Revise and Streamline VA Acquisition Regulation To Adhere to Federal Acquisition Regulation Principles (VAAR Case 2014-V001), 22635-22642 [2017-09158]

Agencies

• DEPARTMENT OF VETERANS AFFAIRS

[Federal Register Volume 82, Number 94 (Wednesday, May 17, 2017)]
[Proposed Rules]
[Pages 22635-22642]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2017-09158]



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DEPARTMENT OF VETERANS AFFAIRS

48 CFR Parts 801, 802, 803, 812, 814, 822, and 852

RIN 2900-AP50


Revise and Streamline VA Acquisition Regulation To Adhere to 
Federal Acquisition Regulation Principles (VAAR Case 2014-V001)

AGENCY: Department of Veterans Affairs.

ACTION: Proposed rule.

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SUMMARY: The Department of Veterans Affairs (VA) is proposing to amend 
and update its VA Acquisition Regulation (VAAR). Under this initiative 
all parts of the regulation are being reviewed in phased increments to 
revise or remove any policy that has been superseded by changes in the 
Federal Acquisition Regulation (FAR), to remove any procedural guidance 
that is internal to the VA, and to incorporate any new regulations or 
policies
    Acquisition regulations become outdated over time and require 
updating to incorporate additional policies, solicitation provisions, 
or contract clauses that implement and supplement the FAR to satisfy VA 
mission needs, and to incorporate changes in dollar and approval 
thresholds, definitions, and VA position titles and offices. This 
Proposed Rule will correct inconsistencies, remove redundant and 
duplicate material already covered by the FAR, delete outdated material 
or information, and appropriately renumber VAAR text, clauses and 
provisions where required to comport with FAR format, numbering and 
arrangement.
    This Proposed Rule will streamline the VAAR to implement and 
supplement the FAR only when required, and remove internal agency 
guidance as noted above in keeping with the FAR principles concerning 
agency acquisition regulations.

DATES: Comments must be received on or before July 17, 2017 to be 
considered in the formulation of the final rule.

ADDRESSES: Written comments may be submitted through 
www.Regulations.gov; by mail or hand-delivery to Director, Regulation 
Policy and Management (00REG), Department of Veterans Affairs, 810 
Vermont Avenue NW., Room 1068, Washington, DC 20420; or by fax to (202) 
273-9026. Comments should indicate that they are submitted in response 
to ``RIN 2900-AP50--Revise and Streamline VA Acquisition Regulation to 
Adhere to Federal Acquisition Regulation Principles (VAAR Case 2014-
V001--parts 801, 802, 803, 812, 814, 822, and 852).'' Copies of 
comments received will be available for public inspection in the Office 
of Regulation Policy and Management, Room 1068, between the hours of 
8:00 a.m. and 4:30 p.m., Monday through Friday (except holidays). 
Please call (202) 461-4902 for an appointment. This is not a toll-free 
number. In addition, during the comment period, comments may be viewed 
online through the Federal Docket Management System (FDMS) at 
www.Regulations.gov.

FOR FURTHER INFORMATION CONTACT: Mr. Ricky L. Clark, Senior Procurement 
Analyst, Procurement Policy and Warrant Management Services, 003A2A, 
425 I Street NW., Washington, DC 20001, (202) 632-5276. This is not a 
toll-free telephone number.

SUPPLEMENTARY INFORMATION: 

Background

    This action is being taken under the authority of the Office of 
Federal Procurement Policy Act which provides the authority for an 
agency head to authorize the issuance of agency acquisition regulations 
that implement or supplement the FAR. This authority ensures that 
Government procurements are handled fairly and consistently, that the 
Government receives overall best value, and that the Government and 
contractors both operate under a known set of rules.
    The Proposed Rule updates the VAAR to current FAR titles, 
requirements, and definitions; it updates VA titles and offices; it 
corrects inconsistencies, removes redundancies and duplicate material 
already covered by the FAR; it deletes outdated material or information 
and appropriately renumbers VAAR text and clauses and provisions where 
required to comport with FAR format, numbering and arrangement. All 
amendments, revisions, and removals have been peer reviewed and 
concurred with by an Integrated Product Team of agency stakeholders.
    The VAAR uses the regulatory structure and arrangement of the FAR 
and headings and subject areas are broken up consistent with the FAR 
content. The VAAR is divided into subchapters, parts (each of which 
covers a separate aspect of acquisition), subparts, sections, and 
subsections.
    The Office of Federal Procurement Policy Act provides the authority 
for the Federal Acquisition Regulation and for the issuance of Agency 
Acquisition regulations consistent with the FAR.
    When Federal agencies acquire supplies and services using 
appropriated funds, the purchase is governed by the FAR, set forth at 
Title 48 Code of Federal Regulations (CFR), chapter 1, parts 1 through 
53, and the agency regulations that implement and supplement the FAR. 
The VAAR is set forth at Title 48 CFR, chapter 8, parts 801 to 873. 
These authorities are designed to ensure that Government procurements 
are handled fairly and consistently, that the Government receives 
overall best value, and that the Government and contractors both 
operate under a known set of rules.
    VA is proposing to revise the VAAR to add new policy or regulatory 
requirements and to remove any guidance that is applicable only to VA's 
internal operating processes or procedures. Codified acquisition 
regulations may be amended and revised only through formal rulemaking 
under the Office of Federal Procurement Policy Act. This proposed rule 
will not have a significant economic impact on a substantial number of 
small entities as they are defined in the Regulatory Flexibility Act. 
This proposed rule will generally be small business neutral. VA has 
examined the economic, interagency, budgetary, legal, and policy 
implications of this regulatory action, and it has been determined this 
rule is not a significant regulatory action.

Discussion and Analysis

    VA proposes to make the following changes to the VAAR in this phase 
of its revision and streamlining initiative. For procedural guidance 
cited below that is proposed to be deleted from the VAAR, each section 
cited for removal is being considered for inclusion in VA's internal 
agency operating procedures in accordance with FAR 1.301(a)(2). 
Similarly, delegations of authorities that are removed from the VAAR 
will be included in the VA Acquisition Manual (VAAM) as internal agency 
guidance.
    We propose to revise the main parts reflected in the title of the 
case: VAAR parts 803, 814, and 822, as well as revisions to affected 
parts as a result of those changes: VAAR parts 801, 802, 812, and 852.
    We propose to revise the authority citations under Parts 801, 802, 
803, 812, 814, 822, and 852 to include a reference to 41 U.S.C. 
1121(c)(3) which is from Title 41, Public Contracts, Positive Law 
codification that speaks to the authority of an executive agency under 
another law to prescribe policies, regulations, procedures, and forms 
for procurement that are subject to the authority conferred in the 
cited section, as well as other sections of Title 41 as shown therein. 
Any other proposed changes to

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authorities are shown under the individual parts below.

VAAR Part 801--Department of Veterans Affairs Acquisition Regulation 
System

    This proposed rule removes an information collection burden 
previously included in the VAAR based on an outdated practice in 
providing bid envelopes. In section 801.106, OMB approval under the 
Paperwork Reduction Act, we propose to remove and discontinue the 
Office of Management and Budget (OMB) control number 2900-0593, clause 
852.214-70, as well as its prescription at 814.201-6(a), since sealed 
bids are solicited through the Governmentwide Point of Entry (GPE) and 
are largely submitted electronically rather than through the U.S. mail, 
thereby making the optional practice of providing bidders with envelops 
and return address label unnecessary.

VAAR Part 802--Definitions of Words and Terms

    In section 802.101, Definitions, we propose to add two new 
definitions to define two key terms used within the revised VAAR part 
803, Improper Business Practices and Personal Conflicts of Interests, 
dealing with debarment and suspensions and that will be applicable when 
referenced in the future in other VAAR parts: Debarment and Suspension 
Committee and Suspension and Debarring Official. These are necessary to 
ensure a clear understanding of the meaning of these terms and who is 
designated as the Suspension and Debarring Official (SDO).

VAAR Part 803--Improper Business Practices and Personal Conflicts of 
Interest

    We propose to clarify the language regarding the prohibition of 
contractors from making reference in their commercial advertising 
regarding VA contracts to avoid implying that the Government approves 
or endorses products or services. We propose to add a requirement that 
contracting officers require contractors and subcontractors at any tier 
to obtain signed non-disclosure statements from covered personnel.
    In subpart 803.1, Safeguards, we propose the remove and reserve the 
entire subpart for the reasons stated in the sections below which fall 
under the subpart. We propose to remove section 803.101, Standards of 
conduct, since it contains procedural guidance and a delegation of 
authority that is internal to the VA and will be in the VAAM.
    We propose to remove section 803.101-3, Department regulations, 
since it contains information on standards of conduct and financial 
disclosure for VA employees and is internal procedural guidance that is 
internal to the VA and will be in the VAAM.
    We propose to remove section 803.104, Procurement integrity, and 
section 803.104-7, Violations or possible violations, since they 
contain procedural guidance and a delegation of authority that is 
internal to the VA and will be in the VAAM. We propose to remove 
subsection 803.104-7, Violations or possible violations since it also 
contains procedural guidance and a delegation of authority that is 
internal to the VA and will be in the VAAM.
    In subpart 803.2, Contractor Gratuities to Government Personnel, we 
are proposing to update the policy governing improper business 
practices and personal conflicts of interests to make the agency's 
policies clear, to provide notice of due process rights and to 
establish who in the agency determines whether or not a violation of 
the Gratuities clause has occurred and what procedures are followed 
when the Suspension and Debarring Official (SDO) makes that decision.
    In section 803.204, we propose to remove portions of section 
803.204, Treatment of violations, which contain procedural guidance and 
a delegation of authority that is internal to the VA and will be moved 
to the VAAM. To ensure contractors are apprised of their rights, we 
propose to revise section 803.204 to add the responsibility of the 
Suspension and Debarring Official (SDO) for determining whether or not 
a violation of the Gratuities clauses has occurred and what action will 
be taken, as well as a paragraph that states that when the SDO 
determines that a violation has occurred and that debarment is being 
considered, the SDO shall follow the requirements at VAAR 809.406-3.
    In subpart 803.3, Reports of Suspected Antitrust Violations, we 
propose to remove section 803.303, Reporting suspected antitrust 
violations, since it contains guidance to VA employees that is internal 
to the VA and will be moved to the VAAM.
    In subpart 803.4, Contingent Fees, we propose to remove and reserve 
the entire subpart and to remove the underlying section 803.405, 
Misrepresentations or violations of the Covenant Against Contingent 
Fees, since it contains guidance to VA employees that is internal to 
the VA and will be moved to the VAAM.
    In subpart 803.5, Other Improper Business Practices, we propose to 
remove section 803.502, Subcontractor kickbacks, since it provides 
direction to VA employees that is internal to the VA and will be moved 
to the VAAM.
    In section 803.570, Commercial advertising, we propose to revise 
the language of subsection 803.570-1, Policy, to clarify the intent to 
prohibit advertising that implies a Government endorsement of the 
contractor's products or services.
    In subpart 803.6, Contracts with Government Employees or 
Organizations Owned or Controlled by Them, we propose to remove and 
reserve the entire subpart and to remove the underlying section 
803.602, Exceptions, since it delegates authority to authorize an 
exception to the policy in FAR 3.601. This delegation will be in the VA 
Acquisition Manual and is internal VAAM procedural guidance.
    In subpart 803.7, Voiding and Rescinding Contracts, we propose to 
remove and reserve the entire subpart and to remove the underlying 
sections. We propose to remove section 803.703, Authority, since it is 
a delegation of authority. This delegation will be in the VAAM and is 
internal VA procedural guidance. We propose to remove section 803.705, 
Procedures, as it duplicates FAR 3.705. A short paragraph that directs 
VA Heads of Contracting Activities to follow the procedures of FAR 
3.705 was added to the VAAM.
    In subpart 803.8, Limitation on the Payment of Funds to Influence 
Federal Transactions, we propose to remove and reserve the entire 
subpart and to remove the underlying sections. We propose to remove 
section 803.804, Policy, and section 803.806, Processing suspected 
violations. This is internal VA procedural guidance and will be moved 
to the VAAM.
    We propose to add subpart 803.11, Preventing Personal Conflicts of 
Interest for Contractor Employees Performing Acquisition Functions. 
This implements part of FAR clause 52.203-16, Preventing Personal 
Conflicts of Interest, by requiring the signing of a Non-Disclosure 
Agreement by certain contractor covered employees performing 
acquisition functions closely associated with inherently governmental 
functions in order to prohibit disclosure of non-public information 
accessed through performance on a Government contract. This also 
requires each contractor and subcontractor at any tier whose employees 
perform acquisition functions closely associated with inherently 
governmental functions to obtain the signed non-disclosure forms from 
each covered employee.

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    We propose to remove and reserve subpart 803.70, Contractor 
Responsibility to Avoid Improper Business Practices, and to remove its 
underlying section 803.7000, Display of the VA Hotline poster and its 
prescription at section 803.7001, Contract clause, because it is 
unnecessary and duplicates FAR coverage. FAR 52.203-14, Display of 
Hotline Poster(s), as prescribed at FAR 3.1004(b), provides adequate 
coverage for the VA. Agency internal procedures regarding fill-in 
information for the clause will be covered in the VAAM.

VAAR Part 812--Acquisition of Commercial Items

    In section 812.301, paragraph (b)(13), we propose to change the 
name of provision 852.214-74 to Marking of Bid Samples to better 
reflect the requirement of the provision.

VAAR Part 814--Sealed Bidding

    In subpart 814.1, Use of Sealed Bidding, we propose to delete the 
subpart in its entirety, to include its underlying sections. We propose 
to delete section 814.104, Types of contracts, and section 814.104-70, 
Fixed-price contracts with escalation, as unnecessary since both simply 
require compliance with FAR 16.203-1 through 16.203-4 and no additional 
VAAR text is required.
    In subpart 814.2, Solicitation of Bids, we propose to revise 
section 814.201(a)-(f) by: Removing paragraphs (a)-(b) since they deal 
with numbering of IFBs and consist of internal agency procedures which 
is more properly covered in VAAM subpart 804.16; and, by removing 
paragraphs (c) through (f) altogether under the existing section. The 
title of the section would remain, but no additional text is added.
    We propose to add a new subsection, 814.201-2, Part I--The 
Schedule, to explain how award will be made on summary bids and bids on 
groups of items to ensure this is clear to the public. In this new 
subsection 814.201-2, we propose to add revised paragraphs originating 
from the old 814.201 to comport with FAR numbering and arrangement 
under the new subsection VAAR 814.201-2(b) to implement FAR 14.201-
2(b).
    In subsection 814.201-6, Solicitation provisions, we propose to 
remove as unnecessary paragraph (a), which addresses bid envelopes, 
since labeling of bids is a customary and usual commercial practice, 
and the use of the OF 17, which is optional, is no longer a standard 
practice. We propose to redesignate paragraph (b) as (a) and to revise 
item (1) to prescribe new provision 852.214-71, Restrictions on 
alternate item(s); item (2) to clarify the conditions for including the 
provision 852.214-72, Alternate items; and item (3) to prescribe the 
provision 852.214-73, Alternate packaging and packing, when bids will 
be allowed based on different packaging and packing. We also proposed 
to redesignate paragraph (c) as (b) and to add a prescription for the 
provision 852.214-74, Marking of bid samples.
    We propose to add section 814.202, General rules for solicitation 
of bids and subsection 814.202-4, Bid samples, requiring samples to be 
from the manufacturer providing supplies or services under the 
contract. This ensures that the products that are actually proposed and 
would be delivered under the contract, if awarded, are the products 
that are submitted for evaluation. Paragraph (g), requires that bid 
samples be retained for the period of contract performance or until 
settlement of any claim that the Government may have against the 
contractor. Retention is intended for inspection purposes under FAR 
14.202-4(g)(4).
    We propose to delete section 814.203, Methods of soliciting bids, 
and subsection 814.203-1, Transmittal to prospective bidders, as the 
practice specified of furnishing a bid envelope or sealed bid label is 
out of date with existing practices.
    We propose to delete section 814.204, Records of Invitations for 
Bids and Records of Bids, as it contains internal instructions to the 
VA and will be moved to the VAAM.
    We propose to delete section 814.208, Amendment of Invitation for 
Bids as out of date with existing practices regarding sending 
amendments.
    In subpart 814.3, Submission of Bids, we propose to delete section 
814.301, Responsiveness of bids, since there is no authority to refer 
the question of timeliness to the U.S. Government Accountability Office 
(GAO) except in the context of a protest.
    We propose to delete section 814.302, Bid submission, as 
duplicative of FAR 14.302(a) and therefore unnecessary.
    We propose to revise section 814.304, Submission, modification, and 
withdrawal of bids, to delete internal procedures, to stipulate a 
limited time period for a late bidder to submit evidence of timeliness, 
and to renumber this paragraph (f) accordingly to comport with FAR and 
VAAR numbering conventions.
    In subpart 814.4, Opening of Bids and Award of Contract, we propose 
to delete the entire subpart because the information is either 
redundant to the FAR and is adequately covered there or it is comprised 
of agency internal procedures that will be incorporated into the VAAM 
as noted specifically below.
    We propose to delete section 814.401, Receipt and safeguarding of 
bids, because coverage in the VAAR is unnecessary as the FAR adequately 
covers.
    We propose to delete sections 814.402, Opening of bids; 814.403, 
Recording of bids; 814.404, Rejection of bids; 814.404-1, Cancellation 
of invitations after opening; 814.404-2, Rejection of individual bids; 
814.407, Mistakes in bids; 814.407-3, Other mistakes disclosed before 
award; and, 814.407-4, Mistakes after award, as these are agency 
internal procedures that will be incorporated into the VAAM.
    We propose to delete section 814.404-70, Questions involving the 
responsiveness of a bid, as there is no authority to refer questions of 
bid responsiveness to the GAO other than in the context of a protest, 
and, the overall responsibility for this determination rests with the 
contracting officer. Coverage in FAR 14.301, Responsiveness of bids, is 
adequate and no further VAAR coverage is required.
    We propose to delete sections 814.408, Award, and 814.408-70, Award 
when only one bid is received, because coverage in the VAAR is 
unnecessary as it is adequately covered by FAR 14.408-1(b).
    We propose to delete section 814.408-71, Recommendation for award 
(construction) as the procedures are no longer in use within the Office 
of Construction and Facilities Management.
    We propose to delete section 814.409, Information to bidders, as 
unnecessary since the requirement not to disclose is contained in FAR 
part 3 and need not be duplicated in the VAAR.

VAAR Part 822--Application of Labor Laws to Government Acquisitions

    In subpart 822.3, Contract Work Hours and Safety Standards Act, we 
propose to revise section 822.304, Variations, tolerances, and 
exemptions, to use plain language to state the conditions that must be 
met to permit use of the variation to Contract Work Hours and Safety 
Standards (the statute) (historically known as the Contract Work Hours 
and Safety Standards Act), granted by the Secretary of Labor regarding 
the payment of overtime under contracts for nursing home care for 
Veterans.
    We propose to revise section 822.305, Contract clause, to change 
the title of

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the clause at 852.222-70 to Contract Work Hours and Safety Standards--
Nursing Home Care for Veterans in order to reflect the way the FAR 
refers to the historical titles based on the Positive Law codification.
    In subpart 822.4, Labor Standards for Contracts Involving 
Construction, we propose to remove and reserve subpart 822.4, Labor 
Standards for Contracts Involving Construction, since this subpart 
contains procedural guidance on the types of labor standards involved 
in construction contracting, internal agency guidance to the 
contracting officer, etc., and is more appropriate for inclusion in the 
VAAM.
    We propose to remove the underlying section 822.406, Administration 
and enforcement and subsection 822.406-11, Contract terminations, which 
falls under this subpart since it contains procedural guidance and will 
be moved to the VAAM.

VAAR Part 852--Solicitation Provisions and Contract Clauses

    In subpart 852.2, we propose to revise clause 852.203-70, 
Commercial Advertising, to use plain language, remove gender-specific 
wording, and to clarify the intent to prohibit advertising that implies 
a Government endorsement of the contractor's products or services.
    We propose to remove clause 852.203-71, Display of Department of 
Veterans Affairs Hotline Poster, because the VA will instead use FAR 
clause 52.203-14, Display of Hotline Poster(s), as prescribed at FAR 
3.1004. The FAR clause permits insertion of fill-in language to 
identify an agency's hotline poster and VA will include language in its 
internal agency procedures detailing the requirement to insert the 
information regarding its agency specific hotline poster.
    We propose to remove provision 852.214-70, Caution to Bidders--Bid 
Envelopes, because the practices described within the provision are 
obsolete with the advent of posting on the Government wide point of 
entry (GPE) via the Federal Business Opportunities (FEDBIZOPPS.gov or 
FBO.gov) Web page or via a linked interface off of FBO.gov. VA no 
longer issues Bid Envelopes or the Optional Form (OF) 17, Sealed Bid 
Label, described in the provision, when electronically posting IFBs, 
thus making the provision obsolete and unnecessary. Additionally, the 
clause, which talks to the VA providing a Sealed Bid Label, is 
unnecessary since labeling a bid is a customary and usual business 
practice making it unnecessary for VA to provide an optional label.
    We propose to revise the individual prescription references for the 
following clauses based on the restructuring of 814.201-6: 852.214-71, 
Restrictions on Alternate Item(s); 852.214-72, Alternate Item(s); and 
852.214-73, Alternate Packaging and Packing.
    We propose to revise the title, text and prescription language of 
provision 852.214-74 that now reads, Bid Samples, to Marking of Bid 
Samples to describe better what the provision is about and to 
distinguish it from a FAR provision that is called ``Bid Samples.'' We 
use plain language to describe the principal purpose, which is to 
ensure that bidder's packages that include bid samples are clearly 
marked and identified with the words Bid Samples, as well as complete 
lettering/numbering and description of the related bid item(s), the 
number of the IFB, and the name of the bidder submitting the bid 
samples. We are also removing language stating that the preparation and 
transportation of the bid sample must be prepaid by the bidder as this 
language is unnecessary because FAR clause 52.214-20, Bid Samples, 
already contains language covering the bidder's responsibilities in 
this regard. We also propose to revise the prescription language for 
this provision at 814.201-6(b) which was renumbered to comport with FAR 
and VAAR numbering and arrangement.
    We propose to revise clause 852.222-70, Contract Work-Hours and 
Safety Standards Act--Nursing Home Care Contract Supplement, to change 
the title to Contract Work Hours and Safety Standards--Nursing Home 
Care for Veterans, to better reflect the substance and coverage of the 
clause and to align the name of the clause with the revised current 
reference in lieu of the historical title of the act. This revision 
will also clarify that the clause has flow-down requirements and 
applies to subcontractors at any tier when the stated conditions in the 
VAAR clause are met.

Effect of Rulemaking

    Title 48, Federal Acquisition Regulations System, Chapter 8, 
Department of Veterans Affairs, of the Code of Federal Regulations, as 
revised by this proposed rulemaking, represents VA's implementation of 
its legal authority and publication of the Department of Veterans 
Affairs Acquisition Regulation (VAAR) for the cited applicable parts. 
Other than future amendments to this rule or governing statutes for the 
cited applicable parts, or as otherwise authorized by approved 
deviations or waivers in accordance with FAR subpart 1.4, Deviations 
from the FAR, and as implemented by VAAR subpart 801.4, Deviations from 
the FAR or VAAR, no contrary guidance or procedures are authorized. All 
existing or subsequent VA guidance must be read to conform with the 
rulemaking if possible or, if not possible, such guidance is superseded 
by this rulemaking as pertains to the cited applicable VAAR parts.

Executive Orders 12866 and 13563

    Executive Orders (E.O.) 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. 
E.O. 12866, Regulatory Planning and Review defines ``significant 
regulatory action'' to mean any regulatory action that is likely to 
result in a rule that may: ``(1) Have an annual effect on the economy 
of $100 million or more or adversely affect in a material way the 
economy, a sector of the economy, productivity, competition, jobs, the 
environment, public health or safety, or State, local, or tribal 
governments or communities; (2) Create a serious inconsistency or 
otherwise interfere with an action taken or planned by another agency; 
(3) Materially alter the budgetary impact of entitlements, grants, user 
fees, or loan programs or the rights and obligations of recipients 
thereof; or (4) Raise novel legal or policy issues arising out of legal 
mandates, the President's priorities, or the principles set forth in 
this Executive order.''
    VA has examined the economic, interagency, budgetary, legal, and 
policy implications of this regulatory action, and it has been 
determined this rule is not a significant regulatory action under E.O. 
12866.
    VA's impact analysis can be found as a supporting document at 
https://www.regulations.gov, usually within 48 hours after the 
rulemaking document is published. Additionally, a copy of the 
rulemaking and its impact analysis are available on VA's Web site at 
https://www.va.gov/orpm by following the link for VA Regulations 
Published from FY 2004 Through Fiscal Year to Date.

Paperwork Reduction Act

    Although this action contains provisions constituting collections 
of information at 48 CFR 814.201-6(a) and

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852.214-70, under the provisions of the Paperwork Reduction Act of 1995 
(44 U.S.C. 3501-3521), no new or proposed revised collections of 
information are associated with this proposed rule. The information 
collection requirements for Sec. Sec.  48 CFR 814.201-6(a) and 852.214-
70 are currently approved by the Office of Management and Budget (OMB), 
have been assigned OMB control number 2900-0593, and are being proposed 
for removal and discontinuance.

Regulatory Flexibility Act

    This proposed rule will not have a significant economic impact on a 
substantial number of small entities as they are defined in the 
Regulatory Flexibility Act, 5 U.S.C. 601-612. This proposed rule will 
generally be small business neutral. The overall impact of the proposed 
rule will be 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 procedures. VA estimates no cost impact to individual 
business resulting from these rule updates. On this basis, the adoption 
of this proposed 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. Therefore, under 5 U.S.C. 
605(b), this proposed rule is exempt from the initial and final 
regulatory flexibility analysis requirements of sections 603 and 604.

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 proposed rule will have no such effect 
on State, local, and tribal Governments or on the private sector.

Signing Authority

    The Secretary of Veterans Affairs, or designee, approved this 
document and authorized the undersigned to sign and submit the document 
to the Office of the Federal Register for publication electronically as 
an official document of the Department of Veterans Affairs. Gina S. 
Farrisee, Deputy Chief of Staff, Department of Veterans Affairs, 
approved this document on May 1, 2017 for publication.

List of Subjects

48 CFR Part 801

    Administrative practice and procedure, Government procurement, 
Reporting and recordkeeping requirements.

48 CFR Part 802

    Government procurement.

48 CFR Part 803

    Antitrust, Conflict of interest, Government procurement.

48 CFR Part 812

    Government procurement.

48 CFR Part 814

    Government procurement.

48 CFR Part 822

    Government procurement, Labor.

48 CFR Part 852

    Government procurement, Reporting and recordkeeping requirements.

    Dated: May 2, 2017.
Janet Coleman,
Chief, Office of Regulation Policy & Management, Office of the 
Secretary, Department of Veterans Affairs.
    For the reasons set out in the preamble, VA proposes to amend 48 
CFR, chapter 8, parts 801, 802, 803, 812, 814, 822, and 852 as follows:

PART 801--DEPARTMENT OF VETERANS AFFAIRS ACQUISITION REGULATION 
SYSTEM

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1. The authority citation for part 801 is revised to read as follows:

    Authority: 38 U.S.C. 501; 40 U.S.C. 121(c); 41 U.S.C. 
1121(c)(3); and 48 CFR 1.301-1.304.


801.106  OMB approval under the Paperwork Reduction Act.

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2. In section 801.106, table columns titled ``48 CFR part or section 
where identified and described'' and ``Current OMB Control Number,'' 
are amended to remove the references to section 852.214-70 and the 
corresponding OMB Control Number 2900-0593.

PART 802--DEFINITIONS OF WORDS AND TERMS

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3. The authority citation for part 802 is revised to read as follows:

    Authority: 38 U.S.C. 501; 40 U.S.C. 121(c); 41 U.S.C. 
1121(c)(3); and 48 CFR 1.301-1.304.


802.101  Definitions

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4. Section 802.101 is amended to add the following definition in 
alphabetical order after ``D&S Committee'' to read as follows:
* * * * *
    Debarment and Suspension Committee means a committee authorized by 
the debarring official to assist the debarring official with debarment 
and suspension related matters. The Debarment and Suspension Committee 
is also referred to as the D&S Committee.
* * * * *
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5. Section 802.101 is amended to add the following definition in 
alphabetical order after ``Suspending Official'' to read as follows:
* * * * *
    Suspension and debarring official means the Senior Procurement 
Executive (SPE) or Deputy Senior Procurement Executive (DSPE) if 
further delegated in writing by the SPE. The Suspension and Debarring 
Official is also referred to as the SDO.
* * * * *

PART 803--IMPROPER BUSINESS PRACTICES AND PERSONAL CONFLICTS OF 
INTEREST

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6. The authority citation for part 803 is revised to read as follows:

    Authority: 38 U.S.C. 501; 40 U.S.C. 121(c); 41 U.S.C. 
1121(c)(3); and 48 CFR 1.301-1.304.

Subpart 803.1 [Removed and Reserved]

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7. Subpart 803.1 is removed and reserved.


803.204  [Amended]

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8. Section 803.204 is revised to read as follows:


803.204  Treatment of violations.

    (a) The SDO shall determine whether or not a violation of the 
Gratuities clause, 52.203-3 has occurred and what action will be taken 
under FAR 3.204(c).
    (c) When the SDO determines that a violation has occurred and that 
debarment is being considered, he or she shall follow procedures at 
809.406-3.

Subpart 803.3 [Removed and Reserved]

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9. Subpart 803.3 is removed and reserved.

Subpart 803.4 [Removed and Reserved]

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10. Subpart 803.4 is removed and reserved.


803.502  [Removed]

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11. Section 803.502 is removed.

[[Page 22640]]

803.570  [Amended]

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12. Section 803.570-1 is revised to read as follows:


803.570-1  Policy.

    VA policy prohibits contractors from making references in its 
commercial advertising to VA contracts in a manner that states or 
implies the Government approves or endorses the product or service or 
considers it superior to other products or services. The intent of this 
policy is to preclude the appearance of bias toward any product or 
service.

Subpart 803.6 [Removed and Reserved]

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13. Subpart 803.6 is removed and reserved.

Subpart 803.7 [Removed and Reserved]

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14. Subpart 803.7 is removed and reserved.

Subpart 803.8 [Removed and Reserved]

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15. Subpart 803.8 is removed and reserved.

Subpart 803.11 [Added]

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16. Subpart 803.11 is added to read as follows:

Subpart 803.11--Preventing Personal Conflicts of Interest for 
Contractor Employees Performing Acquisition Functions


803.1103  Procedures.

    (a) By use of the contract clause at 52.203-16, Preventing Personal 
Conflicts of Interest, the contracting officer shall require each 
contractor whose employees perform acquisition functions closely 
associated with inherently Governmental functions to obtain from each 
covered employee a signed non-disclosure agreement to prohibit 
disclosure of non-public information accessed through performance of a 
Government contract. See FAR 3.1103(a)(2)(iii).

Subpart 803.70 [Removed and Reserved]

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17. Subpart 803.70 is removed and reserved.

PART 812--ACQUISITION OF COMMERCIAL ITEMS

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18. The authority citation for part 812 is revised to read as follows:

    Authority: 38 U.S.C. 501; 40 U.S.C. 121(c); 41 U.S.C. 
1121(c)(3); and 48 CFR 1.301-1.304.
* * * * *


812.301  [Amended]

* * * * *
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19. Section 812.301, paragraph (b)(13) is revise to read as follows:


812.301  Solicitation provisions and contract clauses for the 
acquisition of commercial items.

* * * * *
    (b) * * *
    (13) 852.214-74, Marking of Bid Samples.
* * * * *

PART 814--SEALED BIDDING

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20. The authority citation for part 814 is revised to read as follows:

    Authority: 40 U.S.C. 121(c); 41 U.S.C. 1121(c)(3); and 48 CFR 
1.301-1.304.

Subpart 814.1 [Removed and Reserved]

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21. Subpart 814.1 is removed and reserved.


814.201  [Removed and reserved]

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22. Section 814.201 is removed and reserved.
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23. Subsection 814.201-2 is added to read as follows:


 814.201-2  Part I--The Schedule.

    (b) Section B, Supplies or services and prices.
    (1) When the contracting officer determines that it will be to the 
Government's advantage to make an award on the basis of a summary bid, 
the IFB shall include the following statement in Part I--The Schedule, 
Section B:
    The award will be made on either the bid price for individual items 
or the summary bid price summary for all items, whichever results in 
the lowest price to the Government. Therefore, to assure proper 
evaluation of all bids, a bidder quoting a summary bid price must also 
quote a price on each individual item included in the summary bid 
price.
    (2) When a contracting officer determines that it will be to the 
Government's advantage to make an award by group or groups of items, 
the IFB shall include the following statement in Part I--The Schedule, 
Section B:
    Award shall be made on the basis of the bid price for each 
identified group of items. The individual price of each line item in 
the group does not have to be the lowest bid received for that item. 
This may apply when the items in the group or groups are readily 
available from sources to be solicited; and one of the following 
applies--
    (i) Furniture or fixtures are required for a single project and 
uniformity of design is desirable.
    (ii) The articles required will be assembled and used as a unit.
* * * * *
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24. Subsection 814.201-6 is added to read as follows:


814.201-6  Solicitation provisions.

    (a) In an invitation for bid for supplies, equipment, or services 
(other than construction), the contracting officer shall define the 
extent to which VA will authorize and consider alternate bids.
    (1) The contracting officer shall include the provision at 852.214-
71, Restrictions on Alternate Items(s), in the invitation when VA will 
consider an alternate item only where acceptable bids on a desired item 
are not received or the bids do not satisfy the total requirement. (For 
construction projects, VA will consider for acceptance an alternate 
specified only as a part of the basic item.)
    (2) The contracting officer shall include the provision at 852.214-
72, Alternate Items, in the invitation, when VA will consider an 
alternate item on an equal basis with the item specified. (For 
construction projects, VA will consider for acceptance an alternate 
specified only as a part of the basic item.)
    (3) In addition to either of the provisions referenced in 
paragraphs (b)(1) or (2) of this subsection, the contracting officer 
shall include the provision at 852.214-73, Alternate Packaging and 
Packing, in the invitation when bids will be allowed based on different 
packaging, unit designation, etc.
    (b) The contracting officer shall include the provision at 852.214-
74, Marking of Bid Samples, in the invitation, along with the provision 
at FAR 52.214-20, Bid Samples, when the contracting officer determines 
that samples are necessary to the proper awarding of a contract.
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25. Subpart 814.2 is amended to add section 814.202 and subsection 
814.202-4, to read as follows:


814.202  General rules for solicitation of bids.


814.202-4  Bid samples.

    (a) Policy. When bid samples are required, the contracting officer 
shall include a notice in the contract Schedule that requires bidders 
to submit samples produced by the manufacturer whose products will be 
supplied under the contract.
    (g) Handling bid samples.

[[Page 22641]]

    (1) Samples from successful bids shall be retained for the period 
of contract performance.
    (2) If the contracting officer anticipates a claim regarding the 
contract, the contracting officer shall require that the bid samples be 
retained until the claim is resolved. If there are no outstanding 
claims regarding the contract, the contracting officer may authorize 
disposal of the samples at the end of the contract term in accordance 
with the bidder's instructions.
    (3) The contracting officer shall require that samples from 
unsuccessful bids be retained until award. After award, these samples 
may be disposed of in accordance with the bidder's instructions.


814.203  [Removed]

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26. Section 814.203 is removed.


814.204  [Removed]

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27. Section 814.204 is removed.


814.208  [Removed]

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28. Section 814.208 is removed.


814.301  [Removed]

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29. Section 814.301 is removed.


814.302  [Removed]

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30. Section 814.302 is removed.
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31. Section 814.304 is amended by removing paragraphs (a) and (b) and 
adding paragraph (f) to read as follows:


814.304  Submission, modification and withdrawal of bids.

* * * * *
    (f) A notification to late bidders shall specify the final date by 
which VA must receive evidence of timeliness. This date shall be within 
five calendar days of the date an electronic notice is sent to the 
bidder, or within ten calendar days of receipt by the bidder of a 
notice sent by other than electronic means.
* * * * *

Subpart 814.4 [Removed and Reserved]

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32. Subpart 814.4 is removed and reserved.
* * * * *

PART 822--APPLICATION OF LABOR LAWS TO GOVERNMENT ACQUISITIONS

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33. The authority citation for part 822 is revised to read as follows:

    Authority: 29 CFR 5.15(d); 38 U.S.C. 501; 40 U.S.C. 121(c); 41 
U.S.C. 1121(c)(3); and 48 CFR 1.301-1.304.
* * * * *

PART 822--APPLICATION OF LABOR LAWS TO GOVERNMENT ACQUISITIONS

Subpart 822.3--Contract Work Hours and Safety Standards Act

Sec.
822.304 Variations, tolerances, and exemptions.
822.305 Contract clause.


822.304  [Amended]

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34. Section 822.304 is revised to read as follows:


822.304  Variations, tolerances, and exemptions.

    For contracts providing nursing home care for veterans, the 
Secretary of Labor has allowed a variation to the requirements of 
Contract Work Hours and Safety Standards (the statute) (40 U.S.C. 3701, 
et seq.) regarding the payment of overtime (see 29 CFR 5.15(d)(2). The 
variation provides that overtime may be calculated on a basis other 
than a 40 hour workweek (as an alternate work period) when--
    (a) Due to operational necessity or convenience a work period of 14 
consecutive days may be accepted in lieu of the workweek of 7 
consecutive days for the purpose of computing overtime compensation, 
pursuant to an agreement or understanding arrived at between the 
contractor and the contractors' employees before performance of the 
work; and
    (b) If the contractor's employees receive compensation for 
employment in excess of 8 hours in any workday and in excess of 80 
hours in such 14-day period at a rate not less than 1\1/2\ times the 
regular rate at which the individual is employed, computed in 
accordance with the requirements of the Fair Labor Standards Act of 
1938, as amended.


822.305  [Amended]

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35. Section 822.305 is revised to read as follows:


822.305  Contract clause.

    The contracting officer shall insert the clause at 852.222-70, 
Contract Work Hours and Safety Standards--Nursing Home Care for 
Veterans, in solicitations and contracts for nursing home care for 
veterans. The contractor shall flow down this clause and insert in in 
all subcontracts, at any tier.

Subpart 822.4 [Removed and Reserved]

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36. Subpart 822.4 is removed and reserved.
* * * * *

PART 852--SOLICITATION PROVISIONS AND CONTRACT CLAUSES

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37. The authority citation for part 852 is revised to read as follows:

    Authority: 38 U.S.C. 501, 8127-8128, and 8151-8153; 40 U.S.C. 
121(c); 41 U.S.C. 1121(c)(3); and 48 CFR 1.301-1.304.
* * * * *

Subpart 852.2--Texts of Provisions and Clauses


852.203-70  [Amended]

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38. Section 852.203-70 is revised to read as follows:


852.203-70  Commercial Advertising.

    As prescribed in 803.570-2, insert the following clause:

Commercial Advertising (Date)

    The contractor shall not make reference in its commercial 
advertising to Department of Veterans Affairs contracts in a manner 
that states or implies the Department of Veterans Affairs approves 
or endorses the contractor's products or services or considers the 
contractor's products or services superior to other products or 
services.
    (End of clause)

852.203-71  [Removed and Reserved]

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39. Section 852.203-71 is removed and reserved.
* * * * *


852.214-70  [Removed and Reserved]

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40. Section 852.214-70 is removed and reserved.


852.214-71  [Amended]

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41. Section 852.214-71 is revised to read as follows:


852.214-71  Restrictions on alternate item(s).

    As prescribed in paragraph 814.201-6(a)(1), insert the following 
provision:

Restrictions on Alternate Item(s) (Date)

    Bids on [ ] * will be considered only if acceptable bids on [ ] 
** are not received or do not satisfy the total requirement.
    * Contracting officer will insert an alternate item that is 
considered acceptable.
    ** Contracting officer will insert the required item and item 
number.
    (End of provision)

852.214-72  [Amended]

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42. Section 852.214-72 is revised to read as follows:


852.214-72  Alternate item(s).

    As prescribed in paragraph 814.201-6(a)(2), insert the following 
provision:

[[Page 22642]]

Alternate Item(s) (Date)

    Bids on [ ] * will be given equal consideration along with bids 
on [ ] ** and any such bids received may be accepted if to the 
advantage of the Government. Tie bids will be decided in favor of [ 
]. **
    * Contracting officer will insert an alternate item that is 
considered acceptable.
    ** Contracting officer will insert the required item and item 
number.
    (End of provision)

852.214-73  [Amended]

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43. Section 852.214-73 is revised to read as follows:


852.214-73  Alternate packaging and packing.

    As prescribed in paragraph 814-201-6(a)(3), insert the following 
provision:

Alternate Packaging and Packing (Date)

    The bidders offer must clearly indicate the quantity, package 
size, unit, or other different feature upon which the quote is made. 
Evaluation of the alternate or multiple alternates will be made on a 
common denominator such as per ounce, per pound, etc., basis.
    (End of provision)

 852.214-74  [Amended]

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44. Section 852.214-74 is revised to read as follows:


852.214-74  Marking of Bid Samples.

    As prescribed in paragraph 814.201-6(b), insert the following 
provision:

Marking of Bid Samples (Date)

    Any bid sample(s) furnished must be in the quantities specified 
in the solicitation. Cases or packages must be plainly marked `Bid 
Sample(s)'' with the complete lettering/numbering and description of 
the related bid item(s), the number of the Invitation for Bids, and 
the name of the bidder submitting the bid sample(s).
    (End of provision)

* * * * *


852.222-70  [Amended]

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45. Section 852.222-70 is revised to read as follows:


852.222-70  Contract Work-Hours and Safety Standards--Nursing Home Care 
for Veterans.

    As prescribed in 822.305, insert the following clause:

Contract Work Hours and Safety Standards--Nursing Home Care for 
Veterans (Date)

    (a) No Contractor and subcontractor under this contract shall 
prohibit the payment of overtime wages to their employees for work 
in excess of 40 hours in any workweek, which would otherwise be a 
violation of Contract Work Hours and Safety Standards (the statute) 
(40 U.S.C. 3701, et seq.), provided--
    (1) The Contractor or subcontractor is primarily engaged in the 
care of nursing home patients residing on the contractor's or 
subcontractor's premises;
    (2) There is an agreement or understanding between the 
Contractor or subcontractor and their employees, before performance 
of work, that a work period of 14 consecutive days is acceptable in 
lieu of a work period of 7 consecutive days for the purpose of 
overtime compensation;
    (3) Employees receive overtime compensation at a rate no less 
than 1\1/2\ times the employees' regular hourly rate of pay for work 
in excess of 80 hours in any 14 day period; and
    (4) Pay is otherwise computed in accordance with the 
requirements of the Fair Labor Standards Act of 1938, as amended.
    (b) Subcontracts. The Contractor shall insert the text of this 
clause, including this paragraph (b), in subcontracts at any tier. 
The Contractor shall be responsible for compliance by any 
subcontractor or lower-tier subcontractor with the provisions set 
forth in paragraphs (a) through (b) of this clause.
    (End of clause)

[FR Doc. 2017-09158 Filed 5-16-17; 8:45 am]
BILLING CODE 8320-01-P