[Federal Register Volume 66, Number 165 (Friday, August 24, 2001)]
[Proposed Rules]
[Pages 44588-44589]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 01-21466]
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DEPARTMENT OF DEFENSE
48 CFR Parts 232 and 252
[DFARS Case 2001-D012]
Defense Federal Acquisition Regulation Supplement; Customary
Progress Payment Rate for Large Business Concerns
AGENCY: Department of Defense (DoD).
ACTION: Proposed rule with request for comments.
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SUMMARY: DoD is proposing to amend the Defense Federal Acquisition
Regulation Supplement (DFARS) to increase the customary uniform
progress payment rate for large business concerns from 75 percent to 80
percent. The progress payment rate change will be applicable only to
contract awards made on or after October 1, 2001, with final
implementation contingent upon the approval of a DoD budget and outlay
ceiling for Fiscal Year (FY) 2002 sufficient to accommodate the outlay
impact of this proposed change. The Budget of the United States
Government, FY 2002, submitted by the President, accommodates the
outlay impact. Contracts awarded before October 1, 2001, will not be
modified to include the 80 percent rate.
DATES: Comments on the proposed rule should be submitted to the address
shown below on or before September 24, 2001 to be considered in the
formation of the final rule.
ADDRESSES: Respondents may submit comments directly on the World Wide
Web at http://emissary.acq.osd.mil/dar/dfars.nsf/pubcomm. As an
alternative, respondents may e-mail comments to: [email protected].
Please cite DFARS Case 2001-D012 in the subject line of e-mailed
comments.
Respondents that cannot submit comments using either of the above
[[Page 44589]]
methods may submit comments to: Defense Acquisition Regulations
Council, Attn: Ms. Sandra Haberlin, OUSD (AT&L) DP (DAR), IMD 3C132,
3062 Defense Pentagon, Washington, DC 20301-3062; facsimile (703) 602-
0350. Please cite DFARS Case 2001-D012.
At the end of the comment period, interested parties may view
public comments on the World Wide Web at http://emissary.acq.osd.mil/dar/dfars.nsf.
FOR FURTHER INFORMATION CONTACT: Ms. Sandra Haberlin, (703) 602-0289.
SUPPLEMENTARY INFORMATION:
A. Background
Pursuant to Section 8155 of the FY 1994 Defense Appropriations Act
(Public Law 103-139), DoD reduced the customary progress payment rate
for large business concerns from 85 percent to 75 percent, effective
for solicitations issued on or after November 11, 1993. The rates for
small business and small disadvantaged business concerns (90 percent
and 95 percent, respectively) were not changed.
Despite changes to short term borrowing rates in subsequent years
that have supported an increase in the progress payment rate for large
business concerns, DoD has been unable to accommodate a rate increase
within available funding outlays until FY 2002. This proposed DFARS
change will conform the DoD customary uniform progress payment rate for
large business concerns with the progress payment rate for large
business concerns currently being used by other Executive agencies
under FAR 32.501-1(a). The DoD rate will be applicable only to new
contract awards made on or after October 1, 2001. Contracts awarded
before October 1, 2001, will not be modified to include the 80 percent
rate.
This rule was not subject to Office of Management and Budget review
under Executive Order 12866, dated September 30, 1993.
B. Regulatory Flexibility Act
The proposed rule is not expected to have a significant economic
impact on a substantial number of small entities within the meaning of
the Regulatory Flexibility Act, 5 U.S.C. 601, et seq., because the
progress payment rates for small and small disadvantaged business
concerns are unchanged. Therefore, DoD has not performed an initial
regulatory flexibility analysis. DoD invites comments from small
businesses and other interested parties. DoD also will consider
comments from small entities concerning the affected DFARS subparts in
accordance with 5 U.S.C. 610. Such comments should be submitted
separately and should cite DFARS Case 2001-D012.
C. Paperwork Reduction Act
The Paperwork Reduction Act does not apply because the rule does
not impose any information collection requirements that require the
approval of the Office of Management and Budget under 44 U.S.C. 3501,
et seq.
List of Subjects in 48 CFR Parts 232 and 252
Government procurement.
Michele P. Peterson,
Executive Editor, Defense Acquisition Regulations Council.
Therefore, DoD proposes to amend 48 CFR Parts 232 and 252 as
follows:
1. The authority citation for 48 CFR Parts 232 and 252 continues to
read as follows:
Authority: 41 U.S.C. 421 and 48 CFR Chapter 1.
PART 232--CONTRACT FINANCING
2. Section 232.501-1 is revised to read as follows:
232.501-1 Customary progress payment rates.
(a) The customary progress payment rates for DoD contracts,
including contracts that contain foreign military sales (FMS)
requirements, are 80 percent for large business concerns, 90 percent
for small business concerns, and 95 percent for small disadvantaged
business concerns.
3. Section 232.502-4-70 is amended by revising paragraph (b) to
read as follows:
232.502-4-70 Additional clauses.
* * * * *
(b) Use the clause at 252.232-7004, DoD Progress Payment Rates,
instead of Alternate I of the clause at FAR 52.232-16, if the
contractor is a small business or small disadvantaged business concern.
PART 252--SOLICITATION PROVISIONS AND CONTRACT CLAUSES
4. Section 252.232-7004 is revised to read as follows:
252.232-7004 DoD Progress Payment Rates.
As prescribed in 232.502-4-70(b), use the following clause:
DoD Progress Payment Rates (XXX 2001)
(a) If the contractor is a small business concern, the Progress
Payments clause of this contract is modified to change each mention
of the progress payment rate and liquidation rate (excepting
paragraph (k), Limitations on Undefinitized Contract Actions) to 90
percent.
(b) If the contractor is a small disadvantaged business concern,
the Progress Payments clause of this contract is modified to change
each mention of the progress payment rate and liquidation rate
(excepting paragraph (k), Limitations on Undefinitized Contract
Actions) to 95 percent.
(End of clause)
[FR Doc. 01-21466 Filed 8-23-01; 8:45 am]
BILLING CODE 5000-04-M