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Panoptic Enterprises' FEDERAL CONTRACTS DISPATCH

DATE: April 1, 2002

SUBJECT: Department of Energy Acquisition Regulation (DEAR); Assessment of Civil Penalties for Classified Information Security Violations

SOURCE: Federal Register, April 1, 2002, Vol. 67, No. 62, page 15339

AGENCIES: Department of Energy (DOE)

ACTION: Notice of Proposed Rulemaking (NPRM) and Notice of Public Hearing

SYNOPSIS: DOE is proposing regulations to implement Section 234B of the Atomic Energy Act of 1954, which was added by Section 3147 of the National Defense Authorization Act for Fiscal Year 2000 (Public Law 106-65). Section 234B subjects contractors and others working for DOE to civil penalties for violations of DOE rules, regulations, and orders regarding the safeguarding and security of "Restricted Data" and other classified information.

EDITOR'S NOTE: For more on a recent revision of the DOE Acquisition Regulation (DEAR) to implement Executive Order 12829, National Industrial Security Program (NISP), see the March 28, 2002, FEDERAL CONTRACTS DISPATCH "Department of Energy Acquisition Regulation (DEAR); National Industrial Security Program."

DATES: Seven copies of comments are to be submitted no later than July 1, 2002. Public hearings will be held in Las Vegas, NV on May 22, 2002, from 9:30 a.m. until 12:30 p.m., and in Washington, DC on May 29, 2002, from 9:30 a.m. until 12:30 p.m. Requests to speak at the Las Vegas hearing must be submitted no later than May 15, 2002, and requests to speak at the Washington, DC hearing must be submitted no later than May 22, 2002. Requests to make oral presentations should contain a telephone number where the requester may be contacted prior to the hearing. Speakers are requested to submit seven copies of their statement to DOE at the hearings.

ADDRESSES: Address comments to Geralyn C. Praskievicz, Office of Security, SO-1, Docket No. SO-RM-00-01, U.S. Department of Energy, 1000 Independence Ave., SW, Washington, DC 20585.

The public hearings will be held at the U.S. Department of Energy, National Nuclear Security Administration, Nevada Operations Office, 232 Energy Way, Room A107, Las Vegas, NV, and at the U.S. Department of Energy, James Forrestal Building, 1000 Independence Avenue SW, Room GE-086, Washington, DC. DOE reserves the right to select the persons to be heard at the hearings, to schedule their respective presentations, and to establish the procedures governing the conduct of the hearings. The length of each presentation is limited to fifteen minutes. These will not be judicial-type hearings. Questions may be asked only by those conducting the hearing.

FOR FURTHER INFORMATION CONTACT: Geralyn Praskievicz, Office of Security, SO-1, U.S. Department of Energy, 1000 Independence Ave., SW, Washington, DC 20585, 202-586-4451; or Jo Ann Williams, Office of General Counsel, GC-53, U.S. Department of Energy, 1000 Independence Ave., SW, Washington, DC 20585, 202-586-6899.

SUPPLEMENTAL INFORMATION: Subsection a. of new Section 234B of the Atomic Energy Act provides that any person who (1) has entered into a contract or agreement with DOE, or a subcontract or subagreement thereto, and (2) violates (or whose employee violates) any applicable rule, regulation, or order prescribed or otherwise issued by the secretary of energy in accordance with the Atomic Energy Act relating to the safeguarding or security of Restricted Data or other classified or "sensitive information" is be subject to a civil penalty not to exceed $100,000 for each such violation.

DOE is proposing to establish a new Part 824 in Title 10 of the Code of Federal Regulations (CFR) to implement Subsection a. and all other subsections of Section 234B of Section 234B of the Atomic Energy Act, (except Subsection b. -- see "EDITOR'S NOTE" below) with respect to contractors of DOE, including those of the National Nuclear Security Administration (NNSA) (which was established as an agency within DOE under Public Law 106-65). The following are the contents of the proposed 10 CFR 824, Procedural Rules for the Assessment of Civil Penalties For Classified Information Security Violations:

     824.1Purpose and Scope
     824.2Applicability
     824.3Definitions
     824.4Civil Penalties
     824.5Notice of Violation
     824.6Investigations
     824.7Hearing
     824.8Hearing Counsel
     824.9Hearing Officer
     824.10Rights of the Person at the Hearing
     824.11Conduct of the Hearing
     824.12Initial Decision
     824.13Final Order
     824.14Special Procedures
     824.15Collection of Civil Fines

The following explains the provisions of the three most significant provisions of 10 CFR Part 824: