DEPARTMENT OF DEFENSE 

Statement of Regulatory Priorities 

Background 

 The Department of Defense (DoD) is the largest Federal department consisting of 3 Military 

departments (Army, Navy, and Air Force), 10 Unified Combatant Commands, 14 Defense 

agencies, and 10 DoD Field Activities. It has 1,434,761 military personnel and 770,569 civilians 

assigned as of June 30, 2010, 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, Treasury, Commerce, and State, and the Office of 

Personnel Management, General Services Administration, and 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. 

 The Department also participates with GSA, NASA, and OFPP to form the Federal Acquisition 

Regulatory Council. The FAR Council assists in the direction and coordination of Government 

wide procurement policy and Government wide procurement regulator activities in the Federal 

Government (41 U.S.C. 421). Together, DOD, GSA, and NASA jointly issue and maintain the 

Federal Acquisition Regulation. 

Administration Priorities: 

1. Rulemakings that promote open Government and that use disclosure as a regulatory tool. 

 The Department plans to: 

• Revise the Federal Acquisition Regulation (FAR) to inform contractors of this statutory 

requirement to make Federal Awardee Performance and Integrity Information System 

information, excluding past performance reviews, available to the public;

• Finalize the FAR rule that implements the requirement for reporting first-tier subcontracting 

data for new contracts using Recovery Act funds; and

• Finalize the FAR rule that implements the Federal Funding Accountability and Transparency 

Act of 2006, which requires the Office of Management and Budget (OMB) to establish a free, 

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public, website containing full disclosure of all Federal contract award information. This rule 

requires contractors to report executive compensation and first-tier subcontractor awards on 

unclassified contracts expected to be $25,000 or more, except contracts with individuals. 

2. Rulemakings that simplify or streamline regulations and reduce or eliminate unjustified 

burdens. 

 The Department plans to: 

• Revise the FAR to delete part 2 of the SF 330, which collects general qualifications data not 

related to a particular planned contract action. The Online Representations and Certifications 

Application (ORCA) now collects this data centrally from interested Architect-Engineer 

vendors at the time they complete the other representations and certifications in ORCA; 

• Revise the FAR to incorporate changes from a final Department of Labor rule that removes 

the requirement to submit complete social security numbers and home addresses of individual 

workers in weekly payroll submissions. Removal of this personal information from payroll 

records avoids unnecessary disclosure issues; 

• Finalize the revision of 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; 

• Remove the DFARS requirement to use DD Forms 2626 and 2631 to report past performance 

information for construction and architect/engineer services instead of the standard FAR 

procedures; 

• Revise the DFARS to permit offerors to provide alternative line-item structure from that shown 

in the solicitation to reflect the offeror’s business practices for selling and billing commercial 

items and initial provisioning spares for weapon systems; 

• Delete redundant DFARS text that limits placement of orders against contracts with 

contractors that have been debarred suspended or proposed for debarment. This requirement 

is now incorporated into the FAR; 

• Propose changes to 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; 

• Establish a method in the DFARS for electronic issuance of orders; and 

• Improve the contract closeout process. 

3. Regulations of Particular Interest to Small Business 

 Of interest to small businesses are regulations to: 

• Implement in the FAR changes to the requirement for small disadvantaged businesses 

certification; 

• Revise the FAR to implement changes in the HUBZone Program, in accordance with Small 

Business Administration regulations; 

• 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; 

• Establish a DoD program to enhance participation of Historically Black Colleges and 

Universities and Minority-Serving Institutions in defense research programs; 

• Conform the DFARS to the FAR with respect to the use of the Electronic Subcontracting 

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Reporting System; and 

• Require public disclosure of justification and approval documents for noncompetitive 8(a) 

contracts over $20 million. 

4. Regulations with international effects or interest 

 Of international effect or interest are regulations to:

• Implement in the FAR statutory certification requirement that each offeror does not engage in 

any activity for which sanctions may be imposed under section 5 of the Iran Sanctions Act. 

Also implements a procurement prohibition relating to contracts with persons that export 

sensitive technology to Iran; 

• Establish in the FAR processes and criteria for waiver of the prohibition on contracting with 

entities that conduct restricted business operations in Sudan; 

• 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 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; 

• Implement in the FAR and DFARS the annual consolidated appropriation act exemption from 

the Buy American Act/Balance of Payments Program restrictions on the acquisition of foreign 

commercial information technology items as construction material; and 

• Finalize in the FAR and DFARS the rules that increase trade agreements thresholds, as 

specified by the United States Trade Representative. 

Specific DoD Priorities:

 For this Regulatory Plan, there are seven 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, and health affairs. 

1. Regulatory Program of the U.S. Army Corps of Engineers 

 In 1988, the Army Corps of Engineers published as appendix B of 33 CFR part 325, a rule that 

governs compliance with the National Environmental Policy Act (NEPA) for the Army’s Regulatory 

Program. On April 2, 2010, the Assistant Secretary of the Army for Civil Works announced that 

the Army Corps of Engineers would conduct rulemaking to modify appendix B to reflect a limited 

change in policy addressing permit applications for surface coal mining activities in Appalachia. 

The modification of appendix B will focus on the NEPA scope of review for considering the effects 

of surface coal mining in Appalachia on the aquatic environment, to enhance protection of aquatic 

resources. 

2. Defense Procurement and Acquisition Policy 

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 The Department of Defense continuously reviews the DFARS and continues to lead 

Government efforts to: 

• 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; 

• Clarify DoD policy in the DFARS regarding the definition and administration of contractor 

business systems to improve the effectiveness of DCMA/DCAA oversight of contractor 

business systems; 

• Implement in the DFARS statutory requirement to inspect military facilities, infrastructure, and 

equipment for safety and habitability prior to use; 

• Revise the FAR to implement the Executive orders relating to allowability of labor relations 

costs, non-displacement of qualified workers, notification of employee rights under Federal 

labor laws, and Federal leadership in environmental, energy, and economic performance; 

• Revise the FAR to adopt biobased procurement preferences and collect contractor information 

on use of biobased products; 

• Revise the FAR to address service contractor employee personal conflicts of interest and 

organizational conflicts of interest and limit contractor access to information; and 

• 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. 

3. 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: 

• 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 to 34694) with an effective 

date of July 17, 2009. The comment period ended August 31, 2009. DoD, in coordination 

with the Department of State and the United States Agency for International Development, 

have prepared a final rule, which includes the responses to the public comments, and 

incorporates changes to the interim final rule, where appropriate. The final rule is expected 

to be published the first or second quarter of FY 2011.

• Interim Final Rule: 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 interim final rule in the first or second quarter of FY 2011.

4. Installations and Environment, Department of Defense 

 The Department of Defense published a rule to assist eligible military and civilian Federal 

employee homeowners: 

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• Final Rule: This rule authorizes 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-inscope 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 allows 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. DoD published an interim final rule on September 30, 2009 (74 FR 50109-50115), with 

an effective date of September 30, 2009. The comment period ended October 30, 2009. The 

final rule published November 16, 2010 (75 FR 69871) with an effective date of January 18, 

2011. 

5. Military Personnel Policy, 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, Public Law 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 to 30220) with an effective date of June 25, 

2009. The comment period ended July 27, 2009. DoD anticipates finalizing this rule in the 

spring of 2011. 

6. Military Community and Family Policy, Department of Defense 

 The Department of Defense published or plans to publish a rule to implement policy, assign 

responsibilities, and prescribe procedures for the operation of voluntary education programs 

within DoD.

• Proposed Rule: This rule implements policy, assigns responsibilities, and prescribes 

procedures for the operation of voluntary education programs within DoD. Included are: 

Procedures for Service members participating in education programs; guidelines for 

establishing, maintaining, and operating voluntary education programs; procedures for 

obtaining on-base voluntary education programs and services; minimum criteria for selecting 

institutions to deliver higher education programs and services on military installations; and 

the Memorandum of Understanding between educational institutions and DoD prior to the 

disbursement of tuition assistance funds. This is an economically significant rule. The 

proposed rule published August 6, 2010 (75 FR 47504-47515). The comment period ends 

October 5, 2010. DoD anticipates finalizing this rule in the spring or fall of FY 2011. 

7. 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 provided an additional opportunity for 

comment on the final rule of March 17, 2009, implementing provisions of section 703 of the 

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National Defense Authorization Act for Fiscal Year 2008. This statute extended 

pharmaceutical Federal Ceiling Prices to TRICARE Retail Pharmacy Program prescriptions. 

The Department of Defense (DoD) issued a final rule on March 17, 2009, implementing the 

law. On November 30, 2009, the U.S. District Court for the District of Columbia “ordered that 

the final rule is remanded without vacatur for the Defense Department to consider in its 

discretion whether to readopt the current iteration of the rule or adopt another approach to 

implement 10 U.S.C. 1074g(f).” As part of DoD's reconsideration, DoD solicited public 

comments on the implementation of the statute, DoD's resulting regulations, and the matters 

addressed for DoD's consideration in the Court's Memorandum Opinion. The proposed rule 

was published February 9, 2010 (75 FR 6335-6336). The comment period ended on March 

11, 2010. DoD anticipates publishing a second final rule in the first quarter of FY 2011. 

• Final rule on TRICARE: Relationship Between the TRICARE Program and EmployerSponsored 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. The final rule published April 9, 2010 (75 FR 18051 to 18055) with an 

effective date of June 18, 2010. 

• Proposed rule on TRICARE: Sole Community Hospital Payment Reform. This rule 

implements the statutory provision in section 1079(j)(2) of title 10, United States Code that 

TRICARE payment methods for institutional care shall be determined to the extent 

practicable in accordance with the same reimbursement rules as those that apply to 

payments to providers of services of the same type under Medicare. This proposed rule 

implements a reimbursement methodology similar to that furnished to Medicare beneficiaries 

for services provided by sole community hospitals. DoD anticipates publishing a proposed 

rule in the first or second quarter of FY 2011. 

• Proposed rule on TRICARE: Long Term Care Hospital Prospective Payment System. This 

rule adopts a reimbursement methodology for Long Term Care Hospitals similar to 

Medicare’s Long Term Care Hospital Prospective Payment System. DoD anticipates 

publishing a proposed rule in the spring of FY 2011. 

8. Networks and Information Integration, Department of Defense 

 The Department of Defense will publish a rule regarding Defense Industrial Base Voluntary 

Cyber Security and Information Assurance Information Sharing: 

• Interim Final Rule: This rule establishes cyber threat information sharing, reporting, and 

analysis mechanisms between DoD and cleared Defense Industrial Base (DIB) contractors 

to enhance cyber threat situational awareness and threat response. The rule establishes a 

voluntary information sharing environment with DIB partners to address the unacceptable 

risk and imminent threat to national and economic security stemming from the unauthorized 

access by U.S. adversaries or business competitors to critical DoD unclassified information 

resident on, or transiting, DIB unclassified networks. The rule describes the collaborative 

DoD and DIB corporate-level partnership to enhance security of DIB networks; increase 

USG and industry knowledge of advanced cyber threats; provide near-real time cyber threat 

information sharing and understand the impact of data compromise on DoD operational 

activities. Participation in the DIB Cyber Security/Information Assurance program is voluntary 

and open to all qualified cleared contractors. DoD anticipates publishing an interim final rule 

in the second quarter of FY 2011. 

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The 2 Actions Described in the Regulatory Plan

Title

Regulation 

Identifier 

Number

Rulemaking 

Stage

TRICARE; Reimbursement of Sole Community Hospitals 0720-AB41 Proposed Rule Stage

Voluntary Education Programs 0790-AI50 Final Rule Stage

Department of Defense (DOD) 

Office of Assistant Secretary for Health Affairs ( DODOASHA ) RIN: 0720-AB41

 View Related Documents

Title: TRICARE; Reimbursement of Sole Community Hospitals

Abstract: This proposed rule is to implement the statutory provision at 10 U.S.C. 1079(j)(2) that TRICARE payment methods

for institutional care be determined, to the extent practicable, in accordance with the same reimbursement rules as those that

apply to payments to providers of services of the same type under Medicare. This proposed rule implements a reimbursement

methodology similar to that furnished to Medicare beneficiaries for inpatient services provided by Sole Community Hospitals

(SCHs). It will be phased in over a several-year period.

Priority: Economically Significant Agenda Stage of Rulemaking: Proposed Rule

Major: Yes Unfunded Mandates: No

CFR Citation: 32 CFR 199 (To search for a specific CFR, visit the Code of Federal Regulations ) 

Legal Authority: 5 USC 301; 10 USC ch 55

Legal Deadline: None

Regulatory Plan:

Statement of Need: This rule is being published to implement the statutory provision in 10 U.S.C. 1079(j)(2), that

TRICARE payment methods for institutional care be determined, to the extent practicable, in accordance with the same

reimbursement rules as apply to payments to providers of services of the same type under Medicare. This proposed rule

implements a reimbursement methodology similar to that furnished to Medicare beneficiaries for inpatient services provided by

Sole Community Hospitals.

Legal Basis: There is a statutory basis for this proposed rule: 10 U.S.C. 1079(j)(2).

Alternatives: Alternatives were considered for phasing in the needed reform and an alternative was selected for a gradual,

smooth transition.

Costs and Benefits: We estimate the total reduction (from the proposed changes in this rule) in hospital revenues under

the SCH reform for its first year of implementation (assumed for purposes of this RIA to be FY 2011), compared to expenditures

in that same period without the proposed SCH changes, to be approximately $190 million. The estimated impact for FYs 2012

through 2015 (in $ millions) is $208, $229, $252, and $278 respectively.

Risks: Failure to publish this proposed rule would result in noncompliance with a statutory provision.

Timetable:

Action Date FR Cite

NPRM 12/00/2010 

Regulatory Flexibility Analysis Required: Business;

Organizations Government Levels Affected: No

Federalism: No

Energy Affected: No

Agency Contact: Marty Maxey Department of Defense

Office of Assistant Secretary for Health Affairs

1200 Defense Pentagon

Washington , DC 20301 

Phone: 303 676-3627 

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Department of Defense (DOD) 

Office of the Secretary ( OS ) RIN: 0790-AI50

 View Related Documents

Title: Voluntary Education Programs

Abstract: This rule implements policy, assigns responsibilities, and prescribes procedures for the operation of voluntary

education programs within DoD. Included are: Procedures for Service members participating in education programs; guidelines

for establishing, maintaining, and operating voluntary education programs, including but not limited to, instructor-led courses

offered on-installation and off-installation, as well as via distance learning; procedures for obtaining on-base voluntary education

programs and services; minimum criteria for selecting institutions to deliver higher education programs and services on military

installations; the establishment of a DoD Voluntary Education Partnership Memorandum of Understanding between DoD and

educational institutions receiving tuition assistance payments; and procedures for other education programs for Service

members and their adult family members.

Priority: Economically Significant Agenda Stage of Rulemaking: Final Rule

Major: Yes Unfunded Mandates: No

CFR Citation: 32 CFR 68 (To search for a specific CFR, visit the Code of Federal Regulations ) 

Legal Authority: 10 USC 2005; 10 USC 2007

Legal Deadline: None

Regulatory Plan:

Statement of Need: This rule implements policy, assigns responsibilities, and prescribes procedures for the operation of

voluntary education programs within DoD. Included are: Procedures for Service members participating in education programs;

guidelines for establishing, maintaining, and operating voluntary education programs, including but not limited to, instructor-led

courses offered on-installation and off-installation, as well as via distance learning; procedures for obtaining on-base voluntary

education programs and services; minimum criteria for selecting institutions to deliver higher education programs and services

on military installations; the establishment of a DoD Voluntary Education Partnership Memorandum of Understanding between

DoD and educational institutions receiving tuition assistance payments; and procedures for other education programs for

Service members and their adult family members.

Legal Basis: sections 2005 and 2007 of title 10, United States Code

Alternatives: None.

Costs and Benefits: Voluntary Education Programs include: High School Completion /Diploma; Military Tuition Assistance

(TA); Postsecondary Degree Programs; Independent Study and Distance Learning Programs; College Credit Examination

Program; Academic Skills Program; and Certification/Licensure Programs. Funding for Voluntary Education Programs during

2009 was $800 million, which included tuition assistance and operational costs. This funding provided more than 650,000

individuals (Service members and their adult family members) the opportunity to participate in Voluntary Education Programs

around the world.

Risks: None.

Timetable:

Action Date FR Cite

NPRM 08/06/2010 75 FR 47504 

NPRM Comment Period End 10/05/2010 

Final Action 04/00/2011 

Regulatory Flexibility Analysis Required: No Government Levels Affected: No

Small Entities Affected: No Federalism: No

Energy Affected: No

Agency Contact: Kerrie Tucker Department of Defense

Office of the Secretary

Defense Pentagon

Washington , DC 20301 

Phone: 703 602-4949 Extension: 117 

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