Federal Register / Vol. 74, No. 233 / Monday, December 7, 2009 / The Regulatory Plan 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, costeffective, 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 servicedisabled 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, 


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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 EVerify 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 


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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 Post9/11 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 TRICAREeligible employees to not enroll, or to 

terminate enrollment, in an employeroffered 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 


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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 


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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 


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