General Services Administration Acquisition Regulation; Submission for OMB Review; Transactional Data Reporting, 51573-51578 [2019-21254]
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Federal Register / Vol. 84, No. 189 / Monday, September 30, 2019 / Notices
Mr.
Matthew McFarland, Office of
Acquisition Policy, 301–758–5880 or
matthew.mcfarland@gsa.gov.
SUPPLEMENTARY INFORMATION:
FOR FURTHER INFORMATION CONTACT:
GENERAL SERVICES
ADMINISTRATION
[OMB Control No. 3090–0306; Docket No.
2019–0001; Sequence No. 4]
General Services Administration
Acquisition Regulation; Submission
for OMB Review; Transactional Data
Reporting
Office of Acquisition Policy,
General Services Administration (GSA).
ACTION: Notice of request for comments
regarding an extension to an existing
OMB clearance.
AGENCY:
Under the provisions of the
Paperwork Reduction Act, the
Regulatory Secretariat Division is
submitting a request to the Office of
Management and Budget (OMB) to
review and approve an extension of a
previously approved information
collection requirement regarding
General Services Administration
Acquisition Regulation (GSAR) clauses
related to Transactional Data Reporting.
GSA uses this information to establish
price reasonableness on certain
Government-wide contracts, inform
category management activities, collect
fees due from buying agencies, and
administer the respective programs.
DATES: Submit comments on or before:
October 30, 2019.
ADDRESSES: Submit comments
identified by Information Collection
3090–0306, Transactional Data
Reporting, by any of the following
methods:
• Regulations.gov: https://
www.regulations.gov. Submit comments
via the Federal eRulemaking portal by
searching the OMB control number.
Select the link ‘‘Submit a Comment’’
that corresponds with ‘‘Information
Collection 3090–0306, Transactional
Data Reporting.’’ Follow the instructions
provided at the ‘‘Submit a Comment’’
screen. Please include your name,
company name (if any), and
‘‘Information Collection 3090–0306,
Transactional Data Reporting’’ on your
attached document.
• Mail: General Services
Administration, Regulatory Secretariat
Division (MVCB), 1800 F Street NW,
Washington, DC 20405. ATTN: Ms.
Mandell/IC 3090–0306, Transactional
Data Reporting.
Instructions: Please submit comments
only and cite Information Collection
3090–0306, Transactional Data
Reporting, in all correspondence related
to this collection. All comments
received will be posted without change
to https://www.regulations.gov, including
any personal and/or business
confidential information provided.
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SUMMARY:
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A. Purpose
Transactional data is generated when
a transaction is made between a buyer
and seller and shows details of
transactions at the line-item level, such
as descriptions, quantities, and the
prices paid for the items purchased. The
Government is increasingly using this
data to gain insight into its purchasing
patterns, allowing it to identify the most
efficient solutions, channels, and
sources to meet its mission critical
needs. This data is particularly critical
to the Government’s use of category
management, the business practice of
buying common goods and services as
an enterprise to eliminate redundancies,
increase efficiency, and deliver more
value and savings from acquisition
programs. Moreover, individual buyers
benefit from this data when conducting
market research, price analysis, and
negotiations.
Transactional data is typically
possessed by the buyer and seller in a
transaction. On the Government (buyer)
side, this data is often found in contract
writing systems and financial systems.
However, these systems are not shared
across agencies; in fact, some agencies
use multiple versions of these systems.
Hence, no mechanism currently exists
to compile and analyze transactional
data from a wide-range of purchases
made across the Government.
GSA sought to improve the
Government’s access to this data
through the Transactional Data
Reporting (TDR) final rule, published on
June 23, 2016.1 The rule amended the
General Services Administration
Acquisition Regulation (GSAR) by
establishing two contract clauses
requiring contractors to report
transactional data from orders placed
against GSA’s Government-wide
contract vehicles:
• Alternate I of GSAR clause
552.238–80 Industrial Funding Fee and
Sales Reporting has been introduced to
the Federal Supply Schedule (FSS)
program on a pilot basis, along with
corresponding reductions to existing
pricing disclosure requirements.
• GSAR clause 552.216–75
Transactional Data Reporting is
applicable to GSA’s Government-wide
Acquisition Contract (GWAC) and other
Government-wide indefinite-delivery
indefinite-quantity (IDIQ) contract
1 See GSAR Case 2013–G504; Docket 2014–0020;
Sequence 1 [81 FR 41104 (June 23, 2016)].
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51573
vehicles established after June 23,
2016.2 As of May 2019, Alliant 2
(unrestricted) is the only vehicle in this
class that has been required to, and is
using, the TDR clause.
This information collection primarily
applies to GSA’s FSS contracts,
commonly known as GSA Schedules or
Multiple Award Schedules (MAS).
These Government-wide contracts
provide federal agencies with a
simplified process for acquiring
commercial supplies and services. The
GSA FSS program is the Government’s
preeminent commercial contracting
vehicle, accounting for about 10 percent
of all federal contract dollars with
approximately $33 billion of purchases
made through the program in fiscal year
2018.
GSA establishes the pricing and terms
of each GSA Schedule contract with its
contract holders. Federal agencies then
follow GSA’s competitive procedures
when placing orders against these
contracts and thereby satisfy statutory
competition requirements to provide
‘‘the lowest overall cost alternative to
meet the needs of the Federal
Government.’’ 3 In turn, those agencies
must pay an Industrial Funding Fee
(IFF) that covers GSA’s costs of
operating the FSS program. The fee is
currently set at 0.75 percent and is
included in the prices ordering
activities pay contractors when
purchasing from an FSS contract.4 FSS
contractors then report GSA Schedule
sales data and remit the IFF collected
from ordering activities to GSA once a
quarter.
There were a total of 16,215 FSS
contracts in fiscal year 2018. This
information collection pertains to the
2,063 contracts that participated in the
TDR pilot. The remaining 14,152
contracts are subject to legacy sales
reporting requirements and pricing
disclosure requirements associated with
Commercial Sales Practices (CSP) and
GSAR clause 552.238–81 Price
Reductions, otherwise known as the
Price Reductions Clause (PRC); those
requirements are accounted for under
separate information collection
identified by OMB control number
3090–0235.5
2 The rule does not apply to FSS contracts
administered by the Department of Veterans Affairs.
3 41 U.S.C. 152(3)(B) requires FSS ordering
procedures to ‘‘result in the lowest overall cost
alternative to meet the needs of the Federal
Government.’’
4 The IFF for Schedule 599, Special Item Number
599–2 is $1.50 per transaction.
5 The PRC was formerly found at GSAR 552.238–
75 but was amended to GSAR 552.238–81 per
GSAR case 2016–G502, effective May 23, 2019. See
84 FR 17030 from April 23, 2019.
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GSA believes TDR offers a meaningful
burden reduction for FSS contractors.
GSA estimates the combined burden of
this information collection is 50 percent
less per contract than the legacy sales
reporting requirements and CSP and
PRC disclosures associated with OMB
control number 3090–0235. GSA
estimates if all FSS contractors
participated in TDR, they would realize
an estimated annual burden reduction
of $64.6 million.6 On the other hand,
GSA estimates ending the FSS pilot will
cost participating contractors nearly
$22.6 million and GSA approximately
$3 million to transition to the legacy
sales reporting and CSP and PRC
disclosure requirements unless an
alternate method is created to collect the
IFF, monitor program sales and
establish and monitor contract pricing.7
The Paperwork Reduction Act
generally requires information
collections to be renewed every three
years.8 Both this information collection
(OMB control number 3090–0306) and
the information collection associated
with legacy sales reporting and CSP and
PRC disclosure requirements (OMB
control number 3090–0235) were last
approved in 2016, so GSA is now
obtaining extensions to both
information collections.9
6 The estimated burden for this information
collection, which applied to the 14,152 contracts
not participating in the TDR pilot, is estimated to
be $128 million. This equates to a per-contract
burden of $9,049/year. The estimated burden for the
TDR information collection is $9.2 million/year for
the 2,063 contracts participating in the FSS pilot;
this equates to a per-contract the burden of $4,483/
year. The estimated $64.6 million/year burden
reduction is calculated by taking the updated 3090–
0235 burden estimate ($128 million/year) and
subtracting the product of the number of contracts
included in 3090–0235 multiplied by the average
per-contract burden of TDR (14,152 contracts ×
$4,483), which equals $63.4 million/year
($128M¥$63.4M = $64.6M). More information
about the FSS Pricing Disclosures and Sales
Reporting can be found under Information
Collection 3090–0235 at https://www.reginfo.gov/
public by searching ‘‘ICR’’ for ‘‘3090–0235’’.
7 Vendors transitioning back to the CSP/PRC
framework would have to submit CSPs to establish
basis of award pricing. As of December 2018, 2,158
contractors were participating in the TDR pilot.
Using the framework for new offer CSPs in this
information collection, 2,158 new offer CSPs would
equate to a burden of $19.5 million. This same
framework would show increased costs of $3
million for GSA to process 2,158 new offer CSPs.
Additionally, these contractors would also need to
establish sales tracking systems to comply with the
sales reporting requirements of the basic version of
GSAR clause 552.238–80. Using the sales reporting
cost estimation framework for establishing new
systems from OMB control number 3090–0235, this
would cost these contractors $3.1 million.
8 44 U.S.C. 3507(g).
9 GSA is consolidating a separate information
collection for IFF and sales reporting (OMB control
number 3090–0121) with the pricing disclosures
information collection (OMB control number 3090–
0235) because the burdens are interdependent.
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This request for comments only
pertains to the information collection
requirements associated with TDR
(OMB control number 3090–0306). GSA
has also published a separate notice
requesting comments on the information
collection associated with legacy sales
reporting and CSP and PRC disclosure
requirements (OMB control number
3090–0235) elsewhere in this issue of
the Federal Register.
Information Collection Changes and
Updates
Adjustments for Actual Number of
Contracts: The TDR pilot had yet to
launch when these burden estimates
were previously calculated in 2016, so
GSA based its estimates for the number
of contracts that would participate on
the total number of contracts under the
Schedules and Special Item Numbers
eligible for the pilot:
• The ratio of GSA Schedule
contracts that would continue to require
legacy sales reporting and CSP and PRC
disclosures was estimated to be 56.8
percent, which was based on the
percentage of the program’s sales in
fiscal year 2015 for contracts that would
not be eligible to participate in the TDR
pilot.
• The ratio of GSA Schedule
contracts slated to be included in the
TDR pilot was estimated to account for
the remaining 43.2 percent.
However, pilot participation became
optional in 2017 and the number of
contracts that eventually joined the pilot
was far lower than anticipated in 2016.
Of the 16,215 contracts that were active
in FY 2018—
• 14,152 contracts, or 87.28 percent of
the total, were required to conduct
legacy sales reporting and provide CSP
and PRC disclosures.
• 2,063 contracts, or 12.72 percent of
the total, participated in the TDR pilot.
Additionally, only one non-FSS
contract vehicle, Alliant 2
(unrestricted), currently uses the nonFSS TDR clause. The last revision of
these burden estimates relied upon the
total number of non-FSS contracts (537)
that would be eligible had they been
awarded after the TDR rule was
promulgated. As a result, the number of
non-FSS contracts was lowered from
537 to the actual number of contracts
using the applicable clause, 53.
Accordingly, the revised participation
figures resulted in significantly lower
burden estimates for this information
collection. On the other hand, the FSS
pilot participation revisions resulted in
significantly higher burden estimates for
the information collection accounting
for CSP and PRC disclosures and legacy
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sales reporting (OMB Control Number
3090–0235).
Revised Labor Rates: The previous
burden estimates used a fully burdened
labor rate of $68/hour. This included a
$50/hour base rate, which was based on
professional judgment, and 36 percent
for fringe benefits, which was rounded
down from the 36.25 percent fringe
benefit factor included in OMB Circular
A–76. The revised burden estimates
attempt to align with the Department of
Defense’s Regulatory Cost Analysis Tool
(RCAT), which was developed to
prepare economic analyses in
compliance with Executive Order 13771
and uses various Government labor
category rates as the basis for cost
estimates. As such, GSA determined—
• The GS–12, Step 5 labor rate from
the RCAT ($55.19/hour) was the most
appropriate for the tasks performed by
contractors to comply with monthly
reporting requirements; and
• The GS–14, Step 5 labor rate from
the RCAT ($77.25/hour) was the most
appropriate for the tasks performed by
contractors to comply with the initial
setup.
B. Annual Reporting Burden
This information collection applies to
GSA FSS contracts that include GSAR
clauses 552.216–75 Transactional Data
Reporting and 552.238–80 Industrial
Funding Fee and Sales Reporting,
Alternate I. In FY 2018, contractors held
53 Alliant 2 contracts subject to clause
552.216–75 and 2,063 GSA FSS
contracts subject to Alternate I of GSAR
clause 552.238–80.
Both clauses require contractors to
report the data elements outlined in
each clause, such as item descriptions
and prices paid, to a GSA website. This
data must be reported monthly within
30 calendar days after the end of each
calendar month, meaning contractors
will furnish 12 reports over the course
of a year for each contract containing
one of these clauses. Vendors also remit
applicable fees, such as the IFF for
Schedule contracts, when submitting
these reports.
Cost Burden Calculation
The two primary activities associated
with this information collection are the
initial setup and monthly reporting.
GSA calculated the cost burden for each
as follows:
• Initial Setup: The duties required
for these activities will generally be
completely by a senior-level subject
matter expert. For the purposes of
establishing an hourly rate, GSA equates
these duties to those of a GS–14, Step
5 employee, whose hourly rate in 2019
for the ‘‘Rest of U.S.’’ locality is $56.92
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an hour.10 When factoring a 36.25
percent overhead rate for fringe benefits,
the fully burdened rate is $77.55 an
hour.11
• Quarterly Reporting: The duties
required for these activities will
generally be completed by mid-level
personnel. For the purposes of
establishing an hourly rate, GSA equates
these duties to those of a GS–12, Step
5 employee, whose hourly rate in 2019
for the ‘‘Rest of U.S.’’ locality is $40.51
an hour. When factoring a 36.25 percent
overhead rate for fringe benefits, the
fully burdened rate is $55.19 an hour.
Categorization of Vendors by Monthly
Sales Revenue: TDR imposes a
progressive burden—one that increases
with a contractor’s sales volume.
Monthly reporting times increase with a
contractor’s applicable sales volume, as
contractors with lower to no reportable
sales spend relatively little time on
monthly reporting, while those with
more reportable sales with face a higher
reporting burden.
GSA separated contractors into
categories based on annual sales volume
in order to account for the differences in
reporting burden. These categories are:
• Category 1: No sales activity (annual
of $0)
• Category 2: Annual sales between $0
and $25,000
• Category 3: Annual sales between
$25,000 and $250,000
• Category 4: Annual sales between
$250,000 and $1 million
• Category 5: Annual sales over $1
million
The distribution of contractors by
sales category is as follows:
FSS AND NON-FSS VENDORS BY SALES CATEGORY
FSS vendors
(count)
Category
Category
Category
Category
Category
1
2
3
4
5
FSS vendors
(percentage)
Non-FSS
vendors
(count)
Non-FSS
vendors
(percentage)
Total vendor
count by
category
...........................................................................
...........................................................................
...........................................................................
...........................................................................
...........................................................................
318
197
619
407
522
15
10
30
20
25
37
0
0
2
14
70
0
0
4
26
355
197
619
409
536
Total ..............................................................................
2,063
100
53
100
2,116
Automated vs. Manual Reporting
Systems: Vendors subject to these
clauses must create systems or processes
to produce and report accurate data.
Generally, contractors will use
automated or manual systems to
identify the transactional data to be
reported each month. An automated
system is one that relies on information
technology, such as an accounting
system or data management software, to
identify and compile reportable data.
These systems can tremendously
streamline the reporting process but
require upfront configuration to perform
the tasks, such as coding the data
elements to be retrieved. Conversely, a
manual system is one that incorporates
little to no automation and instead relies
on personnel to manually identify and
compile the reportable data. An
example of a manual system would be
an accountant reviewing invoices to
identify the reportable data and then
transferring the findings to a
spreadsheet. In contrast to automation,
a manual system requires relatively
little setup time but the reporting effort
will generally increase with the
contractor’s sales volume.
The likelihood of a contractor
adopting an automated system increases
with their applicable sales volume.
Vendors with little to no reportable data
are unlikely to expend the effort needed
to establish an automated reporting
system since it will be relatively easy to
identify and report a limited amount of
data. In fiscal year 2018, 15 percent of
FSS contracts in the TDR pilot had $0
sales, while another 10 percent reported
annual sales between $1 and $25,000
per month. However, as a contractor’s
applicable average monthly sales
increase, it will be increasingly likely to
establish an automated system to reduce
the monthly reporting burden.
Consequently, contractors with higher
reportable sales will likely bear a higher
setup burden to create an automated
system, or absorb a high monthly
reporting burden if they choose to rely
on manual reporting methods.
The following chart depicts the
likelihood of the current population
adopting manual and automated
reporting systems:
VENDORS BY REPORTING SYSTEM TYPE (MANUAL VS. AUTOMATED)
Manual
system
(percentage)
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Category
Category
Category
Category
Category
1
2
3
4
5
Automated
system
(percentage)
Manual
system—
vendor count
Automated
system—
vendor count
.......................................................................................................
.......................................................................................................
.......................................................................................................
.......................................................................................................
.......................................................................................................
100
100
90
50
10
0
0
10
50
90
355
197
557
205
54
0
0
62
205
482
Total Count of Vendors by System Type .................................................
........................
........................
1,367
749
10 General Schedule (GS) labor rates may be
viewed on the Office of Personnel Management
(OPM) under Pay & Leave: Salaries and Wages,
SALARY TABLE 2019–RUS at https://
www.opm.gov/policy-data-oversight/pay-leave/
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salaries-wages/salary-tables/19Tables/html/RUS_
h.aspx.
11 36.25% overhead rate was used in reference to
Office of Management and Budget (OMB) Circular
No. A–76. Circular A–76 requires agencies to use
standard cost factors to estimate certain costs of
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Government performance. These cost factors ensure
that specific government costs are calculated in a
standard and consistent manner to reasonably
reflect the cost of performing commercial activities
with government personnel.
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VENDORS BY REPORTING SYSTEM TYPE (MANUAL VS. AUTOMATED)—Continued
Percentage of Vendors by System Type ........................................................
Manual
system
(percentage)
Automated
system
(percentage)
........................
........................
for all pilot contracts (64% manual,
36% automated). The initial setup
burden for those contracts is illustrated
below:
Initial Setup
Annual Burden (Hours): 34,412
Annual Burden (Cost): $2,668,613
Transactional data was reported for
2,063 FSS contracts in FY 2018. As
previously noted, the reporting burden
for contractors using manual systems
increases with their reported sales,
while the reporting burden for
contractors using automated systems
remains constant regardless of the
reported sales volume. The reporting
burden for those contracts is illustrated
below:
Quarterly Reporting
Annual Burden (Hours): 119,207
Annual Burden (Cost): $6,579,023
Non-FSS Burden Estimates: The only
non-FSS contract vehicle currently
using the clause is the Alliant 2
unrestricted contract. 53 Alliant 2
contracts were awarded in FY 2018,
meaning each of the contract holders
incurred initial setup costs. The initial
setup burden was split between manual
and automated systems, the number of
which was estimated based on the ratio
for the Alliant 2 contracts (74% manual,
26% automated). The initial setup
burden for those contracts is illustrated
below:
Initial Setup
Annual Burden (Hours): 3,672
Annual Burden (Cost): $284,764
As previously noted, the reporting
burden for contractors using manual
MONTHLY REPORTING HOURS BY
systems increases with their reported
sales while the reporting burden for
SYSTEM TYPE AND CATEGORY
contractors using automated systems
Manual
Automated
remains constant regardless of the
systems
systems
reported sales volume. The reporting
burden for those contracts is as follows:
Category 1 ........
0.25
2.00
Category 2 ........
2.00
2.00 Quarterly Reporting
Annual Burden (Hours): 1,445
Category 3 ........
4.00
2.00
Annual Burden (Cost): $79,772
Category 4 ........
16.00
2.00
Initial Setup: Vendors complying with
this rule will absorb a one-time setup
burden to establish reporting systems.
The estimated setup time varies
between automated and manual
reporting systems. Vendors
implementing a manual system must
acclimate themselves with the new
reporting requirements and train their
staff accordingly, while those with
automated systems must perform these
tasks in addition to configuring
information technology resources. GSA
estimates the average one-time setup
burden is 8 hours for contractors with
a manual system and 240 hours for
those with an automated system.
Monthly Reporting: After initial setup,
contractors subject to these clauses are
required to report sales within 30
calendar days after the end of each
calendar month. The average reporting
times vary by system type (manual or
automated) and by sales categories. GSA
estimates contractors using a manual
system will have average monthly
reporting times ranging from 15 minutes
(0.25 hours) for contractors with $0
sales to an average of 48 hours for
contractors with monthly sales over $1
million. On the other hand, GSA
projects contractors with automated
systems will have reporting times of 2
hours per month, irrespective of
monthly sales volume, as a result of
efficiencies achieved through automated
processes. The following table shows
GSA’s projected monthly reporting
times per sales category and system
type:
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Category 5 ........
48.00
2.00
FSS Burden Estimates: A total of 376
FSS contracts joined the TDR pilot in
FY 2018, including 139 newly awarded
contracts and 237 existing contracts that
voluntarily joined the pilot. The initial
setup burden was split between manual
and automated systems, the number of
which was estimated based on the ratio
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Total Annual Burden
The total estimated burden imposed
by TDR is as follows:
Estimated Annual Time Burden (Hours)
FSS Vendors: 153,619
Non-FSS Vendors: 5,117
Total Annual Time Burden: 158,736
Estimated Annual Cost Burden
FSS Vendors: $9,247,636
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Manual
system—
vendor count
65
Automated
system—
vendor count
35
Non-FSS Vendors: $364,535
Total Annual Cost Burden: $9,612,171
C. Public Comments
An initial notice of request for
comments regarding the extension of
this information collection was
published in the Federal Register at 84
FR 24512 on May 28, 2019. GSA sought
comments regarding (1) whether this
information collection is necessary and
has practical utility, and (2) if GSA’s
estimate of the collection burden is
accurate, and based on valid
assumptions and methodology. In
response, GSA received comment letters
from immixGroup, Inc. (immixGroup),
the GSA Office of Inspector General
(GSA OIG, and the Coalition for
Government Procurement (The
Coalition).
immixGroup’s letter, dated July 24,
2019, addressed this information
collection. The GSA OIG’s letter, dated
July 26, 2019, expressly provided
comments for this information
collection and the FSS Pricing
Disclosures and Sales Reporting
information collection (OMB control
number 3090–0235). The Coalition’s
letter, dated July 29, 2019, is limited to
this information collection, although
they provided a separate letter with
comments on the FSS Pricing
Disclosures and Sales Reporting
information collection (OMB control
number 3090–0235). GSA is providing
responses to FSS Pricing Disclosures
and Sales Reporting in documents
associated with the extension of that
information collection (OMB control
number 3090–0235).
The following are summaries of the
respondents’ comments related to this
information collection, grouped by
subject matter, and GSA’s responses:
Burden Estimates
Comments: immixGroup and the
Coalition commented on GSA’s burden
estimates. immixGroup stated the initial
setup took about half the time estimated
by GSA and noted it takes them four
hours to complete monthly reporting
requirements. The Coalition, on the
other hand, stated three of GSA’s
reporting burden assumptions are
invalid—
• The monthly reporting burden for
TDR is largely alleviated through
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automated systems: The Coalition stated
they conducted a survey among their
members in 2015 and the respondents,
all of which would fall into GSA’s
Category 5 of contractors (Schedule
sales over $1 million), estimated the
monthly reporting burden to be 68
hours, even when using automated
systems.
• Contractor employees responsible
for the initial setup are paid at a fully
burdened labor rate of $77.55/hour: The
Coalition estimated this cost to be an
average of $140/hour.
• The number of companies accepting
TDR will remain constant year to year:
The Coalition noted GSA is currently
consolidating the Schedules into a
single solicitation; if the current scope
of the pilot remains unchanged, this
would allow almost 400 more
contractors to join the pilot.
GSA Response: GSA believes its
burden estimates are valid and the
comments underscore the fact that the
burden varies widely by contractor,
which is why GSA separated the
reporting burden by sales volume and
reporting system (automated vs.
manual).
GSA’s estimates for the automated
and manual categories are intended to
be an average within that category. For
example, immixGroup holds 2 of the 12
pilot contracts with FY 2018 sales
exceeding $100 million, while the other
510 contracts under Category 5 each had
less than $100 million in sales,
including 172 contracts with sales
between $1 million and $2 million. GSA
believes a contractor with sales similar
to those of immixGroup would have a
reporting burden toward the higher end
of the population of Category 5
contractors. Likewise, GSA believes
some contractors will have a higher
reporting burden than that shared by
immixGroup, such as those reported by
the Coalition’s members in 2015, but
GSA also estimates most Category 5
contractors using automated systems
will have a lower burden. Consequently,
GSA believes its estimate is
representative of the average Category 5
reporting burden.
GSA also believes the labor rates
provided by the Coalition are
significantly higher than those typically
paid by contractors to fulfill these
functions. GSA believes these functions
are typically performed by accounting
staff with occasional assistance from
higher-paid professionals, such as
attorneys and consultants. The most
comparable labor category for the
accounting staff analyzed by the Bureau
of Labor Statistics (BLS) are accountants
and auditors (13–2011). BLS’s most
recently published mean hourly rate for
VerDate Sep<11>2014
19:16 Sep 27, 2019
Jkt 247001
this category was $37.89/hour; 12 when
factoring a 36.25 percent overhead rate
for fringe benefits, the fully burdened
rate is $51.63 an hour.13 However, GSA
chose to use the higher $77.55/hour rate
to account for the occasional
involvement of higher-paid
professionals.
Finally, GSA acknowledges pilot
participation may increase by the
number of contractors estimated by the
Coalition, but also notes that it is
difficult to forecast future pilot
participation because it is uncertain
how many of those contractors would
join the pilot if given the opportunity.
On the other hand, a historical average
would be skewed because most pilot
contractors joined within the pilot’s first
year. As a result, the number of
contractors that joined the pilot in the
last fiscal year (FY 2018) is the most
representative figure to use for the
current burden estimate.
TDR Pilot Continuation
Comments: The GSA OIG questioned
why GSA is continuing the TDR pilot
beyond FY 2019, stating GSA has yet to
include transactional data in its pricing
analyses and decisions and TDR has yet
to have an impact on order-level
outcomes. Conversely, the Coalition and
immixGroup stated TDR is less
burdensome than CSP and PRC
disclosures and reverting back to CSP
and PRC disclosures if the TDR pilot is
discontinued would be extremely
burdensome.
GSA Response: GSA’s premise has
been TDR can meet or exceed the CSP
and PRC’s value while supporting better
buying outcomes and reducing
contractor reporting burden. Two-thirds
of the way through the pilot, TDR has
proven to be a less burdensome
alternative, has had no adverse impact
on contract-level pricing, and is starting
to be used by contracting officers and
category managers to improve buying
outcomes. Accordingly, GSA has
decided to continue the pilot through
FY 2020 while it focuses on
consolidating all 24 Schedules into one
single Schedule. This decision removes
uncertainty for contract partners and
allows them to plan accordingly.
12 See the Bureau of Labor Statistics Occupational
Employment and Wages for Compliance Officers,
available at https://www.bls.gov/oes/current/
oes132011.htm.
13 36.25% overhead rate was used in reference to
Office of Management and Budget (OMB) Circular
No. A–76. Circular A–76 requires agencies to use
standard cost factors to estimate certain costs of
Government performance. These cost factors ensure
that specific government costs are calculated in a
standard and consistent manner to reasonably
reflect the cost of performing commercial activities
with government personnel.
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Frm 00070
Fmt 4703
Sfmt 4703
51577
TDR Alternatives
Comments: immixGroup stated
neither TDR or the Price Reductions
clause (PRC) and Commercial Sales
Practices (CSP) have much utility when
technology enables the acquisition
workforce to comparison shop and
review pricing data, but applauds GSA
for moving to TDR in lieu of the more
burdensome legacy PRC and CSP
requirements.
The Coalition recommends GSA
reduce its reliance on TDR, the PRC and
CSP and instead rely on market
competition to reduce prices. The
Coalition also recommends GSA seek
technological solutions, such investing
in automated systems and upgrading its
existing ordering tools, rather than
relying on a regulatory solution such as
TDR.
Finally, the GSA OIG stated the CSP
and PRC are needed for GSA to meet its
statutory pricing obligations. They
argued TDR ‘‘severs the link to the
commercial marketplace’’ and is
ineffective because it has not met its
stated objectives or effectively replaced
the CSP and PRC as pricing tools.
GSA Responses: GSA believes TDR, in
conjunction with other horizontal
pricing techniques, will be a superior
method of ensuring FSS ordering
procedures ‘‘result in the lowest overall
cost alternative to meet the needs of the
Federal Government,’’ as required by 41
U.S.C. 152(3)(B). To date, the TDR pilot
has lowered industry burden while
maintaining the Schedule pricing
position. Additionally, contracting
officers and category managers are
beginning to use the data and GSA is
continuously improving TDR data
analytics.
Pilot Participation
Comments: immixGroup and the
Coalition commented on pilot
participation. immixGroup stated the
pilot is more popular than the
participation figures indicate because
only certain Special Item Numbers are
eligible for the pilot. Additionally, the
Coalition recommended ‘‘that GSA
provide TDR as an option for all
Schedule holders, in place of PRC
compliance and submission of the CSP,
so that each contractor has the
opportunity to make a business decision
about the least burdensome, least costly,
and most efficient compliance
mechanism under the Schedules
program.’’
GSA Response: GSA has decided to
extend the TDR pilot through FY 2020
while maintaining the current scope.
This will enable GSA to focus on
consolidating all 24 Schedules into one
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51578
Federal Register / Vol. 84, No. 189 / Monday, September 30, 2019 / Notices
single Schedule and enable contractors
and the GSA acquisition workforce to
spend their resources understanding
and participating in the consolidated
Schedule. Additionally, maintaining the
pilot’s current scope will allow GSA to
understand the implications of the new
consolidated Schedule environment on
TDR.
khammond on DSKJM1Z7X2PROD with NOTICES
The Government Already Possesses the
Data
Comments: immixGroup noted GSA
acknowledges the data it collects
through TDR also exists in Government
contract writing and financial systems
and therefore asked, ‘‘if agencies are
unwilling to share their transactional
data with GSA, how is it that we, as
contractors, should feel comfortable
doing so?’’
The Coalition stated they are ‘‘. . .
concerned that the Government already
possesses the data that it is requesting
through TDR. Furthermore, TDR, which
focuses on transactions for commercial
products, has limited utility for services
and solutions which comprise almost 70
percent of spending under the
Schedules program.’’
GSA Response: Agencies are not
unwilling to share transactional data
with GSA. Instead, a lack of system
interoperability prevents GSA from
harvesting the transactional data
residing on the multitude of contract
writing and financial systems used
across the Government. GSA explored
several alternatives for obtaining
transactional data prior to publishing
the final rule in 2016—internal
applications; GSA ordering platforms
such as eBuy and GSA Advantage!®; the
SmartPay credit card purchase program;
upgrades to the Federal Procurement
Data System; and the Government
electronic invoicing initiative. GSA
concluded in 2016 these options would
not provide the breadth of data needed
to support the Government’s objectives
or would be unable to do so in the
foreseeable future, and this remains the
case in 2019.
In regards to using data from services
and solutions, GSA acknowledges
transactional data is most useful for
price analysis when comparing like
items, but this does not mean the data
is not useful for services and solutions.
Government buyers and FSS contracting
officers will still use the data for price
analysis and market research, and
category managers will use the data for
consumption analysis to form demand
management strategies, regardless of
whether the data can be used for perfect
comparisons. An example is the ability
to compare labor rates across contract
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19:16 Sep 27, 2019
Jkt 247001
vehicles, which is beginning to reduce
contract duplication.
Data Usage
Comments: The Coalition and
immixGroup expressed concern that
transactional data will lead ordering
contracting officers to always expect the
lowest price paid by the Government,
regardless of the terms, quantities
purchased, or other circumstances that
affect the prices offered on those orders.
The Coalition also stated a lowest price
expectation may cause the Government
to favor cheaper products IT products
that are more susceptible to cyber risks.
With respect to order-level price
negotiations, the Coalition
recommended the Government
standardize the way it conducts
horizontal price comparisons because
they are concerned there will be ‘‘wide
variations in practices for horizontal
price comparisons across, and even
within, agencies. This lack of
consistency will increase contract
administration costs for industry.’’
Regarding contract-level price
negotiations, the Coalition stated, ‘‘GSA
should acknowledge that while
negotiating Schedule contracts the terms
and conditions of the order will dictate
the price.’’
Finally, the Coalition stated GSA
should provide agencies guidance on
gray market and counterfeit items,
which could be low-price outliers and
skew price comparisons.
GSA Response: Contracting officers
will continue to conduct acquisitions in
accordance with the Federal Acquisition
Regulation, which states a preference for
‘‘best value’’ solutions.14 Moreover,
GSA instructs its contracting officers to
take into account whether the data is
current, the terms and conditions of the
acquisition related to the prices paid,
quantities purchased, and other material
factors affecting the prices paid, such as
blanket purchase agreements, temporary
price reductions/promotional prices,
and differing labor qualifications.
Regarding gray market and counterfeit
items, transactional data prevents,
rather than promotes, procurement of
these items, as the data helps GSA
identify and subsequently remove these
items from the Schedules marketplace.
Finally, additional public comments
are particularly invited on: Whether this
collection of information is necessary
and whether it will have practical
utility; whether our estimate of the
public burden of this collection of
information is accurate, and based on
valid assumptions and methodology;
14 Federal Acquisition Regulation section 1.102
(48 CFR 1.102).
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Frm 00071
Fmt 4703
Sfmt 4703
ways to enhance the quality, utility, and
clarity of the information to be
collected.
Obtaining Copies of Proposals:
Requesters may obtain a copy of the
information collection documents from
the General Services Administration,
Regulatory Secretariat Division (MVCB),
1800 F Street NW, Washington, DC
20405, telephone 202–501–4755. Please
cite Information Collection 3090–0306,
Transactional Data Reporting, in all
correspondence.
Jeffrey A. Koses,
Senior Procurement Executive, Office of
Acquisition Policy, Office of Governmentwide Policy.
[FR Doc. 2019–21254 Filed 9–27–19; 8:45 am]
BILLING CODE 6820–61–P
GENERAL SERVICES
ADMINISTRATION
[OMB Control No. 3090–0235; Docket No.
2019–0001; Sequence No. 1]
General Services Administration
Acquisition Regulation; Submission
for OMB Review; Federal Supply
Schedule Pricing Disclosures and
Sales Reporting
Office of Acquisition Policy,
General Services Administration (GSA).
ACTION: Notice of request for comments
regarding an extension to an existing
OMB clearance.
AGENCY:
Under the provisions of the
Paperwork Reduction Act, the
Regulatory Secretariat Division is
submitting a request to the Office of
Management and Budget (OMB) to
review and approve an extension of a
previously approved information
collection requirement regarding
Commercial Sales Practices disclosures
and the General Services
Administration Acquisition Regulation
(GSAR) clause regarding price
reductions. The information collected is
used to establish and maintain Federal
Supply Schedule (FSS) pricing and
price-related terms and conditions. The
extension has been renamed ‘‘Federal
Supply Schedule Pricing Disclosures
and Sales Reporting’’ because it now
includes a burden estimate associated
with the basic version of the GSAR
clause regarding industrial funding fee
and sales reporting. GSA uses this
information to collect the Industrial
Funding Fee and administer the FSS
program. This burden was included
under a separate approved information
collection identified by OMB control
number 3090–0121.
SUMMARY:
E:\FR\FM\30SEN1.SGM
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]]>Agencies
[Federal Register Volume 84, Number 189 (Monday, September 30, 2019)]
[Notices]
[Pages 51573-51578]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2019-21254]
[[Page 51573]]
=======================================================================
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GENERAL SERVICES ADMINISTRATION
[OMB Control No. 3090-0306; Docket No. 2019-0001; Sequence No. 4]
General Services Administration Acquisition Regulation;
Submission for OMB Review; Transactional Data Reporting
AGENCY: Office of Acquisition Policy, General Services Administration
(GSA).
ACTION: Notice of request for comments regarding an extension to an
existing OMB clearance.
-----------------------------------------------------------------------
SUMMARY: Under the provisions of the Paperwork Reduction Act, the
Regulatory Secretariat Division is submitting a request to the Office
of Management and Budget (OMB) to review and approve an extension of a
previously approved information collection requirement regarding
General Services Administration Acquisition Regulation (GSAR) clauses
related to Transactional Data Reporting. GSA uses this information to
establish price reasonableness on certain Government-wide contracts,
inform category management activities, collect fees due from buying
agencies, and administer the respective programs.
DATES: Submit comments on or before: October 30, 2019.
ADDRESSES: Submit comments identified by Information Collection 3090-
0306, Transactional Data Reporting, by any of the following methods:
Regulations.gov: https://www.regulations.gov. Submit
comments via the Federal eRulemaking portal by searching the OMB
control number. Select the link ``Submit a Comment'' that corresponds
with ``Information Collection 3090-0306, Transactional Data
Reporting.'' Follow the instructions provided at the ``Submit a
Comment'' screen. Please include your name, company name (if any), and
``Information Collection 3090-0306, Transactional Data Reporting'' on
your attached document.
Mail: General Services Administration, Regulatory
Secretariat Division (MVCB), 1800 F Street NW, Washington, DC 20405.
ATTN: Ms. Mandell/IC 3090-0306, Transactional Data Reporting.
Instructions: Please submit comments only and cite Information
Collection 3090-0306, Transactional Data Reporting, in all
correspondence related to this collection. All comments received will
be posted without change to https://www.regulations.gov, including any
personal and/or business confidential information provided.
FOR FURTHER INFORMATION CONTACT: Mr. Matthew McFarland, Office of
Acquisition Policy, 301-758-5880 or [email protected].
SUPPLEMENTARY INFORMATION:
A. Purpose
Transactional data is generated when a transaction is made between
a buyer and seller and shows details of transactions at the line-item
level, such as descriptions, quantities, and the prices paid for the
items purchased. The Government is increasingly using this data to gain
insight into its purchasing patterns, allowing it to identify the most
efficient solutions, channels, and sources to meet its mission critical
needs. This data is particularly critical to the Government's use of
category management, the business practice of buying common goods and
services as an enterprise to eliminate redundancies, increase
efficiency, and deliver more value and savings from acquisition
programs. Moreover, individual buyers benefit from this data when
conducting market research, price analysis, and negotiations.
Transactional data is typically possessed by the buyer and seller
in a transaction. On the Government (buyer) side, this data is often
found in contract writing systems and financial systems. However, these
systems are not shared across agencies; in fact, some agencies use
multiple versions of these systems. Hence, no mechanism currently
exists to compile and analyze transactional data from a wide-range of
purchases made across the Government.
GSA sought to improve the Government's access to this data through
the Transactional Data Reporting (TDR) final rule, published on June
23, 2016.\1\ The rule amended the General Services Administration
Acquisition Regulation (GSAR) by establishing two contract clauses
requiring contractors to report transactional data from orders placed
against GSA's Government-wide contract vehicles:
---------------------------------------------------------------------------
\1\ See GSAR Case 2013-G504; Docket 2014-0020; Sequence 1 [81 FR
41104 (June 23, 2016)].
---------------------------------------------------------------------------
Alternate I of GSAR clause 552.238-80 Industrial Funding
Fee and Sales Reporting has been introduced to the Federal Supply
Schedule (FSS) program on a pilot basis, along with corresponding
reductions to existing pricing disclosure requirements.
GSAR clause 552.216-75 Transactional Data Reporting is
applicable to GSA's Government-wide Acquisition Contract (GWAC) and
other Government-wide indefinite-delivery indefinite-quantity (IDIQ)
contract vehicles established after June 23, 2016.\2\ As of May 2019,
Alliant 2 (unrestricted) is the only vehicle in this class that has
been required to, and is using, the TDR clause.
---------------------------------------------------------------------------
\2\ The rule does not apply to FSS contracts administered by the
Department of Veterans Affairs.
---------------------------------------------------------------------------
This information collection primarily applies to GSA's FSS
contracts, commonly known as GSA Schedules or Multiple Award Schedules
(MAS). These Government-wide contracts provide federal agencies with a
simplified process for acquiring commercial supplies and services. The
GSA FSS program is the Government's preeminent commercial contracting
vehicle, accounting for about 10 percent of all federal contract
dollars with approximately $33 billion of purchases made through the
program in fiscal year 2018.
GSA establishes the pricing and terms of each GSA Schedule contract
with its contract holders. Federal agencies then follow GSA's
competitive procedures when placing orders against these contracts and
thereby satisfy statutory competition requirements to provide ``the
lowest overall cost alternative to meet the needs of the Federal
Government.'' \3\ In turn, those agencies must pay an Industrial
Funding Fee (IFF) that covers GSA's costs of operating the FSS program.
The fee is currently set at 0.75 percent and is included in the prices
ordering activities pay contractors when purchasing from an FSS
contract.\4\ FSS contractors then report GSA Schedule sales data and
remit the IFF collected from ordering activities to GSA once a quarter.
---------------------------------------------------------------------------
\3\ 41 U.S.C. 152(3)(B) requires FSS ordering procedures to
``result in the lowest overall cost alternative to meet the needs of
the Federal Government.''
\4\ The IFF for Schedule 599, Special Item Number 599-2 is $1.50
per transaction.
---------------------------------------------------------------------------
There were a total of 16,215 FSS contracts in fiscal year 2018.
This information collection pertains to the 2,063 contracts that
participated in the TDR pilot. The remaining 14,152 contracts are
subject to legacy sales reporting requirements and pricing disclosure
requirements associated with Commercial Sales Practices (CSP) and GSAR
clause 552.238-81 Price Reductions, otherwise known as the Price
Reductions Clause (PRC); those requirements are accounted for under
separate information collection identified by OMB control number 3090-
0235.\5\
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\5\ The PRC was formerly found at GSAR 552.238-75 but was
amended to GSAR 552.238-81 per GSAR case 2016-G502, effective May
23, 2019. See 84 FR 17030 from April 23, 2019.
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[[Page 51574]]
GSA believes TDR offers a meaningful burden reduction for FSS
contractors. GSA estimates the combined burden of this information
collection is 50 percent less per contract than the legacy sales
reporting requirements and CSP and PRC disclosures associated with OMB
control number 3090-0235. GSA estimates if all FSS contractors
participated in TDR, they would realize an estimated annual burden
reduction of $64.6 million.\6\ On the other hand, GSA estimates ending
the FSS pilot will cost participating contractors nearly $22.6 million
and GSA approximately $3 million to transition to the legacy sales
reporting and CSP and PRC disclosure requirements unless an alternate
method is created to collect the IFF, monitor program sales and
establish and monitor contract pricing.\7\
---------------------------------------------------------------------------
\6\ The estimated burden for this information collection, which
applied to the 14,152 contracts not participating in the TDR pilot,
is estimated to be $128 million. This equates to a per-contract
burden of $9,049/year. The estimated burden for the TDR information
collection is $9.2 million/year for the 2,063 contracts
participating in the FSS pilot; this equates to a per-contract the
burden of $4,483/year. The estimated $64.6 million/year burden
reduction is calculated by taking the updated 3090-0235 burden
estimate ($128 million/year) and subtracting the product of the
number of contracts included in 3090-0235 multiplied by the average
per-contract burden of TDR (14,152 contracts x $4,483), which equals
$63.4 million/year ($128M-$63.4M = $64.6M). More information about
the FSS Pricing Disclosures and Sales Reporting can be found under
Information Collection 3090-0235 at https://www.reginfo.gov/public by
searching ``ICR'' for ``3090-0235''.
\7\ Vendors transitioning back to the CSP/PRC framework would
have to submit CSPs to establish basis of award pricing. As of
December 2018, 2,158 contractors were participating in the TDR
pilot. Using the framework for new offer CSPs in this information
collection, 2,158 new offer CSPs would equate to a burden of $19.5
million. This same framework would show increased costs of $3
million for GSA to process 2,158 new offer CSPs. Additionally, these
contractors would also need to establish sales tracking systems to
comply with the sales reporting requirements of the basic version of
GSAR clause 552.238-80. Using the sales reporting cost estimation
framework for establishing new systems from OMB control number 3090-
0235, this would cost these contractors $3.1 million.
---------------------------------------------------------------------------
The Paperwork Reduction Act generally requires information
collections to be renewed every three years.\8\ Both this information
collection (OMB control number 3090-0306) and the information
collection associated with legacy sales reporting and CSP and PRC
disclosure requirements (OMB control number 3090-0235) were last
approved in 2016, so GSA is now obtaining extensions to both
information collections.\9\
---------------------------------------------------------------------------
\8\ 44 U.S.C. 3507(g).
\9\ GSA is consolidating a separate information collection for
IFF and sales reporting (OMB control number 3090-0121) with the
pricing disclosures information collection (OMB control number 3090-
0235) because the burdens are interdependent.
---------------------------------------------------------------------------
This request for comments only pertains to the information
collection requirements associated with TDR (OMB control number 3090-
0306). GSA has also published a separate notice requesting comments on
the information collection associated with legacy sales reporting and
CSP and PRC disclosure requirements (OMB control number 3090-0235)
elsewhere in this issue of the Federal Register.
Information Collection Changes and Updates
Adjustments for Actual Number of Contracts: The TDR pilot had yet
to launch when these burden estimates were previously calculated in
2016, so GSA based its estimates for the number of contracts that would
participate on the total number of contracts under the Schedules and
Special Item Numbers eligible for the pilot:
The ratio of GSA Schedule contracts that would continue to
require legacy sales reporting and CSP and PRC disclosures was
estimated to be 56.8 percent, which was based on the percentage of the
program's sales in fiscal year 2015 for contracts that would not be
eligible to participate in the TDR pilot.
The ratio of GSA Schedule contracts slated to be included
in the TDR pilot was estimated to account for the remaining 43.2
percent.
However, pilot participation became optional in 2017 and the number
of contracts that eventually joined the pilot was far lower than
anticipated in 2016. Of the 16,215 contracts that were active in FY
2018--
14,152 contracts, or 87.28 percent of the total, were
required to conduct legacy sales reporting and provide CSP and PRC
disclosures.
2,063 contracts, or 12.72 percent of the total,
participated in the TDR pilot.
Additionally, only one non-FSS contract vehicle, Alliant 2
(unrestricted), currently uses the non-FSS TDR clause. The last
revision of these burden estimates relied upon the total number of non-
FSS contracts (537) that would be eligible had they been awarded after
the TDR rule was promulgated. As a result, the number of non-FSS
contracts was lowered from 537 to the actual number of contracts using
the applicable clause, 53.
Accordingly, the revised participation figures resulted in
significantly lower burden estimates for this information collection.
On the other hand, the FSS pilot participation revisions resulted in
significantly higher burden estimates for the information collection
accounting for CSP and PRC disclosures and legacy sales reporting (OMB
Control Number 3090-0235).
Revised Labor Rates: The previous burden estimates used a fully
burdened labor rate of $68/hour. This included a $50/hour base rate,
which was based on professional judgment, and 36 percent for fringe
benefits, which was rounded down from the 36.25 percent fringe benefit
factor included in OMB Circular A-76. The revised burden estimates
attempt to align with the Department of Defense's Regulatory Cost
Analysis Tool (RCAT), which was developed to prepare economic analyses
in compliance with Executive Order 13771 and uses various Government
labor category rates as the basis for cost estimates. As such, GSA
determined--
The GS-12, Step 5 labor rate from the RCAT ($55.19/hour)
was the most appropriate for the tasks performed by contractors to
comply with monthly reporting requirements; and
The GS-14, Step 5 labor rate from the RCAT ($77.25/hour)
was the most appropriate for the tasks performed by contractors to
comply with the initial setup.
B. Annual Reporting Burden
This information collection applies to GSA FSS contracts that
include GSAR clauses 552.216-75 Transactional Data Reporting and
552.238-80 Industrial Funding Fee and Sales Reporting, Alternate I. In
FY 2018, contractors held 53 Alliant 2 contracts subject to clause
552.216-75 and 2,063 GSA FSS contracts subject to Alternate I of GSAR
clause 552.238-80.
Both clauses require contractors to report the data elements
outlined in each clause, such as item descriptions and prices paid, to
a GSA website. This data must be reported monthly within 30 calendar
days after the end of each calendar month, meaning contractors will
furnish 12 reports over the course of a year for each contract
containing one of these clauses. Vendors also remit applicable fees,
such as the IFF for Schedule contracts, when submitting these reports.
Cost Burden Calculation
The two primary activities associated with this information
collection are the initial setup and monthly reporting. GSA calculated
the cost burden for each as follows:
Initial Setup: The duties required for these activities
will generally be completely by a senior-level subject matter expert.
For the purposes of establishing an hourly rate, GSA equates these
duties to those of a GS-14, Step 5 employee, whose hourly rate in 2019
for the ``Rest of U.S.'' locality is $56.92
[[Page 51575]]
an hour.\10\ When factoring a 36.25 percent overhead rate for fringe
benefits, the fully burdened rate is $77.55 an hour.\11\
---------------------------------------------------------------------------
\10\ General Schedule (GS) labor rates may be viewed on the
Office of Personnel Management (OPM) under Pay & Leave: Salaries and
Wages, SALARY TABLE 2019-RUS at https://www.opm.gov/policy-data-oversight/pay-leave/salaries-wages/salary-tables/19Tables/html/RUS_h.aspx.
\11\ 36.25% overhead rate was used in reference to Office of
Management and Budget (OMB) Circular No. A-76. Circular A-76
requires agencies to use standard cost factors to estimate certain
costs of Government performance. These cost factors ensure that
specific government costs are calculated in a standard and
consistent manner to reasonably reflect the cost of performing
commercial activities with government personnel.
---------------------------------------------------------------------------
Quarterly Reporting: The duties required for these
activities will generally be completed by mid-level personnel. For the
purposes of establishing an hourly rate, GSA equates these duties to
those of a GS-12, Step 5 employee, whose hourly rate in 2019 for the
``Rest of U.S.'' locality is $40.51 an hour. When factoring a 36.25
percent overhead rate for fringe benefits, the fully burdened rate is
$55.19 an hour.
Categorization of Vendors by Monthly Sales Revenue: TDR imposes a
progressive burden--one that increases with a contractor's sales
volume. Monthly reporting times increase with a contractor's applicable
sales volume, as contractors with lower to no reportable sales spend
relatively little time on monthly reporting, while those with more
reportable sales with face a higher reporting burden.
GSA separated contractors into categories based on annual sales
volume in order to account for the differences in reporting burden.
These categories are:
Category 1: No sales activity (annual of $0)
Category 2: Annual sales between $0 and $25,000
Category 3: Annual sales between $25,000 and $250,000
Category 4: Annual sales between $250,000 and $1 million
Category 5: Annual sales over $1 million
The distribution of contractors by sales category is as follows:
FSS and Non-FSS Vendors by Sales Category
----------------------------------------------------------------------------------------------------------------
Non-FSS Non-FSS Total vendor
FSS vendors FSS vendors vendors vendors count by
(count) (percentage) (count) (percentage) category
----------------------------------------------------------------------------------------------------------------
Category 1...................... 318 15 37 70 355
Category 2...................... 197 10 0 0 197
Category 3...................... 619 30 0 0 619
Category 4...................... 407 20 2 4 409
Category 5...................... 522 25 14 26 536
-------------------------------------------------------------------------------
Total....................... 2,063 100 53 100 2,116
----------------------------------------------------------------------------------------------------------------
Automated vs. Manual Reporting Systems: Vendors subject to these
clauses must create systems or processes to produce and report accurate
data. Generally, contractors will use automated or manual systems to
identify the transactional data to be reported each month. An automated
system is one that relies on information technology, such as an
accounting system or data management software, to identify and compile
reportable data. These systems can tremendously streamline the
reporting process but require upfront configuration to perform the
tasks, such as coding the data elements to be retrieved. Conversely, a
manual system is one that incorporates little to no automation and
instead relies on personnel to manually identify and compile the
reportable data. An example of a manual system would be an accountant
reviewing invoices to identify the reportable data and then
transferring the findings to a spreadsheet. In contrast to automation,
a manual system requires relatively little setup time but the reporting
effort will generally increase with the contractor's sales volume.
The likelihood of a contractor adopting an automated system
increases with their applicable sales volume. Vendors with little to no
reportable data are unlikely to expend the effort needed to establish
an automated reporting system since it will be relatively easy to
identify and report a limited amount of data. In fiscal year 2018, 15
percent of FSS contracts in the TDR pilot had $0 sales, while another
10 percent reported annual sales between $1 and $25,000 per month.
However, as a contractor's applicable average monthly sales increase,
it will be increasingly likely to establish an automated system to
reduce the monthly reporting burden. Consequently, contractors with
higher reportable sales will likely bear a higher setup burden to
create an automated system, or absorb a high monthly reporting burden
if they choose to rely on manual reporting methods.
The following chart depicts the likelihood of the current
population adopting manual and automated reporting systems:
Vendors by Reporting System Type (Manual vs. Automated)
----------------------------------------------------------------------------------------------------------------
Automated Manual system-- Automated
Manual system system vendor count system--
(percentage) (percentage) vendor count
----------------------------------------------------------------------------------------------------------------
Category 1...................................... 100 0 355 0
Category 2...................................... 100 0 197 0
Category 3...................................... 90 10 557 62
Category 4...................................... 50 50 205 205
Category 5...................................... 10 90 54 482
---------------------------------------------------------------
Total Count of Vendors by System Type....... .............. .............. 1,367 749
---------------------------------------------------------------
[[Page 51576]]
Percentage of Vendors by System Type............ .............. .............. 65 35
----------------------------------------------------------------------------------------------------------------
Initial Setup: Vendors complying with this rule will absorb a one-
time setup burden to establish reporting systems. The estimated setup
time varies between automated and manual reporting systems. Vendors
implementing a manual system must acclimate themselves with the new
reporting requirements and train their staff accordingly, while those
with automated systems must perform these tasks in addition to
configuring information technology resources. GSA estimates the average
one-time setup burden is 8 hours for contractors with a manual system
and 240 hours for those with an automated system.
Monthly Reporting: After initial setup, contractors subject to
these clauses are required to report sales within 30 calendar days
after the end of each calendar month. The average reporting times vary
by system type (manual or automated) and by sales categories. GSA
estimates contractors using a manual system will have average monthly
reporting times ranging from 15 minutes (0.25 hours) for contractors
with $0 sales to an average of 48 hours for contractors with monthly
sales over $1 million. On the other hand, GSA projects contractors with
automated systems will have reporting times of 2 hours per month,
irrespective of monthly sales volume, as a result of efficiencies
achieved through automated processes. The following table shows GSA's
projected monthly reporting times per sales category and system type:
Monthly Reporting Hours by System Type and Category
------------------------------------------------------------------------
Manual Automated
systems systems
------------------------------------------------------------------------
Category 1.................................... 0.25 2.00
Category 2.................................... 2.00 2.00
Category 3.................................... 4.00 2.00
Category 4.................................... 16.00 2.00
Category 5.................................... 48.00 2.00
------------------------------------------------------------------------
FSS Burden Estimates: A total of 376 FSS contracts joined the TDR
pilot in FY 2018, including 139 newly awarded contracts and 237
existing contracts that voluntarily joined the pilot. The initial setup
burden was split between manual and automated systems, the number of
which was estimated based on the ratio for all pilot contracts (64%
manual, 36% automated). The initial setup burden for those contracts is
illustrated below:
Initial Setup
Annual Burden (Hours): 34,412
Annual Burden (Cost): $2,668,613
Transactional data was reported for 2,063 FSS contracts in FY 2018.
As previously noted, the reporting burden for contractors using manual
systems increases with their reported sales, while the reporting burden
for contractors using automated systems remains constant regardless of
the reported sales volume. The reporting burden for those contracts is
illustrated below:
Quarterly Reporting
Annual Burden (Hours): 119,207
Annual Burden (Cost): $6,579,023
Non-FSS Burden Estimates: The only non-FSS contract vehicle
currently using the clause is the Alliant 2 unrestricted contract. 53
Alliant 2 contracts were awarded in FY 2018, meaning each of the
contract holders incurred initial setup costs. The initial setup burden
was split between manual and automated systems, the number of which was
estimated based on the ratio for the Alliant 2 contracts (74% manual,
26% automated). The initial setup burden for those contracts is
illustrated below:
Initial Setup
Annual Burden (Hours): 3,672
Annual Burden (Cost): $284,764
As previously noted, the reporting burden for contractors using
manual systems increases with their reported sales while the reporting
burden for contractors using automated systems remains constant
regardless of the reported sales volume. The reporting burden for those
contracts is as follows:
Quarterly Reporting
Annual Burden (Hours): 1,445
Annual Burden (Cost): $79,772
Total Annual Burden
The total estimated burden imposed by TDR is as follows:
Estimated Annual Time Burden (Hours)
FSS Vendors: 153,619
Non-FSS Vendors: 5,117
Total Annual Time Burden: 158,736
Estimated Annual Cost Burden
FSS Vendors: $9,247,636
Non-FSS Vendors: $364,535
Total Annual Cost Burden: $9,612,171
C. Public Comments
An initial notice of request for comments regarding the extension
of this information collection was published in the Federal Register at
84 FR 24512 on May 28, 2019. GSA sought comments regarding (1) whether
this information collection is necessary and has practical utility, and
(2) if GSA's estimate of the collection burden is accurate, and based
on valid assumptions and methodology. In response, GSA received comment
letters from immixGroup, Inc. (immixGroup), the GSA Office of Inspector
General (GSA OIG, and the Coalition for Government Procurement (The
Coalition).
immixGroup's letter, dated July 24, 2019, addressed this
information collection. The GSA OIG's letter, dated July 26, 2019,
expressly provided comments for this information collection and the FSS
Pricing Disclosures and Sales Reporting information collection (OMB
control number 3090-0235). The Coalition's letter, dated July 29, 2019,
is limited to this information collection, although they provided a
separate letter with comments on the FSS Pricing Disclosures and Sales
Reporting information collection (OMB control number 3090-0235). GSA is
providing responses to FSS Pricing Disclosures and Sales Reporting in
documents associated with the extension of that information collection
(OMB control number 3090-0235).
The following are summaries of the respondents' comments related to
this information collection, grouped by subject matter, and GSA's
responses:
Burden Estimates
Comments: immixGroup and the Coalition commented on GSA's burden
estimates. immixGroup stated the initial setup took about half the time
estimated by GSA and noted it takes them four hours to complete monthly
reporting requirements. The Coalition, on the other hand, stated three
of GSA's reporting burden assumptions are invalid--
The monthly reporting burden for TDR is largely alleviated
through
[[Page 51577]]
automated systems: The Coalition stated they conducted a survey among
their members in 2015 and the respondents, all of which would fall into
GSA's Category 5 of contractors (Schedule sales over $1 million),
estimated the monthly reporting burden to be 68 hours, even when using
automated systems.
Contractor employees responsible for the initial setup are
paid at a fully burdened labor rate of $77.55/hour: The Coalition
estimated this cost to be an average of $140/hour.
The number of companies accepting TDR will remain constant
year to year: The Coalition noted GSA is currently consolidating the
Schedules into a single solicitation; if the current scope of the pilot
remains unchanged, this would allow almost 400 more contractors to join
the pilot.
GSA Response: GSA believes its burden estimates are valid and the
comments underscore the fact that the burden varies widely by
contractor, which is why GSA separated the reporting burden by sales
volume and reporting system (automated vs. manual).
GSA's estimates for the automated and manual categories are
intended to be an average within that category. For example, immixGroup
holds 2 of the 12 pilot contracts with FY 2018 sales exceeding $100
million, while the other 510 contracts under Category 5 each had less
than $100 million in sales, including 172 contracts with sales between
$1 million and $2 million. GSA believes a contractor with sales similar
to those of immixGroup would have a reporting burden toward the higher
end of the population of Category 5 contractors. Likewise, GSA believes
some contractors will have a higher reporting burden than that shared
by immixGroup, such as those reported by the Coalition's members in
2015, but GSA also estimates most Category 5 contractors using
automated systems will have a lower burden. Consequently, GSA believes
its estimate is representative of the average Category 5 reporting
burden.
GSA also believes the labor rates provided by the Coalition are
significantly higher than those typically paid by contractors to
fulfill these functions. GSA believes these functions are typically
performed by accounting staff with occasional assistance from higher-
paid professionals, such as attorneys and consultants. The most
comparable labor category for the accounting staff analyzed by the
Bureau of Labor Statistics (BLS) are accountants and auditors (13-
2011). BLS's most recently published mean hourly rate for this category
was $37.89/hour; \12\ when factoring a 36.25 percent overhead rate for
fringe benefits, the fully burdened rate is $51.63 an hour.\13\
However, GSA chose to use the higher $77.55/hour rate to account for
the occasional involvement of higher-paid professionals.
---------------------------------------------------------------------------
\12\ See the Bureau of Labor Statistics Occupational Employment
and Wages for Compliance Officers, available at https://www.bls.gov/oes/current/oes132011.htm.
\13\ 36.25% overhead rate was used in reference to Office of
Management and Budget (OMB) Circular No. A-76. Circular A-76
requires agencies to use standard cost factors to estimate certain
costs of Government performance. These cost factors ensure that
specific government costs are calculated in a standard and
consistent manner to reasonably reflect the cost of performing
commercial activities with government personnel.
---------------------------------------------------------------------------
Finally, GSA acknowledges pilot participation may increase by the
number of contractors estimated by the Coalition, but also notes that
it is difficult to forecast future pilot participation because it is
uncertain how many of those contractors would join the pilot if given
the opportunity. On the other hand, a historical average would be
skewed because most pilot contractors joined within the pilot's first
year. As a result, the number of contractors that joined the pilot in
the last fiscal year (FY 2018) is the most representative figure to use
for the current burden estimate.
TDR Pilot Continuation
Comments: The GSA OIG questioned why GSA is continuing the TDR
pilot beyond FY 2019, stating GSA has yet to include transactional data
in its pricing analyses and decisions and TDR has yet to have an impact
on order-level outcomes. Conversely, the Coalition and immixGroup
stated TDR is less burdensome than CSP and PRC disclosures and
reverting back to CSP and PRC disclosures if the TDR pilot is
discontinued would be extremely burdensome.
GSA Response: GSA's premise has been TDR can meet or exceed the CSP
and PRC's value while supporting better buying outcomes and reducing
contractor reporting burden. Two-thirds of the way through the pilot,
TDR has proven to be a less burdensome alternative, has had no adverse
impact on contract-level pricing, and is starting to be used by
contracting officers and category managers to improve buying outcomes.
Accordingly, GSA has decided to continue the pilot through FY 2020
while it focuses on consolidating all 24 Schedules into one single
Schedule. This decision removes uncertainty for contract partners and
allows them to plan accordingly.
TDR Alternatives
Comments: immixGroup stated neither TDR or the Price Reductions
clause (PRC) and Commercial Sales Practices (CSP) have much utility
when technology enables the acquisition workforce to comparison shop
and review pricing data, but applauds GSA for moving to TDR in lieu of
the more burdensome legacy PRC and CSP requirements.
The Coalition recommends GSA reduce its reliance on TDR, the PRC
and CSP and instead rely on market competition to reduce prices. The
Coalition also recommends GSA seek technological solutions, such
investing in automated systems and upgrading its existing ordering
tools, rather than relying on a regulatory solution such as TDR.
Finally, the GSA OIG stated the CSP and PRC are needed for GSA to
meet its statutory pricing obligations. They argued TDR ``severs the
link to the commercial marketplace'' and is ineffective because it has
not met its stated objectives or effectively replaced the CSP and PRC
as pricing tools.
GSA Responses: GSA believes TDR, in conjunction with other
horizontal pricing techniques, will be a superior method of ensuring
FSS ordering procedures ``result in the lowest overall cost alternative
to meet the needs of the Federal Government,'' as required by 41 U.S.C.
152(3)(B). To date, the TDR pilot has lowered industry burden while
maintaining the Schedule pricing position. Additionally, contracting
officers and category managers are beginning to use the data and GSA is
continuously improving TDR data analytics.
Pilot Participation
Comments: immixGroup and the Coalition commented on pilot
participation. immixGroup stated the pilot is more popular than the
participation figures indicate because only certain Special Item
Numbers are eligible for the pilot. Additionally, the Coalition
recommended ``that GSA provide TDR as an option for all Schedule
holders, in place of PRC compliance and submission of the CSP, so that
each contractor has the opportunity to make a business decision about
the least burdensome, least costly, and most efficient compliance
mechanism under the Schedules program.''
GSA Response: GSA has decided to extend the TDR pilot through FY
2020 while maintaining the current scope. This will enable GSA to focus
on consolidating all 24 Schedules into one
[[Page 51578]]
single Schedule and enable contractors and the GSA acquisition
workforce to spend their resources understanding and participating in
the consolidated Schedule. Additionally, maintaining the pilot's
current scope will allow GSA to understand the implications of the new
consolidated Schedule environment on TDR.
The Government Already Possesses the Data
Comments: immixGroup noted GSA acknowledges the data it collects
through TDR also exists in Government contract writing and financial
systems and therefore asked, ``if agencies are unwilling to share their
transactional data with GSA, how is it that we, as contractors, should
feel comfortable doing so?''
The Coalition stated they are ``. . . concerned that the Government
already possesses the data that it is requesting through TDR.
Furthermore, TDR, which focuses on transactions for commercial
products, has limited utility for services and solutions which comprise
almost 70 percent of spending under the Schedules program.''
GSA Response: Agencies are not unwilling to share transactional
data with GSA. Instead, a lack of system interoperability prevents GSA
from harvesting the transactional data residing on the multitude of
contract writing and financial systems used across the Government. GSA
explored several alternatives for obtaining transactional data prior to
publishing the final rule in 2016--internal applications; GSA ordering
platforms such as eBuy and GSA Advantage![supreg]; the SmartPay credit
card purchase program; upgrades to the Federal Procurement Data System;
and the Government electronic invoicing initiative. GSA concluded in
2016 these options would not provide the breadth of data needed to
support the Government's objectives or would be unable to do so in the
foreseeable future, and this remains the case in 2019.
In regards to using data from services and solutions, GSA
acknowledges transactional data is most useful for price analysis when
comparing like items, but this does not mean the data is not useful for
services and solutions. Government buyers and FSS contracting officers
will still use the data for price analysis and market research, and
category managers will use the data for consumption analysis to form
demand management strategies, regardless of whether the data can be
used for perfect comparisons. An example is the ability to compare
labor rates across contract vehicles, which is beginning to reduce
contract duplication.
Data Usage
Comments: The Coalition and immixGroup expressed concern that
transactional data will lead ordering contracting officers to always
expect the lowest price paid by the Government, regardless of the
terms, quantities purchased, or other circumstances that affect the
prices offered on those orders. The Coalition also stated a lowest
price expectation may cause the Government to favor cheaper products IT
products that are more susceptible to cyber risks.
With respect to order-level price negotiations, the Coalition
recommended the Government standardize the way it conducts horizontal
price comparisons because they are concerned there will be ``wide
variations in practices for horizontal price comparisons across, and
even within, agencies. This lack of consistency will increase contract
administration costs for industry.'' Regarding contract-level price
negotiations, the Coalition stated, ``GSA should acknowledge that while
negotiating Schedule contracts the terms and conditions of the order
will dictate the price.''
Finally, the Coalition stated GSA should provide agencies guidance
on gray market and counterfeit items, which could be low-price outliers
and skew price comparisons.
GSA Response: Contracting officers will continue to conduct
acquisitions in accordance with the Federal Acquisition Regulation,
which states a preference for ``best value'' solutions.\14\ Moreover,
GSA instructs its contracting officers to take into account whether the
data is current, the terms and conditions of the acquisition related to
the prices paid, quantities purchased, and other material factors
affecting the prices paid, such as blanket purchase agreements,
temporary price reductions/promotional prices, and differing labor
qualifications.
---------------------------------------------------------------------------
\14\ Federal Acquisition Regulation section 1.102 (48 CFR
1.102).
---------------------------------------------------------------------------
Regarding gray market and counterfeit items, transactional data
prevents, rather than promotes, procurement of these items, as the data
helps GSA identify and subsequently remove these items from the
Schedules marketplace.
Finally, additional public comments are particularly invited on:
Whether this collection of information is necessary and whether it will
have practical utility; whether our estimate of the public burden of
this collection of information is accurate, and based on valid
assumptions and methodology; ways to enhance the quality, utility, and
clarity of the information to be collected.
Obtaining Copies of Proposals: Requesters may obtain a copy of the
information collection documents from the General Services
Administration, Regulatory Secretariat Division (MVCB), 1800 F Street
NW, Washington, DC 20405, telephone 202-501-4755. Please cite
Information Collection 3090-0306, Transactional Data Reporting, in all
correspondence.
Jeffrey A. Koses,
Senior Procurement Executive, Office of Acquisition Policy, Office of
Government-wide Policy.
[FR Doc. 2019-21254 Filed 9-27-19; 8:45 am]
BILLING CODE 6820-61-P
