Defense Federal Acquisition Regulation Supplement (DFARS); Continuation of Essential Contractor Services (DFARS Case 2009-D017), 66680-66683 [2010-27302]

Download as PDF 66680 Federal Register / Vol. 75, No. 209 / Friday, October 29, 2010 / Rules and Regulations I. Background DEPARTMENT OF DEFENSE IV. Paperwork Reduction Act DFARS 209.405–1 limits placement of orders against contracts with contractors that have been debarred, suspended, or proposed for debarment. On December 11, 2003, the final rule published under FAR Case 2002–010 (68 FR 69250) incorporated these restrictions into the FAR. The DFARS text, therefore, became redundant and is deleted by this final rule. Defense Acquisitions Regulations System This final rule affects the certification and information collection requirements in the provisions at DFARS 252.225– 7020 and 252.225–7035, currently approved under Office of Management and Budget Control Number 0704–0229. However, there is no impact on the estimated burden hours. The dollar threshold changes are in line with inflation and maintain the status quo. II. Executive Order 12866 This is not a significant regulatory action and, therefore, was not subject to Office of Management and Budget review under section 6(b) of Executive Order 12866, dated September 30, 1993. This rule is not a major rule under 5 U.S.C. 804. III. Regulatory Flexibility Act The Regulatory Flexibility Act does not apply to this rule. This final rule does not constitute a significant DFARS revision within the meaning of 41 U.S.C. 418b and FAR 1.501, and publication for public comment is not required. However, DoD will consider comments from small entities concerning the affected DFARS parts in accordance with 5 U.S.C. 610. Interested parties must submit such comments separately and should cite 5 U.S.C. 601, et seq., in correspondence. IV. Paperwork Reduction Act This rule does not impose any new information collection requirements that require the approval of the Office of Management and Budget under 44 U.S.C. 3501, et seq. List of Subjects in 48 CFR Part 209 Government procurement. Ynette R. Shelkin, Editor, Defense Acquisition Regulations System. Therefore, 48 CFR part 209 is amended as follows: ■ PART 209—CONTRACTOR QUALIFICATIONS 1. The authority citation for 48 CFR part 209 continues to read as follows: WReier-Aviles on DSKGBLS3C1PROD with RULES Authority: 41 U.S.C. 421 and 48 CFR chapter 1. ■ [Removed] 2. Remove section 209.405–1. [FR Doc. 2010–27306 Filed 10–28–10; 8:45 am] BILLING CODE 5001–08–P VerDate Mar<15>2010 13:56 Oct 28, 2010 RIN 0750–AG59 Defense Federal Acquisition Regulation Supplement; Trade Agreements—New Thresholds (DFARS 2009–D040) Jkt 223001 List of Subjects in 48 CFR Part 225 Government procurement. Defense Acquisition Regulations System, Department of Defense (DoD). AGENCY: ACTION: Ynette R. Shelkin, Editor, Defense Acquisition Regulations System. Final rule. DoD is adopting as final, without change, the interim rule that amended the Defense Federal Acquisition Regulation Supplement (DFARS) to incorporate increased thresholds for application of the World Trade Organization Government Procurement Agreement and the Free Trade Agreements, as determined by the United States Trade Representative. SUMMARY: DATES: Effective Date: October 29, 2010. FOR FURTHER INFORMATION CONTACT: Ms. Amy Williams, 703–602–0328. Interim Rule Adopted as Final Without Change Accordingly, the interim rule amending 48 CFR part 225 published at 75 FR 32637 on June 8, 2010, is adopted as final without change. ■ [FR Doc. 2010–27303 Filed 10–28–10; 8:45 am] BILLING CODE 5001–08–P DEPARTMENT OF DEFENSE Defense Acquisition Regulations System SUPPLEMENTARY INFORMATION: I. Background 48 CFR Parts 237 and 252 DoD published an interim rule in the Federal Register on June 8, 2010 (75 FR 32637) to amend the clause prescriptions at DFARS 225.1101 and 225.7503 to reflect increased thresholds for application of the trade agreements. The comment period closed on August 9, 2010. DoD received no comments on the interim rule. DoD has therefore adopted the interim rule as a final rule without change. RIN 0750–AG52 II. Executive Order 12866 DoD certifies that this final rule will not have a significant economic impact on a substantial number of small entities within the meaning of the Regulatory Flexibility Act, 5 U.S.C. 601, et seq., because this rule does not impose economic burdens on contractors. The purpose and effect of this rule is to adjust the dollar threshold changes to keep pace with inflation and thus maintain the status quo. PO 00000 Frm 00038 Fmt 4700 Sfmt 4700 Defense Federal Acquisition Regulation Supplement (DFARS); Continuation of Essential Contractor Services (DFARS Case 2009–D017) Defense Acquisition Regulations System, Department of Defense (DoD). ACTION: Final rule. AGENCY: DoD is adopting as final, with changes, the interim rule amending the Defense Federal Acquisition Regulation Supplement (DFARS) to add policy and a contract clause requiring that contractors providing essential contractor services, as determined by the requiring activity, shall be prepared to continue such services during periods of crisis. DATES: Effective date: October 29, 2010. Applicability date: Contracting officers may, at their discretion, include these changes in any existing contract with appropriate consideration, in accordance with FAR 1.108(d)(3). FOR FURTHER INFORMATION CONTACT: Mr. Julian E. Thrash, 703–602–0310. SUPPLEMENTARY INFORMATION: SUMMARY: This rule was not subject to Office of Management and Budget review under Executive Order 12866, Regulatory Planning and Review, dated September 30, 1993. This rule is not a major rule under 5 U.S.C. 804. III. Regulatory Flexibility Act ■ 209.405–1 48 CFR Part 225 E:\FR\FM\29OCR1.SGM 29OCR1 Federal Register / Vol. 75, No. 209 / Friday, October 29, 2010 / Rules and Regulations I. Background DoD published an interim rule in the Federal Register at 75 FR 10191, on March 5, 2010, implementing the requirements of DoDI 3020.37, Continuation of Essential DoD Contractor Services During Crises. DoD Instruction (DoDI) 1100.22, Policy and Procedures for Determining Workforce Mix, has since superseded DoDI 3020.37. This rule is necessary to ensure that essential contractor services are not interrupted. The current changing threat environment, particularly under the additional challenges caused by such potential crises as destructive weather, earthquakes, or pandemic disease, has increased the need for continuity of operations capabilities and plans that enable agencies to continue their essential functions during a broad range of emergencies and crises. DoD established this requirement for contractors to submit their plans to ensure continuation of essential contractor services that support mission-essential functions during a crisis situation. As a general rule, the designation of services as essential contractor services will not apply to an entire contract but will apply only to those service function(s) that have been specifically identified as essential contractor services by the functional commander or civilian equivalent. The public comment period for the DFARS interim rule closed May 4, 2010. Two respondents submitted comments to the interim rule. A discussion of the comments and the changes made to the rule as a result of those comments is provided below. II. Analysis of Public Comments WReier-Aviles on DSKGBLS3C1PROD with RULES 1. Definition of ‘‘Functional Commander or Equivalent’’ Comment. A respondent requested the term ‘‘functional commander or equivalent’’ be defined. The respondent was concerned with how this term would be interpreted in non-military offices that did not have a ‘‘functional commander or equivalent.’’ Response. The term ‘‘functional commander or equivalent’’ has been revised. The term appropriate ‘‘functional commander or civilian equivalent’’ clarifies the meaning of the phrase ‘‘or equivalent.’’ This revised identifier, ‘‘civilian equivalent,’’ was added to the definitions of ‘‘essential contractor services,’’ and ‘‘missionessential functions.’’ Additionally, conforming changes to DFARS 237.7602(a), and 237.7602(b) were made for this revised term. 13:56 Oct 28, 2010 Jkt 223001 Comment. A respondent requested a definition for a ‘‘crisis’’ be added to the text. Response. A crisis situation is dynamic, with the body of knowledge growing hour-by-hour from the latest situational reports. As such, it does not lend itself to a precise definition. The contractor will be notified to activate plans for a crisis by the contracting officer, who does so at the directions of the appropriate functional commander or civilian equivalent. B. The Contracting Officer’s Role Comment. A respondent was concerned that DFARS 237.7602, Policy, did not clearly lay out the role of a contracting officer in the process of requiring a contractor to submit a plan. The concern was that direction to the contractor should come from the contracting officer, not the requiring activity. Response. DFARS 237.7602, Policy, has been revised at paragraphs (a) and (b) to clarify that it is the role of the contracting officer, not the requiring activity, to provide direction to the contractor. C. Written Plan 1. Status of the Plan Comment. A respondent expressed concern regarding DFARS 237.7602(b), whether the contractor should ‘‘have a plan’’ or ‘‘submit a plan.’’ Response. DFARS 237.7602(b) has been revised to require contractors to ‘‘provide a written plan’’ for Government-determined essential contractor services. 2. Materially Altered Plans A. Definitions VerDate Mar<15>2010 2. Definition of a ‘‘ Crisis’’ Comment. A respondent expressed concern that a contracting officer needs to have the most current version of the contractor’s plan. The concern centered on the determination of whether a change would ‘‘materially alter’’ the plan. Response. DFARS 252.237–7023(c)(2) has been revised to require the contractor to provide all plan updates to the contracting officer for approval. 3. Use of a Plan Comment. A respondent expressed a number of concerns about the evaluation of a contractor’s written plan, and whether or not the plan should be evaluated prior to contract award. Response. In response to this concern, a provision has been created at DFARS 252.237–7024, Notice of Continuation of Essential Contractor Services, to require the submission of the plan as part of the PO 00000 Frm 00039 Fmt 4700 Sfmt 4700 66681 offeror’s proposal. The associate provision prescription is added at 237.7603. The contractor’s continuity of essential services plan shall be considered and evaluated as part of the technical evaluation of offers. The functional managers of the services should be consulted to determine the sufficiency of these plans. The contractor’s Mission-Essential Contractor Services Plan, in the resultant contract, will remain active in accordance with the clause at DFARS 252.237–7023, Continuation of Essential Contractor Services. D. Equitable Adjustment Comment. A respondent stated that, if costs increase due to the continuation of services during an event that would create an excusable delay, contractors should be entitled to an equitable adjustment to the terms of the contract. Furthermore, they were concerned that inclusion of the clause in a contract could be construed as waiving the contractor’s right to an equitable adjustment to contract terms other than schedule terms when providing its best efforts to maintain continuity of operations during a crisis. Response. DFARS 252.237–7023(f), Changes, provides the basis for determining an equitable adjustment. In the interim rule, this paragraph allowed for an equitable adjustment to contract price. In the final rule, this paragraph has been revised to include that, in addition to an adjustment in price, an equitable adjustment may be to ‘‘delivery schedule, or both.’’ E. Causes Beyond the Control of the Contractor Comment. Two respondents requested the clause at DFARS 252.237–7023(c) be clarified with regard to causes beyond the control of the contractor. Response. As a result of the necessity to ensure performance of a missionessential function, a new paragraph has been added at DFARS 252.237– 7023(d)(1). This paragraph clarifies that, in those specific instances where a contractor function is considered mission essential, it is important for contract performance to continue notwithstanding any other clause of the contract; and that the contractor shall be responsible to perform those services identified as essential contractor services during crisis situations (as directed by the contracting officer), in accordance with its Mission-Essential Contractor Services Plan. If in the course of contract performance, a contractor feels it must apply for an equitable adjustment, it may follow the E:\FR\FM\29OCR1.SGM 29OCR1 66682 Federal Register / Vol. 75, No. 209 / Friday, October 29, 2010 / Rules and Regulations process required in DFARS 252.237– 7023(f), Changes. F. Other Changes • The definitions have been moved from 237.7601 to the clause 252.237– 7023(a). • DFARS 252.237–7023 has been renamed ‘‘Continuation of Essential Contractor Services’’ instead of ‘‘Continuation of Mission-Essential Functions’’ in order to use more precise terminology. • Redesignated DFARS 252.237– 7023(e) adds ‘‘military’’ personnel to the list of options the Government reserves the right to utilize in crisis situations. Additionally, reference to the Office of Federal Procurement Policy letter dated May 2007, and FAR and DFARS parts 18 and 218 were determined unnecessary and have been deleted from that paragraph. III. Executive Order 12866 This regulatory action was subject to review under Section 6(b) of Executive Order 12866, Regulatory Planning and Review, dated September 30, 1993. This rule is not a major rule under 5 U.S.C. 804. IV. Regulatory Flexibility Act DoD certifies that this rule will not have a significant economic impact upon a substantial number of small entities because it allows for an equitable adjustment for additional costs that are incurred during a crisis situation. The interim rule published at 75 FR 10191, on March 5, 2010, invited comments from small businesses and other interested parties. No comments were received from small entities on the affected DFARS subpart with regard to small businesses. WReier-Aviles on DSKGBLS3C1PROD with RULES V. Paperwork Reduction Act This final rule contains an information collection requirement. The Office of Management and Budget (OMB) has approved the information collection requirement for use through December 31, 2010, under OMB Control Number 0704–0465, in accordance with the emergency processing procedures of 5 CFR 1320.13. The following is a summary of the information collection requirement. Title: Defense Federal Acquisition Regulation Supplement (DFARS) 2009– D017; Continuation of Essential Contractor Services. Type of Request: New collection. Number of Respondents: 7,600. Responses per Respondents: 1.25. Annual Responses: 9,500. Average Burden per Response: 2. VerDate Mar<15>2010 13:56 Oct 28, 2010 Jkt 223001 Total Annual Burden Hours: 19,000. Needs and Uses: DoD needs this information to ensure essential contractor services are performed for continuity of operations. Affected Public: Businesses or other for-profit institutions. Frequency: On occasion. Respondent’s Obligation: Required to obtain contract. The interim rule, published at 75 FR 10191, on March 5, 2010, invited comments on the following aspects of the interim rule: (a) Whether the collection of information is necessary for the proper performance of the functions of DoD, including whether the information will have practical utility; (b) the accuracy of the estimate of the burden of the information collection; (c) ways to enhance the quality, utility, and clarity of the information to be collected; and (d) ways to minimize the burden of the information collection on respondents, including the use of automated collection techniques or other forms of information technology. No comments were received regarding this information collection requirement. To request more information on this information collection or to obtain a copy of the information collection requirement and associated collection instruments, please write to the Defense Acquisition Regulations System (DARS), Attn: Mr. Julian Thrash, OUSD(AT&L)DPAP(DARS), Room 3B855, 3060 Defense Pentagon, Washington, DC 20301–3060. List of Subjects in 48 CFR Parts 237 and 252 Government procurement. Clare M. Zebrowski, Editor, Defense Acquisition Regulations System. Therefore, the Defense Acquisition Regulations System confirms as final the interim rule published at 75 FR 10191, March 5, 2010, with the following changes: ■ 1. The authority citation for 48 CFR parts 237 and 252 continues to read as follows: ■ Authority: 41 U.S.C. 421 and 48 CFR chapter 1. PART 237—SERVICE CONTRACTING 2. Subpart 237.76 is revised to read as follows: ■ Subpart 237.76—Continuation of Essential Contractor Services Sec. 237.7600 Scope. 237.7601 Definitions. 237.7602 Policy. 237.7603 Solicitation provision and contract clause. PO 00000 Frm 00040 Fmt 4700 Sfmt 4700 Subpart 237.76—Continuation of Essential Contractor Services 237.7600 Scope. This subpart prescribes procedures for the acquisition of essential contractor services which support missionessential functions. 237.7601 Definitions. As used in this subpart, essential contractor service and mission-essential functions are defined in the clause at 252.237–7023, Continuation of Essential Contractor Services. 237.7602 Policy. (a) Contractors providing services designated as essential contractor services shall be prepared to continue providing such services, in accordance with the terms and conditions of their contracts, during periods of crisis. As a general rule, the designation of services as essential contractor services will not apply to an entire contract but will apply only to those service functions that have been specifically identified as essential contractor services by the functional commander or civilian equivalent. (b) Contractors who provide Government-determined essential contractor services shall provide a written plan to be incorporated in the contract, to ensure the continuation of these services in crisis situations. Contracting officers shall consult with a functional manager to assess the sufficiency of the contractor-provided written plan. Contractors will activate such plans only during periods of crisis, as authorized by the contracting officer, who does so at the direction of the appropriate functional commander or civilian equivalent. (c) The contracting officer shall follow the procedures at PGI 207.105U(b)(20)(C) in preparing an acquisition plan. 237.7603 Solicitation provision and contract clause. (a) Use the clause at 252.237–7023, Continuation of Essential Contractor Services in all solicitations and contracts for services that are in support of mission-essential functions. (b) Use the provision at 252.237–7024, Notice of Continuation of Essential Contractor Services in all solicitations for services that include the clause 252.237–7023. PART 252—SOLICITATION PROVISIONS AND CONTRACT CLAUSES 3. Section 252.237–7023 is revised to read as follows: ■ E:\FR\FM\29OCR1.SGM 29OCR1 Federal Register / Vol. 75, No. 209 / Friday, October 29, 2010 / Rules and Regulations 252.237–7023 Continuation of Essential Contractor Services. As prescribed in 237.7603(a), use the following clause: WReier-Aviles on DSKGBLS3C1PROD with RULES CONTINUATION OF ESSENTIAL CONTRACTOR SERVICES (OCT 2010) (a) Definitions. As used in this clause– (1) Essential contractor service means a service provided by a firm or individual under contract to DoD to support missionessential functions, such as support of vital systems, including ships owned, leased, or operated in support of military missions or roles at sea; associated support activities, including installation, garrison, and base support services; and similar services provided to foreign military sales customers under the Security Assistance Program. Services are essential if the effectiveness of defense systems or operations has the potential to be seriously impaired by the interruption of these services, as determined by the appropriate functional commander or civilian equivalent. (2) Mission-essential functions means those organizational activities that must be performed under all circumstances to achieve DoD component missions or responsibilities, as determined by the appropriate functional commander or civilian equivalent. Failure to perform or sustain these functions would significantly affect DoD’s ability to provide vital services or exercise authority, direction, and control. (b) The Government has identified all or a portion of the contractor services performed under this contract as essential contractor services in support of mission-essential functions. These services are listed in attachment l, Mission-Essential Contractor Services, dated llll. (c)(1) The Mission-Essential Contractor Services Plan submitted by the Contractor, is incorporated in this contract. (2) The Contractor shall maintain and update its plan as necessary. The Contractor shall provide all plan updates to the Contracting Officer for approval. (3) As directed by the Contracting Officer, the Contractor shall participate in training events, exercises, and drills associated with Government efforts to test the effectiveness of continuity of operations procedures and practices. (d)(1) Notwithstanding any other clause of this contract, the Contractor shall be responsible to perform those services identified as essential contractor services during crisis situations (as directed by the Contracting Officer), in accordance with its Mission-Essential Contractor Services Plan. (2) In the event the Contractor anticipates not being able to perform any of the essential contractor services identified in accordance with paragraph (b) of this clause during a crisis situation, the Contractor shall notify the Contracting Officer or other designated representative as expeditiously as possible and use its best efforts to cooperate with the Government in the Government’s efforts to maintain the continuity of operations. (e) The Government reserves the right in such crisis situations to use Federal employees, military personnel, or contract VerDate Mar<15>2010 13:56 Oct 28, 2010 Jkt 223001 support from other contractors, or to enter into new contracts for essential contractor services. (f) Changes. The Contractor shall segregate and separately identify all costs incurred in continuing performance of essential services in a crisis situation. The Contractor shall notify the Contracting Officer of an increase or decrease in costs within ninety days after continued performance has been directed by the Contracting Officer, or within any additional period that the Contracting Officer approves in writing, but not later than the date of final payment under the contract. The Contractor’s notice shall include the Contractor’s proposal for an equitable adjustment and any data supporting the increase or decrease in the form prescribed by the Contracting Officer. The parties shall negotiate an equitable price adjustment to the contract price, delivery schedule, or both as soon as is practicable after receipt of the Contractor’s proposal. (g) The Contractor shall include the substance of this clause, including this paragraph (g), in subcontracts for the essential services. (End of clause) ■ 4. Section 252.237–7024 is added to read as follows: 252.237–7024 Notice of Continuation of Essential Contractor Services. As prescribed in 237.7603(b), use the following provision: NOTICE OF CONTINUATION OF ESSENTIAL CONTRACTOR SERVICES [OCT 2010] (a) Definitions. Essential contractor service and mission-essential functions have the meanings given in the clause at 252.237– 7023, Continuation of Essential Contractor Services, in this solicitation. (b) The offeror shall provide with its offer a written plan describing how it will continue to perform the essential contractor services listed in attachment l, Mission Essential Contractor Services, dated llll, during periods of crisis. The offeror shall— (1) Identify provisions made for the acquisition of essential personnel and resources, if necessary, for continuity of operations for up to 30 days or until normal operations can be resumed; (2) Address in the plan, at a minimum— (i) Challenges associated with maintaining essential contractor services during an extended event, such as a pandemic that occurs in repeated waves; (ii) The time lapse associated with the initiation of the acquisition of essential personnel and resources and their actual availability on site; (iii) The components, processes, and requirements for the identification, training, and preparedness of personnel who are capable of relocating to alternate facilities or performing work from home; (iv) Any established alert and notification procedures for mobilizing identified ‘‘essential contractor service’’ personnel; and (v) The approach for communicating expectations to contractor employees PO 00000 Frm 00041 Fmt 4700 Sfmt 4700 66683 regarding their roles and responsibilities during a crisis. (End of provision) [FR Doc. 2010–27302 Filed 10–28–10; 8:45 am] BILLING CODE 5001–08–P DEPARTMENT OF DEFENSE Defense Acquisition Regulations System 48 CFR Parts 246 and 252 RIN 0750–AG73 Defense Federal Acquisition Regulation Supplement; Safety of Facilities, Infrastructure, and Equipment for Military Operations (DFARS Case 2009–D029) Defense Acquisition Regulations System, Department of Defense (DoD). ACTION: Interim rule with request for comments. AGENCY: DoD is issuing an interim rule amending the Defense Federal Acquisition Regulation Supplement (DFARS) to implement section 807 of the National Defense Authorization Act of 2010. Section 807 requires that facilities, infrastructure, and equipment that are intended for use by military or civilian personnel of the Department of Defense (DoD), in current or future military operations, should be inspected for safety and habitability prior to use, and that such facilities should be brought into compliance with generally accepted standards for the safety and health of personnel to the maximum extent practicable consistent with the requirements of military operations and the best interests of DoD to minimize the safety and health risk posed to such personnel. DATES: Effective date: October 29, 2010. Comment date: Comments on the interim rule should be submitted in writing to the address shown below on or before December 28, 2010, to be considered in the formation of the final rule. ADDRESSES: Submit comments, identified by DFARS Case 2008–D029, using any of the following methods: Regulations.gov: http:// www.regulations.gov. Submit comments via the Federal eRulemaking portal by inputting ‘‘DFARS Case 2009–D029’’ under the heading ‘‘Enter keyword or ID’’ and selecting ‘‘Search.’’ Select the link ‘‘Submit a Comment’’ that corresponds with ‘‘DFARS Case 2009–D029.’’ Follow the instructions provided at the ‘‘Submit SUMMARY: E:\FR\FM\29OCR1.SGM 29OCR1

Agencies

[Federal Register Volume 75, Number 209 (Friday, October 29, 2010)]
[Rules and Regulations]
[Pages 66680-66683]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2010-27302]


-----------------------------------------------------------------------

DEPARTMENT OF DEFENSE

Defense Acquisition Regulations System

48 CFR Parts 237 and 252

RIN 0750-AG52


Defense Federal Acquisition Regulation Supplement (DFARS); 
Continuation of Essential Contractor Services (DFARS Case 2009-D017)

AGENCY: Defense Acquisition Regulations System, Department of Defense 
(DoD).

ACTION: Final rule.

-----------------------------------------------------------------------

SUMMARY: DoD is adopting as final, with changes, the interim rule 
amending the Defense Federal Acquisition Regulation Supplement (DFARS) 
to add policy and a contract clause requiring that contractors 
providing essential contractor services, as determined by the requiring 
activity, shall be prepared to continue such services during periods of 
crisis.

DATES: Effective date: October 29, 2010.
    Applicability date: Contracting officers may, at their discretion, 
include these changes in any existing contract with appropriate 
consideration, in accordance with FAR 1.108(d)(3).

FOR FURTHER INFORMATION CONTACT: Mr. Julian E. Thrash, 703-602-0310.

SUPPLEMENTARY INFORMATION:

[[Page 66681]]

I. Background

    DoD published an interim rule in the Federal Register at 75 FR 
10191, on March 5, 2010, implementing the requirements of DoDI 3020.37, 
Continuation of Essential DoD Contractor Services During Crises. DoD 
Instruction (DoDI) 1100.22, Policy and Procedures for Determining 
Workforce Mix, has since superseded DoDI 3020.37.
    This rule is necessary to ensure that essential contractor services 
are not interrupted. The current changing threat environment, 
particularly under the additional challenges caused by such potential 
crises as destructive weather, earthquakes, or pandemic disease, has 
increased the need for continuity of operations capabilities and plans 
that enable agencies to continue their essential functions during a 
broad range of emergencies and crises.
    DoD established this requirement for contractors to submit their 
plans to ensure continuation of essential contractor services that 
support mission-essential functions during a crisis situation. As a 
general rule, the designation of services as essential contractor 
services will not apply to an entire contract but will apply only to 
those service function(s) that have been specifically identified as 
essential contractor services by the functional commander or civilian 
equivalent.
    The public comment period for the DFARS interim rule closed May 4, 
2010. Two respondents submitted comments to the interim rule. A 
discussion of the comments and the changes made to the rule as a result 
of those comments is provided below.

II. Analysis of Public Comments

A. Definitions

1. Definition of ``Functional Commander or Equivalent''
    Comment. A respondent requested the term ``functional commander or 
equivalent'' be defined. The respondent was concerned with how this 
term would be interpreted in non-military offices that did not have a 
``functional commander or equivalent.''
    Response. The term ``functional commander or equivalent'' has been 
revised. The term appropriate ``functional commander or civilian 
equivalent'' clarifies the meaning of the phrase ``or equivalent.'' 
This revised identifier, ``civilian equivalent,'' was added to the 
definitions of ``essential contractor services,'' and ``mission-
essential functions.'' Additionally, conforming changes to DFARS 
237.7602(a), and 237.7602(b) were made for this revised term.
2. Definition of a `` Crisis''
    Comment. A respondent requested a definition for a ``crisis'' be 
added to the text.
    Response. A crisis situation is dynamic, with the body of knowledge 
growing hour-by-hour from the latest situational reports. As such, it 
does not lend itself to a precise definition. The contractor will be 
notified to activate plans for a crisis by the contracting officer, who 
does so at the directions of the appropriate functional commander or 
civilian equivalent.

B. The Contracting Officer's Role

    Comment. A respondent was concerned that DFARS 237.7602, Policy, 
did not clearly lay out the role of a contracting officer in the 
process of requiring a contractor to submit a plan. The concern was 
that direction to the contractor should come from the contracting 
officer, not the requiring activity.
    Response. DFARS 237.7602, Policy, has been revised at paragraphs 
(a) and (b) to clarify that it is the role of the contracting officer, 
not the requiring activity, to provide direction to the contractor.

C. Written Plan

1. Status of the Plan
    Comment. A respondent expressed concern regarding DFARS 
237.7602(b), whether the contractor should ``have a plan'' or ``submit 
a plan.''
    Response. DFARS 237.7602(b) has been revised to require contractors 
to ``provide a written plan'' for Government-determined essential 
contractor services.
2. Materially Altered Plans
    Comment. A respondent expressed concern that a contracting officer 
needs to have the most current version of the contractor's plan. The 
concern centered on the determination of whether a change would 
``materially alter'' the plan.
    Response. DFARS 252.237-7023(c)(2) has been revised to require the 
contractor to provide all plan updates to the contracting officer for 
approval.
3. Use of a Plan
    Comment. A respondent expressed a number of concerns about the 
evaluation of a contractor's written plan, and whether or not the plan 
should be evaluated prior to contract award.
    Response. In response to this concern, a provision has been created 
at DFARS 252.237-7024, Notice of Continuation of Essential Contractor 
Services, to require the submission of the plan as part of the 
offeror's proposal. The associate provision prescription is added at 
237.7603. The contractor's continuity of essential services plan shall 
be considered and evaluated as part of the technical evaluation of 
offers. The functional managers of the services should be consulted to 
determine the sufficiency of these plans. The contractor's Mission-
Essential Contractor Services Plan, in the resultant contract, will 
remain active in accordance with the clause at DFARS 252.237-7023, 
Continuation of Essential Contractor Services.

D. Equitable Adjustment

    Comment. A respondent stated that, if costs increase due to the 
continuation of services during an event that would create an excusable 
delay, contractors should be entitled to an equitable adjustment to the 
terms of the contract. Furthermore, they were concerned that inclusion 
of the clause in a contract could be construed as waiving the 
contractor's right to an equitable adjustment to contract terms other 
than schedule terms when providing its best efforts to maintain 
continuity of operations during a crisis.
    Response. DFARS 252.237-7023(f), Changes, provides the basis for 
determining an equitable adjustment. In the interim rule, this 
paragraph allowed for an equitable adjustment to contract price. In the 
final rule, this paragraph has been revised to include that, in 
addition to an adjustment in price, an equitable adjustment may be to 
``delivery schedule, or both.''

E. Causes Beyond the Control of the Contractor

    Comment. Two respondents requested the clause at DFARS 252.237-
7023(c) be clarified with regard to causes beyond the control of the 
contractor.
    Response. As a result of the necessity to ensure performance of a 
mission-essential function, a new paragraph has been added at DFARS 
252.237-7023(d)(1). This paragraph clarifies that, in those specific 
instances where a contractor function is considered mission essential, 
it is important for contract performance to continue notwithstanding 
any other clause of the contract; and that the contractor shall be 
responsible to perform those services identified as essential 
contractor services during crisis situations (as directed by the 
contracting officer), in accordance with its Mission-Essential 
Contractor Services Plan. If in the course of contract performance, a 
contractor feels it must apply for an equitable adjustment, it may 
follow the

[[Page 66682]]

process required in DFARS 252.237-7023(f), Changes.

F. Other Changes

     The definitions have been moved from 237.7601 to the 
clause 252.237-7023(a).
     DFARS 252.237-7023 has been renamed ``Continuation of 
Essential Contractor Services'' instead of ``Continuation of Mission-
Essential Functions'' in order to use more precise terminology.
     Redesignated DFARS 252.237-7023(e) adds ``military'' 
personnel to the list of options the Government reserves the right to 
utilize in crisis situations. Additionally, reference to the Office of 
Federal Procurement Policy letter dated May 2007, and FAR and DFARS 
parts 18 and 218 were determined unnecessary and have been deleted from 
that paragraph.

III. Executive Order 12866

    This regulatory action was subject to review under Section 6(b) of 
Executive Order 12866, Regulatory Planning and Review, dated September 
30, 1993. This rule is not a major rule under 5 U.S.C. 804.

IV. Regulatory Flexibility Act

    DoD certifies that this rule will not have a significant economic 
impact upon a substantial number of small entities because it allows 
for an equitable adjustment for additional costs that are incurred 
during a crisis situation.
    The interim rule published at 75 FR 10191, on March 5, 2010, 
invited comments from small businesses and other interested parties. No 
comments were received from small entities on the affected DFARS 
subpart with regard to small businesses.

V. Paperwork Reduction Act

    This final rule contains an information collection requirement. The 
Office of Management and Budget (OMB) has approved the information 
collection requirement for use through December 31, 2010, under OMB 
Control Number 0704-0465, in accordance with the emergency processing 
procedures of 5 CFR 1320.13.
    The following is a summary of the information collection 
requirement.
    Title: Defense Federal Acquisition Regulation Supplement (DFARS) 
2009-D017; Continuation of Essential Contractor Services.
    Type of Request: New collection.
    Number of Respondents: 7,600.
    Responses per Respondents: 1.25.
    Annual Responses: 9,500.
    Average Burden per Response: 2.
    Total Annual Burden Hours: 19,000.
    Needs and Uses: DoD needs this information to ensure essential 
contractor services are performed for continuity of operations.
    Affected Public: Businesses or other for-profit institutions.
    Frequency: On occasion.
    Respondent's Obligation: Required to obtain contract.
    The interim rule, published at 75 FR 10191, on March 5, 2010, 
invited comments on the following aspects of the interim rule: (a) 
Whether the collection of information is necessary for the proper 
performance of the functions of DoD, including whether the information 
will have practical utility; (b) the accuracy of the estimate of the 
burden of the information collection; (c) ways to enhance the quality, 
utility, and clarity of the information to be collected; and (d) ways 
to minimize the burden of the information collection on respondents, 
including the use of automated collection techniques or other forms of 
information technology. No comments were received regarding this 
information collection requirement.
    To request more information on this information collection or to 
obtain a copy of the information collection requirement and associated 
collection instruments, please write to the Defense Acquisition 
Regulations System (DARS), Attn: Mr. Julian Thrash, 
OUSD(AT&L)DPAP(DARS), Room 3B855, 3060 Defense Pentagon, Washington, DC 
20301-3060.

List of Subjects in 48 CFR Parts 237 and 252

    Government procurement.

Clare M. Zebrowski,
Editor, Defense Acquisition Regulations System.

0
Therefore, the Defense Acquisition Regulations System confirms as final 
the interim rule published at 75 FR 10191, March 5, 2010, with the 
following changes:
0
1. The authority citation for 48 CFR parts 237 and 252 continues to 
read as follows:

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

PART 237--SERVICE CONTRACTING

0
2. Subpart 237.76 is revised to read as follows:
Subpart 237.76--Continuation of Essential Contractor Services
Sec.
237.7600 Scope.
237.7601 Definitions.
237.7602 Policy.
237.7603 Solicitation provision and contract clause.

Subpart 237.76--Continuation of Essential Contractor Services


237.7600  Scope.

    This subpart prescribes procedures for the acquisition of essential 
contractor services which support mission-essential functions.


237.7601  Definitions.

    As used in this subpart, essential contractor service and mission-
essential functions are defined in the clause at 252.237-7023, 
Continuation of Essential Contractor Services.


237.7602  Policy.

    (a) Contractors providing services designated as essential 
contractor services shall be prepared to continue providing such 
services, in accordance with the terms and conditions of their 
contracts, during periods of crisis. As a general rule, the designation 
of services as essential contractor services will not apply to an 
entire contract but will apply only to those service functions that 
have been specifically identified as essential contractor services by 
the functional commander or civilian equivalent.
    (b) Contractors who provide Government-determined essential 
contractor services shall provide a written plan to be incorporated in 
the contract, to ensure the continuation of these services in crisis 
situations. Contracting officers shall consult with a functional 
manager to assess the sufficiency of the contractor-provided written 
plan. Contractors will activate such plans only during periods of 
crisis, as authorized by the contracting officer, who does so at the 
direction of the appropriate functional commander or civilian 
equivalent.
    (c) The contracting officer shall follow the procedures at PGI 
207.105U(b)(20)(C) in preparing an acquisition plan.


237.7603  Solicitation provision and contract clause.

    (a) Use the clause at 252.237-7023, Continuation of Essential 
Contractor Services in all solicitations and contracts for services 
that are in support of mission-essential functions.
    (b) Use the provision at 252.237-7024, Notice of Continuation of 
Essential Contractor Services in all solicitations for services that 
include the clause 252.237-7023.

PART 252--SOLICITATION PROVISIONS AND CONTRACT CLAUSES

0
3. Section 252.237-7023 is revised to read as follows:

[[Page 66683]]

252.237-7023  Continuation of Essential Contractor Services.

    As prescribed in 237.7603(a), use the following clause:

CONTINUATION OF ESSENTIAL CONTRACTOR SERVICES (OCT 2010)

    (a) Definitions. As used in this clause-
    (1) Essential contractor service means a service provided by a 
firm or individual under contract to DoD to support mission-
essential functions, such as support of vital systems, including 
ships owned, leased, or operated in support of military missions or 
roles at sea; associated support activities, including installation, 
garrison, and base support services; and similar services provided 
to foreign military sales customers under the Security Assistance 
Program. Services are essential if the effectiveness of defense 
systems or operations has the potential to be seriously impaired by 
the interruption of these services, as determined by the appropriate 
functional commander or civilian equivalent.
    (2) Mission-essential functions means those organizational 
activities that must be performed under all circumstances to achieve 
DoD component missions or responsibilities, as determined by the 
appropriate functional commander or civilian equivalent. Failure to 
perform or sustain these functions would significantly affect DoD's 
ability to provide vital services or exercise authority, direction, 
and control.
    (b) The Government has identified all or a portion of the 
contractor services performed under this contract as essential 
contractor services in support of mission-essential functions. These 
services are listed in attachment --, Mission-Essential Contractor 
Services, dated --------.
    (c)(1) The Mission-Essential Contractor Services Plan submitted 
by the Contractor, is incorporated in this contract.
    (2) The Contractor shall maintain and update its plan as 
necessary. The Contractor shall provide all plan updates to the 
Contracting Officer for approval.
    (3) As directed by the Contracting Officer, the Contractor shall 
participate in training events, exercises, and drills associated 
with Government efforts to test the effectiveness of continuity of 
operations procedures and practices.
    (d)(1) Notwithstanding any other clause of this contract, the 
Contractor shall be responsible to perform those services identified 
as essential contractor services during crisis situations (as 
directed by the Contracting Officer), in accordance with its 
Mission-Essential Contractor Services Plan.
    (2) In the event the Contractor anticipates not being able to 
perform any of the essential contractor services identified in 
accordance with paragraph (b) of this clause during a crisis 
situation, the Contractor shall notify the Contracting Officer or 
other designated representative as expeditiously as possible and use 
its best efforts to cooperate with the Government in the 
Government's efforts to maintain the continuity of operations.
    (e) The Government reserves the right in such crisis situations 
to use Federal employees, military personnel, or contract support 
from other contractors, or to enter into new contracts for essential 
contractor services.
    (f) Changes. The Contractor shall segregate and separately 
identify all costs incurred in continuing performance of essential 
services in a crisis situation. The Contractor shall notify the 
Contracting Officer of an increase or decrease in costs within 
ninety days after continued performance has been directed by the 
Contracting Officer, or within any additional period that the 
Contracting Officer approves in writing, but not later than the date 
of final payment under the contract. The Contractor's notice shall 
include the Contractor's proposal for an equitable adjustment and 
any data supporting the increase or decrease in the form prescribed 
by the Contracting Officer. The parties shall negotiate an equitable 
price adjustment to the contract price, delivery schedule, or both 
as soon as is practicable after receipt of the Contractor's 
proposal.
    (g) The Contractor shall include the substance of this clause, 
including this paragraph (g), in subcontracts for the essential 
services.


(End of clause)

0
4. Section 252.237-7024 is added to read as follows:


252.237-7024  Notice of Continuation of Essential Contractor Services.

    As prescribed in 237.7603(b), use the following provision:

NOTICE OF CONTINUATION OF ESSENTIAL CONTRACTOR SERVICES [OCT 2010]

    (a) Definitions. Essential contractor service and mission-
essential functions have the meanings given in the clause at 
252.237-7023, Continuation of Essential Contractor Services, in this 
solicitation.
    (b) The offeror shall provide with its offer a written plan 
describing how it will continue to perform the essential contractor 
services listed in attachment --, Mission Essential Contractor 
Services, dated --------, during periods of crisis. The offeror 
shall--
    (1) Identify provisions made for the acquisition of essential 
personnel and resources, if necessary, for continuity of operations 
for up to 30 days or until normal operations can be resumed;
    (2) Address in the plan, at a minimum--
    (i) Challenges associated with maintaining essential contractor 
services during an extended event, such as a pandemic that occurs in 
repeated waves;
    (ii) The time lapse associated with the initiation of the 
acquisition of essential personnel and resources and their actual 
availability on site;
    (iii) The components, processes, and requirements for the 
identification, training, and preparedness of personnel who are 
capable of relocating to alternate facilities or performing work 
from home;
    (iv) Any established alert and notification procedures for 
mobilizing identified ``essential contractor service'' personnel; 
and
    (v) The approach for communicating expectations to contractor 
employees regarding their roles and responsibilities during a 
crisis.


(End of provision)

[FR Doc. 2010-27302 Filed 10-28-10; 8:45 am]
BILLING CODE 5001-08-P