[Federal Register Volume 64, Number 198 (Thursday, October 14, 1999)]
[Notices]
[Pages 55691-55692]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-26802]
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DEPARTMENT OF AGRICULTURE
Commodity Credit Corporation
Total Quality Systems Audit Implementation
AGENCY: Commodity Credit Corporation, USDA.
[[Page 55692]]
ACTION: Notice of institution of ``Total Quality Systems Audit''
program for Commodity Credit Corporation food purchases.
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SUMMARY: Notice is hereby given that, the Commodity Credit Corporation
(CCC) is phasing in the Total Quality Systems Audit (TQSA) program for
CCC's purchases of food for humanitarian food assistance programs. This
program is being implemented to ensure that CCC purchases meet customer
requirements and needs. Vendors offering processed commodities covered
by TQSA for sale to CCC will have to be approved under the TQSA
standards which involve inspecting the vendor's quality control system
and relying on that system to assure the quality of the end product.
TQSA will reduce Government oversight of the commercial sector, but can
increase confidence in the final product. The TQSA program is a fee-
for-service program, and will be primarily administered for CCC by the
Department of Agriculture's Farm Service Agency (FSA) through FSA's
Warehouse Licensing and Examination Division, Kansas City Commodity
Office. All vendors must consult individual procurement announcements
to determine whether their commodity is subject to TQSA procedures.
EFFECTIVE DATE: July 1, 1999.
FOR FURTHER INFORMATION CONTACT: Dean Jensen, Chief, Contract
Management Branch, Procurement and Donations Division, Farm Service
Agency, U.S. Department of Agriculture, STOP 0555, 1400 Independence
Avenue, SW, Washington, DC 20250-0551, telephone (202) 720-2115, fax
(202) 690-1809; or Timothy Mehl, Chief, Warehouse Licensing and
Examination Division, Kansas City Commodity Office, 9200 Ward Parkway,
Kansas City, Missouri 64114, telephone (816) 926-6843, fax (816) 926-
1774.
SUPPLEMENTARY INFORMATION: TQSA is a new method of identifying
suppliers who are considered sufficiently responsible to supply foods
for CCC food purchases. The program relies on audits by FSA of the
vendor's quality control system. Those audits will be conducted against
an established standard. Not all products procured under CCC food
assistance programs will be evaluated using TQSA procedures. Vendors
should consult the applicable commodity purchase announcement,
invitation, Notice to the Trade, or contact the Kansas City Commodity
Office to determine whether their product is covered.
The audit program will be conducted in lieu of or will reduce the
need for traditional full-scale end-item inspections where only the
final product is checked for conformance to product specifications.
Under TQSA suppliers are instead required to establish and maintain a
quality management system that addresses all aspects of production. By
auditing this quality management system, the absolute amount of
Government oversight in this process can be substantially reduced while
increasing confidence in the quality of the final product.
The audit program will apply specific criteria that a supplier must
meet to establish bidder eligibility. During an audit, the supplier's
quality management system will be given a rating of ``meets,''
``partially meets,'' or ``does not meet'' on multiple criteria. Once
all required questions have been addressed by the vendor and the audit
team, a score is generated which will provide FSA with a numerical
rating. FSA will establish the minimum score necessary for bidder
eligibility. If a supplier fails to meet this minimum, they will be
considered ineligible to bid until the score is improved to an
acceptable level. FSA will phase in TQSA requirements on a commodity by
commodity basis, and vendors will be provided sufficient notification
in order to meet TQSA requirements before TQSA compliance is
incorporated in the applicable commodity contract terms.
Also, by reducing Government oversight and approving vendors prior
to awarding contracts, the costs associated with inspecting commodities
procured for food assistance programs can be substantially reduced.
Also, by decreasing the likelihood of product non-conformance and
subsequent rejection, costs associated with reacquiring and replacing
product are further reduced. These cost reductions benefit the food
assistance programs by allowing higher quality products to be procured
more economically.
Annually, more than 825 million pounds of food products valued at
approximately $850 million are purchased by CCC and distributed for use
in domestic and international food assistance programs. CCC and its
suppliers have spent over $5 million annually on inspection of those
products. TQSA aims to reduce the cost of inspection by a minimum of
30-50 percent.
During the initial months that a supplier is subject to TQSA
requirements, they will be required to submit samples to the
appropriate commodity testing laboratory for compliance testing. This
requirement is intended to provide supplemental verification of program
effectiveness and supplier compliance with TQSA. If deemed appropriate
by the contracting office and TQSA staff, the required final product
testing by a third party laboratory may be eliminated or reduced.
The development of TQSA started in 1997, when CCC began a pilot
program to develop a quality management program that would replace
traditional end-item inspection. During the two years of the pilot
program, FSA staff worked with members of academia, industry, and
Government to develop the criteria and determine the effectiveness of
the TQSA program.
Prior to the implementation of the TQSA procedures, CCC relied
almost entirely on end-item inspection to ensure that food purchased
for domestic and international food asistance programs met the needs
and requirements of the program recipients. Traditional statistical
sampling methods and finished product testing gives little
consideration to the conditions under which a product is produced, only
to the characteristics of the final product. This approach only finds
nonconforming product and allows it to be removed from the system, it
does not prevent the nonconformance from occurring which avoids
problems of non-detection that might apply where there was reliance on
end-item inspection.
TQSA is based on the proven premise that product conformance can be
attained by allowing the supplier to define how production, delivery,
and service are handled. USDA's role is to verify that the methods
chosen are effective and meet applicable regulatory and contractual
requirements, and that the supplier adheres to its stated policies and
procedures.
Signed at Washington, DC, on October 6, 1999.
Keith Kelly,
Executive Vice President, Commodity Credit Corporation.
[FR Doc. 99-26802 Filed 10-13-99; 8:45 am]
BILLING CODE 3410-05-P