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Government regulations regarding travel are not only required by employees of the U.S. government, but also extend to government contractors as well. Government contractors have to abide by many of the same regulations, though not all. This short treatise will touch on some of the similarities and differences of regulatory travel requirements for government employees versus government contractors in the areas of air travel, hotel accommodations and car rentals.
The implementation of the Fly America Act for government employees is predominately in the form of the Code of Federal Regulations (CFR) under the subsection Federal Travel Regulations (FTR) and the Joint Travel Regulations (JTR) as well as the Department of State Standardized Regulations (DSSR). The implementation of the Fly America Act for government contractors is predominately in the form of the CFR and the Federal Acquisition Regulations (FAR). The Defense Federal Acquisition Regulation (DFARS) does not seem to touch on the subject of U.S. flag air carriers, probably because this area has already been covered by the FAR. While many of the regulations regarding the use of U.S. flag carriers or code shares are the same for both government employees and contractors, there is a notable difference. For example, the GSA on its Contractor Fact Sheet has made it clear that City Pairs are not required of government contractors, because they cannot be used by them. One of the most complex questions is the applicability of the Fly America Act and its exceptions, including bilateral agreements (e.g. Open Skies agreements). Recently, the following question was posed to the GSA: Do the Open Skies agreements apply to the country of origin, destination or where the affiliated airline is headquartered? For example, the airline of Country A may provide travel between Country B and Country C, however the airline itself is headquartered in Country A. There are Open Skies agreements between the United States and Country A as well as with Country B, however the United States does not have an Open Skies Agreement with the destination country, Country C. The answer received was that the answer lay in the stipulations of the Open Skies Agreements themselves in Annex 3:
Open Skies Agreement (Australian/Switzerland/Japan)
(a) between any point in the United States and any point in (Australia, Switzerland, Japan) except – with respect to passengers only – between points for which there is a city-pair contract fare in effect, or
(b) between any two points outside the United States
Open Skies Agreement (European Union – 29 countries)
(a) between any point in the United States and any point outside the United States to the extent such transportation is authorized under subparagraph 1(c) of Article 3, except with respect to passengers who are eligible to travel on city-pair contract fares between points for which there is a city-pair contract fare in effect; or
(b) between any two points outside the United States
In essence, since the airline of Country A holds an Open Skies Agreement with the U.S., according to Annex 3, the airline of Country A may be used between any two points outside of the U.S., regardless of origin or destination. Further, for the government contractor, FAR 47.403-2 instructs agencies not to withhold contractor payment for use of airlines with which the U.S. holds an Open Skies Agreement.
Exploring the issue of code shares more in-depth, it is worthy to understand if the GSA recognizes all code share agreements between U.S. flag carriers or only some. For example, would the GSA recognize a code share agreement between Delta and Cubana airlines? It would seem that code share agreements between U.S. and foreign flag carriers must be approved by the Department of Transportation. In considering if a code share agreement is to be approved, DOT must consider law which essentially requires most of the conditions of an open skies agreement between the U.S. and the country of the foreign airline. It is unlikely that DOT would approve a code share agreement that is not in line with U.S. policy (for example between Delta and the embargoed Cuban airline Cubana). Therefore, it is likely that the GSA would recognize all code share agreements as part of reciprocity between the agencies of the USG.
While government employees are required to use one of the ETS systems for hotel selections, no such requirement extends to the government contractor since the ETS systems are not available to them. The government employee is required to use FEMA approved commercial lodging and encouraged to use businesses with which the government has contract rates. In the area of hotel selection, it is a grey area if the government contractor is required to adhere to FEMA approved commercial lodging within U.S. territory, since the FAR indicates that the “costs incurred for lodging…as defined in the…Federal Travel Regulations…Joint Travel Regulations…Standardized Regulations” are allowable. Does the term “lodging” imply that it has to be FEMA approved? It will is posited here that the FAR is truly referring to cost, as fire safety standards are probably irrelevant given both state and federal regulations within U.S. There does not seem to be the same FEMA registration and fire safety standards for accommodations in foreign countries. This is probably because hotels located in other sovereign nations are not subject to the regulatory requirements of a U.S. agency. The government contractor does not have access to use the contract rates negotiated by the U.S. government for its employees, because the contractor is, by definition, not an employee of the USG. The government contractor is required, however, to adhere to the same per diem regulations that government employees are.
In the area of rental cars, government employees are encouraged to rent cars through the Defense Travel Management Office (DTMO) U.S. Government Car Rental Agreement program , however since these contracts are specially negotiated with the U.S. Government, the Car Rental Agreement program cannot be utilized by government contractors. Rather, the FAR indicates only that, for government contractors to be reimbursed, the cost of car rentals only need to be reasonable and that they be used for company business. Regular employee transport to and from the job location, however, would not be allowed.
As we have seen, there are similarities and differences in regulatory travel requirements for government employees versus government contractors in the areas of air travel, hotel accommodations and car rentals. The Fly America Act equally applies to both government employees and contractors, with the exception of City Pairs, which are only available to government employees. In the area of hotel selections, while the per diem regulations equally apply to government employees and contractors, government employees are required to use FEMA approved hotels whereas this is a gray area in regards to the government contractor. The widest difference in travel regulation is in rental cars. While the government employee has access to, and is encouraged to use businesses with which the DTMO has established a Car Rental Agreement, the only requirement the government contractor has is the reason-ability of cost (along with documentation, of course). Regulation constantly changes, however, it is hoped that this short treatise will be helpful in understanding the current differences and similarities in regulatory travel requirements between government employees and contractors.
For the purposes of this paper, government contractors will mean those who are companies that are under the typical Task Order contract with the USG providing services where independent contractors require travel.
41 CFR §300-2.22 Who is subject to the FTR?. The FTR addresses employees and agencies. It could be argued that it applies to government contractors as well, but only in sections where the applicability specifically indicates that it is addressing a wider audience. 41 CFR § 301-10.132 “Who is required to use a U.S. flag air carrier?” is actually addressed (with some exceptions) to all travel using federal funds – both federal employees and government contractors.
Joint Travel Regulations Volume 2 C1000 (B)(4). There is a bit of grey area, depending on C1000 (A)(6) or C1000 (A)(8), however, this paper is mostly concerned with those who are under formal contract with a USG agency.
See note 1 re 41 CFR § 301-10.132
49 USC §40101(e), 40105 (1994)
41 CFR §301-11.11
FAR 31.205-46(a); 5 U.S.C. § 5707a
41 CFR §301-10.421(b)
See U.S. Government Car Rental Agreement #4 www.defensetravel.dod.mil/Docs/CarRentalAgreement.pdf Here, what is meant by “car rental” is the typical rental from a commercial company for a temporary period of not more than a week or two. There are provisions for contractor use of Interagency Fleet Management System vehicles in FAR 51.200, however these are (1) government owned vehicles and (2) are for usage for more than a week or two.