Office of Governmentwide Policy
MEMORANDUM FOR HEADS OF CONTRACTING ACTIVITIES
FROM:
RAYMOND MCKENNA
DAVID A.
DEPUTY ASSOCIATE ADMINISTRATOR
FOR OFFICE OF ACQUISITION POLICY
GENERAL COUNSEL (
SUBJECT:
Construction as a Commercial
This policy memorandum discusses the applicability of Part 12, Acquisition of
Commercial Items, Federal Acquisition Regulation (FAR), to the acquisition of
construction services. Title
Federal Acquisition Streamlining Act of 1994
(FASA), provides for a preference for commercial items and established
acquisition policies for commercial items that are closer to commercial practices.
Since the implementation of FASA there has been some question as to whether
construction could be properly determined by a contracting officer to be a
commercial item. Despite the fact that there is no prohibition and FAR
02.1(d)
states in part
exercising initiative, Government members of the Acquisition
Team may assume if a specific strategy, practice, policy or procedure is in the
best interests of the Government and is not addressed in the FAR, nor prohibited
by law (statute or case law), Executive order or other regulation, that the
strategy, practice, policy or procedure is a permissible exercise of authority,”
many members of the acquisition community believe that construction cannot be
determined to be a commercial item in accordance with FAR
In GSA, construction may be determined to be a commercial item by contracting
officers in
Prior
accordance with FAR
to making this determination,
GSA contracting officers should conduct appropriate market research in
accordance with FAR Part 10.
There are some notable benefits to determining that a particular construction
project is a commercial item. Those benefits include: reduced time for synopsis
where it
and solicitation; use of advance
is
payments of up to
determined to
be a commercial practice; more commercial-like terms and conditions that will
attract new market entrants and in particular, small, disadvantaged, wo