instructor preparation · web view2019. 1. 16. · clps 141/ceus 14.1/3 graduate-level credits....

CON 090

FAR Fundamentals

Module 1

Student Guide

January 2019

Jan 16, 2019

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CON 090 Course Syllabus 2

Table of Contents

CON 090 Course Syllabus.............................................................................................................................5

Course Design – How CON 090 “Works”.....................................................................................................9

Module 1 – Using the FAR and DFARS.......................................................................................................13

Module 1 Schedule....................................................................................................................................13

Module 1 Homework.................................................................................................................................13

Introduction...............................................................................................................................................15

Learning Objectives...................................................................................................................................15

The Federal Acquisition Regulation: Questions & Answers.......................................................................17

Organization & Arrangement of the FAR...................................................................................................47

FAR Research Exercise...............................................................................................................................57

DFARS Basics..............................................................................................................................................59

FAR/DFARS Research Exercise...................................................................................................................63

Deviations from the FAR and DFARS.........................................................................................................65

FAR/DFARS/Class Deviations Research Exercise........................................................................................67

Interpreting the FAR..................................................................................................................................69

FAR Interpretation Exercise.......................................................................................................................71

Determining the Applicability of Rules......................................................................................................73

FAR Reading Exercise ................................................................................................................................77

Putting It All Together................................................................................................................................79

Applying the Regulations...........................................................................................................................81

Appendix...................................................................................................................................................85

3 CON 090 Course Syllabus

CON 090 Course Syllabus

A. Course Title: Federal Acquisition Regulation (FAR) Fundamentals

B. Course Number: CON 090

C. Course Prerequisites: None

D. CLPs/CEUs/Number of ACE-Recommended Credits: CLPs 141/CEUs 14.1/3 Graduate-Level Credits

E. Course Description: FAR Fundamentals (CON 090) is a resident Defense Acquisition Workforce Improvement Act (DAWIA) Level I contracting course for newly hired GS-1102 contracting personnel, active military personnel and those who seek certification in the contracting field. This course is four (4) weeks in length and provides foundational knowledge of the Federal Acquisition Regulation (FAR) System. Specifically, the course provides immersion training into the FAR; Defense Federal Acquisition Regulation Supplement (DFARS); the DFARS Procedures, Guidance, and Information (PGI); and Department of Defense (DoD) class deviations from the FAR and DFARS.

F. Course Objective : Given a contracting scenario, the student will locate, interpret, and apply the acquisition regulations applicable to the Department of Defense.

G. Course Concept: The first week of the course will be focused on familiarizing the student with using the FAR/DFARS/PGI/class deviations and developing critical skills necessary to locate, interpret, and apply rules. Subsequent weeks will focus on the application of the FAR/DFARS/PGI/class deviations to real-world scenarios found in the acquisition planning, contract formation, and contract administration phases.

H. Course Materials: CON 090 Student Workbooks

I. The following critical performances are required in this course:

a. Performance: Students must earn a grade of at least 80% to pass (see Evaluation).

b. Behavioral: To be successful in CON 090, students will have to develop effective habits and skills. The instructor’s role will be to guide students through an immersive learning environment—not to provide information that students can easily look up themselves. As such, students shouldn’t be offended when an instructor tells them to “look it up” or doesn’t provide the answer immediately. Students must also accept that, despite their prior academic achievements, they may often be wrong during this course. This is part of the learning process to becoming proficient in the use of procurement regulations in writing and administering contracts. Lastly, students must arrive to class and return from breaks punctually. Students must actively participate in classroom activities and complete all assignments to be successful.


J. Evaluation (How performance will be assessed):

a. Students will be evaluated on the basis of their performance on quizzes and exams. Students must achieve an overall score of 80% to pass. A breakdown of the evaluation scheme is provided below:

12 Quizzes @ 10 points each: 120*

4 Module Examinations @ 100 points each: 400

TOTAL 520

MINIMUM REQUIRED (80%) 416

*There are 14 daily quizzes that are administered throughout course (see para. L. Course Schedule below), but the two lowest scored quizzes are not counted in this grade.

b. Final Grade : Your final grade will be the sum of your overall quiz score, overall exam score, and pre-course incentive points earned.

c. Incentive Points : While completion of the pre-course work is mandatory, you will receive five (5) incentive points upon completion of all three parts via Blackboard prior to attending class (i.e., Performance Support Tool, PST Assessment Questions and the End-of-PST Survey).

d. Reserved.

K. Course Policies

a. Attendance : Student attendance is mandatory. Students are not authorized to miss class time. Failure to be present during all class hours is grounds for removal. In appropriate situations, the instructor may, at his/her discretion, grant student absences provided that the student has requested and obtained approval prior to the absence. In no circumstance will a student be permitted to miss more than 8 hours of class.

b. Student Responsibility : Students are responsible for ensuring that they are attaining the learning objectives. As such, students must communicate any problems or difficulties that they are encountering to the instructor.

c. Academic Freedom : Students have the privilege of debate with discretion on any subject related to curricula within the school forum.


d. Non-Attribution : Students are to treat statements made in the school forum as privileged information not to be attributed to a specific individual when outside the school forum.

e. Make-ups : There will be no opportunity for making up missed quizzes/exams.

f. Reserved :

g. Student Issues/Concerns : DAU encourages students who have an issue or concern with the learning environment to discuss it with the instructor. Students who believe their issue is not resolved satisfactorily may go to the department chair/site manager or Regional Associate Dean for Academics.


L. Course Sequence/Time Schedule: Other than the last day of class, CON 090 will begin each day promptly at 8:00 AM and generally end at 5:00 PM. There will be at least a one-hour lunch break. The last 60 minutes or so of each day, approximately 4:00 to 5:00 PM, are usually set aside for individual classroom study. Instructors may, at their discretion, permit students to leave the classroom and study on their own towards the end of the day. A typical course schedule is provided below. (Note: Class schedule will be adjusted if a holiday occurs during the class dates, including the possibility of a Tuesday start date.)

M T W Th FDAU Classroom Brief

Introduction to CON 090

Using the FAR & DFARS

QUIZ #1

Using the FAR & DFARS (continued)

QUIZ #2


QUIZ #3


EXAM #1

BEGIN MODULE 2

Acquisition Planning Process

QUIZ #4

Sources

Competition

QUIZ #5

Contracting Methods

Contract Types

QUIZ #6

Contract Types (cont.)

Describing Agency Needs

Publicizing Contract Actions

QUIZ #7

Socioeconomic Programs

EXAM #2

BEGIN MODULE 3

Contract Formation Principles

QUIZ #8

Uniform Contract Format & Contract Line Items

Provisions & Clauses

QUIZ #9

Solicitation & Receipt of Offers

Bid Evaluation

QUIZ #10

Proposal Evaluation & Exchanges with Offerors

Contract Award

QUIZ #11

Protests

Simplified Acquisition Procedures

EXAM #3

BEGIN MODULE 4

Initiation of Work

QUIZ #12

Contract Performance Management

QUIZ #13

Contract Modifications

Payment

QUIZ #14

Disputes & Appeals

Terminations/Closeout

EXAM #4

Graduation


Course Design & Instructional Method– How CON 090 “Works”

CON 090 is a very rigorous course, and it will require a considerable amount of focused effort and discipline on your part to be successful. CON 090 will most likely be quite different than any other class you have taken before, and it is also very likely that nothing has prepared you for reading, interpreting, and applying the FAR and DFARS. Therefore to be successful, you must also develop the habit of looking things up before answering any questions and must not rely on your intuition and conventional wisdom. This will take some getting used to. The following description of the design of CON 090—How CON 090 “works” is provided in order to assist with this adjustment.

Application of Bloom’s Taxonomy and the Thayer Method to CON 090

CON 090’s course design is based in part on Bloom’s Taxonomy of the Cognitive Domain. The cognitive domain developed by Dr. Benjamin Bloom and his associates is the most widely accepted in the development of competency/performance-based, criterion-referenced instructional designs. Bloom’s Taxonomy is a classification scheme that breaks down cognitive processes into six steps/levels: Knowledge, Comprehension, Application, Analysis, Synthesis, and Evaluation. Bloom’s Taxonomy is considered a learning hierarchy because the next higher level subsumes each level of learning. That is, it is assumed that in order to function at the Application level, a learner must also be able to function at all levels below Application (Comprehension and Knowledge). Bloom’s cognitive learning hierarchy is analogous to climbing a set of stairs. A learner must acquire factual knowledge before he or she can understand theory. She or he must comprehend theory before they can apply it, and so on up the hierarchy.

The method of instruction used in CON 090 is loosely based on the Thayer method, named after Sylvanus Thayer. Thayer was the superintendent of the United States Military Academy (West Point) from 1817 to 1833 and has become known as the “Father of the Military Academy.” The Thayer method is unique in that it requires students to teach themselves the material prior to class (as homework) and the instructor’s role is to explain the material in class if there are any questions. Further, students are held accountable for their learning by being assessed on a daily basis. The Thayer method is still in use today at West Point. Most CON 090 students have not been exposed to this method of instruction and, as such, a period of adjustment is expected.

In CON 090, you will be assigned homework each night that will assist you in finding the primary facts that will form the basis of the following day’s activities. The homework will not be collected or graded. However, a 15-minute, 10-point open-book quiz will be given first thing each morning of CON 090 (except the first day and the four Module Exam days) that will assess your ability to research the correct information in response to the questions in the CON 090 Workbooks from the FAR, from the DFARS, from the DFARS PGI and/or from the DoD Class Deviations. In other words, the quiz will be given each day prior to the application of the material in class. Each quiz will be written at the Knowledge level—you will have had to find the correct information in order to successfully complete the prior night’s homework assignment, but you will not be required to explain any of the concepts.

9 CON 090 Course Design

As an example of this process:

(1) A homework question might be: “Contract types are grouped into what two broad categories?”

(2) You will research the FAR and DFARS and find the answer at FAR 16.101(b), which states: “The contract types are grouped into two broad categories: fixed-price contracts (see Subpart 16.2 ) and cost-reimbursement contracts (see Subpart 16.3 ).”

(3) The next morning, the following may be found on the quiz: “List the two categories of contract types.”

After the quiz, your instructor will lead a discussion that will help you Comprehend (Bloom’s Level 2) the information that you found in your homework assignment. The instructor will explain (or ask students to explain) some of the key concepts regarding that particular topic. For example, the instructor may explain (or ask a student to explain) the differences between fixed-price and cost-reimbursement contracts. After the discussion, you will be spending most of the remainder of the lesson engaged in group exercises and problems where you will be given an opportunity to Apply (Bloom’s Level 3) what you have learned to real-world scenarios. This is where the majority of your learning will take place.

Student Workbook

Your student workbook is not meant to be a textbook. Your primary reference material in CON 090 will be the FAR, DFARS, DFARS PGI, and DoD Class Deviations. The typical lesson in the student workbook will contain a brief discussion of a specific topic and then contain a number of questions that will guide you to the key information in the regulations dealing with that topic. This information will be critical to your success in doing the exercises and problems and in class.

In-Class Exercises and Problems

With few exceptions, the in-class exercises and problems were deliberately developed to have one correct answer (which is not always the case outside of the classroom). This answer is based on either factual information that can be found in the regulations or on an authoritative interpretation of the regulations found in decisions of the Government Accountability Office (GAO), the Armed Services Board of Contract Appeals (ASBCA), or the federal courts. The correct answer is rarely obvious and you shouldn’t get discouraged if you cannot find it or figure it out. Students will often disagree. Before revealing the correct answer, the instructor will facilitate a discussion to let students explain their positions to each other. You should not get anxious to know the right answer during such a discussion—you will eventually find out the correct answer. Instead, take advantage of the opportunity to rethink your answer or persuade another student that your answer is correct. There is no point in being correct if you cannot convince others that you are correct. Once the correct answer is revealed, it is critical that you understand why the given answer is the correct choice. The purpose of these exercises is for you to practice locating, interpreting, and applying information in the FAR, DFARS, DFARS PGI, and DoD Class Deviations to real world scenarios.

CON 090 Course Design 10

https://www.acquisition.gov/far/current/html/Subpart%2016_3.html#wp1077348


Module Exams

There will be four (4) open-book exams, one at the end of each module, worth 100 points each. Each exam will ask questions in a variety of formats by which to assess a student’s mastery of the course materials (i.e., multiple choice, true or false, providing citations/references, etc…)

The first week of the course, Module 1, will be focused on familiarizing yourself with using the FAR/DFARS/PGI/class deviations and developing critical skills necessary to locate, interpret, and apply rules. Subsequent weeks, Modules 2 – 4, in addition to the critical skills acquired from Module 1, will also include the application of the FAR/DFARS/PGI/class deviations to real-world scenarios found in the acquisition planning, contract formation, and contract administration phases.

Pre-course Work Requirement

CON 090’s mandatory pre-course work requirement is comprised of three (3) parts: the Performance Support Tool (PST); the PST assessment questions; and completion of the PST survey. Access to the pre-course work content is located on Blackboard (Bb). Completion of the pre-course work will better prepare you for what you can expect during the resident portion of the course. Upon completion prior to the resident portion of the course, five (5) incentive points will be added to your overall score for the course (see section L of the course syllabus above).

Also, the CON 090 Performance Support Tool will remain available to you via Bb throughout the resident portion of the course should you desire a refresher on the tool’s learning content.

Extra Credit

Other than the Pre-course Work Requirement incentive bonus points described above, there are no opportunities in CON 090 to earn any extra credit points that could be applied to determine your final minimum score of 416 points required to pass this course.

Final Word

If you put in the required effort, as difficult as that may turn out to be, we believe that you will be able to pass this course. Regardless of the final result, you will return to your office with knowledge and skills that will likely surpass colleagues who have not taken this course. During the time that this course has been offered, we have heard from former students that they are being recognized by their organizations for their facility with the FAR and DFARS. We hope to hear the same from you. Good luck.

11 CON 090 Course Design

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CON 090 Course Design 12

Module 1 – Using the FAR and DFARS

Module 1 introduces the FAR and how to navigate and use acquisition regulations. This module begins by answering the “who, what, when, where, why, and how” of the FAR. The remainder of the module will provide hands-on training on how to use the FAR and DFARS.

Module 1 Schedule

Day 1 Day 2 Day 3 Day 4 Day 5DAU Classroom Brief

Introduction to CON 090

Using the FAR & DFARS

QUIZ #1


QUIZ #2


QUIZ #3


EXAM #1

BEGIN MODULE 2

Acquisition Planning Process

Module 1 Homework

Day Homework Assignment

1For Quiz 1

Study “The Federal Acquisition Regulation: Questions & Answers” (SG p.17-32)

Study “Organization & Arrangement of the FAR” (SG p.47-49) Note definitions of terms and Publications discussed in the Footnotes

2For Quiz 2

Study Organization & Arrangement of the FAR” (SG p.50-55) Study “DFARS Basics”

3For Quiz 3

Study “Deviations from the FAR and DFARS” (incl. Footnotes)

Study “Interpreting the FAR”

Study “Determining the Applicability of Rules”

4 Prepare for exam.

13 Module 1 Overview


Module 1 Overview 14

Module 1 – Using the FAR & DFARS

Introduction

The purpose of this module is to develop the skills necessary to locate, cite, interpret, and apply the policies and procedures in the FAR and DFARS that are applicable to DoD acquisitions. You will need to develop these skills to be successful during Modules 2 through 4 of the course.

Learning Objectives

TLO: Using Web-based resources, locate, cite, interpret, and determine the applicability of policies and procedures in the FAR, DFARS, DFARS PGI, and DoD class deviations.

To achieve this learning objective, students must demonstrate the ability to:

Identify basic background information pertaining to the FAR.

Identify the organization and arrangement of the FAR.

Using Web-based resources, find information contained in the FAR/DFARS/DFARS PGI/class deviations.

Using Web-based resources, provide a citation to the part, subpart, section, subsection, or paragraph level in the FAR/DFARS/DFARS PGI/Class Deviations to support a position.

RESERVED

Identify the organization and arrangement of the DFARS and DFARS PGI.

Identify the general policy for authorizing deviations from the FAR and DFARS.

Given a contracting scenario, determine which acquisition rules are applicable to DoD acquisitions.

Apply the conventions for interpreting the FAR.

15 Module 1 – Using the FAR & DFARS


Module 1 – Using the FAR & DFARS 16

The Federal Acquisition Regulation (FAR): Questions & Answers 1

Introduction

The federal government is the largest buyer of goods and services in the world,2 and executive branch agencies—particularly the Department of Defense—make most of these purchases.3 Many (although not all) acquisitions by executive branch agencies are subject to the Federal Acquisition Regulation (FAR).

The following provides answers to 24 frequently asked questions regarding the FAR. These questions and their answers are organized into six broad categories, including (1) what the FAR is and what it covers; (2) promulgation of the FAR; (3) the relationship between the FAR and other authorities governing federal procurement (e.g., statutes, agency FAR supplements, other regulations, policies); (4) the FAR in relation to Congress and judicial and other tribunals; (5) the relationship between the FAR and federal procurement contracts; and (6) other topics.

The FAR and What It Covers

This section includes questions and answers that broadly address what the FAR is and what it covers, including where the text of the FAR can be found; what agencies are subject to the FAR; what purchases are subject to the FAR; and what transactions fall outside the FAR’s coverage.

1. What is the FAR?

The FAR is a regulation4, codified in Title 48, Chapter 1 of the Code of Federal Regulations (CFR)5 that governs a Federal Government process called “acquisition.”6 In essence, the FAR is

1 The questions and answers in this section are adapted from CRS Report R42826, The Federal Acquisition Regulation: Answers to Frequently Asked Questions, by Kate M. Manuel, L. Elaine Halchin, Erika K. Lunder, and Michelle D. Christensen available at http://www.fas.org/sgp/crs/misc/R42826.pdf. 2 See, e.g., White House, Office of the Press Sec’y, Executive Order: Strengthening Protections against Trafficking in Persons in Federal Contracts, Sept. 25, 2012, at http://www.whitehouse.gov/the-press-office/2012/09/25/executiveorder-strengthening-protections-against-trafficking-persons-fe (characterizing the federal government as the “largest single purchaser of goods and services in the world”).3 The Federal Government purchased $439 billion worth of goods and services in fiscal year (FY) 2015. Of this amount, the Department of Defense purchased $273.6 billion worth of goods and services (~62% of total Federal purchasing by contract). (Source: www.usaspending.gov)4 A regulation is a general statement issued by an agency, board, or commission that has the force and effect of law. Congress often grants agencies the authority to issue regulations. Sometimes Congress requires agencies to issue a regulation; sometimes Congress grants agencies the discretion to do so. Many laws passed by Congress give Federal agencies some flexibility in deciding how best to implement those laws. Federal regulations specify the details and requirements necessary to implement and to enforce legislation enacted by Congress. (http://www.reginfo.gov/public/jsp/Utilities/faq.jsp) 5 The CFR is the codification of the general and permanent rules published in the Federal Register by the departments and agencies of the Federal Government. It is divided into 50 titles that represent broad areas subject to Federal regulation. The Federal Register is the official daily publication for rules, proposed rules, and notices of Federal agencies and organizations, as well as executive orders and other presidential documents.6 “Acquisition” is the process of buying goods and services for the Federal Government’s use. For the complete definition of acquisition, see “What purchases are subject to the FAR?” below.


http://www.reginfo.gov/public/jsp/Utilities/faq.jsp

http://www.usaspending.gov/

http://www.whitehouse.gov/the-press-office/2012/09/25/executiveorder-strengthening-protections-against-trafficking-persons-fe

http://www.whitehouse.gov/the-press-office/2012/09/25/executiveorder-strengthening-protections-against-trafficking-persons-fe

http://www.fas.org/sgp/crs/misc/R42826.pdf

a rule book that most executive agencies7 of the Federal government have to follow when acquiring goods and services through the use of procurement contracts. It places limits on the exercise of an agency’s authority to purchase goods and services using funds appropriated by Congress. For example, the FAR generally requires agencies to obtain “full and open competition” when soliciting offers and awarding contracts. Although it does contain some guidance, the FAR is not an instructional guide for purchasing goods and services. As such, one should not consult the FAR for guidance on the best way to purchase goods and services—rather one should consult the FAR to determine what courses of action would be permissible. Compliance with the FAR generally ensures that an agency’s actions are legal, but it does not ensure that an agency will get a good business deal—skill and judgment of competent acquisition professionals are required for that.

2. Where can I find the FAR?

The FAR is available in print from the Government Printing Office as part of the Code of Federal Regulations, or from private publishers. However, it is arguably most conveniently accessed online, where it is available in either PDF or HTML format, at https://www.acquisition.gov/FAR/ or as Title 48 of the CFR at http://ecfr.gpoaccess.gov/. An unofficial version of the FAR is also available at http://farsite.hill.af.mil.

3. What agencies are subject to the FAR?

The FAR applies to most executive agencies. Some executive agencies and organizational components thereof are exempt from the FAR.8 Examples include the Federal Aviation Administration (FAA), which Congress has authorized to establish its own acquisition system9, and the U.S. Mint.10

The FAR does not apply to legislative branch agencies or judicial branch agencies, although agencies in the other branches of government (or otherwise not subject to the FAR) may adopt the FAR as a matter of policy, or promulgate or otherwise be subject to requirements like those in the FAR. For example, the Library of Congress, a legislative branch agency, has stated that it

7 “Executive agency” means an executive department, a military department, or any independent establishment within the meaning of 5 U.S.C.101, 102, and 104(1), respectively, and any wholly owned Government corporation within the meaning of 31 U.S.C. 9101. FAR 2.1018 When it was established, the Transportation Security Administration (TSA) was authorized to use the FAA’sAcquisition Management System in lieu of the FAR. See Aviation and Transportation Security Act, P.L. 107-71, §101(a), 115 Stat. 597-604 (Nov. 19, 2001) (formerly codified at 49 U.S.C. § 114(o)). However, in 2008, legislation was enacted that removed the statutory provision which exempted TSA from the FAR and permitted it to follow FAA’s acquisition system. See Consolidated Appropriations Act of 2008, P.L. 110-161, § 568, 121 Stat. 2092 (Dec. 26, 2007) (striking Section 114(o)).9 See Department of Transportation and Related Agencies Appropriations Act for FY1996, P.L. 104-50, § 348, 109Stat. 460-61 (Nov. 15, 1995) (directing the Administrator of the Federal Aviation Administration to develop and implement an acquisition system for the FAA).10 See 31 U.S.C. § 5136 (stating that “provisions of law governing procurement or public contracts shall not be applicable to the procurement of goods or services necessary for carrying out [U.S.] Mint programs and operations”).


http://farsite.hill.af.mil/

http://ecfr.gpoaccess.gov/

https://www.acquisition.gov/FAR/

is Library policy to follow the FAR, unless it is determined that a deviation would “be in the best interest of the Library.”11 See also “Could an Agency or Transaction Not Subject to the FAR BeSubject to Requirements Like Those in the FAR?,” below.

The FAR does not directly regulate federal contractors or would-be federal contractors, although such vendors are affected by the application of the FAR’s definitions, policies, procedures, and requirements by contracting officers. For example, the FAR provides policies and procedures related to types of contracts, subcontracting, contract termination, and payments to contractors. See also “What Is the Relationship Between the FAR and a Federal Contract?” and “What Happens If Required Contract Clauses Are Not Included in a Particular Contract?,” below.

4. What purchases are subject to the FAR?

As noted previously (see “What Agencies Are Subject to the FAR?”), executive branch agencies are generally subject to the FAR when making certain purchases. Namely, the FAR applies to acquisitions of supplies (or goods) and services with appropriated funds by most (although not all) executive branch agencies.12 Each of these terms—acquisitions, appropriated funds, supplies, and services—has a specific meaning for purposes of the FAR, which can influence whether the FAR is applicable to particular transactions.

For purposes of the FAR, acquisition means

the acquiring by contract with appropriated funds of supplies or services (including construction) by and for the use of the Federal Government through purchase or lease, whether the supplies or services are already in existence or must be created, developed, demonstrated, and evaluated. Acquisition begins at the point when agency needs are established and includes the description of requirements to satisfy agency needs, solicitation and selection of sources, award of contracts, contract financing, contract performance, contract administration, and those technical and management functions directly related to the process of fulfilling agency needs by contract.13

Appropriated funds are “funds paid out of the United States Treasury” that are charged “to an appropriation provided by or derived from an act of Congress.” An appropriation is “[a]uthority given to federal agencies to incur obligations and to make payments from Treasury for specified purposes.”14

11 Library of Congress Regulation (LCR) 2110, § 3, at http://www.loc.gov/staff/ogc/legal_ref/lcr/2100/2110.html.12 FAR, “Foreword,” at https://www.acquisition.gov/FAR/current/pdf/FAR.pdf.13 FAR 2.10114 Office of the General Counsel, U.S. Gov’t Accountability Office, Principles of Federal Appropriations Law, Vol. 1, at 2-4 to 2-5 (3d ed., 2004), at http://www.gao.gov/assets/210/202437.pdf. But see Int’l Line Builders, B-227811 (Oct. 8, 1987) (rejecting the Bonneville Power Administration’s argument that it was not subject to the FAR because it did not use appropriated funds on the grounds that funds available to an agency, regardless of their private source, are considered appropriated funds when they are made available for collection and expenditure pursuant to specificstatutory authority); USA Fabrics, Inc., B-295737, B-295737.2 (Apr. 19, 2005) (finding that GAO’s bid protestjurisdiction, which is discussed in the FAR, is not based on the expenditure of appropriated funds, but rather turns upon whether the procurement at issue is being conducted by a “federal agency,” as that term is defined in the Competition in Contracting Act).


Supplies means

all property except land or interest in land. It includes (but is not limited to) public works, buildings, and facilities; ships, floating equipment, and vessels of every character, type, and description, together with parts and accessories; aircraft and aircraft parts, accessories, and equipment; machine tools; and the alteration or installation of any of the foregoing.15

Other examples of supplies include office furniture, cameras and audio-visual equipment, information technology and communications equipment, cleaning products and tools, uniforms, and musical instruments.

Generally, services refers to tasks performed by a contractor. More specifically, a service contract means “a contract that directly engages the time and effort of a contractor whose primary purpose is to perform an identifiable task rather than to furnish an end item of supply.” The FAR identifies the following as examples of areas in which service contracts may be found:

(1) Maintenance, overhaul, repair, servicing, rehabilitation, salvage, modernization, or modification of supplies, systems, or equipment

(2) Routine recurring maintenance of real property

(3) Housekeeping and base services

(4) Advisory and assistance services

(5) Operation of Government-owned equipment, real property, and systems

(6) Communications services

(7) Architect-Engineering

(8) Transportation and related services

(9) Research and development16

5. What transactions fall outside the FAR’s coverage?

Certain transactions, by their nature, are not subject to the FAR. Notable examples of such transactions are

any agency contract or agreement that is not a procurement contract (i.e., not a contract that uses appropriated funds to acquire property or services for the direct use of the United States), including other transactions (i.e., non-procurement contracts that authorized agencies may use for research and/or development of prototypes);17

15 FAR 2.10116 FAR 37.101


grants and cooperative agreements;18

contracts with third parties entered into by persons using federal funds from a grant, cooperative agreement, or other federal financial assistance;19

purchases or leases of real property;20

transactions where Congress has authorized a government entity to acquire goods or services “notwithstanding any other provision of law.”21

Subcontracts under federal contracts (i.e., contracts with third parties entered into by federal contractors) are also not subject to the FAR. In some cases, the FAR requires agencies to include terms in their prime contracts obligating their contractors to “flow down” certain requirements to subcontractors22 so that subcontractors may be subject to certain requirements like those in the FAR as terms of their contracts. However, not all requirements flow down, and certain FAR provisions that pertain primarily to the conduct of procurements by executive branch agencies are inapplicable to subcontractors. For example, although federal agencies are generally required to provide for “full and open competition” in the selection of contractors, agency contractors are generally not required to provide for “full and open competition” in the selection of subcontractors.23

17 Several agencies, including the National Aeronautics and Space Administration (NASA), Department of Defense (DOD), and Department of Homeland Security (DHS), have statutory authority to enter into what are known as other transactions (OTs). Generally, agencies with OT authority use OTs for research and development purposes, or prototype development. OTs are not subject to the FAR because the FAR “applies to all acquisitions as defined in Part 2 of the FAR,” and no definition of other transaction appears in Part 2. For more on OTs, see generally CRS Report RL34760, Other Transaction (OT) Authority, by L. Elaine Halchin.18 See generally 31 U.S.C. §§ 6303-6305 (discussing the differences between procurement contracts, grants, and cooperative agreements, including when agencies should use each of these vehicles).19 In some cases, statutes or regulations govern at least some of the terms of contracts entered into with third parties by grant recipients. See “Could an Agency or Transaction Not Subject to the FAR Be Subject to Requirements Like Those in the FAR?,” below.20 See supra note 16 and accompanying text (excluding land and interests in land from the definition of “supplies”).21 See, e.g., 33 U.S.C. § 891d(b) (authorizing the National Oceanic and Atmospheric Administration (NOAA) to enter multiyear contracts for oceanographic research, fisheries research, and mapping and charting services to assist in fulfilling NOAA missions “[n]otwithstanding any other provision of law”).22 See, e.g., FAR 52.214-26(e) (“The Contractor shall insert a clause containing all the provisions of this clause[regarding audits and records] … in all subcontracts expected to exceed the threshold in FAR 15.403-4(a)(1) for submission of certified cost or pricing data.”).23 But see FAR 44.204(c) (requiring contracting officers to include the clause at FAR 52.244-5 in solicitations and contracts under certain conditions; FAR 52.244-5(a) (“The Contractor shall select subcontractors (including suppliers) on a competitive basis to the maximum practical extent consistent with the objectives and requirements of the contract.”).


6. What does the FAR cover?

The various parts of the FAR contain somewhat different types of information, as illustrated below. In particular, Parts 1 through 51 establish policies, requirements, exceptions, practices, and procedures to guide members of the acquisition workforce in performing their responsibilities, while Parts 52 and 53 provide standard solicitation and contract clauses and forms. In addition, while much of the FAR is arguably process oriented (e.g., specifying how agencies may obtain full and open competition), the opening sections of the FAR articulate “guiding principles” for the federal acquisition system that provide guidance for the entire procurement process. This includes the guiding principles in FAR 1.102 to satisfy customer needs (cost, quality, timeliness) while minimizing administrative costs, acting with integrity and supporting public policies.

Parts 1 to 51

Contracting officers and other members of the acquisition workforce rely on the FAR for guidance on a wide range of topics, including acquisition planning, publicizing contract actions, required sources of supplies and services, and types of contracts.24 Additionally, the FAR provides definitions of words and terms used in government procurement.25

Depending upon the topic, the FAR may provide contracting officers with the government’s basic policy, any requirements that agencies must meet, and any exceptions to these requirements. For example, FAR subpart 6.1 articulates that, as a matter of policy, “contracting officers shall promote and provide for full and open competition in soliciting offers and awarding Government contracts,”26 and identifies acceptable procedures for full and open competition (e.g., sealed bidding, competitive proposals).27 FAR subpart 6.3, in turn, identifies the circumstances in which other than full and open competition is permitted (e.g., only one responsible source, urgent and compelling circumstances). It also specifies the procedures and requirements for using other than full and open competition (e.g., contracting officers are generally required to justify their decision to use other than full and open competition, and obtain approval from a higher-ranking agency official).

In other cases, the FAR articulates general standards that agencies are to consider in making certain determinations, or the grounds upon which agencies may take certain actions. Thus, FAR

24 See FAR parts 7, 5, 8, and 16, respectively.25 See Part 2 of the FAR. In some cases, additional, or context-specific, definitions are given in other parts of the FAR, including the standard solicitation or contract clauses. See, e.g., FAR 9.301 (defining “approval” for purposes of the FAR provisions on first article testing and approval); FAR 52.204-3 (defining “common parent” for purposes of the clause regarding taxpayer identification).26 FAR 6.101(a)27 FAR 6.102. The term full and open competition refers to acquisitions where “all responsible sources are permitted to submit sealed bids or competitive proposals.” 41 U.S.C. § 107. Sealed bidding “is a method of contracting that employs competitive bids, public opening of bids, and awards.” FAR 14.101. Competitive proposals may be used when sealed bids are not appropriate, such as instances where it is necessary to conduct discussions with offerors relative to proposed contracts. FAR 6.401(b). Other competitive procedures include awards resulting from a “broad agency announcement that is general in nature identifying areas of research interest, including criteria for selecting proposals, and soliciting the participation of all offerors capable of satisfying the Government’s needs.” FAR 6.102(d)(2).


part 9—which addresses “contractor qualifications”—specifies the “general standards” that contracting officers must consider when determining whether prospective contractors are responsible. It similarly describes the grounds upon which agency suspension and debarment officials may exclude persons from federal contracting for a temporary or fixed period. Other provisions of FAR part 9 describe how contracting officers may (or, in some cases, must) obtain information for use in making determinations regarding contractor qualifications (e.g., preaward surveys, the Federal Awardee Performance and Integrity Information System (FAPIIS), and the Excluded Parties List System (EPLS)).

Yet other provisions articulate the responsibilities of various agency personnel in administering the contract. Contract administration may include a variety of tasks and responsibilities depending on, for example, the type of contract and the goods or services acquired. FAR part 42 provides guidance for contracting officers and other members of the acquisition team regarding audits, postaward orientations for contractors, production surveillance and reporting, and collection of contractor performance information, among other things. Additionally, a detailed list of 71 specific contract administration functions may be found at FAR 42.302, which is to be used by the contract administration office (CAO).

Parts 52 and 53

FAR parts 52 and 53 differ from the other parts of the FAR in that they provide agencies with standard provisions and clauses to be included, or incorporated by reference, in the solicitation or contract, as well as forms for use during the acquisition process. FAR part 52 contains solicitation provisions and contract clauses prescribed elsewhere in the FAR. Each provision and clause has its own unique identification number.28 For example, the following provision is included in solicitations that involve an Office of Management and Budget (OMB) Circular A-76 standard competition:29

Notice of Standard Competition (May 2006)(a) This solicitation is part of a standard competition under Office of Management and Budget Circular No. A-76 (Revised), Performance of Commercial Activities, dated May 29, 2003 (hereafter “the Circular”), to determine whether to accomplish the specified work under contract or by Government performance.(b) The Government will evaluate private sector offers, the agency tender, and public reimbursable tenders, as provided in this solicitation and the Circular.(c) A performance decision resulting from this standard competition will be publicly announced in accordance with the Circular.(d) As provided in the Circular, directly interested parties may file contests, which are governed by the procedures in Federal Acquisition Regulation 33.103. Until resolution of any contest, or the expiration of the time for filing a contest, only legal agents for directly interested parties shall have access to the certified standard competition form, the agency tender, and public reimbursable tenders.30

(End of provision)

28 Each identification number corresponds to the part of the FAR in which the provision or clause is prescribed. FAR subpart 52.3 contains a matrix that lists the unique identification number for each provision or clause and the principle contract types and purposes to which it applies.29 Circular A-76 provides the policy and procedures for, among other things, conducting public-private competitions involving federal agencies and private contractors. The circular is available at http://www.whitehouse.gov/sites/default/files/omb/assets/omb/circulars/a076/a76_incl_tech_correction.pdf. 30 FAR 52.207-1


http://www.whitehouse.gov/sites/default/files/omb/assets/omb/circulars/a076/a76_incl_tech_correction.pdf

FAR part 53 contains standard, optional, and agency-prescribed acquisition forms, such as Standard Form 30, “Amendment of Solicitation/Modification of Contract”; Optional Form 312, “Small Disadvantaged Business (SDB) Participation Report”; and DOD Form DD 254, “Department of Defense, Contract Security Classification Specification.”31

Structure of the FAR

Part # Title of Part

Subchapter A—General

1 Federal Acquisition Regulations System

2 Definitions of Words and Terms

3 Improper Business Practices and Personal Conflicts of Interest

4 Administrative Matters

Subchapter B—Competition and Acquisition Planning

5 Publicizing Contract Actions

6 Competition Requirements

7 Acquisition Planning

8 Required Sources of Supplies and Services

9 Contractor Qualifications

10 Market Research

11 Describing Agency Needs

12 Acquisition of Commercial Items

Subchapter C—Contracting Methods and Contract Types

13 Simplified Acquisition Procedures

14 Sealed Bidding

15 Contracting by Negotiation

16 Types of Contracts

31 FAR subpart 53.3



17 Special Contracting Methods

18 Emergency Acquisitions

Subchapter D—Socioeconomic Programs

19 Small Business Programs

20 Reserved

21 Reserved

22 Application of Labor Laws to Government Acquisitions

23 Environment, Energy and Water Efficiency, Renewable Energy Technologies, Occupational Safety, and Drug-Free Workplace

24 Protection of Privacy and Freedom of Information

25 Foreign Acquisition

26 Other Socioeconomic Programs

Subchapter E—General Contracting Requirements

27 Patents, Data, and Copyrights

28 Bonds and Insurance

29 Taxes

30 Cost Accounting Standards Administration

31 Contract Cost Principles and Procedures

32 Contract Financing

33 Protests, Disputes, and Appeals

Subchapter F—Special Categories of Contracting

34 Major System Acquisition

35 Research and Development Contracting

36 Construction and Architect-Engineer Contracts


https://www.acquisition.gov/far/current/html/FARTOCP36.html#wp223483





https://www.acquisition.gov/far/current/html/Part%2020_Reserved.html#wp1029985

https://www.acquisition.gov/far/current/html/Part%2020_Reserved.html#wp1029985


37 Service Contracting

38 Federal Supply Schedule Contracting

39 Acquisition of Information Technology

40 Reserved

41 Acquisition of Utility Services

Subchapter G—Contract Management

42 Contract Administration and Audit Services

43 Contract Modifications

44 Subcontracting Policies and Procedures

45 Government Property

46 Quality Assurance

47 Transportation

48 Value Engineering

49 Termination of Contracts

50 Extraordinary Contractual Actions and the SAFETY Act

51 Use of Government Sources by Contractors

Subchapter H—Clauses and Forms

52 Solicitation Provisions and Contract Clauses

53 Forms

Guiding Principles for the Federal Acquisition System

In addition to providing procedures and requirements that, collectively, make up the procurement process, discussed above, the FAR also articulates guiding principles for the federal acquisition system (which includes performance standards), and describes the federal acquisition team and its roles and responsibilities. According to the FAR, the overarching vision of the acquisition system “is to deliver on a timely basis the best value product or service to the customer, while










maintaining the public’s trust and fulfilling public policy objectives.”32 In brief, the four performance standards are

(a) [s]atisfy the customer in terms of cost, quality, and timeliness of the delivered product or service[;]

(b) [m]inimize administrative operating costs[;]

(c) [c]onduct business with integrity, fairness, and openness[; and]

(d) [f]ulfill public policy objectives.33

Agency personnel—including “representatives of the technical, supply, and procurement communities” and “the customers they serve”—and contractors make up the acquisition team.34 Government members of the team “must be empowered to make acquisition decisions within their areas of responsibility … [possess] the authority to make decisions … and be prepared to perform the functions and duties assigned.” The contractor is also encouraged to be prepared.35

Promulgation of the FAR

The questions and answers in this section address the promulgation of the FAR, including the origins of the FAR; the process by which the FAR is amended; who typically promulgates regulations amending the FAR; the roles of the Office of Federal Procurement Policy (OFPP) and the Office of Management and Budget (OMB) in revising and implementing the FAR; and how long it generally takes to amend the FAR.

7. How did the FAR originate?

Prior to the establishment of the FAR system and the initial publication of the FAR, two primary procurement regulations existed: the Federal Procurement Regulations (FPR) and the Defense Acquisition Regulation (DAR).36 Generally, the FPR applied to civilian agencies and the DAR applied to the Department of Defense (DOD) and its components, although the then-Atomic Energy Commission (AEC), Central Intelligence Agency (CIA), National Aeronautics and Space Administration (NASA), Tennessee Valley Authority (TVA), and Bonneville Power Administration, among others, each had “semiautonomous procurement regulations.”37 The proliferation of agency procurement regulations was such that, in its 1972 report, the Commission on Government Procurement stated that it had found “a burdensome mass and maze of procurement and procurement-related regulations” within the federal government, and “no effective overall system for coordinating, controlling, and standardizing regulations.”38

32 FAR 1.102(a)33 FAR 1.102-234 FAR 1.102(c)35 FAR 1.102-436 The Armed Services Procurement Regulation (ASPR) was renamed the Defense Acquisition Regulation in 1978.37 Comm’n on Gov’t Procurement, Report of the Commission on Government Procurement, Vol. 1, at 33 (1972).38 Id. at 31.


The commission’s report provided an impetus for bringing order to the “mass and maze” of procurement regulations. Notably, in 1979 Congress enacted amendments to the Office of Federal Procurement Policy statute39 authorizing the Administrator of the Office of Federal Procurement Policy (OFPP) to prescribe government-wide procurement policies to be implemented in a “single government-wide procurement regulation called the Federal Acquisition Regulation.”40 Subsequently, OFPP released Policy Letter 80-5. This document effectively established the “Federal Acquisition Regulations System” and stated that the system would include, among other things, “[a] single Federal Acquisition Regulation (FAR), to be issued jointly by the General Services Administration, the Department of Defense, and the National Aeronautics and Space Administration, pursuant to their respective authorities” under the Procurement statute, the Armed Services Procurement Act, and the National Aeronautics and Space Act.41

The FAR was published initially on September 19, 1983, and took effect on April 1, 1984.42 It has been periodically amended since then, as discussed below (see “Who Typically Promulgates Regulations Amending the FAR?” and “How Is the FAR Amended?”).

8. How is the FAR amended?

The FAR was initially promulgated—and has subsequently been amended—using the same rulemaking procedures used in promulgating other regulations. In short, the Department of Defense (DOD), the General Services Administration (GSA), and the National Aeronautics and Space Administration (NASA), acting on behalf of the Federal Acquisition Regulatory Council (FAR Council), or the Administrator of the Office of Federal Procurement Policy (OFPP), as discussed below (see “Who Typically Promulgates Regulations Amending the FAR?”), issue proposed and final rules amending the FAR under the “notice-and-comment” procedures of 41 U.S.C. 1707 (a) which states as follows: 43

Covered Policies, Regulations, Procedures, and Forms.—

(1) Required comment period.— Except as provided in subsection (d), a procurement policy, regulation, procedure, or form (including an amendment or modification thereto) may not take effect until 60 days after it is published for public comment in the Federal Register pursuant to subsection (b) if it—

(A) relates to the expenditure of appropriated funds; and

(B)

39 Now 41 U.S.C. Div. B of subtitle I (as amended).40 41 U.S.C. § 1121(b)41 U.S. Office of Mgmt. & Budget, Federal Acquisition Regulations System; Other Procurement Rules and Regulations, 45 Fed. Reg. 48076 (July 17, 1980).42 Dep’t of Def., Gen. Servs. Admin., and Nat’l Aeronautics & Space Admin., Establishing the Federal AcquisitionRegulation, 48 Fed. Reg. 42102 (Sept. 19, 1983).43 Most federal rulemaking is accomplished under the Administrative Procedures Act (APA) (5 U.S.C. § 553). However, rules pertaining to public contracts are exempt from the APA. 41 U.S.C. 1707 imposes “notice-and-comment” procedures on agencies when issuing procurement rules.


(i) has a significant effect beyond the internal operating procedures of the agency issuing the policy, regulation, procedure, or form; or

(ii) has a significant cost or administrative impact on contractors or offerors.

(2) Exception.— A policy, regulation, procedure, or form may take effect earlier than 60 days after the publication date when there are compelling circumstances for the earlier effective date, but the effective date may not be less than 30 days after the publication date.

In addition to the 41 U.S.C. 1707, there are a number of executive orders and other statutes that may be applicable to the rulemaking process (for example, Executive Order 12866, the Regulatory Flexibility Act, and the Paperwork Reduction Act all have additional requirements agencies must follow when promulgating rules).44

9. Who typically promulgates regulations amending the FAR?

The Federal Register notices proposing or announcing amendments to the FAR are jointly issued by the Department of Defense (DOD), the General Services Administration (GSA), and the National Aeronautics and Space Administration (NASA).45 These three agencies issue theFederal Register notices, in part, because federal statutes and regulations task the heads of these agencies with “jointly issu[ing] and maintain[ing] … a single Government-wide procurement regulation, to be known as the Federal Acquisition Regulation.”46 However, the amendments proposed and announced by DOD, GSA, and NASA have been arrived at by means of and with the concurrence of the Federal Acquisition Regulatory Council (FAR Council). This council— which consists of the Administrator of OFPP, the Secretary of Defense, the Administrator of National Aeronautics and Space, and the Administrator of General Services, or their designees (see “What Roles Do OFPP and OMB Play in Revising and Implementing the FAR?”)47—is also tasked by statute with certain responsibilities as to the FAR. Specifically, the council is to “assist in the direction and coordination of Government-wide procurement policy and Government-wide procurement regulatory activities in the Federal Government,”48 as well as “manage, coordinate, control, and monitor the maintenance of, issuance of, and changes in, the Federal Acquisition Regulation.”49

44 See generally CRS Report RL32240, The Federal Rulemaking Process: An Overview, coordinated by Maeve P.Carey.45 See, e.g., Dep’t of Defense, Gen. Servs. Admin., & Nat’l Aeronautics & Space Admin., Federal AcquisitionRegulation: United States-Korea Free Trade Agreement, 77 Fed. Reg. 56739 (Sept. 13, 2012) (amending FAR parts 4, 25, and 52 in response to the United States-Korea Free Trade Agreement).46 41 U.S.C. § 1303(a)(1) (“Subject to sections 1121, 1122(a) to (c)(1), 1125, 1126, 1130, 1131, and 2305 of this title, the Administrator of General Services, the Secretary of Defense, and the Administrator of National Aeronautics and Space, pursuant to their respective authorities under division C of this subtitle, chapters 4 and 137 of title 10, and the National Aeronautics and Space Act of 1958 …, shall jointly issue and maintain in accordance with subsection (d) a single Government-wide procurement regulation, to be known as the [FAR].”). See also 45 Fed. Reg. at 48076 et seq.47 41 U.S.C. § 1302(b)(1)-(2).48 41 U.S.C. § 1302(a).49 41 U.S.C. § 1303(d). In addition, a number of statutes have specifically tasked the FAR Council with implementing particular amendments to the FAR. See, e.g., Sudan Accountability and Divestment Act, P.L. 110-


In practice, the FAR Council operates by referring potential changes to the FAR to one or more standing “FAR teams,” each of which is responsible for maintaining specific parts of the FAR.50 Each team is created by the FAR Council, and is composed of representatives from military and civilian agencies and advisory representatives from OFPP.51 The FAR teams are directed by theCivilian Agency Acquisition Council (CAAC) and the Defense Acquisition Regulations Council(DAR Council), and their activities are coordinated to ensure agreement and cooperation between civilian and defense acquisition personnel.52 The relevant FAR team drafts and submits potential FAR amendments to the CAAC and the DAR Council for review. After the councils have reviewed a potential FAR amendment, they submit it to OFPP and the Office of Information and Regulatory Affairs (OIRA) for additional review. These are then sent to the FAR signatories within GSA, DOD, and NASA for approval before being published as proposed, interim final, or final rules in the Federal Register.

The Administrator of OFPP is also authorized to amend the FAR on his or her own if he or she determines that GSA, DOD, and NASA “are unable to agree on or fail to issue Government-wide regulations.”53 In practice, the Administrator of OFPP appears to have seldom exercised this authority after the initial promulgation of the FAR. However, the Administrator has periodically issued policy letters and notices pertaining to federal procurement, as discussed below (see “Does the FAR Include All the Government’s Procurement Policies?”).54

174, § 6(d), 121 Stat. 2521 (Dec. 31, 2007) (“Not later than 120 days after the date of the enactment of this Act, the Federal Acquisition Regulatory Council shall amend the Federal Acquisition Regulation … to provide for the implementation of the requirements of this section.”); Energy Independence and Security Act, P.L. 110-140, § 433(c), 121 Stat. 1614 (Dec. 19, 2007) (“Not later than 2 years after the date of the enactment of this Act, the Federal Acquisition Regulation shall be revised to require Federal officers and employees to comply with this section and the amendments made by this section in the acquisition, construction, or major renovation of any facility. The members of the Federal Acquisition Regulatory Council … shall consult with the Federal Director and the Commercial Director before promulgating regulations to carry out this subsection.”).50 For additional information on the structure and responsibilities of the FAR Teams, see the “FAR Operating Guide,” at http://www.acq.osd.mil/dpap/dars/far/attachments/FAR%20Operating%20Guide%20Version%203.pdf. 51 See Memorandum from Robert A. Burton, Associate Administrator of OFPP, to Federal Acquisition Council Senior Agency Procurement Executives, “Revised FAR Process,” March 11, 2004. Also see testimony of David Drabkin, Acting Chief Acquisition Officer, U.S. General Services Administration, before U.S. Congress, House Committee on Oversight and Government Reform, Subcommittee on Government Management, Organization, and Procurement, H.R. 5712, Close the Contractor Fraud Loophole Act, and H.R. 5787, Federal Real Property Disposal Enhancement Act, 110th Cong., 2nd sess., April 15, 2008.52 The CAAC and the DAR Council are made up of senior procurement officials, and the two Councils assist in the development of changes to the FAR. FAR subpart 1.2 states that “revisions to the FAR will be prepared and issued through the coordinated action of two councils, the Defense Acquisition Regulations Council (DAR Council) and the Civilian Agency Acquisition Council (CAA Council).” FAR 1.201-1(a).53 41 U.S.C. § 1121(d). As is discussed in greater detail below (see “What Roles Do OFPP and OMB Play in Revising and Implementing the FAR?”), the Administrator of OFPP may also, with the concurrence of the Director of OMB, deny the promulgation of or rescind any government-wide regulation, or final rule or regulation of an executive agency relating to procurement, if the Administrator determines that the rule or regulation is inconsistent with any policies, regulations, or procedures of the FAR. 41 U.S.C. § 1121(e).54 See, e.g., Exec. Office of the President, Office of Mgmt. & Budget, Office of Federal Procurement Pol’y, Publication of the Office of Federal Procurement Policy (OFPP) Policy Letter 11-01, Performance of Inherently Governmental and Critical Functions, 76 Fed. Reg. 56227 (Sept. 12, 2011). OFPP periodically promulgates regulations amending the Cost Accounting Standards in Chapter 99 of Title 48 of the Code of Federal Regulations. See, e.g., Exec. Office of the President, Office of Mgmt. & Budget, Office of Federal Procurement Pol’y, Cost


http://www.acq.osd.mil/dpap/dars/far/attachments/FAR%20Operating%20Guide%20Version%203.pdf

Congress does not itself amend the FAR, although it could enact legislation that could prompt the executive branch to amend the FAR. See “What Can Congress Do to Prompt Amendment of the FAR?,” below.

10. What roles do OFPP and OMB Play in Revising and Implementing the FAR?

The Office of Federal Procurement Policy (OFPP) provides overall direction for the Government-wide procurement policies, regulations, procedures, and forms for executive agency acquisitions that make up the FAR.55 The Administrator for Federal Procurement Policy is responsible for directing the development of the procurement policies that are implemented, in part, by the FAR. The Administrator also establishes procedures to ensure that executive agencies are complying with the FAR.

In addition, the Administrator serves as the chair of the Federal Acquisition Regulatory Council(FAR Council), which “assist[s] in the direction and coordination of Government-wide procurement policy and Government-wide procurement regulatory activities.”56 The Secretary of Defense, Administrator of the National Aeronautics and Space Administration (NASA), and Administrator of the General Services Administration (GSA) are the other members of the FAR Council. In the event that these three members are unable to reach agreement regarding revisions to the FAR, the Administrator of OFPP has the authority to prescribe certain revisions without their concurrence,57 as discussed above (see “Who Typically Promulgates Regulations Amending the FAR?”).

The Office of Management and Budget (OMB) provides oversight and review of proposed changes and amendments to the FAR. These responsibilities are largely carried out by OMB’s Office of Information and Regulatory Affairs (OIRA). Rules amending the FAR are subject to the same rulemaking requirements that are applicable to executive agencies, which typically include review by OIRA. Both OFPP and OIRA review proposed changes to the FAR to ensure that they are consistent with the law and policies of the Administration. The Administrator of OFPP, in concurrence with the Director of OMB, may deny or rescind any Government-wide regulation or final rule of any executive agency relating to procurement if the Administrator determines that the regulation or rule is inconsistent with the policies, regulations, or procedures issued pursuant to the FAR.58

11. How long does it take to amend the FAR?

Accounting Standards: Elimination of the Exemption from Cost Accounting Standards for Contracts and Subcontracts Executed and Performed Entirely Outside the United States, Its Territories, and Possessions, 76 Fed. Reg. 49365 (Aug. 10, 2011). However, Chapter 99 of Title 48 is not part of the FAR, as noted above (see “What Is the Federal Acquisition Regulation?”).55 41 U.S.C. § 1121. The Office of Federal Procurement Policy (OFPP) was established, as part of the Office of Management and Budget (OMB), in 1974 by the Office of Federal Procurement Policy Act (P.L. 93-400).56 41 U.S.C. § 1303(d). The FAR Council was established by the Office of Federal Procurement Policy ActAmendments of 1988 (P.L. 100-679).57 41 U.S.C. § 1121(d).58 41 U.S.C. § 1121(e).


Depending upon how the regulation is promulgated (see “How Is the FAR Amended?”), the number of comments received upon a proposed change, and other factors, the process of amending the FAR can take anywhere from months to years (and, in some cases, a change is proposed, but not finalized).59 The FAR amendment could potentially take longer than any period prescribed in statute for the amendment, where amendment is required by statute.60 However, rules generally have the force of law even if they are enacted after any statutory deadline for their promulgation.61 Moreover, while agencies could potentially be compelled to take action in certain circumstances if they have “unreasonably delayed,” they have seldom, if ever, been compelled to issue procurement regulations.62 This is, in part, because congressional indications of how quickly an agency should proceed are only one factor in determining whether a delay is unreasonable and agency action should be compelled.63 Other factors include (1) whether a danger to human health is implicated by the delay; (2) the agency’s competing priorities; (3) the interests prejudiced by the delay; and (4) whether the agency has treated the present party disparately from others.64 Certain of these factors (e.g., danger to human health, disparate treatment) would seldom be implicated in a procurement context.

Relationship between the FAR and Other Authorities Governing Procurement

This section addresses the relationship between the FAR and other authorities governing federal procurement, including statutes, agency FAR supplements, other regulations, and executive branch policies and guidance.

59 See, e.g., Deborah Billings, USDA Drops Plan to Fast-Track Rule on Contractor Labor Law Compliance, 97 Fed.Cont. Rep. 85 (Jan. 31, 2012) (reporting that the Department of Agriculture had withdrawn a rule, originally scheduled to take effect on February 28, 2012, that would have required contractors to certify their compliance with labor laws).60 See, e.g., Small Business Jobs Act, P.L. 111-240, § 1334, 124 Stat. 2542-43 (Sept. 27, 2010) (requiring that the FAR be amended, “[n]ot later than 1 year after the date of enactment,” to address certain matters pertaining to prime contractors’ payment of small business subcontractors). This amendment had not been made as of January 22, 2013.61 See, e.g., Barnhart v. Peabody Coal, 537 U.S. 149, 158-59 (2002) (“[I]f a statute does not specify a consequence for noncompliance with statutory timing provisions, the federal courts will not in the ordinary course impose their own coercive sanction.”).62 See, e.g., U.S. Women’s Chamber of Commerce v. U.S. Small Bus. Admin., No. 1:04-CV-01889, 2005 U.S. Dist.LEXIS 32497 (D.D.C., Nov. 30, 2005) (unpublished) (finding that the Small Business Administration’s (SBA’s) delay in implementing the statute authorizing set-asides for women-owned small businesses was unreasonable, but declining to grant injunctive relief, in part, because the SBA had “re-drafted proposed regulations and [is] actively searching for proposals to conduct [the statutorily required] study”). In this case, Congress enacted the legislation authorizing set-asides for women-owned small businesses (WOSBs) in 2000. However, for various reasons, SBA did not have regulations to implement such set-asides in effect until February 4, 2011, and the FAR was not amended to address set-asides for WOSBs until April 1, 2011. U.S. Small Bus. Admin., Women-Owned Small Business Federal Contract Program: Final Rule, 75 Fed. Reg. 62258 (Oct. 7, 2010) (final regulations effective February 4, 2011); Dep’t of Defense, Gen. Servs. Admin., & Nat’l Aeronautics & Space Admin., Federal Acquisition Regulation: Women-Owned Small Business (WOSB) Program: Interim Rule, 76 Fed. Reg. 18304 (Apr. 1, 2011). Thus, the first acquisitions set-aside for WOSBs were conducted in summer 2011.63 See, e.g., Telecomm. Research & Action Center v. Federal Commc’n Comm’n, 750 F.2d 70, 80 (D.C. Cir. 1984). For further discussion of this case, see the CRS Legal Sidebar posting, Keeping TRAC of Agency Delays, by Daniel T. Shedd, at http://www.crs.gov/analysis/legalsidebar/pages/details.aspx?ProdId=153.64 See, e.g., Telecomm. Research & Action Center, 750 F.2d at 80.


12. What is the relationship between the FAR and procurement or other statutes?

In addition to the FAR, there are a number of statutes that, directly or indirectly, address the acquisition of goods and services by executive branch agencies. The primary statutes governing federal procurement are the Armed Services Procurement Act and the Procurement statute, which, respectively, govern the procurements of defense and civilian agencies. However, a number of other statutes also apply, including the Kickbacks statute; Selection of Architects and Engineers statute; Buy American statute; Buy Indian Act; Contract Disputes statute; Contract Work Hours and Safety Standards statute; Wage Rate Requirements (Construction) statute; Defense Production Act; Economy Act; Federal Activities Inventory Reform (FAIR) Act; Bonds statute; Office of Federal Procurement Policy statute; Prompt Payment Act; Service Contract Labor Standards statute; Small Business Act; Trade Agreements Act; Truthful Cost or Pricing Data statute (Federal only); Truth in Negotiations Act (DoD only); and Contracts for Materials, Supplies, Articles, and Equipment Exceeding $15,000 statute. In addition, there are a number of provisions within other statutes (e.g., national defense authorizations acts, appropriations acts) that address procurement.

The FAR implements many such statutory provisions, although, in some cases, other agency regulations may also implement particular statutory provisions (e.g., the Small Business Act), and the FAR must “conform” to the nonprocurement regulations of other agencies (see below “What Is the Relationship Between the FAR and Other Regulations (i.e., Non-FAR Supplements)?”). However, there are some procurement-related provisions in statute—especially in permanent provisions of appropriations laws65—that are not reflected in the FAR or the agency FAR supplements discussed below (see “What Is the Relationship Between the FAR and Agency FAR Supplements?”). These include, for example, statutory grounds for debarment, authorization to enter noncompetitive contracts related to hazardous fuels reduction activities, and certain restrictions upon the purchase of incandescent lamps.66

On the other hand, because certain statutes grant the executive branch broad discretion to regulate federal contracting,67 there are provisions in the FAR that do not have a direct

65 See, e.g., An Act Making Appropriations for the Government of the District of Columbia and Other ActivitiesChargeable in Whole or in Part against the Revenues of Said District for the Fiscal Year Ending September 30, 2001, and for Other Purposes, P.L. 106-553, App’x B, Title I, § 119, 114 Stat. 2762A-69 (Dec. 21, 2000) (“[T]he Attorney General hereafter may enter into contracts and other agreements, of any reasonable duration, for detention or incarceration space or facilities, including related services, on any reasonable basis.”). See also Principles of Federal Appropriations Law, supra note 16, Vol. 1, at 2-33 to 2-39 (discussing when general provisions of an appropriations act may be construed as permanent legislation).66 See, e.g., 42 U.S.C. § 7606 (statutory debarment for certain violations of the Clean Air Act); 42 U.S.C. § 17141 (prohibition upon the purchase or installation of general service incandescent lamps at certain Coast Guard facilities); Consolidated Appropriations Act, 2012, P.L. 112-74, Wildland Fire Management (Including Transfers and Rescission of Funds), 125 Stat. 1003 (Dec. 23, 2011) (noncompetitive contracts). Provisions like that in P.L. 112-74 have appeared in appropriations for the Department of the Interior since 2004. See Mason C. Alinger, The Impact of Procurement Provisions in Appropriations Acts on the Federal Acquisition System, 36 Pub. Cont. L.J. 583, 593 (2006/2007).67 See, e.g., 40 U.S.C. § 121(a) (authorizing the President to prescribe policies and directives that the President“considers necessary” to promote economy and efficiency in federal procurement). For more on presidential authority to impose requirements on federal contractors, see generally CRS Report R41866, Presidential Authority to Impose Requirements on Federal Contractors, by Kate M. Manuel.


counterpart in federal statute. Examples include the grounds for administrative debarment and suspension, the requirement that contractors disclose “credible evidence” of certain offenses to federal officials, and the procedures surrounding the government’s termination of contracts for convenience or default.68 Often the FAR provisions without direct statutory counterparts have developed in response to executive orders;69 judicial or other decisions;70 or policy recommendations.71

13. What is the relationship between the FAR and agency FAR supplements?

The FAR expressly authorizes agency heads to issue agency-specific procurement regulations that implement or supplement the FAR.72 These are codified in Title 48 of the Code of FederalRegulations, immediately following the FAR.73 A well-known example is the Department ofDefense’s (DOD’s) Defense Federal Acquisition Regulation Supplement (DFARS), which is found in chapter 2 of Title 48, Code of Federal Regulations.

There is a common misperception that agency FAR supplements differ significantly from theFAR and essentially create agency-unique procurement structures. This is generally not the case, particularly when a statute does not impose or authorize unique procurement requirements for an agency. Rather, absent agency-specific statutory requirements, agency-specific regulations may only be issued when necessary to implement FAR policies and procedures, or to supplement the

68 FAR subpart 9.4 (debarment and suspension); FAR subpart 3.10 (mandatory disclosure rule); FAR part 49 (termination for convenience and default).69 For example, the FAR Council amended the FAR in 2008 to require certain federal contractors and subcontractors (continued…)(…continued) to make “timely disclosure” to agency inspectors general and contracting officers whenever they have “credible evidence” that a violation of the civil False Claims Act or certain federal criminal laws has occurred in connection with the award, performance, or close-out of a federal contract. See Dep’t of Defense, Gen. Servs. Admin., & Nat’l Aeronautics & Space Admin., Federal Acquisition Regulation; FAR Case 2007-006, Contractor Business Ethics Compliance Program and Disclosure Requirements: Final Rule, 73 Fed. Reg. 67064, 67065 (Nov. 12, 2008). This amendment was prompted by certain recommendations made by the Department of Justice, although Congress did enact legislation requiring that contracts for commercial items, or performed overseas, be subject to any disclosure rule promulgated by the FAR Council. See Supplemental Appropriations Act, 2008, P.L. 110-252, § 6102, 122 Stat. 2386 (June 30, 2008); Letter to the Honorable Paul Denett, Administrator, Office of Federal Procurement Policy, from the Honorable Alice S. Fisher, Assistant Attorney General, Criminal Division, Department of Justice, May 23, 2007, at http://www.justice.gov/criminal/npftf/far/docs/2007/5-23-07-Fisher-Denett.pdf. 70 For example, the FAR Council proposed amending the FAR in 2011 to delete certain provisions regarding price evaluation adjustments for small disadvantaged businesses implemented under the authority of a statute that the U.S.Court of Appeals for the Federal Circuit found was unconstitutional on its face in its 2008 decision in Rothe Development Corporation v. Department of Defense. See Dep’t of Defense, Gen. Servs. Admin., and Nat’l Aeronautics & Space Admin., Federal Acquisition Regulation: Constitutionality of Federal Contracting Programs for Minority-Owned and Other Small Businesses, 76 Fed. Reg. 55849 (Sept. 9, 2011).71 See, e.g., Dep’t of Defense, Gen. Servs. Admin., & Nat’l Aeronautics & Space Admin., Federal Acquisition Regulation: Sustainable Acquisition, 76 Fed. Reg. 31395 (May 31, 2011) (implementing, in part, Executive Order 13514, Federal Leadership in Environmental, Energy, and Economic Performance, 74 Fed. Reg. 52117 (Oct. 8, 2009)).72 FAR 1.301(a)(1)73 FAR 1.303(a)


http://www.justice.gov/criminal/npftf/far/docs/2007/5-23-07-Fisher-Denett.pdf

http://www.justice.gov/criminal/npftf/far/docs/2007/5-23-07-Fisher-Denett.pdf

FAR to meet the agency’s specific needs.74 Further, the regulations may not conflict or be inconsistent with the FAR, except as required by law or if the agency has used an authorized deviation (see “May Agencies Deviate from the FAR?”).75

The FAR contains requirements that agencies must follow when promulgating such regulations.They include providing notice and comment in the Federal Register when required (e.g., if the regulations have a significant cost or administrative impact on contractors or offerors).76 Additionally, agencies must comply with such federal laws as the Paperwork Reduction Act andRegulatory Flexibility Act.77 See “How Is the FAR Amended?,” above.

74 FAR 1.302; see also 41 U.S.C. § 1303(a)(2) (providing that procurement regulations other than the FAR must be limited to those “essential to implement Government-wide policies and procedures within the agency” and “additional policies and procedures required to satisfy the specific and unique needs of the agency”).75 FAR 1.304(b)(2). See, e.g., Desciose v. Delbalzo, 1998 U.S. App. LEXIS 27937, *4 (9th Cir., Oct. 29, 1998) (unpublished) (explaining that if a GSA regulation were to conflict with the FAR, then the FAR would control).76 FAR 1.301(b). See also Davies Precision Machining, Inc. v. United States, 35 Fed. Cl. 651, 657 (1996) (“The FAR and DFARS are issued under statutory authority and published in conformance with required statutory and regulatory procedures. FAR § 1.301(b). Accordingly, those regulations have the force and effect of law.”).77 FAR 1.301(b). The Paperwork Reduction Act is codified at 44 U.S.C. § 3501, et seq. and the RegulatoryFlexibility Act is codified at 5 U.S.C. § 601, et seq.


Title 48 of the CFR: Federal Acquisition Regulations System

Chapter Parts Name of Regulation1 1-99 Federal Acquisition Regulation (FAR)2 200-299 Defense FAR Supplement (DFARS)3 300-399 Health and Human Services Acquisition Regulation (HHSAR)4 400-499 Agriculture Acquisition Regulation (AGAR)5 500-599 General Services Acquisition Regulation (GSAR)6 600-699 Department of State Acquisition Regulation (DOSAR)7 700-799 Agency for International Development (AIDAR)8 800-899 Department of Veterans Affairs (VAAR)9 900-999 Department of Energy (DEARS)10 1000-1099 Department of the Treasury (DTAR)12 1200-1299 Department of Transportation (TAR)13 1300-1399 Department of Commerce (CAR)14 1400-1499 Department of the Interior (DIARS)15 1500-1599 Environmental Protection Agency (EPAAR)16 1600-1699 Office of Personnel Management, Federal Employees Health Benefits Acquisition

Regulation (FEHBAR)17 1700-1799 Office of Personnel Management18 1800-1899 National Aeronautics and Space Administration (NFS)19 1900-1999 Broadcasting Board of Governors (IAAR)20 2000-2099 Nuclear Regulatory Commission (NRCAR)21 2100-2199 Office of Personnel Management, Federal Employees Group Life Insurance Federal

Acquisition Regulation (LIFAR)23 2300-2399 Social Security Administration24 2400-2499 Department of Housing and Urban Development (HUDAR)25 2500-2599 National Science Foundation28 2800-2899 Department of Justice (JAR)29 2900-2999 Department of Labor (DOLAR)30 3000-3099 Department of Homeland Security

Homeland Security Acquisition Regulation (HSAR)34 3400-3499 Department of Education Acquisition Regulation (EDAR)51 5100-5199 Army FAR Supplement (AFARS)52 5200-5299 Navy-Marine Corps Acquisition Regulation Supplement (NMCARS)53 5300-5399 Air Force FAR Supplement (AFFARS)54 5400-5499 Defense Logistics Acquisition Directive (DLAD)57 5700-5799 African Development Foundation61 6100-6199 Civilian Board of Contract Appeals, General Services Administration63 6300-6399 Department of Transportation Board of Contract Appeals99 9900-9999 Cost Accounting Standards Board, Office of Federal Procurement Policy, Office of

Management and Budget

14. What is the relationship between the FAR and other regulations (i.e., non-FAR supplements)?

Although the FAR and any agency FAR supplements, discussed above (see “What Is theRelationship Between the FAR and Agency FAR Supplements?”), are intended to guide executive agencies in acquiring goods and services, they may not be the only regulations to address particular procurement-related topics. For example, regulations promulgated by the Department of Energy codified in Title 10 of the Code of Federal Regulations discuss the award and administration of energy savings performance contracts by federal agencies. These long-term


contracts—which provide for the contractor to incur the costs of implementing energy savings measures in exchange for a share of any energy savings directly resulting from the measures—are also discussed in certain agency FAR supplements.78 However, Title 10 expressly provides that

The provisions of this subpart are controlling with regard to energy savings performance contracts notwithstanding any conflicting provisions of the Federal Acquisition Regulation and related Federal agency regulations.79

Other agency regulations directly or indirectly pertaining to federal procurement include those inTitles 13, 28, 29, and 41 of the Code of Federal Regulations, which, respectively, discuss contracting with small businesses; Federal Prison Industries/UNICOR; the Wage Rate Requirements (Construction) statute and Service Contract Labor Standards statute, and certain other labor provisions; and AbilityOne and contractors’ antidiscrimination and affirmative action obligations.

Depending upon the requirements of the underlying statute and, particularly, whom this statute charges with its implementation, the FAR provisions may need to “conform” to the provisions of another agency’s regulations,80 or the FAR and any agency regulations may be issued with the “concurrence” of all agencies involved.81

15. Does the FAR include all the Government’s procurement policies?

Various procurement policies, requirements, and guidance are issued by OFPP or OMB as circulars, guides, memoranda, and policy letters.82 Some of these documents supplement material found in the FAR, while others cover subjects or issues not found in the FAR. For example, Policy Letter 11-01, “Performance of Inherently Governmental and Critical Functions,” addresses a topic also addressed in the FAR. Policy Letter 11-01 provides specific guidance regarding how agencies are to manage inherently governmental and other functions,83 while FAR subpart 7.5 lists examples of functions that are considered to be inherently governmental, or that “may approach being in that category because of the nature of the function, the manner in which the contractor performs the contract, or the manner in which the

78 48 C.F.R. § 225.7017-1 (DOD); 48 C.F.R. § 225.7017-4 (DOD); 48 C.F.R. § 801.602-70 (Veterans Affairs).79 10 C.F.R. § 436.30(a).80 See, e.g., 15 U.S.C. § 634(b)(6) (authorizing the Administrator of Small Business to “make such rules andregulations as he deems necessary to carry out the authority vested in him by or pursuant to this chapter,” which, among other things, limits agencies’ ability to “bundle” or “consolidate” requirements into contracts that are unsuitable for award to small businesses); U.S. Small Bus. Admin., Acquisition Process: Task and Delivery Order Contracts, Bundling, Consolidation: Notice of Proposed Rulemaking, 77 Fed. Reg. 29130 (May 16, 2012) (“This proposed rule [regarding contract bundling] may conflict with current FAR and General Services Administration regulations. As a result, those regulations will need to be amended once this rule is issued as final.”).81 See, e.g., 42 U.S.C. § 8287(b)(1)(A) (“The Secretary [of Energy], with the concurrence of the [FAR Council] … shall, by rule, establish appropriate procedures and methods for use by Federal agencies to select, monitor, and terminate contracts with energy service contractors in accordance with laws governing Federal procurement that will achieve the intent of this section in a cost-effective manner.”).82 See the heading “Policy Information” on the Office of Federal Procurement Policy’s website, athttp://www.whitehouse.gov/omb/procurement_default, for links to circulars, guides, memoranda, policy letters, and other documents.83 See 76 Fed. Reg. at 56227.


http://www.whitehouse.gov/omb/procurement_default

Government administers contractor performance.”84 In contrast, other procurement topics are addressed by OFPP memoranda, but not covered in the FAR. Examples include Federal Activities Inventory Reform (FAIR) Act inventories, service contract inventories, and the quality of federal procurement data.85

The FAR, Congress, and Judicial and Other Tribunals

This section includes questions and answers that address what Congress can do to prompt amendment of the FAR; what Congress can do if it disapproves of a potential amendment to the FAR; and the deference given to FAR provisions by judicial and other tribunals.

16. What can Congress do to prompt amendment of the FAR?

As noted previously (see “Who Typically Promulgates Regulations Amending the FAR?”), Congress does not itself amend the FAR. However, Congress may prompt the executive branch to amend the FAR by doing one of two things. In some cases, Congress effectively prompts amendment of the FAR by enacting or amending a law implemented, in part, through the FAR.86

This law need not mention the FAR, or amendment of the FAR, for an amendment to ensue. In

other cases, Congress explicitly directs that the FAR be amended.87 Sometimes, Congress also specifies that the FAR Council should make this amendment, or the time frame within which the amendment should be made (although not all FAR amendments required by Congress are made within the prescribed time frame, as discussed above, “How Long Does It Take to Amend the FAR?”). The former approach appears to be more common in situations where procurement or other statutes directly address the topic of the legislation, while the latter approach tends to be used in situations where the FAR addresses topics not directly addressed in statute (see “What Is the Relationship Between the FAR and Procurement or Other Statutes?”).

84 FAR 7.503.85 Lesley A. Field, Acting Administrator, Office of Fed. Procurement Pol’y, Federal Activities Inventory Reform(FAIR) Act Submission for Fiscal Year 2012, Mar. 26, 2012, at http://www.whitehouse.gov/sites/default/files/omb/memoranda/2012/m-12-09_0.pdf; Daniel I. Gordon, Administrator, Office of Fed. Procurement Pol’y, Service Contract Inventories, Dec. 19, 2011, at http://www.whitehouse.gov/sites/default/files/omb/procurement/memo/servicecontract- inventory-guidance.pdf; Daniel I. Gordon, Administrator, Office of Fed. Procurement Pol’y, Improving Federal Procurement Data Quality – Guidance for Annual Verification and Validation, May 31, 2011, athttp://www.whitehouse.gov/sites/default/files/omb/procurement/memo/improving-data-quality-guidance-for-annualverification-and-validation-may-2011.pdf. 86 See, e.g., Small Business Jobs Act, P.L. 111-240, § 1313, 124 Stat. 2538-39 (Sept. 27, 2010) (codified at 15 U.S.C. § 657q) (imposing certain limitations upon agencies’ consolidation of requirements into contracts unsuitable for award to small business, but not directly calling for the promulgation of regulations on consolidation). SBA recently proposed amending its regulations, including those on bundling, to address the Small Business Jobs Act’s restrictions on consolidation, and it is anticipated that the FAR will be amended in conformity with any SBA regulations once the SBA regulations are finalized. See 77 Fed. Reg. at 29149.87 See, e.g., P.L. 111-240, § 1334, 124 Stat. 2542-43 (codified at 15 U.S.C. § 637(d)(12)(E) (“Not later than 1 year after the date of enactment …, the [FAR Council] … shall amend the [FAR] … to—(i) describe the circumstances under which a contractor may be determined to have a history of unjustified, untimely payments to subcontractors; (ii) establish a process for contracting officers to record the identity of a contractor described in clause (i); and (iii) require the identity of a contractor described in clause (i) to be incorporated in, and made publicly available through, the Federal Awardee Performance and Integrity Information System, or any successor thereto.”).


http://www.whitehouse.gov/sites/default/files/omb/procurement/memo/servicecontract-%20inventory-guidance.pdf

http://www.whitehouse.gov/sites/default/files/omb/memoranda/2012/m-12-09_0.pdf

http://www.whitehouse.gov/sites/default/files/omb/procurement/memo/improving-data-quality-guidance-for-annualverification-and-validation-may-2011.pdf

http://www.whitehouse.gov/sites/default/files/omb/procurement/memo/improving-data-quality-guidance-for-annualverification-and-validation-may-2011.pdf

However, as discussed previously (see “Who Typically Promulgates Regulations Amending theFAR?”), the FAR Council and OFPP may also amend the FAR without the enactment of procurement-related legislation or a congressional directive to do so. Some FAR amendments are initiated by the FAR Council, in particular, in response to policy concerns or litigation.88 In other cases, the FAR Council amends the FAR in response to an executive order directing the amendment of the FAR, or otherwise addressing procurement matters.89 Thus, committees and Members of Congress could also encourage the FAR Council or OFPP to use its authority to amend the FAR, or encourage the President to issue an executive order, provided that the proposed changes are within their authority.90

17. What can Congress do if it disapproves of a potential amendment to the FAR?

In certain circumstances, Congress may have concerns about a proposed or final amendment to the FAR, particularly one which may have resulted from executive branch action without express statutory authorization. Members of Congress may make such concerns known to the executive branch informally (e.g., via letters), or through the exercise of oversight, in the hope of prompting the abandonment or modification of the provisions in question. In some cases, however, Congress may also enact legislation that effectively or expressly forecloses certain amendments to the FAR. For example, Congress could enact legislation whose requirements would be inconsistent with certain potential amendments to the FAR, as happened in 2008, when Congress required that contracts for commercial items or performed overseas be subject to any “mandatory disclosure rule” promulgated by the FAR Council.91 Congress could also enact legislation that bars agencies from imposing certain requirements on contractors, or from using appropriated funds to implement rules, regulations, or executive orders pertaining to contract-related matters.92 In addition, the Congressional Review Act (CRA) (5 U.S.C. §§801-808) provides Congress with the opportunity to overturn a final rule, including a rule that would amend the FAR, through the enactment of a joint resolution of disapproval. If passed by Congress and signed into law by the President, a joint resolution of disapproval results in the

88 See supra notes 72-73.89 See supra note 75.90 For example, absent a statute expressly authorizing such awards, the FAR Council would arguably lack the authority to amend the FAR to authorize agencies to make sole-source awards to “local firms,” because such awards would not constitute full and open competition, and Congress has expressly required that any exception to the requirement that agencies obtain full and open competition through the use of competitive procedures be expressly authorized by statute, or involve certain narrow circumstances (e.g., unusual and compelling circumstances).91 Supplemental Appropriations Act, 2008, P.L. 110-252, § 6102, 122 Stat. 2386 (June 30, 2008) (“The FederalAcquisition Regulation shall be amended within 180 days after the date of the enactment of this Act pursuant to FAR Case 2007-006 (as published at 72 Fed. Reg. 64019, November 14, 2007) or any follow-on FAR case to include provisions that require timely notification by Federal contractors of violations of Federal criminal law or overpayments in connection with the award or performance of covered contracts or subcontracts, including those performed outside the United States and those for commercial items.”).92 See, e.g., National Defense Authorization Act for Fiscal Year 2012, P.L. 112-81, § 823, 125 Stat. 1502-03 (Dec. 31, 2011) (“The head of an agency may not require a contractor to submit political information related to the contractor or a subcontractor at any tier, or any partner, officer, director, or employee of the contractor or (continued…)(…continued) subcontractor (1) as part of a solicitation, request for bid, request for proposal, or any other form of communication designed to solicit offers in connection with the award of a contract for procurement of property or services; or (2) during the course of contract performance as part of the process associated with modifying a contract or exercising a contract option.”); Consolidated Appropriations Act, 2012, P.L. 112-74, § 743, 125 Stat. 939 (Dec. 23, 2011) (“None of the funds made available in this or any other Act may be used to recommend or require any entity submitting an offer for a Federal contract to disclose [certain political spending] as a condition of submitting the offer.”).


rule having no “force or effect.” Enacted in March 1996 as part of the Small Business Regulatory Enforcement Fairness Act (SBREFA) (P.L. 104-121), the CRA contains expedited procedures for congressional consideration of such joint resolutions of disapproval.

18. How much deference do courts and other tribunals give to FAR provisions?

Like other regulations, FAR provisions represent agencies’ constructions of the statutes which they implement. As such, judicial and other tribunals generally review the provisions of the FAR in light of Chevron, USA v. Natural Resources Defense Council in determining whether these interpretations are entitled to deference (commonly known as “Chevron deference”).93 In Chevron, the Supreme Court articulated a two-part test for review of an agency’s construction of a statute which it administers: (1) Has Congress directly spoken to the precise question at issue, and (2) If not, is the agency’s reasonable interpretation of the statute consistent with the purposes of the statute?94 “[I]f the statute speaks clearly ‘to the precise question at issue,’” the tribunal “must give effect to the unambiguously expressed intent of Congress,”95 regardless of what the agency regulation provides. However, where “the statute is silent or ambiguous with respect to the specific issue,” the tribunal “must sustain the [a]gency’s interpretation if it is ‘based on a permissible construction’ of the Act.”96

Over the years, certain FAR provisions have been upheld under Chevron on the grounds thatCongress has not spoken directly to the precise question at issue, and the agency’s interpretation is reasonable and consistent with the purposes of the underlying statute.97 However, other provisions have been found either to be contrary to the intent of Congress, as “unambiguously expressed” in statute; or to be based on an impermissible construction of the underlying statute.98

93 467 U.S. 837 (1984). Some judges and commentators have suggested that at least certain provisions of the FAR are not entitled to Chevron deference, apparently on the grounds that no specific agency was expressly granted authority to promulgate them. See, e.g., DynCorp, ASBCA No. 49714, 00-2 B.C.A. ¶ 30,986 (suggesting that certain provisions of the FAR were not entitled to Chevron deference because the Board found “no indication that Congress entrusted the accommodation of conflicting policies on the issue before us to the agencies through the FAR”). This view appears to be a minority one, however. See, e.g., Brownlee v. Dyncorp, 349 F.3d 1343, 1354 (Fed. Cir. 2003) (“The FAR regulations are the very type of regulations that the Supreme Court in Chevron and later cases has held should be afforded deference.”); Info. Tech. & Applications Corp. v. United States, 316 F.3d 1312, 1321 (Fed. Cir. 2003) (“Where, as here, an agency has adopted a regulation by notice-and-comment rulemaking, the Chevron standard of deference applies to that regulation.”); Newport News Shipbuilding & Dry Dock Co. v. Garrett, 6 F.3d 1547, 1552 (Fed. Cir. 1993) (“[W]e must accord ‘considerable weight’ to the agency’s interpretation of a statute it is responsible to implement.”).94 Chevron, 467 U.S. at 842-43.95 Barnhart v. Walton, 535 U.S. 212, 217 (2002) (quoting Chevron, 467 U.S. at 842-43).96 Id. at 218 (quoting, in part, Chevron, 467 U.S. at 843).97 See, e.g., Brownlee, 349 F.3d at 1355-56 (finding that FAR provisions disallowing the costs of a governmentcontractor in defending against criminal charges brought by the United States against one of the contractor’s employees in which the employee is convicted was not inconsistent with the underlying statute, even though that statute only addressed convictions of contractors, not convictions of contractor employees); Info. Tech. & Applications Corp., 316 F.3d at 1312 (finding that FAR provisions defining “discussions” and “clarifications” were entitled to Chevron deference even though these definitions represented new interpretations of the terms).98 See, e.g., DGR Assocs. v. United States, 94 Fed. Cl. 189 (2010) (finding that FAR and SBA regulations thatimplicitly provided for parity among the small business set-aside programs conflicted with the Small Business Act insofar as the act required agencies to use a set-aside for HUBZone small businesses in certain circumstances); Mission Critical Solutions v. United States, 91 Fed. Cl. 386 (2010) (same); Engineered Demolition, Inc. v. United States, 60 Fed. Cl. 822 (2004) (finding that certain provisions defining “defective certification” then in FAR 33.201 were not entitled to Chevron deference because Congress had not delegated authority to implement them to the


These provisions tend to be amended to conform to the underlying statute (although in some cases, the underlying statute has been amended to support a long-standing agency interpretation).99

In contrast, individual agency interpretations of the FAR, issued in guidance or other documents, are not entitled to Chevron deference, although they may receive a lesser degree of deference.100

The extent of such deference is generally “understood to vary with circumstances,” such as “the degree of the agency’s care, its consistency, formality, and relative expertness, and … the persuasiveness of the agency’s position,” as well as the “writer’s thoroughness, logic, and expertise, its fit with prior interpretations, and any other source of weight.”101

The FAR and Federal Contracts

This section includes questions and answers addressing the relationship between the FAR and a federal contract; whether FAR amendments apply to pre-existing contracts; and what happens if a contract clause which is required by the FAR is not included in a particular contract.

19. What is the relationship between the FAR and a federal contract?

The FAR applies only to federal agencies, while the contract applies to both the agency and the contractor. Thus, it is the provisions in the contract, not those in the FAR that bind the contractor, although contract terms required by the FAR may be read into contracts which lack them in certain circumstances (see “What Happens If Required Contract Clauses Are Not Included in a Particular Contract?”).

While the FAR contains many standard terms and clauses, the details and specifics are left to the individual contract. For this reason, the drafting that occurs for each contract can be highly important. The interaction between the FAR and the contract is exemplified by the treatment of economic price adjustments. These provide for the upward or downward revision of prices in a contract if certain conditions occur.102 The FAR provides that there are three general types of economic price adjustments: those based on established prices; those based on actual costs of labor or material; and those based on cost indexes of labor or material.103 When one of these price adjustments is to be used, the contract will then be drafted to address the specifics, such as

executive branch, but rather intended the courts to make such determinations).99 See, e.g., Small Business Jobs Act, P.L. 111-240, § 1347(b)(1), 124 Stat. 2547 (Sept. 27, 2010) (amending the Small Business Act to provide for parity among the set-aside programs); Dep’t of Defense, Gen. Servs. Admin., Nat’l Aeronautics & Space Admin., Federal Acquisition Regulation: FAR Case 2006-034, Socioeconomic Program Parity: Proposed Rule, 73 Fed. Reg. 12699, 12699 (Mar. 10, 2008) (implementing the relevant provisions of the Small Business Jobs Act).100 See, e.g., Wash. State Dep’t of Soc. & Health Servs. v. Guardianship Estate of Keffeler, 537 U.S. 371, 385 (2003) (holding that cogent “administrative interpretations ... not [the] products of formal rulemaking ... warrant respect,” but are not accorded Chevron deference); Christensen v. Harris County, 529 U.S. 576, 587 (2000) (“Interpretations such as those in ... policy statements, agency manuals, and enforcement guidelines, all of which lack the force of law—do not warrant Chevron-style deference.”).

101 United States v. Mead Corp., 533 U.S. 218, 235 (2001).102 FAR 16.203103 FAR 16.203-1(a)(1)


identifying the events that will trigger the price adjustment, identifying the applicable indexes or established prices, and establishing the base levels.

Importantly, while courts and other tribunals will generally interpret a statute or regulation, such as the FAR, by looking at its plain language,104 a contract will be construed by looking at the intent of the parties.105 In addition, provisions of a contract could potentially be waived by a party to the contract.106

20. Do amendments to the FAR apply to pre-existing contracts?

Amendments to the FAR generally apply only to contracts entered into on or after the date of the amendment, not to pre-existing contracts (i.e., contracts whose terms have already been agreed upon).107 The FAR itself characterizes this as a “convention.”108 However, this convention is intended to shield the government from liability for breach of contract, which it could potentially incur were it to unilaterally amend the terms of an existing contract.109 Moreover, when the FAR change is prompted by a statute, this convention also reflects the fundamental canon of statutory interpretation that laws will not be given retroactive effect unless there is clear congressional intent to the contrary.110 A procurement-related statute could potentially be found to have

104 See Barnhart v. Sigmon Coal Co., 534 U.S. 438, 450 (2002) (reciting the “plain meaning rule,” which provides that if the language of a statute is clear, there is no need to look outside the statute to ascertain its meaning); Caminetti v. United States, 242 U.S. 470, 485 (1917) (“the meaning of the statute must, in first instance, be sought in the language in which the act is framed, and if that is plain, ... the sole function of the courts is to enforce it according to its terms”) (citations omitted).105 See Alvin, Ltd. v. U.S. Postal Service, 816 F.2d 1562, 1565 (Fed. Cir. 1987) (“In the case of contracts, the avowed purpose and primary function of the court is the ascertainment of the intent of the parties”) (quoting S. Williston, A Treatise on the Law of Contracts § 601 (3d ed. 1961)); Firestone Tire & Rubber Co. v. United States, 444 F.2d 547, 551 (Ct. Cl. 1971) (“It has been a fundamental precept of common law that the intention of the parties to a contract control its interpretation.”).106 A waiver is a relinquishment of a legal right. See, e.g., Am. Nat’l Bank & Trust Co. v. United States, 23 Cl. Ct. 542 (1991). The government could potentially be bound by a waiver if the contractor relies upon the waiver to its detriment. See, e.g., Miller Elevator Co. v. United States, 30 Fed. Cl. 662, 687 (1994) (constructive waiver of specifications by acceptance of a nonspecification performance); Freeway Ford Truck Sales, Inc. v. Gen. Servs. Admin., GSBCA 10662, 93-3 BCA ¶ 26,019 (finding termination for default improper where the government had waived its right to terminate by allowing the contractor to continue with production). However, agencies may not waive statutory requirements unless specifically authorized to do so. See, e.g., M-R-S Mfg. Co. v. United States, 492 F.2d 835 (Ct. Cl. 1974) (contracting officer could not waive the requirements of the Truth in Negotiations Act).107 FAR 1.108(d) (“Unless otherwise specified—(1) FAR changes apply to solicitations issued on or after theeffective date of the change; (2) [c]ontracting officers may, at their discretion, include the FAR changes in solicitations issued before the effective date, provided award of the resulting contract(s) occurs on or after the effective date; and (3) [c]ontracting officers may, at their discretion, include the changes in any existing contract with appropriate consideration.”).108 Id.109 The general rule is that any changes to a contract must be bilateral and supported by consideration. See, e.g., Ford v. Ford, 68 P.3d 1258, 1268 (Alaska 2003). However, certain government contracts include a Changes clause, which authorizes the government to make certain unilateral modifications within the scope of the contract. See generally CRS Report R42469, Government Procurement in Times of Fiscal Uncertainty, by Kate M. Manuel and Erika K. Lunder.110 See Gozlon-Peretz v. United States, 498 U.S. 395, 404 (1991) (“absent a clear direction by Congress to the contrary, a law takes effect on the date of its enactment”). See also Miller v. Florida, 482 U.S. 423, 430 (1987) (“A law is retrospective if it changes the legal consequences of acts completed before its effective date.”) (internal


retroactive effect if it purported to alter the parties’ obligations under a contract whose terms had been agreed upon prior to the statute’s enactment.111

21. What happens if required contract clauses are not included in a particular contract?

Because the standard contract clauses are designed, in part, to protect the government’s interests in the performance of the contract, the FAR generally requires that some variant of these clauses be either included or incorporated by reference in agency contracts.112 However, agencies have sometimes awarded contracts that lack a required clause,113 prompting questions about whether the requirements governed by that clause apply.

In certain circumstances, the courts and boards of contract appeals will “read” required clauses into contracts which lack them, treating the clause as a term of the contract despite its absence. The currently prevailing grounds for reading clauses in is that articulated by the former Court of Claims (currently the U.S. Court of Appeals for the Federal Circuit) in G.L. Christian & Associates v. United States, wherein the court found that certain required contract terms allowing the government to terminate contracts for its convenience were to be read into contracts which lacked them because (1) the terms represented a “deeply ingrained strand of public procurement policy,” and (2) federal regulations can “fairly be read” as permitting the clause to be read into the contract since they require agencies to incorporate the clause.114 Other required FAR clauses that have been read into government contracts under the “Christian doctrine” have included those allowing the government to terminate contracts for default;115 addressing protests after award;116 and governing contractors’ use of government property.117 However, courts have declined to read in other clauses, often when the contractor (as opposed to the government) seeks to rely upon the missing, but required, clause.118 In other cases, courts have relied upon other grounds to read certain terms into government contracts, such as the theory that the government has an “inherent right” to terminate contracts for its convenience.119

quotations omitted); Sturges v. Carter, 114 U.S. 511, 519 (1885) (a retroactive statute is one that “takes away or impairs vested rights acquired under existing laws, or creates a new obligation, imposes a new duty, or attaches a new disability”).111 But see Office of Federal Contract Compliance Programs v. Florida Hospital of Orlando, ARB Case No. 11-011(Oct. 19, 2012) (finding that a statutory provision enacted in 2011, which precluded certain hospitals from being found to be “subcontractors” subject to the jurisdiction of the Office of Federal Contract Compliance Programs, did not have impermissible retroactive effect when applied to a case pending at the time of the statute’s enactment because the statute did not increase any party’s liability for past conduct, or impose any new duties on completed transactions).112 See, e.g., FAR 22.1310(a)(1) (directing contracting officers to “[i]nsert the clause at 52.222–35, EqualOpportunity for Veterans, in solicitations and contracts if the expected value is $150,000 or more,” unless certain exceptions apply).113 See, e.g., Half of Contracts in DOD IG Review Lack Clause Regarding Trafficking in Persons, 95 Fed. Cont. Rep.134 (Feb. 8, 2011) (reporting that the DOD Inspector General (IG) recently found nearly half of a sampling of DOD contracts did not include a required clause intended to combat trafficking in persons).114 G.L. Christian & Assocs. v. United States, 312 F.2d 418, 426-27 (Ct. Cl. 1963).115 Sabre Eng’g Corp., ASBCA No. 24, 133, 81-2 B.C.A. ¶ 15,310.116 COMSI, Inc., ASBCA No. 34,588, 88-1 B.C.A. ¶ 20,245.117 Hart’s Food Serv., Inc., ASBCA No. 34,588, 88-1 B.C.A. ¶ 21,789.118 See, e.g., United States v. Franklin Steel Prods., Inc., 482 F.2d 400 (1973); United States v. Aerodex, Inc., 469 F.2d 1003 (5th Cir. 1973).119 See Russell Motor Car Co. v. United States, 261 U.S. 512, 521 (1923) (“With the termination of the war the continued production of war supplies would become not only unnecessary but wasteful. Not to provide, therefore,


Other Topics

This section addresses agency deviations from the FAR; the ability of third parties to enforce the terms of the FAR against a government contractor; the use of procurement techniques not expressly mentioned in the FAR; and whether agencies or transactions not subject to the FAR could be subject to requirements like those in the FAR.

22. May an acquisition team use a policy or procedure that is not addressed in the FAR?

The FAR authorizes acquisition team members to use any “specific strategy, policy, or procedure” not addressed by the FAR so long as the strategy, policy, or procedure is in the best interests of the government, and is not prohibited by statute, regulation, executive order, or case law.120 This means that agencies are not necessarily limited to the strategies or procedures expressly mentioned in the FAR, but rather may exercise some discretion in structuring procurements to meet agency circumstances and needs. For example, although the FAR nowhere mentions the use of reverse auctions, agencies’ use of reverse auctions in source selection has been upheld on the grounds that “a procurement procedure is permissible where not specifically prohibited.”121

23. Why do contracting officers have to comply with the FAR?

FAR 1.602-1 discusses the authority of contracting officers as follows:

(a) Contracting officers have authority to enter into, administer, or terminate contracts and make related determinations and findings. Contracting officers may bind the Government only to the extent of the authority delegated to them. Contracting officers shall receive from the appointing authority (see 1.603-1) clear instructions in writing regarding the limits of their authority. Information on the limits of the contracting officers’ authority shall be readily available to the public and agency personnel.

(b) No contract shall be entered into unless the contracting officer ensures that all requirements of law, executive orders, regulations, and all other applicable procedures, including clearances and approvals, have been met.

Contracting officers do not have unlimited discretion in how to conduct acquisitions—the grant of authority at FAR 1.602-1(a) is limited by FAR 1.602-1(b). As such, their actions must comply with the FAR or they are unauthorized. Contracting officers acting outside the scope of their authority can be held personally liable for their actions.122

for the cessation of this production when the need for it has passed would have been a distinct neglect of the public interest.”); United States v. Corliss Steam-Engine Co., 91 U.S. 321, 323 (1875) (“[I]t would be of serious detriment to the public service if the power of the head[s] of [federal agencies] did not extend to providing for all … possible contingencies by modification or suspension of the contracts and settlement with the contractors.”).120 FAR 1.102(d) and FAR 1.102-3121 MTB Group, Inc., B-295463 (Feb. 23, 2005). In this case, GAO further noted that the use of reverse auctions is consistent with Part 13 of the FAR, which addresses simplified acquisition procedures.122 See Matter of: John Martino, B-262168, May, 24, 1996 .


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24. What do I do if I am a contract specialist and my contracting officer is not complying with the regulations?

It’s quite common for contract specialists to discover, by training or independent research, that acquisitions they are working on may not be fully compliant with the regulations. Given the sheer volume of the applicable regulations and how often they are changed, it is understandable that contracting officers fall out of compliance due to a lack of knowledge. If this is the case, it is your duty as a contract specialist to bring this to the attention of your contracting officer. This will give the contracting officer the opportunity to correct the noncompliance.

A more difficult situation occurs when the contracting officer takes no action to correct the noncompliance or you find that the noncompliance is by design. This presents an ethical dilemma. Is it ethical to process acquisitions that you know are noncompliant with the regulations as long as you are not signing anything? While some may find comfort in believing the answer to this question is “yes”, being a party to the evasion of legal regulations is contrary to the Standards of Conduct for the Executive Branch.123 In fact, the Standards of Conduct state that “Employees shall disclose waste, fraud, abuse, and corruption to appropriate authorities.”

You primarily have two options for reporting intentional violations of the regulations. The first is reporting the noncompliance up the contracting officer’s chain of command. If the contracting officer is abusing the authority given to him/her, then those who granted that authority should be informed so that the appropriate remedial action can be taken. The second option is to report the noncompliance to the DoD Office of the Inspector General (DoD IG). The DoD IG has a “Defense Hotline” to report fraud, waste, abuse, or mismanagement regarding programs and personnel under the purview of the DoD. No matter which option you choose to report a violation, you will be protected under Whistleblower statutes and you have the option to remain anonymous. If you choose to remain anonymous, then you should provide enough information in your complaint so that an investigation, if necessary, can be effectively conducted.

123 See http://www.oge.gov/Laws-and-Regulations/Employee-Standards-of-Conduct/Employee-Standards-of-Conduct/


http://www.oge.gov/Laws-and-Regulations/Employee-Standards-of-Conduct/Employee-Standards-of-Conduct/

http://www.oge.gov/Laws-and-Regulations/Employee-Standards-of-Conduct/Employee-Standards-of-Conduct/

Organization and Arrangement of the FAR

1. How is the information in the FAR arranged?

Recall that the FAR is a chapter within Title 48 of the CFR. As such, the first division of the FAR is the subchapter. There are eight subchapters in the FAR that are identified using the letters A-H. The next division of the FAR is the part. There are 53 parts in the FAR numbered sequentially, each of which covers a separate aspect of acquisition (see “What does the FAR cover?” in the prior reading for a list of the FAR parts). Most parts are divided into subparts. For example, FAR part 1 is divided as follows:

Part 1—Federal Acquisition Regulations System Subpart 1.1 Purpose, Authority, Issuance Subpart 1.2 Administration Subpart 1.3 Agency Acquisition Regulations Subpart 1.4 Deviations from the FAR Subpart 1.5 Agency and Public Participation Subpart 1.6 Career Development, Contracting Authority, and Responsibilities Subpart 1.7 Determinations and Findings

All parts and subparts contain sections. Some sections are further divided into subsections. For example, FAR subpart 1.1 is divided as follows:

Subpart 1.1—Purpose, Authority, Issuance 1.101 Purpose. 1.102 Statement of guiding principles for the Federal Acquisition System.

1.102-1 Discussion. 1.102-2 Performance standards. 1.102-3 Acquisition Team. 1.102-4 Role of the Acquisition Team.

1.103 Authority. 1.104 Applicability. 1.105 Issuance.

1.105-1 Publication and code arrangement. 1.105-2 Arrangement of regulations. 1.105-3 Copies.

1.106 OMB approval under the Paperwork Reduction Act. 1.107 Certifications. 1.108 FAR conventions. 1.109 Statutory acquisition–related dollar thresholds—adjustment for inflation.1.110 Positive law codification



























In this example, FAR subpart 1.1 is divided into ten sections numbered 1.101 through 1.110. Sections 1.102 and 1.105 are further subdivided into subsections—1.102-1 through -4 and 1.105-1 through -3.

Every part, subpart, section, and subsection has a title. Each FAR part begins with a table of contents that lists the titles of each subpart, section, and subsection contained in the part. These tables of contents are particularly helpful when the use of a search engine to find information is unsuccessful.

2. How does the FAR numbering system work?

The FAR numbering system permits the discrete identification of every FAR paragraph. The digits to the left of the decimal point represent the part number. The numbers to the right of the decimal point and to the left of the dash represent, in order, the subpart (one or two digits), and the section (two digits). The number to the right of the dash represents the subsection. The following example illustrates the make-up of a FAR number citation (note that subchapters are not used with citations):

25.108-2In this example, 25 represents the part, 1 represents the subpart, 08 represents the section, and 2 represents the subsection. Let’s look at another example:

19.1202-3In this example, 19 represents the part, 12 represents the subpart, 02 represents the section, and 3 represents the subsection. Notice that there are four digits to the right of the decimal and to the left of the dash in this example. Since the section is always represented by two digits, the presence of four digits to the right of the decimal point means that, in this citation, the subpart is represented by two digits (a subpart is represented by one or two digits).

3. Is the FAR subdivided below the section or subsection level?

Yes. Subdivisions may be used at the section and subsection level to identify individual paragraphs. Subdivisions below the section or subsection level consist of parenthetical alpha numerics using the following sequence:

(a)(1)(i)(A)(1)(i)(A)

Note that the last three parenthetical alpha numerics are italicized.


4. How do I reference something in the FAR?

The answer depends on what you want to reference—a part, subpart, section, subsection, or paragraph. See the table below.

If you want to reference a—

Using FAR 9.106-4(d) as an example, then you would write the citation—

Part “FAR part 9”Subpart “FAR subpart 9.1”Section “FAR 9.106”Subsection “FAR 9.106-4”Paragraph “FAR 9.106-4(d)”

Notice that when citing a part or subpart, you write the words “part” and “subpart” in the citation. Within the text of the FAR, citations to other information in the FAR do not include “FAR” at the beginning to avoid redundancy (e.g., references to FAR part 9 within the FAR would be written “part 9.”)

5. How general or specific do I need to be when referencing information in the FAR?

FAR 1.105-2(c)(3) describes how to correctly write a citation to a part, subpart, section, subsection, and paragraph contained in the FAR. However, the FAR does not contain guidance on the appropriate level of specificity that a citation should contain. The appropriate level of specificity is dependent on the statement that is being supported by the citation. For example, assume that you wanted to provide a citation to support the following statement:

“The Standard Form 1442 and the Optional Form 1419 are used in contracting for construction.”

The citation that you provide must be specific enough to lead the reader directly to the information in the regulations that supports that statement, but not so specific that it does not fully support the statement. The relevant information to support the original statement in the regulations is shown below:

Subpart 36.7—Standard and Optional Forms for Contracting for Construction, Architect-Engineer Services, and Dismantling, Demolition, or Removal of Improvements

36.700 Scope of subpart. This subpart sets forth requirements for the use of standard and optional forms, prescribed in Part 53 , for contracting for construction, architect-engineer services, or dismantling, demolition, or removal of improvements. These standard and optional forms are illustrated in Part 53 .

36.701 Standard and optional forms for use in contracting for construction or dismantling, demolition, or removal of improvements.




(a) Standard Form 1442 , Solicitation, Offer, and Award (Construction, Alteration, or Repair), shall be used to solicit and submit offers, and award construction or dismantling, demolition, or removal of improvements contracts expected to exceed the simplified acquisition thresholds, and may be used for contracts at or below the simplified acquisition threshold. In all sealed bid solicitations, or when the Government otherwise requires a noncancellable offer acceptance period, the contracting officer shall insert in the blank provided in Block 13D the number of calendar days that the offer must be available for acceptance after the date offers are due. (b) Optional Form 347 , Order for Supplies or Services, may be used for construction or dismantling, demolition, or removal of improvements contracts that are at or below the simplified acquisition threshold; provided, that the contracting officer includes the clauses required (see Subpart 36.5 ) in the simplified acquisitions (see Part 13 ). (c) Contracting officers may use Optional Form 1419 , Abstract of Offers—Construction, and Optional Form 1419A , Abstract of Offers—Construction, Continuation Sheet, or the automated equivalent, to record offers submitted in response to a sealed bid solicitation (see 14.403) and may also use it to record offers submitted in response to negotiated solicitations.

36.702 Forms for use in contracting for architect-engineer services. (a) Contracting officers must use Standard Form 252 , Architect-Engineer Contract, to award fixed-price contracts for architect-engineer services when the services will be performed in the United States or its outlying areas. (b) The SF 330 , Architect-Engineer Qualifications, shall be used to evaluate firms before awarding a contract for architect-engineer services: (1) Use the SF 330 , Part I—Contract-Specific Qualifications, to obtain information from an architect-engineer firm about its qualifications for a specific contract when the contract amount is expected to exceed the simplified acquisition threshold. Part I may be used when the contract amount is expected to be at or below the simplified acquisition threshold, if the contracting officer determines that its use is appropriate. (2) Use the SF 330 , Part II—General Qualifications, to obtain information from an architect-engineer firm about its general professional qualifications.

If you supported your original statement by citing “FAR part 36”, the reader would have to do some considerable searching to find support for your statement. If you cited “FAR subpart 36.7”, you bring the reader closer to the supporting information, but you can still be more specific. The entire subpart covers a number of forms for construction, architect-engineering services, and dismantling, demolition, or removal of improvements, but your citation need only provide support for the use of two such forms that are used for construction. One section, FAR 36.701 contains two paragraphs that support your statement—paragraphs (a) and (c). Citing either “FAR 36.701(a)” or “FAR 36.701(c)” would be too specific, because each paragraph supports only part of your original statement. As such, the best single citation would be at the section level—“FAR 36.701”. (FAR 36.701(a) and (c) would actually be two citations).

6. What information is in a typical FAR part or subpart?

As you discovered earlier, the FAR is divided into subchapters, parts, subparts, sections, and subsections. When reading through the different parts and subparts of the FAR, you’ll notice that certain section titles recur. These common titles are as follows:


https://www.acquisition.gov/far/current/html/FormsStandard28.html#wp1176776





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Scope

Definitions

Applicability

General

Policy

Exceptions (or Exclusions or Limitations)

Procedures; and

Solicitation Provisions and Contract Clauses.124

These sections are not always contained in a particular subpart. Further, many sections have titles that are not one of those listed above. The significance of each of the sections listed above is discussed below.

The “Scope of Part” (or “Scope of Subpart”) Section

At the beginning of every FAR part and some subparts, there will be a section titled “Scope”, which summarizes the information contained in the particular FAR part or subpart. For example, the Scope section for FAR part 8, Required Sources of Supplies and Services, states:

8.000 Scope of part. This part deals with the acquisition of supplies and services from or through

Government supply sources.

As shown above, the Scope section of each part is numbered with three zeroes after the decimal point. If a subpart contains a Scope section, it will be numbered with two zeroes following the subpart number (e.g., a Scope section summarizing FAR subpart 12.3 would be numbered "12.300").

It’s important to read the Scope section of the part and subpart (if the subpart contains a Scope section) before applying a rule to a given acquisition. This is because the Scope section may contain a statement that the rules in the part or subpart apply (or do not apply) to certain types of acquisitions. For example, the Scope section for FAR subpart 26.3 (Historically Black Colleges and Minority Institutions) reads as follows:

124 The FAR Bootcamp® Course Reading, ©2007 by Vernon J. Edwards, p. 10.


26.300 Scope of subpart. (a) This subpart implements Executive Order 12928 of September 16, 1994, which

promotes participation of Historically Black Colleges and Universities (HBCUs) and Minority Institutions (MIs) in Federal procurement.

(b) This subpart does not pertain to contracts performed entirely outside the United States and its outlying areas.

[Bold added].

A novice reader of the FAR may mistakenly believe that a rule contained in FAR subpart 26.3 applied to a contract performed in a foreign country if they only read the rule and did not read the Scope section. This is one of the most common errors made in applying the FAR.

The “Definitions” Section

Some FAR parts and subparts contain a section titled “Definitions” that contains definitions of words and terms that will be used in the particular part or subpart. For example, the Definitions section of FAR part 28, Bonds and Insurance, states:

28.001 Definitions. As used in this part— “Attorney-in-fact” means an agent, independent agent, underwriter, or any other

company or individual holding a power of attorney granted by a surety (see also “power of attorney” at 2.101).

If a part or subpart contains a Definitions section, it will come after the Scope section. If the Definitions section applies to the entire part, it will typically be numbered with “001” after the decimal point (as shown above). If the Definitions section applies to a subpart, it will typically be numbered with “01” after the subpart number (e.g., the Definitions section for FAR subpart 47.2 would be numbered “47.201”).

It’s important to refer to the Definitions section when you are interpreting a rule. The FAR is notorious for defining words and terms differently than how they are commonly understood. The reading “Interpreting the FAR” will further discuss the importance of definitions.

The “Applicability” Section

Some FAR parts and subparts contain a section titled “Applicability” that explains what types of acquisitions the information in the part or subpart applies (or does not apply) to. For example, FAR subpart 46.8 contains an Applicability section that states:

46.801 Applicability. (a) This subpart applies to contracts other than those for (1) information technology,

including telecommunications, (2) construction, (3) architect-engineer services, and (4) maintenance and rehabilitation of real property. This subpart does not apply to commercial items.



(b) See Subpart 46.7 , Warranties, for policies and procedures concerning contractor liability caused by nonconforming technical data.

It’s important to read the applicability section of a part or subpart before applying a rule in the particular part or subpart for the same reason it is important to read the Scope section—to avoid the mistake of misapplying rules to acquisitions. As discussed earlier, sometimes a statement about the applicability of a part or subpart is contained within the Scope section and there is no separate Applicability section.

The “General” Section

Some parts and subparts contain a General section that provides information to orient the reader to the subject matter that will be covered in the part or subpart. This information is more detailed than what is stated in the Scope section. For example, FAR subpart 43.2 contains the following General section at FAR 43.201:

43.201 General. (a) Generally, Government contracts contain a changes clause that permits the

contracting officer to make unilateral changes, in designated areas, within the general scope of the contract. These are accomplished by issuing written change orders on Standard Form 30 , Amendment of Solicitation/Modification of Contract (SF 30 ), unless otherwise provided (see 43.301).

(b) The contractor must continue performance of the contract as changed, except that in cost-reimbursement or incrementally funded contracts the contractor is not obligated to continue performance or incur costs beyond the limits established in the Limitation of Cost or Limitation of Funds clause (see 32.706-2).

(c) The contracting officer may issue a change order by electronic means without a[n] SF 30 under unusual or urgent circumstances, provided that the message contains substantially the information required by the SF 30 and immediate action is taken to issue the SF 30.

Reading the General section is particularly helpful in understanding the context of the rules that appear in the part or subpart.

The “Policy” Section

Many parts and subparts contain a “Policy” section that contains broad statements about the Federal Government’s policy pertaining to the subject matter. For example, FAR subpart 11.5, contains the following Policy section:

11.501 Policy.

(a) The contracting officer must consider the potential impact on pricing, competition, and contract administration before using a liquidated damages clause. Use liquidated damages clauses only when—

(1) The time of delivery or timely performance is so important that the Government may reasonably expect to suffer damage if the delivery or performance is delinquent; and

(2) The extent or amount of such damage would be difficult or impossible to estimate accurately or prove.


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(b) Liquidated damages are not punitive and are not negative performance incentives (see 16.402-2). Liquidated damages are used to compensate the Government for probable damages. Therefore, the liquidated damages rate must be a reasonable forecast of just compensation for the harm that is caused by late delivery or untimely performance of the particular contract. Use a maximum amount or a maximum period for assessing liquidated damages if these limits reflect the maximum probable damage to the Government. Also, the contracting officer may use more than one liquidated damages rate when the contracting officer expects the probable damage to the Government to change over the contract period of performance.

(c) The contracting officer must take all reasonable steps to mitigate liquidated damages. If the contract contains a liquidated damages clause and the contracting officer is considering terminating the contract for default, the contracting officer should seek expeditiously to obtain performance by the contractor or terminate the contract and repurchase (see Subpart 49.4 ). Prompt contracting officer action will prevent excessive loss to defaulting contractors and protect the interests of the Government.

(d) The head of the agency may reduce or waive the amount of liquidated damages assessed under a contract, if the Commissioner, Financial Management Service, or designee approves (see Treasury Order 145-10).

The requirements stated in Policy sections typically derive from statutes, executive

orders, other federal regulations, or official procurement policies of the executive branch.

The “Exceptions” (or “Exclusions” or “Limitations”) Section

Some subparts contain an Exceptions section that state exceptions to rules. For example, FAR subpart 23.1 contains an Exception section that states:

23.104 -- Exceptions.

This subpart does not apply to the following acquisitions:

(a) Contracts performed outside of the United States, unless the agency head determines that such application is in the interest of the United States.

(b) Weapon systems.

Similar to the consequences of failing to read the Scope and Applicability sections, failure to read the Exceptions section may also result in the misapplication of a rule. Some sections titled “Exclusions” or “Limitations” serve the same purpose as the “Exceptions” section.

The Procedures Section

Policy sections usually don’t specifically discuss what agencies have to do to comply with the Government’s policy. This type of information is typically contained in a “Procedures” section. For example, FAR subpart 11.5 contains a Procedures section at FAR 11.502 that




specifically states what needs to be done to implement the Government’s policy for liquidated damages:

11.502 Procedures. (a) Include the applicable liquidated damages clause and liquidated damages rates in

solicitations when the contract will contain liquidated damages provisions.(b) Construction contracts with liquidated damages provisions must describe the

rate(s) of liquidated damages assessed per day of delay. The rate(s) should include the estimated daily cost of Government inspection and superintendence. The rate(s) should also include an amount for other expected expenses associated with delayed completion such as—

(1) Renting substitute property; or (2) Paying additional allowance for living quarters.

The Procedures section provides the details for how the agency is to proceed under a given set of conditions.

The Solicitation Provisions and Contract Clauses Section

At the end of a particular subpart, there will typically be a “Solicitation Provisions and Contract Clauses”, “Solicitation Provisions”, or “Contract Clauses” section that tells agencies which provisions and clauses to insert in solicitations and contracts to implement the Government’s policies and procedures in their solicitations and contracts. For example, FAR subpart 11.5 contains the following “Contract Clauses” section:

11.503 Contract clauses. (a) Use the clause at 52.211-11, Liquidated Damages—Supplies, Services, or

Research and Development, in fixed-price solicitations and contracts for supplies, services, or research and development when the contracting officer determines that liquidated damages are appropriate (see 11.501(a)).

(b) Use the clause at 52.211-12, Liquidated Damages—Construction, in solicitations and contracts for construction, other than cost-plus-fixed-fee, when the contracting officer determines that liquidated damages are appropriate (see 11.501(a)). If the contract specifies more than one completion date for separate parts or stages of the work, revise paragraph (a) of the clause to state the amount of liquidated damages for delay of each separate part or stage of the work.

(c) Use the clause at 52.211-13, Time Extensions, in solicitations and contracts for construction that use the clause at 52.211-12, Liquidated Damages—Construction, when that clause has been revised as provided in paragraph (b) of this section.

This section is particularly helpful when creating a solicitation, as it contains prescriptions for the use of solicitation provisions and contract clauses.


https://www.acquisition.gov/sites/default/files/current/far/html/52_207_211.html#wp1141238


https://www.acquisition.gov/far/current/html/52_207_211.html#wp1141232


https://www.acquisition.gov/far/current/html/52_207_211.html#wp1141225

7. How do I find information in the FAR?

There are a number of ways to find information in the FAR. A novice would probably start by using the search engines available at the FAR Home Page (www.acquisition.gov/far) and at the FARSite (http://farsite.hill.af.mil). Using a commercial search engine such as Google can also be an effective way to search for something in the FAR or DFARS (beware that your results using Google will show pages that were visited the most, which may or may not be the most updated). Another technique is to download the entire FAR in portable document format (PDF) and search for words and terms within the document. However, the usefulness of these techniques is limited to your ability to choose good key words and terms, which can be difficult. Lastly, there is an official FAR Index available online (www.acquisition.gov/far) that contains a list of key words and terms used in the FAR and a reference to where in the FAR those words and terms are located. However, as of this writing, the FAR Index has not been updated in over six years. As such, it contains some outdated information.

Perhaps the most efficient way to find information in the FAR is to generally know what information is in the FAR and where it is located (usually gained through years of experience using the FAR). For example, assume you were to ask someone who was skilled at using the FAR “What happens if the Government lets a contractor use some of its equipment and the contractor breaks it?” The person may not know the answer off the top of their head, but they would know that there is a part within the FAR that is dedicated to the topic of Government property (FAR part 45). They would then review the table of contents for FAR part 45 to narrow down their search to one or two subparts or sections. This process would probably take less time and effort than trying to come up with the right key words and using an index or a search engine.

Another method if you did not know what FAR part covers Government Property, would be to access the HAFB FARSite, click on the “Regs” Tab and select FAR. You will see the following table of FAR parts. The title of each FAR part appears as you mouse over each part; e.g. Part 45 is Government Property. Clicking on the Part 45 returns the Part’s index. Then you can read down the list or hit (Ctrl+F) to highlight the subject of interest in the list or in the remainder of the Part.


http://www.acquisition.gov/far


http://www.acquisition.gov/far

FAR Research Exercise

Answer each question below by citing the exact reference in the FAR where the information can be found. Depending on how specific the question is worded, the correct citation may be to a part, subpart, section, subsection, paragraph, or subparagraph. The citation you provide must comply with the format requirements at FAR 1.105-2(c) and take the reader directly to the information requested. Some questions are worded in a way that would be commonly heard in an office environment—not using the same words and terms you might encounter in the FAR. Do not cite anything in FAR subpart 52.2 in your answer.

1. Where in the FAR does it say what you’re supposed to do in the first step when using two-step sealed bidding?

2. Where in the FAR does it say when to use the special contract clause dealing with taxes when performing vessel repair in North Carolina?

3. Where in the FAR does it talk about a small business concern rerepresenting itself during contract performance?

4. Where in the FAR are the procedures for contracting officer determination of final indirect cost rates when utilizing a cost reimbursement type of contract?

5. Where in the FAR are the policies and procedures for using special contracting methods?

6. Where in the FAR is the acquisition of Architect-Engineer services covered?

7. Where in the FAR are contract modifications covered?


8. What’s the general difference between customary and unusual progress payments?

9. If funds are required from another agency, can an agency approve a request for extraordinary contractual relief before finding out if adequate funds are available?

10. What guidance provides principles for determining the costs applicable to research and development performed by educational institutions under contract with the Government?

11. When reviewing a contractor’s purchasing system, do you have to review their policies pertaining to small business concerns?

12. When would a short-form preaward survey report be appropriate?

13. What is the simplified acquisition threshold for acquisitions of supplies for defense against an NCBR attack?

14. When settling a FPI(F) contract that was completely terminated for convenience, how does the contracting officer establish prices for items that were delivered and accepted?


DFARS Basics

1. What is the Defense Federal Acquisition Regulation Supplement (DFARS)?

DoD implementation and supplementation of the FAR is issued in the DFARS under authorization and subject to the authority, direction, and control of the Secretary of Defense. The DFARS contains—

(i) Requirements of law;

(ii) DoD-wide policies;

(iii) Delegations of FAR authorities;

(iv) Deviations from FAR requirements; and

(v) Policies/procedures that have a significant effect beyond the internal operating procedures of DoD or a significant cost or administrative impact on contractors or offerors.

The DFARS is located in Chapter 2 of Title 48 of the CFR.

2. What are Implementation and Supplementation?

The DFARS implements and supplements the FAR. The DFARS implements the FAR when it adds more specific information to information stated in the FAR. For example, FAR 19.505(b) states the following:

The SBA procurement center representative (or, if a procurement center representative is not assigned, see 19.402(a)) may appeal the contracting officer’s rejection to the head of the contracting activity (or designee) within 2 working days after receiving the notice. The head of the contracting activity (or designee) shall render a decision in writing, and provide it to the SBA representative within 7 working days. Pending issuance of a decision to the SBA representative, the contracting officer shall suspend action on the acquisition.

This rule applies to all executive agencies subject to the FAR. For DoD, this rule is implemented at DFARS 219.505(b) as follows:

The designee shall be at a level no lower than chief of the contracting office.

In this case, DoD has placed a limit on how far down this particular delegation can go. When reading the FAR, a DoD contracting officer must always check the DFARS to see how a requirement in the FAR is to be implemented in DoD. This is especially critical because a rule in the FAR may not apply to DoD, or DoD may change the way the rule is applied. For example, let’s say you wanted to know what the customary progress payment rate was for small business concerns. FAR 32.501-1(a) states:

The customary progress payment rate is 80 percent, applicable to the total costs of performing the contract. The customary rate for contracts with small business concerns is 85 percent.



However, if you concluded that the customary progress payment rate for small business concerns was 85 percent you would be wrong. FAR 32.501-1(a) is implemented at DFARS 232.501-1(a) as follows:

The customary progress payment rates for DoD contracts, including contracts that contain foreign military sales (FMS) requirements, are 80 percent for large business concerns and 90 percent for small business concerns.

This phenomenon makes reading the regulations particularly tricky. The lesson is that whenever you read the FAR, you must make a habit of reading the DFARS to see how the FAR is to be implemented in DoD.

The DFARS supplements the FAR when it adds policies and procedures that are not covered in the FAR. For example, DFARS subpart 219.71, Pilot Mentor-Protégé Program, supplements FAR part 19, Small Business Programs. The purpose of the Program is to provide incentives for DoD contractors to assist protégé firms in enhancing their capabilities and to increase participation of such firms in Government and commercial contracts. There is no coverage of this program in the FAR.

3. How do I know if the DFARS is implementing or supplementing the FAR?

It depends on how the text in the DFARS is numbered. If it has supplemental numbering, then the text is supplemental. If it has implemental numbering, then it is either implemental or supplemental. DFARS 201.303(a)(ii) states the following policy:

To the extent possible, all DFARS text (whether implemental or supplemental) is numbered as if it were implemental. Supplemental numbering is used only when the text cannot be integrated intelligibly with its FAR counterpart.

4. How is implemental and supplemental text numbered?

The table below illustrates how implemental and supplemental text is numbered.

DFARS NUMBERING

FAR Is Implemented As Is Supplemented As125

19 219 219.7019.5 219.5 219.57019.501 219.501 219.501-7019.501-1 219.501-1 219.501-1-7019.501-1(a) 219.501-1(a) 219.501-1(a)(S-70)19.501-1(a)(1) 219.501-1(a)(1) 219.501-1(a)(1)(S-70)

As shown in the second column, implemental numbering is the same as its FAR counterpart with the addition of a “2” in the beginning. The “2” denotes the chapter (recall that the DFARS is Chapter 2 of Title 48). Supplemental numbering is the same as its FAR counterpart, with the addition of a “2” at the beginning and a number of 70 and up or (S-70) and up at the end. Parts, subparts, sections, or

125 Note that FAR parts are supplemented by DFARS subparts, FAR subparts are supplemented by DFARS sections, FAR sections are supplemented by DFARS subsections, etc.


http://www.acq.osd.mil/dpap/dars/dfars/html/current/219_5.htm#219.501-1




subsections are supplemented by the addition of a number of 70 and up. Lower divisions are supplemented by the addition of a number of (S-70) and up.

5. Do subdivisions below the section or subsection level follow the same parenthetical alphanumeric sequence as the FAR?

Generally, yes. However, in situations where implemental text exceeds one paragraph, the subdivisions are numbered by skipping a unit in the FAR prescribed numbering sequence. For example, three paragraphs implementing FAR 19.501 would be numbered 219.501(1), (2), and (3) rather than (a), (b), and (c). Three paragraphs implementing FAR 19.501(a) would be numbered 219.501(a)(i), (ii), and (iii) rather than (a)(1), (2), and (3). Further subdivision of the paragraphs follows the prescribed numbering sequence, e.g., 219.501(1)(i)(A)(1)(i).

6. How do I reference text in the DFARS?

The DFARS doesn’t contain rules on how to write citations, but for the sake of consistency you should write citations similar to the way you would write a FAR citation, as illustrated below.

If you want to reference a—

Using DFARS 209.106-4(d) as an example, then you would write the citation—

Part “DFARS part 209”Subpart “DFARS subpart 209.1”Section “DFARS 209.106”Subsection “DFARS 209.106-4”Paragraph “DFARS 209.106-4(d)”

7. What is the DFARS Procedures, Guidance, and Information (PGI)?

The DFARS PGI is a companion resource to the DFARS that—

(1) Contains mandatory internal DoD procedures. The DFARS will direct compliance with mandatory procedures using imperative language such as “Follow the procedures at...” or similar directive language;

(2) Contains non-mandatory internal DoD procedures and guidance and supplemental information to be used at the discretion of the contracting officer. The DFARS will point to non-mandatory procedures, guidance, and information using permissive language such as “The contracting officer may use...” or “Additional information is available at...” or other similar language;

(3) Is numbered similarly to the DFARS, except that each PGI numerical designation is preceded by the letters “PGI”; and

(4) Is available electronically at http://www.acq.osd.mil/dpap/dars/dfarspgi/current/index.html.

The DFARS PGI is not part of the CFR.


http://www.acq.osd.mil/dpap/dars/dfarspgi/current/index.html

http://www.acq.osd.mil/dpap/dars/dfars/html/current/219_5.htm#219.501



8. How do I find information in the DFARS?

There is no official index for the DFARS. The official DFARS at the Director of Defense Procurement Web site does not have a particularly useful search engine. However, the FARSite (http://farsite.hill.af.mil) has a decent search engine that can simultaneously search the FAR and the DFARS. However, the FARSite is not official (although it is generally reliable). As stated earlier regarding searching the FAR, the best way to search is to generally know where to look.

9. Who is responsible for maintaining the DFARS and the DFARS PGI?

The DAR Council is responsible for maintaining both.



FAR/DFARS Research Exercise

Answer each question below and provide a citation to the exact reference in the FAR, DFARS, or DFARS PGI where the information supporting your answer can be found. The citation you provide must comply with the format requirements at FAR 1.105-2(c) and take the reader directly to the information supporting your answer. Some questions are worded in a way that would be commonly heard in an office environment—not using the same words and terms you might encounter in the regulations. Assume that each question applies to a DoD acquisition. Do not cite anything in FAR subpart 52.2 or DFARS subpart 252.2.

1. Where does it say that you can’t use contracts to perform inherently governmental functions?

2. Where does it say that agencies must have procedures for funding and paying the contractor’s share of savings that result from value engineering?

3. Where does it say how long a contracting officer has to accept or reject a VECP?

4. Where does it say how much employer’s liability insurance a contractor should have under a cost-reimbursement contract?

5. As required by Section 807 of the National Defense Authorization Act for Fiscal Year 2005, how often are statutory acquisition-related dollar thresholds reviewed to calculate adjustment for inflation?

6. How long does a contract adjustment board have to render a decision on a request for extraordinary contractual relief?


7. Where does it say that R&D contractors shouldn’t subcontract any technical or scientific work without the contracting officer’s advance knowledge?

8. Where does it say that Pre-award Peer Reviews for competitive acquisitions shall be conducted before issuing the solicitation, requesting final proposal revisions and awarding the contract?

9. What information should be provided in addition to the Contracting Officer's Signature on contracts and modifications?

10. Are performance and payment bonds required in cost-reimbursement construction contracts?

11. RESERVED

12. Does the DUNS number or DUNS+4 have to be provided on contractual documents submitted to the payment office?

13. Where does it require the content of the justification for non-competitive follow-on acquisitions of supplies or services previously awarded on a non-competitive basis, include a copy of the previous justification to assist the approval authority in determining whether the planned actions to remove any barriers to competition cited on the previous justification were completed?

14. What instruction should be used in preparing the determination described at FAR 7.503(e)?


Deviations from the FAR and DFARS

Agencies are authorized to deviate from the FAR and/or DFARS under certain circumstances. A deviation involves agency noncompliance with a mandatory procurement regulation (e.g., using a solicitation provision or contract clause that is inconsistent with the FAR), in the absence of a statute expressly requiring or authorizing such noncompliance.126 Only those deviations authorized by the FAR are permitted.127 Contracting officers must use the Authorized Deviations in Provisions clause and the Authorized Deviations in Clauses clause to notify offerors and contractors when a solicitation or contract contains a deviation.128

Deviations may be granted (as discussed below) when necessary to meet the agency’s specific needs and requirements, so long as not precluded by law, executive order, or regulation.129 The FAR recognizes two types of deviations: individual and class. Individual deviations affect only individual contract actions.130 They may generally be authorized by the agency head, with the contracting officer required to document the justification and agency approval in the contract file.131 Class deviations affect multiple contract actions.132 For civilian agencies (other than NASA), deviations may generally be authorized by agency heads or their designees after consultation with the Civilian Agency Acquisition Council (CAAC).133 Additionally, a copy of each class deviation must be provided to the FAR Secretariat.134 For DOD, the FAR provides that class deviations will be done in accordance with DFARS,135 which generally grants the Director of Defense Procurement and Acquisition Policy the authority to issue them.136 If any agency requires a permanent class deviation, then it should propose a FAR revision when appropriate.137

There are many active class deviations. While most class deviations are temporary, many are not. Currently there are active class deviations which are over six (6) years old. Class deviations

126 FAR subpart 1.4; see also FAR 1.401 (defining “deviation” as (1) issuing or using a policy, procedure,solicitation provision, contract clause, method, or practice of conducting acquisition actions of any kind at any stage of the acquisition process that is inconsistent with the FAR; (2) omitting a FAR-prescribed solicitation provision orcontract clause; (3) using a solicitation provision or contract clause with modified or alternate language not authorized by the FAR; (4) using a FAR-prescribed solicitation provision or contract clause on a substantially-as-follows or substantially-the-same-as basis if inconsistent with the intent, principle, or substance of the FAR; (5) authorizing lesser or greater limitations on the use of any FAR-prescribed solicitation provision, contract clause, policy, or procedure; and (6) issuing certain policies or procedures that are not incorporated into the agency’s FAR supplement).127 See Gold Line Ref. v. United States, 54 Fed. Cl. 285 (2002) (holding that an agency’s unauthorized deviation from the FAR regarding pricing sources for an economic price adjustment was unenforceable, and thus the contractor was entitled to damages).128 FAR 52.107129 FAR 1.402. Deviations are not authorized with respect to the Cost Accounting Standards regulations for solicitation provisions and contract clauses (FAR 30.201) or the Cost Accounting Standards Board regulations (48 C.F.R. Chapter 99). See id.130 FAR 1.403131 See id.132 FAR 1.404133 FAR 1.404(a)(1)134 FAR 1.404135 FAR 1.404(b)136 DFARS 201.402, 202.404. 137 FAR 1.404


are especially tricky because they may require DoD contracting officers to follow a policy or procedure that is different than what is stated in the FAR or DFARS. For example, assume that you were contemplating the award of a contract for noncommercial services that you were expecting to cost $800,000 and wanted to know if you would be required to evaluate past performance during source selection. FAR 15.304(c) states:

“(3)(i) Except as set forth in paragraph (c)(3)(iii) of this section, past performance shall be evaluated in all source selections for negotiated competitive acquisitions expected to exceed the simplified acquisition threshold.

(ii) For solicitations involving bundling that offer a significant opportunity for subcontracting, the contracting officer must include a factor to evaluate past performance indicating the extent to which the offeror attained applicable goals for small business participation under contracts that required subcontracting plans (15 U.S.C. 637(d)(4)(G)(ii) ).

(iii) Past performance need not be evaluated if the contracting officer documents the reason past performance is not an appropriate evaluation factor for the acquisition.”

DFARS 215.304(c) doesn’t contain any text that changes the threshold for evaluating past performance that is stated in the FAR, so it would appear that you would be required to evaluate past performance during source selection, because your acquisition would exceed the simplified acquisition threshold. However, that is incorrect. DoD has a class deviation from FAR 15.304(c)(3)(i) that changes the applicable threshold (see Class Deviation 2013-O0018 ). For DoD, FAR 15.304(c)(3)(i) reads as follows:

“(c) (3) (i) In lieu of the threshold specified at FAR 15.304(c)(3)(i), except as provided at FAR 15.304(c)(3)(iii), evaluate past performance in source selections for negotiated competitive acquisitions as follows—

(A) For systems and operations support acquisitions expected to exceed $5,000,000;(B) For services and information technology acquisitions expected to exceed $1,000,000;

and (C) For ship repair and overhaul acquisitions expected to exceed $500,000. ”

NOTE: The Governmentwide CPARS guidance lists various business sectors. DoD includes health care under the services business sector and includes fuels under the operations support business sector.

Class deviations, especially those that are mandatory, add an extra layer of complexity to determining what information is applicable to a DoD acquisition. Not only must DoD contracting officers research the FAR and the DFARS, they also must research class deviations to determine whether they have been directed to deviate from a requirement in the FAR or DFARS. Further, some class deviations place requirements on acquisitions that are in addition to the requirements in the FAR and DFARS.

Class deviations are not always easy to find. The FARSite (farsite.hill.af.mil) has embedded references to some, but not all, class deviations in its online versions of the FAR and DFARS. The online version of the DFARS at the DPAP website (http://www.acq.osd.mil/dpap/) also contains references to some, but not all, class deviations. Both sites have contained references to class deviations that are no longer effective.


http://www.acq.osd.mil/dpap/

http://uscode.house.gov/uscode-cgi/fastweb.exe?getdoc+uscview+t13t16+492+90++(15)%20%20AND%20((15)%20ADJ%20USC)%3ACITE%20%20%20%20%20%20%20%20%20

Some class deviations are not referenced anywhere in the FAR or DFARS, but are still applicable. The official repository for class deviations is at the following DPAP website which has the documents available for download in portable document format (PDF) as separately scanned documents. (http://www.acq.osd.mil/dpap/dars/class_deviations.html).

Lastly, there is also a key word searchable PDF file available during class that is uploaded to the Student Share drive (L Drive) that contains all class deviations integrated into one document that is book-marked to each class deviation and includes summaries of each class deviation.

FAR/DFARS/Class Deviations Research Exercise

Answer each question below and provide a citation to the exact reference in the FAR, DFARS, DFARS PGI, or class deviation where the information supporting your answer can be found. FAR, DFARS, and DFARS PGI citations must comply with the format requirements at FAR 1.105-2(c) and take the reader directly to the information supporting your answer. Some questions are worded in a way that would be commonly heard in an office environment—not using the same words and terms you might encounter in the regulations. Assume that each question applies to a DoD acquisition. Do not cite anything in FAR subpart 52.2 or DFARS subpart 252.2.

1. Where does it say that, when negotiating contract price, the contracting officer doesn’t have to reach agreement on every element of cost in order to negotiate a fair and reasonable price?

2. Where does it say that it’s considered contrary to public policy for contractors to pay a commission to someone that’s contingent on that person getting the contractor a Government contract?

3. Where does it say that DoD should try to provide any required precious metals to contractors instead of having the contractor buy them on their own?

4. Where does it say that when using Federal Supply Schedules, the contracting officer is required to make a separate determination of fair and reasonable pricing using the proposal analysis techniques at FAR 15.404-1?


http://www.acq.osd.mil/dpap/dars/class_deviations.html

5. Where in the FAR are the policies and procedures for gathering information from offerors to assist the Government in planning the most economic quantities in which supplies should be purchased?

6. Where does it say that contracting officers shall use provision DFARS 252.236-7010, Overseas Military Construction--Preference for United States Firms, when contract performance estimated to exceed $1,000,000 will be in a United States outlying area in the Pacific or in a country bordering the Arabian Gulf?

7. When are you supposed to include DFARS 252.209-7999 in a solicitation?

8. Where does it say that you can get out of some of the requirements in FAR part 31 if the contract will be for utilities privatization?

9. Where does it say when you don’t have to get certified cost or pricing data when buying telecommunications services?

10. If you’re awarding an order under a basic ordering agreement and it has a subcontracting plan, does the contractor submit its individual subcontracting reports through eSRS or do they submit an SF 294?

11. Where does it say that you can’t make an offeror submit information about its political spending as part of a solicitation?

12. What is the SAT when making purchases outside the U.S. in support of a humanitarian or peacekeeping operation?


Interpreting the FAR

So far you have primarily focused on developing the critical skill of locating information in the FAR, DFARS (including DFARS PGI), and class deviations. The next critical skill that you must develop to effectively use the regulations is interpretation. FAR 1.108 states a number of conventions that provide guidance for interpreting the FAR. Each of these conventions is discussed below.

(a) Words and terms. Definitions in Part 2 apply to the entire regulation unless specifically defined in another part, subpart, section, provision, or clause. Words or terms defined in a specific part, subpart, section, provision, or clause have that meaning when used in that part, subpart, section, provision, or clause. Undefined words retain their common dictionary meaning.

One of the most common mistakes made by novice readers of the FAR is to rely on their preconceived notions of what words and terms mean instead of relying on the definitions contained in the FAR. When it comes to interpreting the meaning of a word or term used in the FAR, reliance on intuition is often fatal. When reading a particular part, subpart, section, provision, or clause in the FAR, one must have the discipline to check if any of the words or terms used are defined in the particular part, subpart, section, provision, or clause. If a word or term is not defined in a particular part, subpart, section, provision, or clause, then one must check to see if FAR part 2, Definitions of Words and Terms, contains a definition of the word or term.

(b) Delegation of authority. Each authority is delegable unless specifically stated otherwise (see 1.102-4(b)).

The FAR will often authorize a high-level official, such as the agency head or the head of the contracting activity to perform certain actions. In such instances, the reader is to assume that the authority given to the high-level official can be delegated, unless the FAR specifically says it cannot. In some instances, the FAR will authorize an “agency head (or designee)” to do something. Given this reading convention, the “(or designee)” is entirely unnecessary.

(c) Dollar thresholds. Unless otherwise specified, a specific dollar threshold for the purpose of applicability is the final anticipated dollar value of the action, including the dollar value of all options. If the action establishes a maximum quantity of supplies or services to be acquired or establishes a ceiling price or establishes the final price to be based on future events, the final anticipated dollar value must be the highest final priced alternative to the Government, including the dollar value of all options.

Many requirements in the FAR are dependent on the anticipated dollar value of the acquisition. In many cases, determining the anticipated dollar value is fairly straightforward. In other cases, determining the anticipated dollar value is more difficult. For example, in variable quantity contracts (e.g., indefinite quantity, requirements, options) agencies can only roughly estimate how much they will order or whether they will exercise any options. In such cases, agencies are to use the maximum dollar value that the acquisition could possibly be when applying rules tied to dollar thresholds unless otherwise specified.




(d) Application of FAR changes to solicitations and contracts. Unless otherwise specified— (1) FAR changes apply to solicitations issued on or after the effective date of the change; (2) Contracting officers may, at their discretion, include the FAR changes in solicitations issued before the effective date, provided award of the resulting contract(s) occurs on or after the effective date; and (3) Contracting officers may, at their discretion, include the changes in any existing contract with appropriate consideration.

The FAR changes quite often. However, it is impractical for contracting officers to amend solicitations that have already been issued to incorporate FAR changes. As such, the FAR excepts solicitations that have already been issued from having to conform to subsequent changes in the FAR.

(e) Citations. When the FAR cites a statute, Executive order, Office of Management and Budget circular, Office of Federal Procurement Policy policy letter, or relevant portion of the Code of Federal Regulations, the citation includes all applicable amendments, unless otherwise stated.

This is self-explanatory.

(f) Imperative sentences. When an imperative sentence directs action, the contracting officer is responsible for the action, unless another party is expressly cited.

The FAR will often require “agencies” to do something or use the passive voice without specifying a subject (e.g., “the file shall be documented”). In these cases, and in others where another party is not expressly cited, the reader is to assume that the contracting officer is responsible for the action.

In addition to gaining familiarity with the FAR conventions at FAR 1.108, it may also be useful to familiarize yourself with the canons of statutory construction.138 One such rule—expressio unuius est exclusio alterius (the inclusion of one is the exclusion of others)—can be particularly helpful when trying to interpret the regulations. For example, consider the following instruction at FAR 2.201:

Insert the clause at 52.202-1, Definitions, in solicitations and contracts that exceed the simplified acquisition threshold.

What if the solicitation and contract does not exceed the simplified acquisition threshold (SAT)? Would you be required to include the clause? Although the FAR does not expressly state what to do in this situation, we can infer that the clause would not be required by applying expressio unuius est exclusio alterius. In other words, because the rule instructs you to include the clause in a defined group of solicitations and contracts (those greater than the SAT), you should interpret that to mean that the rule does not apply to solicitations and contracts outside the defined group. For a more in-depth discussion of the canons of statutory construction, see CRS Report for Congress, Statutory Interpretation: General Principles and Recent Trends, by Yule Kim.

138 The rules of statutory construction apply when interpreting regulations. Williams v. Chu, 641 F.Supp.2d 31, 38 (D.D.C. 2009).


http://www.fas.org/sgp/crs/misc/97-589.pdf

http://farsite.hill.af.mil/reghtml/regs/far2afmcfars/fardfars/far/52_000.htm#P104_16535

FAR Interpretation Exercise

Instructions: Answer each question below and provide a proper FAR or DFARS reference to support your answer.

1. Are subcontracting plans required for contracts performed entirely in Tonga?

2. If an offeror receives notice of its exclusion from the competition on Wednesday, August 29, 2012, what would be the deadline for requesting a preaward debriefing?

3. Can a contractor submit a claim by e-mail?

4. FAR 15.404-1(a)(2) and FAR 15.404-1(a)(3) state the following, respectively:

“Price analysis shall be used when certified cost or pricing data are not required.”

“Cost analysis shall be used to evaluate the reasonableness of individual cost elements when certified cost or pricing data are required. Price analysis should be used to verify that the overall price offered is fair and reasonable.”

TRUE or FALSE (Choose one): Based on the above, price analysis is always required.

5. What is the micro-purchase threshold in Puerto Rico for the acquisition of services to be used in defense against a radiological attack?

6. Does the Buy American statute apply to the construction of a public building in Puerto Rico?


7. FAR 12.102(f)(1) allows contracting officers to treat any acquisition of supplies or services that, as determined by the head of the agency, are to be used to facilitate defense against or recovery from cyber, nuclear, biological, chemical, or radiological attack, as an acquisition of commercial items. Can this authority be delegated to the Heads of Contracting Activities?

8. A noncommercial contract is contemplated that will contain a base year and four options. It is anticipated that the value of the base year will be $500,000 and that each option year will be worth $500,000. The contract will be an indefinite delivery indefinite quantity contract with a guaranteed minimum of $3,000. Is the clause at DFARS 252.205-7000, Provision of Information to Cooperative Agreement Holders, required?

9. Who is responsible for returning bid samples that have not been destroyed in testing to bidders when requested as required by FAR 14.202-4(g)(1)?

10. A contracting officer issues a solicitation on January 9, 2015 that requests offers by February 9, 2015. The expected value of the acquisition is $5 million. On January 19, 2015, the FAR is changed to require a new contract clause in solicitations and contracts valued above the simplified acquisition threshold. The Federal Register notice accompanying the final rule is silent on whether current solicitations must be amended to incorporate the new clause. Does the CO have to amend the solicitation to include the new clause?

11. Who is responsible for notifying Congress as described at FAR 6.302-7(c)(2) when applicable?


Determining the Applicability of Rules

Thus far, you have begun to develop the critical skills of researching and interpreting the regulations. The next critical skill you need to develop is the ability to determine the applicability of a given rule to a given acquisition. Perhaps the most common mistake made by novice readers of the FAR is to misapply a rule to an acquisition. As such, you must be observant of the breadth of a given rule and the relevant facts about a given acquisition.

According to FAR 1.104, the FAR applies to all “acquisitions” as defined in FAR part 2, except where expressly excluded. However, most of the individual rules contained in the FAR apply to a defined subset of all acquisitions. The subset may be defined, for example, in terms of dollar value (e.g., all acquisitions exceeding the simplified acquisition threshold), location of performance (e.g., all acquisitions performed inside the United States), or what is being acquired (e.g., all acquisitions for construction). To illustrate this point, see FAR 22.400:

This subpart implements the statutes which prescribe labor standards requirements for contracts in excess of $2,000 for construction, alteration, or repair, including painting and decorating, of public buildings and public works. (See definition of “Construction, alteration, or repair” in section 22.401.) Labor relations requirements prescribed in other subparts of Part 22 may also apply.

The subset of acquisitions to which the rules in the subpart apply is defined by both dollar value (i.e., “in excess of $2,000”) and by what is being acquired (i.e., “construction, alteration, or repair, including painting and decorating, of public buildings and public works”). The subset of all acquisitions may also be defined by an express statement of exceptions to or exemptions from the rule. For example, FAR 39.203(a) states:

Unless an exception at 39.204 applies, acquisitions of EIT supplies and services must meet the applicable accessibility standards at 36 CFR Part 1194.

Express statements of the applicability of or exceptions to a given rule can appear anywhere in a given part, if at all. As such it helps to develop a habit of looking for such statements before applying a rule to a given acquisition.

Determining Applicability of a Rule—Remember to “Zoom Out”

Throughout this module, you have developed the skill of finding rules and providing the locations of those rules in the form of citations. This is similar to finding houses and providing the addresses. When determining the applicability of a rule, there is more work to do. Much like “zooming out” after finding an address using mapping software, you have to “zoom out” to the next-higher level (e.g., from subsection to section) where the rule appears, looking for express statements of the applicability of or exceptions to the rule. Then, you must “zoom out” to the subpart level, and continue the search by looking for sections titled “Scope of Subpart”, “Applicability”, “Exceptions”, “Exemptions”, “Exclusions”, “Waiver”, etc. Finally, we must “zoom out” to the part level and read the “Scope of Part”, and “Applicability” sections. You should also look at the titles to the subparts, as some parts may contain an entire subpart that discusses the applicability of subsequent subparts. Keep in mind that it is still necessary to check the DFARS and the class deviations, as these may affect the applicability of rules.



http://farsite.hill.af.mil/reghtml/regs/far2afmcfars/fardfars/far/22.htm#P149_23441

Let’s take a look at the “zoom-out” process in action. Assume that you have a requirement to purchase uncoated printing paper and you have been asked to find out if there’s a rule requiring a certain percentage of the paper to be composed of recycled material. As such, you locate the rule stated at FAR 11.303(a)(2):

Section 2(e)(iv) of Executive Order 13514 requires acquisition of uncoated printing and writing paper containing at least 30 percent postconsumer fiber.

Is the paper that you are acquiring required to contain 30 percent postconsumer fiber? Many would answer “yes” at this point without searching any further. As you will see, this makes you susceptible to misapplying the rule.

Instead of answering, you should zoom-out to the next-higher level, which would be FAR 11.303(a):

(a) The following applies when agencies acquire paper in the United States (as defined in 23.001):

(1) Section 2(d)(ii) of Executive Order 13423, Strengthening Federal Environmental, Energy, and Transportation Management, establishes a 30 percent postconsumer fiber content standards for agency paper use. Section 2(d)(ii) requires that an agency's paper products must meet or exceed the minimum content standard.

(2) Section 2(e)(iv) of Executive Order 13514 requires acquisition of uncoated printing and writing paper containing at least 30 percent postconsumer fiber.

Note the express statement of applicability at the beginning of the paragraph. If you had not read this, you may have assumed the rule applied outside the United States. Let’s assume that you will be purchasing paper in the United States. Is the paper required to contain 30 percent postconsumer fiber? Again, answering “yes” at this point makes you susceptible to misapplying the rule.

Instead of answering, you should zoom-out to the next-higher level, which would be FAR 11.303:

11.303 – Special Requirements for Paper.

(a) The following applies when agencies acquire paper in the United States (as defined in 23.001):

(1) Section 2(d)(ii) of Executive Order 13423, Strengthening Federal Environmental, Energy, and Transportation Management, establishes a 30 percent postconsumer fiber content standards for agency paper use. Section 2(d)(ii) requires that an agency's paper products must meet or exceed the minimum content standard.

(2) Section 2(e)(iv) of Executive Order 13514 requires acquisition of uncoated printing and writing paper containing at least 30 percent postconsumer fiber.

(b) Exceptions. If paper under paragraphs (a)(1) or (a)(2) of this section containing at least 30 percent postconsumer fiber is not reasonably available, does not meet reasonable performance requirements, or is only available at an unreasonable price, then the agency must purchase--




(1) Printing and writing paper containing no less than 20 percent postconsumer fiber; or

(2) Paper, other than printing and writing paper, with the maximum practicable percentage of postconsumer fiber that is reasonably available at a reasonable price and that meets reasonable performance requirements.

Note the exceptions to the rule at FAR 11.303(b). If you had not read this, you would not be aware that there were any exceptions to the rule. Let’s assume that neither of the exceptions applies to your requirement. Is the paper that you are going to purchase required to contain 30 percent postconsumer fiber? Again, answering “yes” at this point makes you susceptible to misapplying the rule.

Instead of answering, you should zoom-out to the next-higher level, which would be FAR subpart 11.3, and scan the section titles for titles such as “Scope of Subpart”, “Applicability”, “Exceptions”, “Exemptions”, “Exclusions”, “Waiver”, etc:

Subpart 11.3 -- Acceptable Material.

11.301 – Definitions.

11.302 -- Policy.

11.303 – Special Requirements for Paper.

11.304 – Contract Clause.

As shown above, there are no such section titles. So, is the paper required to contain 30 percent postconsumer fiber? Again, answering “yes” at this point makes you susceptible to misapplying the rule.

Instead of answering, we should zoom-out to the next-higher level, which would be FAR part 11 and look for sections preceding the first subpart titled “Scope of Part”, “Applicability” “Exceptions”, “Exemptions”, “Exclusions”, “Waiver”, etc. FAR 11.000 states:

11.000 -- Scope of Part.

This part prescribes policies and procedures for describing agency needs.

Note that FAR part 11 does not contain an “Applicability” section in the beginning and none of the FAR sections preceding FAR subpart 11.1 contain any information affecting the applicability of the rule. So, is the paper that you are going to purchase required to contain 30 percent postconsumer fiber? Again, answering “yes” at this point makes you susceptible to misapplying the rule. You need to repeat the process of zooming out in the DFARS and you must also check if there are any class deviations affecting the applicability of the rule. In this scenario, neither the DFARS nor the class deviations affect the applicability of the FAR rule. Based on this, we need to know the following about the acquisition:







1. Will you be acquiring paper inside the United States?2. Is the paper reasonably available?3. If available, does the paper meet performance requirements?4. Is the paper available at a reasonable price?

Answering “no” to any of these questions would make this rule inapplicable. If you can answer “yes” to all questions, then the rule is applicable.


FAR Reading Exercise

Instructions: Read each scenario below and answer the corresponding question. Provide citations to support your answer.

1. A contracting officer is drafting a solicitation for the acquisition of telecommunications services inside the United States. Is the contracting officer required to include the clause at FAR 52.241-2, Order of Precedence—Utilities, in the solicitation?

2. A contracting officer has a requirement for a USDA-designated item valued at $10,000. The item was recently designated by USDA and has not been purchased by the agency before. Assuming that none of the exemptions at FAR 23.404(b) apply, is the contracting officer required to purchase a conforming product?

3. A contracting officer is contemplating the award of a contract for the delivery of supplies valued at $250,000. Should the contracting officer include a requirement for contractor identification of sources of supply in the contract?

4. A contracting officer is contemplating the award of a contract to the Chicago Lighthouse for the Blind for $1.1 million. Will the contracting officer be required to document the contract file to indicate how information in FAPIIS was considered in any responsibility determination?

5. A contracting officer intends to award a contract for personal services that will require contractor personnel to perform outside the United States in a designated operational area during a peacekeeping operation. Is the contracting officer required to follow agency procedures and the weapons policy established by the combatant commander or the chief of mission when authorizing contractor personnel to carry weapons?


6. A contracting officer intends to award a personal services contract to an individual for health care. Is the contracting officer required to provide for full and open competition through use of the competitive procedure(s) contained in FAR subpart 6.1?

7. A contracting officer has a requirement for end products for public use inside the United States valued at $3,500. Assuming none of the exceptions at FAR 25.103 and DFARS 225.103 apply, is the contracting officer required to acquire domestic end products?

8. A contracting officer is issuing an undefinitized contract action (UCA) for initial spares. Is there a limit on the amount that can be obligated under the UCA before definitization?

9. A contracting officer (CO) intends to use simplified acquisition procedures to fulfill an urgent requirement for a noncommercial item. The CO intends to forego the requirement to synopsize under the authority of FAR 5.202(a)(2). Does the CO have to prepare the justification for other than full and open competition described in FAR 6.303? If yes, who must approve the justification?


Putting it All Together

The following checklist is provided to assist you in correctly using the regulations. It is divided into three separate sections—research, interpretation, and application.

When you research…Check the FAR to see if it contains the relevant rule. Check the DFARS for the rule if it is not contained in the FAR or, if the rule is contained in the FAR, check the DFARS for text that implements or supplements the FAR. Check class deviations for the rule if it is not contained in the FAR or DFARS or, if the rule is contained in the FAR and/or DFARS, check if there is a class deviation that affects the rule.

When you interpret…Check the section, subpart, and part where the rule is located for any specially defined words and terms used in the section, subpart, or part. If the rule contains any of the specially defined words or terms, read the definitions for those words or terms. If the rule uses any unclear words that are not specially defined in the section, subpart, or part, check FAR 2.101 for definitions of such words or terms.Ensure that your interpretation is in accordance with the FAR conventions (FAR 1.108).

Before applying a rule to a given acquisition…Read the paragraph that contains the rule. Look for express statements of applicability or exceptions to the rule. Remember to also check the DFARS and class deviations.Zoom out to the subsection level. Scan the subsection for express statements of applicability or exceptions to the rule. Remember to also check the DFARS and class deviations.Zoom out to the section level. Scan the section for express statements of applicability or exceptions to the rule. If the section contains subsections, scan the titles of the subsections for titles such as “Scope of section”, “Applicability”, “Exceptions”, “Exclusions”, “Limitations”, “Waiver”, etc. Remember to also check the DFARS and class deviations.Zoom out to the subpart level. Scan the titles of the sections for titles such as “Scope of subpart”, “Applicability”, “Exceptions”, “Exclusions”, “Limitations”, “Waiver”, etc. Remember to also check the DFARS and class deviations. Zoom out to the part level. Scan the titles of the sections preceding the first subpart for titles such as “Scope of part”, “Applicability”, “Exceptions”, “Exclusions”, “Limitations”, “Waiver”, etc. Remember to also check the DFARS and class deviations.Given any express statements of applicability or exceptions to the rule that you have found, determine if the rule applies given the relevant facts about the acquisition.

Many mistakes in using the regulations can be traced back to a failure to adequately address the items on this checklist.


Applying the Regulations

Using BLACKBOARD, answer each question below and provide a citation to support your answer. Work independently and at your own pace. Do not guess and wait for the instructor to reveal the correct answer. These questions are designed to help you prepare for tomorrow’s exam. Assume that all questions apply to a DoD acquisition. Do not cite anything in FAR subpart 52.2 or DFARS subpart 252.2 to support your answer.

1. Scenario: You are a contracting officer and you are in the process of making an award to an AbilityOne participating nonprofit agency.

Question: Yes or No (Chose one): Are you required to make an affirmative determination of responsibility before making the award?

a. Yes

b. No

Reference: __________________________________

2. Scenario: A contractor was awarded a purchase order for commercial items for $1.5 million under the authority of FAR subpart 13.5. The purchase order contained all applicable clauses that were current as of the date of the purchase order. Under the purchase order, the contractor is required to comply with a small business subcontracting plan that contains all of the required elements.

Question: Which of the following is TRUE?

a. The contractor must submit a Standard Form 294, Subcontracting Report for Individual Contracts.

b. The contractor must submit an individual subcontracting report through the Electronic Subcontracting Reporting System (eSRS).

c. The contractor may submit either an SF 294 or report its subcontracting through eSRS.

d. The contractor is not required to submit any subcontracting reports.

Reference: __________________________________


3. Which of the following multiyear contracts would require congressional notification before award?

a. Multiyear contract with a cancellation ceiling of $12 million

b. Multiyear contract with a cancellation ceiling of $13.5 million

c. Multiyear contract with a cancellation ceiling of $13 million

d. None of the above

Reference: __________________________________

4. Scenario: You are a contracting officer and you have a requirement for dredging of the Sabine-Neches Waterway that is estimated to cost anywhere between $1 million and $5 million. The work consists of using a pipeline dredge to remove approximately 1,518,000 cubic yards of maintenance material. No levee work will be required. Completion time for the project is 140 calendar days with a production rate of 12,000 cubic yards to be dredged per day and the contractor will have full control of the pace of the work. The contract will be set-aside and competed amongst Service-Disabled, Veteran-Owned Small Businesses. Solictiation and selection procedures from FAR part 14 will be utilized, resulting in a Firm-Fixed Price (FFP) contract.

Question: Which of the following is TRUE regarding the use of a liquidated damages clause listed under FAR 11.503?

a. The contracting officer must include a liquidated damages clause in the solicitation.

b. The contracting officer must include a liquidated damages clause in the solicitation, provided that she has determined that liquidated damages are appropriate.

c. The contracting officer may include a liquidated damages clause in the solicitation, provided that she has determined that liquidated damages are appropriate.

d. The contracting officer is prohibited from using a liquidated damages clause.

Reference: __________________________________


5. Scenario: A contracting officer is considering ordering supplies directly against a Federal Supply Schedule. The value of the order is expected to be $550,000.

Question: Which of the following is TRUE?

a. The contracting officer is required to enter into a written agreement on responsibility for management and administration of the order with GSA.

b. The contracting officer is required to make the determination at FAR 17.502-1(a)(1).

c. The contracting officer is required to make the determination at FAR 17.502-1(a)(2).

d. The contracting officer is not required to make the determination at FAR 17.502-1(a)(2).

Reference: __________________________________

6. Can an enemy prisoner of war be interrogated by contractor personnel?

a. No

b. It is generally prohibited, but the Secretary of Defense may waive the prohibition for a period of 60 days.

c. Only if the contractor personnel have proper training and security clearances.


Reference: __________________________________

7. Scenario: A Navy contracting officer stationed in Naples, Italy, has a received a request to lease motor vehicles from a requiring activity. The motor vehicles will be leased for a period of 60 days.

Question: What must the requiring activity certify, in writing, and provide to the contracting officer before the contracting officer can prepare the solicitation?


a. The vehicles requested are of maximum fuel efficiency and minimum body size, engine size, and equipment (if any) necessary to fulfill operational needs, and meet prescribed fuel economy standards.

b. Internal approvals have been received.

c. The General Services Administration has advised that it cannot furnish the vehicles.

d. None of the above applies.

Reference: __________________________________

8. Scenario: You are a contract specialist preparing a competitive solicitation for supplies that will also require the delivery of associated technical data under the contract.

Question: Yes or No (Chose one): Will you be required to include the clause at FAR 52.227-14 in this solicitation?

a. Yes

b. No

Reference: __________________________________

9. With regard to whistleblower protections for contractor employees, what is the deadline for a contractor to submit a written response to the inspector general’s report of findings? Assume that a time extension will not be granted.

a. Within 15 days

b. Within 30 days

c. Within 45 days


Reference: __________________________________

END OF MODULE 4


APPENDIX

Module 1 Applying the Regulations – Additional Practice Questions

Instructions: Questions 10 through 15 are optional and meant for additional research practice. Using BLACKBOARD, you may answer each question below and provide a citation to support your answer.

10. Yes - or - No (Choose one): Is use of the clause at FAR 52.219-17 required if the contracting officer proceeds with a competitive 8(a) acquisition and will make a direct award to the winner?

a. Yes

b. No

Reference: __________________________________

11. Yes - or - No (Choose one): Should the clause at FAR 52.246-21, Warranty of Construction, be used in a fixed-price construction contract that will be performed in Germany?

a. Yes

b. No

Reference: __________________________________

12. What is the micro-purchase threshold for the acquisition of construction subject to Wage Rate Requirements (Construction) during a Presidentially-declared national emergency in Louisiana?

a. $2,000

b. $3,500

c. $20,000

d. $30,000

Reference: __________________________________


13. Yes - or - No (Choose one): Can a DoD activity enter into a service contract for a military flight simulator without getting a waiver from the Secretary of Defense?

a. Yes

b. No

Reference: __________________________________

14. Yes - or - No (Choose one): Can a prime contractor accept a subcontractor's written representations of its size as a small disadvantaged business, if the subcontractor represents that the size and socioeconomic status representation with its offer are current, accurate, and complete as of the date of the offer for the subcontracts?

a. Yes

c. No

Reference: __________________________________

15. Scenario: A contracting officer on a military installation in Japan has a requirement for support services on the installation valued at $122,880. The acquisition cannot be fulfilled under the 8(a) Program, the HUBZone Program, the SDVOSB Program, or the WOSB Program.

Question: True - or - False (Choose one): This acquisition is automatically reserved exclusively for small business concerns and shall be set aside for small business unless the contracting officer determines there is not a reasonable expectation of obtaining offers from two or more responsible small business concerns that are competitive in terms of market prices, quality, and delivery.

a. True

b. False

Reference: __________________________________


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