[Federal Register Volume 75, Number 218 (Friday, November 12, 2010)]
[Rules and Regulations]
[Pages 69360-69361]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2010-28494]
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DEPARTMENT OF DEFENSE
Defense Acquisition Regulations System
48 CFR Parts 216 and 252
Defense Federal Acquisition Regulation Supplement; Award-Fee
Reductions for Health and Safety Issues (DFARS Case 2009-D039)
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 implement section 823 of
the National Defense Authorization Act for Fiscal Year 2010. Section
823 requires contracting officers to consider reduction or denial of
award fee if contractor or subcontractor actions jeopardize the health
or safety of Government personnel.
DATES: Effective Date: November 12, 2010.
Comment Date: Comments on the interim rule should be submitted to
the address shown below on or before January 11, 2011, to be considered
in the formation of the final rule.
ADDRESSES: You may submit comments, identified by DFARS Case 2009-D039,
using any of the following methods:
[cir] Federal eRulemaking Portal: http://www.regulations.gov.
Follow the instructions for submitting comments.
[cir] E-mail: [email protected]. Include DFARS Case 2009-D039 in the
subject line of the message.
[cir] Fax: 703-602-0350.
[cir] Mail: Defense Acquisition Regulations Council, Attn: Ms. Amy
G. Williams, OUSD (AT&L) DPAP (DARS), Room 3B855, 3060 Defense
Pentagon, Washington, DC 20301-3060.
Comments received generally will be posted without change to http://www.regulations.gov, including any personal information provided. To
confirm receipt of your comment, please check http://www.regulations.gov approximately two to three days after submission to
verify posting (except allow 30 days for posting of comments submitted
by mail).
FOR FURTHER INFORMATION CONTACT: Ms. Amy G. Williams, 703-602-0328.
SUPPLEMENTARY INFORMATION:
I. Background
Section 823 of the National Defense Authorization Act for Fiscal
Year 2010 (Pub. L. 111-84), requires DoD to revise guidance issued
pursuant to section 814 of the National Defense Authorization Act for
Fiscal Year 2007 (Pub. L. 109-364). Section 823 is entitled ``Authority
for Secretary of Defense to Reduce or Deny Award Fees to Companies
Found to Jeopardize Health or Safety of Government Personnel.'' For
covered contracts that include award fees, if a contractor or its
subcontractor acts with gross negligence or reckless disregard for
health or safety, causing serious bodily injury or death of Government
personnel, then the contracting officer must consider reduction or
denial of award fee for the period in which that action occurred. This
interim rule provides a clause to detail those dispositions where a
reduction or denial of award fee is applicable. The clause also allows
for the recovery of all or part of any award fees paid for any previous
award fee evaluation period during which contractor actions caused
serious bodily injury or death of Government personnel.
II. Executive Order 12866
This is not a significant regulatory action and, therefore, was not
subject to review under section 6(b) of Executive Order 12866,
Regulatory Planning and Review, dated September 30, 1993.
III. 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 most contracts awarded to small entities use simplified
acquisition procedures or, based on the circumstances, may be awarded
on a competitive fixed-price basis or a cost-plus-fixed-fee basis.
Contracts awarded to small businesses do not generally utilize award-
fee type incentive fee structure. 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-D039) in
correspondence.
IV. Paperwork Reduction Act
The Paperwork Reduction Act does not apply because the rule does
not impose any information collection requirements that require the
approval
[[Page 69361]]
of the Office of Management and Budget under 44 U.S.C. 3501, et seq.
V. Determination To Issue an Interim Rule
A determination has been made under the authority of the Secretary
of Defense that urgent and compelling reasons exist to promulgate this
interim rule without prior opportunity for public comments. This action
is necessary because section 823 of the National Defense Authorization
Act for Fiscal Year 2010 requires implementation no later than 180 days
after October 28, 2009. If this requirement is not implemented in the
DFARS, contracting officers may not be aware of the requirement to
consider reduction or denial of the award fee paid in a period in which
actions of gross negligence or reckless disregard of health or safety
by the contractor or its subcontractors caused serious bodily injury or
death of Government personnel. However, pursuant to 41 U.S.C. 418b, DoD
will consider public comments received in response to this interim rule
in the formation of the final rule.
List of Subjects in 48 CFR Parts 216 and 252
Government procurement.
Clare M. Zebrowski,
Editor, Defense Acquisition Regulations System.
0
Therefore, 48 CFR parts 216 and 252 are amended as follows:
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1. The authority citation for 48 CFR parts 216 and 252 continues to
read as follows:
Authority: 41 U.S.C. 421 and 48 CFR chapter 1.
PART 216--TYPES OF CONTRACTS
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2. Sections 216.405-270 and 216.406 are added to subpart 216.4 to read
as follows:
216.405-270 Award fee reduction or denial for jeopardizing the health
or safety of Government personnel.
(a) Definitions.
Covered incident and serious bodily injury, as used in this
section, are defined in the clause at 252.216-7004, Award Fee Reduction
or Denial for Jeopardizing the Health or Safety of Government
Personnel.
(b) In accordance with section 823 of the National Defense
Authorization Act for Fiscal Year 2010 (Pub. L. 111-84), the
contracting officer shall include in the evaluation of any award fee
plan, a review of contractor actions that jeopardized the health and
safety of Government personnel.
(c) If, in performing under a contract, contractor or subcontractor
actions cause serious bodily injury or death of civilian or military
Government personnel, the contracting officer shall consider reducing
or denying the award fee for any of the relevant award fee periods in
which the covered incident occurred, including the recovery of all or
part of any award fees previously paid for such period.
216.406 Contract clauses.
Use the clause at 252.216.7004, Award Fee Reduction or Denial for
Jeopardizing the Health or Safety of Government Personnel, in all
solicitations and contracts containing award fee provisions.
PART 252--SOLICITATION PROVISIONS AND CONTRACT CLAUSES
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3. Section 252.216-7004 is added as follows:
252.216.7004 Award Fee Reduction or Denial for Jeopardizing the Health
or Safety of Government Personnel.
As prescribed in 216.406 use the following clause:
AWARD FEE REDUCTION OR DENIAL FOR JEOPARDIZING THE HEALTH OR SAFETY OF
GOVERNMENT PERSONNEL (NOV 2010)
(a) Definitions. As used in this clause--
Covered incident--
(1) Means any incident in which the Contractor, through a
criminal, civil, or administrative proceeding that results in a
disposition listed in paragraph (2) of this definition--
(i) Has been determined in the performance of this contract to
have caused serious bodily injury or death of any civilian or
military personnel of the Government through gross negligence or
with reckless disregard for the safety of such personnel; or
(ii) Has been determined to be liable for actions of a
subcontractor of the Contractor that caused serious bodily injury or
death of any civilian or military personnel of the Government
through gross negligence or with reckless disregard for the safety
of such personnel.
(2) Includes those incidents that have resulted in any of the
following dispositions:
(i) In a criminal proceeding, a conviction.
(ii) In a civil proceeding, a finding of fault or liability that
results in the payment of a monetary fine, penalty, reimbursement,
restitution, or damage of $5,000 or more.
(iii) In an administrative proceeding, a finding of fault and
liability that results in--
(A) The payment of a monetary fine or penalty of $5,000 or more;
or
(B) The payment of a reimbursement, restitution, or damages in
excess of $100,000.
(iv) In a criminal, civil or administrative proceeding, a
disposition of the matter by consent or compromise with an
acknowledgment of fault by the Contractor if the proceeding could
have led to any of the outcomes specified in paragraphs (2)(i),
(2)(ii), or (2)(iii) of this definition.
Serious bodily injury means a grievous physical harm that
results in a permanent disability.
(b) If, in the performance of this contract, the Contractor's or
its subcontractor's actions cause serious bodily injury or death of
civilian or military Government personnel, the Government may reduce
or deny the award fee for the relevant award fee period in which the
covered incident occurred, including the recovery of all or part of
any award fees paid for any previous period during which the covered
incident occurred.
(End of clause)
[FR Doc. 2010-28494 Filed 11-10-10; 8:45 am]
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