FAR as Guidance for Grantees

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Q.  Does the FAR Online Representations and Certifications Application (ORCA) requirement apply to a Grantee's proposal submission process?

A. The FAR Online Representations and Certifications are not applicable to grantees. The only FAR requirements that grantees must adhere to are the cost principles in FAR Part 31 for determining allowable costs on grantee third party contracts. Grantees should continue to use the certs and assurances published annually by FTA and accessible through the TEAM system. (Revised: May 2010)

Q.  Bids can be rejected for good business reasons. What is your definition of good business reasons?

A.  The Federal Acquisition Regulation (FAR), Subpart 14.404-1, discusses the circumstances when all bids received may be rejected and the IFB cancelled. There are ten reasons discussed and we think this guidance should cover all of the conceivable circumstances when rejection of bids may be the proper thing to do. The FAR may be accessed online at: https://www.acquisition.gov/FAR/loadmainre.html. (Revised: May 2010)

Q. Are there any sections of FAR that address Design-Build Contracts specifically?

A.  FAR subpart 36.3—"Two Phase Design Build Selection Procedures" discusses the Federal approach to awarding Design Build contracts. (Revised: May 2010)

Q. The FTA Best Practices Procurement Manual refers to the Federal Acquisition Regulation (FAR), but often states that the FAR provides additional information which is not binding on grantees. What is the relationship between FTA Circular 4220 and the FAR? How should the FAR be used as guidance for FTA procurements?

A. FTA Circular 4220.1F contains requirements that grantees must comply with in their third party contracting activities.   The Best Practices Procurement Manual (BPPM)  is intended to give grantees a convenient insight into FTA requirements, such as those of Circular 4220.1F, the Code of Federal Regulations, etc., as well as transit industry "best practices" in different procurement contexts. It is never the intent of the BPPM, however, to impose new requirements on grantees. The BPPM often references the FAR for information only. Grantees are not required to comply with the FAR. When the FAR is cited in the BPPM, it is done so that grantees may see how the Federal government treats a given issue. Grantees may learn something that will be useful from the FAR, and if so, they may use the FAR technique or modify it to suit their own particular situation. Grantees may also review the FAR and find that it offers nothing helpful for their particular problem, in which case grantees are free to ignore the FAR approach. In other words, the FAR material included in the BPPM is just another data point for grantees to be aware of when they are structuring solutions to particular problems. But the FAR data points are no more important than other data points, such as the various industry "best practices" that are discussed in the BPPM. In addition to the FAR and industry "best practices," you will also find some references to the Model Procurement Code, or to various State codes. Here again the intent is to give the grantee information that may be useful in developing solutions to particular problems. (Revised: May 2010)

Q.  4220.1F requires compliance with the “Energy Policy and Conservation Act” authorizes the President to draw from the Strategic Petroleum Reserve (SPR). How is a contractor expected to “comply” with this law? In other words, how does it apply to contracts? And is it required by FAR? If so, under what provision/clause?

A.  The FTA Best Practices Procurement Manual, Appendix A.1, Clause No. 6 discusses the energy conservation contract clause requirements and suggests that grantees use a contract clause that says:

"Energy Conservation - The contractor agrees to comply with mandatory standards and policies relating to energy efficiency which are contained in the state energy conservation plan issued in compliance with the Energy Policy and Conservation Act."

The contract clause would require the contractor to comply with the particular energy conservation plan developed by the state in which the contractor performs the contract. It is the contractor's responsibility to ascertain what the state policies and standards are and then to comply with those policies.  FAR does not apply to FTA grantees, only to direct contracts (not grants) of the Federal government. (Posted: May 2010)

Q.  The Master Agreement & the 4220.1F Circular both indicate a requirement for contractors to "encourage" the use of seat belts IAW E.O. #13043. 23USC402(c) directs "each federal agency" to "promulgate rules"..."encouraging Federal contractors, subcontractors...to conduct such programs."  Yet there is no "federal" acquisition clause published in FAR to promulgate this rule or 'encourage' contractors to conduct such programs.  Is OFPP aware of the omission?  And more importantly, if this is truly a "federally required" clause, why isn't DOT's 1252.223-73 included in Appendix A.1 and/or Appendix D of the 4220 circular?  Also, where is the "Buckle Up America" 'section' on NHTSA's website?  And I called the NETS 1-888 # about the "award for achieving the President's goal of 90 percent seat belt use", and was advised that this program is no longer in use or, at least to the contact's knowledge, the funding for the "award" is not coming from NETS.  So, at a minimum, it appears this clause, if indeed "federally required", needs to be updated.

Speaking of DOT, it seems like my two previous procurement questions submitted on this site (re: Energy Conservation and the Clean Air & Water Acts) would apply here as well.  If there are no DOT clauses or FAR clauses that address these issues, on what basis can FTA determine them to be "federally required"? I would strongly recommend FTA tie their "federally required" clauses/provisions directly to the related FAR/DOT acquisition regulations.  Allowing agencies to "paraphrase" or create their own version of a clause/provision is extremely dangerous and could lead to contractors taking exception to the clauses/provisions.  Conversely, FAR/DOT clauses/provisions have already been vetted thru the clearance/public comment review process.  Therefore the odds of any exceptions being taken are virtually non-existent.  Just a suggestion.

A. This Procurement Helpline relates to FTA grantees and their procurement issues. FTA grantees are not "federal contractors," and third party contractors of grantees are also not "federal contractors."   Thus FTA is not required to promulgate rules for them per 23 USC 402(c).

FTA grantees are not subject to FAR (but see below) nor does FTA have any jurisdiction over the FAR. FAR relates to direct contract awards by federal agencies and establishes requirements for contracts with federal contractors, not federal grantees.  Requirements for federal grantees come from the common grant rules at 49 CFR Parts18 or 19.

The one exception to the non-applicability of FAR to grantees is FAR part 31 - Cost Principles:

  1. The Common Grant Rules themselves refer to FAR cost principles being applicable to for-profit organizations, and
  2. 49 U.S.C. 5325(b) directs FTA to apply FAR cost principles in determining a firm's indirect cost rates.

The Clean Air and Clean Water requirements for FTA grantees do not come from FAR requirements, but from the common grant rules in 49 CFR Part 18.36 (i) (12).  FTA is required to base its Circular 4220.1F requirements for grantees on the common grant rules, not FAR.  Thus the contract clause instructions in the BPPM Appendix A.1 never reference the FAR requirements but are based upon specific regulations applying to grantees, such as the common grant rules.

As far as NHTSA's web site, you will have to contact them directly.  FTA and NHTSA are different agencies. (Posted: May 2010)

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