Defense Federal Acquisition Regulation Supplement: Reliability and Maintainability in Weapon System Design (DFARS Case 2019-D003), 30984-30986 [2019-13744]

Download as PDF 30984 Federal Register / Vol. 84, No. 125 / Friday, June 28, 2019 / Proposed Rules khammond on DSKBBV9HB2PROD with PROPOSALS Adjustment-Data-Validation-Program/ Resources.html. This data included a RADV Data Dictionary and Provisional Coefficients workbook. On April 30, 2019 (84 FR 18215), we announced an additional extension of the comment period for the RADV provision until August 28, 2019. We also announced that we would be releasing additional data underlying the FFS Adjuster Study, including additional data containing Protected Health Information, to all parties who entered an applicable data use agreement and paid the required fee. This data has been available since June 14, 2019. The forms and instructions to request this data and previously released data remain available via the CMS website at https://www.cms.gov/ research-statistics-data-and-systems/ files-for-order/limiteddatasets/. Updates to existing documentation related to the study data, as well as additional data without Protected Health Information, were posted on the CPI Private Plans Team website on April 25, 2019. III. Release of Additional Study Material and Further Request for Public Comment We have now replicated the FFS Adjuster Study and published a summary of that replication as an addendum to the study at: https:// www.cms.gov/Research-Statistics-Dataand-Systems/Monitoring-Programs/ Medicare-Risk-Adjustment-DataValidation-Program/Resources.html. The results of the replication are broadly consistent with the initial implementation of the study. The purpose of this replication was to allow us to both test our initial results and release a more complete set of underlying data. Certain intermediate data elements not saved as part of the implementation of the initial study have been preserved and published in the addendum or at https://www.cms.gov/ Research-Statistics-Data-and-Systems/ Monitoring-Programs/Medicare-RiskAdjustment-Data-Validation-Program/ Resources.htm. In addition, the addendum contains further discussion of the study’s assumptions and methodology. We are also releasing the programming language used to implement the replication of the study, available at https://www.cms.gov/ Research-Statistics-Data-and-Systems/ Monitoring-Programs/Medicare-RiskAdjustment-Data-Validation-Program/ Resources.html, along with a description of the technical requirements for use of that programming language. It is our intention that the release of this programming language, together with VerDate Sep<11>2014 16:43 Jun 27, 2019 Jkt 247001 the earlier release of the data used as inputs, will allow for robust public comment on the FFS Adjuster Study. We welcome public comment on that subject, and all subjects raised in this notice and the notices discussed previously, until 5 p.m. on August 28, 2019. Dated: June 21, 2019. Seema Verma, Administrator, Centers for Medicare & Medicaid Services. [FR Doc. 2019–13891 Filed 6–27–19; 8:45 am] BILLING CODE 4120–01–P DEPARTMENT OF DEFENSE Defense Acquisition Regulations System 48 CFR Parts 207, 215, 216, and 234 [Docket DARS–2019–0026] RIN 0750–AK38 Defense Federal Acquisition Regulation Supplement: Reliability and Maintainability in Weapon System Design (DFARS Case 2019–D003) Defense Acquisition Regulations System, Department of Defense (DoD). ACTION: Proposed rule. AGENCY: DOD is proposing to amend the Defense Federal Acquisition Regulation Supplement (DFARS) to implement a section of the National Defense Authorization Act for Fiscal Year 2018 that requires the use of reliability and maintainability sustainment factors in weapon system design. DATES: Comments on the proposed rule should be submitted in writing to the address shown below on or before August 27, 2019, to be considered in the formation of a final rule. ADDRESSES: Submit comments identified by DFARS Case 2019–D003, using any of the following methods: Æ Federal eRulemaking Portal: https:// www.regulations.gov. Submit comments via the Federal eRulemaking portal by entering ‘‘DFARS Case 2019–D003’’ under the heading ‘‘Enter keyword or ID’’ and selecting ‘‘Search.’’ Select the link ‘‘Submit a Comment’’ that corresponds with ‘‘DFARS Case 2019– D003.’’ Follow the instructions provided at the ‘‘Submit a Comment’’ screen. Please include your name, company name (if any), and ‘‘DFARS Case 2019– D003’’ on your attached document. Æ Email: osd.dfars@mail.mil. Include DFARS Case 2019–D003 in the subject line of the message. SUMMARY: PO 00000 Frm 00029 Fmt 4702 Sfmt 4702 Æ Fax: 571–372–6094. Æ Mail: Defense Acquisition Regulations System, Attn: Ms. Kimberly Bass, OUSD(A&S)DPC/DARS, Room 3B941, 3060 Defense Pentagon, Washington, DC 20301–3060. Comments received generally will be posted without change to https:// www.regulations.gov, including any personal information provided. To confirm receipt of your comment(s), please check www.regulations.gov, approximately two to three days after submission to verify posting (except allow 30 days for posting of comments submitted by mail). FOR FURTHER INFORMATION CONTACT: Ms. Kimberly Bass, telephone 571–372– 6174. SUPPLEMENTARY INFORMATION: I. Background DoD is proposing to amend the DFARS to implement section 834 of the National Defense Authorization Act (NDAA) for Fiscal Year (FY) 2018 (Pub. L. 115–91). Section 834 amends title 10, United States Code (U.S.C.), to add section 2443, sustainment factors in weapon system design, which requires program managers or comparable requiring activity officials exercising program management responsibilities to ensure that reliability and maintainability are included in the performance attributes of the key performance parameters on sustainment during the development of capabilities requirements for major weapon systems design and contracts for the— • Engineering and manufacturing development of a weapon system, including embedded software; or • Production of a weapon system, including embedded software. As a matter of policy, the Under Secretary of Defense for Acquisition and Sustainment directed application of the requirements of 10 U.S.C. 2443 to the technical maturation and risk reduction phase. II. Discussion and Analysis The following changes to the DFARS are proposed to implement 10 U.S.C. 2443: DFARS 207.106(S–70)(2)(ii)(A) implements 10 U.S.C. 2443 as an additional requirement for major systems, and provides guidance to the acquisition team during acquisition planning to ensure that reliability and maintainability are included in the performance attributes of the key performance parameters on sustainment during the development of capabilities requirements. DFARS 207.106(S–72)(5) informs the contracting officer to ensure best E:\FR\FM\28JNP1.SGM 28JNP1 khammond on DSKBBV9HB2PROD with PROPOSALS Federal Register / Vol. 84, No. 125 / Friday, June 28, 2019 / Proposed Rules practices are used during the development of performance measures for use in responding to the negative or positive contractor performance in meeting the contract requirements for sustainment for a weapon system as defined in 10 U.S.C. 2302 and 2303d during acquisition planning. The contracting officer is to encourage the use of incentive fees and penalties as appropriate and allow the program manager or requiring activity official performing program management responsibilities to base determination of contractor performance on reliability and maintainability data collected during the program. The data collected must be described in detail and shared with appropriate contract and Government organizations to the maximum extent practicable. DFARS 215.304(c)(vi) informs the contracting officer that, in coordination with the program manager or comparable requiring activity official performing program management responsibilities, source selections must emphasize sustainment factors and objective reliability and maintainability evaluation criteria in competitive contracts for the technical maturation and risk reduction phase, and engineering and manufacturing development of a weapon system, including embedded software; or the production of a weapon system, including embedded software. Application of this requirement to competitive contracts for the technical maturation and risk reduction phase is a matter of policy, whereas application to the engineering and manufacturing development and production of a weapon system, including embedded software, is required by statute. DFARS 216.402–2(2) requires contracting officers to ensure that information about incentive fees, or the imposition of penalties, are included in the solicitation for covered contracts if the program manager or requiring official includes provisions for the payment of incentive fees to the contractor for achievement of design specifications for reliability and maintainability or the imposition of penalties to be paid by the contractor to the Government for failure to achieve the design specifications. DFARS 234.004 informs the contracting officer to: (1) Include clearly defined measurable criteria for engineering activities and design specifications for reliability and maintainability provided by the program manager, or comparable requiring activity official performing program management responsibilities; or (2) ensure a copy of the justification VerDate Sep<11>2014 16:43 Jun 27, 2019 Jkt 247001 for the decision not to include the criteria, is included in the contract file as provided by the program manager or requiring activity official. III. Applicability to Contracts at or Below the Simplified Acquisition Threshold and for Commercial Items, Including Commercially Available Offthe-Shelf Items This rulemaking does not propose to create any new provisions or clauses or impact any existing provisions or clauses. IV. Executive Orders 12866 and 13563 Executive Orders (E.O.s) 12866 and 13563 direct agencies to assess all costs and benefits of available regulatory alternatives and, if regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety effects, distributive impacts, and equity). E.O. 13563 emphasizes the importance of quantifying both costs and benefits, of reducing costs, of harmonizing rules, and of promoting flexibility. This is not a significant regulatory action and, therefore, was not subject to review under section 6(b) of E.O. 12866, Regulatory Planning and Review, dated September 30, 1993. This rule is not a major rule under 5 U.S.C. 804. V. Executive Order 13771 This proposed rule is not expected to be an E.O. 13771 regulatory action, because this rule is not significant under E.O. 12866. VI. Regulatory Flexibility Act DoD does not expect this proposed rule to have a significant economic impact on a substantial number of small entities within the meaning of the Regulatory Flexibility Act, 5 U.S.C. 601, et seq., because the rule requires contracting officers and program managers or requiring office officials to give emphasis to sustainment factors in weapon system design. However, an initial regulatory flexibility analysis has been performed and is summarized as follows: DOD is proposing to amend the Defense Federal Acquisition Regulation Supplement (DFARS) to implement section 834 of the National Defense Authorization Act (NDAA) for Fiscal Year (FY) 2018. Section 834 amends Title 10, United States Code, to add section 2443, Sustainment factors in weapon system design, which requires program managers or comparable requiring activity officials exercising program management responsibilities to PO 00000 Frm 00030 Fmt 4702 Sfmt 4702 30985 ensure that reliability and maintainability are included in the performance attributes of the key performance parameters on sustainment during the development of capabilities requirements for major weapon systems design and contracts for the technical maturation and risk reduction and engineering and manufacturing development of a weapon system, including embedded software; or production of a weapon system. The objective of this proposed rule is to require contracting officers, in coordination with program managers or requiring office officials, to ensure that reliability and maintainability are included in the performance attributes of the key performance parameter on sustainment during the development of capabilities requirements. According to information available in the Federal Procurement Data System for fiscal years 2016 through 2018, DoD made a total of 200 contract awards under various product service codes for research and engineering development under the product service group AC, Research and Development-Defense Systems. The award data included task and delivery orders under single award indefinite delivery indefinite quantity contracts and basic ordering agreements. Of the total 200 awards for the threeyear period cited, 79 awards (approximately 40 percent) were made to 71 unique small business entities. This proposed rule does not include any new reporting, recordkeeping, or other compliance requirements for small businesses. The proposed rule does not duplicate, overlap, or conflict with any other Federal rules. There are no known significant alternative approaches to the proposed rule that would meet the proposed objectives. DoD invites comments from small entities concerning the existing regulations in subparts affected by this rule in accordance with 5 U.S.C. 610. Interested parties must submit such comments separately and should cite 5 U.S.C. 610 (DFARS Case 2019–D003), in correspondence. This action is necessary to implement section 834 of the NDAA for FY 2018. VII. Paperwork Reduction Act The rule does not contain any information collection requirements that require the approval of the Office of Management and Budget under the Paperwork Reduction Act (44 U.S.C. chapter 35). E:\FR\FM\28JNP1.SGM 28JNP1 30986 Federal Register / Vol. 84, No. 125 / Friday, June 28, 2019 / Proposed Rules List of Subjects in 48 CFR Parts 207, 215, 216, and 234 Government procurement. Jennifer Lee Hawes, Regulatory Control Officer, Defense Acquisition Regulations System. Therefore, 48 CFR parts 207, 215, 216, and 234 are proposed to be amended as follows: ■ 1. The authority citation for 48 CFR parts 207, 215, 216, and 234 continues to read as follows: PART 215—CONTRACTING BY NEGOTIATION 3. Amend section 215.304 by adding paragraph (c)(vi) to read as follows: Authority: 41 U.S.C. 1303 and 48 CFR chapter 1. ■ PART 207—ACQUISITION PLANNING 215.304 Evaluation factors and significant subfactors. 2. Amend section 207.106 by— a. In paragraph (S–70)(1), removing ‘‘Section 802(a)’’ and adding ‘‘section 802(a)’’ in its place; ■ b. Redesignating paragraphs (S– 70)(2)(ii) through (iv) as paragraphs (iii) through (v), respectively; ■ c. Adding a new paragraph (S– 70)(2)(ii); and ■ d. Adding paragraph (S–72)(5). The additions read as follows: (c) * * * (vi) Ensure source selections emphasize sustainment factors and objective reliability and maintainability evaluation criteria in competitive contracts for the— (A) Technical maturation and risk reduction phase of weapon system design (see guidance at PGI 207.105(b)(14)(ii)(2)); (B) Engineering and manufacturing development phase of a weapon system, including embedded software (10 U.S.C. 2443); or (C) Production and deployment phase of a weapon system, including embedded software (10 U.S.C. 2443). ■ ■ 207.106 Additional requirements for major systems. * khammond on DSKBBV9HB2PROD with PROPOSALS of a contractor’s performance on reliability and maintainability data collected during the program. Such data collection and associated evaluation metrics shall be described in detail in the contract; and to the maximum extent practicable, the data shall be shared with appropriate contractor and Government organizations. * * * * * * * * * (S–70) * * * (2) * * * (ii) In accordance with 10 U.S.C. 2443, to emphasize reliability and maintainability in weapon system design, ensure that reliability and maintainability are included in the performance attributes of the key performance parameters on sustainment during the development of capabilities requirements. For additional guidance see PGI 207.105(b)(14)(ii)(2); * * * * * (S–72) * * * (5) In accordance with 10 U.S.C. 2443, acquisition plans for engineering manufacturing and development and production of major systems as defined in 10 U.S.C. 2302 and 2302d and for major defense acquisition programs as defined in 202.101, shall include performance measures that are developed using best practices for responding to the positive or negative performance of a contractor for the engineering and manufacturing development or production of a weapon system, including embedded software. At a minimum the contracting officer shall— (i) Encourage the use of incentive fees and penalties as appropriate; and (ii) Allow the program manager or comparable requiring activity official exercising program management responsibilities, to base determinations VerDate Sep<11>2014 16:43 Jun 27, 2019 Jkt 247001 PART 216—TYPES OF CONTRACTS 4. Amend section 216.402–2 by— a. Designating the text as paragraph (1); and ■ b. Adding paragraph (2). The addition reads as follows: ■ ■ 216.402–2 Technical performance incentives. * * * * * (2) Contracting officers shall ensure requirements about the payment of incentive fees or the imposition of penalties are included in the solicitation for a contract for the engineering and manufacturing development or production of a weapon system, including embedded software, if the program manager or comparable requiring activity official exercising program manager responsibilities includes— (i) Provisions for the payment of incentive fees to the contractor, based on achievement of design specification requirements for reliability and maintainability of weapons systems under the contract; or (ii) The imposition of penalties to be paid by the contractor to the Government for failure to achieve such design specification requirements (10 U.S.C. 2443). PO 00000 Frm 00031 Fmt 4702 Sfmt 4702 PART 234—MAJOR SYSTEM ACQUISITION 5. Amend section 234.004 by adding paragraph (3) to read as follows: ■ 234.004 Acquisition strategy. * * * * * (3) The contracting officer shall include in solicitations for contracts for the technical maturation and risk reduction phase, engineering and manufacturing development phase or production phase of a weapon system, including embedded software— (i) Clearly defined measurable criteria for engineering activities and design specifications for reliability and maintainability provided by the program manager, or the comparable requiring activity official performing program management responsibilities; or (ii) Ensure a copy of the justification, executed by the program manager or the comparable requiring activity official performing program management responsibilities for the decision that engineering activities and design specifications for reliability and maintainability should not be a requirement, is included in the contract file (10 U.S.C. 2443). [FR Doc. 2019–13744 Filed 6–27–19; 8:45 am] BILLING CODE 5001–06–P DEPARTMENT OF DEFENSE Defense Acquisition Regulations System 48 CFR Parts 228 and 252 [Docket DARS–2019–0030] RIN 0750–AK12 Defense Federal Acquisition Regulation Supplement: Modification of DFARS Clause ‘‘Accident Reporting and Investigation Involving Aircraft, Missiles, and Space Launch Vehicles’’ (DFARS Case 2018–D047) Defense Acquisition Regulations System, Department of Defense (DoD). ACTION: Proposed rule. AGENCY: DoD is proposing to amend the Defense Federal Acquisition Regulation Supplement (DFARS) to modify the text of an existing clause prescription to require, instead of permit, the clause be included in applicable solicitations and contracts, pursuant to action taken by the Regulatory Reform Task Force. DATES: Comments on the proposed rule should be submitted in writing to the SUMMARY: E:\FR\FM\28JNP1.SGM 28JNP1

Agencies

[Federal Register Volume 84, Number 125 (Friday, June 28, 2019)]
[Proposed Rules]
[Pages 30984-30986]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2019-13744]


=======================================================================
-----------------------------------------------------------------------

DEPARTMENT OF DEFENSE

Defense Acquisition Regulations System

48 CFR Parts 207, 215, 216, and 234

[Docket DARS-2019-0026]
RIN 0750-AK38


Defense Federal Acquisition Regulation Supplement: Reliability 
and Maintainability in Weapon System Design (DFARS Case 2019-D003)

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

ACTION: Proposed rule.

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

SUMMARY: DOD is proposing to amend the Defense Federal Acquisition 
Regulation Supplement (DFARS) to implement a section of the National 
Defense Authorization Act for Fiscal Year 2018 that requires the use of 
reliability and maintainability sustainment factors in weapon system 
design.

DATES: Comments on the proposed rule should be submitted in writing to 
the address shown below on or before August 27, 2019, to be considered 
in the formation of a final rule.

ADDRESSES: Submit comments identified by DFARS Case 2019-D003, using 
any of the following methods:
    [cir] Federal eRulemaking Portal: https://www.regulations.gov. 
Submit comments via the Federal eRulemaking portal by entering ``DFARS 
Case 2019-D003'' under the heading ``Enter keyword or ID'' and 
selecting ``Search.'' Select the link ``Submit a Comment'' that 
corresponds with ``DFARS Case 2019-D003.'' Follow the instructions 
provided at the ``Submit a Comment'' screen. Please include your name, 
company name (if any), and ``DFARS Case 2019-D003'' on your attached 
document.
    [cir] Email: [email protected]. Include DFARS Case 2019-D003 in 
the subject line of the message.
    [cir] Fax: 571-372-6094.
    [cir] Mail: Defense Acquisition Regulations System, Attn: Ms. 
Kimberly Bass, OUSD(A&S)DPC/DARS, Room 3B941, 3060 Defense Pentagon, 
Washington, DC 20301-3060.
    Comments received generally will be posted without change to https://www.regulations.gov, including any personal information provided. To 
confirm receipt of your comment(s), please check www.regulations.gov, 
approximately two to three days after submission to verify posting 
(except allow 30 days for posting of comments submitted by mail).

FOR FURTHER INFORMATION CONTACT: Ms. Kimberly Bass, telephone 571-372-
6174.

SUPPLEMENTARY INFORMATION:

I. Background

    DoD is proposing to amend the DFARS to implement section 834 of the 
National Defense Authorization Act (NDAA) for Fiscal Year (FY) 2018 
(Pub. L. 115-91). Section 834 amends title 10, United States Code 
(U.S.C.), to add section 2443, sustainment factors in weapon system 
design, which requires program managers or comparable requiring 
activity officials exercising program management responsibilities to 
ensure that reliability and maintainability are included in the 
performance attributes of the key performance parameters on sustainment 
during the development of capabilities requirements for major weapon 
systems design and contracts for the--
     Engineering and manufacturing development of a weapon 
system, including embedded software; or
     Production of a weapon system, including embedded 
software.
    As a matter of policy, the Under Secretary of Defense for 
Acquisition and Sustainment directed application of the requirements of 
10 U.S.C. 2443 to the technical maturation and risk reduction phase.

II. Discussion and Analysis

    The following changes to the DFARS are proposed to implement 10 
U.S.C. 2443:
    DFARS 207.106(S-70)(2)(ii)(A) implements 10 U.S.C. 2443 as an 
additional requirement for major systems, and provides guidance to the 
acquisition team during acquisition planning to ensure that reliability 
and maintainability are included in the performance attributes of the 
key performance parameters on sustainment during the development of 
capabilities requirements.
    DFARS 207.106(S-72)(5) informs the contracting officer to ensure 
best

[[Page 30985]]

practices are used during the development of performance measures for 
use in responding to the negative or positive contractor performance in 
meeting the contract requirements for sustainment for a weapon system 
as defined in 10 U.S.C. 2302 and 2303d during acquisition planning. The 
contracting officer is to encourage the use of incentive fees and 
penalties as appropriate and allow the program manager or requiring 
activity official performing program management responsibilities to 
base determination of contractor performance on reliability and 
maintainability data collected during the program. The data collected 
must be described in detail and shared with appropriate contract and 
Government organizations to the maximum extent practicable.
    DFARS 215.304(c)(vi) informs the contracting officer that, in 
coordination with the program manager or comparable requiring activity 
official performing program management responsibilities, source 
selections must emphasize sustainment factors and objective reliability 
and maintainability evaluation criteria in competitive contracts for 
the technical maturation and risk reduction phase, and engineering and 
manufacturing development of a weapon system, including embedded 
software; or the production of a weapon system, including embedded 
software. Application of this requirement to competitive contracts for 
the technical maturation and risk reduction phase is a matter of 
policy, whereas application to the engineering and manufacturing 
development and production of a weapon system, including embedded 
software, is required by statute.
    DFARS 216.402-2(2) requires contracting officers to ensure that 
information about incentive fees, or the imposition of penalties, are 
included in the solicitation for covered contracts if the program 
manager or requiring official includes provisions for the payment of 
incentive fees to the contractor for achievement of design 
specifications for reliability and maintainability or the imposition of 
penalties to be paid by the contractor to the Government for failure to 
achieve the design specifications.
    DFARS 234.004 informs the contracting officer to: (1) Include 
clearly defined measurable criteria for engineering activities and 
design specifications for reliability and maintainability provided by 
the program manager, or comparable requiring activity official 
performing program management responsibilities; or (2) ensure a copy of 
the justification for the decision not to include the criteria, is 
included in the contract file as provided by the program manager or 
requiring activity official.

III. Applicability to Contracts at or Below the Simplified Acquisition 
Threshold and for Commercial Items, Including Commercially Available 
Off-the-Shelf Items

    This rulemaking does not propose to create any new provisions or 
clauses or impact any existing provisions or clauses.

IV. Executive Orders 12866 and 13563

    Executive Orders (E.O.s) 12866 and 13563 direct agencies to assess 
all costs and benefits of available regulatory alternatives and, if 
regulation is necessary, to select regulatory approaches that maximize 
net benefits (including potential economic, environmental, public 
health and safety effects, distributive impacts, and equity). E.O. 
13563 emphasizes the importance of quantifying both costs and benefits, 
of reducing costs, of harmonizing rules, and of promoting flexibility. 
This is not a significant regulatory action and, therefore, was not 
subject to review under section 6(b) of E.O. 12866, Regulatory Planning 
and Review, dated September 30, 1993. This rule is not a major rule 
under 5 U.S.C. 804.

V. Executive Order 13771

    This proposed rule is not expected to be an E.O. 13771 regulatory 
action, because this rule is not significant under E.O. 12866.

VI. Regulatory Flexibility Act

    DoD does not expect this proposed rule to have a significant 
economic impact on a substantial number of small entities within the 
meaning of the Regulatory Flexibility Act, 5 U.S.C. 601, et seq., 
because the rule requires contracting officers and program managers or 
requiring office officials to give emphasis to sustainment factors in 
weapon system design. However, an initial regulatory flexibility 
analysis has been performed and is summarized as follows:
    DOD is proposing to amend the Defense Federal Acquisition 
Regulation Supplement (DFARS) to implement section 834 of the National 
Defense Authorization Act (NDAA) for Fiscal Year (FY) 2018. Section 834 
amends Title 10, United States Code, to add section 2443, Sustainment 
factors in weapon system design, which requires program managers or 
comparable requiring activity officials exercising program management 
responsibilities to ensure that reliability and maintainability are 
included in the performance attributes of the key performance 
parameters on sustainment during the development of capabilities 
requirements for major weapon systems design and contracts for the 
technical maturation and risk reduction and engineering and 
manufacturing development of a weapon system, including embedded 
software; or production of a weapon system.
    The objective of this proposed rule is to require contracting 
officers, in coordination with program managers or requiring office 
officials, to ensure that reliability and maintainability are included 
in the performance attributes of the key performance parameter on 
sustainment during the development of capabilities requirements.
    According to information available in the Federal Procurement Data 
System for fiscal years 2016 through 2018, DoD made a total of 200 
contract awards under various product service codes for research and 
engineering development under the product service group AC, Research 
and Development-Defense Systems. The award data included task and 
delivery orders under single award indefinite delivery indefinite 
quantity contracts and basic ordering agreements. Of the total 200 
awards for the three-year period cited, 79 awards (approximately 40 
percent) were made to 71 unique small business entities.
    This proposed rule does not include any new reporting, 
recordkeeping, or other compliance requirements for small businesses. 
The proposed rule does not duplicate, overlap, or conflict with any 
other Federal rules.
    There are no known significant alternative approaches to the 
proposed rule that would meet the proposed objectives.
    DoD invites comments from small entities concerning the existing 
regulations in subparts affected by this rule in accordance with 5 
U.S.C. 610. Interested parties must submit such comments separately and 
should cite 5 U.S.C. 610 (DFARS Case 2019-D003), in correspondence.
    This action is necessary to implement section 834 of the NDAA for 
FY 2018.

VII. Paperwork Reduction Act

    The rule does not contain any information collection requirements 
that require the approval of the Office of Management and Budget under 
the Paperwork Reduction Act (44 U.S.C. chapter 35).

[[Page 30986]]

List of Subjects in 48 CFR Parts 207, 215, 216, and 234

    Government procurement.

Jennifer Lee Hawes,
Regulatory Control Officer, Defense Acquisition Regulations System.

    Therefore, 48 CFR parts 207, 215, 216, and 234 are proposed to be 
amended as follows:

0
1. The authority citation for 48 CFR parts 207, 215, 216, and 234 
continues to read as follows:

    Authority:  41 U.S.C. 1303 and 48 CFR chapter 1.

PART 207--ACQUISITION PLANNING

0
2. Amend section 207.106 by--
0
a. In paragraph (S-70)(1), removing ``Section 802(a)'' and adding 
``section 802(a)'' in its place;
0
b. Redesignating paragraphs (S-70)(2)(ii) through (iv) as paragraphs 
(iii) through (v), respectively;
0
c. Adding a new paragraph (S-70)(2)(ii); and
0
d. Adding paragraph (S-72)(5).
    The additions read as follows:


207.106   Additional requirements for major systems.

* * * * *
    (S-70) * * *
    (2) * * *
    (ii) In accordance with 10 U.S.C. 2443, to emphasize reliability 
and maintainability in weapon system design, ensure that reliability 
and maintainability are included in the performance attributes of the 
key performance parameters on sustainment during the development of 
capabilities requirements. For additional guidance see PGI 
207.105(b)(14)(ii)(2);
* * * * *
    (S-72) * * *
    (5) In accordance with 10 U.S.C. 2443, acquisition plans for 
engineering manufacturing and development and production of major 
systems as defined in 10 U.S.C. 2302 and 2302d and for major defense 
acquisition programs as defined in 202.101, shall include performance 
measures that are developed using best practices for responding to the 
positive or negative performance of a contractor for the engineering 
and manufacturing development or production of a weapon system, 
including embedded software. At a minimum the contracting officer 
shall--
    (i) Encourage the use of incentive fees and penalties as 
appropriate; and
    (ii) Allow the program manager or comparable requiring activity 
official exercising program management responsibilities, to base 
determinations of a contractor's performance on reliability and 
maintainability data collected during the program. Such data collection 
and associated evaluation metrics shall be described in detail in the 
contract; and to the maximum extent practicable, the data shall be 
shared with appropriate contractor and Government organizations.
* * * * *

PART 215--CONTRACTING BY NEGOTIATION

0
3. Amend section 215.304 by adding paragraph (c)(vi) to read as 
follows:


215.304   Evaluation factors and significant subfactors.

    (c) * * *
    (vi) Ensure source selections emphasize sustainment factors and 
objective reliability and maintainability evaluation criteria in 
competitive contracts for the--
    (A) Technical maturation and risk reduction phase of weapon system 
design (see guidance at PGI 207.105(b)(14)(ii)(2));
    (B) Engineering and manufacturing development phase of a weapon 
system, including embedded software (10 U.S.C. 2443); or
    (C) Production and deployment phase of a weapon system, including 
embedded software (10 U.S.C. 2443).

PART 216--TYPES OF CONTRACTS

0
4. Amend section 216.402-2 by--
0
a. Designating the text as paragraph (1); and
0
b. Adding paragraph (2).
    The addition reads as follows:


216.402-2   Technical performance incentives.

* * * * *
    (2) Contracting officers shall ensure requirements about the 
payment of incentive fees or the imposition of penalties are included 
in the solicitation for a contract for the engineering and 
manufacturing development or production of a weapon system, including 
embedded software, if the program manager or comparable requiring 
activity official exercising program manager responsibilities 
includes--
    (i) Provisions for the payment of incentive fees to the contractor, 
based on achievement of design specification requirements for 
reliability and maintainability of weapons systems under the contract; 
or
    (ii) The imposition of penalties to be paid by the contractor to 
the Government for failure to achieve such design specification 
requirements (10 U.S.C. 2443).

PART 234--MAJOR SYSTEM ACQUISITION

0
5. Amend section 234.004 by adding paragraph (3) to read as follows:


234.004   Acquisition strategy.

* * * * *
    (3) The contracting officer shall include in solicitations for 
contracts for the technical maturation and risk reduction phase, 
engineering and manufacturing development phase or production phase of 
a weapon system, including embedded software--
    (i) Clearly defined measurable criteria for engineering activities 
and design specifications for reliability and maintainability provided 
by the program manager, or the comparable requiring activity official 
performing program management responsibilities; or
    (ii) Ensure a copy of the justification, executed by the program 
manager or the comparable requiring activity official performing 
program management responsibilities for the decision that engineering 
activities and design specifications for reliability and 
maintainability should not be a requirement, is included in the 
contract file (10 U.S.C. 2443).

[FR Doc. 2019-13744 Filed 6-27-19; 8:45 am]
 BILLING CODE 5001-06-P

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