VA Acquisition Regulation: Competition Requirements
| Published date | 30 September 2021 |
| Citation | 86 FR 54111 |
| Record Number | 2021-20926 |
| Section | Rules and Regulations |
| Court | Veterans Affairs Department |
54111
Federal Register / Vol. 86, No. 187 / Thursday, September 30, 2021 / Rules and Regulations
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[FR Doc. 2021–20859 Filed 9–29–21; 8:45 am]
BILLING CODE 6560–50–P
NATIONAL SCIENCE FOUNDATION
45 CFR Part 670
RIN 3145–AA62
Conservation of Antarctic Animals and
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[FR Doc. 2021–21079 Filed 9–29–21; 8:45 am]
BILLING CODE 7555–01–P
DEPARTMENT OF VETERANS
AFFAIRS
48 CFR Part 806
RIN 2900–AQ21
VA Acquisition Regulation:
Competition Requirements
AGENCY
: Department of Veterans Affairs.
ACTION
: Final rule.
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remove any policy superseded by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 Federal Acquisition
Regulation (FAR), to move procedural
guidance internal to VA into the VA
Acquisition Manual (VAAM), and to
incorporate any new agency specific
regulations or policies. This rulemaking
revises VAAR coverage concerning
Competition Requirements.
DATES
: This rule is effective on
November 1, 2021.
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
: These
changes seek to align the VAAR with
the FAR, remove outdated and
duplicative requirements, and reduce
burden on contractors. The VAAM
incorporates portions of the removed
VAAR as well as other internal agency
procedural guidance. VA will rewrite
certain parts of the VAAR and VAAM,
and as VAAR parts are rewritten, VA
will publish them in the Federal
Register.
On February 1, 2019, VA published a
proposed rule in the Federal Register
(84 FR 1041) which announced VA’s
intent to amend regulations for VAAR
Case RIN 2900–AQ21—VA Acquisition
Regulation: Competition Requirements.
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 April 2, 2019, and VA
received comments from six
respondents. This rule adopts as a final
rule the proposed rule published in the
Federal Register on February 1, 2019,
with the exception of minor formatting/
grammatical edits and a few non-
substantive edits, which are described
below.
In particular, this final rule adds
section 806.004–70, Definition, to
establish that as used in part 806,
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‘‘health-care resource(s)’’ has the same
definition as that provided in VAAR
873.102.
This final rule adds subpart
806.1—Full and Open Competition, and
section 806.102, Use of competitive
procedures, to address the application
of 38 U.S.C. 8127 to competitive General
Services Administration (GSA) and VA
Federal Supply Schedules.
This rule also adds subpart
806.2—Full and Open Competition
After Exclusion of Sources, which
contains two sections: 806.203, Set-
asides for small business concerns,
which directs attention to subparts
819.5 and 819.70 for VA’s policies on
set-asides for small business concerns,
and 806.270, Set-asides for verified
Veteran-owned small businesses. This
rulemaking, in section 806.270, sets
forth VA’s authority under VA’s
supplement to FAR part 6—VAAR part
806, and the requirement mandated by
38 U.S.C. 8127(d)—referred to as the VA
Rule of Two, to conduct set-asides for
Veteran-owned small businesses
whenever market research provides the
contracting officer with a reasonable
expectation of receiving two or more
offers/quotes from eligible and verified
service-disabled veteran-owned small
businesses (SDVOSBs) or veteran-
owned small businesses (VOSBs), and
award can be made at a fair and
reasonable price that offers best value to
the Government. This section also states
that the requirement to set aside
procurements for Veteran-owned small
businesses applies to all contracts under
this regulation, including orders under
interagency acquisition vehicles such as
the Federal Supply Schedules (FSS).
As a part of this rulemaking, subpart
806.3—Other Than Full and Open
Competition, is revised to add specific
reference to VA’s authority for
noncompetitive procedures for verified
Veteran-owned small businesses and to
clarify existing authorities regarding
such noncompetitive procedures. The
revised subpart also clarifies existing
statutory authority for other VA unique
authorities and updates new Title 41
citations and other specific citation
requirements.
This final rule amends section
806.302, Circumstances permitting other
than full and open competition, to add
several sections. This rule also revises
section 806.302–5, Authorized or
required by statute, to remove its text
and retain the title. The removed text
has been revised and moved to section
806.302–571.
Under section 806.302–5, this final
rule adds two sections: 806.302–570 and
806.302–571. Section 806.302–570,
Noncompetitive procedures for verified
Veteran-owned small businesses,
provides coverage of the authority to
enter into contracts non-competitively,
when specifically authorized under the
VA Veterans First Contracting Program
in accordance with VAAR 819.7007 or
819.7008.
Section 806.302–571, Authorized or
required by statute—VA unique
authorities, contains the statutes
previously listed in 806.302–5 and
provides policy under the statutes to
make awards by other than full and
open competition. Paragraph (a)
provides the updated Title 41
authority—41 U.S.C. 3304(a)(5),
updated from the moved coverage under
806.302–5. Paragraph (b)(1) provides
that full and open competition is not
required for the acquisition of prosthetic
appliances and services based on the
authority under 38 U.S.C. 8123.
Paragraph (b)(2) provides the existing
policy for the acquisition of commercial
health-care resources, use of medical
equipment or space, or research
acquired from an institution affiliated
with VA under the authority set forth in
38 U.S.C. 8153(a)(3)(A). Paragraph (b)(3)
includes policy for the acquisition of
commercial health-care resources, the
use of medical equipment or space from
other than an affiliated institution, but
only when conducted in accordance
with simplified procedures in VAAR
part 873, Simplified Acquisition
Procedures for Health-Care Resources,
under the authority set forth in 38
U.S.C. 8153(a)(3)(B). Paragraph (b)(4)
provides the authority under 38 U.S.C.
8153(a)(3)(C)-(D) for the sole source
acquisition of commercial health-care
resources, the use of medical equipment
or space, when not acquired from an
affiliated institution in accordance with
paragraph (b)(2).
Section 806.302–571, paragraph (c),
requires that contracts awarded using
the authority set forth under paragraph
(a), with the exception of acquisitions
authorized under paragraph (b)(2) of
this section, shall be supported by the
written justifications and approvals
described in FAR 6.303 and 6.304.
Section 806.302–571, paragraph (d),
incorporates an updated Title 41
citation reference: 41 U.S.C. 3304(a)(5);
defines specific authorities that permit
VA to procure certain supplies and
services as sole source awards; and
requires contracting officers, pursuant to
FAR 6.302–5(c)(2)(ii), to comply with
written justification and approval
requirements set forth in FAR 6.303 and
6.304, citing 41 U.S.C. 3304(a)(5) and
the applicable statute. Specifically,
section 806.302–571(d) contains
authorities previously under section
806.302–5 and continues existing policy
to allow VA to enter into contracts for
the cited types of supplies and services
under this section.
This rulemaking removes section
806.302–7, Public interest, as it provides
internal procedural guidance not having
a significant effect beyond the internal
operating procedures of the VA (see
FAR 1.301(b)) and moves the coverage
to the VAAM.
This final rule also removes section
806.304, Approval of the justification, as
it provides internal procedural guidance
not having a significant effect beyond
the internal operating procedures of the
VA (see FAR 1.301(b)) and which will
be moved to the VAAM.
The proposed rule revised subpart
806.5—Competition Advocates to
amend the title to ‘‘Advocates for
Competition’’ to conform to the revised
title in FAR part 6. The proposed rule
also revised section 806.501,
Requirement, to identify the Deputy
Senior Procurement Executive as the VA
Advocate for Competition. However,
subsequent to publication of the
proposed rule, VA organizational
changes resulted in the need to update
the title of who in VA is assigned the
role of the VA Advocate for
Competition. This is now updated in
this final rule as described in item six
in the Technical Non-Substantive
Changes section of the preamble.
This final rule removes section
806.570, Planning requirements, as it
provides internal procedural guidance
not having a significant effect beyond
the internal operating procedures of the
VA (see FAR 1.301(b)) and the coverage
has been moved to the VAAM.
VA provided a 60-day comment
period for the public to respond to the
proposed rule. As stated previously, VA
received comments from six
respondents.
A summary of the comments and the
issues raised are provided as follows:
One commenter posted a general
comment regarding advances in health
care in what appears to be part of an
academic exercise. VA appreciates the
comment. As the comment does not
specifically address issues with the
proposed rule, VA is making no
revisions as a result of the comment.
Another respondent suggests that
moving items into the VAAM and
eliminating Information Letters (ILs)
and various procedural guidance is a
positive move. They also note that the
VAAM is a better alternative than
continued reliance on sub-agency
procurement manuals. VA appreciates
the comment on the proposed rule. The
VAAR/VAAM project objective is to
remove procedural guidance that is
internal to VA and move it into the VA
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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 comment
does not require the VA to make any
revisions to the proposed rule.
The third commenter submits that the
Class Deviations and other guidance
issued by VA in response to the
Supreme Court’s decision in
Kingdomware Technologies, Inc. v.
United States, 136 S. Ct. 1969 (2016),
recognize that the Javits-Wagner-O’Day
Act’s (JWOD) mandatory requirement to
purchase from the Procurement List is
capable of coexisting with the VA Rule
of Two. The commenter states that the
current guidance provides that the
products and services on the AbilityOne
Procurement List are mandatory sources
but the VA Rule of Two is to be applied
before adding new VA requirements to
the Procurement List. To avoid any
doubt that the February 9, 2018, class
deviation is still in effect, the
commenter urges the VA to clarify that
VAAR 806.270 does not supersede
VAAR 808.002 or the February 9, 2018,
class deviation.
VA appreciates the comments. The
respondent’s comments concerning
mandatory sources are appropriately
addressed in the proposed rule
pertaining to VAAR part 808 and related
clauses and provisions. Since the rule
(RIN 2900–AQ21) was published for
public comment, new legislation
impacting AbilityOne was signed into
law on August 8, 2020 (see further
description regarding this below and the
class deviation to VAAR 808.002 issued
on August 14, 2020, that addresses the
priority of the AbilityOne program in
relation to the Veterans First
Contracting Program, with certain
exceptions). As these comments do not
pertain to the language and text in this
rule for VAAR part 806, VA is making
no changes based on these comments.
The fourth respondent also
commented on this rule and its relation
to AbilityOne, supporting the primacy
of JWOD as a mandatory source and
states that ‘‘this section of the VAAR
should also recognize that non-
mandatory source competition is not
required where a mandatory source
applies, and that the JWOD, and other
statutes, direct agencies to purchase
certain products and services from
mandatory sources.’’ The commenter
also recommends revising the part to
recognize that specified sources include
the mandatory sources identified in
FAR 8.002, 8.004, and subpart 8.7.
While VA appreciates the feedback
from the respondents on this proposed
rule, the Veterans First Contracting
Program was updated as a result of
amendments to 38 U.S.C. 8127 by
Public Law 116–155, the Department of
Veterans Affairs Contracting Preference
Consistency Act of 2020, signed August
8, 2020, which requires the use of
mandatory Government sources under
the AbilityOne program for covered
products and services except for certain
previously awarded contracts to service-
disabled veteran-owned small
businesses (SDVOSBs) and veteran-
owned small businesses (VOSBs) after
December 22, 2006, and in effect August
7, 2020. This is implemented in VAAR
808.002(a)(1)(iv) and (a)(2). VA
originally issued a Class Deviation on
August 14, 2020, to make this change
pending publication of a rule; this
deviation was rescinded and replaced
with Class Deviation from VA
Acquisition Regulation part 808,
Required Sources of Supplies and
Services, dated July 20, 2021. The
priorities for use of mandatory
Government sources are covered by FAR
part 8 and VAAR part 808, respectively.
The language as set forth in VAAR part
806 and specifically at VAAR 806.270
fully comports with VA’s requirements
under VAAR part 808. VA will not
revise the final rule as a result of this
comment. Note: VA is also planning an
interim rule which would include a
pointer at subpart 819.5 back to
808.002(a)(1)(iv) and (a)(2) regarding the
AbilityOne program to ensure
contracting officers and the public are
reminded of the priority use of the
AbilityOne program as set forth in
VAAR 808.002.
The next respondent had multiple
comments and the VA will address each
in order. After first commending VA for
its thoughtful development of the
proposed rule, the commenter
recommends that VAAR 806.501 be
revised to include the actual list of
Advocates for Competition. The
commenter also states that VAAR
806.501 could be further improved by
including a requirement to identify the
cognizant SBA Procurement Center
Representative, the VA Ombudsman,
and the VA Advocate for Competition in
each solicitation above the simplified
acquisition threshold.
VA has considered this suggestion but
requiring each solicitation or contract to
include a list is beyond the
requirements of FAR 6.501 that VA is
implementing at VAAR 806.501.
However, VA is making available a
complete list of VA procuring activity
Advocates for Competition on its
website that will be available when the
final rule is published. Therefore, VA is
making no changes to the proposed rule
as a result of this comment.
The next comment recommended
revisions to VAAR 806.270; specifically,
that VAAR 806.270 be modified to
exclude references to Class Deviation
provisions and that VA remove the
reference to ‘‘the VA Rule of Two (see
802.101)’’ from the final version of
VAAR 806.270 as the definition of ‘‘VA
Rule of Two’’ was not added to VAAR
802.101 via the required notice and
public comment rulemaking process.
VA appreciates the comment and
responds that the VA Rule of Two is a
term that is defined and incorporated
into 802.101 under a Class Deviation
and it will be incorporated into part 802
as a part of a future proposed rule.
Nevertheless, to avoid any confusion,
section 806.270 has been revised to
remove the reference, ‘‘see 802.101.’’
The respondent also comments that
the VAAR must fully implement the
Vets Act Priority for SDVOSBs first, and
then VOSBs. The commenter states VA
should further explain how contracting
officers give full credit and partial credit
for VOSBs and to address its use in
Lowest Priced Technically Acceptable
(LPTA) procurements that do not permit
tradeoffs. They believe that a new
provision should be added to VAAR
852.215–70.
VA appreciates the comments. The
respondent’s comments concerning
852.215–70 were appropriately
addressed in the rule RIN 2900–AQ20
pertaining to VAAR part 815 and related
clauses and provisions. Therefore, as
these comments do not pertain to the
language and text in this rule for VAAR
part 806, VA is making no changes
based on these comments. However, VA
is clarifying section 806.270 to make
clear that the statute’s required set aside
priorities are for SDVOSBs first, then
VOSBs by adding the words ‘‘first, then
. . .’’ after ‘‘(SDVOSBs)’’, and removing
the word ‘‘and’’ so that it now reads,
‘‘. . . verified service-disabled Veteran-
owned small businesses (SDVOSBs)
first, then Veteran-owned small
businesses (VOSBs).’’ This clarification
is consistent with 38 U.S.C. 8127.
The same respondent recommends
the proposed rule should be revised as
a reference in the preamble of the
proposed rule to additional internal
requirements is problematic in their
opinion. When VA issues the final rule,
it should explain in the preamble that
the only requirements for a VA
contracting officer to issue a sole source
contract under the Vets Act are as
specified in the text of VAAR 806.302–
570, and there are no unspecified
agency procedures or class deviations
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that would restrict or water down this
unique and important tool.
VA appreciates the opportunity to
make clear the requirements of this
section and what is set forth in the
preamble. VA’s internal procedures,
including review and approval
thresholds, are properly contained in
the VAAM as authorized by FAR
1.301(a)(2) which authorizes an agency
head to issue or authorize the issuance
of internal agency guidance. While 38
U.S.C. 8127(c) provides the authority for
when awards to such sole source
concerns may be made, VA implements
required internal review and approval
oversight procedures as necessary.
Therefore, VA makes no changes to the
rule on the basis of these comments.
The same commenter asserts that VA
should provide Contracting Officers
guidance regarding what constitutes a
fair and reasonable price.
VA notes that guidance on how to
conduct a price analysis and establish a
fair and reasonable price determination
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 price
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
contracting officers’ skillset in this area.
VA is making no changes to the rule
based on these comments.
The same commenter recommends
VA revise VAAR 806.302–570(a) to state
that the sole source contract shall be
supported ‘‘by the applicable
justification and approval requirements
of FAR 6.302–5(c)(2)(ii), 6.303, and
6.304.’’
VA has considered the comment and
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.’’ Accordingly,
section 806.302–570(a) has been revised
to add the word ‘‘applicable’’ as noted
in the amendatory language with respect
to the content of the justification
requirements.
The next comment takes issue with
the language ‘‘without regard to any
other provision of law’’ in VAAR
806.302–571(b)(1) and believes that the
other proposed sections of this rule may
create confusion as to whether this sole
source authority trumps the Vets Act
requirements for VA to give priority to
SDVOSBs and VOSBs in all VA
contracts. They go on to state, ‘‘The sole
source authorities cited in VAAR
806.302–571 do not trump the VA’s
obligations under the Vets Act. For
example, 38 U.S.C. 8123 provides,
permissively, that VA may procure
prosthetic appliances . . . without
regard to any other provision of law.’’
They submit that by contrast, the Vets
Act includes broader language that
mandates VA give priority to SDVOSBs
and VOSBs.
VA does not concur with the
respondent’s assessment and will make
no change based on these comments.
The legislative language provides VA
broad discretion in certain types of
procurements ‘‘without regard to any
other provision of law.’’
The last respondent provides the
following positive comments regarding
the proposed rule: ‘‘. . . strongly
supports the VA in their efforts to create
more flexibility in the contracting
process as well as efforts to reorganize
the community care programs through
the MISSION Act of 2018.’’
VA appreciates the comment. The
comment does not require VA to make
any revisions to the proposed rule as the
comments do not apply to this rule.
Technical Non-Substantive Changes to
the Proposed Rule
This rule makes six non-substantive
changes to the proposed rule to provide
clarity, eliminate confusion, and to
ensure compliance with statute and
VA’s authority.
1. Under section 806.270, Set-asides
for verified Veteran-owned small
businesses, VA has revised the language
to remove the phrase ‘‘including
Governmentwide acquisition contracts
(GWACs)’’ as unnecessary to set forth
specifically further types of contract
vehicles.
2. Under section 806.302–571,
Authorized or required by statute—VA
unique authorities, VA has revised the
language in paragraph (b)(1) to remove
the phrase at the end of the
subparagraph: ‘‘as set forth in VA
directives governing prosthetic
appliances, sensory aids and services
supporting the same . . .’’ as
unnecessary. VA contracting officers are
already required to follow VA directives
and are internal operating procedures.
3. Under section 806.302–571,
paragraph (b)(2), VA is revising the
language to provide clarity by: Adding
‘‘Acquisition of resources from’’ in the
first sentence before ‘‘medical practice
groups’’ and to remove ‘‘affiliated’’
before ‘‘institution affiliated with VA.’’
4. Under section 806.302–571, at
paragraph (b)(3), VA is removing the
phrase ‘‘only if the procurement is
conducted’’ as too restrictive to VA’s
procurement authority in various
statutes and to ensure clarity. In
paragraph (b)(4), VA is revising the
authority citation at the end of the
paragraph to add ‘‘(D)’’ at the end so
that it now reads: (38 U.S.C.
8153(a)(3)(C)–(D)).
5. Under section 806.302–571,
paragraph (c), VA is making minor
grammatical edits to provide clarity by
revising the first sentence so that ‘‘this
authority’’ now reads ‘‘an authority’’
and by adding the words, ‘‘in this
section’’ so that the intro to the sentence
now reads: ‘‘Contracts awarded using an
authority in this section, . . .’’.
6. Under subpart 806.5, Advocates for
Competition, and the underlying section
806.501, Requirement, the section is
updated to reflect a new organization
role and title, to clarify the authority to
appoint an alternate agency advocate for
competition, and add the requirement to
designate procuring activity advocates
for competition in accordance with FAR
6.501. The section has been updated to
remove the title of Deputy Senior
Procurement Executive (DSPE) to reflect
the official organizational title of the
Associate Executive Director, Office of
Procurement Policy, Systems and
Oversight (AED/PPSO) and to add ‘‘for
the agency’’ after the phrase ‘‘VA
Advocate for Competition.’’ The
delegated authority is clarified that the
AED/PPSO may further delegate the
authority to appoint an alternate agency
advocate for competition, and to add
‘‘shall designate procuring activity
advocates for competition in accordance
with FAR 6.501.’’
Executive Orders 12866 and 13563
Executive Orders (EOs) 12866 and
13563 direct agencies to assess all costs
and benefits of available regulatory
alternatives and, when regulation is
necessary, to select regulatory
approaches that maximize net benefits
(including potential economic,
environmental, public health and safety
effects, and other advantages;
distributive impacts, and equity).
Executive Order 13563 (Improving
Regulation and Regulatory Review)
emphasizes the importance of
quantifying both costs and benefits,
reducing costs, harmonizing rules, and
promoting flexibility. The Office of
Information and Regulatory Affairs has
determined that this rule is not a
significant regulatory action under
Executive Order 12866. The Regulatory
Impact Analysis associated with this
rulemaking can be found as a
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supporting document at
www.regulations.gov.
Paperwork Reduction Act
This final rule contains no provisions
constituting a collection of information
under the Paperwork Reduction Act of
1995 (44 U.S.C. 3501–3521).
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). The rule primarily
affects the use of authorities that VA
contracting officers are already
authorized by statute to utilize when
required and in accordance with
existing agency regulation, policies and
procedures. This rule appropriately
clarifies and revises the use of such
authorities and when certain
justification and approval requirements
apply. The authorities were previously
codified in the VAAR either in this part
or in other parts, to include those
affecting small business programs, and
they affected both large and small
entities alike. With this rule, VA ensures
content to supplement the FAR for VA’s
unique service-disabled veteran-owned
small business and veteran-owned small
business program is properly
implemented in this part.
The overall impact of the rule is of
benefit to small businesses owned by
Veterans or service-disabled Veterans as
the VAAR is being updated to remove
extraneous procedural information that
applies only to VA’s internal operating
processes or procedures. This rule will
ensure clarity for both the public and
VA contracting officers to ensure that
when such authorities are utilized, they
are properly cited and, when required,
appropriately documented and
publicized. This rulemaking does not
change VA’s policy regarding small
businesses. VA estimates that no cost or
economic impact to individual
businesses will result from this rule
update. VA estimates this final rule is
not expected to result in increased or
decreased costs to small business
entities, and no more than de minimis
costs. On this basis, the final rule does
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.
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.
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.
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).
List of Subjects in 48 CFR Part 806
Government procurement.
Signing Authority
Denis McDonough, Secretary of
Veterans Affairs, approved this
document on September 1, 2021, 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.
Luvenia Potts,
Regulations Development Coordinator, Office
of Regulation Policy & Management, Office
of General Counsel, Department of Veterans
Affairs.
For the reasons set forth in the
preamble, VA revises 48 CFR part 806
to read as follows:
PART 806—COMPETITION
REQUIREMENTS
Sec.
806.004–70 Definition.
Subpart 806.1—Full and Open Competition
806.102 Use of competitive procedures.
Subpart 806.2—Full and Open Competition
After Exclusion of Sources
806.203 Set-asides for small business
concerns.
806.270 Set-asides for verified Veteran-
owned small businesses.
Subpart 806.3—Other Than Full and Open
Competition
806.302 Circumstances permitting other
than full and open competition.
806.302–5 Authorized or required by
statute.
806.302–570 Noncompetitive procedures
for verified Veteran-owned small
businesses.
806.302–571 Authorized or required by
statute—VA unique authorities.
Subpart 806.5—Advocates for Competition
806.501 Requirement.
Authority: 40 U.S.C. 121(c); 41 U.S.C.
1121(c)(3); 41 U.S.C. 1303; 41 U.S.C. 1702; 41
U.S.C. 3304; and 48 CFR 1.301 through 1.304.
806.004–70 Definition.
As used in this part—
Health-care resources has the same
definition as that provided in 873.102.
Subpart 806.1—Full and Open
Competition
806.102 Use of competitive procedures.
(d)(3) Awards made using General
Services Administration (GSA) or
Department of Veterans Affairs (VA)
Federal Supply Schedules (FSS) are
considered competitive when awarded
in accordance with the procedures
specified in FAR part 8 and this part.
Subpart 806.2—Full and Open
Competition After Exclusion of
Sources
806.203 Set-asides for small business
concerns.
(c) Subparts 819.5 and 819.70
prescribe the policies and procedures
that shall be followed with respect to
set-asides for small business and
Veteran-owned small business concerns.
806.270 Set-asides for verified Veteran-
owned small businesses.
(a) To fulfill the statutory
requirements relating to Public Law
109–461, the Veterans Benefits, Health
Care and Information Technology Act of
2006 (38 U.S.C. 8127–8128), contracting
officers shall set aside solicitations in
accordance with subpart 819.70 and the
VA Rule of Two for Vendor Information
Pages (VIP) verified service-disabled
Veteran-owned small businesses
(SDVOSBs) first, then Veteran-owned
small businesses (VOSBs) (see 819.7005
and 819.7006). (38 U.S.C. 8127–8128)
(b) The requirement in this section to
set aside procurements for VIP verified
SDVOSBs and VOSBs applies to all
types of contracts, including orders
placed under GSA’s Federal Supply
Schedules (FSS) and indefinite-delivery
contracts. (38 U.S.C. 8127–8128)
Subpart 806.3—Other Than Full and
Open Competition
806.302 Circumstances permitting other
than full and open competition.
806.302–5 Authorized or required by
statute.
806.302–570 Noncompetitive procedures
for verified Veteran-owned small
businesses.
(a) Sole source awards made to a
verified SDVOSB or VOSB. Full and
open competition need not be provided
for when awarding a sole source
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contract under paragraph (b) or (c) of
this section, to a verified SDVOSB or
VOSB in accordance with 819.7007 or
819.7008, respectively, as authorized.
Contracts awarded using the authority
in this paragraph (a) shall be supported
by the applicable justification and
approval requirements of FAR 6.302–
5(c)(2)(ii), 6.303, and 6.304.
(b) Sole source awards below the
simplified acquisition threshold.
(Citation: 41 U.S.C. 3304(a)(5), as
authorized by 38 U.S.C. 8127(b)). A
contracting officer may award a contract
under the authority in this paragraph (b)
to a VIP verified SDVOSB first, then
VOSB if no SDVOSBs can fulfill the
need, for an amount less than the
simplified acquisition threshold, using
procedures other than full and open
competition. (38 U.S.C. 8127)
(c) Sole source awards above the
simplified acquisition threshold.
(Citation: 41 U.S.C. 3304(a)(5), as
authorized by 38 U.S.C. 8127(c)). A
contracting officer may award a contract
to a VIP verified SDVOSB first, then
VOSB if no SDVOSB can satisfy the
need, using procedures other than full
and open competition when—
(1) Such concern is determined to be
a responsible source with respect to
performance of such contract
opportunity;
(2) The anticipated award price of the
contract (including options) will exceed
the simplified acquisition threshold, but
will not exceed $5 million; and
(3) Contract award can be made at a
fair and reasonable price that offers best
value to the United States. (38 U.S.C.
8127)
806.302–571 Authorized or required by
statute—VA unique authorities.
(a) Authority. (1) Citation: 41 U.S.C.
3304(a)(5). Contracting officers shall
also cite the specific authorities in
paragraph (b) of this section for the
statutes related to the products and
services procured.
(2) Full and open competition need
not be provided for when a statute
expressly authorizes or requires that the
acquisition be made through another
agency or from a specified source.
(b) Application. The following
products and services are authorized to
be acquired from a specified source:
(1) Prosthetic appliances and services.
Contracting activities may procure
prosthetic appliances and necessary
services required in the fitting,
supplying, and training and use of
prosthetic appliances by purchase,
manufacture, contract, or in such other
manner as determined to be proper,
without regard to any other provision of
law. (38 U.S.C. 8123)
(2) Commercial health-care resources,
the use of medical equipment or space,
or research, and acquired from an
institution affiliated with the
Department of Veterans Affairs.
Contracting activities may procure
health care resources, including
resources from medical practice groups
and other approved entities associated
with affiliated institutions, blood banks,
organ banks, or research centers from an
institution affiliated with VA in
accordance with 38 U.S.C. 7302.
Acquisition of resources from medical
practice groups and other entities shall
be approved when determined by the
contracting activity to be legally
associated with affiliated institutions in
accordance with 38 U.S.C. 7302. The
justification and approval requirements
of FAR 6.303 and paragraph (c) of this
section do not apply. (38 U.S.C.
8153(a)(3)(A))
(3) Commercial health-care resources,
the use of medical equipment or space,
and is not to be acquired from an entity
described in paragraph (b)(2) of this
section. Contracting activities may
procure health care resources from a
non-affiliated institution in accordance
with the simplified procedures
prescribed in part 873. The justification
and approval requirements of FAR 6.303
shall apply. (38 U.S.C. 8153(a)(3)(B))
(4) Commercial health-care resources,
the use of medical equipment or space,
when not acquired from an affiliated
institution described in paragraph (b)(2)
of this section and to be conducted on
a sole source basis. The authority in this
paragraph (b)(4) applies if not acquired
from an affiliated institution in
accordance with part 873. The
justification and approval requirements
of FAR 6.303 shall apply. (38 U.S.C.
8153(a)(3)(C)–(D))
(c) Written justifications and
approvals. Contracts awarded using an
authority in this section, with the
exception of acquisitions authorized
under paragraph (b)(2) of this section,
shall be supported by the written
justifications and approvals described in
FAR 6.303 and 6.304.
(d) Citation of specific authorities.
When a contracting officer enters into a
contract without providing full and
open competition for any of the
following items or services, the
contracting officer must cite 41 U.S.C.
3304(a)(5) and the following authorities
that apply, in the written justifications
and approvals as required by FAR 6.303
and 6.304:
(1) Contracts for scarce medical
specialist services. (Citation: 41 U.S.C.
3304(a)(5), as authorized by 38 U.S.C.
7409.) Contracting officers may enter
into contracts with:
(i) Schools and colleges of medicine,
osteopathy, dentistry, podiatry,
optometry, and nursing;
(ii) Clinics; and
(iii) Any other group or individual
capable of furnishing such scarce
medical specialist services at VA
facilities, to include the services of
physicians, dentists, podiatrists,
optometrists, chiropractors, nurses,
physician assistants, expanded-function
dental auxiliaries, technicians, and
other medical support personnel. (38
U.S.C. 7409)
(2) Contracts or agreements to
purchase or sell merchandise,
equipment, fixtures, supplies and
services for the operation of the
Veterans Canteen Service. (Citation: 41
U.S.C. 3304(a)(5), as authorized by 38
U.S.C. 7802(f).) Contracts or agreements
may be entered into without regard to
41 U.S.C. 6101(b) through (d).
(3) Contracts or leases for the
operation of parking facilities
established under authority of 38 U.S.C.
8109(b). (Citation: 41 U.S.C. 3304(a)(5),
as authorized by 38 U.S.C. 8109(f).)
Contracts or leases may be entered into
provided that the establishment,
operation, and maintenance of such
facilities have been authorized by the
Secretary or designee.
(4) Contracts for laundry and other
common services, such as the purchase
of steam, negotiated with non-profit,
tax-exempt educational, medical, or
community institutions. (Citation: 41
U.S.C. 3304(a)(5), as authorized by 38
U.S.C. 8122(c).) Contracts may be
entered into when specifically approved
by the Secretary or designee and when
such services are not reasonably
available from private commercial
sources.
(5) Contracts or agreements with
private or public agencies or persons for
translator services. (Citation: 41 U.S.C.
3304(a)(5), as authorized by 38 U.S.C.
513.)
Subpart 806.5—Advocates for
Competition
806.501 Requirement.
The Associate Executive Director,
Office of Procurement Policy, Systems
and Oversight (AED, PPSO) is
designated as the VA Advocate for
Competition for the agency. The AED,
PPSO may further delegate the authority
in this section to appoint an alternate
agency advocate for competition and
shall designate procuring activity
advocates for competition in accordance
with FAR 6.501. A complete list of VA
procuring activity advocates for
competition can be found at https://
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www.va.gov/oal/business/pps/
competition-advocates.asp.
[FR Doc. 2021–20926 Filed 9–29–21; 8:45 am]
BILLING CODE 8320–01–P
DEPARTMENT OF VETERANS
AFFAIRS
48 CFR Parts 852 and 873
RIN 2900–AQ78
VA Acquisition Regulation: Simplified
Procedures for Health-Care Resources
AGENCY
: Department of Veterans Affairs.
ACTION
: Final rule.
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
Regulation (FAR), to remove any
procedural guidance internal to VA into
the VA Acquisition Manual (VAAM),
and to incorporate any new agency
specific regulations or policies. This
rulemaking revises VAAR coverage
concerning Simplified Procedures for
Health-Care Resources as well as an
affected part concerning Solicitation
Provisions and Contract Clauses.
DATES
: This rule is effective on
November 1, 2021.
FOR FURTHER INFORMATION CONTACT
: Mr.
Rafael Taylor, Senior Procurement
Analyst, Procurement Policy and
Warrant Management Services, 003A2A,
425 I Street NW, Washington, DC 20001,
(202) 894–0686. (This is not a toll-free
number.)
SUPPLEMENTARY INFORMATION
: 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, will publish them in the
Federal Register.
On January 21,2021, VA published a
proposed rule in the Federal Register
(85 FR 35238) which announced VA’s
intent to amend regulations for VAAR
Case RIN 2900–AQ78—Simplified
Procedures for Health-Care Resources.
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 22, 2021, and VA
received comments from three
respondents. This rule adopts as a final
rule the proposed rule published in the
Federal Register on January 21, 2021,
with the exception of minor formatting
edits.
VA received three comments from the
public. Two commenters expressed
support for the rule—with one of the
respondents stating that the streamlined
procedures will help Veterans and the
other respondent expressing the opinion
that amending the VAAR by removing
outdated and superseded information
would allow for a more concise
understanding of the regulation. VA
appreciates this feedback. As a result of
these comments, no changes have been
made to the rule.
The third respondent commented on
the rules’ coverage at 873.104,
Competition requirements, permitting
VA to contract on a sole source basis
with affiliated institutions for
commercial health-care resources. In
particular, the respondent expressed
their view that a sole source justification
should be published and that
competitive proposals should be
considered.
VA appreciates the feedback. This
comment pertains to a specific statutory
exception provided by Congress for VA
to be able to contract with affiliated
institutions in accordance with 38
U.S.C. 7302, on a sole source basis as
provided by 38 U.S.C. 8153(a)(3)(A),
without publication of a justification for
health-care resources. VA policy
encourages competition where
appropriate. When sole source
acquisitions are necessary to meet
critical mission needs, justification and
approvals are publicized as required in
accordance with law and regulation.
However, as 38 U.S.C. 8153 expressly
provides this unique exception for VA’s
work with affiliated institutions to
provide Veteran’s critical healthcare, no
revisions will be made to the proposed
rule.
Executive Orders 12866 and 13563
Executive Orders (EOs) 12866 and
13563 direct agencies to assess all costs
and benefits of available regulatory
alternatives and, when regulation is
necessary, to select regulatory
approaches that maximize net benefits
(including potential economic,
environmental, public health and safety
effects, and other advantages;
distributive impacts, and equity).
Executive Order 13563 (Improving
Regulation and Regulatory Review)
emphasizes the importance of
quantifying both costs and benefits,
reducing costs, harmonizing rules, and
promoting flexibility. The Office of
Information and Regulatory Affairs has
determined that this rule is not a
significant regulatory action under
Executive Order 12866. The Regulatory
Impact Analysis associated with this
rulemaking can be found as a
supporting document at
www.regulations.gov.
Paperwork Reduction Act
This final rule contains no provisions
constituting a collection of information
under the Paperwork Reduction Act of
1995 (44 U.S.C. 3501–3521).
Regulatory Flexibility Act
The rule primarily affects the use of
authorities that VA contracting officers
are already authorized by statute to
utilize when required and in accordance
with existing agency regulation, policies
and procedures. This rule appropriately
clarifies and revises the use of such
authorities and when certain
justification and approval requirements
apply. The authorities were previously
codified in the VAAR either in this part
or in other parts, to include those
affecting small business programs, and
they affected both large and small
entities alike. With this rule, VA ensures
content to supplement the FAR for VA’s
unique service-disabled veteran-owned
small business and veteran-owned small
business program is properly
implemented in this part.
The overall impact of the rule is of
benefit to small businesses owned by
Veterans or service-disabled Veterans as
the VAAR is being updated to remove
extraneous procedural information that
applies only to VA’s internal operating
processes or procedures. This rule will
ensure clarity for both the public and
VA contracting officers to ensure that
when such authorities are utilized, they
are properly cited and, when required,
appropriately documented and
publicized. This rulemaking does not
change VA’s policy regarding small
businesses. VA estimates that no cost or
economic impact to individual
businesses will result from this rule
update. VA estimates this final rule is
not expected to result in increased or
decreased costs to small business
entities, and no more than de minimis
costs. On this basis, the final rule does
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.
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.
Unfunded Mandates
The Unfunded Mandates Reform Act
of 1995 requires, at 2 U.S.C. 1532, that
agencies prepare an assessment of
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