Federal Acquisition Regulation; Biobased Procurements, 23365-23368 [2012-9201]
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Federal Register / Vol. 77, No. 75 / Wednesday, April 18, 2012 / Rules and Regulations
DEPARTMENT OF DEFENSE
GENERAL SERVICES
ADMINISTRATION
NATIONAL AERONAUTICS AND
SPACE ADMINISTRATION
48 CFR Parts 1, 2, 11, 23, and 52
[FAC 2005–58; FAR Case 2010–004;
Item I; Docket 2010–0004, Sequence 2]
RIN 9000–AM03
Federal Acquisition Regulation;
Biobased Procurements
Department of Defense (DoD),
General Services Administration (GSA),
and National Aeronautics and Space
Administration (NASA).
ACTION: Final rule.
AGENCY:
DoD, GSA, and NASA are
issuing a final rule amending the
Federal Acquisition Regulation (FAR) to
implement changes due to the Farm
Security and Rural Investment Act that
require contractors to report the
biobased products purchased under
service and construction contracts. This
reporting will enable agencies to
monitor compliance with the Federal
preference for purchasing biobased
products.
DATES: Effective Date: May 18, 2012.
FOR FURTHER INFORMATION CONTACT: Mr.
William Clark, Procurement Analyst, at
202–219–1813, for clarification of
content. For information pertaining to
status or publication schedules, contact
the Regulatory Secretariat at 202–501–
4755. Please cite FAC 2005–58, FAR
Case 2010–004.
SUPPLEMENTARY INFORMATION:
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SUMMARY:
I. Background
DoD, GSA, and NASA published a
proposed rule in the Federal Register at
76 FR 41179 on July 13, 2011, to
implement section 9002 of the Farm
Security and Rural Investment Act of
2002, as amended by the Food,
Conservation, and Energy Act of 2008
(Pub. L. 110–246). These statutory
provisions are codified at 7 U.S.C. 8102.
This section of the United States Code
requires Federal agencies to establish a
procurement program, develop
procurement specifications, procure
biobased products, and give preference
to those items that are composed of the
highest percentage of biobased products
practicable or those products that
comply with the regulations issued
under section 103 of Public Law 100–
556 (42 U.S.C. 6914b–1). Title 7 U.S.C.
8102 provides Federal agencies the
flexibility not to procure biobased
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products if the product cannot be
acquired—
(a) Within a reasonable time frame
providing for compliance with the
contract performance schedule;
(b) Meeting reasonable performance
requirements; or
(c) At a reasonable price.
The Biobased Products Preference
Program was originally implemented in
FAR Case 2004–032, which was
published in the Federal Register at 72
FR 63040, November 7, 2007. This final
rule implements additional elements of
7 U.S.C. 8102 as amended by Public
Law 110–246. This final rule also meets
the direction in the Presidential
Memorandum, ‘‘Driving Innovation and
Creating Jobs in Rural America through
Biobased and Sustainable Product
Procurement,’’ dated February 21, 2012,
to amend the FAR to require reporting
of biobased product purchases. Two
respondents submitted 14 public
comments on the proposed rule.
II. Discussion and Analysis
The Civilian Agency Acquisition
Council and the Defense Acquisition
Regulations Council (the Councils)
reviewed the public comments in the
development of the final rule. A
discussion of the comments and the
changes made to the rule as a result of
those comments are provided as
follows:
A. Summary of Changes to the FAR
1. The definition of ‘‘biobased
product’’ is revised at FAR 2.101.
2. A prohibition against agencies
collecting more data than typically
would be provided by other entities
(other than data confirming the biobased
content) was added to FAR 11.302.
3. The clause at FAR 52.223–2,
Affirmative Procurement of Biobased
Products Under Service and
Construction Contracts, is amended to
require annual reporting by the
contractor of the types and dollar value
of any U.S. Department of Agriculture
(USDA)-designated biobased products
purchased during the preceding fiscal
year on the contract.
4. References to the USDA’s
BioPreferred Program are updated to
conform to the agency’s relocation of the
program’s rules in the Code of Federal
Regulations (see 76 FR 53631 dated
August 29, 2011).
5. USDA established a blanket
exemption for all USDA-designated
biobased items from the Biopreferred
Program’s requirements for
procurements involving combat or
combat-related missions and for
spacecraft systems and launch support
equipment (see 73 FR 27953 dated May
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23365
14, 2008). FAR 23.404(b)(2) and 52.223–
2(a)(2) are updated to conform to the
blanket exemption.
B. Positive Comments
Comments: Both respondents stated
their strong support for the proposed
rule. One respondent viewed it ‘‘as a
necessary action to implement existing
laws and policies for purchasing
biobased products by federal agencies
and contractors.’’
Response: Noted.
Comments: One respondent expressed
particular support for the provision in
the proposed rule directing contracting
officers to refer to the USDA list of
designated biobased items. Both
respondents agreed that the USDA list is
an important and growing reminder of
the availability of biobased products.
Response: Noted. However, the
preference for use of biobased products
that are USDA-designated items existed
at FAR 52.223–2(a) prior to the
proposed rule.
Comments: Both respondents
expressed support for the requirement
that contractors report annually on the
biobased products purchased and their
dollar value. One respondent stated that
such annual reports, by contractors and
agencies, will help measure the growth
and success of the program and ensure
agency and contractor compliance with
the law.
Response: Noted. Also see section C
below regarding reporting and section V
for a comment on the reporting burden
associated with this rule.
C. Definitions
Comment: One respondent noted that
neither ‘‘cognizant environmental
manager’’ nor ‘‘agency environmental
manager’’ was defined in the proposed
rule. The respondent suggested that
more clarity was needed, and the
‘‘person to whom the product type and
dollar value data are reported should be
someone who can ensure that the data
are properly collected and tabulated and
made available for reporting into the
Federal Procurement Data System or
other system that will allow each agency
to report the information to the Office of
Federal Procurement Policy, as
required.’’
Response: The clause at FAR 52.223–
2, Affirmative Procurement of Biobased
Products Under Service and
Construction Contracts, has been
revised at paragraphs (c) and (d) to
eliminate any reference to the
environmental manager and change the
reporting requirement to the
environmental point of contact, with a
copy of the report to be sent to the
contracting officer. Together, these
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revisions eliminate any need for
additional definitions in the FAR
coverage.
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D. Allow No Exceptions or Waivers
Comment: Strongly supporting the
program’s requirement that all Federal
agencies and contractors purchase
USDA-designated biobased products,
one respondent recommended that no
exemptions or waivers should be
allowed under any circumstances.
Response: Exemptions or waivers,
under certain circumstances, to the
acquisition of USDA-designated
biobased products are recognized by the
Farm Security and Rural Investment Act
of 2002, 7 U.S.C. 8102, and Executive
Order 13514, entitled ‘‘Federal
Leadership in Environmental, Energy,
and Economic Performance,’’ dated
October 5, 2009. These exemptions or
exceptions previously have been
implemented in the FAR.
E. Out-of-Scope Comments
Comments: One respondent presented
recommendations for the elements on
which the Office of Management and
Budget (OMB) should report annually in
order to ensure compliance. These
recommendations included mandatory
reporting elements for each agency,
department, and its contractors. The
respondent asserted that there should be
additional reporting required by DoD.
The second respondent noted that
section 9002(a)(4)(B) of the statute
provides specific annual reporting
requirements for the GSA and Defense
Logistics Agency and queried why those
agency reporting requirements were not
addressed in the proposed rule.
Response: The FAR addresses
requirements for contractors. OMB is
responsible for determining agency
reporting requirements. Therefore, these
comments are outside the scope of this
rule.
Comment: One respondent
recommended that, in order to ensure
full compliance, DoD should seek to
update 100 percent of its specifications
to include biobased products by
December 31, 2013.
Response: The internal review of
specifications by a particular agency is
outside the scope of this rule.
Comment: One respondent
recommended that a complete inventory
management system needed to be
created to track the biobased products
purchased by all Federal agencies. The
respondent stated that ‘‘(t)his scorecard
should contain information on agencies
and departments purchasing biobased
products and contracts.’’ According to
the respondent, codifying the biobased
products acquisition reporting structure
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in the FAR would lead to more market
pull.
Response: The FAR addresses
requirements for contractors. OMB is
responsible for determining agency
management and reporting
requirements. Therefore, this
recommendation is outside the scope of
this rule.
III. Executive Orders 12866 and 13563
Executive Orders (E.O.s) 12866 and
13563 direct agencies to assess all costs
and benefits of available regulatory
alternatives and, if regulation is
necessary, to select regulatory
approaches that maximize net benefits
(including potential economic,
environmental, public health and safety
effects, distributive impacts, and
equity). E.O. 13563 emphasizes the
importance of quantifying both costs
and benefits, of reducing costs, of
harmonizing rules, and of promoting
flexibility. This is a significant
regulatory action and, therefore, was
subject to review under section 6(b) of
E.O. 12866, Regulatory Planning and
Review, dated September 30, 1993. This
rule is not a major rule under 5 U.S.C.
804.
IV. Regulatory Flexibility Act
The Department of Defense, General
Services Administration, and National
Aeronautics and Space Administration
have prepared a Final Regulatory
Flexibility Analysis (FRFA) consistent
with the Regulatory Flexibility Act, 5
U.S.C. 601, et seq. The FRFA is
summarized as follows:
DoD, GSA, and NASA are amending the
Federal Acquisition Regulation (FAR) to
implement section 9002 of the Farm Security
and Rural Investment Act of 2002, codified
at 7 U.S.C. 8102, as amended by the Food,
Conservation, and Energy Act of 2008 (Pub.
L. 110–246).
Title 7 U.S.C. 8102 requires Federal
agencies to establish a procurement program,
develop procurement specifications, procure
biobased products, and give preference to
those items that are composed of the highest
percentage of biobased products practicable
or products that comply with the regulations
issued under section 103 of Public Law 100–
556 (42 U.S.C. 6914b–1).
This final rule modifies FAR 52.223–2,
Affirmative Procurement of Biobased
Products Under Service and Construction
Contracts, to require prime contractors to
report the product types and dollar value of
any USDA-designated biobased products
purchased during the preceding fiscal year.
The information reported by prime
contractors will enable Federal agencies to (a)
report annually to the Office of Federal
Procurement Policy (OFPP) information
concerning actions taken to implement the
preference for biobased products and (b)
assess compliance and measure progress in
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carrying out the preference for biobased
products. Further, OFPP must collect the
information reported by the agencies and
make it publicly available on an annual basis.
There were no public comments filed in
response to the Initial Regulatory Flexibility
Analysis.
The rule promotes the use of biobased
products and requires an annual report on
the product types and dollar value of any
U.S. Department of Agriculture (USDA)designated biobased products purchased by
the prime contractor during the previous
year. By averaging data from Fiscal Years
2009 and 2010 in the Federal Procurement
Data System (FPDS), we estimate that 48,376
contractors will be affected. Of those entities,
approximately 35,927 (70 percent) will be
small businesses. This estimate is based on
contract actions from the following selected
Product Services Codes (PSCs):
• A—Research and Development;
• F—Natural Resources Management;
• J—Maintenance, Repair, and Rebuilding
of Equipment;
• M—Operation of Government-Owned
Facility;
• S—Utilities and Housekeeping Services;
• T—Photographic, Mapping, Printing, and
Publication Services;
• Y—Construction of Structures and
Facilities; and
• Z—Maintenance, Repair or Alteration of
Real Property.
We believe the clause will apply to most
of the contract actions in the selected PSCs.
Based on the Fiscal Year 2009 FPDS data
collected, there were 55,174 unique Data
Universal Numbering System (DUNS)
numbers performing such contracts, and
40,741 of these were small businesses. Based
on the Fiscal Year 2010 FPDS data collected,
there were 41,578 unique DUNS numbers,
and 31,113 of these were small businesses.
Where information on the biobased nature
of products is not already available,
contractors may need to create an inventory
management system to track the product
types and dollar value of USDA-designated
biobased products purchased for each
contract. However, DoD, GSA, and NASA
expect that the impact will be minimal
because the existing clause already requires
contractors to make maximum use of
biobased products in the performance of
services and construction contracts, and the
change does not impose any substantial new
requirements other than the prime contractor
reports. Small businesses are active suppliers
of biobased products, and this rule may serve
to enhance their participation in this market.
The types of skills required to prepare the
report include data gathering, research,
quantitative, editing, and drafting. We
estimate the personnel required would be
equivalent to a Government employee at a
GS–11, step 5 salary.
There are no other reporting,
recordkeeping, or other compliance
requirements associated with this rule. There
is no impact, positive or negative, on small
businesses. Thus, there are no professional
skills necessary on the part of small
businesses. There are no direct costs to small
business firms to comply with this rule.
The rule does not duplicate, overlap, or
conflict with any other Federal rules. DoD,
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GSA, and NASA were not able to identify
any significant alternatives that would
accomplish the objectives of the statute.
Further, the impact of this rule on small
entities is expected to be generally positive.
Authority: 40 U.S.C. 121(c); 10 U.S.C.
chapter 137; and 42 U.S.C. 2473(c).
Interested parties may obtain a copy
of the FRFA from the Regulatory
Secretariat. The Regulatory Secretariat
has submitted a copy of the FRFA to the
Chief Counsel for Advocacy of the Small
Business Administration.
1.106
V. Paperwork Reduction Act
The Paperwork Reduction Act (44
U.S.C. chapter 35) applies. The rule
contains information collection
requirements. OMB has cleared this
information collection requirement
under OMB Control Number 9000–0180,
titled ‘‘Biobased Procurements.’’
One comment was received on the
paperwork burden associated with this
rule. It is summarized below.
Comment: The respondent believed
that the required reporting does not
have to be burdensome, because the
clause at FAR 52.223–2, Affirmative
Procurement of Biobased Products
Under Service and Construction
Contracts, already provides that the
contractor shall make maximum use of
USDA-designated biobased products
(with certain exceptions). The
respondent noted that, in order to
comply with this current requirement,
contractors should already be keeping
records. Adding the dollar value of
those items and reporting annually
should not add a significant burden,
according to the respondent. The
respondent suggested that agencies
should further simplify the reporting
burden by making available an
electronic template for the required
report.
Response: The FAR does not
designate practices to be used internally
by Government agencies. Although
providing an electronic reporting
template for use by contractors seems to
be a good idea, the FAR is not the
proper vehicle for its designation.
List of Subjects in 48 CFR Parts 1, 2, 11,
23, and 52
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Government procurement.
Dated: April 11, 2012.
Laura Auletta,
Director, Office of Governmentwide
Acquisition Policy, Office of Acquisition
Policy, Office of Governmentwide Policy.
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[Amended]
2. Amend section 1.106 in the table
following the introductory text, by
adding in sequence, FAR segment
‘‘52.223–2’’ and its corresponding OMB
Control Number ‘‘9000–0180’’.
■
PART 2—DEFINITIONS OF WORDS
AND TERMS
2.101
[Amended]
3. Amend section 2.101 in paragraph
(b)(2), in the definition ‘‘Biobased
product’’ by removing ‘‘(including
plant, animal, and marine materials) or’’
and adding ‘‘and’’ in its place.
■
procurement requirement for the
following:
*
*
*
*
*
■ 7. Amend section 23.405 by removing
from paragraph (a)(2) ‘‘https://
www.usda.gov/biopreferred’’ and adding
‘‘https://www.biopreferred.gov’’ in its
place; and adding paragraph (a)(3) to
read as follows:
23.405
Procedures.
(a) * * *
(3) When acquiring recovered material
or biobased products, the contracting
officer may request information or data
on such products, including recycled or
biobased content or related standards of
the products (see 11.302(c)).
*
*
*
*
*
23.406
[Amended]
8. Amend section 23.406 by removing
from paragraph (b) ‘‘contracts unless’’
and adding ‘‘contracts, unless’’ in its
place; and removing ‘‘https://
www.usda.gov/biopreferred or 7 CFR
Part 2902’’ and adding ‘‘https://
www.biopreferred.gov or 7 CFR part
3201’’ in its place.
■
PART 11—DESCRIBING AGENCY
NEEDS
4. Amend section 11.302 by revising
paragraph (c)(2) to read as follows:
■
11.302
Policy.
*
*
*
*
*
(c) * * *
(2) For biobased products, agencies
may not require, as a condition of
purchase of such products, the vendor
or manufacturer to provide more data
than would typically be provided by
other business entities offering products
for sale to the agency, other than data
confirming the biobased content of a
product (see 7 CFR 3201.8).
PART 23—ENVIRONMENT, ENERGY
AND WATER EFFICIENCY,
RENEWABLE ENERGY
TECHNOLOGIES, OCCUPATIONAL
SAFETY, AND DRUG-FREE
WORKPLACE
23.401
[Amended]
5. Amend section 23.401 by removing
from paragraph (b)(1) ‘‘part 2902’’ and
adding ‘‘part 3201’’ in its place.
■ 6. Amend section 23.404 by revising
the introductory text of paragraph (b)(2);
and removing from paragraph (e)(1)
‘‘(including plant, animal, and marine
materials)’’. The revised text reads as
follows:
■
23.404 Agency affirmative procurement
programs.
*
Therefore, DoD, GSA, and NASA
amend 48 CFR parts 1, 2, 11, 23, and 52
as set forth below:
■ 1. The authority citation for 48 CFR
parts 1, 2, 11, 23, and 52 continues to
read as follows:
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REGULATION SYSTEM
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*
*
*
*
(b) * * *
(2) EPA and USDA may provide
categorical exemptions for items that
they designate, when procured for a
specific purpose. For example, all
USDA-designated items (see 7 CFR
3201.3(e)) are exempt from the preferred
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PART 52—SOLICITATION PROVISIONS
AND CONTRACT CLAUSES
52.223–1
[Amended]
9. Amend section 52.223–1 by
removing ‘‘(Dec 2007)’’ and adding
‘‘(May 2012)’’ in its place; and removing
‘‘part 2902’’ and adding ‘‘part 3201’’ in
its place.
■
10. Amend section 52.223–2 by:
a. Revising the date of the clause;
b. Revising paragraph (a)(2)
introductory text; and
■ c. Adding paragraphs (c) and (d).
The revised and added text reads as
follows:
■
■
■
52.223–2 Affirmative Procurement of
Biobased Products Under Service and
Construction Contracts.
*
*
*
*
*
Affirmative Procurement of Biobased
Products Under Service and
Construction Contracts (May 2012)
*
*
*
*
*
(a) * * *
(2) The product is to be used in an
application covered by a USDA categorical
exemption (see 7 CFR 3201.3(e)). For
example, all USDA-designated items are
exempt from the preferred procurement
requirement for the following:
*
*
*
*
*
(c) In the performance of this contract, the
Contractor shall—
(1) Report to the environmental point of
contact identified in paragraph (d) of this
clause, with a copy to the Contracting
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Officer, on the product types and dollar value
of any USDA-designated biobased products
purchased by the Contractor during the
previous Government fiscal year, between
October 1 and September 30;
(2) Submit this report no later than—
(i) October 31 of each year during contract
performance; and
(ii) At the end of contract performance; and
(3) Contact the environmental point of
contract to obtain the preferred submittal
format, if that format is not specified in this
contract.
(d) The environmental point of contact for
this contract is: ________ [Contracting Officer
shall insert full name, phone number, and
email address. In addition, the Contracting
Officer may include the agency Web site for
reporting.]
*
*
*
*
*
[FR Doc. 2012–9201 Filed 4–17–12; 8:45 am]
BILLING CODE 6820–EP–P
DEPARTMENT OF DEFENSE
GENERAL SERVICES
ADMINISTRATION
NATIONAL AERONAUTICS AND
SPACE ADMINISTRATION
48 CFR Parts 4, 25, and 52
[FAC 2005–58; FAR Case 2010–018; Item
II; Docket 2010–0018, Sequence 1]
RIN 9000–AL91
Federal Acquisition Regulation;
Representation Regarding Export of
Sensitive Technology to Iran
Department of Defense (DoD),
General Services Administration (GSA),
and National Aeronautics and Space
Administration (NASA).
ACTION: Final rule.
AGENCY:
DoD, GSA, and NASA have
adopted as final, with changes, the
interim rule amending the Federal
Acquisition Regulation (FAR) to add a
representation to implement section 106
of the Comprehensive Iran Sanctions,
Accountability, and Divestment Act of
2010. Section 106 imposes a
procurement prohibition relating to
contracts with persons that export
certain sensitive technology to Iran.
DATES: Effective Date: May 18, 2012.
FOR FURTHER INFORMATION CONTACT:
Ms. Cecelia Davis, Procurement Analyst,
at 202–219–0202, for clarification of
content. For information pertaining to
status or publication schedules, contact
the Regulatory Secretariat at 202–501–
4755. Please cite FAC 2005–58, FAR
Case 2010–018.
SUPPLEMENTARY INFORMATION:
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SUMMARY:
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16:30 Apr 17, 2012
Jkt 226001
I. Background
DoD, GSA, and NASA published an
interim rule in the Federal Register at
76 FR 68028 on November 2, 2011, to
add a representation to implement
section 106 of the Comprehensive Iran
Sanctions, Accountability, and
Divestment Act of 2010. Section 106
imposes a procurement prohibition
relating to contracts with persons that
export certain sensitive technology to
Iran. One respondent submitted
comments on the interim rule.
II. Discussion and Analysis
The Civilian Agency Acquisition
Council and the Defense Acquisition
Regulations Council (the Councils)
reviewed the comment in the
development of the final rule. There
were no significant changes in the final
rule as a result of the one public
comment.
Comment: The respondent pointed
out that the introductory text at FAR
25.703–1, Definitions, should refer to
definitions used in the ‘‘section’’ rather
than ‘‘subpart.’’
Response: The correction has been
made.
III. Executive Orders 12866 and 13563
Executive Orders (E.O.s) 12866 and
13563 direct agencies to assess all costs
and benefits of available regulatory
alternatives and, if regulation is
necessary, to select regulatory
approaches that maximize net benefits
(including potential economic,
environmental, public health and safety
effects, distributive impacts, and
equity). E.O. 13563 emphasizes the
importance of quantifying both costs
and benefits, of reducing costs, of
harmonizing rules, and of promoting
flexibility. This is a significant
regulatory action and, therefore, was
subject to review under section 6(b) of
E.O. 12866, Regulatory Planning and
Review, dated September 30, 1993. This
rule is not a major rule under 5 U.S.C.
804.
IV. Regulatory Flexibility Act
The Department of Defense, the
General Services Administration, and
the National Aeronautics and Space
Administration certify that this final
rule will not have a significant
economic impact on a substantial
number of small entities within the
meaning of the Regulatory Flexibility
Act, 5 U.S.C. 601, et seq., because this
rule will only have an impact on an
offeror that is exporting sensitive
technology to Iran. Domestic entities are
generally prohibited from engaging in
activity that would cause them to be
subject to the procurement bans
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described in this rule due to current
restrictions on trade with Iran (see, e.g.,
Department of the Treasury Office of
Foreign Assets Control regulations at 31
CFR part 560).
For the definition of ‘‘small business,’’
the Regulatory Flexibility Act refers to
the Small Business Act, which in turn
allows the U.S. Small Business
Administration (SBA) Administrator to
specify detailed definitions or standards
(5 U.S.C. 601(3) and 15 U.S.C. 632(a)).
The SBA regulations at 13 CFR 121.105
discuss who is a small business:
‘‘(a)(1) Except for small agricultural
cooperatives, a business concern eligible
for assistance from SBA as a small
business is a business entity organized
for profit, with a place of business
located in the United States, and which
operates primarily within the United
States or which makes a significant
contribution to the U.S. economy
through payment of taxes or use of
American products, materials or labor.’’
V. Paperwork Reduction Act
The rule does not contain any
information collection requirements that
require the approval of the Office of
Management and Budget under the
Paperwork Reduction Act (44 U.S.C.
chapter 35).
List of Subjects in 48 CFR Parts 4, 25,
and 52
Government procurement.
Dated: April 11, 2012.
Laura Auletta,
Director, Office of Governmentwide
Acquisition Policy, Office of Acquisition
Policy, Office of Governmentwide Policy.
Interim Rule Adopted as Final With
Changes
Accordingly, the interim rule
amending 48 CFR parts 4, 25, and 52,
which was published in the Federal
Register at 76 FR 68028, November 2,
2011, is adopted as final with the
following changes:
■
PART 25—FOREIGN ACQUISITION
1. The authority citation for 48 CFR
part 25 continues to read as follows:
■
Authority: 40 U.S.C. 121(c); 10 U.S.C.
chapter 137; and 42 U.S.C. 2473(c).
2. Amend section 25.703–1 by
revising the introductory text to read as
follows:
■
25.703–1
Definitions.
As used in this section—
*
*
*
*
*
[FR Doc. 2012–9202 Filed 4–17–12; 8:45 am]
BILLING CODE 6820–EP–P
E:\FR\FM\18APR2.SGM
18APR2
]]>Agencies
[Federal Register Volume 77, Number 75 (Wednesday, April 18, 2012)]
[Rules and Regulations]
[Pages 23365-23368]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2012-9201]
[[Page 23365]]
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DEPARTMENT OF DEFENSE
GENERAL SERVICES ADMINISTRATION
NATIONAL AERONAUTICS AND SPACE ADMINISTRATION
48 CFR Parts 1, 2, 11, 23, and 52
[FAC 2005-58; FAR Case 2010-004; Item I; Docket 2010-0004, Sequence 2]
RIN 9000-AM03
Federal Acquisition Regulation; Biobased Procurements
AGENCY: Department of Defense (DoD), General Services Administration
(GSA), and National Aeronautics and Space Administration (NASA).
ACTION: Final rule.
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SUMMARY: DoD, GSA, and NASA are issuing a final rule amending the
Federal Acquisition Regulation (FAR) to implement changes due to the
Farm Security and Rural Investment Act that require contractors to
report the biobased products purchased under service and construction
contracts. This reporting will enable agencies to monitor compliance
with the Federal preference for purchasing biobased products.
DATES: Effective Date: May 18, 2012.
FOR FURTHER INFORMATION CONTACT: Mr. William Clark, Procurement
Analyst, at 202-219-1813, for clarification of content. For information
pertaining to status or publication schedules, contact the Regulatory
Secretariat at 202-501-4755. Please cite FAC 2005-58, FAR Case 2010-
004.
SUPPLEMENTARY INFORMATION:
I. Background
DoD, GSA, and NASA published a proposed rule in the Federal
Register at 76 FR 41179 on July 13, 2011, to implement section 9002 of
the Farm Security and Rural Investment Act of 2002, as amended by the
Food, Conservation, and Energy Act of 2008 (Pub. L. 110-246). These
statutory provisions are codified at 7 U.S.C. 8102. This section of the
United States Code requires Federal agencies to establish a procurement
program, develop procurement specifications, procure biobased products,
and give preference to those items that are composed of the highest
percentage of biobased products practicable or those products that
comply with the regulations issued under section 103 of Public Law 100-
556 (42 U.S.C. 6914b-1). Title 7 U.S.C. 8102 provides Federal agencies
the flexibility not to procure biobased products if the product cannot
be acquired--
(a) Within a reasonable time frame providing for compliance with
the contract performance schedule;
(b) Meeting reasonable performance requirements; or
(c) At a reasonable price.
The Biobased Products Preference Program was originally implemented
in FAR Case 2004-032, which was published in the Federal Register at 72
FR 63040, November 7, 2007. This final rule implements additional
elements of 7 U.S.C. 8102 as amended by Public Law 110-246. This final
rule also meets the direction in the Presidential Memorandum, ``Driving
Innovation and Creating Jobs in Rural America through Biobased and
Sustainable Product Procurement,'' dated February 21, 2012, to amend
the FAR to require reporting of biobased product purchases. Two
respondents submitted 14 public comments on the proposed rule.
II. Discussion and Analysis
The Civilian Agency Acquisition Council and the Defense Acquisition
Regulations Council (the Councils) reviewed the public comments in the
development of the final rule. A discussion of the comments and the
changes made to the rule as a result of those comments are provided as
follows:
A. Summary of Changes to the FAR
1. The definition of ``biobased product'' is revised at FAR 2.101.
2. A prohibition against agencies collecting more data than
typically would be provided by other entities (other than data
confirming the biobased content) was added to FAR 11.302.
3. The clause at FAR 52.223-2, Affirmative Procurement of Biobased
Products Under Service and Construction Contracts, is amended to
require annual reporting by the contractor of the types and dollar
value of any U.S. Department of Agriculture (USDA)-designated biobased
products purchased during the preceding fiscal year on the contract.
4. References to the USDA's BioPreferred Program are updated to
conform to the agency's relocation of the program's rules in the Code
of Federal Regulations (see 76 FR 53631 dated August 29, 2011).
5. USDA established a blanket exemption for all USDA-designated
biobased items from the Biopreferred Program's requirements for
procurements involving combat or combat-related missions and for
spacecraft systems and launch support equipment (see 73 FR 27953 dated
May 14, 2008). FAR 23.404(b)(2) and 52.223-2(a)(2) are updated to
conform to the blanket exemption.
B. Positive Comments
Comments: Both respondents stated their strong support for the
proposed rule. One respondent viewed it ``as a necessary action to
implement existing laws and policies for purchasing biobased products
by federal agencies and contractors.''
Response: Noted.
Comments: One respondent expressed particular support for the
provision in the proposed rule directing contracting officers to refer
to the USDA list of designated biobased items. Both respondents agreed
that the USDA list is an important and growing reminder of the
availability of biobased products.
Response: Noted. However, the preference for use of biobased
products that are USDA-designated items existed at FAR 52.223-2(a)
prior to the proposed rule.
Comments: Both respondents expressed support for the requirement
that contractors report annually on the biobased products purchased and
their dollar value. One respondent stated that such annual reports, by
contractors and agencies, will help measure the growth and success of
the program and ensure agency and contractor compliance with the law.
Response: Noted. Also see section C below regarding reporting and
section V for a comment on the reporting burden associated with this
rule.
C. Definitions
Comment: One respondent noted that neither ``cognizant
environmental manager'' nor ``agency environmental manager'' was
defined in the proposed rule. The respondent suggested that more
clarity was needed, and the ``person to whom the product type and
dollar value data are reported should be someone who can ensure that
the data are properly collected and tabulated and made available for
reporting into the Federal Procurement Data System or other system that
will allow each agency to report the information to the Office of
Federal Procurement Policy, as required.''
Response: The clause at FAR 52.223-2, Affirmative Procurement of
Biobased Products Under Service and Construction Contracts, has been
revised at paragraphs (c) and (d) to eliminate any reference to the
environmental manager and change the reporting requirement to the
environmental point of contact, with a copy of the report to be sent to
the contracting officer. Together, these
[[Page 23366]]
revisions eliminate any need for additional definitions in the FAR
coverage.
D. Allow No Exceptions or Waivers
Comment: Strongly supporting the program's requirement that all
Federal agencies and contractors purchase USDA-designated biobased
products, one respondent recommended that no exemptions or waivers
should be allowed under any circumstances.
Response: Exemptions or waivers, under certain circumstances, to
the acquisition of USDA-designated biobased products are recognized by
the Farm Security and Rural Investment Act of 2002, 7 U.S.C. 8102, and
Executive Order 13514, entitled ``Federal Leadership in Environmental,
Energy, and Economic Performance,'' dated October 5, 2009. These
exemptions or exceptions previously have been implemented in the FAR.
E. Out-of-Scope Comments
Comments: One respondent presented recommendations for the elements
on which the Office of Management and Budget (OMB) should report
annually in order to ensure compliance. These recommendations included
mandatory reporting elements for each agency, department, and its
contractors. The respondent asserted that there should be additional
reporting required by DoD. The second respondent noted that section
9002(a)(4)(B) of the statute provides specific annual reporting
requirements for the GSA and Defense Logistics Agency and queried why
those agency reporting requirements were not addressed in the proposed
rule.
Response: The FAR addresses requirements for contractors. OMB is
responsible for determining agency reporting requirements. Therefore,
these comments are outside the scope of this rule.
Comment: One respondent recommended that, in order to ensure full
compliance, DoD should seek to update 100 percent of its specifications
to include biobased products by December 31, 2013.
Response: The internal review of specifications by a particular
agency is outside the scope of this rule.
Comment: One respondent recommended that a complete inventory
management system needed to be created to track the biobased products
purchased by all Federal agencies. The respondent stated that ``(t)his
scorecard should contain information on agencies and departments
purchasing biobased products and contracts.'' According to the
respondent, codifying the biobased products acquisition reporting
structure in the FAR would lead to more market pull.
Response: The FAR addresses requirements for contractors. OMB is
responsible for determining agency management and reporting
requirements. Therefore, this recommendation is outside the scope of
this rule.
III. Executive Orders 12866 and 13563
Executive Orders (E.O.s) 12866 and 13563 direct agencies to assess
all costs and benefits of available regulatory alternatives and, if
regulation is necessary, to select regulatory approaches that maximize
net benefits (including potential economic, environmental, public
health and safety effects, distributive impacts, and equity). E.O.
13563 emphasizes the importance of quantifying both costs and benefits,
of reducing costs, of harmonizing rules, and of promoting flexibility.
This is a significant regulatory action and, therefore, was subject to
review under section 6(b) of E.O. 12866, Regulatory Planning and
Review, dated September 30, 1993. This rule is not a major rule under 5
U.S.C. 804.
IV. Regulatory Flexibility Act
The Department of Defense, General Services Administration, and
National Aeronautics and Space Administration have prepared a Final
Regulatory Flexibility Analysis (FRFA) consistent with the Regulatory
Flexibility Act, 5 U.S.C. 601, et seq. The FRFA is summarized as
follows:
DoD, GSA, and NASA are amending the Federal Acquisition
Regulation (FAR) to implement section 9002 of the Farm Security and
Rural Investment Act of 2002, codified at 7 U.S.C. 8102, as amended
by the Food, Conservation, and Energy Act of 2008 (Pub. L. 110-246).
Title 7 U.S.C. 8102 requires Federal agencies to establish a
procurement program, develop procurement specifications, procure
biobased products, and give preference to those items that are
composed of the highest percentage of biobased products practicable
or products that comply with the regulations issued under section
103 of Public Law 100-556 (42 U.S.C. 6914b-1).
This final rule modifies FAR 52.223-2, Affirmative Procurement
of Biobased Products Under Service and Construction Contracts, to
require prime contractors to report the product types and dollar
value of any USDA-designated biobased products purchased during the
preceding fiscal year. The information reported by prime contractors
will enable Federal agencies to (a) report annually to the Office of
Federal Procurement Policy (OFPP) information concerning actions
taken to implement the preference for biobased products and (b)
assess compliance and measure progress in carrying out the
preference for biobased products. Further, OFPP must collect the
information reported by the agencies and make it publicly available
on an annual basis.
There were no public comments filed in response to the Initial
Regulatory Flexibility Analysis.
The rule promotes the use of biobased products and requires an
annual report on the product types and dollar value of any U.S.
Department of Agriculture (USDA)-designated biobased products
purchased by the prime contractor during the previous year. By
averaging data from Fiscal Years 2009 and 2010 in the Federal
Procurement Data System (FPDS), we estimate that 48,376 contractors
will be affected. Of those entities, approximately 35,927 (70
percent) will be small businesses. This estimate is based on
contract actions from the following selected Product Services Codes
(PSCs):
A--Research and Development;
F--Natural Resources Management;
J--Maintenance, Repair, and Rebuilding of Equipment;
M--Operation of Government-Owned Facility;
S--Utilities and Housekeeping Services;
T--Photographic, Mapping, Printing, and Publication
Services;
Y--Construction of Structures and Facilities; and
Z--Maintenance, Repair or Alteration of Real Property.
We believe the clause will apply to most of the contract actions
in the selected PSCs. Based on the Fiscal Year 2009 FPDS data
collected, there were 55,174 unique Data Universal Numbering System
(DUNS) numbers performing such contracts, and 40,741 of these were
small businesses. Based on the Fiscal Year 2010 FPDS data collected,
there were 41,578 unique DUNS numbers, and 31,113 of these were
small businesses.
Where information on the biobased nature of products is not
already available, contractors may need to create an inventory
management system to track the product types and dollar value of
USDA-designated biobased products purchased for each contract.
However, DoD, GSA, and NASA expect that the impact will be minimal
because the existing clause already requires contractors to make
maximum use of biobased products in the performance of services and
construction contracts, and the change does not impose any
substantial new requirements other than the prime contractor
reports. Small businesses are active suppliers of biobased products,
and this rule may serve to enhance their participation in this
market.
The types of skills required to prepare the report include data
gathering, research, quantitative, editing, and drafting. We
estimate the personnel required would be equivalent to a Government
employee at a GS-11, step 5 salary.
There are no other reporting, recordkeeping, or other compliance
requirements associated with this rule. There is no impact, positive
or negative, on small businesses. Thus, there are no professional
skills necessary on the part of small businesses. There are no
direct costs to small business firms to comply with this rule.
The rule does not duplicate, overlap, or conflict with any other
Federal rules. DoD,
[[Page 23367]]
GSA, and NASA were not able to identify any significant alternatives
that would accomplish the objectives of the statute. Further, the
impact of this rule on small entities is expected to be generally
positive.
Interested parties may obtain a copy of the FRFA from the
Regulatory Secretariat. The Regulatory Secretariat has submitted a copy
of the FRFA to the Chief Counsel for Advocacy of the Small Business
Administration.
V. Paperwork Reduction Act
The Paperwork Reduction Act (44 U.S.C. chapter 35) applies. The
rule contains information collection requirements. OMB has cleared this
information collection requirement under OMB Control Number 9000-0180,
titled ``Biobased Procurements.''
One comment was received on the paperwork burden associated with
this rule. It is summarized below.
Comment: The respondent believed that the required reporting does
not have to be burdensome, because the clause at FAR 52.223-2,
Affirmative Procurement of Biobased Products Under Service and
Construction Contracts, already provides that the contractor shall make
maximum use of USDA-designated biobased products (with certain
exceptions). The respondent noted that, in order to comply with this
current requirement, contractors should already be keeping records.
Adding the dollar value of those items and reporting annually should
not add a significant burden, according to the respondent. The
respondent suggested that agencies should further simplify the
reporting burden by making available an electronic template for the
required report.
Response: The FAR does not designate practices to be used
internally by Government agencies. Although providing an electronic
reporting template for use by contractors seems to be a good idea, the
FAR is not the proper vehicle for its designation.
List of Subjects in 48 CFR Parts 1, 2, 11, 23, and 52
Government procurement.
Dated: April 11, 2012.
Laura Auletta,
Director, Office of Governmentwide Acquisition Policy, Office of
Acquisition Policy, Office of Governmentwide Policy.
Therefore, DoD, GSA, and NASA amend 48 CFR parts 1, 2, 11, 23, and
52 as set forth below:
0
1. The authority citation for 48 CFR parts 1, 2, 11, 23, and 52
continues to read as follows:
Authority: 40 U.S.C. 121(c); 10 U.S.C. chapter 137; and 42
U.S.C. 2473(c).
PART 1--FEDERAL ACQUISTION REGULATION SYSTEM
1.106 [Amended]
0
2. Amend section 1.106 in the table following the introductory text, by
adding in sequence, FAR segment ``52.223-2'' and its corresponding OMB
Control Number ``9000-0180''.
PART 2--DEFINITIONS OF WORDS AND TERMS
2.101 [Amended]
0
3. Amend section 2.101 in paragraph (b)(2), in the definition
``Biobased product'' by removing ``(including plant, animal, and marine
materials) or'' and adding ``and'' in its place.
PART 11--DESCRIBING AGENCY NEEDS
0
4. Amend section 11.302 by revising paragraph (c)(2) to read as
follows:
11.302 Policy.
* * * * *
(c) * * *
(2) For biobased products, agencies may not require, as a condition
of purchase of such products, the vendor or manufacturer to provide
more data than would typically be provided by other business entities
offering products for sale to the agency, other than data confirming
the biobased content of a product (see 7 CFR 3201.8).
PART 23--ENVIRONMENT, ENERGY AND WATER EFFICIENCY, RENEWABLE ENERGY
TECHNOLOGIES, OCCUPATIONAL SAFETY, AND DRUG-FREE WORKPLACE
23.401 [Amended]
0
5. Amend section 23.401 by removing from paragraph (b)(1) ``part 2902''
and adding ``part 3201'' in its place.
0
6. Amend section 23.404 by revising the introductory text of paragraph
(b)(2); and removing from paragraph (e)(1) ``(including plant, animal,
and marine materials)''. The revised text reads as follows:
23.404 Agency affirmative procurement programs.
* * * * *
(b) * * *
(2) EPA and USDA may provide categorical exemptions for items that
they designate, when procured for a specific purpose. For example, all
USDA-designated items (see 7 CFR 3201.3(e)) are exempt from the
preferred procurement requirement for the following:
* * * * *
0
7. Amend section 23.405 by removing from paragraph (a)(2) ``https://www.usda.gov/biopreferred'' and adding ``https://www.biopreferred.gov''
in its place; and adding paragraph (a)(3) to read as follows:
23.405 Procedures.
(a) * * *
(3) When acquiring recovered material or biobased products, the
contracting officer may request information or data on such products,
including recycled or biobased content or related standards of the
products (see 11.302(c)).
* * * * *
23.406 [Amended]
0
8. Amend section 23.406 by removing from paragraph (b) ``contracts
unless'' and adding ``contracts, unless'' in its place; and removing
``https://www.usda.gov/biopreferred or 7 CFR Part 2902'' and adding
``https://www.biopreferred.gov or 7 CFR part 3201'' in its place.
PART 52--SOLICITATION PROVISIONS AND CONTRACT CLAUSES
52.223-1 [Amended]
0
9. Amend section 52.223-1 by removing ``(Dec 2007)'' and adding ``(May
2012)'' in its place; and removing ``part 2902'' and adding ``part
3201'' in its place.
0
10. Amend section 52.223-2 by:
0
a. Revising the date of the clause;
0
b. Revising paragraph (a)(2) introductory text; and
0
c. Adding paragraphs (c) and (d).
The revised and added text reads as follows:
52.223-2 Affirmative Procurement of Biobased Products Under Service
and Construction Contracts.
* * * * *
Affirmative Procurement of Biobased Products Under Service and
Construction Contracts (May 2012)
* * * * *
(a) * * *
(2) The product is to be used in an application covered by a
USDA categorical exemption (see 7 CFR 3201.3(e)). For example, all
USDA-designated items are exempt from the preferred procurement
requirement for the following:
* * * * *
(c) In the performance of this contract, the Contractor shall--
(1) Report to the environmental point of contact identified in
paragraph (d) of this clause, with a copy to the Contracting
[[Page 23368]]
Officer, on the product types and dollar value of any USDA-
designated biobased products purchased by the Contractor during the
previous Government fiscal year, between October 1 and September 30;
(2) Submit this report no later than--
(i) October 31 of each year during contract performance; and
(ii) At the end of contract performance; and
(3) Contact the environmental point of contract to obtain the
preferred submittal format, if that format is not specified in this
contract.
(d) The environmental point of contact for this contract is: --
-------------- [Contracting Officer shall insert full name, phone
number, and email address. In addition, the Contracting Officer may
include the agency Web site for reporting.]
* * * * *
[FR Doc. 2012-9201 Filed 4-17-12; 8:45 am]
BILLING CODE 6820-EP-P
