The Morning Federal Newscast is a daily compilation of the stories you hear Federal Drive hosts Tom Temin and Amy Morris discuss throughout the show each day. The Newscast is designed to give FederalNewsRadio.com users more information about the stories you hear on the air.

• Federal agency hiring, retention and bonuses rose despite a down economy, according to a new report from the Office of Personnel Management. OPM said agencies spent nearly $350 million in 2009 on recruitment, relocation and retention bonuses, with the largest share going to medical workers, engineers and patent examiners. The Defense and Veterans Affairs Departments far outspent others on incentives. (Federal News Radio)
• Hundreds of millions of dollars in construction planned for the Bethesda Walter Reed National Military Medical Center is now on hold, The Washington Examiner reports. The Defense Department must first spend another $37 million to expand the center’s overloaded power grid, after a substation at the National Institutes of Health reached capacity. (Washington Examiner)
• The head of the Alcohol, Tobacco, Firearms and Explosives Bureau is resigning. Kenneth Melson, who had been serving as ATF’s acting director, is one of three high level ATF officials to leave or be reassigned in wake of a botched program to trace weapons sold in Mexico. Also stepping down is Dennis Burke, U.S. attorney in Arizona. A federal prosecutor in Phoenix, Ariz., Emory Hurley, will now work on civil cases. Melson will be replaced by B. Todd Jones, now the U.S. attorney in Minnesota. Melson will become a senior adviser on forensic science at the Justice Department. The failed program at the heart of the controversy was known as “Fast and Furious.” The government sold high powered weapons to gun runners to eventually trace them in the U.S. However, some of the weapons were eventually used to kill U.S. agents. (Federal News Radio)
• The Commission on Wartime Contracting delivers its final report to Congress today. It found as much as $60 billion has been lost to waste and fraud in Iraq and Afghanistan, amounting to nearly 30 percent of the money spent to build schools, hospitals, roads and power plants in those countries. The commission recommends appointment of a permanent inspector general and more management oversight of overseas contracting. Congress established the commission in 2008, which will cease operations at the end of September. (Federal News Radio)
• Companies that win established contracts must hire its predecessors’ employees, under a new final rule issued by the Labor Department. The rule applies to service contracts valued at more than $150,000 dollars. The Labor Department estimates 40,000 contractors and subcontractors will be subject to the rule every year. Federal contracting officers will help determine which employees will stay on the jobs when contract work changes hands — but managers or supervisors must stay put. The rule stems from a 2009 executive order to retain experienced workers during a contractor transition, however, the move was highly contested by industry groups.(Federal Register)
• Science Applications International Corp warns that 83 potential layoffs in its Bethesda, Md., office could be coming — if a federal contract is not renewed. The Baltimore Business Journal reports that SAIC has filed a letter with the state’s labor department, saying that those jobs will be lost if a contract with the National Institutes of Health Center for Information Technology is not renewed. The cuts would begin on October 28th. (Baltimore Business Journal)
• The federal government is handing a small piece of financial relief to state and local governments. The Transportation Department has proposed eliminating 46 regulations forcing the replacement of road signs. Transportation Secretary Ray LaHood said getting rid of the regulations is common sense, because it should be up to local road officials when to replace worn or faded signs. The move is part of the administration’s effort to trim back the federal regulatory machinery. The proposal would cancel deadlines for replacing Pass-with-care, One-Way and other warning signs with bigger and shinier ones. (Federal Highway Administration)
• The Bureau of Ocean Energy Management, Regulation and Enforcement has beefed up its online presence. The agency wants to make it easier for offshore drilling companies to comply with new regulations. Drillers can now track the status of applications using a tool called e-Wells. The bureau has also added fact sheets and frequently-asked questions to help operators make sure their applications are complete. Among the new rules is one requiring operators to demonstrate they’re prepared to handle worst-case blowout scenarios. The bureau also toughened standards for worker safety on offshore drilling platforms. Many of the reforms were enacted after last year’s BP oil spill in the Gulf of Mexico. (Bureau of Ocean Energy Management, Regulation and Enforcement)

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