Discussion of Comments

There were no public comments received in response to the Advanced Notice of Proposed Rulemaking.

B. Regulatory Flexibility Act

The GSA does not expect this proposed rule to have a significant economic impact on a substantial number of small entities within the meaning of the Regulatory Flexibility Act, 5 U.S.C. 601, et seq., because the revisions are not considered substantive. The revisions only update and reorganize existing coverage. An Initial Regulatory Flexibility Analysis has, therefore, not been performed. We invite comments from small businesses and other interested parties. The GSA will consider comments from small entities concerning the affected GSAR Part 514 in accordance with 5 U.S.C. 610. Interested parties must submit such comments separately and should cite 5 U.S.C. 601, et seq. (GSAR case 2008G505), in correspondence.

C. Paperwork Reduction Act

The Paperwork Reduction Act applies; however, these changes to the GSAR do not impose additional information collection requirements to the paperwork burden previously approved under OMB Control Number 3090 0027.
List of Subjects in 48 CFR Parts 514, 552, and 553

Government procurement.

Dated: September 17, 2008
Al Matera,

Director,Office of Acquisition Policy.

Therefore, GSA proposes to amend 48 CFR parts 514, 552, and 553 as set forth below:

1. The authority citation for 48 CFR parts 514, 552, and 553 continues to read as follows:

Authority: 40 U.S.C. 121(c).
PART 514SEALED BIDDING

2. Revise section 514.2012 to read as follows:
514.2012 Part IThe Schedule.
(a) When using Standard Form 33, Solicitation, Offer and Award, include the following cautionary notice:
``Notice to BiddersUse Item 13 of the Standard Form 33, Solicitation, Offer and Award, to offer prompt payment discounts. The Prompt Payment clause of this solicitation sets forth payment terms. Do not insert any statement in Item 13 that requires payment sooner than the time stipulated in the Prompt Payment clause (See FAR 52.23225). EXAMPLE: If you insert ``NET 20'' in Item 13, GSA will reject your offer as nonresponsive because the entry
contradicts the 30 day payment terms specified in the Prompt Payment clause.''
(b) When using other authorized forms (e.g., Standard Form 1447, Solicitation/Contract; Standard Form 1449, Solicitation/Contract/Order for Commercial Items), include the notice in paragraph (a) of this subsection. Change the reference to the form number, form title, and item number accordingly.

3. Revise section 514.2016 to read as follows:

514.2016 Solicitation provisions.

When considering all or none bids, insert the provision at 552.214 70, ``All or None'' Offers, in the solicitation.

4. Revise section 514.2017 to read as follows:

514.2017 Contract clauses.

Stock replenishment contracts. For some stock replenishment contracts, individual contractors may be unable to furnish the Government's monthly requirements. The contracting officer may determine that progressive awards will be more expedient. In such cases, insert a clause substantially the same as the clause at 552.214 71, Progressive Awards and Monthly Quantity Allocations, in the solicitation and contract.

5. Revise section 514.2024 to read as follows:
514.2024 Bid samples.
(a) Requirements for samples in invitations for bids. (1) When bid samples are required, the contracting officer shall require bidders to submit samples produced by the manufacturer whose products will be supplied under the contract.
(2) The FAR limits use of bid samples to cases where the contracting officer cannot describe some characteristics of a product adequately in the specification or purchase description. This usually applies to subjective characteristics. The contracting officer may determine that there is a need to
[[Page 60226]]
examine objective characteristics of bid samples to determine the responsiveness of a bid. The contracting officer should base the determination on past experience or other valid considerations. In the solicitation, separately list ``Subjective Characteristics'' and ``Objective Characteristics.''
(3) A provision appears at 552.21472, Bid Sample Requirements. This provision may be modified to fit the circumstances of a procurement.
(b) Handling bid samples. (1) Samples from accepted bids must be retained for the period of contract performance. If there are no outstanding claims regarding the contract, the contracting officer may authorize disposal of the samples at the end of the contract term following the bidder's instructions.
(2) If the contracting officer anticipates a claim regarding the contract, the contracting officer shall require that the bid samples be retained until the claim is resolved.
(3) The contracting officer shall require that samples from unsuccessful bids be retained until award. After award, these samples may be disposed of following the bidder's instructions.

6. Add section 514.2025 to read as follows:

514.2025 Descriptive Literature.

Requirements for Invitations for bids. When using brand name or equal purchase descriptions, the provision at FAR 52.2116 satisfies the requirement for descriptive literature.
514.203 [Removed]

7. Remove section 514.203.

8. Amend section 514.2702 by revising the section heading, redesignating paragraphs (a)(4) and (a)(5) as (a)(5) and (a)(6), respectively, adding new paragraph (a)(4), and revising paragraphs (b) introductory text, and (c) to read as follows::
514.2702 Justification for use.
* * * * *
(4) Awarding the lowdemand articles in conjunction with the high demand articles may encourage competition.
* * * * *
(b) Before deciding to combine items for aggregate award, the contracting officer should consider the following factors:
* * * * *
(c) The contracting officer should not use an aggregate award if it will significantly restrict the number of eligible bidders.

9. Revise section 514.2703 to read as follows:

514.2703 Evaluation factors for award.

The solicitation should clearly state the basis for evaluating bids for aggregate award, require bidders to submit a price on each item within the group or a percentage to be added or subtracted from a list price, and advise bidders that failure to submit prices as required within a group makes a bid ineligible for award for that group.

10. Amend section 514.2704 by revising paragraphs (a), (b), and (d)(3)(i) to read as follows:
514.2704 Grouping line items for aggregate award.
(a) Supplies and services. This subsection applies to acquisitions of supplies and services.
(b) Effect on competition. Provide for full and open competition when grouping items for award. Grouping items for award may preclude a significant number of firms from bidding. This occurs if firms are unable to provide all the types or quantities of supplies or services, or make deliveries to the various delivery points included in the prospective aggregate group.
* * * * *
(d) * * *
(3) * * *
(i) Grouping widespread geographic locations or delivery points may reduce competition or result in higher prices. It can cause the loss of ``area pricing'' advantages provided by a supplier with a single production point.
* * * * *

11. Amend section 514.2706 by

a. Revising the first sentence of paragraph (a) introductory text;

b. Revising the first sentence of paragraph (d); and

c. Removing from paragraph (e) the word ``you''.

The revised text reads as follows:
514.2706 Guidelines for using the weight factors method.
(a) Use the weight factors method when there are reliable estimates for the quantities needed in an acquisition. * * *
* * * * *
(d) Estimated quantities may be reduced to smaller numbers by a common denominator. * * *
* * * * *

12. Amend section 514.2707 by

a. Revising the first sentence in paragraph (a);

b. Revising the introductory text of paragraphs (b) and (c);

c. Revising paragraph (d);

d. Revising the second sentence of paragraph (e);

e. Revising the third sentence in paragraph (h), and paragraphs (i)(6) and (i)(8).

The revised text reads as follows:
514.2707 Guidelines for using the price list method.
(a) General. The price list method helps avoid unbalanced bidding when making aggregate awards, but lack accurate estimates of anticipated quantities. * * *
(b) Solicitation requirements. When using the price list method, in the solicitation:
* * * * *
(c) Developing list prices. Price lists may be developed using one or more of the following sources:
* * * * *
(d) First time use for an item or service. The first time the contracting officer uses list prices for an item or service, give prospective bidders an opportunity to review the proposed list. Also provide information on how GSA will use the list prices. This information may be provided in a draft solicitation.
(e) * * *. Prices may be used from previous awards made using the weight factors method to develop price lists.
* * * * *
(h) * * *. If the Government's needs cannot be estimated, the solicitation may include past orders. * * *
(i) * * *
(6) If providing quantity estimates, state that the estimates are for information only and do not constitute guarantees or commitments to order items under the contract.
* * * * *
(8) When the solicitation further groups unit prices by trade or business category, multiple percentages may be required.
* * * * *

13. Revise section 514.4073 to read as follows:

514.4073 Other mistakes disclosed before award.

Delegation of authority by head of the agency. Under FAR 14.407 3(e), contracting directors (see 502.101) are authorized, without power of redelegation, to make
(a) The determinations regarding corrections and withdrawals under FAR 14.4073(a), (b), and (c); and
(b) The corollary determinations not to permit withdrawal or correction under FAR 14.4073(d).

14. Revise section 514.4074 to read as follows:

514.4074 Mistakes after award.

The contracting director and assigned counsel are required to review and approve the contracting officer's determinations under FAR 14.4074(b) and (c).
[[Page 60227]]
PART 552SOLICITATION PROVISIONS AND CONTRACT CLAUSES

15. Amend section 552.21470 by

a. Revising the date of the provision;

b. Revising paragraph (a); and

c. Removing Alternate I.

The revised text reads as follows:
552.21470 ``All or None'' Offers.
* * * * *
``ALL OR NONE'' OFFERS (DATE)
(a) The Government reserves the right to evaluate offers and make awards on an ``all or none'' basis as provided below.
* * * * *
(End of provision)

16. Amend section 552.21472 by

a. Revising the date of the provision;

b. Revising the ``Note''; and

c. Adding text for the Contracting Officer's address.

The revised and added text reads as follows:
552.21472 Bid Sample Requirements.
* * * * *

BID SAMPLE REQUIREMENTS (DATE)
* * * * *

FOR FURTHER INFORMATION CONTACT For clarification of content, contact Mr. Michael O. Jackson at (202) 2084949, or by email at
michaelo.jackson@gsa.gov. For information pertaining to the status or publication schedules, contact the Regulatory Secretariat (VPR), Room 4041, GS Building, Washington, DC 20405, (202) 5014755. Please cite GSAR Case 2008G505.