[Federal Register: August 2, 2007 (Volume 72, Number 148)]
[Rules and Regulations]
[Page 42313-42315]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr02au07-13]
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DEPARTMENT OF DEFENSE
Defense Acquisition Regulations System
48 CFR Parts 202, 210, 213, 215, and 219
RIN 0750-AF36
Defense Federal Acquisition Regulation Supplement; Limitations on
Tiered Evaluation of Offers (DFARS Case 2006-D009)
AGENCY: Defense Acquisition Regulations System, Department of Defense
(DoD).
ACTION: Final rule.
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SUMMARY: DoD has adopted as final, with changes, an interim rule
amending the Defense Federal Acquisition Regulation Supplement (DFARS)
to implement Section 816 of the National Defense Authorization Act for
Fiscal Year 2006. Section 816 requires DoD to prescribe guidance on the
use of tiered evaluation of offers for contracts and for task or
delivery orders under contracts.
DATES: Effective Date: August 2, 2007.
FOR FURTHER INFORMATION CONTACT: Ms. Deborah Tronic, Defense
Acquisition Regulations System, OUSD(AT&L)DPAP(DARS), IMD 3C132, 3062
Defense Pentagon, Washington, DC 20301-3062. Telephone (703) 602-0289;
facsimile (703) 602-7887. Please cite DFARS Case 2006-D009.
SUPPLEMENTARY INFORMATION:
A. Background
DoD published an interim rule at 71 FR 53042 on September 8, 2006,
to implement Section 816 of the National Defense Authorization Act for
Fiscal Year 2006 (Pub. L. 109-163). Section
[[Page 42314]]
816 requires DoD to prescribe guidance on the use of tiered evaluation
of offers for contracts and for task or delivery orders under
contracts. The guidance must include a prohibition on the use of tiered
evaluation of offers unless the contracting officer (1) has conducted
market research in accordance with Part 10 of the Federal Acquisition
Regulation (FAR); (2) is unable, after conducting market research, to
determine whether or not a sufficient number of qualified small
businesses are available to justify limiting competition for the
contract or order; and (3) includes in the contract file a written
explanation of why the contracting officer was unable to make the
determination.
Four sources submitted comments on the interim rule. A discussion
of the comments is provided below. In addition to the changes addressed
in the DoD response to Comment 1, the final rule revises section
213.106-1-70 to provide a cross-reference to section 215.203-70,
instead of duplicating the text found in that section.
1. Comment: The rule failed to include an explicit prohibition.
DoD Response: While DoD believes that stating the actions that the
contracting officer must take before using tiered evaluation is an
implied prohibition, the final rule contains amendments at 215.203-70
to explicitly prohibit the contracting officer from using tiered
evaluation unless those actions have been taken.
2. Comment: Defining the technique of tiered evaluation in the
DFARS legitimizes the use of tiered evaluation.
DoD Response: The statute does not completely prohibit the use of
tiered evaluation; it requires that certain actions be taken before
this technique may be used. To permit an understanding of the statutory
requirements, the technique must first be defined.
3. Comment: FAR Part 10 already requires the market research
required by the statute, and no additional research is necessary.
DoD Response: DoD agrees that the FAR already requires agencies to
conduct market research appropriate to the circumstances before
soliciting offers for acquisitions in excess of the simplified
acquisition threshold and, when necessary and cost-effective, below the
simplified acquisition threshold. However, DoD believes the additional
language in DFARS Part 210 is appropriate to reinforce the statutory
requirement for market research before conducting a tiered evaluation
of offers.
4. Comment: The phrase ``appropriate to the circumstances'' at
DFARS 210.001(a)(i), with regard to requirements for conducting market
research, should be deleted. Although the phrase is consistent with the
FAR, it is not in the statute being implemented and creates ambiguity.
DoD Response: The text at DFARS 210.001 is consistent with both the
statute and FAR Part 10. The statute prohibits the use of tiered
evaluation of offers unless, among other things, the contracting
officer has conducted market research in accordance with Part 10 of the
FAR. The implementing DFARS language reflects the policy in FAR Part
10, requiring the conduct of market research ``appropriate to the
circumstances.'' The DFARS language recognizes that there are many ways
to conduct market research, and that the methods employed should be
those that will be effective for the particular acquisition.
5. Comment: The rule states that the tiered evaluation of offers
order of precedence shall be consistent with FAR Part 19. However, FAR
Part 19 does not provide an ``order of precedence'' among the various
small business goals.
DoD Response: FAR Part 19 does not specifically state an order of
precedence. However, it does provide direction on the circumstances
under which acquisitions may or must be set aside for various
categories of small businesses. For example, FAR 19.1305 states that
the contracting officer must consider HUBZone set-asides for
acquisitions at a certain dollar level before considering small
business set-asides. DoD believes that, in establishing an order of
precedence in a tiered evaluation of offers, that order of precedence
must be consistent with the direction in FAR Part 19.
6. Comment: Guidance to the contracting officer can be addressed in
the Procedures, Guidance, and Information (PGI), consistent with the
law.
DoD Response: PGI guidance to supplement this rule is considered
unnecessary at this time.
7. Comment: The rule should include coverage stating that a large
business involved in an 8(a) mentor-protege agreement shall not offer
itself as a large business in competition against the 8(a) mentor-
protege agreement. In a recent cascading set-aside, a large business
offered itself as a large entity, as a subcontractor to a small
business, and as a mentor in an 8(a) mentor-protege joint venture.
DoD Response: The issue of a mentor firm competing against a
protege firm is not specific to tiered evaluation of offers. Therefore,
the final rule contains no change relating to this comment.
This rule was not subject to Office of Management and Budget review
under Executive Order 12866, dated September 30, 1993.
B. Regulatory Flexibility Act
DoD certifies that this final rule will not 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 rule relates to market research and documentation
requirements performed by the Government.
C. Paperwork Reduction Act
The Paperwork Reduction Act does not apply, because the rule does
not impose any information collection requirements that require the
approval of the Office of Management and Budget under 44 U.S.C. 3501,
et seq.
List of Subjects in 48 CFR Parts 202, 210, 213, 215, and 219
Government procurement.
Michele P. Peterson,
Editor, Defense Acquisition Regulations System.
0
Accordingly, the interim rule amending 48 CFR parts 202, 210, 213, 215,
and 219, which was published at 71 FR 53042 on September 8, 2006, is
adopted as a final rule with the following changes:
0
1. The authority citation for 48 CFR parts 202, 210, 213, 215, and 219
continues to read as follows:
Authority: 41 U.S.C. 421 and 48 CFR Chapter 1.
PART 213--SIMPLIFIED ACQUISITION PROCEDURES
0
2. Section 213.106-1-70 is revised to read as follows:
213.106-1-70 Soliciting competition--tiered evaluation of offers.
See limitations on the use of tiered evaluation of offers at
215.203-70.
PART 215--CONTRACTING BY NEGOTIATION
0
3. Section 215.203-70 is amended by revising paragraph (c) introductory
text, paragraph (c)(1) introductory text, and paragraph (c)(2) to read
as follows:
215.203-70 Requests for proposals--tiered evaluation of offers.
* * * * *
(c) The contracting officer is prohibited from issuing a
solicitation with a tiered evaluation of offers unless--
(1) The contracting officer conducts market research, in accordance
with
[[Page 42315]]
FAR Part 10 and Part 210, to determine--
* * * * *
(2) If the contracting officer cannot determine whether the
criteria in paragraph (c)(1) of this section are met, the contracting
officer includes a written explanation in the contract file as to why
such a determination could not be made (Section 816 of Public Law 109-
163).
[FR Doc. E7-14906 Filed 8-1-07; 8:45 am]
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