[Federal Register Volume 75, Number 43 (Friday, March 5, 2010)]
[Rules and Regulations]
[Pages 10191-10193]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2010-4730]


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DEPARTMENT OF DEFENSE

Defense Acquisition Regulations System

48 CFR Parts 237 and 252

RIN 0750-AG52


Defense Federal Acquisition Regulation Supplement (DFARS); DFARS 
Case 2009-D017, Continuation of Essential Contractor Services

AGENCY: Defense Acquisition Regulations System, Department of Defense 
(DoD).

ACTION: Interim rule with request for comments.

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SUMMARY: DoD is issuing an interim rule amending the Defense Federal 
Acquisition Regulation Supplement (DFARS) to add policy and a contract 
clause requiring that contractors providing essential contractor 
services, as determined by the requiring activity, shall be prepared to 
continue such services during periods of crisis.

DATES: Effective Date: March 5, 2010.
    Comment Date: Comments on this interim rule should be submitted in 
writing to the address shown below on or before May 4, 2010, to be 
considered in the formation of the final rule.

ADDRESSES: You may submit comments, identified by DFARS Case 2009-D017, 
using any of the following methods:
    Federal eRulemaking Portal: http://www.regulations.gov. Follow the 
instructions for submitting comments.
    E-mail: dfars@osd.mil. Include DFARS Case 2009-D017 in the subject 
line of the message.
    Fax: 703-602-0350.
    Mail: Defense Acquisition Regulations System, Attn: Mr. Julian E. 
Thrash, OUSD(AT&L)DPAP(DARS), Room 3B855, 3060 Defense Pentagon, 
Washington, DC 20301-3060.
    Hand Delivery/Courier: Defense Acquisition Regulations System, 
Crystal Square 4, Suite 200A, 241 18th Street, Arlington, VA 22202-
3402.
    Comments received generally will be posted without change to http://www.regulations.gov, including any personal information provided.

FOR FURTHER INFORMATION CONTACT: Mr. Julian E. Thrash, 703-602-0310.

SUPPLEMENTARY INFORMATION:

A. Background

    This action is necessary to ensure that essential contractor 
services are not interrupted. The current changing threat environment, 
particularly under the additional challenges caused by such crises as 
hurricanes, tornados,

[[Page 10192]]

earthquakes, blizzards, floods, or pandemic influenza, has increased 
the need for continuity of operations capabilities and plans that 
enable agencies to continue their essential functions across a broad 
spectrum of emergencies and crises. DoD has established a new 
requirement for contractors to submit their plans to ensure 
continuation of essential contractor services that support mission-
essential functions during a crisis situation.
    DoD Instruction (DoDI) 3020.37, Continuation of Essential DoD 
Contractor Services During Crises, provides the basis for the 
definition of ``essential contractor service,'' which means a service 
provided by a firm or individual under contract to DoD to support 
mission-essential functions, such as support of vital systems, 
including ships owned, leased, or operated in support of military 
missions or roles at sea; associated support activities, including 
installation, garrison, and base support services; and similar services 
provided to foreign military sales customers under the Security 
Assistance Program. Services are essential if the effectiveness of 
defense systems or operations has the potential to be seriously 
impaired by the interruption of such services, as determined by the 
appropriate functional commander or equivalent. As a general rule, the 
designation of services as essential contractor services will not apply 
to an entire contract but will apply only to those service functions 
that have been specifically identified as essential contractor services 
by the functional commander or equivalent.
    DoD is adding a new Subpart 237.76, Continuation of Essential 
Contractor Services, and the new clause at 252.237-7023, Continuation 
of Essential Contractor Services. This clause is required in 
solicitations and contracts for services that are in support of 
mission-essential functions. In accordance with FAR 1.108(d)(3), 
contracting officers may, at their discretion, include these changes in 
any existing contract with appropriate consideration.
    This regulatory action was subject to review under Section 6(b) of 
Executive Order 12866, Regulatory Planning and Review, dated September 
30, 1993. This rule is not a major rule under 5 U.S.C. 804.

B. Regulatory Flexibility Act

    DoD does not expect this interim rule to have a significant 
economic impact on a substantial number of small entities within the 
meaning of the Regulatory Flexibility Act, 5 U.S.C. 601, et seq., 
because the rule allows equitable adjustment for additional costs that 
are incurred during a crisis situation. Therefore, DoD has not 
performed an initial regulatory flexibility analysis. DoD invites 
comments from small business concerns and other interested parties on 
the expected impact of this rule on small entities.
    DoD will also consider comments from small entities concerning the 
existing regulations in subparts affected by this rule in accordance 
with 5 U.S.C. 610. Interested parties must submit such comments 
separately and should cite 5 U.S.C. 610 (DFARS Case 2009-D017) in 
correspondence.

C. Paperwork Reduction Act

    The Paperwork Reduction Act (44 U.S.C. Chapter 35) applies, because 
this interim rule contains an information collection requirement. DoD 
invites comments on the following aspects of the interim rule: (a) 
Whether the collection of information is necessary for the proper 
performance of the functions of DoD, including whether the information 
will have practical utility; (b) the accuracy of the estimate of the 
burden of the information collection; (c) ways to enhance the quality, 
utility, and clarity of the information to be collected; and (d) ways 
to minimize the burden of the information collection on respondents, 
including the use of automated collection techniques or other forms of 
information technology. The following is a summary of the information 
collection requirement.
    Title: Defense Federal Acquisition Regulation Supplement (DFARS) 
2009-D017; Continuation of Essential Contractor Services.
    Type of Request: New collection.
    Number of Respondents: 7,600.
    Responses per Respondents: 1.25.
    Annual Responses: 9,500.
    Average Burden per Response: 2.
    Total Annual Burden Hours: 19,000.
    Needs and Uses: DoD needs this information to ensure essential 
contractor functions are performed for continuity of operations.
    Affected Public: Businesses or other for-profit institutions.
    Frequency: On occasion.
    Respondent's Obligation: Required to obtain contract.
    Written comments and recommendations on the information collection 
proposal should be sent to Ms. Jasmeet Seehra at the Office of 
Management and Budget, Desk Officer for DoD, Room 10236, New Executive 
Office Building, Washington, DC 20503, with a copy to the Defense 
Acquisition Regulations System, Attn: Mr. Julian Thrash, 
OUSD(AT&L)DPAP(DARS), Room 3B855, 3060 Defense Pentagon, Washington, DC 
20301-3060. Comments can be received from 30 to 60 days after the date 
of this notice, but comments to OMB will be most useful if received by 
OMB within 30 days after the date of this notice.
    To request more information on this information collection proposal 
or to obtain a copy of the proposal and associated collection 
instruments, please write to the Defense Acquisition Regulations 
System, Attn: Mr. Julian Thrash.

D. Determination To Issue an Interim Rule

    A determination has been made under the authority of the Secretary 
of Defense (DoD) that urgent and compelling reasons exist to promulgate 
this interim rule without prior opportunity for public comments. This 
action is necessary to ensure that essential contractor services are 
not interrupted by crises such as those caused by hurricanes, tornados, 
earthquakes, blizzards, floods, or pandemic influenza. DoD Instruction 
(DoDI) 3020.37, Continuation of Essential DoD Contractor Services 
During Crises, established the basis for implementing policy, assigning 
responsibilities, and prescribing procedures, to provide a reasonable 
assurance for the continuation of essential contractor services (see 
http://www.dtic.mil/whs/directives/corres/pdf/302037p.pdf). This DoDI 
requires DoD components to rely on the most effective mix of the total 
force, cost and other factors considered, including Active, Reserve, 
civilian, host-nation, and contract resources necessary to fulfill 
assigned peacetime and wartime missions. DoD must take action now to 
ensure essential contractor services are ready to support a total force 
response. The impact to operations posed by not issuing an interim rule 
presents an unacceptable risk to DoD's mission to provide a total force 
response during crisis situations.
    This interim rule clarifies the limited use of the clause for only 
those essential contractor services determined by the functional 
commander, or equivalent, to be necessary to prevent the impairment of 
defense systems or operations. Furthermore, this interim rule also 
clarifies that an equitable adjustment may be appropriate for an 
increase or decrease in the cost incurred in continuing the performance 
of essential contractor services during a crisis situation.

[[Page 10193]]

List of Subjects in 48 CFR Parts 237 and 252

    Government procurement.

Ynette R. Shelkin,
Editor, Defense Acquisition Regulations System.

0
Therefore, 48 CFR parts 237 and 252 are amended as follows:
0
1. The authority citation for 48 CFR parts 237 and 252 continues to 
read as follows:

    Authority: 41 U.S.C. 421 and 48 CFR chapter 1

PART 237--SERVICE CONTRACTING

0
2. Subpart 237.76 is added to read as follows:
SUBPART 237.76--CONTINUATION OF ESSENTIAL CONTRACTOR SERVICES
Sec.
237.7600 Scope.
237.7601 Definitions.
237.7602 Policy.
237.7603 Contract clause.

SUBPART 237.76--CONTINUATION OF ESSENTIAL CONTRACTOR SERVICES


237.7600  Scope.

    This subpart prescribes procedures for the acquisition of essential 
contractor services, which support mission-essential functions.


237.7601  Definitions.

    As used in this subpart--
    Essential contractor service means a service provided by a firm or 
individual under contract to DoD to support mission-essential 
functions, such as support of vital systems, including ships owned, 
leased, or operated in support of military missions or roles at sea; 
associated support activities, including installation, garrison, and 
base support services; and similar services provided to foreign 
military sales customers under the Security Assistance Program, that 
are essential if the effectiveness of defense systems or operations has 
the potential to be seriously impaired by the interruption of these 
services, as determined by the appropriate functional commander or 
equivalent.
    Mission-essential functions means those organizational activities 
that must be performed under all circumstances to achieve DoD component 
missions or responsibilities, the failure of which would significantly 
affect DoD's ability to provide vital services or exercise authority, 
direction, and control.


237.7602  Policy.

    (a) Contractors providing services designated as essential 
contractor services by a requiring activity shall be prepared to 
continue providing such services, in accordance with the terms and 
conditions of their contracts, during periods of crisis. As a general 
rule, the designation of services as essential contractor services will 
not apply to an entire contract but will apply only to those service 
functions that have been specifically identified as essential 
contractor services by the functional commander or equivalent.
    (b) Contractors who provide Government-determined essential 
contractor services shall have a written plan to ensure the 
continuation of these services in crisis situations. Contracting 
officers shall consult with a functional manager to assess the 
sufficiency of the contractor-provided written plan. Contractors will 
activate such plans only during periods of crisis, as directed by the 
appropriate functional commander or equivalent.
    (c) The contracting officer shall follow the procedures at PGI 
207.105(b)(20)(C) in preparing an acquisition plan.


237.7603  Contract clause.

    Use the clause at 252.237-7023, Continuation of Essential 
Contractor Services, in solicitations and contracts for services that 
are in support of mission-essential functions.

PART 252--SOLICITATION PROVISIONS AND CONTRACT CLAUSES

0
2. Section 252.237-7023 is added to read as follows:


252.237-7023,  Continuation of Essential Contractor Services.

    As prescribed in 237.7603, use the following clause:

Continuation of Mission Essential Functions (Date)

    (a) The Government has identified all or a portion of the 
services performed under this contract as essential contractor 
services in support of mission-essential functions. The contractor-
provided services that have been determined to be essential 
contractor services in support of mission-essential functions are 
listed in attachment --,
    Mission-Essential Contractor Services, dated --------.
    (b) The Contractor shall provide a written plan for continuing 
the performance of essential contractor services identified in 
paragraph (a) of this section during a crisis.
    (1) The Contractor shall identify in the plan the provisions 
made for the acquisition of essential personnel and resources, if 
necessary, for continuity of operations for up to 30 days or until 
normal operations can be resumed;
    (2) The plan must, at a minimum, address--
    (i) Challenges associated with maintaining essential contractor 
services during an extended event, such as a pandemic that occurs in 
repeated waves;
    (ii) The time lapse associated with the initiation of the 
acquisition of essential personnel and resources and their actual 
availability on site;
    (iii) The components, processes, and requirements for the 
identification, training, and preparedness of personnel who are 
capable of relocating to alternate facilities or performing work 
from home;
    (iv) Any established alert and notification procedures for 
mobilizing identified ``essential contractor service'' personnel; 
and
    (v) The approach for communicating expectations to contractor 
employees regarding their roles and responsibilities during a 
crisis.
    (3) The Contractor shall maintain and update its plan as 
necessary and adhere to its requirements throughout the contract 
term. The Contractor shall not materially alter the plan without the 
Contracting Officer's consent.
    (4) As directed by the Contracting Officer, the Contractor shall 
participate in training events, exercises, and drills associated 
with Government efforts to test the effectiveness of continuity of 
operations procedures and practices.
    (c) In the event the Contractor anticipates not being able to 
perform any of the essential contractor services identified in 
paragraph (a) of this section during a crisis situation, the 
Contractor shall notify the Contracting Officer or other designated 
representative as expeditiously as possible and use its best efforts 
to cooperate with the Government in the Government's efforts to 
maintain the continuity of operations.
    (d) The Government reserves the right in such crisis situations 
to use Federal employees of other agencies or contract support from 
other contractors or to enter into new contracts for essential 
contractor services. Any new contracting efforts would be conducted 
in accordance with OFPP letter, ``Emergency Acquisitions'' May 2007 
and FAR and DFARS subparts 18 and 218, respectively, or any other 
subsequent emergency guidance issued.
    (e) Changes. The Contractor shall segregate and separately 
identify all costs incurred in continuing performance of essential 
services in a crisis situation. The Contractor shall notify the 
Contracting Officer of an increase or decrease in costs within 
ninety days after continued performance has been directed by the 
Contracting Officer, or within any additional period that the 
Contracting Officer approves in writing, but not later than the date 
of final payment under the contract. The Contractor's notice shall 
include the Contractor's proposal for an equitable adjustment and 
any data supporting the increase or decrease in the form prescribed 
by the Contracting Officer. The parties shall negotiate an equitable 
price adjustment to the
contract price as soon as is practicable after receipt of the 
Contractor's proposal.
    The Contractor shall include the substance of this clause, 
including this paragraph (f), in subcontracts for the essential 
services.

(End of Clause)
[FR Doc. 2010-4730 Filed 3-4-10; 8:45 am]
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