Federal Acquisition Regulations: Audit of Settlement Proposals, 19149-19150 [2018-09169]
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Federal Register / Vol. 83, No. 84 / Tuesday, May 1, 2018 / Rules and Regulations
DOL rate is required by statute (the
Inflation Adjustment Act); GSA, DoD,
and NASA have no authority to change
the rate.
V. 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 not a significant
regulatory action and, therefore, was not
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.
VI. Executive Order 13771
This rule is not subject to E.O. 13771,
because this rule is not a significant
regulatory action under E.O. 12866.
PART 22—APPLICATION OF LABOR
LAWS TO GOVERNMENT
ACQUISITIONS
2. Amend section 22.302 by revising
paragraph (a) to read as follows:
■
22.302
pay.
Liquidated damages and overtime
(a) When an overtime computation
discloses underpayments, the
responsible contractor or subcontractor
must pay the affected employee any
unpaid wages and pay liquidated
damages to the Government. The
contracting officer must assess
liquidated damages at the rate specified
at 29 CFR 5.5(b)(2) per affected
employee for each calendar day on
which the employer required or
permitted the employee to work in
excess of the standard workweek of 40
hours without paying overtime wages
required by the statute. In accordance
with the Federal Civil Penalties
Inflation Adjustment Act of 1990 (28
U.S.C. 2461 Note), the Department of
Labor adjusts this civil monetary
penalty for inflation no later than
January 15 each year.
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VII. Regulatory Flexibility Act
Because a notice of proposed
rulemaking and an opportunity for
public comment are not required to be
given for this rule under 41 U.S.C.
1707(a)(1) (see section IV. of this
preamble), the analytical requirements
of the Regulatory Flexibility Act (5
U.S.C. 601 et seq.) are not applicable.
Accordingly, no regulatory flexibility
analysis is required and none has been
prepared.
PART 52—SOLICITATION PROVISIONS
AND CONTRACT CLAUSES
VIII. 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 22 and
52
Government procurement.
amozie on DSK30RV082PROD with RULES2
Dated: April 25, 2018.
William F. Clark,
Director, Office of Government-wide
Acquisition Policy, Office of Acquisition
Policy, Office of Government-wide Policy.
Therefore, DoD, GSA, and NASA
amend 48 CFR parts 22 and 52 as set
forth below:
■ 1. The authority citation for parts 22
and 52 continues to read as follows:
Authority: 40 U.S.C. 121(c); 10 U.S.C.
chapter 137; and 51 U.S.C. 20113.
VerDate Sep<11>2014
18:35 Apr 30, 2018
Jkt 244001
3. Amend section 52.222–4 by
revising the date of the clause and
paragraph (b) to read as follows:
■
52.222–4 Contract Work Hours and Safety
Standards—Overtime Compensation.
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Contract Work Hours and Safety
Standards—Overtime Compensation
(May, 2018)
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(b) Violation; liability for unpaid
wages; liquidated damages. The
responsible Contractor and
subcontractor are liable for unpaid
wages if they violate the terms in
paragraph (a) of this clause. In addition,
the Contractor and subcontractor are
liable for liquidated damages payable to
the Government. The Contracting
Officer will assess liquidated damages at
the rate specified at 29 CFR 5.5(b)(2) per
affected employee for each calendar day
on which the employer required or
permitted the employee to work in
excess of the standard workweek of 40
hours without paying overtime wages
required by the Contract Work Hours
and Safety Standards statute (found at
40 U.S.C. chapter 37). In accordance
with the Federal Civil Penalties
Inflation Adjustment Act of 1990 (28
U.S.C. 2461 Note), the Department of
Labor adjusts this civil monetary
PO 00000
Frm 00007
Fmt 4701
Sfmt 4700
19149
penalty for inflation no later than
January 15 each year.
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[FR Doc. 2018–09167 Filed 4–30–18; 8:45 am]
BILLING CODE 6820–14–P
DEPARTMENT OF DEFENSE
GENERAL SERVICES
ADMINISTRATION
NATIONAL AERONAUTICS AND
SPACE ADMINISTRATION
48 CFR Part 49
[FAC 2005–98, FAR Case 2015–039; Item
IV; Docket No. 2015–0039, Sequence
No. 1]
RIN 9000–AN26
Federal Acquisition Regulations: Audit
of Settlement Proposals
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 to amend the Federal
Acquisition Regulation (FAR) to raise
the dollar threshold requirement for the
audit of prime contract settlement
proposals and subcontract settlements
from $100,000 to align with the
threshold for obtaining certified cost or
pricing data.
DATES: Effective: May 31, 2018.
FOR FURTHER INFORMATION CONTACT: Ms.
Zenaida Delgado, Procurement Analyst,
at 202–969–7207, for clarification of
content. For information pertaining to
status or publication schedules, contact
the Regulatory Secretariat Division at
202–501–4755. Please cite FAC 2005–
98, FAR Case 2015–039.
SUPPLEMENTARY INFORMATION:
SUMMARY:
I. Background
DOD, GSA, and NASA published a
proposed rule in the Federal Register at
81 FR 63158 on September 14, 2016, to
amend FAR 49.107 to increase the
dollar threshold for the audit of prime
contract settlement proposals and
subcontract settlements submitted in the
event of contract termination, from
$100,000 to align with the threshold in
FAR 15.403–4(a)(1) for obtaining
certified cost or pricing data, which is
currently $750,000.
II. Discussion and Analysis
No public comments were submitted
in response to the proposed rule.
Therefore, there are no changes from the
proposed rule made in the final rule.
E:\FR\FM\01MYR2.SGM
01MYR2
19150
Federal Register / Vol. 83, No. 84 / Tuesday, May 1, 2018 / Rules and Regulations
III. Expected Cost Savings
This final rule impacts contractors
subject to audits of their termination
settlement proposals. The rule is
administrative in nature, because it
raises a threshold. This rule eliminates
termination settlements audits between
$100,000 and the threshold for
obtaining certified cost or pricing data,
currently $750,000. Contractors will
save costs associated with the
preparation and support for the
termination settlement audits. This will
also enable faster final settlement
payments to contractors, thereby
improving contractor cash flow.
IV. Applicability to Contracts at or
Below the Simplified Acquisition
Threshold and for Commercial Items,
Including Commercially Available Offthe-Shelf Items
This rule does not add any new
solicitation provisions or clauses, or
impact any existing provisions or
clauses.
V. 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 not a significant
regulatory action and, therefore, was not
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.
VI. Executive Order 13771
Pursuant to E.O. 13771, this rule is a
deregulatory action. Information on the
expected cost savings of this action can
be found in section III of the preamble.
amozie on DSK30RV082PROD with RULES2
VII. Regulatory Flexibility Act
DoD, GSA, and NASA 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:
This final rule amends FAR 49.107, Audit
of prime contract settlement proposals and
subcontract settlements, to raise the dollar
threshold for the audit of prime contract
settlement proposals and subcontract
settlements submitted in the event of contract
termination from $100,000 to the threshold
for obtaining certified cost or pricing data set
VerDate Sep<11>2014
18:35 Apr 30, 2018
Jkt 244001
forth in FAR 15.403–4(a)(1), which is
currently $750,000. The rule is necessary to
reduce the administrative burdens associated
with termination settlement proposals.
No public comments were received in
response to the initial regulatory flexibility
analysis.
DoD, GSA, and NASA do not expect this
rule to 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. Since the rule raises the
audit threshold, even fewer small businesses
will be subject to audits of their termination
settlement proposals. It is estimated that an
average of 4 small entities per year will be
relieved from the requirements of supporting
an audit of a contract settlement proposal,
which is a minute fraction of all contracts
awarded to small businesses in a typical year.
The rule imposes no reporting,
recordkeeping, or other information
collection requirements.
There are no known significant alternatives
to the rule. The impact of this rule on small
business is not expected to be significant.
Interested parties may obtain a copy
of the FRFA from the Regulatory
Secretariat Division. The Regulatory
Secretariat Division has submitted a
copy of the FRFA to the Chief Counsel
for Advocacy of the Small Business
Administration.
VIII. Paperwork Reduction Act
This 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 Part 49
Government procurement.
Dated: April 25, 2018.
William F. Clark,
Director, Office of Government-wide
Acquisition Policy, Office of Acquisition
Policy, Office of Government-wide Policy.
Therefore, DoD, GSA, and NASA
amend 48 CFR part 49 as set forth
below:
recommendations. The TCO may submit
settlement proposals of less than the
threshold for obtaining certified cost or
pricing data to the audit agency.
Referrals shall indicate any specific
information or data that the TCO
considers relevant and shall include
facts and circumstances that will assist
the audit agency in performing its
function. The audit agency shall
develop requested information and may
make any further accounting reviews it
considers appropriate. After its review,
the audit agency shall submit written
comments and recommendations to the
TCO. When a formal examination of
settlement proposals valued under the
threshold for obtaining certified cost or
pricing data is not warranted, the TCO
will perform or have performed a desk
review and include a written summary
of the review in the termination case
file.
(b) The TCO shall refer subcontract
settlements received for approval or
ratification to the appropriate audit
agency for review and recommendations
when—
(1) The amount exceeds the threshold
for obtaining certified cost or pricing
data; or
(2) The TCO determines that a
complete or partial accounting review is
advisable. The audit agency shall
submit written comments and
recommendations to the TCO. The
review by the audit agency does not
relieve the prime contractor or higher
tier subcontractor of the responsibility
for performing an accounting review.
*
*
*
*
*
[FR Doc. 2018–09169 Filed 4–30–18; 8:45 am]
BILLING CODE 6820–EP–P
DEPARTMENT OF DEFENSE
GENERAL SERVICES
ADMINISTRATION
NATIONAL AERONAUTICS AND
SPACE ADMINISTRATION
PART 49—TERMINATION OF
CONTRACTS
1. The authority citation for part 49
continues to read as follows:
■
Authority: 40 U.S.C. 121(c); 10 U.S.C.
chapter 137; and 51 U.S.C. 20113.
48 CFR Chapter 1
[Docket No. FAR 2018–0001, Sequence
No. 2]
■
2. Amend section 49.107 by revising
paragraphs (a) and (b) to read as follows:
Federal Acquisition Regulation:
Federal Acquisition Circular 2005–98;
Small Entity Compliance Guide
49.107 Audit of prime contract settlement
proposals and subcontract settlements.
AGENCY:
(a) The TCO shall refer each prime
contractor settlement proposal valued at
or above the threshold for obtaining
certified cost or pricing data set forth in
FAR 15.403–4(a)(1) to the appropriate
audit agency for review and
PO 00000
Frm 00008
Fmt 4701
Sfmt 4700
Department of Defense (DoD),
General Services Administration (GSA),
and National Aeronautics and Space
Administration (NASA).
ACTION: Small Entity Compliance Guide.
This document is issued
under the joint authority of DOD, GSA,
SUMMARY:
E:\FR\FM\01MYR2.SGM
01MYR2
]]>Agencies
[Federal Register Volume 83, Number 84 (Tuesday, May 1, 2018)]
[Rules and Regulations]
[Pages 19149-19150]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2018-09169]
-----------------------------------------------------------------------
DEPARTMENT OF DEFENSE
GENERAL SERVICES ADMINISTRATION
NATIONAL AERONAUTICS AND SPACE ADMINISTRATION
48 CFR Part 49
[FAC 2005-98, FAR Case 2015-039; Item IV; Docket No. 2015-0039,
Sequence No. 1]
RIN 9000-AN26
Federal Acquisition Regulations: Audit of Settlement Proposals
AGENCY: Department of Defense (DoD), General Services Administration
(GSA), and National Aeronautics and Space Administration (NASA).
ACTION: Final rule.
-----------------------------------------------------------------------
SUMMARY: DoD, GSA, and NASA are issuing a final rule to amend the
Federal Acquisition Regulation (FAR) to raise the dollar threshold
requirement for the audit of prime contract settlement proposals and
subcontract settlements from $100,000 to align with the threshold for
obtaining certified cost or pricing data.
DATES: Effective: May 31, 2018.
FOR FURTHER INFORMATION CONTACT: Ms. Zenaida Delgado, Procurement
Analyst, at 202-969-7207, for clarification of content. For information
pertaining to status or publication schedules, contact the Regulatory
Secretariat Division at 202-501-4755. Please cite FAC 2005-98, FAR Case
2015-039.
SUPPLEMENTARY INFORMATION:
I. Background
DOD, GSA, and NASA published a proposed rule in the Federal
Register at 81 FR 63158 on September 14, 2016, to amend FAR 49.107 to
increase the dollar threshold for the audit of prime contract
settlement proposals and subcontract settlements submitted in the event
of contract termination, from $100,000 to align with the threshold in
FAR 15.403-4(a)(1) for obtaining certified cost or pricing data, which
is currently $750,000.
II. Discussion and Analysis
No public comments were submitted in response to the proposed rule.
Therefore, there are no changes from the proposed rule made in the
final rule.
[[Page 19150]]
III. Expected Cost Savings
This final rule impacts contractors subject to audits of their
termination settlement proposals. The rule is administrative in nature,
because it raises a threshold. This rule eliminates termination
settlements audits between $100,000 and the threshold for obtaining
certified cost or pricing data, currently $750,000. Contractors will
save costs associated with the preparation and support for the
termination settlement audits. This will also enable faster final
settlement payments to contractors, thereby improving contractor cash
flow.
IV. Applicability to Contracts at or Below the Simplified Acquisition
Threshold and for Commercial Items, Including Commercially Available
Off-the-Shelf Items
This rule does not add any new solicitation provisions or clauses,
or impact any existing provisions or clauses.
V. 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 not a significant regulatory action and, therefore, was not
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.
VI. Executive Order 13771
Pursuant to E.O. 13771, this rule is a deregulatory action.
Information on the expected cost savings of this action can be found in
section III of the preamble.
VII. Regulatory Flexibility Act
DoD, GSA, and NASA 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:
This final rule amends FAR 49.107, Audit of prime contract
settlement proposals and subcontract settlements, to raise the
dollar threshold for the audit of prime contract settlement
proposals and subcontract settlements submitted in the event of
contract termination from $100,000 to the threshold for obtaining
certified cost or pricing data set forth in FAR 15.403-4(a)(1),
which is currently $750,000. The rule is necessary to reduce the
administrative burdens associated with termination settlement
proposals.
No public comments were received in response to the initial
regulatory flexibility analysis.
DoD, GSA, and NASA do not expect this rule to 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.
Since the rule raises the audit threshold, even fewer small
businesses will be subject to audits of their termination settlement
proposals. It is estimated that an average of 4 small entities per
year will be relieved from the requirements of supporting an audit
of a contract settlement proposal, which is a minute fraction of all
contracts awarded to small businesses in a typical year.
The rule imposes no reporting, recordkeeping, or other
information collection requirements.
There are no known significant alternatives to the rule. The
impact of this rule on small business is not expected to be
significant.
Interested parties may obtain a copy of the FRFA from the
Regulatory Secretariat Division. The Regulatory Secretariat Division
has submitted a copy of the FRFA to the Chief Counsel for Advocacy of
the Small Business Administration.
VIII. Paperwork Reduction Act
This 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 Part 49
Government procurement.
Dated: April 25, 2018.
William F. Clark,
Director, Office of Government-wide Acquisition Policy, Office of
Acquisition Policy, Office of Government-wide Policy.
Therefore, DoD, GSA, and NASA amend 48 CFR part 49 as set forth
below:
PART 49--TERMINATION OF CONTRACTS
0
1. The authority citation for part 49 continues to read as follows:
Authority: 40 U.S.C. 121(c); 10 U.S.C. chapter 137; and 51
U.S.C. 20113.
0
2. Amend section 49.107 by revising paragraphs (a) and (b) to read as
follows:
49.107 Audit of prime contract settlement proposals and subcontract
settlements.
(a) The TCO shall refer each prime contractor settlement proposal
valued at or above the threshold for obtaining certified cost or
pricing data set forth in FAR 15.403-4(a)(1) to the appropriate audit
agency for review and recommendations. The TCO may submit settlement
proposals of less than the threshold for obtaining certified cost or
pricing data to the audit agency. Referrals shall indicate any specific
information or data that the TCO considers relevant and shall include
facts and circumstances that will assist the audit agency in performing
its function. The audit agency shall develop requested information and
may make any further accounting reviews it considers appropriate. After
its review, the audit agency shall submit written comments and
recommendations to the TCO. When a formal examination of settlement
proposals valued under the threshold for obtaining certified cost or
pricing data is not warranted, the TCO will perform or have performed a
desk review and include a written summary of the review in the
termination case file.
(b) The TCO shall refer subcontract settlements received for
approval or ratification to the appropriate audit agency for review and
recommendations when--
(1) The amount exceeds the threshold for obtaining certified cost
or pricing data; or
(2) The TCO determines that a complete or partial accounting review
is advisable. The audit agency shall submit written comments and
recommendations to the TCO. The review by the audit agency does not
relieve the prime contractor or higher tier subcontractor of the
responsibility for performing an accounting review.
* * * * *
[FR Doc. 2018-09169 Filed 4-30-18; 8:45 am]
BILLING CODE 6820-EP-P
