[Federal Register: February 23, 2004 (Volume 69, Number 35)]
[Proposed Rules]
[Page 8153-8154]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr23fe04-30]
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DEPARTMENT OF DEFENSE
48 CFR Part 228
[DFARS Case 2003-D037]
Defense Federal Acquisition Regulation Supplement; Insurance
AGENCY: Department of Defense (DoD).
ACTION: Proposed rule with request for comments.
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SUMMARY: DoD is proposing to amend the Defense Federal Acquisition
Regulation Supplement (DFARS) to update text pertaining to insurance
requirements. This proposed rule is a result of a transformation
initiative undertaken by DoD to dramatically change the purpose and
content of the DFARS.
DATES: Comments on the proposed rule should be submitted in writing to
the address shown below on or before April 23, 2004, to be considered
in the formation of the final rule.
ADDRESSES: Respondents may submit comments via the Internet at http://emissary.acq.osd.mil/dar/dfars.nsf/pubcomm.
As an alternative,
respondents may e-mail comments to: dfars@osd.mil. Please cite DFARS
Case 2003-D037 in the subject line of e-mailed comments.
Respondents that cannot submit comments using either of the above
methods may submit comments to: Defense Acquisition Regulations
Council, Attn: Mr. Thaddeus Godlewski, OUSD (AT&L) DPAP (DAR), IMD
3C132, 3062 Defense Pentagon, Washington, DC 20301-3062; facsimile
(703) 602-0350. Please cite DFARS Case 2003-D037.
At the end of the comment period, interested parties may view
public comments on the Internet at http://emissary.acq.osd.mil/dar/dfars.nsf
.
FOR FURTHER INFORMATION CONTACT: Mr. Thaddeus Godlewski, (703) 602-
2202.
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/dp/dars/transf.htm.
This proposed rule is a result of the DFARS Transformation
initiative. The proposed changes delete DFARS text in the areas
addressed below. This text will be relocated to the new DFARS companion
resource, Procedures, Guidance, and Information (PGI). A proposed rule
describing the purpose and structure of PGI is published elsewhere in
this issue of the Federal Register under DFARS Case 2003-D090,
Procedures, Guidance, and Information.
DFARS 228.304, Risk-pooling arrangements. In the
early 1950's, DoD teamed with the insurance industry to develop a
program that would minimize the cost of workers' compensation and
contractor liability charged to Government contracts. The objective was
to provide an optional insurance plan to be used if it provided a
better deal than what could be purchased on
[[Page 8154]]
the open market. The team's solution was the National Defense Projects
Rating Plan (NDPRP). The NDPRP defined premiums via a formula based
upon average workers' compensation rates throughout the country and
adjusted for experience pooled from Defense contractors. This produced
premiums without loadings, e.g., commissions, and eliminated the burden
of negotiating premiums every year with insurance carriers. Today,
there is little cost difference between the NDPRP and the states'
workers' compensation program, because the states have adopted the same
premium algorithm as the NDPRP and many contractors have adopted self-
insurance. The text at DFARS 228.304 may be beneficial in the event of
a prolonged surge in Defense contract activity, and should be retained
as guidance. Accordingly, DoD proposes to remove this text from the
DFARS and relocate it to the new DFARS companion resource, PGI.
DFARS 228.305, Overseas workers' compensation
and war-hazard insurance. The Defense Base Act (42 U.S.C. 1651 et seq.)
extends the Longshoremen's and Harbor Workers' Compensation Act (33
U.S.C. 901) to various classes of employees working outside the United
States. When the agency head recommends a waiver to the Secretary of
Labor, the Secretary may waive the applicability of the Defense Base
Act to any contract, subcontract, work location, or classification of
employees. DFARS 228.305 provides the procedures within DoD for
submitting such requests for waiver. DoD proposes to remove this
procedural text from the DFARS and relocate it to the new DFARS
companion resource, PGI.
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 does not expect this 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
deletes DFARS text addressing procedures that are no longer in use or
that are internal to DoD. Therefore, DoD has not performed an initial
regulatory flexibility analysis. DoD invites comments from small
businesses and other interested parties. DoD also will consider
comments from small entities concerning the affected DFARS subpart in
accordance with 5 U.S.C. 610. Such comments should be submitted
separately and should cite DFARS Case 2003-D037.
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 228
Government procurement.
Michele P. Peterson,
Executive Editor, Defense Acquisition Regulations Council.
Therefore, DoD proposes to amend 48 CFR Part 228 as follows:
1. The authority citation for 48 CFR Part 228 continues to read as
follows:
Authority: 41 U.S.C. 421 and 48 CFR Chapter 1.
PART 228--BONDS AND INSURANCE
2. Sections 228.304 and 228.305 are revised to read as follows:
228.304 Risk-pooling arrangements.
DoD has established the National Defense Projects Rating Plan, also
known as the Special Casualty Insurance Rating Plan, as a risk-pooling
arrangement to minimize the cost to the Government of purchasing the
liability insurance listed in FAR 28.307-2. Use the plan in accordance
with the procedures at PGI 228.304 when it provides the necessary
coverage more advantageously than commercially available coverage.
228.305 Overseas workers' compensation and war-hazard insurance.
(d) When submitting requests for waiver, follow the procedures at
PGI 228.305(d).
[FR Doc. 04-3692 Filed 2-20-04; 8:45 am]
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