[Federal Register Volume 64, Number 233 (Monday, December 6, 1999)]
[Proposed Rules]
[Pages 68072-68076]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-31434]
[[Page 68072]]
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DEPARTMENT OF ENERGY
48 CFR Parts 919 and 952
RIN: 1991-AB45
Acquisition Regulations: Mentor-Protege Program
AGENCY: Department of Energy.
ACTION: Notice of Proposed Rulemaking.
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SUMMARY: The Department of Energy (DOE) is proposing to amend its
acquisition regulations to formally encourage DOE prime contractors to
assist small disadvantaged firms certified by the Small Business
Administration under Section 8(a) of the Small Business Act, other
small disadvantaged businesses, Historically Black Colleges and
Universities and other minority institutions of higher learning, and
women-owned small businesses in enhancing their capabilities to perform
contracts and subcontracts for DOE and other Federal agencies. The
program seeks to foster long-term business relationships between DOE
prime contractors and these small business entities and minority
institutions of higher learning and to increase the overall number of
these small business entities and minority institutions that receive
DOE contract and subcontract awards.
DATES: Written comments on the proposed rulemaking must be received on
or before January 5, 2000.
ADDRESSES: Comments (3 copies) should be addressed to, Eugene Tates at
U.S. Department of Energy, Attn. Mentor-Protege Rulemaking, Office of
Small and Disadvantaged Business Utilization, 1000 Independence Avenue,
SW, Washington, DC 20585.
With respect to proposed reporting requirements and the Paperwork
Reduction Act, comments should be addressed to Eugene Tates and to Erik
Godwin, Office of Information and Regulatory Affairs, NEOB-Rm. 10202,
725 17th Street, N.W., Washington, DC 20503.
FOR FURTHER INFORMATION CONTACT: Eugene Tates, Mentor-Protege Program,
U.S. Department of Energy, Office of Small and Disadvantaged Business
Utilization, 1000 Independence Avenue, SW, Washington, DC 20585, (202)
586-4556; or Robert M. Webb, U.S. Department of Energy, Office of
Procurement and Assistance Management, 1000 Independence Avenue, SW,
Washington, DC 20585, (202) 586-8264.
SUPPLEMENTARY INFORMATION:
I. Background.
II. Section By Section Analysis.
III. Procedural Requirements.
A. Review Under Executive Order 12866.
B. Review Under Executive Order 12988.
C. Review Under the Regulatory Flexibility Act.
D. Review Under the Paperwork Reduction Act.
E. Review Under the National Environmental Policy Act.
F. Review Under Executive Order 12612.
G. Review Under the Unfunded Mandates Reform Act of 1995.
H. Treasury and General Government Appropriation Act, 1999.
IV. Opportunity for Public Comment
I. Background
On June 9, 1995 (60 FR 30529), DOE published final guidelines for
its Mentor-Protege Pilot Initiative. The purpose of the Initiative was
to develop a program that encouraged DOE prime contractors to help
energy-related small disadvantaged, 8(a), and women-owned small
businesses in enhancing their business and technical capabilities to
ensure full participation in the mission of DOE. In addition, the
Initiative sought to foster the establishment of long term business
relationships between these small business entities and DOE prime
contractors and to increase the overall number of these small business
entities eligible to receive DOE contract and subcontract awards.
In order to achieve the goal of the Initiative, DOE prime
contractors entered into formal agreements with qualified small
businesses to provide developmental assistance. In many cases, this
assistance has enabled small businesses to benefit from the vast wealth
of knowledge acquired by large, successful firms doing business with
DOE.
The success of the DOE business mentoring relationships and the
continuing need to develop small disadvantaged business, 8(a) firms and
women-owned small businesses capabilities to perform contracts and
subcontracts for DOE has led to the determination to create a permanent
DOE Mentor-Protege Program. The Program will have the same goals and
objectives as the DOE Mentor-Protege Pilot Initiative. Some refinements
have been added to provide additional incentives for prime contractor
participation in the Mentor-Protege Program.
II. Section-by-Section Analysis
This rulemaking proposes to add a new Subpart 919.70 and amend Part
952 of the DEAR to provide a Mentor-Protege Program that assists
qualified small businesses to receive developmental assistance from DOE
prime contractors in order to increase the base of small businesses
eligible to perform DOE contracts and subcontracts.
Proposed section 919.7002 defines which types of entities are
eligible to participate as Protege in the Program. Those entities would
include Historically Black Colleges and Universities and other minority
institutions of higher learning in addition to 8(a) firms, other small
disadvantaged businesses, and women-owned small businesses. Proposed
section 919.7003 provides the DOE's Mentor-Protege Program policy. It
also states that developmental assistance is reimbursable to the Mentor
under DOE cost reimbursement contracts only to the extent that the
costs are otherwise allowable in the performance of identified DOE
contracts. This is an exception to the general rule that DOE will not
reimburse Mentors for providing developmental assistance to Protege,
which is set out in proposed section 919.7004. Proposed section
919.7005 outlines requirements for Mentor eligibility.
Proposed section 919.7006 states the incentives for mentoring firms
under cost-plus award fee contracts. Proposed section 919.7007 outlines
Protege eligibility requirements. Proposed section 919.7008 provides
that selection of a protege is solely at the discretion of the proposed
mentor. Section 919.7009 describes the process by which DOE contractors
may seek to participate in this program as Mentors.
Proposed section 919.7010 provides the minimum requirements of a
proposed Mentor-Protege agreement. Proposed section 919.7011 describes
forms of developmental assistance.
Proposed section 919.7012 describes the review process leading to
the DOE's approval of a proposed Mentor-Protege agreement. Proposed
section 919.7013 describes the various reports that this program
requires. Proposed section 919.7014 provides for the inclusion of a
provision discussing the Mentor-Protege program in all solicitations
with an estimated value in excess of the simplified acquisition
threshold. Proposed section 952.219-XX provides for the inclusion of a
provision discussing the establishment of the Mentor-Protege Program.
III. Procedural Requirements
A. Review Under Executive Order 12866.
Today's regulatory action has been determined not to be a
``significant regulatory action'' under Executive Order 12866,
``Regulatory Planning and
[[Page 68073]]
Review,'' (58 FR 51735, October 4, 1993). Accordingly, this proposed
rule was not subject to review under that Executive Order by the Office
of Information and Regulatory Affairs of the Office of Management and
Budget (OMB).
B. Review Under Executive Order 12988
With respect to the review of existing regulations and the
promulgation of new regulations, section 3(a) of Executive Order 12988,
``Civil Justice Reform,'' 61 FR 4729 (February 7, 1996), imposes on
Executive agencies the general duty to adhere to the following
requirements: (1) Eliminate drafting errors and ambiguity; (2) Write
regulations to minimize litigation and (3) Provide a clear legal
standard for affected conduct rather than a general standard and
promote simplification and burden reduction. With regard to the review
required by section 3(a), section 3(b) of Executive Order 12988
specifically requires that Executive agencies make every reasonable
effort to ensure that the regulation: (1) Clearly specifies the subject
law's preemptive effect, if any, (2) Clearly specifies any effect on
existing Federal law or regulation; (3) Provides a clear legal standard
for affected conduct while promoting simplification and burden
reduction; (4) Specifies the retroactive effect, if any; (5) Adequately
defines key terms; and (6) Addresses other important issues affecting
clarity and general draftsmanship under any guidelines issued by the
Attorney General. Section 3(c) of Executive Order 12988 requires
Executive agencies to review regulations in light of applicable
standards in section 3(a) and section 3(b) to determine whether they
are met or it is unreasonable to meet one or more of them. DOE has
completed the required review and determined that these proposed
regulations meet the relevant standards of Executive Order 12988.
C. Review Under the Regulatory Flexibility Act
This proposed rule has been reviewed under the Regulatory
Flexibility Act of 1980, Public Law 96-354, that requires preparation
of an initial regulatory flexibility analysis for any rule that must be
proposed for public comment and that is likely to have significant
economic impact on a substantial number of small entities. The entities
to which this rulemaking would apply are large business and small
business firms that receive a form of incentive for assuming the role
of mentor to 8(a) firms, other small disadvantaged businesses, small
women-owned businesses, Historically Black Universities and Colleges,
and other minority institutions of higher learning. It is the
expectation that at such time as this rule is finalized, those protege
entities would directly benefit from the forms of mentoring described
in this proposed rule. There would not be an adverse economic impact on
contractors or subcontractors. Accordingly, DOE certifies that this
proposed rule would not have a significant economic impact on a
substantial number of small entities, and therefore, no regulatory
flexibility analysis has been prepared.
D. Review Under the Paperwork Reduction Act
This proposed rule would require DOE contractors serving as mentors
to submit semi-annual progress reports to the DOE Mentor-Protege
Program Manager at DOE Headquarters (see proposed Sec. 919.7013). The
information in the progress reports is necessary to determine if the
schedules and developmental assistance levels contained in Mentor-
Protege Agreements are being met. Performance under the Agreements is
the basis for awarding incentive fees to mentor firms. This proposed
collection of information has been submitted to the Office of
Management and Budget for review and approval under the Paperwork
Reduction Act, 44 U.S.C. 3501, et seq. DOE estimates the number of
respondent mentor firms to be 30 and the number of hours required for
recordkeeping and preparation of the reports to be approximately 12
hours per respondent annually. The total annual burden hour from
compliance is expected to be 360 hours (30 x 12 hours per year). The
collection of information contained in this proposed rule is considered
the least burdensome for meeting the requirements and objectives of the
DOE Mentor-Protege Program.
DOE invites public comments concerning: (1) the need for the
reporting requirement; (2) the accuracy of DOE's estimate of the
reporting burden; (3) ways to enhance the quality, utility, and clarity
of the information to be collected; and (4) ways to minimize the burden
of the collection of information on respondents. Send comments
regarding this proposed collection of information to the contact
persons named in the address section of this notice.
E. Review Under the National Environmental Policy Act
DOE has concluded that this proposed rule falls into a class of
actions which would not individually or cumulatively have significant
impact on the human environment, as determined by DOE's regulations (10
CFR part 1021, subpart D) implementing the National Environmental
Policy Act (NEPA) of 1969 (42 U.S.C. 4321 et seq.). Specifically, this
proposed rule is categorically excluded from NEPA review because the
amendments to the DEAR would be strictly procedural (categorical
exclusion A6). Therefore, this proposed rule does not require an
environmental impact statement or environmental assessment pursuant to
NEPA.
F. Review Under Executive Order 12612
Executive Order 12612, (52 FR 41685, October 30, 1987), requires
that regulations, rules, legislation, and any other policy actions be
reviewed for any substantial direct effects on States, on the
relationship between the Federal Government and the States, or in the
distribution of power and responsibilities among the various levels of
Government. If there are sufficient substantial direct effects, then
the Executive Order requires the preparation of a federalism assessment
to be used in all decisions involved in promulgating and implementing a
policy action. This proposed rule merely describes a DOE Mentor-Protege
program. States would not be directly subject to this rule, since they
are not among the class of entities described as mentors or proteges.
DOE has determined that this proposed rule would not have a substantial
direct effect on the institutional interests or traditional functions
of the States.
G. Review Under the Unfunded Mandates Reform Act of 1995
The Unfunded Mandates Reform Act of 1995 (Pub. L. 104-4) generally
requires a Federal agency to perform a detailed assessment of costs and
benefits of any rule imposing a federal mandate with costs to State,
local or tribal governments, or to the private sector of $100 million
or more. This proposed rulemaking would only affect private sector
entities, and the impact is less than $100 million.
H. Treasury and General Government Appropriations Act, 1999
Section 654 of the Treasury and General Government Appropriation,
1999 (Public Law 105-277) requires Federal Agencies to issue a Family
Policymaking Assessment for any proposed rule that may affect family
well being. Today's proposal would not have any impact on the autonomy
or integrity of the family as an institution. Accordingly, DOE
concluded that it is
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not necessary to prepare a Family Policymaking Assessment.
IV. Opportunity for Public Comment
At the beginning of this notice, DOE provided for a 30-day comment
period and set forth the address for submitting written comments. DOE
is not scheduling a public hearing because there are no significant
issues of fact or law that would warrant such a hearing.
List of Subjects in 48 CFR Parts 919 and 952
Government procurement.
Issued in Washington, D.C. on November 29, 1999.
Richard H. Hopf,
Director, Office of Procurement and Assistance Management.
For the reasons set out in the preamble, Chapter 9 of Title 48 of
the Code of Federal Regulations is proposed to be amended as set forth
below.
PART 919--SMALL BUSINESS PROGRAMS
1. The authority citation for Part 919 is revised to read as
follows:
Authority: 42 U.S.C. 7254, 40 U.S.C. 486 (c), 42 U.S.C. 2201.
2. A new subpart 919.70 is added as follows:
Subpart 919.70--The Department of Energy Mentor-Protege Program
Sec.
919.7001 Scope of subpart.
919.7002 Definitions.
919.7003 General policy.
919.7004 General prohibitions.
919.7005 Eligibility acceptance to be a mentor firm.
919.7006 Incentives for DOE contractor participation.
919.7007 Eligibility to be a Protege firm.
919.7008 Selection of Protege firms.
919.7009 Process for participation in the program.
919.7010 Contents of Mentor-Protege Agreement.
919.7011 Developmental assistance.
919.7012 Review and approval process of agreement by OSDBU.
919.7013 Reports.
919.7014 Solicitation provision.
Subpart 919.70--The Department of Energy Mentor-Protege Program
919.7001 Scope of subpart.
The Department of Energy (DOE) Mentor-Protege Program is designed
to encourage DOE prime contractors to assist small disadvantaged firms
certified by the Small Business Administration (SBA) under Section 8(a)
of the Small Business Act, other small disadvantaged businesses, women-
owned small businesses, Historically Black Colleges and Universities,
and other minority institutions of higher learning in enhancing their
capabilities to perform contracts and subcontracts for DOE and other
Federal agencies. The program seeks to foster long-term business
relationships between these small business entities and DOE prime
contractors, and to increase the overall number of these small business
entities that receive DOE contract and subcontract awards.
919.7002 Definitions.
Historically Black Colleges and Universities (HBCUs), as used in
this subpart, means an institution determined by the Secretary of
Education to meet the requirements of 34 CFR 608.2.
Other Minority Institutions of Higher Learning, as used in this
subpart, means an institution determined by the Secretary of Education
to meet the requirements of 20 U.S.C. 1067k.
Small Disadvantaged Business Concern, as used in this subpart,
means a small business concern owned and controlled by socially and
economically disadvantaged individuals that meets the requirements of
13 CFR part 124, subpart B.
Women-Owned Small Business, as used in this subpart, means a small
business concern that meets the requirements of 15 U.S.C. 637(d)(3)(D).
919.7003 General policy.
(a) DOE contractors eligible under 48 CFR 919.7005 may enter into
agreements with businesses certified by the SBA in the 8(a) Program,
other Small Disadvantaged Businesses, Women-Owned Small Businesses,
HBCUs, and other Minority Institutions of higher learning to provide
those firms appropriate developmental assistance to enhance the
capabilities of Proteges.
(b) Costs incurred by a Mentor to provide developmental assistance,
as described in section 919.7011, are allowable only to the extent that
they are incurred in performance of a contract identified in the
Mentor-Protege Agreement and are otherwise allowable in accordance with
the cost principles applicable to that contract.
(c) Headquarters Office of Small and Disadvantaged Business
Utilization (OSDBU) is the DOE Program Manager for the Mentor-Protege
Program.
919.7004 General prohibitions.
DOE may not reimburse the costs of a Mentor in providing any form
of developmental assistance to a Protege except as provided in Section
919.7003(b).
919.7005 Eligibility acceptance to be a Mentor firm.
To be eligible for recognition by DOE as a Mentor, an entity must
be a DOE contractor performing contracts with at least one negotiated
subcontracting plan as required by FAR 19.7.
919.7006 Incentives for DOE contractor participation
(a) Under cost-plus-award fee contracts, approved Mentor firms may
earn award fees associated with their performance as a Mentor. The
award fee plan may include provision for the evaluation of the
contractor's utilization of 8(a) firms, other small disadvantaged
businesses, women-owned small businesses, HBCUs, and other minority
institutions of higher learning. DOE may evaluate the Mentor's
performance in the DOE Mentor-Protege Program under any Mentor-Protege
Agreement(s) as a separate element of the award fee plan.
(b) Mentor firms shall receive credit for subcontracts awarded
pursuant to their Mentor-Protege Agreements toward subcontracting goals
contained in their subcontracting plan.
919.7007 Eligibility to be a Protege firm.
(a) To be eligible for selection as a Protege, a firm must:
(1) Be a small business certified under Section 8(a) of the Small
Business Act by SBA, other certified small disadvantaged business, a
women-owned small business, HBCU, or any other minority institution of
higher learning;
(2) Be eligible for receipt of government contracts;
(3) Have been in business for at least two (2) years prior to
application for enrollment into the Mentor-Protege Program; and
(4) Be able to certify as a small business according to the
Standard Industrial Code for the services or supplies to be provided by
the Protege under its subcontract with the Mentor.
(b) A prospective Mentor may rely in good faith on written
representations by a prospective Protege that the Protege meets the
requirements in paragraph (a) of this section.
919.7008 Selection of Protege firms.
(a) A Mentor firm is solely responsible for selecting one or more
Protege entities from firms eligible under 48 CFR 919.7007.
(b) A Mentor may have more than one Protege; however, a Protege may
have only one Mentor.
(c) The selection of Protege firms by Mentor firms may not be
protested, except as provided in paragraph (d) of this section.
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(d) Only protests regarding the small business size status of a
firm to be a Protege will be considered and shall be submitted to the
DOE Office of Small and Disadvantaged Business Utilization for
resolution. When that Office is unable to resolve a protest, it will
refer the matter to the Small Business Administration for resolution in
accordance with 13 CFR. part 121.
919.7009 Process for participation in the program.
A prospective Mentor firm must submit the following to the DOE
Mentor-Protege Program Manager.
(a) A statement that it is eligible, as of the date of application,
for the award of Federal contracts;
(b) A statement that it is currently performing at least one
contract for DOE;
(c) The DOE contract number, type of contract, period of
performance (including options), title of technical program effort,
name of DOE Program Manager (including contact information) and the DOE
contracting activity; and
(d) An original and two copies of the Mentor-Protege Agreement
signed by the chief executive officers of the Mentor and Protege firms.
919.7010 Contents of Mentor-Protege Agreement.
The proposed Mentor-Protege Agreement must contain:
(a) Names, addresses and telephone numbers of Mentor and Protege
firms and a point of contact within each firm who will oversee the
Agreement;
(b) Requirements for the Mentor firm or the Protege entity to
notify the other entity, DOE Headquarters OSDBU, and the contracting
officer in writing at least 30 days in advance of the Mentor firm's or
the Protege entity's intent to voluntarily terminate or withdraw from
the Mentor-Protege Agreement (Such termination would not terminate any
existing subcontract between the Mentor and the Protege);
(c) A description of the form of developmental assistance program
that will be provided by the Mentor to the Protege firm, including a
description of any subcontract work, and a schedule for providing the
assistance and the criteria for evaluation of the Protege's
developmental success (48 CFR 919.7011);
(d) A listing of the number and types and estimated amount of
subcontracts to be awarded to the Protege firm;
(e) Term of the Agreement;
(f) Procedures for completing performance under the Agreement in
the case of a termination of, or withdrawal from, the Agreement by
either party;
(g) Procedures to be invoked should DOE terminate its recognition
of the Agreement for good cause (such termination of DOE recognition
would not constitute a termination of the subcontract between the
Mentor and the Protege.);
(h) Provision for the Mentor firm to submit to the DOE Mentor-
Protege Program Manager a ``lessons learned'' evaluation developed by
the Mentor at the conclusion of the contract Mentor-Protege Agreement;
(i) Provision for the submission by the Protege firm of a ``lessons
learned'' evaluation to the DOE Mentor-Protege Program Manager at the
conclusion of the Mentor-Protege Agreement;
(j) Description of how the development assistance will potentially
increase subcontracting opportunities for the Protege firm;
(k) Provision for the Mentor firm to brief the DOE Mentor-Protege
Program Manager, the field technical program manager(s), and the
contracting officer at the conclusion of each year in the Mentor-
Protege Program regarding program accomplishments as pertains to the
approved Agreement (where possible, this review may be incorporated
into the normal program review for the Mentor's contract);
(l) Recognition that costs incurred by a Mentor to provide
developmental assistance, as described in 48 CFR 919.7011, are
allowable only to the extent that they are incurred in performance of a
contract identified in the Mentor-Protege Agreement and are otherwise
allowable in accordance with the cost principles applicable to that
contract (the DOE Mentor-Protege Program has no appropriation for
paying for developmental assistance); and.
(m) Other terms and conditions, as appropriate.
919.7011 Developmental assistance.
(a) The forms of developmental assistance a Mentor may provide to a
Protege include, but are not limited to:
(1) Management guidance relating to:
(i) Financial management;
(ii) Organizational management;
(iii) Overall business management planning;
(iv) Business development;
(v) Marketing assistance;
(2) Engineering and other technical assistance;
(3) Noncompetitive award of subcontracts under DOE or other Federal
contracts where otherwise authorized;
(4) Award of subcontracts in the Mentor's commercial activities;
(5) Progress payments based on costs;
(6) Rent-free use of facilities and/or equipment owned or leased by
Mentor; and
(7) Temporary assignment of Mentor personnel to the Protege for
purposes of training.
(b) Costs incurred by a Mentor to provide developmental assistance,
as described in paragraph (a) of this section, are allowable only to
the extent provided at 48 CFR 919.7003(b).
919.7012 Review and approval process of agreement by OSDBU.
(a) OSDBU will review the proposed Mentor-Protege Agreement under
48 CFR 919.7010 and will complete its review and assessment no later
than 30 days after receipt. OSDBU will provide a copy of its assessment
to the cognizant DOE technical program manager and contracting officer
for review and concurrence.
(b) If OSDBU approves the Agreement, the Mentor may implement the
developmental assistance program.
(c) Upon finding deficiencies that DOE considers correctable, the
OSDBU will notify the Mentor and request information to be provided
within 30 days that may correct the deficiencies. The Mentor may then
provide additional information for reconsideration. The review of any
supplemental material will be completed within 30 days after receipt by
the OSDBU and the Agreement either approved or disapproved.
919.7013 Reports.
(a) Prior to performing an evaluation of a Mentor's performance
under its Mentor-Protege Agreement for use in award fee evaluations,
the Mentor-Protege Program Manager must consult with the cognizant DOE
field technical program manager and must provide a copy of the
performance evaluation comments regarding the technical effort and
Mentor-Protege development to the contracting officer.
(b) The DOE Mentor-Protege Program manager must submit semi-annual
reports to the cognizant contracting officer regarding the
participating Mentor's performance in the Program for use in the award
fee determination process.
(c) The DOE contractor must submit progress reports to the DOE
Mentor-Protege Program Manager semi-annually.
919.7014 Solicitation provision.
The contracting officer must insert the provision at 952.219-XX,
DOE Mentor-Protege Program, in all solicitations with an estimated
value in excess of the simplified acquisition threshold.
[[Page 68076]]
PART 952--SOLICITATION PROVISIONS AND CONTRACT CLAUSES
3. The authority citation for Part 952 continues to read as
follows:
Authority: 42 U.S.C. 7254; 40 U.S.C. 486(c).
4. A new subsection 952.219-XX, DOE Mentor-Protege Program is added
as follows:
Sec. 952.219-XX, DOE Mentor-Protege program.
In accordance with 919.7014 insert the following provision in
applicable solicitations.
DOE Mentor-Protege Program
(xxx xx)
The Department of Energy has established a Mentor-Protege
Program to encourage its prime contractors to assist firms certified
under 8(a) of the Small Business Act by SBA, other certified Small
Disadvantaged Businesses, Women-Owned Small Businesses, Historically
Black Colleges and Universities and Minority Institutions and other
Minority Institutions of higher learning in enhancing their business
abilities. If the contract resulting from this solicitation is
awarded on a cost-plus-award fee basis, the contractor's performance
as a Mentor may be evaluated as part of the award fee plan. Mentor
and Protege firms will develop and submit ``lessons learned''
evaluations to DOE at the conclusion of the contract. Any DOE
contractor that is interested in becoming a Mentor should refer to
the applicable regulations at 48 CFR 919.70 and should contact the
Department of Energy's Office of Small and Disadvantaged Business
Utilization.
[FR Doc. 99-31434 Filed 12-3-99; 8:45 am]
BILLING CODE 6450-01-P