FR 2020-27694

Summary of the Document

The Department of Defense (DoD) has proposed new regulations for operational contract support (OCS) outside the United States. These updates expand the range of operations where contracts may be deployed, enhance oversight and management of contractor personnel, and clarify specific responsibilities. The document aims to address the challenges in managing contractors supporting U.S. military missions. Importantly, the revisions align with prior Government Accountability Office (GAO) recommendations to improve accountability and visibility of contractor activities and personnel.

Key Issues and Concerns

There are several complex sections within the document that might be challenging for the general public to understand. For example, technical and regulatory language might obscure the intent and implications of these rules, especially for those not familiar with military operations or contract law.

A significant concern arises from the requirement for contractors to verify the medical, dental, and psychological fitness of their employees. This requirement may impose substantial costs on contracting businesses, particularly smaller entities. Such costs could discourage small businesses from participating in DoD contracts or require additional support from the DoD to ensure compliance.

The document lacks a detailed financial analysis on the potential economic impact of these proposed changes on contractors. This absence raises questions about the potential financial burden and whether the benefits of these regulations justify the costs involved.

Moreover, while the document notes the intent to address GAO's open recommendations, it does not explicitly detail how the updates will resolve specific concerns raised by the GAO. This lack of specificity might lead to doubts about the effectiveness of these proposed changes.

In some instances, such as the waiving of medical standards for contractor personnel, the guidelines could benefit from clearer criteria to avoid inconsistencies and reduce potential liability issues.

Broad Impact on the Public

These regulatory changes aim to enhance the integration and accountability of contracted support as part of the broader military force. For the general public, this could translate to more efficient military operations without compromising accountability or oversight.

Yet, there might be indirect financial implications, as increased costs on contractors could be passed on to taxpayers if government spending on these contracts rises. The revisions theoretically aim to prevent waste and fraud, which could lead to long-term savings, but these outcomes aren't guaranteed or quantified in the document.

Impact on Specific Stakeholders

Contractors and Businesses

The impact on contractors, especially small businesses, is a notable area of concern. Businesses will need to navigate increased regulatory requirements and absorb potential costs associated with verifying employee fitness. Larger companies may have the resources to comply more easily, while smaller businesses might struggle without adequate support or compensation from the DoD.

Military Operations and DoD

For military operations, these changes could enhance operational readiness and reduce gaps between military personnel and contractor capabilities. Improved oversight can foster efficient planning and integration of contractors, benefiting mission success through the optimal use of contracted resources.

Government Agencies

The proposed rule intends to strengthen DoD's alignment with governmental accountability standards, potentially reducing wasteful spending and enhancing oversight of international operations. If successful, these changes could positively reflect on the DoD's contracting practices and fulfill GAO's requirements for removing high-risk designations.

Overall, while the intent and goals of the proposed updates are clear, the practical implications and potential burdens require careful consideration to ensure they align with government objectives and stakeholder capacities.

In reviewing the document concerning Operational Contract Support (OCS) outside the United States, several financial references appear throughout the text that merit discussion. These monetary references are crucial to understanding both the financial impact of the proposed regulatory changes and the potential implications for various stakeholders, including contractors and small businesses.

Spending and Cost Reductions

One of the key financial references in the document is the reported decrease in costs, amounting to $486,283. This reduction is attributed to a decrease in contractor deployments, which have been reduced since 2016. It's worth noting that this cost saving reflects a lowered burden due to fewer contractor responses required, dropping from 93,520 to 74,561.

Contracts with Small Businesses

Another significant financial reference is the allocation of contracts to small businesses. The document reports that approximately $2,438,406,319 of the total $36,747,264,771 in contracts, accounting for less than 8 percent, are obligated to small businesses worldwide. This allocation indicates a considerable volume of business aimed at small entities, which represents about 1 percent of all contract actions, suggesting the planned regulatory changes might impact them.

Financial Impact and Compliance Challenges

The document highlights potential financial issues arising from the requirements imposed on contractors. Specifically, the necessity for contractors to provide verification of medical, dental, and psychological fitness for their employees presents a potential financial challenge. Smaller entities might bear significant costs to comply with these requirements, necessitating further support or evaluation by the Department of Defense (DoD) to facilitate adherence. These challenges underline the importance of a clear understanding of the expected financial commitments for compliance, especially for smaller businesses that might lack the resources of larger contractors.

Lack of Detailed Economic Impact Analysis

Despite these financial references, the document does not provide a detailed cost analysis or projections regarding the financial impact of the proposed changes on contractors, particularly smaller entities. This lack of detailed economic assessment might necessitate additional clarification or justification to ensure that all stakeholders are fully aware of the financial commitments involved.

In summary, the financial references in the document highlight cost savings from decreased contractor deployments, engagement with small businesses, and potential compliance challenges due to new requirements. However, the absence of a detailed financial impact analysis leaves some questions unanswered regarding the overall economic implications of these regulatory changes.