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Federal Register / Vol. 86, No. 129 / Friday, July 9, 2021 / Rules and Regulations
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determined by the Under Secretary of Defense for Acquisition and Sustainment USDA&S, set forth policies, procedures, requirements, or restrictions for the acquisition of property or services unless The provision of law Provides for criminal or civil penalties;
Requires that certain articles be bought from American sources pursuant to 10 U.S.C. 2533a or that strategic materials critical to national security be bought from American sources pursuant to 10 U.S.C. 2533b;
Specifically refers to 10 U.S.C. 2375
and states that it shall apply to contracts and subcontracts for the acquisition of commercial items including COTS
items; or USDA&S determines in writing that it would not be in the best interest of the Government to exempt contracts or subcontracts for the acquisition of commercial items from the applicability of the provision.
This authority has been delegated to the Principal Director, Defense Pricing and Contracting.
Consistent with 10 U.S.C. 2375, DoD
has determined that it is in the best interest of the United States to apply the requirements of 10 U.S.C. 2330a to the acquisition of commercials items, excluding COTS items. The intent of the statute is to enhance DoDs ability to manage the total force, inclusive of military, civilian, and contractor personnel. Specifically, section 2330a, as amended, requires the military departments and defense agencies to ensure that the inventory of contracts for services required by the statute is used to inform strategic workforce planning decisions under 10 U.S.C.
129a and develop budget justification materials for services in accordance with 10 U.S.C. 235. An exception for services that meet the definition of a commercial item would exclude significant sums expended by DoD on contracted services intended to be covered by the law, thereby undermining the overarching public policy purpose of the law. Therefore, this rule will apply to the acquisition of commercial items, excluding COTS
items.
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
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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 6b of E.O. 12866, Regulatory Planning and Review, dated September 30, 1993.
V. Congressional Review Act As required by the Congressional Review Act 5 U.S.C. 801808 before an interim or final rule takes effect, DoD
will submit a copy of the interim or final rule with the form, Submission of Federal Rules under the Congressional Review Act, to the U.S. Senate, the U.S.
House of Representatives, and the Comptroller General of the United States. A major rule under the Congressional Review Act cannot take effect until 60 days after it is published in the Federal Register. The Office of Information and Regulatory Affairs has determined that this rule is not a major rule as defined by 5 U.S.C. 8042.
VI. Regulatory Flexibility Act A final regulatory flexibility analysis FRFA has been prepared consistent with the Regulatory Flexibility Act, 5
U.S.C. 601, et seq. The FRFA is summarized as follows:
The objective of this rule is to implement 10 U.S.C. 2330a, as modified by section 812 of the National Defense Authorization Act NDAA for Fiscal Year FY 2017 Pub. L. 114328, which requires DoD to establish a data collection system that provides management information on each purchase of services by a military department or defense agency in excess of $3 million for the following service acquisition portfolio groups: Logistics management services; equipmentrelated services; knowledge-based services; and electronics and communications services.
As a result, DoD is amending the Defense Federal Acquisition Regulation Supplement DFARS to require contractors to annually report certain data on applicable contracts in order to meet the data requirements of the statute and DoDs total workforce management efforts. No public comments were received in response to the initial regulatory flexibility analysis.
Based on data from the Federal Procurement Data System for FY 2016
through 2018, DoD awards annually an average of 4,386 service contracts and orders to 1,934 unique entities that have an estimated value greater than $3
million and are within the four portfolio groups outlined in the rule. Of the 4,386
contracts and orders awarded annually,
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approximately 2,059 47 percent are made to 1,227 63 percent unique small entities.
This rule requires all contractors that are awarded a contract or order in excess of $3 million for services in any of the four service acquisition portfolio groups to report contract data in the System for Award Management SAM.
The contractor is required to report the total amount invoiced for services performed during the preceding fiscal year and the number of direct labor hours, including first-tier subcontractor hours, expended on services performed during the preceding fiscal year. The Government estimates that a journeyman level contractor employee with basic knowledge of the contract would be required to enter the data. The contractor employee may also need to gather additional billing information from the organization in order to complete the data input in SAM.
While this rule does not impose a significant economic impact on small entities, DoD has taken steps to minimize the impact of the rule on both small and large entities. Specifically, DoD now requires reporting under the rule to be done in SAM, instead of the Enterprise-wide Contractor Manpower Reporting Application ECMRA. This change permits contractors to report fewer data elements under the rule and implements a data collection system that is familiar to contractors under the existing service contract reporting requirements of the Federal Acquisition Regulation.
VII. Paperwork Reduction Act This rule contains information collection requirements that have been approved by the Office of Management and Budget under the Paperwork Reduction Act 44 U.S.C. chapter 35.
This information collection requirement has been assigned OMB Control Number 07040519, entitled Defense Federal Acquisition Supplement DFARS;
Subpart 204.17, Service Contracts Inventory, and Associated Clause.
List of Subjects in 48 CFR Parts 204, 212, and 252
Government procurement.
Jennifer D. Johnson, Regulatory Control Officer, Defense Acquisition Regulations System.

Therefore, 48 CFR parts 204, 212, and 252 are amended as follows:
1. The authority citation for parts 204, 212, and 252 continues to read as follows:
Authority: 41 U.S.C. 1303 and 48 CFR
chapter 1.

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