DATE: March 13, 2000

FROM: Barry McVay, CPCM

SUBJECT: Department of Energy (DOE); Rewrite of DEAR Part 970, DOE Management and Operating (M&O) Contracts

SOURCE: Federal Register, March 13, 2000, Vol. 65, No. 49, page 13417

AGENCIES: Department of Energy (DOE)

ACTION: Notice of Proposed Rulemaking

SYNOPSIS: DOE is proposing to rewrite DOE Acquisition Regulation (DEAR) Part 970 to streamline the policies, procedures, provisions and clauses that are applicable to its M&O contracts. This proposed rule would eliminate coverage that is obsolete or which duplicates the Federal Acquisition Regulation (FAR), and would retain only the coverage that implements or supplements the FAR. Also, four new clauses would be added, several existing clauses would be amended, and cross-references in other DEAR sections would be revised to reflect the changes.

EDITOR'S NOTE: The DEAR is Chapter 9 of Title 48 of the Code of Federal Regulations. It is available on the Internet at http://www.pr.doe.gov/dear.html. DEAR Part 970 constitutes approximately one-half of the DEAR.

DATES: Comments must be submitted no later than May 12, 2000.

ADDRESSES: Three copies of any comments should be addressed to John R. Bashista, Office of Procurement and Assistance Management, Office of Procurement and Assistance Policy (MA-51), Department of Energy, 1000 Independence Avenue SW, Washington, DC 20585.

SUPPLEMENTAL INFORMATION: DOE's Office of Procurement and Assistance Management recently completed a review of M&O policies and procedures in DEAR Part 970, many of which have been in place for decades to provide contract terms and conditions applicable to the unique M&O contracting environment and to implement FAR Subpart 17.6, Management and Operating Contracts. The purpose of the review was to determine whether the unique regulatory coverage for M&O contracts is still necessary, and if so, what improvements are required to maintain the credibility of the system.

The conclusion was that DEAR Part 970 should be retained because most of it implements statutory, regulatory, or current DOE policy that is not addressed in other federal regulations. However, the review also concluded that some policy and procedural requirements should be eliminated, and that several contract clauses are unnecessary or redundant of coverage already prescribed in the FAR. The notable recommendations include:

It is expected that the implementation of these recommendations will be accomplished through amendment of the DEAR and issuance of internal DOE guidance.

This proposed rule would rewrite DEAR Part 970 in its entirety, to streamline the policies, procedures, provisions and clauses that are applicable to the Department's M&O contracts. DEAR Part 970 would be reorganized and renumbered so that the coverage corresponds, to the extent practicable, with the FAR Part, subpart, section, and subsection(s) being implemented or supplemented. For example, the coverage in new DEAR Subpart 970.01, Management and Operating Contract Regulatory System, would correspond to that in FAR Part 1, Federal Acquisition Regulations System, and DEAR 970.0103, Publication and Codification, would correspond to FAR 1.303, Publication and Codification.

The following are the subparts of the proposed DEAR Part 970:

970.01 -- Management and Operating Contract Regulatory System
970.03 -- Improper Business Practices and Personal Conflicts of Interest
970.04 -- Administrative Matters
970.08 -- Required Sources of Supplies and Services
970.09 -- Contractor Qualifications
970.11 -- Describing Agency Needs
970.15 -- Contracting by Negotiation
970.17 -- Special Contracting Methods
970.19 -- Small, Small Disadvantaged and Women-Owned Small Business Concerns
970.22 -- Application of Labor Policies
970.23 -- Environmental, Conservation, and Occupational Safety Programs
970.26 -- Other Socioeconomic Programs
970.27 -- Patents, Data, and Copyrights
970.28 -- Bonds and Insurance
970.29 -- Taxes
970.30 -- Cost Accounting Standards
970.31 -- Contract Cost Principles and Procedures
970.32 -- Contract Financing
970.34 -- Major System Acquisition
970.35 -- Research and Development Contracting
970.36 -- Construction and Architect-Engineer Contracts
970.37 -- Facilities Management Contracting
970.41 -- Acquisition of Utility Services
970.43 -- Contract Modifications
970.44 -- Management and Operating Contractor Purchasing
970.45 -- Government Property
970.49 -- Termination of Contracts
970.50 -- Extraordinary Contractual Actions
970.52 -- Solicitation Provisions and Contract Clauses for Management and Operating Contracts

Four new clauses are also proposed for inclusion in the DEAR to prescribe DOE policies:

In addition, the following clauses would be removed from the DEAR as unnecessary or duplicative:

Several other clauses would be combined with others to form single clauses.

A separate rulemaking will be issued to implement recommendations concerning the amendment or removal of certain DEAR Part 970 cost principles and related provisions and clauses.

FOR FURTHER INFORMATION CONTACT: Barry McVay at 703-451-5953 or by e-mail to BarryMcVay@FedGovContracts.com.

Copyright 2000 by Panoptic Enterprises. All Rights Reserved.

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