A bill to authorize the Secretary of Energy to enter into privatization arrangements for activities carried out in connection with defense nuclear facilities, and for other purposes.

SECTION 1. PRIVATIZATION OF WASTE CLEANUP AND MODERNIZATION ACTIVITIES 
              OF DEFENSE NUCLEAR FACILITIES.

    (a) Contract Authority.--Notwithstanding any other law, the 
Secretary of Energy may enter into 1 or more long-term contracts for 
the procurement, from a facility located within 25 miles of a current 
or former Department of Energy defense nuclear facility, of products 
and services that are determined by the Secretary to be necessary to 
support waste cleanup and modernization activities at such facilities, 
including the following services and related products:
            (1) Waste remediation and environmental restoration, 
        including treatment, storage, and disposal.
            (2) Technical services.
            (3) Energy production.
            (4) Utility services.
            (5) Effluent treatment.
            (6) General storage.
            (7) Fabrication and maintenance.
            (8) Research and testing.
    (b)  Contract Provisions.--A contract under subsection (a)--
            (1) shall be for a term of not more than 30 years;
            (2) shall include options for 2 10-year extensions of the 
        contract;
            (3) when nuclear or hazardous material is involved, shall 
        include an agreement to--
                    (A) provide indemnification pursuant to section 
                170d. of the Atomic Energy Act of 1954 (42 U.S.C. 
                2210(d));
                    (B) indemnify, protect, and hold harmless the 
                contractor from and against all liability, including 
                liability for legal costs, relating to any preexisting 
                conditions at any part of the defense nuclear facility 
                managed under the contract;
                    (C) indemnify, protect, and hold harmless the 
                contractor from and against all liability to third 
                parties, including liability for legal costs, relating 
                to claims for personal injury, illness, property 
                damage, and consequential damages; and
                    (D) provide for indemnification of subcontractors 
                as described in subparagraphs (A), (B), and (C);
            (4) shall permit the contractor (in accordance with Federal 
        law) to obtain a patent for and use for commercial purposes a 
        technology developed by the contractor in the performance of 
        the contract;
            (5) shall not provide for payment to the contractor of cost 
        plus a percentage of cost or cost plus a fixed fee; and
            (6) shall include such other terms and conditions as the 
        Secretary of Energy considers appropriate to protect the 
        interests of the United States.
    (c) Preference for Local Residents.--In entering into contracts 
under subsection (a), the Secretary of Energy shall give preference, 
consistent with Federal, State, and local law, to entities that plan to 
hire, to the maximum extent practicable, residents of the vicinity of 
the Department of Energy defense nuclear facility concerned and to 
persons who have previously been employed by the Department of Energy 
or its private contractor at the facility.
    (d) Subsequently Enacted Requirements.--
            (1) Definition.--In this subsection, the term ``applicable 
        requirement'' means a requirement in an Act of Congress or 
        regulation that applies specifically to activities described in 
        subsection (a).
            (2) Increased costs.--
                    (A) In general.--A contractor under a contract 
                under subsection (a) shall be exempt from an applicable 
                requirement that would increase the cost of performing 
                the contract that is--
                            (i) imposed by regulation by a Federal, 
                        State, or local governmental agency after the 
                        date on which the contract is entered into 
                        unless the regulation is issued under an Act of 
                        Congress described in the exception stated in 
                        clause (ii); or
                            (ii) imposed by an Act of Congress enacted 
                        after the date of enactment of this Act, except 
                        an Act of Congress that refers to this 
                        paragraph and explicitly states that it is the 
                        intent of Congress to subject such a contractor 
                        to the requirement.
                    (B) Amendment of contract.--In the case of 
                enactment of an Act of Congress described in the 
                exception stated in subparagraph (A)(ii), the Secretary 
                of Energy and the contractor shall negotiate an 
                amendment to a contract under subsection (a) providing 
                full compensation to the contractor for the increased 
                cost incurred in order to comply with any additional 
                requirement of law.
            (3) Reduced costs.--
                    (A) In general.--A contractor under a contract 
                under subsection (a) may elect to be governed by a 
                change in a requirement that would reduce the cost of 
                performing the contract that is--
                            (i) adopted by regulation by a Federal, 
                        State, or local governmental agency after the 
                        date on which the contract is entered into, 
                        unless the change is made pursuant to an Act of 
                        Congress that refers to this paragraph and 
                        explicitly states that it is the intent of 
                        Congress to continue to subject such a 
                        contractor to that requirement, as in effect 
                        prior to the date of enactment of that Act of 
                        Congress; or
                            (ii) enacted by an Act of Congress enacted 
                        after the date of enactment of this Act, except 
                        an Act of Congress that refers to this 
                        paragraph and explicitly states that it is the 
                        intent of Congress to continue to subject such 
                        a contractor to that requirement, as in effect 
                        prior to the date of enactment of that Act of 
                        Congress.
                    (B) Amendment of contract.--In the case of a change 
                in a requirement that is to be applied to a contractor 
                that will reduce the cost of performing the contract, 
                the Secretary of Energy and the contractor shall 
                negotiate an amendment to a contract under subsection 
                (a) providing for a reduction in the amount of 
                compensation to be paid to the contractor commensurate 
                with the amount of any reduction in costs resulting 
                from the change.
    (e) Payment of Balance of Unamortized Costs.--
            (1) Definition.--In this subsection, the term ``special 
        facility'' means land, a depreciable building, structure, or 
        utility, or depreciable machinery, equipment, or material that 
        is not supplied to a contractor by the Department of Energy.
            (2) Contract term.--A contract under subsection (a) may 
        provide that if the contract is terminated for the convenience 
        of the Government, the Secretary of Energy shall pay the 
        unamortized balance of the cost of any special facility 
        acquired or constructed by the contractor for performance of 
        the contract.
            (3) Source of funds.--The Secretary of Energy may make a 
        payment under a contract term described in paragraph (2) and 
        pay any other costs assumed by the Secretary as a result of the 
        termination out of any appropriations that are available to the 
        Department of Energy for operating expenses for the fiscal year 
        in which the termination occurs or for any subsequent fiscal 
        year.
    (f) Lease of Federally Owned Land.--
            (1) In general.--Notwithstanding any other provision of 
        law, the Secretary of Energy may lease federally owned land at 
        a current or former Department of Energy defense nuclear 
        facility to a contractor in order to provide for or to 
        facilitate the construction of a facility in connection with a 
        contract under subsection (a).
            (2) Term.--The term of a lease under this paragraph shall 
        be the lesser of--
                    (A) the expected useful life of the facility to be 
                constructed; or
                    (B) the term of the contract.
            (3) Terms and conditions.--A lease under paragraph (1) 
        shall--
                    (A) require the contractor to pay rent in amounts 
                that the Secretary of Energy considers to be 
                appropriate; and
                    (B) include such other terms and conditions as the 
                Secretary of Energy considers to be appropriate.
    (g) Nuclear Standards.--The Secretary of Energy shall, whenever 
practicable, consider applying commercial nuclear standards to a 
facility used in the performance of a contract under subsection (a).
    (h) Limitation on Liability.--
            (1) Definitions.--In this subsection, the terms ``hazardous 
        substance'', ``pollutant or contaminant'', ``release'', and 
        ``response'' have the meanings stated in section 101 of the 
        Comprehensive Environmental Response, Compensation, and 
        Liability Act of 1980 (42 U.S.C. 9601).
            (2) In general.--A contractor under a contract under 
        subsection (a) or a subcontractor of the contractor shall not 
        be liable under Federal, State, or local law for any injury, 
        cost, damage, expense, or other relief on a claim by any person 
        for death, personal injury, illness, loss of or damage to 
        property, or economic loss caused by a release or threatened 
        release of a hazardous substance or pollutant or contaminant 
        during performance of the contract unless the release or 
        threatened release is caused by conduct of the contractor or 
        subcontractor that is negligent or that constitutes intentional 
        misconduct.
            (3) Repose.--No action (including an action for 
        contribution or indemnity) to recover for damage to real or 
        personal property, economic loss, personal injury, illness, 
        death, or other expense or cost arising out of the performance 
        under this section of a response action under a contract under 
        subsection (a) may be brought against the contractor (or 
        subcontractor of the contractor) under Federal, State, or local 
        law after the date that is 6 years after the date of 
        substantial completion of the response action.

SEC. 2. PREFERENCE AND ECONOMIC DIVERSIFICATION FOR COMMUNITIES AND 
              LOCAL RESIDENTS.

    (a) Definition.--In this section, the term ``qualifying Department 
of Energy site'' means a site that contains at least 1 current or 
former Department of Energy defense nuclear facility for which the 
Secretary of Energy is required by section 3161 of the National Defense 
Authorization Act for Fiscal Year 1993 (42 U.S.C. 7274h) to develop a 
plan for restructuring the work force.
    (b) Preference.--In entering into a contract with a private entity 
for products to be acquired or services to be performed at a qualifying 
Department of Energy site, the Secretary of Energy and contractors 
under the Secretary's supervision shall, to the maximum extent 
practicable, give preference to an entity that is otherwise qualified 
and within the competitive range (as determined under section 15.609 of 
title 48, Code of Federal Regulations, or a successor regulation, as in 
effect on the date of the determination) that plans to--
            (1) provide products and services originating from 
        communities within 25 miles of the site;
            (2) hire residents living in the vicinity of the site, 
        especially dislocated site workers, to perform the contract; 
        and
            (3) invest in value-added activities in the vicinity of the 
        site to mitigate adverse economic development impacts resulting 
        from closure or restructuring of the site.
    (c) Applicability.--Preference shall be given under subsection (b) 
only with respect to a contract for an environmental management and 
restoration activity that is entered into after the date of enactment 
of this Act.
    (d) Termination.--This section shall expire on September 30, 1999.

Summary: Authorizes the Secretary of Energy to enter into one or more contracts with facilities located within 25 miles of a current or former Department of Energy (DOE) defense nuclear facility for the procurement of products and services to support waste cleanup and modernization activities at such nuclear facilities. Requires the Secretary to give preference to facilities that plan to hire, to the maximum extent practicable, residents in the vicinity of the defense nuclear facility who are employed or who have previously been employed by DOE or its private contractor at the facility. Prohibits any person from bringing a claim against a contractor or subcontractor for injury, cost, damage, illness, death, damage to property, or economic loss caused by a release of a hazardous contaminant during performance of the contract, unless such release or threatened release is caused by contractor or subcontractor negligence or intentional misconduct. Sets forth a six year statute of limitations for commencement of such actions. Directs the Secretary and contractors under the Secretary's supervision, in entering into a contract or subcontract with a private entity for products to be acquired or services to be performed at a qualifying DOE site, to give preference to an entity that plans to: (1) provide products and services originating from communities within 25 miles of the site. (2) hire residents living in the site's vicinity to perform the contract. And (3) invest in value-added activities in the site's vicinity to mitigate adverse economic development impacts resulting from closure or restructuring of the site.