[Federal Register: December 22, 2004 (Volume 69, Number 245)]
[Proposed Rules]
[Page 76660-76664]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr22de04-19]
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DEPARTMENT OF STATE
48 CFR Parts 619, 625, 628, and 652
[Public Notice 4938]
RIN 1400-AB90
Department of State Acquisition Regulation
AGENCY: State Department.
ACTION: Proposed rule.
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SUMMARY: This proposed rule makes three changes to the DOSAR. It
revises the DOSAR to: Formalize Department policy regarding the
application of the Small Business Act to contracts awarded by domestic
contracting activities where contract performance takes place overseas;
add language to deal with U.S. Government support to contractors
performing overseas; and, revise the coverage regarding Defense Base
Act insurance.
DATES: The Department will accept comments from the public up to 60
days from December 22, 2004.
ADDRESSES: You may submit comments, identified by any of the following
methods:
E-mail: ginesgg@state.gov. You must include the RIN in the
subject line of your message.
Mail (paper, disk, or CD-ROM submissions): Gladys Gines,
Procurement Analyst, Department of State, Office of the Procurement
Executive, 2201 C Street, NW., Suite 603, State Annex Number 6,
Washington, DC 20522-0602.
Fax: 703-875-6155.
Persons with access to the Internet may also view this notice and
provide comments by going to the regulations.gov Web site at: http://www.regulations.gov/index.cfm
.
FOR FURTHER INFORMATION CONTACT: Gladys Gines, Procurement Analyst,
Department of State, Office of the Procurement Executive, 2201 C
Street, NW., Suite 603, State Annex Number 6, Washington, DC 20522-
0602; e-mail address: ginesgg@state.gov.
SUPPLEMENTARY INFORMATION: As indicated in the Summary, the proposed
rule makes three changes to the DOSAR, as follows:
DOSAR 619.000 is added to formalize the Department's
policy regarding the application of the Small Business Act to contracts
awarded by domestic contracting activities (i.e., those located in the
United States) where contract performance takes place overseas.
Currently, FAR 19.000(b) states that part 19, with the exception of
subpart 19.6, applies ``only in the United States or its outlying
areas.'' This language is ambiguous and subject to interpretation.
While the application is clear with respect to contracts both awarded
and performed in the United States (it applies) and to contracts both
awarded and performed outside the United States (it does not apply),
the gray area is its applicability to contracts awarded by contracting
offices located in the United States but where contract performance
takes place overseas. The Department has subsequently followed an
informal policy of applying part 19 to such contracts. This DOSAR
change, therefore, states this policy in explicit terms.
A new DOSAR subpart 625.71 is added to address the issue
of the Department's administrative, logistical, and security support of
contractor personnel performing overseas in locations where a
contingency operation is ongoing or in high-risk locations.
Essentially, the policy requires that contractors furnish their own in-
country non-U.S. Government administrative, logistical, and security
support. If the Department authorizes the use of U.S. Government-
provided support, that support shall be set forth in the Statement of
Work. An associated contract clause is added at 652.225-72. The clause
is mandatory in Department contracts when the contract is in support of
the operations/missions at one or more U.S. diplomatic or consular
missions, and the location of the U.S. diplomatic or consular mission
at which the work is to be performed is designated as a contingency
operation, as defined in FAR 2.101. The clause is optional for use in
contracts in support of the operations/missions at one or more U.S.
diplomatic or consular missions in situations where a military
contingency operation does not exist, but a high risk to personnel or
property is known or anticipated.
Subpart 628.3 is revised to clarify the application of
Defense Base Act (DBA) insurance to local and third country nationals.
The Department of
[[Page 76661]]
Labor (DOL) has granted the Department of State (DOS) waivers to cover
local and third country nationals. These waivers state that DOS
contractors need not provide DBA insurance for those DOS contractor
employees who are local or third country nationals. However, the DOL
waivers state that in lieu of DBA insurance, the DOS contractors must
provide workers' compensation benefits to local and third country
nationals in accordance with local law. The Department of State did not
interpret the waivers as a DOL requirement for DOS contractors to
provide DBA insurance to local or third country national contractor
employees in countries where no workers' compensation law existed.
Nevertheless, DOL recently stated that the absence of local workers'
compensation laws in certain countries renders the DOL waivers
``ineffective'', and that where there is no local workers''
compensation law, DOS contractors must provide local and third country
national employees with the DBA insurance. As a result, the Department
is revising Subpart 628.3 to clarify this issue. In addition, the
revision includes language regarding a statutory exemption from the DBA
for contractor employees who perform work on an intermittent basis for
not more than 90 days in a calendar year. This exemption is stated in
Section 16 of the State Department Basic Authorities Act (22 U.S.C.
2680a), as amended. The DOSAR clause at 652.228-71 is revised
accordingly. In addition, a new solicitation provision is added at
652.228-70. The purpose of the provision is to request information from
prospective contractors on whether or not any covered contractor
employees will be employed on the resultant contract. Finally, in
looking at appropriate revisions to the DOSAR provisions at 652.228-74
and 652.228-76, it was determined that one provision to cover all types
of contracts could be used. DOSAR 652.228-76 is therefore removed and
652.228-74 is revised to cover all contract types as opposed to just
fixed-price.
Regulatory Findings
Administrative Procedure Act
In accordance with provisions of the Administrative Procedure Act
governing rules promulgated by federal agencies that affect the public
(5 U.S.C. 552), the Department is publishing this proposed rule and
inviting public comment.
Regulatory Flexibility Act
The Department of State, in accordance with the Regulatory
Flexibility Act (5 U.S.C. 605(b)), has reviewed this regulation and, by
approving it, certifies that this rule will not have a significant
economic impact on a substantial number of small entities.
Unfunded Mandates Act of 1995
This rule will not result in the expenditure by State, local, and
tribal governments, in the aggregate, or by the private sector, of $100
million or more in any year and it will not significantly or uniquely
affect small governments. Therefore, no actions were deemed necessary
under the provisions of the Unfunded Mandates Reform Act of 1995.
Small Business Regulatory Enforcement Fairness Act of 1996
This rule is not a major rule as defined by section 804 of the
Small Business Regulatory Enforcement Act of 1996. This rule will not
result in an annual effect on the economy of $100 million or more; a
major increase in costs or prices; or significant adverse effects on
competition, employment, investment, productivity, innovation, or on
the ability of United States-based companies to compete with foreign
based companies in domestic and import markets.
Executive Order 13132
This regulation will not have substantial direct effects on the
States, on the relationship between the national government and the
States, or on the distribution of power and responsibilities among the
various levels of government. Therefore, in accordance with section 6
of Executive Order 13132, it is determined that this rule does not have
sufficient federalism implications to require consultations or warrant
the preparation of a federalism summary impact statement.
Paperwork Reduction Act
Information collection requirements have been approved under the
Paperwork Reduction Act of 1980 by OMB, and have been assigned OMB
control number 1405-0050.
List of Subjects in 48 CFR Parts 619, 625, 628, 652
Government procurement.
Accordingly, for the reasons set forth in the preamble, title 48,
chapter 6 of the Code of Federal Regulations is proposed to be amended
as follows:
1. The authority citation for 48 CFR parts 619, 625, 628, and 652
continues to read as follows:
Authority: 40 U.S.C. 486(c); 22 U.S.C. 2658.
Subchapter D--Socioeconomic Programs
PART 619--SMALL BUSINESS PROGRAMS
2. A new section 619.000 is added to read as follows:
619.000 Scope of part.
(b) Notwithstanding FAR 19.000(b), it is the Department's policy to
provide maximum opportunities for U.S. small businesses in all
legislatively specified categories to participate in the acquisition
process. Therefore, DOS contracts that are awarded domestically for
performance overseas shall be subject to the Small Business Act as a
matter of policy. Contracts awarded overseas should comply on a
voluntary basis, where practicable.
PART 625--FOREIGN ACQUISITION
3. A new Subpart 625.71, consisting of sections 625.7101, 625.7101-
1, and 625.7101-2, is added to read as follows:
Subpart 625.71--Contractor Personnel Performing Under Department of
State Contracts Outside the United States
Sec.
625.7101 Government administrative, logistical, and security support
of contractor personnel.
625.7101-1 Policy.
625.7101-2 Contract clause.
Subpart 625.71--Contractor Personnel Performing Under Department of
State Contracts Outside the United States
625.7101 Government administrative, logistical, and security support
of contractor personnel.
625.7101-1 Policy.
(a) This subpart does not apply to personal services contracts with
individuals.
(b) Contractors shall provide their own in-country administrative,
logistical, and security support for their personnel who are performing
work at a diplomatic or consular mission outside the United States,
unless otherwise specified in the contract (see paragraph (c) of this
section). For the purposes of this subpart, ``at a diplomatic or
consular mission'' is defined as any location under the span of
influence of a specific diplomatic or consular mission.
(c) If the Government authorizes the use of Government-provided
support, the Government shall set forth the exact support to be
authorized in the Statement of Work.
(d) Contracting officers shall document the contract file with the
basis for the decision to provide support.
[[Page 76662]]
625.7101-2 Contract clause.
(a) The contracting officer shall insert the clause at 652.625-72,
Contractor Personnel Performing Under Department of State Contracts
Outside the United States, in solicitations and contracts for services
or construction, when the following conditions are met:
(1) The contract is in support of the operations/missions at one or
more United States diplomatic or consular missions; and
(2) The location of the United States diplomatic or consular
mission at which the work is to be performed is designated as a
contingency operation, as defined in FAR 2.101.
(b) The contracting officer may insert the clause at 652.625-72 in
contracts in support of the operations/missions at one or more United
States diplomatic or consular missions in situations where a military
contingency operation does not exist but a high risk to personnel or
property is known or anticipated.
Subchapter E--General Contracting Requirements
PART 628--BONDS AND INSURANCE
4. Subpart 628.3 is revised to read as follows:
Subpart 628.3--Insurance
628.305 Overseas workers' compensation and war-hazard insurance.
(b)(1) It is the Department's policy that acquisitions for
services, including construction but excluding personal services
contracts, that require contractor personnel to perform work outside of
the United States, shall include the contractual obligation for
coverage under the Defense Base Act (42 U.S.C. 1651-1654, as amended),
for covered contractor employees. For the purposes of this section,
``covered contractor employees'' includes the following individuals:
(i) United States citizens or residents;
(ii) Individuals hired in the United States or its possessions,
regardless of citizenship; and
(iii) Local nationals and third country nationals where contract
performance takes place in a country where there are no local workers'
compensation laws.
(2) Exceptions are discussed in paragraphs (e)(1) and (f) of this
section.
(c) The Department of State has entered into a contract with an
insurance broker and carrier to provide Defense Base Act insurance, at
a fixed rate for services and construction, to cover DOS contracts that
require performance overseas by covered contractor employees. Upon
award of a contract that requires Defense Base Act insurance, the
contracting officer shall notify the contractor of the name of the
insurance broker from which the contractor must acquire the Defense
Base Act insurance.
(d) The authority to request a waiver from the Secretary of Labor
of a particular country, as set forth in FAR 28.305(d), is reserved to
the Secretary of State.
(e)(1) The Secretary of Labor has waived the applicability of the
Defense Base Act for all DOS service contracts, including construction,
for contractor employees who are local nationals or third country
nationals. This waiver is conditioned on the requirement for the
contractor to provide workers' compensation benefits against the risk
of work injury or death and assume liability toward the employees and
their beneficiaries for war-hazard injury, death, capture, or detention
as prescribed by the applicable local laws.
(2) If contract performance takes place in a country where there
are no local workers' compensation laws, any local and third country
national contractor employees are considered to be ``covered contractor
employees'', and the contractor shall acquire Defense Base Act
insurance for those employees pursuant to the contract between the
Department of State and the Defense Base Act insurance broker.
(f) Section 16 of the State Department Basic Authorities Act (22
U.S.C. 2680a), as amended, provides that the Defense Base Act shall not
apply with respect to such contracts as the Secretary of State
determines are contracts with persons employed to perform work for the
Department of State on an intermittent basis for not more than 90 days
in a calendar year. The Department of State has established that
``persons'' includes individuals hired by companies under contract with
the Department. The Procurement Executive has the authority to issue
the waivers for these individuals. However, as required by FAR
28.305(e), the contractor shall provide workers' compensation coverage
against the risk of work injury or death and assume liability toward
the employees and their beneficiaries for war-hazard injury, death,
capture, or detention.
628.309 Contract clauses for workers' compensation insurance.
628.309-70 DOSAR provisions and clause.
(a) The contracting officer shall insert the provision at 652.228-
70, Defense Base Act--Covered Contractor Employees, in all
solicitations for services and construction to be performed outside of
the United States.
(b) The contracting officer shall insert the clause at 652.228-71,
Workers' Compensation Insurance (Defense Base Act)--Services, in
solicitations and contracts for services to be performed outside of the
United States when there is a reasonable expectation that offers will
include covered contractor employees, as defined in 628.305(b)(1). If
the contracting officer is unsure as to whether offers will include
covered contractor employees, the contracting officer shall insert the
clause. If the contract is for construction, the contracting officer
shall insert the clause with its Alternate I.
(c) The contracting officer shall insert the provision at 652.228-
74, Defense Base Act Insurance Rates--Limitation, in solicitations for
services or construction to be performed outside of the United States
when there is a reasonable expectation that offers will include covered
contractor employees, as defined in 628.305(b)(1). If the contracting
officer is unsure as to whether offers will include covered contractor
employees, the contracting officer shall insert the provision.
Subchapter H--Clauses and Provisions
PART 652--SOLICITATION PROVISIONS AND CONTRACT CLAUSES
5. Section 652.225-72 is added to read as follows:
652.225-72 Contractor Personnel Performing Under Department of State
Contracts Outside the United States.
As prescribed in 625.7101-2, insert the following clause:
Contractor Personnel Performing Under Department of State
Contracts Outside the United States (MO/YR)
(a) Definition. For the purposes of this clause, ``at a
diplomatic or consular mission'' is defined as any location under
the span of influence of a specific diplomatic or consular mission.
(b) General. Performance of this contract may require that
contractor personnel work at locations outside the United States in
support of one or more United States diplomatic or consular
missions. Contract performance in support of such missions may be
inherently dangerous.
(c) Support. (1) Unless specified elsewhere in the contract or
as provided in paragraph (c)(2) of this clause, the Contractor is
responsible for all administrative, logistical, and security support
required for contractor personnel engaged in this contract.
(2) The Government may authorize or may require the use of
certain Government-provided administrative, logistical, security, or
in-country support.
(d) Personnel data. If requested by the contracting officer, the
Contractor shall maintain and provide to the designated Government
official(s) a current list of all
[[Page 76663]]
employees in the area of performance. The contracting officer shall
indicate if this list must also contain each employee's next-of-kin
notification information. The contracting officer shall designate
the Government official to receive this data and the method for
submission.
(e) Pre-performance requirements. The Contractor shall ensure
that the following requirements are met before sending an employee
to the work site. Specific requirements for each category will be
set forth in the Statement of Work. The Contractor shall ensure
that--
(1) All applicable specified security and background checks are
completed;
(2) All personnel are medically and physically fit to endure the
rigors of performance and have received all required vaccinations;
(3) All personnel possess the required licenses to operate all
vehicles or equipment necessary to perform the contract, if required
by the position;
(4) All personnel have all necessary passports, visas, entry
permits, and other documents required for contractor personnel to
enter and exit the foreign country, including those required for in-
transit countries;
(5) All personnel have received a country clearance, if required
by the Chief of Mission;
(6) All personnel have received personal security training. The
training must at a minimum cover safety and security issues facing
employees overseas; identify safety and security contingency
planning activities; and identify ways to utilize safety and
security personnel and other resources appropriately; and,
(7) All personnel who are U.S. citizens are registered with the
U.S. Embassy or Consulate with jurisdiction over the area of
operations. Personnel shall register on-line at http://www.travel.state.gov
.
(f) Processing and departure points. The Contractor and its
employees shall use a point of departure and transportation mode
when directed by the contracting officer.
(g) Military clothing and protective equipment. Contractor
personnel are prohibited from wearing military clothing unless
specifically authorized by the contracting officer. However,
contractor personnel may wear specific items required for safety and
security such as ballistic, nuclear, biological, or chemical
protective clothing.
(h) Weapons. (1) Contractor personnel may not possess privately
owned firearms unless specifically authorized by the contracting
officer.
(2) If the contracting officer authorizes the carrying of
firearms in accordance with the Statement of Work, the Regional
Security Officer may issue weapons and ammunition to the Contractor
for issuance to specified contractor employees. The Contractor shall
ensure that its personnel who receive weapons are adequately
trained, are not barred from possession of a firearm by 18 U.S.C.
922(d)(9) or (g)(9), and adhere to all guidance and orders issued by
the Regional Security Officer regarding possession, use, safety, and
accountability of weapons and ammunition. Upon a revocation by the
contracting officer of a contractor's authorization to issue
firearms, the Contractor shall ensure that all Government-issued
weapons and unexpended ammunition are returned as directed by the
contracting officer. Whether or not weapons are Government-issued,
all liability for the use of any weapon by contractor personnel
rests solely with the Contractor.
(i) Next of kin notification. The Contractor shall be
responsible for in-person notification of the employee-designated
next of kin and notification as soon as possible to the U.S. consul
responsible for the area in which the event occurred in the
following circumstances:
(1) Death of the employee;
(2) An injury to the employee requiring evacuation;
(3) The employee is missing, i.e., the employee's location is
unknown after a reasonable amount of time and search efforts are
unsuccessful; or,
(4) The employee is captured.
(j) Return of remains. In the event of the death of a contractor
employee, the Contractor is responsible for the return of the
remains from the point of identification to the location specified
by the employee or next of kin, as applicable. The Contractor shall
also be responsible for the return of all personal effects of
deceased or missing contractor personnel, if appropriate, to next of
kin.
(k) Evacuation. If the Chief of Mission orders a mandatory
evacuation of some or all personnel, the level of assistance
provided to employees of the Contractor shall be the same as the
level of assistance provided to other private United States
citizens. In the event of a non-mandatory evacuation order, the
Contractor shall maintain personnel on location sufficient to meet
contractual obligations under this contract until instructed to
evacuate by the contracting officer, Contracting Officer's
Representative, or Chief of Mission.
(l) Changes in emergencies. The contracting officer or the
Contracting Officer's Representative may issue oral instructions to
the Contractor in cases of emergencies, e.g., enemy or terrorist
activity or natural disaster that causes an immediate possibility of
death or serious injury to contractor personnel. Such oral
instructions shall be confirmed in writing in 48 hours, or as soon
as practicable after the emergency incident has subsided.
(m) Subcontracts. The Contractor shall incorporate the substance
of this clause, including this paragraph (m), in all subcontracts
that require subcontractor employees to provide services at a United
States diplomatic or consular mission outside the United States.
(End of clause)
6. Section 652.228-70 is added to read as follows:
652.228-70 Defense Base Act--Covered Contractor Employees.
As prescribed in 628.309-70(a), insert the following provision:
Defense Base Act--Covered Contractor Employees (MO/YR)
(a) Bidders/Offerors shall indicate below whether or not any of
the following categories of employees will be employed on the
resultant contract, and, if so, the number of such employees:
----------------------------------------------------------------------------------------------------------------
Category Yes/No Number
----------------------------------------------------------------------------------------------------------------
(1) United States citizens or
residents
(2) Individuals hired in the United
States, regardless of citizenship
(3) Local nationals or third ....................... Local nationals: ------------.
country nationals where contract Third Country Nationals: ------------.
performance takes place in a
country where there are no local
workers' compensation laws.
(4) Local nationals or third ....................... Local nationals: ------------.
country nationals where contract Third Country Nationals: ------------.
performance takes place in a
country where there are local
workers' compensation laws.
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(b) If the bidder/offeror has indicated ``yes'' in block (a)(4)
of this provision, the bidder/offeror shall submit, as part of its
offer, a statement that indicates that such local nationals and/or
third country nationals will be provided workers' compensation
coverage against the risk of work injury or death under a local
workers' compensation law. For those employees, the bidder/offeror
shall also assume liability toward the employees and their
beneficiaries for war-hazard injury, death, capture, or detention,
in accordance with the clause at FAR 52.228-4.
(c) If the bidder/offeror has indicated ``yes'' in blocks
(a)(1), (2), or (3) of this provision, the bidder/offeror shall
compute Defense Base Act insurance costs covering those employees
pursuant to the terms of the contract between the Department of
State and the Department's Defense Base Act insurance carrier at the
rates specified in DOSAR 652.228-74, Defense Base Act Insurance
Rates `` Limitation. If DOSAR provision 652.228-74 is not included
in this solicitation, the bidder/offeror shall notify the
contracting officer before the closing date so that the solicitation
can be amended accordingly.
(End of provision)
7. Section 652.228-71 is revised to read as follows:
[[Page 76664]]
652.228-71 Workers' Compensation Insurance (Defense Base Act)--
Services.
As prescribed in 628.309-70(b), insert the following clause:
Workers' Compensation Insurance (Defense Base Act)--Services
(MO/YR)
(a) This clause supplements FAR 52.228-3. For the purposes of
this clause, ``covered contractor employees'' includes the following
individuals:
(1) United States citizens or residents;
(2) Individuals hired in the United States or its possessions,
regardless of citizenship; and
(3) Local nationals and third country nationals where contract
performance takes place in a country where there are no local
workers' compensation laws.
(b) The Contractor shall procure Defense Base Act (DBA)
insurance pursuant to the terms of the contract between the
Department of State and the Department's DBA insurance carrier for
covered contractor employees, unless the Contractor has a DBA self-
insurance program approved by the Department of Labor. The
Contractor shall submit a copy of the Department of Labor's approval
to the contracting officer upon contract award, if applicable.
(c) The current rate under the Department of State contract is
[contracting officer insert rate] of compensation for services.
(d) The Contractor shall insert a clause substantially the same
as this in all subcontracts. The Contractor shall require that
subcontractors insert a similar clause in any of their subcontracts.
(e) Should the rates for DBA insurance coverage increase or
decrease during the performance of this contract, the contracting
officer shall modify this contract accordingly.
(f) The Contractor shall demonstrate to the satisfaction of the
contracting officer that the equitable adjustment as a result of the
insurance increase or decrease does not include any reserve for such
insurance. Adjustment shall not include any overhead, profit,
general and administrative expenses, etc.
(g) Section 16 of the State Department Basic Authorities Act (22
U.S.C. 2680a), as amended, provides that the Defense Base Act shall
not apply with respect to such contracts as the Secretary of States
determines are contracts with persons employed to perform work for
the Department of State on an intermittent basis for not more than
90 days in a calendar year. ``Persons'' includes individuals hired
by companies under contract with the Department. The Procurement
Executive has the authority to issue the waivers for these
Contractor employees. For those employees, the Contractor shall
provide workers' compensation coverage against the risk of work
injury or death and assume liability toward the employees and their
beneficiaries for war-hazard injury, death, capture, or detention.
(End of clause)
Alternate I. (MO/YR) If the contract is for construction, as
prescribed in 628.309-70(a), substitute the following paragraph (c)
for paragraph (c) of the basic clause:
(c) The current rate under the Department of State contract is
[contracting officer insert rate] of compensation for construction.
8. Section 652.228-74 is revised to read as follows:
652.228-74 Defense Base Act Insurance Rates--Limitation.
As prescribed in 628.309-70(c), insert the following provision:
Defense Base Act Insurance Rates--Limitation (MO/YR)
(a) The Department of State has entered into a contract with an
insurance carrier to provide Defense Base Act (DBA) insurance to
Department of State covered contractor employees at a contracted
rate. For the purposes of this provision, ``covered contractor
employees'' includes the following individuals:
(1) United States citizens or residents;
(2) Individuals hired in the United States or its possessions,
regardless of citizenship; and
(3) Local nationals and third country nationals where contract
performance takes place in a country where there are no local
workers' compensation laws.
(b) In preparing the cost proposal, the bidder/offeror shall use
the following rates in computing the cost for DBA insurance:
compensation; or
compensation.
(c) Bidders/offerors shall compute the total compensation
(direct salary plus differential, but excluding per diem, housing
allowance and other miscellaneous allowances) to be paid to covered
contractor employees and the cost of the DBA insurance in their bid/
offer using the foregoing rate. The DBA insurance cost shall be
included in the total fixed price or estimated cost. The Department
shall reimburse the DBA insurance costs directly to the Contractor.
(End of provision)
9. Section 652.228-76 is removed.
Corey M. Rindner,
Procurement Executive, Bureau of Administration, Department of State.
[FR Doc. 04-27990 Filed 12-21-04; 8:45 am]
BILLING CODE 4710-24-P