Defense Federal Acquisition Regulation Supplement: Restrictions on Use of Lowest Price Technically Acceptable Source Selection Process (DFARS Case 2018-D010), 50785-50789 [2019-20557]
Download as PDF
<![CDATA[
khammond on DSKJM1Z7X2PROD with RULES
Federal Register / Vol. 84, No. 187 / Thursday, September 26, 2019 / Rules and Regulations
Entities, and Significant Alternatives
Considered. The RFA requires an
agency to describe any significant,
specifically small business, alternatives
that it has considered in reaching its
proposed approach, which may include
the following four alternatives (among
others): ‘‘(1) the establishment of
differing compliance or reporting
requirements or timetables that take into
account the resources available to small
entities; (2) the clarification,
consolidation, or simplification of
compliance and reporting requirements
under the rule for such small entities;
(3) the use of performance rather than
design standards; and (4) an exemption
from coverage of the rule, or any part
thereof, for such small entities.’’
155. The Commission believes that
the steps described below to facilitate
participation in 833 Auction will result
in both operational and administrative
cost savings for small entities and other
auction participants. For example,
assigning toll free numbers through
competitive bidding will benefit smaller
entities rather than the prior first-come
first-served basis which favored larger,
more sophisticated entities that had
invested in obtaining enhanced
connectivity to the Toll Free Database.
Moreover, the Commission also elected
to allow potential subscribers, many of
which are smaller entities, the choice
between participating directly in the
auction or indirectly through a RespOrg.
In addition, the Commission created an
alternative payment mechanism that
will be available for both upfront and
final payments, in which applicants can
submit payments via ACH instead of
wire transfer if the payments are below
a $300 threshold. The Commission
believes such measures will benefit
small entities, who may be interested in
only acquiring one or perhaps a few toll
free numbers.
156. The procedures adopted in the
833 Auction Procedures Public Notice to
facilitate participation in the 833
Auction will result in both operational
and administrative cost savings for
small entities and other auction
participants. In light of the numerous
resources that will be available from the
Commission and Somos at no cost, the
processes and procedures adopted in
the 833 Auction Procedures Public
Notice should result in minimal
economic impact on small entities. For
example, prior to the auction, small
entities and other auction participants
may seek clarification of or guidance on
complying with application procedures,
reporting requirements, and the bidding
system. Small entities as well as other
auction participants will be able to avail
themselves of (1) a web-based,
VerDate Sep<11>2014
17:19 Sep 25, 2019
Jkt 247001
interactive online tutorial to familiarize
themselves with auction procedures,
filing requirements, bidding procedures,
and other matters related to the 833
Auction and (2) a telephone hotline to
assist with issues such as access to or
navigation within the auction
application system. The Commission
and Somos also make copies of
Commission decisions available to the
public without charge, providing a lowcost mechanism for small businesses to
conduct research prior to and
throughout the auction. In addition,
Somos will post public notices on its
website, making this information easily
accessible and without charge to benefit
all 833 Auction applicants, including
small businesses. These steps are made
available to facilitate participation in
the 833 Auction by all eligible bidders
and may result in significant cost
savings for small business entities who
utilize these alternatives. Moreover, the
adoption of bidding procedures in
advance of the auctions is designed to
ensure that the 833 Auction will be
administered predictably and fairly for
all participants, including small
businesses.
157. The Commission will send a
copy of the 833 Auction Procedures
Public Notice, including the
Supplemental FRFA, to the Chief
Counsel for Advocacy of the SBA. A
copy of the 833 Auction Procedures
Public Notice (or summary thereof) will
also be published in the Federal
Register.
50785
DoD is issuing a final rule
amending the Defense Federal
Acquisition Regulation Supplement
(DFARS) to implement sections of the
National Defense Authorization Acts for
Fiscal Years 2017 and 2018 that
establish limitations and prohibitions
on the use of the lowest price
technically acceptable source selection
process.
DATES: Effective October 1, 2019.
FOR FURTHER INFORMATION CONTACT: Ms.
Carrie Moore, telephone 571–372–6093.
SUPPLEMENTARY INFORMATION:
SUMMARY:
I. Background
DoD published a proposed rule in the
Federal Register at 83 FR 62550 on
December 4, 2018, to implement the
limitations and prohibitions on use of
the lowest price technically acceptable
(LPTA) source selection process
provided in sections 813, 814, and 892
of the National Defense Authorization
Act (NDAA) for Fiscal Year (FY) 2017
(Pub. L. 114–328) and sections 822, 832,
882, and 1002 of the NDAA for FY 2018
(Pub. L. 115–91). Sixteen respondents
submitted public comments in response
to the proposed rule.
II. Discussion and Analysis
DoD reviewed the public comments in
the development of the final rule. A
discussion of the comments is provided
as follows:
Federal Communications Commission.
Marlene Dortch,
Secretary.
A. Significant Changes as a Result of
Public Comments
No changes from the proposed rule
are made in the final rule as a result of
the public comments received.
[FR Doc. 2019–20526 Filed 9–25–19; 8:45 am]
B. Analysis of Public Comments
BILLING CODE 6712–01–P
1. Support for the Rule
Comment: Several respondents
express support for the rule.
Response: DoD acknowledges support
for the rule.
DEPARTMENT OF DEFENSE
Defense Acquisition Regulations
System
48 CFR Parts 208, 212, 213, 215, 216,
217, 234, and 237
[Docket DARS–2018–0055]
RIN 0750–AJ74
Defense Federal Acquisition
Regulation Supplement: Restrictions
on Use of Lowest Price Technically
Acceptable Source Selection Process
(DFARS Case 2018–D010)
Defense Acquisition
Regulations System, Department of
Defense (DoD).
ACTION: Final rule.
AGENCY:
PO 00000
Frm 00075
Fmt 4700
Sfmt 4700
2. General Comments
Comment: A respondent expresses
concern that the rule will be interpreted
as a complete prohibition on the use of
the LPTA source selection process. The
respondent recommends revising the
rule to clarify that use of the process is
acceptable and expand on the
circumstances in which it is or is not
appropriate for use in acquisitions.
Response: It is not the intent of the
rule to prohibit the use of the LPTA
source selection process. The LPTA
source selection process is a valuable
part of the best value continuum and an
acceptable and appropriate source
selection approach for many
acquisitions. Instead, the intent of the
E:\FR\FM\26SER1.SGM
26SER1
50786
Federal Register / Vol. 84, No. 187 / Thursday, September 26, 2019 / Rules and Regulations
khammond on DSKJM1Z7X2PROD with RULES
rule is to implement the statutory
language, which aims to identify
meaningful circumstances that must
exist for an acquisition to use the LPTA
source selection process and certain
types of requirements that will regularly
benefit from the use of tradeoff source
selection procedures. If a requirement
satisfies the limitations for use of the
LPTA source selection process, then the
process may be used as a source
selection approach. Supplemental
information to contracting officers on
when and from whom to seek additional
guidance on whether a requirement
satisfies the limitations at 215.101–2–
70(a)(1) will be published in the DFARS
Procedures, Guidance, and Information
(PGI) in conjunction with this final rule.
Comment: One respondent expresses
concern about how the agencies using
fully automated systems to award
contracts are going to implement this
rule.
Response: Each Department or agency
is required to implement the
requirements of this final rule in its
acquisition business processes and
procedures.
Comment: One respondent expresses
support for additional training and
guidance that will assist acquisition
personnel in making best value
decisions.
Response: Training is readily
available to DoD personnel on a variety
of acquisition topics, including best
value decisions. Upon publication of the
final rule, the DFARS PGI will be
updated to provide contracting officers
with information on when and from
whom to seek additional guidance when
acquiring supplies and services that are
impacted by this rule.
3. Expansion of the Applicability of the
Rule
Comment: Some respondents
recommend applying greater restrictions
on the types of acquisitions that can use
the LPTA source selection process. For
example, a respondent suggests revising
this rule to only authorize the use of the
LPTA source selection process when
acquiring goods that are predominantly
expendable in nature, non-technical, or
have a short shelf life or life expectancy.
Another respondent suggests limiting
the use of the LPTA source selection
process to only commercial and
commercial-off-the-shelf items valued at
or below the simplified acquisition
threshold, while expressly prohibiting
its use for all other requirements.
Response: To ensure that DoD is not
denied the benefit of cost and technical
tradeoffs in the source selection process,
the rule identifies meaningful
circumstances that must exist for an
VerDate Sep<11>2014
17:19 Sep 25, 2019
Jkt 247001
individual requirement to use the LPTA
source selection process. Each
requirement has a unique set of
circumstances that should be
considered when developing a source
selection approach. The LPTA source
selection process is a valuable part of
the best value continuum and can be
used to facilitate an effective and
competitive acquisition approach,
depending on the circumstances of the
acquisition. Limiting the use of the
LPTA source selection process to only
goods, commercial items under a
specific dollar threshold, or other
broadly defined groupings does not
fully consider the circumstances of an
individual requirement and could result
in additional and unnecessary time and
cost burdens for both Government and
industry.
4. Limitation Criteria at 215.101–2–
70(a)(1)
a. Application of Criteria
Comment: Some respondents
recommend revising the rule to clarify
whether each limitation listed at
215.101–2–70(a)(1) applies to supplies,
services, or both supplies and services.
In particular, a respondent suggests that
the rule text be clarified to ensure that
the limitations at 215.101–2–70(a)(i)
through (iv) are applied to both supplies
and services. The respondent also
suggests restructuring the rule text by
dividing the limitations into two
paragraphs: One paragraph that
identifies the limitations that apply to
the acquisition of supplies, and one that
identifies the limitations that apply to
the acquisition of services. In contrast,
another respondent expresses support
for retaining the existing structure of the
rule.
Response: The statutory language
being implemented by the rule does not
categorize the limitations into those that
apply to supplies or services. As a
result, the list of limitations at 215.101–
2–70(a)(1)(i) through (viii) is written to
apply to any acquisition that utilizes the
LPTA source selection process. In
consideration of these limitations, the
contracting officer must document the
contract file with a description of the
circumstances that justify the use of the
LPTA source selection process.
One exception is the limitation at
215.101–2–70(a)(1)(vi), which
implements paragraph (a)(3) of section
822 of the NDAA for FY 2018 that states
the limitation is ‘‘with respect to a
contract for the procurement of goods;’’
as such, this rule specifically identifies
that goods must meet this limitation.
PO 00000
Frm 00076
Fmt 4700
Sfmt 4700
b. Additional Criteria
Comment: Some respondents suggest
that additional criteria be added to the
list of limitations in order to satisfy
Congressional intent. Specifically, one
respondent suggests that ‘‘noncomplex’’ be added to the additional
criteria for goods at 215.101–2–
70(a)(1)(vi). The respondent also
suggests adding another factor to the list
that expressly limits the use of LPTA
source selection procedures to
procurements where the risk of
unsuccessful performance is minimal.
Response: The intent of this rule is to
implement the statutory language,
which does not include ‘‘non-complex’’
as a criteria to meet when purchasing
goods, or a limitation on acceptable
performance risk, when using the LPTA
source selection process.
Comprehensively, the consideration of
each limitation at 215.101–2–70(a)(1)
provides an effective evaluation of a
requirement’s suitability to use of the
LPTA source selection process and
reflects the intent of the statutory
language; therefore, no additional
limitation criteria are included in this
final rule.
c. Clarification of Terms
Comment: Some respondents indicate
that the terms used in the rule are
unclear. Specifically, one respondent
suggests modifying paragraph 215.101–
2–70(a)(1)(ii) to expressly state that
‘‘value’’ includes both qualitative and
quantitative value to be realized by DoD.
Another respondent advises that it is
unclear what ‘‘full life-cycle costs’’
means when acquiring services.
Response: Supplemental guidance
will be published in DFARS PGI in
conjunction with this final rule to assist
contracting officers in documenting the
contract file with a determination that
the lowest price reflects full life-cycle
costs. The term ‘‘value’’ includes
monetary and non-monetary benefits, as
applicable to the requirement. The term
also considers whether DoD is willing to
pay more than a minimum price in
return for non-monetary benefits (e.g.,
greater functionality, higher
performance, or lower performance
risk). The rule does not place any
limitations on the meaning of the term.
d. Documentation of Justification
Comment: A respondent expresses
concern that this rule requires a written
justification when using the LPTA
source selection process. As acquisition
planning already requires the
contracting officer to document the
acquisition process and the rationale
behind the decision to use one process
E:\FR\FM\26SER1.SGM
26SER1
Federal Register / Vol. 84, No. 187 / Thursday, September 26, 2019 / Rules and Regulations
khammond on DSKJM1Z7X2PROD with RULES
or method over another, the respondent
views the documentation required by
this rule to be unnecessary. In contrast,
another respondent suggests that this
rule expand the documentation
requirement to include a description
and analysis of the all the requirements
at 215.101–2–70(a)(1) in order to justify
the use of the LPTA source selection
process and require the justification to
be posted with the solicitation.
Response: This rule implements
statutory language that requires a
contracting officer document the
contract file with the circumstances
justifying the use of the LPTA source
selection process. The rule does not
specify a format or method to be used
to meet this statutory requirement. The
appropriate format of the justification
and the method of incorporation into
the contract file is left to the discretion
of each Department or agency. When
developing a source selection approach,
acquisition personnel consider the
unique circumstances of a requirement
and determine the method that will
result in the best value to DoD.
Publicizing the justification with the
solicitation is not required by statute
and could result in increased cost and
time burden to both Government and
industry.
5. List of Services and Supplies at
215.101–2–70(a)(2)
Comment: A respondent suggests that
the rule specify how a contracting
officer determines that a procurement is
predominately for a specific category of
service.
Response: For solicitation and
reporting purposes, contracting officers
assign each acquisition a product or
service code that best represents the
predominant dollar amount of supplies
or services being procured on an award.
This code will determine whether the
acquisition is subject to the limitations
at 215.101–2–70(a)(2).
Comment: A respondent recommends
that the list include services directly
related to national security, in order to
implement the intent of Congress.
Response: The intent of this rule is to
implement the requisite statutory
language, which does not include
‘‘services directly related to national
security’’ in the list of service categories
that must avoid using the LPTA source
selection process, to the maximum
extent practicable; as such, the rule text
does not include such services in
215.101–2–70(a)(2)(i).
Comment: A respondent suggests that
the list of services at 215.101–2–
70(a)(2)(i) expressly include advisory
and assistance services, as the term
‘‘knowledge-based professional
VerDate Sep<11>2014
17:19 Sep 25, 2019
Jkt 247001
services’’ may be misinterpreted to not
include advisory and assistance
services.
Response: The intent of this rule is to
implement the requisite statutory
language, which does not explicitly
include advisory and assistance
services; therefore, the rule text does not
identify advisory and assistance services
in 215.101–2–70(a)(2)(1).
Comment: Section 880(c) of the
NDAA for FY 2019 restricts civilian
agencies from using the LPTA source
selection process for procurements that
are predominately for the same services
listed at 215.101–2–70(a)(2)(i), and also
includes ‘‘health care services and
records’’ and ‘‘telecommunication
devices and services’’ to the list. To
harmonize the requirements between
the FAR and the DFARS or comply with
statute, a couple of respondents suggest
the rule incorporate the two additional
categories from section 880(c) into the
restrictions at 215–101–2–70(a)(2).
Response: The intent of this rule is to
implement the statutes at sections 813,
814, and 892 of the NDAA for FY 2017,
and sections 822, 832, 882, and 1002 of
the NDAA for FY 2018. Section 880 of
the NDAA for FY 2019 is being
implemented via FAR case 2018–016,
Lowest Price Technically Acceptable
Source Selection Process, and does not
apply to DoD.
6. Suggestion for Technical Edit
Comment: One respondent suggests
that the two sentences regarding audit
services at 215.101–2–70(b)(3) be
reversed to state the prohibition upfront
and follow with how award decisions
shall be made for such services.
Response: The primary intent of the
text, as arranged, is to address the action
a contracting officer shall take when
awarding an auditing contract;
therefore, no change is made to the final
rule.
C. Other Changes
An editorial change was made to the
rule to update the reference at 213.106–
1(a)(2)(ii) from 215.101–70 to 215.101–
2–70.
III. Applicability to Contracts at or
Below the Simplified Acquisition
Threshold and for Commercial Items,
Including Commercially Available Offthe-Shelf Items
This rule does not create any new
DFARS clauses or amend any existing
DFARS clauses.
IV. Executive Orders 12866 and 13563
Executive Orders (E.O.s) 12866 and
13563 direct agencies to assess all costs
and benefits of available regulatory
PO 00000
Frm 00077
Fmt 4700
Sfmt 4700
50787
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.
V. Executive Order 13771
This final rule is not subject to E.O.
13771, because this rule is not a
significant regulatory action under E.O.
12866.
VI. Regulatory Flexibility Act
This rule primarily affects the internal
Government procedures, including
requirements determination and
acquisition strategy decisions, and
contract file documentation
requirements. However, a final
regulatory flexibility analysis (FRFA)
has been prepared consistent with the
Regulatory Flexibility Act, 5 U.S.C. 601,
et seq. The FRFA is summarized as
follows:
DoD is amending the Defense Federal
Acquisition Regulation Supplement
(DFARS) to implement sections of the
National Defense Authorization Act
(NDAA) for Fiscal Year (FY) 2017 (Pub.
L. 114–328) and the NDAA for FY 2018
(Pub. L. 115–91). These sections
establish a preference for the use of the
tradeoff source selection process for
certain safety items and auditing
services; prohibit the use of reverse
auctions or the lowest price technically
acceptable (LPTA) source selection
process for specific supplies and
services; and specify criteria for the use
of the LPTA source selection process.
No public comments were received in
response to the initial regulatory
flexibility analysis.
DoD does not have information on the
total number of solicitations issued on
an annual basis that specified the use of
the LPTA source selection process, or
the number or description of small
entities that are impacted by certain
solicitations. However, the Federal
Procurement Data System (FPDS)
provides the following information for
fiscal year 2016:
DoD competitive contracts using FAR
part 15 procedures. DoD awarded
18,361 new contracts and orders using
competitive negotiated procedures, of
E:\FR\FM\26SER1.SGM
26SER1
khammond on DSKJM1Z7X2PROD with RULES
50788
Federal Register / Vol. 84, No. 187 / Thursday, September 26, 2019 / Rules and Regulations
which 47% were awarded to 5,221
unique small business entities. It is
important to note that FPDS does not
collect data on the source selection
process used for a solicitation.
Therefore, this data includes
competitive solicitations using LPTA or
tradeoff source selection processes,
which will be subject to future
considerations and restrictions provided
by section 813 of the NDAA for FY 2017
and section 822 of the NDAA for FY
2018.
Personal protective equipment. DoD
competitively awarded 9,130 new
contracts and orders potentially for
combat-related personal protective
equipment items that could be impacted
by restrictions in section 814 of the
NDAA for FY 2017. Of those new
contracts and orders, 89% were
awarded to 668 unique small business
entities.
Aviation critical safety items. As
discussed during the rulemaking
process for DFARS clause 252.209–7010
published in the Federal Register at 76
FR 14641 on March 17, 2011, the
identification of aviation critical safety
items occurs entirely outside of the
procurement process and is not
captured in FPDS. Therefore, it is not
possible for DoD to assess the impact of
section 814 of the NDAA for FY 2017,
as amended by 822 of the NDAA for FY
2018 on small business entities.
Audit-related services. DoD
competitively awarded 46 new contracts
and orders for audit services that could
be impacted by section 1002 of the
NDAA for FY 2018. Of those new
contracts and orders, 61% were
awarded to 17 unique small business
entities.
Major defense acquisition programs
(MDAPs). The impact to small
businesses resulting from
implementation of sections 832 and 882
of the NDAA for FY 2018 cannot be
assessed, since FPDS does not collect
data for MDAPs or specific acquisition
phases (i.e., engineering and
manufacturing development (EMD)).
Subject matter experts within DoD know
of no instances where the LPTA source
selection process has been used for
procurement of EMD of an MDAP.
This rule does not include any new
reporting, recordkeeping, or other
compliance requirements.
This rule implements the statutory
requirements, as written. There are no
known alternative approaches to the
rule that would meet the stated
objectives of the applicable statutes.
VII. Paperwork Reduction Act
The rule does not contain any
information collection requirements that
VerDate Sep<11>2014
17:19 Sep 25, 2019
Jkt 247001
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 208,
212, 213, 215, 216, 217, 234, and 237
Government procurement.
Jennifer Lee Hawes,
Regulatory Control Officer, Defense
Acquisition Regulations System.
Therefore, 48 CFR parts 208, 212, 213,
215, 216, 217, 234, and 237 are
amended as follows:
■ 1. The authority citation for 48 CFR
parts 208, 212, 213, 215, 216, 217, 234,
and 237 continues to read as follows:
Authority: 41 U.S.C. 1303 and 48 CFR
chapter 1.
PART 208—REQUIRED SOURCES OF
SUPPLIES OR SERVICES
2. Amend section 208.405 by
redesignating the text as paragraph (1)
and adding paragraphs (2) and (3) to
read as follows:
■
(2)(i) Include an evaluation factor
regarding supply chain risk (see subpart
239.73) when acquiring information
technology, whether as a service or as a
supply, that is a covered system, is a
part of a covered system, or is in
support of a covered system, as defined
in 239.7301.
(ii) See 215.101–2–70 for limitations
and prohibitions on the use of the
lowest price technically acceptable
source selection process, which are
applicable to simplified acquisitions.
(iii) See 217.7801 for the prohibition
on the use of reverse auctions for
personal protective equipment and
aviation critical safety items.
PART 215—CONTRACTING BY
NEGOTIATION
5. Add section 215.101–2 heading to
read as follows:
■
215.101–2 Lowest price technically
acceptable source selection process.
6. Add section 215.101–2–70 to read
as follows:
■
208.405 Ordering procedures for Federal
Supply Schedules.
215.101–2–70
prohibitions.
*
The following limitations and
prohibitions apply when considering
the use of the lowest price technically
acceptable source selection procedures.
(a) Limitations.
(1) In accordance with section 813 of
the National Defense Authorization Act
for Fiscal Year 2017 (Pub. L. 114–328)
as amended by section 822 of the
National Defense Authorization Act for
Fiscal Year 2018 (Pub. L. 115–91) (see
10 U.S.C. 2305 note), the lowest price
technically acceptable source selection
process shall only be used when—
(i) Minimum requirements can be
described clearly and comprehensively
and expressed in terms of performance
objectives, measures, and standards that
will be used to determine the
acceptability of offers;
(ii) No, or minimal, value will be
realized from a proposal that exceeds
the minimum technical or performance
requirements;
(iii) The proposed technical
approaches will require no, or minimal,
subjective judgment by the source
selection authority as to the desirability
of one offeror’s proposal versus a
competing proposal;
(iv) The source selection authority has
a high degree of confidence that
reviewing the technical proposals of all
offerors would not result in the
identification of characteristics that
could provide value or benefit;
(v) No, or minimal, additional
innovation or future technological
*
*
*
*
(2) See 215.101–2–70 for the
limitations and prohibitions on the use
of the lowest price technically
acceptable source selection process,
which are applicable to orders placed
under Federal Supply Schedules.
(3) See 217.7801 for the prohibition
on the use of reverse auctions for
personal protective equipment and
aviation critical safety items.
PART 212—ACQUISITION OF
COMMERCIAL ITEMS
3. Add section 212.203 to subpart
212.2 to read as follows:
■
212.203 Procedures for solicitation,
evaluation, and award.
(1) See 215.101–2–70 for the
limitations and prohibitions on the use
of the lowest price technically
acceptable source selection process,
which are applicable to the acquisition
of commercial items.
(2) See 217.7801 for the prohibition
on the use of reverse auctions for
personal protective equipment and
aviation critical safety items.
PART 213—SIMPLIFIED ACQUISITION
PROCEDURES
4. Revise section 213.106–1 to read as
follows:
■
213.106–1
Soliciting competition.
(a) Considerations.
PO 00000
Frm 00078
Fmt 4700
Sfmt 4700
E:\FR\FM\26SER1.SGM
26SER1
Limitations and
khammond on DSKJM1Z7X2PROD with RULES
Federal Register / Vol. 84, No. 187 / Thursday, September 26, 2019 / Rules and Regulations
advantage will be realized by using a
different source selection process;
(vi) Goods to be procured are
predominantly expendable in nature,
are nontechnical, or have a short life
expectancy or short shelf life (See PGI
215.101–2–70(a)(1)(vi) for assistance
with evaluating whether a requirement
satisfies this limitation);
(vii) The contract file contains a
determination that the lowest price
reflects full life-cycle costs (as defined
at FAR 7.101) of the product(s) or
service(s) being acquired (see PGI
215.101–2–70(a)(1)(vii) for information
on obtaining this determination); and
(viii) The contracting officer
documents the contract file describing
the circumstances justifying the use of
the lowest price technically acceptable
source selection process.
(2) In accordance with section 813 of
the National Defense Authorization Act
for Fiscal Year 2017, as amended by
section 822 of the National Defense
Authorization Act for Fiscal Year 2018
(Pub. L. 115–91) (see 10 U.S.C. 2305
note), contracting officers shall avoid, to
the maximum extent practicable, using
the lowest price technically acceptable
source selection process in the case of
a procurement that is predominately for
the acquisition of—
(i) Information technology services,
cybersecurity services, systems
engineering and technical assistance
services, advanced electronic testing, or
other knowledge-based professional
services;
(ii) Items designated by the requiring
activity as personal protective
equipment (except see paragraph (b)(1)
of this section); or
(iii) Services designated by the
requiring activity as knowledge-based
training or logistics services in
contingency operations or other
operations outside the United States,
including in Afghanistan or Iraq.
(b) Prohibitions.
(1) In accordance with section 814 of
the National Defense Authorization Act
for Fiscal Year 2017 as amended by
section 882 of the National Defense
Authorization Act for Fiscal Year 2018
(see 10 U.S.C. 2302 note), contracting
officers shall not use the lowest price
technically acceptable source selection
process to procure items designated by
the requiring activity as personal
protective equipment or an aviation
critical safety item, when the requiring
activity advises the contracting officer
that the level of quality or failure of the
equipment or item could result in
VerDate Sep<11>2014
17:19 Sep 25, 2019
Jkt 247001
combat casualties. See 252.209–7010 for
the definition and identification of
critical safety items.
(2) In accordance with section 832 of
the National Defense Authorization Act
for Fiscal Year 2018 (see 10 U.S.C. 2442
note), contracting officers shall not use
the lowest price technically acceptable
source selection process to acquire
engineering and manufacturing
development for a major defense
acquisition program for which
budgetary authority is requested
beginning in fiscal year 2019.
(3) Contracting officers shall make
award decisions based on best value
factors and criteria, as determined by
the resource sponsor (in accordance
with agency procedures), for an auditing
contract. The use of the lowest price
technically acceptable source selection
process is prohibited (10 U.S.C. 254b).
PART 216—TYPES OF CONTRACTS
7. Amend section 216.505 by—
■ a. Removing paragraphs (1) and (2);
■ b. Adding paragraph (a);
■ c. Adding a paragraph (b) heading:
and
■ d. Adding paragraph (b)(1).
The additions read as follows:
■
216.505
Frm 00079
Fmt 4700
PART 217—SPECIAL CONTRACTING
METHODS
8. Add new subpart 217.78 to read as
follows:
■
217.78—REVERSE AUCTIONS
Sec.
217.7801
Prohibition.
217.78—REVERSE AUCTIONS
217.7801
Prohibition.
In accordance with section 814 of the
National Defense Authorization Act for
Fiscal Year 2017 (Pub. L. 114–328) as
amended by section 882 of the National
Defense Authorization Act for Fiscal
Year 2018 (Pub. L. 115–91) (see 10
U.S.C. 2302 note), contracting officers
shall not use reverse auctions when
procuring items designated by the
requiring activity as personal protective
equipment or an aviation critical safety
item, when the requiring activity
advises the contracting officer that the
level of quality or failure of the
equipment or item could result in
combat casualties. See 252.209–7010 for
the definition and identification of
critical safety items.
PART 234—MAJOR SYSTEM
ACQUISITION
9. Add section 234.005–2 to read as
follows:
■
Ordering.
(a) General.
(6) Orders placed under indefinitedelivery contracts may be issued on DD
Form 1155, Order for Supplies or
Services.
(S–70) Departments and agencies
shall comply with the review, approval,
and reporting requirements established
in accordance with subpart 217.7 when
placing orders under non-DoD contracts
in amounts exceeding the simplified
acquisition threshold.
(b) Orders under multiple-award
contracts.
(1) Fair opportunity.
(A) See 215.101–2–70 for the
limitations and prohibitions on the use
of the lowest price technically
acceptable source selection process,
which are applicable to orders placed
against multiple award indefinite
delivery contracts.
(B) See 217.7801 for the prohibition
on the use of reverse auctions for
personal protective equipment and
aviation critical safety items.
*
*
*
*
*
PO 00000
50789
Sfmt 4700
234.005–2
Mission-oriented solicitation.
See 215.101–2–70(b)(2) for the
prohibition on the use of the lowest
price technically acceptable source
selection process for engineering and
manufacturing development of a major
defense acquisition program for which
budgetary authority is requested
beginning in fiscal year 2019.
PART 237—SERVICE CONTRACTING
10. Amend section 237.270 by–
a. Redesignating paragraph (a)(2) as
paragraph (a)(3); and
■ b. Adding new paragraph (a)(2) to read
as follows:
■
■
237.270
Acquisition of audit services.
(a) * * *
(2) See 215.101–2–70(b)(3) for the
prohibition on the use of the lowest
price technically acceptable source
selection process when acquiring audit
services.
*
*
*
*
*
[FR Doc. 2019–20557 Filed 9–25–19; 8:45 am]
BILLING CODE 5001–06–P
E:\FR\FM\26SER1.SGM
26SER1
]]>Agencies
[Federal Register Volume 84, Number 187 (Thursday, September 26, 2019)]
[Rules and Regulations]
[Pages 50785-50789]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2019-20557]
=======================================================================
-----------------------------------------------------------------------
DEPARTMENT OF DEFENSE
Defense Acquisition Regulations System
48 CFR Parts 208, 212, 213, 215, 216, 217, 234, and 237
[Docket DARS-2018-0055]
RIN 0750-AJ74
Defense Federal Acquisition Regulation Supplement: Restrictions
on Use of Lowest Price Technically Acceptable Source Selection Process
(DFARS Case 2018-D010)
AGENCY: Defense Acquisition Regulations System, Department of Defense
(DoD).
ACTION: Final rule.
-----------------------------------------------------------------------
SUMMARY: DoD is issuing a final rule amending the Defense Federal
Acquisition Regulation Supplement (DFARS) to implement sections of the
National Defense Authorization Acts for Fiscal Years 2017 and 2018 that
establish limitations and prohibitions on the use of the lowest price
technically acceptable source selection process.
DATES: Effective October 1, 2019.
FOR FURTHER INFORMATION CONTACT: Ms. Carrie Moore, telephone 571-372-
6093.
SUPPLEMENTARY INFORMATION:
I. Background
DoD published a proposed rule in the Federal Register at 83 FR
62550 on December 4, 2018, to implement the limitations and
prohibitions on use of the lowest price technically acceptable (LPTA)
source selection process provided in sections 813, 814, and 892 of the
National Defense Authorization Act (NDAA) for Fiscal Year (FY) 2017
(Pub. L. 114-328) and sections 822, 832, 882, and 1002 of the NDAA for
FY 2018 (Pub. L. 115-91). Sixteen respondents submitted public comments
in response to the proposed rule.
II. Discussion and Analysis
DoD reviewed the public comments in the development of the final
rule. A discussion of the comments is provided as follows:
A. Significant Changes as a Result of Public Comments
No changes from the proposed rule are made in the final rule as a
result of the public comments received.
B. Analysis of Public Comments
1. Support for the Rule
Comment: Several respondents express support for the rule.
Response: DoD acknowledges support for the rule.
2. General Comments
Comment: A respondent expresses concern that the rule will be
interpreted as a complete prohibition on the use of the LPTA source
selection process. The respondent recommends revising the rule to
clarify that use of the process is acceptable and expand on the
circumstances in which it is or is not appropriate for use in
acquisitions.
Response: It is not the intent of the rule to prohibit the use of
the LPTA source selection process. The LPTA source selection process is
a valuable part of the best value continuum and an acceptable and
appropriate source selection approach for many acquisitions. Instead,
the intent of the
[[Page 50786]]
rule is to implement the statutory language, which aims to identify
meaningful circumstances that must exist for an acquisition to use the
LPTA source selection process and certain types of requirements that
will regularly benefit from the use of tradeoff source selection
procedures. If a requirement satisfies the limitations for use of the
LPTA source selection process, then the process may be used as a source
selection approach. Supplemental information to contracting officers on
when and from whom to seek additional guidance on whether a requirement
satisfies the limitations at 215.101-2-70(a)(1) will be published in
the DFARS Procedures, Guidance, and Information (PGI) in conjunction
with this final rule.
Comment: One respondent expresses concern about how the agencies
using fully automated systems to award contracts are going to implement
this rule.
Response: Each Department or agency is required to implement the
requirements of this final rule in its acquisition business processes
and procedures.
Comment: One respondent expresses support for additional training
and guidance that will assist acquisition personnel in making best
value decisions.
Response: Training is readily available to DoD personnel on a
variety of acquisition topics, including best value decisions. Upon
publication of the final rule, the DFARS PGI will be updated to provide
contracting officers with information on when and from whom to seek
additional guidance when acquiring supplies and services that are
impacted by this rule.
3. Expansion of the Applicability of the Rule
Comment: Some respondents recommend applying greater restrictions
on the types of acquisitions that can use the LPTA source selection
process. For example, a respondent suggests revising this rule to only
authorize the use of the LPTA source selection process when acquiring
goods that are predominantly expendable in nature, non-technical, or
have a short shelf life or life expectancy. Another respondent suggests
limiting the use of the LPTA source selection process to only
commercial and commercial-off-the-shelf items valued at or below the
simplified acquisition threshold, while expressly prohibiting its use
for all other requirements.
Response: To ensure that DoD is not denied the benefit of cost and
technical tradeoffs in the source selection process, the rule
identifies meaningful circumstances that must exist for an individual
requirement to use the LPTA source selection process. Each requirement
has a unique set of circumstances that should be considered when
developing a source selection approach. The LPTA source selection
process is a valuable part of the best value continuum and can be used
to facilitate an effective and competitive acquisition approach,
depending on the circumstances of the acquisition. Limiting the use of
the LPTA source selection process to only goods, commercial items under
a specific dollar threshold, or other broadly defined groupings does
not fully consider the circumstances of an individual requirement and
could result in additional and unnecessary time and cost burdens for
both Government and industry.
4. Limitation Criteria at 215.101-2-70(a)(1)
a. Application of Criteria
Comment: Some respondents recommend revising the rule to clarify
whether each limitation listed at 215.101-2-70(a)(1) applies to
supplies, services, or both supplies and services. In particular, a
respondent suggests that the rule text be clarified to ensure that the
limitations at 215.101-2-70(a)(i) through (iv) are applied to both
supplies and services. The respondent also suggests restructuring the
rule text by dividing the limitations into two paragraphs: One
paragraph that identifies the limitations that apply to the acquisition
of supplies, and one that identifies the limitations that apply to the
acquisition of services. In contrast, another respondent expresses
support for retaining the existing structure of the rule.
Response: The statutory language being implemented by the rule does
not categorize the limitations into those that apply to supplies or
services. As a result, the list of limitations at 215.101-2-70(a)(1)(i)
through (viii) is written to apply to any acquisition that utilizes the
LPTA source selection process. In consideration of these limitations,
the contracting officer must document the contract file with a
description of the circumstances that justify the use of the LPTA
source selection process.
One exception is the limitation at 215.101-2-70(a)(1)(vi), which
implements paragraph (a)(3) of section 822 of the NDAA for FY 2018 that
states the limitation is ``with respect to a contract for the
procurement of goods;'' as such, this rule specifically identifies that
goods must meet this limitation.
b. Additional Criteria
Comment: Some respondents suggest that additional criteria be added
to the list of limitations in order to satisfy Congressional intent.
Specifically, one respondent suggests that ``non-complex'' be added to
the additional criteria for goods at 215.101-2-70(a)(1)(vi). The
respondent also suggests adding another factor to the list that
expressly limits the use of LPTA source selection procedures to
procurements where the risk of unsuccessful performance is minimal.
Response: The intent of this rule is to implement the statutory
language, which does not include ``non-complex'' as a criteria to meet
when purchasing goods, or a limitation on acceptable performance risk,
when using the LPTA source selection process. Comprehensively, the
consideration of each limitation at 215.101-2-70(a)(1) provides an
effective evaluation of a requirement's suitability to use of the LPTA
source selection process and reflects the intent of the statutory
language; therefore, no additional limitation criteria are included in
this final rule.
c. Clarification of Terms
Comment: Some respondents indicate that the terms used in the rule
are unclear. Specifically, one respondent suggests modifying paragraph
215.101-2-70(a)(1)(ii) to expressly state that ``value'' includes both
qualitative and quantitative value to be realized by DoD. Another
respondent advises that it is unclear what ``full life-cycle costs''
means when acquiring services.
Response: Supplemental guidance will be published in DFARS PGI in
conjunction with this final rule to assist contracting officers in
documenting the contract file with a determination that the lowest
price reflects full life-cycle costs. The term ``value'' includes
monetary and non-monetary benefits, as applicable to the requirement.
The term also considers whether DoD is willing to pay more than a
minimum price in return for non-monetary benefits (e.g., greater
functionality, higher performance, or lower performance risk). The rule
does not place any limitations on the meaning of the term.
d. Documentation of Justification
Comment: A respondent expresses concern that this rule requires a
written justification when using the LPTA source selection process. As
acquisition planning already requires the contracting officer to
document the acquisition process and the rationale behind the decision
to use one process
[[Page 50787]]
or method over another, the respondent views the documentation required
by this rule to be unnecessary. In contrast, another respondent
suggests that this rule expand the documentation requirement to include
a description and analysis of the all the requirements at 215.101-2-
70(a)(1) in order to justify the use of the LPTA source selection
process and require the justification to be posted with the
solicitation.
Response: This rule implements statutory language that requires a
contracting officer document the contract file with the circumstances
justifying the use of the LPTA source selection process. The rule does
not specify a format or method to be used to meet this statutory
requirement. The appropriate format of the justification and the method
of incorporation into the contract file is left to the discretion of
each Department or agency. When developing a source selection approach,
acquisition personnel consider the unique circumstances of a
requirement and determine the method that will result in the best value
to DoD. Publicizing the justification with the solicitation is not
required by statute and could result in increased cost and time burden
to both Government and industry.
5. List of Services and Supplies at 215.101-2-70(a)(2)
Comment: A respondent suggests that the rule specify how a
contracting officer determines that a procurement is predominately for
a specific category of service.
Response: For solicitation and reporting purposes, contracting
officers assign each acquisition a product or service code that best
represents the predominant dollar amount of supplies or services being
procured on an award. This code will determine whether the acquisition
is subject to the limitations at 215.101-2-70(a)(2).
Comment: A respondent recommends that the list include services
directly related to national security, in order to implement the intent
of Congress.
Response: The intent of this rule is to implement the requisite
statutory language, which does not include ``services directly related
to national security'' in the list of service categories that must
avoid using the LPTA source selection process, to the maximum extent
practicable; as such, the rule text does not include such services in
215.101-2-70(a)(2)(i).
Comment: A respondent suggests that the list of services at
215.101-2-70(a)(2)(i) expressly include advisory and assistance
services, as the term ``knowledge-based professional services'' may be
misinterpreted to not include advisory and assistance services.
Response: The intent of this rule is to implement the requisite
statutory language, which does not explicitly include advisory and
assistance services; therefore, the rule text does not identify
advisory and assistance services in 215.101-2-70(a)(2)(1).
Comment: Section 880(c) of the NDAA for FY 2019 restricts civilian
agencies from using the LPTA source selection process for procurements
that are predominately for the same services listed at 215.101-2-
70(a)(2)(i), and also includes ``health care services and records'' and
``telecommunication devices and services'' to the list. To harmonize
the requirements between the FAR and the DFARS or comply with statute,
a couple of respondents suggest the rule incorporate the two additional
categories from section 880(c) into the restrictions at 215-101-2-
70(a)(2).
Response: The intent of this rule is to implement the statutes at
sections 813, 814, and 892 of the NDAA for FY 2017, and sections 822,
832, 882, and 1002 of the NDAA for FY 2018. Section 880 of the NDAA for
FY 2019 is being implemented via FAR case 2018-016, Lowest Price
Technically Acceptable Source Selection Process, and does not apply to
DoD.
6. Suggestion for Technical Edit
Comment: One respondent suggests that the two sentences regarding
audit services at 215.101-2-70(b)(3) be reversed to state the
prohibition upfront and follow with how award decisions shall be made
for such services.
Response: The primary intent of the text, as arranged, is to
address the action a contracting officer shall take when awarding an
auditing contract; therefore, no change is made to the final rule.
C. Other Changes
An editorial change was made to the rule to update the reference at
213.106-1(a)(2)(ii) from 215.101-70 to 215.101-2-70.
III. 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 create any new DFARS clauses or amend any
existing DFARS clauses.
IV. 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.
V. Executive Order 13771
This final rule is not subject to E.O. 13771, because this rule is
not a significant regulatory action under E.O. 12866.
VI. Regulatory Flexibility Act
This rule primarily affects the internal Government procedures,
including requirements determination and acquisition strategy
decisions, and contract file documentation requirements. However, a
final regulatory flexibility analysis (FRFA) has been prepared
consistent with the Regulatory Flexibility Act, 5 U.S.C. 601, et seq.
The FRFA is summarized as follows:
DoD is amending the Defense Federal Acquisition Regulation
Supplement (DFARS) to implement sections of the National Defense
Authorization Act (NDAA) for Fiscal Year (FY) 2017 (Pub. L. 114-328)
and the NDAA for FY 2018 (Pub. L. 115-91). These sections establish a
preference for the use of the tradeoff source selection process for
certain safety items and auditing services; prohibit the use of reverse
auctions or the lowest price technically acceptable (LPTA) source
selection process for specific supplies and services; and specify
criteria for the use of the LPTA source selection process.
No public comments were received in response to the initial
regulatory flexibility analysis.
DoD does not have information on the total number of solicitations
issued on an annual basis that specified the use of the LPTA source
selection process, or the number or description of small entities that
are impacted by certain solicitations. However, the Federal Procurement
Data System (FPDS) provides the following information for fiscal year
2016:
DoD competitive contracts using FAR part 15 procedures. DoD awarded
18,361 new contracts and orders using competitive negotiated
procedures, of
[[Page 50788]]
which 47% were awarded to 5,221 unique small business entities. It is
important to note that FPDS does not collect data on the source
selection process used for a solicitation. Therefore, this data
includes competitive solicitations using LPTA or tradeoff source
selection processes, which will be subject to future considerations and
restrictions provided by section 813 of the NDAA for FY 2017 and
section 822 of the NDAA for FY 2018.
Personal protective equipment. DoD competitively awarded 9,130 new
contracts and orders potentially for combat-related personal protective
equipment items that could be impacted by restrictions in section 814
of the NDAA for FY 2017. Of those new contracts and orders, 89% were
awarded to 668 unique small business entities.
Aviation critical safety items. As discussed during the rulemaking
process for DFARS clause 252.209-7010 published in the Federal Register
at 76 FR 14641 on March 17, 2011, the identification of aviation
critical safety items occurs entirely outside of the procurement
process and is not captured in FPDS. Therefore, it is not possible for
DoD to assess the impact of section 814 of the NDAA for FY 2017, as
amended by 822 of the NDAA for FY 2018 on small business entities.
Audit-related services. DoD competitively awarded 46 new contracts
and orders for audit services that could be impacted by section 1002 of
the NDAA for FY 2018. Of those new contracts and orders, 61% were
awarded to 17 unique small business entities.
Major defense acquisition programs (MDAPs). The impact to small
businesses resulting from implementation of sections 832 and 882 of the
NDAA for FY 2018 cannot be assessed, since FPDS does not collect data
for MDAPs or specific acquisition phases (i.e., engineering and
manufacturing development (EMD)). Subject matter experts within DoD
know of no instances where the LPTA source selection process has been
used for procurement of EMD of an MDAP.
This rule does not include any new reporting, recordkeeping, or
other compliance requirements.
This rule implements the statutory requirements, as written. There
are no known alternative approaches to the rule that would meet the
stated objectives of the applicable statutes.
VII. 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 208, 212, 213, 215, 216, 217, 234,
and 237
Government procurement.
Jennifer Lee Hawes,
Regulatory Control Officer, Defense Acquisition Regulations System.
Therefore, 48 CFR parts 208, 212, 213, 215, 216, 217, 234, and 237
are amended as follows:
0
1. The authority citation for 48 CFR parts 208, 212, 213, 215, 216,
217, 234, and 237 continues to read as follows:
Authority: 41 U.S.C. 1303 and 48 CFR chapter 1.
PART 208--REQUIRED SOURCES OF SUPPLIES OR SERVICES
0
2. Amend section 208.405 by redesignating the text as paragraph (1) and
adding paragraphs (2) and (3) to read as follows:
208.405 Ordering procedures for Federal Supply Schedules.
* * * * *
(2) See 215.101-2-70 for the limitations and prohibitions on the
use of the lowest price technically acceptable source selection
process, which are applicable to orders placed under Federal Supply
Schedules.
(3) See 217.7801 for the prohibition on the use of reverse auctions
for personal protective equipment and aviation critical safety items.
PART 212--ACQUISITION OF COMMERCIAL ITEMS
0
3. Add section 212.203 to subpart 212.2 to read as follows:
212.203 Procedures for solicitation, evaluation, and award.
(1) See 215.101-2-70 for the limitations and prohibitions on the
use of the lowest price technically acceptable source selection
process, which are applicable to the acquisition of commercial items.
(2) See 217.7801 for the prohibition on the use of reverse auctions
for personal protective equipment and aviation critical safety items.
PART 213--SIMPLIFIED ACQUISITION PROCEDURES
0
4. Revise section 213.106-1 to read as follows:
213.106-1 Soliciting competition.
(a) Considerations.
(2)(i) Include an evaluation factor regarding supply chain risk
(see subpart 239.73) when acquiring information technology, whether as
a service or as a supply, that is a covered system, is a part of a
covered system, or is in support of a covered system, as defined in
239.7301.
(ii) See 215.101-2-70 for limitations and prohibitions on the use
of the lowest price technically acceptable source selection process,
which are applicable to simplified acquisitions.
(iii) See 217.7801 for the prohibition on the use of reverse
auctions for personal protective equipment and aviation critical safety
items.
PART 215--CONTRACTING BY NEGOTIATION
0
5. Add section 215.101-2 heading to read as follows:
215.101-2 Lowest price technically acceptable source selection
process.
0
6. Add section 215.101-2-70 to read as follows:
215.101-2-70 Limitations and prohibitions.
The following limitations and prohibitions apply when considering
the use of the lowest price technically acceptable source selection
procedures.
(a) Limitations.
(1) In accordance with section 813 of the National Defense
Authorization Act for Fiscal Year 2017 (Pub. L. 114-328) as amended by
section 822 of the National Defense Authorization Act for Fiscal Year
2018 (Pub. L. 115-91) (see 10 U.S.C. 2305 note), the lowest price
technically acceptable source selection process shall only be used
when--
(i) Minimum requirements can be described clearly and
comprehensively and expressed in terms of performance objectives,
measures, and standards that will be used to determine the
acceptability of offers;
(ii) No, or minimal, value will be realized from a proposal that
exceeds the minimum technical or performance requirements;
(iii) The proposed technical approaches will require no, or
minimal, subjective judgment by the source selection authority as to
the desirability of one offeror's proposal versus a competing proposal;
(iv) The source selection authority has a high degree of confidence
that reviewing the technical proposals of all offerors would not result
in the identification of characteristics that could provide value or
benefit;
(v) No, or minimal, additional innovation or future technological
[[Page 50789]]
advantage will be realized by using a different source selection
process;
(vi) Goods to be procured are predominantly expendable in nature,
are nontechnical, or have a short life expectancy or short shelf life
(See PGI 215.101-2-70(a)(1)(vi) for assistance with evaluating whether
a requirement satisfies this limitation);
(vii) The contract file contains a determination that the lowest
price reflects full life-cycle costs (as defined at FAR 7.101) of the
product(s) or service(s) being acquired (see PGI 215.101-2-
70(a)(1)(vii) for information on obtaining this determination); and
(viii) The contracting officer documents the contract file
describing the circumstances justifying the use of the lowest price
technically acceptable source selection process.
(2) In accordance with section 813 of the National Defense
Authorization Act for Fiscal Year 2017, as amended by section 822 of
the National Defense Authorization Act for Fiscal Year 2018 (Pub. L.
115-91) (see 10 U.S.C. 2305 note), contracting officers shall avoid, to
the maximum extent practicable, using the lowest price technically
acceptable source selection process in the case of a procurement that
is predominately for the acquisition of--
(i) Information technology services, cybersecurity services,
systems engineering and technical assistance services, advanced
electronic testing, or other knowledge-based professional services;
(ii) Items designated by the requiring activity as personal
protective equipment (except see paragraph (b)(1) of this section); or
(iii) Services designated by the requiring activity as knowledge-
based training or logistics services in contingency operations or other
operations outside the United States, including in Afghanistan or Iraq.
(b) Prohibitions.
(1) In accordance with section 814 of the National Defense
Authorization Act for Fiscal Year 2017 as amended by section 882 of the
National Defense Authorization Act for Fiscal Year 2018 (see 10 U.S.C.
2302 note), contracting officers shall not use the lowest price
technically acceptable source selection process to procure items
designated by the requiring activity as personal protective equipment
or an aviation critical safety item, when the requiring activity
advises the contracting officer that the level of quality or failure of
the equipment or item could result in combat casualties. See 252.209-
7010 for the definition and identification of critical safety items.
(2) In accordance with section 832 of the National Defense
Authorization Act for Fiscal Year 2018 (see 10 U.S.C. 2442 note),
contracting officers shall not use the lowest price technically
acceptable source selection process to acquire engineering and
manufacturing development for a major defense acquisition program for
which budgetary authority is requested beginning in fiscal year 2019.
(3) Contracting officers shall make award decisions based on best
value factors and criteria, as determined by the resource sponsor (in
accordance with agency procedures), for an auditing contract. The use
of the lowest price technically acceptable source selection process is
prohibited (10 U.S.C. 254b).
PART 216--TYPES OF CONTRACTS
0
7. Amend section 216.505 by--
0
a. Removing paragraphs (1) and (2);
0
b. Adding paragraph (a);
0
c. Adding a paragraph (b) heading: and
0
d. Adding paragraph (b)(1).
The additions read as follows:
216.505 Ordering.
(a) General.
(6) Orders placed under indefinite-delivery contracts may be issued
on DD Form 1155, Order for Supplies or Services.
(S-70) Departments and agencies shall comply with the review,
approval, and reporting requirements established in accordance with
subpart 217.7 when placing orders under non-DoD contracts in amounts
exceeding the simplified acquisition threshold.
(b) Orders under multiple-award contracts.
(1) Fair opportunity.
(A) See 215.101-2-70 for the limitations and prohibitions on the
use of the lowest price technically acceptable source selection
process, which are applicable to orders placed against multiple award
indefinite delivery contracts.
(B) See 217.7801 for the prohibition on the use of reverse auctions
for personal protective equipment and aviation critical safety items.
* * * * *
PART 217--SPECIAL CONTRACTING METHODS
0
8. Add new subpart 217.78 to read as follows:
217.78--REVERSE AUCTIONS
Sec.
217.7801 Prohibition.
217.78--REVERSE AUCTIONS
217.7801 Prohibition.
In accordance with section 814 of the National Defense
Authorization Act for Fiscal Year 2017 (Pub. L. 114-328) as amended by
section 882 of the National Defense Authorization Act for Fiscal Year
2018 (Pub. L. 115-91) (see 10 U.S.C. 2302 note), contracting officers
shall not use reverse auctions when procuring items designated by the
requiring activity as personal protective equipment or an aviation
critical safety item, when the requiring activity advises the
contracting officer that the level of quality or failure of the
equipment or item could result in combat casualties. See 252.209-7010
for the definition and identification of critical safety items.
PART 234--MAJOR SYSTEM ACQUISITION
0
9. Add section 234.005-2 to read as follows:
234.005-2 Mission-oriented solicitation.
See 215.101-2-70(b)(2) for the prohibition on the use of the lowest
price technically acceptable source selection process for engineering
and manufacturing development of a major defense acquisition program
for which budgetary authority is requested beginning in fiscal year
2019.
PART 237--SERVICE CONTRACTING
0
10. Amend section 237.270 by-
0
a. Redesignating paragraph (a)(2) as paragraph (a)(3); and
0
b. Adding new paragraph (a)(2) to read as follows:
237.270 Acquisition of audit services.
(a) * * *
(2) See 215.101-2-70(b)(3) for the prohibition on the use of the
lowest price technically acceptable source selection process when
acquiring audit services.
* * * * *
[FR Doc. 2019-20557 Filed 9-25-19; 8:45 am]
BILLING CODE 5001-06-P
