VA Acquisition Regulation: Acquisition of Commercial Items and Simplified Acquisition Procedures
| Published date | 25 March 2020 |
| Citation | 85 FR 16900 |
| Record Number | 2020-05589 |
| Section | Rules and Regulations |
| Court | Veterans Affairs Department |
Federal Register, Volume 85 Issue 58 (Wednesday, March 25, 2020)
[Federal Register Volume 85, Number 58 (Wednesday, March 25, 2020)]
[Rules and Regulations]
[Pages 16900-16907]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-05589]
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DEPARTMENT OF VETERANS AFFAIRS
48 CFR Parts 812, 813, 852, and 853
RIN 2900-AP58
VA Acquisition Regulation: Acquisition of Commercial Items and
Simplified Acquisition Procedures
AGENCY: Department of Veterans Affairs.
ACTION: Final rule.
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SUMMARY: The Department of Veterans Affairs (VA) is amending and
updating its VA Acquisition Regulation (VAAR) in phased increments to
revise or remove any policy superseded by changes in the Federal
Acquisition
[[Page 16901]]
Regulation (FAR), to remove procedural guidance internal to VA into the
VA Acquisition Manual (VAAM), and to incorporate any new agency
specific regulations or policies. These changes seek to streamline and
align the VAAR with the FAR and remove outdated and duplicative
requirements and reduce burden on contractors. The VAAM incorporates
portions of the removed VAAR as well as other internal agency
acquisition policy. VA will rewrite certain parts of the VAAR and VAAM,
and as VAAR parts are rewritten, VA will publish them in the Federal
Register. In particular, this rulemaking revises the VAAR concerning
Acquisition of Commercial Items and Simplified Acquisition Procedures,
and affected parts Solicitation Provisions and Contract Clauses, and
Forms.
DATES: This rule is effective on April 24, 2020.
FOR FURTHER INFORMATION CONTACT: Mr. Rafael N. Taylor, Senior
Procurement Analyst, Procurement Policy and Warrant Management
Services, 003A2A, 425 I Street NW, Washington, DC 20001, (202) 382-
2787. (This is not a toll-free number.)
SUPPLEMENTARY INFORMATION: On January 11, 2018, VA published a proposed
rule in the Federal Register (83 FR 1321) which announced VA's intent
to amend regulations for VAAR Case RIN 2900-AP58 (parts 812 and 813).
VA provided a 60-day comment period for the public to respond to the
proposed rule and submit comments. The comment period for the proposed
rule ended on March 12, 2018 and VA received comments from a total of
five respondents. This rule adopts as a final rule, with changes, the
proposed rule published in the Federal Register on January 11, 2018.
This final rule adds language to VAAR part 812 to state that VA's
Veterans First Contracting Program (VFCP) under VAAR subpart 819.70
applies to VAAR part 812, Acquisition of Commercial Items; to update a
list of unique VA solicitation provisions and contract clauses that
contracting officers can apply to solicitations and contracts for the
acquisition of commercial items; and to add a new clause on Gray Market
Items to ensure that new medical equipment and associated services and
support for VA Medical Centers are purchased from Original Equipment
Manufacturers (OEM) or their authorized distributors and resellers. In
VAAR part 813, this final rule adds language to reference the
applicability of the VFCP in contracts awarded using Simplified
Acquisition Procedures; to require contracting officers to use the
Vendor Information Pages (VIP) database to confirm Service-Disabled
Veteran-Owned Small Business (SDVOSB) and Veteran-Owned Small Business
(VOSB) status; and to add language in VAAR part 813 that emphasizes
that contracting officers can use other than competitive procedures
under specified circumstances when awarding to SDVOSBs and VOSBs. VA
had proposed removing the language at 813.202, Purchase guidelines, and
to replace it with proposed text at 813.203, Purchase guidelines, to
comport with the numbering and arrangement of the FAR. VA is removing
the current text contained in 813.202 as described in the Technical
Non-Substantive Changes to the Proposed Rule section.
This final rule includes changes as a result of public comments,
minor formatting and/or grammatical edits, as well as Federal Register
administrative format changes in the amendatory text which result in no
substantive changes at the affected sections.
There were five respondents that submitted public comments. There
were 15 separate comments submitted by these 6 respondents. Because
there was redundancy in terms of the comments submitted, VA has
separated the comments and responses into 9 distinct issues and themes
for clarity. A discussion of the issues raised in the comments as well
as the changes made to the rule as a result of those comments are
provided as follows:
1. Positive Feedback on the Proposed Rule
A respondent commends VA for its thoughtful development of this
rule and of the agency's overarching goal of revising and streamlining
the VAAR. They believe that SDVOSBs and VOSBs, as well as VA
contracting officers, will benefit from the clarity this rulemaking
provides regarding the applicability of the Veterans First Contracting
Program policy and VAAR provisions to VA acquisition of commercial
items. They also commend VA for removing some unnecessary or
duplicative provisions and for adding a VAAR provision to make clear
when ``gray market'' items are not permitted.
VA appreciates the feedback from these commenters on the VA's
overarching goal to streamline the VAAR. VA is also pleased the
commenters support overall the revisions to VAAR parts 812 and 813.
2. Clarification of the VA Acquisition of Commercial Items Clauses
One commenter raised the issue that the proposed provision,
852.212-70, Provisions Applicable to VA Acquisition of Commercial
Items, and the clause, 852.212-71, Contract Terms and Conditions
Applicable to VA Acquisition of Commercial Items, may be confusing and
proposes that VA consider combining them into one list for clarity and
consistency.
VA has reexamined the proposed clause and provision, and agrees
that combining the previously proposed separate clause and provision
into one clause will eliminate unnecessary duplication when it must be
included in both solicitations and in contracts, BPAs and orders.
Accordingly, section 812.301 has been amended to reflect the updated
prescription, numbering and title for the new combined clause, 852.212-
70, Provisions and Clauses Applicable to VA Acquisition of Commercial
Items, and the renumbered remaining clause originally prescribed in
this section, now 852.212-71, Gray Market Items. VA has also updated
the list of unique VA solicitation provisions and contract clauses that
contracting officers can apply to solicitations and contracts for the
acquisition of commercial items based on current prescribed provisions
or clauses and current VA practice.
3. Concerns About Gray Market Items, Pass-Through Entities and High
Tech Medical Equipment
A commenter expressed concern with business entities which do not
possess the clinical and technical knowledge of high tech medical
equipment and supporting ancillary services and acting as a ``pass-
through'' entity. The commenter expresses concern that such ``pass-
through'' entities will have a negative effect on the delivery of
quality patient care and services to VA Medical Centers if such
business entities are allowed to participate in VA procurements. The
commenter believes that new medical equipment for VA Medical Centers
should be purchased from an OEM or its authorized dealer, distributor,
or reseller. The commenter also expressed concern that allowing set-
asides for firms that are not manufacturers (i.e., nonmanufacturers)
may create potential pass-throughs.
VA is always concerned with the fidelity and quality of equipment
purchased to support Veterans healthcare. VA believes the inclusion of
clause 852.212-71, Gray Market Items, will appropriately address the
use of authorized Original Equipment Manufacturer (OEM) distributors or
resellers. Policy governing the SBA nonmanufacturer rule and
limitations on subcontracting requirements are covered in the FAR and
other parts of the VAAR and permit the use of
[[Page 16902]]
businesses that comply with those regulations. We are making no changes
to this rule based on this comment.
4. Potential Conflicts Between the Proposed Rule, VA's Veterans Small
Business Regulations at 38 CFR Part 74 and the SBA's Regulations on
Government Contracting Programs at 13 CFR Part 125
One commenter provided comments in response to both the proposed
rule under this case, and proposed changes to VA's Veterans Small
Business Regulations at 38 CFR part 74, published January 10, 2018 in
the Federal Register (83 FR 1203). The commenter states that ``a
Veteran-Owned Small Business (VOSB)/Service-Disabled Veteran-Owned
Small Business (SDVOSB) must be verified by the VA's Center for
Verification and Evaluation (CVE) and listed in the Vendor Information
Pages (VIP) database in order to be eligible for set-aside contract
awards in the VA. This eligibility continues for 3 years unless there
are circumstances which require the business to exit the program as
outlined in 38 CFR 74.21. One of those circumstances is failure to
maintain its eligibility for program participation. Presumably, when a
VOSB/SDVOSB finds that it is no longer small for a particular NAICS
code for which it is registered, it is also no longer eligible to be
listed in VIP for that NAICS code and will be removed. This appears to
be in conflict with the Small Business Administration (SBA) policy.''
VA will not revise VAAR part 812 or 813 based on this comment.
Title 38 U.S.C. 8127 requires a firm must be listed as verified in the
VA database to be eligible to receive an award under the VFCP. This
comment is beyond the scope of this rule as it mostly applies to
certification and verification requirements under the VA's Veterans
Small Business Regulations at 38 CFR part 74, published January 10,
2018 in the Federal Register (83 FR 1203) and which became effective
October 1, 2018 (83 FR 48221). Note that a new SBA regulation related
to SDVOSB certification also became effective on the same date. The
changes in both SBA and VA regulations comply with the directive in the
National Defense Authorization Act of 2017 (Pub. L. 114-328), section
1832, to standardize definitions for SDVOSBs and VOSBs between VA and
SBA. As required by section 1832, the Secretary of Veterans Affairs
will use SBA's regulations to determine ownership and control of
SDVOSBs and VOSBs. The Secretary would continue to determine whether
individuals are Veterans or service-disabled Veterans and would be
responsible for verification of applicant firms. Challenges to the
status of an SDVOSB or VOSB based upon issues of ownership or control
would be decided by the administrative judges at the SBA's Office of
Hearings and Appeals (OHA).
The commenter also provided comments indicating that SDVOSB/VOSB
verification and representation requirements should not apply to
orders. The commenter argued that requiring the verification of SDVOSB/
VOSB status at the order level would be in conflict with the SBA
regulations which do not require verification at the task order level
for certain types of contracts. The commenter believes that the
proposed VAAR conflicts with that SBA policy. In effect, the commenter
submits, that while the SBA rules may allow an SDVOSB that has
``organically outgrown'' its size to compete for orders under an IDIQ
for up to 5 years without recertifying its status or size (unless the
[contracting officer] CO requests it), VA's Veterans First Contracting
Program requires ``recertification'' within 30 days of a business
outgrowing its size by removing it from the VIP database (which must be
checked by the CO prior to task order award). Furthermore, the
commenter believes that ``it may be argued that the VA rule is
tantamount to eliminating the CO's discretion to ask for
recertification at the task order level by requiring the CO to,
effectively, ask for a recertification for every task order by checking
VIP''. Another commenter argued the opposite. The second commenter
believes that VA should revise VAAR 813.003-70 to make clear that the
Veterans First Contracting Program mandate and the requirement to
confirm SDVOSB or VOSB status apply to task orders. However, they
recommend VA follow the SBA guidance on small business representation.
They also believe that replacing ``prior to award'' with ``at the time
of award'' would provide more clarity on the specific point of time at
which VA judges SDVOSB and VOSB eligibility.
We are unable to make the overall recommended changes due to VA's
statutory mandate. The Veterans First Contracting Program (VFCP)
applies to all contracts, BPAs and orders under this part. VA
legislation is very clear that only small businesses listed in the VA
database of eligible firms (the Vendor Information Pages or VIP) can be
awarded a contract under the VFCP. The Supreme Court confirmed this
requirement and issued a decision in 2016 that for purposes of the
program, an order is a contract. Therefore, verifying VIP eligibility
shall occur both at the time of submission of offers and prior to award
for contracts and orders is consistent with the current VAAR 819.7003
class deviation issued on July 25, 2016. A future VAAR case for part
819 will further examine the issue of ``prior to award'' or ``at time
of award.''
5. Use of the Veterans First Contracting Program (38 U.S.C. 8127-8128)
as an Authority for the Proposed Rule
One of the commenters objected to the use of 38 U.S.C. 8127-8128 as
an authority citation in parts 812 and 813. The commenter requested an
explanation to why this specific statute is included in a document that
explicitly excludes internal guidance on processes and procedures. The
commenter believes it is inappropriate to include the statute by
reference at a time when many questions regarding guidance,
applicability, and impact are unanswered.
We are making no change to VAAR part 812 or 813 based on this
comment. The inclusion of the authority is appropriate because many of
the issues addressed in these parts are based on the unique and special
requirements imposed by legislation and statute and make it necessary
to include the referenced citation.
6. Applicability of the Veterans First Contracting Program in the
Proposed Rule
A commenter indicated that the proposed policy at VAAR 813.003-70
references contracts as defined in FAR 2.101, but does not explicitly
reference task orders. To avoid confusion, the commenter recommends
that VA revise VAAR 813.003-70(a) to include a reference to orders.
VA notes that orders are part of the definition of contracts as set
forth in FAR 2.101, Definitions. However, to ensure clarity to the
specific types of actions covered under VAAR part 813, we are revising
813.003-70, Policy, to indicate that the VFCP applies to contracts,
orders and BPAs under this part. We also added a reference to FAR part
13 to indicate that the VFCP takes precedence over the small business
programs referenced in FAR part 13, and references to 819 which
includes additional information regarding compliance with the VFCP.
One commenter requested that VA include the use of a fixed
percentage figure to define ``fair and reasonable'' in the context of
the VA Rule of Two. They also believe that the nonmanufacturer rule
should be waived to allow Veteran small businesses the ability to
compete.
[[Page 16903]]
We are making no change to VAAR part 812 or 813 based on this
comment. How to conduct a price analysis and establishing a fair and
reasonable price is already addressed in the FAR. Specifically, FAR
subpart 15.4, Contract Pricing, provides guidance to contracting
officers to assist in making a fair and reasonable determination.
Additional internal agency guidance would be contained in the VA
Acquisition Manual. However, VA acknowledges this is an area of
interest for the public as well as VA's acquisition workforce. VA is
preparing additional internal training for its acquisition workforce to
strengthen and refresh contracting officer's skillsets in this area.
Regarding the nonmanufacturer rule and Veteran small businesses, VA
will continue to comply with SBA regulations. VA legislation requires
VA to use the small business definitions and requirements in the Small
Business Act, where not in conflict with VA's unique statutory
authority and 38 U.S.C. 8127-8128. This includes the application of the
nonmanufacturers rule. The nonmanufacturer rule is a requirement in the
Small Business Act as implemented by the SBA under 13 CFR 121.401
through 121.413 and applies to all Federal procurement programs for
which status as a small business is required or advantageous.
A commenter applauds VA for addressing the SDVOSB/VOSB sole source
option in its regulations. The commenter believes that the sole source
requirement in this section is consistent with the legislation, but
believes it is not consistent with those in VAAR subpart 819.70, as a
result of restrictions added to VAAR 819.7007 and 819.7008 through a
class deviation implementing the program as a result of the Kingdomware
Supreme Court Decision. The commenter believes that the legislation
does not impose requirements on when or how to use the sole source
authority and that VA should make clear that its contracting officers
need not do more than what is set forth in VAAR 813.106-70(c) to make
sole source awards to SDVOSBs and VOSBs above the simplified
acquisition threshold. The commenter requests that VA go so far as to
encourage the award of sole source contracts when certain conditions
are met. The commenter suggested revision language to VAAR 813.106-
70(c).
VA concurs that the VA legislation provides a unique sole source
authority that is less restrictive than a sole source award otherwise
permitted under FAR 6.302-1, ``Only one responsible source and no other
supplies or services will satisfy agency requirements.'' VA does not
concur, however, with the latter part of the commenter's analogy that a
sole source is acceptable under any circumstance or that the use of
sole source contracts should be encouraged. Consistent with the FAR, VA
encourages the use of competitive procedures for all its procurements
to the maximum extent practicable.
Therefore, VA declines to make changes to the language as suggested
but will add a FAR reference in VAAR 813.106-70(b) and (c) that
contracts awarded using the VA legislative authority shall be conducted
as authorized by FAR 6.302-5 and in accordance with 819.7007 and
819.7008, and to remove redundant language in the remaining paragraph
that is covered in the referenced sections and is also applicable under
part 813. This language is consistent with the legislative mandate, FAR
and the language in VAAR subpart 819.70, as provided in the July 25,
2016, VAAR Class Deviation--Implementation of the Veterans First
Contracting Program as a Result of the U.S. Supreme Court Decision
(Class Deviation--Veterans First Contracting Program (VFCP 2016).
One commenter stated that to make the statutory priority clear,
VAAR 813.003-70(c) should state that, under 38 U.S.C. 8127, contracts
shall be set aside for SDVOSBs when market research provides a
reasonable basis for receiving two or more offers from SDVOSBs. The
commenter believes the proposed VAAR 813.003-70, paragraph (c) does not
make the statutory priority clear, and paragraph (c)(1), as proposed,
says only that ``contracts under this part shall be set aside for
SDVOSBs or VOSBs, when supported by market research.''
The commenter also recommended VA revise VAAR 813.003-70(c)(2),
VAAR 852.212-70, and VAAR 852.212-71 to make clear the priorities for
SDVOSBs, and then VOSBs applies to all commercial items acquisitions
except for SDVOSB set-asides. The commenter stated in their opinion
that VA has appropriately recognized in VAAR 813.003-70(c)(2) that the
first priority is for SDVOSBs and second priority for VOSBs and applies
to procurements that are not set-aside for SDVOSBs or VOSBs. The
commenter believes that VAAR 813.003-70(c)(2) does not go far enough
because VAAR 852.215-70 should be inserted into any solicitation,
except those that are set-aside for SDVOSBs. The commenter further
asserts that requiring insertion of VAAR 852.215-70 into all
solicitations except for SDVOSB set-asides is the only way to ensure
that contracting officers develop an appropriate means (such as full/
partial credit) to implement the statutory mandate to prioritize award
of contracts to SDVOSBs first, then VOSBs second, before all other
small businesses, and finally large businesses.
The intent of the language at VAAR 813.003-70(c) is to highlight
the requirement that set-asides are mandatory and that if a set-aside
is not feasible, then evaluation preferences should be used in
accordance with 815.304-70. Any prescription changes to clauses
852.215-70 or -71 will be addressed in a separate VAAR case and is not
appropriate to make such changes to VAAR part 812 or 813 at this time.
While VA concurs that SDVOSBs have priority over VOSBs in every
instance, the evaluation preference prescribed in this section provides
recognition to the requirement in 38 U.S.C. 8128 that small business
concerns owned and controlled by veterans have a priority over other
small businesses. The priority of SDVOSBs over VOSBs is well
established, including at VAAR 813.003-70(c)(2). Therefore, the
language remains unchanged and any further clarification of the
language would be addressed in a future VAAR rulemaking case with VAAR
part 819.
Additionally, references to the VFCP program are included in the
section to set forth that the Veterans First Contracting Program
developed pursuant to the authority in 38 U.S.C. 8127-8128 applies to
both commercial acquisitions and procurements under the simplified
acquisition threshold at the VA.
7. Market Research
A commenter noted the importance of reinforcing, especially for
delivery of patient care and services procurements for Veterans Affairs
Medical Centers (VAMCs), that robust market research be conducted, and
that set-asides and awards be determined in accordance with those
findings.
VA agrees that market research including industry engagement are
key elements in the decision-making process for any acquisition. It is
VA's intention to comply with all legislative and legal requirements,
including VFCP, while providing the best care and maximum resources to
address the needs of the Veteran community we serve. VA is in the
process of releasing other parts dealing with competition, acquisition
planning and market research. They will be published in the Federal
Register for public comment once the appropriate approvals are
obtained. Accordingly, no language will be changed in the rule based on
these comments.
[[Page 16904]]
8. Training of the VA Acquisition Workforce on This Proposed Rule
A commenter would like to know how and when contracting officers,
staff, and local Veterans Affairs Medical Centers (VAMCs) will be
trained on these revised requirements. The commenter recommends VA
release an implementation plan and deadline for each phase of the
large-scale VAAR revision. Currently, no implementation date is listed
in the Federal Register notice.
VA also supports the importance of training as highlighted by our
investment in training for the acquisition workforce at the VA
Acquisition Academy (VAAA). Training on various VAAR revised policy and
procedures, as well as internal agency guidance, is currently being
provided on an ongoing basis through the VAAA, as well as local and
national conferences and other training events as necessary. We
continue to update and revise internal training material to address VA
acquisition workforce needs and will continue to ensure appropriate
training is scheduled and accomplished on both a one-time or recurring
basis as the topics and needs may dictate. VA continues to publish
proposed rules for public comment in phased increments and is working
closely with the Office of Small and Disadvantaged Business Utilization
(OSDBU) to address concerns of the small business community, in
particular SDVOSBs and VOSBs. VA submits updates to its planned
regulatory agenda two times a year. Any updates and new planned
regulatory actions concerning specific VAAR parts will be published
there. The case containing the proposed rule for VAAR part 819,
including the Veterans First Contracting Program under subpart 819.70,
and key affected parts is planned for publication in the Federal
Register for public comment in 2019.
9. Removal of Internal Procedural Guidance From the VAAR
A commenter inquired if VA anticipates the need to develop and
issue specific procurement policy memorandums, directives, handbooks,
and standard operating procedures given the removal of internal
procedural guidance from the VAAR. The commenter also questioned the
timely issuance of information and updates to internal procedural
manuals.
VA is currently updating its acquisition policies and regulations.
As each part is completed, any internal documents that require updating
would be updated to comport with the new regulations. The VA
Acquisition Manual will incorporate many of the related internal
procedural guidance at the VA-wide level and will be published on the
VA OAL/PPS website when any new VAAR parts are published as effective
in the Federal Register. Any additional internal policy and procedures
at various levels and activities in the VA are being examined and will
be appropriately updated or created, as needed.
Technical Non-Substantive Changes to the Proposed Rule
1. Under section 813.003-70(a), this final rule adds a reference to
FAR part 13 in conjunction with FAR part 19 as a more accurate
reference; and in paragraph (d) changes a reference from FAR part 19 to
the Small Business Administration (SBA) regulations at 13 CFR part 121
and 13 CFR 125.6 to provide clarity.
2. In the proposed rule, VA intended to remove 813.202, Purchase
guidelines, include a new section 813.203, and add revised language at
813.203, Purchase guidelines, to comport with the FAR. VA is removing
the guidance from the VAAR and may place the guidance in the VAAM. As a
part of this final rule, VA will remove the current section 813.202 and
take no action on proposed 813.203.
3. This final rule revises the VAAR part 852 authorities to reflect
the authorities recently codified in a previous rule.
4. Under 813.307, VA proposed to remove the section which
references the use of forms and move mention of forms as internal VA
guidance to the VA Acquisition Manual. The forms referenced in 813.307
which will be removed with this final rule, are both referenced, and in
some cases, were prescribed at 853.213 as well. With the removal of
813.307 in this final rule, the forms require removal from the VAAR as
well, so with this final rule, section 853.213 will be removed and any
of the noted forms if and when still used at VA, are available on VA's
public facing website at https://www.va.gov/vaforms/ or upon request
from any VA contracting office.
Unfunded Mandates
The Unfunded Mandates Reform Act of 1995 requires, at 2 U.S.C.
1532, that agencies prepare an assessment of anticipated costs and
benefits before issuing any rule that may result in the expenditure by
State, local, and tribal governments, in the aggregate, or by the
private sector, of $100 million or more (adjusted annually for
inflation) in any one year. This final rule will have no such effect on
State, local, and tribal governments or on the private sector.
Paperwork Reduction Act
This rulemaking impacts two existing information collection
requirements associated with two Office of Management and Budget (OMB)
control numbers. The Paperwork Reduction Act of 1995 (at 44 U.S.C.
3507) requires that VA consider the impact of paperwork and other
information collection burdens imposed on the public. Under 44 U.S.C.
3507(a), an agency may not collect or sponsor the collection of
information, nor may it impose an information collection requirement
unless it displays a currently valid OMB control number.
Although this action contains provisions constituting collections
of information at 48 CFR part 813, under the provisions of the
Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3521), no new or
revised collections of information are associated with this final rule.
The information collection requirements for 48 CFR part 813 are
currently approved by OMB and have been assigned OMB control number
2900-0393.
Although this final rule removes 813.307, Forms, with this action
853.213, Simplified acquisition procedures (SF's 18, 30, 44, 1165,
1449, and OF's 336, 347, and 348), will also be removed as the forms
now shown in the text at 853.213 are also referenced within section
813.307, making their continued inclusion in VAAR part 853 unnecessary.
In particular, one of the forms referenced at 813.307(f), VA Form 10-
2421, Prosthetic Authorization for Items or Services, and at
853.213(d), has an associated OMB Control Number although it is not
currently associated with the VAAR. Under the provisions of Paperwork
Reduction Act of 1995 (44 U.S.C. 3501-3521), no new or revised
collections of information are associated with this final rule. The
information collection requirements for VA Form 10-2421 are currently
approved by OMB and have been assigned OMB control number 2900-0188
under the administrative management of the Veterans Health
Administration. This form will no longer be referenced in the VAAR and
its OMB control number is not now associated with the VAAR.
Congressional Review Act
Pursuant to the Congressional Review Act (5 U.S.C. 801 et seq.),
the Office of Information and Regulatory Affairs designated this rule
as not a major rule, as defined by 5 U.S.C. 804(2).
[[Page 16905]]
Regulatory Flexibility Act
The Secretary hereby certifies that this final rule will not have a
significant economic impact on a substantial number of small entities
as they are defined in the Regulatory Flexibility Act (5 U.S.C. 601-
612). This rulemaking does not change VA's policy regarding small
businesses, does not have an economic impact to individual businesses,
and there are no increased or decreased costs to small business
entities. On this basis, the final rule would not have an economic
impact on a substantial number of small entities as they are defined in
the Regulatory Flexibility Act, 5 U.S.C. 601-612. Therefore, pursuant
to 5 U.S.C. 605(b), the initial and final regulatory flexibility
analysis requirements of 5 U.S.C. 603 and 604 do not apply.
Executive Orders 12866, 13563 and 13771
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.
The Office of Information and Regulatory Affairs has determined that
this rule is a significant regulatory action under Executive Order
12866. VA's impact analysis can be found as a supporting document at
http://www.regulations.gov, usually within 48 hours after the
rulemaking document is published. Additionally, a copy of the
rulemaking and its impact analysis are available on VA's website at
http://www.va.gov/orpm by following the link for ``VA Regulations
Published from FY 2004 Through Fiscal Year to Date.'' This final rule
is not subject to the requirements of E.O. 13771 because this final
rule is expected to result in no more than de minimis costs.
List of Subjects
48 CFR Parts 812, 813, and 853
Government procurement.
48 CFR Part 852
Government procurement, Reporting and recordkeeping requirements.
Signing Authority
The Secretary of Veterans Affairs, or designee, approved this
document and authorized the undersigned to sign and submit the document
to the Office of the Federal Register for publication electronically as
an official document of the Department of Veterans Affairs. Pamela
Powers, Chief of Staff, Department of Veterans Affairs, approved this
document on March 2, 2020, for publication.
Consuela Benjamin,
Regulation Development Coordinator, Office of Regulation Policy &
Management, Office of the Secretary, Department of Veterans Affairs.
For the reasons set out in the preamble, VA amends 48 CFR parts
812, 813, 852, and 853 as follows:
PART 812--ACQUISITION OF COMMERCIAL ITEMS
0
1. The authority citation for part 812 is revised to read as follows:
Authority: 38 U.S.C. 8127-8128; 40 U.S.C. 121(c); 41 U.S.C. 1702
and 48 CFR 1.301 through 1.304.
Subpart 812.1--Acquisition of Commercial Items--General
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2. Section 812.102 is revised to read as follows:
812.102 Applicability.
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3. Section 812.102-70 is added to subpart 812.1 to read as follows:
812.102-70 Applicability of Veterans preferences.
Based on the authority under 38 U.S.C. 8127 and 8128, the Veterans
First Contracting Program in subpart 819.70 applies to VA contracts
under this part. The provisions and clauses prescribed reflect agency
unique statutes applicable to the acquisition of commercial items.
Subpart 812.3--Solicitation Provisions and Contract Clauses for the
Acquisition of Commercial Items
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4. Section 812.301 is revised to read as follows:
812.301 Solicitation provisions and contract clauses for the
acquisition of commercial items.
(f)(1) Contracting officers shall insert the clause 852.212-70,
Provisions and Clauses Applicable to VA Acquisition of Commercial
Items, in all solicitations and contracts for commercial acquisitions
and check only those provisions and clauses that apply to the
individual acquisition.
(2) Contracting officers shall insert the clause 852.212-71, Gray
Market Items, in solicitations and contracts for new medical equipment
for VA Medical Centers and that include FAR provisions 52.212-1,
Instruction to Offerors--Commercial Items, and 52.212-2, Evaluation--
Commercial Items.
812.302 [Removed]
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5. Section 812.302 is removed.
PART 813--SIMPLIFIED ACQUISITION PROCEDURES
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6. The authority citation for part 813 is revised to read as follows:
Authority: 38 U.S.C. 8127-8128; 40 U.S.C. 121(c); 41 U.S.C.
1702 and 48 CFR 1.301 through 1.304.
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7. Section 813.003-70 is added to read as follows:
813.003-70 Policy.
(a) The Veterans First Contracting Program in subpart 819.70
applies to VA contracts, orders and BPAs under this part and has
precedence over other small business programs referenced in FAR parts
13 and 19.
(b) Notwithstanding FAR 13.003(b)(2), the contracting officer shall
make an award utilizing the priorities for veteran-owned small
businesses as implemented within the VA hierarchy of small business
program preferences, the Veterans First Contracting Program in subpart
819.70. Specifically, the contracting officer shall consider
preferences for verified service-disabled veteran-owned small
businesses (SDVOSBs) first, then preferences for verified veteran-owned
small businesses (VOSBs). These priorities will be followed by
preferences for other small businesses in accordance with FAR 19.203,
and 819.7004.
(c) When using competitive procedures, the preference for
restricting competition to verified SDVOSBs/VOSBs in accordance with
paragraph (b) of this section is mandatory whenever market research
provides a reasonable expectation of receiving two or more offers/
quotes from eligible, capable and verified firms at fair and reasonable
prices that offer best value to the Government.
(1) Pursuant to 38 U.S.C. 8127, contracts under this part shall be
set-aside for SDVOSBs/VOSBs, in accordance with 819.7005 or 819.7006
when supported by market research. Contracting officers shall use the
applicable set-aside clause prescribed at 819.7009.
(2) Pursuant to 38 U.S.C. 8128 and to the extent that market
research does not support an SDVOSB or VOSB set-aside, the contracting
officer shall include evaluation factors as prescribed at 815.304 and
the evaluation criteria clause prescribed at 815.304-71(a).
[[Page 16906]]
(d) The SDVOSB and VOSB eligibility requirements in 819.7003 apply,
including verification of the SDVOSB and VOSB status of an offeror, and
other small business requirements in 13 CFR part 121 and 13 CFR 125.6
(e.g., small business representation, nonmanufacturer rule, and
subcontracting limitations).
Subpart 813.1--Procedures
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8. Section 813.102 is added to subpart 813.1 to read as follows:
813.102 Source list.
Pursuant to 819.7003, contracting officers shall use the Vendor
Information Pages (VIP) database to verify SDVOSB/VOSB status.
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9. Revise section 813.106 to read as follows:
813.106 Soliciting competition, evaluation of quotations or offers,
award and documentation.
813.106-3 [Removed]
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10. Section 813.106-3 is removed.
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11. Section 813.106-70 is revised to read as follows:
813.106-70 Soliciting competition, evaluation of quotations or offers,
award and documentation--the Veterans First Contracting Program.
(a) When using competitive procedures under this part, the
contracting officer shall use the Veterans First Contracting Program in
subpart 819.70 and the guidance set forth in 813.003-70.
(b) Pursuant to 38 U.S.C 8127(b), contracting officers may use
other than competitive procedures to enter into a contract with a
verified SDVOSB or VOSB for procurements under the simplified
acquisition threshold, as authorized by FAR 6.302-5.
(c) For procurements above the simplified acquisition threshold,
pursuant to 38 U.S.C. 8127(c), contracting officers may also award a
contract under this part to a firm verified under the Veterans First
Contracting Program at subpart 819.70, using procedures other than
competitive procedures, as authorized by FAR 6.302-5 and in accordance
with 819.7007 and 819.7008.
Subpart 813.2--[Removed and Reserved]
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12. Subpart 813.2 is removed and reserved.
Subpart 813.3--Simplified Acquisition Methods
813.302 [Removed]
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13. Section 813.302 is removed.
813.302-5 [Removed]
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14. Section 813.302-5 is removed.
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15. Section 813.305-70 is added to subpart 813.3 to read as follows:
813.305-70 VA's imprest funds and third party drafts policy.
VA's Governmentwide commercial purchase card and/or convenience
checks shall be used in lieu of imprest funds and third party drafts.
813.307 [Removed]
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16. Section 813.307 is removed.
PART 852--SOLICITATION PROVISIONS AND CONTRACT CLAUSES
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17. The authority citation for part 852 is revised to read as follows:
Authority: 38 U.S.C. 8127-8128, and 8151-8153; 40 U.S.C. 121(c);
41 U.S.C. 1121(c)(3), 41 U.S.C. 1303; 41 U.S.C. 1702; and 48 CFR
1.301 through 1.304.
Subpart 852.2--Texts of Provisions and Clauses
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18. Section 852.212-70 is added to read as follows:
852.212-70 Provisions and Clauses Applicable to VA Acquisition of
Commercial Items.
As prescribed in 812.301(f)(1), insert the following clause to
indicate provisions and clauses applicable to this acquisition:
Provisions and Clauses Applicable to VA Acquisition of Commercial Items
(APR 2020)
(a) The Contractor agrees to comply with any provision or clause
that is incorporated herein by reference or full text to implement
agency policy applicable to acquisition of commercial items or
components. The following provisions and clauses that have been
checked by the Contracting Officer are incorporated by reference or
in full text. Text requiring fill-ins is shown under the clause or
provision title:
__852.203-70, Commercial Advertising.
__852.209-70, Organizational Conflicts of Interest.
__852.214-71, Restrictions on Alternate Item(s).
__852.214-72, Alternate Item(s).
Bids on [Contracting Officer will insert an alternate item that
is considered acceptable] will be given equal consideration along
with bids on [Contracting Officer will insert the required item and
item number]** and any such bids received may be accepted if to the
advantage of the Government. Tie bids will be decided in favor of
[Contracting Officer will insert the required item and item number].
(End of provision)
__852.214-73, Alternate Packaging and Packing.
__852.214-74, Marking of Bid Samples.
__852.215-70, Service-Disabled Veteran-Owned and Veteran-Owned Small
Business Evaluation Factors.
__852.215-71, Evaluation Factor Commitments.
__852.216-71, Economic Price Adjustment of Contract Price(s) Based
on a Price Index.
__852.216-72, Proportional Economic Price Adjustment of Contract
Price(s) Based on a Price Index.
__852.216-73, Economic Price Adjustment--State Nursing Home Care for
Veterans.
__852.216-74, Economic Price Adjustment--Medicaid Labor Rates.
__852.216-75, Economic Price Adjustment--Fuel Surcharge.
__852.219-9, VA Small Business Subcontracting Plan Minimum
Requirements.
__852.219-10, VA Notice of Total Service-Disabled Veteran-Owned
Small Business Set-Aside.
__852.219-11, VA Notice of Total Veteran-Owned Small Business Set-
Aside.
__852.222-70, Contract Work Hours and Safety Standards Act--Nursing
Home Care Contract Supplement.
__852.228-70, Bond Premium Adjustment.
__852.228-71, Indemnification and Insurance.
__852.228-72, Assisting Service-Disabled Veteran-Owned and Veteran-
Owned Small Businesses in Obtaining Bonds.
__852.229-70, Sales and Use Taxes.
__852.232-72, Electronic Submission of Payment Requests.
__852.233-70, Protest Content/Alternative Dispute Resolution.
__852.233-71, Alternate Protest Procedure.
__852.237-7, Indemnification and Medical Liability Insurance.
__852.237-70, Contractor Responsibilities.
The Contractor shall obtain all necessary licenses and/or
permits required to perform this work. He/she shall take all
reasonable precautions necessary to protect persons and property
from injury or damage during the performance of this contract. He/
she shall be responsible for any injury to himself/herself, his/her
employees, as well as for any damage to personal or public property
that occurs during the performance of this contract that is caused
by his/her employees fault or negligence, and shall maintain
personal liability and property damage insurance having coverage for
a limit as required by the laws of the State of ___[Insert name of
State]. Further, it is agreed that any negligence of the Government,
its officers, agents, servants and employees, shall not be the
responsibility of the Contractor hereunder with the regard to any
claims, loss, damage, injury, and liability resulting therefrom.
(End of clause)
[[Page 16907]]
__852.246-70, Guarantee.
The Contractor guarantees the equipment against defective
material, workmanship and performance for a period of ___[Normally,
insert one year. If industry policy covers a shorter or longer
period, i.e., 90 days or for the life of the equipment, insert such
period.], said guarantee to run from date of acceptance of the
equipment by the Government. The Contractor agrees to furnish,
without cost to the Government, replacement of all parts and
material that are found to be defective during the guarantee period.
Replacement of material and parts will be furnished to the
Government at the point of installation, if installation is within
the continental United States, or f.o.b. the continental U.S. port
to be designated by the Contracting Officer if installation is
outside of the continental United States. Cost of installation of
replacement material and parts shall be borne by the contractor.
[The above clause will be modified to conform to standards of the
industry involved.]
(End of clause)
__852.246-71, Inspection or Alternate I.
__852.246-72, Frozen Processed Foods.
__852.246-73, Noncompliance with packaging, packing, and/or marking
requirements.
__852.270-1, Representatives of Contracting Officers.
__852.270-2, Bread and Bakery Products--Quantities.
__852.270-3, Purchase of Shellfish.
__852.271-72, Time Spent by Counselee in Counseling Process.
__852.271-73, Use and Publication of Counseling Results.
__852.271-74, Inspection.
__852.271-75, Extension of Contract Period.
__852.273-70, Late Offers.
__852.273-71, Alternative Negotiation Techniques.
__852.273-72, Alternative Evaluation.
__852.273-73, Evaluation--Health-Care Resources.
__852.273-74, Award without Exchanges.
(b) When appropriate and in accordance with the prescriptions
for the clause, the contracting officer may use the following clause
in requests for quotations, solicitations, and contracts for the
acquisition of commercial items if the contracting officer
determines that the use is consistent with customary commercial
practices:
__852.211-70, Service Data Manuals or Alternate I.
(c) All requests for quotations, solicitations, and contracts
for commercial item services to be provided to beneficiaries must
include the following clause at
__852.271-70, Nondiscrimination in Services Provided to
Beneficiaries.
(End of clause)
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19. Section 852.212-71 is added to read as follows:
852.212-71 Gray Market Items.
As prescribed in 812.301(f)(2), insert the following provision in
solicitations and contracts for new medical equipment:
Gray Market Items (APR 2020)
(a) No gray market or remanufactured items will be acceptable.
Gray market items are Original Equipment Manufacturers' (OEM) goods
sold through unauthorized channels in direct competition with
authorized distributors. This procurement is for new OEM medical
equipment only for VA medical facilities.
(b) Vendor shall be an OEM, authorized dealer, authorized
distributor or authorized reseller for the proposed equipment/
system, verified by an authorization letter or other documents from
the OEM. All software licensing, warranty and service associated
with the equipment/system shall be in accordance with the OEM terms
and conditions.
(End of clause)
PART 853--FORMS
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20. The authority citation for part 853 is revised to read as follows:
Authority: 38 U.S.C. 501; 40 U.S.C. 121(c); and 48 CFR 1.301
through 1.304.
853.213 [Removed]
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21. Section 853.213 is removed.
[FR Doc. 2020-05589 Filed 3-24-20; 8:45 am]
BILLING CODE 8320-01-P
