[Federal Register Volume 74, Number 94 (Monday, May 18, 2009)]
[Rules and Regulations]
[Pages 23120-23127]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E9-11522]


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DEPARTMENT OF ENERGY

48 CFR Parts 904, 952 and 970

RIN 1991-AB71


Acquisition Regulation: Security Clause

AGENCY: Department of Energy.

ACTION: Final rule.

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SUMMARY: The Department of Energy (DOE) is amending the Department of 
Energy Acquisition Regulation (DEAR) to revise the security clause used 
in all contracts and subcontracts involving access authorizations to 
specifically require background reviews, and tests for the absence of 
any illegal drug, as defined in DOE regulations of uncleared personnel 
(employment applicants and current employees), who will require access 
authorizations. Background reviews would not be required for applicants 
for DOE access authorization who possess a current access authorization 
from another Federal agency.

DATES: Effective Date: June 17, 2009.

FOR FURTHER INFORMATION CONTACT: Richard Langston at 202-287-1339 or 
<a href="/cdn-cgi/l/email-protection#beecd7ddd6dfccda90f2dfd0d9cdcad1d0fed6cf90dad1db90d9d1c8"><span class="__cf_email__" data-cfemail="11437872797063753f5d707f7662657e7f5179603f757e743f767e67">[email protected]</span></a>.

SUPPLEMENTARY INFORMATION: 

I. Background
II. Comments and Responses
III. Procedural Requirements
    A. Review Under Executive Order 12866
    B. Review Under Executive Order 12988
    C. Review Under the Regulatory Flexibility Act
    D. Review Under the Paperwork Reduction Act
    E. Review Under the National Environmental Policy Act
    F. Review Under Executive Order 13132
    G. Review Under the Unfunded Mandates Reform Act of 1995
    H. Review Under the Treasury and General Government 
Appropriations Act, 1999
    I. Review Under Executive Order 13211
    J. Review Under the Treasury and General Government 
Appropriations Act, 2001
    K. Review Under the Small Business Regulatory Enforcement 
Fairness Act of 1996
    L. Approval by the Office of the Secretary of Energy

I. Background

    Many DOE contractor and subcontractor employees require access 
authorizations for access to classified information (restricted data, 
formerly restricted data, or national security information) or certain 
quantities of special nuclear material in order to perform official 
duties. On February 19, 2008, DOE published a notice of proposed 
rulemaking to revise the Department of Energy Acquistion (DEAR) 
regulations to require the security clause used in certain contracts 
and subcontracts to specifically require contractors and subcontractors 
to conduct background checks and tests for illegal drugs of uncleared 
applicants and employees who will require DOE access authorizations (73 
FR 9071). Under the proposed rule, the background check included the

[[Page 23121]]

collection and review by the contractor of items such as credit checks, 
and contacts with personal references and certain past employers. It 
then required contractors to assess the ``job qualifications and 
suitability'' of uncleared applicants and employees before assigning 
them to positions requiring an access authorization and before 
requesting that DOE process the individual for an access authorization. 
A contractor would determine ``suitability'' by assessing the possible 
impact of ``adverse information'' found in the background check and 
deciding whether it is ``confident'' that an individual would pass the 
rigorous background investigation conducted by DOE for a position 
requiring an access authorization. A contractor's assessment of the 
information would be guided by the criteria set forth in 10 CFR 710.8, 
used by the federal government to assess an individual's eligibility 
for an access authorization.
    After considering public comments, DOE today revises several 
sections of the proposed rule, including amending Section 952.204-
2(h)(2) to eliminate the requirement that a contractor consider the 
criteria in 10 CFR 710.8 in determining whether to select an individual 
for a position requiring an access authorization. In particular, the 
requirement that a contractor determine an applicant's ``suitability'' 
for an access authorization has been removed. Rather, a contractor must 
conduct a background check (now defined in the final rule as a 
``review'' or ``background review'') of such individuals prior to 
selection, evaluate the individual based on its own processes and 
consistent with applicable law, and then send specified information set 
out in the rule to DOE.
    Other changes to the proposed rule include revising Section 904.404 
to add a requirement in paragraph (d)(1) that the security clause is 
required in any contract that will involve contractor employees' access 
to special nuclear material. That requirement reflects past DOE 
practice and is being added to make the instruction clear and complete. 
Section 952.204-2, Security, is revised by changing the title of the 
section to ``Security'' and by revising its introductory text to 
conform to the more recent Federal Acquisition Regulation format. As a 
matter of administrative convenience, in addition to the provisions 
regarding the review of employees and applicants, the rule includes 
provisions implementing certain technical changes to the format of the 
DEAR provisions at issue here. Some of the requirements at 970.2201-1-
2, are appropriate to other types of contracts if access authorizations 
are required, so language at 970.2201-1-2 is being restated in the 
security clause.

II. Comments and Responses

    Comments were received from three organizations, two of which were 
from DOE National Laboratories and another from an aircraft 
manufacturer.
    The first DOE National Laboratory offered 4 comments.
    Comment 1.
    This comment regards the contract clause entitled Security at 
952.204-2, specifically (2) Job Qualifications and Suitability.
    This section directs contractors to assess the possible impact of 
adverse information found during the course of a background check 
relative to the individual's suitability for a position requiring an 
access authorization and act accordingly. Criteria cited following this 
statement are the access authorization criteria found in 10 CFR 710.8, 
however criteria referenced earlier in the section cites background 
checks are being used to determine employment suitability in accordance 
with the contractor's personnel policies.
    It is unclear as to what is required to be determined, suitability 
for employment or suitability for an access authorization. Suitability 
for an access authorization in accordance with 10 CFR 710.8 is an 
adjudicative decision rendered by a federal employee who has been 
designated and trained to perform this function. Is it expected that 
the contractor, after assessing the impacts of adverse information in 
accordance with 10 CFR 710.8, refuse to submit an individual for an 
access authorization even though the individual has been determined 
eligible for employment in accordance with the contractor's personnel 
policies?
    Under what adjudicative authority is this determination authorized?
    Response 1.
    DOE is revising Section 952.204-2(h)(2) to eliminate: (1) the 
requirement that a contractor apply the criteria at 10 CFR 710.8 in 
determining whether to select an uncleared applicant or uncleared 
employee for a position requiring an access authorization; and (2) any 
requirement that a contractor determine the ``suitability'' of an 
individual for an access authorization. The rule has been revised to 
clarify that it only requires a contractor to collect information and 
conduct a review of an uncleared applicant or uncleared employee, prior 
to selecting an individual for a position requiring an access 
authorization, to evaluate that individual pursuant to the contractor's 
personnel policies and applicable law, and then to send to the head of 
the cognizant local DOE Security Office the information set out in the 
regulation at Section 952.204-2(h)(2)(vi) for selected individuals. 
Under this rule, a decision as to whether an individual is eligible for 
an access authorization remains a DOE or Federal security decision.
    Comment 2.
    For individuals under contract who require an access authorization 
or small companies where the company owners are the employees, are 
background checks required? Who renders the determination? What 
suitability is being determined and under what criteria--employment or 
access authorization?
    Response 2.
    An individual's status as an employee, manager or owner has no 
bearing on DOE's determination as to whether to grant the individual an 
access authorization.
    Comment 3.
    This comment regards paragraph (j) Foreign Ownership, Control or 
Influence (FOCI) of the Security clause.
    DOE facility clearance requirements as promulgated in DOE M 470.4-
1, Chg. 1, require processing of facility clearances for circumstances 
that do not involve access authorizations (i.e., Cat IV SNM, possession 
of hazardous materials that present radiological/toxicological/
biological sabotage threats and possession of DOE property greater than 
five million dollars in value). Foreign Ownership, Control or Influence 
requirements only apply when access authorizations are required. The 
comment recommends that this paragraph's applicability be qualified.
    Response 3.
    Generally, only contracts involving restricted data or national 
security information or access to special nuclear material and thus 
requiring access authorizations would require use of the Security 
clause. DOE M 470.4-1, Chg. 1, at paragraph 5.b.2., requires Foreign 
Ownership, Control or Influence coverage in any contract containing the 
Security clause. DOE does not believe any further applicability 
guidance is necessary. In the situation where a Foreign Ownership, 
Control or Influence determination and a facility clearance are 
required, but access authorizations will not be required for the 
employees of the contractor, the pre-employment review and drug tests 
that are described in the security clause are not required since these 
requirements are only applicable to positions requiring access 
authorizations.
    Comment 4.
    This comment relates to paragraph (l), Flow down to subcontracts, 
of the security clause.

[[Page 23122]]

    Given the applicability of the facility clearance requirements, 
flow down to only those contracts that require access authorizations 
appears to be inconsistent. In addition, the criteria relative to 
employment eligibility identified in Part 970 apply to DOE management 
and operating (M&O) contractors. What criteria are to be used for 
contractors who are not M&O contractors?
    Response 4.
    This rule does not specify criteria that a DOE M&O or a non-M&O 
contractor must use in assessing the eligibility for employment of an 
individual that the contractor is considering for a position requiring 
an access authorization. Nor is the rule limited to M&O contractors. 
Rather, it incorporates changes to both Parts 952 and 970. Paragraph 
(l) of the security clause at 952.204-2 correctly states that the rule 
is applicable to all contracts and subcontracts which involve 
restricted data, national security information, or special nuclear 
material.
    Facility clearances are the subject of a separate clause at 
952.204-73 and involve the assessment of a facility, not the assessment 
of individuals for access to restricted data, national security 
information, or possession of special nuclear material, which is the 
subject of this rulemaking. Moreover, a facility clearance may be 
required for reasons other than restricted data, national security 
information, or possession of special nuclear material. For example, a 
facility clearance may be required where a contractor has possession of 
unusually valuable Government property. Not all individual contractor 
employees at a facility that hold a facility clearance are required to 
have access authorizations. Only the individual contractor employees at 
such facilities who require access to restricted data, national 
security information, or possession of special nuclear material at 
sites with facility clearances need access authorizations.
    The second DOE National Laboratory offered 1 comment.
    Comment 5.
    Paragraph (h)(2) of the proposed security clause amendment contains 
the following statement:
    ``Contractors must propose personnel to work in positions requiring 
access authorizations only if they are confident that the individuals 
will pass the rigorous background review that DOE will conduct.''
    DOE's rigorous background review is based on criteria found at 10 
CFR 710.8. Those criteria include references to a person's likely place 
of origin (e), illness or mental condition (h), alcohol dependence (j), 
bankruptcy--pattern of financial irresponsibility (l), among others. 
While the proposed rule represents an understandable aspiration, the 
proposed rule places contractors in an untenable position. Contractors 
would be required to violate anti-discrimination laws, the Americans 
with Disabilities Act, and the bankruptcy laws, among others. This 
situation is not one contractors relish. The Government alone is 
traditionally authorized to make decisions involving trade-offs between 
the Government's legitimate goals of treating its citizens fairly and 
its national security interests. If a contractor refused to hire or 
retain an individual for one of the reasons above, the contractor would 
open the door to litigation; litigation that would not arise if the 
Government exercises its inherent functions.
    DOE Response 5.
    DOE has removed all references to the criteria found at 10 CFR 
710.8, and will, under this rule, require contractors to comply with 
all laws, regulations, and Executive Orders in processing an 
individual's information and in considering whether to select an 
individual for a position requiring an access authorization.
    The aircraft manufacturer offered 7 comments.
    Comment 6.
    The reviewer noted that the proposed Security clause at page 9073 
was dated 2007 and suggested that it should be changed.
    Response 6.
    DOE agrees and the rule will specify the correct month and year of 
the clause's effective date in this final rule.
    Comment 7.
    Subparagraph (a) of the proposed security clause contains 
references to the terms ``classified information,'' ``classified 
documents,'' ``classified matter,'' and ``classified materials,'' which 
are confusing. We believe that the terms ``classified matter'' at lines 
16 and 21, ``material'' at line 25, and ``matter'' at line 30 of the 
clause should all be revised to the terms ``classified documents'' or 
``classified articles.''
    Response 7.
    DOE has made clarifying changes in response to this comment. DOE is 
revising the second sentence to read ``The Contractor shall, in 
accordance with DOE security regulations and requirements, be 
responsible for protecting all classified information and all 
classified matter (including documents, material and special nuclear 
material), which is in the contractor's possession in connection with 
the performance of work under this contract, against sabotage, 
espionage, loss or theft.'' Additionally, DOE is changing ``material'' 
to ``matter'' where it is used in the fourth sentence, and is changing 
``matter'' in the fifth sentence to ``classified matter.'' The two uses 
of ``classified matter'' in the third and fourth sentences are correct 
because classified matter can be any combination of classified 
documents or other classified material.
    Comment 8.
    Under the terms of subparagraph (h)(2) of the proposed security 
clause, the contractor is responsible for conducting the background 
investigation and forwarding the results to DOE. This would seem risky 
because it necessitates two investigations, one by the contractor and 
another by DOE to verify what the contractor submitted. Also, at 
subparagraph (h)(2), DOE should revise ``afforded access to classified 
information or matter'' to ``afforded access to classified information, 
classified documents, or classified articles.''
    Response 8.
    The rule has been revised to clarify that the review required by 
the security clause is for the purpose of gathering information to be 
considered by the contractor before selecting an individual for a 
position that requires a DOE access authorization. It is not the 
equivalent of the background investigation that will be conducted by 
the federal government prior to the granting or denial of an access 
authorization request. With respect to the suggested language change, 
DOE believes the proposed language--``afforded access to classified 
information or matter''--is technically correct, and therefore, is not 
adopting the suggestion.
    Comment 9.
    At subparagraph (h)(3)(i) of the proposed clause, revise the term 
``classified information'' in lines 5 and 6 to ``classified information 
and classified documents.''
    Response 9.
    The Department does not adopt this recommendation because it would 
be inappropriate for this prohibition to apply only when both 
classified information and classified documents are disclosed to the 
same, unauthorized person. The term ``classified information'' is 
inclusive in that documents, parts, audible conversation, matter in 
cyber (electronic) or other form, etc. all become classified on the 
basis of their containing, revealing, or embodying classified 
information.
    Comment 10.
    At subparagraph (j) ``Foreign Ownership, Control or Influence,'' 
failure to satisfy the requirements of the clause is grounds for 
termination for default per paragraph (j)(4). We believe

[[Page 23123]]

what is intended is default for failure to comply with subparagraph 
(j)(1). We believe the term ``this clause'' should be revised to read 
paragraph (j)(1).
    Response 10.
    DOE does not wish to limit its right to terminate to just paragraph 
(j)(1).
    Comment 11.
    Subparagraph (k), ``Employment announcements'' requires a 
contractor to include a detailed notification in a written vacancy 
announcement. Failing to follow this requirement explicitly should not 
be a justification for the contracting officer to terminate the 
contractor for default. The requirement should be clarified as to 
whether it applies to internal announcements as well.
    Response 11.
    DOE will determine the appropriate remedy for failure to comply 
with the requirements for notice about reviews and drug testing 
requirements in vacancy announcements on a case-by-case basis. This 
final rule does not cover language included in an announcement that is 
internal to the contractor's workplace.
    Comment 12.
    The reviewer suggests that subparagraph (k) be revised to require 
that applicants be told that a background check, drug testing, etc., 
will be required rather than requiring contractors to include this 
detail in the vacancy announcement. The reviewer questions the benefit 
from including the detail in the vacancy announcement and is concerned 
it simply announces to the world that the employer does classified work 
for the United States Government.
    Response 12.
    DOE is retaining the requirement that advance notice be given to 
potential applicants as part of the written vacancy announcement. This 
ensures that all applicants are given the same advance notification of 
the requirements before time and effort are expended by the applicant 
and employee.

III. Procedural Requirements.

A. Review Under Executive Order 12866

    This regulatory action has been determined not to be a significant 
regulatory action under Executive Order 12866, Regulatory Planning and 
Review (58 FR 51735, October 4, 1993). Accordingly, this final rule is 
not subject to review under the Executive Order by the Office of 
Information and Regulatory Affairs (OIRA) within the Office of 
Management and Budget.

B. Review Under Executive Order 12988

    With respect to the review of existing regulations and the 
promulgation of new regulations, section 3(a) of Executive Order 12988, 
Civil Justice Reform (61 FR 4729, February 7, 1996), imposes on 
executive agencies the general duty to adhere to the following 
requirements: (1) Eliminate drafting errors and ambiguity; (2) write 
regulations to minimize litigation; (3) provide a clear legal standard 
for affected conduct rather than a general standard; and (4) promote 
simplification and burden reduction. With regard to the review required 
by section 3(a), section 3(b) of Executive Order 12988 specifically 
requires that executive agencies make every reasonable effort to ensure 
that the regulation: (1) Clearly specifies the preemptive effect, if 
any; (2) clearly specifies any effect on existing Federal law or 
regulation; (3) provides a clear legal standard for affected conduct 
while promoting simplification and burden reduction; (4) specifies the 
retroactive effect, if any; (5) adequately defines key terms; and (6) 
addresses other important issues affecting clarity and general 
draftsmanship under any guidelines issued by the Attorney General. 
Section 3(c) of Executive Order 12988 requires executive agencies to 
review regulations in light of applicable standards in section 3(a) and 
section 3(b) to determine whether they are met or that it is 
unreasonable to meet one or more of them. DOE has completed the 
required review and determined that, to the extent permitted by law, 
these regulations meet the relevant standards of Executive Order 12988.

C. Review Under the Regulatory Flexibility Act

    This rule has been reviewed under the Regulatory Flexibility Act, 5 
U.S.C. 601 et seq., which requires preparation of an initial regulatory 
flexibility analysis for any rule that must be proposed for public 
comment and that is likely to have a significant economic impact on a 
substantial number of small entities. The rule would not have a 
significant economic impact on small entities because it imposes no 
significant burdens. Any costs incurred by DOE contractors complying 
with the rule would be reimbursed under the contract.
    Accordingly, DOE certifies that this rule would not have a 
significant economic impact on a substantial number of small entities, 
and, therefore, no regulatory flexibility analysis is required and none 
has been prepared.

D. Review Under the Paperwork Reduction Act

    This final rule contains no new information collection or 
recordkeeping requirements. Information collection or recordkeeping 
requirements mentioned in this rule relative to the facility clearance 
and access authorization processes have been previously cleared under 
Office of Management and Budget (OMB) paperwork clearance package 
number 0704-0194 for facility clearances processed by the Department of 
Defense for Standard Form (SF) 283, or package number 3206-0007 
processed by the Office of Personnel Management for personnel access 
authorizations using SF 86.

E. Review Under the National Environmental Policy Act

    DOE has concluded that promulgation of this rule falls into a class 
of actions which would not individually or cumulatively have 
significant impact on the human environment, as determined by DOE's 
regulations (10 CFR Part 1021, Subpart D) implementing the National 
Environmental Policy Act (NEPA) of 1969 (42 U.S.C. 4321 et seq.). 
Specifically, this rule is categorically excluded from NEPA review 
because the amendments to the DEAR would be strictly procedural 
(categorical exclusion A6). Therefore, this rule does not require an 
environmental impact statement or environmental assessment pursuant to 
NEPA.

F. Review Under Executive Order 13132

    Executive Order 13132 (64 FR 43255, August 4, 1999) imposes certain 
requirements on agencies formulating and implementing policies or 
regulations that preempt state law or that have federalism 
implications. Agencies are required to examine the constitutional and 
statutory authority supporting any action that would limit the 
policymaking discretion of the states and carefully assess the 
necessity for such actions. DOE has examined today's rule and has 
determined that it does not preempt state law and does not have a 
substantial direct effect on the states, on the relationship between 
the national government and the states, or on the distribution of power 
and responsibilities among the various levels of government. No further 
action is required by Executive Order 13132.

G. Review Under the Unfunded Mandates Reform Act of 1995

    The Unfunded Mandates Reform Act of 1995 (Pub. L. 104-4) requires a 
federal agency to perform a detailed assessment of costs and benefits 
of any rule imposing a federal mandate with costs to state, local or 
tribal governments, or to the private sector, of $100 million or more 
in any single year. This rule does not impose a federal

[[Page 23124]]

mandate on state, local or tribal governments or on the private sector.

H. Review Under the Treasury and General Government Appropriations Act, 
1999

    Section 654 of the Treasury and General Government Appropriations 
Act, 1999 (Pub. L. 105-277), requires federal agencies to issue a 
Family Policymaking Assessment for any rule or policy that may affect 
family well-being. This rule will have no impact on family well being.

I. Review Under Executive Order 13211

    Executive Order 13211, Actions Concerning Regulations That 
Significantly Affect Energy Supply, Distribution, or Use (66 FR 28355, 
May 22, 2001), requires federal agencies to prepare and submit to the 
Office of Information and Regulatory Affairs (OIRA), OMB, a Statement 
of Energy Effects for any significant energy action. A ``significant 
energy action'' is defined as any action by an agency that promulgates 
or is expected to lead to promulgation of a final rule, and that: (1) 
Is a significant regulatory action under Executive Order 12866, or any 
successor order; (2) is likely to have a significant adverse effect on 
the supply, distribution, or use of energy; or (3) is designated by the 
Administrator of OIRA as a significant energy action. For any 
significant energy action, the agency must give a detailed statement of 
any adverse effects on energy supply, distribution, or use should the 
proposal be implemented, and of reasonable alternatives to the action 
and their expected benefits on energy supply, distribution, and use.
    Today's rule is not a significant energy action. Accordingly, DOE 
has not prepared a Statement of Energy Effects.

J. Review Under the Treasury and General Government Appropriations Act, 
2001

    The Treasury and General Government Appropriations Act, 2001, 44 
U.S.C. 3516 note, provides for agencies to review most disseminations 
of information to the public under implementing guidelines established 
by each agency pursuant to general guidelines issued by OMB. OMB's 
guidelines were published at 67 FR 8452 (February 22, 2002), and DOE's 
guidelines were published at 67 FR 62446 (October 7, 2002). DOE has 
reviewed today's notice under the OMB and DOE guidelines and has 
concluded that it is consistent with applicable policies in those 
guidelines.

K. Review Under the Small Business Regulatory Enforcement Fairness Act 
of 1996

    As required by 5 U.S.C. 801, the Department will report to Congress 
promulgation of this rule prior to its effective date. The report will 
state that it has been determined that the rule is not a ``major rule'' 
as defined by 5 U.S.C. 804(3).

L. Approval by the Office of the Secretary of Energy.

    The Office of the Secretary of Energy has approved issuance of this 
final rule.

List of Subjects in 48 CFR Parts 904, 952 and 970

    Government procurement.

    Issued in Washington, DC, on May 13, 2009.
Edward R. Simpson,
Director, Office of Procurement and Assistance Management, Office of 
Management, Department of Energy.
David O. Boyd,
Director, Office of Acquisition and Supply Management, National Nuclear 
Security Administration.

0
For the reasons set out in the preamble, DOE amends Chapter 9 of Title 
48 of the Code of Federal Regulations as set forth below:

PART 904--ADMINISTRATIVE MATTERS

0
1. The authority citations for parts 904 and 952 continue to read as 
follows:

    Authority:  42 U.S.C. 7101, et seq.; 41 U.S.C. 418(b); 50 U.S.C. 
2401, et seq.


0
2. In section 904.401, add in alphabetical order, new definitions for 
``applicant'' and ``review or background review'' and revise the 
definitions of ``classified information'' and ``restricted data'' to 
read as follows:


904.401  Definitions.

* * * * *
    Applicant means an individual who has submitted an expression of 
interest in employment; who is under consideration by the contractor 
for employment in a particular position; and who has not removed 
himself or herself from further consideration or otherwise indicated 
that he or she is no longer interested in the position.
    Classified information means information that is classified as 
restricted data or formerly restricted data under the Atomic Energy Act 
of 1954, or information determined to require protection against 
unauthorized disclosure under Executive Order 12958, Classified 
National Security Information, as amended, or prior executive orders, 
which is identified as national security information.
* * * * *
    Restricted data means all data concerning design, manufacture, or 
utilization of atomic weapons; production of special nuclear material; 
or use of special nuclear material in the production of energy, but 
excluding data declassified or removed from the restricted data 
category pursuant to Section 142, as amended, of the Atomic Energy Act 
of 1954 (42 U.S.C. 2162).
* * * * *
    Review or background review means a Contractor's assessment of the 
background of an uncleared applicant or uncleared employee for a 
position requiring a DOE access authorization prior to selecting that 
individual for such a position.


904.404  [Amended]

0
3. Section 904.404 is amended by adding the words ``, access to special 
nuclear materials or the provision of protective services'' after the 
words ``classified information'' at the end of the first sentence of 
paragraph (d)(1).

PART 952--SOLICITATION PROVISIONS AND CONTRACT CLAUSES

0
4. Section 952.204-2 is revised to read as follows:


952.204-2  Security.

    As prescribed in 904.404(d)(1), the following clause shall be 
included in contracts entered into under section 31 (research 
assistance, 42 U.S.C. 2051), or section 41 (ownership and operation of 
production facilities, 42 U.S.C. 2061) of the Atomic Energy Act of 
1954, and in other contracts and subcontracts which involve or are 
likely to involve classified information or special nuclear material.

SECURITY (JUNE 2009)

    (a) Responsibility. It is the Contractor's duty to protect all 
classified information, special nuclear material, and other DOE 
property. The Contractor shall, in accordance with DOE security 
regulations and requirements, be responsible for protecting all 
classified information and all classified matter (including 
documents, material and special nuclear material) which are in the 
Contractor's possession in connection with the performance of work 
under this contract against sabotage, espionage, loss or theft. 
Except as otherwise expressly provided in this contract, the 
Contractor shall, upon completion or termination of this contract, 
transmit to DOE any classified matter or special nuclear material in 
the possession of the Contractor or any person under the 
Contractor's control in connection with performance of this 
contract. If retention by

[[Page 23125]]

the Contractor of any classified matter is required after the 
completion or termination of the contract, the Contractor shall 
identify the items and classification levels and categories of 
matter proposed for retention, the reasons for the retention, and 
the proposed period of retention. If the retention is approved by 
the Contracting Officer, the security provisions of the contract 
shall continue to be applicable to the classified matter retained. 
Special nuclear material shall not be retained after the completion 
or termination of the contract.
    (b) Regulations. The Contractor agrees to comply with all 
security regulations and contract requirements of DOE in effect on 
the date of award.
    (c) Definition of Classified Information. The term Classified 
Information means information that is classified as Restricted Data 
or Formerly Restricted Data under the Atomic Energy Act of 1954, or 
information determined to require protection against unauthorized 
disclosure under Executive Order 12958, Classified National Security 
Information, as amended, or prior executive orders, which is 
identified as National Security Information.
    (d) Definition of Restricted Data. The term Restricted Data 
means all data concerning design, manufacture, or utilization of 
atomic weapons; production of special nuclear material; or use of 
special nuclear material in the production of energy, but excluding 
data declassified or removed from the Restricted Data category 
pursuant to 42 U.S.C. 2162 [Section 142, as amended, of the Atomic 
Energy Act of 1954].
    (e) Definition of Formerly Restricted Data. The term ''Formerly 
Restricted Data'' means information removed from the Restricted Data 
category based on a joint determination by DOE or its predecessor 
agencies and the Department of Defense that the information: (1) 
Relates primarily to the military utilization of atomic weapons; and 
(2) can be adequately protected as National Security Information. 
However, such information is subject to the same restrictions on 
transmission to other countries or regional defense organizations 
that apply to Restricted Data.
    (f) Definition of National Security Information. The term 
``National Security Information'' means information that has been 
determined, pursuant to Executive Order 12958, Classified National 
Security Information, as amended, or any predecessor order, to 
require protection against unauthorized disclosure, and that is 
marked to indicate its classified status when in documentary form.
    (g) Definition of Special Nuclear Material. The term ``special 
nuclear material'' means: (1) Plutonium, uranium enriched in the 
isotope 233 or in the isotope 235, and any other material which, 
pursuant to 42 U.S.C. 2071 [section 51 as amended, of the Atomic 
Energy Act of 1954] has been determined to be special nuclear 
material, but does not include source material; or (2) any material 
artificially enriched by any of the foregoing, but does not include 
source material.
    (h) Access authorizations of personnel. (1) The Contractor shall 
not permit any individual to have access to any classified 
information or special nuclear material, except in accordance with 
the Atomic Energy Act of 1954, and the DOE's regulations and 
contract requirements applicable to the particular level and 
category of classified information or particular category of special 
nuclear material to which access is required.
    (2) The Contractor must conduct a thorough review, as defined at 
48 CFR 904.401, of an uncleared applicant or uncleared employee, and 
must test the individual for illegal drugs, prior to selecting the 
individual for a position requiring a DOE access authorization.
    (i) A review must: Verify an uncleared applicant's or uncleared 
employee's educational background, including any high school diploma 
obtained within the past five years, and degrees or diplomas granted 
by an institution of higher learning; contact listed employers for 
the last three years and listed personal references; conduct local 
law enforcement checks when such checks are not prohibited by state 
or local law or regulation and when the uncleared applicant or 
uncleared employee resides in the jurisdiction where the Contractor 
is located; and conduct a credit check and other checks as 
appropriate.
    (ii) Contractor reviews are not required for an applicant for 
DOE access authorization who possesses a current access 
authorization from DOE or another Federal agency, or whose access 
authorization may be reapproved without a federal background 
investigation pursuant to Executive Order 12968, Access to 
Classified Information (August 4, 1995), Sections 3.3(c) and (d).
    (iii) In collecting and using this information to make a 
determination as to whether it is appropriate to select an uncleared 
applicant or uncleared employee to a position requiring an access 
authorization, the Contractor must comply with all applicable laws, 
regulations, and Executive Orders, including those: (A) Governing 
the processing and privacy of an individual's information, such as 
the Fair Credit Reporting Act, Americans with Disabilities Act 
(ADA), and Health Insurance Portability and Accountability Act; and 
(B) prohibiting discrimination in employment, such as under the ADA, 
Title VII and the Age Discrimination in Employment Act, including 
with respect to pre- and post-offer of employment disability related 
questioning.
    (iv) In addition to a review, each candidate for a DOE access 
authorization must be tested to demonstrate the absence of any 
illegal drug, as defined in 10 CFR Part 707.4. All positions 
requiring access authorizations are deemed testing designated 
positions in accordance with 10 CFR Part 707. All employees 
possessing access authorizations are subject to applicant, random or 
for cause testing for use of illegal drugs. DOE will not process 
candidates for a DOE access authorization unless their tests confirm 
the absence from their system of any illegal drug.
    (v) When an uncleared applicant or uncleared employee receives 
an offer of employment for a position that requires a DOE access 
authorization, the Contractor shall not place that individual in 
such a position prior to the individual's receipt of a DOE access 
authorization, unless an approval has been obtained from the head of 
the cognizant local security office. If the individual is hired and 
placed in the position prior to receiving an access authorization, 
the uncleared employee may not be afforded access to classified 
information or matter or special nuclear material (in categories 
requiring access authorization) until an access authorization has 
been granted.
    (vi) The Contractor must furnish to the head of the cognizant 
local DOE Security Office, in writing, the following information 
concerning each uncleared applicant or uncleared employee who is 
selected for a position requiring an access authorization:
    (A) The date(s) each Review was conducted;
    (B) Each entity that provided information concerning the 
individual;
    (C) A certification that the review was conducted in accordance 
with all applicable laws, regulations, and Executive Orders, 
including those governing the processing and privacy of an 
individual's information collected during the review;
    (D) A certification that all information collected during the 
review was reviewed and evaluated in accordance with the 
Contractor's personnel policies; and
    (E) The results of the test for illegal drugs.
    (i) Criminal liability. It is understood that disclosure of any 
classified information relating to the work or services ordered 
hereunder to any person not entitled to receive it, or failure to 
protect any classified information, special nuclear material, or 
other Government property that may come to the Contractor or any 
person under the Contractor's control in connection with work under 
this contract, may subject the Contractor, its agents, employees, or 
Subcontractors to criminal liability under the laws of the United 
States (see the Atomic Energy Act of 1954, 42 U.S.C. 2011 et seq.; 
18 U.S.C. 793 and 794).
    (j) Foreign Ownership, Control, or Influence. (1) The Contractor 
shall immediately provide the cognizant security office written 
notice of any change in the extent and nature of foreign ownership, 
control or influence over the Contractor which would affect any 
answer to the questions presented in the Standard Form (SF) 328, 
Certificate Pertaining to Foreign Interests, executed prior to award 
of this contract. In addition, any notice of changes in ownership or 
control which are required to be reported to the Securities and 
Exchange Commission, the Federal Trade Commission, or the Department 
of Justice, shall also be furnished concurrently to the Contracting 
Officer.
    (2) If a Contractor has changes involving foreign ownership, 
control, or influence, DOE must determine whether the changes will 
pose an undue risk to the common defense and security. In making 
this determination, DOE will consider proposals made by the 
Contractor to avoid or mitigate foreign influences.
    (3) If the cognizant security office at any time determines that 
the Contractor is, or is potentially, subject to foreign ownership, 
control, or influence, the Contractor shall comply with such 
instructions as the Contracting Officer shall provide in writing

[[Page 23126]]

to protect any classified information or special nuclear material.
    (4) The Contracting Officer may terminate this contract for 
default either if the Contractor fails to meet obligations imposed 
by this clause or if the Contractor creates a foreign ownership, 
control, or influence situation in order to avoid performance or a 
termination for default. The Contracting Officer may terminate this 
contract for convenience if the Contractor becomes subject to 
foreign ownership, control, or influence and for reasons other than 
avoidance of performance of the contract, cannot, or chooses not to, 
avoid or mitigate the foreign ownership, control, or influence 
problem.
    (k) Employment announcements. When placing announcements seeking 
applicants for positions requiring access authorizations, the 
Contractor shall include in the written vacancy announcement, a 
notification to prospective applicants that reviews, and tests for 
the absence of any illegal drug as defined in 10 CFR 707.4, will be 
conducted by the employer and a background investigation by the 
Federal government may be required to obtain an access authorization 
prior to employment, and that subsequent reinvestigations may be 
required. If the position is covered by the Counterintelligence 
Evaluation Program regulations at 10 CFR Part 709, the announcement 
should also alert applicants that successful completion of a 
counterintelligence evaluation may include a counterintelligence-
scope polygraph examination.
    (l) Flow down to subcontracts. The Contractor agrees to insert 
terms that conform substantially to the language of this clause, 
including this paragraph, in all subcontracts under its contract 
that will require Subcontractor employees to possess access 
authorizations. Additionally, the Contractor must require such 
Subcontractors to have an existing DOD or DOE facility clearance or 
submit a completed SF 328, Certificate Pertaining to Foreign 
Interests, as required in DEAR 952.204-73 and obtain a foreign 
ownership, control and influence determination and facility 
clearance prior to award of a subcontract. Information to be 
provided by a Subcontractor pursuant to this clause may be submitted 
directly to the Contracting Officer. For purposes of this clause, 
Subcontractor means any Subcontractor at any tier and the term 
``Contracting Officer'' means the DOE Contracting Officer. When this 
clause is included in a subcontract, the term ``Contractor'' shall 
mean Subcontractor and the term ``contract'' shall mean subcontract.


(End of Clause)

PART 970--DOE MANAGEMENT AND OPERATING CONTRACTS

0
5. The authority citation for part 970 continues to read as follows:

    Authority: 42 U.S.C. 2201, 2282a, 2282b, 2282c; 42 U.S.C. 7101 
et seq.; 41 U.S.C. 418b; 50 U.S.C. 2401 et seq.


970.0470-1  [Amended]

0
6. Section 970.0470-1(b) is amended by revising both mentions of 
``Directives System'' to read ``Directives Program.''


970.2201-1  [Amended]

0
7. Section 970.2201-1-1 is amended by removing the term ``guidance'' 
and adding in its place ``requirements.''

0
8. In section 970.2201-1-2, paragraphs (a)(1)(i), (ii) and (iii) are 
revised and paragraphs (a)(1)(iv), (v) and (vi) are added to read as 
follows:


970.2201-1-2  Policies.

    (a)(1) * * *
    (i) Management and operating contractors are expected to bring 
experienced, proven personnel from their private operations to staff 
key positions on the contract and to recruit other well-qualified 
personnel as needed. Such personnel should be employed and treated 
during employment without discrimination by reason of race, color, 
religion, sex, age, disability, or national origin. Contractors shall 
be required to take affirmative action to achieve these objectives.
    (ii) The Contractor must conduct a thorough review, as defined at 
48 CFR 904.401, of an uncleared applicant's or uncleared employee's 
background, and test the individual for illegal drugs, as part of its 
determination to select that individual for a position requiring a DOE 
access authorization.
    (A) A review must: Verify an uncleared applicant's or uncleared 
employee's educational background, including any high school diploma 
obtained within the past five years, and degrees or diplomas granted by 
an institution of higher learning; contact listed employers for the 
last three years and listed personal references; conduct local law 
enforcement checks when such checks are not prohibited by state or 
local law or regulation and when the uncleared applicant or uncleared 
employee resides in the jurisdiction where the contractor is located; 
and conduct a credit check and other checks as appropriate.
    (B) Contractor reviews are not required for an applicant for DOE 
access authorization who possesses a current access authorization from 
DOE or another federal agency, or whose access authorization may be 
reapproved without a federal background investigation pursuant to 
Executive Order 12968, Access to Classified Information (August 4, 
1995), Sections 3.3(c) and (d).
    (C) In collecting and using this information to make a 
determination as to whether it is appropriate to select an uncleared 
applicant or uncleared employee for a position requiring an access 
authorization, the contractor must comply with all applicable laws, 
regulations, and Executive Orders, including those:
    (1) Governing the processing and privacy of an individual's 
information by employers, such as the Fair Credit Reporting Act, 
Americans with Disabilities Act (ADA), and Health Insurance Portability 
and Accountability Act; and
    (2) Prohibiting discrimination in employment, such as under the 
ADA, Title VII and the Age Discrimination in Employment Act, including 
with respect to pre- and post-offer of employment disability related 
questioning.
    (iii) In addition to a review, each candidate for a DOE access 
authorization must be tested to demonstrate the absence of any illegal 
drug, as defined in 10 CFR Part 707.4. All positions requiring access 
authorizations are deemed testing designated positions in accordance 
with 10 CFR Part 707. All employees possessing access authorizations 
are subject to applicant, random or for cause testing for use of 
illegal drugs. DOE will not process candidates for a DOE access 
authorization unless their tests confirm the absence of any illegal 
drug.
    (iv) When an uncleared applicant or uncleared employee is hired 
specifically for a position that requires a DOE access authorization, 
the contractor shall not place that individual in that position prior 
to the access authorization being granted by DOE, unless an approval 
has been obtained from the contracting officer, acting in consultation 
for these purposes with the head of the cognizant local security 
office. If an uncleared employee is placed in that position prior to an 
access authorization being granted by the contracting officer, the 
uncleared employee may not be afforded access to classified information 
or matter or special nuclear material (in categories requiring access 
authorization) until the contracting officer notifies the employer that 
an access authorization has been granted.
    (v)(A) The contractor must furnish to the head of the cognizant 
local DOE Security Office, in writing, the following information 
concerning each uncleared applicant or uncleared employee who is 
selected for a position requiring an access authorization:
    (1) The date(s) each review was conducted;

[[Page 23127]]

    (2) Each entity contacted that provided information concerning the 
individual;
    (3) A certification that the review was conducted in accordance 
with all applicable laws, regulations, and Executive Orders, including 
those governing the processing and privacy of an individual's 
information collected during the review;
    (4) A certification that all information collected during the 
review was reviewed and evaluated in accordance with the contractor's 
personnel policies; and
    (5) The results of the test for illegal drugs.
    When a DOE access authorization will be required, the 
aforementioned review must be conducted and the required information 
forwarded to DOE before a request is made to DOE to process the 
individual for an access authorization.
    (vi) Management and operating contractors and other contractors 
operating DOE facilities shall include the requirements set forth in 
this subsection in subcontracts (appropriately modified to identify the 
parties) wherein subcontract employees will be required to hold DOE 
access authorizations in order to perform on-site duties, such as 
protective force operations.
* * * * *
[FR Doc. E9-11522 Filed 5-15-09; 8:45 am]
BILLING CODE 6450-01-P


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