SECTION 1. REVISED GUIDANCE, TERMS OF REFERENCE, AND OBJECTIVES FOR 
              DEPARTMENT OF DEFENSE WORKING GROUP REVIEWING POSSIBLE 
              REPEAL OF CURRENT POLICY CONCERNING HOMOSEXUALITY IN THE 
              ARMED FORCES.

    (a) Modification of Guidance and Terms of Reference.--
            (1) Modification required.--As specified in paragraph (2) 
        and subsection (b), the Secretary of Defense shall modify the 
        guidance and terms of reference issued on March 2, 2010, in 
        connection with the establishment of the Department of Defense 
        working group (in this section referred to as the ``working 
        group'') to conduct a comprehensive review of the possible 
        repeal of section 654 of title 10, United States Code, which 
        codifies United States policy concerning homosexuality in the 
        Armed Forces (in this section referred to as ``section 654'').
            (2) Evaluation.--In making the modifications required by 
        paragraph (1), the Secretary shall ensure that the final report 
        of the working group provides a comprehensive and objective 
        evaluation of--
                    (A) whether application of section 654 has or is 
                undermining military readiness in any significant way;
                    (B) whether repeal or amendment of section 654 will 
                improve military readiness in significant, measurable 
                ways; and
                    (C) what the implications for and effects on 
                military readiness, cohesion, morale, good order, and 
                discipline are entailed as a result of repeal or 
                amendment of section 654.
            (3) Scope of evaluation.--The evaluation described in 
        paragraph (2) shall encompass the regular and reserve 
        components, military family members and dependents, and matters 
        of expanded eligibility of retirees and their families and 
        dependents for Federal benefits as a result of military service 
        before any repeal of such section.
    (b) Expanded Objectives.--In addition to the requirements 
established by the terms of reference issued on March 2, 2010, the 
working group shall examine and report to the Secretary of Defense on 
the following matters:
            (1) Whether the findings contained in subsection (a) of 
        section 654 remain valid.
            (2) Whether section 654 has hindered, in a measurably 
        significant way, the ability of the Armed Forces to recruit and 
        retain a sufficient number of qualified personnel to meet 
        service manpower requirements.
            (3) Whether section 654 has hindered the ability of any 
        component, especially the Army, the Marine Corps, and the Army 
        National Guard, to increase manpower, especially during 
        wartime.
            (4) Whether the discharge of personnel under section 654 
        has had a measurably significant impact on military readiness 
        or on the ability of the Armed Forces to carry out their 
        wartime missions since September 11, 2001.
            (5) Given the numbers of personnel discharged under section 
        654 since enactment of the section on November 30, 1993, 
        compared to the total number of personnel separated from the 
        Armed Forces for all reasons since that date, whether 
        discharges under section 654 have been a significant source of 
        attrition for the Armed Forces.
            (6) Whether repeal of section 654 is a military necessity 
        for sustaining future military readiness and effectiveness.
            (7) The extent to which, and how, repeal of section 654 
        would improve military readiness, cohesion, morale, good order, 
        and discipline.
            (8) The extent to which repeal of section 654 would have 
        negative impacts on military readiness, cohesion, morale, good 
        order, and discipline; the nature and extent of the negative 
        impacts; whether the negative impacts would be of short 
        duration or an extended duration; and what measures will be 
        necessary to negate or mitigate the anticipated negative 
        impacts of repeal.
            (9) Whether, and how, repeal of section 654 would improve 
        military family readiness, and the measures necessary to ensure 
        that a repeal of section 654 would not degrade military family 
        readiness.
            (10) The extent to which repeal of section 654 would affect 
        the propensity of prospective recruits to enlist in the Armed 
        Forces and the propensity of influencers (such as parents, 
        coaches, teachers, and religious leaders) to recommend military 
        service.
            (11) The extent to which repeal of section 654 would affect 
        retention, especially whether repeal of section 654 would 
        significantly improve the ability of the Armed Forces to retain 
        personnel to meet manpower requirements.
            (12) Assuming repeal of section 654, the extent to which 
        pay and benefits (such as health care, military housing, and 
        survivor benefits) and other support (such as spouse employment 
        preferences, education and training, and dependent education) 
        currently provided by the Department of Defense to married 
        couples and families should be provided to the domestic 
        partners, spouses and dependents of gay and lesbian personnel, 
        and the extent to which those benefits should be any different 
        than the benefits provided to military spouses and dependents, 
        and the extent to which those benefits could be provided by 
        policy or executive order without statutory changes.
            (13) The extent to which Federal laws, including those 
        regulating the Department of Veterans Affairs, the Department 
        of Education, and the Department of Health and Human Services, 
        the Uniform Code of Military Justice, and Department of Defense 
        and Department of Veterans affairs policies would have to be 
        changed in order for a repeal of section 654 to be effective in 
        promoting the readiness, morale, cohesion, welfare and 
        discipline of members of the Armed Forces and their families 
        and dependents.
            (14) Whether a statute prohibiting discrimination on the 
        basis of sexual orientation, such as proposed in H.R. 1283 of 
        the 111th Congress, would be necessary or desirable as part of 
        the repeal of section 654; and, if the nondiscrimination policy 
        set out in such bill were enacted into law, given such bill's 
        proposed statutory definition of sexual orientation, an 
        evaluation of--
                    (A) the Department of Defense and Armed Forces 
                polices that would have to be changed and the nature of 
                the changes;
                    (B) the legal and practical implementation 
                challenges associated with such changes, especially for 
                commanders and leaders;
                    (C) the measures required to overcome those 
                challenges; and
                    (D) the effect such a nondiscrimination statute 
                would have on current military billeting and housing 
                policies and practices.
            (15) Assuming repeal of section 654--
                    (A) whether the Defense of Marriage Act (Public Law 
                104-199; 1 U.S.C. 7) and the associated provision of 
                such H.R. 1283 would create a significant difference in 
                the pay, benefits, and other forms of support from the 
                Department of Defense, the Department of Veterans 
                Affairs, and other Federal departments that could be 
                provided to legally married heterosexual military 
                couples, families and dependents and the pay, benefits, 
                and other forms of support that could be provided to 
                legally married military gay couples, families and 
                dependents;
                    (B) explain the nature and extent of those 
                differences;
                    (C) explain the extent to which the limitations on 
                benefits resulting from the Defense of Marriage Act 
                would affect military readiness, cohesion, morale, and 
                good order and discipline; and
                    (D) explain the extent to which this diversity of 
                benefits would affect military family readiness, 
                morale, welfare, and cohesion.
            (16) To effectively implement a repeal of section 654, 
        whether the Defense of Marriage Act should be repealed or 
        amended, and explain the basis for the conclusion.
            (17) The extent to which, and the nature and objectives of, 
        education and training measures and programs that would be 
        required, upon repeal of section 654, for members of the Armed 
        Forces, their families, and dependents.
            (18) The projected costs of a repeal of section 654, 
        including costs attributable to changes in military barracks, 
        housing policies, and military construction considered 
        necessary to accommodate various sexual orientations.
            (19) The extent to which, upon repeal of section 654, gay 
        and lesbian military retirees, their families, and dependents 
        should be made eligible retroactively for Federal benefits in 
        the same manner as the benefits received by heterosexual 
        military retirees, their families, and dependents as a result 
        of service in the Armed Forces, and if so, what benefits should 
        be provided and at what estimated cost.
    (c) Methodology.--
            (1) Use of in-house resources.--The surveys, polling, 
        studies, updates or revisions, and analysis conducted by or for 
        the working group, and instruments designed to conduct such 
        surveys, polling, studies, updates or revisions, and analysis, 
        shall primarily, if not exclusively, employ the in-house 
        capabilities of the Department of Defense.
            (2) Restriction.--If the Secretary of Defense or the 
        working group determines that required surveys, polling, focus 
        groups, and analysis cannot be conducted solely using in-house 
        capabilities of the Department of Defense, the Secretary and 
        the working group may not for those purposes employ, or use the 
        survey instruments or data from, any organization that has 
        previously done any survey, polling, or analysis work on 
        matters related to a potential repeal of section 654 or the 
        Department of Defense policy that preceded enactment of section 
        654.
    (d) Revised Reporting Requirement and Time Lines.--Not later than 
six months after the working group provides its final report to the 
Secretary of Defense, the Secretary shall submit to the Committees on 
Armed Services of the House of Representatives and the Senate a report 
containing--
            (1) the report and recommendations of the working group, as 
        modified as required by subsections (a) and (b);
            (2) the comments and recommendations of the Chief of Staff 
        of the Army, the Chief of Naval Operations, the Chief of Staff 
        of the Air Force, and the Commandant of the Marine Corps 
        regarding the conclusions and recommendations of the working 
        group; and
            (3) the conclusions and recommendations of the Secretary of 
        Defense, including a comprehensive proposal for all Federal 
        legislation required to be enacted or amended should section 
        654 be repealed.
Directs the Secretary of Defense to modify the guidance and terms of reference issued in connection with the establishment of a Department of Defense (DOD) working group tasked to conduct a review of the possible repeal of federal law containing the U.S. policy concerning homosexuality in the Armed Forces (commonly referred to as the Don't Ask, Don't Tell policy). Requires the final report of the working group to include an evaluation of: (1) whether the current policy is significantly undermining military readiness; (2) whether its repeal will significantly improve military readiness; and (3) what implications for and effects on military readiness, cohesion, morale, good order, and discipline are entailed as a result of its repeal or amendment. Outlines expanded report objectives, including determining the policy's effect on recruitment and manpower requirements.

Requires the Secretary, after the final report of the working group, to report to the congressional defense committees on the working group's report and recommendations, the Secretary's conclusions and recommendations, and the comments and recommendations of the chiefs of staff of the military departments.
To establish additional research, study, and reporting requirements for the Department of Defense working group reviewing the possible repeal of current United States policy concerning homosexuality in the Armed Forces, referred to as Don't Ask, Don't Tell and codified as section 654 of title 10, United States Code.