DoD Seal DoD 50 Year Seal

OFFICE OF THE SECRETARY OF DEFENSE

1000 DEFENSE PENTAGON
WASHINGTON, DC 20301-1000
January 8, 1997

 
ACQUISITION AND
 TECHNOLOGY

DP(DAR)

                                                          In reply refer to
                                                          DFARS Case: 96-D017
                                                          D. L. 97-002



MEMORANDUM FOR	DIRECTORS OF DEFENSE AGENCIES
                    DEPUTY FOR ACQUISITION AND BUSINESS MANAGEMENT,
                      ASN(RD&A)/ABM
                    DEPUTY ASSISTANT SECRETARY OF THE AIR FORCE
                      (CONTRACTING), SAF/AQC
                    DIRECTOR, PROCUREMENT POLICY, ASA(RD&A)/SARD-PP
                    DEPUTY DIRECTOR (ACQUISITION), DEFENSE LOGISTICS
                      AGENCY



SUBJECT:     Information Technology Management Reform Act


    We have amended the Defense Federal Acquisition Regulation
Supplement (DFARS) to conform with the Federal Acquisition
Regulation implementation of Division E of the Clinger-Cohen Act
of 1996 (Pub. L. 104-106).

    The attached final DFARS rule is effective immediately and will
be included in a future Defense Acquisition Circular.







                                                    /s/

                                             Eleanor R. Spector
                                             Director, Defense Procurement

Attachment

DFARS Case 96-D017

SUBPART 239.70 - EXCHANGE OR SALE OF INFORMATION [TECHNOLOGY (IT)

239.7000 Scope of subpart.
This subpart contains unique DoD procedures for the exchange or sale of [information technology] using the exchange authority of the General Services Administration (GSA). [This subpart only applies to items with an original acquisition cost of $1,000,000 or more.]

239.7001 Policy.
Agencies should consider exchange/sale when replacing Government-owned [information technology]. Exchange/sale is a method of -

(a) Transferring the equipment to be replaced to -

(1) Another Government agency, with reimbursement (sale); or

(2) The supplier of the replacement [information technology] for a trade-in allowance (exchange).

(b) Applying the proceeds of sale or the exchange allowance toward the purchase of replacement [information technology].

239.7002 Conditions for using exchange/sale.

(a) The requiring activity must make a written determination that -

(1) The trade-in allowance of the exchange or the proceeds of the sale will be applied to acquire the replacement [information technology]; and

(2) The exchange/sale transaction will foster the economic and efficient accomplishment of a continuing requirement.

(b) The replacement equipment must be a [information technology] -

(1) Similar to the resource being sold or exchanged;

(2) Which will satisfy the continuing requirement currently met by the resource being replaced.

239.7003 Procedures.

(a) Comply with -

(1) * * * * *

(3)[The] Defense Automation Resources Management Manual.

(b) Solicit offers both on an exchange (trade-in for allowance) or no exchange (no trade-in) basis.

(c) Retain the option to exercise any exchange offer at the time of award.

(d) List and describe the [information technology to be exchanged] in the solicitation. At a minimum include -

(1) * * * * *

(e) Allow sufficient time in the contracting schedule to permit screening [within the Government] of the [information technology to be exchanged] prior to contract award.

(f) Immediately upon receipt of offers, determine the highest exchange offer (if any) and use it to initiate screening under [the Defense Automation Resources Management Manual].

(1) Send an SF 120, Report of Excess Personal Property, to the Defense Automation Resources [Management Program Division (ATTN: DARMP Division)]. Prominently display the following note on the original and five copies of the SF 120.

Exchange/"Sale" Property
A written administrative determination has been (will
be) made to apply the exchange allowance or proceeds of
"sale" to the acquisition of similar items.

(2) Include the following additional information with the SF 120 -

(i) * * * * *

(iv) The anticipated purchase price for the replacement equipment; [and]

([v]) The name and telephone number of the contracting officer.

(g) Evaluate offers using the solicitation criteria, including consideration of any exchange allowance offers. Award can be made whether or not the replaced [information technology] is exchanged.

(h) * * * * *

(j) If no exchange allowance was offered by the successful contractor, see [the Defense Automation Resources Management Manual] for disposal instructions.

SUBPART 239.71 - SECURITY AND PRIVACY FOR COMPUTER SYSTEMS

239.7100 Scope of subpart.

* * * * *

239.7102-3 Solicitation provisions and contract clauses.

When contracting for computer equipment or systems which are to be used to process classified information, use the clause at 252.239-7000, Protection Against Compromising Emanations.

SUBPART 239.72 -- STANDARDS

239.7200 Scope of subpart.
This subpart contains guidance for implementing -

(a) Federal Information Processing Standards (FIPS); and

(b) Federal Telecommunications Standards (FED-STD).

239.7201 [Reserved].

239.7202 Waivers.

(a) The Secretary of Commerce has delegated to the Secretary of Defense the authority to waive FIP standards, in accordance with procedures established by the Secretary of Commerce. The Secretary of Defense redelegated that waiver authority to the Assistant Secretary of Defense for Command, Control, Communications, and Intelligence (ASD(C3I)). The ASD(C3I) has redelegated to the senior [information technology] official of each military department the authority to approve waivers to FIP standards that are applicable to military department requirements. Waivers to FIP standards that are applicable to the requirements of DoD components outside the military departments must be approved by the ASD(C3I).

(b) Contracting officers shall ensure that all applicable FIP standards are incorporated into solicitations , except for those FIP standards for which the requiring activity has obtained a waiver from the appropriate military department or DoD senior [information technology] official.

(c) * * * * *.

SUBPART 239.73 - ACQUISITION OF AUTOMATIC DATA PROCESSING EQUIPMENT BY DOD CONTRACTORS

239.7300 Scope of subpart.

* * * * *

239.7302 Approvals and screening.

(a) The requirements of this section highlight the redistribution requirements of [the] Defense Automation Resources Management Manual, and are in addition to those at FAR 45.302.

(b) If the contractor proposes acquiring ADPE subject to 239.7301(a) (1) and (2), [and the unit acquisition cost is $50,000 or more] -

(1) The contracting officer shall require the contractor to submit, through the administrative contracting officer, the documentation in 239.7305.

(2) The administrative contracting officer -

(i) Submits a request for screening the requirement against the pool of Government-owned ADPE to determine if available excess equipment could satisfy the contractor's needs. The request should include the contractor's supporting documentation. The request is sent to -

[Defense Information Systems Agency
Chief Information Officer
ATTN:
Defense Automation Resources Management Progra
Division (D03D)
701 S. Courthouse Road
Arlington, VA 22204-2199; or

(ii) Uses the Automation Resources Management System (ARMS) to screen on-line. System access may be requested from the Defense Information Systems Agency, Chief Information Officer, Defense Automation Resources Management Program (DARMP) Division. Customers may apply for an ARMS Account Number by calling the DARMP Help Desk at (703) 696-1904; DSN 426-1904, FAX (703) 696-1908; E-mail DARMP@NCR.DISA.MIL.

(iii) Documents the result of the System query.]

([iv]) Upon receipt of and based on screening results from [DARMP], advises the contractor that excess ADPE -

(A) Is available pursuant to [the Defense Automation Resources Management Manual]; or

* * * * *

239.7304 Purchase option credits.

(a) * * * * *

(c) Report purchase option credits as prescribed in [the Defense Automation Resources Manual].

* * * * *

239.74 - TELECOMMUNICATIONS SERVICES

239.7400 Scope.
This subpart prescribes policy and procedures for acquisition of telecommunications services and maintenance of telecommunications security. Telecommunications services may also meet the definition of [information technology].

239.7401 Definitions.

* * * * *

239.7402 Policy.

(a) * * * * *

(b) Security.

(1) * * * * *

(4) When the contractor or subcontractor does not meet ownership eligibility conditions, the head of the agency may authorize provision of the necessary facilities as Government- furnished property or acquisition as contractor-acquired property, as long as conditions of FAR 45.303 are met.

* * * * *

SUBPART 239.75—APPROPRIATIONS ACT RESTRICTIONS

239.7500 Scope of subpart.
This subpart contains restrictions on the acquisition of information [technology], imposed by Defense appropriations acts.

239.7501 Major automated information systems.

Restriction.
Section 8028 of the FY 1992 Defense Appropriations Act (Pub. L. 102-172) and similar sections of the FY 1993, FY 1994, and FY1995 Defense appropriations acts prohibit use of DoD appropriations for acquisition of major automated information systems, unless the systems have successfully completed oversight reviews required by DoD regulations.