80 FR 42408 - Health Resources Priority and Allocations System (HRPAS)
DEPARTMENT OF HEALTH AND HUMAN SERVICES (HHS) Federal Register Volume 80, Issue 137 (July 17, 2015)
Federal Register Volume 80, Issue 137 (July 17, 2015)
| Page Range | 42408-42423 | |
| FR Document | 2015-17047 |
[Federal Register Volume 80, Number 137 (Friday, July 17, 2015)] [Rules and Regulations] [Pages 42408-42423] From the Federal Register Online [www.thefederalregister.org] [FR Doc No: 2015-17047] ======================================================================= ----------------------------------------------------------------------- DEPARTMENT OF HEALTH AND HUMAN SERVICES (HHS) 45 CFR Part 101 RIN 0991-AB94 Health Resources Priority and Allocations System (HRPAS) AGENCY: Department of Health and Human Services, Office of the Secretary. ACTION: Interim final rule. ----------------------------------------------------------------------- SUMMARY: This interim final rule establishes standards and procedures by which the U.S. Department of Health and Human Services (HHS) may require that certain contracts or orders that promote the national defense be given priority over other contracts or orders. This rule also sets new standards and procedures by which HHS may allocate materials, services, and facilities to promote the national defense. This rule will implement HHS's administration of priorities and allocations actions, and establish the Health Resources Priorities and Allocation System (HRPAS). The HRPAS will cover health resources pursuant to the authority under Section 101(c) of the Defense Production Act as delegated to HHS by Executive Order 13603. Priorities authorities (and other authorities delegated to the Secretary in E.O. 13603, but not covered by this regulation) may be re-delegated by the Secretary. The Secretary retains the authority for allocations. DATES: Effective July 17, 2015. Comments must be received by September 15, 2015. ADDRESSES: You may submit comments, identified by RIN 0991-AB94 by any of the following methods:Federal eRulemaking Portal: http://www.regulations.gov. Follow the instructions for submitting comments. By email directly to [email protected]. By mail or delivery to Cassandra Freeman, Director, Division of Acquisition Policy, Office of the Assistant Secretary for Preparedness and Response, U.S. Department of Health and Human Services, 200 Independence Avenue SW., Room 630G, Washington, DC 20201. Written comments regarding the burden-hour estimates or other aspects of the collection-of-information requirements or any other provisions contained in this interim final rule may [[Page 42409]] be submitted to Cassandra Freeman, Director, Division of Acquisition Policy, Office of the Assistant Secretary for Preparedness and Response, U.S. Department of Health and Human Services, 200 Independence Avenue SW., Room 630G, Washington, DC 20201. FOR FURTHER INFORMATION CONTACT: The agency program contact is Cassandra R. Freeman, who can be contacted by phone at (202) 205-1855 or via email at [email protected]. SUPPLEMENTARY INFORMATION: Background HHS is publishing this rule to comply with a requirement of the Defense Production Act Reauthorization of 2009 (Pub. L. 111-67) (the ``DPAR''). The Defense Production Act Reauthorization of 2009 required that HHS, and all other agencies that previously have been delegated authority to issue rated orders under Executive Order 13603, publish regulations providing standards and procedures for prioritization of contracts and orders and for allocation of materials, services, and facilities to promote the national defense under both emergency and non-emergency conditions. HHS's regulation, along with regulations promulgated by other agencies, will become part of the Federal Priorities and Allocations System. The HRPAS is part of the Federal Priorities and Allocations System. The HRPAS has two principal components: priorities and allocations. Under the priorities component, certain contracts between the government and private parties or between private parties for the production or delivery of industrial resources are required to be given priority over other contracts to facilitate expedited delivery in promotion of the U.S. national defense. Under the allocations component, materials, services, and facilities may be allocated to promote the national defense. For both components, the term ``national defense''' is defined broadly and can include critical infrastructure protection and restoration, emergency preparedness and response, and recovery from natural and man-made disasters. Priorities authorities (and other authorities delegated to the Secretary in E.O. 13603, but not covered by this regulation) may be re-delegated by the Secretary. The Secretary retains the authority for allocations. On September 30, 2009, Congress amended the DPA through the Defense Production Act Reauthorization of 2009 (Pub. L. 111-67) (the ``DPAR''). The DPAR directed, all agencies to which the President has delegated priorities and allocations authority under E.O. 13603, publish final rules establishing standards and procedures by which that authority will be used to promote the national defense in both emergency and nonemergency situations. The DPAR also required all such agencies to consult as appropriate and to the extent practicable to develop a consistent and unified Federal priorities and allocations system. This rule is one of several rules to be published to implement the provisions of the DPAR. The final rules of the agencies with DPAR authorities, which are the Departments of Commerce, Energy, Transportation, Health and Human Services, Defense, and Agriculture, will comprise the Federal Priorities and Allocations System (``FPAS''). HHS is publishing this interim final rule in compliance with the provision of the DPAR noted above. HHS's HRPAS provisions are consistent with the FPAS regulations being issued by other agencies. The specific proposals in this rule are more fully described below. Analysis of the Priorities and Allocations System General Section 101.1 states the purpose of the HRPAS in general terms, as providing guidance and procedures for use of the Defense Production Act (DPA) priorities and allocations authority with respect to health resources necessary or appropriate to promote the national defense. Section 101.2 provides guidance and procedures for the use of the DPA priorities and allocation authority with respect to health resources necessary or appropriate to promote the national defense. Section 101.3 provides an overview of the HRPAS program eligibility. This section describes briefly aspects of the HRPAS, including the certain programs for military and health resources under the DPA. Definitions The ``Definitions'' section appears in Sec. 101.20 and provides definitions for the relevant regulatory terms. Placement of Rated Orders Section 101.30, ``Delegation of Authority,'' describes fully the President's delegations to HHS. It also describes, in general terms, the items subject to HHS's jurisdiction. This provision facilitates public understanding of the role that each delegate agency plays in the overall priorities and allocations system. Section 101.31, ``Priority ratings,'' describes the two possible levels of priority and program identification symbols used when rating an order. Section 101.32, ``Elements of a rated order,'' describes in detail what each rated order must include, consisting of the appropriate priority rating, delivery date information, signatures and required language. HHS seeks comment specifically on the text of this provision. Section 101.33, ``Acceptance and rejection of rated orders,'' details when orders placed by HHS may or must be accepted or rejected, and what the procedures are for both, including customer notification requirements and certain exceptions for emergency preparedness conditions. Specifically, persons must accept or reject rated orders for emergency response-related approved programs within fifteen (15) working days (or ten (10) working days, depending on the circumstance). HHS requires the shorter time limit in for the recipient to respond to a rated order issued in connection with an emergency response because such orders would require a shorter time frame to ensure delivery in time to provide disaster assistance, emergency response or similar activities. HHS believes that the exigent circumstances inherent in such activities justify requiring a shorter response time. Section 101.34, ``Preferential scheduling,'' details procedures in cases where a person receives two or more conflicting rated orders. If a person is unable to resolve such a conflict, this section refers them to special priorities assistance as provided in Sec. Sec. 101.40 through 101.44. Section 101.35, ``Extension of priority ratings,'' requires a person to use rated orders with suppliers to obtain items or services needed to fill a rated order. This allows the priority rating to ``extend'' from contractor to subcontractor to supplier throughout the entire procurement chain. Section 101.36, ``Changes or cancellations of priority ratings and rated orders,'' provides procedures for changing or cancelling a rated order, both by HHS or other persons who placed the order. Section 101.37, ``Use of rated orders,'' lists what items must be rated. It also introduces the use of certain program identification symbols used when rated orders may be combined, and details the procedures for combining two or more rated orders, as well as rated and unrated orders. Section 101.38, ``Limitations on placing rated orders,'' prohibits the use of rated orders in a list of specific circumstances. This section also [[Page 42410]] specifically excludes the use of rated orders for resources within the resource jurisdiction of agencies other than HHS with DPA priorities and allocations authority. Special Priorities Assistance Section 101.40, ``General provisions'' illustrates when and how HHS can provide special priorities assistance, and provides specific HHS points of contact and the form to be used for requesting such assistance. Special priorities assistance may generally be requested for any reason. Section 101.41, ``Requests for priority rating authority,'' directs persons to the Department of Commerce to request rating authority for production or construction equipment. This section also identifies circumstances in which HHS may authorize a person to place a priority rating on an order to a supplier in advance of the issuance of a rated prime contract, and lists factors HHS will consider in deciding whether to grant this authority. Section 101.42, ``Examples of assistance,'' provides a number of examples of when special priorities assistance may be provided, although it may generally be provided for any reason. Section 101.43 lists the criteria for granting assistance, and Sec. 101.44 lists instances in which assistance may not be provided (i.e., to secure a price advantage). Allocation Actions Sections 101.50 through 101.52 describe allocations and contain procedures for the use of allocation orders. Specifically, allocation orders will be used only if priorities authority will not provide a sufficient supply of material, services or facilities for national defense requirements, or when use of priorities authority will cause a severe and prolonged disruption in the supply of resources available to support normal U.S. economic activities. Allocation orders will not be used to ration materials or services at the retail level. Allocation orders will be distributed equitably among the suppliers of the resource(s) being allocated and will not require any person to relinquish a disproportionate share of the civilian market. The standards set forth in Sec. Sec. 101.50 through 101.52 provide reasonable assurance that allocation orders will be used only in situations where the circumstances justify such orders. Section 101.53 describes the three types of allocation orders that HHS might issue. The types of allocation orders are a set-aside, an allocation directive, and an allotment. A set-aside is an official action that will require a person to reserve resource capacity in anticipation of receipt of rated orders. An allocation directive is an official action that will require a person to take or refrain from taking certain actions in accordance with its provisions (an allocation directive can require a person to stop or reduce production of an item, prohibit the use of selected items, divert supply of one type of product to another, or to supply a specific quantity, size, shape, and type of an item within a specific time period). An allotment is an official action that will specify the maximum quantity of an item authorized for use in a specific program or application. HHS is requiring these three types of allocation orders because it believes that, collectively, they describe the types of actions that might be taken in any situation in which allocation is justified. Section 101.54, ``Elements of an allocation order,'' sets forth the minimum elements of an allocation order. Those elements are: A detailed description of the required allocation action(s); Specific start and end calendar dates for each required allocation action; The written signature on a manually placed order, or the digital signature or name on an electronically placed order, of the Secretary of Health and Human Services or his/her designee, which certifies that the order is authorized under this regulation and that the order is consistent with requirements of the regulation; A statement that reads in substance: This is an allocation order certified for national defense use. [Insert the legal name of the person receiving the order] is required to comply with this order, in accordance with the provisions of the Health Resources Priorities and Allocations System regulation (45 CFR 101.1), which is part of the Federal Priorities and Allocations System; and A current copy of the HRPAS. HHS rquires these elements because it believes that they provide a proper balance between the need for standards to permit the public to recognize and understand an allocation order if one is issued, and the expectation that any actual allocation orders will have to be tailored to meet unforeseeable circumstances. The language of Sec. 101.54 precludes HHS from including additional information in an allocation order if circumstances warrant doing so. Section 101.55, ``Mandatory acceptance of allocation orders,'' requires that an allocation order must be accepted if a person is capable of fulfilling the order. If a person is unable to comply fully with the required actions specific in an allocation order, the person must notify HHS immediately, explain the extent to which compliance is possible, and give reasons why full compliance is not possible. This section also states that a person may not discriminate against an allocation order in any manner, such as by charging higher prices or imposing terms and conditions different than what the person imposed on contracts or orders for the same resource(s) that were received prior to receiving the allocation order. Section 101.55 makes it clear to the public that the limited circumstances and emergency situations that trigger issuance of an allocation order require immediate response from the public in order to address the situation in an expedient fashion. Section 101.56, ``Changes or cancellations of an allocation order'' provides that an allocation order may be changed or cancelled by HHS. Official Actions Section 101.60, ``General Provisions'', provides HHS and overview regarding implementation of this subpart. Section 101.61, ``Rating Authorizations,'' defines a rating authorization as an official action granting specific priority rating authority, and refers persons to Sec. 101.21 to request such priority rating authority. Section 101.62, ``Directives,'' defines a directive as an official action that requires a person to take or refrain from taking certain actions in accordance with its provisions. This section details directive compliance for the public. Section 101.63, ``Letters and Memoranda of Understanding,'' defines a letter or memorandum of understanding as an official action that may be issued in resolving special priorities assistance cases to reflect an agreement reached by all parties, and explains its use. Compliance Section 101.70, ``General Provisions'' details the official actions which may be taken by HHS to enforce or administer the DPA and other applicable statutes. Section 101.71, ``Audits and investigations,'' details the procedures for official examinations of books, records, documents, and other writings and information to ensure that the provisions of the DPA and other applicable statutes, this regulation, and official actions have been properly followed. An audit or investigation may also include interviews and a systems evaluation to detect problems or failures in the implementation of this regulation. [[Page 42411]] Section 101.72, ``Compulsory process,'' provides that if a person refuses to permit a duly authorized HHS representative to have access to necessary information, HHS may seek the institution of appropriate legal action, including ex parte application for an inspection warrant, in any forum of appropriate jurisdiction. Sections 101.73 and 101.74 both provide procedures for notification of failure to comply with the DPA, these regulations, or HHS official actions, and describe the resulting penalties and remedies. Section 101.75, ``Compliance Conflicts,'' requires that persons immediately contact HHS should compliance with the DPA, these regulations, or an official action prevent a person from filling a rated order or from complying with another provision of the DPA and other applicable statutes, this regulation, or an official action. Adjustments, Exceptions, and Appeals Section 101.80, ``Adjustments, Exceptions, and Appeals,'' reflects the procedures necessary to request an adjustment or exception to the provisions of these regulations. Section 101.81, ``Appeals,'' provides the procedures, timing and contact information for appealing a decision made on a request for relief in the previous section. Miscellaneous Provisions Section 101.90, ``Protection against claims,'' provides that a person shall not be held liable for damages or penalties for any act or failure to act resulting directly or indirectly from compliance with any part of this regulation or an official action. Section 101.91, ``Records and reports,'' requires that persons are required to make and preserve for at least three years, accurate and complete records of any transaction covered by this regulation or an official action. Various requirements and procedures regarding such records are provided in this section. The confidentiality provisions of the DPA governing the submission of information pursuant to the DPA and these regulations are also set forth. Section 101.92, ``Applicability of this regulation and official actions,'' provides the jurisdictional applicability of this regulation and official actions. Section 101.93, ``Communications,'' provides a HHS point of contact for all communications regarding this regulation. A. Review Under Executive Order 12866 and Executive Order 13563 HHS has examined the impacts of the interim final rule under Executive Order 12866 and Executive Order 13563. Executive Orders 12866 and 13563 direct agencies to assess all costs and benefits of available regulatory alternatives and, when regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety, and other advantages; distributive impacts; and equity). This rule is not an economically significant regulatory action under Executive Order 12866. A summary of the cost benefit analysis is provided below. This rule sets criteria under which HHS (or agencies to which HHS delegates HHS's DPA authority to issue rated orders) will authorize prioritization of certain orders or contracts as well as criteria under which HHS will issue orders allocating resources or production facilities. To date, HHS has minimally exercised its prioritization authority for contracts during the response to H1N1 influenza in 2009 to order ancillary supplies in support of the Centers for Disease Control and Prevention's (CDC) Immunization Program, and not exercised its existing allocations authority. Under prioritization, HHS or its Delegate Agency designates certain orders as one of two possible priority levels. Once so designated, such orders are referred to as ``rated orders.'' The recipient of a rated order must give it priority over an unrated order or an order with a lower priority rating. A recipient of a rated order may place orders at the same priority level with suppliers and subcontractors for supplies and services necessary to fulfill the recipient's rated order and the suppliers and subcontractors must treat the request from the rated order recipient as a rated order with the same priority level as the original rated order. The rule does not require recipients to fulfill rated orders if the price or terms of sale are not consistent with the price or terms of sale of similar non-rated orders. The rule provides a defense from any liability for damages or penalties for actions taken in or inactions required for, compliance with the rule. The impact of HRPAS on private companies receiving priority orders is expected to vary. However, in most cases, there is likely to be no economic impact in filling priority orders because it will generally just be changing the timing in which orders are completed. HRPAS is expected to have an overall positive impact on the U.S. public and industry by maintaining and restoring the production, processing, storage, and distribution of health resources during times of both emergency and nonemergency conditions to promote national defense and to prevent civilian hardship in the food marketplace. While HHS has not yet administered HRPAS under DPA authority, the continued use of DPAS by the Department of Defense proves the utility of a priorities and allocations system. B. Review Under the Regulatory Flexibility Act The Regulatory Flexibility Act (5 U.S.C. 601 et seq.) requires preparation of an initial regulatory flexibility analysis for any rule that by law must be proposed for public comment, unless the agency certifies that the rule, if promulgated, will not have a significant economic impact on a substantial number of small entities. HHS reviewed this interim final rule under the provisions of the Regulatory Flexibility Act and has determined that this rule, if promulgated, will not have a significant impact on a substantial number of small entities. Number of Small Entities Small entities include small businesses, small organizations and small governmental jurisdictions. For purposes of assessing the impacts of this interim final rule on small entities, a small business, as described in the Small Business Administration's Table of Small Business Size Standards Matched to North American Industry Classification System Codes (January 2012 Edition), has a maximum annual revenue of $33.5 million and a maximum of 1,500 employees (for some business categories, these number are lower). A small governmental jurisdiction is a government of a city, town, school district or special district with a population of less than 50,000. A small organization is any not-for-profit enterprise which is independently owned and operated and is not dominant in its field. This rule sets criteria under which HHS (or agencies to which HHS delegates HHS's DPA authority to issue rated orders) will authorize prioritization of certain orders or contracts as well as criteria under which HHS will issue orders allocating resources or production facilities. Because the rule affects commercial transactions, HHS believes that small organizations and small governmental jurisdictions are unlikely to be affected by this rule. To date, HHS has [[Page 42412]] minimally exercised its prioritization authority for contracts during the response to 2009 H1N1 influenza to order ancillary supplies in support of HHS/CDC's Immunization Program, and not exercised its existing allocations authority. As such, HHS has no basis on which to estimate the number of small businesses that may be affected by this rule. Impact The interim final rule has two principle components: prioritization and allocation. Under prioritization, HHS, or its Delegate Agency, designates certain orders as one of two possible priority levels. Once so designated, such orders are referred to as ``rated orders.'' The recipient of a rated order must give it priority over an unrated order or an order with a lower priority rating. A recipient of a rated order may place orders at the same priority level with suppliers and subcontractors for supplies and services necessary to fulfill the recipient's rated order and the suppliers and subcontractors must treat the request from the rated order recipient as a rated order with the same priority level as the original rated order. The rule does not require recipients to fulfill rated orders if the price or terms of sale are not consistent with the price or terms of sale of similar non- rated orders. The rule provides a defense from any liability for damages or penalties for actions taken in or inactions required for, compliance with the rule. Although rated orders could require a firm to fill one order prior to filling another, they will not necessarily require a reduction in the total volume of orders. The regulations will also not require the recipient of a rated order to reduce prices or provide rated orders with more favorable terms than a similar non-rated order. Under these circumstances, the economic effects on the rated order recipient of substituting one order for another are likely to be mutually offsetting, resulting in no net economic impact. Allocations could be used to control the general distribution of materials or services in the civilian market. Specific allocation actions that HHS might take are as follows: Set-aside: an official action that requires a person to reserve resource capacity in anticipation of receipt of rated orders. Allocations directive: an official action that requires a person to take or refrain from taking certain actions in accordance with its provisions. An allocation directive can require a person to stop or reduce production of an item, prohibit the use of selected items, or divert supply of one type of product to another, or to supply a specific quantity, size, shape, and type of an item within a specific time period. Allotment: an official action that specifies the maximum quantity of an item authorized for use in a specific program or application. HHS has not yet taken any actions under its existing allocations authority, and any future allocations actions would be used only in extraordinary circumstances. As required by section 101(b) of the Defense Production Act of 1950, as amended, (50 U.S.C. App. Sec. 2071), hereinafter ``DPA,'' and by Section 201(a) (3) of Executive Order 13603, HHS may implement allocations only if the Secretary of Health and Human Services makes, and the President approves, and determines that there is a scarcity of critical materials and services essential to the national defense, and that the requirements of the national defense cannot otherwise be met without a significant interruption of normal distribution of these essential materials or services in the civilian marketplace that would cause considerable hardship. ``National defense'' covers programs for military and health resources production or construction, military or critical infrastructure assistance to any foreign nation, homeland security, stockpiling, space, and any related activity. Such term includes emergency preparedness activities conducted pursuant to title VI of the Robert T. Stafford Disaster Relief and Emergency Assistance Act (42 U.S.C. 5195 et seq.) and critical infrastructure protection and restoration. Any allocation actions taken by HHS must assure that small business concerns shall be accorded, to the extent practicable; a fair share of the materials or services covered by the allocation action in proportion to the share received by small business concerns under normal conditions, giving such special consideration as may be possible to emerging business concerns, 50 U.S.C. App. Sec. 2151(e). Conclusion Although HHS cannot determine precisely the number of small entities that will be affected by this rule, HHS believes that the overall impact on such entities will not be significant. In most instances, rated contracts will be fulfilled in addition to other (unrated) contracts and, in some instances might actually increase the total amount of business of the firm that receives a rated contract. Because allocations can be imposed only after an agency determination confirmed by the President, and because HHS has not yet used its allocations authority that has existed since passage of the Defense Production Act in 1950, one can expect allocations will be ordered only in particular circumstances. Any allocation actions would also have to comply with Section 701(e) of DPA (50 U.S.C. app. 2151(e)), which provides that small business concerns be accorded, to the extent practicable, a fair share of the material, including services, in proportion to the share received by such business concerns under normal conditions, giving such special consideration as may be possible to emerging business concerns. Therefore, HHS believes that the requirement for a Presidential determination and the provisions of section 701 of the DPA indicate that any impact on small business will not be significant. Therefore, for the reasons set forth above, the Secretary of the Department of Health and Human Services certifies that this interim final rule will not have a significant economic impact on a substantial number of small entities. C. Review Under the Paperwork Reduction Act This interim final rule contains a collection-of-information requirement for Request for Special Priorities Assistance, which is subject to review and approval by OMB under the Paperwork Reduction Act (PRA). This requirement has been submitted to OMB for approval. Data required will include: name, location, contact information, items for which the applicant is requesting assistance on, quantity, and delivery date. Public reporting burden for submission of a request for special priorities assistance or priority rating authority is estimated to average 30 minutes per response, including the time for reviewing instructions, searching existing data sources, gathering and maintaining the data needed, and completing and reviewing the collection of information. Public comment is sought regarding: whether this collection of information is necessary for the proper performance of the functions of the agency, including whether the information shall have practical utility; the accuracy of the burden estimate; ways to enhance the quality, utility, and clarity of the information to be collected; and ways to minimize the burden of the collection of information, including through the use of automated collection techniques or other forms of information technology. Send comments on these or any other aspects of the collection of information [[Page 42413]] to (see [email protected], Office of the Assistant Secretary for Preparedness and Response, U.S. Department of Health and Human Services, 200 Independence Avenue SW., Room 630G, Washington, DC 20201). Notwithstanding any other provision of the law, no person is required to respond to, nor shall any person be subject to a penalty for failure to comply with, a collection of information subject to the requirements of the PRA, unless that collection of information displays a currently valid OMB Control Number. Title: Request for Special Priorities Assistance for HRPAS. OMB Control Number: To be provided by OMB. Type of Request: New Collection. Abstract: HRPAS will efficiently place priority ratings on contracts or orders of health resources within its authority as specified in the Defense Production Act (DPA) of 1950, as amended, when necessary. Applicants (Government agencies or private individuals with a role in emergency preparedness, response, and recovery functions) will request authorization from HHS to place a rating on a contract for items to support national defense activities. Applicants must supply, at time of request, their name, location, contact information, items for which the applicant is requesting assistance on, quantity, and delivery date. Applicants can submit the request by mail or fax. Estimate of Burden: Public reporting for this collection of information is estimated to average 30 minutes per response. Type of Respondents: Individuals, businesses, and Agencies with responsibilities for emergency preparedness and response. Estimated Number of Respondents: 100. Estimated Number of Responses per Respondents: 0.95. Estimated Total Number of Respondents: 95. Estimate Total Annual Burden Hours on Respondents: 50 hours. We are requesting comments on all aspects of this information collection to help us: (1) Evaluate whether the collection of information is necessary for the proper performance of the functions of HHS, including whether the information will have practical utility; (2) Evaluate the accuracy of HHS's estimate of burden including the validity of the methodology and assumptions used; (3) Enhance the quality, utility and clarity of the information to be collected; (4) Minimize the burden of the collection of information on those who are to respond, including through the use of appropriate automated, electronic, mechanical, or other technological collection techniques or other forms of information technology. All comments received in response to this document, including names and addresses when provided, will be a matter of public record. Comments will be summarized and included in the submission for Office of Management and Budget approval. D. Review Under Executive Order 13132 HHS reviewed this rule pursuant to Executive Order 13132, ``Federalism,'' 64 FR 43255 (August 4, 1999), which imposes certain requirements on agencies formulating and implementing policies or regulations that preempt State law or that have federalism implications. HHS determined that the rule will not have a substantial direct effect on the States, on the relationship between the National Government and the States, or on the distribution of power and responsibilities among the various levels of Government. E. Review Under Unfunded Mandates Reform Act Title II of the Unfunded Mandate Reform Act of 1995 (UMRA, Pub. L. 104-4) requires Federal agencies to assess the effects of their regulatory actions on State, local, or Tribal governments or the private sector. Agencies generally must prepare a written statement, including a cost benefit analysis, for proposed and final rules with Federal mandates that may result in expenditures of $100 million or more in any one year for State, local, or Tribal governments, in the aggregate, or to the private sector. This rule contains no Federal mandates as defined by Title II of UMRA for State, local, or Tribal governments or for the private sector; therefore, this rule is not subject to the requirements of sections 202 and 205 of UMRA. F. Approval of the Office of the Secretary The Secretary of Health and Human Services has approved publication of this interim final rule. List of Subjects in 45 CFR Part 101 Administrative practice and procedure, Business and industry, Government contracts, National defense, Reporting and recordkeeping requirements, Strategic and critical materials. For the reasons stated in the preamble, HHS adds part 101 to subchapter A of title 45 of the Code of Federal Regulations to read as follows: PART 101--DESCRIBING AGENCY NEEDS Subpart A--Health Resources Priorities and Allocations System General Sec. 101.1 Purpose. 101.2 Priorities and allocations authority. 101.3 Program eligibility. Subpart B--Definitions 101.20 Definitions. Subpart C--Placement of Rated Orders 101.30 Delegations of authority. 101.31 Priority ratings. 101.32 Elements of a rated order. 101.33 Acceptance and rejection of rated orders. 101.34 Preferential scheduling. 101.35 Extension of priority ratings. 101.36 Changes or cancellations of priority ratings and rated orders. 101.37 Use of rated orders. 101.38 Limitations on placing rated orders. Subpart D--Special Priorities Assistance 101.40 General provisions. 101.41 Requests for priority rating authority. 101.42 Examples of assistance. 101.43 Criteria for assistance. 101.44 Instances where assistance may not be provided. Subpart E--Allocation Actions 101.50 Policy. 101.51 General procedures. 101.52 Controlling the general distribution of a material in the civilian market. 101.53 Types of allocation orders. 101.54 Elements of an allocation order. 101.55 Mandatory acceptance of an allocation order. 101.56 Changes or cancellations of an allocation order. Subpart F--Official Actions 101.60 General provisions. 101.61 Rating Authorizations. 101.62 Directives. 101.63 Letters and Memoranda of Understanding. Subpart G--Compliance 101.70 General provisions. 101.71 Audits and investigations. 101.72 Compulsory process. 101.73 Notification of failure to comply. 101.74 Violations, penalties, and remedies. 101.75 Compliance conflicts. Subpart H--Adjustments, Exceptions, and Appeals 101.80 Adjustments or exceptions. 101.81 Appeals. Subpart I--Miscellaneous Provisions 101.90 Protection against claims. 101.91 Records and reports. 101.92 Applicability of this part and official actions. 101.93 Communications. Authority: 50 U.S.C. App. 2061-2171; [[Page 42414]] Subpart A--Health Resources Priorities and Allocations System General Sec. 101.1 Purpose. This section provides guidance and procedures for use of Defense Production Act (DPA) of 1950 Section 101(a) priorities and allocations authority with respect to all forms of health resources necessary or appropriate to promote the national defense. The guidance and procedures in this part are consistent with the guidance and procedures provided in other regulations that, as a whole, form the Federal Priorities and Allocations System. Guidance and procedures for use of the DPA priorities and allocations authority with respect to other types of resources are provided for: food resources, food resource facilities, and the domestic distribution of farm equipment and commercial fertilizer in7 CFR part 700; energy supplies in 10 CFR part 217; all forms of civil transportation in 49 CFR part 33; water resources in 32 CFR part 555; and all other materials, services, and facilities, including construction materials in the Defense Priorities and Allocations System (DPAS) regulation (15 CFR part 700). Sec. 101.2 Priorities and allocations authority. (a) Section 201 of E.O. 13603, delegates the President's authority under Section 101 of the DPA. DPA Section 101 provides the President with authority to require acceptance and priority performance of contracts and orders (other than contracts of employment) to promote the national defense over performance of any other contracts or orders, and to allocate materials, services, and facilities as deemed necessary or appropriate to promote the national defense to a number of agencies. Section 201 of E.O. 13603 delegates the President's authority to specific agencies as follows: (1) The Secretary of Agriculture with respect to food resources, food resource facilities, livestock resources, veterinary resources, plant health resources, and the domestic distribution of farm equipment and commercial fertilizer; (2) The Secretary of Energy with respect to all forms of energy; (3) The Secretary of Health and Human Services with respect to health resources; (4) The Secretary of Transportation with respect to all forms of civil transportation; (5) The Secretary of Defense with respect to water resources; and (6) The Secretary of Commerce for all other materials, services, and facilities, including construction materials. (b) Section 202(a) of E.O. 13603 states that the priorities and allocations authority delegated in Section 201 of that Executive Order may be used only to support programs that have been determined in writing as necessary or appropriate to promote the national defense: (1) By the Secretary of Defense with respect to military production and construction, military assistance to foreign nations, military use of civil transportation, stockpiles managed by the Department of Defense, space, and directly related activities; (2) By the Secretary of Energy with respect to energy production and construction, distribution and use, and directly related activities; and (3) By the Secretary of Homeland Security with respect to all other national defense programs, including civil defense and continuity of Government. (c) Section 201(e) of E.O. 13603 provides that each department that is delegated priorities and allocations authority under Section 201(a) of E.O. 13603 may use this authority with respect to control of the general distribution of any material (including applicable services) in the civilian market only after: (1) Making the finding required under Section 101(b) of the DPA; and (2) The finding has been approved by the President. (d) Priorities authorities (and other authorities delegated to the Secretary in E.O. 13603 but not covered by this regulation) have been re-delegated by the Secretary to the Assistant Secretary for Preparedness and Response (the ``ASPR''). The Secretary retains the authority for allocations. Sec. 101.3 Program eligibility. Certain programs to promote the national defense are eligible for priorities and allocations support. These include programs for military and energy production or construction, military or critical infrastructure assistance to any foreign nation, deployment and sustainment of military forces, homeland security, stockpiling, space, and any directly related activity. Other eligible programs include emergency preparedness activities conducted pursuant to Title VI of the Robert T. Stafford Disaster Relief and Emergency Assistance Act [42 U.S.C. 5195 et seq.] and critical infrastructure protection and restoration. Subpart B--Definitions Sec. 101.20 Definitions. The following definitions pertain to all sections of this part: Allocation means the control of the distribution of materials, services, or facilities for a purpose deemed necessary or appropriate to promote the national defense. Allocation order means an official action to control the distribution of materials, services, or facilities for a purpose deemed necessary or appropriate to promote the national defense. Allotment means an official action that specifies the maximum quantity or use of a material, service, or facility authorized for a specific use to promote the national defense. Approved program means a program determined by the Secretary of Defense, the Secretary of Energy, or the Secretary of Homeland Security to be necessary or appropriate to promote the national defense, in accordance with Section 202 of E.O. 13603. Construction means the erection, addition, extension, or alteration of any building, structure, or project, using materials or products which are to be an integral and permanent part of the building, structure, or project. Construction does not include maintenance and repair. Critical infrastructure means any systems and assets, whether physical or cyber-based, so vital to the United States that the degradation or destruction of such systems and assets would have a debilitating impact on national security, including, but not limited to, national economic security and national public health or safety. Defense Production Act or DPA means the Defense Production Act of 1950, as amended (50 U.S.C. App. 2061 et seq.). Delegate agency means a Federal government agency authorized by delegation from HHS to place priority ratings on contracts or orders needed to support approved programs. Directive means an official action that requires a person to take or refrain from taking certain actions in accordance with its provisions. Emergency preparedness means all those activities and measures designed or undertaken to prepare for or minimize the effects of a hazard upon the civilian population, to deal with the immediate emergency conditions which would be created by the hazard, and to effectuate emergency repairs to, or the emergency restoration of, vital utilities and facilities destroyed or damaged by the hazard. ``Emergency Preparedness'' includes the following: (1) Measures to be undertaken in preparation for anticipated hazards (including the establishment of appropriate organizations, operational plans, and supporting agreements, the [[Page 42415]] recruitment and training of personnel, the conduct of research, the procurement and stockpiling of necessary materials and supplies, the provision of suitable warning systems, the construction or preparation of shelters, shelter areas, and control centers, and, when appropriate, the nonmilitary evacuation of the civilian population). (2) Measures to be undertaken during a hazard (including the enforcement of passive defense regulations prescribed by duly established military or civil authorities, the evacuation of personnel to shelter areas, the control of traffic and panic, and the control and use of lighting and civil communications). (3) Measures to be undertaken following a hazard (including activities for firefighting; rescue; emergency medical, health and sanitation services; monitoring for specific dangers of special weapons; unexploded bomb reconnaissance; essential debris clearance; emergency welfare measures; and immediately essential emergency repair or restoration of damaged vital facilities). Facilities includes all types of buildings, structures, or other improvements to real property (but excluding farms, churches or other places of worship, and private dwelling houses), and services relating to the use of any such building, structure, or other improvement. Farm equipment means equipment, machinery, and repair parts manufactured for use on farms in connection with the production or preparation for market use of Food resources. Fertilizer means any product or combination of products that contain one or more of the elements--nitrogen, phosphorus, and potassium--for use as a plant nutrient. Food resources means all commodities and products, (simple, mixed, or compound), or complements to such commodities or products, that are capable of being ingested by either human beings or animals, irrespective of other uses to which such commodities or products may be put, at all stages of processing from the raw commodity to the products thereof in vendible form for human or animal consumption. ``Food Resources'' also means potable water packaged in commercially marketable containers, all starches, sugars, vegetable and animal or marine fats and oils, seed, cotton, hemp, and flax fiber, but does not mean any such material after it loses its identity as an agricultural commodity or agricultural product. Food resource facilities means plants, machinery, vehicles (including on-farm), and other facilities required for the production, processing, distribution, and storage (including cold storage) of food resources, and for the domestic distribution of farm equipment and fertilizer (excluding transportation thereof). Hazard means an emergency or disaster resulting from: (1) A natural disaster; or (2) An accidental or human-caused event. Health resources means drugs, biological products, medical devices, materials, facilities, health supplies, services and equipment required to diagnose, mitigate or prevent the impairment of, improve, treat, cure, or restore the physical or mental health conditions of the population. Homeland Security includes efforts-- (1) To prevent terrorist attacks within the United States; (2) To reduce the vulnerability of the United States to terrorism; (3) To minimize damage from a terrorist attack in the United States; and (4) To recover from a terrorist attack in the United States. Industrial Resource means all materials, services, and facilities, including construction materials, but not including: Food resources, food resource facilities, and the domestic distribution of farm equipment and commercial fertilizer; all forms of health resources; all forms of civil transportation; and water resources. Item means any raw, in process, or manufactured material, article, commodity, supply, equipment, component, accessory, part, assembly, or product of any kind, technical information, process, or service. Maintenance and Repair and Operating Supplies (MRO) includes the following-- (1) ``Maintenance'' is the upkeep necessary to continue any plant, facility, or equipment in working condition. (2) ``Repair'' is the restoration of any plant, facility, or equipment to working condition when it has been rendered unsafe or unfit for service by wear and tear, damage, or failure of parts. (3) ``Operating Supplies'' are any resources carried as operating supplies according to a person's established accounting practice. ``Operating Supplies'' may include hand tools and expendable tools, jigs, dies, fixtures used on production equipment, lubricants, cleaners, chemicals and other expendable items. (4) MRO does not include items produced or obtained for sale to other persons or for installation upon or attachment to the property of another person, or items required for the production of such items; items needed for the replacement of any plant, facility, or equipment; or items for the improvement of any plant, facility, or equipment by replacing items which are still in working condition with items of a new or different kind, quality, or design. Materials includes-- (1) Any raw materials (including minerals, metals, and advanced processed materials), commodities, articles, components (including critical components), products, and items of supply; (2) Any technical information or services ancillary to the use of any such materials, commodities, articles, components, products, or items; and (3) Natural resources such as oil and gas. National defense means programs for military and health resources production or construction, military or critical infrastructure assistance to any foreign nation, homeland security, stockpiling, space, and any directly related activity. Such term includes emergency preparedness activities conducted pursuant to title VI of the Robert T. Stafford Disaster Relief and Emergency Assistance Act (42 U.S.C. 5195, et seq.) and critical infrastructure protection and restoration. Official action means an action taken by the Department of Health and Human Services or another resource agency under the authority of the Defense Production Act, E.O.13603, and this part or another regulation under the Federal Priorities and Allocations System. Such actions include the issuance of Rating Authorizations, Directives, Set Asides, Allotments, Letters of Understanding, Memoranda of Understanding, and Demands for Information, Inspection Authorizations, and Administrative Subpoenas. Person includes an individual, corporation, partnership, association, or any other organized group of persons, or legal successor or representative thereof, or any State or local government or agency thereof. Rated order means a prime contract, a subcontract, or a purchase order in support of an approved program issued in accordance with the provisions of this part. Resource agency means any agency delegated priorities and allocations authority as specified in Sec. 101.2. Secretary means the Secretary of Health and Human Services. Services includes any effort that is needed for or incidental to-- [[Page 42416]] (1) The development, production, processing, distribution, delivery, or use of an industrial resource or a critical technology item; (2) The construction of facilities; (3) The movement of individuals and property by all modes of civil transportation; or (4) Other national defense programs and activities. Set-aside means an official action that requires a person to reserve materials, services, or facilities capacity in anticipation of the receipt of rated orders. Stafford Act means title VI (Emergency Preparedness) of the Robert T. Stafford Disaster Relief and Emergency Assistance Act, as amended (42 U.S.C. 5195-5197h). Water resources means all usable water, from all sources, within the jurisdiction of the United States, that can be managed, controlled, and allocated to meet emergency requirements, except ``water resources does not include usable water that qualifies as ``food resources''. Subpart C--Placement of Rated Orders Sec. 101.30 Delegations of authority. The priorities and allocations authorities of the President under Title I of the DPA with respect to all forms of health resources have been delegated to the Secretary under E.O. 13603. The Secretary may re- delegate the Secretary's priority rating activities under the DPA though the allocations authority provided to the Secretary is not subject to delegation per Section 201(e) of E.O. 13603. Sec. 101.31 Priority ratings. (a) Levels of priority. (1) There are two levels of priority established by Federal Priorities and Allocations System regulations, identified by the rating symbols ``DO'' and ``DX''. (2) All DO-rated orders have equal priority with each other and take precedence over unrated orders. All DX-rated orders have equal priority with each other and take precedence over DO-rated orders and unrated orders. (For resolution of conflicts among rated orders of equal priority, see Sec. 101.34(c).) (3) In addition, a Directive regarding priority treatment for a given item issued by the Department of Health and Human Services for that item takes precedence over any DX-rated order, DO-rated order, or unrated order, as stipulated in the Directive. (For a full discussion of Directives, see Sec. 101. 62. (b) Program identification symbols. Program identification symbols, such as ``DO-HR'', or ``DX-HR'', indicate which approved program is being supported by a rated order. Programs may be approved under the procedures of E.O. 13603 Section 202 at any time. Program identification symbols do not connote any priority. (c) Priority ratings. A priority rating consists of the rating symbol--DO or DX--and the program identification symbol, such as DO-HR or DX-HR. Sec. 101.32 Elements of a rated order. Each rated order must include: (a) The appropriate priority rating (e.g. DO-HR or DX-HR); (b) A required delivery date or dates. The words ``immediately'' or ``as soon as possible'' do not constitute a delivery date. A ``requirements contract'', ``basic ordering agreement'', ``prime vendor contract'', or similar procurement document bearing a priority rating may contain no specific delivery date or dates and may provide for the furnishing of items or service from time-to-time or within a stated period against specific purchase orders, such as ``calls'', ``requisitions'', and ``delivery orders''. These purchase orders must specify a required delivery date or dates and are to be considered as rated as of the date of their receipt by the supplier and not as of the date of the original procurement document; (c) The written signature on a manually placed order, or the digital signature or name on an electronically placed order, of an individual authorized to sign rated orders for the person placing the order. The signature or use of the name certifies that the rated order is authorized under this part and that the requirements of this part are being followed; and (d)(1) A statement that reads in substance: This is a rated order certified for national defense use, and you are required to follow all the provisions of the Health Resources Priorities and Allocations System regulation at 45 CFR part 101. (2) If the rated order is placed in support of emergency preparedness requirements and expedited action is necessary and appropriate to meet these requirements, the following sentences should be added following the statement set forth in paragraph (d)(1) of this section: (i) This rated order is placed for the purpose of emergency preparedness. It must be accepted or rejected within two (2) days after receipt of the order if: (A) The order is issued in response to a hazard that has occurred; or (B) If the order is issued to prepare for an imminent hazard, as specified in HRPAS Sec. 101.33(e). (ii) [Reserved] Sec. 101.33 Acceptance and rejection of rated orders. (a) Mandatory acceptance. (1) Except as otherwise specified in this section, a person shall accept every rated order received and must fill such orders regardless of any other rated or unrated orders that have been accepted. (2) A person shall not discriminate against rated orders in any manner such as by charging higher prices or by imposing different terms and conditions than for comparable unrated orders. (b) Mandatory rejection. Unless otherwise directed by HHS for a rated order involving all forms of health resources: (1) A person shall not accept a rated order for delivery on a specific date if unable to fill the order by that date. However, the person must inform the customer of the earliest date on which delivery can be made and offer to accept the order on the basis of that date. Scheduling conflicts with previously accepted lower rated or unrated orders are not sufficient reason for rejection under this section. (2) A person shall not accept a DO-rated order for delivery on a date which would interfere with delivery of any previously accepted DO- or DX-rated orders. However, the person must offer to accept the order based on the earliest delivery date otherwise possible. (3) A person shall not accept a DX-rated order for delivery on a date which would interfere with delivery of any previously accepted DX- rated orders, but must offer to accept the order based on the earliest delivery date otherwise possible. (4) If a person is unable to fill all of the rated orders of equal priority status received on the same day, the person must accept, based upon the earliest delivery dates, only those orders which can be filled, and reject the other orders. For example, a person must accept order A requiring delivery on December 15 before accepting order B requiring delivery on December 31. However, the person must offer to accept the rejected orders based on the earliest delivery dates otherwise possible. (c) Optional rejection. Unless otherwise directed by HHS for a rated order involving all forms of health resources, rated orders may be rejected in any of the following cases as long as a supplier does not discriminate among customers: (1) If the person placing the order is unwilling or unable to meet regularly established terms of sale or payment; (2) If the order is for an item not supplied or for a service not capable of being performed; [[Page 42417]] (3) If the order is for an item or service produced, acquired, or provided only for the supplier's own use for which no orders have been filled for two years prior to the date of receipt of the rated order. If, however, a supplier has sold some of these items or provided similar services, the supplier is obligated to accept rated orders up to that quantity or portion of production or service, whichever is greater, sold or provided within the past two years; (4) If the person placing the rated order, other than the U.S. Government, makes the item or performs the service being ordered; (5) If acceptance of a rated order or performance against a rated order would violate any other regulation, official action, or order of the HHS issued under the authority of the DPA or another relevant statute. (d) Customer notification requirements. (1) Except as provided in paragraph (e) of this section, a person must accept or reject a rated order in writing or electronically within fifteen (15) working days after receipt of a DO-rated order and within ten (10) working days after receipt of a DX-rated order. If the order is rejected, the person must give reasons in writing or electronically for the rejection. (2) If a person has accepted a rated order and subsequently finds that shipment or performance will be delayed, the person must notify the customer immediately, give the reasons for the delay, and advise of a new shipment or performance date. If notification is given verbally, written or electronic confirmation must be provided within five (5) working days. (e) Exception for emergency response conditions. If the rated order is placed for the purpose of emergency preparedness, a person must accept or reject a rated order and transmit the acceptance or rejection in writing or in an electronic format within two (2) days after receipt of the order if: (1) The order is issued in response to a hazard that has occurred; or (2) The order is issued to prepare for an imminent hazard. Sec. 101.34 Preferential scheduling. (a) A person must schedule operations, including the acquisition of all needed production items or services, in a timely manner to satisfy the delivery requirements of each rated order. Modifying production or delivery schedules is necessary only when required delivery dates for rated orders cannot otherwise be met. (b) DO-rated orders must be given production preference over unrated orders, if necessary to meet required delivery dates, even if this requires the diversion of items being processed or ready for delivery or services being performed against unrated orders. Similarly, DX-rated orders must be given preference over DO-rated orders and unrated orders. (Examples: If a person receives a DO-rated order with a delivery date of June 3 and if meeting that date would mean delaying production or delivery of an item for an unrated order, the unrated order must be delayed. If a DX-rated order is received calling for delivery on July 15 and a person has a DO-rated order requiring delivery on June 2 and operations can be scheduled to meet both deliveries, there is no need to alter production schedules to give any additional preference to the DX-rated order.) (c) Conflicting rated orders. (1) If a person finds that delivery or performance against any accepted rated orders conflicts with the delivery or performance against other accepted rated orders of equal priority status, the person shall give precedence to the conflicting orders in the sequence in which they are to be delivered or performed (not to the receipt dates). If the conflicting orders are scheduled to be delivered or performed on the same day, the person shall give precedence to those orders that have the earliest receipt dates. (2) If a person is unable to resolve rated order delivery or performance conflicts under this section, the person should promptly seek special priorities assistance as provided in Sec. Sec. 101.40 through 101.44. If the person's customer objects to the rescheduling of delivery or performance of a rated order, the customer should promptly seek special priorities assistance as provided in Sec. Sec. 101.40 through 101.44. For any rated order against which delivery or performance will be delayed, the person must notify the customer as provided in Sec. 101.33(d)(2). (d) If a person is unable to purchase needed production items in time to fill a rated order by its required delivery date, the person must fill the rated order by using inventoried production items. A person who uses inventoried items to fill a rated order may replace those items with the use of a rated order as provided in Sec. 101.37(b). Sec. 101.35 Extension of priority ratings. (a) A person must use rated orders with suppliers to obtain items or services needed to fill a rated order. The person must use the priority rating indicated on the customer's rated order, except as otherwise provided in this part or as directed by the Department of Health and Human Services. (b) The priority rating must be included on each successive order placed to obtain items or services needed to fill a customer's rated order. This continues from contractor to subcontractor to supplier throughout the entire procurement chain. Sec. 101.36 Changes or cancellations of priority ratings and rated orders. (a) The priority rating on a rated order may be changed or canceled by: (1) An official action of HHS; or (2) Written notification from the originating agency that placed the rated order. (b) If an unrated order is amended so as to make it a rated order, or a DO rating is changed to a DX rating, the supplier must give the appropriate preferential treatment to the order as of the date the change is received by the supplier. (c) An amendment to a rated order that significantly alters a supplier's original production or delivery schedule shall constitute a new rated order as of the date of its receipt. The supplier must accept or reject the amended order according to the provisions of Sec. 101.33. (d) The following amendments do not constitute a new rated order: a change in shipping destination; a reduction in the total amount of the order; an increase in the total amount of the order which has negligible impact upon deliveries; a minor variation in size or design; or a change which is agreed upon between the supplier and the customer. (e) If a person no longer needs items or services to fill a rated order, any rated orders placed with suppliers for the items or services, or the priority rating on those orders, must be canceled. (f) When a priority rating is added to an unrated order, or is changed or canceled, all suppliers must be promptly notified in writing. Sec. 101.37 Use of rated orders. (a) A person must use rated orders to obtain: (1) Items which will be physically incorporated into other items to fill rated orders, including that portion of such items normally consumed or converted into scrap or by-products in the course of processing; (2) Containers or other packaging materials required to make delivery of the finished items against rated orders; (3) Services, other than contracts of employment, needed to fill rated orders; and (4) MRO needed to produce the finished items to fill rated orders. [[Page 42418]] (b) A person may use a rated order to replace inventoried items (including finished items) if such items were used to fill rated orders, as follows: (1) The order must be placed within 90 days of the date of use of the inventory. (2) A DO rating and the program identification symbol indicated on the customer's rated order must be used on the order. A DX rating may not be used even if the inventory was used to fill a DX-rated order. (3) If the priority ratings on rated orders from one customer or several customers contain different program identification symbols, the rated orders may be combined. In this case, the program identification symbol ``H1'' must be used (i.e., DO-H1). (c) A person may combine DX- and DO-rated orders from one customer or several customers if the items or services covered by each level of priority are identified separately and clearly. If different program identification symbols are indicated on those rated orders of equal priority, the person must use the program identification symbol ``H1'' (i.e., DO-H1 or DX-H1). (d) Combining rated and unrated orders. (1) A person may combine rated and unrated order quantities on one purchase order provided that: (i) The rated quantities are separately and clearly identified; and (ii) The four elements of a rated order, as required by Sec. 101.32, are included on the order with the statement required in Sec. 101.32(d) modified to read in substance: This purchase order contains rated order quantities certified for national defense use, and you are required to follow all applicable provisions of the Health Resources Priorities and Allocations System regulations at 45 CFR part 101, subpart A, only as it pertains to the rated quantities. (2) A supplier must accept or reject the rated portion of the purchase order as provided in Sec. 101.33 and give preferential treatment only to the rated quantities as required by this part. This part may not be used to require preferential treatment for the unrated portion of the order. (3) Any supplier who believes that rated and unrated orders are being combined in a manner contrary to the intent of this part or in a fashion that causes undue or exceptional hardship may submit a request for adjustment or exception under Sec. 101.80. (e) A person may place a rated order for the minimum commercially procurable quantity even if the quantity needed to fill a rated order is less than that minimum. However, a person must combine rated orders as provided in paragraph (c) of this section, if possible, to obtain minimum procurable quantities. (f) A person is not required to place a priority rating on an order for less than one-half of the Simplified Acquisition Threshold (as established in the Federal Acquisition Regulation (FAR) (see 48 CFR 2.101) or in other authorized acquisition regulatory or management systems) whichever amount is greater, provided that delivery can be obtained in a timely fashion without the use of the priority rating. Sec. 101.38 Limitations on placing rated orders. (a) General limitations. (1) A person may not place a DO- or DX- rated order unless entitled to do so under this part. (2) Rated orders may not be used to obtain: (i) Delivery on a date earlier than needed; (ii) A greater quantity of the item or services than needed, except to obtain a minimum procurable quantity. Separate rated orders may not be placed solely for the purpose of obtaining minimum procurable quantities on each order; (iii) Items or services in advance of the receipt of a rated order, except as specifically authorized by HHS (see Sec. 101.41(c) for information on obtaining authorization for a priority rating in advance of a rated order); (iv) Items that are not needed to fill a rated order, except as specifically authorized by HHS, or as otherwise permitted by this part; or (v) Any of the following items unless specific priority rating authority has been obtained from HHS, a Delegate Agency, or the Department of Commerce, as appropriate: (A) Items for plant improvement, expansion, or construction, unless they will be physically incorporated into a construction project covered by a rated order; and (B) Production or construction equipment or items to be used for the manufacture of production equipment. [For information on requesting priority rating authority, see Sec. 101.41.] (vi) Any items related to the development of chemical or biological warfare capabilities or the production of chemical or biological weapons, unless such development or production has been authorized by the President or the Secretary of Defense. This provision does not however prohibit the use of the priority and allocations authority to acquire or produce qualified countermeasures that are necessary to treat, identify, or prevent harm from any biological or chemical agent that may cause a public health emergency affecting national security. (b) Jurisdictional limitations. Unless authorized by the resource agency with jurisdiction, the provisions of this part are not applicable to the following resources: (1) Food resources, food resource facilities, and the domestic distribution of farm equipment and commercial fertilizer (Resource agency with jurisdiction--Department of Agriculture); (2) Energy supplies (Resource agency with jurisdiction--Department of Energy); (3) All forms of civil transportation (Resource agency with jurisdiction--Department of Transportation); (4) Water resources (Resource agency with jurisdiction--Department of Defense/U.S. Army Corps of Engineers); and (5) Communications services (Resource agency with jurisdiction-- National Communications System under E.O. 12472 of April 3, 1984). Subpart D--Special Priorities Assistance Sec. 101.40 General provisions. (a) The six regulations that comprise the Federal Priorities and Allocations System are designed to be largely self-executing. However, from time-to-time production or delivery problems will arise in connection with rated orders for health resources as covered under this part. In this event, a person should immediately contact the Secretary for guidance, as specified in Sec. 101.93. If the HHS is unable to resolve the problem or to authorize the use of a priority rating and believes additional assistance is warranted, HHS may forward the request to another agency with resource jurisdiction, or the Department of Commerce, as appropriate, for action. Special priorities assistance is provided to alleviate problems that do arise. (b) Special priorities assistance is available for any reason consistent with this part. Generally, special priorities assistance is provided to expedite deliveries, resolve delivery conflicts, place rated orders, locate suppliers, or to verify information supplied by customers and vendors. Special priorities assistance may also be used to request rating authority for items that are not normally eligible for priority treatment. (c) A request for special priorities assistance or priority rating authority must be submitted to the Secretary, as specified in Sec. 101.93. [[Page 42419]] Sec. 101.41 Requests for priority rating authority. (a) If a rated order is likely to be delayed because a person is unable to obtain items or services not normally rated under this part, the person may request the authority to use a priority rating in ordering the needed items or services. (b) Rating authority for production or construction equipment. (1) A request for priority rating authority for production or construction equipment must be submitted to the U.S. Department of Commerce on Form BIS-999. (2) When the use of a priority rating is authorized for the procurement of production or construction equipment, a rated order may be used either to purchase or to lease such equipment. However, in the latter case, the equipment may be leased only from a person engaged in the business of leasing such equipment or from a person willing to lease rather than sell. (c) Rating authority in advance of a rated prime contract. (1) In certain cases and upon specific request, the Department of Health and Human Services, in order to promote the national defense, may authorize a person to place a priority rating on an order to a supplier in advance of the issuance of a rated prime contract. In these instances, the person requesting advance-rating authority must obtain sponsorship of the request from the Department of Health and Human Services or the appropriate Delegate Agency. The person shall also assume any business risk associated with the placing of rated orders in the event the rated prime contract is not issued. (2) The person must state the following in the request: It is understood that the authorization of a priority rating in advance of our receiving a rated prime contract from the Department of Health and Human Services and our use of that priority rating with our suppliers in no way commits the Department of Health and Human Services or any other government agency to enter into a contract or order or to expend funds. Further, we understand that the Federal Government shall not be liable for any cancellation charges, termination costs, or other damages that may accrue if a rated prime contract is not eventually placed and, as a result, we must subsequently cancel orders placed with the use of the priority rating authorized as a result of this request. (3) In reviewing requests for rating authority in advance of a rated prime contract, HHS will consider, among other things, the following criteria: (i) The probability that the prime contract will be awarded; (ii) The impact of the resulting rated orders on suppliers and on other authorized programs; (iii) Whether the contractor is the sole source; (iv) Whether the item being produced has a long lead time; (v) The time period for which the rating is being requested. (4) The HHS may require periodic reports on the use of the rating authority granted under paragraph (c) of this section. (5) If a rated prime contract is not issued, the person shall promptly notify all suppliers who have received rated orders pursuant to the advanced rating authority that the priority rating on those orders is cancelled. Sec. 101.42 Examples of assistance. (a) While special priorities assistance may be provided for any reason in support of this part, it is usually provided in situations where: (1) A person is experiencing difficulty in obtaining delivery against a rated order by the required delivery date; or (2) A person cannot locate a supplier for an item or service needed to fill a rated order. (b) Other examples of special priorities assistance include: (1) Ensuring that rated orders receive preferential treatment by suppliers; (2) Resolving production or delivery conflicts between various rated orders; (3) Assisting in placing rated orders with suppliers; (4) Verifying the urgency of rated orders; and (5) Determining the validity of rated orders. Sec. 101.43 Criteria for assistance. Requests for special priorities assistance should be timely, i.e., the request has been submitted promptly and enough time exists for HHS, or the agencies to which HHS has delegated its authority to issue rated orders (the ``Delegate Agency''), or the Department of Commerce for industrial resources to effect a meaningful resolution to the problem, and must establish that: (a) There is an urgent need for the item; and (b) The applicant has made a reasonable effort to resolve the problem. Sec. 101.44 Instances where assistance may not be provided. Special priorities assistance is provided at the discretion of HHS or the Delegate Agency when it is determined that such assistance is warranted to meet the objectives of this part. Examples where assistance may not be provided include situations when a person is attempting to: (a) Secure a price advantage; (b) Obtain delivery prior to the time required to fill a rated order; (c) Gain competitive advantage; (d) Disrupt an industry apportionment program in a manner designed to provide a person with an unwarranted share of scarce items; or (e) Overcome a supplier's regularly established terms of sale or conditions of doing business. Subpart E--Allocation Actions Sec. 101.50 Policy. (a) It is the policy of the Federal Government that the allocations authority under title I of the Defense Production Act may: (1) Only be used when there is insufficient supply of a material, service, or facility to satisfy national defense supply requirements through the use of the priorities authority or when the use of the priorities authority would cause a severe and prolonged disruption in the supply of materials, services, or facilities available to support normal U.S. economic activities; and (2) Not be used to ration materials or services at the retail level. (b) Allocation orders, when used, will be distributed equitably among the suppliers of the materials, services, or facilities being allocated and not require any person to relinquish a disproportionate share of the civilian market. Sec. 101.51 General procedures. When HHS plans to execute its allocations authority to address a supply problem within its resource jurisdiction, the Department shall develop a plan that includes the following information: (a) A copy of the Secretary's finding for Presidential approval made, in accordance with Section 201(e) of E.O. 13603, that the material or materials at issue are scarce and critical materials essential to the national defense and that the requirements for national defense for such material(s) cannot otherwise be met without creating a significant dislocation of the normal distribution of such material(s) in to such a degree as to create appreciable hardship. (b) A detailed description of the situation to include any unusual events or circumstances that have created the requirement for an allocation action; (c) A statement of the specific objective(s) of the allocation action; (d) A list of the materials, services, or facilities to be allocated; (e) A list of the sources of the materials, services, or facilities that will be subject to the allocation action; [[Page 42420]] (f) A detailed description of the provisions that will be included in the allocation orders, including the type(s) of allocation orders, the percentages or quantity of capacity or output to be allocated for each purpose, and the duration of the allocation action (i.e., anticipated start and end dates); (g) An evaluation of the impact of the proposed allocation action on the civilian market; and (h) Proposed actions, if any, to mitigate disruptions to civilian market operations. Sec. 101.52 Controlling the general distribution of a material in the civilian market. (a) No allocation action taken by HHS may be used to control the general distribution of a material in the civilian market, unless the Secretary has: (1) Made a written finding that: (i) Such material is a scarce and critical material essential to the national defense, and (ii) The requirements of the national defense for such material cannot otherwise be met without creating a significant dislocation of the normal distribution of such material in the civilian market to such a degree as to create appreciable hardship; (2) Submitted the finding for the President's approval through the Assistant to the President for National Security Affairs; and (3) The President has approved the finding. (b) The requirements of this section may not delegated by the Secretary (See E.O. 13603, Section 201(e)). Sec. 101.53 Types of allocation orders. There are three types of allocation orders available for communicating allocation actions. These are: (a) Set-aside. An official action that requires a person to reserve materials, services, or facilities capacity in anticipation of the receipt of rated orders; (b) Directive. An official action that requires a person to take or refrain from taking certain actions in accordance with its provisions. A directive can require a person to: Stop or reduce production of an item; prohibit the use of selected materials, services, or facilities; or divert the use of materials, services, or facilities from one purpose to another; and (c) Allotment. An official action that specifies the maximum quantity of a material, service, or facility authorized for a specific use. Sec. 101.54 Elements of an allocation order. Each allocation order must include: (a) A detailed description of the required allocation action(s); (b) Specific start and end calendar dates for each required allocation action; (c) The written signature on a manually placed order, or the digital signature or name on an electronically placed order, of the Secretary of Health and Human Services. The signature or use of the name certifies that the order is authorized under this part and that the requirements of this part are being followed; (d) A statement that reads in substance: This is an allocation order certified for national defense use. [Insert the legal name of the person receiving the order] is required to comply with this order, in accordance with the provisions of the Health Resources Priorities and Allocations System regulation (45 CFR part 101, subpart A), which is part of the Federal Priorities and Allocations System; and (e) A current copy of the Health Resources Priorities and Allocations System regulation (subpart A of this part). Sec. 101.55 Mandatory acceptance of an allocation order. (a) Except as otherwise specified in this section (see paragraph (c) of this section), a person shall accept and comply with every allocation order received. (b) A person shall not discriminate against an allocation order in any manner such as by charging higher prices for materials, services, or facilities covered by the order or by imposing terms and conditions for contracts and orders involving allocated materials, services, or facilities that differ from the person's terms and conditions for contracts and orders for the materials, services, or facilities prior to receiving the allocation order. (c) If a person is unable to comply fully with the required action(s) specified in an allocation order, the person must notify the Secretary, as specified in Sec. 101.93, immediately, explain the extent to which compliance is possible, and give the reasons why full compliance is not possible. If notification is given verbally, written or electronic confirmation must be provided within five (5) working days. Such notification does not release the person from complying with the order to the fullest extent possible, until the person is notified by the Department of Health and Human Services that the order has been changed or cancelled. Sec. 101.56 Changes or cancellations of an allocation order. An allocation order may be changed or canceled by an official action of the Department of Health and Human Services. Subpart F--Official Actions Sec. 101.60 General provisions. (a) HHS may take specific official actions to implement the provisions of this subpart. (b) These official actions include, but are limited to, Rating Authorizations, Directives, and Memoranda of Understanding (See Sec. 101.20.) Sec. 101.61 Rating Authorizations. (a) A Rating Authorization is an official action granting specific priority rating authority that: (1) Permits a person to place a priority rating on an order for an item or service not normally ratable under this part; or (2) Authorizes a person to modify a priority rating on a specific order or series of contracts or orders. (b) To request priority rating authority, see Sec. 101.41. Sec. 101.62 Directives. (a) A Directive is an official action that requires a person to take or refrain from taking certain actions in accordance with its provisions. (b) A person must comply with each Directive issued. However, a person may not use or extend a Directive to obtain any items from a supplier, unless expressly authorized to do so in the Directive. (c) A Priorities Directive takes precedence over all DX-rated orders, DO-rated orders, and unrated orders previously or subsequently received, unless a contrary instruction appears in the Directive. (d) An Allocations Directive takes precedence over all Priorities Directives, DX-rated orders, DO-rated orders, and unrated orders previously or subsequently received, unless a contrary instruction appears in the Directive. Sec. 101.63 Letters and Memoranda of Understanding. (a) A Letter or Memorandum of Understanding is an official action that may be issued in resolving special priorities assistance cases to reflect an agreement reached by all parties including HHS, the Department of Commerce (if applicable), a Delegate Agency (if applicable), the supplier, and the customer). (b) A Letter or Memorandum of Understanding is not used to alter scheduling between rated orders, to authorize the use of priority ratings, to [[Page 42421]] impose restrictions under this part. Rather, Letters or Memoranda of Understanding are used to confirm production or shipping schedules that do not require modifications to other rated orders. Subpart G--Compliance Sec. 101.70 General provisions. (a) HHS may take specific official actions for any reason necessary or appropriate to the enforcement or the administration of the Defense Production Act and other applicable statutes, this part, or an official action. Such actions include Administrative Subpoenas, Demands for Information, and Inspection Authorizations. (b) Any person who places or receives a rated order or an allocation order must comply with the provisions of this part. (c) Willful violation of the provisions of title I or section 705 of the Defense Production Act and other applicable statutes, this part, or an official action of the Department of Health and Human Services is a criminal act, punishable as provided in the Defense Production Act and other applicable statutes, and as set forth in Sec. 101.74. Sec. 101.71 Audits and investigations. (a) Audits and investigations are official examinations of books, records, documents, other writings and information to ensure that the provisions of the Defense Production Act and other applicable statutes, this part, and official actions have been properly followed. An audit or investigation may also include interviews and a systems evaluation to detect problems or failures in the implementation of this part. (b) When undertaking an audit or investigation, HHS shall: (1) Define the scope and purpose in the official action given to the person under investigation; and (2) Have ascertained that the information sought or other adequate and authoritative data are not available from any Federal or other responsible agency. (c) In administering this part, HHS may issue the following documents that constitute official actions: (1) Administrative Subpoenas. An Administrative Subpoena requires a person to appear as a witness before an official designated by HHS to testify under oath on matters of which that person has knowledge relating to the enforcement or the administration of the Defense Production Act and other applicable statutes, this part, or official actions. An Administrative Subpoena may also require the production of books, papers, records, documents and physical objects or property. (2) Demands for Information. A Demand for Information requires a person to furnish to a duly authorized representative of HHS any information necessary or appropriate to the enforcement or the administration of the Defense Production Act and other applicable statutes, this part, or official actions. (3) Inspection Authorizations. An Inspection Authorization requires a person to permit a duly authorized representative of HHS to interview the person's employees or agents, to inspect books, records, documents, other writings, and information, including electronically-stored information, in the person's possession or control at the place where that person usually keeps them or otherwise, and to inspect a person's property when such interviews and inspections are necessary or appropriate to the enforcement or the administration of the Defense Production Act and related statutes, this part, or official actions. (d) The production of books, records, documents, other writings, and information will not be required at any place other than where they are usually kept, if, prior to the return date specified in the Administrative Subpoena or Demand for Information, a duly authorized official of HHS is furnished with copies of such material that are certified under oath to be true copies. As an alternative, a duly authorized representative of HHS may enter into a stipulation with a person as to the content of the material. (e) An Administrative Subpoena, Demand for Information, or Inspection Authorization, shall include the name, title, or official position of the person to be served, the evidence sought to be adduced, and its general relevance to the scope and purpose of the audit, investigation, or other inquiry. If employees or agents are to be interviewed; if books, records, documents, other writings, or information are to be produced; or if property is to be inspected; the Administrative Subpoena, Demand for Information, or Inspection Authorization will describe them with particularity. (f) Service of documents shall be made in the following manner: (1) Service of a Demand for Information or Inspection Authorization shall be made personally, or by Certified Mail-Return Receipt Requested at the person's last known address. Service of an Administrative Subpoena shall be made personally. Personal service may also be made by leaving a copy of the document with someone at least 18 years old at the person's last known dwelling or place of business. (2) Service upon other than an individual may be made by serving a partner, corporate officer, or a managing or general agent authorized by appointment or by law to accept service of process. If an agent is served, a copy of the document shall be mailed to the person named in the document. (3) Any individual 18 years of age or over may serve an Administrative Subpoena, Demand for Information, or Inspection Authorization. When personal service is made, the individual making the service shall prepare an affidavit as to the manner in which service was made and the identity of the person served, and return the affidavit, and in the case of subpoenas, the original document, to the issuing officer. In case of failure to make service, the reasons for the failure shall be stated on the original document. Sec. 101.72 Compulsory process. (a) If a person refuses to permit a duly authorized representative of the Department of Health and Human Services to have access to any premises or to the source of information necessary to the administration or the enforcement of the Defense Production Act and other applicable statutes, this part, or official actions, HHS, through its authorized representative may seek compulsory process. Compulsory process means the institution of appropriate legal action, including ex parte application for an inspection warrant or its equivalent, in any forum of appropriate jurisdiction. (b) Compulsory process may be sought in advance of an audit, investigation, or other inquiry, if, in the judgment of the Secretary there is reason to believe that a person will refuse to permit an audit, investigation, or other inquiry, or that other circumstances exist which make such process desirable or necessary. Sec. 101.73 Notification of failure to comply. (a) At the conclusion of an audit, investigation, or other inquiry, or at any other time, HHS may inform the person in writing of HHS's position regarding that person's non-compliance with the requirements of the DPA and other applicable statutes, this part, or an official action. (b) In cases where HHS determines that failure to comply with the provisions of the DPA and other applicable statutes, this part, or an official action was inadvertent, the person may be informed in writing of the particulars involved and the [[Page 42422]] corrective action to be taken. Failure to take corrective action may then be construed as a willful violation of DPA and other applicable statutes, this part, or an official action. Sec. 101.74 Violations, penalties, and remedies. (a) Willful violation of the provisions of the DPA, the priorities provisions of the Selective Service Act and related statutes (when applicable), this part, or an official action, is a crime and upon conviction, a person may be punished by fine or imprisonment, or both. The maximum penalties provided by the DPA are a $10,000 fine, or one year in prison, or both. The maximum penalties provided by the Selective Service Act and related statutes are a $50,000 fine, or three years in prison, or both. (b) The Government may also seek an injunction from a court of appropriate jurisdiction to prohibit the continuance of any violation of, or to enforce compliance with, the DPA, this part, or an official action. (c) In order to secure the effective enforcement of the DPA and other applicable statutes, this part, and official actions, the following are prohibited: (1) No person may solicit, influence or permit another person to perform any act prohibited by, or to omit any act required by, the DPA and other applicable statutes, this part, or an official action. (2) No person may conspire or act in concert with any other person to perform any act prohibited by, or to omit any act required by, the DPA and other applicable statutes, this part, or an official action. (3) No person shall deliver any item if the person knows or has reason to believe that the item will be accepted, redelivered, held, or used in violation of the DPA and other applicable statutes, this part, or an official action. In such instances, the person must immediately notify HHS that, in accordance with this provision, delivery has not been made. Sec. 101.75 Compliance conflicts. If compliance with any provision of the DPA and other applicable statutes, this part, or an official action would prevent a person from filling a rated order or from complying with another provision of the DPA and other applicable statutes, this part, or an official action, the person must immediately notify the Secretary, as specified in Sec. 101.93, for resolution of the conflict. Subpart H--Adjustments, Exceptions, and Appeals Sec. 101.80 Adjustments or exceptions. (a) A person may submit a request to the Secretary for an adjustment or exception on the ground that: (1) A provision of this part or an official action results in an undue or exceptional hardship on that person not suffered generally by others in similar situations and circumstances; or (2) The consequences of following a provision of this part or an official action are contrary to the intent of the DPA and other applicable statutes, or this part. (b) Each request for adjustment or exception must be in writing and contain a complete statement of all the facts and circumstances related to the provision of this part or official action from which adjustment is sought and a full and precise statement of the reasons why relief should be provided. (c) The submission of a request for adjustment or exception shall not relieve any person from the obligation of complying with the provision of this part or official action in question while the request is being considered unless such interim relief is granted in writing by the Secretary or the Secretary's designated representative. (d) A decision of the Secretary or the Secretary's designated representative under this section may be appealed to the Secretary (For information on the appeal procedure, see Sec. 101.81.) Sec. 101.81 Appeals. (a) Any person whose request for adjustment or exception was denied by the Secretary or the Secretary's designated representative under Section. 94a.80, may appeal to the Secretary who, through the Secretary's designated representative, shall review and reconsider the denial. (b)(1) Except as provided in paragraph (b)(2) of this section, an appeal must be received by the Secretary no later than 45 days after receipt of a written notice of denial. After this 45 day period, an appeal may be accepted at the discretion of the Secretary. (2) For requests for adjustment or exception involving rated orders placed for the purpose of emergency preparedness (see Sec. 101.33(e)), an appeal must be received by the Secretary, no later than 15 days after receipt of a written notice of denial. Contract performance under the order shall not be stayed pending resolution of the appeal. (c) Each appeal must be in writing and contain a complete statement of all the facts and circumstances related to the action appealed from and a full and precise statement of the reasons the decision should be modified or reversed. (d) In addition to the written materials submitted in support of an appeal, an appellant may request, in writing, an opportunity for an informal hearing. This request may be granted or denied at the discretion of the Secretary or the Secretary's designated representative. (e) When a hearing is granted, the Secretary may designate an HHS employee to act as the Secretary's representative and hearing officer to conduct the hearing and to prepare a report. The hearing officer shall determine all procedural questions and impose such time or other limitations deemed reasonable. In the event that the hearing officer decides that a printed transcript is necessary, all expenses shall be borne by the appellant. (f) When determining an appeal, the Secretary may consider all information submitted during the appeal as well as any recommendations, reports, or other relevant information and documents available to HHS or consult with any other persons or groups. (g) The submission of an appeal under this section shall not relieve any person from the obligation of complying with the provision of this part or official action in question while the appeal is being considered unless such relief is granted in writing by the Secretary. Subpart I--Miscellaneous Provisions Sec. 101.90 Protection against claims. A person shall not be held liable for damages or penalties for any act or failure to act resulting directly or indirectly from compliance with any provision of this part, or an official action, notwithstanding that such provision or action shall subsequently be declared invalid by judicial or other competent authority. Sec. 101.91 Records and reports. (a) Persons are required to make and preserve for at least three years, accurate and complete records of any transaction covered by this part or an official action. (b) Records must be maintained in sufficient detail to permit the determination, upon examination, of whether each transaction complies with the provisions of this part or any official action. However, this part does not specify any particular method or system to be used. (c) Records required to be maintained by this part must be made available for examination on demand by duly authorized representatives of HHS as provided in Sec. 101.71. [[Page 42423]] (d) In addition, persons must develop, maintain, and submit any other records and reports to HHS that may be required for the administration of the DPA and other applicable statutes, and this part. (e) DPA Section 705(d), as implemented by E.O. 13603, provides that information obtained under this section which the Secretary deems confidential, or with reference to which a request for confidential treatment is made by the person furnishing such information, shall not be published or disclosed unless the Secretary determines that the withholding of this information is contrary to the interest of the national defense. Information required to be submitted to HHS in connection with the enforcement or administration of the DPA, this part, or an official action, is deemed to be confidential under DPA Section 705(d) and shall be handled in accordance with applicable Federal law. Sec. 101.92 Applicability of this part and official actions. (a) This part and all official actions, unless specifically stated otherwise, apply to transactions in any state, territory, or possession of the United States and the District of Columbia. (b) This part and all official actions apply not only to deliveries to other persons but also include deliveries to affiliates and subsidiaries of a person and deliveries from one branch, division, or section of a single entity to another branch, division, or section under common ownership or control. (c) This part and its schedules shall not be construed to affect any administrative actions taken by HHS, or any outstanding contracts or orders placed pursuant to any of the regulations, orders, schedules or delegations of authority previously issued by HHS pursuant to authority granted to HHS, by the President under the DPA and E.O. 13603. Such actions, contracts, or orders shall continue in full force and effect under this part unless modified or terminated by proper authority. Sec. 101.93 Communications. All communications concerning this part, including requests for copies of the part and explanatory information, requests for guidance or clarification, and requests for adjustment or exception shall be addressed to the Secretary, U.S. Department of Health and Human Services, and Washington, DC. Dated: March 3, 2015. Sylvia M. Burwell, Secretary. Editorial note: This document was received by the Office of the Federal Register on July 8, 2015. [FR Doc. 2015-17047 Filed 7-16-15; 8:45 am] BILLING CODE 4150-28-P
![42408 Federal Register / Vol. 80, No. 137 / Friday, July 17, 2015 / Rules and Regulations
Date certain
Federal
Community Effective date authorization/cancellation of Current effective assistance no
State and location No. sale of flood insurance in community map date longer
available
in SFHAs
Rutland, Township of, Tioga County ..... 422099 March 14, 1975, Emerg; August 1, 1987, ......do ............... do
Reg; July 16, 2015, Susp.
Shippen, Township of, Tioga County .... 422100 May 23, 1975, Emerg; December 1, 1986, ......do ............... do
Reg; July 16, 2015, Susp.
Sullivan, Township of, Tioga County ..... 421183 December 20, 1974, Emerg; March 1, ......do ............... do
1987, Reg; July 16, 2015, Susp.
Tioga, Borough of, Tioga County .......... 420827 February 9, 1973, Emerg; May 1, 1988, ......do ............... do
Reg; July 16, 2015, Susp.
Tioga, Township of, Tioga County ........ 420828 April 17, 1973, Emerg; August 15, 1980, ......do ............... do
Reg; July 16, 2015, Susp.
Union, Township of, Tioga County ........ 421184 August 7, 1975, Emerg; February 1, 1987, ......do ............... do
Reg; July 16, 2015, Susp.
Ward, Township of, Tioga County ......... 422101 August 8, 1975, Emerg; July 1, 1987, Reg; ......do ............... do
July 16, 2015, Susp.
Wellsboro, Borough of, Tioga County ... 420829 December 26, 1973, Emerg; April 15, 1981, ......do ............... do
Reg; July 16, 2015, Susp.
Westfield, Borough of, Tioga County .... 422093 April 22, 1975, Emerg; March 1, 1987, Reg; ......do ............... do
July 16, 2015, Susp.
Westfield, Township of, Tioga County .. 421185 March 11, 1975, Emerg; March 1, 1987, ......do ............... do
Reg; July 16, 2015, Susp.
Virginia:
Hopewell, City of, Independent City. ..... 510080 May 27, 1975, Emerg; September 5, 1979, ......do ............... do
Reg; July 16, 2015, Susp.
Region IV
Florida:
Okeechobee, City of, Okeechobee 120178 July 2, 1975, Emerg; August 26, 1977, Reg; ......do ............... do
County. July 16, 2015, Susp.
Okeechobee County, Unincorporated 120177 May 1, 1975, Emerg; February 4, 1981, ......do ............... do
Areas.. Reg; July 16, 2015, Susp.
Region IX
California:
Burlingame, City of, San Mateo County 065019 March 19, 1971, Emerg; September 16, ......do ............... do
1981, Reg; July 16, 2015, Susp.
San Mateo, City of, San Mateo County 060328 December 26, 1974, Emerg; March 30, ......do ............... do
1981, Reg; July 16, 2015, Susp.
San Mateo County, Unincorporated 060311 August 27, 1975, Emerg; July 5, 1984, Reg; ......do ............... do
Areas.. July 16, 2015, Susp.
*......do = Ditto.
Code for reading third column: Emerg.—Emergency; Reg.—Regular; Susp.—Suspension.
Dated: June 25, 2015. which the U.S. Department of Health DATES: Effective July 17, 2015.
Roy E. Wright, and Human Services (HHS) may require Comments must be received by
Deputy Associate Administrator, Federal that certain contracts or orders that September 15, 2015.
Insurance and Mitigation Administration, promote the national defense be given ADDRESSES: You may submit comments,
Department of Homeland Security, Federal priority over other contracts or orders. identified by RIN 0991–AB94 by any of
Emergency Management Agency.
This rule also sets new standards and the following methods:
[FR Doc. 2015–17526 Filed 7–16–15; 8:45 am] procedures by which HHS may allocate • Federal eRulemaking Portal: http://
BILLING CODE 9110–12–P materials, services, and facilities to www.regulations.gov. Follow the
promote the national defense. This rule instructions for submitting comments.
will implement HHS’s administration of • By email directly to
DEPARTMENT OF HEALTH AND priorities and allocations actions, and Cassandra.Freeman@hhs.gov.
HUMAN SERVICES (HHS) establish the Health Resources Priorities • By mail or delivery to Cassandra
and Allocation System (HRPAS). The Freeman, Director, Division of
45 CFR Part 101
HRPAS will cover health resources Acquisition Policy, Office of the
RIN 0991–AB94 pursuant to the authority under Section Assistant Secretary for Preparedness
101(c) of the Defense Production Act as and Response, U.S. Department of
asabaliauskas on DSK5VPTVN1PROD with RULES
Health Resources Priority and Health and Human Services, 200
delegated to HHS by Executive Order
Allocations System (HRPAS) Independence Avenue SW., Room 630G,
13603. Priorities authorities (and other
AGENCY: Department of Health and authorities delegated to the Secretary in Washington, DC 20201.
Human Services, Office of the Secretary. E.O. 13603, but not covered by this Written comments regarding the
ACTION: Interim final rule. regulation) may be re-delegated by the burden-hour estimates or other aspects
Secretary. The Secretary retains the of the collection-of-information
SUMMARY: This interim final rule requirements or any other provisions
authority for allocations.
establishes standards and procedures by contained in this interim final rule may
VerDate Sep<11>2014 17:58 Jul 16, 2015 Jkt 235001 PO 00000 Frm 00036 Fmt 4700 Sfmt 4700 E:\FR\FM\17JYR1.SGM 17JYR1](https://thefederalregister.org/doc/80_FR_42545/page/1.svg)
![42410 Federal Register / Vol. 80, No. 137 / Friday, July 17, 2015 / Rules and Regulations
specifically excludes the use of rated directive, and an allotment. A set-aside fulfilling the order. If a person is unable
orders for resources within the resource is an official action that will require a to comply fully with the required
jurisdiction of agencies other than HHS person to reserve resource capacity in actions specific in an allocation order,
with DPA priorities and allocations anticipation of receipt of rated orders. the person must notify HHS
authority. An allocation directive is an official immediately, explain the extent to
action that will require a person to take which compliance is possible, and give
Special Priorities Assistance
or refrain from taking certain actions in reasons why full compliance is not
Section 101.40, ‘‘General provisions’’ accordance with its provisions (an possible. This section also states that a
illustrates when and how HHS can allocation directive can require a person person may not discriminate against an
provide special priorities assistance, to stop or reduce production of an item, allocation order in any manner, such as
and provides specific HHS points of prohibit the use of selected items, divert by charging higher prices or imposing
contact and the form to be used for supply of one type of product to terms and conditions different than
requesting such assistance. Special another, or to supply a specific quantity, what the person imposed on contracts
priorities assistance may generally be size, shape, and type of an item within or orders for the same resource(s) that
requested for any reason. a specific time period). An allotment is were received prior to receiving the
Section 101.41, ‘‘Requests for priority an official action that will specify the allocation order. Section 101.55 makes
rating authority,’’ directs persons to the maximum quantity of an item it clear to the public that the limited
Department of Commerce to request authorized for use in a specific program circumstances and emergency situations
rating authority for production or or application. HHS is requiring these that trigger issuance of an allocation
construction equipment. This section three types of allocation orders because order require immediate response from
also identifies circumstances in which it believes that, collectively, they the public in order to address the
HHS may authorize a person to place a describe the types of actions that might situation in an expedient fashion.
priority rating on an order to a supplier be taken in any situation in which Section 101.56, ‘‘Changes or
in advance of the issuance of a rated allocation is justified. cancellations of an allocation order’’
prime contract, and lists factors HHS Section 101.54, ‘‘Elements of an provides that an allocation order may be
will consider in deciding whether to allocation order,’’ sets forth the changed or cancelled by HHS.
grant this authority. minimum elements of an allocation
Section 101.42, ‘‘Examples of order. Those elements are: Official Actions
assistance,’’ provides a number of • A detailed description of the Section 101.60, ‘‘General Provisions’’,
examples of when special priorities required allocation action(s); provides HHS and overview regarding
assistance may be provided, although it • Specific start and end calendar implementation of this subpart.
may generally be provided for any dates for each required allocation Section 101.61, ‘‘Rating
reason. action; Authorizations,’’ defines a rating
Section 101.43 lists the criteria for • The written signature on a authorization as an official action
granting assistance, and § 101.44 lists manually placed order, or the digital granting specific priority rating
instances in which assistance may not signature or name on an electronically authority, and refers persons to § 101.21
be provided (i.e., to secure a price placed order, of the Secretary of Health to request such priority rating authority.
advantage). and Human Services or his/her Section 101.62, ‘‘Directives,’’ defines
Allocation Actions designee, which certifies that the order a directive as an official action that
is authorized under this regulation and requires a person to take or refrain from
Sections 101.50 through 101.52 that the order is consistent with taking certain actions in accordance
describe allocations and contain requirements of the regulation; with its provisions. This section details
procedures for the use of allocation • A statement that reads in substance: directive compliance for the public.
orders. Specifically, allocation orders This is an allocation order certified for Section 101.63, ‘‘Letters and
will be used only if priorities authority national defense use. [Insert the legal Memoranda of Understanding,’’ defines
will not provide a sufficient supply of name of the person receiving the order] a letter or memorandum of
material, services or facilities for is required to comply with this order, in understanding as an official action that
national defense requirements, or when accordance with the provisions of the may be issued in resolving special
use of priorities authority will cause a Health Resources Priorities and priorities assistance cases to reflect an
severe and prolonged disruption in the Allocations System regulation (45 CFR agreement reached by all parties, and
supply of resources available to support 101.1), which is part of the Federal explains its use.
normal U.S. economic activities. Priorities and Allocations System; and
Allocation orders will not be used to • A current copy of the HRPAS. Compliance
ration materials or services at the retail HHS rquires these elements because it Section 101.70, ‘‘General Provisions’’
level. Allocation orders will be believes that they provide a proper details the official actions which may be
distributed equitably among the balance between the need for standards taken by HHS to enforce or administer
suppliers of the resource(s) being to permit the public to recognize and the DPA and other applicable statutes.
allocated and will not require any understand an allocation order if one is Section 101.71, ‘‘Audits and
person to relinquish a disproportionate issued, and the expectation that any investigations,’’ details the procedures
share of the civilian market. The actual allocation orders will have to be for official examinations of books,
standards set forth in §§ 101.50 through tailored to meet unforeseeable records, documents, and other writings
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101.52 provide reasonable assurance circumstances. The language of § 101.54 and information to ensure that the
that allocation orders will be used only precludes HHS from including provisions of the DPA and other
in situations where the circumstances additional information in an allocation applicable statutes, this regulation, and
justify such orders. order if circumstances warrant doing so. official actions have been properly
Section 101.53 describes the three Section 101.55, ‘‘Mandatory followed. An audit or investigation may
types of allocation orders that HHS acceptance of allocation orders,’’ also include interviews and a systems
might issue. The types of allocation requires that an allocation order must be evaluation to detect problems or failures
orders are a set-aside, an allocation accepted if a person is capable of in the implementation of this regulation.
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Subpart A—Health Resources (b) Section 202(a) of E.O. 13603 states Allocation means the control of the
Priorities and Allocations System that the priorities and allocations distribution of materials, services, or
authority delegated in Section 201 of facilities for a purpose deemed
General that Executive Order may be used only necessary or appropriate to promote the
§ 101.1 Purpose. to support programs that have been national defense.
determined in writing as necessary or Allocation order means an official
This section provides guidance and
procedures for use of Defense appropriate to promote the national action to control the distribution of
Production Act (DPA) of 1950 Section defense: materials, services, or facilities for a
(1) By the Secretary of Defense with purpose deemed necessary or
101(a) priorities and allocations
respect to military production and appropriate to promote the national
authority with respect to all forms of
construction, military assistance to defense.
health resources necessary or
foreign nations, military use of civil Allotment means an official action
appropriate to promote the national
transportation, stockpiles managed by that specifies the maximum quantity or
defense. The guidance and procedures
the Department of Defense, space, and use of a material, service, or facility
in this part are consistent with the
directly related activities; authorized for a specific use to promote
guidance and procedures provided in (2) By the Secretary of Energy with
other regulations that, as a whole, form the national defense.
respect to energy production and Approved program means a program
the Federal Priorities and Allocations construction, distribution and use, and determined by the Secretary of Defense,
System. Guidance and procedures for directly related activities; and the Secretary of Energy, or the Secretary
use of the DPA priorities and allocations (3) By the Secretary of Homeland of Homeland Security to be necessary or
authority with respect to other types of Security with respect to all other appropriate to promote the national
resources are provided for: food national defense programs, including defense, in accordance with Section 202
resources, food resource facilities, and civil defense and continuity of
the domestic distribution of farm of E.O. 13603.
Government. Construction means the erection,
equipment and commercial fertilizer in7 (c) Section 201(e) of E.O. 13603 addition, extension, or alteration of any
CFR part 700; energy supplies in 10 CFR provides that each department that is building, structure, or project, using
part 217; all forms of civil transportation delegated priorities and allocations materials or products which are to be an
in 49 CFR part 33; water resources in 32 authority under Section 201(a) of E.O. integral and permanent part of the
CFR part 555; and all other materials, 13603 may use this authority with building, structure, or project.
services, and facilities, including respect to control of the general Construction does not include
construction materials in the Defense distribution of any material (including
Priorities and Allocations System maintenance and repair.
applicable services) in the civilian Critical infrastructure means any
(DPAS) regulation (15 CFR part 700). market only after: systems and assets, whether physical or
§ 101.2 Priorities and allocations authority. (1) Making the finding required under cyber-based, so vital to the United States
Section 101(b) of the DPA; and that the degradation or destruction of
(a) Section 201 of E.O. 13603, (2) The finding has been approved by
delegates the President’s authority such systems and assets would have a
the President. debilitating impact on national security,
under Section 101 of the DPA. DPA (d) Priorities authorities (and other
Section 101 provides the President with including, but not limited to, national
authorities delegated to the Secretary in
authority to require acceptance and economic security and national public
E.O. 13603 but not covered by this
priority performance of contracts and health or safety.
regulation) have been re-delegated by Defense Production Act or DPA means
orders (other than contracts of the Secretary to the Assistant Secretary
employment) to promote the national the Defense Production Act of 1950, as
for Preparedness and Response (the amended (50 U.S.C. App. 2061 et seq.).
defense over performance of any other ‘‘ASPR’’). The Secretary retains the
contracts or orders, and to allocate Delegate agency means a Federal
authority for allocations. government agency authorized by
materials, services, and facilities as
deemed necessary or appropriate to § 101.3 Program eligibility. delegation from HHS to place priority
promote the national defense to a Certain programs to promote the ratings on contracts or orders needed to
number of agencies. Section 201 of E.O. national defense are eligible for support approved programs.
13603 delegates the President’s priorities and allocations support. These Directive means an official action that
authority to specific agencies as follows: include programs for military and requires a person to take or refrain from
(1) The Secretary of Agriculture with energy production or construction, taking certain actions in accordance
respect to food resources, food resource military or critical infrastructure with its provisions.
facilities, livestock resources, veterinary assistance to any foreign nation, Emergency preparedness means all
resources, plant health resources, and deployment and sustainment of military those activities and measures designed
the domestic distribution of farm forces, homeland security, stockpiling, or undertaken to prepare for or
equipment and commercial fertilizer; space, and any directly related activity. minimize the effects of a hazard upon
(2) The Secretary of Energy with Other eligible programs include the civilian population, to deal with the
respect to all forms of energy; emergency preparedness activities immediate emergency conditions which
(3) The Secretary of Health and conducted pursuant to Title VI of the would be created by the hazard, and to
Human Services with respect to health Robert T. Stafford Disaster Relief and effectuate emergency repairs to, or the
resources; Emergency Assistance Act [42 U.S.C. emergency restoration of, vital utilities
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(4) The Secretary of Transportation 5195 et seq.] and critical infrastructure and facilities destroyed or damaged by
with respect to all forms of civil protection and restoration. the hazard. ‘‘Emergency Preparedness’’
transportation; includes the following:
(5) The Secretary of Defense with Subpart B—Definitions (1) Measures to be undertaken in
respect to water resources; and preparation for anticipated hazards
(6) The Secretary of Commerce for all § 101.20 Definitions. (including the establishment of
other materials, services, and facilities, The following definitions pertain to appropriate organizations, operational
including construction materials. all sections of this part: plans, and supporting agreements, the
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(1) The development, production, approved program is being supported by § 101.33 Acceptance and rejection of rated
processing, distribution, delivery, or use a rated order. Programs may be orders.
of an industrial resource or a critical approved under the procedures of E.O. (a) Mandatory acceptance. (1) Except
technology item; 13603 Section 202 at any time. Program as otherwise specified in this section, a
(2) The construction of facilities; identification symbols do not connote person shall accept every rated order
(3) The movement of individuals and any priority. received and must fill such orders
property by all modes of civil (c) Priority ratings. A priority rating regardless of any other rated or unrated
transportation; or consists of the rating symbol—DO or orders that have been accepted.
(4) Other national defense programs DX—and the program identification (2) A person shall not discriminate
and activities. symbol, such as DO–HR or DX–HR. against rated orders in any manner such
Set-aside means an official action that as by charging higher prices or by
§ 101.32 Elements of a rated order.
requires a person to reserve materials, imposing different terms and conditions
services, or facilities capacity in Each rated order must include: than for comparable unrated orders.
anticipation of the receipt of rated (a) The appropriate priority rating
(b) Mandatory rejection. Unless
orders. (e.g. DO–HR or DX–HR);
(b) A required delivery date or dates. otherwise directed by HHS for a rated
Stafford Act means title VI order involving all forms of health
(Emergency Preparedness) of the Robert The words ‘‘immediately’’ or ‘‘as soon
as possible’’ do not constitute a delivery resources:
T. Stafford Disaster Relief and (1) A person shall not accept a rated
Emergency Assistance Act, as amended date. A ‘‘requirements contract’’, ‘‘basic
ordering agreement’’, ‘‘prime vendor order for delivery on a specific date if
(42 U.S.C. 5195–5197h). unable to fill the order by that date.
Water resources means all usable contract’’, or similar procurement
document bearing a priority rating may However, the person must inform the
water, from all sources, within the customer of the earliest date on which
jurisdiction of the United States, that contain no specific delivery date or
dates and may provide for the delivery can be made and offer to accept
can be managed, controlled, and the order on the basis of that date.
allocated to meet emergency furnishing of items or service from time-
to-time or within a stated period against Scheduling conflicts with previously
requirements, except ‘‘water resources accepted lower rated or unrated orders
does not include usable water that specific purchase orders, such as
‘‘calls’’, ‘‘requisitions’’, and ‘‘delivery are not sufficient reason for rejection
qualifies as ‘‘food resources’’. under this section.
orders’’. These purchase orders must
specify a required delivery date or dates (2) A person shall not accept a DO-
Subpart C—Placement of Rated Orders rated order for delivery on a date which
and are to be considered as rated as of
§ 101.30 Delegations of authority. the date of their receipt by the supplier would interfere with delivery of any
The priorities and allocations and not as of the date of the original previously accepted DO- or DX-rated
authorities of the President under Title procurement document; orders. However, the person must offer
I of the DPA with respect to all forms (c) The written signature on a to accept the order based on the earliest
of health resources have been delegated manually placed order, or the digital delivery date otherwise possible.
to the Secretary under E.O. 13603. The signature or name on an electronically (3) A person shall not accept a DX-
Secretary may re-delegate the placed order, of an individual rated order for delivery on a date which
Secretary’s priority rating activities authorized to sign rated orders for the would interfere with delivery of any
under the DPA though the allocations person placing the order. The signature previously accepted DX-rated orders,
authority provided to the Secretary is or use of the name certifies that the but must offer to accept the order based
not subject to delegation per Section rated order is authorized under this part on the earliest delivery date otherwise
201(e) of E.O. 13603. and that the requirements of this part possible.
are being followed; and (4) If a person is unable to fill all of
§ 101.31 Priority ratings. (d)(1) A statement that reads in the rated orders of equal priority status
(a) Levels of priority. (1) There are two substance: received on the same day, the person
levels of priority established by Federal must accept, based upon the earliest
This is a rated order certified for national
Priorities and Allocations System defense use, and you are required to follow delivery dates, only those orders which
regulations, identified by the rating all the provisions of the Health Resources can be filled, and reject the other orders.
symbols ‘‘DO’’ and ‘‘DX’’. Priorities and Allocations System regulation For example, a person must accept order
(2) All DO-rated orders have equal at 45 CFR part 101. A requiring delivery on December 15
priority with each other and take (2) If the rated order is placed in before accepting order B requiring
precedence over unrated orders. All DX- support of emergency preparedness delivery on December 31. However, the
rated orders have equal priority with requirements and expedited action is person must offer to accept the rejected
each other and take precedence over necessary and appropriate to meet these orders based on the earliest delivery
DO-rated orders and unrated orders. requirements, the following sentences dates otherwise possible.
(For resolution of conflicts among rated should be added following the (c) Optional rejection. Unless
orders of equal priority, see § 101.34(c).) statement set forth in paragraph (d)(1) of otherwise directed by HHS for a rated
(3) In addition, a Directive regarding this section: order involving all forms of health
priority treatment for a given item (i) This rated order is placed for the resources, rated orders may be rejected
issued by the Department of Health and purpose of emergency preparedness. It in any of the following cases as long as
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Human Services for that item takes must be accepted or rejected within two a supplier does not discriminate among
precedence over any DX-rated order, (2) days after receipt of the order if: customers:
DO-rated order, or unrated order, as (A) The order is issued in response to (1) If the person placing the order is
stipulated in the Directive. (For a full a hazard that has occurred; or unwilling or unable to meet regularly
discussion of Directives, see § 101. 62. (B) If the order is issued to prepare for established terms of sale or payment;
(b) Program identification symbols. an imminent hazard, as specified in (2) If the order is for an item not
Program identification symbols, such as HRPAS § 101.33(e). supplied or for a service not capable of
‘‘DO–HR’’, or ‘‘DX–HR’’, indicate which (ii) [Reserved] being performed;
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(b) A person may use a rated order to combine rated orders as provided in cause a public health emergency
replace inventoried items (including paragraph (c) of this section, if possible, affecting national security.
finished items) if such items were used to obtain minimum procurable (b) Jurisdictional limitations. Unless
to fill rated orders, as follows: quantities. authorized by the resource agency with
(1) The order must be placed within (f) A person is not required to place jurisdiction, the provisions of this part
90 days of the date of use of the a priority rating on an order for less than are not applicable to the following
inventory. one-half of the Simplified Acquisition resources:
(2) A DO rating and the program Threshold (as established in the Federal (1) Food resources, food resource
identification symbol indicated on the Acquisition Regulation (FAR) (see 48 facilities, and the domestic distribution
customer’s rated order must be used on CFR 2.101) or in other authorized of farm equipment and commercial
the order. A DX rating may not be used acquisition regulatory or management fertilizer (Resource agency with
even if the inventory was used to fill a systems) whichever amount is greater, jurisdiction—Department of
DX-rated order. provided that delivery can be obtained
(3) If the priority ratings on rated Agriculture);
in a timely fashion without the use of
orders from one customer or several the priority rating. (2) Energy supplies (Resource agency
customers contain different program with jurisdiction—Department of
identification symbols, the rated orders § 101.38 Limitations on placing rated Energy);
may be combined. In this case, the orders. (3) All forms of civil transportation
program identification symbol ‘‘H1’’ (a) General limitations. (1) A person (Resource agency with jurisdiction—
must be used (i.e., DO–H1). may not place a DO- or DX-rated order Department of Transportation);
(c) A person may combine DX- and unless entitled to do so under this part. (4) Water resources (Resource agency
DO-rated orders from one customer or (2) Rated orders may not be used to with jurisdiction—Department of
several customers if the items or obtain: Defense/U.S. Army Corps of Engineers);
services covered by each level of (i) Delivery on a date earlier than and
priority are identified separately and needed;
(ii) A greater quantity of the item or (5) Communications services
clearly. If different program (Resource agency with jurisdiction—
identification symbols are indicated on services than needed, except to obtain a
minimum procurable quantity. Separate National Communications System under
those rated orders of equal priority, the E.O. 12472 of April 3, 1984).
person must use the program rated orders may not be placed solely
identification symbol ‘‘H1’’ (i.e., DO–H1 for the purpose of obtaining minimum Subpart D—Special Priorities
or DX–H1). procurable quantities on each order; Assistance
(d) Combining rated and unrated (iii) Items or services in advance of
orders. (1) A person may combine rated the receipt of a rated order, except as § 101.40 General provisions.
and unrated order quantities on one specifically authorized by HHS (see
(a) The six regulations that comprise
purchase order provided that: § 101.41(c) for information on obtaining
the Federal Priorities and Allocations
(i) The rated quantities are separately authorization for a priority rating in
System are designed to be largely self-
and clearly identified; and advance of a rated order);
executing. However, from time-to-time
(ii) The four elements of a rated order, (iv) Items that are not needed to fill
production or delivery problems will
as required by § 101.32, are included on a rated order, except as specifically
arise in connection with rated orders for
the order with the statement required in authorized by HHS, or as otherwise
health resources as covered under this
§ 101.32(d) modified to read in permitted by this part; or
part. In this event, a person should
substance: (v) Any of the following items unless
immediately contact the Secretary for
This purchase order contains rated order specific priority rating authority has
guidance, as specified in § 101.93. If the
quantities certified for national defense use, been obtained from HHS, a Delegate
HHS is unable to resolve the problem or
and you are required to follow all applicable Agency, or the Department of
to authorize the use of a priority rating
provisions of the Health Resources Priorities Commerce, as appropriate:
and Allocations System regulations at 45 CFR (A) Items for plant improvement, and believes additional assistance is
part 101, subpart A, only as it pertains to the expansion, or construction, unless they warranted, HHS may forward the
rated quantities. will be physically incorporated into a request to another agency with resource
construction project covered by a rated jurisdiction, or the Department of
(2) A supplier must accept or reject
order; and Commerce, as appropriate, for action.
the rated portion of the purchase order
(B) Production or construction Special priorities assistance is provided
as provided in § 101.33 and give
equipment or items to be used for the to alleviate problems that do arise.
preferential treatment only to the rated
quantities as required by this part. This manufacture of production equipment. (b) Special priorities assistance is
part may not be used to require [For information on requesting priority available for any reason consistent with
preferential treatment for the unrated rating authority, see § 101.41.] this part. Generally, special priorities
portion of the order. (vi) Any items related to the assistance is provided to expedite
(3) Any supplier who believes that development of chemical or biological deliveries, resolve delivery conflicts,
rated and unrated orders are being warfare capabilities or the production of place rated orders, locate suppliers, or
combined in a manner contrary to the chemical or biological weapons, unless to verify information supplied by
intent of this part or in a fashion that such development or production has customers and vendors. Special
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causes undue or exceptional hardship been authorized by the President or the priorities assistance may also be used to
may submit a request for adjustment or Secretary of Defense. This provision request rating authority for items that
exception under § 101.80. does not however prohibit the use of the are not normally eligible for priority
(e) A person may place a rated order priority and allocations authority to treatment.
for the minimum commercially acquire or produce qualified (c) A request for special priorities
procurable quantity even if the quantity countermeasures that are necessary to assistance or priority rating authority
needed to fill a rated order is less than treat, identify, or prevent harm from any must be submitted to the Secretary, as
that minimum. However, a person must biological or chemical agent that may specified in § 101.93.
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(f) A detailed description of the (a) A detailed description of the § 101.56 Changes or cancellations of an
provisions that will be included in the required allocation action(s); allocation order.
allocation orders, including the type(s) (b) Specific start and end calendar An allocation order may be changed
of allocation orders, the percentages or dates for each required allocation or canceled by an official action of the
quantity of capacity or output to be action; Department of Health and Human
allocated for each purpose, and the Services.
duration of the allocation action (i.e., (c) The written signature on a
anticipated start and end dates); manually placed order, or the digital Subpart F—Official Actions
(g) An evaluation of the impact of the signature or name on an electronically
placed order, of the Secretary of Health § 101.60 General provisions.
proposed allocation action on the
and Human Services. The signature or (a) HHS may take specific official
civilian market; and
use of the name certifies that the order actions to implement the provisions of
(h) Proposed actions, if any, to
is authorized under this part and that this subpart.
mitigate disruptions to civilian market (b) These official actions include, but
operations. the requirements of this part are being
followed; are limited to, Rating Authorizations,
§ 101.52 Controlling the general Directives, and Memoranda of
(d) A statement that reads in
distribution of a material in the civilian Understanding (See § 101.20.)
market.
substance:
This is an allocation order certified for § 101.61 Rating Authorizations.
(a) No allocation action taken by HHS
may be used to control the general national defense use. [Insert the legal name (a) A Rating Authorization is an
distribution of a material in the civilian of the person receiving the order] is required official action granting specific priority
market, unless the Secretary has:
to comply with this order, in accordance rating authority that:
with the provisions of the Health Resources (1) Permits a person to place a priority
(1) Made a written finding that: Priorities and Allocations System regulation rating on an order for an item or service
(i) Such material is a scarce and (45 CFR part 101, subpart A), which is part not normally ratable under this part; or
critical material essential to the national of the Federal Priorities and Allocations (2) Authorizes a person to modify a
defense, and System; and priority rating on a specific order or
(ii) The requirements of the national
series of contracts or orders.
defense for such material cannot (e) A current copy of the Health
(b) To request priority rating
otherwise be met without creating a Resources Priorities and Allocations
authority, see § 101.41.
significant dislocation of the normal System regulation (subpart A of this
distribution of such material in the part). § 101.62 Directives.
civilian market to such a degree as to (a) A Directive is an official action
§ 101.55 Mandatory acceptance of an
create appreciable hardship; allocation order. that requires a person to take or refrain
(2) Submitted the finding for the from taking certain actions in
President’s approval through the (a) Except as otherwise specified in accordance with its provisions.
Assistant to the President for National this section (see paragraph (c) of this (b) A person must comply with each
Security Affairs; and section), a person shall accept and Directive issued. However, a person
(3) The President has approved the comply with every allocation order may not use or extend a Directive to
finding. received. obtain any items from a supplier, unless
(b) The requirements of this section (b) A person shall not discriminate expressly authorized to do so in the
may not delegated by the Secretary (See against an allocation order in any Directive.
E.O. 13603, Section 201(e)). manner such as by charging higher (c) A Priorities Directive takes
prices for materials, services, or precedence over all DX-rated orders,
§ 101.53 Types of allocation orders.
facilities covered by the order or by DO-rated orders, and unrated orders
There are three types of allocation previously or subsequently received,
imposing terms and conditions for
orders available for communicating unless a contrary instruction appears in
contracts and orders involving allocated
allocation actions. These are: the Directive.
materials, services, or facilities that
(a) Set-aside. An official action that (d) An Allocations Directive takes
differ from the person’s terms and
requires a person to reserve materials, precedence over all Priorities Directives,
conditions for contracts and orders for
services, or facilities capacity in DX-rated orders, DO-rated orders, and
the materials, services, or facilities prior
anticipation of the receipt of rated unrated orders previously or
to receiving the allocation order.
orders; subsequently received, unless a contrary
(b) Directive. An official action that (c) If a person is unable to comply instruction appears in the Directive.
requires a person to take or refrain from fully with the required action(s)
taking certain actions in accordance specified in an allocation order, the § 101.63 Letters and Memoranda of
with its provisions. A directive can person must notify the Secretary, as Understanding.
require a person to: Stop or reduce specified in § 101.93, immediately, (a) A Letter or Memorandum of
production of an item; prohibit the use explain the extent to which compliance Understanding is an official action that
of selected materials, services, or is possible, and give the reasons why may be issued in resolving special
facilities; or divert the use of materials, full compliance is not possible. If priorities assistance cases to reflect an
services, or facilities from one purpose notification is given verbally, written or agreement reached by all parties
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to another; and electronic confirmation must be including HHS, the Department of
(c) Allotment. An official action that provided within five (5) working days. Commerce (if applicable), a Delegate
specifies the maximum quantity of a Such notification does not release the Agency (if applicable), the supplier, and
material, service, or facility authorized person from complying with the order the customer).
for a specific use. to the fullest extent possible, until the (b) A Letter or Memorandum of
person is notified by the Department of Understanding is not used to alter
§ 101.54 Elements of an allocation order. Health and Human Services that the scheduling between rated orders, to
Each allocation order must include: order has been changed or cancelled. authorize the use of priority ratings, to
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(d) In addition, persons must develop, Dated: March 3, 2015. DATES: This rule is effective August 17,
maintain, and submit any other records Sylvia M. Burwell, 2015.
and reports to HHS that may be required Secretary. ADDRESSES: Electronic copies of
for the administration of the DPA and Editorial note: This document was Amendment 8, which includes an
other applicable statutes, and this part. received by the Office of the Federal Register environmental assessment and a
(e) DPA Section 705(d), as on July 8, 2015. regulatory impact review, may be
implemented by E.O. 13603, provides [FR Doc. 2015–17047 Filed 7–16–15; 8:45 am]
obtained from the Southeast Regional
that information obtained under this BILLING CODE 4150–28–P
Office Web site at http://
sero.nmfs.noaa.gov/sustainable_
section which the Secretary deems
fisheries/s_atl/coral/index.html.
confidential, or with reference to which
Comments regarding the burden-hour
a request for confidential treatment is DEPARTMENT OF COMMERCE estimates or other aspects of the
made by the person furnishing such collection-of-information requirements
information, shall not be published or National Oceanic and Atmospheric
Administration contained in this final rule may be
disclosed unless the Secretary submitted in writing to Anik Clemens,
determines that the withholding of this Southeast Regional Office, NMFS, 263
50 CFR Part 622
information is contrary to the interest of 13th Avenue South, St. Petersburg, FL
the national defense. Information [Docket No. 140214145–5582–02] 33701; and OMB, by email at OIRA
required to be submitted to HHS in RIN 0648–BD81 Submission@omb.eop.gov, or by fax to
connection with the enforcement or 202–395–7285.
administration of the DPA, this part, or Fisheries of the Caribbean, Gulf of FOR FURTHER INFORMATION CONTACT:
an official action, is deemed to be Mexico, and South Atlantic; Coral, Karla Gore, Southeast Regional Office,
confidential under DPA Section 705(d) Coral Reefs, and Live/Hard Bottom telephone: 727–824–5305.
and shall be handled in accordance with Habitats of the South Atlantic Region; SUPPLEMENTARY INFORMATION: South
applicable Federal law. Amendment 8 Atlantic coral is managed under the
AGENCY: National Marine Fisheries FMP. The FMP is implemented under
§ 101.92 Applicability of this part and
official actions. Service (NMFS), National Oceanic and the authority of the Magnuson-Stevens
Atmospheric Administration (NOAA), Fishery Conservation and Management
(a) This part and all official actions, Commerce. Act (Magnuson-Stevens Act) by
unless specifically stated otherwise, ACTION: Final rule. regulations at 50 CFR part 622.
apply to transactions in any state, On May 20, 2014, NMFS published a
territory, or possession of the United SUMMARY: NMFS issues this final rule to notice of availability for Amendment 8
States and the District of Columbia. implement Amendment 8 to the Fishery and requested public comment (79 FR
Management Plan for Coral, Coral Reefs, 28880). On July 3, 2014, NMFS
(b) This part and all official actions and Live/Hard Bottom Habitats of the published a proposed rule for
apply not only to deliveries to other South Atlantic Region (FMP) Amendment 8 and requested public
persons but also include deliveries to (Amendment 8), as prepared by the comment (79 FR 31907). Subsequently,
affiliates and subsidiaries of a person South Atlantic Fishery Management NMFS published a correction to the
and deliveries from one branch, Council (Council). This final rule notice of availability (79 FR 37269, July
division, or section of a single entity to expands portions of the northern and 1, 2014) and the proposed rule (79 FR
another branch, division, or section western boundaries of the Oculina Bank 37270, July 1, 2014) to correct an error
under common ownership or control. Habitat Area of Particular Concern in the size of the Oculina Bank HAPC.
(c) This part and its schedules shall (HAPC) (Oculina Bank HAPC) and The proposed rule and NOA stated that
not be construed to affect any allows transit through the Oculina Bank the size of the Oculina Bank HAPC
administrative actions taken by HHS, or HAPC by fishing vessels with rock would expand ‘‘by 405.42 square miles
any outstanding contracts or orders shrimp onboard; modifies vessel (1,050 square km), for a total area of
placed pursuant to any of the monitoring system (VMS) requirements 694.42 square miles (1,798.5 square km)
regulations, orders, schedules or for rock shrimp fishermen transiting . . .’’ However, this was incorrect. The
delegations of authority previously through the Oculina Bank HAPC with published corrections explained that the
issued by HHS pursuant to authority rock shrimp on aboard; expands a increase in size of the Oculina Bank
granted to HHS, by the President under portion of the western boundary of the HAPC would be 343.42 square miles
the DPA and E.O. 13603. Such actions, Stetson Reefs, Savannah and East (889.5 square km), for a total area of
Florida Lithoherms, and Miami Terrace 632.42 square miles (1,638 square km).
contracts, or orders shall continue in
Deepwater Coral HAPC (CHAPC) The Secretary approved the amendment
full force and effect under this part
(Stetson-Miami Terrace CHAPC), on August 18, 2014. The proposed rule
unless modified or terminated by proper
including modifications to the shrimp and Amendment 8 set forth the rationale
authority. access area A, which is renamed for the actions contained in this final
§ 101.93 Communications. ‘‘shrimp access area 1’’; and expands a rule. A summary of the actions
portion of the northern boundary of the implemented by this final rule is
All communications concerning this Cape Lookout Lophelia Banks provided below.
asabaliauskas on DSK5VPTVN1PROD with RULES
part, including requests for copies of the Deepwater CHAPC (Cape Lookout
part and explanatory information, CHAPC). In addition, this rule makes a Management Measures Contained in
requests for guidance or clarification, minor administrative change to the This Final Rule
and requests for adjustment or names of the shrimp fishery access This final rule expands the
exception shall be addressed to the areas. The purpose of this rule is to boundaries of the Oculina Bank HAPC
Secretary, U.S. Department of Health increase protections for deepwater coral and allows transit through the Oculina
and Human Services, and Washington, based on new information for deepwater Bank HAPC by fishing vessels with rock
DC. coral resources in the South Atlantic. shrimp onboard; modifies the VMS
VerDate Sep<11>2014 17:58 Jul 16, 2015 Jkt 235001 PO 00000 Frm 00051 Fmt 4700 Sfmt 4700 E:\FR\FM\17JYR1.SGM 17JYR1](https://thefederalregister.org/doc/80_FR_42545/page/16.svg)
Document Created: 2018-02-23 09:21:32
Document Modified: 2018-02-23 09:21:32
| Category | Regulatory Information | |
| Collection | Federal Register | |
| sudoc Class | AE 2.7: GS 4.107: AE 2.106: | |
| Publisher | Office of the Federal Register, National Archives and Records Administration | |
| Section | Rules and Regulations | |
| Action | Interim final rule. | |
| Dates | Effective July 17, 2015. Comments must be received by September 15, 2015. | |
| Contact | The agency program contact is Cassandra R. Freeman, who can be contacted by phone at (202) 205-1855 or via email at [email protected] | |
| FR Citation | 80 FR 42408 | |
| RIN Number | 0991-AB94 | |
| CFR Associated | Administrative Practice and Procedure; Business and Industry; Government Contracts; National Defense; Reporting and Recordkeeping Requirements and Strategic and Critical Materials |
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