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FAIR Act Inventory User's
Guide
Overview
August 15, 2000
Introduction Background Inventory Scope
Inventory Format The FAIR Act
Challenge and Appeals Process The Annual Management
Report
INTRODUCTION
The Office of Management and Budget has developed this WEB page and
FAIR Act User's Guide to assist the public in its review and understanding of
the inventories of commercial activities that agencies have developed under the
Federal Activities Inventory Reform Act (FAIR) Act.
To see the actual inventory of any specific agency, you should go to
the Internet WEB page for that agency. OMB has required all agencies to post
their inventories on their Internet Web sites, so that persons interested in
filing challenges, and other interested members of the public, can have quick
and easy access to them. For those who do not have Internet access, an agency's
inventory may also be obtained by contacting that agency's FAIR Act
Point-of-Contact (who is identified in the Federal Register
Notification which OMB issues, announcing that the agency's inventory is
available for public review).
If your do not have a printer, but need a paper copy of the FAIR
Act, this User Guide, OMB Circular A-76 or its Supplemental Handbook, contact
the Office of Federal Procurement Policy, NEOB Room 9013, Office of Management
and Budget, 725 17th Street, N.W. Washington, DC 20503; telephone
No. (202) 395-7579, or e-mail your request to mchristi@omb.eop.gov.
BACKGROUND
The FAIR Act directs Federal agencies to issue each year an
inventory of all commercial activities performed by Federal employees, e.g.,
those activities that are not inherently governmental. OMB is to review each
agency's Commercial Activities Inventory and consult with the agency regarding
its content. Upon the completion of this review and consultation, the agency
must transmit a copy of the inventory to Congress and make it available to the
public. The FAIR Act establishes a limited administrative appeals process under
which an interested party may challenge the omission or the inclusion of a
particular activity on the inventory as a commercial activity. With completion
of the inventory, including the challenge and appeals process, the FAIR Act
requires agencies to review the activities on the inventory.
OMB issued FAIR Act implementation guidance through revisions to OMB
Circular A-76, "Performance of Commercial Activities," and to its Supplemental
Handbook. OMB Circular A-76 Transmittal Memorandums 20 and 22 provide further
guidance, as does the OMB Deputy Director's Memorandum to Heads of Agencies,
dated April , 27, 2000. These revisions inform agencies of the FAIR Act's
requirements; implement the statutory requirements of the FAIR Act; and place
the FAIR Act's requirements in the context of the Federal Government's larger
review of its reinvention, competition and privatization efforts. Copies of
these issuances are found on OMB's Internet Web site [you can link to each
issuance from the cover sheet for this guide], and paper copies can be
obtained from the Office of Federal Procurement Policy.
INVENTORY SCOPE
The FAIR Act applies by its own terms to the following executive
agencies: (1) an executive department named in 5 USC 101, (2) a military
department named in 5 USC 102, and (3) an independent establishment as defined
in 5 USC 104. The FAIR Act does not apply to: (1) the General Accounting
Office, (2) a Government corporation or a Government controlled corporation as
defined in 5 USC 103, (3) a non-appropriated funds instrumentality if all of
its employees are referred to in 5 USC 2105(c), or (4) Depot-level maintenance
and repair of the Department of Defense as defined in 10 USC 2460.
For purposes of the FAIR Act, there are two kinds of activities that
are performed by Federal employees: those activities that are "commercial" in
nature (and are, therefore, included on an agency's FAIR Act inventory) and
those that are "inherently governmental" (and are, therefore, omitted from the
inventory). The FAIR Act requires each agency to prepare an inventory of its
activities that "are not inherently governmental functions" (i.e., are
"commercial"), and the FAIR Act defines an "inherently governmental function"
as one "that is so intimately related to the public interest as to require
performance by Federal Government employees." In 1992, the Office of Federal
Procurement Policy (OFPP) issued Policy Letter 92-1, dated September 23, 1992
(57 Federal Register 45096) (Appendix 5 of the A-76 Revised Supplemental
Handbook), which provides guidance on the identification of Inherently
Governmental activities. This guidance conforms to the definition provided at
Section 5 (2) of the FAIR Act.
INVENTORY FORMAT
In accordance with the FAIR Act, Circular A-76 and its Revised
Supplemental Handbook, each agency is required to submit to OMB, by June 30 of
each year, a Commercial Activities Inventory of all commercial activities
performed by Federal employees, in the order or format shown below. Note: this
is a change from the 1999 FAIR Act inventory which required the same
information, but permitted each agency to organize the information in a format
most useful to the agency. OMB believes that by imposing some consistency
through the reporting format, interested parties should become more familiar
with the report both within and across agencies. There is a definition of each
information element provided at the "Definitions" available from this WEB
page.
a. |
Organization unit. |
b. |
State(s). |
c. |
Location(s). |
d. |
FTE. |
e. |
Activity function code. |
f. |
Reason code. |
g. |
Year the activity first appeared on FAIR Act Commercial
Activities Inventory (initial value will be 1999). |
h. |
Name of a Federal employee responsible for the activity or
contact person from whom additional information about the activity may be
obtained. |
i. |
Year of cost comparison or conversion (if
applicable). |
j. |
CIV/FTE savings (if applicable). |
k. |
Estimated annualized Cost Comparison dollar savings (if
applicable). |
l. |
Date of completed Post-MEO Performance Review (if
applicable). |
If an agency identifies no commercial activities that are performed
by Federal employees, it is still required to submit an inventory to OMB --
stating that the agency has no commercial activities being performed by Federal
employees. Such an inventory is subject to OMB review and consultation, and
must be sent to Congress and published for challenge by interested parties.
THE FAIR ACT CHALLENGE AND APPEALS
PROCESS
Section 3 of the FAIR Act established a two-tiered administrative
challenge and possible appeals process that permits interested parties to
challenge the inclusion or the omission of an activity from the FAIR Act
inventory. Section 3(b) of the FAIR Act defines "interested party" as:
a. |
A private sector source that (A) is an actual or prospective
offeror for any contract or other form of agreement to perform the activity;
and (B) has a direct economic interest in performing the activity that would be
adversely affected by a determination not to procure the performance of the
activity from a private sector source. |
b. |
A representative of any business or professional association
that includes within its membership private sector sources referred to in a.
above. |
c. |
An officer or employee of an organization within an executive
agency that is an actual or prospective offeror to perform the
activity. |
d. |
The head of any labor organization referred to in section
7103(a) (4) of title 5, United States Code that includes within its membership
officers or employees of an organization referred to in c. above.
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If an interested party has any questions about the agency's
inventory or the agency's challenge-and-appeals process (e.g., to which agency
official should the party address its challenge), the party should contact the
agency FAIR Act Point-of-Contact, provided in the OMB Federal Register
Notification that an agency's inventory is publicly available.
An initial challenge to the inclusion or omission of an activity
must be filed with the designated agency Point-of-Contact within 30 working
days after publication of OMB's Federal Register notice stating that
the inventory is publically available. The challenge must set forth the
activity being challenged with as much specificity as possible, and the reasons
for the interested party's belief that the particular activity should be
reclassified as inherently Governmental (and therefore be deleted from the
inventory) or as commercial (and therefore be added to the inventory) in
accordance with OFPP Policy Letter 92-1 on inherently Governmental functions
(see Appendix 5) or as established by precedent (such as when other agencies
have contracted for the activity or undergone competitions for this or similar
activities).
To be considered valid for purposes of the FAIR Act, a challenge
must:
- be submitted by an interested party, as defined in the FAIR Act
and OMB Circular A-76 and its Supplemental Handbook;
- be received by the organization's point of contact within 30
working days of the date that of the OMB Federal Register
notice of availability and web site access. The agency's initial FAIR Act
Point-of-Contact and telephone number is provided with the OMB Federal
Register notification of the release of the inventory.
- set forth the activity being challenged for omission or
inclusion on the inventory as specifically as possible," i.e., provide
sufficient description of the activity in question, by organization, location,
and function and the number of FTE excluded from or included on the inventory
to enable the decision-maker to reasonably identify the activity being
challenged; and,
- provide "the reasons for the challenge."
Decisions and other communications, including rejections of
challenges that do not meet the criteria above, shall be in writing. The
decision-maker to the substance of a challenge must be at the same or higher
level in the organization as the individual who made the determination on the
original FAIR submission for the activity being challenged. Decisions should be
transmitted to interested parties "within 28 working days of receiving the
challenge." The notification must include a discussion of the rationale for the
decision and, if the decision is adverse, an explanation of the party's right
to file an appeal.
An interested party may then appeal an adverse decision to an
initial challenge within 10 working days after receiving the written
notification of the decision. The agency head may delegate the responsibility
to receive and decide appeals to the official identified in paragraph 9.a of
the Circular (or an equivalent senior policy official), without further
delegation. To be considered for purposes of the FAIR Act Administrative Appeal
process, filed in response to an agency response to a valid challenge, the
appeal must be submitted:
- in writing;
- by a challenger(s), whose valid challenge was denied or rejected
by the agency; and
- within 10 working days of the challenger's receipt of the
written decision on the challenge.
Authority to decide appeals may be delegated no lower than the
Assistant Secretary or equivalent level. Decisions shall be in writing, and
should be made and transmitted to the appellant within 10 working days of
receipt of the appeal. Decisions on appeals must:
- refer to the decision being appealed;
- state whether the appeal is upheld or denied; and
- state and discuss the reason[s] [rationale] for the
decision.
THE ANNUAL MANAGEMENT
REPORT
OMB's FAIR Act implementation guidance, at Appendix 2, paragraph I
of the A-76 Revised Supplemental Handbook (Transmittal No. 20), requires each
agency to submit an annual report on its management of commercial activities.
That report, which is to accompany, for the first time, the Year 2000 FAIR Act
Inventory, provides:
- A brief description of the Year 1999 Inventory Process.
- The "number of FAIR Act administrative challenges and appeals"
that the agency received in response to the 1999 Inventory.
- A brief description of the agency's Year 2000 Inventory process,
and
- A "description of the agency's review process" under Section
2(d) of the FAIR Act.
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