Environmental Protection Agency Acquisition Regulation; Improper Business Practices and Personal Conflicts of Interest, Solicitation Provisions and Contract Clauses, 31177-31180 [2016-11509]

Agencies

• ENVIRONMENTAL PROTECTION AGENCY

[Federal Register Volume 81, Number 96 (Wednesday, May 18, 2016)]
[Rules and Regulations]
[Pages 31177-31180]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2016-11509]



[[Page 31177]]

=======================================================================
-----------------------------------------------------------------------

ENVIRONMENTAL PROTECTION AGENCY

48 CFR Parts 1503 and 1552

[EPA-HQ-OARM-2015-0662; FRL 9943-61-OARM]


Environmental Protection Agency Acquisition Regulation; Improper 
Business Practices and Personal Conflicts of Interest, Solicitation 
Provisions and Contract Clauses

AGENCY: Environmental Protection Agency (EPA).

ACTION: Direct final rule.

-----------------------------------------------------------------------

SUMMARY: The Environmental Protection Agency (EPA) is issuing a final 
rule to make administrative changes to the Environmental Protection 
Agency Acquisition Regulation (EPAAR). EPA does not anticipate any 
adverse comments.

DATES: This rule is effective on July 18, 2016 without further action, 
unless EPA receives adverse comment by June 17, 2016. If EPA receives 
adverse comment, a timely withdrawal will be published in the Federal 
Register informing the public that the rule will not take effect.

ADDRESSES: Submit your comments, identified by Docket ID No. EPA-HQ-
OARM-2015-0662, at https://www.regulations.gov. Follow the online 
instructions for submitting comments. Once submitted, comments cannot 
be edited or removed from Regulations.gov. The EPA may publish any 
comment received to its public docket. Do not submit electronically any 
information you consider to be Confidential Business Information (CBI) 
or other information whose disclosure is restricted by statute. 
Multimedia submissions (audio, video, etc.) must be accompanied by a 
written comment. The written comment is considered the official comment 
and should include discussion of all points you wish to make. The EPA 
will generally not consider comments or comment contents located 
outside of the primary submission (i.e. on the web, cloud, or other 
file sharing system). For additional submission methods, the full EPA 
public comment policy, information about CBI or multimedia submissions, 
and general guidance on making effective comments, please visit https://www2.epa.gov/dockets/commenting-epa-dockets.

FOR FURTHER INFORMATION CONTACT: Julianne Odend'hal, Policy, Training, 
and Oversight Division, Acquisition Policy and Training Service Center 
(3802R), Environmental Protection Agency, 1200 Pennsylvania Avenue NW., 
Washington, DC 20460; telephone number: (202) 564-5218; email address: 
odend'hal.julianne@epa.gov.

SUPPLEMENTARY INFORMATION: 

I. Why is EPA using a direct final rule?

    EPA is publishing this rule without a prior proposed rule because 
EPA views this as a noncontroversial action and anticipates no adverse 
comment. EPAAR parts 1503 and 1552 are amended to conform to the format 
of the Federal Acquisition Regulation (FAR) and to correct, clarify and 
update information. If EPA receives adverse comment, a timely 
withdrawal will be published in the Federal Register informing the 
public that the rule will not take effect. Any parties interested in 
commenting must do so at this time.

II. Does this action apply to me?

    The EPAAR applies to contractors who have a contract with the EPA.

III. What should I consider as I prepare my comments for EPA?

    A. Submitting CBI. Do not submit this information to EPA through 
https://www.regulations.gov or email. Clearly mark the part or all of 
the information that you claim to be CBI. For CBI information in a disk 
or CD-ROM that you mail to EPA, mark the outside of the disk or CD-ROM 
as CBI, and then identify electronically within the disk or CD-ROM the 
specific information that is claimed as CBI. In addition to one 
complete version of the comment that includes information claimed as 
CBI, a copy of the comment that does not contain the information 
claimed as CBI must be submitted for inclusion in the public docket. 
Information so marked will not be disclosed except in accordance with 
procedures set forth in 40 CFR part 2.
    B. Tips for Preparing Your Comments. When submitting comments, 
remember to:
     Identify the rulemaking by docket number and other 
identifying information (subject heading, Federal Register date and 
page number).
     Follow directions--The agency may ask you to respond to 
specific questions or organize comments by referencing a Code of 
Federal Regulations (CFR) part or section number.
     Explain why you agree or disagree, suggest alternatives, 
and substitute language for your requested changes.
     Describe any assumptions and provide any technical 
information and/or data that you used.
     If you estimate potential costs or burdens, explain how 
you arrived at your estimate in sufficient detail to allow for it to be 
reproduced.
     Provide specific examples to illustrate your concerns, and 
suggest alternatives.
     Explain your views as clearly as possible, avoiding the 
use of profanity or personal threats.
     Make sure to submit your comments by the comment period 
deadline identified.

IV. Background

    EPAAR parts 1503 and 1552 are amended to conform to the format of 
the Federal Acquisition Regulation (FAR) and to correct, clarify and 
update information.

V. Final Rule

    This direct final rule makes the following changes: (1) Updates the 
title and clarifies the information in section 1503.101-370 including 
correcting statute citations; (2) corrects section number ``1503.104-
5'' to read ``1503.104-4'' and corrects the reference to ``FAR 3.104-
5'' to read ``FAR 3.104-4''; (3) removes section 1503.408, Evaluation 
of the SF 119, because the form no longer exists; (4) updates the 
subpart number and title of ``1503.5'' including ``1503.500-70'', 
``1503.500-71'' and ``1503.500-72'' to read ``1503.10 Contractor Code 
of Business Ethics and Conduct'', ``1503.1002 Policy'', ``1503.1003 
Requirements'', and ``1503.1004 Contract clause'' to conform to the 
FAR, updates the reference to ``EPAAR 1503.500-71(b)'' to read ``EPAAR 
1503.1003(b)''; (5) replaces the term ``regular employee'' with 
``employee'' which is defined at 5 U.S.C. 2505, and replaces the term 
``special employee'' with ``special government employee'' which is 
defined at 18 U.S.C. 202 in sections 1503.600-71, 1503.601, and 
1552.203-70; and (6) updates the EPA OIG contact information in section 
1552.203-71.

VI. Statutory and Executive Order Reviews

A. Executive Order 12866: Regulatory Planning and Review and Executive 
Order 13563: Improving Regulation and Regulatory Review

    This action is not a significant regulatory action and was 
therefore not submitted to the Office of Management and Budget (OMB) 
for review.

B. Paperwork Reduction Act

    This action does not impose an information collection burden under 
the PRA because it does not contain any information collection 
activities.

[[Page 31178]]

C. Regulatory Flexibility Act (RFA), as Amended by the Small Business 
Regulatory Enforcement Fairness Act of 1996 (SBREFA), 5 U.S.C. 601 et 
seq.

    I certify that this action will not have a significant economic 
impact on a substantial number of small entities under the RFA. In 
making this determination, the impact of concern is any significant 
adverse economic impact on small entities. An agency may certify that a 
rule will not have a significant economic impact on a substantial 
number of small entities if the rule relieves regulatory burden, has no 
net burden or otherwise has a positive economic effect on the small 
entities subject to the rule. This action amends EPAAR parts 1503 and 
1552 to conform to the format of the Federal Acquisition Regulation 
(FAR) and to correct, clarify and update information. We have therefore 
concluded that this action will have no net regulatory burden for all 
directly regulated small entities.

D. Unfunded Mandates Reform Act

    This action does not contain an unfunded mandate of $100 million or 
more as described in UMRA, 2 U.S.C. 1531-1538, and does not 
significantly or uniquely affect small governments. The action imposes 
no enforceable duty on any state, local or tribal governments or the 
private sector.

E. Executive Order 13132: Federalism

    This action does not have federalism implications. It will not have 
substantial direct effects on the states, on the relationship between 
the national government and the states, or on the distribution of power 
and responsibilities among the various levels of government.

F. Executive Order 13175: Consultation and Coordination With Indian 
Tribal Governments

    This action does not have tribal implications, as specified in 
Executive Order 13175 (65 FR 67249, November 9, 2000). Thus, Executive 
Order 13175 does not apply to this action. In the spirit of Executive 
Order 13175, and consistent with EPA policy to promote communication 
between EPA and Tribal governments, EPA specifically solicits 
additional comment on this proposed rule from Tribal officials.

G. Executive Order 13045: Protection of Children From Environmental 
Health Risks and Safety Risks

    EPA interprets Executive Order 13045 (62 FR 19885, April 23, 1997) 
as applying only to those regulatory actions that concern health or 
safety risks, such that the analysis required under section 5-501 of 
the Executive Order has the potential to influence the regulation. This 
action is not subject to Executive Order 13045 because it does not 
establish an environmental standard intended to mitigate health or 
safety risks.

H. Executive Order 13211: Actions Concerning Regulations That 
Significantly Affect Energy Supply, Distribution, or Use

    This action is not subject to Executive Order 13211 (66 FR 28355 
(May 22, 2001)), because it is not a significant regulatory action 
under Executive Order 12866.

I. National Technology Transfer and Advancement Act of 1995

    This rulemaking does not involve technical standards.

J. Executive Order 12898: Federal Actions To Address Environmental 
Justice in Minority Populations and Low-Income Populations

    Executive Order 12898 (59 FR 7629, (February 16, 1994)) establishes 
federal executive policy on environmental justice. Its main provision 
directs federal agencies, to the greatest extent practicable and 
permitted by law, to make environmental justice part of their mission 
by identifying and addressing, as appropriate, disproportionately high 
and adverse human health or environmental effects of their programs, 
policies, and activities on minority populations and low-income 
populations in the United States. EPA has determined that this final 
rule will not have disproportionately high and adverse human health or 
environmental effects on minority or low-income populations because it 
does not affect the level of protection provided to human health or the 
environment.

K. Congressional Review

    The Congressional Review Act, 5 U.S.C. 801 et seq., as added by the 
Small Business Regulatory Enforcement Fairness Act of 1996, generally 
provides that before a rule may take effect, the agency promulgating 
the rule must submit a rule report, which includes a copy of the rule, 
to each House of the Congress and to the Comptroller General of the 
United States. Section 804 exempts from section 801 the following types 
of rules (1) rules of particular applicability; (2) rules relating to 
agency management or personnel; and (3) rules of agency organization, 
procedure, or practice that do not substantially affect the rights or 
obligations of non-agency parties. 5 U.S.C. 804(3). EPA is not required 
to submit a rule report regarding this action under section 801 because 
this is a rule of agency organization, procedure, or practice that does 
not substantially affect the rights or obligations of non-agency 
parties.

List of Subjects in 48 CFR Parts 1503 and 1552

    Government procurement.

    Dated: May 2, 2016.
John R. Bashista,
Director, Office of Acquisition Management.

    For the reasons stated in the preamble, 48 CFR parts 1503 and 1552 
are amended as set forth below:

0
1. Revise part 1503 to read as follows:

PART 1503--IMPROPER BUSINESS PRACTICES AND PERSONAL CONFLICTS OF 
INTEREST

Sec.
1503.000 Scope of part.
Subpart 1503.1 Safeguards
1503.101-370 Financial conflicts of interest and loss of 
impartiality.
1503.104-4 Disclosure, protection, and marking of contractor bid or 
proposal information and source selection information.
Subpart 1503.6 Contracts With Government Employees or Organizations 
Owned or Controlled by Them
1503.600-70 Scope of subpart.
1503.600-71 Definitions.
1503.601 Policy.
1503.602 Exceptions.
1503.670 Disclosure provision.
Subpart 1503.9 Whistleblower Protections for Contractor Employees
1503.905 Procedures for investigating complaints.
Subpart 1503.10 Contractor Code of Business Ethics and Conduct
1503.1002 Policy.
1503.1003 Requirements.
1503.1004 Contract clause.

    Authority: 5 U.S.C. 301 and 41 U.S.C. 418b.


1503.000  Scope of part.

    This part implements FAR part 3, cites EPA regulations on employee 
responsibilities and conduct, establishes responsibility for reporting 
violations and related actions, and provides for authorization of 
exceptions to policy.

Subpart 1503.1--Safeguards


1503.101-370  Financial conflicts of interest and loss of impartiality.

    (a) Each EPA employee (including special government employees as 
defined by 18 U.S.C. 202 and 1503.600-71(b)) engaged in source 
evaluation and selection is required to abide by and be

[[Page 31179]]

familiar with the conflict of interest statutes codified in Title 18 of 
the United States Code, as well as the Standards of Ethical Conduct for 
Employees of the Executive Branch, 5 CFR part 2635.
    (b) Pursuant to the financial conflict of interest statute, 18 
U.S.C. 208 and 5 CFR part 2635, subparts D and E, each employee must 
abide by ethics requirements regarding financial conflict of interest 
and impartiality in performing official duties. The employee shall 
inform his or her Deputy Ethics Official and the Source Selection 
Authority (SSA) in writing if his/her participation in the source 
evaluation and selection process may raise possible or apparent 
conflict of interest or impartiality concerns. The employee must cease 
work on the source evaluation and selection process until the 
appropriate ethics official makes a determination. Please note that 
only the Office of General Counsel can direct employees to divest of 
financial interests or to recommend any waivers of the financial 
conflict of interest standards.


1503.104-4  Disclosure, protection, and marking of contractor bid or 
proposal information and source selection information.

    (a)(1) The Chief of the Contracting Office (CCO) is the designated 
official to make the decision whether support contractors are used in 
proposal evaluation (as authorized at FAR 15.305(c) and restricted at 
FAR 37.203(d)).
    (2) The following written certification and agreement shall be 
obtained from non-Government evaluator prior to the release of any 
proposal to that evaluator:
``Certification on the Use and Disclosure of Proposals''
RFP #:
Offeror:

    1. I hereby certify that to the best of my knowledge and belief, 
no conflict of interest exists that may diminish my capacity to 
perform an impartial, technically sound, objective review of this 
proposal(s) or otherwise result in a biased opinion or unfair 
competitive advantage.
    2. I agree to use any proposal information only for evaluation 
purposes. I agree not to copy any information from the proposal(s), 
to use my best effort to safeguard such information physically, and 
not to disclose the contents of nor release any information relating 
to the proposal(s) to anyone outside of the evaluation team 
assembled for this acquisition or individuals designated by the 
Contracting Officer.
    3. I agree to return to the Government all copies of proposals, 
as well as any abstracts, upon completion of the evaluation.

Name and Organization:
Date of Execution:


(End of certificate)

    (b) Information contained in proposals will be protected and 
disclosed to the extent permitted by law, and in accordance with FAR 
3.104-4, 15.207, and Agency procedures at 40 CFR part 2.

Subpart 1503.6--Contracts With Government Employees or 
Organizations Owned or Controlled by Them


1503.600-70  Scope of subpart.

    This subpart implements and supplements FAR subpart 3.6 and sets 
forth EPA policy and procedures for identifying and dealing with 
conflicts of interest and improper influence or favoritism in 
connection with contracts involving current or former EPA employees. 
This subpart does not apply to agreements with other departments or 
agencies of the Federal Government, nor to contracts awarded to State 
or local units of Government.


1503.600-71  Definitions.

    (a) Employee means an EPA officer and an individual who is 
appointed in the civil service and engaged in the performance of a 
Federal function under authority of law or an Executive act. See 5 
U.S.C. 2105.
    (b) Special government employee means an officer or employee of EPA 
who is retained, designated, appointed or employed to perform, with or 
without compensation, for not to exceed 130 days during any period of 
365 consecutive days, temporary duties either on a full-time or 
intermittent basis. See 18 U.S.C. 202.


1503.601  Policy.

    (a) No contract may be awarded without competition to a former 
employee or special government employee (or to a business concern or 
other organization owned or substantially owned or controlled by a 
former employee) whose employment terminated within 365 calendar days 
before submission of a proposal to EPA.
    (b) No contract shall be awarded without competition to a firm 
which employs, or proposes to employ, a current employee or special 
government employee, or a former EPA employee or special government 
employee, whose employment terminated within 365 calendar days before 
submission of a proposal to EPA, if either of the following conditions 
exists:
    (1) The current or former EPA employee or special government 
employee is or was involved in development or negotiating the proposal 
for the prospective contractor; or
    (2) The current or former EPA employee or special government 
employee will be involved directly or indirectly in the management, 
administration, or performance of the contract.


1503.602  Exceptions.

    The Assistant Administrator for the Office of Administration and 
Resources Management may authorize an exception, in writing, to the 
policy in FAR 3.601 and 1503.601 for the reasons stated in FAR 3.602, 
if the exception would not involve a violation of 18 U.S.C. 203, 18 
U.S.C. 205, 18 U.S.C. 207, 18 U.S.C. 208, the Standards of Ethical 
Conduct for Employees of the Executive Branch at 5 CFR part 2635, or 
the EPA supplemental regulations at 5 CFR part 6401. The Assistant 
Administrator shall consult with the Designated Agency Ethics Official 
before authorizing any exceptions.


1503.670   Disclosure provision.

    The Contracting Officer shall insert the provision at 1552.203-70, 
Current/Former Agency Employee Involvement Certification, in all 
solicitations for sole-source acquisitions.

Subpart 1503.9--Whistleblower Protections for Contractor Employees


1503.905  Procedures for investigating complaints.

    The Assistant Administrator for the Office of Administration and 
Resources Management is designated as the recipient of the written 
report of findings by the Inspector General. The Assistant 
Administrator shall ensure that the report of findings is disseminated 
in accordance with FAR 3.905(c).

Subpart 1503.10--Contractor Code of Business Ethics and Conduct


1503.1002  Policy.

    Government contractors must conduct themselves with the highest 
degree of integrity and honesty. Contractors should have standards of 
conduct and internal control systems that:
    (a) Are suitable to the size of the company and the extent of their 
involvement in Government contracting;
    (b) Promote such standards;
    (c) Facilitate timely discovery and disclosure of improper conduct 
in connection with Government contracts; and
    (d) Ensure corrective measures are promptly instituted and carried 
out.

[[Page 31180]]

1503.1003  Requirements.

    (a) A contractor's system of management controls should provide 
for:
    (1) A written code of business ethics and conduct and an ethics 
training program for all employees;
    (2) Periodic reviews of company business practices, procedures, 
policies and internal controls for compliance with standards of conduct 
and the special requirements of Government contracting;
    (3) A mechanism, such as a hotline, by which employees may report 
suspected instances of improper conduct, and instructions that 
encourage employees to make such reports;
    (4) Internal and/or external audits, as appropriate;
    (5) Disciplinary action for improper conduct;
    (6) Timely reporting to appropriate Government officials of any 
suspected or possible violation of law in connection with Government 
contracts or any other irregularities in connection with such 
contracts; and
    (7) Full cooperation with any Government agencies responsible for 
either investigation or corrective actions.
    (b) Contractors who are awarded an EPA contract of $1 million or 
more must display EPA Office of Inspector General Hotline Posters 
unless the contractor has established an internal reporting mechanism 
and program as described in paragraph (a) of this section.


1503.1004  Contract clause.

    As required by EPAAR 1503.1003(b), the contracting officer shall 
insert the clause at 1552.203-71, Display of EPA Office of Inspector 
General Hotline Poster, in all contracts valued at $1,000,000 or more, 
including all contract options.

PART 1552--SOLICITATION PROVISIONS AND CONTRACT CLAUSES

0
2. The authority citation for part 1552 is revised to read as follows:

    Authority:  5 U.S.C. 301 and 41 U.S.C. 418b.


0
3. Revise section 1552.203-70 to read as follows:


1552.203-70  Current/former agency employee involvement certification.

    As prescribed in 1503.670, insert the following provision in all 
EPA solicitations for sole-source acquisitions.

Current/Former Agency Employee Involvement Certification Jul 2016

    The offeror (quoter) hereby certifies that:
    (a) He/She is [ ] is not [ ] a former employee or special 
government employee whose EPA employment terminated within one year 
prior to submission of this offer (quote).
    (b) He/She does [ ] does not [ ] employ or propose to employ a 
current/former employee or special government employee whose EPA 
employment terminated within one year prior to submission of this 
offer (quote) and who has been or will be involved, directly or 
indirectly, in developing or negotiating this offer (quote) for the 
offeror (quoter), or in the management, administration or 
performance of any contract resulting from this offer (quote).
    (c) He/She does [ ] does not [ ] employ or propose to employ as 
a consultant or subcontractor under any contract resulting from this 
offer (quote) a current/former employee or special government 
employee whose EPA employment terminated within one year prior to 
submission of this offer (quote).
    (d) A former employee or special government employee whose EPA 
employment terminated within one year prior to submission of this 
offer (quote) or such former employee's spouse or minor child does [ 
] does not [ ] own or substantially own or control the offeror's 
(quoter's) firm.
    (e) See EPAAR part 1503.600-71 for definitions of the terms 
``employee'' and ``special government employee.''


(End of provision)
0
4. Revise section 1552.203-71 to read as follows:


1552.203-71  Display of EPA Office of Inspector General Hotline poster.

    As prescribed in 1503.1004, insert the following clause in all 
contracts valued at $1,000,000 or more including all contract options.

Display of EPA Office of Inspector General Hotline Poster Jul 2016

    (a) For EPA contracts valued at $1,000,000 or more including all 
contract options, the contractor shall prominently display EPA 
Office of Inspector General Hotline posters in contractor facilities 
where the work is performed under the contract.
    (b) Office of Inspector General hotline posters may be obtained 
from the EPA Office of Inspector General, ATTN: OIG Hotline (2443), 
1200 Pennsylvania Avenue NW., Washington, DC 20460, or by accessing 
the OIG Web site at: https://www.epa.gov/oig/hotline.html.
    (c) The Contractor need not comply with paragraph (a) of this 
clause if it has established a mechanism, such as a hotline, by 
which employees may report suspected instances of improper conduct, 
and has provided instructions that encourage employees to make such 
reports.


(End of clause)

[FR Doc. 2016-11509 Filed 5-17-16; 8:45 am]
 BILLING CODE 6560-50-P