[Federal Register Volume 75, Number 112 (Friday, June 11, 2010)]
[Proposed Rules]
[Page 33237]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2010-14120]



Defense Acquisition Regulations System

48 CFR Part 242

Defense Federal Acquisition Regulation Supplement; Contractor 
Insurance/Pension Review (DFARS Case 2009-D025)

AGENCY: Defense Acquisition Regulations System, Department of Defense 

ACTION: Proposed rule with request for comments.


SUMMARY: DoD proposes to remove and relocate the requirements for 
conducting a Contractor Insurance/Pension Review from Procedures, 
Guidance, and Information to the Defense Acquisition Regulation 

DATES: Comments on the proposed rule should be submitted in writing to 
the address shown below on or before August 10, 2010, to be considered 
in the formation of the final rule.

ADDRESSES: You may submit comments, identified by DFARS Case 2009-D025, 
using any of the following methods:
    Federal eRulemaking Portal: http://www.regulations.gov. Follow the 
instructions for submitting comments.
    E-mail: [email protected]. Include DFARS Case 2009-D025 in the subject 
line of the message.
    Fax: 703-602-0350.
    Mail: Defense Acquisition Regulations System, Attn: Ms. Mary 
Overstreet, OUSD(AT&L)DPAP(DARS), 3060 Defense Pentagon, Room 3B855, 
Washington, DC 20301-3060.
    Comments received generally will be posted without change to http://www.regulations.gov, including any personal information provided.

FOR FURTHER INFORMATION CONTACT: Ms. Mary Overstreet, 703-602-0311.


A. Background

    As part of a DFARS Transformation effort, Defense Acquisition 
Regulation Supplement (DFARS) Case 2003-D050, published at 71 FR 9273, 
February 23, 2006, moved requirements for Contractor Insurance/Pension 
Review (CIPR) from DFARS 242.7302 to Procedures, Guidance, and 
Information (PGI) 242.7302. This DFARS case proposes to move 
requirements for CIPR back to the DFARS from the PGI. The threshold and 
requirements for conducting a CIPR are DoD-wide policy that has a 
significant effect beyond the internal operating procedures of DoD. 
Since conduct of a CIPR impacts industry, as contractors are required 
to provide documentation to support the reviews, the requirements for 
CIPR should be located in the DFARS.

B. Regulatory Flexibility Act

    DoD does not expect this proposed 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. The 
proposed rule merely relocates the requirements for CIPR from the PGI 
to the DFARS. Therefore, an Initial Regulatory Flexibility Analysis has 
not been performed. 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-D025) in 

C. Paperwork Reduction Act

    The Paperwork Reduction Act (Pub. L. 96-511) applies because 
information collection requirements in the proposed rule at DFARS 
subpart 242.73 are currently approved under Office of Management and 
Budget Control Number 0704-0250. Relocating the requirement has no 
impact on the information collection requirement.

List of Subjects in 48 CFR Part 242

    Government procurement.

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

    Therefore, DoD proposes to amend 48 CFR part 242 as follows:


    1. The authority citation for 48 CFR part 242 continues to read as 

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

    2. Revise section 242.7302 to read as follows:

242.7302  Requirements.

    (a)(1) An in-depth CIPR as described at DFARS 242.7301(a)(1) shall 
be conducted only when--
    (i) A contractor has $50 million of qualifying sales to the 
Government during the contractor's preceding fiscal year; and
    (ii) The ACO, with advice from DCMA insurance/pension specialists 
and DCAA auditors, determines a CIPR is needed based on a risk 
assessment of the contractor's past experience and current 
    (2) Qualifying sales are sales for which cost or pricing data were 
required under 10 U.S.C. 2306a, as implemented in FAR 15.403, or that 
are contracts priced on other than a firm-fixed-price or fixed-price 
with economic price adjustment basis. Sales include prime contracts, 
subcontracts, and modifications to such contracts and subcontracts.
    (b) A special CIPR that concentrates on specific areas of a 
contractor's insurance programs, pension plans, or other deferred 
compensation plans shall be performed for a contractor (including, but 
not limited to, a contractor meeting the requirements in paragraph (a) 
of this section) when any of the following circumstances exists, but 
only if the circumstance(s) may result in a material impact on 
Government contract costs:
    (1) Information reveals a deficiency in the contractor's insurance/
pension program.
    (2) The contractor proposes or implements changes in its insurance, 
pension, or deferred compensation plans.
    (3) The contractor is involved in a merger, acquisition, or 
    (4) The Government needs to follow up on contractor implementation 
of prior CIPR recommendations.
    (c) The DCAA auditor shall use relevant findings and 
recommendations of previously performed CIPRs in determining the scope 
of any audits of insurance and pension costs.
    (d) When a Government organization believes that a review of the 
contractor's insurance/pension program should be performed, that 
organization should provide a recommendation for a review to the ACO. 
If the ACO concurs, the review should be performed as part of an ACO-
initiated special CIPR or as part of a CIPR already scheduled for the 
near future.

[FR Doc. 2010-14120 Filed 6-10-10; 8:45 am]