant                                            Authority: 41 U.S.C. 1707.                                           fully fund this contract due to the
                                                    contracts when incremental funding of                                     ■ 4. Add 1052.232–70 to subpart 1052.2                                   Government operating under a continuing
                                                    fixed-price, time-and-material or labor-                                  to read as follows:                                                      resolution (CR). The item(s) listed in the table
                                                    hour contract via a CR is anticipated; or                                                                                                          below are being incrementally funded as
                                                                                                                              1052.232–70             Limitation of Government’s                       described below. The funding allotted to
                                                       (b) Contracts or orders when                                           Obligation.                                                              these item(s) is presently available for
                                                    incremental funding of a fixed-price,                                       As prescribed in 1032.770–7, insert                                    payment and allotted to this contract. This
                                                    time-and-material or labor-hour contract                                  the following clause. Contracting                                        table will be updated by a modification to the
                                                    is authorized and the Treasury                                            officers are authorized, in appropriate                                  contract when additional funds are made
                                                    Departmental Office or Bureau is                                          cases, to revise paragraph (a) of this                                   available, if any, to this contract.

                                                                                                                                                                                                                                              Funds
                                                                                                                                                                                                                          Funds           required for
                                                                                                      Contract line item number                                                                        CLIN total       allotted to         complete
                                                                                                                (CLIN)                                                                                   price          the CLIN           funding of
                                                                                                                                                                                                                                            the CLIN

                                                                                                                                                                                                           $                 $                 $
                                                                                                                                                                                                           $                 $                 $
                                                                                                                                                                                                           $                 $                 $
                                                                                                                                                                                                           $                 $                 $

                                                         Totals ....................................................................................................................................       $                 $                 $



                                                       (b) For the incrementally funded item(s)                               cost for termination for convenience, will                                  (e) The termination provisions of
                                                    identified in paragraph (a) of this clause, the                           approximate 85 percent of the total amount                               paragraphs (a) through (h) of this clause do
                                                    Contractor agrees to perform up to the point                              then allotted to the contract for performance                            not limit the rights of the Government under
                                                    at which the total amount payable by the                                  of the item(s) identified in paragraph (a) of                            the clause entitled ‘‘Default’’ or ‘‘Termination
                                                    government, including any invoice payments                                this clause. The notification shall state the                            for Cause.’’ The provisions of this clause are
                                                    to which the contractor is entitled and                                   estimated date when that point will be                                   limited to the work and allotment of funds
                                                    reimbursement of authorized termination                                   reached and an estimate of additional                                    for the item(s) set forth in paragraph (a) of
                                                    costs in the event of termination of those                                funding, if any, needed to continue                                      this clause. This clause no longer applies
                                                    item(s) for the Government’s convenience,                                 performance. The notification shall also                                 once the contract is fully funded.
                                                    does not exceed the total amount currently                                advise the Contracting Officer of the                                       (f) Nothing in this clause affects the right
                                                    obligated to those item(s). The Contractor is                             estimated amount of additional funds                                     of the Government to terminate this contract
                                                    not authorized to continue work on these                                  required for the timely performance of the                               pursuant to the Government’s termination for
                                                    item(s) beyond that point. The Government                                 item(s) funded pursuant to this contract. If                             convenience terms set forth in this contract.
                                                    will not be obligated in any event to                                     after such notification additional funds are                                (g) Nothing in this clause shall be
                                                    reimburse the contractor in excess of the                                 not allotted by the date identified in the                               construed as authorization of voluntary
                                                    amount allotted to the line items of the                                  Contractor’s notification, or by an agreed                               services whose acceptance is otherwise
                                                    contract regardless of anything to the                                    upon substitute date, the Contracting Officer                            prohibited under 31 U.S.C. 1342.
                                                    contrary in any other clause, including but                               will terminate any item(s) for which                                        (h) The parties contemplate that the
                                                    not limited to the clause entitled                                        additional funds have not been allotted,                                 Government will allot funds to this contract
                                                    ‘‘Termination for Convenience of the                                      pursuant to the terms of this contract                                   from time to time as the need arises and as
                                                    Government’’ or paragraph (1) entitled                                    authorizing termination for the convenience                              funds become available. There is no fixed
                                                    ‘‘Termination for the Government’s                                        of the Government. Failure to make the                                   schedule for providing additional funds.
                                                    Convenience’’ of the clause at FAR 52.212–                                notification required by this paragraph,
                                                    4, ‘‘Commercial Terms and Conditions—                                     whether for reasons within or beyond the                                 (End of clause)
                                                    Commercial Items.’’                                                       contractor’s control, will not increase the                                 Dated: June 23, 2016.
                                                       (c) Notwithstanding paragraph (h) of this                              maximum amount payable to the contractor                                 Iris B. Cooper,
                                                    clause, the Contractor shall notify the                                   under paragraphs (a) and (b) of this clause.
                                                    Contracting Officer in writing at least thirty                               (d) The Government may at any time prior                              Senior Procurement Executive, Office of the
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                                                    days prior to the date when, in the                                       to termination allot additional funds for the                            Procurement Executive.
                                                    Contractor’s best judgment, the work will                                 performance of the item(s) identified in                                 [FR Doc. 2016–16346 Filed 7–11–16; 8:45 am]
                                                    reach the point at which the total amount                                 paragraph (a) of this clause.                                            BILLING CODE P
                                                    payable by the Government, including any




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Document Created: 2016-07-12 01:59:01
Document Modified: 2016-07-12 01:59:01
CategoryRegulatory Information
CollectionFederal Register
sudoc ClassAE 2.7:
GS 4.107:
AE 2.106:
PublisherOffice of the Federal Register, National Archives and Records Administration
SectionProposed Rules
ActionProposed rule.
ContactThomas O'Linn, Procurement Analyst, Office of the Procurement Executive, at (202) 622-2092.
FR Citation81 FR 45118 
CFR Citation48 CFR 1032
48 CFR 1052

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