81 FR 8671 - Cooperative Agreements With Commercial Firms

NATIONAL AERONAUTICS AND SPACE ADMINISTRATION

Federal Register Volume 81, Issue 34 (February 22, 2016)

NASA is proposing to amend its regulations to implement section 872 of the National Defense Authorization Act for Fiscal Year 2009, as the statute applies to grants and cooperative agreements. The revision is part of NASA's retrospective plan under Executive Order (EO) 13563 completed in August 2011.

[Federal Register Volume 81, Number 34 (Monday, February 22, 2016)]
[Proposed Rules]
[Pages 8671-8675]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2016-02979]


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NATIONAL AERONAUTICS AND SPACE ADMINISTRATION

14 CFR Part 1274

[NASA Case 2015-N014]
RIN 2700-AE25


Cooperative Agreements With Commercial Firms

AGENCY: National Aeronautics and Space Administration.

ACTION: Proposed rule.

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SUMMARY: NASA is proposing to amend its regulations to implement 
section 872 of the National Defense Authorization Act for Fiscal Year 
2009, as the statute applies to grants and cooperative agreements. The 
revision is part of NASA's retrospective plan under Executive Order 
(EO) 13563 completed in August 2011.

DATES: Comments on the proposed rule should be submitted in writing to 
the address shown below on or before April 22, 2016, to be considered 
in the formation of a final rule.

ADDRESSES: Submit comments identified by NASA Case 2015-N014, using any 
of the following methods:
    [cir] Regulations.gov: http://www.regulations.gov. Submit comments 
via the Federal eRulemaking portal by entering ``NASA Case 2015-N014'' 
under the heading ``Enter keyword or

[[Page 8672]]

ID'' and selecting ``Search.'' Select the link ``Submit a Comment'' 
that corresponds with ``NASA Case 2015-N014.'' Follow the instructions 
provided at the ``Submit a Comment'' screen. Please include your name, 
company name (if any), and ``NASA Case 2015-N014'' on your attached 
document.
    [cir] Email: Comments may be sent to Barbara J. Orlando. Include 
NASA Case 2015-N014 in the subject line of the message.
    [cir] Fax: (202) 358-3082.
    [cir] Mail: National Aeronautics and Space Administration, 
Headquarters, Office of Procurement, Contract and Grant Policy 
Division, Attn: Barbara J. Orlando, Room 5L32, 300 E Street SW., 
Washington, DC 20546-0001.
    Comments received generally will be posted without change to http://www.regulations.gov, including any personal information provided. To 
confirm receipt of your comment(s), please check www.regulations.gov, 
approximately two to three days after submission to verify posting 
(except allow 30 days for posting of comments submitted by mail).

FOR FURTHER INFORMATION CONTACT: Barbara J. Orlando, NASA HQ, Office of 
Procurement, Contract and Grant Policy Division, Room 5L32, 300 E 
Street SW., Washington, DC 20456-0001. Telephone 202-358-3740; 
facsimile 202-358-3082.

SUPPLEMENTARY INFORMATION: 

I. Background

    NASA is proposing to revise 14 CFR part 1274, to implement Section 
872 of the Duncan Hunter National Defense Authorization Act (NDAA) for 
Fiscal Year (FY) 2009 (Pub. L. 110-417, codified as amended at 41 
U.S.C. 2313), which established a database that includes governmentwide 
data with specified information related to the integrity and 
performance of entities awarded Federal grants and contracts.
    On July 22, 2015, the Office of Management and Budget (OMB) issued 
final guidance, Guidance for Reporting and Use of Information 
Concerning Recipient Integrity and Performance (https://www.thefederalregister.org/fdsys/pkg/FR-2015-07-22/pdf/2015-17753.pdf) to Federal agencies to 
implement section 872 of the NDAA for FY 2009, (hereafter referred to 
as ``section 872'') for grants and cooperative agreements that were 
subject to the regulations published under 2 CFR part 200. Pursuant to 
section 872, OMB and the General Services Administration (GSA) 
established an integrity and performance system that includes 
government-wide data with specified information related to the 
integrity and performance of entities awarded Federal grants, 
cooperative agreements, and contracts. This system, as the Federal 
Awardee Performance and Integrity Information System (FAPIIS), 
integrates various sources of information on the eligibility of 
organizations for Government awards and is currently available at 
https://www.fapiis.gov.
    This rule proposes to implement the requirements of section 872 for 
recipients and NASA staff to report information that will appear in 
FAPIIS. In addition, section 872 requires NASA to consider information 
contained within the system about a non-Federal entity before awarding 
a grant or cooperative agreement to that non-Federal entity. The 
proposed rule also addresses how FAPIIS and other information may be 
used in assessing recipient integrity.
    The major elements proposed in this rule are as follows:
     NASA is to report information in FAPIIS about--
    [ssquf] Any termination of an award due to a material failure to 
comply with the award terms and conditions;
    [ssquf] Any administrative agreement with a non-Federal entity to 
resolve a suspension or debarment proceeding; and
    [ssquf] Any finding that a non-Federal entity is not qualified to 
receive a given award, if the finding is based on criteria related to 
the non-Federal entity's integrity or prior performance under Federal 
awards and it is anticipated that the total Federal funding will exceed 
the simplified threshold during the period of performance.
     Recipients that have Federal contract, grant, and 
cooperative agreement awards with a cumulative total value greater than 
$10,000,000 must enter information in FAPIIS about certain civil, 
criminal, and administrative proceedings that reached final disposition 
within the most recent five year period and that were connected with 
the award or performance of a Federal award.
     Recipients that have been awarded a Federal contract, 
grant, and cooperative agreement with a cumulative total value greater 
than $10,000,000 are required to disclose semiannually the information 
about the criminal, civil, and administrative proceedings as described 
in section 872 (c).
     Federal awarding agencies, prior to making an award to a 
non-Federal entity, must review FAPIIS to determine whether that non-
Federal entity is qualified to receive the Federal award. In making the 
determination, NASA must take into consideration any information about 
the entity that is in FAPIIS.
     Notice of funding opportunities and Federal award terms 
and conditions to inform a non-Federal entity that it may submit 
comments in FAPIIS about any information that NASA had reported to the 
system about the non-Federal entity, for consideration by NASA in 
making future Federal awards to the non-Federal entity.

II. Discussion

    Section 872 applies without distinguishing between for-profit and 
other recipients. Thus agencies must apply the requirements reflected 
in this guidance to for-profit recipients by way of agency regulations, 
policies, or directly through the terms and conditions of Federal 
awards.
    NASA grants and cooperative agreements to commercial firms, when 
cost share is required, are not covered under 2 CFR 200, but under 
regulations promulgated in 14 CFR 1274. Accordingly, NASA is proposing 
to amend 14 CFR 1274, Cooperative Agreements with Commercial Firms, to 
incorporate the new guidelines implementing section 872.

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

IV. Paperwork Reduction Act

    The rule contains collection requirements that require the approval 
of the Office of Management and Budget under the Paperwork Reduction 
Act (44 U.S.C. chapter 35); however, these changes to 14 CFR 1274 do 
not impose additional information collection requirements to the 
paperwork burden previously approved under OMB Control Number 3090-
0293, titled Reporting and Use of Information Concerning Integrity and 
Performance

[[Page 8673]]

of Recipients of Grants and Cooperative Agreements.

List of Subjects in 14 CFR Part 1274

    Government financial assistance.

Manuel Qui[ntilde]ones,
NASA Federal Register Liaison.

    Accordingly, 14 CFR part 1274 is proposed to be amended as follows:

PART 1274--COOPERATIVE AGREEMENTS WITH COMMERCIAL FIRMS

0
1. The authority citation for 14 CFR part 1274 continues to read as 
follows:

    Authority: 51 U.S.C. 20113(e) and 31 U.S.C. 6301 to 6308; 51 
U.S.C. 20102, et seq.

0
2. Amend Sec.  1274.203 by adding paragraph (g) to read as follows:


Sec.  1274.203  Solicitations/cooperative agreement notices.

* * * * *
    (g) If NASA anticipates that the total Federal share of any award 
made under a funding agreement may exceed, over the period of 
performance, the simplified acquisition threshold, the notice of 
funding opportunity must include the information as required in 
Appendix 1 to Part 200, paragraph E.3, paragraph E.4, and paragraph F.3
0
3. Amend Sec.  1274.209 by redesignating paragraphs (e) through (l) as 
(f) through (m), respectively and adding a new paragraph (e) to read as 
follows:


Sec.  1274.209  Evaluation and selection.

* * * * *
    (e)(1) Prior to making a Federal award, agreement officers are 
required by 31 U.S.C. 3321 and 41 U.S.C. 2313 note, to review 
information available through any OMB-designated repositories of 
governmentwide eligibility qualification, currently the System of Award 
Management (SAM), or financial integrity information (currently Federal 
Awardee Performance and Integrity Information System (FAPIIS)), as 
appropriate. See also suspension and debarment requirements at 2 CFR 
part 180 as well as individual Federal agency suspension and debarment 
regulations in title 2 of the Code of Federal Regulations.
    (2) In accordance with 41 U.S.C. 2313, agreement officers are 
required to review the non-public segment of FAPIIS prior to making a 
Federal award where the Federal share is expected to exceed the 
simplified acquisition threshold, defined in 41 U.S.C. 134, over the 
period of performance. At a minimum, the information in the system for 
a prior Federal award recipient must demonstrate a satisfactory record 
of executing programs or activities under Federal grants, cooperative 
agreements, or procurement awards; and integrity and business ethics. 
NASA may make a Federal award to a recipient who does not fully meet 
these standards, if it is determined that the information is not 
relevant to the current Federal award under consideration or there are 
specific conditions that can appropriately mitigate the effects of the 
non-Federal entity's risk in accordance with 2 CFR 200 section 200.207, 
Specific conditions.
* * * * *
0
4. Amend Sec.  1274.211 by:
0
a. In paragraph (c), removing ``Central Contractor Registration (CCR)'' 
and adding ``System for Award Management (SAM)''; removing ``Department 
of Defense (DOD) Central Contractor Registration (CCR)'' and adding 
``System for Award Management''; removing ``CCR'' and adding ``SAM''; 
and removing ``http://www.ccr2000.com or by calling toll free: 888-227-
2423, commercial: 616-961-5757'' and adding ``sam.gov'' in its place; 
and
0
b. Adding paragraph (d)(5) to read as follows:


Sec.  1274.211  Award procedures.

* * * * *
    (d) * * *
    (5) The non-Federal entity or applicant for a Federal award must 
disclose, in a timely manner, in writing to the assigned agreement 
officer or pass-through entity all violations of Federal criminal law 
involving fraud, bribery, or gratuity violations potentially affecting 
the Federal award. Non-Federal entities that have received a Federal 
award including the term and condition outlined in Appendix XII--Award 
Term and Condition for Recipient Integrity and Performance Matters are 
required to report certain civil, criminal, or administrative 
proceedings to SAM. Failure to make required disclosures can result in 
any of the remedies described in Sec.  200.338 Remedies for 
noncompliance, including suspension or debarment. (See also 2 CFR part 
180, 31 U.S.C. 3321, and 41 U.S.C. 2313.)
0
5. Amend Sec.  1274.212 by revising the section heading and adding 
paragraph (c) to read as follows:


Sec.  1274.212  Award information.

* * * * *
    (c) Recipient integrity and performance matters. If the total 
Federal share of the Federal award is more than $500,000 over the 
period of performance, agreement officers must include the terms and 
conditions in Sec.  1274.944 of this chapter.
0
6. Amend subpart 1274.3 by adding new Sec. Sec.  1274.303 and 1274.304 
to read as follows:


Sec.  1274.303  Public access to Federal award information.

    (a) In accordance with statutory requirements for Federal spending 
transparency (e.g., FFATA), except as noted in this section, for 
applicable Federal awards NASA must announce all Federal awards 
publicly and publish the required information at www.USAspending.gov.
    (b) All information posted in FAPIIS, accessible through SAM, on or 
after April 15, 2011 will be publicly available after a waiting period 
of 14 calendar days, except for--
    (1) Past performance reviews required by Federal Government 
contractors in accordance with the Federal Acquisition Regulation (FAR) 
42.15;
    (2) Information that was entered prior to April 15, 2011; or
    (3) Information that is withdrawn during the 14-calendar day 
waiting period by the Federal Government official.
    (c) Nothing in this section may be construed as requiring the 
publication of information otherwise exempt under the Freedom of 
Information Act (5 U.S.C. 552), or controlled unclassified information 
pursuant to Executive Order 13556.


Sec.  1274.304  Reporting a determination that a non-Federal entity is 
not qualified for a Federal award.

    (a) If NASA does not make a Federal award to a non-Federal entity 
because the agreement officer determines that the non-Federal entity 
does not meet either or both of the minimum qualification standards, as 
described in paragraph (a)(2) of title 2 CFR part 200 section 200.205, 
the agreement officer must report that determination in FAPIIS, 
accessible through SAM, only if all of the following apply:
    (1) The only basis for the determination described in paragraph (a) 
of this section is the non-Federal entity's prior record of executing 
programs or activities under Federal awards or its record of integrity 
and business ethics, as described in paragraph (a)(2) of 2 CFR 200.205, 
(i.e., the entity was determined to be qualified based on all factors 
other than those two standards); and
    (2) The total Federal share of the Federal award that otherwise 
would be made to the non-Federal entity is expected to exceed the 
simplified acquisition threshold over the period of performance.
    (b) Agreement officers are not required to report a determination 
that

[[Page 8674]]

a non-Federal entity is not qualified for a Federal award if they make 
the Federal award to the non-Federal entity and includes specific award 
terms and conditions (see CFR 1274.209).
    (c) If the agreement officer reports a determination that a non-
Federal entity is not qualified for a Federal award, as described in 
paragraph (a) of this section, the agreement officer also must notify 
the non-Federal entity that--
    (1) The determination was made and reported to FAPIIS, accessible 
through SAM, and include with the notification an explanation of the 
basis for the determination;
    (2) The information will be kept in the system for a period of five 
years from the date of the determination, as required by section 872 of 
Public Law 110-417, as amended (41 U.S.C. 2313), then archived;
    (3) Agreement officers making a Federal award to the non-Federal 
entity during that five year period must consider the information found 
in FAPIIS when judging whether the non-Federal entity is qualified to 
receive the Federal award when the total Federal share of the Federal 
award is expected to include an amount of Federal funding in excess of 
the simplified acquisition threshold over the period of performance of 
the award;
    (4) The non-Federal entity may go to the awardee integrity and 
performance portal accessible through SAM (currently the Contractor 
Performance Assessment Reporting System (CPARS)) and comment on any 
information the system contains about the non-Federal entity itself; 
and
    (5) Agreement officers will consider that non-Federal entity's 
comments in determining whether the non-Federal entity is qualified for 
a future Federal award.
    (d) If the agreement officer enters information into FAPIIS about a 
determination that a non-Federal entity is not qualified for a Federal 
award and subsequently--
    (1) Learns that any of that information is erroneous, the agreement 
officer must correct the information in the system within three 
business days; and
    (2) Obtains an update to that information that could be helpful to 
other Federal awarding agencies, the agreement officer is strongly 
encouraged to amend the information in the system to incorporate the 
update in a timely way.
    (e) The agreement officer shall not post any information that will 
be made publicly available in the non-public segment of designated 
integrity and performance system that is covered by a disclosure 
exemption under the Freedom of Information Act. If the recipient 
asserts within seven calendar days to NASA that some or all of the 
information made publicly available is covered by a disclosure 
exemption under the Freedom of Information Act, agreement officers must 
remove the posting within seven calendar days of receiving the 
assertion. Prior to reposting the releasable information, agreement 
officers must resolve the issue in accordance with the agency's Freedom 
of Information Act procedures.
0
7. Amend section 1274.701 by adding paragraphs (b)(5) through (b)(8), 
(c), and (d) to read as follows:


1274.701  Suspension or termination.

* * * * *
    (b) * * *
    (5) When NASA terminates a Federal award prior to the end of the 
period of performance due to the non-Federal entity's material failure 
to comply with the Federal award terms and conditions, NASA must report 
the termination in FAPIIS.
    (6) The information required under paragraph (b) of this section is 
not to be reported to designated integrity and performance system until 
the non-Federal entity either--
    (i) Has exhausted its opportunities to object or challenge the 
decision, see Sec.  200.341 Opportunities to object, hearings and 
appeals; or
    (ii) Has not, within 30 calendar days after being notified of the 
termination, informed the agreement officer that it intends to appeal 
the decision to terminate.
    (7) If the agreement officer, after entering information into 
FAPIIS about a termination, subsequently:
    (i) Learns that any of that information is erroneous, the agreement 
officer must correct the information in the system within three 
business days;
    (ii) Obtains an update to that information that could be helpful to 
other Federal awarding agencies, the agreement officer is strongly 
encouraged to amend the information in the system to incorporate the 
update in a timely way.
    (8) Agreement officers shall not post any information that will be 
made publicly available in the non-public segment of designated 
integrity and performance system that is covered by a disclosure 
exemption under the Freedom of Information Act. If the non-Federal 
entity asserts within seven calendar days to the Federal awarding 
agency who posted the information that some of the information made 
publicly available is covered by a disclosure exemption under the 
Freedom of Information Act, agreement officers must remove the posting 
within seven calendar days of receiving the assertion. Prior to 
reposting the releasable information, agreement officers must resolve 
the issue in accordance with the agency's Freedom of Information Act 
procedures.
    (c) When a Federal award is terminated or partially terminated, 
both NASA or the pass-through entity and the non-Federal entity remain 
responsible for compliance with the closeout and post-closeout 
requirements and continuing responsibilities.
    (d) Notification of termination requirement. If the Federal award 
is terminated for the non-Federal entity's material failure to comply 
with the Federal statutes, regulations, or terms and conditions of the 
Federal award, the notification must state that--
    (1) The termination decision will be reported in FAPIIS, accessible 
through SAM;
    (2) The information will be available in FAPIIS for a period of 
five years from the date of the termination, then archived;
    (3) When considering making a Federal award to the non-Federal 
entity during that five year period, NASA must consider that 
information in judging whether the non-Federal entity is qualified to 
receive the Federal award, when the Federal share of the Federal award 
is expected to exceed the simplified acquisition threshold over the 
period of performance;
    (4) The non-Federal entity may comment on any information that the 
OMB-designated integrity and performance system contains about the non-
Federal entity for future consideration by NASA. The non-Federal entity 
may submit comments to the awardee integrity and performance portal 
accessible through SAM (currently (CPARS).
    (5) Agreement officers will consider non-Federal entity comments 
when determining whether the non-Federal entity is qualified for a 
future Federal award.
0
8. Add Sec.  1274.803 to read as follows:


Sec.  1274.803  Suspension and Debarment.

    Non-federal entities are subject to the non-procurement debarment 
and suspension regulations implementing Executive Orders 12549 and 
12689, 2 CFR part 180, adopted by NASA at 2 CFR part 1880. These 
regulations restrict awards, subawards, and contracts with certain 
parties that are debarred, suspended, or otherwise excluded from or 
ineligible for participation in Federal assistance programs or 
activities.

[[Page 8675]]

0
9. Amend subpart 1274.9 by adding Sec.  1274.944 to read as follows:


Sec.  1274.944  Award term and condition for recipient integrity and 
performance matters.

    (a) Reporting of matters related to recipient integrity and 
performance.
    (1) General reporting requirement.
    (i) If the total value of your currently active grants, cooperative 
agreements, and procurement contracts from all Federal awarding 
agencies exceeds $10,000,000 for any period during the period of 
performance of this Federal award, then you as the recipient during 
that period of time must maintain the currency of information reported 
in FAPIIS about civil, criminal, or administrative proceedings 
described in paragraph 2 of this award term and condition. This is a 
statutory requirement under section 872 of Public Law 110-417, as 
amended (41 U.S.C. 2313).
    (ii) As required by section 3010 of Public Law 111-212, all 
information posted in FAPIIS on or after April 15, 2011, except past 
performance reviews required for Federal procurement contracts, will be 
publicly available.
    (2) Proceedings about which you must report. Submit the information 
required about each proceeding that--
    (i) Is in connection with the award or performance of a grant, 
cooperative agreement, or procurement contract from the Federal 
Government;
    (ii) Reached its final disposition during the most recent five year 
period; and
    (iii) Is one of the following:
    (A) A criminal proceeding that resulted in a conviction, as defined 
in paragraph (a)(2)(iii)(A)(5) of this section.
    (B) A civil proceeding that resulted in a finding of fault and 
liability and payment of a monetary fine, penalty, reimbursement, 
restitution, or damages of $5,000 or more.
    (C) An administrative proceeding, as defined in paragraph 
(a)(2)(iii)(A)(5) of this section, that resulted in a finding of fault 
and liability and your payment of either a monetary fine or penalty of 
$5,000 or more or reimbursement, restitution, or damages in excess of 
$100,000.
    (D) Any other criminal, civil, or administrative proceeding if--
    (1) It could have led to an outcome described in paragraph 
(a)(2)(iii)(A), (B), or (C) of this section;
    (2) It had a different disposition arrived at by consent or 
compromise with an acknowledgment of fault on your part; and
    (3) The requirement in this award term and condition to disclose 
information about the proceeding does not conflict with applicable laws 
and regulations.
    (3) Reporting procedures. Enter in the SAM Entity Management area 
the information that SAM requires about each proceeding described in 
paragraph (a)(2)(iii)(A)(5) of this section. You do not need to submit 
the information a second time under assistance awards that you received 
if you already provided the information through SAM, because you were 
required to do so under Federal procurement contracts that you were 
awarded.
    (4) Reporting frequency. During any period of time when you are 
subject to the requirement in paragraph (a)(1) of this section, you 
must report proceedings information through SAM for the most recent 
five year period, either to report new information about any 
proceeding(s) that you have not reported previously or affirm that 
there is no new information to report. Recipients that have Federal 
contract, grant, and cooperative agreement awards with a cumulative 
total value greater than $10,000,000 must disclose semiannually any 
information about the criminal, civil, and administrative proceedings.
    (5) Definitions. For purposes of this award term and condition:
    (i) Administrative proceeding means a non-judicial process that is 
adjudicatory in nature in order to make a determination of fault or 
liability (e.g., Securities and Exchange Commission Administrative 
proceedings, Civilian Board of Contract Appeals proceedings, and Armed 
Services Board of Contract Appeals proceedings). This includes 
proceedings at the Federal and State level but only in connection with 
performance of a Federal contract or grant. It does not include audits, 
site visits, corrective plans, or inspection of deliverables.
    (ii) Conviction, for purposes of this award term and condition, 
means a judgment or conviction of a criminal offense by any court of 
competent jurisdiction, whether entered upon a verdict or a plea, and 
includes a conviction entered upon a plea of nolo contendere.
    (6) Total value of currently active grants, cooperative agreements, 
and procurement contracts includes--
    (i) Only the Federal share of the funding under any Federal award 
with a recipient cost share or match; and
    (ii) The value of all expected funding increments under a Federal 
award and options, even if not yet exercised.

[FR Doc. 2016-02979 Filed 2-19-16; 8:45 am]
 BILLING CODE 7510-13-P