[Federal Register Volume 74, Number 233 (Monday, December 7, 2009)]
[Unknown Section]
[Pages 64189-64193]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: X09-61207]


[[Page 64189]]




DEPARTMENT OF DEFENSE (DOD)



Statement of Regulatory Priorities
Background
The Department of Defense (DoD) is the largest Federal Department 
consisting of three Military Departments (Army, Navy, and Air Force), 
ten Unified Combatant Commands, fourteen Defense Agencies, and ten DoD 
Field Activities. It has 1,417,747 military personnel and 731,592 
civilians assigned as of June 30, 2009, and over 200 large and medium 
installations in the continental United States, U. S. territories, and 
foreign countries. The overall size, composition, and dispersion of 
DoD, coupled with an innovative regulatory program, presents a 
challenge to the management of the Defense regulatory efforts under 
Executive Order 12866 ``Regulatory Planning and Review'' of September 
30, 1993.
Because of its diversified nature, DoD is affected by the regulations 
issued by regulatory agencies such as the Departments of Energy, Health 
and Human Services, Housing and Urban Development, Labor, 
Transportation, and the Environmental Protection Agency. In order to 
develop the best possible regulations that embody the principles and 
objectives embedded in Executive Order 12866, there must be 
coordination of proposed regulations among the regulatory agencies and 
the affected DoD Components. Coordinating the proposed regulations in 
advance throughout an organization as large as DoD is straightforward, 
yet a formidable undertaking.
DoD is not a regulatory agency, but occasionally it issues regulations 
that have an effect on the public. These regulations, while small in 
number compared to the regulating agencies, can be significant as 
defined in Executive Order 12866. In addition, some of DoD's 
regulations may affect the regulatory agencies. DoD, as an integral 
part of its program, not only receives coordinating actions from the 
regulating agencies, but coordinates with the agencies that are 
affected by its regulations as well.
Overall Priorities
The Department needs to function at a reasonable cost, while ensuring 
that it does not impose ineffective and unnecessarily burdensome 
regulations on the public. The rulemaking process should be responsive, 
efficient, cost-effective, and both fair and perceived as fair. This is 
being done in DoD while reacting to the contradictory pressures of 
providing more services with fewer resources. The Department of 
Defense, as a matter of overall priority for its regulatory program, 
fully incorporates the provisions of the President's priorities and 
objectives under Executive Order 12866.
Administration Priorities:
1. Rulemakings that Support the Administration's Regulation Agenda to 
            Streamline Regulations and Reporting Requirements
The Department plans to:
 Revise the Defense Federal Acquisition Regulation Supplement 
            (DFARS) to delete obsolete restrictions on contracting with 
            foreign entities for the performance of research and 
            development in connection with any weapon system or other 
            military equipment for DoD.
 Review of the DFARS requirements for reporting the loss, 
            theft, damage, or destruction of Government property.
 Review of the DFARS requirements for reporting Government 
            Furnished Equipment and Government Furnished Material in 
            the DoD Item Unique Identification (IUID) registry.
 Review of the DFARS requirements for Unique Item Identifier 
            marking of Government-furnished Equipment.
 Simplify and clarify the DFARS coverage of patents, data, and 
            copyrights, dramatically reducing the amount of regulatory 
            text and the number of required clauses.
 Simplify and clarify the DFARS coverage of multiyear 
            acquisitions.
 Finalize the DFARS rule that makes the required changes to 
            conform the DFARS to the Federal Acquisition Regulation 
            (FAR) implementation of the OFPP waivers of certain 
            statutory requirements when acquiring of COTS items.
 Improve the contract closeout process.
2. Regulations of Particular Interest to Small Business
Of interest to Small Businesses are regulations to:
 Revise the FAR and DFARS to implement the use of Electronic 
            Subcontracting Reporting System for both summary and 
            individual subcontracting reporting.
 Consider revisions to the FAR to address the findings of the 
            Rothe case that Federal contracting programs for minority-
            owned and other small businesses that implement 10 U.S.C. 
            2323 are ``facially unconstitutional.''
 Revise the FAR to implement changes in the HUBZone Program, in 
            accordance with Small Business Administration regulations.
 Revise the FAR to clarify the criteria for sole source awards 
            to service-disabled veteran-owned small businesses 
            concerns.
3. Regulations with International Effects or Interest
Of international effect or interest are regulations to:
 Finalize the FAR rule implementing the American Recovery and 
            Reinvestment Act of 2009 buy American requirements for 
            construction material.
 Finalize the DFARS rule that prohibits procurement of steel 
            for construction projects or activities for which American 
            steel producers, fabricators, and manufacturers have been 
            denied the opportunity to compete for such steel 
            procurement.
 Implement in the DFARS the determinations regarding 
            participation of South Caucasus/Central and South Asian 
            states in acquisitions in support of operations in 
            Afghanistan.
 Finalize the DFARS rule that provides authority to limit 
            competition in the acquisition of products or services, 
            other than small arms, acquired in support of operations in 
            Iraq or Afghanistan.
 Clarify in the DFARS the criteria for deciding whether a 
            company is located in Iraq or Afghanistan.
 Consider whether to revise the DFARS regulations relating to 
            acquisition of spare or replacement parts from the original 
            foreign manufacturer.
 Revise the DFARS to implement the pending Defense Procurement 
            Trade Cooperation Treaties with the United Kingdom and 
            Australia, upon ratification.
 Finalize the DFARS rule that implements the determination that 
            authorizes acquisition of articles containing para-aramid 
            fibers and yarns manufactured in a qualifying country, in 
            accordance with section 807 of the National Defense 
            Authorization Act for FY 1999.
 Revise the FAR and DFARS list of least designated countries 
            under the Trade Agreements Act to add Taiwan,

[[Page 64190]]

            Peru, Costa Rica, and Oman (FAR only).
 Revise the FAR list of articles that are domestically non-
            available.
 Finalize the FAR rule that prohibits Federal contractors from 
            restricted business operations in Sudan and imports from 
            Burma.
 Finalize the FAR rule that prohibits Government contracts with 
            any foreign incorporated entity that is treated as an 
            inverted domestic corporation under section 835(b) of the 
            Homeland Security Act of 2002 or any subsidiary of such 
            entity.
4. Suggestions From the Public for Reform--Status of DoD Items
Rulemaking Actions in Response to Public Nominations
The Army Corps of Engineers has not undertaken any rulemaking actions 
in response to the public nominations submitted to the Office of 
Management and Budget in 2001, 2002, or 2004. Those nominations were 
discussed in:
 Making Sense of Regulation: 2001 Report to Congress on the 
            Costs and Benefits of Regulations and Unfunded Mandates on 
            State, Local, and Tribal Entities.
 Stimulating Smarter Regulation: 2002 Report to Congress on the 
            Costs and Benefits of Regulations and Unfunded Mandates on 
            State, Local, and Tribal Entities.
 Progress in Regulatory Reform: 2004 Report to Congress on the 
            Costs and Benefits of Federal Regulations and Unfunded 
            Mandates on State, Local, and Tribal Entities.
Specific DoD Priorities:
For this Regulatory Plan, there are six specific DoD priorities, all of 
which reflect the established regulatory principles. In those areas 
where rulemaking or participation in the regulatory process is 
required, DoD has studied and developed policy and regulations that 
incorporate the provisions of the President's priorities and objectives 
under the Executive Order.
DoD has focused its regulatory resources on the most serious 
environmental, health, and safety risks. Perhaps most significant is 
that each of the priorities described below promulgates regulations to 
offset the resource impacts of Federal decisions on the public or to 
improve the quality of public life, such as those regulations 
concerning acquisition, security, homeowners, education, health 
affairs, and the National Security Personnel System.
1. Defense Procurement and Acquisition Policy
The Department of Defense continuously reviews the DFARS and continues 
to lead Government efforts to:
 Finalize the FAR rules that implement the regulations relating 
            to the American Recovery and Reinvestment Act of 2009 -- 
            Reporting Requirements, Publicizing Contract Actions, 
            Whistleblower Protection, and GAO/IG Access to Contractor 
            Employees.
 Revise the DFARS to implement the Weapons System Acquisition 
            Reform Act of 2009 -- including acquisition strategies to 
            ensure competition throughout life-cycle of major defense 
            acquisition programs and address organizational conflicts 
            of interest in major defense acquisition programs.
 Revise DFARS to ensure continuation of contractor services in 
            support of mission essential functions during an emergency, 
            such as an influenza pandemic.
 Revise the FAR to implement the Executive Orders relating to 
            project labor agreements, allowability of labor relations 
            costs, non-displacement of qualified workers, and 
            notification of employee rights under Federal labor laws.
 Revise the FAR to address service contractor employee personal 
            conflicts of interest and organizational conflicts of 
            interest and limit contractor access to information.
 Revise the FAR to establish a Federal database for Federal 
            agency contract and grant officers and suspension and 
            debarment officials, to track information relating to 
            awardees of Federal contracts and grants.
 Revise the FAR to require contractors to verify, through the 
            use of the E-Verify System, that certain of their employees 
            are eligible to work in the United States.
 Enhance competition by:
 -- Limiting the length of contracts awarded non-competitively under 
            ``unusual and compelling urgency'' circumstances to the 
            minimum contract period necessary to meet requirements, not 
            to exceed one year, unless approved by the head of the 
            contracting activity.
 -- Requiring publication of notices on FedBizOpps of all sole source 
            task or delivery orders in excess of the simplified 
            acquisition thresholds that are placed against multiple 
            award contracts or multiple award blanket purchase 
            agreements.
 -- Requiring post-award debriefings be provided, as requested, to 
            disappointed offerors on task and delivery orders in excess 
            of $5 million (including options).
 -- Requiring public disclosure of justification and approval documents 
            for noncompetitive contracts.
 Provide enhanced competition for task and delivery order 
            contracts and additional market research before awarding a 
            task or delivery order in excess of the simplified 
            acquisition threshold.
2. Logistics and Materiel Readiness, Department of Defense
The Department of Defense published or plans to publish rules on 
contractors supporting the military in contingency operations:
 Interim Final Rule: Private Security Contractors (PSCs) 
            Operating in Contingency Operations. In order to meet the 
            mandate of Section 862 of the 2008 National Defense 
            Authorization Act, this rule establishes policy, assigns 
            responsibilities and provides procedures for the regulation 
            of the selection, accountability, training, equipping, and 
            conduct of personnel performing private security functions 
            under a covered contract during contingency operations. It 
            also assigns responsibilities and establishes procedures 
            for incident reporting, use of and accountability for 
            equipment, rules for the use of force, and a process for 
            administrative action or the removal, as appropriate, of 
            PSCs and PSC personnel. DoD published an interim final rule 
            on July 17, 2009 (74 FR 34690-34694) with an effective date 
            of July 17, 2009. The comment period ended August 31, 2009.
 Proposed Rule: Program Management of Operational Contract 
            Support for Contingency Operations. This rule will 
            incorporate the latest changes and lessons learned into 
            policy and procedures for program management for the 
            preparation and execution of contracted support and the 
            integration of DoD contractor personnel into military 
            contingency operations outside the United States. DoD 
            anticipates publishing the proposed rule in the first or 
            second quarter of FY 2010.
3. Installations and Environment, Department of Defense

[[Page 64191]]

The Department of Defense has published a rule to assist eligible 
military and civilian Federal employee homeowners:
 Interim Final Rule: This rule continues to authorize the 
            Homeowners Assistance Program (HAP) under section 3374 of 
            title 42, United States Code, to assist eligible military 
            and civilian Federal employee homeowners when the real 
            estate market is adversely affected by closure or 
            reduction-in-scope of operations. In accordance with DoD 
            Directive 5101.1, DoD Executive Agent,`` designates the 
            Secretary of the Army as the DoD Executive Agent for 
            administering, managing, and executing the HAP. 
            Additionally, this rule will allow the Department of 
            Defense to temporarily expand the existing HAP in 
            compliance with section 1001 of the American Recovery and 
            Reinvestment Act of 2009. This temporary expansion covers 
            certain persons affected by BRAC 2005, certain persons on 
            permanent change of station orders, and certain wounded 
            persons and surviving spouses. This rule updates policy, 
            delegates authority, and assigns responsibilities for 
            managing Expanded HAP. This is an economically significant 
            rule. The interim final rule was published September 30, 
            2009 (74 FR 50109), with an effective date of September 30, 
            2009. The comment period ended October 30, 2009. DoD 
            anticipates publishing a final rule in the third quarter of 
            FY 2010.
4. Personnel and Readiness, Department of Defense
The Department of Defense published or plans to publish a rule 
implementing the Post-9/11 Veterans Educational Assistance Act of 2008, 
title V, P.L. 110-252 (the ``Post-9/11 GI Bill''):
 Interim Final Rule: This rule establishes policy, assigns 
            responsibilities, and prescribes procedures for carrying 
            out the Post-9/11 GI Bill. It establishes policy for the 
            use of supplemental educational assistance ``kickers,'' for 
            members with critical skills or specialties, or for members 
            serving additional service; for authorizing the 
            transferability of education benefits; and for the DoD 
            Education Benefits Fund Board of Actuaries. DoD published 
            an interim final rule on June 25, 2009 (74 FR 30212-30220) 
            with an effective date of June 25, 2009. The comment period 
            ended July 27, 2009.
5. Health Affairs, Department of Defense
The Department of Defense is able to meet its dual mission of wartime 
readiness and peacetime health care by operating an extensive network 
of medical treatment facilities. This network includes DoD's own 
military treatment facilities supplemented by civilian health care 
providers, facilities, and services under contract to DoD through the 
TRICARE program. TRICARE is a major health care program designed to 
improve the management and integration of DoD's health care delivery 
system. The program's goal is to increase access to health care 
services, improve health care quality, and control health care costs.
The TRICARE Management Activity has published or plans to publish the 
following rules:
 Final rule on CHAMPUS/TRICARE: Inclusion of TRICARE Retail 
            Pharmacy Program in Federal Procurement of Pharmaceuticals. 
            This rule implements changes directed by the enactment of 
            National Defense Authorization Act for Fiscal Year 2008 
            (NDAA-08), Pub. L. 110-181, to the extent necessary to 
            ensure pharmaceuticals, paid for by the DoD that are 
            provided by pharmacies under the TRICARE Retail Pharmacy 
            Program (TRRx) to eligible beneficiaries, are subject to 
            the pricing standards under section 8126 of title 38 United 
            States Code. This is an economically significant rule. The 
            proposed rule was published July 25, 2008 (73 FR 43394). 
            The comment period ended September 23, 2008. The final rule 
            published March 17, 2009 (74 FR 11279-11293) with an 
            effective date of May 26, 2009.
 Final rule on TRICARE: Outpatient Prospective Payment System 
            (OPPS). The rule implements a prospective payment system 
            for hospital outpatient services similar to that furnished 
            to Medicare beneficiaries, as set forth in section 1833(t) 
            of the Social Security Act. The rule also recognizes 
            applicable statutory requirements and changes arising from 
            Medicare's continuing experience with its system, including 
            certain related provisions of the Medicare Prescription 
            Drug, Improvement, and Modernization Act of 2003. While 
            TRICARE intends to remain as true as possible to Medicare's 
            basic OPPS methodology (i.e., adoption and updating of the 
            Medicare data elements used in calculating the prospective 
            payment amounts), there will be some significant deviations 
            required to accommodate the uniqueness of the TRICARE 
            program. These deviations have been designed to accommodate 
            existing TRICARE benefit structure and claims processing 
            procedures implemented under the TRICARE Next Generation 
            Contracts (T-NEX) while at the same time eliminating any 
            undue financial burden to TRICARE Prime, Extra and Standard 
            beneficiary populations. The proposed rule was published 
            April 1, 2008 (73 FR 17271). The comment period ended June 
            2, 2008. The final rule published December 10, 2008 (73 FR 
            74945-74966) with an effective date of February 9, 2009. 
            DoD published a notice on February 6, 2009 (74 FR 6228) 
            delaying the effective date of the final rule to May 1, 
            2009 and re-opening the final rule for comment. The comment 
            period ended March 9, 2009. DoD then published a notice May 
            8, 2009 (74 FR 21547) responding to the comments received. 
            The effective date of the final rule remained May 1, 2009.
 Final rule on TRICARE: Relationship Between the TRICARE 
            Program and Employer-Sponsored Group Health Coverage. This 
            rule implements section 1097c of title 10, United States 
            Code. This law prohibits employers from offering incentives 
            to TRICARE-eligible employees to not enroll, or to 
            terminate enrollment, in an employer-offered Group Health 
            Plan (GHP) that is or would be primary to TRICARE. 
            Cafeteria plans that comport with section 125 of the 
            Internal Revenue Code will be permissible so long as the 
            plan treats all employees the same and does not illegally 
            take TRICARE eligibility into account. The proposed rule 
            was published March 28, 2008 (73 FR 16612). The comment 
            period ended May 27, 2008. DoD anticipates publishing a 
            final rule in the first quarter of FY 2010.
 Final rule on TRICARE: Authorization of Forensic Examinations. 
            This rule implements section 701 of the John Warner 
            National Defense Authorization Act for FY 2007, Public Law 
            109-364. Section 701 amends Title 10 of the United States 
            Code (U.S.C.), Chapter 55, Section 1079(a) by authorizing 
            coverage for forensic examinations following a sexual 
            assault or domestic violence for eligible beneficiaries. 
            This authorizes forensic examinations provided in civilian 
            health care facilities (e.g., civilian rape crisis 
            facilities) following sexual assault or domestic

[[Page 64192]]

            violence, which is consistent with the services that are 
            authorized in Military Medical Treatment Facilities for all 
            beneficiaries who are victims of sexual assault or domestic 
            violence. The proposed rule was published July 7, 2008 (73 
            FR 38348-38350). The comment period ended September 5, 
            2008. The final rule published July 17, 2009 (74 FR 34649-
            34696) with an effective date of August 17, 2009.
6. National Security Personnel System, Department of Defense
On November 1, 2005 (70 FR 66115-66164), the Department of Defense and 
the Office of Personnel Management (OPM) issued final regulations to 
establish the National Security Personnel System (NSPS), a human 
resources management system, within DoD, as authorized by the National 
Defense Authorization Act (Pub. L. 108-136, November 24, 2003). These 
regulations govern basic pay, staffing, classification, performance 
management, labor relations, adverse actions, and employee appeals. 
These regulations are designed to ensure that the DoD's human resources 
management and labor relations systems align with its critical mission 
requirements and protect the civil service rights of its employees.
Subsequent legislation in the National Defense Authorization Act (Pub. 
L. 110-181, January 28, 2008) required revision of the NSPS regulation. 
DoD and OPM published a proposed rule on May 22, 2008 (73 FR 29882-
29927). The period for public comment ended on June 23, 2008. The final 
rule published September 26, 2008 (73 FR 56344-56420) with an effective 
date of October 7, 2008. A correction to the final rule effective date 
published on October 7, 2008 (73 FR 58435). The effective date was 
corrected to November 25, 2009.
DoD and OPM published a proposed rule on December 3, 2008 (73 FR 73606-
73716) to add a Staffing and Employment subpart to the final rule that 
was published on September 26, 2008. The period for public comment 
ended on January 2, 2009. The final rule published January 16, 2009 (74 
FR 2757-2770) with an effective date of March 17, 2009.
On July 16, 2009, a task group under the Defense Business Board (DBB) 
made recommendations to significantly alter the National Security 
Personnel System (NSPS). The final report of the DBB will be to the 
Department of Defense and the Office of Personnel Management (OPM). The 
recommendations may be adopted or rejected. If adopted, some of the 
recommendations may be implemented under the current regulation. 
However, it is likely that the regulation will require substantial 
revision
DoD and OPM anticipate publishing a proposed rule in late winter 2010 
and a final rule in the fall of 2010, to be effective 60 days after 
final action.
_______________________________________________________________________



DOD--Office of the Secretary (OS)

                              -----------

                            FINAL RULE STAGE

                              -----------




36.  HOMEOWNERS ASSISTANCE PROGRAM (HAP)

Priority:


Economically Significant. Major under 5 USC 801.


Legal Authority:


42 USC 3374


CFR Citation:


32 CFR 239


Legal Deadline:


None


Abstract:


This rule continues to authorize the Homeowners Assistance Program 
(HAP) under section 3374 of title 42, United States Code, to assist 
eligible military and civilian Federal employee homeowners when the 
real estate market is adversely affected by closure or reduction-in-
scope of operations. In accordance with DoD Directive 5101.1, DoD 
Executive Agent,`` designates the Secretary of the Army as the DoD 
Executive Agent for administering, managing, and executing the HAP.


Additionally, this rule will allow the Department of Defense to 
temporarily expand the existing Homeowners Assistance Program (HAP) in 
compliance with The American Recovery and Reinvestment Act of 2009 
(ARRA). This temporary expansion covers certain persons affected by 
BRAC 2005, certain persons on permanent change of station (PCS) orders, 
and certain wounded persons and surviving spouses. This rule updates 
policy, delegates authority, and assigns responsibilities for managing 
Expanded HAP.


Statement of Need:


This rule continues to authorize the Homeowners Assistance Program 
(HAP) under section 3374 of title 42, United States Code, to assist 
eligible military and civilian Federal employee homeowners when the 
real estate market is adversely affected by closure or reduction-in-
scope of operations. It updates policy, delegates authority, and 
assigns responsibilities for managing HAP. In accordance with DoD 
Directive 5101.1, ``DoD Executive Agent,'' designates the Secretary of 
the Army as the DoD Executive Agent for administering, managing, and 
executing the HAP.


Additionally, this rule will allow the Department of Defense to 
temporarily expand the existing HAP in compliance with section 1001 of 
the American Recovery and Reinvestment Act of 2009 (ARRA). This rule 
updates policy, delegates authority, and assigns responsibilities for 
managing Expanded HAP.


Summary of Legal Basis:


42 U.S.C. 3374


Alternatives:


Required by 42 U.S.C. 3374. No alternatives considered.


Anticipated Cost and Benefits:


There is no cost to the public. Administrative costs to the Department 
of Defense for implementation of the authorities under this rule are 
eight percent of the $555 million appropriated to fund the Expanded 
HAP. Workload will be accomplished with additional staffing and will be 
integrated into normal business.


Risks:


The rule will allow the Department of Defense to expand HAP to assist 
military families and DoD civilians who recently sold their homes at a 
loss. This temporary expansion covers certain persons affected by BRAC 
2005, certain persons on permanent change of station orders, and 
certain wounded persons and surviving spouses.


Timetable:
_______________________________________________________________________
Action                            Date                        FR Cite

_______________________________________________________________________
Interim Final Rule              09/30/09                    74 FR 50109
Interim Final Rule 
    Effective                   09/30/09
Interim Final Rule 
    Comment Period End          10/30/09
Interim Final Rule 
    Comment Period 
    Extended                    11/16/09                    74 FR 58846
Interim Final Rule 
    Comment Period End          01/15/10
Final Action                    04/00/10

Regulatory Flexibility Analysis Required:


No

[[Page 64193]]

Small Entities Affected:


No


Government Levels Affected:


Federal


Agency Contact:
Deanna Buchner
Department of Defense
Office of the Secretary
3000 Defense Pentagon
Washington, DC 20301-3000
Phone: 703 602-4353
RIN: 0790-AI58
BILLING CODE 5001-06-S