05-22104. Defense Federal Acquisition Regulation Supplement; Contract Modifications

AGENCY:

Department of Defense (DoD).

ACTION:

Final rule.

SUMMARY:

DoD has issued a final rule amending the Defense Federal Acquisition Regulation Supplement (DFARS) to update text pertaining to contract modifications. This rule is a result of a transformation initiative undertaken by DoD to dramatically change the purpose and content of the DFARS.

EFFECTIVE DATE:

November 9, 2005.

FOR FURTHER INFORMATION CONTACT:

Ms. Deborah Tronic, Defense Acquisition Regulations System, OUSD (AT&L) DPAP (DAR), IMD 3C132, 3062 Defense Pentagon, Washington, DC 20301-3062. Telephone [phone]; facsimile [phone]. Please cite DFARS Case 2003-D024.

SUPPLEMENTARY INFORMATION:

A. Background

DFARS Transformation is a major DoD initiative to dramatically change the purpose and content of the DFARS. The objective is to improve the efficiency and effectiveness of the acquisition process, while allowing the acquisition workforce the flexibility to innovate. The transformed DFARS will contain only requirements of law, DoD-wide policies, delegations of FAR authorities, deviations from FAR requirements, and policies/procedures that have a significant effect beyond the internal operating procedures of DoD or a significant cost or administrative impact on contractors or offerors. Additional information on the DFARS Transformation initiative is available at http://www.acq.osd.mil/​dpap/​dars/​dfars/​transformation/​index.htm.

This final rule is a result of the DFARS Transformation initiative. The rule:

• Deletes unnecessary text at DFARS 243.102, 243.105(a)(ii), 243.107, and 243.204-71.
• Deletes obsolete text at DFARS 243.105(a)(i).
• Updates text at DFARS 243.107-70 for consistency with the requirements of the clause at DFARS 252.249-7002, Notification of Anticipated Contract Termination or Reduction.
• Clarifies procedures at DFARS 243.204-70 for determining if a request for equitable contract adjustment meets the dollar threshold for requiring contractor certification.
• Deletes text at DFARS 243.170, 243.171, and 243.204 containing procedures for identification of foreign military sales requirements, for obligation or deobligation of contract funds, and for review and definitization of contract change orders. This text has been relocated to the new DFARS companion resource, Procedures, Guidance, and Information (PGI), available at http://www.acq.osd.mil/​dpap/​dars/​pgi.

DoD published a proposed rule at 70 FR 14629 on March 23, 2005. DoD received no comments on the proposed rule. Therefore, DoD has adopted the proposed rule as a final rule without change.

This rule was not subject to Office of Management and Budget review under Executive Order 12866, dated September 30, 1993.

B. Regulatory Flexibility Act

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 the rule updates, clarifies, and streamlines DFARS text, but makes no significant change to DoD contracting policy.

C. Paperwork Reduction Act

The Paperwork Reduction Act does not apply because the rule does not impose any 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 243

• Government procurement

Michele P. Peterson,

Editor, Defense Acquisition Regulations System.

Therefore, 48 CFR part 243 is amended as follows:

PART 243—CONTRACT MODIFICATIONS

1. The authority citation for 48 CFR part 243 continues to read as follows:

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

243.102, 243.105, and 243.107

[Removed]

2. Sections 243.102, 243.105, and 243.107 are removed.

3. Section 243.107-70 is amended by revising the second sentence to read as follows:

243.107-70

Notification of substantial impact on employment.

* * * The clause prescribed at 249.7003(c) requires that the contractor notify its employees, its subcontractors, and State and local officials when a contract modification will have a substantial impact on employment.

4. Sections 243.170 and 243.171 are revised to read as follows:

243.170

Identification of foreign military sale (FMS) requirements.

Follow the procedures at PGI 243.170 for identifying contract modifications that add FMS requirements.

243.171

Obligation or deobligation of funds.

Follow the procedures at PGI 243.171 when obligating or deobligating funds.

5. Section 243.204 is revised to read as follows:

243.204

Administration.

Follow the procedures at PGI 243.204 for review and definitization of change orders.

6. Section 243.204-70 is amended by revising paragraph (b) to read as follows:

243.204-70

Certification of requests for equitable adjustment.

* * * * *

(b) To determine if the dollar threshold for requiring certification is met, add together the absolute value of each cost increase and each cost decrease. See PGI 243.204-70(b) for an example.

* * * * *

243.204-71

[Removed]

7. Section 243.204-71 is removed.