" ! COMMITTEE PRINT 

112TH CONGRESS

1st Session 

NO. 2B 

TITLE 10, UNITED STATES CODE 

ARMED FORCES 

(As Amended Through January 7, 2011) 

VOLUME II 

Subtitle A, General Military Law 

Parts III and IV (§§ 2001– 3000) 

PREPARED FOR THE USE OF THE

COMMITTEE ON ARMED SERVICES 

OF THE

HOUSE OF REPRESENTATIVES 

JULY 2011 

Printed for the use of the Committee on 

Armed Services of the House of Representatives 
TITLE 10, UNITED STATES CODE—ARMED FORCES 

(As Amended Through January 7, 2011) 

Vol. II—Subtitle A, Parts III and IV (§§ 2001–3000) 
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desired section by following the

black markers.

SUBTITLE A—GENERAL MILITARY LAW 

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Part IV—Service, Supply, and Procurement 

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" ! COMMITTEE PRINT 

112TH CONGRESS

1st Session 

NO. 2B 

2011

TITLE 10, UNITED STATES CODE 

ARMED FORCES 

(As Amended Through January 7, 2011) 

VOLUME II 

Subtitle A, General Military Law 

Parts III and IV (§§ 2001– 3000) 

PREPARED FOR THE USE OF THE

COMMITTEE ON ARMED SERVICES 

OF THE

HOUSE OF REPRESENTATIVES 

JULY 2011 

Printed for the use of the Committee on 

Armed Services of the House of Representatives 

http: //armedservices.house.gov 
HOUSE COMMITTEE ON ARMED SERVICES 

ONE HUNDRED TWELFTH CONGRESS

HOWARD P. ‘‘BUCK’’ MCKEON, California, Chairman 

ROSCOE G. BARTLETT, Maryland 

MAC THORNBERRY, Texas 

WALTER B. JONES, North Carolina 

W. TODD AKIN, Missouri 

J. RANDY FORBES, Virginia 

JEFF MILLER, Florida 

JOE WILSON, South Carolina 

FRANK A. LOBIONDO, New Jersey 

MICHAEL TURNER, Ohio 

JOHN KLINE, Minnesota 

MIKE ROGERS, Alabama 

TRENT FRANKS, Arizona 

BILL SHUSTER, Pennsylvania 

K. MICHAEL CONAWAY, Texas 

DOUG LAMBORN, Colorado 

ROB WITTMAN, Virginia 

DUNCAN HUNTER, California 

JOHN C. FLEMING, M.D., Louisiana 

MIKE COFFMAN, Colorado 

TOM ROONEY, Florida 

TODD RUSSELL PLATTS, Pennsylvania 

SCOTT RIGELL, Virginia 

CHRIS GIBSON, New York 

VICKY HARTZLER, Missouri 

JOE HECK, Nevada 

BOBBY SCHILLING, Illinois 

JON RUNYAN, New Jersey 

AUSTIN SCOTT, Georgia 

TIM GRIFFIN, Arkansas 

STEVEN PALAZZO, Mississippi 

ALLEN B. WEST, Florida 

MARTHA ROBY, Alabama 

MO BROOKS, Alabama 

TODD YOUNG, Indiana 

ADAM SMITH, Washington 

SILVESTRE REYES, Texas 

LORETTA SANCHEZ, California 

MIKE MCINTYRE, North Carolina 

ROBERT A. BRADY, Pennsylvania 

ROBERT ANDREWS, New Jersey 

SUSAN A. DAVIS, California 

JAMES R. LANGEVIN, Rhode Island 

RICK LARSEN, Washington 

JIM COOPER, Tennessee 

MADELEINE Z. BORDALLO, Guam 

JOE COURTNEY, Connecticut 

DAVE LOEBSACK, Iowa 

GABRIELLE GIFFORDS, Arizona 

NIKI TSONGAS, Massachusetts 

CHELLIE PINGREE, Maine 

LARRY KISSELL, North Carolina 

MARTIN HEINRICH, New Mexico 

BILL OWENS, New York 

JOHN R. GARAMENDI, California 

MARK S. CRITZ, Pennsylvania 

TIM RYAN, Ohio 

C.A. DUTCH RUPPERSBERGER, Maryland 

HANK JOHNSON, Georgia 

BETTY SUTTON, Ohio 

COLLEEN HANABUSA, Hawaii 

Vacant 

ROBERT L. SIMMONS II, Staff Director 

(ii) 
(iii) 

C O N T E N T S 

Page 

Table of chapters of title 10 [this volume] ................................ v 

Table of sections of title 10 [this volume] ................................. vii 

Title 10, United States Code ................................................. 1 

Subtitle A—General Military Law ................................... 5 

[NOTE: Parts I and II appear in Volume I of this 

publication] 

Part I—Organization and General Military Powers ......... 9 

Part II—Personnel ............................................................... 215 

Part III—Training and Education ...................................... 957 

Part IV—Service, Supply, and Procurement ..................... 1069 

[NOTE: The following appear in Volume III of this 

publication] 

Subtitle B—Army .................................................................. 1689 

Part I—Organization ........................................................... 1691 

Part II—Personnel ............................................................... 1717 

Part III—Training ................................................................ 1757 

Part IV—Service, Supply, and Procurement ..................... 1791 

Subtitle C—Navy and Marine Corps ............................... 1835 

Part I—Organization ........................................................... 1837 

Part II—Personnel ............................................................... 1873 

Part III—Education and Training ...................................... 1933 

Part IV—General Administration ...................................... 1979 

Subtitle D—Air Force .......................................................... 2067 

Part I—Organization ........................................................... 2069 

Part II—Personnel ............................................................... 2089 

Part III—Training ................................................................ 2125 

Part IV—Service, Supply, and Procurement ..................... 2169 

Subtitle E—Reserve Components .................................... 2207 

Part I—Organization and Administration ......................... 2209 

Part II—Personnel Generally ............................................. 2253 

Part III—Promotion and Retention of Officers on the 

Reserve Active-Status List .............................................. 2335 

Part IV—Training for Reserve Components and Educational Assistance Programs .......................................... 2389 

Part V—Service, Supply, and Procurement ....................... 2427 

Laws providing that certain provisions of title 10 are applicable to the Commissioned Corps of the Public Health 

Service and the National Oceanic and Atmospheric 

Administration ......................................................................... 2441 
(iv) 

For changes after the closing date of this publication (January 

7, 2011) to provisions of law contained in this publication, see the 

United States Code Classification Tables published by the Office of 

the Law Revision Counsel of the House of Representatives at 

http://uscode.house.gov/classification/tables.shtml. 
v 

1This table of chapters and the following table of sections are not part of title 10 and are 

included for the convenience of the reader. 

TABLE OF CHAPTERS OF TITLE 10 1

TITLE 10, UNITED STATES CODE 

ARMED FORCES 

[Subtitles of title 10] 

Subtitle Sec. 

A. GENERAL MILITARY LAW ..................................................................... 101 

B. ARMY .......................................................................................................... 3001 

C. NAVY AND MARINE CORPS .................................................................. 5001 

D. AIR FORCE ................................................................................................ 8001 

E. RESERVE COMPONENTS ....................................................................... 10001 

[Chapters of title 10] 

SUBTITLE A—GENERAL MILITARY LAW 

[NOTE: Parts I and II are set out in Volume I of this 

publication] 

PART III—TRAINING AND EDUCATION 

101. Training Generally .......................................................... 2001

102. Junior Reserve Officers’ Training Corps ....................... 2031

103. Senior Reserve Officers’ Training Corps ....................... 2101

104. Uniformed Services University of the Health Sciences 2112

105. Armed Forces Health Professions Financial Assistance Programs ............................................................. 2120

106. Educational Assistance for Members of the Selected 

Reserve ......................................................................... 2131

106A. Educational Assistance for Persons Enlisting for Active Duty ...................................................................... 2141

107. Professional Military Education .................................... 2151

108. Department of Defense Schools ..................................... 2161

109. Educational Loan Repayment Programs ...................... 2171

110. Educational Assistance for Members Held as Captives 

and Their Dependents ................................................. 2181

111. Support of Science, Mathematics, and Engineering 

Education ..................................................................... 2191

112. Information Security Scholarship Program .................. 2200
CHAPTERS OF TITLE 10 [this volume] vi 

PART IV—SERVICE, SUPPLY, AND PROCUREMENT 

131. Planning and Coordination ............................................ 2201

133. Facilities for Reserve Components ................................ 2231

134. Miscellaneous Administrative Provisions ..................... 2241

135. Space Programs ............................................................... 2271

136. Provisions Relating to Specific Programs ..................... 2281

137. Procurement Generally ................................................... 2301

138. Cooperative Agreements with NATO Allies and Other 

Countries ...................................................................... 2341

139. Research and Development ............................................ 2351

140. Procurement of Commercial Items ................................ 2375

141. Miscellaneous Procurement Provisions ......................... 2381

142. Procurement Technical Assistance Cooperative Agreement Program .............................................................. 2411

143. Production by Military Agencies .................................... 2421

144. Major Defense Acquisition Programs ............................ 2430

144A. Major Automated Information System Programs ........ 2445a 

145. Cataloging and Standardization .................................... 2451

146. Contracting for Performance of Civilian Commercial 

or Industrial Type Functions ..................................... 2460

147. Commissaries and Exchanges and Other Morale, Welfare, and Recreation Activities ................................... 2481

148. National Defense Technology and Industrial Base, 

Defense Reinvestment, and Defense Conversion ...... 2500

149. Defense Acquisition System ........................................... 2545

[150. Repealed.] 

152. Issue of Supplies, Services, and Facilities .................... 2551

153. Exchange of Material and Disposal of Obsolete, Surplus, or Unclaimed Property ...................................... 2571

155. Acceptance of Gifts and Services ................................... 2601

157. Transportation ................................................................ 2631

159. Real Property; Related Personal Property; and Lease 

of Non-Excess Property ............................................... 2661

160. Environmental Restoration ............................................ 2700

161. Property Records and Report of Theft or Loss of Certain Property ................................................................ 2721

163. Military Claims ............................................................... 2731

165. Accountability and Responsibility ................................. 2771

[167. Repealed.] 

169. Military Construction and Military Family Housing ... 2801

[171. Repealed.] 

172. Strategic Environmental Research and Development 

Program ........................................................................ 2901

173. Energy Security ............................................................... 2911

[NOTE: Subtitles B–E are set out in Volume III of this 

publication] 
vii 

TABLE OF SECTIONS OF TITLE 10 

SUBTITLE A—GENERAL MILITARY LAW 

[NOTE: Parts I and II are set out in Volume I of this 

publication] 

PART III—TRAINING AND EDUCATION 

CHAPTER 101—TRAINING GENERALLY 

Sec. 

[2001. Repealed.] 

2002. Dependents of members of armed forces: language training. 

2003. Aeronautical rating as pilot: qualifications. 

2004. Detail of commissioned officers as students at law schools. 

2004a. Detail of commissioned officers as students at medical schools. 

2004b. Detail of commissioned officers as students at schools of psychology. 

2005. Advanced education assistance: active duty agreement; reimbursement 

requirements. 

2006. Department of Defense Education Benefits Fund. 

2007. Payment of tuition for off-duty training or education. 

2008. Authority to use funds for certain educational purposes. 

2009. Military colleges: female students. 

2010. Participation of developing countries in combined exercises: payment of incremental expenses. 

2011. Special operations forces: training with friendly foreign forces. 

2012. Support and services for eligible organizations and activities outside Department of Defense. 

2013. Training at non-Government facilities. 

2014. Administrative actions adversely affecting military training or other readiness activities. 

2015. Payment of expenses to obtain professional credentials. 

2016. Undergraduate nurse training program: establishment through agreement 

with academic institution. 

CHAPTER 102—JUNIOR RESERVE OFFICERS’ TRAINING CORPS 

Sec. 

2031. Junior Reserve Officers’ Training Corps. 

2032. Responsibility of the Secretaries of the military departments to maximize 

enrollment and enhance efficiency. 

2033. Instructor qualifications. 

CHAPTER 103—SENIOR RESERVE OFFICERS’ TRAINING CORPS 

Sec. 

2101. Definitions. 

2102. Establishment. 

2103. Eligibility for membership. 

2103a. Students not eligible for advanced training: commitment to military service. 

2104. Advanced training; eligibility for. 

2105. Advanced training; failure to complete or to accept commission. 

2106. Advanced training; commission on completion. 

2107. Financial assistance program for specially selected members. 
TABLE OF SECTIONS OF TITLE 10 [this volume] viii 

2107a. Financial assistance program for specially selected members: Army Reserve and Army National Guard. 

2108. Advanced standing; interruption of training; delay in starting obligated 

service; release from program. 

2109. Practical military training. 

2110. Logistical support. 

2111. Personnel: administrators and instructors. 

2111a. Support for senior military colleges. 

2111b. Senior military colleges: Department of Defense international student program. 

CHAPTER 104—UNIFORMED SERVICES UNIVERSITY OF THE HEALTH 

SCIENCES 

Sec. 

2112. Establishment. 

2112a. Continued operation of University. 

2113. Administration of University. 

2113a. Board of Regents. 

2114. Students: selection; status; obligation. 

2115. Graduates: limitation on number permitted to perform civilian Federal 

service. 

2116. Military nursing research. 

[2117. Repealed.] 

CHAPTER 105—ARMED FORCES HEALTH PROFESSIONS FINANCIAL 

ASSISTANCE PROGRAMS 

Subchapter Sec. 

I. Health Professions Scholarship and Financial Assistance Program for 

Active Service .......................................................................................... 2120

II. Nurse Officer Candidate Accession Program ........................................... 2130a 

SUBCHAPTER I—HEALTH PROFESSIONS SCHOLARSHIP AND FINANCIAL ASSISTANCE

PROGRAM FOR ACTIVE SERVICE

Sec. 

2120. Definitions. 

2121. Establishment. 

2122. Eligibility for participation. 

2123. Members of the program: active duty obligation; failure to complete training; release from program. 

2124. Members of the program: numbers appointed. 

2125. Members of the program: exclusion from authorized strengths. 

2126. Members of the program: service credit. 

2127. Scholarships and financial assistance: payments. 

2128. Accession bonus for members of the program. 

SUBCHAPTER II—NURSE OFFICER CANDIDATE ACCESSION PROGRAM

Sec. 

2130a. Financial assistance: nurse officer candidates. 

CHAPTER 106—EDUCATIONAL ASSISTANCE FOR MEMBERS OF THE 

SELECTED RESERVE 

Sec. 

2131. Reference to chapter 1606. 

[2132 to 2137. Renumbered.] 

2138. Savings provision. 

CHAPTER 106A—EDUCATIONAL ASSISTANCE FOR PERSONS ENLISTING 

FOR ACTIVE DUTY 

Sec. 

2141. Educational assistance program: establishment. 

2142. Educational assistance program: eligibility. 

2143. Educational assistance: amount. 

2144. Subsistence allowance. 

2145. Adjustments of amount of educational assistance and of subsistence allowance. 
ix TABLE OF SECTIONS OF TITLE 10 [this volume] 

2146. Right of member upon subsequent reenlistment to lump-sum payment in 

lieu of educational assistance. 

2147. Right of member after reenlisting to transfer entitlement to spouse or dependent children. 

2148. Duration of entitlement. 

2149. Applications for educational assistance. 

CHAPTER 107—PROFESSIONAL MILITARY EDUCATION 

Sec. 

2151. Definitions. 

2152. Joint professional military education: general requirements. 

2153. Capstone course: newly selected general and flag officers. 

2154. Joint professional military education: three-phase approach. 

2155. Joint professional military education Phase II program of instruction. 

2156. Joint Forces Staff College: duration of principal course of instruction. 

2157. Annual report to Congress. 

CHAPTER 108—DEPARTMENT OF DEFENSE SCHOOLS 

Sec. 

2161. Degree granting authority for National Defense Intelligence College. 

2162. Preparation of budget requests for operation of professional military education schools. 

2163. Degree granting authority for National Defense University. 

2164. Department of Defense domestic dependent elementary and secondary 

schools. 

2165. National Defense University: component institutions. 

2166. Western Hemisphere Institute for Security Cooperation. 

2167. National Defense University: admission of private sector civilians to professional military education program. 

2167a. Defense Cyber Investigations Training Academy: admission of private sector civilians to receive instruction. 

2168. Defense Language Institute Foreign Language Center: degree of Associate 

of Arts in foreign language. 

2169. School of Nursing: establishment. 

CHAPTER 109—EDUCATIONAL LOAN REPAYMENT PROGRAMS 

Sec. 

2171. Education loan repayment program: enlisted members on active duty in 

specified military specialties. 

[2172. Renumbered.] 

2173. Education loan repayment program: commissioned officers in specified 

health professions. 

2174. Interest payment program: members on active duty. 

CHAPTER 110—EDUCATIONAL ASSISTANCE FOR MEMBERS HELD AS 

CAPTIVES AND THEIR DEPENDENTS 

Sec. 

2181. Definitions. 

2182. Educational assistance: dependents of captives. 

2183. Educational assistance: former captives. 

2184. Termination of assistance. 

2185. Programs to be consistent with programs administered by the Department 

of Veterans Affairs. 

CHAPTER 111—SUPPORT OF SCIENCE, MATHEMATICS, AND ENGINEERING 

EDUCATION 

Sec. 

2191. Graduate fellowships. 

2192. Improvement of education in technical fields: general authority regarding 

education in science, mathematics, and engineering. 

2192a. Science, Mathematics, and Research for Transformation (SMART) Defense 

Education Program. 

2193. Improvement of education in technical fields: grants for higher education 

in science and mathematics. 

2193a. Improvement of education in technical fields: general authority for support 

of elementary and secondary education in science and mathematics. 
TABLE OF SECTIONS OF TITLE 10 [this volume] x 

2193b. Improvement of education in technical fields: program for support of elementary and secondary education in science, mathematics, and technology. 

2194. Education partnerships. 

2195. Department of Defense cooperative education programs. 

2196. Manufacturing engineering education: grant program. 

2197. Manufacturing experts in the classroom. 

2198. Management training program in Japanese language and culture. 

2199. Definitions. 

CHAPTER 112—INFORMATION SECURITY SCHOLARSHIP PROGRAM 

Sec. 

2200. Programs; purpose. 

2200a. Scholarship program. 

2200b. Grant program. 

2200c. Centers of Academic Excellence in Information Assurance Education. 

2200d. Regulations. 

2200e. Definitions. 

2200f. Inapplicability to Coast Guard. 

PART IV—SERVICE, SUPPLY, AND PROCUREMENT 

CHAPTER 131—PLANNING AND COORDINATION 

Sec. 

2201. Apportionment of funds: authority for exemption; excepted expenses. 

2202. Regulations on procurement, production, warehousing, and supply distribution functions. 

2203. Budget estimates. 

2204. Obligation of appropriations. 

2205. Reimbursements. 

2206. Disbursement of funds of military department to cover obligation of another agency of Department of Defense. 

2207. Expenditure of appropriations: limitation. 

2208. Working-capital funds. 

2209. Management funds. 

2210. Proceeds of sales of supplies: credit to appropriations. 

2211. Reimbursement for equipment, material, or services furnished members of 

the United Nations. 

2212. Obligations for contract services: reporting in budget object classes. 

2213. Limitation on acquisition of excess supplies. 

2214. Transfer of funds: procedure and limitations. 

2215. Transfer of funds to other departments and agencies: limitation. 

2216. Defense Modernization Account. 

[2216a. Repealed.] 

2217. Comparable budgeting for common procurement weapon systems. 

2218. National Defense Sealift Fund. 

[2219. Renumbered.] 

2220. Performance based management: acquisition programs. 

[2221. Repealed.] 

2222. Defense business systems: architecture, accountability, and modernization. 

2223. Information technology: additional responsibilities of Chief Information Officers. 

2223a. Information technology acquisition planning and oversight requirements. 

2224. Defense Information Assurance Program. 

2224a. Information security: continued applicability of expiring Governmentwide 

requirements to the Department of Defense. 

2225. Information technology purchases: tracking and management. 

2226. Contracted property and services: prompt payment of vouchers. 

2227. Electronic submission and processing of claims for contract payments. 

2228. Office of Corrosion Policy and Oversight. 

2229. Strategic policy on prepositioning of materiel and equipment. 

2229a. Annual report on prepositioned materiel and equipment. 

CHAPTER 133—FACILITIES FOR RESERVE COMPONENTS 

Sec. 

2231. Reference to chapter 1803. 
xi TABLE OF SECTIONS OF TITLE 10 [this volume] 

CHAPTER 134—MISCELLANEOUS ADMINISTRATIVE PROVISIONS 

Subchapter Sec. 

I. Miscellaneous Authorities, Prohibitions, and Limitations on the Use 

of Appropriated Funds ........................................................................... 2241 

II. Miscellaneous Administrative Authority .................................................. 2251 

SUBCHAPTER I—MISCELLANEOUS AUTHORITIES, PROHIBITIONS, AND LIMITATIONS ON

THE USE OF APPROPRIATED FUNDS

Sec. 

2241. Availability of appropriations for certain purposes. 

2241a. Prohibition on use of funds for publicity or propaganda purposes within 

the United States. 

2242. Authority to use appropriated funds for certain investigations and security 

services. 

2243. Authority to use appropriated funds to support student meal programs in 

overseas dependents’ schools. 

2244. Security investigations. 

2244a. Equipment scheduled for retirement or disposal: limitation on expenditures for modifications. 

2245. Use of aircraft for proficiency flying: limitation. 

2245a. Use of operation and maintenance funds for purchase of investment items: 

limitation. 

[2246 to 2248. Renumbered or Repealed.] 

2249. Prohibition on use of funds for documenting economic or employment impact of certain acquisition programs. 

2249a. Prohibition on providing financial assistance to terrorist countries. 

2249b. Display of State flag: prohibition on use of funds to arbitrarily exclude 

flag; position and manner of display. 

2249c. Regional Defense Combating Terrorism Fellowship Program: authority to 

use appropriated funds for costs associated with education and training 

of foreign officials. 

2249d. Distribution to certain foreign personnel of education and training materials and information technology to enhance military interoperability 

with the armed forces. 

SUBCHAPTER II—MISCELLANEOUS ADMINISTRATIVE AUTHORITY

Sec. 

2251. Household furnishings and other property: personnel outside the United 

States or in Alaska or Hawaii. 

2252. Rewards: missing property. 

2253. Motor vehicles. 

2254. Treatment of reports of aircraft accident investigations. 

2255. Aircraft accident investigation boards: composition requirements. 

2257. Use of recruiting materials for public relations. 

2259. Transit pass program: personnel in poor air quality areas. 

2260. Licensing of intellectual property: retention of fees. 

2261. Presentation of recognition items for recruitment and retention purposes. 

2262. Department of Defense conferences: collection of fees to cover Department 

of Defense costs. 

2263. United States contributions to the North Atlantic Treaty Organization 

common-funded budgets. 

CHAPTER 135—SPACE PROGRAMS 

Sec. 

2271. Management of space programs: joint program offices and officer management programs. 

2272. Space science and technology strategy: coordination. 

2273. Policy regarding assured access to space: national security payloads. 

2273a. Operationally Responsive Space Program Office. 

2274. Space situational awareness services and information: provision to nonUnited States Government entities. 

CHAPTER 136—PROVISIONS RELATING TO SPECIFIC PROGRAMS 

Sec. 

2281. Global Positioning System. 

2282. B–2 bomber: annual report. 
TABLE OF SECTIONS OF TITLE 10 [this volume] xii 

CHAPTER 137—PROCUREMENT GENERALLY 

Sec. 

[2301. Repealed.] 

2302. Definitions. 

2302a. Simplified acquisition threshold. 

2302b. Implementation of simplified acquisition procedures. 

2302c. Implementation of electronic commerce capability. 

2302d. Major system: definitional threshold amounts. 

2303. Applicability of chapter. 

[2303a. Repealed.] 

2304. Contracts: competition requirements. 

2304a. Task and delivery order contracts: general authority. 

2304b. Task order contracts: advisory and assistance services. 

2304c. Task and delivery order contracts: orders. 

2304d. Task and delivery order contracts: definitions. 

2304e. Contracts: prohibition on competition between Department of Defense and 

small businesses and certain other entities. 

2305. Contracts: planning, solicitation, evaluation, and award procedures. 

2305a. Design-build selection procedures. 

2306. Kinds of contracts. 

2306a. Cost or pricing data: truth in negotiations. 

2306b. Multiyear contracts: acquisition of property. 

2306c. Multiyear contracts: acquisition of services. 

2307. Contract financing. 

2308. Buy-to-budget acquisition: end items. 

2309. Allocation of appropriations. 

2310. Determinations and decisions. 

2311. Assignment and delegation of procurement functions and responsibilities. 

2312. Remission of liquidated damages. 

2313. Examination of records of contractor. 

2314. Laws inapplicable to agencies named in section 2303 of this title. 

2315. Law inapplicable to the procurement of automatic data processing equipment and services for certain defense purposes. 

2316. Disclosure of identity of contractor. 

[2317. Repealed.] 

2318. Advocates for competition. 

2319. Encouragement of new competitors. 

2320. Rights in technical data. 

2321. Validation of proprietary data restrictions. 

[2322. Repealed.] 

2323. Contract goal for small disadvantaged businesses and certain institutions 

of higher education. 

2323a. Credit for Indian contracting in meeting certain subcontracting goals for 

small disadvantaged businesses and certain institutions of higher education. 

2324. Allowable costs under defense contracts. 

2325. Restructuring costs. 

2326. Undefinitized contractual actions: restrictions. 

2327. Contracts: consideration of national security objectives. 

2328. Release of technical data under Freedom of Information Act: recovery of 

costs. 

[2329. Repealed.] 

2330. Procurement of contract services: management structure. 

2330a. Procurement of services: tracking of purchases. 

2331. Procurement of services: contracts for professional and technical services. 

2332. Share-in-savings contracts. 

2333. Joint policies on requirements definition, contingency program management, and contingency contracting. 

2334. Independent cost estimation and cost analysis. 

CHAPTER 138—COOPERATIVE AGREEMENTS WITH NATO ALLIES AND 

OTHER COUNTRIES 

Subchapter Sec. 

I. Acquisition and Cross-Servicing Agreements .......................................... 2341

II. Other Cooperative Agreements ................................................................. 2350a 
xiii TABLE OF SECTIONS OF TITLE 10 [this volume] 

SUBCHAPTER I—ACQUISITION AND CROSS-SERVICING AGREEMENTS

Sec. 

2341. Authority to acquire logistic support, supplies, and services for elements 

of the armed forces deployed outside the United States. 

2342. Cross-servicing agreements. 

2343. Waiver of applicability of certain laws. 

2344. Methods of payment for acquisitions and transfers by the United States. 

2345. Liquidation of accrued credits and liabilities. 

2346. Crediting of receipts. 

2347. Limitation on amounts that may be obligated or accrued by the United 

States. 

2348. Inventories of supplies not to be increased. 

2349. Overseas Workload Program. 

2349a. Annual report on non-NATO agreements. 

2350. Definitions. 

SUBCHAPTER II—OTHER COOPERATIVE AGREEMENTS

Sec. 

2350a. Cooperative research and development agreements: NATO organizations; 

allied and friendly foreign countries. 

2350b. Cooperative projects under Arms Export Control Act: acquisition of defense equipment. 

2350c. Cooperative military airlift agreements: allied countries. 

2350d. Cooperative logistic support agreements: NATO countries. 

2350e. NATO Airborne Warning and Control System (AWACS) program: authority of Secretary of Defense. 

2350f. Procurement of communications support and related supplies and services. 

2350g. Authority to accept use of real property, services, and supplies from foreign countries in connection with mutual defense agreements and occupational arrangements. 

2350h. Memorandums of agreement: Department of Defense ombudsman for foreign signatories. 

2350i. Foreign contributions for cooperative projects. 

2350j. Burden sharing contributions by designated countries and regional organizations. 

2350k. Relocation within host nation of elements of armed forces overseas. 

2350l. Cooperative agreements for reciprocal use of test facilities: foreign countries and international organizations. 

2350m. Participation in multinational military centers of excellence. 

CHAPTER 139—RESEARCH AND DEVELOPMENT 

Sec. 

2351. Availability of appropriations. 

2352. Defense Advanced Research Projects Agency: biennial strategic plan. 

2353. Contracts: acquisition, construction, or furnishing of test facilities and 

equipment. 

2354. Contracts: indemnification provisions. 

[2355 to 2357. Repealed.] 

2358. Research and development projects. 

2359. Science and technology programs to be conducted so as to foster the transition of science and technology to higher levels of research, development, 

test, and evaluation. 

2359a. Technology Transition Initiative. 

2359b. Defense Acquisition Challenge Program. 

2360v. Research and development laboratories: contracts for services of university 

students. 

2361. Award of grants and contracts to colleges and universities: requirement of 

competition. 

2362. Research and educational programs and activities: historically black colleges and universities and minority-serving institutions of higher education. 

[2363. Repealed.] 

2364. Coordination and communication of defense research activities. 

2365. Global Research Watch Program. 

2366. Major systems and munitions programs: survivability testing and lethality 

testing required before full-scale production. 
TABLE OF SECTIONS OF TITLE 10 [this volume] xiv 

2366a. Major defense acquisition programs: certification required before Milestone A or Key Decision Point A approval. 

2366b. Major defense acquisition programs: certification required before Milestone B or Key Decision Point B approval. 

2367. Use of federally funded research and development centers. 

[2368 to 2370a. Repealed.] 

2371. Research projects: transactions other than contracts and grants. 

2371a. Cooperative research and development agreements under StevensonWydler Technology Innovation Act of 1980. 

2372. Independent research and development and bid and proposal costs: payments to contractors. 

2373. Procurement for experimental purposes. 

2374. Merit-based award of grants for research and development. 

2374a. Prizes for advanced technology achievements. 

2374b. Prizes for achievements in promoting science, mathematics, engineering, 

or technology education. 

CHAPTER 140—PROCUREMENT OF COMMERCIAL ITEMS 

Sec. 

2375. Relationship of commercial item provisions to other provisions of law. 

2376. Definitions. 

2377. Preference for acquisition of commercial items. 

2378. Procurement of copier paper containing specified percentages of post-consumer recycled content. 

2379. Requirement for determination by Secretary of Defense and notification to 

Congress before procurement of major weapon systems as commercial 

items. 

CHAPTER 141—MISCELLANEOUS PROCUREMENT PROVISIONS 

Sec. 

2381. Contracts: regulations for bids. 

2382. Consolidation of contract requirements: policy and restrictions. 

2383. Contractor performance of acquisition functions closely associated with inherently governmental functions. 

2384. Supplies: identification of supplier and sources. 

2384a. Supplies: economic order quantities. 

2385. Arms and ammunition: immunity from taxation. 

2386. Copyrights, patents, designs, etc.; acquisition. 

2387. Procurement of table and kitchen equipment for officers’ quarters: limitation on. 

[2388. Renumbered.] 

2389. Ensuring safety regarding insensitive munitions. 

2390. Prohibition on the sale of certain defense articles from the stocks of the 

Department of Defense. 

2391. Military base reuse studies and community planning assistance. 

2392. Prohibition on use of funds to relieve economic dislocations. 

2393. Prohibition against doing business with certain offerors or contractors. 

[2394. Renumbered.] 

[2394a. Renumbered.] 

2395. Availability of appropriations for procurement of technical military equipment and supplies. 

2396. Advances for payments for compliance with foreign laws, rent in foreign 

countries, tuition, public utility services, and pay and supplies of armed 

forces of friendly foreign countries. 

[2397 to 2398a. Repealed or Renumbered.] 

2399. Operational test and evaluation of defense acquisition programs. 

2400. Low-rate initial production of new systems. 

2401. Requirement for authorization by law of certain contracts relating to vessels, aircraft, and combat vehicles. 

2401a. Lease of vehicles, equipment, vessels, and aircraft. 

2402. Prohibition of contractors limiting subcontractor sales directly to the 

United States. 

[2403 to 2407. Repealed or Renumbered.] 

2408. Prohibition on persons convicted of defense-contract related felonies and 

related criminal penalty on defense contractors. 

2409. Contractor employees: protection from reprisal for disclosure of certain information. 
xv TABLE OF SECTIONS OF TITLE 10 [this volume] 

[2409a. Repealed.] 

2410. Requests for equitable adjustment or other relief: certification. 

2410a. Contracts for periods crossing fiscal years: severable service contracts; 

leases of real or personal property. 

2410b. Contractor inventory accounting systems: standards. 

[2410c. Renumbered.] 

2410d. Subcontracting plans: credit for certain purchases. 

[2410e. Repealed.] 

2410f. Debarment of persons convicted of fraudulent use of ‘‘Made in America’’ 

labels. 

2410g. Advance notification of contract performance outside the United States. 

[2410h. Renumbered.] 

2410i. Prohibition on contracting with entities that comply with the secondary 

Arab boycott of Israel. 

2410j. Displaced contractor employees: assistance to obtain certification and employment as teachers or employment as teachers’ aides. 

2410k. Defense contractors: listing of suitable employment openings with local 

employment service office. 

2410l. Contracts for advisory and assistance services: cost comparison studies. 

2410m. Retention of amounts collected from contractor during the pendency of 

contract dispute. 

2410n. Products of Federal Prison Industries: procedural requirements. 

2410o. Multiyear procurement authority: purchase of dinitrogen tetroxide, hydrazine, and hydrazine-related products. 

2410p. Contracts: limitations on lead system integrators. 

2410q. Multiyear contracts: purchase of electricity from renewable energy 

sources. 

CHAPTER 142—PROCUREMENT TECHNICAL ASSISTANCE COOPERATIVE 

AGREEMENT PROGRAM 

Sec. 

2411. Definitions. 

2412. Purposes. 

2413. Cooperative agreements. 

2414. Limitation. 

2415. Distribution. 

2416. Subcontractor information. 

2417. Administrative costs. 

2418. Authority to provide certain types of technical assistance. 

2419. Regulations. 

CHAPTER 143—PRODUCTION BY MILITARY AGENCIES 

Sec. 

2421. Plantations and farms: operation, maintenance, and improvement. 

2422. Bakery and dairy products: procurement outside the United States. 

2423. Laundry and dry cleaning services: procurement from facilities operated by 

the Navy Resale and Services Support Office. 

2424. Procurement of supplies and services from exchange stores outside the 

United States. 

CHAPTER 144—MAJOR DEFENSE ACQUISITION PROGRAMS 

Sec. 

2430. Major defense acquisition program defined. 

2430a. Major subprograms. 

2431. Weapons development and procurement schedules. 

2432. Selected Acquisition Reports. 

2433. Unit cost reports. 

2433a. Critical cost growth in major defense acquisition programs. 

2434. Independent cost estimates; operational manpower requirements. 

2435. Baseline description. 

2436. Major defense acquisition programs: incentive program for contractors to 

purchase capital assets manufactured in United States. 

2437. Development of major defense acquisition programs: sustainment of system to be replaced. 

2438. Performance assessments and root cause analyses. 

[2439. Repealed.] 

2440. Technology and industrial base plans. 
TABLE OF SECTIONS OF TITLE 10 [this volume] xvi 

CHAPTER 144A—MAJOR AUTOMATED INFORMATION SYSTEM PROGRAMS 

Sec. 

2445a. Definitions. 

2445b. Cost, schedule, and performance information. 

2445c. Reports: quarterly reports; reports on program changes. 

2445d. Construction with other reporting requirements. 

CHAPTER 145—CATALOGING AND STANDARDIZATION 

Sec. 

2451. Defense supply management. 

2452. Duties of Secretary of Defense. 

2453. Supply catalog: distribution and use. 

2454. Supply catalog: new or obsolete items. 

[2455. Repealed.] 

2456. Coordination with General Services Administration. 

2457. Standardization of equipment with North Atlantic Treaty Organization 

members. 

2458. Inventory management policies. 

CHAPTER 146—CONTRACTING FOR PERFORMANCE OF CIVILIAN 

COMMERCIAL OR INDUSTRIAL TYPE FUNCTIONS 

Sec. 

2460. Definition of depot-level maintenance and repair. 

2461. Public-private competition required before conversion to contractor performance. 

2461a. Development and implementation of system for monitoring cost saving resulting from public-private competitions. 

2462. Reports on public-private competition. 

2463. Guidelines and procedures for use of civilian employees to perform Department of Defense functions. 

2464. Core logistics capabilities. 

2465. Prohibition on contracts for performance of firefighting or security-guard 

functions. 

2466. Limitations on the performance of depot-level maintenance of materiel. 

[2467, 2468. Repealed.] 

2469. Contracts to perform workloads previously performed by depot-level activities of the Department of Defense: requirement of competition. 

[2469a. Repealed.] 

2470. Depot-level activities of the Department of Defense: authority to compete 

for maintenance and repair workloads of other Federal agencies. 

[2471. Repealed.] 

2472. Prohibition on management of depot employees by end strength. 

[2473. Repealed.] 

2474. Centers of Industrial and Technical Excellence: designation; public-private 

partnerships. 

2475. Consolidation, restructuring, or reengineering of organizations, functions, 

or activities: notification requirements. 

2476. Minimum capital investment for certain depots. 

CHAPTER 147—COMMISSARIES AND EXCHANGES AND OTHER MORALE, 

WELFARE, AND RECREATION ACTIVITIES 

Subchapter Sec. 

I. Defense Commissary and Exchange Systems .......................................... 2481 

II. Relationship, Continuation, and Common Policies of Defense Commissary and Exchange Systems ............................................................ 2487 

III. Morale, Welfare, and Recreation Programs and Nonappropriated 

Fund Instrumentalities .......................................................................... 2491 

SUBCHAPTER I—DEFENSE COMMISSARY AND EXCHANGE SYSTEMS

Sec. 

2481. Defense commissary and exchange systems: existence and purpose. 

2482. Commissary stores: criteria for establishment or closure; store size. 

2483. Commissary stores: use of appropriated funds to cover operating expenses. 

2484. Commissary stores: merchandise that may be sold; uniform surcharges 

and pricing. 

2485. Commissary stores: operation. 
xvii TABLE OF SECTIONS OF TITLE 10 [this volume] 

SUBCHAPTER II—RELATIONSHIP, CONTINUATION, AND COMMON POLICIES OF DEFENSE

COMMISSARY AND EXCHANGE SYSTEMS

Sec. 

2487. Relationship between defense commissary system and exchange stores system. 

2488. Combined exchange and commissary stores. 

2489. Overseas commissary and exchange stores: access and purchase restrictions. 

SUBCHAPTER III—MORALE, WELFARE, AND RECREATION PROGRAMS AND

NONAPPROPRIATED FUND INSTRUMENTALITIES

Sec. 

2491. Uniform funding and management of morale, welfare, and recreation programs. 

2491a. Department of Defense golf courses: limitation on use of appropriated 

funds. 

2491b. Use of appropriated funds for operation of Armed Forces Recreation Center, Europe: limitation. 

2491c. Retention of morale, welfare, and recreation funds by military installations: limitation. 

2492. Nonappropriated fund instrumentalities: contracts with other agencies and 

instrumentalities to provide and obtain goods and services. 

2492a. Limitation on Department of Defense entities competing with private sector in offering personal information services. 

2493. Fisher Houses: administration as nonappropriated fund instrumentality. 

2494. Nonappropriated fund instrumentalities: furnishing utility services for morale, welfare, and recreation purposes. 

2495. Nonappropriated fund instrumentalities: purchase of alcoholic beverages. 

2495a. Overseas package stores: treatment of United States wines. 

2495b. Sale or rental of sexually explicit material prohibited. 

CHAPTER 148—NATIONAL DEFENSE TECHNOLOGY AND INDUSTRIAL 

BASE, DEFENSE REINVESTMENT, AND DEFENSE CONVERSION 

Subchapter Sec. 

I. Definitions ................................................................................................... 2500 

II. Policies and Planning ................................................................................. 2501 

III. Programs for Development, Application, and Support of Dual-Use 

Technologies ............................................................................................ 2511 

IV. Manufacturing Technology ........................................................................ 2521 

V. Miscellaneous Technology Base Policies and Programs .......................... 2531 

VI. Defense Export Loan Guarantees ............................................................. 2540 

VII. Critical Infrastructure Protection Loan Guarantees ............................... 2541 

SUBCHAPTER I—DEFINITIONS

Sec. 

2500. Definitions. 

SUBCHAPTER II—POLICIES AND PLANNING

Sec. 

2501. National security objectives concerning national technology and industrial 

base. 

2502. National Defense Technology and Industrial Base Council. 

2503. National defense program for analysis of the technology and industrial 

base. 

2504. Annual report to Congress. 

2505. National technology and industrial base: periodic defense capability assessments. 

2506. National technology and industrial base: periodic defense capability plan. 

2507. Data collection authority of President. 

2508. Industrial Base Fund. 

SUBCHAPTER III—PROGRAMS FOR DEVELOPMENT, APPLICATION, AND SUPPORT OF

DUAL-USE TECHNOLOGIES

Sec. 

2511. Defense dual-use critical technology program. 

[2512, 2513. Repealed.] 
TABLE OF SECTIONS OF TITLE 10 [this volume] xviii 

2514. Encouragement of technology transfer. 

2515. Office of Technology Transition. 

[2516. Repealed.] 

2517. Office for Foreign Defense Critical Technology Monitoring and Assessment. 

2518. Overseas foreign critical technology monitoring and assessment financial 

assistance program. 

2519. Federal Defense Laboratory Diversification Program. 

[2520. Repealed.] 

SUBCHAPTER IV—MANUFACTURING TECHNOLOGY

Sec. 

2521. Manufacturing Technology Program. 

2522. Armament retooling and manufacturing. 

[2523, 2524. Repealed.] 

[2525. Renumbered 2521.] 

SUBCHAPTER V—MISCELLANEOUS TECHNOLOGY BASE POLICIES AND PROGRAMS

Sec. 

2531. Defense memoranda of understanding and related agreements. 

2532. Offset policy; notification. 

2533. Determinations of public interest under chapter 83 of title 41. 

2533a. Requirement to buy certain articles from American sources; exceptions. 

2533b. Requirement to buy strategic materials critical to national security from 

American sources; exceptions. 

2534. Miscellaneous limitations on the procurement of goods other than United 

States goods. 

2535. Defense Industrial Reserve. 

2536. Award of certain contracts to entities controlled by a foreign government: 

prohibition. 

2537. Improved national defense control of technology diversions overseas. 

2538. Industrial mobilization: orders; priorities; possession of manufacturing 

plants; violations. 

2539. Industrial mobilization: plants; lists. 

2539a. Industrial mobilization: Board on Mobilization of Industries Essential for 

Military Preparedness. 

2539b. Availability of samples, drawings, information, equipment, materials, and 

certain services. 

SUBCHAPTER VI—DEFENSE EXPORT LOAN GUARANTEES

Sec. 

2540. Establishment of loan guarantee program. 

2540a. Transferability. 

2540b. Limitations. 

2540c. Fees charged and collected. 

2540d. Definitions. 

SUBCHAPTER VII—CRITICAL INFRASTRUCTURE PROTECTION LOAN GUARANTEES

Sec. 

2541. Establishment of loan guarantee program. 

2541a. Fees charged and collected. 

2541b. Administration. 

2541c. Transferability, additional limitations, and definition. 

2541d. Reports. 

CHAPTER 149—DEFENSE ACQUISITION SYSTEM 

Sec. 

2545. Definitions. 

2546. Civilian management of the defense acquisition system. 

2547. Acquisition-related functions of chiefs of the armed forces. 

2548. Performance assessments of the defense acquisition system. 

[CHAPTER 150—REPEALED] 

CHAPTER 152—ISSUE OF SUPPLIES, SERVICES, AND FACILITIES 

Sec. 

2551. Equipment and barracks: national veterans’ organizations. 
xix TABLE OF SECTIONS OF TITLE 10 [this volume] 

2552. Equipment for instruction and practice: American National Red Cross. 

2553. Equipment and services: Presidential inaugural ceremonies. 

2554. Equipment and other services: Boy Scout Jamborees. 

2555. Transportation services: international Girl Scout events. 

2556. Shelter for homeless; incidental services. 

2557. Excess nonlethal supplies: availability for humanitarian relief, domestic 

emergency assistance, and homeless veterans assistance. 

2558. National military associations: assistance at national conventions. 

2559. Provision of medical care to foreign military and diplomatic personnel: reimbursement required; waiver for provision of reciprocal services. 

2560. Aircraft and vehicles: limitation on leasing to non-Federal agencies. 

2561. Humanitarian assistance. 

2562. Limitation on use of excess construction or fire equipment from Department of Defense stocks in foreign assistance or military sales programs. 

2563. Articles and services of industrial facilities: sale to persons outside the Department of Defense. 

2564. Provision of support for certain sporting events. 

2565. Nuclear test monitoring equipment: furnishing to foreign governments. 

2566. Space and services: provision to military welfare societies. 

[2567. Repealed.] 

2568. Retention of combat uniforms by members deployed in support of contingency operations. 

CHAPTER 153—EXCHANGE OF MATERIAL AND DISPOSAL OF OBSOLETE, 

SURPLUS, OR UNCLAIMED PROPERTY 

Sec. 

2571. Interchange of supplies and services. 

2572. Documents, historical artifacts, and condemned or obsolete combat materiel: loan, gift, or exchange. 

[2573. Repealed.] 

2574. Armament: sale of individual pieces. 

2575. Disposition of unclaimed property. 

2576. Surplus military equipment: sale to State and local law enforcement, firefighting, homeland security, and emergency management agencies. 

2576a. Excess personal property: sale or donation for law enforcement activities. 

2576b. Excess personal property: sale or donation to assist firefighting agencies. 

2577. Disposal of recyclable materials. 

2578. Vessels: transfer between departments. 

2579. War booty: procedures for handling and retaining battlefield objects. 

2580. Donation of excess chapel property. 

2581. Excess UH–1 Huey and AH–1 Cobra helicopters: requirements for transfer 

to foreign countries. 

2582. Military equipment identified on United States munitions list: annual report of public sales. 

2583. Military animals: transfer and adoption. 

CHAPTER 155—ACCEPTANCE OF GIFTS AND SERVICES 

Sec. 

2601. General gift funds. 

2601a. Direct acceptance of gifts by members of the armed forces and Department 

of Defense and Coast Guard employees and their families. 

2602. American National Red Cross: cooperation and assistance. 

2603. Acceptance of fellowships, scholarships, or grants. 

2604. United Seamen’s Service: cooperation and assistance. 

2605. Acceptance of gifts for defense dependents’ schools. 

2606. Scouting: cooperation and assistance in foreign areas. 

2607. Acceptance of gifts for the Defense Intelligence College. 

2608. Acceptance of contributions for defense programs, projects, and activities; 

Defense Cooperation Account. 

[2609. Repealed.] 

2610. Competitions for excellence: acceptance of monetary awards. 

2611. Regional centers for security studies: acceptance of gifts and donations. 

2612. National Defense University: acceptance of gifts. 

2613. Acceptance of frequent traveler miles, credits, and tickets; use to facilitate 

rest and recuperation travel of deployed members and their families. 

2614. Emergency communications equipment: acceptance from local public safety 

agencies for temporary use related to disasters. 
TABLE OF SECTIONS OF TITLE 10 [this volume] xx 

CHAPTER 157—TRANSPORTATION 

Sec. 

2631. Supplies: preference to United States vessels. 

2631a. Contingency planning: sealift and related intermodal transportation requirements. 

2632. Transportation to and from certain places of employment and on military 

installations. 

2633. Stevedoring and terminal services: vessels carrying cargo or passengers 

sponsored by military department. 

2634. Motor vehicles: transportation or storage for members on change of permanent station or extended deployment. 

2635. Medical emergency helicopter transportation assistance and limitation of 

individual liability. 

2636. Deductions from amounts due carriers. 

2636a. Loss or damage to personal property transported at Government expense: 

full replacement value; deduction from amounts due carriers. 

2637. Transportation in certain areas outside the United States. 

2638. Transportation of civilian clothing of enlisted members. 

2639. Transportation to and from school for certain minor dependents. 

2640. Charter air transportation of members of the armed forces. 

2641. Transportation of certain veterans on Department of Defense aeromedical 

evacuation aircraft. 

2641a. Transportation of American Samoa veterans on Department of Defense 

aircraft for certain medical care in Hawaii. 

2641b. Space-available travel on Department of Defense aircraft: retired members 

residing in Commonwealths and possessions of the United States for 

certain health care services. 

2642. Airlift services provided to certain other agencies: use of Department of 

Defense reimbursement rate. 

2643. Commissary and exchange services: transportation overseas. 

2644. Control of transportation systems in time of war. 

2645. Indemnification of Department of Transportation for losses covered by vessel war risk insurance. 

2646. Travel services: procurement for official and unofficial travel under one 

contract. 

2647. Next-of-kin of persons unaccounted for from conflicts after World War II: 

transportation to annual meetings. 

2648. Persons and supplies: sea, land, and air transportation. 

2649. Civilian passengers and commercial cargoes: transportation on Department of Defense vessels, vehicles, and aircraft. 

2650. Civilian personnel in Alaska. 

2651. Passengers and merchandise to Guam: sea transport. 

CHAPTER 159—REAL PROPERTY; RELATED PERSONAL PROPERTY; AND 

LEASE OF NON-EXCESS PROPERTY 

Sec. 

2661. Miscellaneous administrative provisions relating to real property. 

[2661a. Repealed.] 

2662. Real property transactions: reports to congressional committees. 

2663. Land acquisition authorities. 

2664. Limitations on real property acquisition. 

2665. Sale of certain interests in land; logs. 

[2666. Repealed.] 

2667. Leases: non-excess property of military departments and Defense Agencies. 

[2667a. Repealed.] 

2668. Easements for rights-of-way. 

2668a. Easements: granting restrictive easements in connection with land conveyances. 

[2669. Repealed.] 

2670. Use of facilities by private organizations; use as polling places. 

2671. Military reservations and facilities: hunting, fishing, and trapping. 

[2672 to 2673. Repealed.] 

2674. Operation and control of Pentagon Reservation and defense facilities in 

National Capital Region. 

2675. Leases: foreign countries. 

[2676, 2677. Renumbered or Repealed.] 
xxi TABLE OF SECTIONS OF TITLE 10 [this volume] 

2678. Feral horses and burros: removal from military installations. 

[2679, 2680. Repealed.] 

2681. Use of test and evaluation installations by commercial entities. 

2682. Facilities for defense agencies. 

2683. Relinquishment of legislative jurisdiction; minimum drinking age on military installations. 

2684. Cooperative agreements for management of cultural resources. 

2684a. Agreements to limit encroachments and other constraints on military 

training, testing, and operations. 

2685. Adjustment of or surcharge on selling prices in commissary stores to provide funds for construction and improvement of commissary store facilities. 

2686. Utilities and services: sale; expansion and extension of systems and facilities. 

2687. Base closures and realignments. 

2687a. Overseas base closures and realignments and basing master plans. 

2688. Utility systems: conveyance authority. 

[2689, 2690. Renumbered.] 

2691. Restoration of land used by permit or lease. 

2692. Storage, treatment, and disposal of nondefense toxic and hazardous materials. 

[2693. Repealed.] 

2694. Conservation and cultural activities. 

2694a. Conveyance of surplus real property for natural resource conservation. 

2694b. Participation in wetland mitigation banks. 

2694c. Participation in conservation banking programs. 

2695. Acceptance of funds to cover administrative expenses relating to certain 

real property transactions. 

2696. Real property: transfer between armed forces and screening requirements 

for other Federal use. 

2697. Acceptance and use of landing fees charged for use of domestic military 

airfields by civil aircraft. 

CHAPTER 160—ENVIRONMENTAL RESTORATION 

Sec. 

2700. Definitions. 

2701. Environmental restoration program. 

2702. Research, development, and demonstration program. 

2703. Environmental restoration accounts. 

2704. Commonly found unregulated hazardous substances. 

2705. Notice of environmental restoration activities. 

2706. Annual reports to Congress. 

2707. Environmental restoration projects for environmental responses. 

2708. Contracts for handling hazardous waste from defense facilities. 

2709. Investment control process for environmental technologies. 

2710. Inventory of unexploded ordnance, discarded military munitions, and munitions constituents at defense sites (other than operational ranges). 

CHAPTER 161—PROPERTY RECORDS AND REPORT OF THEFT OR LOSS OF 

CERTAIN PROPERTY 

Sec. 

2721. Property records: maintenance on quantitative and monetary basis. 

2722. Theft or loss of ammunition, destructive devices, and explosives: report to 

Secretary of the Treasury. 

2723. Notice to congressional committees of certain security and counterintelligence failures within defense programs. 

CHAPTER 163—MILITARY CLAIMS 

Sec. 

2731. Definition. 

2732. Payment of claims: availability of appropriations. 

2733. Property loss; personal injury or death: incident to noncombat activities of 

Department of Army, Navy, or Air Force. 

2734. Property loss; personal injury or death: incident to noncombat activities of 

the armed forces; foreign countries. 

2734a. Property loss; personal injury or death: incident to noncombat activities of 

armed forces in foreign countries; international agreements. 
TABLE OF SECTIONS OF TITLE 10 [this volume] xxii 

2734b. Property loss; personal injury or death: incident to activities of armed 

forces of foreign countries in United States; international agreements. 

2735. Settlement: final and conclusive. 

2736. Property loss; personal injury or death: advance payment. 

2737. Property loss; personal injury or death: incident to use of property of the 

United States and not cognizable under other law. 

2738. Property loss: reimbursement of members for certain losses of household 

effects caused by hostile action. 

2739. Amounts recovered from third parties for loss or damage to personal property shipped or stored at Government expense: crediting to appropriations. 

2740. Property loss: reimbursement of members and civilian employees for full 

replacement value of household effects when contractor reimbursement 

not available. 

CHAPTER 165—ACCOUNTABILITY AND RESPONSIBILITY 

Sec. 

2771. Final settlement of accounts: deceased members. 

2772. Share of fines and forfeitures to benefit Armed Forces Retirement Home. 

2773. Designation, powers, and accountability of deputy disbursing officials. 

2773a. Departmental accountable officials. 

2773b. Parking of funds: prohibition; penalties. 

2774. Claims for overpayment of pay and allowances and of travel and transportation allowances. 

2775. Liability of members assigned to military housing. 

2776. Use of receipts of public money for current expenditures. 

2777. Requisitions for advances and removal of charges outstanding in accounts 

of advances. 

[2778. Repealed.] 

2779. Use of funds because of fluctuations in currency exchange rates of foreign 

countries. 

2780. Debt collection. 

2781. Availability of appropriations: exchange fees; losses in accounts. 

2782. Damage to real property: disposition of amounts recovered. 

2783. Nonappropriated fund instrumentalities: financial management and use of 

nonappropriated funds. 

2784. Management of purchase cards. 

2784a. Management of travel cards. 

2785. Remittance addresses: regulation of alterations. 

2786. Department of Defense payments by electronic transfers of funds: exercise 

of authority for waivers. 

2787. Reports of survey. 

2788. Property accountability: regulations. 

2789. Individual equipment: unauthorized disposition. 

2790. Recovery of improperly disposed of Department of Defense property. 

[CHAPTER 167—REPEALED] 

CHAPTER 169—MILITARY CONSTRUCTION AND MILITARY FAMILY 

HOUSING 

Subchapter Sec. 

I. Military Construction ................................................................................. 2801 

II. Military Family Housing ........................................................................... 2821 

III. Administration of Military Construction and Military Family Housing ............................................................................................................ 2851 

IV. Alternative Authority for Acquisition and Improvement of Military 

Housing ................................................................................................... 2871 

SUBCHAPTER I—MILITARY CONSTRUCTION

Sec. 

2801. Scope of chapter; definitions. 

2802. Military construction projects. 

2803. Emergency construction. 

2804. Contingency construction. 

2805. Unspecified minor construction. 

2806. Contributions for North Atlantic Treaty Organizations Security Investment. 
xxiii TABLE OF SECTIONS OF TITLE 10 [this volume] 

2807. Architectural and engineering services and construction design. 

2808. Construction authority in the event of a declaration of war or national 

emergency. 

2809. Long-term facilities contracts for certain activities and services. 

[2810. Repealed.] 

2811. Repair of facilities. 

2812. Lease-purchase of facilities. 

2813. Acquisition of existing facilities in lieu of authorized construction. 

2814. Special authority for development of Ford Island, Hawaii. 

2815. Joint use military construction projects: annual evaluation. 

SUBCHAPTER II—MILITARY FAMILY HOUSING

Sec. 

2821. Requirement for authorization of appropriations for construction and acquisition of military family housing. 

2822. Requirement for authorization of number of family housing units. 

[2823. Repealed.] 

2824. Authorization for acquisition of existing family housing in lieu of construction. 

2825. Improvements to family housing units. 

2826. Military family housing: local comparability of room patterns and floor 

areas. 

2827. Relocation of military family housing units. 

2828. Leasing of military family housing. 

2829. Multi-year contracts for supplies and services. 

2830. Occupancy of substandard family housing units. 

2831. Military family housing management account. 

2832. Homeowners assistance program. 

2833. Family housing support. 

2834. Participation in Department of State housing pools. 

2835. Long-term leasing of military family housing to be constructed. 

2835a. Use of military family housing constructed under build and lease authority to house other members. 

2836. Military housing rental guarantee program. 

2837. Limited partnerships with private developers of housing. 

2838. Leasing of military family housing to Secretary of Defense. 

SUBCHAPTER III—ADMINISTRATION OF MILITARY CONSTRUCTION AND MILITARY

FAMILY HOUSING

Sec. 

2851. Supervision of military construction projects. 

2852. Military construction projects: waiver of certain restrictions. 

2853. Authorized cost and scope of work variations. 

2854. Restoration or replacement of damaged or destroyed facilities. 

2854a. Conveyance of damaged or deteriorated military family housing; use of 

proceeds. 

2855. Law applicable to contracts for architectural and engineering services and 

construction design. 

2856. Military unaccompanied housing: local comparability of floor areas. 

[2857. Renumbered.] 

2858. Limitation on the use of funds for expediting a construction project. 

2859. Construction requirements related to antiterrorism and force protection or 

urban-training operations.. 

2860. Availability of appropriations. 

2861. Military construction projects in connection with industrial facility investment program. 

2862. Turn-key selection procedures. 

2863. Payment of contractor claims. 

[2864, 2865. Repealed.] 

2866. Water conservation at military installations. 

2867. Energy monitoring and utility control system specification for military construction and military family housing activities. 

2868. Utility services: furnishing for certain buildings. 

2869. Conveyance of property at military installations to limit encroachment. 
TABLE OF SECTIONS OF TITLE 10 [this volume] xxiv 

SUBCHAPTER IV—ALTERNATIVE AUTHORITY FOR ACQUISITION AND IMPROVEMENT OF

MILITARY HOUSING

Sec. 

2871. Definitions. 

2872. General authority. 

2872a. Utilities and services. 

2873. Direct loans and loan guarantees. 

2874. Leasing of housing. 

2875. Investments. 

2876. Rental guarantees. 

2877. Differential lease payments. 

2878. Conveyance or lease of existing property and facilities. 

[2879. Repealed.] 

2880. Unit size and type. 

2881. Ancillary supporting facilities. 

2881a. Pilot projects for acquisition or construction of military unaccompanied 

housing. 

2882. Effect of assignment of members to housing units acquired or constructed 

under alternative authority. 

2883. Department of Defense Housing Funds. 

2883a. Funds for housing allowances of members of the armed forces assigned to 

certain military family housing units. 

2884. Reports. 

2885. Oversight and accountability for privatization projects. 

[CHAPTER 171—REPEALED] 

CHAPTER 172—STRATEGIC ENVIRONMENTAL RESEARCH AND 

DEVELOPMENT PROGRAM 

Sec. 

2901. Strategic Environmental Research and Development Program. 

2902. Strategic Environmental Research and Development Program Council. 

2903. Executive Director. 

2904. Strategic Environmental Research and Development Program Scientific 

Advisory Board. 

CHAPTER 173—ENERGY SECURITY 

Subchapter 

I. Energy Security Activities ......................................................................... 2911 

II. Energy Related Procurement .................................................................... 2922 

III. General Provisions ..................................................................................... 2925 

SUBCHAPTER I—ENERGY SECURITY ACTIVITIES

Sec. 

2911. Energy performance goals and master plan for the Department of Defense. 

2912. Availability and use of energy cost savings. 

2913. Energy savings contracts and activities. 

2914. Energy conservation construction projects. 

2915. Facilities: use of renewable forms of energy and energy efficient products. 

2916. Sale of electricity from alternate energy and cogeneration production facilities. 

2917. Development of geothermal energy on military lands. 

2918. Fuel sources for heating systems; prohibition on converting certain heating 

facilities. 

2919. Department of Defense participation in programs for management of energy demand or reduction of energy usage during peak periods. 

SUBCHAPTER II—ENERGY-RELATED PROCUREMENT

Sec. 

2922. Liquid fuels and natural gas: contracts for storage, handling, or distribution. 

2922a. Contracts for energy or fuel for military installations. 

2922b. Procurement of energy systems using renewable forms of energy. 

2922c. Procurement of gasohol as motor vehicle fuel. 

2922d. Procurement of fuel derived from coal, oil shale, and tar sands. 
xxv TABLE OF SECTIONS OF TITLE 10 [this volume] 

2922e. Acquisition of certain fuel sources: authority to waive contract procedures; 

acquisition by exchange; sales authority. 

2922f. Preference for energy efficient electric equipment. 

2922g. Preference for motor vehicles using electric or hybrid propulsion systems. 

SUBCHAPTER III—GENERAL PROVISIONS

Sec. 

2925. Annual Department of Defense energy management reports. 

[NOTE: Subtitles B–E are set out in Volume III of this 

publication] 

957 

Subtitle A—General Military Law 

* * * * * * * 

PART III—TRAINING AND EDUCATION 

Chap. Sec. 

101. Training Generally .......................................................... 2001 

102. Junior Reserve Officers’ Training Corps ....................... 2031 

103. Senior Reserve Officers’ Training Corps ....................... 2101 

104. Uniformed Services University of the Health Sciences 2112 

105. Armed Forces Health Professions Financial Assistance Programs ............................................................. 2120 

106. Educational Assistance for Members of the Selected 

Reserve ......................................................................... 2131 

106A. Educational Assistance for Persons Enlisting for Active Duty ...................................................................... 2141 

107. Professional Military Education .................................... 2151 

108. Department of Defense Schools ..................................... 2161 

109. Educational Loan Repayment Programs ...................... 2171 

110. Educational Assistance for Members Held as Captives 

and Their Dependents ................................................. 2181 

111. Support of Science, Mathematics, and Engineering 

Education ..................................................................... 2191 

112. Information Security Scholarship Program .................. 2200 

959 

CHAPTER 101—TRAINING GENERALLY 

Sec. 

[2001. Repealed.] 

2002. Dependents of members of armed forces: language training. 

2003. Aeronautical rating as pilot: qualifications. 

2004. Detail of commissioned officers as students at law schools. 

2004a. Detail of commissioned officers as students at medical schools. 

2004b. Detail of commissioned officers as students at schools of psychology. 

2005. Advanced education assistance: active duty agreement; reimbursement 

requirements. 

2006. Department of Defense Education Benefits Fund. 

2007. Payment of tuition for off-duty training or education. 

2008. Authority to use funds for certain educational purposes. 

2009. Military colleges: female students. 

2010. Participation of developing countries in combined exercises: payment of incremental expenses. 

2011. Special operations forces: training with friendly foreign forces. 

2012. Support and services for eligible organizations and activities outside Department of Defense. 

2013. Training at non-Government facilities. 

2014. Administrative actions adversely affecting military training or other readiness activities. 

2015. Payment of expenses to obtain professional credentials. 

2016. Undergraduate nurse training program: establishment through agreement 

with academic institution. 

[§ 2001. Repealed. Pub. L. 103–337, div. A, title XVI, Sec. 

1661(a)(3)(A), Oct. 5, 1994, 108 Stat. 2980] 

§ 2002. Dependents of members of armed forces: language 

training 

(a) Notwithstanding section 701(b) of the Foreign Service Act 

of 1980 (22 U.S.C. 4021(b)) or any other provision of law, and 

under regulations to be prescribed by the Secretary of Defense or, 

with respect to the Coast Guard when it is not operating as a service in the Navy, the Secretary of Homeland Security, language 

training may be provided in— 

(1) a facility of the Department of Defense; 

(2) a facility of the George P. Shultz National Foreign Affairs Training Center established under section 701(a) of the 

Foreign Service Act of 1980 (22 U.S.C. 4021(a)); or 

(3) a civilian educational institution; 

to a dependent of a member of the armed forces in anticipation of 

the member’s assignment to permanent duty outside the United 

States. 

(b) In this section, the term ‘‘dependent’’ has the same meaning 

that it has under section 401 of title 37. 

(Added Pub. L. 89–160, Sec. 1(1), Sept. 1, 1965, 79 Stat. 615; amended Pub. L. 91–278, Sec. 

2(1), (2), June 12, 1970, 84 Stat. 306; Pub. L. 96–465, title II, Sec. 2206(c)(1), Oct. 17, 1980, 

94 Stat. 2162; Pub. L. 97–22, Sec. 11(a)(7), July 10, 1981, 95 Stat. 138; Pub. L. 98–525, title 

XIV, Sec. 1405(30), Oct. 19, 1984, 98 Stat. 2624; Pub. L. 100–180, div. A, title XII, Sec. 

1231(18)(A), Dec. 4, 1987, 101 Stat. 1161; Pub. L. 107–296, title XVII, Sec. 1704(b)(1), Nov. 25, 

2002, 116 Stat. 2314; Pub. L. 108–136, div. A, title X, Sec. 1045(a)(4), Nov. 24, 2003, 117 Stat. 

1612.) 
§ 2003 CH. 101—TRAINING GENERALLY 960 

§ 2003. Aeronautical rating as pilot: qualifications 

To be eligible to receive an aeronautical rating as a pilot in the 

Army or Air Force or be designated as a naval aviator, a member 

of an armed force must successfully complete an undergraduate 

pilot course of instruction prescribed or approved by the Secretary 

of his military department. 

(Added Pub. L. 92–168, Sec. 4(1), Nov. 24, 1971, 85 Stat. 489.) 

§ 2004. Detail of commissioned officers as students at law 

schools 

(a) The Secretary of each military department may, under regulations prescribed by the Secretary of Defense, detail commissioned officers of the armed forces as students at accredited law 

schools, located in the United States, for a period of training leading to the degree of bachelor of laws or juris doctor. No more than 

twenty-five officers from each military department may commence 

such training in any single fiscal year. 

(b) To be eligible for detail under subsection (a), an officer 

must be a citizen of the United States and must— 

(1) have served on active duty for a period of not less than 

two years nor more than six years and be in the pay grade O3 or below as of the time the training is to begin; and 

(2) sign an agreement that unless sooner separated he 

will— 

(A) complete the educational course of legal training; 

(B) accept transfer or detail as a judge advocate or law 

specialist within the department concerned when his legal 

training is completed; and 

(C) agree to serve on active duty following completion 

or other termination of training for a period of two years 

for each year or part thereof of his legal training under 

subsection (a). 

(c) Officers detailed for legal training under subsection (a) shall 

be selected on a competitive basis by the Secretary of the military 

department concerned, under regulations prescribed by the Secretary of Defense. Any service obligation incurred by an officer 

under an agreement entered into under subsection (b) shall be in 

addition to any service obligation incurred by any such officer 

under any other provision of law or agreement. 

(d) Expenses incident to the detail of officers under this section 

shall be paid from any funds appropriated for the military department concerned. 

(e) An officer who, under regulations prescribed by the Secretary of Defense, is dropped from the program of legal training authorized by subsection (a) for deficiency in conduct or studies, or for 

other reasons, may be required to perform active duty in an appropriate military capacity in accordance with the active duty obligation imposed by regulations issued by the Secretary of Defense, except that in no case shall any such member be required to serve 

on active duty for any period in excess of one year for each year 

or part thereof he participated in the program. 

(f) No agreement detailing any officer of the armed forces to an 

accredited law school may be entered into during any period that 
961 § 2004a CH. 101—TRAINING GENERALLY 

the President is authorized by law to induct persons into the armed 

forces involuntarily. Nothing in this subsection shall affect any 

agreement entered into during any period when the President is 

not authorized by law to so induct persons into the armed forces. 

(Added Pub. L. 93–155, title VIII, Sec. 817(a), Nov. 16, 1973, 87 Stat. 621; amended Pub. L. 

101–510, div. A, title XIV, Sec. 1484(i)(3)(A), Nov. 5, 1990, 104 Stat. 1718.) 

§ 2004a. Detail of commissioned officers as students at medical schools 

(a) DETAIL AUTHORIZED.—The Secretary of each military department may detail commissioned officers of the armed forces as 

students at accredited medical schools or schools of osteopathy located in the United States for a period of training leading to the 

degree of doctor of medicine. No more than 25 officers from each 

military department may commence such training in any single fiscal year. 

(b) ELIGIBILITY FOR DETAIL.—To be eligible for detail under 

subsection (a), an officer must be a citizen of the United States and 

must— 

(1) have served on active duty for a period of not less than 

two years nor more than six years and be in the pay grade O3 or below as of the time the training is to begin; and 

(2) sign an agreement that unless sooner separated the officer will— 

(A) complete the educational course of medical training; 

(B) accept transfer or detail as a medical officer within 

the military department concerned when the officer’s 

training is completed; and 

(C) agree to serve, following completion of the officer’s 

training, on active duty (or on active duty and in the Selected Reserve) for a period as specified pursuant to subsection (c). 

(c) SERVICE OBLIGATION.—An agreement under subsection (b) 

shall provide that the officer shall serve on active duty for two 

years for each year or part thereof of the officer’s medical training 

under subsection (a), except that the agreement may authorize the 

officer to serve a portion of the officer’s service obligation on active 

duty and to complete the service obligation that remains upon separation from active duty in the Selected Reserve, in which case the 

officer shall serve three years in the Selected Reserve for each year 

or part thereof of the officer’s medical training under subsection (a) 

for any service obligation that was not completed before separation 

from active duty. 

(d) SELECTION OF OFFICERS FOR DETAIL.—Officers detailed for 

medical training under subsection (a) shall be selected on a competitive basis by the Secretary of the military department concerned. 

(e) APPOINTMENT AND TREATMENT OF PRIOR ACTIVE SERVICE.— 

(1) A commissioned officer detailed as a student at a medical school 

under subsection (a) shall be appointed as a regular officer in the 

grade of second lieutenant or ensign and shall serve on active duty 

in that grade with full pay and allowances of that grade. 
§ 2004b CH. 101—TRAINING GENERALLY 962 

(2) If an officer detailed to be a medical student has prior active service in a pay grade and with years of service credited for 

pay that would entitle the officer, if the officer remained in the 

former grade, to a rate of basic pay in excess of the rate of basic 

pay for regular officers in the grade of second lieutenant or ensign, 

the officer shall be paid basic pay based on the former grade and 

years of service credited for pay. The amount of such basic pay for 

the officer shall be increased on January 1 of each year by the percentage by which basic pay is increased on average on that date 

for that year, and the officer shall continue to receive basic pay 

based on the former grade and years of service until the date, 

whether occurring before or after graduation, on which the basic 

pay for the officer in the officer’s actual grade and years of service 

credited for pay exceeds the amount of basic pay to which the officer is entitled based on the officer’s former grade and years of service. 

(f) RELATION OF SERVICE OBLIGATIONS TO OTHER SERVICE OBLIGATIONS.—Any service obligation incurred by an officer under an 

agreement entered into under subsection (b) shall be in addition to 

any service obligation incurred by the officer under any other provision of law or agreement. 

(g) EXPENSES.—Expenses incident to the detail of officers 

under this section shall be paid from any funds appropriated for 

the military department concerned. 

(h) FAILURE TO COMPLETE PROGRAM.—(1) An officer who is 

dropped from a program of medical training to which detailed 

under subsection (a) for deficiency in conduct or studies, or for 

other reasons, may be required to perform active duty in an appropriate military capacity in accordance with the active duty obligation imposed on the officer under regulations issued by the Secretary of Defense for purposes of this section. 

(2) In no case shall an officer be required to serve on active 

duty under paragraph (1) for any period in excess of one year for 

each year or part thereof the officer participated in the program. 

(i) LIMITATION ON DETAILS.—No agreement detailing an officer 

of the armed forces to an accredited medical school or school of osteopathy may be entered into during any period in which the President is authorized by law to induct persons into the armed forces 

involuntarily. Nothing in this subsection shall affect any agreement 

entered into during any period when the President is not authorized by law to so induct persons into the armed forces. 

(Added Pub. L. 109–364, div. A, title V, Sec. 536(a), Oct. 17, 2006, 120 Stat. 2207; amended Pub. 

L. 110–181, div. A, title V, Sec. 524(c), Jan. 28, 2008, 122 Stat. 104; Pub. L. 111–84, div. A, 

title X, Sec. 1073(a)(18), Oct. 28, 2009, 123 Stat. 2473.) 

§ 2004b. Detail of commissioned officers as students at 

schools of psychology 

(a) DETAIL AUTHORIZED.—The Secretary of each military department may detail commissioned officers of the armed forces as 

students at accredited schools of psychology located in the United 

States for a period of training leading to the degree of Doctor of 

Philosophy in clinical psychology. No more than 25 officers from 

each military department may commence such training in any single fiscal year. 
963 § 2004b CH. 101—TRAINING GENERALLY 

(b) ELIGIBILITY FOR DETAIL.—To be eligible for detail under 

subsection (a), an officer must be a citizen of the United States and 

must— 

(1) have served on active duty for a period of not less than 

two years nor more than six years and be in the pay grade O– 

3 or below as of the time the training is to begin; and 

(2) sign an agreement that unless sooner separated the officer will— 

(A) complete the educational course of psychological 

training; 

(B) accept transfer or detail as a commissioned officer 

within the military department concerned when the officer’s training is completed; and 

(C) agree to serve, following completion of the officer’s 

training, on active duty (or on active duty and in the Selected Reserve) for a period as specified pursuant to subsection (c). 

(c) SERVICE OBLIGATION.—(1) Except as provided in paragraph 

(2), the agreement of an officer under subsection (b) shall provide 

that the officer shall serve on active duty for two years for each 

year or part thereof of the officer’s training under subsection (a). 

(2) The agreement of an officer may authorize the officer to 

serve a portion of the officer’s service obligation on active duty and 

to complete the service obligation that remains upon separation 

from active duty in the Selected Reserve. Under any such agreement, an officer shall serve three years in the Selected Reserve for 

each year or part thereof of the officer’s training under subsection 

(a) for any service obligation that was not completed before separation from active duty. 

(d) SELECTION OF OFFICERS FOR DETAIL.—Officers detailed for 

training under subsection (a) shall be selected on a competitive 

basis by the Secretary of the military department concerned. 

(e) RELATION OF SERVICE OBLIGATIONS TO OTHER SERVICE OBLIGATIONS.—Any service obligation incurred by an officer under an 

agreement entered into under subsection (b) shall be in addition to 

any service obligation incurred by the officer under any other provision of law or agreement. 

(f) EXPENSES.—Expenses incident to the detail of officers under 

this section shall be paid from any funds appropriated for the military department concerned. 

(g) FAILURE TO COMPLETE PROGRAM.—(1) An officer who is 

dropped from a program of psychological training to which detailed 

under subsection (a) for deficiency in conduct or studies, or for 

other reasons, may be required to perform active duty in an appropriate military capacity in accordance with the active duty obligation imposed on the officer under regulations issued by the Secretary of Defense for purposes of this section. 

(2) In no case shall an officer be required to serve on active 

duty under paragraph (1) for any period in excess of one year for 

each year or part thereof the officer participated in the program. 

(h) LIMITATION ON DETAILS.—No agreement detailing an officer 

of the armed forces to an accredited school of psychology may be 

entered into during any period in which the President is authorized 

by law to induct persons into the armed forces involuntarily. Noth-
§ 2005 CH. 101—TRAINING GENERALLY 964 

ing in this subsection shall affect any agreement entered into during any period when the President is not authorized by law to so 

induct persons into the armed forces. 

(Added Pub. L. 111–84, div. A, title V, Sec. 521(a), Oct. 28, 2009, 123 Stat. 2283; amended Pub. 

L. 111–383, div. A, title X, Sec. 1075(b)(26), Jan. 7, 2011, 124 Stat. 4370.) 

§ 2005. Advanced education assistance: active duty agreement; reimbursement requirements 

(a) The Secretary concerned may require, as a condition to the 

Secretary providing advanced education assistance to any person, 

that such person enter into a written agreement with the Secretary 

concerned under the terms of which such person shall agree— 

(1) to complete the educational requirements specified in 

the agreement and to serve on active duty for a period specified in the agreement; 

(2) that if such person fails to complete the education requirements specified in the agreement, such person will serve 

on active duty for a period specified in the agreement; 

(3) that if such person does not complete the period of active duty specified in the agreement, or does not fulfill any 

term or condition prescribed pursuant to paragraph (4), such 

person shall be subject to the repayment provisions of section 

303a(e) of title 37; and 

(4) to such other terms and conditions as the Secretary 

concerned may prescribe to protect the interest of the United 

States. 

(b) The Secretary concerned shall determine the period of active duty to be served by any person for advanced education assistance to be provided such person by an armed force, except that if 

the period of active duty required to be served is specified under 

another provision of law with respect to the advanced education assistance to be provided, the period specified in the agreement referred to in subsection (a) shall be the same as the period specified 

in such other provision of law. 

(c) As a condition of the Secretary concerned providing financial assistance under section 2107 or 2107a of this title to any person, the Secretary concerned shall require that the person enter 

into the agreement described in subsection (a). In addition to the 

requirements of paragraphs (1) through (4) of such subsection, the 

agreement shall specify that, if the person does not complete the 

education requirements specified in the agreement or does not fulfill any term or condition prescribed pursuant to paragraph (4) of 

such subsection, the person shall be subject to the repayment provisions of section 303a(e) of title 37 without the Secretary first ordering such person to active duty as provided for under subsection 

(a)(2) and sections 2107(f) and 2107a(f) of this title. 

(d) In this section: 

(1) The term ‘‘advanced education’’ means education or 

training above the secondary school level but does not include 

technical training provided to a member of the armed forces to 

qualify such member to perform a specified military function, 

to workshops, or to short-term training programs. 

(2) The term ‘‘assistance’’ means the direct provision of any 

course of advanced education by the Secretary concerned, reim-
965 § 2006 CH. 101—TRAINING GENERALLY 

bursement by the Secretary concerned for any course of advanced education provided by another department or agency of 

the Federal Government, or the payment, in whole or in part, 

by the Secretary concerned for any course of advanced education provided by any public or private educational institution 

or other entity, but such term does not include the payment for 

any course of advanced education which is paid for under chapter 106 or 107 of this title. 

(3) The term ‘‘cost of advanced education’’ means those 

costs which are, under regulations prescribed by the Secretary 

concerned, directly attributable to the education of the person 

to whom a course of advanced education is provided, including 

the cost of tuition and other fees (or, if none is charged, an 

amount determined by the Secretary concerned to be a reasonable charge for the education provided), the cost of books, supplies, transportation, and miscellaneous expenses, and the cost 

of room and board, but such term does not include pay or allowances under title 37 or a stipend under section 2121 of this 

title. 

(Added Pub. L. 96–357, Sec. 2(a), Sept. 24, 1980, 94 Stat. 1180; amended Pub. L. 98–94, title 

X, Sec. 1003(b)(1), title XII, Sec. 1268(10), Sept. 24, 1983, 97 Stat. 656, 706; Pub. L. 100–180, 

div. A, title XII, Sec. 1231(17), Dec. 4, 1987, 101 Stat. 1161; Pub. L. 101–510, div. A, title V, 

Sec. 534, Nov. 5, 1990, 104 Stat. 1564; Pub. L. 103–160, div. A, title V, Sec. 573(a), Nov. 30, 

1993, 107 Stat. 1673; Pub. L. 109–163, div. A, title VI, Sec. 687(c)(2), Jan. 6, 2006, 119 Stat. 

3333.) 

§ 2006. Department of Defense Education Benefits Fund 

(a) There is established on the books of the Treasury a fund 

to be known as the Department of Defense Education Benefits 

Fund (hereinafter in this section referred to as the ‘‘Fund’’), which 

shall be administered by the Secretary of the Treasury. The Fund 

shall be used for the accumulation of funds in order to finance 

armed forces education liabilities on an actuarially sound basis. 

(b) In this section: 

(1) The term ‘‘armed forces education liabilities’’ means liabilities of the armed forces for benefits under chapter 30 or 

33 of title 38 and for Department of Defense benefits under 

paragraphs (3) and (4) of section 510(e) and chapters 1606 and 

1607 of this title, including funds provided by the Secretary of 

Homeland Security for education liabilities for the Coast Guard 

when it is not operating as a service in the Department of the 

Navy. 

(2) The term ‘‘normal cost’’, with respect to any period of 

time, means the total of the following: 

(A) The present value of the future benefits payable 

from the Fund for amounts attributable to increased 

amounts of educational assistance authorized under section 3015(d) of title 38 to persons who were not on active 

duty on July 1, 1985, and who during such period enter on 

active duty. 

(B) The present value of the future benefits payable 

from the Fund for amounts attributable to educational assistance authorized under subchapter III of chapter 30 of 

title 38 to persons who were not on active duty on July 1, 

1985, and who during such period— 
§ 2006 CH. 101—TRAINING GENERALLY 966 

1So in original. Two subpars. (E) have been enacted. 

(i) enter a fourth year of active duty, in the case 

of persons eligible for basic educational assistance 

under section 3011 of such title; or 

(ii) enter a period of service that will establish entitlement to such educational assistance under section 

3021(b) of such title, in the case of persons eligible for 

basic educational assistance under section 3012 of 

such title. 

(C) The present value of the future Department of Defense benefits payable from the Fund (including funds 

from the Department in which the Coast Guard is operating) for educational assistance under chapters 1606 and 

1607 of this title to persons who during such period become entitled to such assistance. 

(D) The present value of future benefits payable from 

the Fund for the Department of Defense portion of payments of educational assistance under subchapter II of 

chapter 30 of title 38 attributable to increased usage of 

benefits as a result of transfers of entitlement to basic educational assistance under section 3020 of that title during 

such period. 

(E) 1 The present value of future benefits payable from 

the Fund for educational assistance under paragraphs (3) 

and (4) of section 510(e) of this title to persons who during 

such period become entitled to such assistance. 

(E) 1 The present value of any future benefits payable 

from the Fund for amounts attributable to increased 

amounts of educational assistance authorized by section 

3316 of title 38. 

(c) There shall be deposited into the Fund the following, which 

shall constitute the assets of the Fund: 

(1) Amounts paid into the Fund by the Secretary of Defense and the Secretary of the Department in which the Coast 

Guard is operating under subsection (f). 

(2) Any amount appropriated to the Fund. 

(3) Any return on investment of the assets of the Fund. 

(d) The Secretary of the Treasury shall transfer from the Fund 

to the Secretary of Veterans Affairs such amounts as may be necessary to enable the Secretary of Veterans Affairs to make required 

payments of armed forces education liabilities. The Secretary of the 

Treasury, the Secretary of Defense, the Secretary of the Department in which the Coast Guard is operating, and the Secretary of 

Veterans Affairs shall enter into an agreement as to how and 

when, and the amounts in which, such transfers shall be made. Except for investments under subsection (h), amounts in the Fund 

may not be used for any purpose other than transfers as described 

in this subsection. 

(e)(1) The Secretary of Defense shall carry out periodic actuarial valuations of the educational programs described in subsection (b)(1). 

(2) Based on the most recent such valuation, the Secretary of 

Defense shall estimate the normal cost for the next fiscal year. 
967 § 2006 CH. 101—TRAINING GENERALLY 

(3) If at the time of any such valuation there has been a 

change in benefits under an education program described in subsection (b)(1) that has been made since the last such valuation and 

that increases or decreases the present value of benefits payable 

from the Fund, the Secretary of Defense shall determine an amortization methodology and schedule for the liquidation of the unfunded liability (or negative unfunded liability) thus created such 

that the present value of the sum of the amortization payments 

equals the increase or decrease in the present value of such benefits. 

(4) If at the time of any such valuation the Secretary of Defense determines that, based upon changes in actuarial assumptions since the last valuation, there has been an actuarial gain or 

loss to the Fund, the Secretary shall determine an amortization 

methodology and schedule for the liquidation of such gain or loss 

through an increase or decrease in the payments that would otherwise be made to the Fund. 

(5) Based on the determinations under paragraphs (2), (3), and 

(4) the Secretary of Defense shall determine the amount needed to 

be appropriated to the Department of Defense and the Department 

in which the Coast Guard is operating for the next fiscal year for 

payments to be made to the Fund under subsection (f). The President shall include not less than the full amount so determined in 

the budget transmitted to Congress for the next fiscal year under 

section 1105 of title 31. The President may comment and make recommendations concerning any such amount. 

(6) All determinations under this subsection shall be made 

using methods and assumptions approved by the Board of Actuaries (including assumptions of interest rates and inflation) and in 

accordance with generally accepted actuarial principles and practices. 

(f)(1) The Secretary of Defense and the Secretary of the Department in which the Coast Guard is operating shall pay into the 

Fund each month the amount that, based upon the most recent actuarial valuation of the education programs described in subsection 

(b)(1), is equal to the actual total normal cost for the preceding 

month. 

(2) The Secretary of Defense and the Secretary of the Department in which the Coast Guard is operating shall pay into the 

Fund at the beginning of each fiscal year (or as soon thereafter as 

appropriations are available for such purpose) the sum of the following: 

(A) The amount of the payment for that year, if any, for 

the amortization of any liability to the Fund resulting from a 

change in benefits, as determined by the Secretary of Defense 

under subsection (e)(3). 

(B) The amount of the payment for that year, if any, for 

the amortization of any actuarial gain or loss to the Fund, as 

determined by the Secretary of Defense under subsection (e)(4). 

(3) Amounts paid into the Fund under this subsection shall be 

paid from appropriations available for the pay of members of the 

armed forces under the jurisdiction of the Secretary concerned. 

(g) The Secretary of the Treasury shall invest such portion of 

the Fund as is not in the judgment of the Secretary required to 
§ 2007 CH. 101—TRAINING GENERALLY 968 

meet current withdrawals. Such investments shall be in public debt 

securities with maturities suitable to the needs of the Fund, as determined by the Secretary, and bearing interest at rates determined by the Secretary, taking into consideration current market 

yields on outstanding marketable obligations of the United States 

of comparable maturities. The income on such investments shall be 

credited to and form a part of the Fund. 

(Added Pub. L. 98–525, title VII, Sec. 706(a)(1), Oct. 19, 1984, 98 Stat. 2568; amended Pub. L. 

100–26, Sec. 7(k)(2), Apr. 21, 1987, 101 Stat. 284; Pub. L. 101–189, div. A, title XVI, Sec. 

1621(a)(2), (6), Nov. 29, 1989, 103 Stat. 1603; Pub. L. 101–510, div. A, title XIII, Sec. 1322(a)(2), 

title XIV, Sec. 1484(j)(2), Nov. 5, 1990, 104 Stat. 1671, 1718; Pub. L. 103–337, div. A, title X, 

Sec. 1070(e)(6), Oct. 5, 1994, 108 Stat. 2859; Pub. L. 104–106, div. A, title XV, Secs. 1501(c)(21), 

1503(a)(17), Feb. 10, 1996, 110 Stat. 499, 512; Pub. L. 106–65, div. A, title V, Sec. 550, Oct. 

5, 1999, 113 Stat. 611; Pub. L. 107–107, div. A, title VI, Sec. 654(b), Dec. 28, 2001, 115 Stat. 

1157; Pub. L. 108–136, div. A, title V, Sec. 535(b), Nov. 24, 2003, 117 Stat. 1474; Pub. L. 108– 

375, div. A, title V, Sec. 527(b)(1), Oct. 28, 2004, 118 Stat. 1894; Pub. L. 109–364, div. A, title 

X, Sec. 1071(a)(9), Oct. 17, 2006, 120 Stat. 2398; Pub. L. 110–181, div. A, title IX, Sec. 906(b)(2), 

Jan. 28, 2008, 122 Stat. 277; Pub. L. 111–377, title I, Sec. 109(b)(2), Jan. 4, 2011, 124 Stat. 

4120.) 

§ 2007. Payment of tuition for off-duty training or education 

(a) Subject to subsections (b) and (c), the Secretary concerned 

may pay all or a portion of the charges of an educational institution 

for the tuition or expenses of a member of the armed forces enrolled in such educational institution for education or training during the member’s off-duty periods. 

(b)(1) In the case of a commissioned officer on active duty 

(other than a member of the Ready Reserve), the Secretary concerned may not pay charges under subsection (a) unless the officer 

agrees to remain on active duty for a period of at least two years 

after the completion of the training or education for which the 

charges are paid. 

(2) Notwithstanding paragraph (1), the Secretary concerned 

may reduce or waive the active duty service obligation— 

(A) in the case of a commissioned officer who is subject to 

mandatory separation; 

(B) in the case of a commissioned officer who has completed the period of active duty service for which the officer 

was ordered to active duty in support of a contingency operation; or 

(C) in other exigent circumstances as determined by the 

Secretary concerned. 

(c)(1) Subject to paragraphs (3) and (5), the Secretary concerned may pay the charges of an educational institution for the 

tuition or expenses described in subsection (a) of a member of the 

Selected Reserve. 

(2) Subject to paragraphs (4) and (5), the Secretary concerned 

may pay the charges of an educational institution for the tuition 

or expenses described in subsection (a) of a member of the Individual Ready Reserve who has a military occupational specialty 

designated by the Secretary concerned for purposes of this subsection. 

(3) The Secretary concerned may not pay charges under paragraph (1) for tuition or expenses of an officer of the Selected Reserve unless the officer enters into an agreement to remain a member of the Selected Reserve for at least 4 years after completion of 

the education or training for which the charges are paid. 
969 § 2009 CH. 101—TRAINING GENERALLY 

(4) The Secretary concerned may not pay charges under paragraph (2) for tuition or expenses of an officer of the Individual 

Ready Reserve unless the officer enters into an agreement to remain in the Selected Reserve or Individual Ready Reserve for at 

least 4 years after completion of the education or training for which 

the charges are paid. 

(5) The Secretary of a military department may require an enlisted member of the Selected Reserve or Individual Ready Reserve 

to enter into an agreement to serve for up to 4 years in the Selected Reserve or Individual Ready Reserve, as the case may be, 

after completion of the education or training for which tuition or 

expenses are paid under paragraph (1) or (2), as applicable. 

(d)(1) A member of the armed forces who is entitled to basic 

educational assistance under chapter 30 of title 38 may use such 

entitlement for purposes of paying any portion of the charges described in subsection (a) or (c) that are not paid for by the Secretary of the military department concerned under such subsection. 

(2) The use of entitlement under paragraph (1) shall be governed by the provisions of section 3014(b) of title 38. 

(e)(1) If an officer who enters into an agreement under subsection (b) does not complete the period of active duty specified in 

the agreement, the officer shall be subject to the repayment provisions of section 303a(e) of title 37. 

(2) If a member of the Ready Reserve who enters into an agreement under subsection (c) does not complete the period of service 

specified in the agreement, the member shall be subject to the repayment provisions of section 303a(e) of title 37. 

(f) This section shall be administered under regulations prescribed by the Secretary of Defense or, with respect to the Coast 

Guard when it is not operating as a service in the Navy, the Secretary of Homeland Security. 

(Added Pub. L. 98–525, title XIV, Sec. 1401(g)(1), Oct. 19, 1984, 98 Stat. 2618; amended Pub. 

L. 99–661, div. A, title VI, Sec. 651(a), Nov. 14, 1986, 100 Stat. 3887; Pub. L. 100–26, Sec. 3(4), 

Apr. 21, 1987, 101 Stat. 273; Pub. L. 101–510, div. A, title XIV, Sec. 1484(i)(4)(A), Nov. 5, 1990, 

104 Stat. 1718; Pub. L. 103–160, div. A, title VI, Sec. 632, Nov. 30, 1993, 107 Stat. 1684; Pub. 

L. 106–65, div. A, title VI, Sec. 675, Oct. 5, 1999, 113 Stat. 675; Pub. L. 106–398, Sec. 1 [[div. 

A], title XVI, Sec. 1602(a), (b)(1)], Oct. 30, 2000, 114 Stat. 1654, 1654A–358, 1654A–359; Pub. 

L. 108–375, div. A, title V, Sec. 553(a), (b), Oct. 28, 2004, 118 Stat. 1912; Pub. L. 109–163, div. 

A, title VI, Sec. 687(c)(3), Jan. 6, 2006, 119 Stat. 3334; Pub. L. 110–181, div. A, title V, Sec. 

521(a)–(d), Jan. 28, 2008, 122 Stat. 100–102.) 

§ 2008. Authority to use funds for certain educational purposes 

Funds appropriated to the Department of Defense may be used 

to carry out construction, as defined in section 8013(3) of the Elementary and Secondary Education Act of 1965 (20 U.S.C. 7713(3)), 

or to carry out section 8008 of such Act (20 U.S.C. 7708), relating 

to the provision of assistance to certain school facilities under the 

impact aid program. 

(Added Pub. L. 98–525, title XIV, Sec. 1401(g)(1), Oct. 19, 1984, 98 Stat. 2618; amended Pub. 

L. 104–106, div. B, title XXVIII, Sec. 2891, Feb. 10, 1996, 110 Stat. 590.) 

§ 2009. Military colleges: female students 

(a) Under regulations prescribed by the Secretary of Defense, 

any college or university designated by the Secretary of Defense as 

a military college shall, as a condition of maintaining such designa-
§ 2010 CH. 101—TRAINING GENERALLY 970 

tion, provide that qualified female undergraduate students enrolled 

in such college or university be eligible to participate in military 

training at such college or university. 

(b) Regulations prescribed under subsection (a) may not require a college or university, as a condition of maintaining its designation as a military college or for any other purpose, to require 

female undergraduate students enrolled in such college or university to participate in military training. 

(Added Pub. L. 98–525, title XIV, Sec. 1401(g)(1), Oct. 19, 1984, 98 Stat. 2619.) 

§ 2010. Participation of developing countries in combined 

exercises: payment of incremental expenses 

(a) The Secretary of Defense, after consultation with the Secretary of State, may pay the incremental expenses of a developing 

country that are incurred by that country as the direct result of 

participation in a bilateral or multilateral military exercise if— 

(1) the exercise is undertaken primarily to enhance the security interests of the United States; and 

(2) the Secretary of Defense determines that the participation by such country is necessary to the achievement of the 

fundamental objectives of the exercise and that those objectives 

cannot be achieved unless the United States provides the incremental expenses incurred by such country. 

(b) The Secretary of Defense shall submit to Congress a report 

each year, not later than March 1, containing— 

(1) a list of the developing countries for which expenses 

have been paid by the United States under this section during 

the preceding year; and 

(2) the amounts expended on behalf of each government. 

(c) The Secretary of Defense shall establish by regulation such 

accounting procedures as may be necessary to ensure that funds 

expended under this section are properly expended. 

(d) Funds available to carry out this section shall be available, 

to the extent provided in appropriations Acts, for bilateral or multilateral military exercises that begin in a fiscal year and end in the 

following fiscal year. 

(e) In this section, the term ‘‘incremental expenses’’ means the 

reasonable and proper cost of the goods and services that are consumed by a developing country as a direct result of that country’s 

participation in a bilateral or multilateral military exercise with 

the United States, including rations, fuel, training ammunition, 

and transportation. Such term does not include pay, allowances, 

and other normal costs of such country’s personnel. 

(Added Pub. L. 99–661, div. A, title XIII, Sec. 1321(a)(1), Nov. 14, 1986, 100 Stat. 3988; amended Pub. L. 105–85, div. A, title X, Sec. 1073(a)(35), Nov. 18, 1997, 111 Stat. 1902; Pub. L. 110– 

417, [div. A], title XII, Sec. 1203(a), Oct. 14, 2008, 122 Stat. 4622.) 

§ 2011. Special operations forces: training with friendly foreign forces 

(a) AUTHORITY TO PAY TRAINING EXPENSES.—Under regulations prescribed pursuant to subsection (c), the commander of the 

special operations command established pursuant to section 167 of 

this title and the commander of any other unified or specified com-
971 § 2011 CH. 101—TRAINING GENERALLY 

batant command may pay, or authorize payment for, any of the following expenses: 

(1) Expenses of training special operations forces assigned 

to that command in conjunction with training, and training 

with, armed forces and other security forces of a friendly foreign country. 

(2) Expenses of deploying such special operations forces for 

that training. 

(3) In the case of training in conjunction with a friendly 

developing country, the incremental expenses incurred by that 

country as the direct result of such training. 

(b) PURPOSE OF TRAINING.—The primary purpose of the training for which payment may be made under subsection (a) shall be 

to train the special operations forces of the combatant command. 

(c) REGULATIONS.—The Secretary of Defense shall prescribe 

regulations for the administration of this section. The regulations 

shall require that training activities may be carried out under this 

section only with the prior approval of the Secretary of Defense. 

The regulations shall establish accounting procedures to ensure 

that the expenditures pursuant to this section are appropriate. 

(d) DEFINITIONS.—In this section: 

(1) The term ‘‘special operations forces’’ includes civil affairs forces and psychological operations forces. 

(2) The term ‘‘incremental expenses’’, with respect to a developing country, means the reasonable and proper cost of rations, fuel, training ammunition, transportation, and other 

goods and services consumed by such country, except that the 

term does not include pay, allowances, and other normal costs 

of such country’s personnel. 

(e) REPORTS.—Not later than April 1 of each year, the Secretary of Defense shall submit to Congress a report regarding 

training during the preceding fiscal year for which expenses were 

paid under this section. Each report shall specify the following: 

(1) All countries in which that training was conducted. 

(2) The type of training conducted, including whether such 

training was related to counter-narcotics or counter-terrorism 

activities, the duration of that training, the number of members of the armed forces involved, and expenses paid. 

(3) The extent of participation by foreign military forces, 

including the number and service affiliation of foreign military 

personnel involved and physical and financial contribution of 

each host nation to the training effort. 

(4) The relationship of that training to other overseas 

training programs conducted by the armed forces, such as military exercise programs sponsored by the Joint Chiefs of Staff, 

military exercise programs sponsored by a combatant command, and military training activities sponsored by a military 

department (including deployments for training, short duration 

exercises, and other similar unit training events). 

(5) A summary of the expenditures under this section resulting from the training for which expenses were paid under 

this section. 
§ 2012 CH. 101—TRAINING GENERALLY 972 

(6) A discussion of the unique military training benefit to 

United States special operations forces derived from the training activities for which expenses were paid under this section. 

(Added Pub. L. 102–190, div. A, title X, Sec. 1052(a)(1), Dec. 5, 1991, 105 Stat. 1470; amended 

Pub. L. 104–106, div. A, title XV, Sec. 1503(a)(18), Feb. 10, 1996, 110 Stat. 512; Pub. L. 105– 

261, div. A, title X, Sec. 1062, Oct. 17, 1998, 112 Stat. 2129.) 

§ 2012. Support and services for eligible organizations and 

activities outside Department of Defense 

(a) AUTHORITY TO PROVIDE SERVICES AND SUPPORT.—Under 

regulations prescribed by the Secretary of Defense, the Secretary of 

a military department may in accordance with this section authorize units or individual members of the armed forces under that Secretary’s jurisdiction to provide support and services to non-Department of Defense organizations and activities specified in subsection 

(e), but only if— 

(1) such assistance is authorized by a provision of law 

(other than this section); or 

(2) the provision of such assistance is incidental to military 

training. 

(b) SCOPE OF COVERED ACTIVITIES SUBJECT TO SECTION.—This 

section does not— 

(1) apply to the provision by the Secretary concerned, 

under regulations prescribed by the Secretary of Defense, of 

customary community relations and public affairs activities 

conducted in accordance with Department of Defense policy; or 

(2) prohibit the Secretary concerned from encouraging 

members of the armed forces under the Secretary’s jurisdiction 

to provide volunteer support for community relations activities 

under regulations prescribed by the Secretary of Defense. 

(c) REQUIREMENT FOR SPECIFIC REQUEST.—Assistance under 

subsection (a) may only be provided if— 

(1) the assistance is requested by a responsible official of 

the organization to which the assistance is to be provided; and 

(2) the assistance is not reasonably available from a commercial entity or (if so available) the official submitting the request for assistance certifies that the commercial entity that 

would otherwise provide such services has agreed to the provision of such services by the armed forces. 

(d) RELATIONSHIP TO MILITARY TRAINING.—(1) Assistance 

under subsection (a) may only be provided if the following requirements are met: 

(A) The provision of such assistance— 

(i) in the case of assistance by a unit, will accomplish 

valid unit training requirements; and 

(ii) in the case of assistance by an individual member, 

will involve tasks directly related to the specific military 

occupational specialty of the member. 

(B) The provision of such assistance will not adversely affect the quality of training or otherwise interfere with the ability of a member or unit of the armed forces to perform the military functions of the member or unit. 

(C) The provision of such assistance will not result in a 

significant increase in the cost of the training. 
973 § 2012 CH. 101—TRAINING GENERALLY 

(2) Subparagraph (A)(i) of paragraph (1) does not apply in a 

case in which the assistance to be provided consists primarily of 

military manpower and the total amount of such assistance in the 

case of a particular project does not exceed 100 man-hours. 

(e) ELIGIBLE ENTITIES.—The following organizations and activities are eligible for assistance under this section: 

(1) Any Federal, regional, State, or local governmental entity. 

(2) Youth and charitable organizations specified in section 

508 of title 32. 

(3) Any other entity as may be approved by the Secretary 

of Defense on a case-by-case basis. 

(f) REGULATIONS.—The Secretary of Defense shall prescribe 

regulations governing the provision of assistance under this section. The regulations shall include the following: 

(1) Rules governing the types of assistance that may be 

provided. 

(2) Procedures governing the delivery of assistance that ensure, to the maximum extent practicable, that such assistance 

is provided in conjunction with, rather than separate from, civilian efforts. 

(3) Procedures for appropriate coordination with civilian 

officials to ensure that the assistance— 

(A) meets a valid need; and 

(B) does not duplicate other available public services. 

(4) Procedures to ensure that Department of Defense resources are not applied exclusively to the program receiving 

the assistance. 

(g) TREATMENT OF MEMBER’S PARTICIPATION IN PROVISION OF

SUPPORT OR SERVICES.—(1) The Secretary of a military department 

may not require or request a member of the armed forces to submit 

for consideration by a selection board (including a promotion board, 

command selection board, or any other kind of selection board) evidence of the member’s participation in the provision of support and 

services to non-Department of Defense organizations and activities 

under this section or the member’s involvement in, or support of, 

other community relations and public affairs activities of the armed 

forces. 

(2) Paragraph (1) does not prevent a selection board from considering material submitted voluntarily by a member of the armed 

forces which provides evidence of the participation of that member 

or another member in activities described in that paragraph. 

(h) ADVISORY COUNCILS.—(1) The Secretary of Defense shall 

encourage the establishment of advisory councils at regional, State, 

and local levels, as appropriate, in order to obtain recommendations and guidance concerning assistance under this section from 

persons who are knowledgeable about regional, State, and local 

conditions and needs. 

(2) The advisory councils should include officials from relevant 

military organizations, representatives of appropriate local, State, 

and Federal agencies, representatives of civic and social service organizations, business representatives, and labor representatives. 

(3) The Federal Advisory Committee Act (5 U.S.C. App.) shall 

not apply to such councils. 
§ 2013 CH. 101—TRAINING GENERALLY 974 

(i) CONSTRUCTION OF PROVISION.—Nothing in this section shall 

be construed as authorizing— 

(1) the use of the armed forces for civilian law enforcement 

purposes or for response to natural or manmade disasters; or 

(2) the use of Department of Defense personnel or resources for any program, project, or activity that is prohibited 

by law. 

(j) OVERSIGHT AND COST ACCOUNTING.—The Secretary of Defense shall establish a program to improve the oversight and cost 

accounting of training projects conducted in accordance with this 

section. The program shall include measures to accomplish the following: 

(1) Ensure that each project that is proposed to be conducted in accordance with this section (regardless of whether 

additional funding from the Secretary of Defense is sought) is 

requested in writing, reviewed for full compliance with this 

section, and approved in advance of initiation by the Secretary 

of the military department concerned and, in the case of a 

project that seeks additional funding from the Secretary of Defense, by the Secretary of Defense. 

(2) Ensure that each project that is conducted in accordance with this section is required to provide, within a specified 

period following completion of the project, an after-action report to the Secretary of Defense. 

(3) Require that each application for a project to be conducted in accordance with this section include an analysis and 

certification that the proposed project would not result in a significant increase in the cost of training (as determined in accordance with procedures prescribed by the Secretary of Defense). 

(4) Determine the total program cost for each project, including both those costs that are borne by the military departments from their own accounts and those costs that are borne 

by defense-wide accounts. 

(5) Provide for oversight of project execution to ensure that 

a training project under this section is carried out in accordance with the proposal for that project as approved. 

(Added Pub. L. 104–106, div. A, title V, Sec. 572(a)(1), Feb. 10, 1996, 110 Stat. 353; amended 

Pub. L. 105–85, div. A, title V, Sec. 594, Nov. 18, 1997, 111 Stat. 1764; Pub. L. 105–261, div. 

A, title V, Sec. 525(a), Oct. 17, 1998, 112 Stat. 2014.) 

§ 2013. Training at non-Government facilities 

(a) AUTHORITY TO ENTER INTO AGREEMENTS.—(1) The Secretary concerned, without regard to section 6101(b)–(d) of title 41, 

may make agreements or other arrangements for the training of 

members of the uniformed services under the jurisdiction of that 

Secretary by, in, or through non-Government facilities. 

(2) In this section, the term ‘‘non-Government facility’’ means 

any of the following: 

(A) The government of a State or of a territory or possession of the United States, including the Commonwealth of 

Puerto Rico, an interstate governmental organization, and a 

unit, subdivision, or instrumentality of any of the foregoing. 
975 § 2014 CH. 101—TRAINING GENERALLY 

(B) A foreign government or international organization, or 

instrumentality of either, which is designated by the President 

as eligible to provide training under this section. 

(C) A medical, scientific, technical, educational, research, 

or professional institution, foundation, or organization. 

(D) A business, commercial, or industrial firm, corporation, 

partnership, proprietorship, or other organization. 

(E) Individuals other than civilian or military personnel of 

the Government. 

(F) The services and property of any of the foregoing providing the training. 

(b) EXPENSES.—The Secretary concerned, from appropriations 

or other funds available to the Secretary, may— 

(1) pay all or a part of the pay of a member of a uniformed 

service who is selected and assigned for training under this 

section, for the period of training; and 

(2) pay, or reimburse the member of a uniformed service 

for, all or a part of the necessary expenses of the training 

(without regard to subsections (a) and (b) of section 3324 of 

title 31), including among those expenses the necessary costs 

of the following: 

(A) Travel and per diem instead of subsistence under 

sections 404 and 405 of title 37 and the Joint Travel Regulations for the Uniformed Services. 

(B) Transportation of immediate family, household 

goods and personal effects, packing, crating, temporarily 

storing, draying, and unpacking under sections 406 and 

409 of title 37 and the Joint Travel Regulations for the 

Uniformed Services when the estimated costs of transportation and related services are less than the estimated aggregate per diem payments for the period of training. 

(C) Tuition and matriculation fees. 

(D) Library and laboratory services. 

(E) Purchase or rental of books, materials, and supplies. 

(F) Other services or facilities directly related to the 

training of the member. 

(c) CERTAIN EXPENSES EXCLUDED.—The expenses of training do 

not include membership fees except to the extent that the fee is a 

necessary cost directly related to the training itself or that payment of the fee is a condition precedent to undergoing the training. 

(Added Pub. L. 104–201, div. A, title III, Sec. 362(a)(1), Sept. 23, 1996, 110 Stat. 2491; amended 

Pub. L. 111–350, Sec. 5(b)(2), Jan. 4, 2011, 124 Stat. 3842.) 

§ 2014. Administrative actions adversely affecting military 

training or other readiness activities 

(a) CONGRESSIONAL NOTIFICATION.—Whenever an official of an 

Executive agency takes or proposes to take an administrative action that, as determined by the Secretary of Defense in consultation with the Chairman of the Joint Chiefs of Staff, affects training 

or any other readiness activity in a manner that has or would have 

a significant adverse effect on the military readiness of any of the 

armed forces or a critical component thereof, the Secretary shall 

submit a written notification of the action and each significant ad-
§ 2014 CH. 101—TRAINING GENERALLY 976 

verse effect to the head of the Executive agency taking or proposing 

to take the administrative action. At the same time, the Secretary 

shall transmit a copy of the notification to the President, the Committee on Armed Services of the Senate, and the Committee on 

Armed Services of the House of Representatives. 

(b) NOTIFICATION TO BE PROMPT.—(1) Subject to paragraph (2), 

the Secretary shall submit a written notification of an administrative action or proposed administrative action required by subsection (a) as soon as possible after the Secretary becomes aware 

of the action or proposed action. 

(2) The Secretary shall prescribe policies and procedures to ensure that the Secretary receives information on an administrative 

action or proposed administrative action described in subsection (a) 

promptly after Department of Defense personnel receive notice of 

such an action or proposed action. 

(c) CONSULTATION BETWEEN SECRETARY AND HEAD OF EXECUTIVE AGENCY.—Upon notification with respect to an administrative 

action or proposed administrative action under subsection (a), the 

head of the Executive agency concerned shall— 

(1) respond promptly to the Secretary; and 

(2) consistent with the urgency of the training or readiness 

activity involved and the provisions of law under which the administrative action or proposed administrative action is being 

taken, seek to reach an agreement with the Secretary on immediate actions to attain the objective of the administrative action or proposed administrative action in a manner which 

eliminates or mitigates the adverse effects of the administrative action or proposed administrative action upon the training 

or readiness activity. 

(d) MORATORIUM.—(1) Subject to paragraph (2), upon notification with respect to an administrative action or proposed administrative action under subsection (a), the administrative action or 

proposed administrative action shall cease to be effective with respect to the Department of Defense until the earlier of— 

(A) the end of the five-day period beginning on the date of 

the notification; or 

(B) the date of an agreement between the head of the Executive agency concerned and the Secretary as a result of the 

consultations under subsection (c). 

(2) Paragraph (1) shall not apply with respect to an administrative action or proposed administrative action if the head of the 

Executive agency concerned determines that the delay in enforcement of the administrative action or proposed administrative action 

will pose an actual threat of an imminent and substantial 

endangerment to public health or the environment. 

(e) EFFECT OF LACK OF AGREEMENT.—(1) If the head of an Executive agency and the Secretary do not enter into an agreement 

under subsection (c)(2), the Secretary shall submit a written notification to the President who shall take final action on the matter. 

(2) Not later than 30 days after the date on which the President takes final action on a matter under paragraph (1), the President shall submit to the committees referred to in subsection (a) a 

notification of the action. 
977 § 2016 CH. 101—TRAINING GENERALLY 

(f) LIMITATION ON DELEGATION OF AUTHORITY.—The head of an 

Executive agency may not delegate any responsibility under this 

section. 

(g) DEFINITION.—In this section, the term ‘‘Executive agency’’ 

has the meaning given such term in section 105 of title 5, except 

that the term does not include the Government Accountability Office. 

(Added Pub. L. 105–85, div. A, title III, Sec. 325(a), Nov. 18, 1997, 111 Stat. 1678; amended 

Pub. L. 106–65, div. A, title X, Sec. 1067(1), Oct. 5, 1999, 113 Stat. 774; Pub. L. 108–375, div. 

A, title X, Sec. 1084(c)(3), Oct. 28, 2004, 118 Stat. 2061.) 

§ 2015. Payment of expenses to obtain professional credentials 

(a) AUTHORITY.—The Secretary of Defense and the Secretary of 

Homeland Security, with respect to the Coast Guard when it is not 

operating as a service in the Navy, may pay for— 

(1) expenses for members of the armed forces to obtain 

professional credentials, including expenses for professional accreditation, State-imposed and professional licenses, and professional certification; and 

(2) examinations to obtain such credentials. 

(b) LIMITATION.—The authority under subsection (a) may not 

be used to pay the expenses of a member to obtain professional credentials that are a prerequisite for appointment in the armed 

forces. 

(Added Pub. L. 109–163, div. A, title V, Sec. 538(a), Jan. 6, 2006, 119 Stat. 3250.) 

§ 2016. Undergraduate nurse training program: establishment through agreement with academic institution 

(a) ESTABLISHMENT AUTHORIZED.—(1) To increase the number 

of nurses in the armed forces, the Secretary of Defense may enter 

into an agreement with one or more academic institutions to establish and operate an undergraduate program (in this section referred to as a ‘‘undergraduate nurse training program’’) under 

which participants will earn a bachelor of science degree in nursing 

and serve as a member of the armed forces. 

(2) The Secretary of Defense may authorize the participation of 

members of the other uniformed services in the undergraduate 

nurse training program if the Secretary of Defense and the Secretary of Health and Human Services jointly determine the participation of such members in the program will facilitate an increase 

in the number of nurses in the other uniformed services. 

(b) GRADUATION RATES.—An undergraduate nurse training 

program shall have the capacity to graduate 25 students with a 

bachelor of science degree in nursing in the first class of the program, 50 in the second class, and 100 annually thereafter. 

(c) ELEMENTS.—An undergraduate nurse training program 

shall have the following elements: 

(1) It shall involve an academic partnership with one or 

more academic institutions with existing accredited schools of 

nursing. 

(2) It shall recruit as participants qualified individuals 

with at least two years of appropriate academic preparation, as 

determined by the Secretary of Defense. 
§ 2016 CH. 101—TRAINING GENERALLY 978 

(d) LOCATION OF PROGRAMS.—(1) An academic institution selected to operate an undergraduate nurse training program shall 

establish the program at or near a military installation that has a 

military treatment facility designated as a medical center with inpatient capability and multiple graduate medical education programs located on the installation or within reasonable proximity to 

the installation. 

(2) Before approving a location as the site of an undergraduate 

nurse training program, the Secretary of Defense shall conduct an 

assessment to ensure that the establishment of the program at that 

location will not adversely impact or displace existing nurse training programs, either conducted by the Department of Defense or by 

a civilian entity, at the location. 

(e) LIMITATION ON FACULTY.—An agreement entered into under 

subsection (a) shall not require members of the armed forces who 

are nurses to serve as faculty members for an undergraduate nurse 

training program. 

(f) MILITARY SERVICE COMMITMENT.—The Secretary of Defense 

shall encourage members of the armed forces to apply to participate in an undergraduate nurse training program. Graduates of 

the program shall incur a military service obligation in a regular 

or reserve component, as determined by the Secretary. 

(Added Pub. L. 111–84, div. A, title V, Sec. 525(b)(1), Oct. 28, 2009, 123 Stat. 2286; amended 

Pub. L. 111–383, div. A, title V, Sec. 551(a)–(c), Jan. 7, 2011, 124 Stat. 4219.) 
979 

CHAPTER 102—JUNIOR RESERVE OFFICERS’ TRAINING 

CORPS 

Sec. 

2031. Junior Reserve Officers’ Training Corps. 

2032. Responsibility of the Secretaries of the military departments to maximize 

enrollment and enhance efficiency. 

2033. Instructor qualifications. 

§ 2031. Junior Reserve Officers’ Training Corps 

(a)(1) The Secretary of each military department shall establish and maintain a Junior Reserve Officers’ Training Corps, organized into units, at public and private secondary educational institutions which apply for a unit and meet the standards and criteria 

prescribed pursuant to this section. The President shall promulgate 

regulations prescribing the standards and criteria to be followed by 

the military departments in selecting the institutions at which 

units are to be established and maintained and shall provide for 

the fair and equitable distribution of such units throughout the Nation, except that more than one such unit may be established and 

maintained at any military institute. 

(2) It is a purpose of the Junior Reserve Officers’ Training 

Corps to instill in students in United States secondary educational 

institutions the values of citizenship, service to the United States, 

and personal responsibility and a sense of accomplishment. 

(b) No unit may be established or maintained at an institution 

unless— 

(1) the number of physically fit students in such unit who 

are in a grade above the 8th grade and are citizens or nationals of the United States, or aliens lawfully admitted to the 

United States for permanent residence, is not less than (A) 10 

percent of the number of students enrolled in the institution 

who are in a grade above the 8th grade, or (B) 100, whichever 

is less; 

(2) the institution has adequate facilities for classroom instruction, storage of arms and other equipment which may be 

furnished in support of the unit, and adequate drill areas at 

or in the immediate vicinity of the institution, as determined 

by the Secretary of the military department concerned; 

(3) the institution provides a course of military instruction 

of not less than three academic years’ duration, as prescribed 

by the Secretary of the military department concerned; 

(4) the institution agrees to limit membership in the unit 

to students who maintain acceptable standards of academic 

achievement and conduct, as prescribed by the Secretary of the 

military department concerned; and 

(5) the unit meets such other requirements as may be established by the Secretary of the military department concerned. 
§ 2031 CH. 102—JUNIOR ROTC 980 

(c) The Secretary of the military department concerned shall, 

to support the Junior Reserve Officers’ Training Corps program— 

(1) detail officers and noncommissioned officers of an 

armed force under his jurisdiction to institutions having units 

of the Corps as administrators and instructors; 

(2) provide necessary text materials, equipment, and uniforms and, to the extent considered appropriate by the Secretary concerned, such additional resources (including transportation and billeting) as may be available to support activities of the program; and 

(3) establish minimum acceptable standards for performance and achievement for qualified units. 

(d) Instead of, or in addition to, detailing officers and noncommissioned officers on active duty under subsection (c)(1), the 

Secretary of the military department concerned may authorize 

qualified institutions to employ, as administrators and instructors 

in the program, retired officers and noncommissioned officers who 

are in receipt of retired pay, and members of the Fleet Reserve and 

Fleet Marine Corps Reserve, whose qualifications are approved by 

the Secretary and the institution concerned and who request such 

employment, subject to the following: 

(1) A retired member so employed is entitled to receive the 

member’s retired or retainer pay without reduction by reason 

of any additional amount paid to the member by the institution 

concerned. In the case of payment of any such additional 

amount by the institution concerned, the Secretary of the military department concerned shall pay to that institution the 

amount equal to one-half of the amount paid to the retired 

member by the institution for any period, up to a maximum of 

one-half of the difference between the member’s retired or retainer pay for that period and the active duty pay and allowances which the member would have received for that period 

if on active duty. Notwithstanding the limitation in the preceding sentence, the Secretary concerned may pay to the institution more than one-half of the additional amount paid to the 

retired member by the institution if (as determined by the Secretary) the institution is in an educationally and economically 

deprived area and the Secretary determines that such action is 

in the national interest. Payments by the Secretary concerned 

under this paragraph shall be made from funds appropriated 

for that purpose. 

(2) Notwithstanding any other provision of law, such a retired member is not, while so employed, considered to be on active duty or inactive duty training for any purpose. 

(e) Instead of, or in addition to, detailing officers and noncommissioned officers on active duty under subsection (c)(1) and 

authorizing the employment of retired officers and noncommissioned officers who are in receipt of retired pay and members of the 

Fleet Reserve and Fleet Marine Corps Reserve under subsection 

(d), the Secretary of the military department concerned may authorize qualified institutions to employ as administrators and instructors in the program officers and noncommissioned officers who 

are under 60 years of age and who, but for age, would be eligible 

for retired pay for non-regular service under section 12731 of this 
981 § 2031 CH. 102—JUNIOR ROTC 

title and whose qualifications are approved by the Secretary and 

the institution concerned and who request such employment, subject to the following: 

(1) The Secretary concerned shall pay to the institution an 

amount equal to one-half of the amount paid to the member by 

the institution for any period, up to a maximum of one-half of 

the difference between— 

(A) the retired or retainer pay for an active duty officer or noncommissioned officer of the same grade and 

years of service for such period; and 

(B) the active duty pay and allowances which the 

member would have received for that period if on active 

duty. 

(2) Notwithstanding the limitation in paragraph (1), the 

Secretary concerned may pay to the institution more than onehalf of the amount paid to the member by the institution if (as 

determined by the Secretary)— 

(A) the institution is in an educationally and economically deprived area; and 

(B) the Secretary determines that such action is in the 

national interest. 

(3) Payments by the Secretary concerned under this subsection shall be made from funds appropriated for that purpose. 

(4) Amounts may be paid under this subsection with respect to a member after the member reaches the age of 60. 

(5) Notwithstanding any other provision of law, a member 

employed by a qualified institution pursuant to an authorization under this subsection is not, while so employed, considered 

to be on active duty or inactive duty training for any purpose. 

(f)(1) When determined by the Secretary of the military department concerned to be in the national interest and agreed upon by 

the institution concerned, the institution may reimburse a Junior 

Reserve Officers’ Training Corps instructor for moving expenses incurred by the instructor to accept employment at the institution in 

a position that the Secretary concerned determines is hard-to-fill 

for geographic or economic reasons. 

(2) As a condition on providing reimbursement under paragraph (1), the institution shall require the instructor to execute a 

written agreement to serve a minimum of two years of employment 

at the institution in the hard-to-fill position. 

(3) Any reimbursement provided to an instructor under paragraph (1) is in addition to the minimum instructor pay otherwise 

payable to the instructor. 

(4) The Secretary concerned shall reimburse an institution providing reimbursement to an instructor under paragraph (1) in an 

amount equal to the amount of the reimbursement paid by the institution under that paragraph. Any reimbursement provided by 

the Secretary concerned shall be provided from funds appropriated 

for that purpose. 

(5) The provision of reimbursement under paragraph (1) or (4) 

shall be subject to regulations prescribed by the Secretary of Defense for purposes of this subsection. 
§ 2032 CH. 102—JUNIOR ROTC 982 

(Added Pub. L. 88–647, title I, Sec. 101(1), Oct. 13, 1964, 78 Stat. 1063; amended Pub. L. 89– 

718, Sec. 16, Nov. 2, 1966, 80 Stat. 1117; Pub. L. 90–83, Sec. 3(4), Sept. 11, 1967, 81 Stat. 220; 

Pub. L. 93–165, Nov. 29, 1973, 87 Stat. 660; Pub. L. 94–361, title VIII, Sec. 807, July 14, 1976, 

90 Stat. 933; Pub. L. 95–358, Sept. 8, 1978, 92 Stat. 592; Pub. L. 98–525, title IV, Sec. 422, 

title XIV, Sec. 1405(32), Oct. 19, 1984, 98 Stat. 2520, 2624; Pub. L. 100–26, Sec. 7(i)(3), Apr. 

21, 1987, 101 Stat. 282; Pub. L. 102–484, div. A, title V, Sec. 533(a)–(e)(1), Oct. 23, 1992, 106 

Stat. 2411, 2412; Pub. L. 103–160, div. A, title XI, Sec. 1182(g)(1), Nov. 30, 1993, 107 Stat. 1774; 

Pub. L. 107–107, div. A, title V, Sec. 537, Dec. 28, 2001, 115 Stat. 1107; Pub. L. 109–364, div. 

A, title V, Sec. 540, Oct. 17, 2006, 120 Stat. 2211; Pub. L. 110–181, div. A, title VI, Sec. 635, 

Jan. 28, 2008, 122 Stat. 155.) 

§ 2032. Responsibility of the Secretaries of the military departments to maximize enrollment and enhance efficiency 

(a) COORDINATION.—The Secretary of each military department, in establishing, maintaining, transferring, and terminating 

Junior Reserve Officers’ Training Corps units under section 2031 

of this title, shall do so in a coordinated manner that is designed 

to maximize enrollment in the Corps and to enhance administrative efficiency in the management of the Corps. 

(b) CONSIDERATION OF NEW SCHOOL OPENINGS AND CONSOLI- DATIONS.—In carrying out subsection (a), the Secretary of a military department shall take into consideration— 

(1) openings of new schools; 

(2) consolidations of schools; and 

(3) the desirability of continuing the opportunity for participation in the Corps by participants whose continued participation would otherwise be adversely affected by new school 

openings and consolidations of schools. 

(Added Pub. L. 105–85, div. A, title V, Sec. 546(a), Nov. 18, 1997, 111 Stat. 1746.) 

§ 2033. Instructor qualifications 

(a) IN GENERAL.—In order for a retired officer or noncommissioned officer to be employed as an instructor in the program, the 

officer must be certified by the Secretary of the military department concerned as a qualified instructor in leadership, wellness 

and fitness, civics, and other courses related to the content of the 

program, according to the qualifications set forth in subsection 

(b)(2) or (c)(2), as appropriate. 

(b) SENIOR MILITARY INSTRUCTORS.— 

(1) ROLE.—Senior military instructors shall be retired officers of the armed forces and shall serve as instructional leaders who oversee the program. 

(2) QUALIFICATIONS.—A senior military instructor shall 

have the following qualifications: 

(A) Professional military qualification, as determined 

by the Secretary of the military department concerned. 

(B) Award of a baccalaureate degree from an institution of higher learning. 

(C) Completion of secondary education teaching certification requirements for the program as established by the 

Secretary of the military department concerned. 

(D) Award of an advanced certification by the Secretary of the military department concerned in core content areas based on— 

(i) accumulated points for professional activities, 

services to the profession, awards, and recognitions; 
983 § 2033 CH. 102—JUNIOR ROTC 

(ii) professional development to meet content 

knowledge and instructional skills; and 

(iii) performance evaluation of competencies and 

standards within the program through site visits and 

inspections. 

(c) NON-SENIOR MILITARY INSTRUCTORS.— 

(1) ROLE.—Non-senior military instructors shall be retired 

noncommissioned officers of the armed forces and shall serve 

as instructional leaders and teach independently of, but share 

program responsibilities with, senior military instructors. 

(2) QUALIFICATIONS.—A non-senior military instructor 

shall demonstrate a depth of experience, proficiency, and expertise in coaching, mentoring, and practical arts in executing 

the program, and shall have the following qualifications: 

(A) Professional military qualification, as determined 

by the Secretary of the military department concerned. 

(B) Award of an associates degree from an institution 

of higher learning within five years of employment. 

(C) Completion of secondary education teaching certification requirements for the program as established by the 

Secretary of the military department concerned. 

(D) Award of an advanced certification by the Secretary of the military department concerned in core content areas based on— 

(i) accumulated points for professional activities, 

services to the profession, awards, and recognitions; 

(ii) professional development to meet content 

knowledge and instructional skills; and 

(iii) performance evaluation of competencies and 

standards within the program through site visits and 

inspections. 

(Added Pub. L. 109–364, div. A, title V, Sec. 539(a), Oct. 17, 2006, 120 Stat. 2210.) 
984 

CHAPTER 103—SENIOR RESERVE OFFICERS’ TRAINING 

CORPS 

Sec. 

2101. Definitions. 

2102. Establishment. 

2103. Eligibility for membership. 

2103a. Students not eligible for advanced training: commitment to military service. 

2104. Advanced training; eligibility for. 

2105. Advanced training; failure to complete or to accept commission. 

2106. Advanced training; commission on completion. 

2107. Financial assistance program for specially selected members. 

2107a. Financial assistance program for specially selected members: Army Reserve and Army National Guard. 

2108. Advanced standing; interruption of training; delay in starting obligated 

service; release from program. 

2109. Practical military training. 

2110. Logistical support. 

2111. Personnel: administrators and instructors. 

2111a. Support for senior military colleges. 

2111b. Senior military colleges: Department of Defense international student program. 

§ 2101. Definitions 

In this chapter: 

(1) The term ‘‘program’’ means the Senior Reserve Officers’ 

Training Corps of an armed force. 

(2) The term ‘‘member of the program’’ means a student 

who is enrolled in the Senior Reserve Officers’ Training Corps 

of an armed force. 

(3) The term ‘‘advanced training’’ means the training and 

instruction offered in the Senior Reserve Officers’ Training 

Corps to students enrolled in an advanced education program 

beyond the baccalaureate degree level or to students in the 

third and fourth years of a four-year Senior Reserve Officers’ 

Training Corps course, or the equivalent period of training in 

an approved two-year Senior Reserve Officers’ Training Corps 

course (except that, in the case of a student enrolled in an academic program which has been approved by the Secretary of 

the military department concerned and which requires more 

than four academic years for completion of baccalaureate degree requirements, including elective requirements of the Senior Reserve Officers’ Training Corps course, such term includes 

a fifth academic year or a combination of a part of a fifth academic year and summer sessions). 

(Added Pub. L. 88–647, title II, Sec. 201(1), Oct. 13, 1964, 78 Stat. 1064; amended Pub. L. 98– 

94, title X, Sec. 1003(a)(1), title XII, Sec. 1268(11), Sept. 24, 1983, 97 Stat. 656, 706; Pub. L. 

100–180, div. A, title XII, Sec. 1231(17), Dec. 4, 1987, 101 Stat. 1161; Pub. L. 104–201, div. A, 

title V, Sec. 553(b), Sept. 23, 1996, 110 Stat. 2526.) 
985 § 2103 CH. 103—SENIOR ROTC 

§ 2102. Establishment 

(a) For the purpose of preparing selected students for commissioned service in the Army, Navy, Air Force, or Marine Corps, the 

Secretary of each military department, under regulations prescribed by the President, may establish and maintain a Senior Reserve Officers’ Training Corps program, organized into one or more 

units, at any accredited civilian educational institution authorized 

to grant baccalaureate degrees, and at any school essentially military that does not confer baccalaureate degrees, upon the request 

of the authorities at that institution. 

(b) No unit may be established or maintained at an institution 

unless— 

(1) the senior commissioned officer of the armed force concerned who is assigned to the program at that institution is 

given the academic rank of professor; 

(2) the institution fulfills the terms of its agreement with 

the Secretary of the military department concerned; and 

(3) the institution adopts, as a part of its curriculum, a 

four-year course of military instruction or a two-year course of 

advanced training of military instruction, or both, which the 

Secretary of the military department concerned prescribes and 

conducts. 

(c) At those institutions where a unit of the program is established membership of students in the program shall be elective or 

compulsory as provided by State law or the authorities of the institution concerned. 

(d) The President shall cause to be established and maintained 

in each State at least one unit of the program if— 

(1) a unit is requested by an educational institution in the 

State; 

(2) such request is approved by the Governor of the State 

in which the institution requesting the unit is located; and 

(3) the Secretary of the military department concerned determines that there will be not less than 40 students enrolled 

in such unit and that the provisions of this section are otherwise satisfied. 

(Added Pub. L. 88–647, title II, Sec. 201(1), Oct. 13, 1964, 78 Stat. 1065; amended Pub. L. 95– 

79, title VI, Sec. 602, July 30, 1977, 91 Stat. 332.) 

§ 2103. Eligibility for membership 

(a) To be eligible for membership in the program a person 

must be a student at an institution where a unit of the Senior Reserve Officers’ Training Corps is established. However, a student at 

an institution that does not have a unit of the Corps is eligible, if 

otherwise qualified, to be a member of a unit at another institution. 

(b) Persons from foreign countries may be enrolled as members 

of the program when their enrollment is approved by the Secretary 

of the military department concerned under criteria approved by 

the Secretary of State. 

(c) A medical, dental, pharmacy, veterinary, or sciences allied 

to medicine, student may be admitted to a unit of the program for 

a course of training consisting of 90 hours of instruction a year for 

four academic years. 
§ 2103a CH. 103—SENIOR ROTC 986 

(d) Under such conditions as the Secretary of the military department concerned may prescribe, a medical, dental, pharmacy, 

veterinary, or sciences allied to medicine, student who is a commissioned officer of a reserve component of an armed force may be admitted to and trained in a unit of the program. 

(e) An educational institution at which a unit of the program 

has been established shall give priority for enrollment in the program to students who are eligible for advanced training under section 2104 of this title. 

(Added Pub. L. 88–647, title II, Sec. 201(1), Oct. 13, 1964, 78 Stat. 1065; amended Pub. L. 104– 

201, div. A, title V, Sec. 551(a)(1), Sept. 23, 1996, 110 Stat. 2525.) 

§ 2103a. Students not eligible for advanced training: commitment to military service 

(a) AUTHORITY.—A member of the program who has completed 

successfully the first year of a four-year Senior Reserve Officers’ 

Training Corps course and who is not eligible for advanced training 

under section 2104 of this title and is not a cadet or midshipman 

appointed under section 2107 of this title may— 

(1) contract with the Secretary of the military department 

concerned, or the Secretary’s designated representative, to 

serve for the period required by the program; and 

(2) agree in writing to accept an appointment, if offered, as 

a commissioned officer in the Army, Navy, Air Force, or Marine Corps, as the case may be, and to serve in the armed 

forces for the period prescribed by the Secretary. 

(b) ELIGIBILITY REQUIREMENTS.—A member of the program 

may enter into a contract and agreement under this section (and 

receive a subsistence allowance under section 209(c) of title 37) 

only if the person— 

(1) is a citizen of the United States; 

(2) enlists in an armed force under the jurisdiction of the 

Secretary of the military department concerned for the period 

prescribed by the Secretary; and 

(3) executes a certificate of loyalty in such form as the Secretary of Defense prescribes or take a loyalty oath as prescribed by the Secretary. 

(c) PARENTAL CONSENT FOR MINORS.—A member of the program who is a minor may enter into a contract under subsection 

(a)(1) only with the consent of the member’s parent or guardian. 

(Added Pub. L. 108–136, div. A, title V, Sec. 523(b)(1), Nov. 24, 2003, 117 Stat. 1464; amended 

Pub. L. 108–375, div. A, title V, Sec. 525, Oct. 28, 2004, 118 Stat. 1889; Pub. L. 109–364, div. 

A, title X, Sec. 1071(a)(10), Oct. 17, 2006, 120 Stat. 2398.) 

§ 2104. Advanced training; eligibility for 

(a) Advanced training shall be provided to eligible members of 

the program and, if the institution concerned so requests, to eligible applicants for membership in the program. 

(b) To be eligible for continuation, or initial enrollment, in the 

program for advanced training, a person must— 

(1) be a citizen of the United States; 

(2) be selected for advanced training under procedures prescribed by the Secretary of the military department concerned; 
987 § 2105 CH. 103—SENIOR ROTC 

(3) enlist in an armed force under the jurisdiction of the 

Secretary of the military department concerned for the period 

prescribed by the Secretary; 

(4) contract, with the consent of his parent or guardian if 

he is a minor, with the Secretary of the military department 

concerned, or his designated representative, to serve for the period required by the program; 

(5) agree in writing that he will accept an appointment, if 

offered, as a commissioned officer in the Army, Navy, Air 

Force, or Marine Corps, as the case may be, and that he will 

serve in the armed forces for the period prescribed by the Secretary; 

(6) either— 

(A) complete successfully— 

(i) the first two years of a four-year Senior Reserve Officers’ Training Corps course; or 

(ii) field training or a practice cruise of a duration 

which is prescribed by the Secretary concerned as a 

preliminary requirement for admission to the advanced course; or 

(B) at the discretion of the Secretary concerned, agree 

in writing to complete field training or a practice cruise, as 

prescribed by the Secretary concerned, within two years 

after admission to the advanced course; and 

(7) execute a certificate of loyalty in such form as the Secretary of Defense prescribes or take a loyalty oath as prescribed by the Secretary. 

(c) A member of the program who is ineligible under subsection 

(b) for advanced training shall be released from the program. 

(d) This section does not apply to cadets and midshipmen appointed under section 2107, or foreign students enrolled under section 2103(b), of this title. 

(Added Pub. L. 88–647, title II, Sec. 201(1), Oct. 13, 1964, 78 Stat. 1065; amended Pub. L. 98– 

94, title X, Sec. 1003(a)(2), Sept. 24, 1983, 97 Stat. 656; Pub. L. 98–525, title V, Sec. 543(a), 

title XIV, Sec. 1401(h), Oct. 19, 1984, 98 Stat. 2530, 2619; Pub. L. 104–106, div. A, title V, Sec. 

544, Feb. 10, 1996, 110 Stat. 317; Pub. L. 107–107, div. A, title V, Sec. 535(a), Dec. 28, 2001, 

115 Stat. 1106.) 

§ 2105. Advanced training; failure to complete or to accept 

commission 

A member of the program who is selected for advanced training under section 2104 of this title, and who does not complete the 

course of instruction, or who completes the course but declines to 

accept a commission when offered, may be ordered to active duty 

by the Secretary of the military department concerned to serve in 

his enlisted grade or rating for such period of time as the Secretary 

prescribes but not for more than two years. If the member does not 

complete the period of active duty prescribed by the Secretary concerned, the member shall be subject to the repayment provisions of 

section 303a(e) of title 37. 

(Added Pub. L. 88–647, title II, Sec. 201(1), Oct. 13, 1964, 78 Stat. 1066; amended Pub. L. 109– 

163, div. A, title VI, Sec. 687(c)(4), Jan. 6, 2006, 119 Stat. 3334; Pub. L. 109–364, div. A, title 

X, Sec. 1071(a)(11), Oct. 17, 2006, 120 Stat. 2398.) 
§ 2106 CH. 103—SENIOR ROTC 988 

§ 2106. Advanced training; commission on completion 

(a) Upon satisfactorily completing the academic and military 

requirements of the program of advanced training, a member of the 

program who was selected for advanced training under section 

2104 of this title may be appointed as a regular or reserve officer 

in the appropriate armed force in the grade of second lieutenant or 

ensign, even though he is under 21 years of age. 

(b) The date of rank of officers appointed under this section in 

May or June of any year is the date of graduation of cadets or midshipmen from the United States Military Academy, the United 

States Naval Academy, or the United States Air Force Academy, as 

the case may be, in that year. The Secretary of the military department concerned shall establish the date of rank of all other officers 

appointed under this section. 

(c) In computing length of service for any purpose, an officer 

appointed under this section may not be credited with enlisted 

service for the period covered by his advanced training, other than 

any period of enlisted service performed on or after August 1, 1979, 

as a member of the Selected Reserve. 

(Added Pub. L. 88–647, title II, Sec. 201(1), Oct. 13, 1964, 78 Stat. 1066; amended Pub. L. 102– 

484, div. A, title V, Sec. 517(a)(1), Oct. 23, 1992, 106 Stat. 2407; Pub. L. 104–201, div. A, title 

V, Sec. 507(a)(1), Sept. 23, 1996, 110 Stat. 2512.) 

§ 2107. Financial assistance program for specially selected 

members 

(a) The Secretary of the military department concerned may 

appoint as a cadet or midshipman, as appropriate, in the reserve 

of an armed force under his jurisdiction any eligible member of the 

program who will be under 31 years of age on December 31 of the 

calendar year in which he is eligible under this section for appointment as an ensign in the Navy or as a second lieutenant in the 

Army, Air Force, or Marine Corps, as the case may be. 

(b) To be eligible for appointment as a cadet or midshipman 

under this section a member must— 

(1) be a citizen or national of the United States; 

(2) be specially selected for the financial assistance program under procedures prescribed by the Secretary of the military department concerned; 

(3) enlist in the reserve component of the armed force in 

which he is appointed as a cadet or midshipman for the period 

prescribed by the Secretary of the military department concerned; 

(4) contract, with the consent of his parent or guardian if 

he is a minor, with the Secretary of the military department 

concerned, or his designated representative, to serve for the period required by the program; and 

(5) agree in writing that, at the discretion of the Secretary 

of the military department concerned, he will— 

(A)(i) accept an appointment, if offered, as a commissioned officer in the Army, Navy, Air Force, or Marine 

Corps, as the case may be, and that, if he is commissioned 

as a regular officer and his regular commission is terminated before the sixth anniversary of his date of rank, he 

will accept an appointment, if offered, in the reserve com-
989 § 2107 CH. 103—SENIOR ROTC 

ponent of that armed force and not resign before that anniversary or before such other date, not beyond the eighth 

anniversary of the midshipman’s date of rank, that the 

Secretary of Defense may prescribe; and 

(ii) serve on active duty for four or more years; 

(B)(i) accept an appointment, if offered, as a commissioned officer in the Army, Navy, Air Force, or Marine 

Corps, as the case may be; and 

(ii) serve in a reserve component of that armed force 

until the eighth anniversary of the receipt of such appointment, unless otherwise extended by subsection (d) of section 2108 of this title, under such terms and conditions as 

shall be prescribed by the Secretary of the military department concerned; or 

(C)(i) accept an appointment, if offered, as a commissioned officer in the Army, Navy, Air Force, or Marine 

Corps, as the case may be; and 

(ii) serve in a reserve component of that armed force 

until at least the sixth anniversary and, at the discretion 

of the Secretary of Defense, up to the eighth anniversary 

of the receipt of such appointment, unless such appointment is otherwise extended by subsection (d) of section 

2108 of this title, under such terms and conditions as may 

be prescribed by the Secretary of the military department 

concerned. 

The performance of service under clause (5)(B) or (5)(C) may include periods of active duty, active duty for training, and other 

service in an active or inactive status in the reserve component in 

which appointed, except that performance of service under clause 

(5)(C) shall include not less than two years of active duty. 

(c)(1) The Secretary of the military department concerned may 

provide for the payment of all expenses in his department of administering the financial assistance program under this section, including tuition, fees, books, and laboratory expenses. In the case of 

a student enrolled in an academic program which has been approved by the Secretary of the military department concerned and 

which requires more than four academic years for completion of 

baccalaureate degree requirements, including elective requirements 

of the Senior Reserve Officers’ Training Corps course, financial assistance under this section may also be provided during a fifth academic year or during a combination of a part of a fifth academic 

year and summer sessions. At least 50 percent of the cadets and 

midshipmen appointed under this section must qualify for in-State 

tuition rates at their respective institutions and will receive tuition 

benefits at that rate. 

(2) The Secretary of the military department concerned may 

provide financial assistance, as described in paragraph (1), to a student enrolled in an advanced education program beyond the baccalaureate degree level if the student also is a cadet or midshipman 

in an advanced training program. Not more than 15 percent of the 

total number of scholarships awarded under this section in any 

year may be awarded under this paragraph. 

(3) In the case of a cadet or midshipman eligible to receive financial assistance under paragraph (1) or (2), the Secretary of the 
§ 2107 CH. 103—SENIOR ROTC 990 

military department concerned may, in lieu of all or part of the financial assistance described in paragraph (1), provide financial assistance in the form of room and board expenses for the cadet or 

midshipman and other expenses required by the educational institution. 

[(4) Repealed. Pub. L. 109–163, div. A, title V, Sec. 531(a)(1), 

Jan. 6, 2006, 119 Stat. 3247.] 

(5)(A) The Secretary of the Army, under regulations and criteria established by the Secretary, may provide an individual who 

received a commission as a Reserve officer in the Army from a military junior college through a program under this chapter and who 

does not have a baccalaureate degree with financial assistance for 

pursuit of a baccalaureate degree. 

(B) Such assistance is in addition to any financial assistance 

provided under paragraph (1) or (3). 

(C) The agreement and reimbursement requirements established in section 2005 of this title are applicable to financial assistance under this paragraph. 

(D) An officer receiving financial assistance under this paragraph shall be attached to a unit of the Army as determined by the 

Secretary and shall be considered to be a member of the Senior Reserve Officers’ Training Corps on inactive duty for training, as defined in section 101(23) of title 38. 

(E) A qualified officer who did not previously receive financial 

assistance under this section is eligible to receive educational assistance under this paragraph. 

(F) A Reserve officer may not be called or ordered to active 

duty for a deployment while participating in the program under 

this paragraph. 

(G) Any service obligation incurred by an officer under an 

agreement entered into under this paragraph shall be in addition 

to any service obligation incurred by that officer under any other 

provision of law or agreement. 

(d) Upon satisfactorily completing the academic and military 

requirements of the four-year program, a cadet or midshipman may 

be appointed as a regular or reserve officer in the appropriate 

armed force in the grade of second lieutenant or ensign, even 

though he is under 21 years of age. 

(e) The date of rank of officers appointed under this section in 

May or June of any year is the date of graduation of cadets or midshipmen from the United States Military Academy, the United 

States Naval Academy, or the United States Air Force Academy, as 

the case may be in that year. The Secretary of the military department concerned shall establish the date of rank of all other officers 

appointed under this section. 

(f) A cadet or midshipman who does not complete the four-year 

course of instruction, or who completes the course but declines to 

accept a commission when offered, may be ordered to active duty 

by the Secretary of the military department concerned to serve in 

his enlisted grade or rating for such period of time as the Secretary 

prescribes but not for more than four years. 

(g) In computing length of service for any purpose, an officer 

appointed under this section may not be credited with service either as a cadet or midshipman or concurrent enlisted service, other 
991 § 2107 CH. 103—SENIOR ROTC 

than concurrent enlisted service performed on or after August 1, 

1979, as a member of the Selected Reserve. 

(h)(1) The Secretary of Defense shall determine the number of 

cadets and midshipmen appointed under this section who may be 

in the financial assistance programs at any one time in each military department. 

(2) Of the total number of cadets appointed in the financial assistance programs under this section in any year, not less than 100 

shall be designated for placement in the program of the Army for 

service upon commissioning in the Army National Guard, of which 

one-half shall be for financial assistance awarded for a period of 

two years and the remainder shall be for financial assistance 

awarded for a period of four years. A cadet designated under this 

paragraph who, having initially contracted for service as provided 

in subsection (b)(5)(A) and having received financial assistance for 

two years under an award providing for four years of financial assistance under this section, modifies such contract with the consent 

of the Secretary of the Army to provide for service as described in 

subsection (b)(5)(B), may be counted, for the year in which the contract is modified, toward the number of appointments required 

under the preceding sentence for financial assistance awarded for 

a period of four years. A cadet who receives financial assistance 

under this paragraph and is commissioned in the Army National 

Guard shall perform service as provided in subsection (b)(5)(B) and 

may not be accepted for service on full-time active duty pursuant 

to the member’s voluntary application until the completion of the 

period of service prescribed in that subsection. The Secretary of the 

Army shall prescribe regulations to ensure a geographical distribution of the cadets who receive financial assistance under this paragraph. 

(i) The Secretary of each military department shall seek to 

achieve an increase in the number of agreements entered into 

under this section so as to achieve an increase, by the 2006–2007 

academic year, of not less than 400 in the number of cadets or midshipmen, as the case may be, enrolled under this section, compared 

to such number enrolled for the 2002–2003 academic year. In the 

case of the Secretary of the Navy, the Secretary shall seek to ensure that not less than one-third of such increase in agreements 

under this section are with students enrolled (or seeking to enroll) 

in programs of study leading to a baccalaureate degree in nuclear 

engineering or another appropriate technical, scientific, or engineering field of study. 

(j)(1) Payment of financial assistance under this section for, 

and payment of a monthly subsistence allowance under section 209 

of title 37 to, a cadet or midshipman appointed under this section 

may be suspended on the basis of health-related incapacity of the 

cadet or midshipman only in accordance with regulations prescribed under paragraph (2). 

(2) The Secretary of Defense shall prescribe in regulations the 

policies and procedures for suspending payments under paragraph 

(1). The regulations shall apply uniformly to all of the military departments. The regulations shall include the following matters: 

(A) The standards of health-related fitness that are to be 

applied. 
§ 2107a CH. 103—SENIOR ROTC 992 

(B) Requirements for— 

(i) the health-related condition and prognosis of a 

cadet or midshipman to be determined, in relation to the 

applicable standards prescribed under subparagraph (A), 

by a health care professional on the basis of a medical examination of the cadet or midshipman; and 

(ii) the Secretary concerned to take into consideration 

the determinations made under clause (i) with respect to 

such condition in deciding whether to suspend payment in 

the case of such cadet or midshipman on the basis of that 

condition. 

(C) A requirement for the Secretary concerned to transmit 

to a cadet or midshipman proposed for suspension under this 

subsection a notification of the proposed suspension together 

with the determinations made under subparagraph (B)(i) in 

the case of the proposed suspension. 

(D) A procedure for a cadet or midshipman proposed for 

suspension under this subsection to submit a written response 

to the proposal for suspension, including any supporting information. 

(E) Requirements for— 

(i) one or more health-care professionals to review, in 

the case of such a response of a cadet or midshipman, each 

health-related condition and prognosis addressed in the response, taking into consideration the matters submitted in 

such response; and 

(ii) the Secretary concerned to take into consideration 

the determinations made under clause (i) with respect to 

such condition in making a final decision regarding whether to suspend payment in the case of such cadet or midshipman on the basis of that condition, and the conditions 

under which such suspension may be lifted. 

(Added Pub. L. 88–647, title II, Sec. 201(1), Oct. 13, 1964, 78 Stat. 1066; amended Pub. L. 92– 

166, Sec. 1, Nov. 24, 1971, 85 Stat. 487; Pub. L. 96–357, Sec. 1(a), (b), Sept. 24, 1980, 94 Stat. 

1178; Pub. L. 96–513, title V, Sec. 511(62), Dec. 12, 1980, 94 Stat. 2925; Pub. L. 97–60, title 

II, Sec. 201, Oct. 14, 1981, 95 Stat. 1005; Pub. L. 98–94, title X, Sec. 1003(a)(3), (c)(1), (2), Sept. 

24, 1983, 97 Stat. 656, 657; Pub. L. 98–525, title V, Sec. 542(a), title XIV, Sec. 1405(33), Oct. 

19, 1984, 98 Stat. 2529, 2624; Pub. L. 100–180, div. A, title V, Sec. 510, Dec. 4, 1987, 101 Stat. 

1087; Pub. L. 102–484, div. A, title V, Sec. 517(a)(2), 532(a), Oct. 23, 1992, 106 Stat. 2407, 2411; 

Pub. L. 104–106, div. A, title V, Sec. 542, Feb. 10, 1996, 110 Stat. 316; Pub. L. 104–201, div. 

A, title V, Secs. 507(a)(2), 553(a), 555(a), Sept. 23, 1996, 110 Stat. 2512, 2526, 2527; Pub. L. 

106–65, div. A, title V, Sec. 545, Oct. 5, 1999, 113 Stat. 608; Pub. L. 107–107, div. A, title V, 

Sec. 534(a), Dec. 28, 2001, 115 Stat. 1106; Pub. L. 107–314, div. A, title V, Sec. 532(d), (e), Dec. 

2, 2002, 116 Stat. 2547; Pub. L. 108–136, div. A, title V, Sec. 521(a), Nov. 24, 2003, 117 Stat. 

1462, 1463; Pub. L. 108–375, div. A, title V, Sec. 524(a), Oct. 28, 2004, 118 Stat. 1888; Pub. 

L. 109–163, div. A, title V, Secs. 531(a), 533(a), 534(a), Jan. 6, 2006, 119 Stat. 3247, 3248.) 

§ 2107a. Financial assistance program for specially selected 

members: Army Reserve and Army National Guard 

(a)(1) The Secretary of the Army may appoint as a cadet in the 

Army Reserve or Army National Guard of the United States any 

eligible member of the program who is enrolled in the Advanced 

Course of the Army Reserve Officers’ Training Corps at a military 

college, military junior college, or civilian institution and who will 

be under 31 years of age on December 31 of the calendar year in 

which he is eligible under this section for appointment as a second 

lieutenant in the Army Reserve or Army National Guard. 
993 § 2107a CH. 103—SENIOR ROTC 

(2) To be considered a military college or military junior college 

for the purposes of this section, a school must be a civilian postsecondary educational institution essentially military in nature and 

meet such other requirements as the Secretary of the Army may 

prescribe. For purposes of this section, a military junior college 

does not confer a baccalaureate degree. 

(b)(1) To be eligible for appointment as a cadet under this section, a member of the program must— 

(A) be a citizen or national of the United States; 

(B) be specially selected for the financial assistance program under this section under procedures prescribed by the 

Secretary of the Army; 

(C) enlist in a reserve component of the Army for the period prescribed by the Secretary of the Army; 

(D) contract, with the consent of his parent or guardian if 

he is a minor, with the Secretary of the Army to serve for the 

period required by the program; 

(E) agree in writing that he will accept an appointment, if 

offered, as a commissioned officer in the Army Reserve or the 

Army National Guard of the United States; and 

(F) agree in writing that he will serve in a troop program 

unit of the Army Reserve or Army National Guard for not less 

than eight years. 

(2) Performance of duty under an agreement under this subsection shall be under such terms and conditions as the Secretary 

of the Army may prescribe and may include periods of active duty, 

active duty for training, and other service in an active or inactive 

status in the reserve component in which appointed. 

(3)(A) Subject to subparagraph (C), in the case of a person described in subparagraph (B), the Secretary may, at any time and 

with the consent of the person, modify an agreement described in 

paragraph (1)(F) submitted by the person for the purpose of reducing or eliminating the troop program unit service obligation specified in the agreement and to establish, in lieu of that obligation, 

an active duty service obligation. 

(B) Subparagraph (A) applies with respect to the following persons: 

(i) A cadet under this section at a military junior college. 

(ii) A cadet or former cadet under this section who is selected under section 2114 of this title to be a medical student 

at the Uniformed Services University of the Health Sciences. 

(iii) A cadet or former cadet under this section who signs 

an agreement under section 2122 of this title for participation 

in the Armed Forces Health Professions Scholarship and Financial Assistance program. 

(C) The modification of an agreement described in paragraph 

(1)(F) may be made only if the Secretary determines that it is in 

the best interests of the United States to do so. 

(c)(1) The Secretary of the Army shall provide for the payment 

of all expenses of the Department of the Army in administering the 

financial assistance program under this section, including the cost 

of tuition, fees, books, and laboratory expenses which are incurred 

by members of the program appointed as cadets under this section 

while such members are students at a military junior college. 
§ 2107a CH. 103—SENIOR ROTC 994 

(2) In the case of a cadet eligible to receive financial assistance 

under paragraph (1), the Secretary of the military department concerned may, in lieu of all or part of the financial assistance described in paragraph (1), provide financial assistance in the form 

of room and board expenses for such cadet and other expenses required by the educational institution. 

[(3) Repealed. Pub. L. 109–163, div. A, title V, Sec. 531(b), Jan. 

6, 2006, 119 Stat. 3247.] 

(4)(A) The Secretary of the Army may provide an individual 

who received a commission as a Reserve officer in the Army from 

a military junior college through a program under this chapter and 

who does not have a baccalaureate degree with financial assistance 

for pursuit of a baccalaureate degree. 

(B) Such assistance is in addition to any provided under paragraph (1) or (2). 

(C) The agreement and reimbursement requirements established in section 2005 of this title are applicable to financial assistance under this paragraph. 

(D) An officer receiving financial assistance under this paragraph shall be attached to a unit of the Army as determined by the 

Secretary and shall be considered to be a member of the Senior Reserve Officers’ Training Corps on inactive duty for training, as defined in section 101(23) of title 38. 

(E) A qualified officer who did not previously receive financial 

assistance under this section is eligible to receive educational assistance under this paragraph. 

(F) A Reserve officer may not be called or ordered to active 

duty for a deployment while participating in the program under 

this paragraph. 

(G) Any service obligation incurred by an officer under an 

agreement entered into under this paragraph shall be in addition 

to any service obligation incurred by that officer under any other 

provision of law or agreement. 

(d) Upon satisfactorily completing the academic and military 

requirements of the program, a cadet may be appointed as a reserve officer in the Army in the grade of second lieutenant, even 

though he is under 21 years of age. 

(e) The date of rank of officers appointed under this section in 

May or June of any year is the date of graduation of cadets from 

the United States Military Academy in that year. The Secretary of 

the Army shall establish the date of rank of all other officers appointed under this section. 

(f) A cadet who does not complete the course of instruction, or 

who completes the course but declines to accept a commission when 

offered, or who does not complete a baccalaureate degree within 

five years after appointment as a cadet under this section, may be 

ordered to active duty by the Secretary of the Army to serve in his 

enlisted grade for such period of time as the Secretary prescribes 

but not for more than four years. 

(g) In computing length of service for any purpose, an officer 

appointed under this section may not be credited with service as 

a cadet or with concurrent enlisted service, other than enlisted 

service performed after August 1, 1979, as a member of the Selected Reserve. 
995 § 2108 CH. 103—SENIOR ROTC 

(h) The Secretary of the Army shall appoint each year under 

this section not less than 22 cadets at each military junior college 

at which there are not less than 22 members of the program eligible under subsection (b) for such an appointment. At any military 

junior college at which in any year there are fewer than 22 such 

members, the Secretary shall appoint each such member as a cadet 

under this section. 

(i) Cadets appointed under this section are in addition to the 

number appointed under section 2107 of this title. 

(j) Financial assistance provided under this section to a cadet 

appointed at a military junior college is designated as, and shall be 

known as, an ‘‘Ike Skelton Early Commissioning Program Scholarship’’. 

(Added Pub. L. 96–357, Sec. 1(c)(1), Sept. 24, 1980, 94 Stat. 1179; amended Pub. L. 102–190, 

div. A, title V, Sec. 522(a), (b)(1), Dec. 5, 1991, 105 Stat. 1362; Pub. L. 104–201, div. A, title 

V, Secs. 507(a)(3), 555(a), Sept. 23, 1996, 110 Stat. 2512, 2527; Pub. L. 105–85, div. A, title X, 

Sec. 1073(a)(36), Nov. 18, 1997, 111 Stat. 1902; Pub. L. 107–107, div. A, title V, Secs. 534(b), 

536(a), (c), Dec. 28, 2001, 115 Stat. 1106, 1107; Pub. L. 108–136, div. A, title V, Secs. 521(b), 

522, Nov. 24, 2003, 117 Stat. 1463; Pub. L. 108–375, div. A, title V, Sec. 524(b), Oct. 28, 2004, 

118 Stat. 1889; Pub. L. 109–163, div. A, title V, Secs. 531(b), 532, 534(b), 536, Jan. 6, 2006, 

119 Stat. 3247–3249; Pub. L. 109–364, div. A, title V, Sec. 535, Oct. 17, 2006, 120 Stat. 2207; 

Pub. L. 110–181, div. A, title V, Secs. 522, 523, Jan. 28, 2008, 122 Stat. 102, 103; Pub. L. 111– 

84, div. A, title V, Sec. 522, Oct. 28, 2009, 123 Stat. 2285.) 

§ 2108. Advanced standing; interruption of training; delay in 

starting obligated service; release from program 

(a) The Secretary of the military department concerned may 

give to any enlisted member of an armed force under his jurisdiction, or any person who has served on active duty in any armed 

force, such advanced standing in the program as may be justified 

by his education and training. 

(b) In determining a member’s eligibility for advanced training, 

the Secretary of the military department concerned may credit him 

with any military training that is substantially equivalent in kind 

to that prescribed for admission to advanced training and was received while he was taking a course of instruction in a program 

under the jurisdiction of another armed force or while he was on 

active duty in the armed forces. 

(c) The Secretary of the military department concerned may excuse from a portion of the prescribed course of military instruction, 

including field training and practice cruises, any person found 

qualified on the basis of his previous education, military experience, or both. 

(d) A person may become, remain, or be readmitted as, a member of the advanced training program after receiving a baccalaureate degree or completing pre-professional studies if he has not 

completed the course of military instruction or all field training or 

practice cruises prescribed by the Secretary of the military department concerned. If a member of the program has been accepted for 

resident graduate or professional study, the Secretary of the military department concerned may delay the commencement of that 

member’s obligated period of active duty, and any obligated period 

of active duty for training or other service in an active or inactive 

status in a reserve component, until the member has completed 

that study. If a cadet appointed under section 2107a of this title 

has been accepted for a course of study at an accredited civilian 
§ 2109 CH. 103—SENIOR ROTC 996 

educational institution authorized to grant baccalaureate degrees, 

the Secretary of the Army may delay the beginning of that member’s obligated period of service in a reserve component until the 

member has completed such course of study. 

(e) The Secretary of the military department concerned may, 

when he determines that the interest of the service so requires, release any person from the program and discharge him from his 

armed force. 

(Added Pub. L. 88–647, title II, Sec. 201(1), Oct. 13, 1964, 78 Stat. 1068; amended Pub. L. 96– 

357, Sec. 1(d), Sept. 24, 1980, 94 Stat. 1180.) 

§ 2109. Practical military training 

(a) For the further practical instruction of members of, and 

designated applicants for membership in, the program, the Secretary of the military department concerned may prescribe and 

conduct practical military training, in addition to field training and 

practice cruises prescribed under section 2104(b)(6) of this title. 

The Secretary concerned may require that some or all of the training prescribed under this subsection must be completed by a member before the member is commissioned. 

(b) The Secretary of the military department concerned, with 

respect to practical military training prescribed under this section 

and field training and practice cruises prescribed under section 

2104(b)(6) of this title, may— 

(1) transport members of, and designated applicants for 

membership in, the program to and from the places designated 

for such training or practice cruises and furnish them subsistence while traveling to and from those places, or, instead of 

furnishing them transportation and subsistence, pay them a 

travel allowance at the rate prescribed for cadets and midshipmen at the United States Military, Naval, and Air Force 

Academies for travel by the shortest usually traveled route 

from the places from which they are authorized to proceed to 

the place designated for the training or cruise and return, and 

pay the allowance for the return trip in advance; 

(2) furnish medical attendance and supplies to members of, 

and designated applicants for membership in, the program 

while attending such training and practice cruises, and admit 

them to military hospitals; 

(3) furnish subsistence, uniform clothing, and equipment to 

members of, and designated applicants for membership in, the 

program while attending such training or practice cruises or, 

instead of furnishing uniform clothing, pay them allowances at 

such rates as he may prescribe; and 

(4) use any member of, and designated applicants for membership in, an armed force, or any employee of the department, 

under his jurisdiction, and such property of the United States 

as he considers necessary, for the training and administration 

of members of, and designated applicants for membership in, 

the program at the places designated for training or practice 

cruises. 

(c)(1) A person who is not qualified for, and (as determined by 

the Secretary concerned) will not be able to become qualified for, 

advanced training by reason of one or more of the requirements 
997 § 2110 CH. 103—SENIOR ROTC 

prescribed in paragraphs (1) through (3) of section 2104(b) of this 

title shall not be permitted to participate in— 

(A) field training or a practice cruise under section 

2104(b)(6) of this title; or 

(B) practical military training under subsection (a). 

(2) The Secretary of the military department concerned may 

waive the limitation in paragraph (1) under procedures prescribed 

by the Secretary. Such procedures shall ensure uniform application 

of limitations and restrictions without regard to the reason for disqualification for advanced training. 

(Added Pub. L. 88–647, title II, Sec. 201(1), Oct. 13, 1964, 78 Stat. 1068; amended Pub. L. 89– 

51, Sec. 2, June 28, 1965, 79 Stat. 173; Pub. L. 89–718, Sec. 17, Nov. 2, 1966, 80 Stat. 1118; 

Pub. L. 100–456, div. A, title VI, Sec. 633(a)(1)–(3)(A), Sept. 29, 1988, 102 Stat. 1986; Pub. L. 

104–201, div. A, title V, Sec. 551(a)(2), Sept. 23, 1996, 110 Stat. 2525; Pub. L. 105–85, div. A, 

title X, Sec. 1073(a)(37), Nov. 18, 1997, 111 Stat. 1902.) 

§ 2110. Logistical support 

(a) The Secretary of the military department concerned may 

issue to institutions having units of the program, or to the officers 

of the armed force concerned who are designated as accountable or 

responsible for such property— 

(1) supplies, means of transportation including aircraft, 

arms and ammunition, and military textbooks and educational 

materials; and 

(2) uniform clothing, except that he may pay monetary allowances for uniform clothing at such rate as he may prescribe. 

(b) The Secretary of the military department concerned may 

provide, or contract with civilian flying or aviation schools or educational institutions to provide, the personnel, aircraft, supplies, facilities, services, and instruction necessary for flight instruction 

and orientation for properly designated members of the program. 

(c) The Secretary of the military department concerned may 

transport members of, and designated applicants for membership 

in, the program to and from installations when it is necessary for 

them to undergo medical or other examinations or for the purposes 

of making visits of observation. He may also furnish them subsistence, quarters, and necessary medical care, including hospitalization, while they are at, or traveling to or from, such an installation. 

(d) The Secretary of the military department concerned may 

authorize members of, and designated applicants for membership 

in, the program to participate in aerial flights in military aircraft 

and in indoctrination cruises in naval vessels. 

(e) The Secretary of the military department concerned may 

authorize such expenditures as he considers necessary for the efficient maintenance of the program. 

(f) The Secretary of the military department concerned shall 

require, from each institution to which property is issued under 

subsection (a), a bond or other indemnity in such amount as he 

considers adequate, but not less than $5,000, for the care and safekeeping of all property so issued except uniforms, expendable articles, and supplies expended in operation, maintenance, and instruction. The Secretary may accept a bond without surety if the institution to which the property is issued furnishes to him satisfactory 

evidence of its financial responsibility. 
§ 2111 CH. 103—SENIOR ROTC 998 

(Added Pub. L. 88–647, title II, Sec. 201(1), Oct. 13, 1964, 78 Stat. 1069; amended Pub. L. 89– 

718, Sec. 18, Nov. 2, 1966, 80 Stat. 1118; Pub. L. 94–273, Sec. 11(2), Apr. 21, 1976, 90 Stat. 

378; Pub. L. 97–375, title I, Sec. 104(c), Dec. 21, 1982, 96 Stat. 1819.) 

§ 2111. Personnel: administrators and instructors 

The Secretary of the military department concerned may detail 

regular or reserve members of an armed force under his jurisdiction (including retired members and members of the Fleet Reserve 

and Fleet Marine Corps Reserve recalled to active duty with their 

consent) for instructional and administrative duties at educational 

institutions where units of the program are maintained. 

(Added Pub. L. 88–647, title II, Sec. 201(1), Oct. 13, 1964, 78 Stat. 1069.) 

§ 2111a. Support for senior military colleges 

(a) DETAIL OF OFFICERS TO SERVE AS COMMANDANT OR ASSISTANT COMMANDANT OF CADETS.—(1) Upon the request of a senior 

military college, the Secretary of Defense may detail an officer on 

the active-duty list to serve as Commandant of Cadets at that college or (in the case of a college with an Assistant Commandant of 

Cadets) detail an officer on the active-duty list to serve as Assistant Commandant of Cadets at that college (but not both). 

(2) In the case of an officer detailed as Commandant of Cadets, 

the officer may, upon the request of the college, be assigned from 

among the Professor of Military Science, the Professor of Naval 

Science (if any), and the Professor of Aerospace Science (if any) at 

that college or may be in addition to any other officer detailed to 

that college in support of the program. 

(3) In the case of an officer detailed as Assistant Commandant 

of Cadets, the officer may, upon the request of the college, be assigned from among officers otherwise detailed to duty at that college in support of the program or may be in addition to any other 

officer detailed to that college in support of the program. 

(b) DESIGNATION OF OFFICERS AS TACTICAL OFFICERS.—Upon 

the request of a senior military college, the Secretary of Defense 

may authorize officers (other than officers covered by subsection 

(a)) who are detailed to duty as instructors at that college to act 

simultaneously as tactical officers (with or without compensation) 

for the Corps of Cadets at that college. 

(c) DETAIL OF OFFICERS.—The Secretary of a military department shall designate officers for detail to the program at a senior 

military college in accordance with criteria provided by the college. 

An officer may not be detailed to a senior military college without 

the approval of that college. 

(d) TERMINATION OR REDUCTION OF PROGRAM PROHIBITED.— 

The Secretary of Defense and the Secretaries of the military departments may not take or authorize any action to terminate or reduce a unit of the Senior Reserve Officers’ Training Corps at a senior military college unless the termination or reduction is specifically requested by the college. 

(e) ASSIGNMENT TO ACTIVE DUTY.—(1) The Secretary of the 

Army shall ensure that a graduate of a senior military college who 

desires to serve as a commissioned officer on active duty upon 

graduation from the college, who is medically and physically qualified for active duty, and who is recommended for such duty by the 
999 § 2111b CH. 103—SENIOR ROTC 

professor of military science at the college, shall be assigned to active duty. 

(2) Nothing in this section shall be construed to prohibit the 

Secretary of the Army from requiring a member of the program 

who graduates from a senior military college to serve on active 

duty. 

(f) SENIOR MILITARY COLLEGES.—The senior military colleges 

are the following: 

(1) Texas A&M University. 

(2) Norwich University. 

(3) The Virginia Military Institute. 

(4) The Citadel. 

(5) Virginia Polytechnic Institute and State University. 

(6) North Georgia College and State University. 

(Added Pub. L. 104–106, div. A, title V, Sec. 545(a), Feb. 10, 1996, 110 Stat. 317; amended Pub. 

L. 105–85, div. A, title V, Sec. 544(d)–(f)(1), Nov. 18, 1997, 111 Stat. 1745, 1746; Pub. L. 106– 

65, div. A, title V, Sec. 541(c), Oct. 5, 1999, 113 Stat. 607.) 

§ 2111b. Senior military colleges: Department of Defense 

international student program 

(a) PROGRAM REQUIREMENT.—The Secretary of Defense shall 

establish a program to facilitate the enrollment and instruction of 

persons from foreign countries as international students at the senior military colleges. 

(b) PURPOSES.—The purposes of the program shall be— 

(1) to provide a high-quality, cost-effective military-based 

educational experience for international students in furtherance of the military-to-military program objectives of the Department of Defense; and 

(2) to enhance the educational experience and preparation 

of future United States military leaders through increased, extended interaction with highly qualified potential foreign military leaders. 

(c) COORDINATION WITH THE SENIOR MILITARY COLLEGES.— 

Guidelines for implementation of the program shall be developed in 

coordination with the senior military colleges. 

(d) RECOMMENDATIONS FOR ADMISSION OF STUDENTS UNDER

THE PROGRAM.—The Secretary of Defense shall annually identify to 

the senior military colleges the international students who, based 

on criteria established by the Secretary, the Secretary recommends 

be considered for admission under the program. The Secretary 

shall identify the recommended international students to the senior 

military colleges as early as possible each year to enable those colleges to consider them in a timely manner in their respective admissions processes. 

(e) DOD FINANCIAL SUPPORT.—An international student who is 

admitted to a senior military college under the program under this 

section is responsible for the cost of instruction at that college. The 

Secretary of Defense may, from funds available to the Department 

of Defense other than funds available for financial assistance under 

section 2107a of this title, provide some or all of the costs of instruction for any such student. 

(Added Pub. L. 106–65, div. A, title V, Sec. 541(a)(1), Oct. 5, 1999, 113 Stat. 606.) 
1000 

CHAPTER 104—UNIFORMED SERVICES UNIVERSITY OF 

THE HEALTH SCIENCES 

Sec. 

2112. Establishment. 

2112a. Continued operation of University. 

2113. Administration of University. 

2113a. Board of Regents. 

2114. Students: selection; status; obligation. 

2115. Graduates: limitation on number permitted to perform civilian Federal 

service. 

2116. Military nursing research. 

[2117. Repealed.] 

§ 2112. Establishment 

(a) There is hereby authorized to be established within 25 

miles of the District of Columbia a Uniformed Services University 

of the Health Sciences (hereinafter in this chapter referred to as 

the ‘‘University’’), at a site or sites to be selected by the Secretary 

of Defense, with authority to grant appropriate advanced degrees. 

It shall be so organized as to graduate not less than 100 medical 

students annually. 

(b) Except as provided in subsection (a), the numbers of persons to be graduated from the University shall be prescribed by the 

Secretary of Defense. In so prescribing the number of persons to be 

graduated from the University, the Secretary of Defense shall institute actions necessary to ensure the maximum number of first-year 

enrollments in the University consistent with the academic capacity of the University and the needs of the uniformed services for 

medical personnel. 

(c) The development of the University may be by such phases 

as the Secretary of Defense may prescribe subject to the requirements of subsection (a). 

(Added Pub. L. 92–426, Sec. 2(a), Sept. 21, 1972, 86 Stat. 713; amended Pub. L. 96–107, title 

VIII, Sec. 803(a), Nov. 9, 1979, 93 Stat. 811; Pub. L. 96–513, title V, Sec. 511(63), (64), Dec. 

12, 1980, 94 Stat. 2925, 2926; Pub. L. 104–106, div. A, title X, Sec. 1072(b)(1), Feb. 10, 1996, 

110 Stat. 446; Pub. L. 107–107, div. A, title X, Sec. 1048(e)(8), Dec. 28, 2001, 115 Stat. 1228.) 

§ 2112a. Continued operation of University 

(a) CLOSURE PROHIBITED.—The University may not be closed. 

(b) PERSONNEL STRENGTH.—During the five-year period beginning on October 1, 1996, the personnel staffing levels for the University may not be reduced below the personnel staffing levels for 

the University as of October 1, 1993. 

(Added Pub. L. 104–201, div. A, title IX, Sec. 907(a)(1), Sept. 23, 1996, 110 Stat. 2620.) 

§ 2113. Administration of University 

(a) The business of the University shall be conducted by the 

Secretary of Defense with funds appropriated for and provided by 

the Department of Defense. 
1001 § 2113 CH. 104—UNIVERSITY OF THE HEALTH SCIENCES 

(b) The Secretary shall appoint a President of the University 

(hereinafter in this chapter referred to as the ‘‘President’’). 

(c)(1) The Secretary, after considering the recommendations of 

the President, shall obtain the services of such military and civilian 

professors, instructors, and administrative and other employees as 

may be necessary to operate the University. Civilian members of 

the faculty and staff shall be employed under salary schedules and 

granted retirement and other related benefits prescribed by the 

Secretary (after due consideration by the Secretary) so as to place 

the employees of the University on a comparable basis with the 

employees of fully accredited schools of the health professions identified by the Secretary for purposes of this paragraph. 

(2) The Secretary may confer academic titles, as appropriate, 

upon military and civilian members of the faculty. 

(3) The military members of the faculty shall include a professor of military, naval, or air science as the Secretary may determine. 

(4) The limitations in sections 5307 and 5373 of title 5 do not 

apply to the authority of the Secretary under paragraph (1) to prescribe salary schedules and other related benefits. In no event may 

the total amount of compensation paid to an employee under paragraph (1) in any year (including salary, allowances, differentials, 

bonuses, awards, and other similar cash payments) exceed the total 

amount of annual compensation (excluding expenses) specified in 

section 102 of title 3. 

(d) The Secretary may negotiate agreements with agencies of 

the Federal Government to utilize on a reimbursable basis appropriate existing Federal medical resources located in or near the 

District of Columbia. Under such agreements the facilities concerned will retain their identities and basic missions. The Secretary 

may negotiate affiliation agreements with an accredited university 

or universities in or near the District of Columbia. Such agreements may include provisions for payments for educational services 

provided students participating in Department of Defense educational programs. The Secretary may enter into an agreement 

under which the University would become part of a national university of health sciences should such an institution be established 

in the vicinity of the District of Columbia. 

(e) The Secretary of Defense may establish the following educational programs at the University: 

(1) Postdoctoral, postgraduate, and technological institutes. 

(2) A graduate school of nursing. 

(3) Other schools or programs that the Secretary determines necessary in order to operate the University in a costeffective manner. 

(f) The Secretary shall also establish programs in continuing 

medical education for military members of the health professions 

to the end that high standards of health care may be maintained 

within the military medical services. 

(g)(1) The Secretary also is authorized— 

(A) to enter into contracts with, accept grants from, and 

make grants to the Henry M. Jackson Foundation for the Advancement of Military Medicine established under section 178 

of this title, or any other nonprofit entity, for the purpose of 
§ 2113 CH. 104—UNIVERSITY OF THE HEALTH SCIENCES 1002 

carrying out cooperative enterprises in medical research, medical consultation, and medical education; 

(B) to make available to the Henry M. Jackson Foundation 

for the Advancement of Military Medicine, on such terms and 

conditions as the Secretary determines appropriate, such 

space, facilities, equipment, and support services within the 

University as the Secretary considers necessary to accomplish 

cooperative enterprises undertaken by such Foundation and 

the University; 

(C) to enter into contracts with the Henry M. Jackson 

Foundation for the Advancement of Military Medicine under 

which the Secretary may furnish the services of such professional, technical, or clerical personnel as may be necessary to 

fulfill cooperative enterprises undertaken by such foundation 

and the University; 

(D) to accept, hold, administer, invest, and spend any gift, 

devise, or bequest of personal property made to the University, 

including any gift, devise, or bequest for the support of an academic chair, teaching, research, or demonstration project; 

(E) to enter into agreements with the Henry M. Jackson 

Foundation for the Advancement of Military Medicine, or with 

any other nonprofit entity, under which scientists or other personnel of the Foundation or other entity may be utilized by the 

University for the purpose of enhancing the activities of the 

University in education, research, and technological applications of knowledge; and 

(F) to accept the voluntary services of guest scholars and 

other persons. 

(2) The Secretary may not enter into any contract with the 

Henry M. Jackson Foundation for the Advancement of Military 

Medicine, or with any other entity, if the contract would obligate 

the University to make outlays in advance of the enactment of 

budget authority for such outlays. 

(3) Scientists or other medical personnel utilized by the University under an agreement described in clause (E) of paragraph (1) 

may be appointed to any position within the University and may 

be permitted to perform such duties within the University as the 

Secretary may approve. 

(4) A person who provides voluntary services under the authority of clause (F) of paragraph (1) shall be considered to be an employee of the Federal Government for the purposes of chapter 81 

of title 5, relating to compensation for work-related injuries, and to 

be an employee of the Federal Government for the purposes of 

chapter 171 of title 28, relating to tort claims. Such a person who 

is not otherwise employed by the Federal Government shall not be 

considered to be a Federal employee for any other purpose by reason of the provision of such services. 

(Added Pub. L. 92–426, Sec. 2(a), Sept. 21, 1972, 86 Stat. 714; amended Pub. L. 95–589, Nov. 

4, 1978, 92 Stat. 2512; Pub. L. 96–513, title V, Sec. 511(64), Dec. 12, 1980, 94 Stat. 2926; Pub. 

L. 98–36, Sec. 3, May 27, 1983, 97 Stat. 201; Pub. L. 98–132, Sec. 2(b), Oct. 17, 1983, 97 Stat. 

849; Pub. L. 99–661, div. A, title V, Sec. 505, Nov. 14, 1986, 100 Stat. 3864; Pub. L. 101–189, 

div. A, title VII, Sec. 726(a), (b)(1), Nov. 29, 1989, 103 Stat. 1480; Pub. L. 101–510, div. A, title 

XIII, Sec. 1322(a)(3), Nov. 5, 1990, 104 Stat. 1671; Pub. L. 104–106, div. A, title X, Sec. 1072(a), 

(b)(2), (c)(1), Feb. 10, 1996, 110 Stat. 446; Pub. L. 106–65, div. A, title XI, Sec. 1108, Oct. 5, 

1999, 113 Stat. 778; Pub. L. 106–398, Sec. 1 [[div. A], title X, Sec. 1087(a)(12)], Oct. 30, 2000, 
1003 § 2114 CH. 104—UNIVERSITY OF THE HEALTH SCIENCES 

114 Stat. 1654, 1654A–291; Pub. L. 110–181, div. A, title IX, Sec. 954(a)(3)(A),(b)(1), title XI, 

Sec. 1116, Jan. 28, 2008, 122 Stat. 294, 361.) 

§ 2113a. Board of Regents 

(a) IN GENERAL.—To assist the Secretary of Defense in an advisory capacity, there is a Board of Regents of the University. 

(b) MEMBERSHIP.—The Board shall consist of— 

(1) nine persons outstanding in the fields of health care, 

higher education administration, or public policy who shall be 

appointed from civilian life by the Secretary of Defense; 

(2) the Secretary of Defense, or his designee, who shall be 

an ex officio member; 

(3) the surgeons general of the uniformed services, who 

shall be ex officio members; and 

(4) the President of the University, who shall be a nonvoting ex officio member. 

(c) TERM OF OFFICE.—The term of office of each member of the 

Board (other than ex officio members) shall be six years except 

that— 

(1) any member appointed to fill a vacancy occurring before the expiration of the term for which his predecessor was 

appointed shall be appointed for the remainder of such term; 

and 

(2) any member whose term of office has expired shall continue to serve until his successor is appointed. 

(d) CHAIRMAN.—One of the members of the Board (other than 

an ex officio member) shall be designated by the Secretary as 

Chairman. He shall be the presiding officer of the Board. 

(e) COMPENSATION.—Members of the Board (other than ex officio members) while attending conferences or meetings or while otherwise performing their duties as members shall be entitled to receive compensation at a rate to be fixed by the Secretary and shall 

also be entitled to receive an allowance for necessary travel expenses while so serving away from their place of residence. 

(f) MEETINGS.—The Board shall meet at least once a quarter. 

(Added Pub. L. 110–181, div. A, title IX, Sec. 954(a)(1), Jan. 28, 2008, 122 Stat. 293; amended 

Pub. L. 111–84, div. A, title V, Sec. 523, Oct. 28, 2009, 123 Stat. 2285.) 

§ 2114. Students: selection; status; obligation 

(a) Medical students at the University shall be selected under 

procedures prescribed by the Secretary of Defense. In so prescribing, the Secretary shall consider the recommendations of the 

Board. However, selection procedures prescribed by the Secretary 

of Defense shall emphasize the basic requirement that students 

demonstrate sincere motivation and dedication to a career in the 

uniformed services (as defined in section 1072(1) of this title). 

(b)(1) Medical students shall be commissioned officers of a uniformed service as determined under regulations prescribed by the 

Secretary of Defense after consulting with the Secretary of Health 

and Human Services. They shall be appointed as regular officers in 

the grade of second lieutenant or ensign and shall serve on active 

duty in that grade. 

(2) If a member of the uniformed services selected to be a student has prior active service in a pay grade and with years of service credited for pay that would entitle the member, if the member 
§ 2114 CH. 104—UNIVERSITY OF THE HEALTH SCIENCES 1004 

remained in the former grade, to a rate of basic pay in excess of 

the rate of basic pay for regular officers in the grade of second lieutenant or ensign, the member shall be paid basic pay based on the 

former grade and years of service credited for pay. The amount of 

such basic pay for the member shall be increased on January 1 of 

each year by the percentage by which basic pay is increased on average on that date for that year, and the member shall continue 

to receive basic pay based on the former grade and years of service 

until the date, whether occurring before or after graduation, on 

which the basic pay for the member in the member’s actual grade 

and years of service credited for pay exceeds the amount of basic 

pay to which the member is entitled based on the member’s former 

grade and years of service. 

(c) Medical students who graduate shall be required to serve 

on active duty unless they are covered by section 2115 of this title. 

Medical students who graduate shall be required, except as provided in section 2115 of this title, to serve thereafter on active duty 

under such regulations as the Secretary of Defense or the Secretary 

of Health and Human Services, as appropriate, may prescribe for 

not less than seven years, unless sooner released. Upon completion 

of, or release from, the active-duty service obligation, a member of 

the program who served on active-duty for less than 10 years shall 

serve in the Ready Reserve for the period specified in the following 

table: 

Period of Service Ready Reserve 

on Active Duty Obligation 

Less than 8 years ........................................................................... 6 years 

8 years or more, but less than 9 .................................................... 4 years 

9 years or more, but less than 10 .................................................. 2 years 

The service credit exclusions specified in section 2126 of this title 

shall apply to students covered by this section. 

(d) A period of time spent in military intern or residency training shall not be creditable in satisfying a commissioned service obligation imposed by this section. 

(e) A medical student who, under regulations prescribed by the 

Secretary of Defense, is dropped from the program for deficiency in 

conduct or studies, or for other reasons, may be required to perform 

active duty in an appropriate military capacity in accordance with 

the active duty obligation imposed by this section. In no case shall 

any such student be required to serve on active duty for any period 

in excess of a period equal to the period he participated in the program, except that in no case may any such student be required to 

serve on active duty less than one year. 

(f)(1) The Secretary of Defense may enter into agreements with 

foreign military medical schools for reciprocal education programs 

under which students at the University receive specialized military 

medical instruction at the foreign military medical school and military medical personnel of the country of such medical school receive specialized military medical instruction at the University. 

Any such agreement may be made on a reimbursable basis or a 

nonreimbursable basis. 

(2) Not more than 40 persons at any one time may receive instruction at the University under this subsection. Attendance of 

such persons at the University may not result in a decrease in the 
1005 § 2114 CH. 104—UNIVERSITY OF THE HEALTH SCIENCES 

number of students enrolled in the University. Subsection (b) does 

not apply to students receiving instruction under this subsection. 

(3) The President of the University, with the approval of the 

Secretary of Defense, shall determine the countries from which persons may be selected to receive instruction under this subsection 

and the number of persons that may be selected from each country. 

The President may establish qualifications and methods of selection and shall select those persons who will be permitted to receive 

instruction at the University. The qualifications established shall 

be comparable to those required of United States citizens. 

(4) Each foreign country from which a student is permitted to 

receive instruction at the University under this subsection shall reimburse the United States for the cost of providing such instruction, unless such reimbursement is waived by the Secretary of Defense. The Secretary of Defense shall prescribe the rates for reimbursement under this paragraph. 

(5) Except as the President determines, a person receiving instruction at the University under this subsection is subject to the 

same regulations governing attendance, discipline, discharge, and 

dismissal as a student enrolled in the University. The Secretary 

may prescribe regulations with respect to access to classified information by a person receiving instruction under this subsection that 

differ from the regulations that apply to a student enrolled in the 

University. 

(g) In this section, the term ‘‘commissioned service obligation’’ 

means, with respect to an officer who is a graduate of the University, the period beginning on the date of the appointment of the officer in a regular component after graduation and ending on the 

tenth anniversary of that appointment. 

(h) The Secretary of Defense shall establish such selection procedures, service obligations, and other requirements as the Secretary considers appropriate for graduate students (other than 

medical students) in a postdoctoral, postgraduate, or technological 

institute established pursuant to section 2113(e) of this title. 

(i) A graduate of the University who is relieved of the graduate’s active-duty service obligation under subsection (c) before the 

completion of that active-duty service obligation may be given, with 

or without the consent of the graduate, an alternative obligation in 

the same manner as provided in subparagraphs (A) and (B) of 

paragraph (1) of section 2123(e) of this title or paragraph (2) of 

such section for members of the Armed Forces Health Professions 

Scholarship and Financial Assistance program. 

(Added Pub. L. 92–426, Sec. 2(a), Sept. 21, 1972, 86 Stat. 715; amended Pub. L. 96–107, title 

VIII, Sec. 803(b), Nov. 9, 1979, 93 Stat. 812; Pub. L. 96–513, title I, Sec. 114, title V, Sec. 

511(65), Dec. 12, 1980, 94 Stat. 2877, 2926; Pub. L. 98–525, title XV, Sec. 1535, Oct. 19, 1984, 

98 Stat. 2633; Pub. L. 101–189, div. A, title V, Sec. 511(a), Nov. 29, 1989, 103 Stat. 1439; Pub. 

L. 101–510, div. A, title V, Sec. 533(a), (b), Nov. 5, 1990, 104 Stat. 1564; Pub. L. 103–160, div. 

A, title VII, Sec. 732(a), Nov. 30, 1993, 107 Stat. 1696; Pub. L. 104–106, div. A, title X, Sec. 

1072(b)(3), Feb. 10, 1996, 110 Stat. 446; Pub. L. 104–201, div. A, title VII, Sec. 741(b), Sept. 

23, 1996, 110 Stat. 2599; Pub. L. 105–85, div. A, title X, Sec. 1073(a)(38), Nov. 18, 1997, 111 

Stat. 1902; Pub. L. 108–375, div. A, title V, Sec. 501(e), Oct. 28, 2004, 118 Stat. 1874; Pub. L. 

110–181, div. A, title V, Sec. 524(a), title IX, Sec. 954(a)(3)(B), (b)(2), Jan. 28, 2008, 122 Stat. 

103, 294; Pub. L. 110–417, [div. A], title X, Sec. 1061(b)(8), (9), Oct. 14, 2008, 122 Stat. 4613.) 
§ 2115 CH. 104—UNIVERSITY OF THE HEALTH SCIENCES 1006 

§ 2115. Graduates: limitation on number permitted to perform civilian Federal service 

The Secretary of Defense may allow not more than 20 percent 

of the graduates of each class at the University to perform civilian 

Federal service for not less than seven years following the completion of their professional education in lieu of active duty in a uniformed service if the needs of the uniformed services do not require 

that such graduates perform active duty in a uniformed service and 

as long as the Secretary of Defense does not recall such persons to 

active duty in the uniformed services. Such persons who execute an 

agreement in writing to perform such civilian Federal service may 

be released from active duty following the completion of their professional education. The location and type of their duty shall be determined by the Secretary of Defense after consultation with the 

heads of Federal agencies concerned. 

(Added Pub. L. 92–426, Sec. 2(a), Sept. 21, 1972, 86 Stat. 716; amended Pub. L. 96–107, title 

VIII, Sec. 803(c)(1), (2), Nov. 9, 1979, 93 Stat. 812.) 

§ 2116. Military nursing research 

(a) DEFINITIONS.—In this section: 

(1) The term ‘‘military nursing research’’ means research 

on the furnishing of care and services by nurses in the armed 

forces. 

(2) The term ‘‘TriService Nursing Research Program’’ 

means the program of military nursing research authorized 

under this section. 

(b) PROGRAM AUTHORIZED.—The Secretary of Defense may establish at the University a program of military nursing research. 

(c) TRISERVICE RESEARCH GROUP.—The TriService Nursing Research Program shall be administered by a TriService Nursing Research Group composed of Army, Navy, and Air Force nurses who 

are involved in military nursing research and are designated by the 

Secretary concerned to serve as members of the group. 

(d) DUTIES OF GROUP.—The TriService Nursing Research 

Group shall— 

(1) develop for the Department of Defense recommended 

guidelines for requesting, reviewing, and funding proposed 

military nursing research projects; and 

(2) make available to Army, Navy, and Air Force nurses 

and Department of Defense officials concerned with military 

nursing research— 

(A) information about nursing research projects that 

are being developed or carried out in the Army, Navy, and 

Air Force; and 

(B) expertise and information beneficial to the encouragement of meaningful nursing research. 

(e) RESEARCH TOPICS.—For purposes of this section, military 

nursing research includes research on the following issues: 

(1) Issues regarding how to improve the results of nursing 

care and services provided in the armed forces in time of peace. 

(2) Issues regarding how to improve the results of nursing 

care and services provided in the armed forces in time of war. 

(3) Issues regarding how to prevent complications associated with battle injuries. 
1007 [§ 2117 CH. 104—UNIVERSITY OF THE HEALTH SCIENCES 

(4) Issues regarding how to prevent complications associated with the transporting of patients in the military medical 

evacuation system. 

(5) Issues regarding how to improve methods of training 

nursing personnel. 

(6) Clinical nursing issues, including such issues as prevention and treatment of child abuse and spouse abuse. 

(7) Women’s health issues. 

(8) Wellness issues. 

(9) Preventive medicine issues. 

(10) Home care management issues. 

(11) Case management issues. 

(Added Pub. L. 104–106, div. A, title VII, Sec. 741(a), Feb. 10, 1996, 110 Stat. 384.) 

[§ 2117. Repealed. Pub. L. 111–84, div. A, title V, Sec. 

525(a)(1), Oct. 28, 2009, 123 Stat. 2286] 
1008 

CHAPTER 105—ARMED FORCES HEALTH PROFESSIONS 

FINANCIAL ASSISTANCE PROGRAMS 

Subchapter Sec. 

I. Health Professions Scholarship and Financial Assistance Program for 

Active Service .......................................................................................... 2120

II. Nurse Officer Candidate Accession Program ........................................... 2130a 

SUBCHAPTER I—HEALTH PROFESSIONS SCHOLARSHIP AND 

FINANCIAL ASSISTANCE PROGRAM FOR ACTIVE SERVICE 

Sec. 

2120. Definitions. 

2121. Establishment. 

2122. Eligibility for participation. 

2123. Members of the program: active duty obligation; failure to complete training; release from program. 

2124. Members of the program: numbers appointed. 

2125. Members of the program: exclusion from authorized strengths. 

2126. Members of the program: service credit. 

2127. Scholarships and financial assistance: payments. 

2128. Accession bonus for members of the program. 

§ 2120. Definitions 

In this subchapter: 

(1) The term ‘‘program’’ means the Armed Forces Health 

Professions Scholarship and Financial Assistance program provided for in this subchapter. 

(2) The term ‘‘member of the program’’ means a person appointed a commissioned officer in a reserve component of the 

armed forces who is enrolled in the Armed Forces Health Professions Scholarship and Financial Assistance program. 

(3) The term ‘‘course of study’’ means education received at 

an accredited college, university, or institution in medicine, 

dentistry, or other health profession, leading, respectively, to a 

degree related to the health professions as determined under 

regulations prescribed by the Secretary of Defense. 

(4) The term ‘‘specialized training’’ means advanced training in a health professions specialty received in an accredited 

program that is beyond the basic education required for appointment as a commissioned officer with a designation as a 

health professional. 

(Added Pub. L. 92–426, Sec. 2(a), Sept. 21, 1972, 86 Stat. 717; amended Pub. L. 98–94, title 

XII, Sec. 1268(13), Sept. 24, 1983, 97 Stat. 706; Pub. L. 100–26, Sec. 7(k)(2), Apr. 21, 1987, 101 

Stat. 284; Pub. L. 100–180, div. A, title VII, Sec. 711(a)(2), Dec. 4, 1987, 101 Stat. 1108; Pub. 

L. 101–189, div. A, title VII, Sec. 725(a), (h)(1), Nov. 29, 1989, 103 Stat. 1478, 1480.) 

§ 2121. Establishment 

(a)(1) For the purpose of obtaining adequate numbers of commissioned officers on active duty who are qualified (A) in the various health professions or (B) as a health professional with specific 

skills to assist in providing mental health care to members of the 
1009 § 2121 CH. 105—HEALTH PROFESSIONS FINANCIAL ASSISTANCE PGMS

armed forces, the Secretary of each military department, under regulations prescribed by the Secretary of Defense, may establish and 

maintain a health professions scholarship and financial assistance 

program for his department. 

(2) Under the program of a military department, the Secretary 

of that military department shall allocate a portion of the total 

number of scholarships to members of the program described in 

paragraph (1)(B) for the purpose of assisting such members to pursue a degree at the masters and doctoral level in any of the following disciplines: 

(A) Social work. 

(B) Clinical psychology. 

(C) Psychiatry. 

(D) Other disciplines that contribute to mental health care 

programs in that military department. 

(b) The program shall consist of courses of study and specialized training in designated health professions, with obligatory periods of military training. 

(c)(1) Persons participating in the program shall be commissioned officers in reserve components of the armed forces. Members 

pursuing a course of study shall serve on active duty in pay grade 

O–1 with full pay and allowances of that grade for a period of 45 

days during each year of participation in the program. Members 

pursuing specialized training shall serve on active duty in a pay 

grade commensurate with their educational level, as determined by 

appointment under section 12207 of this title, with full pay and allowances of that grade for a period of 14 days during each year of 

participation in the program. They shall be detailed as students at 

accredited civilian institutions, located in the United States or 

Puerto Rico, for the purpose of acquiring knowledge or training in 

a designated health profession. In addition, members of the program shall, under regulations prescribed by the Secretary of Defense, receive military and professional training and instruction. 

(2) If a member of the uniformed services selected to participate in the program as a medical student has prior active service 

in a pay grade and with years of service credited for pay that 

would entitle the member, if the member remained in the former 

grade, to a rate of basic pay in excess of the rate of basic pay for 

regular officers in the grade of second lieutenant or ensign, the 

member shall be paid basic pay based on the former grade and 

years of service credited for pay. The amount of such basic pay for 

the member shall be increased on January 1 of each year by the 

percentage by which basic pay is increased on average on that date 

for that year, and the member shall continue to receive basic pay 

based on the former grade and years of service until the date, 

whether occurring before or after the conclusion of such participation, on which the basic pay for the member in the member’s actual 

grade and years of service credited for pay exceeds the amount of 

basic pay to which the member is entitled based on the member’s 

former grade and years of service. 

(d) Except when serving on active duty pursuant to subsection 

(c), a member of the program shall be entitled to a stipend at a 

monthly rate established by the Secretary of Defense, but not to exceed a total of $30,000 per year. The maximum annual amount of 
§ 2122 CH. 105—HEALTH PROFESSIONS FINANCIAL ASSISTANCE PGMS 1010 

the stipend shall be increased annually by the Secretary of Defense 

effective on July 1 of each year by an amount (rounded to the next 

highest multiple of $1) equal to— 

(1) the amount of such stipend (as previously adjusted (if 

at all)), multiplied by 

(2) the overall percentage of the adjustment (if such adjustment is an increase) in the rates of basic pay for members 

of the uniformed services made effective for the fiscal year in 

which the school year ends. 

(Added Pub. L. 92–426, Sec. 2(a), Sept. 21, 1972, 86 Stat. 717; amended Pub. L. 96–107, title 

VIII, Sec. 804(a), Nov. 9, 1979, 93 Stat. 812; Pub. L. 98–94, title IX, Sec. 935(a), Sept. 24, 1983, 

97 Stat. 652; Pub. L. 101–189, div. A, title VII, Sec. 725(b), Nov. 29, 1989, 103 Stat. 1479; Pub. 

L. 101–510, div. A, title XIV, Sec. 1484(k)(7), Nov. 5, 1990, 104 Stat. 1719; Pub. L. 104–106, 

div. A, title XV, Sec. 1501(c)(22), Feb. 10, 1996, 110 Stat. 499; Pub. L. 109–364, div. A, title 

V, Sec. 538(a), Oct. 17, 2006, 120 Stat. 2209; Pub. L. 110–181, div. A, title V, Sec. 524(b), Jan. 

28, 2008, 122 Stat. 103; Pub. L. 111–84, div. A, title V, Sec. 524(a), Oct. 28, 2009, 123 Stat. 

2285.) 

§ 2122. Eligibility for participation 

(a) To be eligible for participation as a member of the program, 

a person must be a citizen of the United States and must— 

(1) be accepted for admission to, or enrolled in, an institution in a course of study or selected to receive specialized training; 

(2) sign an agreement that unless sooner separated he 

will— 

(A) complete the educational phase of the program; 

(B) accept an appropriate reappointment or designation within his military service, if tendered, based upon his 

health profession, following satisfactory completion of the 

program; 

(C) participate in the intern program of his service if 

selected for such participation; 

(D) participate in the residency program of his service, 

if selected, or be released from active duty for the period 

required to undergo civilian residency if selected for such 

training; and 

(E) because of his sincere motivation and dedication to 

a career in the uniformed services, participate in military 

training while he is in the program, under regulations prescribed by the Secretary of Defense; and 

(3) meet the requirements for appointment as a commissioned officer. 

(b) The Secretary of Defense may require, as part of the agreement under subsection (a)(2), that a person must agree to accept, 

if offered, residency training in a health profession skill which has 

been designated by the Secretary as a critically needed wartime 

skill. 

(Added Pub. L. 92–426, Sec. 2(a), Sept. 21, 1972, 86 Stat. 717; amended Pub. L. 100–180, div. 

A, title VII, Sec. 712(a), Dec. 4, 1987, 101 Stat. 1112; Pub. L. 101–189, div. A, title VII, Sec. 

725(c), Nov. 29, 1989, 103 Stat. 1479.) 

§ 2123. Members of the program: active duty obligation; failure to complete training; release from program 

(a) A member of the program incurs an active duty obligation. 

The amount of his obligation shall be determined under regulations 
1011 § 2124 CH. 105—HEALTH PROFESSIONS FINANCIAL ASSISTANCE PGMS

prescribed by the Secretary of Defense, but those regulations may 

not provide for a period of obligation of less than one year for each 

year of participation in the program. 

(b) A period of time spent in military intern or residency training shall not be creditable in satisfying an active duty obligation 

imposed by this section. 

(c) A member of the program who, under regulations prescribed by the Secretary of Defense, is dropped from the program 

for deficiency in conduct or studies, or for other reasons, may be 

required to perform active duty in an appropriate military capacity 

in accordance with the active duty obligation imposed by this section. 

(d) The Secretary of a military department, under regulations 

prescribed by the Secretary of Defense, may relieve a member of 

the program who is dropped from the program from an active duty 

obligation imposed by this section, but such relief shall not relieve 

him from any military obligation imposed by any other law. 

(e)(1) A member of the program who is relieved of the member’s active duty obligation under this subchapter before the completion of that active duty obligation may be given, with or without 

the consent of the member, any of the following alternative obligations, as determined by the Secretary of the military department 

concerned: 

(A) A service obligation in another armed force for a period 

of time not less than the member’s remaining active duty service obligation. 

(B) A service obligation in a component of the Selected Reserve for a period not less than twice as long as the member’s 

remaining active duty service obligation. 

(C) Repayment to the Secretary of Defense of a percentage 

of the total cost incurred by the Secretary under this subchapter on behalf of the member pursuant to the repayment 

provisions of section 303a(e) of title 37. 

(2) In addition to the alternative obligations specified in paragraph (1), if the member is relieved of an active duty obligation by 

reason of the separation of the member because of a physical disability, the Secretary of the military department concerned may 

give the member a service obligation as a civilian employee employed as a health care professional in a facility of the uniformed 

services for a period of time equal to the member’s remaining active duty service obligation. 

(3) The Secretary of Defense shall prescribe regulations describing the manner in which an alternative obligation may be 

given under this subsection. 

(Added Pub. L. 92–426, Sec. 2(a), Sept. 21, 1972, 86 Stat. 718; amended Pub. L. 96–513, title 

V, Sec. 511(67), Dec. 12, 1980, 94 Stat. 2926; Pub. L. 100–180, div. A, title VII, Sec. 711(a)(2), 

Dec. 4, 1987, 101 Stat. 1108; Pub. L. 101–597, title IV, Sec. 401(b), Nov. 16, 1990, 104 Stat. 

3035; Pub. L. 104–201, div. A, title VII, Sec. 741(a), Sept. 23, 1996, 110 Stat. 2599; Pub. L. 109– 

163, div. A, title VI, Sec. 687(c)(5), Jan. 6, 2006, 119 Stat. 3334.) 

§ 2124. Members of the program: numbers appointed 

(a) AUTHORIZED NUMBER OF MEMBERS OF THE PROGRAM.—The 

number of persons who may be designated as members of the program for training in each health profession shall be as prescribed 
§ 2125 CH. 105—HEALTH PROFESSIONS FINANCIAL ASSISTANCE PGMS 1012 

by the Secretary of Defense, except that the total number of persons so designated may not, at any time, exceed 6,300. 

(b) MENTAL HEALTH PROFESSIONALS.—Of the number of persons designated as members of the program at any time, 300 may 

be members of the program described in section 2121(a)(1)(B) of 

this title. 

(Added Pub. L. 92–426, Sec. 2(a), Sept. 21, 1972, 86 Stat. 718; amended Pub. L. 99–145, title 

VI, Sec. 672(i), Nov. 8, 1985, 99 Stat. 664; Pub. L. 100–180, div. A, title VII, Sec. 711(a)(2), 

712(b)(1), Dec. 4, 1987, 101 Stat. 1108, 1112; Pub. L. 101–189, div. A, title VII, Sec. 725(g), Nov. 

29, 1989, 103 Stat. 1480; Pub. L. 102–190, div. A, title VII, Sec. 717, Dec. 5, 1991, 105 Stat. 

1404; Pub. L. 111–84, div. A, title V, Sec. 524(b), Oct. 28, 2009, 123 Stat. 2285.) 

§ 2125. Members of the program: exclusion from authorized 

strengths 

Notwithstanding any other provision of law, members of the 

program shall not be counted against any prescribed military 

strengths. 

(Added Pub. L. 92–426, Sec. 2(a), Sept. 21, 1972, 86 Stat. 718.) 

§ 2126. Members of the program: service credit 

(a) SERVICE NOT CREDITABLE.—Except as provided in subsection (b), service performed while a member of the program shall 

not be counted— 

(1) in determining eligibility for retirement other than by 

reason of a physical disability incurred while on active duty as 

a member of the program; or 

(2) in computing years of service creditable under section 

205 of title 37. 

(b) SERVICE CREDITABLE FOR CERTAIN PURPOSES.—(1) The Secretary concerned may authorize service performed by a member of 

the program in pursuit of a course of study under this subchapter 

to be counted in accordance with this subsection if the member— 

(A) completes the course of study; 

(B) completes the active duty obligation imposed under 

section 2123(a) of this title; and 

(C) possesses a specialty designated by the Secretary concerned as critically needed in wartime. 

(2) Service credited under paragraph (1) counts only for the 

award of retirement points for computation of years of service 

under section 12732 of this title and for computation of retired pay 

under section 12733 of this title. 

(3) The number of points credited to a member under paragraph (1) for a year of participation in a course of study is 50. The 

points shall be credited to the member for one of the years of that 

participation at the end of each year after the completion of the 

course of study that the member serves in the Selected Reserve 

and is credited under section 12732(a)(2) of this title with at least 

50 points. The points credited for the participation shall be recorded in the member’s records as having been earned in the year 

of the participation in the course of study. 

(4) Service may not be counted under paragraph (1) for more 

than four years of participation in a course of study as a member 

of the program. 

(5) A member of the Selected Reserve may be considered to be 

in an active status while pursuing a course of study under this sub-
1013 § 2128 CH. 105—HEALTH PROFESSIONS FINANCIAL ASSISTANCE PGMS

chapter only for purposes of sections 12732(a) and 12733(3) of this 

title. 

(6) A member is not entitled to any retroactive award of, or increase in, pay or allowances under title 37 by reason of an award 

of service credit under paragraph (1). 

(Added Pub. L. 92–426, Sec. 2(a), Sept. 21, 1972, 86 Stat. 718; amended Pub. L. 96–513, title 

V, Sec. 501(22), Dec. 12, 1980, 94 Stat. 2908; Pub. L. 104–201, div. A, title V, Sec. 543(a), Sept. 

23, 1996, 110 Stat. 2521; Pub. L. 106–65, div. A, title V, Sec. 544, Oct. 5, 1999, 113 Stat. 608.) 

§ 2127. Scholarships and financial assistance: payments 

(a) The Secretary of Defense may provide for the payment of 

all educational expenses incurred by a member of the program, including tuition, fees, books, and laboratory expenses. Such payments, however, shall be limited to those educational expenses normally incurred by students at the institution and in the health profession concerned who are not members of the program. 

(b) The Secretary of Defense may contract with an accredited 

civilian educational institution for the payment of tuition and other 

educational expenses of members of the program authorized by this 

subchapter. Payment to such institutions may be made without regard to subsections (a) and (b) of section 3324 of title 31. 

(c) Payments made under subsection (b) shall not cover any expenses other than those covered by subsection (a). 

(d) When the Secretary of Defense determines, under regulations prescribed by the Secretary of Health and Human Services, 

that an accredited civilian educational institution has increased its 

total enrollment for the sole purpose of accepting members of the 

program covered by this subchapter, he may provide under a contract with such an institution for additional payments to cover the 

portion of the increased costs of the additional enrollment which 

are not covered by the institution’s normal tuition and fees. 

(e) A person participating as a member of the program in specialized training shall be paid an annual grant in an amount not 

to exceed $45,000 in addition to the stipend under section 2121(d) 

of this title. The maximum amount of the grant shall be increased 

annually by the Secretary of Defense, effective July 1 of each year, 

in the same manner as provided for stipends. 

(Added Pub. L. 92–426, Sec. 2(a), Sept. 21, 1972, 86 Stat. 718; amended Pub. L. 96–513, title 

V, Sec. 511(67), Dec. 12, 1980, 94 Stat. 2926; Pub. L. 97–258, Sec. 3(b)(3), Sept. 13, 1982, 96 

Stat. 1063; Pub. L. 98–525, title XIV, Sec. 1405(56)(A), Oct. 19, 1984, 98 Stat. 2626; Pub. L. 

100–180, div. A, title VII, Sec. 711(a)(2), Dec. 4, 1987, 101 Stat. 1108; Pub. L. 101–189, div. A, 

title VII, Sec. 725(d)(1), (2), Nov. 29, 1989, 103 Stat. 1479; Pub. L. 109–364, div. A, title V, Sec. 

538(b), Oct. 17, 2006, 120 Stat. 2209; Pub. L. 111–84, div. A, title X, Sec. 1073(a)(19), Oct. 28, 

2009, 123 Stat. 2473.) 

§ 2128. Accession bonus for members of the program 

(a) AVAILABILITY OF BONUS.—The Secretary of Defense may 

offer a person who enters into an agreement under section 

2122(a)(2) of this title an accession bonus of not more than $20,000 

as part of the agreement. 

(b) RELATION TO OTHER PAYMENTS.—An accession bonus paid 

a person under this section is in addition to any other amounts 

payable to the person under this subchapter. 

(c) REPAYMENT.—A person who receives an accession bonus 

under this section, but fails to comply with the agreement under 

section 2122(a)(2) of this title or to commence or complete the ac-
§ 2130a CH. 105—HEALTH PROFESSIONS FINANCIAL ASSISTANCE PGMS 1014 

tive duty obligation imposed by section 2123 of this title, shall be 

subject to the repayment provisions of section 303a(e) of title 37. 

(Added Pub. L. 110–181, div. A, title VI, Sec. 623(a), Jan. 28, 2008, 122 Stat. 152.) 

SUBCHAPTER II—NURSE OFFICER CANDIDATE ACCESSION 

PROGRAM 

Sec. 

2130a. Financial assistance: nurse officer candidates. 

§ 2130a. Financial assistance: nurse officer candidates 

(a) BONUS AUTHORIZED.—(1) A person described in subsection 

(b) who, during the period beginning on November 29, 1989, and 

ending on December 31, 2011, executes a written agreement in accordance with subsection (c) to accept an appointment as a nurse 

officer may, upon the acceptance of the agreement by the Secretary 

concerned, be paid an accession bonus of not more than $20,000. 

The bonus shall be paid in periodic installments, as determined by 

the Secretary concerned at the time the agreement is accepted, except that the first installment may not exceed $10,000. 

(2) In addition to the accession bonus payable under paragraph 

(1), a person selected under such paragraph shall be entitled to a 

monthly stipend in an amount not to exceed the stipend rate in effect under section 2121(d) of this title for each month the individual is enrolled as a full-time student in an accredited baccalaureate degree program in nursing at a civilian educational institution by the Secretary selecting the person. The continuation 

bonus may be paid for not more than 24 months. 

(b) ELIGIBLE STUDENTS.—A person eligible to enter into an 

agreement under subsection (a) is a person who— 

(1) is enrolled as a full-time student in an accredited baccalaureate degree program in nursing at a civilian educational 

institution that does not have a Senior Reserve Officers’ Training Corps program established under section 2102 of this title 

by the Secretary selecting the person or that has a Senior Reserve Officers’ Training Corps program for which the student 

is ineligible; 

(2) has completed the second year of an accredited baccalaureate degree program in nursing and has more than 6 

months of academic work remaining before graduation; and 

(3) meets the qualifications for appointment as an officer 

of a reserve component of the Army, Navy, or Air Force as set 

forth in section 12201 of this title or, in the case of the Public 

Health Service, section 207 of the Public Health Service Act 

(42 U.S.C. 209) and the regulations of the Secretary concerned. 

(c) REQUIRED AGREEMENT.—The agreement referred to in subsection (a) shall provide that the person executing the agreement 

agrees to the following: 

(1) That the person will complete the nursing degree program described in subsection (b)(1). 

(2) That, upon acceptance of the agreement by the Secretary concerned, the person will enlist in a reserve component 

of an armed force. 

(3) That the person will accept an appointment as an officer in the Nurse Corps of the Army or the Navy or as an officer 
1015 § 2130a CH. 105—HEALTH PROFESSIONS FINANCIAL ASSISTANCE PGMS

designated as a nurse officer in the Air Force or commissioned 

corps of the Public Health Service, as the case may be, upon 

graduation from the nursing degree program. 

(4) That the person will serve on active duty as such an 

officer— 

(A) for a period of 4 years in the case of a person 

whose agreement was accepted by the Secretary concerned 

during that person’s fourth year of the nursing degree program; or 

(B) for a period of 5 years in the case of a person 

whose agreement was accepted by the Secretary concerned 

during that person’s third year of the nursing degree program. 

(d) REPAYMENT.—A person who does not complete a nursing 

degree program in which the person is enrolled in accordance with 

the agreement entered into under subsection (a), or having completed the nursing degree program, does not become an officer in 

the Nurse Corps of the Army or the Navy or an officer designated 

as a nurse officer of the Air Force or commissioned corps of the 

Public Health Service or does not complete the period of obligated 

active service required under the agreement, shall be subject to the 

repayment provisions of section 303a(e) of title 37. 

(e) REGULATIONS.—The Secretaries concerned shall prescribe 

regulations to carry out this section. 

(Added Pub. L. 101–189, div. A, title VII, Sec. 707(a), Nov. 29, 1989, 103 Stat. 1474; amended 

Pub. L. 101–510, div. A, title VI, Sec. 613(c), title XIV, Sec. 1484(d)(1), Nov. 5, 1990, 104 Stat. 

1577, 1716; Pub. L. 102–190, div. A, title VI, Sec. 612(c)(1), Dec. 5, 1991, 105 Stat. 1376; Pub. 

L. 102–484, div. A, title VI, Sec. 612(h), Oct. 23, 1992, 106 Stat. 2421; Pub. L. 103–160, div. 

A, title VI, Sec. 611(a), Nov. 30, 1993, 107 Stat. 1679; Pub. L. 103–337, div. A, title VI, Sec. 

612(a), Oct. 5, 1994, 108 Stat. 2783; Pub. L. 104–106, div. A, title VI, Sec. 612(a), title XV, Sec. 

1501(c)(23), Feb. 10, 1996, 110 Stat. 359, 499; Pub. L. 104–201, div. A, title VI, Sec. 612(a), Sept. 

23, 1996, 110 Stat. 2543; Pub. L. 105–85, div. A, title VI, Sec. 612(a), Nov. 18, 1997, 111 Stat. 

1786; Pub. L. 105–261, div. A, title VI, Sec. 612(a), Oct. 17, 1998, 112 Stat. 2039; Pub. L. 106– 

65, div. A, title VI, Sec. 612(a), Oct. 5, 1999, 113 Stat. 650; Pub. L. 106–398, Sec. 1 [[div. A], 

title VI, Sec. 622(a)], Oct. 30, 2000, 114 Stat. 1654, 1654A–151; Pub. L. 107–107, div. A, title 

V, Sec. 538, title VI Sec. 612(a), Dec. 28, 2001, 115 Stat. 1107, 1135; Pub. L. 107–314, div. A, 

title VI, Secs. 612(a), 615(h), Dec. 2, 2002, 116 Stat. 2567, 2569; Pub. L. 108–136, div. A, title 

VI, Sec. 612(a), Nov. 24, 2003, 117 Stat. 1501; Pub. L. 108–375, div. A, title VI, Sec. 612(a), 

Oct. 28, 2004, 118 Stat. 1947; Pub. L. 109–163, div. A, title VI, Secs. 622(a), 687(c)(6), Jan. 6, 

2006, 119 Stat. 3294, 3334; Pub. L. 109–364, div. A, title VI, Sec. 612(a), Oct. 17, 2006, 120 

Stat. 2248; Pub. L. 110–181, div. A, title VI, Sec. 612(a), Jan. 28, 2008, 122 Stat. 148; Pub. L. 

110–417, [div. A], title VI, Secs. 612(a), 616(a), (b), Oct. 14, 2008, 122 Stat. 4484, 4486; Pub. 

L. 111–84, div. A, title VI, Sec. 612(a)(1), title X, Sec. 1073(c)(3), Oct. 28, 2009, 123 Stat. 2353, 

2474; Pub. L. 111–383, div. A, title VI, Sec. 612(a)(1), title X, Sec. 1075(b)(28), Jan. 7, 2011, 

124 Stat. 4236, 4370.) 
1016 

CHAPTER 106—EDUCATIONAL ASSISTANCE FOR 

MEMBERS OF THE SELECTED RESERVE 

Sec. 

2131. Reference to chapter 1606. 

[2132 to 2137. Renumbered.] 

2138. Savings provision. 

§ 2131. Reference to chapter 1606 

Provisions of law relating to educational assistance for members of the Selected Reserve under the Montgomery GI Bill program are set forth in chapter 1606 of this title (beginning with section 16131). 

(Added Pub. L. 103–337, div. A, title XVI, Sec. 1663(b)(7), Oct. 5, 1994, 108 Stat. 3007.) 

[Former § 2131 and §§ 2132–2137 renumbered § 16131 through 

§ 16137] 

§ 2138. Savings provision 

A member who entered into an agreement under this chapter 

before July 1, 1985, shall continue to be eligible for educational assistance in accordance with the terms of such agreement and of 

this chapter as in effect before such date. 

(Added Pub. L. 98–525, title VII, Sec. 705(a)(1), Oct. 19, 1984, 98 Stat. 2567.) 
1017 

CHAPTER 106A—EDUCATIONAL ASSISTANCE FOR 

PERSONS ENLISTING FOR ACTIVE DUTY 

Sec. 

2141. Educational assistance program: establishment. 

2142. Educational assistance program: eligibility. 

2143. Educational assistance: amount. 

2144. Subsistence allowance. 

2145. Adjustments of amount of educational assistance and of subsistence allowance. 2146. Right of member upon subsequent reenlistment to lump-sum payment in 

lieu of educational assistance. 

2147. Right of member after reenlisting to transfer entitlement to spouse or dependent children. 

2148. Duration of entitlement. 

2149. Applications for educational assistance. 

§ 2141. Educational assistance program: establishment 

(a) To encourage enlistments and reenlistments for service on 

active duty in the armed forces, the Secretary of each military department may establish a program in accordance with this chapter 

to provide educational assistance to persons enlisting or reenlisting 

in an armed force under his jurisdiction. The costs of any such program shall be borne by the Department of Defense, and a person 

participating in any such program may not be required to make 

any contribution to the program. 

(b) The Secretary of Defense shall prescribe regulations for the 

administration of this chapter. Such regulations shall take account 

of the differences among the several armed forces. 

(c) In this chapter, the term ‘‘enlistment’’ means original enlistment or reenlistment. 

(Added Pub. L. 96–342, title IX, Sec. 901(a), Sept. 8, 1980, 94 Stat. 1111; amended Pub. L. 100– 

180, div. A, title XII, Sec. 1231(18)(A), Dec. 4, 1987, 101 Stat. 1161; Pub. L. 100–456, div. A, 

title XII, Sec. 1233(k)(1), Sept. 29, 1988, 102 Stat. 2058.) 

§ 2142. Educational assistance program: eligibility 

(a)(1) A program of educational assistance established under 

this chapter shall provide that any person enlisting or reenlisting 

in an armed force under the jurisdiction of the Secretary of the 

military department concerned who meets the eligibility requirements established by the Secretary in accordance with subsection 

(b) shall, subject to paragraph (3), become entitled to educational 

assistance under section 2143 of this title at the time of such enlistment. 

(2) The period of educational assistance to which such a person 

becomes entitled is one standard academic year (or the equivalent) 

for each year of the enlistment of such person, up to a maximum 

of four years. However, if the person is discharged or otherwise released from active duty after completing two years of the term of 

such enlistment but before completing the full term of such enlistment (or before completing four years of such term, in the case of 
§ 2143 CH. 106A—EDUCATIONAL ASSISTANCE ACTIVE DUTY 1018 

an enlistment of more than four years), then the period of educational assistance to which the person is entitled is one standard 

academic year (or the equivalent) for each year of active service of 

such person during such term. For the purposes of the preceding 

sentence, a portion of a year of active service shall be rounded to 

the nearest month and shall be prorated to a standard academic 

year. 

(3)(A) A member who is discharged or otherwise released from 

active duty before completing two years of active service of an enlistment which is the basis for entitlement to educational assistance under this chapter or who is discharged or otherwise released 

from active duty under other than honorable conditions is not entitled to educational assistance under this chapter. 

(B) Entitlement to educational assistance under this chapter 

may not be used until a member has completed two years of active 

service of the enlistment which is the basis for entitlement to such 

educational assistance. 

(b) In establishing requirements for eligibility for an educational assistance program under this chapter, the Secretary concerned shall limit eligibility to persons who— 

(1) enlist or reenlist for service on active duty as a member 

of the Army, Navy, Air Force, or Marine Corps after September 

30, 1980, and before October 1, 1981; 

(2) are graduates from a secondary school; and 

(3) meet such other requirements as the Secretary may 

consider appropriate for the purposes of this chapter and the 

needs of the armed forces. 

(Added Pub. L. 96–342, title IX, Sec. 901(a), Sept. 8, 1980, 94 Stat. 1111.) 

§ 2143. Educational assistance: amount 

(a) Subject to subsection (b), an educational assistance program 

established under section 2141 of this title shall provide for payment by the Secretary concerned of educational expenses incurred 

for instruction at an accredited institution by a person entitled to 

such assistance under this chapter. Expenses for which payment 

may be made under this section include tuition, fees, books, laboratory fees, and shop fees for consumable materials used as part of 

classroom or laboratory instruction. Payments under this section 

shall be limited to those educational expenses normally incurred by 

students at the institution involved. 

(b)(1) The Secretary concerned shall establish the amount of 

educational assistance for a standard academic year (or the equivalent) to which a person becomes entitled under this chapter at the 

time of an enlistment described in section 2142 of this title. Depending on the needs of the service, different amounts may be established for different categories of persons or enlistments. The 

amount of educational assistance to which any person is entitled 

shall be adjusted in accordance with section 2145 of this title. 

(2) The amount of educational assistance which may be provided to any person for a standard academic year (or the equivalent) may not exceed $1,200, adjusted in accordance with section 

2145 of this title. 

(c) In this section, the term ‘‘accredited institution’’ means a civilian college or university or a trade, technical, or vocational 
1019 § 2146 CH. 106A—EDUCATIONAL ASSISTANCE ACTIVE DUTY 

school in the United States (including the District of Columbia, the 

Commonwealth of Puerto Rico, Guam, and the Virgin Islands) that 

provides education at the postsecondary level and that is accredited 

by a nationally recognized accrediting agency or association or by 

an accrediting agency or association recognized by the Secretary of 

Education. 

(Added Pub. L. 96–342, title IX, Sec. 901(a), Sept. 8, 1980, 94 Stat. 1112; amended Pub. L. 100– 

180, div. A, title XII, Sec. 1231(18)(A), Dec. 4, 1987, 101 Stat. 1161.) 

§ 2144. Subsistence allowance 

(a) Subject to subsection (b), a person entitled to educational 

assistance under this chapter is entitled to receive a monthly subsistence allowance during any period for which educational assistance is provided such person. The amount of a subsistence allowance under this section is $300 per month, adjusted in accordance 

with section 2145 of this title, in the case of a person pursuing a 

course of instruction on a full-time basis and is one-half of such 

amount (as so adjusted) in the case of a person pursuing a course 

of instruction on less than a full-time basis. 

(b) The number of months for which a subsistence allowance 

may be provided to any person under this section is computed on 

the basis of nine months for each standard academic year of educational assistance to which such person is entitled. 

(c) For purposes of subsection (a), a person shall be considered 

to be pursuing a course of instruction on a full-time basis if the 

person is enrolled in twelve or more semester hours of instruction 

(or the equivalent, as determined by Secretary concerned). 

(Added Pub. L. 96–342, title IX, Sec. 901(a), Sept. 8, 1980, 94 Stat. 1112.) 

§ 2145. Adjustments of amount of educational assistance and 

of subsistence allowance 

(a) Once each year, the Secretary of Defense shall adjust the 

amount of educational assistance which may be provided to any 

person in any standard academic year under section 2143 of this 

title, and the amount of the subsistence allowance authorized 

under section 2144 of this title for pursuit of a course of instruction 

on a full-time basis, in a manner consistent with the change over 

the preceding twelve-month period in the average actual cost of attendance at public institutions of higher education. 

(b) In this section, the term ‘‘actual cost of attendance’’ has the 

meaning given the term ‘‘cost of attendance’’ by section 472 of the 

Higher Education Act of 1965 (20 U.S.C. 1087ll). 

(Added Pub. L. 96–342, title IX, Sec. 901(a), Sept. 8, 1980, 94 Stat. 1113; amended Pub. L. 100– 

180, div. A, title XII, Sec. 1231(18)(A), Dec. 4, 1987, 101 Stat. 1161; Pub. L. 103–35, title II, 

Sec. 201(c)(2), May 31, 1993, 107 Stat. 98.) 

§ 2146. Right of member upon subsequent reenlistment to 

lump-sum payment in lieu of educational assistance 

(a) A member who is entitled to educational assistance under 

this chapter and who reenlists at the end of the enlistment which 

established such entitlement may, at the time of such reenlistment, 

elect to receive a lump-sum payment computed under subsection 
§ 2147 CH. 106A—EDUCATIONAL ASSISTANCE ACTIVE DUTY 1020 

(b) in lieu of receiving such educational assistance. An election to 

receive such a lump-sum payment is irrevocable. 

(b) The amount of a lump-sum payment under subsection (a) 

is 60 percent of the sum of— 

(1) the product of (A) the rate for educational assistance 

under section 2143(b) of this title applicable to such member 

which is in effect at the time of such reenlistment, and (B) the 

number of standard academic years of entitlement of such 

member to such assistance; and 

(2) the product of (A) the rate for the subsistence allowance authorized under section 2144 of this title for pursuit of 

a course of instruction on a full-time basis at the time of such 

reenlistment, and (B) the number of months of entitlement of 

such member to such allowance. 

(Added Pub. L. 96–342, title IX, Sec. 901(a), Sept. 8, 1980, 94 Stat. 1113.) 

§ 2147. Right of member after reenlisting to transfer entitlement to spouse or dependent children 

(a)(1)(A) A person who is entitled to educational assistance 

under section 2142 of this title and who reenlisted in an armed 

force at any time after the end of the enlistment which established 

such entitlement may at any time after such reenlistment elect to 

transfer all or any part of such entitlement to the spouse or dependent child of such person. 

(B) The Secretary of the Navy may authorize a member of the 

Navy or Marine Corps who is entitled to educational assistance 

under section 2142 of this title and whose enlistment that established such entitlement was the member’s second reenlistment as 

a member of the armed forces to transfer all or part of such entitlement to the spouse or dependent child of such member after the 

completion of four years of active service of that second reenlistment if that reenlistment was for a period of at least six years. 

(C) A transfer under this paragraph may be revoked at any 

time by the person making the transfer. 

(2) If a person described in paragraph (1) dies before making 

an election authorized by such paragraph but has never made an 

election not to transfer such entitlement, any unused entitlement 

of such person shall be automatically transferred to such person’s 

surviving spouse or (if there is no eligible surviving spouse) to such 

person’s dependent children. A surviving spouse to whom entitlement to educational assistance is transferred under this paragraph 

may elect to transfer such entitlement to the dependent children of 

the person whose service established such entitlement. 

(3) Any transfer of entitlement under this subsection shall be 

made in accordance with regulations prescribed by the Secretary of 

the military department concerned. 

(b) A spouse or surviving spouse or a dependent child to whom 

entitlement is transferred under subsection (a) is entitled to educational assistance under this chapter in the same manner and at 

the same rate as the person from whom the entitlement was transferred. 

(c) The total amount of educational assistance available to a 

person entitled to educational assistance under section 2142 of this 

title and to the person’s spouse, surviving spouse, and dependent 
1021 § 2149 CH. 106A—EDUCATIONAL ASSISTANCE ACTIVE DUTY 

children is the amount of educational assistance to which the person is entitled. If more than one person is being provided educational assistance for the same period by virtue of the entitlement 

of the same person, the subsistence allowance authorized by section 

2144 of this title shall be divided in such manner as the person 

may specify or (if the person fails to specify) as the Secretary concerned may prescribe. 

(d) In this section: 

(1) The term ‘‘dependent child’’ has the meaning given the 

term ‘‘dependent’’ in section 1072(2)(D) of this title. 

(2) The term ‘‘surviving spouse’’ means a widow or widower who is not remarried. 

(Added Pub. L. 96–342, title IX, Sec. 901(a), Sept. 8, 1980, 94 Stat. 1113; amended Pub. L. 97– 

22, Sec. 10(b)(3), July 10, 1981, 95 Stat. 137; Pub. L. 99–145, title VI, Sec. 673, Nov. 8, 1985, 

99 Stat. 664; Pub. L. 100–180, div. A, title XII, Sec. 1231(17), Dec. 4, 1987, 101 Stat. 1161.) 

§ 2148. Duration of entitlement 

The entitlement of any person to educational assistance under 

this chapter expires at the end of the ten-year period beginning on 

the date of the retirement or discharge or other separation from active duty of the person upon whose service such entitlement is 

based. In the case of a member entitled to educational assistance 

under this chapter who dies while on active duty and whose entitlement is transferred to a spouse or dependent child, such entitlement expires at the end of the ten-year period beginning on the 

date of such member’s death. 

(Added Pub. L. 96–342, title IX, Sec. 901(a), Sept. 8, 1980, 94 Stat. 1114.) 

§ 2149. Applications for educational assistance 

To receive educational assistance benefits under this chapter, 

a person entitled to such assistance under section 2142 or 2147 of 

this title shall submit an application for such assistance to the Secretary concerned in such form and manner as the Secretary concerned may prescribe. 

(Added Pub. L. 96–342, title IX, Sec. 901(a), Sept. 8, 1980, 94 Stat. 1114.) 
1022 

CHAPTER 107—PROFESSIONAL MILITARY EDUCATION 

Sec. 

2151. Definitions. 

2152. Joint professional military education: general requirements. 

2153. Capstone course: newly selected general and flag officers. 

2154. Joint professional military education: three-phase approach. 

2155. Joint professional military education Phase II program of instruction. 

2156. Joint Forces Staff College: duration of principal course of instruction. 

2157. Annual report to Congress. 

§ 2151. Definitions 

(a) JOINT PROFESSIONAL MILITARY EDUCATION.—Joint professional military education consists of the rigorous and thorough instruction and examination of officers of the armed forces in an environment designed to promote a theoretical and practical in-depth 

understanding of joint matters and, specifically, of the subject matter covered. The subject matter to be covered by joint professional 

military education shall include at least the following: 

(1) National Military Strategy. 

(2) Joint planning at all levels of war. 

(3) Joint doctrine. 

(4) Joint command and control. 

(5) Joint force and joint requirements development. 

(b) OTHER DEFINITIONS.—In this chapter: 

(1) The term ‘‘senior level service school’’ means any of the 

following: 

(A) The Army War College. 

(B) The College of Naval Warfare. 

(C) The Air War College. 

(D) The Marine Corps War College. 

(2) The term ‘‘intermediate level service school’’ means any 

of the following: 

(A) The United States Army Command and General 

Staff College. 

(B) The College of Naval Command and Staff. 

(C) The Air Command and Staff College. 

(D) The Marine Corps Command and Staff College. 

(Added Pub. L. 108–375, div. A, title V, Sec. 532(a)(2), Oct. 28, 2004, 118 Stat. 1897.) 

§ 2152. Joint professional military education: general requirements 

(a) IN GENERAL.—The Secretary of Defense shall implement a 

comprehensive framework for the joint professional military education of officers, including officers nominated under section 661 of 

this title for the joint specialty. 

(b) JOINT MILITARY EDUCATION SCHOOLS.—The Secretary of 

Defense, with the advice and assistance of the Chairman of the 

Joint Chiefs of Staff, shall periodically review and revise the cur-
1023 § 2154 CH. 107—PROFESSIONAL MILITARY EDUCATION 

riculum of each school of the National Defense University (and of 

any other joint professional military education school) to enhance 

the education and training of officers in joint matters. The Secretary shall require such schools to maintain rigorous standards for 

the military education of officers with the joint specialty. 

(c) OTHER PROFESSIONAL MILITARY EDUCATION SCHOOLS.—The 

Secretary of Defense shall require that each Department of Defense 

school concerned with professional military education periodically 

review and revise its curriculum for senior and intermediate grade 

officers in order to strengthen the focus on— 

(1) joint matters; and 

(2) preparing officers for joint duty assignments. 

(Added and amended Pub. L. 108–375, div. A, title V, Sec. 532(a)(2), (b), Oct. 28, 2004, 118 Stat. 

1897, 1900.) 

§ 2153. Capstone course: newly selected general and flag 

officers 

(a) REQUIREMENT.—Each officer selected for promotion to the 

grade of brigadier general or, in the case of the Navy, rear admiral 

(lower half) shall be required, after such selection, to attend a military education course designed specifically to prepare new general 

and flag officers to work with the other armed forces. 

(b) WAIVER AUTHORITY.—(1) Subject to paragraph (2), the Secretary of Defense may waive subsection (a)— 

(A) in the case of an officer whose immediately previous 

assignment was in a joint duty assignment and who is thoroughly familiar with joint matters; 

(B) when necessary for the good of the service; 

(C) in the case of an officer whose proposed selection for 

promotion is based primarily upon scientific and technical 

qualifications for which joint requirements do not exist (as determined under regulations prescribed under section 619(e)(4) 

of this title); and 

(D) in the case of a medical officer, dental officer, veterinary officer, medical service officer, nurse, biomedical science 

officer, or chaplain. 

(2) The authority of the Secretary of Defense to grant a waiver 

under paragraph (1) may only be delegated to the Deputy Secretary 

of Defense, an Under Secretary of Defense, or an Assistant Secretary of Defense. Such a waiver may be granted only on a caseby-case basis in the case of an individual officer. 

(Added Pub. L. 108–375, div. A, title V, Sec. 532(a)(2), Oct. 28, 2004, 118 Stat. 1897.) 

§ 2154. Joint professional military education: three-phase 

approach 

(a) THREE-PHASE APPROACH.—The Secretary of Defense shall 

implement a three-phase approach to joint professional military 

education, as follows: 

(1) There shall be a course of instruction, designated and 

certified by the Secretary of Defense with the advice and assistance of the Chairman of the Joint Chiefs of Staff as Phase 

I instruction, consisting of all the elements of a joint professional military education (as specified in section 2151(a) of this 
§ 2155 CH. 107—PROFESSIONAL MILITARY EDUCATION 1024 

title), in addition to the principal curriculum taught to all officers at an intermediate level service school. 

(2) There shall be a course of instruction, designated and 

certified by the Secretary of Defense with the advice and assistance of the Chairman of the Joint Chiefs of Staff as Phase 

II instruction, consisting of a joint professional military education curriculum taught in residence at— 

(A) the Joint Forces Staff College; or 

(B) a senior level service school that has been designated and certified by the Secretary of Defense as a joint 

professional military education institution. 

(3) There shall be a course of instruction, designated and 

certified by the Secretary of Defense with the advice and assistance of the Chairman of the Joint Chiefs of Staff as the 

Capstone course, for officers selected for promotion to the 

grade of brigadier general or, in the case of the Navy, rear admiral (lower half) and offered in accordance with section 2153 

of this title. 

(b) SEQUENCED APPROACH.—The Secretary shall require the sequencing of joint professional military education so that the standard sequence of assignments for such education requires an officer 

to complete Phase I instruction before proceeding to Phase II instruction, as provided in section 2155(a) of this title. 

(Added Pub. L. 108–375, div. A, title V, Sec. 532(a)(2), Oct. 28, 2004, 118 Stat. 1898.) 

§ 2155. Joint professional military education Phase II program of instruction 

(a) PREREQUISITE OF COMPLETION OF JOINT PROFESSIONAL

MILITARY EDUCATION PHASE I PROGRAM OF INSTRUCTION.—(1) 

After September 30, 2009, an officer of the armed forces may not 

be accepted for, or assigned to, a program of instruction designated 

by the Secretary of Defense as joint professional military education 

Phase II unless the officer has successfully completed a program of 

instruction designated by the Secretary of Defense as joint professional military education Phase I. 

(2) The Chairman of the Joint Chiefs of Staff may grant exceptions to the requirement under paragraph (1). Such an exception 

may be granted only on a case-by-case basis under exceptional circumstances, as determined by the Chairman. An officer selected to 

receive such an exception shall have knowledge of joint matters 

and other aspects of the Phase I curriculum that, to the satisfaction of the Chairman, qualifies the officer to meet the minimum requirements established for entry into Phase II instruction without 

first completing Phase I instruction. The number of officers selected 

to attend an offering of the principal course of instruction at the 

Joint Forces Staff College or a senior level service school designated by the Secretary of Defense as a joint professional military 

education institution who have not completed Phase I instruction 

should comprise no more than 10 percent of the total number of officers selected. 

(b) PHASE II REQUIREMENTS.—The Secretary shall require that 

the curriculum for Phase II joint professional military education at 

any school— 
1025 § 2157 CH. 107—PROFESSIONAL MILITARY EDUCATION 

(1) focus on developing joint operational expertise and perspectives and honing joint warfighting skills; and 

(2) be structured— 

(A) so as to adequately prepare students to perform effectively in an assignment to a joint, multiservice organization; and 

(B) so that students progress from a basic knowledge 

of joint matters learned in Phase I instruction to the level 

of expertise necessary for successful performance in the 

joint arena. 

(c) CURRICULUM CONTENT.—In addition to the subjects specified in section 2151(a) of this title, the curriculum for Phase II joint 

professional military education shall include the following: 

(1) National security strategy. 

(2) Theater strategy and campaigning. 

(3) Joint planning processes and systems. 

(4) Joint, interagency, and multinational capabilities and 

the integration of those capabilities. 

(d) STUDENT RATIO; FACULTY RATIO.—Not later than September 30, 2009, for courses of instruction in a Phase II program 

of instruction that is offered at senior level service school that has 

been designated by the Secretary of Defense as a joint professional 

military education institution— 

(1) the percentage of students enrolled in any such course 

who are officers of the armed force that administers the school 

may not exceed 60 percent, with the remaining services proportionally represented; and 

(2) of the faculty at the school who are active-duty officers 

who provide instruction in such courses, the percentage who 

are officers of the armed force that administers the school may 

not exceed 60 percent, with the remaining services proportionally represented. 

(Added Pub. L. 108–375, div. A, title V, Sec. 532(a)(2), Oct. 28, 2004, 118 Stat. 1898; amended 

Pub. L. 109–364, div. A, title X, Sec. 1071(a)(13), (14), Oct. 17, 2006, 120 Stat. 2399.) 

§ 2156. Joint Forces Staff College: duration of principal 

course of instruction 

(a) DURATION.—The duration of the principal course of instruction offered at the Joint Forces Staff College may not be less than 

10 weeks of resident instruction. 

(b) DEFINITION.—In this section, the term ‘‘principal course of 

instruction’’ means any course of instruction offered at the Joint 

Forces Staff College as Phase II joint professional military education. 

(Added Pub. L. 108–375, div. A, title V, Sec. 532(a)(2), Oct. 28, 2004, 118 Stat. 1900.) 

§ 2157. Annual report to Congress 

The Secretary of Defense shall include in the annual report of 

the Secretary to Congress under section 113(c) of this title, for the 

period covered by the report, the following information (which shall 

be shown for the Department of Defense as a whole and separately 

for the Army, Navy, Air Force, and Marine Corps and each reserve 

component): 
§ 2157 CH. 107—PROFESSIONAL MILITARY EDUCATION 1026 

(1) The number of officers who successfully completed a 

joint professional military education Phase II course and were 

not selected for promotion. 

(2) The number of officer students and faculty members assigned by each service to the professional military schools of 

the other services and to the joint schools. 

(Added Pub. L. 108–375, div. A, title V, Sec. 532(a)(2), Oct. 28, 2004, 118 Stat. 1900; amended 

Pub. L. 109–364, div. A, title X, Sec. 1071(a)(15), Oct. 17, 2006, 120 Stat. 2399.) 
1027 

CHAPTER 108—DEPARTMENT OF DEFENSE SCHOOLS 

Sec. 

2161. Degree granting authority for National Defense Intelligence College. 

2162. Preparation of budget requests for operation of professional military education schools. 

2163. Degree granting authority for National Defense University. 

2164. Department of Defense domestic dependent elementary and secondary 

schools. 

2165. National Defense University: component institutions. 

2166. Western Hemisphere Institute for Security Cooperation. 

2167. National Defense University: admission of private sector civilians to professional military education program. 

2167a. Defense Cyber Investigations Training Academy: admission of private sector civilians to receive instruction. 

2168. Defense Language Institute Foreign Language Center: degree of Associate 

of Arts in foreign language. 

2169. School of Nursing: establishment. 

§ 2161. Degree granting authority for National Defense Intelligence College 

(a) AUTHORITY.—Under regulations prescribed by the Secretary 

of Defense, the President of the National Defense Intelligence College may, upon the recommendation of the faculty of the National 

Defense Intelligence College, confer appropriate degrees upon graduates who meet the degree requirements. 

(b) LIMITATION.—A degree may not be conferred under this section unless— 

(1) the Secretary of Education has recommended approval 

of the degree in accordance with the Federal Policy Governing 

Granting of Academic Degrees by Federal Agencies; and 

(2) the National Defense Intelligence College is accredited 

by the appropriate civilian academic accrediting agency or organization to award the degree, as determined by the Secretary of Education. 

(c) CONGRESSIONAL NOTIFICATION REQUIREMENTS.—(1) When 

seeking to establish degree granting authority under this section, 

the Secretary of Defense shall submit to the Committees on Armed 

Services of the Senate and House of Representatives— 

(A) a copy of the self assessment questionnaire required by 

the Federal Policy Governing Granting of Academic Degrees by 

Federal Agencies, at the time the assessment is submitted to 

the Department of Education’s National Advisory Committee 

on Institutional Quality and Integrity; and 

(B) the subsequent recommendations and rationale of the 

Secretary of Education regarding the establishment of the degree granting authority. 

(2) Upon any modification or redesignation of existing degree 

granting authority, the Secretary of Defense shall submit to the 

Committees on Armed Services of the Senate and House of Representatives a report containing the rationale for the proposed 
§ 2162 CH. 108—DEPARTMENT OF DEFENSE SCHOOLS 1028 

modification or redesignation and any subsequent recommendation 

of the Secretary of Education on the proposed modification or redesignation. 

(3) The Secretary of Defense shall submit to the Committees 

on Armed Services of the Senate and House of Representatives a 

report containing an explanation of any action by the appropriate 

academic accrediting agency or organization not to accredit the National Defense Intelligence College to award any new or existing 

degree. 

(Added Pub. L. 96–450, title IV, Sec. 406(a), Oct. 14, 1980, 94 Stat. 1980; amended Pub. L. 105– 

107, title V, Sec. 501(a), Nov. 20, 1997, 111 Stat. 2261; Pub. L. 110–417, [div. A], title V, Sec. 

543(a)(1), Oct. 14, 2008, 122 Stat. 4456.) 

§ 2162. Preparation of budget requests for operation of professional military education schools 

(a) UNIFORM COST ACCOUNTING.—The Secretary of Defense, 

with the advice and assistance of the Chairman of the Joint Chiefs 

of Staff, shall promulgate a uniform cost accounting system for use 

by the Secretaries of the military departments in preparing budget 

requests for the operation of professional military education 

schools. 

(b) PREPARATION OF BUDGET REQUESTS.—(1) Amounts requested for a fiscal year for the operation of each professional military education school shall be set forth as a separate budget request in the materials submitted by the Secretary of Defense to 

Congress in support of the budget request for the Department of 

Defense. 

(2) As executive agent for funding professional development 

education at the National Defense University, including the Joint 

Forces Staff College, the Secretary of Defense, with the advice of 

the Chairman of the Joint Chiefs of Staff, shall prepare the annual 

budget for professional development education operations at the 

National Defense University and set forth that request as a separate budget request in the materials submitted to Congress in support of the budget request for the Department of Defense. Nothing 

in the preceding sentence affects policies in effect on December 28, 

2001, with respect to budgeting for the funding of logistical and 

base operations support for components of the National Defense 

University through the military departments. 

(3) The Secretary of a military department preparing a budget 

request for a professional military education school shall carefully 

consider the views of the Chairman of the Joint Chiefs of Staff, 

particularly with respect to the amount of the request for the operation of the schools of the National Defense University and the 

joint professional military education curricula of the other professional military education schools. 

(c) COMPARISON OF BUDGET REQUESTS.—Materials prepared in 

support of the budget request for a professional military education 

school shall describe whether the amount requested for that school 

is comparable to the amounts requested for other professional military education schools, taking into consideration the size and activities of the schools. 
1029 § 2163 CH. 108—DEPARTMENT OF DEFENSE SCHOOLS 

(d) PROFESSIONAL MILITARY EDUCATION SCHOOLS.—This section applies to each of the following professional military education 

schools: 

(1) The National Defense University. 

(2) The Army War College. 

(3) The College of Naval Warfare. 

(4) The Air War College. 

(5) The United States Army Command and General Staff 

College. 

(6) The College of Naval Command and Staff. 

(7) The Air Command and Staff College. 

(8) The Marine Corps University. 

(Added Pub. L. 101–510, div. A, title IX, Sec. 911(a), Nov. 5, 1990, 104 Stat. 1625; amended 

Pub. L. 105–85, div. A, title IX, Sec. 921(b), Nov. 18, 1997, 111 Stat. 1862; Pub. L. 107–107, 

div. A, title V, Sec. 527(b), Dec. 28, 2001, 115 Stat. 1102; Pub. L. 107–314, div. A, title X, Sec. 

1062(a)(7), Dec. 2, 2002, 116 Stat. 2650.) 

§ 2163. Degree granting authority for National Defense University 

(a) AUTHORITY.—Under regulations prescribed by the Secretary 

of Defense, the President of the National Defense University may, 

upon the recommendation of the faculty of the National Defense 

University, confer appropriate degrees upon graduates who meet 

the degree requirements. 

(b) LIMITATION.—A degree may not be conferred under this section unless— 

(1) the Secretary of Education has recommended approval 

of the degree in accordance with the Federal Policy Governing 

Granting of Academic Degrees by Federal Agencies; and 

(2) the National Defense University is accredited by the 

appropriate civilian academic accrediting agency or organization to award the degree, as determined by the Secretary of 

Education. 

(c) CONGRESSIONAL NOTIFICATION REQUIREMENTS.—(1) When 

seeking to establish degree granting authority under this section, 

the Secretary of Defense shall submit to the Committees on Armed 

Services of the Senate and House of Representatives— 

(A) a copy of the self assessment questionnaire required by 

the Federal Policy Governing Granting of Academic Degrees by 

Federal Agencies, at the time the assessment is submitted to 

the Department of Education’s National Advisory Committee 

on Institutional Quality and Integrity; and 

(B) the subsequent recommendations and rationale of the 

Secretary of Education regarding the establishment of the degree granting authority. 

(2) Upon any modification or redesignation of existing degree 

granting authority, the Secretary of Defense shall submit to the 

Committees on Armed Services of the Senate and House of Representatives a report containing the rationale for the proposed 

modification or redesignation and any subsequent recommendation 

of the Secretary of Education on the proposed modification or redesignation. 

(3) The Secretary of Defense shall submit to the Committees 

on Armed Services of the Senate and House of Representatives a 

report containing an explanation of any action by the appropriate 
§ 2164 CH. 108—DEPARTMENT OF DEFENSE SCHOOLS 1030 

academic accrediting agency or organization not to accredit the National Defense University to award any new or existing degree. 

(Added Pub. L. 103–160, div. A, title IX, Sec. 922(a), Nov. 30, 1993, 107 Stat. 1730; amended 

Pub. L. 109–163, div. A, title V, Sec. 521(a), Jan. 6, 2006, 119 Stat. 3239; Pub. L. 110–181, div. 

A, title V, Sec. 526(a), (b)(1), Jan. 28, 2008, 122 Stat. 104, 105; Pub. L. 110–417, [div. A], title 

V, Sec. 543(b)(1), Oct. 14, 2008, 122 Stat. 4457.) 

§ 2164. Department of Defense domestic dependent elementary and secondary schools 

(a) AUTHORITY OF SECRETARY.—(1) If the Secretary of Defense 

makes a determination that appropriate educational programs are 

not available through a local educational agency for dependents of 

members of the armed forces and dependents of civilian employees 

of the Federal Government residing on a military installation in 

the United States (including territories, commonwealths, and possessions of the United States), the Secretary may enter into arrangements to provide for the elementary or secondary education 

of the dependents of such members of the armed forces and, to the 

extent authorized in subsection (c), the dependents of such civilian 

employees. 

(2) The Secretary may, at the discretion of the Secretary, permit dependents of members of the armed forces and, to the extent 

provided in subsection (c), dependents of civilian employees of the 

Federal Government residing in a territory, commonwealth, or possession of the United States but not on a military installation, to 

enroll in an educational program provided by the Secretary pursuant to this subsection. If a member of the armed forces is assigned 

to a remote location or is assigned to an unaccompanied tour of 

duty, a dependent of the member who resides, on or off a military 

installation, in a territory, commonwealth, or possession of the 

United States, as authorized by the member’s orders, may be enrolled in an educational program provided by the Secretary under 

this subsection. 

(3)(A) Under the circumstances described in subparagraph (B), 

the Secretary may, at the discretion of the Secretary, permit a dependent of a member of the armed forces to enroll in an educational program provided by the Secretary pursuant to this subsection without regard to the requirement in paragraph (1) with respect to residence on a military installation. 

(B) Subparagraph (A) applies only if— 

(i) the dependents reside in temporary housing (regardless 

of whether the temporary housing is on Federal property)— 

(I) because of the unavailability of adequate permanent living quarters on the military installation to which 

the member is assigned; or 

(II) while the member is wounded, ill, or injured; and 

(ii) the Secretary determines that the circumstances of 

such living arrangements justify extending the enrollment authority to include the dependents. 

(b) FACTORS FOR SECRETARY TO CONSIDER.—(1) Factors to be 

considered by the Secretary of Defense in making a determination 

under subsection (a) shall include the following: 

(A) The extent to which such dependents are eligible for 

free public education in the local area adjacent to the military 

installation. 
1031 § 2164 CH. 108—DEPARTMENT OF DEFENSE SCHOOLS 

(B) The extent to which the local educational agency is 

able to provide an appropriate educational program for such 

dependents. 

(2) For purposes of paragraph (1)(B), an appropriate educational program is a program that, as determined by the Secretary, is comparable to a program of free public education provided for children by the following local educational agencies: 

(A) In the case of a military installation located in a State 

(other than an installation referred to in subparagraph (B)), 

local educational agencies in the State that are similar to the 

local educational agency referred to in paragraph (1)(B). 

(B) In the case of a military installation with boundaries 

contiguous to two or more States, local educational agencies in 

the contiguous States that are similar to the local educational 

agency referred to in paragraph (1)(B). 

(C) In the case of a military installation located in a territory, commonwealth, or possession, the District of Columbia 

public schools, except that an educational program determined 

comparable under this subparagraph may be considered appropriate for the purposes of paragraph (1)(B) only if the program 

is conducted in the English language. 

(c) ELIGIBILITY OF DEPENDENTS OF FEDERAL EMPLOYEES.— (1)(A) A dependent of a Federal employee residing in permanent 

living quarters on a military installation at any time during the 

school year may enroll in an educational program provided by the 

Secretary of Defense pursuant to subsection (a) for dependents residing on such installation. 

(B) A dependent of a United States Customs Service employee 

who resides in Puerto Rico, but not on a military installation, may 

enroll in an educational program provided by the Secretary pursuant to subsection (a) in Puerto Rico in accordance with the same 

rules as apply to a dependent of a Federal employee residing in 

permanent living quarters on a military installation. 

(2)(A) Except as provided in subparagraphs (B) and (C), a dependent of a Federal employee who is enrolled in an educational 

program provided by the Secretary pursuant to subsection (a) and 

who is not residing on a military installation may be enrolled in 

the program for not more than five consecutive school years. 

(B) At the discretion of the Secretary, a dependent referred to 

in subparagraph (A) may be enrolled in the program for more than 

five consecutive school years if the dependent is otherwise qualified 

for enrollment, space is available in the program, and the Secretary 

will be reimbursed for the educational services provided. Any such 

extension shall cover only one school year at a time. 

(C) Subparagraph (A) shall not apply to an individual who is 

a dependent of a Federal employee in the excepted service (as defined in section 2103 of title 5) and who is enrolled in an educational program provided by the Secretary pursuant to subsection 

(a) in Puerto Rico, Wake Island, Guam, American Samoa, the 

Northern Mariana Islands, or the Virgin Islands. 

(D) Subparagraph (A) shall not apply to a dependent covered 

by paragraph (1)(B). No requirement under this paragraph for reimbursement for educational services provided for the dependent 

shall apply with respect to the dependent, except that the Sec-
§ 2164 CH. 108—DEPARTMENT OF DEFENSE SCHOOLS 1032 

retary may require the United States Customs Service to reimburse the Secretary for the cost of the educational services provided 

for the dependent. 

(d) SCHOOL BOARDS.—(1) The Secretary of Defense shall provide for the establishment of a school board for Department of Defense elementary and secondary schools established at each military installation under this section. The Secretary may provide for 

the establishment of one school board for all such schools in the 

Commonwealth of Puerto Rico and one school board for all such 

schools in Guam instead of one school board for each military installation in those locations. 

(2) The school board shall be composed of the number of members, not fewer than three, prescribed by the Secretary. 

(3) The parents of the students attending the school shall elect 

the school board in accordance with procedures which the Secretary 

shall prescribe. 

(4)(A) A school board elected for a school under this subsection 

may participate in the development and oversight of fiscal, personnel, and educational policies, procedures, and programs for the 

school, except that the Secretary may issue any directive that the 

Secretary considers necessary for the effective operation of the 

school or the entire school system. 

(B) A directive referred to in subparagraph (A) shall, to the 

maximum extent practicable, be issued only after the Secretary 

consults with the appropriate school boards elected under this subsection. The Secretary shall establish a process by which a school 

board or school administrative officials may formally appeal the directive to the Secretary of Defense. 

(5) Meetings conducted by the school board shall be open to the 

public, except as provided in paragraph (6). 

(6) A school board need not comply with the provisions of the 

Federal Advisory Committee Act (5 U.S.C. App.), but may close 

meetings in accordance with such Act. 

(7) The Secretary may provide for reimbursement of a school 

board member for expenses incurred by the member for travel, 

transportation, lodging, meals, program fees, activity fees, and 

other appropriate expenses that the Secretary determines are reasonable and necessary for the performance of school board duties 

by the member. 

(e) ADMINISTRATION AND STAFF.—(1) The Secretary of Defense 

may enter into such arrangements as may be necessary to provide 

educational programs at the school. 

(2) The Secretary may, without regard to the provisions of any 

other law relating to the number, classification, or compensation of 

employees— 

(A) establish positions for civilian employees in schools established under this section; 

(B) appoint individuals to such positions; and 

(C) fix the compensation of such individuals for service in 

such positions. 

(3)(A) Except as provided in subparagraph (B), in fixing the 

compensation of employees appointed for a school pursuant to paragraph (2), the Secretary shall consider— 
1033 § 2164 CH. 108—DEPARTMENT OF DEFENSE SCHOOLS 

(i) the compensation of comparable employees of the local 

educational agency in the capital of the State where the military installation is located; 

(ii) the compensation of comparable employees in the local 

educational agency that provides public education to students 

who reside adjacent to the military installation; and 

(iii) the average compensation for similar positions in not 

more than three other local educational agencies in the State 

in which the military installation is located. 

(B) In fixing the compensation of employees in schools established in the territories, commonwealths, and possessions pursuant 

to the authority of this section, the Secretary shall determine the 

level of compensation required to attract qualified employees. For 

employees in such schools, the Secretary, without regard to the 

provisions of title 5, may provide for the tenure, leave, hours of 

work, and other incidents of employment to be similar to that provided for comparable positions in the public schools of the District 

of Columbia. For purposes of the first sentence, a school established before the effective date of this section pursuant to authority 

similar to the authority in this section shall be considered to have 

been established pursuant to the authority of this section. 

(4)(A) The Secretary may, without regard to the provisions of 

any law relating to the number, classification, or compensation of 

employees— 

(i) transfer employees from schools established under this 

section to schools in the defense dependents’ education system 

in order to provide the services referred to in subparagraph (B) 

to such system; and 

(ii) transfer employees from such system to schools established under this section in order to provide such services to 

those schools. 

(B) The services referred to in subparagraph (A) are the following: 

(i) Administrative services. 

(ii) Logistical services. 

(iii) Personnel services. 

(iv) Such other services as the Secretary considers appropriate. 

(C) Transfers under this paragraph shall extend for such periods as the Secretary considers appropriate. The Secretary shall 

provide appropriate compensation for employees so transferred. 

(D) The Secretary may provide that the transfer of an employee under this paragraph occur without reimbursement of the 

school or system concerned. 

(E) In this paragraph, the term ‘‘defense dependents’ education 

system’’ means the program established and operated under section 

1402(a) of the Defense Dependents’ Education Act of 1978 (20 

U.S.C. 921(a)). 

(f) SUBSTANTIVE AND PROCEDURAL RIGHTS AND PROTECTIONS

FOR CHILDREN.—(1) The Secretary shall provide the following substantive rights, protections, and procedural safeguards (including 

due process procedures) in the educational programs provided for 

under this section: 
§ 2164 CH. 108—DEPARTMENT OF DEFENSE SCHOOLS 1034 

(A) In the case of children with disabilities aged 3 to 5, inclusive, all substantive rights, protections, and procedural safeguards (including due process procedures) available to children 

with disabilities aged 3 to 5, inclusive, under part B of the Individuals with Disabilities Education Act (20 U.S.C. 1411 et 

seq.). 

(B) In the case of infants or toddlers with disabilities, all 

substantive rights, protections, and procedural safeguards (including due process procedures) available to infants or toddlers 

with disabilities under part C of such Act (20 U.S.C. 1431 et 

seq.). 

(C) In the case of all other children with disabilities, all 

substantive rights, protections, and procedural safeguards (including due process procedures) available to children with disabilities who are 3 to 5 years old under part B of such Act. 

(2) Paragraph (1) may not be construed as diminishing for children with disabilities enrolled in day educational programs provided for under this section the extent of substantive rights, protections, and procedural safeguards that were available under section 

6(a) of Public Law 81–874 (20 U.S.C. 241(a)) to children with disabilities as of October 7, 1991. 

(3) In this subsection: 

(A) The term ‘‘children with disabilities’’ has the meaning 

given the term in section 602 of the Individuals with Disabilities Education Act (20 U.S.C. 1401). 

(B) The term ‘‘infants or toddlers with disabilities’’ has the 

meaning given the term in section 632 of such Act (20 U.S.C. 

1432). 

(g) REIMBURSEMENT.—When the Secretary of Defense provides 

educational services under this section to an individual who is a 

dependent of an employee of a Federal agency outside the Department of Defense, the head of the other Federal agency shall, upon 

request of the Secretary of Defense, reimburse the Secretary for 

those services at rates routinely prescribed by the Secretary for 

those services. Any payments received by the Secretary under this 

subsection shall be credited to the account designated by the Secretary for the operation of educational programs under this section. 

(h) CONTINUATION OF ENROLLMENT DESPITE CHANGE IN STATUS.—(1) The Secretary of Defense shall permit a dependent of a 

member of the armed forces or a dependent of a Federal employee 

to continue enrollment in an educational program provided by the 

Secretary pursuant to subsection (a) for the remainder of a school 

year notwithstanding a change during such school year in the status of the member or Federal employee that, except for this paragraph, would otherwise terminate the eligibility of the dependent 

to be enrolled in the program. 

(2) The Secretary may, for good cause, authorize a dependent 

of a member of the armed forces or a dependent of a Federal employee to continue enrollment in an educational program provided 

by the Secretary pursuant to subsection (a) notwithstanding a 

change in the status of the member or employee that, except for 

this paragraph, would otherwise terminate the eligibility of the dependent to be enrolled in the program. The enrollment may continue for as long as the Secretary considers appropriate. 
1035 § 2165 CH. 108—DEPARTMENT OF DEFENSE SCHOOLS 

(3) Paragraphs (1) and (2) do not limit the authority of the Secretary to remove a dependent from enrollment in an educational 

program provided by the Secretary pursuant to subsection (a) at 

any time for good cause determined by the Secretary. 

(i) AMERICAN RED CROSS EMPLOYEE DEPENDENTS IN PUERTO

RICO.—(1) The Secretary may authorize the dependent of an American Red Cross employee described in paragraph (2) to enroll in an 

education program provided by the Secretary pursuant to subsection (a) in Puerto Rico if the American Red Cross agrees to reimburse the Secretary for the educational services so provided. 

(2) An employee referred to in paragraph (1) is an American 

Red Cross employee who— 

(A) resides in Puerto Rico; and 

(B) performs, on a full-time basis, emergency services on 

behalf of members of the armed forces. 

(3) In determining the dependency status of any person for the 

purposes of paragraph (1), the Secretary shall apply the same definitions as apply to the determination of such status with respect 

to Federal employees in the administration of this section. 

(4) Subsection (g) shall apply with respect to determining the 

reimbursement rates for educational services provided pursuant to 

this subsection. Amounts received as reimbursement for such educational services shall be treated in the same manner as amounts 

received under subsection (g). 

(j) TUITION-FREE ENROLLMENT OF DEPENDENTS OF FOREIGN

MILITARY PERSONNEL RESIDING ON DOMESTIC MILITARY INSTALLATIONS AND DEPENDENTS OF CERTAIN DECEASED MEMBERS OF THE

ARMED FORCES.—(1) The Secretary may authorize the enrollment 

in a Department of Defense education program provided by the 

Secretary pursuant to subsection (a) of a dependent not otherwise 

eligible for such enrollment who is the dependent of an individual 

described in paragraph (2). Enrollment of such a dependent shall 

be on a tuition-free basis. 

(2) An individual referred to in paragraph (1) is any of the following: 

(A) A member of a foreign armed force residing on a military installation in the United States (including territories, 

commonwealths, and possessions of the United States). 

(B) A deceased member of the armed forces who died in 

the line of duty in a combat-related operation, as designated by 

the Secretary. 

(Added Pub. L. 103–337, div. A, title III, Sec. 351(a), Oct. 5, 1994, 108 Stat. 2727; amended Pub. 

L. 104–106, div. A, title X, Sec. 1075, Feb. 10, 1996, 110 Stat. 450; Pub. L. 104–201, div. A, 

title XVI, Sec. 1608, Sept. 23, 1996, 110 Stat. 2737; Pub. L. 105–261, div. A, title III, Sec. 

371(a)–(c)(2), Oct. 17, 1998, 112 Stat. 1988, 1989; Pub. L. 106–65, div. A, title III, Sec. 352, 353, 

Oct. 5, 1999, 113 Stat. 572; Pub. L. 106–398, Sec. 1 [[div. A), title III, Sec. 361], Oct. 30, 2000, 

114 Stat. 1654, 1654A–76; Pub. L. 108–446, title III, Sec. 305(a), Dec. 3, 2004, 118 Stat. 2804; 

Pub. L. 111–84, div. A, title V, Sec. 534, Oct. 28, 2009, 123 Stat. 2292; Pub. L. 111–383, div. 

A, title V, Sec. 561, Jan. 7, 2011, 124 Stat. 4221.) 

§ 2165. National Defense University: component institutions 

(a) IN GENERAL.—There is a National Defense University in 

the Department of Defense. 

(b) COMPONENT INSTITUTIONS.—The National Defense University consists of the following institutions: 

(1) The National War College. 
§ 2166 CH. 108—DEPARTMENT OF DEFENSE SCHOOLS 1036 

(2) The Industrial College of the Armed Forces. 

(3) The Joint Forces Staff College. 

(4) The Institute for National Strategic Studies. 

(5) The Information Resources Management College. 

(6) Any other educational institution of the Department of 

Defense that the Secretary considers appropriate and designates as an institution of the university. 

[(c) Repealed. Pub. L. 109–364, div. A, title IX, Sec. 

904(b)(2)(B), Oct. 17, 2006, 120 Stat. 2353] 

(d) SOURCE OF FUNDS FOR PROFESSIONAL DEVELOPMENT EDUCATION OPERATIONS.—Funding for the professional development 

education operations of the National Defense University shall be 

provided from funds made available to the Secretary of Defense 

from the annual appropriation ‘‘Operation and Maintenance, Defense-wide’’. 

(e) ACCEPTANCE OF FACULTY RESEARCH GRANTS.—(1) The Secretary of Defense may authorize the President of the National Defense University to accept qualifying research grants. Any such 

grant may only be accepted if the work under the grant is to be 

carried out by a professor or instructor of one of the institutions 

comprising the University for a scientific, literary, or educational 

purpose. 

(2) A qualifying research grant under this subsection is a grant 

that is awarded on a competitive basis by an entity referred to in 

paragraph (3) for a research project with a scientific, literary, or 

educational purpose. 

(3) A grant may be accepted under this subsection only from 

a corporation, fund, foundation, educational institution, or similar 

entity that is organized and operated primarily for scientific, literary, or educational purposes. 

(4) The Secretary shall establish an account for administering 

funds received as research grants under this subsection. The President of the University shall use the funds in the account in accordance with applicable provisions of the regulations and the terms 

and condition of the grants received. 

(5) Subject to such limitations as may be provided in appropriations Acts, appropriations available for the National Defense 

University may be used to pay expenses incurred by the University 

in applying for, and otherwise pursuing, the award of qualifying research grants. 

(6) The Secretary shall prescribe regulations for the administration of this subsection. 

(Added and amended Pub. L. 105–85, div. A, title IX, Secs. 921(a)(1), 922(a), Nov. 18, 1997, 111 

Stat. 1862, 1865; Pub. L. 105–261, div. A, title IX, Secs. 904, 905(a), Oct. 17, 1998, 112 Stat. 

2093; Pub. L. 106–398, Sec. 1 [[div. A], title IX, Sec. 913(b)], Oct. 30, 2000, 114 Stat. 1654, 

1654A–230; Pub. L. 107–107, div. A, title V, Sec. 527(c)(1), Dec. 28, 2001, 115 Stat. 1102; Pub. 

L. 109–163, div. A, title V, Sec. 522(a), Jan. 6, 2006, 119 Stat. 3240; Pub. L. 109–364, div. A, 

title IX, Sec. 904(b)(2), Oct. 17, 2006, 120 Stat. 2353.) 

§ 2166. Western Hemisphere Institute for Security Cooperation 

(a) ESTABLISHMENT AND ADMINISTRATION.—(1) The Secretary 

of Defense may operate an education and training facility for the 

purpose set forth in subsection (b). The facility shall be known as 

the ‘‘Western Hemisphere Institute for Security Cooperation’’. 
1037 § 2166 CH. 108—DEPARTMENT OF DEFENSE SCHOOLS 

(2) The Secretary may designate the Secretary of a military department as the Department of Defense executive agent for carrying out the responsibilities of the Secretary of Defense under this 

section. 

(b) PURPOSE.—The purpose of the Institute is to provide professional education and training to eligible personnel of nations of the 

Western Hemisphere within the context of the democratic principles set forth in the Charter of the Organization of American 

States (such charter being a treaty to which the United States is 

a party), while fostering mutual knowledge, transparency, confidence, and cooperation among the participating nations and promoting democratic values, respect for human rights, and knowledge 

and understanding of United States customs and traditions. 

(c) ELIGIBLE PERSONNEL.—(1) Subject to paragraph (2), personnel of nations of the Western Hemisphere are eligible for education and training at the Institute as follows: 

(A) Military personnel. 

(B) Law enforcement personnel. 

(C) Civilian personnel. 

(2) The Secretary of State shall be consulted in the selection 

of foreign personnel for education or training at the Institute. 

(d) CURRICULUM.—(1) The curriculum of the Institute shall include mandatory instruction for each student, for at least 8 hours, 

on human rights, the rule of law, due process, civilian control of 

the military, and the role of the military in a democratic society. 

(2) The curriculum may include instruction and other educational and training activities on the following: 

(A) Leadership development. 

(B) Counterdrug operations. 

(C) Peace support operations. 

(D) Disaster relief. 

(E) Any other matter that the Secretary determines appropriate. 

(e) BOARD OF VISITORS.—(1) There shall be a Board of Visitors 

for the Institute. The Board shall be composed of the following: 

(A) The chairman and ranking minority member of the 

Committee on Armed Services of the Senate, or a designee of 

either of them. 

(B) The chairman and ranking minority member of the 

Committee on Armed Services of the House of Representatives, 

or a designee of either of them. 

(C) Six persons designated by the Secretary of Defense including, to the extent practicable, persons from academia and 

the religious and human rights communities. 

(D) One person designated by the Secretary of State. 

(E) The senior military officer responsible for training and 

doctrine for the Army or, if the Secretary of the Navy or the 

Secretary of the Air Force is designated as the executive agent 

of the Secretary of Defense under subsection (a)(2), the senior 

military officer responsible for training and doctrine for the 

Navy or Marine Corps or for the Air Force, respectively, or a 

designee of the senior military officer concerned. 
§ 2166 CH. 108—DEPARTMENT OF DEFENSE SCHOOLS 1038 

(F) The commanders of the combatant commands having 

geographic responsibility for the Western Hemisphere, or the 

designees of those officers. 

(2) A vacancy in a position on the Board shall be filled in the 

same manner as the position was originally filled. 

(3) The Board shall meet at least once each year. 

(4)(A) The Board shall inquire into the curriculum, instruction, 

physical equipment, fiscal affairs, and academic methods of the Institute, other matters relating to the Institute that the Board decides to consider, and any other matter that the Secretary of Defense determines appropriate. 

(B) The Board shall review the curriculum of the Institute to 

determine whether— 

(i) the curriculum complies with applicable United States 

laws and regulations; 

(ii) the curriculum is consistent with United States policy 

goals toward Latin America and the Caribbean; 

(iii) the curriculum adheres to current United States doctrine; and 

(iv) the instruction under the curriculum appropriately emphasizes the matters specified in subsection (d)(1). 

(5) Not later than 60 days after its annual meeting, the Board 

shall submit to the Secretary of Defense a written report of its activities and of its views and recommendations pertaining to the Institute. 

(6) Members of the Board shall not be compensated by reason 

of service on the Board. 

(7) With the approval of the Secretary of Defense, the Board 

may accept and use the services of voluntary and uncompensated 

advisers appropriate to the duties of the Board without regard to 

section 1342 of title 31. 

(8) Members of the Board and advisers whose services are accepted under paragraph (7) shall be allowed travel and transportation expenses, including per diem in lieu of subsistence, while 

away from their homes or regular places of business in the performance of services for the Board. Allowances under this paragraph shall be computed— 

(A) in the case of members of the Board who are officers 

or employees of the United States, at rates authorized for employees of agencies under subchapter I of chapter 57 of title 5; 

and 

(B) in the case of other members of the Board and advisers, as authorized under section 5703 of title 5 for employees 

serving without pay. 

(9) The Federal Advisory Committee Act (5 U.S.C. App.), other 

than section 14 (relating to termination after two years), shall 

apply to the Board. 

(f) AUTHORITY TO ACCEPT FOREIGN GIFTS AND DONATIONS.—(1) 

The Secretary of Defense may, on behalf of the Institute, accept 

foreign gifts or donations in order to defray the costs of, or enhance 

the operation of, the Institute. 

(2) Funds received by the Secretary under paragraph (1) shall 

be credited to appropriations available for the Department of Defense for the Institute. Funds so credited shall be merged with the 
1039 § 2167 CH. 108—DEPARTMENT OF DEFENSE SCHOOLS 

appropriations to which credited and shall be available for the Institute for the same purposes and same period as the appropriations with which merged. 

(3) The Secretary of Defense shall notify Congress if the total amount of money accepted under paragraph (1) exceeds $1,000,000 

in any fiscal year. Any such notice shall list each of the contributors of such money and the amount of each contribution in such fiscal year. 

(4) For the purposes of this subsection, a foreign gift or donation is a gift or donation of funds, materials (including research 

materials), property, or services (including lecture services and faculty services) from a foreign government, a foundation or other 

charitable organization in a foreign country, or an individual in a 

foreign country. 

(g) FIXED COSTS.—The fixed costs of operating and maintaining 

the Institute for a fiscal year may be paid from— 

(1) any funds available for that fiscal year for operation 

and maintenance for the executive agent designated under subsection (a)(2); or 

(2) if no executive agent is designated under subsection 

(a)(2), any funds available for that fiscal year for the Department of Defense for operation and maintenance for Defensewide activities. 

(h) TUITION.—Tuition fees charged for persons who attend the 

Institute may not include the fixed costs of operating and maintaining the Institute. 

(i) ANNUAL REPORT.—The report shall include a copy of the latest report of the Board of Visitors received by the Secretary under 

subsection (e)(5), together with any comments of the Secretary on 

the Board’s report. Not later than March 15 of each year, the Secretary of Defense shall submit to Congress a detailed report on the 

activities of the Institute during the preceding year. The report 

shall be prepared in consultation with the Secretary of State. 

(Added Pub. L. 106–398, Sec. 1[[div. A], title IX, Sec. 911(a)], Oct. 30, 2000, 114 Stat. 1654, 

1654A–226; Pub. L. 107–107, div. A, title X, Sec. 1048(a)(16), Dec. 28, 2001, 115 Stat. 1223; Pub. 

L. 107–314, div. A, title IX, Sec. 932, Dec. 2, 2002, 116 Stat. 2625; Pub. L. 110–181, div. A, 

title IX, Sec. 956, Jan. 28, 2008, 122 Stat. 296.) 

§ 2167. National Defense University: admission of private 

sector civilians to professional military education 

program 

(a) AUTHORITY FOR ADMISSION.—The Secretary of Defense may 

permit eligible private sector employees who work in organizations 

relevant to national security to receive instruction at the National 

Defense University in accordance with this section. No more than 

the equivalent of 35 full-time student positions may be filled at any 

one time by private sector employees enrolled under this section. 

Upon successful completion of the course of instruction in which 

enrolled, any such private sector employee may be awarded an appropriate diploma or degree under section 2165 of this title. 

(b) ELIGIBLE PRIVATE SECTOR EMPLOYEES.—For purposes of 

this section, an eligible private sector employee is an individual 

employed by a private firm that is engaged in providing to the Department of Defense or other Government departments or agencies 

significant and substantial defense-related systems, products, or 
§ 2167a CH. 108—DEPARTMENT OF DEFENSE SCHOOLS 1040 

services or whose work product is relevant to national security policy or strategy. A private sector employee admitted for instruction 

at the National Defense University remains eligible for such instruction only so long as that person remains employed by the 

same firm. 

(c) ANNUAL CERTIFICATION BY SECRETARY OF DEFENSE.—Private sector employees may receive instruction at the National Defense University during any academic year only if, before the start 

of that academic year, the Secretary of Defense determines, and 

certifies to the Committee on Armed Services of the Senate and the 

Committee on Armed Services of the House of Representatives, 

that providing instruction to private sector employees under this 

section during that year will further national security interests of 

the United States. 

(d) PROGRAM REQUIREMENTS.—The Secretary of Defense shall 

ensure that— 

(1) the curriculum for the professional military education 

program in which private sector employees may be enrolled 

under this section is not readily available through other 

schools and concentrates on national security relevant issues; 

and 

(2) the course offerings at the National Defense University 

continue to be determined solely by the needs of the Department of Defense. 

(e) TUITION.—The President of the National Defense University 

shall charge students enrolled under this section a rate— 

(1) that is at least the rate charged for employees of the 

United States outside the Department of Defense, less infrastructure costs, and 

(2) that considers the value to the school and course of the 

private sector student. 

(f) STANDARDS OF CONDUCT.—While receiving instruction at 

the National Defense University, students enrolled under this section, to the extent practicable, are subject to the same regulations 

governing academic performance, attendance, norms of behavior, 

and enrollment as apply to Government civilian employees receiving instruction at the university. 

(g) USE OF FUNDS.—Amounts received by the National Defense 

University for instruction of students enrolled under this section 

shall be retained by the university to defray the costs of such instruction. The source, and the disposition, of such funds shall be 

specifically identified in records of the university. 

(Added Pub. L. 107–107, div. A, title V, Sec. 528(a)(1), Dec. 28, 2001, 115 Stat. 1102; amended 

Pub. L. 111–84, div. A, title V, Sec. 526, Oct. 28, 2009, 123 Stat. 2288; Pub. L. 111–383, div. 

A, title V, Sec. 592, Jan. 7, 2011, 124 Stat. 4232.) 

§ 2167a. Defense Cyber Investigations Training Academy: 

admission of private sector civilians to receive instruction 

(a) AUTHORITY FOR ADMISSION.—The Secretary of Defense may 

permit eligible private sector employees to receive instruction at 

the Defense Cyber Investigations Training Academy operating 

under the direction of the Defense Cyber Crime Center. No more 

than the equivalent of 200 full-time student positions may be filled 
1041 § 2168 CH. 108—DEPARTMENT OF DEFENSE SCHOOLS 

at any one time by private sector employees enrolled under this 

section, on a yearly basis. Upon successful completion of the course 

of instruction in which enrolled, any such private sector employee 

may be awarded an appropriate certification or diploma. 

(b) ELIGIBLE PRIVATE SECTOR EMPLOYEES.—For purposes of 

this section, an eligible private sector employee is an individual 

employed by a private firm that is engaged in providing to the Department of Defense or other Government departments or agencies 

significant and substantial defense-related systems, products, or 

services, or whose work product is relevant to national security policy or strategy. A private sector employee remains eligible for such 

instruction only so long as that person remains employed by an eligible private sector firm. 

(c) PROGRAM REQUIREMENTS.—The Secretary of Defense shall 

ensure that— 

(1) the curriculum in which private sector employees may 

be enrolled under this section is not readily available through 

other schools; and 

(2) the course offerings at the Defense Cyber Investigations Training Academy continue to be determined solely by 

the needs of the Department of Defense. 

(d) TUITION.—The Secretary of Defense shall charge private 

sector employees enrolled under this section tuition at a rate that 

is at least equal to the rate charged for employees of the United 

States. In determining tuition rates, the Secretary shall include 

overhead costs of the Defense Cyber Investigations Training Academy. 

(e) STANDARDS OF CONDUCT.—While receiving instruction at 

the Defense Cyber Investigations Training Academy, students enrolled under this section, to the extent practicable, are subject to 

the same regulations governing academic performance, attendance, 

norms of behavior, and enrollment as apply to Government civilian 

employees receiving instruction at the Academy. 

(f) USE OF FUNDS.—Amounts received by the Defense Cyber Investigations Training Academy for instruction of students enrolled 

under this section shall be retained by the Academy to defray the 

costs of such instruction. The source, and the disposition, of such 

funds shall be specifically identified in records of the Academy. 

(Added Pub. L. 111–84, div. A, title IX, Sec. 901(a), Oct. 28, 2009, 123 Stat. 2422.) 

§ 2168. Defense Language Institute Foreign Language Center: degree of Associate of Arts in foreign language 

(a) Subject to subsection (b), the Commandant of the Defense 

Language Institute may confer an Associate of Arts degree in a foreign language upon any graduate of the Foreign Language Center 

of the Institute who fulfills the requirements for that degree. 

(b) A degree may be conferred upon a student under this section only if the Provost of the Center certifies to the Commandant 

that the student has satisfied all the requirements prescribed for 

the degree. 

(c) The authority provided by subsection (a) shall be exercised 

under regulations prescribed by the Secretary of Defense. 

(Added Pub. L. 107–107, title V, Sec. 531(a), Dec. 28, 2001, 115 Stat. 1104.) 
§ 2169 CH. 108—DEPARTMENT OF DEFENSE SCHOOLS 1042 

§ 2169. School of Nursing: establishment 

(a) ESTABLISHMENT AUTHORIZED.—The Secretary of Defense 

may establish a School of Nursing. 

(b) DEGREE GRANTING AUTHORITY.—The School of Nursing 

may include a program that awards a bachelor of science in nursing. 

(c) PHASED DEVELOPMENT.—The Secretary of Defense may develop the School of Nursing in phases as determined appropriate 

by the Secretary. 

(Added Pub. L. 111–84, div. A, title V, Sec. 525(a)(2), Oct. 28, 2009, 123 Stat. 2286.) 
1043 

CHAPTER 109—EDUCATIONAL LOAN REPAYMENT 

PROGRAMS 

Sec. 

2171. Education loan repayment program: enlisted members on active duty in 

specified military specialties. 

[2172. Renumbered.] 

2173. Education loan repayment program: commissioned officers in specified 

health professions. 

2174. Interest payment program: members on active duty. 

§ 2171. Education loan repayment program: enlisted members on active duty in specified military specialties 

(a)(1) Subject to the provisions of this section, the Secretary of 

Defense may repay— 

(A) any loan made, insured, or guaranteed under part B of 

title IV of the Higher Education Act of 1965 (20 U.S.C. 1071 

et seq.); 

(B) any loan made under part D of such title (the William 

D. Ford Federal Direct Loan Program, 20 U.S.C. 1087a et 

seq.); 

(C) any loan made under part E of such title (20 U.S.C. 

1087aa et seq.); or 

(D) any loan incurred for educational purposes made by a 

lender that is— 

(i) an agency or instrumentality of a State; 

(ii) a financial or credit institution (including an insurance company) that is subject to examination and supervision by an agency of the United States or any State; 

(iii) a pension fund approved by the Secretary for purposes of this section; or 

(iv) a non-profit private entity designated by a State, 

regulated by such State, and approved by the Secretary for 

purposes of this section. 

Repayment of any such loan shall be made on the basis of each 

complete year of service performed by the borrower. 

(2) The Secretary may repay loans described in paragraph (1) 

in the case of any person for service performed on active duty as 

a member in an officer program or military specialty specified by 

the Secretary. 

(b) The portion or amount of a loan that may be repaid under 

subsection (a) is 331⁄3 percent or $1,500, whichever is greater, for 

each year of service. 

(c) If a portion of a loan is repaid under this section for any 

year, interest on the remainder of such loan shall accrue and be 

paid in the same manner as is otherwise required. 

(d) Nothing in this section shall be construed to authorize refunding any repayment of a loan. 
[§ 2172 CH. 109—EDUCATIONAL LOAN REPAYMENT PROGRAMS 1044 

(e) A person who transfers from service making the person eligible for repayment of loans under this section (as described in subsection (a)(2)) to service making the person eligible for repayment 

of loans under section 16301 of this title (as described in subsection 

(a)(2) of that section) during a year shall be eligible to have repaid 

a portion of such loan determined by giving appropriate fractional 

credit for each portion of the year so served, in accordance with 

regulations of the Secretary concerned. 

(f) The Secretary of Defense shall, by regulation, prescribe a 

schedule for the allocation of funds made available to carry out the 

provisions of this section and section 16301 of this title during any 

year for which funds are not sufficient to pay the sum of the 

amounts eligible for repayment under subsection (a) and section 

16301(a) of this title. 

(g) Except a person described in subsection (e) who transfers 

to service making the person eligible for repayment of loans under 

section 16301 of this title, a member of the armed forces who fails 

to complete the period of service required to qualify for loan repayment under this section shall be subject to the repayment provisions of section 303a(e) of title 37. 

(h) The Secretary of Defense may prescribe, by regulations, 

procedures for implementing this section, including standards for 

qualified loans and authorized payees and other terms and conditions for making loan repayments. Such regulations may include 

exceptions that would allow for the payment as a lump sum of any 

loan repayment due to a member under a written agreement that 

existed at the time of a member’s death or disability. 

(Added Pub. L. 99–145, title VI, Sec. 671(a)(1), Nov. 8, 1985, 99 Stat. 661; amended Pub. L. 103– 

337, div. A, title XVI, Sec. 1663(e), Oct. 5, 1994, 108 Stat. 3009; Pub. L. 104–106, div. A, title 

X, Sec. 1079(a), Feb. 10, 1996, 110 Stat. 451; Pub. L. 109–163, div. A, title V, Sec. 537, Jan. 

6, 2006, 119 Stat. 3249; Pub. L. 111–383, div. A, title V, Sec. 552(a), Jan. 7, 2011, 124 Stat. 

4220.) 

[§ 2172. Renumbered 16302] 

§ 2173. Education loan repayment program: commissioned 

officers in specified health professions 

(a) AUTHORITY TO REPAY EDUCATION LOANS.—For the purpose 

of maintaining adequate numbers of commissioned officers of the 

armed forces on active duty who are qualified in the various health 

professions, the Secretary of a military department may repay, in 

the case of a person described in subsection (b), a loan that— 

(1) was used by the person to finance education regarding 

a health profession; and 

(2) was obtained from a governmental entity, private financial institution, school, or other authorized entity. 

(b) ELIGIBLE PERSONS.—To be eligible to obtain a loan repayment under this section, a person must— 

(1) satisfy one of the requirements specified in subsection 

(c); 

(2) be fully qualified for, or hold, an appointment as a commissioned officer in one of the health professions; and 

(3) sign a written agreement to serve on active duty, or, if 

on active duty, to remain on active duty for a period in addition to any other incurred active duty obligation. 
1045 § 2173 CH. 109—EDUCATIONAL LOAN REPAYMENT PROGRAMS 

(c) ACADEMIC AND PROFESSIONAL REQUIREMENTS.—One of the 

following academic requirements must be satisfied for purposes of 

determining the eligibility of a person for a loan repayment under 

this section: 

(1) The person is fully qualified in a health care profession 

that the Secretary of the military department concerned has 

determined to be necessary to meet identified skill shortages. 

(2) The person is enrolled as a full-time student in the 

final year of a course of study at an accredited educational institution leading to a degree in a health profession other than 

medicine or osteopathic medicine. 

(3) The person is enrolled in the final year of an approved 

graduate program leading to specialty qualification in medicine, dentistry, osteopathic medicine, or other health profession. 

(4) The person is enrolled in the Armed Forces Health Professions Scholarship and Financial Assistance Program under 

subchapter I of chapter 105 of this title for a number of years 

less than is required to complete the normal length of the 

course of study required for the health profession concerned. 

(d) CERTAIN PERSONS INELIGIBLE.—Students of the Uniformed 

Services University of the Health Sciences established under section 2112 of this title are not eligible for the repayment of an education loan under this section. 

(e) LOAN REPAYMENTS.—(1) Subject to the limits established by 

paragraph (2), a loan repayment under this section may consist of 

payment of the principal, interest, and related expenses of a loan 

obtained by a person described in subsection (b) for— 

(A) all educational expenses, comparable to all educational 

expenses recognized under section 2127(a) of this title for participants in the Armed Forces Health Professions Scholarship 

and Financial Assistance program; and 

(B) reasonable living expenses, not to exceed expenses 

comparable to the stipend paid under section 2121(d) of this 

title for participants in the Armed Forces Health Professions 

Scholarship and Financial Assistance program. 

(2) For each year of obligated service that a person agrees to 

serve in an agreement described in subsection (b)(3), the Secretary 

of the military department concerned may pay not more than 

$60,000 on behalf of the person. This maximum amount shall be 

increased annually by the Secretary of Defense effective October 1 

of each year by the percentage equal to the percent increase in the 

average annual cost of educational expenses and stipend costs of a 

single scholarship under the Armed Forces Health Professions 

Scholarship and Financial Assistance program. 

(f) ACTIVE DUTY SERVICE OBLIGATION.—(1) A person entering 

into an agreement described in subsection (b)(3) incurs an active 

duty service obligation. The length of this obligation shall be determined under regulations prescribed by the Secretary of Defense, 

but those regulations may not provide for a period of obligation of 

less than one year for each maximum annual amount, or portion 

thereof, paid on behalf of the person for qualified loans. 
§ 2174 CH. 109—EDUCATIONAL LOAN REPAYMENT PROGRAMS 1046 

(2) For persons on active duty before entering into the agreement, the active duty service obligation shall be served consecutively to any other obligation incurred under the agreement. 

(g) EFFECT OF FAILURE TO COMPLETE OBLIGATION.—(1) A commissioned officer who is relieved of the officer’s active duty obligation under this section before the completion of that obligation may 

be given, with or without the consent of the officer, any alternative 

obligation comparable to any of the alternative obligations authorized by section 2123(e) of this title for participants in the Armed 

Forces Health Professions Scholarship and Financial Assistance 

program. 

(2) An officer who does not complete the period of active duty 

specified in the agreement entered into under subsection (b)(3), or 

the alternative obligation imposed under paragraph (1), shall be 

subject to the repayment provisions of section 303a(e) of title 37. 

(h) REGULATIONS.—The Secretary of Defense shall prescribe 

regulations to carry out this section, including standards for qualified loans and authorized payees and other terms and conditions 

for the making of loan repayments. 

(Added Pub. L. 105–85, div. A, title VI, Sec. 651(a), Nov. 18, 1997, 111 Stat. 1802; amended 

Pub. L. 107–314, div. A, title V, Sec. 573, Dec. 2, 2002, 116 Stat. 2558; Pub. L. 109–163, div. 

A, title VI, Sec. 687(c)(7), Jan. 6, 2006, 119 Stat. 3334; Pub. L. 109–364, div. A, title V, Sec. 

537(a), Oct. 17, 2006, 120 Stat. 2209; Pub. L. 111–383, div. A, title V, Sec. 553, Jan. 7, 2011, 

124 Stat. 4220.) 

§ 2174. Interest payment program: members on active duty 

(a) AUTHORITY.—(1) The Secretary concerned may pay in accordance with this section the interest and any special allowances 

that accrue on one or more student loans of an eligible member of 

the armed forces. 

(2) The Secretary of a military department may exercise the 

authority under paragraph (1) only if approved by the Secretary of 

Defense and subject to such requirements, conditions, and restrictions as the Secretary of Defense may prescribe. 

(b) ELIGIBLE MEMBERS.—A member of the armed forces is eligible for the benefit under subsection (a) while the member— 

(1) is serving on active duty in fulfillment of the member’s 

first enlistment in the armed forces or, in the case of an officer, 

is serving on active duty and has not completed more than 

three years of service on active duty; 

(2) is the debtor on one or more unpaid loans described in 

subsection (c); and 

(3) is not in default on any such loan. 

(c) STUDENT LOANS.—The authority to make payments under 

subsection (a) may be exercised with respect to the following loans: 

(1) A loan made, insured, or guaranteed under part B of 

title IV of the Higher Education Act of 1965 (20 U.S.C. 1071 

et seq.). 

(2) A loan made under part D of such title (20 U.S.C. 

1087a et seq.). 

(3) A loan made under part E of such title (20 U.S.C. 

1087aa et seq.). 

(d) MAXIMUM BENEFIT.—The months for which interest and 

any special allowance may be paid on behalf of a member of the 
1047 § 2174 CH. 109—EDUCATIONAL LOAN REPAYMENT PROGRAMS 

armed forces under this section are any 36 consecutive months during which the member is eligible under subsection (b). 

(e) FUNDS FOR PAYMENTS.—Appropriations available for the 

pay and allowances of military personnel shall be available for payments under this section. 

(f) COORDINATION.—(1) The Secretary of Defense and, with respect to the Coast Guard when it is not operating as a service in 

the Navy, the Secretary of the Department in which the Coast 

Guard is operating shall consult with the Secretary of Education 

regarding the administration of the authority under this section. 

(2) The Secretary concerned shall transfer to the Secretary of 

Education the funds necessary— 

(A) to pay interest and special allowances on student loans 

under this section (in accordance with sections 428(o), 455(l), 

and 464(j) of the Higher Education Act of 1965 (20 U.S.C. 

1078(o), 1087e(l), and 1087dd(j)); and 

(B) to reimburse the Secretary of Education for any reasonable administrative costs incurred by the Secretary in coordinating the program under this section with the administration of the student loan programs under parts B, D, and E of 

title IV of the Higher Education Act of 1965. 

(g) SPECIAL ALLOWANCE DEFINED.—In this section, the term 

‘‘special allowance’’ means a special allowance that is payable 

under section 438 of the Higher Education Act of 1965 (20 U.S.C. 

1087–1). 

(Added Pub. L. 107–314, div. A, title VI, Sec. 651(a)(1), Dec. 2, 2002, 116 Stat. 2578.) 
1048 

CHAPTER 110—EDUCATIONAL ASSISTANCE FOR 

MEMBERS HELD AS CAPTIVES AND THEIR DEPENDENTS 

Sec. 

2181. Definitions. 

2182. Educational assistance: dependents of captives. 

2183. Educational assistance: former captives. 

2184. Termination of assistance. 

2185. Programs to be consistent with programs administered by the Department 

of Veterans Affairs. 

§ 2181. Definitions 

In this chapter: 

(1) The terms ‘‘captive status’’ and ‘‘former captive’’ have 

the meanings given those terms in section 559 of title 37. 

(2) The term ‘‘dependent’’ has the meaning given that term 

in section 551 of that title. 

(Added Pub. L. 99–399, title VIII, Sec. 806(d)(1), Aug. 27, 1986, 100 Stat. 887, and Pub. L. 100– 

26, Sec. 7(k)(6), Apr. 21, 1987, 101 Stat. 284.) 

§ 2182. Educational assistance: dependents of captives 

(a) Under regulations prescribed by the President, the Secretary concerned shall pay (by advancement or reimbursement) a 

dependent of a person who is in a captive status for expenses incurred, while attending an educational or training institution, for— 

(1) subsistence; 

(2) tuition; 

(3) fees; 

(4) supplies; 

(5) books; 

(6) equipment; and 

(7) other educational expenses. 

(b) Except as provided in section 2184 of this title, payments 

shall be available under this section for a dependent of a person 

who is in a captive status for education or training that occurs— 

(1) after that person is in a captive status for not less than 

90 days; and 

(2) on or before— 

(A) the end of any semester or quarter (as appropriate) 

that begins before the date on which the captive status of 

that person terminates; 

(B) the earlier of the end of any course that began before such date or the end of the 16-week period following 

that date if the educational or training institution is not 

operated on a semester or quarter system; or 

(C) a date specified by the Secretary concerned in 

order to respond to special circumstances. 

(c) If a person in a captive status or a former captive dies and 
1049 § 2185 CH. 110—EDUCATIONAL ASSISTANCE FOR CAPTIVES 

the death is incident to the captivity, payments shall be available 

under this section for a dependent of that person for education or 

training that occurs after the date of the death of that person. 

(d) The provisions of this section shall not apply to any dependent who is eligible for assistance under chapter 35 of title 38 or 

similar assistance under any other provision of law. 

(Added Pub. L. 99–399, title VIII, Sec. 806(d)(1), Aug. 27, 1986, 100 Stat. 887.) 

§ 2183. Educational assistance: former captives 

(a) In order to respond to special circumstances, the Secretary 

concerned may pay (by advancement or reimbursement) a person 

who is a former captive for expenses incurred, while attending an 

educational or training institution, for— 

(1) subsistence; 

(2) tuition; 

(3) fees; 

(4) supplies; 

(5) books; 

(6) equipment; and 

(7) other educational expenses. 

(b) Except as provided in section 2184 of this title, payments 

shall be available under this section for a person who is a former 

captive for education or training that occurs— 

(1) after the termination of the status of that person as a 

captive; and 

(2) on or before— 

(A) the end of any semester or quarter (as appropriate) 

that begins before the end of the 10-year period beginning 

on the date on which the status of that person as a captive 

terminates; or 

(B) if the educational or training institution is not operated on a semester or quarter system, the earlier of the 

end of any course that began before such date or the end 

of the 16-week period following that date. 

(c) Payments shall be available under this section only to the 

extent that such payments are not otherwise authorized by law. 

(Added Pub. L. 99–399, title VIII, Sec. 806(d)(1), Aug. 27, 1986, 100 Stat. 888.) 

§ 2184. Termination of assistance 

Assistance under this chapter— 

(1) shall be discontinued for any person whose conduct or 

progress is unsatisfactory under standards consistent with 

those established under section 3524 of title 38; and 

(2) may not be provided for any person for more than 45 

months (or the equivalent in other than full-time education or 

training). 

(Added Pub. L. 99–399, title VIII, Sec. 806(d)(1), Aug. 27, 1986, 100 Stat. 888; amended Pub. 

L. 103–337, div. A, title X, Sec. 1070(e)(7), Oct. 5, 1994, 108 Stat. 2859.) 

§ 2185. Programs to be consistent with programs administered by the Department of Veterans Affairs 

Regulations prescribed to carry out this chapter shall provide 

that the programs under this chapter shall be consistent with the 
§ 2185 CH. 110—EDUCATIONAL ASSISTANCE FOR CAPTIVES 1050 

educational assistance programs under chapters 35 and 36 of title 

38. 

(Added Pub. L. 99–399, title VIII, Sec. 806(d)(1), Aug. 27, 1986, 100 Stat. 888; amended Pub. 

L. 101–189, div. A, title XVI, Sec. 1621(a)(7)(A), Nov. 29, 1989, 103 Stat. 1603.) 
1051 

CHAPTER 111—SUPPORT OF SCIENCE, MATHEMATICS, 

AND ENGINEERING EDUCATION 

Sec. 

2191. Graduate fellowships. 

2192. Improvement of education in technical fields: general authority regarding 

education in science, mathematics, and engineering. 

2192a. Science, Mathematics, and Research for Transformation (SMART) Defense 

Education Program. 

2193. Improvement of education in technical fields: grants for higher education 

in science and mathematics. 

2193a. Improvement of education in technical fields: general authority for support 

of elementary and secondary education in science and mathematics. 

2193b. Improvement of education in technical fields: program for support of elementary and secondary education in science, mathematics, and technology. 

2194. Education partnerships. 

2195. Department of Defense cooperative education programs. 

2196. Manufacturing engineering education: grant program. 

2197. Manufacturing experts in the classroom. 

2198. Management training program in Japanese language and culture. 

2199. Definitions. 

§ 2191. Graduate fellowships 

(a) The Secretary of Defense shall prescribe regulations providing for the award of fellowships to citizens and nationals of the 

United States who agree to pursue graduate degrees in science, engineering, or other fields of study designated by the Secretary to 

be of priority interest to the Department of Defense. 

(b) A fellowship awarded pursuant to regulations prescribed 

under subsection (a) shall be known as a ‘‘National Defense Science 

and Engineering Graduate Fellowship’’. 

(c) National Defense Science and Engineering Graduate Fellowships shall be awarded solely on the basis of academic ability. 

The Secretary shall take all appropriate actions to encourage applications for such fellowships of persons who are members of groups 

(including minority groups, women, and disabled persons) which 

historically have been underrepresented in science and technology 

fields. Recipients shall be selected on the basis of a nationwide 

competition. The award of a fellowship under this section may not 

be predicated on the geographic region in which the recipient lives 

or the geographic region in which the recipient will pursue an advanced degree. 

(d) The regulations prescribed under this section shall include— (1) the criteria for award of fellowships; 

(2) the procedures for selecting recipients; 

(3) the basis for determining the amount of a fellowship; 

and 

(4) the maximum amount that may be awarded to an individual during an academic year. 

(Added Pub. L. 101–189, div. A, title VIII, Sec. 843(d)(1), Nov. 29, 1989, 103 Stat. 1516.) 
§ 2192 CH. 111—SUPPORT OF SCIENCE, MATH, & ENGINEERING 1052 

§ 2192. Improvement of education in technical fields: general authority regarding education in science, 

mathematics, and engineering 

(a) The Secretary of Defense, in consultation with the Secretary of Education, shall, on a continuing basis— 

(1) identify actions which the Department of Defense may 

take to improve education in the scientific, mathematics, and 

engineering skills necessary to meet the long-term national defense needs of the United States for personnel proficient in 

such skills; and 

(2) establish and conduct programs to carry out such actions. 

(b)(1) In furtherance of the authority of the Secretary of Defense under any provision of this chapter or any other provision of 

law to support educational programs in science, mathematics, engineering, and technology, the Secretary of Defense may, unless otherwise specified in such provision— 

(A) enter into contracts and cooperative agreements with 

eligible entities; 

(B) make grants of financial assistance to eligible entities; 

(C) provide cash awards and other items to eligible entities; 

(D) accept voluntary services from eligible entities; and 

(E) support national competition judging, other educational 

event activities, and associated award ceremonies in connection 

with these educational programs. 

(2) The Secretary of Defense may carry out the authority in 

paragraph (1) through the Secretaries of the military departments. 

(3) In this subsection: 

(A) The term ‘‘eligible entity’’ includes a department or 

agency of the Federal Government, a State, a political subdivision of a State, an individual, and a not-for-profit or other organization in the private sector. 

(B) The term ‘‘State’’ means any State of the United 

States, the District of Columbia, the Commonwealth of Puerto 

Rico, Guam, the United States Virgin Islands, the Commonwealth of the Northern Mariana Islands, American Samoa, and 

any other territory or possession of the United States. 

(c) The Secretary shall designate an individual within the Office of the Secretary of Defense to advise and assist the Secretary 

regarding matters relating to science, mathematics, and engineering education and training. 

(Added Pub. L. 101–510, div. A, title II, Sec. 247(a)(1), Nov. 5, 1990, 104 Stat. 1521; amended 

Pub. L. 106–65, div. A, title V, Sec. 580(d)(1), Oct. 5, 1999, 113 Stat. 633; Pub. L. 108–136, div. 

A, title II, Sec. 233, Nov. 24, 2003, 117 Stat. 1423; Pub. L. 111–383, div. A, title II, Sec. 211(a), 

Jan. 7, 2011, 124 Stat. 4162.) 

§ 2192a. Science, Mathematics, and Research for Transformation (SMART) Defense Education Program 

(a) REQUIREMENT FOR PROGRAM.—The Secretary of Defense 

shall carry out a program to provide financial assistance for education in science, mathematics, engineering, and technology skills 

and disciplines that, as determined by the Secretary, are critical to 
1053 § 2192a CH. 111—SUPPORT OF SCIENCE, MATH, & ENGINEERING 

the national security functions of the Department of Defense and 

are needed in the Department of Defense workforce. 

(b) FINANCIAL ASSISTANCE.—(1) Under the program under this 

section, the Secretary of Defense may award a scholarship or fellowship in accordance with this section to a person who— 

(A) is a citizen of the United States; 

(B) is pursuing an associates degree, undergraduate degree, or advanced degree in a critical skill or discipline described in subsection (a) at an accredited institution of higher 

education; and 

(C) enters into a service agreement with the Secretary of 

Defense as described in subsection (c). 

(2) The amount of the financial assistance provided under a 

scholarship or fellowship awarded to a person under this subsection shall be the amount determined by the Secretary of Defense 

as being necessary to pay all educational expenses incurred by that 

person, including tuition, fees, cost of books, laboratory expenses, 

equipment expenses, and expenses of room and board. 

(3) Financial assistance provided under a scholarship or fellowship awarded under this section may be paid directly to the recipient of such scholarship or fellowship or to an administering entity 

for disbursement of the funds. 

(c) SERVICE AGREEMENT FOR RECIPIENTS OF FINANCIAL ASSIST- ANCE.—(1) To receive financial assistance under this section— 

(A) in the case of an employee of the Department of Defense, the employee shall enter into a written agreement to 

continue in the employment of the department for the period 

of obligated service determined under paragraph (2); and 

(B) in the case of a person not an employee of the Department of Defense, the person shall enter into a written agreement to accept and continue employment in the Department of 

Defense for the period of obligated service determined under 

paragraph (2). 

(2) For the purposes of this subsection, the period of obligated 

service for a recipient of financial assistance under this section 

shall be the period determined by the Secretary of Defense as being 

appropriate to obtain adequate service in exchange for such financial assistance. The period of service required of a recipient may 

not be less than the total period of pursuit of a degree that is covered by such financial assistance. The period of obligated service is 

in addition to any other period for which the recipient is obligated 

to serve in the civil service of the United States. 

(3) An agreement entered into under this subsection by a person pursuing an academic degree shall include any terms and conditions that the Secretary of Defense determines necessary to protect the interests of the United States or otherwise appropriate for 

carrying out this section. 

(d) EMPLOYMENT OF PROGRAM PARTICIPANTS.—The Secretary of 

Defense— 

(1) may, without regard to any provision of title 5 governing appointment of employees to competitive service positions within the Department of Defense, appoint to a position 

in the Department of Defense in the excepted service an individual who has successfully completed an academic program 
§ 2192a CH. 111—SUPPORT OF SCIENCE, MATH, & ENGINEERING 1054 

for which a scholarship or fellowship under this section was 

awarded and who, under the terms of the agreement for such 

scholarship or fellowship, at the time of such appointment, 

owes a service commitment to the Department; and 

(2) may, upon satisfactory completion of 2 years of substantially continuous service by an incumbent who was appointed to an excepted service position under the authority of 

paragraph (1), convert the appointment of such individual, 

without competition, to a career or career conditional appointment. 

(e) REFUND FOR PERIOD OF UNSERVED OBLIGATED SERVICE.— (1)(A) A participant in the program under this section who is not 

an employee of the Department of Defense and who voluntarily 

fails to complete the educational program for which financial assistance has been provided under this section, or fails to maintain 

satisfactory academic progress as determined in accordance with 

regulations prescribed by the Secretary of Defense, shall refund to 

the United States an appropriate amount, as determined by the 

Secretary. 

(B) A participant in the program under this section who is an 

employee of the Department of Defense and who— 

(i) voluntarily fails to complete the educational program 

for which financial assistance has been provided, or fails to 

maintain satisfactory academic progress as determined in accordance with regulations prescribed by the Secretary; or 

(ii) before completion of the period of obligated service required of such participant— 

(I) voluntarily terminates such participant’s employment with the Department; or 

(II) is removed from such participant’s employment 

with the Department on the basis of misconduct, 

shall refund the United States an appropriate amount, as determined by the Secretary. 

(2) An obligation to reimburse the United States imposed 

under paragraph (1) is for all purposes a debt owed to the United 

States. 

(3) The Secretary of Defense may waive, in whole or in part, 

a refund required under paragraph (1) if the Secretary determines 

that recovery would be against equity and good conscience or would 

be contrary to the best interests of the United States. 

(4) A discharge in bankruptcy under title 11 that is entered 

less than five years after the termination of an agreement under 

this section does not discharge the person signing such agreement 

from a debt arising under such agreement or under this subsection. 

(f) RELATIONSHIP TO OTHER PROGRAMS.—The Secretary of Defense shall coordinate the provision of financial assistance under 

the authority of this section with the provision of financial assistance under the other authorities provided in this chapter in order 

to maximize the benefits derived by the Department of Defense 

from the exercise of all such authorities. 

(g) INSTITUTION OF HIGHER EDUCATION DEFINED.—In this section, the term ‘‘institution of higher education’’ has the meaning 

given such term in section 101 of the Higher Education Act of 1965 

(21 U.S.C. 1001). 
1055 § 2193a CH. 111—SUPPORT OF SCIENCE, MATH, & ENGINEERING 

(Added Pub. L. 109–163, div. A, title XI, Sec. 1104(d)(1), Jan. 6, 2006, 119 Stat. 3449; amended 

Pub. L. 110–417, [div. A], title X, Sec. 1061(a)(5), Oct. 14, 2008, 122 Stat. 4612; Pub. L. 111– 

84, div. A, title XI, Sec. 1102(a)–(d)(1), Oct. 28, 2009, 123 Stat. 2484, 2485.) 

§ 2193. Improvement of education in technical fields: grants 

for higher education in science and mathematics 

(a)(1) The Secretary of Defense may, in accordance with the 

provisions of this subsection, carry out a program for awarding 

grants to students who have been accepted for enrollment in, or 

who are enrolled in, an institution of higher education as undergraduate or graduate students in scientific and engineering disciplines critical to the national security functions of the Department of Defense. 

(2) Grant proceeds shall be disbursed on behalf of students 

awarded grants under this subsection to the institutions of higher 

education at which the students are enrolled. No grant proceeds 

shall be disbursed on behalf of a student until the student is enrolled at an institution of higher education. 

(3) The amount of a grant awarded a student under this subsection may not exceed the student’s cost of attendance. 

(4) The amount of a grant awarded a student under this subsection shall not be reduced on the basis of the student’s receipt of 

other forms of Federal student financial assistance, but shall be 

taken into account in determining the eligibility of the student for 

those other forms of Federal student financial assistance. 

(5) The Secretary shall give priority to awarding grants under 

this subsection in a manner likely to stimulate the interest of 

women and members of minority groups in pursuing scientific and 

engineering careers. The Secretary may consider the financial need 

of applicants in making awards in accordance with such priority. 

(b) In this section: 

(1) The term ‘‘institution of higher education’’ has the 

meaning given such term in section 101 of the Higher Education Act of 1965. 

(2) The term ‘‘cost of attendance’’ has the meaning given 

such term in section 472 of the Higher Education Act of 1965 

(20 U.S.C. 1087ll). 

(Added Pub. L. 101–510, div. A, title II, Sec. 247(a)(1), Nov. 5, 1990, 104 Stat. 1521; amended 

Pub. L. 105–244, title I, Sec. 102(a)(2)(A), Oct. 7, 1998, 112 Stat. 1617; Pub. L. 106–65, div. A, 

title V, Sec. 580(c)(2), (3), (d)(2), Oct. 5, 1999, 113 Stat. 633.) 

§ 2193a. Improvement of education in technical fields: general authority for support of elementary and secondary education in science and mathematics 

The Secretary of Defense, in coordination with the Secretary of 

Education, may establish programs for the purpose of improving 

the mathematics and scientific knowledge and skills of elementary 

and secondary school students and faculty members. 

(Added and amended Pub. L. 106–65, div. A, title V, Sec. 580(c)(1), (2), Oct. 5, 1999, 113 Stat. 

632, 633.) 
§ 2193b CH. 111—SUPPORT OF SCIENCE, MATH, & ENGINEERING 1056 

§ 2193b. Improvement of education in technical fields: program for support of elementary and secondary 

education in science, mathematics, and technology 

(a) AUTHORITY FOR PROGRAM.—The Secretary of Defense may 

conduct a science, mathematics, and technology education improvement program known as the ‘‘Department of Defense STARBASE 

Program’’. The Secretary shall carry out the program in coordination with the Secretaries of the military departments. 

(b) PURPOSE.—The purpose of the program is to improve 

knowledge and skills of students in kindergarten through twelfth 

grade in mathematics, science, and technology. 

(c) STARBASE ACADEMIES.—(1) The Secretary shall provide 

for the establishment of at least 25 academies under the program. 

(2) The Secretary of Defense shall establish guidelines, criteria, 

and a process for the establishment of STARBASE programs in addition to those in operation on October 5, 1999. 

(3)(A) Except as otherwise provided under subparagraph (B), 

the Secretary may not support the establishment in any State of 

more than four academies under the program. 

(B) The Secretary may support the establishment and operation of an academy in a State in excess of four academies in that 

State if the Secretary expressly waives, in writing, the limitation 

in subparagraph (A) with respect to that State. In the case of any 

such waiver, appropriated funds may be used for the establishment 

and operation of an academy in excess of four in that State only 

to the extent that appropriated funds are expressly available for 

that purpose. Any such waiver shall be made under criteria to be 

prescribed by the Secretary. 

(d) PERSONS ELIGIBLE TO PARTICIPATE IN PROGRAM.—The Secretary shall prescribe standards and procedures for selection of persons for participation in the program. 

(e) REGULATIONS.—The Secretary of Defense shall prescribe 

regulations governing the conduct of the program. 

(f) AUTHORITY TO ACCEPT FINANCIAL AND OTHER SUPPORT.—(1) 

The Secretary of Defense and the Secretaries of the military departments may accept financial and other support for the program 

from other departments and agencies of the Federal Government, 

State governments, local governments, and not-for-profit and other 

organizations in the private sector. 

(2) The Secretary of Defense shall remain the executive agent 

to carry out the program regardless of the source of funds for the 

program or any transfer of jurisdiction over the program within the 

executive branch. 

(g) ANNUAL REPORT.—Not later than March 31 of each year, 

the Secretary of Defense shall submit to Congress a report on the 

program under this section. The report shall contain a discussion 

of the design and conduct of the program and an evaluation of the 

effectiveness of the program. 

(h) STATE DEFINED.—In this section, the term ‘‘State’’ includes 

the District of Columbia, the Commonwealth of Puerto Rico, the 

Virgin Islands, and Guam. 

(Added Pub. L. 106–65, div. A, title V, Sec. 580(a), Oct. 5, 1999, 113 Stat. 631; amended Pub. 

L. 107–107, div. A, title V, Sec. 596(b), Dec. 28, 2001, 115 Stat. 1127; Pub. L. 108–375, div. A, 

title V, Sec. 519, title X, Sec. 1084(d)(16), Oct. 28, 2004, 118 Stat. 1886, 2062; Pub. L. 110–181, 
1057 § 2194 CH. 111—SUPPORT OF SCIENCE, MATH, & ENGINEERING 

div. A, title V, Sec. 592, Jan. 28, 2008, 122 Stat. 138; Pub. L. 111–383, div. A, title V, Sec. 595, 

Jan. 7, 2011, 124 Stat. 4234.) 

§ 2194. Education partnerships 

(a) The Secretary of Defense shall authorize the director of 

each defense laboratory to enter into one or more education partnership agreements with educational institutions in the United 

States for the purpose of encouraging and enhancing study in scientific disciplines at all levels of education. The educational institutions referred to in the preceding sentence are local educational 

agency, colleges, universities, and any other nonprofit institutions 

that are dedicated to improving science, mathematics, and engineering education. 

(b) Under a partnership agreement entered into with an educational institution under this section, the director of a defense laboratory may provide, and is encouraged to provide, assistance to 

the educational institution by— 

(1) loaning defense laboratory equipment to the institution 

for any purpose and duration in support of such agreement 

that the director considers appropriate; 

(2) notwithstanding the provisions of subtitle I of title 40 

and division C (except sections 3302, 3501, 3501(b), 3509, 3906, 

4710, and 4711) of subtitle I of title 41 or any provision of law 

or regulation relating to transfers of surplus property, transferring to the institution any computer equipment, or other scientific equipment, that is— 

(A) commonly used by educational institutions; 

(B) surplus to the needs of the defense laboratory; and 

(C) determined by the director to be appropriate for 

support of such agreement; 

(3) making laboratory personnel available to teach science 

courses or to assist in the development of science courses and 

materials for the institution; 

(4) involving faculty and students of the institution in defense laboratory research projects; 

(5) cooperating with the institution in developing a program under which students may be given academic credit for 

work on defense laboratory research projects; and 

(6) providing academic and career advice and assistance to 

students of the institution. 

(c) The Secretary of Defense shall ensure that the director of 

each defense laboratory shall give a priority under this section to 

entering into an education partnership agreement with one or more 

historically Black colleges and universities and other minority institutions referred to in paragraphs (3), (4), and (5) of section 

312(b) of the Higher Education Act of 1965 (20 U.S.C. 1058(b)). 

(d) The Secretary of Defense shall ensure that, in entering into 

education partnership agreements under this section, the director 

of a defense laboratory gives a priority to providing assistance to 

educational institutions serving women, members of minority 

groups, and other groups of individuals who traditionally are involved in the engineering and science professions in disproportionately low numbers. 
§ 2195 CH. 111—SUPPORT OF SCIENCE, MATH, & ENGINEERING 1058 

(e) The Secretary of Defense may permit the director of a defense laboratory to enter into a cooperative agreement with an appropriate entity to act as an intermediary and assist the director 

in carrying out activities under this section. 

(f) In this section: 

(1) The term ‘‘defense laboratory’’ means any laboratory, 

product center, test center, depot, training and educational organization, or operational command under the jurisdiction of 

the Department of Defense. 

(2) The term ‘‘local educational agency’’ has the meaning 

given such term in section 9101 of the Elementary and Secondary Education Act of 1965. 

(Added Pub. L. 101–510, div. A, title II, Sec. 247(a)(1), Nov. 5, 1990, 104 Stat. 1522; amended 

Pub. L. 103–382, title III, Sec. 391(b)(4), Oct. 20, 1994, 108 Stat. 4021; Pub. L. 104–106, div. 

A, title XV, Sec. 1503(a)(19), Feb. 10, 1996, 110 Stat. 512; Pub. L.106–398, Sec. 1 [[div. A], title 

II, Sec. 253], Oct. 30, 2000, 114 Stat. 1654, 1654A–49; Pub. L. 107–110, title X, Sec. 1076(e), 

Jan. 8, 2002, 115 Stat. 2091; Pub. L. 108–178, Sec. 4(b)(1), Dec. 15, 2003, 117 Stat. 2640; Pub. 

L. 111–350, Sec. 5(b)(3), Jan. 4, 2011, 124 Stat. 3842; Pub. L. 111–383, div. A, title II, Sec. 

211(b), Jan. 7, 2011, 124 Stat. 4163.) 

§ 2195. Department of Defense cooperative education programs 

(a) The Secretary of Defense shall ensure that the director of 

each defense laboratory establishes, in association with one or more 

public or private colleges or universities in the United States or one 

or more consortia of colleges or universities in the United States, 

cooperative work-education programs for undergraduate and graduate students. 

(b) Under a cooperative work-education program established 

under subsection (a), a director referred to in that subsection may, 

without regard to any applicable non-statutory limitation on the 

number of authorized personnel or on the aggregate amount of any 

personnel cost— 

(1) make an offer for participation in the cooperative workeducation program directly to a student and appoint such student to an entry-level position of employment in the laboratory 

of such director; 

(2) pay such person a rate of basic pay, not to exceed the 

maximum rate of pay provided for grade GS–9 under the General Schedule under section 5332 of title 5, that is competitive 

with compensation levels provided for entry-level positions in 

similar industry-sponsored cooperative work-education programs; 

(3) pay all travel expenses between the college or university in which the student is enrolled and the laboratory concerned for not more than six round trips per year; and 

(4) pay all or part of such fees, charges, and costs related 

to the participation of such student in the cooperative workeducation program as tuition, matriculation fees, charges for library and laboratory services, materials, and supplies, and the 

purchase or rental price of books. 

(c) A director of a defense laboratory may— 

(1) require a student, as a condition for receiving payments 

referred to in subsection (b)(4), to enter into a written agreement to continue employment in such defense laboratory for a 

period of service specified in the agreement; or 
1059 § 2196 CH. 111—SUPPORT OF SCIENCE, MATH, & ENGINEERING 

(2) make such payments without requiring such an agreement. 

(d)(1) The Director of the National Security Agency may provide a qualifying employee of a defense laboratory of that Agency 

with living quarters at no charge, or at a rate or charge prescribed 

by the Director by regulation, without regard to section 5911(c) of 

title 5. 

(2) In this subsection, the term ‘‘qualifying employee’’ means a 

student who is employed at the National Security Agency under— 

(A) a Student Educational Employment Program of the 

Agency conducted under this section or any other provision of 

law; or 

(B) a similar cooperative or summer education program of 

the Agency that meets the criteria for Federal cooperative or 

summer education programs prescribed by the Office of Personnel Management. 

(Added Pub. L. 101–510, div. A, title II, Sec. 247(a)(1), Nov. 5, 1990, 104 Stat. 1522; amended 

Pub. L. 108–136, div. A, title IX, Sec. 926, Nov. 24, 2003, 117 Stat. 1579.) 

§ 2196. Manufacturing engineering education: grant program 

(a) ESTABLISHMENT OF GRANT PROGRAM.—(1) The Secretary of 

Defense shall establish a program under which the Secretary 

makes grants to support— 

(A) the enhancement of existing programs in manufacturing engineering education; or 

(B) the establishment of new programs in manufacturing 

engineering education that meet such requirements. 

(2) Grants under this section may be made to institutions of 

higher education or to consortia of such institutions. 

(3) The Secretary shall establish the program in consultation 

with the Secretary of Education, the Director of the National 

Science Foundation, and the Director of the Office of Science and 

Technology Policy. 

(b) NEW PROGRAMS IN MANUFACTURING ENGINEERING EDUCATION.—A program in manufacturing engineering education to be 

established at an institution of higher education may be considered 

to be a new program for the purpose of subsection (a)(1)(B) regardless of whether the program is to be conducted— 

(1) within an existing department in a school of engineering of the institution; 

(2) within a manufacturing engineering department to be 

established separately from the existing departments within 

such school of engineering; or 

(3) within a manufacturing engineering school or center to 

be established separately from an existing school of engineering of such institution. 

(c) MINIMUM NUMBER OF GRANTS FOR NEW PROGRAMS.—Of the 

total number of grants awarded pursuant to this section, at least 

one-third shall be awarded for the purpose stated in subsection 

(a)(1)(B). 

(d) GEOGRAPHICAL DISTRIBUTION OF GRANTS.—In awarding 

grants under this subsection, the Secretary shall, to the maximum 
§ 2196 CH. 111—SUPPORT OF SCIENCE, MATH, & ENGINEERING 1060 

extent practicable, avoid geographical concentration of grant 

awards. 

(e) COORDINATION OF GRANT PROGRAM WITH THE NATIONAL

SCIENCE FOUNDATION.—The Secretary of Defense and the Director 

of the National Science Foundation shall enter into an agreement 

for carrying out the grant program established pursuant to this 

section. The agreement shall include procedures to ensure that the 

grant program is fully coordinated with similar existing programs 

of the National Science Foundation. 

(f) COVERED PROGRAMS.—(1) A program of engineering education supported with a grant awarded pursuant to this section 

shall meet the requirements of this section. 

(2) Such a grant may be made for a program of education to 

be conducted at the undergraduate level, at the graduate level, or 

at both the undergraduate and graduate levels. 

(g) COMPONENTS OF PROGRAM.—The program of education for 

which such a grant is made shall be a consolidated and integrated 

multidisciplinary program of education having each of the following 

components: 

(1) Multidisciplinary instruction that encompasses the 

total manufacturing engineering enterprise and that may include— 

(A) manufacturing engineering education and training 

through classroom activities, laboratory activities, thesis 

projects, individual or team projects, and visits to industrial facilities, consortia, or centers of excellence in the 

United States and foreign countries; 

(B) faculty development programs; 

(C) recruitment of educators highly qualified in manufacturing engineering; 

(D) presentation of seminars, workshops, and training 

for the development of specific research or education skills; 

and 

(E) activities involving interaction between the institution of higher education conducting the program and industry, including programs for visiting scholars or industry 

executives. 

(2) Opportunities for students to obtain work experience in 

manufacturing through such activities as internships, summer 

job placements, or cooperative work-study programs. 

(3) Faculty and student research that is directly related to, 

and supportive of, the education of undergraduate or graduate 

students in advanced manufacturing science and technology 

because of— 

(A) the increased understanding of advanced manufacturing science and technology that is derived from such research; and 

(B) the enhanced quality and effectiveness of the instruction that result from that increased understanding. 

(h) GRANT PROPOSALS.—The Secretary of Defense, in coordination with the Director of the National Science Foundation, shall solicit from institutions of higher education in the United States (and 

from consortia of such institutions) proposals for grants to be made 

pursuant to this section for the support of programs of manufac-
1061 § 2197 CH. 111—SUPPORT OF SCIENCE, MATH, & ENGINEERING 

turing engineering education that are consistent with the purposes 

of this section. 

(i) MERIT COMPETITION.—Applications for grants shall be evaluated on the basis of merit pursuant to competitive procedures prescribed by the Secretary in consultation with the Director of the 

National Science Foundation. 

(j) SELECTION CRITERIA.—The Secretary may select a proposal 

for the award of a grant pursuant to this section if the proposal, 

at a minimum, does each of the following: 

(1) Contains innovative approaches for improving engineering education in manufacturing technology. 

(2) Demonstrates a strong commitment by the proponents 

to apply the resources necessary to achieve the objectives for 

which the grant is to be made. 

(3) Provides for the conduct of research that supports the 

instruction to be provided in the proposed program and is likely to improve manufacturing engineering and technology. 

(4) Demonstrates a significant level of involvement of 

United States industry in the proposed instructional and research activities. 

(5) Is likely to attract superior students. 

(6) Proposes to involve fully qualified faculty personnel 

who are experienced in research and education in areas associated with manufacturing engineering and technology. 

(7) Proposes a program that, within three years after the 

grant is made, is likely to attract from sources other than the 

Federal Government the financial and other support necessary 

to sustain such program. 

(8) Proposes to achieve a significant level of participation 

by women, members of minority groups, and individuals with 

disabilities through active recruitment of students from among 

such persons. 

(k) FEDERAL SUPPORT.—The amount of financial assistance furnished to an institution under this section may not exceed 50 percent of the estimated cost of carrying out the activities proposed to 

be supported in part with such financial assistance for the period 

for which the assistance is to be provided. 

(Added Pub. L. 102–190, div. A, title VIII, Sec. 825(a)(1), Dec. 5, 1991, 105 Stat. 1438.) 

§ 2197. Manufacturing experts in the classroom 

(a) ESTABLISHMENT OF PROGRAM.—The Secretary of Defense, in 

consultation with the Secretary of Education and the Secretary of 

Commerce, shall conduct a program to support the following activities of one or more manufacturing experts at institutions of higher 

education: 

(1) Identifying the education and training requirements of 

United States manufacturing firms located in the same geographic region as an institution participating in the program. 

(2) Assisting in the development of teaching curricula for 

classroom and in-factory education and training classes at such 

an institution. 

(3) Teaching such classes and overseeing the teaching of 

such classes by others. 
§ 2198 CH. 111—SUPPORT OF SCIENCE, MATH, & ENGINEERING 1062 

(4) Improving the knowledge and expertise of permanent 

faculty and staff of such an institution. 

(5) Marketing the programs and facilities of such an institution to firms referred to in paragraph (1). 

(6) Coordinating the activities described in the other provisions of this subsection with other programs conducted by the 

Federal Government, any State, any local government, or any 

private, nonprofit organization to modernize United States 

manufacturing firms, especially the regional centers for the 

transfer of manufacturing technology and programs receiving 

financial assistance under section 2196 of this title. 

(b) MERIT COMPETITION.—Applications for assistance under 

this section shall be evaluated on the basis of merit pursuant to 

competitive procedures prescribed by the Secretary. 

(c) SELECTION CRITERIA.—The Secretary shall select institutions for the award of financial assistance under this section from 

among institutions submitting applications for such assistance 

that— 

(1) demonstrate that the proposed activities are of an appropriate scale and a sufficient quality to ensure long term improvement in the applicant’s capability to serve the education 

and training needs of United States manufacturing firms in 

the same region as the applicant; 

(2) demonstrate a significant level of industry involvement 

and support; 

(3) demonstrate attention to the needs of any United 

States industries that supply manufactured products to the Department of Defense or to a contractor of the Department of 

Defense; and 

(4) meet such other criteria as the Secretary may prescribe. 

(d) FEDERAL SUPPORT.—The amount of financial assistance furnished to an institution under this section may not exceed 50 percent of the estimated cost of carrying out the activities proposed to 

be supported in part with such financial assistance for the period 

for which the assistance is to be provided. In no event may the 

amount of the financial assistance provided to an institution exceed 

$250,000 per year. The period for which financial assistance is provided an institution under this section shall be at least two years 

unless such assistance is earlier terminated for cause determined 

by the Secretary. 

(e) MANUFACTURING EXPERT DEFINED.—In this section, the 

term ‘‘manufacturing expert’’ means manufacturing managers and 

workers having experience in the organization of production and 

education and training needs and other experts in manufacturing. 

(Added Pub. L. 102–190, div. A, title VIII, Sec. 825(a)(1), Dec. 5, 1991, 105 Stat. 1440; amended 

Pub. L. 102–484, div. D, title XLII, Sec. 4238(a), (b)(1), Oct. 23, 1992, 106 Stat. 2694.) 

§ 2198. Management training program in Japanese language 

and culture 

(a) The Secretary of Defense, in coordination with the National 

Science Foundation, shall establish a program for the making of 

grants on a competitive basis to United States institutions of higher education and other United States not-for-profit organizations 
1063 § 2199 CH. 111—SUPPORT OF SCIENCE, MATH, & ENGINEERING 

for the conduct of programs for scientists, engineers, and managers 

to learn Japanese language and culture. 

(b) The Secretary of Defense shall prescribe in regulations the 

criteria for awarding a grant under the program for activities of an 

institution or organization referred to in subsection (a), including 

the following: 

(1) Whether scientists, engineers, and managers of defense 

laboratories and Department of Energy laboratories are permitted a level of participation in such activities that is beneficial to the development and application of defense critical 

technologies by such laboratories. 

(2) Whether such activities include the placement of 

United States scientists, engineers, and managers in Japanese 

government and industry laboratories— 

(A) to improve the knowledge of such scientists, engineers, and managers in (i) Japanese language and culture, 

and (ii) the research and development and management 

practices of such laboratories; and 

(B) to provide opportunities for the encouragement of 

technology transfer from Japan to the United States. 

(3) Whether an appropriate share of the costs of such activities will be paid out of funds derived from non-Federal Government sources. 

(c) In this section, the term ‘‘defense critical technology’’ means 

a technology that is identified under section 2505 of this title as 

critical for attaining the national security objectives set forth in 

section 2501(a) of this title. 

(Added Pub. L. 102–190, div. A, title VIII, Sec. 828(a), Dec. 5, 1991, 105 Stat. 1444; amended 

Pub. L. 103–35, title II, Sec. 201(c)(3), May 31, 1993, 107 Stat. 98; Pub. L. 105–85, div. A, title 

X, Sec. 1073(a)(39), Nov. 18, 1997, 111 Stat. 1902.) 

§ 2199. Definitions 

In this chapter: 

(1) The term ‘‘defense laboratory’’ means a laboratory operated by the Department of Defense or owned by the Department of Defense and operated by a contractor or a facility of 

a Defense Agency at which research and development activities 

are conducted. 

(2) The term ‘‘institution of higher education’’ has the 

meaning given such term in section 101 of the Higher Education Act of 1965. 

(3) The term ‘‘regional center for the transfer of manufacturing technology’’ means a regional center for the transfer of 

manufacturing technology referred to in section 25(a) of the 

National Institute of Standards and Technology Act (15 U.S.C. 

278k). 

(Added Pub. L. 102–190, div. A, title VIII, Sec. 825(a)(1), Dec. 5, 1991, 105 Stat. 1441; amended 

Pub. L. 105–244, title I, Sec. 102(a)(2)(B), Oct. 7, 1998, 112 Stat. 1617.) 
1064 

CHAPTER 112—INFORMATION SECURITY SCHOLARSHIP 

PROGRAM 

Sec. 

2200. Programs; purpose. 

2200a. Scholarship program. 

2200b. Grant program. 

2200c. Centers of Academic Excellence in Information Assurance Education. 

2200d. Regulations. 

2200e. Definitions. 

2200f. Inapplicability to Coast Guard. 

§ 2200. Programs; purpose 

(a) IN GENERAL.—To encourage the recruitment and retention 

of Department of Defense personnel who have the computer and 

network security skills necessary to meet Department of Defense 

information assurance requirements, the Secretary of Defense may 

carry out programs in accordance with this chapter to provide financial support for education in disciplines relevant to those requirements at institutions of higher education. 

(b) TYPES OF PROGRAMS.—The programs authorized under this 

chapter are as follows: 

(1) Scholarships for pursuit of programs of education in information assurance at institutions of higher education. 

(2) Grants to institutions of higher education. 

(Added Pub. L. 106–398, Sec. 1 [[div. A], title IX, Sec. 922(a)(1)], Oct. 30, 2000, 114 Stat. 1654, 

1654A–233.) 

§ 2200a. Scholarship program 

(a) AUTHORITY.—The Secretary of Defense may, subject to subsection (f), provide financial assistance in accordance with this section to a person— 

(1) who is pursuing an associate, baccalaureate, or advanced degree, or a certification, in an information assurance 

discipline referred to in section 2200(a) of this title at an institution of higher education; and 

(2) who enters into an agreement with the Secretary as described in subsection (b). 

(b) SERVICE AGREEMENT FOR SCHOLARSHIP RECIPIENTS.—(1) To 

receive financial assistance under this section— 

(A) a member of the armed forces shall enter into an 

agreement to serve on active duty in the member’s armed force 

for the period of obligated service determined under paragraph 

(2); 

(B) an employee of the Department of Defense shall enter 

into an agreement to continue in the employment of the department for the period of obligated service determined under 

paragraph (2); and 

(C) a person not referred to in subparagraph (A) or (B) 

shall enter into an agreement— 
1065 § 2200a CH. 112—INFORMATION SECURITY SCHOLARSHIP PROGRAM 

(i) to enlist or accept a commission in one of the armed 

forces and to serve on active duty in that armed force for 

the period of obligated service determined under paragraph (2); or 

(ii) to accept and continue employment in the Department of Defense for the period of obligated service determined under paragraph (2). 

(2) For the purposes of this subsection, the period of obligated 

service for a recipient of financial assistance under this section 

shall be the period determined by the Secretary of Defense as being 

appropriate to obtain adequate service in exchange for the financial 

assistance and otherwise to achieve the goals set forth in section 

2200(a) of this title. In no event may the period of service required 

of a recipient be less than the period equal to three-fourths of the 

total period of pursuit of a degree for which the Secretary agrees 

to provide the recipient with financial assistance under this section. The period of obligated service is in addition to any other period for which the recipient is obligated to serve on active duty or 

in the civil service, as the case may be. 

(3) An agreement entered into under this section by a person 

pursuing an academic degree shall include terms that provide the 

following: 

(A) That the period of obligated service begins on a date 

after the award of the degree that is determined under the regulations prescribed under section 2200d of this title. 

(B) That the person will maintain satisfactory academic 

progress, as determined in accordance with those regulations, 

and that failure to maintain such progress constitutes grounds 

for termination of the financial assistance for the person under 

this section. 

(C) Any other terms and conditions that the Secretary of 

Defense determines appropriate for carrying out this section. 

(c) AMOUNT OF ASSISTANCE.—The amount of the financial assistance provided for a person under this section shall be the 

amount determined by the Secretary of Defense as being necessary 

to pay all educational expenses incurred by that person, including 

tuition, fees, cost of books, laboratory expenses, and expenses of 

room and board. The expenses paid, however, shall be limited to 

those educational expenses normally incurred by students at the 

institution of higher education involved. 

(d) USE OF ASSISTANCE FOR SUPPORT OF INTERNSHIPS.—The financial assistance for a person under this section may also be provided to support internship activities of the person at the Department of Defense in periods between the academic years leading to 

the degree for which assistance is provided the person under this 

section. 

(e) REPAYMENT FOR PERIOD OF UNSERVED OBLIGATED SERVICE.—(1) A member of an armed force who does not complete the 

period of active duty specified in the service agreement under subsection (b) shall be subject to the repayment provisions of section 

303a(e) of title 37. 

(2) A civilian employee of the Department of Defense who voluntarily terminates service before the end of the period of obligated 

service required under an agreement entered into under subsection 
§ 2200b CH. 112—INFORMATION SECURITY SCHOLARSHIP PROGRAM 1066 

(b) shall be subject to the repayment provisions of section 303a(e) 

of title 37 in the same manner and to the same extent as if the 

civilian employee were a member of the armed forces. 

(f) ALLOCATION OF FUNDING.—Not less than 50 percent of the 

amount available for financial assistance under this section for a 

fiscal year shall be available only for providing financial assistance 

for the pursuit of degrees referred to in subsection (a) at institutions of higher education that have established, improved, or are 

administering programs of education in information assurance 

under the grant program established in section 2200b of this title, 

as determined by the Secretary of Defense. 

(g) EMPLOYMENT OF PROGRAM PARTICIPANTS.—The Secretary of 

Defense— 

(1) may, without regard to any provision of title 5 governing appointments in the competitive service, appoint to an 

information technology position in the Department of Defense 

in the excepted service an individual who has successfully completed an academic program for which a scholarship under this 

section was awarded and who, under the terms of the agreement for such scholarship, at the time of such appointment 

owes a service commitment to the Department; and 

(2) may, upon satisfactory completion of two years of substantially continuous service by an incumbent who was appointed to an excepted service position under the authority of 

paragraph (1), convert the appointment of such individual, 

without competition, to a career or career conditional appointment. 

(Added Pub. L. 106–398, Sec. 1 [[div. A], title IX, Sec. 922(a)(1)], Oct. 30, 2000, 114 Stat. 1654, 

1654A–234; amended Pub. L. 109–163, div. A, title VI, Sec. 687(c)(8), Jan. 6, 2006, 119 Stat. 

3334; Pub. L. 111–84, div. A, title X, Sec. 1073(a)(20), title XI, Sec. 1103, Oct. 28, 2009, 123 

Stat. 2473, 2485.) 

§ 2200b. Grant program 

(a) AUTHORITY.—The Secretary of Defense may provide grants 

of financial assistance to institutions of higher education to support 

the establishment, improvement, or administration of programs of 

education in information assurance disciplines referred to in section 2200(a) of this title. 

(b) PURPOSES.—The proceeds of grants under this section may 

be used by an institution of higher education for the following purposes: 

(1) Faculty development. 

(2) Curriculum development. 

(3) Laboratory improvements. 

(4) Faculty research in information security. 

(Added Pub. L. 106–398, Sec. 1 [[div. A], title IX, Sec. 922(a)(1)], Oct. 30, 2000, 114 Stat. 1654, 

1654A–235.) 

§ 2200c. Centers of Academic Excellence in Information Assurance Education 

In the selection of a recipient for the award of a scholarship 

or grant under this chapter, consideration shall be given to whether— 
1067 § 2200f CH. 112—INFORMATION SECURITY SCHOLARSHIP PROGRAM 

(1) in the case of a scholarship, the institution at which 

the recipient pursues a degree is a Center of Academic Excellence in Information Assurance Education; and 

(2) in the case of a grant, the recipient is a Center of Academic Excellence in Information Assurance Education. 

(Added Pub. L. 106–398, Sec. 1 [[div. A], title IX, Sec. 922(a)(1)], Oct. 30, 2000, 114 Stat. 1654, 

1654A–236.) 

§ 2200d. Regulations 

The Secretary of Defense shall prescribe regulations for the administration of this chapter. 

(Added Pub. L. 106–398, Sec. 1 [[div. A], title IX, Sec. 922(a)(1)], Oct. 30, 2000, 114 Stat. 1654, 

1654A–236.) 

§ 2200e. Definitions 

In this chapter: 

(1) The term ‘‘information assurance’’ includes the following: 

(A) Computer security. 

(B) Network security. 

(C) Any other information technology that the Secretary of Defense considers related to information assurance. 

(2) The term ‘‘institution of higher education’’ has the 

meaning given the term in section 101 of the Higher Education 

Act of 1965 (20 U.S.C. 1001). 

(3) The term ‘‘Center of Academic Excellence in Information Assurance Education’’ means an institution of higher education that is designated by the Director of the National Security Agency as a Center of Academic Excellence in Information 

Assurance Education. 

(Added Pub. L. 106–398, Sec. 1 [[div. A], title IX, Sec. 922(a)(1)], Oct. 30, 2000, 114 Stat. 1654, 

1654A–236.) 

§ 2200f. Inapplicability to Coast Guard 

This chapter does not apply to the Coast Guard when it is not 

operating as a service in the Navy. 

(Added Pub. L. 106–398, Sec. 1 [[div. A], title IX, Sec. 922(a)(1)], Oct. 30, 2000, 114 Stat. 1654, 

1654A–236.) 

1069 

PART IV—SERVICE, SUPPLY, AND 

PROCUREMENT 

Chap. Sec.

131. Planning and Coordination ............................................ 2201

133. Facilities for Reserve Components ................................ 2231

134. Miscellaneous Administrative Provisions ..................... 2241

135. Space Programs ............................................................... 2271

136. Provisions Relating to Specific Programs ..................... 2281

137. Procurement Generally ................................................... 2301

138. Cooperative Agreements with NATO Allies and Other 

Countries ...................................................................... 2341

139. Research and Development ............................................ 2351

140. Procurement of Commercial Items ................................ 2375

141. Miscellaneous Procurement Provisions ......................... 2381

142. Procurement Technical Assistance Cooperative Agreement Program .............................................................. 2411

143. Production by Military Agencies .................................... 2421

144. Major Defense Acquisition Programs ............................ 2430

144A. Major Automated Information System Programs ........ 2445a 

145. Cataloging and Standardization .................................... 2451

146. Contracting for Performance of Civilian Commercial 

or Industrial Type Functions ..................................... 2460

147. Commissaries and Exchanges and Other Morale, Welfare, and Recreation Activities ................................... 2481

148. National Defense Technology and Industrial Base, 

Defense Reinvestment, and Defense Conversion ...... 2500

149. Defense Acquisition System ........................................... 2545

[150. Repealed.] 

152. Issue of Supplies, Services, and Facilities .................... 2551

153. Exchange of Material and Disposal of Obsolete, Surplus, or Unclaimed Property ...................................... 2571

155. Acceptance of Gifts and Services ................................... 2601

157. Transportation ................................................................ 2631

159. Real Property; Related Personal Property; and Lease 

of Non-Excess Property ............................................... 2661

160. Environmental Restoration ............................................ 2700

161. Property Records and Report of Theft or Loss of Certain Property ................................................................ 2721

163. Military Claims ............................................................... 2731

165. Accountability and Responsibility ................................. 2771

[167. Repealed.] 

169. Military Construction and Military Family Housing ... 2801

[171. Repealed.] 

172. Strategic Environmental Research and Development 

Program ........................................................................ 2901

173. Energy Security ............................................................... 2911

1071 

CHAPTER 131—PLANNING AND COORDINATION 

Sec. 

2201. Apportionment of funds: authority for exemption; excepted expenses. 

2202. Regulations on procurement, production, warehousing, and supply distribution functions. 

2203. Budget estimates. 

2204. Obligation of appropriations. 

2205. Reimbursements. 

2206. Disbursement of funds of military department to cover obligation of another agency of Department of Defense. 

2207. Expenditure of appropriations: limitation. 

2208. Working-capital funds. 

2209. Management funds. 

2210. Proceeds of sales of supplies: credit to appropriations. 

2211. Reimbursement for equipment, material, or services furnished members of 

the United Nations. 

2212. Obligations for contract services: reporting in budget object classes. 

2213. Limitation on acquisition of excess supplies. 

2214. Transfer of funds: procedure and limitations. 

2215. Transfer of funds to other departments and agencies: limitation. 

2216. Defense Modernization Account. 

[2216a. Repealed.] 

2217. Comparable budgeting for common procurement weapon systems. 

2218. National Defense Sealift Fund. 

[2219. Renumbered.] 

2220. Performance based management: acquisition programs. 

[2221. Repealed.] 

2222. Defense business systems: architecture, accountability, and modernization. 

2223. Information technology: additional responsibilities of Chief Information Officers. 

2223a. Information technology acquisition planning and oversight requirements. 

2224. Defense Information Assurance Program. 

2224a. Information security: continued applicability of expiring Governmentwide 

requirements to the Department of Defense. 

2225. Information technology purchases: tracking and management. 

2226. Contracted property and services: prompt payment of vouchers. 

2227. Electronic submission and processing of claims for contract payments. 

2228. Office of Corrosion Policy and Oversight. 

2229. Strategic policy on prepositioning of materiel and equipment. 

2229a. Annual report on prepositioned materiel and equipment. 

§ 2201. Apportionment of funds: authority for exemption; excepted expenses 

(a) EXEMPTION FROM APPORTIONMENT REQUIREMENT.—If the 

President determines such action to be necessary in the interest of 

national defense, the President may exempt from the provisions of 

section 1512 of title 31 appropriations, funds, and contract authorizations available for military functions of the Department of Defense. 

(b) AIRBORNE ALERTS.—Upon a determination by the President 

that such action is necessary, the Secretary of Defense may provide 

for the cost of an airborne alert as an excepted expense under section 6301(a) and (b)(1)–(3) of title 41. 

(c) MEMBERS ON ACTIVE DUTY.—Upon a determination by the 

President that it is necessary to increase (subject to limits imposed 
§ 2202 CH. 131—PLANNING AND COORDINATION 1072 

by law) the number of members of the armed forces on active duty 

beyond the number for which funds are provided in appropriation 

Acts for the Department of Defense, the Secretary of Defense may 

provide for the cost of such additional members as an excepted expense under section 6301(a) and (b)(1)–(3) of title 41. 

(d) NOTIFICATION TO CONGRESS.—The Secretary of Defense 

shall immediately notify Congress of the use of any authority under 

this section. 

(Added Pub. L. 100–370, Sec. 1(d)(1)(A), July 19, 1988, 102 Stat. 841; amended Pub. L. 106– 

65, div. A, title X, Sec. 1032(a)(1), Oct. 5, 1999, 113 Stat. 751; Pub. L. 111–350, Sec. 5(b)(4), 

Jan. 4, 2011, 124 Stat. 3842.) 

§ 2202. Regulations on procurement, production, warehousing, and supply distribution functions 

The Secretary of Defense shall prescribe regulations governing 

the performance within the Department of Defense of the procurement, production, warehousing, and supply distribution functions, 

and related functions, of the Department of Defense. 

(Aug. 10, 1956, ch. 1041, 70A Stat. 120; Pub. L. 100–180, div. A, title XII, Sec. 1202, Dec. 4, 

1987, 101 Stat. 1153; Pub. L. 103–355, title III, Sec. 3061(a), Oct. 13, 1994, 108 Stat. 3336.) 

§ 2203. Budget estimates 

To account for, and report, the cost of performance of readily 

identifiable functional programs and activities, with segregation of 

operating and capital programs, budget estimates of the Department of Defense shall be prepared, presented, and justified, where 

practicable, and authorized programs shall be administered, in 

such form and manner as the Secretary of Defense, subject to the 

authority and direction of the President, may prescribe. As far as 

practicable, budget estimates and authorized programs of the military departments shall be uniform and in readily comparable form. 

The budget for the Department of Defense submitted to Congress 

for each fiscal year shall include data projecting the effect of the 

appropriations requested for materiel readiness requirements. The 

Secretary of Defense shall provide that the budget justification documents for such budget include information on the number of employees of contractors estimated to be working on contracts of the 

Department of Defense during the fiscal year for which the budget 

is submitted. Such information shall be set forth in terms of employee-years or such other measure as will be uniform and readily 

comparable with civilian personnel of the Department of Defense. 

(Added Pub. L. 87–651, title II, Sec. 207(a), Sept. 7, 1962, 76 Stat. 520; amended Pub. L. 97– 

295, Sec. 1(21), Oct. 12, 1982, 96 Stat. 1290; Pub. L. 99–661, div. A, title III, Sec. 311, Nov. 

14, 1986, 100 Stat. 3851.) 

§ 2204. Obligation of appropriations 

To prevent overdrafts and deficiencies in the fiscal year for 

which appropriations are made, appropriations made to the Department of Defense or to a military department, and reimbursements thereto, are available for obligation and expenditure only 

under scheduled rates of obligation, or changes thereto, that have 

been approved by the Secretary of Defense. This section does not 

prohibit the Department of Defense from incurring a deficiency 

that it has been authorized by law to incur. 

(Added Pub. L. 87–651, title II, Sec. 207(a), Sept. 7, 1962, 76 Stat. 520.) 
1073 § 2207 CH. 131—PLANNING AND COORDINATION 

§ 2205. Reimbursements 

(a) AVAILABILITY OF REIMBURSEMENTS.—Reimbursements 

made to appropriations of the Department of Defense or a department or agency thereof under sections 1535 and 1536 of title 31, 

or other amounts paid by or on behalf of a department or agency 

of the Department of Defense to another department or agency of 

the Department of Defense, or by or on behalf of personnel of any 

department or organization, for services rendered or supplies furnished, may be credited to authorized accounts. Funds so credited 

are available for obligation for the same period as the funds in the 

account so credited. Such an account shall be accounted for as one 

fund on the books of the Department of the Treasury. 

(b) FIXED RATE FOR REIMBURSEMENT FOR CERTAIN SERVICES.— 

The Secretary of Defense and the Secretaries of the military departments may charge a fixed rate for reimbursement of the costs 

of providing planning, supervision, administrative, or overhead 

services incident to any construction, maintenance, or repair 

project to real property or for providing facility services, irrespective of the appropriation financing the project or facility services. 

(Added Pub. L. 87–651, title II, Sec. 207(a), Sept. 7, 1962, 76 Stat. 520; amended Pub. L. 96– 

513, title V, Sec. 511(71), Dec. 12, 1980, 94 Stat. 2926; Pub. L. 97–258, Sec. 3(b)(4), Sept. 13, 

1982, 96 Stat. 1063; Pub. L. 103–337, div. B, title XXVIII, Sec. 2804(a), (b)(1), Oct. 5, 1994, 108 

Stat. 3053.) 

§ 2206. Disbursement of funds of military department to 

cover obligation of another agency of Department 

of Defense 

As far as authorized by the Secretary of Defense, a disbursing 

official of a military department may, out of available advances, 

make disbursements to cover obligations in connection with any 

function, power, or duty of another department or agency of the Department of Defense and charge those disbursements on vouchers, 

to the appropriate appropriation of that department or agency. Disbursements so made shall be adjusted in settling the accounts of 

the disbursing official. 

(Added Pub. L. 87–651, title II, Sec. 207(a), Sept. 7, 1962, 76 Stat. 520; amended Pub. L. 97– 

258, Sec. 2(b)(1)(A), Sept. 13, 1982, 96 Stat. 1052.) 

§ 2207. Expenditure of appropriations: limitation 

(a) Money appropriated to the Department of Defense may not 

be spent under a contract other than a contract for personal services unless that contract provides that— 

(1) the United States may, by written notice to the contractor, terminate the right of the contractor to proceed under 

the contract if the Secretary concerned or his designee finds, 

after notice and hearing, that the contractor, or his agent or 

other representative, offered or gave any gratuity, such as entertainment or a gift, to an officer, official, or employee of the 

United States to obtain a contract or favorable treatment in 

the awarding, amending, or making of determinations concerning the performance, of a contract; and 

(2) if a contract is terminated under clause (1), the United 

States has the same remedies against the contractor that it 

would have had if the contractor had breached the contract 
§ 2208 CH. 131—PLANNING AND COORDINATION 1074 

and, in addition to other damages, is entitled to exemplary 

damages in an amount at least three, but not more than 10, 

as determined by the Secretary or his designee, times the cost 

incurred by the contractor in giving gratuities to the officer, official, or employee concerned. 

The existence of facts upon which the Secretary makes findings 

under clause (1) may be reviewed by any competent court. 

(b) This section does not apply to a contract that is for an 

amount not greater than the simplified acquisition threshold (as 

defined in section 134 of title 41. 

(Added Pub. L. 87–651, title II, Sec. 207(a), Sept. 7, 1962, 76 Stat. 520; amended Pub. L. 104– 

106, div. A, title VIII, Sec. 801, Feb. 10, 1996, 110 Stat. 389; Pub. L. 111–350, Sec. 5(b)(5), Jan. 

4, 2011, 124 Stat. 3842.) 

§ 2208. Working-capital funds 

(a) To control and account more effectively for the cost of programs and work performed in the Department of Defense, the Secretary of Defense may require the establishment of working-capital 

funds in the Department of Defense to— 

(1) finance inventories of such supplies as he may designate; and 

(2) provide working capital for such industrial-type activities, and such commercial-type activities that provide common 

services within or among departments and agencies of the Department of Defense, as he may designate. 

(b) Upon the request of the Secretary of Defense, the Secretary 

of the Treasury shall establish working-capital funds established 

under this section on the books of the Department of the Treasury. 

(c) Working-capital funds shall be charged, when appropriate, 

with the cost of— 

(1) supplies that are procured or otherwise acquired, manufactured, repaired, issued, or used, including the cost of the 

procurement and qualification of technology-enhanced maintenance capabilities that improve either reliability, maintainability, sustainability, or supportability and have, at a minimum, been demonstrated to be functional in an actual system 

application or operational environment; and 

(2) services or work performed; 

including applicable administrative expenses, and be reimbursed 

from available appropriations or otherwise credited for those costs, 

including applicable administrative expenses and costs of using 

equipment. 

(d) The Secretary of Defense may provide capital for workingcapital funds by capitalizing inventories. In addition, such amounts 

may be appropriated for the purpose of providing capital for working-capital funds as have been specifically authorized by law. 

(e) Subject to the authority and direction of the Secretary of 

Defense, the Secretary of each military department shall allocate 

responsibility for its functions, powers, and duties to accomplish 

the most economical and efficient organization and operation of the 

activities, and the most economical and efficient use of the inventories, for which working-capital funds are authorized by this section. 
1075 § 2208 CH. 131—PLANNING AND COORDINATION 

(f) The requisitioning agency may not incur a cost for supplies 

drawn from inventories, or services or work performed by industrial-type or commercial-type activities for which working-capital 

funds may be established under this section, that is more than the 

amount of appropriations or other funds available for those purposes. 

(g) The appraised value of supplies returned to working-capital 

funds by a department, activity, or agency may be charged to that 

fund. The proceeds thereof shall be credited to current applicable 

appropriations and are available for expenditure for the same purposes that those appropriations are so available. Credits may not 

be made to appropriations under this subsection as the result of 

capitalization of inventories under subsection (d). 

(h) The Secretary of Defense shall prescribe regulations governing the operation of activities and use of inventories authorized 

by this section. The regulations may, if the needs of the Department of Defense require it and it is otherwise authorized by law, 

authorize supplies to be sold to, or services to be rendered or work 

performed for, persons outside the Department of Defense. However, supplies available in inventories financed by working capital 

funds established under this section may be sold to contractors for 

use in performing contracts with the Department of Defense. Working-capital funds shall be reimbursed for supplies so sold, services 

so rendered, or work so performed by charges to applicable appropriations or payments received in cash. 

(i) For provisions relating to sales outside the Department of 

Defense of manufactured articles and services by a working-capital 

funded Army industrial facility (including a Department of the 

Army arsenal) that manufactures large caliber cannons, gun 

mounts, recoil mechanisms, ammunition, munitions, or components 

thereof, see section 4543 of this title. 

(j)(1) The Secretary of a military department may authorize a 

working capital funded industrial facility of that department to 

manufacture or remanufacture articles and sell these articles, as 

well as manufacturing, remanufacturing, and engineering services 

provided by such facilities, to persons outside the Department of 

Defense if— 

(A) the person purchasing the article or service is fulfilling 

a Department of Defense contract or a subcontract under a Department of Defense contract, and the solicitation for the contract or subcontract is open to competition between Department of Defense activities and private firms; or 

(B) the Secretary would advance the objectives set forth in 

section 2474(b)(2) of this title by authorizing the facility to do 

so. 

(2) The Secretary of Defense may waive the conditions in paragraph (1) in the case of a particular sale if the Secretary determines that the waiver is necessary for reasons of national security 

and notifies Congress regarding the reasons for the waiver. 

(k)(1) Subject to paragraph (2), a contract for the procurement 

of a capital asset financed by a working-capital fund may be awarded in advance of the availability of funds in the working-capital 

fund for the procurement. 
§ 2208 CH. 131—PLANNING AND COORDINATION 1076 

(2) Paragraph (1) applies to any of the following capital assets 

that have a development or acquisition cost of not less than 

$250,000: 

(A) An unspecified minor military construction project 

under section 2805(c)(1) of this title. 

(B) Automatic data processing equipment or software. 

(C) Any other equipment. 

(D) Any other capital improvement. 

(l)(1) An advance billing of a customer of a working-capital 

fund may be made if the Secretary of the military department concerned submits to Congress written notification of the advance billing within 30 days after the end of the month in which the advanced billing was made. The notification shall include the following: 

(A) The reasons for the advance billing. 

(B) An analysis of the effects of the advance billing on 

military readiness. 

(C) An analysis of the effects of the advance billing on the 

customer. 

(2) The Secretary of Defense may waive the notification requirements of paragraph (1)— 

(A) during a period of war or national emergency; or 

(B) to the extent that the Secretary determines necessary 

to support a contingency operation. 

(3) The total amount of the advance billings rendered or imposed for all working-capital funds of the Department of Defense 

in a fiscal year may not exceed $1,000,000,000. 

(4) In this subsection: 

(A) The term ‘‘advance billing’’, with respect to a workingcapital fund, means a billing of a customer by the fund, or a 

requirement for a customer to reimburse or otherwise credit 

the fund, for the cost of goods or services provided (or for other 

expenses incurred) on behalf of the customer that is rendered 

or imposed before the customer receives the goods or before the 

services have been performed. 

(B) The term ‘‘customer’’ means a requisitioning component or agency. 

(m) CAPITAL ASSET SUBACCOUNTS.—Amounts charged for depreciation of capital assets shall be credited to a separate capital 

asset subaccount established within a working-capital fund. 

(n) SEPARATE ACCOUNTING, REPORTING, AND AUDITING OF

FUNDS AND ACTIVITIES.—The Secretary of Defense, with respect to 

the working-capital funds of each Defense Agency, and the Secretary of each military department, with respect to the workingcapital funds of the military department, shall provide for separate 

accounting, reporting, and auditing of funds and activities managed 

through the working-capital funds. 

(o) CHARGES FOR GOODS AND SERVICES PROVIDED THROUGH

THE FUND.—(1) Charges for goods and services provided for an activity through a working-capital fund shall include the following: 

(A) Amounts necessary to recover the full costs of the 

goods and services provided for that activity. 

(B) Amounts for depreciation of capital assets, set in accordance with generally accepted accounting principles. 
1077 § 2208 CH. 131—PLANNING AND COORDINATION 

(2) Charges for goods and services provided through a workingcapital fund may not include the following: 

(A) Amounts necessary to recover the costs of a military 

construction project (as defined in section 2801(b) of this title), 

other than a minor construction project financed by the fund 

pursuant to section 2805(c)(1) of this title. 

(B) Amounts necessary to cover costs incurred in connection with the closure or realignment of a military installation. 

(C) Amounts necessary to recover the costs of functions 

designated by the Secretary of Defense as mission critical, such 

as ammunition handling safety, and amounts for ancillary 

tasks not directly related to the mission of the function or activity managed through the fund. 

(p) PROCEDURES FOR ACCUMULATION OF FUNDS.—The Secretary of Defense, with respect to each working-capital fund of a 

Defense Agency, and the Secretary of a military department, with 

respect to each working-capital fund of the military department, 

shall establish billing procedures to ensure that the balance in that 

working-capital fund does not exceed the amount necessary to provide for the working-capital requirements of that fund, as determined by the Secretary. 

(q) ANNUAL REPORTS AND BUDGET.—The Secretary of Defense, 

with respect to each working-capital fund of a Defense Agency, and 

the Secretary of each military department, with respect to each 

working-capital fund of the military department, shall annually 

submit to Congress, at the same time that the President submits 

the budget under section 1105 of title 31, the following: 

(1) A detailed report that contains a statement of all receipts and disbursements of the fund (including such a statement for each subaccount of the fund) for the fiscal year ending 

in the year preceding the year in which the budget is submitted. 

(2) A detailed proposed budget for the operation of the 

fund for the fiscal year for which the budget is submitted. 

(3) A comparison of the amounts actually expended for the 

operation of the fund for the fiscal year referred to in paragraph (1) with the amount proposed for the operation of the 

fund for that fiscal year in the President’s budget. 

(4) A report on the capital asset subaccount of the fund 

that contains the following information: 

(A) The opening balance of the subaccount as of the 

beginning of the fiscal year in which the report is submitted. 

(B) The estimated amounts to be credited to the subaccount in the fiscal year in which the report is submitted. 

(C) The estimated amounts of outlays to be paid out 

of the subaccount in the fiscal year in which the report is 

submitted. 

(D) The estimated balance of the subaccount at the 

end of the fiscal year in which the report is submitted. 

(E) A statement of how much of the estimated balance 

at the end of the fiscal year in which the report is submitted will be needed to pay outlays in the immediately 

following fiscal year that are in excess of the amount to be 
§ 2209 CH. 131—PLANNING AND COORDINATION 1078 

credited to the subaccount in the immediately following 

fiscal year. 

(r) NOTIFICATION OF TRANSFERS.—(1) Notwithstanding any authority provided in this section to transfer funds, the transfer of 

funds from a working-capital fund, including a transfer to another 

working-capital fund, shall not be made under such authority unless the Secretary of Defense submits, in advance, a notification of 

the proposed transfer to the congressional defense committees in 

accordance with customary procedures. 

(2) The amount of a transfer covered by a notification under 

paragraph (1) that is made in a fiscal year does not count toward 

any limitation on the total amount of transfers that may be made 

for that fiscal year under authority provided to the Secretary of Defense in a law authorizing appropriations for a fiscal year for military activities of the Department of Defense or a law making appropriations for the Department of Defense. 

(Added Pub. L. 87–651, title II, Sec. 207(a), Sept. 7, 1962, 76 Stat. 521; amended Pub. L. 97– 

295, Sec. 1(22), Oct. 12, 1982, 96 Stat. 1290; Pub. L. 98–94, title XII, Sec. 1204(a), Sept. 24, 

1983, 97 Stat. 683; Pub. L. 98–525, title III, Sec. 305, Oct. 19, 1984, 98 Stat. 2513; Pub. L. 100– 

26, Sec. 7(d)(2), Apr. 21, 1987, 101 Stat. 280; Pub. L. 101–510, div. A, title VIII, Sec. 801, title 

XIII, Sec. 1301(6), Nov. 5, 1990, 104 Stat. 1588, 1668; Pub. L. 102–172, title VIII, Sec. 8137, 

Nov. 26, 1991, 105 Stat. 1212; Pub. L. 102–484, div. A, title III, Sec. 374, Oct. 23, 1992, 106 

Stat. 2385; Pub. L. 103–160, div. A, title I, Sec. 158(b), Nov. 30, 1993, 107 Stat. 1582; Pub. L. 

105–85, div. A, title X, Sec. 1011(a), (b), Nov. 18, 1997, 111 Stat. 1873; Pub. L. 105–261, div. 

A, title X, Sec. 1007(e)(1), 1008(a), Oct. 17, 1998, 112 Stat. 2115; Pub. L. 105–262, title VIII, 

Sec. 8146(d)(1), Oct. 17, 1998, 112 Stat. 2340; Pub. L. 106–65, div. A, title III, Sec. 331(a)(1), 

332, title X, Sec. 1066(a)(16), Oct. 5, 1999, 113 Stat. 566, 567, 771; Pub. L. 106–398, Sec. 1 [[div. 

A], title III, Sec. 341(f)], Oct. 30, 2000, 114 Stat. 1654, 1654A–64; Pub. L. 108–375, div. A, title 

X, Sec. 1009, Oct. 28, 2004, 118 Stat. 2037; Pub. L. 111–383, div. A, title XIV, Sec. 1403, Jan. 

7, 2011, 124 Stat. 4410.) 

§ 2209. Management funds 

(a) To conduct economically and efficiently the operations of 

the Department of Defense that are financed by at least two appropriations but whose costs cannot be immediately distributed and 

charged to those appropriations, there is the Army Management 

Fund, the Navy Management Fund, and the Air Force Management Fund, each within its respective department and under the 

direction of the Secretary of that department. Each such fund shall 

consist of a corpus of $1,000,000 and such amounts as may be appropriated thereto from time to time. An account for an operation 

that is to be financed by such a fund may be established only with 

the approval of the Secretary of Defense. 

(b) Under such regulations as the Secretary of Defense may 

prescribe, expenditures may be made from a management fund for 

material (other than for stock), personal services, and services 

under contract. However, obligation may not be incurred against 

that fund if it is not chargeable to funds available under an appropriation of the department concerned or funds of another department or agency of the Department of Defense. The fund shall be 

promptly reimbursed from those funds for expenditures made from 

it. 

(c) Notwithstanding any other provision of law, advances, by 

check or warrant, or reimbursements, may be made from available 

appropriations to a management fund on the basis of the estimated 

cost of a project. As adequate data becomes available, the estimated cost shall be revised and necessary adjustments made. Final 

adjustment shall be made with the appropriate funds for the fiscal 
1079 § 2212 CH. 131—PLANNING AND COORDINATION 

year in which the advances or reimbursements are made. Except 

as otherwise provided by law, amounts advanced to management 

funds are available for obligation only during the fiscal year in 

which they are advanced. 

(Added Pub. L. 87–651, title II, Sec. 207(a), Sept. 7, 1962, 76 Stat. 522.) 

§ 2210. Proceeds of sales of supplies: credit to appropriations 

(a)(1) A working-capital fund established pursuant to section 

2208 of this title may retain so much of the proceeds of disposals 

of property referred to in paragraph (2) as is necessary to recover 

the expenses incurred by the fund in disposing of such property. 

Proceeds from the sale or disposal of such property in excess of 

amounts necessary to recover the expenses may be credited to current applicable appropriations of the Department of Defense. 

(2) Paragraph (1) applies to disposals of supplies, material, 

equipment, and other personal property that were not financed by 

stock funds established under section 2208 of this title. 

(b) Obligations may, without regard to fiscal year limitations, 

be incurred against anticipated reimbursements to stock funds in 

such amounts and for such period as the Secretary of Defense, with 

the approval of the President, may determine to be necessary to 

maintain stock levels consistently with planned operations for the 

next fiscal year. 

(Added Pub. L. 87–651, title II, Sec. 207(a), Sept. 7, 1962, 76 Stat. 522; amended Pub. L. 96– 

513, title V, Sec. 511(72), Dec. 12, 1980, 94 Stat. 2926; Pub. L. 105–261, div. A, title X, Sec. 

1009, Oct. 17, 1998, 112 Stat. 2117.) 

§ 2211. Reimbursement for equipment, material, or services 

furnished members of the United Nations 

Amounts paid by members of the United Nations for equipment or materials furnished, or services performed, in joint military operations shall be credited to appropriate appropriations of 

the Department of Defense in the manner authorized by section 

632(d) of the Foreign Assistance Act of 1961 (22 U.S.C. 2392(d)). 

(Added Pub. L. 87–651, title II, Sec. 207(a), Sept. 7, 1962, 76 Stat. 522; amended Pub. L. 96– 

513, title V, Sec. 511(73), Dec. 12, 1980, 94 Stat. 2926.) 

§ 2212. Obligations for contract services: reporting in 

budget object classes 

(a) LIMITATION ON REPORTING IN MISCELLANEOUS SERVICES

OBJECT CLASS.—The Secretary of Defense shall ensure that, in reporting to the Office of Management and Budget (pursuant to OMB 

Circular A–11 (relating to preparation and submission of budget estimates)) obligations of the Department of Defense for any period 

of time for contract services, no more than 15 percent of the total 

amount of obligations so reported is reported in the miscellaneous 

services object class. 

(b) DEFINITION OF REPORTING CATEGORIES FOR ADVISORY AND

ASSISTANCE SERVICES.—In carrying out section 1105(g) of title 31 

for the Department of Defense (and in determining what services 

are to be reported to the Office of Management and Budget in the 

advisory and assistance services object class), the Secretary of Defense shall apply to the terms used for the definition of ‘‘advisory 
§ 2212 CH. 131—PLANNING AND COORDINATION 1080 

and assistance services’’ in paragraph (2)(A) of that section the following meanings (subject to the authorized exemptions): 

(1) MANAGEMENT AND PROFESSIONAL SUPPORT SERVICES.— The term ‘‘management and professional support services’’ 

(used in clause (i) of section 1105(g)(2)(A) of title 31) means 

services that provide engineering or technical support, assistance, advice, or training for the efficient and effective management and operation of organizations, activities, or systems. 

Those services— 

(A) are closely related to the basic responsibilities and 

mission of the using organization; and 

(B) include efforts that support or contribute to improved organization or program management, logistics 

management, project monitoring and reporting, data collection, budgeting, accounting, auditing, and administrative or technical support for conferences and training programs. 

(2) STUDIES, ANALYSES, AND EVALUATIONS.—The term 

‘‘studies, analyses, and evaluations’’ (used in clause (ii) of section 1105(g)(2)(A) of title 31) means services that provide organized, analytic assessments to understand or evaluate complex 

issues to improve policy development, decisionmaking, management, or administration and that result in documents containing data or leading to conclusions or recommendations. 

Those services may include databases, models, methodologies, 

and related software created in support of a study, analysis, or 

evaluation. 

(3) ENGINEERING AND TECHNICAL SERVICES.—The term ‘‘engineering and technical services’’ (used in clause (iii) of section 

1105(g)(2)(A) of title 31) means services that take the form of 

advice, assistance, training, or hands-on training necessary to 

maintain and operate fielded weapon systems, equipment, and 

components (including software when applicable) at design or 

required levels of effectiveness. 

(c) PROPER CLASSIFICATION OF ADVISORY AND ASSISTANCE

SERVICES.—Before the submission to the Office of Management and 

Budget of the proposed Department of Defense budget for inclusion 

in the President’s budget for a fiscal year pursuant to section 1105 

of title 31, the Secretary of Defense, acting through the Under Secretary of Defense (Comptroller), shall conduct a review of Department of Defense services expected to be performed as contract services during the fiscal year for which that budget is to be submitted 

in order to ensure that those services that are advisory and assistance services (as defined in accordance with subsection (b)) are in 

fact properly classified, in accordance with that subsection, in the 

advisory and assistance services object class. 

(d) REPORT TO CONGRESS.—The Secretary shall submit to Congress each year, not later than 30 days after the date on which the 

budget for the next fiscal year is submitted pursuant to section 

1105 of title 31, a report containing the information derived from 

the review under subsection (c). 

(e) ASSESSMENT BY COMPTROLLER GENERAL.—(1) The Comptroller General shall conduct a review of the report of the Secretary 

of Defense under subsection (d) each year and shall— 
1081 § 2213 CH. 131—PLANNING AND COORDINATION 

(A) assess the methodology used by the Secretary in obtaining the information submitted to Congress in that report; 

and 

(B) assess the information submitted to Congress in that 

report. 

(2) Not later than 120 days after the date on which the Secretary submits to Congress the report required under subsection (d) 

for any year, the Comptroller General shall submit to Congress the 

Comptroller General’s report containing the results of the review 

for that year under paragraph (1). 

(f) DEFINITIONS.—In this section: 

(1) The term ‘‘contract services’’ means all services that are 

reported to the Office of Management and Budget pursuant to 

OMB Circular A–11 (relating to preparation and submission of 

budget estimates) in budget object classes that are designated 

in the Object Class 25 series. 

(2) The term ‘‘advisory and assistance services object class’’ 

means those contract services constituting the budget object 

class that is denominated ‘‘Advisory and Assistance Service’’ 

and designated (as of October 17, 1998) as Object Class 25.1 

(or any similar object class established after October 17, 1998, 

for the reporting of obligations for advisory and assistance contract services). 

(3) The term ‘‘miscellaneous services object class’’ means 

those contract services constituting the budget object class that 

is denominated ‘‘Other Services (services not otherwise specified in the 25 series)’’ and designated (as of October 17, 1998) 

as Object Class 25.2 (or any similar object class established 

after October 17, 1998, for the reporting of obligations for miscellaneous or unspecified contract services). 

(4) The term ‘‘authorized exemptions’’ means those exemptions authorized (as of October 17, 1998) under Department of 

Defense Directive 4205.2, captioned ‘‘Acquiring and Managing 

Contracted Advisory and Assistance Services (CAAS)’’ and 

issued by the Under Secretary of Defense for Acquisition and 

Technology on February 10, 1992, such exemptions being set 

forth in Enclosure 3 to that directive (captioned ‘‘CAAS Exemptions’’). 

(Added Pub. L. 105–261, div. A, title IX, Sec. 911(a)(1), Oct. 17, 1998, 112 Stat. 2097; amended 

Pub. L. 106–65, div. A, title X, Sec. 1066(a)(17), Oct. 5, 1999, 113 Stat. 771.) 

§ 2213. Limitation on acquisition of excess supplies 

(a) TWO-YEAR SUPPLY.—The Secretary of Defense may not 

incur any obligation against a stock fund of the Department of Defense for the acquisition of any item of supply if that acquisition 

is likely to result in an on-hand inventory (excluding war reserves) 

of that item of supply in excess of two years of operating stocks. 

(b) EXCEPTIONS.—The head of a procuring activity may authorize the acquisition of an item of supply in excess of the limitation 

contained in subsection (a) if that activity head determines in writing— 

(1) that the acquisition is necessary to achieve an economical order quantity and will not result in an on-hand inventory 

(excluding war reserves) in excess of three years of operating 
§ 2214 CH. 131—PLANNING AND COORDINATION 1082 

stocks and that the need for the item is unlikely to decline during the period for which the acquisition is made; or 

(2) that the acquisition is necessary for purposes of maintaining the industrial base or for other reasons of national 

security. 

(Added Pub. L. 102–190, div. A, title III, Sec. 317(a), Dec. 5, 1991, 105 Stat. 1338.) 

§ 2214. Transfer of funds: procedure and limitations 

(a) PROCEDURE FOR TRANSFER OF FUNDS.—Whenever authority 

is provided in an appropriation Act to transfer amounts in working 

capital funds or to transfer amounts provided in appropriation Acts 

for military functions of the Department of Defense (other than 

military construction) between such funds or appropriations (or any 

subdivision thereof), amounts transferred under such authority 

shall be merged with and be available for the same purposes and 

for the same time period as the fund or appropriations to which 

transferred. 

(b) LIMITATIONS ON PROGRAMS FOR WHICH AUTHORITY MAY BE

USED.—Such authority to transfer amounts— 

(1) may not be used except to provide funds for a higher 

priority item, based on unforeseen military requirements, than 

the items for which the funds were originally appropriated; 

and 

(2) may not be used if the item to which the funds would 

be transferred is an item for which Congress has denied funds. 

(c) NOTICE TO CONGRESS.—The Secretary of Defense shall 

promptly notify the Congress of each transfer made under such authority to transfer amounts. 

(d) LIMITATIONS ON REQUESTS TO CONGRESS FOR

REPROGRAMMINGS.—Neither the Secretary of Defense nor the Secretary of a military department may prepare or present to the Congress, or to any committee of either House of the Congress, a request with respect to a reprogramming of funds— 

(1) unless the funds to be transferred are to be used for a 

higher priority item, based on unforeseen military requirements, than the item for which the funds were originally appropriated; or 

(2) if the request would be for authority to reprogram 

amounts to an item for which the Congress has denied funds. 

(Added Pub. L. 101–510, div. A, title XIV, Sec. 1482(c)(1), Nov. 5, 1990, 104 Stat. 1709.) 

§ 2215. Transfer of funds to other departments and agencies: 

limitation 

Funds available for military functions of the Department of 

Defense may not be made available to any other department or 

agency of the Federal Government pursuant to a provision of law 

enacted after November 29, 1989, unless, not less than 30 days before such funds are made available to such other department or 

agency, the Secretary of Defense submits to the congressional defense committees a certification that making those funds available 

to such other department or agency is in the national security interest of the United States. 

(Added Pub. L. 103–160, div. A, title XI, Sec. 1106(a)(1), Nov. 30, 1993, 107 Stat. 1750; amended 

Pub. L. 104–106, div. A, title XV, Sec. 1502(a)(14), Feb. 10, 1996, 110 Stat. 503; Pub. L. 106– 
1083 § 2216 CH. 131—PLANNING AND COORDINATION 

65, div. A, title X, Sec. 1067(1), Oct. 5, 1999, 113 Stat. 774; Pub. L. 108–375, div. A, title X, 

Sec. 1084(b)(1), Oct. 28, 2004, 118 Stat. 2060.) 

§ 2216. Defense Modernization Account 

(a) ESTABLISHMENT.—There is established in the Treasury an 

account to be known as the ‘‘Defense Modernization Account’’. 

(b) FUNDS AVAILABLE FOR ACCOUNT.—The Defense Modernization Account shall consist of the following: 

(1) Amounts appropriated to the Defense Modernization 

Account for the costs of commencing projects described in subsection (d)(1), and amounts reimbursed to the Defense Modernization Account under subsection (c)(1)(B)(iii) out of savings 

derived from such projects. 

(2) Amounts transferred to the Defense Modernization Account under subsection (c). 

(c) TRANSFERS TO ACCOUNT.—(1)(A) Upon a determination by 

the Secretary of a military department or the Secretary of Defense 

with respect to Defense-wide appropriations accounts of the availability and source of funds described in subparagraph (B), that Secretary may transfer to the Defense Modernization Account during 

any fiscal year any amount of funds available to the Secretary described in that subparagraph. Such funds may be transferred to 

that account only after the Secretary concerned notifies the congressional defense committees in writing of the amount and source 

of the proposed transfer. 

(B) This subsection applies to the following funds available to 

the Secretary concerned: 

(i) Unexpired funds in appropriations accounts that are 

available for procurement and that, as a result of economies, 

efficiencies, and other savings achieved in carrying out a particular procurement, are excess to the requirements of that 

procurement. 

(ii) Unexpired funds that are available during the final 30 

days of a fiscal year for support of installations and facilities 

and that, as a result of economies, efficiencies, and other savings, are excess to the requirements for support of installations 

and facilities. 

(iii) Unexpired funds in appropriations accounts that are 

available for procurement or operation and maintenance of a 

system, if and to the extent that savings are achieved for such 

accounts through reductions in life cycle costs of such system 

that result from one or more projects undertaken with respect 

to such systems with funds made available from the Defense 

Modernization Account under subsection (b)(1). 

(C) Any transfer under subparagraph (A) shall be made under 

regulations prescribed by the Secretary of Defense. 

(2) Funds referred to in paragraph (1), other than funds referred to in subparagraph (B)(iii) of such paragraph, may not be 

transferred to the Defense Modernization Account if— 

(A) the funds are necessary for programs, projects, and activities that, as determined by the Secretary, have a higher 

priority than the purposes for which the funds would be available if transferred to that account; or 
§ 2216 CH. 131—PLANNING AND COORDINATION 1084 

(B) the balance of funds in the account, after transfer of 

funds to the account, would exceed $1,000,000,000. 

(3) Amounts credited to the Defense Modernization Account 

shall remain available for transfer until the end of the third fiscal 

year that follows the fiscal year in which the amounts are credited 

to the account. 

(4) The period of availability of funds for expenditure provided 

for in sections 1551 and 1552 of title 31 may not be extended by 

transfer into the Defense Modernization Account. 

(d) AUTHORIZED USE OF FUNDS.—Funds in the Defense Modernization Account may be used for the following purposes: 

(1) For paying the costs of commencing any project that, 

in accordance with criteria prescribed by the Secretary of Defense, is undertaken by the Secretary of a military department 

or the head of a Defense Agency or other element of the Department of Defense to reduce the life cycle cost of a new or 

existing system. 

(2) For increasing, subject to subsection (e), the quantity of 

items and services procured under a procurement program in 

order to achieve a more efficient production or delivery rate. 

(3) For research, development, test, and evaluation and for 

procurement necessary for modernization of an existing system 

or of a system being procured under an ongoing procurement 

program. 

(e) LIMITATIONS.—(1) Funds in the Defense Modernization Account may not be used to increase the quantity of an item or services procured under a particular procurement program to the extent that doing so would— 

(A) result in procurement of a total quantity of items or 

services in excess of— 

(i) a specific limitation provided by law on the quantity of the items or services that may be procured; or 

(ii) the requirement for the items or services as approved by the Joint Requirements Oversight Council and 

reported to Congress by the Secretary of Defense; or 

(B) result in an obligation or expenditure of funds in excess of a specific limitation provided by law on the amount that 

may be obligated or expended, respectively, for that procurement program. 

(2) Funds in the Defense Modernization Account may not be 

used for a purpose or program for which Congress has not authorized appropriations. 

(3) Funds may not be transferred from the Defense Modernization Account in any year for the purpose of— 

(A) making an expenditure for which there is no corresponding obligation; or 

(B) making an expenditure that would satisfy an unliquidated or unrecorded obligation arising in a prior fiscal year. 

(f) TRANSFER OF FUNDS.—(1) The Secretary of Defense may 

transfer funds in the Defense Modernization Account to appropriations available for purposes set forth in subsection (d). 

(2) Funds in the Defense Modernization Account may not be 

transferred under paragraph (1) until 30 days after the date on 

which the Secretary concerned notifies the congressional defense 
1085 § 2216 CH. 131—PLANNING AND COORDINATION 

committees in writing of the amount and purpose of the proposed 

transfer. 

(3) The total amount of transfers from the Defense Modernization Account during any fiscal year under this subsection may not 

exceed $500,000,000. 

(g) AVAILABILITY OF FUNDS BY APPROPRIATION.—In addition to 

transfers under subsection (f), funds in the Defense Modernization 

Account may be made available for purposes set forth in subsection 

(d) in accordance with the provisions of appropriations Acts, but 

only to the extent authorized in an Act other than an appropriations Act. 

(h) SECRETARY TO ACT THROUGH COMPTROLLER.—(1) The Secretary of Defense shall carry out this section through the Under 

Secretary of Defense (Comptroller), who shall be authorized to implement this section through the issuance of any necessary regulations, policies, and procedures after consultation with the General 

Counsel and Inspector General of the Department of Defense. 

(2) The regulations prescribed under paragraph (1) shall, at a 

minimum, provide for— 

(A) the submission of proposals by the Secretaries concerned or heads of Defense Agencies or other elements of the 

Department of Defense to the Comptroller for the use of Defense Modernization Account funds for purposes set forth in 

subsection (d); 

(B) the use of a competitive process for the evaluation of 

such proposals and the selection of programs, projects, and activities to be funded out of the Defense Modernization Account 

from among those proposed for such funding; and 

(C) the calculation of— 

(i) the savings to be derived from projects described in 

subsection (d)(1) that are to be funded out of the Defense 

Modernization Account; and 

(ii) the amounts to be reimbursed to the Defense Modernization Account out of such savings pursuant to subsection (c)(1)(B)(iii). 

(i) ANNUAL REPORT.—(1) Not later than 15 days after the end 

of each fiscal year, the Secretary of Defense shall submit to the 

congressional committees specified in paragraph (2) a report on the 

Defense Modernization Account. Each such report shall set forth 

the following: 

(A) The amount and source of each credit to the account 

during that fiscal year. 

(B) The amount and purpose of each transfer from the account during that fiscal year. 

(C) The balance in the account at the end of the fiscal year 

and, of such balance, the amount attributable to transfers to 

the account from each Secretary concerned. 

(2) The committees referred to in paragraph (1) are the congressional defense committees and the Committee on Governmental Affairs of the Senate and the Committee on Government 

Reform and Oversight of the House of Representatives. 

(j) DEFINITIONS.—In this section: 
[§ 2216a CH. 131—PLANNING AND COORDINATION 1086 

(1) The term ‘‘Secretary concerned’’ includes the Secretary 

of Defense with respect to Defense-wide appropriations accounts. 

(2) The term ‘‘unexpired funds’’ means funds appropriated 

for a definite period that remain available for obligation. 

(k) EXPIRATION OF AUTHORITY AND ACCOUNT.—(1) The authority under subsection (c) to transfer funds into the Defense Modernization Account terminates at the close of September 30, 2006. 

(2) Three years after the termination date specified in paragraph (1), the Defense Modernization Account shall be closed and 

any remaining balance in the account shall be canceled and thereafter shall not be available for any purpose. 

(Added Pub. L. 104–106, div. A, title IX, Sec. 912(a)(1), Feb. 10, 1996, 110 Stat. 407; amended 

Pub. L. 106–65, div. A, title X, Sec. 1067(1), Oct. 5, 1999, 113 Stat. 774; Pub. L. 108–136, div. 

A, title X, Secs. 1008(a)–(f)(1), 1043(b)(8), Nov. 24, 2003, 117 Stat. 1586, 1611; Pub. L. 109–364, 

div. A, title X, Sec. 1071(a)(16), Oct. 17, 2006, 120 Stat. 2399.) 

[§ 2216a. Repealed. Pub. L. 105–261, div. A, title X, Sec. 

1008(b), Oct. 17, 1998, 112 Stat. 2117] 

§ 2217. Comparable budgeting for common procurement 

weapon systems 

(a) MATTERS TO BE INCLUDED IN ANNUAL DEFENSE BUDGETS.—In preparing the defense budget for any fiscal year, the Secretary of Defense shall— 

(1) specifically identify each common procurement weapon 

system included in the budget; 

(2) take all feasible steps to minimize variations in procurement unit costs for any such system as shown in the budget requests of the different armed forces requesting procurement funds for the system; and 

(3) identify and justify in the budget all such variations in 

procurement unit costs for common procurement weapon systems. 

(b) COMPTROLLER.—The Secretary shall carry out this section 

through the Under Secretary of Defense (Comptroller). 

(c) DEFINITIONS.—In this section: 

(1) The term ‘‘defense budget’’ means the budget of the Department of Defense included in the President’s budget submitted to Congress under section 1105 of title 31 for a fiscal 

year. 

(2) The term ‘‘common procurement weapon system’’ 

means a weapon system for which two or more of the Army, 

Navy, Air Force, and Marine Corps request procurement funds 

in a defense budget. 

(Added Pub. L. 100–370, Sec. 1(d)(3)(A), July 19, 1988, 102 Stat. 843; amended Pub. L. 104– 

106, div. A, title XV, Sec. 1503(a)(20), Feb. 10, 1996, 110 Stat. 512.) 

§ 2218. National Defense Sealift Fund 

(a) ESTABLISHMENT.—There is established in the Treasury of 

the United States a fund to be known as the ‘‘National Defense 

Sealift Fund’’. 

(b) ADMINISTRATION OF FUND.—The Secretary of Defense shall 

administer the Fund consistent with the provisions of this section. 
1087 § 2218 CH. 131—PLANNING AND COORDINATION 

(c) FUND PURPOSES.—(1) Funds in the National Defense Sealift 

Fund shall be available for obligation and expenditure only for the 

following purposes: 

(A) Construction (including design of vessels), purchase, alteration, and conversion of Department of Defense sealift vessels. 

(B) Operation, maintenance, and lease or charter of Department of Defense vessels for national defense purposes. 

(C) Installation and maintenance of defense features for 

national defense purposes on privately owned and operated 

vessels that are constructed in the United States and documented under the laws of the United States. 

(D) Research and development relating to national defense 

sealift. 

(E) Expenses for maintaining the National Defense Reserve Fleet under section 11 of the Merchant Ship Sales Act 

of 1946 (50 U.S.C. App. 1744), and for the costs of acquisition 

of vessels for, and alteration and conversion of vessels in (or 

to be placed in), the fleet, but only for vessels built in United 

States shipyards. 

(2) Funds in the National Defense Sealift Fund may be obligated or expended only in amounts authorized by law. 

(3) Funds obligated and expended for a purpose set forth in 

subparagraph (B) or (D) of paragraph (1) may be derived only from 

funds deposited in the National Defense Sealift Fund pursuant to 

subsection (d)(1). 

(d) DEPOSITS.—There shall be deposited in the Fund the following: 

(1) All funds appropriated to the Department of Defense 

for— 

(A) construction (including design of vessels), purchase, alteration, and conversion of national defense sealift 

vessels; 

(B) operations, maintenance, and lease or charter of 

national defense sealift vessels; 

(C) installation and maintenance of defense features 

for national defense purposes on privately owned and operated vessels; and 

(D) research and development relating to national defense sealift. 

(2) All receipts from the disposition of national defense 

sealift vessels, excluding receipts from the sale, exchange, or 

scrapping of National Defense Reserve Fleet vessels under sections 57101–57104 and chapter 573 of title 46. 

(3) All receipts from the charter of vessels under section 

1424(c) of the National Defense Authorization Act for Fiscal 

Year 1991 (10 U.S.C. 7291 note). 

(e) ACCEPTANCE OF SUPPORT.—(1) The Secretary of Defense 

may accept from any person, foreign government, or international 

organization any contribution of money, personal property (excluding vessels), or assistance in kind for support of the sealift functions of the Department of Defense. 

(2) Any contribution of property accepted under paragraph (1) 

may be retained and used by the Department of Defense or dis-
§ 2218 CH. 131—PLANNING AND COORDINATION 1088 

posed of in accordance with procedures prescribed by the Secretary 

of Defense. 

(3) The Secretary of Defense shall deposit in the Fund money 

and receipts from the disposition of any property accepted under 

paragraph (1). 

(f) LIMITATIONS.—(1) A vessel built in a foreign ship yard may 

not be purchased with funds in the National Defense Sealift Fund 

pursuant to subsection (c)(1), unless specifically authorized by law. 

(2) Construction, alteration, or conversion of vessels with funds 

in the National Defense Sealift Fund pursuant to subsection (c)(1) 

shall be conducted in United States ship yards and shall be subject 

to section 1424(b) of Public Law 101–510 (104 Stat. 1683). 

(g) EXPIRATION OF FUNDS AFTER 5 YEARS.—No part of an appropriation that is deposited in the National Defense Sealift Fund 

pursuant to subsection (d)(1) shall remain available for obligation 

more than five years after the end of fiscal year for which appropriated except to the extent specifically provided by law. 

(h) BUDGET REQUESTS.—Budget requests submitted to Congress for the National Defense Sealift Fund shall separately identify— 

(1) the amount requested for programs, projects, and activities for construction (including design of vessels), purchase, 

alteration, and conversion of national defense sealift vessels; 

(2) the amount requested for programs, projects, and activities for operation, maintenance, and lease or charter of national defense sealift vessels; 

(3) the amount requested for programs, projects, and activities for installation and maintenance of defense features for 

national defense purposes on privately owned and operated 

vessels that are constructed in the United States and documented under the laws of the United States; and 

(4) the amount requested for programs, projects, and activities for research and development relating to national defense sealift. 

(i) TITLE OR MANAGEMENT OF VESSELS.—Nothing in this section (other than subsection (c)(1)(E)) shall be construed to affect or 

modify title to, management of, or funding responsibilities for, any 

vessel of the National Defense Reserve Fleet, or assigned to the 

Ready Reserve Force component of the National Defense Reserve 

Fleet, as established by section 11 of the Merchant Ship Sales Act 

of 1946 (50 U.S.C. App. 1744). 

(j) CONTRACTS FOR INCORPORATION OF DEFENSE FEATURES IN

COMMERCIAL VESSELS.—(1) The head of an agency may enter into 

a contract with a company submitting an offer for that company to 

install and maintain defense features for national defense purposes 

in one or more commercial vessels owned or controlled by that company in accordance with the purpose for which funds in the National Defense Sealift Fund are available under subsection 

(c)(1)(C). The head of the agency may enter into such a contract 

only after the head of the agency makes a determination of the economic soundness of the offer. As consideration for a contract with 

the head of an agency under this subsection, the company entering 

into the contract shall agree with the Secretary of Defense to make 

any vessel covered by the contract available to the Secretary, fully 
1089 § 2218 CH. 131—PLANNING AND COORDINATION 

crewed and ready for sea, at any time at any port determined by 

the Secretary, and for whatever duration the Secretary determines 

necessary. 

(2) The head of an agency may make advance payments to the 

contractor under a contract under paragraph (1) in a lump sum, in 

annual payments, or in a combination thereof for costs associated 

with the installation and maintenance of the defense features on 

a vessel covered by the contract, as follows: 

(A) The costs to build, procure, and install a defense feature in the vessel. 

(B) The costs to periodically maintain and test any defense 

feature on the vessel. 

(C) Any increased costs of operation or any loss of revenue 

attributable to the installation or maintenance of any defense 

feature on the vessel. 

(D) Any additional costs associated with the terms and 

conditions of the contract. 

(E) Payments of such sums as the Government would otherwise expend, if the vessel were placed in the Ready Reserve 

Fleet, for maintaining the vessel in the status designated as 

‘‘ROS–4 status’’ in the Ready Reserve Fleet for 25 years. 

(3) For any contract under paragraph (1) under which the 

United States makes advance payments under paragraph (2) for 

the costs associated with installation or maintenance of any defense feature on a commercial vessel, the contractor shall provide 

to the United States such security interests in the vessel, by way 

of a preferred mortgage under section 31322 of title 46 or otherwise, as the head of the agency may prescribe in order to adequately protect the United States against loss for the total amount 

of those costs. 

(4) Each contract entered into under this subsection shall— 

(A) set forth terms and conditions under which, so long as 

a vessel covered by the contract is owned or controlled by the 

contractor, the contractor is to operate the vessel for the Department of Defense notwithstanding any other contract or 

commitment of that contractor; and 

(B) provide that the contractor operating the vessel for the 

Department of Defense shall be paid for that operation at fair 

and reasonable rates. 

(5) The head of an agency may not delegate authority under 

this subsection to any officer or employee in a position below the 

level of head of a procuring activity. 

(6) The head of an agency may not enter into a contract under 

paragraph (1) that would provide for payments to the contractor as 

authorized in paragraph (2)(E) until notice of the proposed contract 

is submitted to the congressional defense committees and a period 

of 90 days has elapsed. 

(k) DEFINITIONS.—In this section: 

(1) The term ‘‘Fund’’ means the National Defense Sealift 

Fund established by subsection (a). 

(2) The term ‘‘Department of Defense sealift vessel’’ means 

any ship owned, operated, controlled, or chartered by the Department of Defense that is any of the following: 
[§ 2219 CH. 131—PLANNING AND COORDINATION 1090 

(A) A fast sealift ship, including any vessel in the Fast 

Sealift Program established under section 1424 of Public 

Law 101–510 (104 Stat. 1683). 

(B) Any other auxiliary vessel that was procured or 

chartered with specific authorization in law for the vessel, 

or class of vessels, to be funded in the National Defense 

Sealift Fund. 

(3) The term ‘‘national defense sealift vessel’’ means— 

(A) a Department of Defense sealift vessel; and 

(B) a national defense reserve fleet vessel, including a 

vessel in the Ready Reserve Force maintained under section 11 of the Merchant Ship Sales Act of 1946 (50 U.S.C. 

App. 1744). 

(4) The term ‘‘head of an agency’’ has the meaning given 

that term in section 2302(1) of this title. 

(Added Pub. L. 102–484, div. A, title X, Sec. 1024(a)(1), Oct. 23, 1992, 106 Stat. 2486; amended 

Pub. L. 102–396, title V, Oct. 6, 1992, 106 Stat. 1896; Pub. L. 104–106, div. A, title X, Sec. 

1014(a), title XV, Sec. 1502(a)(15), Feb. 10, 1996, 110 Stat. 423, 503; Pub. L. 106–65, div. A, 

title X, Secs. 1014(b), 1015, 1067(1), Oct. 5, 1999, 113 Stat. 742, 743, 774; Pub. L. 106–398, Sec. 

1 [[div. A], title X, Sec. 1011], Oct. 30, 2000, 114 Stat. 1654, 1654A–251; Pub. L. 107–107, div. 

A, title X, Sec. 1048(e)(9), Dec. 28, 2001, 115 Stat. 1228; Pub. L. 108–136, div. A, title X, Sec. 

1043(b)(9), Nov. 24, 2003, 117 Stat. 1611; Pub. L. 109–163, div. A, title X, Sec. 1018(d), Jan. 

6, 2006, 119 Stat. 3426; Pub. L. 109–304, Sec. 17(a)(2), Oct. 6, 2006, 120 Stat. 1706; Pub. L. 

110–417, [div. A], title XIV, Sec. 1407, Oct. 14, 2008, 122 Stat. 4647.) 

[§ 2219. Renumbered 2491c] 

§ 2220. Performance based management: acquisition programs 

(a) ESTABLISHMENT OF GOALS.—The Secretary of Defense shall 

approve or define the cost, performance, and schedule goals for 

major defense acquisition programs of the Department of Defense 

and for each phase of the acquisition cycle of such programs. 

(b) Evaluation of Cost Goals —The Under Secretary of Defense 

(Comptroller) shall evaluate the cost goals proposed for each major 

defense acquisition program of the Department. 

(Added Pub. L. 103–355, title V, Sec. 5001(a)(1), Oct. 13, 1994, 108 Stat. 3349; amended Pub. 

L. 104–106, div. A, title XV, Sec. 1503(a)(20), div. D, title XLIII, Sec. 4321(b)(1), Feb. 10, 1996, 

110 Stat. 512, 671; Pub. L. 105–85, div. A, title VIII, Sec. 841(a), Nov. 18, 1997, 111 Stat. 1843; 

Pub. L. 107–314, div. A, title X, Sec. 1041(a)(8), Dec. 2, 2002, 116 Stat. 2645.) 

[§ 2221. Repealed. Pub. L. 105–261, div. A, title IX, Sec. 

906(f)(1), Oct. 17, 1998, 112 Stat. 2096] 

§ 2222. Defense business systems: architecture, accountability, and modernization 

(a) CONDITIONS FOR OBLIGATION OF FUNDS FOR DEFENSE BUSINESS SYSTEM MODERNIZATION.—Funds appropriated to the Department of Defense may not be obligated for a defense business system modernization that will have a total cost in excess of 

$1,000,000 unless— 

(1) the appropriate chief management officer for the defense business system modernization has determined whether 

or not— 

(A) the defense business system modernization is in 

compliance with the enterprise architecture developed 

under subsection (c); and 
1091 § 2222 CH. 131—PLANNING AND COORDINATION 

(B) appropriate business process reengineering efforts 

have been undertaken to ensure that— 

(i) the business process to be supported by the defense business system modernization will be as 

streamlined and efficient as practicable; and 

(ii) the need to tailor commercial-off-the-shelf systems to meet unique requirements or incorporate 

unique interfaces has been eliminated or reduced to 

the maximum extent practicable; 

(2) the approval authority designated for the defense business system certifies to the Defense Business Systems Management Committee established by section 186 of this title that 

the defense business system modernization— 

(A) has been determined by the appropriate chief management officer to be in compliance with the requirements 

of paragraph (1); 

(B) is necessary to achieve a critical national security 

capability or address a critical requirement in an area 

such as safety or security; or 

(C) is necessary to prevent a significant adverse effect 

on a project that is needed to achieve an essential capability, taking into consideration the alternative solutions 

for preventing such adverse effect; and 

(3) the certification by the approval authority and the determination by the chief management officer are approved by 

the Defense Business Systems Management Committee. 

(b) OBLIGATION OF FUNDS IN VIOLATION OF REQUIREMENTS.— 

The obligation of Department of Defense funds for a business system modernization in excess of the amount specified in subsection 

(a) that has not been certified and approved in accordance with 

such subsection is a violation of section 1341(a)(1)(A) of title 31. 

(c) ENTERPRISE ARCHITECTURE FOR DEFENSE BUSINESS SYSTEMS.—Not later than September 30, 2005, the Secretary of Defense, acting through the Defense Business Systems Management 

Committee, shall develop— 

(1) an enterprise architecture to cover all defense business 

systems, and the functions and activities supported by defense 

business systems, which shall be sufficiently defined to effectively guide, constrain, and permit implementation of interoperable defense business system solutions and consistent with 

the policies and procedures established by the Director of the 

Office of Management and Budget, and 

(2) a transition plan for implementing the enterprise architecture for defense business systems. 

(d) COMPOSITION OF ENTERPRISE ARCHITECTURE.—The defense 

business enterprise architecture developed under subsection (c)(1) 

shall include the following: 

(1) An information infrastructure that, at a minimum, 

would enable the Department of Defense to— 

(A) comply with all Federal accounting, financial management, and reporting requirements; 

(B) routinely produce timely, accurate, and reliable financial information for management purposes; 
§ 2222 CH. 131—PLANNING AND COORDINATION 1092 

(C) integrate budget, accounting, and program information and systems; and 

(D) provide for the systematic measurement of performance, including the ability to produce timely, relevant, 

and reliable cost information. 

(2) Policies, procedures, data standards, and system interface requirements that are to apply uniformly throughout the 

Department of Defense. 

(e) COMPOSITION OF TRANSITION PLAN.—(1) The transition plan 

developed under subsection (c)(2) shall include the following: 

(A) The acquisition strategy for new systems that are expected to be needed to complete the defense business enterprise architecture. 

(B) A listing of the defense business systems as of December 2, 2002 (known as ‘‘legacy systems’’), that will not be part 

of the objective defense business enterprise architecture, together with the schedule for terminating those legacy systems 

that provides for reducing the use of those legacy systems in 

phases. 

(C) A listing of the legacy systems (referred to in subparagraph (B)) that will be a part of the objective defense business 

system, together with a strategy for making the modifications 

to those systems that will be needed to ensure that such systems comply with the defense business enterprise architecture. 

(2) Each of the strategies under paragraph (1) shall include 

specific time-phased milestones, performance metrics, and a statement of the financial and nonfinancial resource needs. 

(f) APPROVAL AUTHORITIES AND ACCOUNTABILITY FOR DEFENSE

BUSINESS SYSTEMS.—(1) The Secretary of Defense shall delegate responsibility for review, approval, and oversight of the planning, design, acquisition, deployment, operation, maintenance, and modernization of defense business systems as follows: 

(A) The Under Secretary of Defense for Acquisition, Technology and Logistics shall be responsible and accountable for 

any defense business system the primary purpose of which is 

to support acquisition activities, logistics activities, or installations and environment activities of the Department of Defense. 

(B) The Under Secretary of Defense (Comptroller) shall be 

responsible and accountable for any defense business system 

the primary purpose of which is to support financial management activities or strategic planning and budgeting activities of 

the Department of Defense. 

(C) The Under Secretary of Defense for Personnel and 

Readiness shall be responsible and accountable for any defense 

business system the primary purpose of which is to support 

human resource management activities of the Department of 

Defense. 

(D) The Assistant Secretary of Defense for Networks and 

Information Integration and the Chief Information Officer of 

the Department of Defense shall be responsible and accountable for any defense business system the primary purpose of 

which is to support information technology infrastructure or information assurance activities of the Department of Defense. 
1093 § 2222 CH. 131—PLANNING AND COORDINATION 

(E) The Deputy Secretary of Defense or an Under Secretary of Defense, as designated by the Secretary of Defense, 

shall be responsible for any defense business system the primary purpose of which is to support any activity of the Department of Defense not covered by subparagraphs (A) through (D). 

(2) For purposes of subsection (a), the appropriate chief management officer for a defense business system modernization is as 

follows: 

(A) In the case of an Army program, the Chief Management Officer of the Army. 

(B) In the case of a Navy program, the Chief Management 

Officer of the Navy. 

(C) In the case of an Air Force program, the Chief Management Officer of the Air Force. 

(D) In the case of a program of a Defense Agency, the Deputy Chief Management Officer of the Department of Defense. 

(E) In the case of a program that will support the business 

processes of more than one military department or Defense 

Agency, the Deputy Chief Management Officer of the Department of Defense. 

(g) DEFENSE BUSINESS SYSTEM INVESTMENT REVIEW.—(1) The 

Secretary of Defense shall require each approval authority designated under subsection (f) to establish, not later than March 15, 

2005, an investment review process, consistent with section 11312 

of title 40, to review the planning, design, acquisition, development, 

deployment, operation, maintenance, modernization, and project 

cost benefits and risks of all defense business systems for which 

the approval authority is responsible. The investment review process so established shall specifically address the responsibilities of 

approval authorities under subsection (a). 

(2) The review of defense business systems under the investment review process shall include the following: 

(A) Review and approval by an investment review board of 

each defense business system as an investment before the obligation of funds on the system. 

(B) Periodic review, but not less than annually, of every 

defense business system investment. 

(C) Representation on each investment review board by appropriate officials from among the armed forces, combatant 

commands, the Joint Chiefs of Staff, and Defense Agencies. 

(D) Use of threshold criteria to ensure an appropriate level 

of review within the Department of Defense of, and accountability for, defense business system investments depending on 

scope, complexity, and cost. 

(E) Use of procedures for making certifications in accordance with the requirements of subsection (a). 

(F) Use of procedures for ensuring consistency with the 

guidance issued by the Secretary of Defense and the Defense 

Business Systems Management Committee, as required by section 186(c) of this title, and incorporation of common decision 

criteria, including standards, requirements, and priorities that 

result in the integration of defense business systems. 

(h) BUDGET INFORMATION.—In the materials that the Secretary 

submits to Congress in support of the budget submitted to Con-
§ 2222 CH. 131—PLANNING AND COORDINATION 1094 

gress under section 1105 of title 31 for fiscal year 2006 and fiscal 

years thereafter, the Secretary of Defense shall include the following information: 

(1) Identification of each defense business system for which 

funding is proposed in that budget. 

(2) Identification of all funds, by appropriation, proposed in 

that budget for each such system, including— 

(A) funds for current services (to operate and maintain 

the system); and 

(B) funds for business systems modernization, identified for each specific appropriation. 

(3) For each such system, identification of the official to 

whom authority for such system is delegated under subsection 

(f). 

(4) For each such system, a description of each certification 

made under subsection (d) with regard to such system. 

(i) CONGRESSIONAL REPORTS.—Not later than March 15 of each 

year from 2005 through 2013, the Secretary of Defense shall submit to the congressional defense committees a report on Department of Defense compliance with the requirements of this section. 

The first report shall define plans and commitments for meeting 

the requirements of subsection (a), including specific milestones 

and performance measures. Subsequent reports shall— 

(1) describe actions taken and planned for meeting the requirements of subsection (a), including— 

(A) specific milestones and actual performance against 

specified performance measures, and any revision of such 

milestones and performance measures; and 

(B) specific actions on the defense business system 

modernizations submitted for certification under such subsection; 

(2) identify the number of defense business system modernizations so certified; 

(3) identify any defense business system modernization 

with an obligation in excess of $1,000,000 during the preceding 

fiscal year that was not certified under subsection (a), and the 

reasons for the waiver; and 

(4) discuss specific improvements in business operations 

and cost savings resulting from successful defense business 

systems modernization efforts. 

(j) DEFINITIONS.—In this section: 

(1) The term ‘‘approval authority’’, with respect to a defense business system, means the Department of Defense official responsible for the defense business system, as designated 

by subsection (f). 

(2) The term ‘‘defense business system’’ means an information system, other than a national security system, operated 

by, for, or on behalf of the Department of Defense, including 

financial systems, mixed systems, financial data feeder systems, and information technology and information assurance 

infrastructure, used to support business activities, such as acquisition, financial management, logistics, strategic planning 

and budgeting, installations and environment, and human resource management. 
1095 § 2223 CH. 131—PLANNING AND COORDINATION 

(3) The term ‘‘defense business system modernization’’ 

means— 

(A) the acquisition or development of a new defense 

business system; or 

(B) any significant modification or enhancement of an 

existing defense business system (other than necessary to 

maintain current services). 

(4) The term ‘‘enterprise architecture’’ has the meaning 

given that term in section 3601(4) of title 44. 

(5) The terms ‘‘information system’’ and ‘‘information technology’’ have the meanings given those terms in section 11101 

of title 40. 

(6) The term ‘‘national security system’’ has the meaning 

given that term in section 3542(b)(2) of title 44. 

(Added Pub. L. 108–375, div. A, title III, Sec. 332(a)(1), Oct. 28, 2004, 118 Stat. 1851; amended 

Pub. L. 109–364, div. A, title IX, Sec. 906(a), Oct. 17, 2006, 120 Stat. 2354; Pub. L. 110–417, 

[div. A], title III, Sec. 351, Oct. 14, 2008, 122 Stat. 4425; Pub. L. 111–84, div. A, title X, Sec. 

1072(a), Oct. 28, 2009, 123 Stat. 2470; Pub. L. 111–383, div. A, title X, Sec. 1075(b)(29), Jan. 

7, 2011, 124 Stat. 4370.) 

§ 2223. Information technology: additional responsibilities 

of Chief Information Officers 

(a) ADDITIONAL RESPONSIBILITIES OF CHIEF INFORMATION OFFICER OF DEPARTMENT OF DEFENSE.—In addition to the responsibilities provided for in chapter 35 of title 44 and in section 11315 of 

title 40, the Chief Information Officer of the Department of Defense 

shall— 

(1) review and provide recommendations to the Secretary 

of Defense on Department of Defense budget requests for information technology and national security systems; 

(2) ensure the interoperability of information technology 

and national security systems throughout the Department of 

Defense; 

(3) ensure that information technology and national security systems standards that will apply throughout the Department of Defense are prescribed; 

(4) provide for the elimination of duplicate information 

technology and national security systems within and between 

the military departments and Defense Agencies; and 

(5) maintain a consolidated inventory of Department of Defense mission critical and mission essential information systems, identify interfaces between those systems and other information systems, and develop and maintain contingency 

plans for responding to a disruption in the operation of any of 

those information systems. 

(b) ADDITIONAL RESPONSIBILITIES OF CHIEF INFORMATION OFFICER OF MILITARY DEPARTMENTS.—In addition to the responsibilities 

provided for in chapter 35 of title 44 and in section 11315 of title 

40, the Chief Information Officer of a military department, with respect to the military department concerned, shall— 

(1) review budget requests for all information technology 

and national security systems; 

(2) ensure that information technology and national security systems are in compliance with standards of the Government and the Department of Defense; 
§ 2223a CH. 131—PLANNING AND COORDINATION 1096 

(3) ensure that information technology and national security systems are interoperable with other relevant information 

technology and national security systems of the Government 

and the Department of Defense; and 

(4) coordinate with the Joint Staff with respect to information technology and national security systems. 

(c) DEFINITIONS.—In this section: 

(1) The term ‘‘Chief Information Officer’’ means the senior official designated by the Secretary of Defense or a Secretary of a military department pursuant to section 3506 of title 44. 

(2) The term ‘‘information technology’’ has the meaning given 

that term by section 11101 of title 40. 

(3) The term ‘‘national security system’’ has the meaning given 

that term by section 3542(b)(2) of title 44. 

(Added Pub. L. 105–261, div. A, title III, Sec. 331(a)(1), Oct. 17, 1998, 112 Stat. 1967; amended 

Pub. L. 106–398, Sec. 1 [[div. A], title VIII, Sec. 811(a)], Oct. 30, 2000, 114 Stat. 1654, 1654A– 

210; Pub. L. 107–217, Sec. 3(b)(1), Aug. 21, 2002, 116 Stat. 1295; Pub. L. 109–364, div. A, title 

IX, Sec. 906(b), Oct. 17, 2006, 120 Stat. 2354.) 

§ 2223a. Information technology acquisition planning and 

oversight requirements 

(a) ESTABLISHMENT OF PROGRAM.—The Secretary of Defense 

shall establish a program to improve the planning and oversight 

processes for the acquisition of major automated information systems by the Department of Defense. 

(b) PROGRAM COMPONENTS.—The program established under 

subsection (a) shall include— 

(1) a documented process for information technology acquisition planning, requirements development and management, 

project management and oversight, earned value management, 

and risk management; 

(2) the development of appropriate metrics that can be implemented and monitored on a real-time basis for performance 

measurement of— 

(A) processes and development status of investments 

in major automated information system programs; 

(B) continuous process improvement of such programs; 

and 

(C) achievement of program and investment outcomes; 

(3) a process to ensure that key program personnel have 

an appropriate level of experience, training, and education in 

the planning, acquisition, execution, management, and oversight of information technology systems; 

(4) a process to ensure sufficient resources and infrastructure capacity for test and evaluation of information technology 

systems; 

(5) a process to ensure that military departments and Defense Agencies adhere to established processes and requirements relating to the planning, acquisition, execution, management, and oversight of information technology programs and 

developments; and 

(6) a process under which an appropriate Department of 

Defense official may intervene or terminate the funding of an 

information technology investment if the investment is at risk 

of not achieving major project milestones. 
1097 § 2224 CH. 131—PLANNING AND COORDINATION 

(Added Pub. L. 111–383, div. A, title VIII, Sec. 805(a)(1), Jan. 7, 2011, 124 Stat. 4259.) 

§ 2224. Defense Information Assurance Program 

(a) DEFENSE INFORMATION ASSURANCE PROGRAM.—The Secretary of Defense shall carry out a program, to be known as the 

‘‘Defense Information Assurance Program’’, to protect and defend 

Department of Defense information, information systems, and information networks that are critical to the Department and the 

armed forces during day-to-day operations and operations in times 

of crisis. 

(b) OBJECTIVES OF THE PROGRAM.—The objectives of the program shall be to provide continuously for the availability, integrity, 

authentication, confidentiality, nonrepudiation, and rapid restitution of information and information systems that are essential elements of the Defense Information Infrastructure. 

(c) PROGRAM STRATEGY.—In carrying out the program, the Secretary shall develop a program strategy that encompasses those actions necessary to assure the readiness, reliability, continuity, and 

integrity of Defense information systems, networks, and infrastructure, including through compliance with subchapter II of chapter 

35 of title 44, including through compliance with subchapter III of 

chapter 35 of title 44. The program strategy shall include the following: 

(1) A vulnerability and threat assessment of elements of 

the defense and supporting nondefense information infrastructures that are essential to the operations of the Department 

and the armed forces. 

(2) Development of essential information assurances technologies and programs. 

(3) Organization of the Department, the armed forces, and 

supporting activities to defend against information warfare. 

(4) Joint activities of the Department with other departments and agencies of the Government, State and local agencies, and elements of the national information infrastructure. 

(5) The conduct of exercises, war games, simulations, experiments, and other activities designed to prepare the Department to respond to information warfare threats. 

(6) Development of proposed legislation that the Secretary 

considers necessary for implementing the program or for otherwise responding to the information warfare threat. 

(d) COORDINATION.—In carrying out the program, the Secretary 

shall coordinate, as appropriate, with the head of any relevant Federal agency and with representatives of those national critical information infrastructure systems that are essential to the operations of the Department and the armed forces on information assurance measures necessary to the protection of these systems. 

[(e) Repealed. Pub. L. 108–136, div. A, title X, Sec. 1031(a)(12), 

Nov. 24, 2003, 117 Stat. 1597.] 

(f) INFORMATION ASSURANCE TEST BED.—The Secretary shall 

develop an information assurance test bed within the Department 

of Defense to provide— 

(1) an integrated organization structure to plan and facilitate the conduct of simulations, war games, exercises, experi-
§ 2224a CH. 131—PLANNING AND COORDINATION 1098 

ments, and other activities to prepare and inform the Department regarding information warfare threats; and 

(2) organization and planning means for the conduct by 

the Department of the integrated or joint exercises and experiments with elements of the national information systems infrastructure and other non-Department of Defense organizations 

that are responsible for the oversight and management of critical information systems and infrastructures on which the Department, the armed forces, and supporting activities depend 

for the conduct of daily operations and operations during crisis. 

(Added Pub. L. 106–65, div. A, title X, Sec. 1043(a), Oct. 5, 1999, 113 Stat. 760; amended Pub. 

L. 106–398, Sec. 1 [[div. A], title X, Sec. 1063], Oct. 30, 2000, 114 Stat. 1654, 1654A–274; Pub. 

L. 107–296, title X, Sec. 1001(c)(1)(B), Nov. 25, 2002, 116 Stat. 2267; Pub. L. 107–347, title III, 

Sec. 301(c)(1)(B), Dec. 17, 2002, 116 Stat. 2955; Pub. L. 108–136, div. A, title X, Sec. 1031(a)(12), 

Nov. 24, 2003, 117 Stat. 1597; Pub. L. 108–375, div. A, title X, Sec. 1084(d)(17), Oct. 28, 2004, 

118 Stat. 2062.) 

§ 2224a. Information security: continued applicability of expiring Governmentwide requirements to the Department of Defense 

(a) IN GENERAL.—The provisions of subchapter II of chapter 35 

of title 44 shall continue to apply through September 30, 2004, 

with respect to the Department of Defense, notwithstanding the expiration of authority under section 3536 of such title. 

(b) RESPONSIBILITIES.—In administering the provisions of subchapter II of chapter 35 of title 44 with respect to the Department 

of Defense after the expiration of authority under section 3536 of 

such title, the Secretary of Defense shall perform the duties set 

forth in that subchapter for the Director of the Office of Management and Budget. 

(Added Pub. L. 107–314, div. A, title X, Sec. 1052(b)(1), Dec. 2, 2002, 116 Stat. 2648.) 

§ 2225. Information technology purchases: tracking and 

management 

(a) COLLECTION OF DATA REQUIRED.—To improve tracking and 

management of information technology products and services by 

the Department of Defense, the Secretary of Defense shall provide 

for the collection of the data described in subsection (b) for each 

purchase of such products or services made by a military department or Defense Agency in excess of the simplified acquisition 

threshold, regardless of whether such a purchase is made in the 

form of a contract, task order, delivery order, military interdepartmental purchase request, or any other form of interagency agreement. 

(b) DATA TO BE COLLECTED.—The data required to be collected 

under subsection (a) includes the following: 

(1) The products or services purchased. 

(2) Whether the products or services are categorized as 

commercially available off-the-shelf items, other commercial 

items, nondevelopmental items other than commercial items, 

other noncommercial items, or services. 

(3) The total dollar amount of the purchase. 

(4) The form of contracting action used to make the purchase. 
1099 § 2225 CH. 131—PLANNING AND COORDINATION 

(5) In the case of a purchase made through an agency 

other than the Department of Defense— 

(A) the agency through which the purchase is made; 

and 

(B) the reasons for making the purchase through that 

agency. 

(6) The type of pricing used to make the purchase (whether fixed price or another type of pricing). 

(7) The extent of competition provided in making the purchase. 

(8) A statement regarding whether the purchase was made 

from— 

(A) a small business concern; 

(B) a small business concern owned and controlled by 

socially and economically disadvantaged individuals; or 

(C) a small business concern owned and controlled by 

women. 

(9) A statement regarding whether the purchase was made 

in compliance with the planning requirements under sections 

11312 and 11313 of title 40. 

(c) RESPONSIBILITY TO ENSURE FAIRNESS OF CERTAIN PRICES.— The head of each contracting activity in the Department of Defense 

shall have responsibility for ensuring the fairness and reasonableness of unit prices paid by the contracting activity for information 

technology products and services that are frequently purchased 

commercially available off-the-shelf items. 

(d) LIMITATION ON CERTAIN PURCHASES.—No purchase of information technology products or services in excess of the simplified 

acquisition threshold shall be made for the Department of Defense 

from a Federal agency outside the Department of Defense unless— 

(1) the purchase data is collected in accordance with subsection (a); or 

(2)(A) in the case of a purchase by a Defense Agency, the 

purchase is approved by the Under Secretary of Defense for 

Acquisition, Technology, and Logistics; or 

(B) in the case of a purchase by a military department, the 

purchase is approved by the senior procurement executive of 

the military department. 

(e) ANNUAL REPORT.—Not later than March 15 of each year, 

the Secretary of Defense shall submit to the Committees on Armed 

Services of the Senate and the House of Representatives a report 

containing a summary of the data collected in accordance with subsection (a). 

(f) DEFINITIONS.—In this section: 

(1) The term ‘‘senior procurement executive’’, with respect 

to a military department, means the official designated as the 

senior procurement executive for the military department for 

the purposes of section 1702(c) of title 41. 

(2) The term ‘‘simplified acquisition threshold’’ has the 

meaning given the term in section 134 of title 41. 

(3) The term ‘‘small business concern’’ means a business 

concern that meets the applicable size standards prescribed 

pursuant to section 3(a) of the Small Business Act (15 U.S.C. 

632(a)). 
§ 2226 CH. 131—PLANNING AND COORDINATION 1100 

(4) The term ‘‘small business concern owned and controlled 

by socially and economically disadvantaged individuals’’ has 

the meaning given that term in section 8(d)(3)(C) of the Small 

Business Act (15 U.S.C. 637(d)(3)(C)). 

(5) The term ‘‘small business concern owned and controlled 

by women’’ has the meaning given that term in section 

8(d)(3)(D) of the Small Business Act (15 U.S.C. 637(d)(3)(D)). 

(Added Pub. L. 106–398, Sec. 1 [[div. A], title VIII, Sec. 812(a)(1)], Oct. 30, 2000, 114 Stat. 1654, 

1654A–212; amended Pub. L. 108–178, Sec. 4(b)(2), Dec. 15, 2003, 117 Stat. 2640; Pub. L. 109– 

364, div. A, title X, Sec. 1071(a)(2), Oct. 17, 2006, 120 Stat. 2398; Pub. L. 111–350, Sec. 5(b)(6), 

Jan. 4, 2011, 124 Stat. 3842.) 

§ 2226. Contracted property and services: prompt payment 

of vouchers 

(a) REQUIREMENT.—Of the contract vouchers that are received 

by the Defense Finance and Accounting Service by means of the 

mechanization of contract administration services system, the number of such vouchers that remain unpaid for more than 30 days as 

of the last day of each month may not exceed 5 percent of the total 

number of the contract vouchers so received that remain unpaid on 

that day. 

(b) CONTRACT VOUCHER DEFINED.—In this section, the term 

‘‘contract voucher’’ means a voucher or invoice for the payment to 

a contractor for services, commercial items (as defined in section 

103 of title 41, or other deliverable items provided by the contractor under a contract funded by the Department of Defense. 

(Added Pub. L. 106–398, Sec. 1 [[div. A], title X, Sec. 1006(a)(1)], Oct. 30, 2000, 114 Stat. 1654, 

1654A–247; amended Pub. L. 111–350, Sec. 5(b)(7), Jan. 4, 2011, 124 Stat. 3842.) 

§ 2227. Electronic submission and processing of claims for 

contract payments 

(a) SUBMISSION OF CLAIMS.—The Secretary of Defense shall require that any claim for payment under a Department of Defense 

contract shall be submitted to the Department of Defense in electronic form. 

(b) PROCESSING.—A contracting officer, contract administrator, 

certifying official, or other officer or employee of the Department of 

Defense who receives a claim for payment in electronic form in accordance with subsection (a) and is required to transmit the claim 

to any other officer or employee of the Department of Defense for 

processing under procedures of the department shall transmit the 

claim and any additional documentation necessary to support the 

determination and payment of the claim to such other officer or 

employee electronically. 

(c) WAIVER AUTHORITY.—If the Secretary of Defense determines that the requirement for using electronic means for submitting claims under subsection (a), or for transmitting claims and 

supporting documentation under subsection (b), is unduly burdensome in any category of cases, the Secretary may exempt the cases 

in that category from the application of the requirement. 

(d) IMPLEMENTATION OF REQUIREMENTS.—In implementing 

subsections (a) and (b), the Secretary of Defense shall provide for 

the following: 

(1) Policies, requirements, and procedures for using electronic means for the submission of claims for payment to the 
1101 § 2228 CH. 131—PLANNING AND COORDINATION 

Department of Defense and for the transmission, between Department of Defense officials, of claims for payment received in 

electronic form, together with supporting documentation (such 

as receiving reports, contracts and contract modifications, and 

required certifications). 

(2) The format in which information can be accepted by the 

corporate database of the Defense Finance and Accounting 

Service. 

(3) The requirements to be included in contracts regarding 

the electronic submission of claims for payment by contractors. 

(e) CLAIM FOR PAYMENT DEFINED.—In this section, the term 

‘‘claim for payment’’ means an invoice or any other demand or request for payment. 

(Added Pub. L. 106–398, Sec. 1 [[div. A], title X, Sec. 1008(a)(1)], Oct. 30, 2000, 114 Stat. 1654, 

1654A–249.) 

§ 2228. Office of Corrosion Policy and Oversight 

(a) OFFICE AND DIRECTOR.—(1) There is an Office of Corrosion 

Policy and Oversight within the Office of the Under Secretary of 

Defense for Acquisition, Technology, and Logistics. 

(2) The Office shall be headed by a Director of Corrosion Policy 

and Oversight, who shall be assigned to such position by the Under 

Secretary from among civilian employees of the Department of Defense with the qualifications described in paragraph (3). The Director is responsible in the Department of Defense to the Secretary of 

Defense (after the Under Secretary of Defense for Acquisition, 

Technology, and Logistics) for the prevention and mitigation of corrosion of the military equipment and infrastructure of the Department of Defense. The Director shall report directly to the Under 

Secretary. 

(3) In order to qualify to be assigned to the position of Director, 

an individual shall— 

(A) have management expertise in, and professional experience with, corrosion project and policy implementation, including an understanding of the effects of corrosion policies on 

infrastructure; research, development, test, and evaluation; 

and maintenance; and 

(B) have an understanding of Department of Defense budget formulation and execution, policy formulation, and planning 

and program requirements. 

(4) The Secretary of Defense shall designate the position of Director as a critical acquisition position under section 1733(b)(1)(C) 

of this title. 

(b) DUTIES.—(1) The Director of Corrosion Policy and Oversight 

(in this section referred to as the ‘‘Director’’) shall oversee and coordinate efforts throughout the Department of Defense to prevent 

and mitigate corrosion of the military equipment and infrastructure of the Department. The duties under this paragraph shall include the duties specified in paragraphs (2) through (5). 

(2) The Director shall develop and recommend any policy guidance on the prevention and mitigation of corrosion to be issued by 

the Secretary of Defense. 

(3) The Director shall review the programs and funding levels 

proposed by the Secretary of each military department during the 
§ 2228 CH. 131—PLANNING AND COORDINATION 1102 

annual internal Department of Defense budget review process as 

those programs and funding proposals relate to programs and funding for the prevention and mitigation of corrosion and shall submit 

to the Secretary of Defense recommendations regarding those programs and proposed funding levels. 

(4) The Director shall provide oversight and coordination of the 

efforts within the Department of Defense to prevent or mitigate 

corrosion during— 

(A) the design, acquisition, and maintenance of military 

equipment; and 

(B) the design, construction, and maintenance of infrastructure. 

(5) The Director shall monitor acquisition practices within the 

Department of Defense— 

(A) to ensure that the use of corrosion prevention technologies and the application of corrosion prevention treatments 

are fully considered during research and development in the 

acquisition process; and 

(B) to ensure that, to the extent determined appropriate 

for each acquisition program, such technologies and treatments 

are incorporated into that program, particularly during the engineering and design phases of the acquisition process. 

(c) ADDITIONAL AUTHORITIES FOR DIRECTOR.—The Director is 

authorized to— 

(1) develop, update, and coordinate corrosion training with 

the Defense Acquisition University; 

(2) participate in the process within the Department of Defense for the development of relevant directives and instructions; and 

(3) interact directly with the corrosion prevention industry, 

trade associations, other government corrosion prevention 

agencies, academic research and educational institutions, and 

scientific organizations engaged in corrosion prevention, including the National Academy of Sciences. 

(d) LONG-TERM STRATEGY.—(1) The Secretary of Defense shall 

develop and implement a long-term strategy to reduce corrosion 

and the effects of corrosion on the military equipment and infrastructure of the Department of Defense. 

(2) The strategy under paragraph (1) shall include the following: 

(A) Expansion of the emphasis on corrosion prevention and 

mitigation within the Department of Defense to include coverage of infrastructure. 

(B) Application uniformly throughout the Department of 

Defense of requirements and criteria for the testing and certification of new corrosion-prevention technologies for equipment 

and infrastructure with similar characteristics, similar missions, or similar operating environments. 

(C) Implementation of programs, including supporting 

databases, to ensure that a focused and coordinated approach 

is taken throughout the Department of Defense to collect, review, validate, and distribute information on proven methods 

and products that are relevant to the prevention of corrosion 

of military equipment and infrastructure. 
1103 § 2228 CH. 131—PLANNING AND COORDINATION 

(D) Establishment of a coordinated research and development program for the prevention and mitigation of corrosion 

for new and existing military equipment and infrastructure 

that includes a plan to transition new corrosion prevention 

technologies into operational systems, including through the 

establishment of memoranda of agreement, joint funding 

agreements, public-private partnerships, university research 

and education centers, and other cooperative research agreements. 

(3) The strategy shall include, for the matters specified in 

paragraph (2), the following: 

(A) Policy guidance. 

(B) Performance measures and milestones. 

(C) An assessment of the necessary personnel and funding 

necessary to accomplish the long-term strategy. 

(e) REPORT.—(1) For each budget for a fiscal year, beginning 

with the budget for fiscal year 2009, the Secretary of Defense shall 

submit, with the defense budget materials, a report on the following: 

(A) Funding requirements for the long-term strategy developed under subsection (d). 

(B) The return on investment that would be achieved by 

implementing the strategy. 

(C) For the fiscal year covered by the report and the preceding fiscal year, the funds requested in the budget compared 

to the funding requirements. 

(D) An explanation if the funding requirements are not 

fully funded in the budget. 

(E) For the fiscal year covered by the report and the preceding fiscal year, the amount of funds requested in the budget 

for each project or activity described in subsection (d) compared 

to the funding requirements for the project or activity. 

(2) Within 60 days after submission of the budget for a fiscal 

year, the Comptroller General shall provide to the congressional 

defense committees— 

(A) an analysis of the budget submission for corrosion control and prevention by the Department of Defense; and 

(B) an analysis of the report required under paragraph (1), 

including the annex to the report described in paragraph (3). 

(3) Each report under this section shall include, in an annex 

to the report, a copy of the annual corrosion report most recently 

submitted by the corrosion control and prevention executive of each 

military department under section 903(b)(5) of the Duncan Hunter 

National Defense Authorization Act for Fiscal Year 2009 (Public 

Law 110–417; 122 Stat. 4567; 10 U.S.C. 2228 note). 

(f) DEFINITIONS.—In this section: 

(1) The term ‘‘corrosion’’ means the deterioration of a material or its properties due to a reaction of that material with 

its chemical environment. 

(2) The term ‘‘military equipment’’ includes all weapon systems, weapon platforms, vehicles, and munitions of the Department of Defense, and the components of such items. 

(3) The term ‘‘infrastructure’’ includes all buildings, structures, airfields, port facilities, surface and subterranean utility 
§ 2229 CH. 131—PLANNING AND COORDINATION 1104 

systems, heating and cooling systems, fuel tanks, pavements, 

and bridges. 

(4) The term ‘‘budget’’, with respect to a fiscal year, means 

the budget for that fiscal year that is submitted to Congress 

by the President under section 1105(a) of title 31. 

(5) The term ‘‘defense budget materials’’, with respect to a 

fiscal year, means the materials submitted to Congress by the 

Secretary of Defense in support of the budget for that fiscal 

year. 

(Added Pub. L. 107–314, div. A, title X, Sec. 1067(a)(1), Dec. 2, 2002, 116 Stat. 2657; amended 

Pub. L. 110–181, div. A, title III, Sec. 371(a)–(e), Jan. 28, 2008, 122 Stat. 79–81; Pub. L. 110– 

417, [div. A], title X, Sec. 1061(b)(1), Oct. 14, 2008, 122 Stat. 4612; Pub. L. 111–383, div. A, 

title III, Sec. 331, Jan. 7, 2011, 124 Stat. 4185.) 

§ 2229. Strategic policy on prepositioning of materiel and 

equipment 

(a) POLICY REQUIRED.—The Secretary of Defense shall maintain a strategic policy on the programs of the Department of Defense for the prepositioning of materiel and equipment. Such policy 

shall take into account national security threats, strategic mobility, 

service requirements, and the requirements of the combatant commands. 

(b) LIMITATION OF DIVERSION OF PREPOSITIONED MATERIEL.— 

The Secretary of a military department may not divert materiel or 

equipment from prepositioned stocks except— 

(1) in accordance with a change made by the Secretary of 

Defense to the policy maintained under subsection (a); or 

(2) for the purpose of directly supporting a contingency operation or providing humanitarian assistance under chapter 20 

of this title. 

(c) CONGRESSIONAL NOTIFICATION.—The Secretary of Defense 

may not implement or change the policy required under subsection 

(a) until the Secretary submits to the congressional defense committees a report describing the policy or change to the policy. 

(Added Pub. L. 109–364, div. A, title III, Sec. 351(a), Oct. 17, 2006, 120 Stat. 2160.) 

§ 2229a. Annual report on prepositioned materiel and equipment 

(a) ANNUAL REPORT REQUIRED.—Not later than the date of the 

submission of the President’s budget request for a fiscal year under 

section 1105 of title 31, the Secretary of Defense shall submit to 

the congressional defense committees a report on the status of the 

materiel in the prepositioned stocks as of the end of the fiscal year 

preceding the fiscal year during which the report is submitted. 

Each report shall be unclassified and may contain a classified 

annex. Each report shall include the following information: 

(1) The level of fill for major end items of equipment and 

spare parts in each prepositioned set as of the end of the fiscal 

year covered by the report. 

(2) The material condition of equipment in the 

prepositioned stocks as of the end of such fiscal year, grouped 

by category or major end item. 

(3) A list of major end items of equipment drawn from the 

prepositioned stocks during such fiscal year and a description 
1105 § 2229a CH. 131—PLANNING AND COORDINATION 

of how that equipment was used and whether it was returned 

to the stocks after being used. 

(4) A timeline for completely reconstituting any shortfall in 

the prepositioned stocks. 

(5) An estimate of the amount of funds required to completely reconstitute any shortfall in the prepositioned stocks 

and a description of the Secretary’s plan for carrying out such 

complete reconstitution. 

(6) A list of any operations plan affected by any shortfall 

in the prepositioned stocks and a description of any action 

taken to mitigate any risk that such a shortfall may create. 

(b) COMPTROLLER GENERAL REVIEW.—(1) By not later than 120 

days after the date on which a report is submitted under subsection (a), the Comptroller General shall review the report and, as 

the Comptroller General determines appropriate, submit to the 

congressional defense committees any additional information that 

the Comptroller General determines will further inform such committees on issues relating to the status of the materiel in the 

prepositioned stocks. 

(2) The Secretary of Defense shall ensure the full cooperation 

of the Department of Defense with the Comptroller General for 

purposes of the conduct of the review required by this subsection, 

both before and after each report is submitted under subsection (a). 

The Secretary shall conduct periodic briefings for the Comptroller 

General on the information covered by each report required under 

subsection (a) and provide to the Comptroller General access to the 

data and preliminary results to be used by the Secretary in preparing each such report before the Secretary submits the report to 

enable the Comptroller General to conduct each review required 

under paragraph (1) in a timely manner. 

(3) The requirement to conduct a review under this subsection 

shall terminate on September 30, 2015. 

(Added Pub. L. 110–181, div. A, title III, Sec. 352(a), Jan. 28, 2008, 122 Stat. 71.) 
1106 

CHAPTER 133—FACILITIES FOR RESERVE COMPONENTS 

Sec. 

2231. Reference to chapter 1803. 

§ 2231. Reference to chapter 1803 

Provisions of law relating to facilities for reserve components 

are set forth in chapter 1803 of this title (beginning with section 

18231). 

(Added Pub. L. 103–337, div. A, title XVI, Sec. 1664(b)(11), Oct. 5, 1994, 108 Stat. 3011.) 
1107 

CHAPTER 134—MISCELLANEOUS ADMINISTRATIVE 

PROVISIONS 

Subchapter Sec. 

I. Miscellaneous Authorities, Prohibitions, and Limitations on the Use 

of Appropriated Funds ........................................................................... 2241 

II. Miscellaneous Administrative Authority .................................................. 2251 

SUBCHAPTER I—MISCELLANEOUS AUTHORITIES, PROHIBITIONS, AND LIMITATIONS ON THE USE OF APPROPRIATED FUNDS 

Sec. 

2241. Availability of appropriations for certain purposes. 

2241a. Prohibition on use of funds for publicity or propaganda purposes within 

the United States. 

2242. Authority to use appropriated funds for certain investigations and security 

services. 

2243. Authority to use appropriated funds to support student meal programs in 

overseas dependents’ schools. 

2244. Security investigations. 

2244a. Equipment scheduled for retirement or disposal: limitation on expenditures for modifications. 

2245. Use of aircraft for proficiency flying: limitation. 

2245a. Use of operation and maintenance funds for purchase of investment items: 

limitation. 

[2246 to 2248. Renumbered or Repealed.] 

2249. Prohibition on use of funds for documenting economic or employment impact of certain acquisition programs. 

2249a. Prohibition on providing financial assistance to terrorist countries. 

2249b. Display of State flag: prohibition on use of funds to arbitrarily exclude 

flag; position and manner of display. 

2249c. Regional Defense Combating Terrorism Fellowship Program: authority to 

use appropriated funds for costs associated with education and training 

of foreign officials. 

2249d. Distribution to certain foreign personnel of education and training materials and information technology to enhance military interoperability 

with the armed forces. 

§ 2241. Availability of appropriations for certain purposes 

(a) OPERATION AND MAINTENANCE APPROPRIATIONS.—Amounts 

appropriated to the Department of Defense for operation and maintenance of the active forces may be used for the following purposes: 

(1) Morale, welfare, and recreation. 

(2) Modification of personal property. 

(3) Design of vessels. 

(4) Industrial mobilization. 

(5) Military communications facilities on merchant vessels. 

(6) Acquisition of services, special clothing, supplies, and 

equipment. 

(7) Expenses for the Reserve Officers’ Training Corps and 

other units at educational institutions. 

(b) NECESSARY EXPENSES.—Amounts appropriated to the Department of Defense may be used for all necessary expenses, at the 
§ 2241a CH. 134—MISC. ADMINISTRATIVE PROVISIONS 1108 

seat of the Government or elsewhere, in connection with communication and other services and supplies that may be necessary for 

the national defense. 

(c) ACTIVITIES OF THE NATIONAL COMMITTEE FOR EMPLOYER

SUPPORT OF THE GUARD AND RESERVE.—Amounts appropriated for 

operation and maintenance may, under regulations prescribed by 

the Secretary of Defense, be used by the Secretary for official reception, representation, and advertising activities and materials of the 

National Committee for Employer Support of the Guard and Reserve to further employer commitments to their employees who are 

members of a reserve component. 

(Added Pub. L. 100–370, Sec. 1(e)(1), July 19, 1988, 102 Stat. 844; amended Pub. L. 108–136, 

div. A, title V, Sec. 518, Nov. 24, 2003, 117 Stat. 1462.) 

§ 2241a. Prohibition on use of funds for publicity or propaganda purposes within the United States 

Funds available to the Department of Defense may not be obligated or expended for publicity or propaganda purposes within the 

United States not otherwise specifically authorized by law. 

(Added Pub. L. 111–84, div. A, title X, Sec. 1031(a)(1), Oct. 28, 2009, 123 Stat. 2448.) 

§ 2242. Authority to use appropriated funds for certain investigations and security services 

The Secretary of Defense and the Secretary of each military 

department may— 

(1) pay in advance for the expenses of conducting investigations in foreign countries incident to matters relating to 

the Department of Defense, to the extent such expenses are determined by the investigating officer to be necessary and in accord with local custom; 

(2) pay expenses incurred in connection with the administration of occupied areas; 

(3) pay expenses of military courts, boards, and commissions; and 

(4) reimburse the Administrator of General Services for security guard services furnished by the Administrator to the Department of Defense for the protection of confidential files. 

(Added Pub. L. 100–370, Sec. 1(e)(1), July 19, 1988, 102 Stat. 844.) 

§ 2243. Authority to use appropriated funds to support student meal programs in overseas dependents’ 

schools 

(a) AUTHORITY.—Subject to subsection (b), amounts appropriated to the Department of Defense for the operation of the defense dependents’ education system may be used by the Secretary 

of Defense to enable an overseas meal program to provide students 

enrolled in that system with meals at a price equal to the average 

price paid by students for equivalent meals under a comparable 

public school meal program in the United States. 

(b) LIMITATION.—The authority provided by subsection (a) may 

be used only if the Secretary of Defense determines that Federal 

payments and commodities provided under section 20 of the Richard B. Russell National School Lunch Act (42 U.S.C. 1769b) and 

section 20 of the Child Nutrition Act of 1966 (42 U.S.C. 1789) to 
1109 § 2244a CH. 134—MISC. ADMINISTRATIVE PROVISIONS 

support an overseas meal program are insufficient to provide meals 

under that program at a price for students equal to the average 

price paid by students for equivalent meals under a comparable 

public school meal program in the United States. 

(c) DETERMINING AVERAGE PRICE.—In determining the average 

price paid by students in the United States for meals under a 

school meal program, the Secretary of Defense shall exclude free 

and reduced price meals provided pursuant to income guidelines. 

(d) OVERSEAS MEAL PROGRAM DEFINED.—In this section, the 

term ‘‘overseas meal program’’ means a program administered by 

the Secretary of Defense to provide breakfasts or lunches to students attending Department of Defense dependents’ schools which 

are located outside the United States. 

(Added Pub. L. 101–189, div. A, title III, Sec. 326(a), Nov. 29, 1989, 103 Stat. 1415; amended 

Pub. L. 106–78, title VII, Sec. 752(b)(7), Oct. 22, 1999, 113 Stat. 1169.) 

§ 2244. Security investigations 

(a) Funds appropriated to the Department of Defense may not 

be used for the conduct of an investigation by the Department of 

Defense, or by any other Federal department or agency, for purposes of determining whether to grant a security clearance to an 

individual or a facility unless the Secretary of Defense determines 

both of the following: 

(1) That a current, complete investigation file is not available from any other department or agency of the Federal Government with respect to that individual or facility. 

(2) That no other department or agency of the Federal 

Government is conducting an investigation with respect to that 

individual or facility that could be used as the basis for determining whether to grant the security clearance. 

(b) For purposes of subsection (a)(1), a current investigation 

file is a file on an investigation that has been conducted within the 

past five years. 

(Added Pub. L. 101–510, div. A, title IX, Sec. 904(a), Nov. 5, 1990, 104 Stat. 1621; amended 

Pub. L. 102–190, div. A, title X, Sec. 1061(a)(11), Dec. 5, 1991, 105 Stat. 1473.) 

§ 2244a. Equipment scheduled for retirement or disposal: 

limitation on expenditures for modifications 

(a) PROHIBITION.—Except as otherwise provided in this section, 

the Secretary of a military department may not carry out a modification of an aircraft, weapon, vessel, or other item of equipment 

that the Secretary plans to retire or otherwise dispose of within 

five years after the date on which the modification, if carried out, 

would be completed. 

(b) EXCEPTIONS.— 

(1) EXCEPTION FOR BELOW-THRESHOLD MODIFICATIONS.— 

The prohibition in subsection (a) does not apply to a modification for which the cost is less than $100,000. 

(2) EXCEPTION FOR TRANSFER OF REUSABLE ITEMS OF

VALUE.—The prohibition in subsection (a) does not apply to a 

modification in a case in which— 

(A) the reusable items of value, as determined by the 

Secretary, installed on the item of equipment as part of 

such modification will, upon the retirement or disposal of 
§ 2245 CH. 134—MISC. ADMINISTRATIVE PROVISIONS 1110 

the item to be modified, be removed from such item of 

equipment, refurbished, and installed on another item of 

equipment; and 

(B) the cost of such modification (including the cost of 

the removal and refurbishment of reusable items of value 

under subparagraph (A)) is less than $1,000,000. 

(3) EXCEPTION FOR SAFETY MODIFICATIONS.—The prohibition in subsection (a) does not apply to a safety modification. 

(c) WAIVER AUTHORITY.—The Secretary concerned may waive 

the prohibition in subsection (a) in the case of any modification otherwise subject to that subsection if the Secretary determines that 

carrying out the modification is in the national security interest of 

the United States. Whenever the Secretary issues such a waiver, 

the Secretary shall notify the congressional defense committees in 

writing. 

(Added Pub. L. 109–163, div. A, title III, Sec. 372(a), Jan. 6, 2006, 119 Stat. 3209.) 

§ 2245. Use of aircraft for proficiency flying: limitation 

(a) An aircraft under the jurisdiction of a military department 

may not be used by a member of the armed forces for the purpose 

of proficiency flying except in accordance with regulations prescribed by the Secretary of Defense. 

(b) Such regulations— 

(1) may not require proficiency flying by a member except 

to the extent required for the member to maintain flying proficiency in anticipation of the member’s assignment to combat 

operations; and 

(2) may not permit proficiency flying in the case of a member who is assigned to a course of instruction of 90 days or 

more. 

(c) In this section, the term ‘‘proficiency flying’’ means flying 

performed under competent orders by a rated or designated member of the armed forces while serving in a non-aviation assignment 

or in an assignment in which skills would normally not be maintained in the performance of assigned duties. 

(Added Pub. L. 101–510, div. A, title XIV, Sec. 1481(e)(1), Nov. 5, 1990, 104 Stat. 1706; amended 

Pub. L. 110–181, div. A, title X, Sec. 1077, Jan. 28, 2008, 122 Stat. 333.) 

§ 2245a. Use of operation and maintenance funds for purchase of investment items: limitation 

Funds appropriated to the Department of Defense for operation 

and maintenance may not be used to purchase any item (including 

any item to be acquired as a replacement for an item) that has an 

investment item unit cost that is greater than $250,000. 

(Added Pub. L. 109–163, div. A, title III, Sec. 373(a), Jan. 6, 2006, 119 Stat. 3210.) 

[§ 2246. Renumbered 2491a] 

[§ 2247. Renumbered 2491b] 

[§ 2248. Repealed. Pub. L. 108–136, div. A, title X, Sec. 

1045(a)(5)(A), Nov. 24, 2003, 117 Stat. 1612] 
1111 § 2249a CH. 134—MISC. ADMINISTRATIVE PROVISIONS 

§ 2249. Prohibition on use of funds for documenting economic or employment impact of certain acquisition 

programs 

No funds appropriated by the Congress may be obligated or expended to assist any contractor of the Department of Defense in 

preparing any material, report, lists, or analysis with respect to the 

actual or projected economic or employment impact in a particular 

State or congressional district of an acquisition program for which 

all research, development, testing, and evaluation has not been 

completed. 

(Added Pub. L. 103–355, title VII, Sec. 7202(a)(1), Oct. 13, 1994, 108 Stat. 3379, Sec. 2247; renumbered Sec. 2249, Pub. L. 104–106, div. D, title XLIII, Sec. 4321(b)(2)(A), Feb. 10, 1996, 110 

Stat. 672.) 

§ 2249a. Prohibition on providing financial assistance to terrorist countries 

(a) PROHIBITION.—Funds available to the Department of Defense may not be obligated or expended to provide financial assistance to— 

(1) any country with respect to which the Secretary of 

State has made a determination under section 6(j)(1)(A) of the 

Export Administration Act of 1979 (50 U.S.C. App. 

2405(j)(1)(A)); 

(2) any country identified in the latest report submitted to 

Congress under section 140 of the Foreign Relations Authorization Act, Fiscal Years 1988 and 1989 (22 U.S.C. 2656f), as providing significant support for international terrorism; or 

(3) any other country that, as determined by the President— 

(A) grants sanctuary from prosecution to any individual or group that has committed an act of international 

terrorism; or 

(B) otherwise supports international terrorism. 

(b) WAIVER.—(1) The President may waive the application of 

subsection (a) to a country if the President determines— 

(A) that it is in the national security interests of the 

United States to do so; or 

(B) that the waiver should be granted for humanitarian 

reasons. 

(2) The President shall— 

(A) notify the Committee on Armed Services and the Committee on Foreign Relations of the Senate and the Committee 

on Armed Services and the Committee on International Relations of the House of Representatives at least 15 days before 

the waiver takes effect; and 

(B) publish a notice of the waiver in the Federal Register. 

(c) DEFINITION.—In this section, the term ‘‘international terrorism’’ has the meaning given that term in section 140(d) of the 

Foreign Relations Authorization Act, Fiscal Years 1988 and 1989 

(22 U.S.C. 2656f(d)). 

(Added Pub. L. 104–106, div. A, title XIII, Sec. 1341(a), Feb. 10, 1996, 110 Stat. 485; amended 

Pub. L. 105–85, div. A, title X, Sec. 1073(a)(40), Nov. 18, 1997, 111 Stat. 1902; Pub. L. 106– 

65, div. A, title X, Sec. 1067(1), Oct. 5, 1999, 113 Stat. 774.) 
§ 2249b CH. 134—MISC. ADMINISTRATIVE PROVISIONS 1112 

§ 2249b. Display of State flags: prohibition on use of funds to 

arbitrarily exclude flag; position and manner of 

display 

(a) PROHIBITION ON USE OF FUNDS.—Funds available to the 

Department of Defense may not be used to prescribe or enforce any 

rule that arbitrarily excludes the official flag of any State, territory, 

or possession of the United States from any display of the flags of 

the States, territories, and possessions of the United States at an 

official ceremony of the Department of Defense. 

(b) POSITION AND MANNER OF DISPLAY.—The display of an official flag of a State, territory, or possession of the United States at 

an installation or other facility of the Department shall be governed by section 7 of title 4 and any modification of section 7 under 

section 10 of title 4. 

(Added Pub. L. 104–201, div. A, title X, Sec. 1071(a), Sept. 23, 1996, 110 Stat. 2656; amended 

Pub. L. 105–225, Sec. 4(a)(1), Aug. 12, 1998, 112 Stat. 1498.) 

§ 2249c. Regional Defense Combating Terrorism Fellowship 

Program: authority to use appropriated funds for 

costs associated with education and training of foreign officials 

(a) AUTHORITY TO USE FUNDS.—Under regulations prescribed 

by the Secretary of Defense, funds appropriated to the Department 

of Defense may be used to pay any costs associated with the education and training of foreign military officers, ministry of defense 

officials, or security officials at military or civilian educational institutions, regional centers, conferences, seminars, or other training 

programs conducted under the Regional Defense Combating Terrorism Fellowship Program. Costs for which payment may be made 

under this section include the costs of transportation and travel 

and subsistence costs. 

(b) LIMITATION.—The total amount of funds used under the authority in subsection (a) in any fiscal year may not exceed 

$35,000,000. Amounts available under the authority in subsection 

(a) for a fiscal year may be used for programs that begin in such 

fiscal year but end in the next fiscal year. 

(c) ANNUAL REPORT.—Not later than December 1 of each year, 

the Secretary of Defense shall submit to Congress a report on the 

administration of this section during the fiscal year ended in such 

year. The report shall include the following matters: 

(1) A complete accounting of the expenditure of appropriated funds for purposes authorized under subsection (a), including— 

(A) the countries of the foreign officers and officials for 

whom costs were paid; and 

(B) for each such country, the total amount of the 

costs paid. 

(2) The training courses attended by the foreign officers 

and officials, including a specification of which, if any, courses 

were conducted in foreign countries. 

(3) An assessment of the effectiveness of the program referred to in subsection (a) in increasing the cooperation of the 

governments of foreign countries with the United States in the 

global war on terrorism. 
1113 § 2249d CH. 134—MISC. ADMINISTRATIVE PROVISIONS 

(4) A discussion of any actions being taken to improve the 

program. 

(Added Pub. L. 108–136, div. A, title XII, Sec. 1221(a)(1), Nov. 24, 2003, 117 Stat. 1651; Pub. 

L. 109–364, div. A, title XII, Sec. 1204(a)–(d)(2), Oct. 17, 2006, 120 Stat. 2415; Pub. L. 110– 

417, [div. A], title XII, Sec. 1209(a), Oct. 14, 2008, 122 Stat. 4627.) 

§ 2249d. Distribution to certain foreign personnel of education and training materials and information 

technology to enhance military interoperability 

with the armed forces 

(a) DISTRIBUTION AUTHORIZED.—To enhance interoperability 

between the armed forces and military forces of friendly foreign nations, the Secretary of Defense, with the concurrence of the Secretary of State, may— 

(1) provide to personnel referred to in subsection (b) electronically-distributed learning content for the education and 

training of such personnel for the development or enhancement 

of allied and friendly military and civilian capabilities for multinational operations, including joint exercises and coalition operations; and 

(2) provide information technology, including computer 

software developed for such purpose, but only to the extent 

necessary to support the use of such learning content for the 

education and training of such personnel. 

(b) AUTHORIZED RECIPIENTS.—The personnel to whom learning 

content and information technology may be provided under subsection (a) are military and civilian personnel of a friendly foreign 

government, with the permission of that government. 

(c) EDUCATION AND TRAINING.—Any education and training 

provided under subsection (a) shall include the following: 

(1) Internet-based education and training. 

(2) Advanced distributed learning and similar Internet 

learning tools, as well as distributed training and computer-assisted exercises. 

(d) APPLICABILITY OF EXPORT CONTROL REGIMES.—The provision of learning content and information technology under this section shall be subject to the provisions of the Arms Export Control 

Act (22 U.S.C. 2751 et seq.) and any other export control regime 

under law relating to the transfer of military technology to foreign 

nations. 

(e) GUIDANCE ON UTILIZATION OF AUTHORITY.— 

(1) GUIDANCE REQUIRED.—The Secretary of Defense shall 

develop and issue guidance on the procedures for the use of the 

authority in this section. 

(2) MODIFICATION.—If the Secretary modifies the guidance 

issued under paragraph (1), the Secretary shall submit to the 

appropriate committees of Congress a report setting forth the 

modified guidance not later than 30 days after the date of such 

modification. 

(f) ANNUAL REPORT.— 

(1) REPORT REQUIRED.—Not later than October 31 following each fiscal year in which the authority in this section 

is used, the Secretary of Defense shall submit to the appro-
§ 2251 CH. 134—MISC. ADMINISTRATIVE PROVISIONS 1114 

priate committees of Congress a report on the exercise of the 

authority during such fiscal year. 

(2) ELEMENTS.—Each report under paragraph (1) shall include, for the fiscal year covered by such report, the following: 

(A) A statement of the recipients of learning content 

and information technology provided under this section. 

(B) A description of the type, quantity, and value of 

the learning content and information technology provided 

under this section. 

(g) APPROPRIATE COMMITTEES OF CONGRESS DEFINED.—In this 

section, the term ‘‘appropriate committees of Congress’’ means— 

(1) the Committee on Armed Services and the Committee 

on Foreign Relations of the Senate; and 

(2) the Committee on Armed Services and the Committee 

on Foreign Affairs of the House of Representatives. 

(Added Pub. L. 110–417, [div. A], title XII, Sec. 1205(a)(1), Oct. 14, 2008, 122 Stat. 4623.) 

SUBCHAPTER II—MISCELLANEOUS ADMINISTRATIVE 

AUTHORITY 

Sec. 

2251. Household furnishings and other property: personnel outside the United 

States or in Alaska or Hawaii. 

2252. Rewards: missing property. 

2253. Motor vehicles. 

2254. Treatment of reports of aircraft accident investigations. 

2255. Aircraft accident investigation boards: composition requirements. 

2257. Use of recruiting materials for public relations. 

2259. Transit pass program: personnel in poor air quality areas. 

2260. Licensing of intellectual property: retention of fees. 

2261. Presentation of recognition items for recruitment and retention purposes. 

2262. Department of Defense conferences: collection of fees to cover Department 

of Defense costs. 

2263. United States contributions to the North Atlantic Treaty Organization 

common-funded budgets. 

§ 2251. Household furnishings and other property: personnel outside the United States or in Alaska or 

Hawaii 

(a) IN GENERAL.—Subject to subsection (b), the Secretary of the 

military department concerned may— 

(1) purchase household furnishings and automobiles from 

members of the armed forces and civilian employees of the Department of Defense on duty outside the United States or in 

Hawaii for resale at cost to incoming personnel; and 

(2) provide household furnishings, without charge, in other 

than public quarters occupied by members of the armed forces 

or civilian employees of the Department of Defense who are on 

duty outside the United States or in Alaska or Hawaii. 

(b) REQUIRED DETERMINATION.—The authority provided in subsection (a) may be used only when it is determined, under regulations approved by the Secretary of Defense, that the use of that authority would be advantageous to the United States. 

(Added Pub. L. 100–370, Sec. 1(e)(1), July 19, 1988, 102 Stat. 845.) 
1115 § 2254 CH. 134—MISC. ADMINISTRATIVE PROVISIONS 

§ 2252. Rewards: missing property 

The Secretary of Defense and the Secretary of each military department may pay a reward of not more than $500 in any case 

for information leading to the discovery of missing property under 

the jurisdiction of that Secretary or leading to the recovery of such 

property. 

(Added Pub. L. 100–370, Sec. 1(e)(1), July 19, 1988, 102 Stat. 845.) 

§ 2253. Motor vehicles 

(a) GENERAL AUTHORITIES.—The Secretary of Defense and the 

Secretary of each military department may— 

(1) provide for insurance of official motor vehicles in a foreign country when the laws of such country require such insurance; and 

(2) purchase right-hand drive vehicles at a cost of not more than $30,000 each. 

(b) HIRE OF PASSENGER VEHICLES.—Amounts appropriated to 

the Department of Defense for operation and maintenance of the 

active forces may be used for the hire of passenger motor vehicles. 

(Added Pub. L. 100–370, Sec. 1(e)(1), July 19, 1988, 102 Stat. 845; Pub. L. 105–85, div. A, title 

VIII , Sec. 805, Nov. 18, 1997, 111 Stat. 1834.) 

§ 2254. Treatment of reports of aircraft accident investigations 

(a) IN GENERAL.—(1) Whenever the Secretary of a military department conducts an accident investigation of an accident involving an aircraft under the jurisdiction of the Secretary, the records 

and report of the investigations shall be treated in accordance with 

this section. 

(2) For purposes of this section, an accident investigation is 

any form of investigation of an aircraft accident other than an investigation (known as a ‘‘safety investigation’’) that is conducted 

solely to determine the cause of the accident and to obtain information that may prevent the occurrence of similar accidents. 

(b) PUBLIC DISCLOSURE OF CERTAIN ACCIDENT INVESTIGATION

INFORMATION.—(1) The Secretary concerned, upon request, shall 

publicly disclose unclassified tapes, scientific reports, and other factual information pertinent to an aircraft accident investigation, before the release of the final accident investigation report relating 

to the accident, if the Secretary concerned determines— 

(A) that such tapes, reports, or other information would be 

included within and releasable with the final accident investigation report; and 

(B) that release of such tapes, reports, or other information— 

(i) would not undermine the ability of accident or safety investigators to continue to conduct the investigation; 

and 

(ii) would not compromise national security. 

(2) A disclosure under paragraph (1) may not be made by or 

through officials with responsibility for, or who are conducting, a 

safety investigation with respect to the accident. 

(c) OPINIONS REGARDING CAUSATION OF ACCIDENT.—Following 

a military aircraft accident— 
§ 2255 CH. 134—MISC. ADMINISTRATIVE PROVISIONS 1116 

(1) if the evidence surrounding the accident is sufficient for 

the investigators who conduct the accident investigation to 

come to an opinion (or opinions) as to the cause or causes of 

the accident, the final report of the accident investigation shall 

set forth the opinion (or opinions) of the investigators as to the 

cause or causes of the accident; and 

(2) if the evidence surrounding the accident is not sufficient for those investigators to come to an opinion as to the 

cause or causes of the accident, the final report of the accident 

investigation shall include a description of those factors, if any, 

that, in the opinion of the investigators, substantially contributed to or caused the accident. 

(d) USE OF INFORMATION IN CIVIL PROCEEDINGS.—For purposes 

of any civil or criminal proceeding arising from an aircraft accident, 

any opinion of the accident investigators as to the cause of, or the 

factors contributing to, the accident set forth in the accident investigation report may not be considered as evidence in such proceeding, nor may such information be considered an admission of 

liability by the United States or by any person referred to in those 

conclusions or statements. 

(e) REGULATIONS.—The Secretary of each military department 

shall prescribe regulations to carry out this section. 

(Added Pub. L. 102–484, div. A, title X, Sec. 1071(a)(1), Oct. 23, 1992, 106 Stat. 2507.) 

§ 2255. Aircraft accident investigation boards: composition 

requirements 

(a) REQUIRED MEMBERSHIP OF BOARDS.—Whenever the Secretary of a military department convenes an aircraft accident investigation board to conduct an accident investigation (as described 

in section 2254(a)(2) of this title) with respect to a Class A accident 

involving an aircraft under the jurisdiction of the Secretary, the 

Secretary shall select the membership of the board so that— 

(1) a majority of the members (or in the case of a board 

consisting of a single member, the member) is selected from 

units other than the mishap unit or a unit subordinate to the 

mishap unit; and 

(2) in the case of a board consisting of more than one member, at least one member of the board is a member of the 

armed forces or an officer or an employee of the Department 

of Defense who possesses knowledge and expertise relevant to 

aircraft accident investigations. 

(b) EXCEPTION.—The Secretary of the military department concerned may waive the requirement of subsection (a)(1) in the case 

of an aircraft accident if the Secretary determines that— 

(1) it is not practicable to meet the requirement because 

of— 

(A) the remote location of the aircraft accident; 

(B) an urgent need to promptly begin the investigation; or 

(C) a lack of available persons outside of the mishap 

unit who have adequate knowledge and expertise regarding the type of aircraft involved in the accident; and 

(2) the objectivity and independence of the aircraft accident investigation board will not be compromised. 
1117 § 2259 CH. 134—MISC. ADMINISTRATIVE PROVISIONS 

(c) CONSULTATION REQUIREMENT.—In the case of an aircraft 

accident investigation board consisting of a single member, the 

member shall consult with a member of the armed forces or an officer or an employee of the Department of Defense who possesses 

knowledge and expertise relevant to aircraft accident investigations. 

(d) DESIGNATION OF CLASS A ACCIDENTS.—Not later than 60 

days after an aircraft accident involving an aircraft under the jurisdiction of the Secretary of a military department, the Secretary 

shall determine whether the aircraft accident should be designated 

as a Class A accident for purposes of this section. 

(e) DEFINITIONS.—In this section: 

(1) The term ‘‘Class A accident’’ means an accident involving an aircraft that results in— 

(A) the loss of life or permanent disability; 

(B) damages to the aircraft, other property, or a combination of both, in an amount in excess of the amount 

specified by the Secretary of Defense for purposes of determining Class A accidents; or 

(C) the destruction of the aircraft. 

(2) The term ‘‘mishap unit’’, with respect to an aircraft accident investigation, means the unit of the armed forces (at the 

squadron or battalion level or equivalent) to which was assigned the flight crew of the aircraft that sustained the accident that is the subject of the investigation. 

(Added Pub. L. 104–201, div. A, title IX, Sec. 911(a)(1), Sept. 23, 1996, 110 Stat. 2621; amended 

Pub. L. 108–136, div. A, title X, Sec. 1031(a)(13), Nov. 24, 2003, 117 Stat. 1597.) 

§ 2257. Use of recruiting materials for public relations 

The Secretary of Defense may use for public relations purposes 

of the Department of Defense any advertising materials developed 

for use for recruitment and retention of personnel for the armed 

forces. Any such use shall be under such conditions and subject to 

such restrictions as the Secretary of Defense shall prescribe. 

(Added Pub. L. 106–65, div. A, title V, Sec. 574(a), Oct. 5, 1999, 113 Stat. 624.) 

§ 2259. Transit pass program: personnel in poor air quality 

areas 

(a) ESTABLISHMENT OF PROGRAM.—To encourage Department 

of Defense personnel assigned to duty, or employed, in poor air 

quality areas to use means other than single-occupancy motor vehicles to commute to or from the location of their duty assignments, 

the Secretary of Defense shall exercise the authority provided in 

section 7905 of title 5 to establish a program to provide a transit 

pass benefit under subsection (b)(2)(A) of that section for members 

of the Army, Navy, Air Force, and Marine Corps who are assigned 

to duty, and to Department of Defense civilian officers and employees who are employed, in a poor air quality area. 

(b) POOR AIR QUALITY AREAS.—In this section, the term ‘‘poor 

air quality area’’ means an area— 

(1) that is subject to the national ambient air quality 

standards promulgated by the Administrator of the Environmental Protection Agency under section 109 of the Clean Air 

Act (42 U.S.C. 7409); and 
§ 2260 CH. 134—MISC. ADMINISTRATIVE PROVISIONS 1118 

(2) that, as determined by the Administrator of the Environmental Protection Agency, is a nonattainment area with respect to any of those standards. 

(Added Pub. L. 106–398, Sec. 1 [[div. A], title X, Sec. 1082(a)(1)], Oct. 30, 2000, 114 Stat. 1654, 

1654A–285.) 

§ 2260. Licensing of intellectual property: retention of fees 

(a) AUTHORITY.—Under regulations prescribed by the Secretary 

of Defense or the Secretary of Homeland Security, the Secretary 

concerned may license trademarks, service marks, certification 

marks, and collective marks owned or controlled by the Secretary 

concerned and may retain and expend fees received from such licensing in accordance with this section. 

(b) DESIGNATED MARKS.—The Secretary concerned shall designate the trademarks, service marks, certification marks, and collective marks regarding which the Secretary will exercise the authority to retain licensing fees under this section. 

(c) LICENSES FOR QUALIFYING COMPANIES.—(1) The Secretary 

concerned may license trademarks, service marks, certification 

marks, and collective marks owned or controlled by the Secretary 

relating to military designations and likenesses of military weapons systems to any qualifying company upon receipt of a request 

from the company. 

(2) For purposes of paragraph (1), a qualifying company is any 

United States company that— 

(A) is a toy or hobby manufacturer; and 

(B) is determined by the Secretary concerned to be qualified in accordance with such criteria as determined appropriate 

by the Secretary of Defense. 

(3) The fee for a license under this subsection shall not exceed 

by more than a nominal amount the amount needed to recover all 

costs of the Department of Defense in processing the request for 

the license and supplying the license. 

(4) A license to a qualifying company under this subsection 

shall provide that the license may not be transferred, sold, or relicensed by the qualifying company. 

(5) A license under this subsection shall not be an exclusive license. 

(d) USE OF FEES.—The Secretary concerned shall use fees retained under this section for the following purposes: 

(1) For payment of the following costs incurred by the Secretary: 

(A) Costs of securing trademark registrations. 

(B) Costs of operating the licensing program under 

this section. 

(2) For morale, welfare, and recreation activities under the 

jurisdiction of the Secretary, to the extent (if any) that the 

total amount of the licensing fees available under this section 

for a fiscal year exceed the total amount needed for such fiscal 

year under paragraph (1). 

(e) AVAILABILITY.—Fees received in a fiscal year and retained 

under this section shall be available for obligation in such fiscal 

year and the following two fiscal years. 

(f) DEFINITIONS.—In this section: 
1119 § 2262 CH. 134—MISC. ADMINISTRATIVE PROVISIONS 

(1) The terms ‘‘trademark’’, ‘‘service mark’’, ‘‘certification 

mark’’, and ‘‘collective mark’’ have the meanings given such 

terms in section 45 of the Act of July 5, 1946 (commonly referred to as the Trademark Act of 1946; 15 U.S.C. 1127). 

(2) The term ‘‘Secretary concerned’’ has the meaning provided in section 101(a)(9) of this title and also includes— 

(A) the Secretary of Defense, with respect to matters 

concerning the Defense Agencies and Department of Defense Field Activities; and 

(B) the Secretary of Homeland Security, with respect 

to matters concerning the Coast Guard when it is not operating as a service in the Department of the Navy. 

(Added Pub. L. 108–375, div. A, title X, Sec. 1004(a), Oct. 28, 2004, 118 Stat. 2035; amended 

Pub. L. 110–181, div. A, title VIII, Sec. 882(a), Jan. 28, 2008, 122 Stat. 263; Pub. L. 110–417, 

[div. A], title VIII, Sec. 881, Oct. 14, 2008, 122 Stat. 4559.) 

§ 2261. Presentation of recognition items for recruitment 

and retention purposes 

(a) EXPENDITURES FOR RECOGNITION ITEMS.—Under regulations prescribed by the Secretary of Defense, appropriated funds 

may be expended— 

(1) to procure recognition items of nominal or modest value 

for recruitment or retention purposes; and 

(2) to present such items— 

(A) to members of the armed forces; and 

(B) to members of the families of members of the 

armed forces, and other individuals, recognized as providing support that substantially facilitates service in the 

armed forces. 

(b) PROVISION OF MEALS AND REFRESHMENTS.—For purposes of 

section 520c of this title and any regulation prescribed to implement that section, functions conducted for the purpose of presenting recognition items described in subsection (a) shall be treated as recruiting functions, and recipients of such items shall be 

treated as persons who are the objects of recruiting efforts. 

(c) RECOGNITION ITEMS OF NOMINAL OR MODEST VALUE.—In 

this section, the term ‘‘recognition item of nominal or modest value’’ 

means a commemorative coin, medal, trophy, badge, flag, poster, 

painting, or other similar item that is valued at less than $50 per 

item and is designed to recognize or commemorate service in the 

armed forces. 

(Added Pub. L. 109–163, div. A, title V, Sec. 589(a)(1), Jan. 6, 2006, 119 Stat. 3279; amended 

Pub. L. 109–364, div. A, title V, Sec. 594, Oct. 17, 2006, 120 Stat. 2235.) 

§ 2262. Department of Defense conferences: collection of 

fees to cover Department of Defense costs 

(a) AUTHORITY TO COLLECT FEES.—(1) The Secretary of Defense may collect fees from any individual or commercial participant in a conference, seminar, exhibition, symposium, or similar 

meeting conducted by the Department of Defense (in this section 

referred to collectively as a ‘‘conference’’). 

(2) The Secretary may provide for the collection of fees under 

this section directly or by contract. The fees may be collected in advance of a conference. 
§ 2263 CH. 134—MISC. ADMINISTRATIVE PROVISIONS 1120 

(b) USES OF COLLECTED FEES.—Amounts collected under subsection (a) with respect to a conference shall be credited to the appropriation or account from which the costs of the conference are 

paid and shall be available to pay the costs of the Department of 

Defense with respect to the conference or to reimburse the Department for costs incurred with respect to the conference. 

(c) TREATMENT OF EXCESS AMOUNTS.—In the event the total 

amount of fees collected under subsection (a) with respect to a conference exceeds the actual costs of the Department of Defense with 

respect to the conference, the amount of such excess shall be deposited into the Treasury as miscellaneous receipts. 

(d) ANNUAL REPORTS.—(1) Not later than 45 days after the 

President submits to Congress the budget for a fiscal year under 

section 1105 of title 31, the Secretary of Defense shall submit to 

the congressional defense committees a budget justification document summarizing the use of the fee-collection authority provided 

by this section. 

(2) Each report shall include the following: 

(A) A list of all conferences conducted during the preceding 

two calendar years for which fees were collected under this section. 

(B) For each conference included on the list under subparagraph (A): 

(i) The estimated costs of the Department for the conference. 

(ii) The actual costs of the Department for the conference, including a separate statement of the amount of 

any conference coordinator fees associated with the conference. 

(iii) The amount of fees collected under this section for 

the conference. 

(C) An estimate of the number of conferences to be conducted during the calendar year in which the report is submitted for which the Department will collect fees under this 

section. 

(Added Pub. L. 109–364, div. A, title X, Sec. 1051(a), Oct. 17, 2006, 120 Stat. 2395.) 

§ 2263. United States contributions to the North Atlantic 

Treaty Organization common-funded budgets 

(a) IN GENERAL.—The total amount contributed by the Secretary of Defense in any fiscal year for the common-funded budgets 

of NATO may be an amount in excess of the maximum amount 

that would otherwise be applicable to those contributions in such 

fiscal year under the fiscal year 1998 baseline limitation. 

(b) REPORTS.—(1) Not later than October 30 each year, the Secretary of Defense shall submit to the congressional defense committees a report on the contributions made by the Secretary to the 

common-funded budgets of NATO in the preceding fiscal year. 

(2) Each report under paragraph (1) shall include, for the fiscal 

year covered by such report, the following: 

(A) The amounts contributed by the Secretary to each of 

the separate budgets and programs of the North Atlantic Treaty Organization under the common-funded budgets of NATO. 
1121 § 2263 CH. 134—MISC. ADMINISTRATIVE PROVISIONS 

(B) For each budget and program to which the Secretary 

made such a contribution, the percentage of such budget or 

program during the fiscal year that such contribution represented. 

(c) DEFINITIONS.—In this section: 

(1) COMMON-FUNDED BUDGETS OF NATO.—The term ‘‘common-funded budgets of NATO’’ means the Military Budget, the 

Security Investment Program, and the Civil Budget of the 

North Atlantic Treaty Organization (and any successor or additional account or program of NATO). 

(2) FISCAL YEAR 1998 BASELINE LIMITATION.—The term ‘‘fiscal year 1998 baseline limitation’’ means the maximum annual 

amount of Department of Defense contributions for commonfunded budgets of NATO that is set forth as the annual limitation in section 3(2)(C)(ii) of the resolution of the Senate giving 

the advice and consent of the Senate to the ratification of the 

Protocols to the North Atlantic Treaty of 1949 on the Accession 

of Poland, Hungary, and the Czech Republic (as defined in section 4(7) of that resolution), approved by the Senate on April 

30, 1998. 

(Added Pub. L. 110–417, [div. A], title X, Sec. 1004(a)(1), Oct. 14, 2008, 122 Stat. 4582.) 
1122 

CHAPTER 135—SPACE PROGRAMS 

Sec. 

2271. Management of space programs: joint program offices and officer management programs. 

2272. Space science and technology strategy: coordination. 

2273. Policy regarding assured access to space: national security payloads. 

2273a. Operationally Responsive Space Program Office. 

2274. Space situational awareness services and information: provision to nonUnited States Government entities. 

§ 2271. Management of space programs: joint program offices and officer management programs 

(a) JOINT PROGRAM OFFICES.—The Secretary of Defense shall 

take appropriate actions to ensure, to the maximum extent practicable, that space development and acquisition programs of the 

Department of Defense are carried out through joint program offices. 

(b) OFFICER MANAGEMENT PROGRAMS.—(1) The Secretary of 

Defense shall take appropriate actions to ensure, to the maximum 

extent practicable, that— 

(A) Army, Navy, and Marine Corps officers, as well as Air 

Force officers, are assigned to the space development and acquisition programs of the Department of Defense; and 

(B) Army, Navy, and Marine Corps officers, as well as Air 

Force officers, are eligible, on the basis of qualification, to hold 

leadership positions within the joint program offices referred to 

in subsection (a). 

(2) The Secretary of Defense shall designate those positions in 

the Office of the National Security Space Architect of the Department of Defense (or any successor office) that qualify as joint duty 

assignment positions for purposes of chapter 38 of this title. 

(Added Pub. L. 107–107, div. A, title IX, Sec. 911(a), Dec. 28, 2001, 115 Stat. 1195.) 

§ 2272. Space science and technology strategy: coordination 

(a) SPACE SCIENCE AND TECHNOLOGY STRATEGY.—(1) The Secretary of Defense and the Director of National Intelligence shall 

jointly develop and implement a space science and technology strategy and shall review and, as appropriate, revise the strategy annually. Functions of the Secretary under this subsection shall be carried out jointly by the Assistant Secretary of Defense for Research 

and Engineering and the official of the Department of Defense designated as the Department of Defense Executive Agent for Space. 

(2) The strategy under paragraph (1) shall, at a minimum, address the following issues: 

(A) Short-term and long-term goals of the space science 

and technology programs of the Department of Defense. 
1123 § 2272 CH. 135—SPACE PROGRAMS 

(B) The process for achieving the goals identified under 

subparagraph (A), including an implementation plan for 

achieving those goals. 

(C) The process for assessing progress made toward 

achieving those goals. 

(D) The process for transitioning space science and technology programs to new or existing space acquisition programs. 

(3) The strategy under paragraph (1) shall be included as part 

of the annual National Security Space Plan developed pursuant to 

Department of Defense regulations and shall be provided to Department of Defense components and science and technology entities of the Department of Defense to support the planning, programming, and budgeting processes of the Department. 

(4) The strategy under paragraph (1) shall be developed in consultation with the directors of research laboratories of the Department of Defense, the directors of the other Department of Defense 

research components, and the heads of other organizations of the 

Department of Defense as identified by the Assistant Secretary of 

Defense for Research and Engineering and the Department of Defense Executive Agent for Space. 

(5) The Secretary of Defense and the Director of National Intelligence shall biennially submit the strategy developed under paragraph (1) to the congressional defense committees every other year 

on the date on which the President submits to Congress the budget 

for the next fiscal year under section 1105 of title 31. 

(b) REQUIRED COORDINATION.—In carrying out the space 

science and technology strategy developed under subsection (a), the 

directors of the research laboratories of the Department of Defense, 

the directors of the other Department of Defense research components, and the heads of all other appropriate organizations identified jointly by the Assistant Secretary of Defense for Research and 

Engineering and the Department of Defense Executive Agent for 

Space shall each— 

(1) identify research projects in support of that strategy 

that contribute directly and uniquely to the development of 

space technology; and 

(2) inform the Assistant Secretary of Defense for Research 

and Engineering and the Department of Defense Executive 

Agent for Space of the planned budget and planned schedule 

for executing those projects. 

(c) DEFINITIONS.—In this section: 

(1) The term ‘‘research laboratory of the Department of Defense’’ means any of the following: 

(A) The Air Force Research Laboratory. 

(B) The Naval Research Laboratory. 

(C) The Office of Naval Research. 

(D) The Army Research Laboratory. 

(2) The term ‘‘other Department of Defense research component’’ means either of the following: 

(A) The Defense Advanced Research Projects Agency. 

(B) The National Reconnaissance Office. 

(Added Pub. L. 108–136, div. A, title IX, Sec. 911(a)(1), Nov. 24, 2003, 117 Stat. 1563; amended 

Pub. L. 111–84, div. A, title IX, Sec. 911(a)(1)–(3), Oct. 28, 2009, 123 Stat. 2428, 2429; Pub. L. 

111–383, div. A, title IX, Sec. 901(j)(2), Jan. 7, 2011, 124 Stat. 4324.) 
§ 2273 CH. 135—SPACE PROGRAMS 1124 

§ 2273. Policy regarding assured access to space: national 

security payloads 

(a) POLICY.—It is the policy of the United States for the President to undertake actions appropriate to ensure, to the maximum 

extent practicable, that the United States has the capabilities necessary to launch and insert United States national security payloads into space whenever such payloads are needed in space. 

(b) INCLUDED ACTIONS.—The appropriate actions referred to in 

subsection (a) shall include, at a minimum, providing resources and 

policy guidance to sustain— 

(1) the availability of at least two space launch vehicles (or 

families of space launch vehicles) capable of delivering into 

space any payload designated by the Secretary of Defense or 

the Director of National Intelligence as a national security payload; and 

(2) a robust space launch infrastructure and industrial 

base. 

(c) COORDINATION.—The Secretary of Defense shall, to the 

maximum extent practicable, pursue the attainment of the capabilities described in subsection (a) in coordination with the Administrator of the National Aeronautics and Space Administration. 

(Added Pub. L. 108–136, div. A, title IX, Sec. 912(a)(1), Nov. 24, 2003, 117 Stat. 1565; amended 

Pub. L. 110–181, div. A, title IX, Sec. 931(a)(12), Jan. 28, 2008, 122 Stat. 285; Pub. L. 110– 

417, [div. A], title IX, Sec. 932(a)(11), Oct. 14, 2008, 122 Stat. 4576; Pub. L. 111–84, div. A, title 

X, Sec. 1073(c)(10), Oct. 28, 2009, 123 Stat. 2475.) 

§ 2273a. Operationally Responsive Space Program Office 

(a) ESTABLISHMENT.—The Secretary of Defense shall establish 

within the Department of Defense an office to be known as the 

Operationally Responsive Space Program Office (in this section referred to as the ‘‘Office’’). 

(b) HEAD OF OFFICE.—The head of the Office shall be— 

(1) the Department of Defense Executive Agent for Space; 

or 

(2) the designee of the Secretary of Defense, who shall report to the Department of Defense Executive Agent for Space. 

(c) MISSION.—The mission of the Office shall be— 

(1) to contribute to the development of low-cost, rapid reaction payloads, busses, spacelift, and launch control capabilities 

in order to fulfill joint military operational requirements for 

on-demand space support and reconstitution; and 

(2) to coordinate and execute operationally responsive 

space efforts across the Department of Defense with respect to 

planning, acquisition, and operations. 

(d) ELEMENTS.—The Secretary of Defense shall select the elements of the Department of Defense to be included in the Office so 

as to contribute to the development of capabilities for operationally 

responsive space and to achieve a balanced representation of the 

military departments in the Office to ensure proper acknowledgment of joint considerations in the activities of the Office, except 

that the Office shall include the following: 

(1) A science and technology element that shall pursue innovative approaches to the development of capabilities for 

operationally responsive space through basic and applied re-
1125 § 2273a CH. 135—SPACE PROGRAMS 

search focused on (but not limited to) payloads, bus, and 

launch equipment. 

(2) An acquisition element that shall undertake the acquisition of systems necessary to integrate, sustain, and launch 

assets for operationally responsive space. 

(3) An operations element that shall— 

(A) sustain and maintain assets for operationally responsive space prior to launch; 

(B) integrate and launch such assets; and 

(C) operate such assets in orbit. 

(4) A combatant command support element that shall 

serve as the primary intermediary between the military departments and the combatant commands in order to— 

(A) ascertain the needs of the commanders of the combatant commands; and 

(B) integrate operationally responsive space capabilities into— 

(i) operations plans of the combatant commands; 

(ii) techniques, tactics, and procedures of the military departments; and 

(iii) military exercises, demonstrations, and war 

games. 

(5) Such other elements as the Secretary of Defense may 

consider necessary. 

(e) ACQUISITION AUTHORITY.—The acquisition activities of the 

Office shall be subject to the following: 

(1) The Department of Defense Executive Agent for Space 

shall be the senior acquisition executive of the Office. 

(2) The Joint Capabilities Integration and Development 

System process shall not apply to acquisitions by the Office for 

operational experimentation. 

(3) The commander of the United States Strategic Command, or the designee of the commander, shall— 

(A) validate all system requirements for systems to be 

acquired by the Office; and 

(B) participate in the approval of any acquisition program initiated by the Office. 

(4) To the maximum extent practicable, the procurement 

unit cost of a launch vehicle procured by the Office for launch 

to low earth orbit should not exceed $20,000,000 (in constant 

dollars). 

(5) To the maximum extent practicable, the procurement 

unit cost of an integrated satellite procured by the Office 

should not exceed $40,000,000 (in constant dollars). 

(f) REQUIRED PROGRAM ELEMENT.—(1) The Secretary of Defense shall ensure that, within budget program elements for space 

programs of the Department of Defense, that— 

(A) there is a separate, dedicated program element for 

operationally responsive space; 

(B) to the extent applicable, relevant program elements 

should be consolidated into the program element required by 

subparagraph (A); and 

(C) the Office executes its responsibilities through this program element. 
§ 2274 CH. 135—SPACE PROGRAMS 1126 

(2) The Office shall manage the program element required by 

paragraph (1)(A). 

(Added Pub. L. 108–375, div. A, title IX, Sec. 913(a)(1), Oct. 28, 2004, 118 Stat. 2028; amended 

Pub. L. 109–364, div. A, title IX, Sec. 913(b)(1), Oct. 17, 2006, 120 Stat. 2355.) 

§ 2274. Space situational awareness services and information: provision to non-United States Government 

entities 

(a) AUTHORITY.—The Secretary of Defense may provide space 

situational awareness services and information to, and may obtain 

space situational awareness data and information from, non-United 

States Government entities in accordance with this section. Any 

such action may be taken only if the Secretary determines that 

such action is consistent with the national security interests of the 

United States. 

(b) ELIGIBLE ENTITIES.—The Secretary may provide services 

and information under subsection (a) to, and may obtain data and 

information under subsection (a) from, any non-United States Government entity, including any of the following: 

(1) A State. 

(2) A political subdivision of a State. 

(3) A United States commercial entity. 

(4) The government of a foreign country. 

(5) A foreign commercial entity. 

(c) AGREEMENT.—The Secretary may not provide space situational awareness services and information under subsection (a) to 

a non-United States Government entity unless that entity enters 

into an agreement with the Secretary under which the entity— 

(1) agrees to pay an amount that may be charged by the 

Secretary under subsection (d); 

(2) agrees not to transfer any data or technical information 

received under the agreement, including the analysis of data, 

to any other entity without the express approval of the Secretary; and 

(3) agrees to any other terms and conditions considered 

necessary by the Secretary. 

(d) CHARGES.—(1) As a condition of an agreement under subsection (c), the Secretary may (except as provided in paragraph (2)) 

require the non-United States Government entity entering into the 

agreement to pay to the Department of Defense such amounts as 

the Secretary determines appropriate to reimburse the Department 

for the costs to the Department of providing space situational 

awareness services or information under the agreement. 

(2) The Secretary may not require the government of a State, 

or of a political subdivision of a State, to pay any amount under 

paragraph (1). 

(e) CREDITING OF FUNDS RECEIVED.—(1) Funds received for the 

provision of space situational awareness services or information 

pursuant to an agreement under this section shall be credited, at 

the election of the Secretary, to the following: 

(A) The appropriation, fund, or account used in incurring 

the obligation. 
1127 § 2274 CH. 135—SPACE PROGRAMS 

(B) An appropriate appropriation, fund, or account currently available for the purposes for which the expenditures 

were made. 

(2) Funds credited under paragraph (1) shall be merged with, 

and remain available for obligation with, the funds in the appropriation, fund, or account to which credited. 

(f) PROCEDURES.—The Secretary shall establish procedures by 

which the authority under this section shall be carried out. As part 

of those procedures, the Secretary may allow space situational 

awareness services or information to be provided through a contractor of the Department of Defense. 

(g) IMMUNITY.—The United States, any agencies and instrumentalities thereof, and any individuals, firms, corporations, and 

other persons acting for the United States, shall be immune from 

any suit in any court for any cause of action arising from the provision or receipt of space situational awareness services or information, whether or not provided in accordance with this section, or 

any related action or omission. 

(h) NOTICE OF CONCERNS OF DISCLOSURE OF INFORMATION.—If 

the Secretary determines that a commercial or foreign entity has 

declined or is reluctant to provide data or information to the Secretary in accordance with this section due to the concerns of such 

entity about the potential disclosure of such data or information, 

the Secretary shall, not later than 60 days after the Secretary 

makes that determination, provide notice to the congressional defense committees of the declination or reluctance of such entity. 

(Added Pub. L. 108–136, div. A, title IX, Sec. 913(a), Nov. 24, 2003, 117 Stat. 1565; amended 

Pub. L. 109–364, div. A, title IX, Sec. 912, Oct. 17, 2006, 120 Stat. 2355; Pub. L. 110–417, [div. 

A], title IX, Sec. 911, Oct. 14, 2008, 122 Stat. 4571; Pub. L. 111–84, div. A, title IX, Sec. 912(a), 

Oct. 28, 2009, 123 Stat. 2429.) 
1128 

CHAPTER 136—PROVISIONS RELATING TO SPECIFIC 

PROGRAMS 

Sec. 

2281. Global Positioning System. 

2282. B–2 bomber: annual report. 

§ 2281. Global Positioning System 

(a) SUSTAINMENT AND OPERATION FOR MILITARY PURPOSES.— 

The Secretary of Defense shall provide for the sustainment of the 

capabilities of the Global Positioning System (hereinafter in this 

section referred to as the ‘‘GPS’’), and the operation of basic GPS 

services, that are beneficial for the national security interests of 

the United States. In doing so, the Secretary shall— 

(1) develop appropriate measures for preventing hostile 

use of the GPS so as to make it unnecessary for the Secretary 

to use the selective availability feature of the system continuously while not hindering the use of the GPS by the United 

States and its allies for military purposes; and 

(2) ensure that United States armed forces have the capability to use the GPS effectively despite hostile attempts to prevent the use of the system by such forces. 

(b) SUSTAINMENT AND OPERATION FOR CIVILIAN PURPOSES.— 

The Secretary of Defense shall provide for the sustainment and operation of the GPS Standard Positioning Service for peaceful civil, 

commercial, and scientific uses on a continuous worldwide basis 

free of direct user fees. In doing so, the Secretary— 

(1) shall provide for the sustainment and operation of the 

GPS Standard Positioning Service in order to meet the performance requirements of the Federal Radionavigation Plan 

prepared jointly by the Secretary of Defense and the Secretary 

of Transportation pursuant to subsection (c); 

(2) shall coordinate with the Secretary of Transportation 

regarding the development and implementation by the Government of augmentations to the basic GPS that achieve or enhance uses of the system in support of transportation; 

(3) shall coordinate with the Secretary of Commerce, the 

United States Trade Representative, and other appropriate officials to facilitate the development of new and expanded civil 

and commercial uses for the GPS; 

(4) shall develop measures for preventing hostile use of the 

GPS in a particular area without hindering peaceful civil use 

of the system elsewhere; and 

(5) may not agree to any restriction on the Global Positioning System proposed by the head of a department or agency of the United States outside the Department of Defense in 

the exercise of that official’s regulatory authority that would 
1129 § 2281 CH. 136—PROVISIONS RELATING TO SPECIFIC PROGRAMS 

adversely affect the military potential of the Global Positioning 

System. 

(c) FEDERAL RADIONAVIGATION PLAN.—The Secretary of Defense and the Secretary of Transportation shall jointly prepare the 

Federal Radionavigation Plan. The plan shall be revised and updated not less often than every two years. The plan shall be prepared in accordance with the requirements applicable to such plan 

as first prepared pursuant to section 507 of the International Maritime Satellite Telecommunications Act (47 U.S.C. 756). The plan, 

and any amendment to the plan, shall be published in the Federal 

Register. 

(d) BIENNIAL REPORT.—(1) Not later than 30 days after the end 

of each even-numbered fiscal year, the Deputy Secretary of Defense 

and the Deputy Secretary of Transportation, in their capacity as cochairs of the National Executive Committee for Space-Based Positioning, Navigation, and Timing, shall submit to the Committees 

on Armed Services and Commerce, Science, and Transportation of 

the Senate and the Committees on Armed Services, Energy and 

Commerce, and Transportation and Infrastructure of the House of 

Representatives a report on the Global Positioning System. The report shall include a discussion of the following matters: 

(A) The operational status of the system. 

(B) The capability of the system to satisfy effectively (i) the 

military requirements for the system that are current as of the 

date of the report, and (ii) the validated performance requirements of the Federal Radionavigation Plan in accordance with 

Office of Management and Budget Circular A–109. 

(C) The status of cooperative activities undertaken by the 

United States with the governments of other countries concerning the capability of the system or any augmentation of 

the system to satisfy civil, commercial, scientific, and military 

requirements, including a discussion of the status and results 

of activities undertaken under any regional international 

agreement. 

(D) Progress and challenges in establishing GPS as an 

international standard for consistency of navigational service. 

(E) Progress and challenges in protecting GPS from jamming, disruption, and interference. 

(F) Progress and challenges in developing the enhanced 

Global Positioning System required by section 218(b) of the 

Strom Thurmond National Defense Authorization Act for Fiscal Year 1999 (Public Law 105–261; 112 Stat. 1951; 10 U.S.C. 

2281 note). 

(G) The effects of use of the system on national security, 

regional security, and the economic competitiveness of United 

States industry, including the Global Positioning System 

equipment and service industry and user industries. 

(2) In preparing each report required under paragraph (1), the 

Deputy Secretary of Defense and the Deputy Secretary of Transportation, in their capacity as co-chairs of the National Executive 

Committee for Space-Based Positioning, Navigation, and Timing, 

shall consult with the Secretary of Defense, the Secretary of State, 

the Secretary of Transportation, and the Secretary of Homeland 

Security. 
§ 2282 CH. 136—PROVISIONS RELATING TO SPECIFIC PROGRAMS 1130 

(e) DEFINITIONS.—In this section: 

(1) The term ‘‘basic GPS services’’ means the following 

components of the Global Positioning System that are operated 

and maintained by the Department of Defense: 

(A) The constellation of satellites. 

(B) The navigation payloads that produce the Global 

Positioning System signals. 

(C) The ground stations, data links, and associated 

command and control facilities. 

(2) The term ‘‘GPS Standard Positioning Service’’ means 

the civil and commercial service provided by the basic Global 

Positioning System as defined in the 1996 Federal Radionavigation Plan (published jointly by the Secretary of Defense 

and the Secretary of Transportation in July 1997). 

(Added Pub. L. 105–85, div. A, title X, Sec. 1074(c), Nov. 18, 1997, 111 Stat. 1908; amended 

Pub. L. 106–65, div. A, title X, Sec. 1067(1), Oct. 5, 1999, 113 Stat. 774; Pub. L. 108–136, div. 

A, title IX, Sec. 914, Nov. 24, 2003, 117 Stat. 1567; Pub. L. 111–84, div. A, title X, Sec. 1032, 

Oct. 28, 2009, 123 Stat. 2448.) 

§ 2282. B–2 bomber: annual report 

Not later than March 1 of each year through 2008, the Secretary of Defense shall submit to the Committee on Armed Services 

of the Senate and the Committee on Armed Services of the House 

of Representatives a report on the B–2 bomber aircraft. Each such 

report shall include the following: 

(1) Identification of the average full-mission capable rate of 

B–2 aircraft for the preceding fiscal year and the Secretary’s 

overall assessment of the implications of that full-mission capable rate on mission accomplishment for the B–2 aircraft, together with the Secretary’s determination as to whether that 

rate is adequate for the accomplishment of each of the missions 

assigned to the B–2 aircraft as of the date of the assessment. 

(2) An assessment of the technical capabilities of the B–2 

aircraft and whether these capabilities are adequate to accomplish each of the missions assigned to that aircraft as of the 

date of the assessment. 

(3) Identification of all ongoing and planned development 

of technologies to enhance the capabilities of that aircraft. 

(4) Identification and assessment of additional technologies 

that would make that aircraft more capable or survivable 

against known and evolving threats. 

(5) A fiscally phased program for each technology identified in paragraphs (3) and (4) for the budget year and the future-years defense program, based on the following three funding situations: 

(A) The President’s current budget. 

(B) The President’s current budget and the current 

Department of Defense unfunded priority list. 

(C) The maximum executable funding for the B–2 aircraft given the requirement to maintain enough operationally ready aircraft to accomplish missions assigned to the 

B–2 aircraft. 

(Added Pub. L. 106–398, Sec. 1 [[div. A], title I, Sec. 131(a)(1)], Oct. 30, 2000, 114 Stat. 1654, 

1654A–28; amended Pub. L. 108–136, div. A, title X, Sec. 1031(a)(14), Nov. 24, 2003, 117 Stat. 

1597.) 
1131 

CHAPTER 137—PROCUREMENT GENERALLY 

Sec. 

[2301. Repealed.] 

2302. Definitions. 

2302a. Simplified acquisition threshold. 

2302b. Implementation of simplified acquisition procedures. 

2302c. Implementation of electronic commerce capability. 

2302d. Major system: definitional threshold amounts. 

2303. Applicability of chapter. 

[2303a. Repealed.] 

2304. Contracts: competition requirements. 

2304a. Task and delivery order contracts: general authority. 

2304b. Task order contracts: advisory and assistance services. 

2304c. Task and delivery order contracts: orders. 

2304d. Task and delivery order contracts: definitions. 

2304e. Contracts: prohibition on competition between Department of Defense and 

small businesses and certain other entities. 

2305. Contracts: planning, solicitation, evaluation, and award procedures. 

2305a. Design-build selection procedures. 

2306. Kinds of contracts. 

2306a. Cost or pricing data: truth in negotiations. 

2306b. Multiyear contracts: acquisition of property. 

2306c. Multiyear contracts: acquisition of services. 

2307. Contract financing. 

2308. Buy-to-budget acquisition: end items. 

2309. Allocation of appropriations. 

2310. Determinations and decisions. 

2311. Assignment and delegation of procurement functions and responsibilities. 

2312. Remission of liquidated damages. 

2313. Examination of records of contractor. 

2314. Laws inapplicable to agencies named in section 2303 of this title. 

2315. Law inapplicable to the procurement of automatic data processing equipment and services for certain defense purposes. 

2316. Disclosure of identity of contractor. 

[2317. Repealed.] 

2318. Advocates for competition. 

2319. Encouragement of new competitors. 

2320. Rights in technical data. 

2321. Validation of proprietary data restrictions. 

[2322. Repealed.] 

2323. Contract goal for small disadvantaged businesses and certain institutions 

of higher education. 

2323a. Credit for Indian contracting in meeting certain subcontracting goals for 

small disadvantaged businesses and certain institutions of higher education. 

2324. Allowable costs under defense contracts. 

2325. Restructuring costs. 

2326. Undefinitized contractual actions: restrictions. 

2327. Contracts: consideration of national security objectives. 

2328. Release of technical data under Freedom of Information Act: recovery of 

costs. 

[2329. Repealed.] 

2330. Procurement of contract services: management structure. 

2330a. Procurement of services: tracking of purchases. 

2331. Procurement of services: contracts for professional and technical services. 

2332. Share-in-savings contracts. 
[§ 2301 CH. 137—PROCUREMENT GENERALLY 1132 

2333. Joint policies on requirements definition, contingency program management, and contingency contracting. 

2334. Independent cost estimation and cost analysis. 

[§ 2301. Repealed. Pub. L. 103–355, title I, Sec. 1501(a), Oct. 

13, 1994, 108 Stat. 3296] 

§ 2302. Definitions 

In this chapter: 

(1) The term ‘‘head of an agency’’ means the Secretary of 

Defense, the Secretary of the Army, the Secretary of the Navy, 

the Secretary of the Air Force, the Secretary of Homeland Security, and the Administrator of the National Aeronautics and 

Space Administration. 

(2) The term ‘‘competitive procedures’’ means procedures 

under which the head of an agency enters into a contract pursuant to full and open competition. Such term also includes— 

(A) procurement of architectural or engineering services conducted in accordance with chapter 11 of title 40; 

(B) the competitive selection for award of basic research proposals resulting from a general solicitation and 

the peer review or scientific review (as appropriate) of such 

proposals; 

(C) the procedures established by the Administrator of 

General Services for the multiple award schedule program 

of the General Services Administration if— 

(i) participation in the program has been open to 

all responsible sources; and 

(ii) orders and contracts under such program result in the lowest overall cost alternative to meet the 

needs of the United States; 

(D) procurements conducted in furtherance of section 

15 of the Small Business Act (15 U.S.C. 644) as long as all 

responsible business concerns that are entitled to submit 

offers for such procurements are permitted to compete; and 

(E) a competitive selection of research proposals resulting from a general solicitation and peer review or scientific review (as appropriate) solicited pursuant to section 

9 of the Small Business Act (15 U.S.C. 638). 

(3) The following terms have the meanings provided such 

terms in chapter 1 of title 41: 

(A) The term ‘‘procurement’’. 

(B) The term ‘‘procurement system’’. 

(C) The term ‘‘standards’’. 

(D) The term ‘‘full and open competition’’. 

(E) The term ‘‘responsible source’’. 

(F) The term ‘‘item’’. 

(G) The term ‘‘item of supply’’. 

(H) The term ‘‘supplies’’. 

(I) The term ‘‘commercial item’’. 

(J) The term ‘‘nondevelopmental item’’. 

(K) The term ‘‘commercial component’’. 

(L) The term ‘‘component’’. 

(4) The term ‘‘technical data’’ means recorded information 

(regardless of the form or method of the recording) of a sci-
1133 § 2302 CH. 137—PROCUREMENT GENERALLY 

1 At the end of paragraph (7), the reference to ‘‘section 4 of such Act’’ probably should be a 

reference to section 134 of title 41. 2 In paragraph (9)(A), the reference to ‘‘section 26 of the Office of Federal Procurement Policy 

Act (41 U.S.C. 422)’’ should be to chapter 15 of title 41. 

entific or technical nature (including computer software documentation) relating to supplies procured by an agency. Such 

term does not include computer software or financial, administrative, cost or pricing, or management data or other information incidental to contract administration. 

(5) The term ‘‘major system’’ means a combination of elements that will function together to produce the capabilities required to fulfill a mission need. The elements may include 

hardware, equipment, software or any combination thereof, but 

excludes construction or other improvements to real property. 

A system shall be considered a major system if (A) the conditions of section 2302d of this title are satisfied, or (B) the system is designated a ‘‘major system’’ by the head of the agency 

responsible for the system. 

(6) The term ‘‘Federal Acquisition Regulation’’ means the 

Federal Acquisition Regulation issued pursuant to section 

1303(a)(1) of title 41. 

(7) The term ‘‘simplified acquisition threshold’’ has the 

meaning provided that term in section 134 of title 41, except 

that, in the case of any contract to be awarded and performed, 

or purchase to be made, outside the United States in support 

of a contingency operation or a humanitarian or peacekeeping 

operation, the term means an amount equal to two times the 

amount specified for that term in section 4 of such Act 1. (8) The term ‘‘humanitarian or peacekeeping operation’’ 

means a military operation in support of the provision of humanitarian or foreign disaster assistance or in support of a 

peacekeeping operation under chapter VI or VII of the Charter 

of the United Nations. The term does not include routine training, force rotation, or stationing. 

(9) The term ‘‘nontraditional defense contractor’’, with respect to a procurement or with respect to a transaction authorized under section 2371(a) of this title, means an entity that 

is not currently performing and has not performed, for at least 

the one-year period preceding the solicitation of sources by the 

Department of Defense for the procurement or transaction, any 

of the following for the Department of Defense: 

(A) Any contract or subcontract that is subject to full 

coverage under the cost accounting standards prescribed 

pursuant to section 26 of the Office of Federal Procurement Policy Act 2 (41 U.S.C. 422) and the regulations implementing such section. (B) Any other contract in excess of $500,000 under 

which the contractor is required to submit certified cost or 

pricing data under section 2306a of this title. 

(Aug. 10, 1956, ch. 1041, 70A Stat. 127; Pub. L. 85–568, title III, Sec. 301(b), July 29, 1958, 

72 Stat. 432; Pub. L. 85–861, Sec. 1(43A), Sept. 2, 1958, 72 Stat. 1457; Pub. L. 96–513, title 

V, Sec. 511(74), Dec. 12, 1980, 94 Stat. 2926; Pub. L. 98–369, div. B, title VII, Sec. 2722(a), July 

18, 1984, 98 Stat. 1186; Pub. L. 98–525, title XII, Sec. 1211, Oct. 19, 1984, 98 Stat. 2589; Pub. 

L. 98–577, title V, Sec. 504(b)(3), Oct. 30, 1984, 98 Stat. 3087; Pub. L. 99–661, div. A, title XIII, 

Sec. 1343(a)(13), Nov. 14, 1986, 100 Stat. 3993; Pub. L. 100–26, Sec. 7(k)(2), Apr. 21, 1987, 101 

Stat. 284; Pub. L. 101–189, div. A, title VIII, Sec. 853(b)(1), Nov. 29, 1989, 103 Stat. 1518; Pub. 
§ 2302a CH. 137—PROCUREMENT GENERALLY 1134 

L. 102–25, title VII, Sec. 701(d)(1), Apr. 6, 1991, 105 Stat. 113; Pub. L. 102–190, div. A, title 

VIII, Sec. 805, Dec. 5, 1991, 105 Stat. 1417; Pub. L. 103–355, title I, Sec. 1502, Oct. 13, 1994, 

108 Stat. 3296; Pub. L. 104–106, div. D, title XLIII, Sec. 4321(b)(3), Feb. 10, 1996, 110 Stat. 

672; Pub. L. 104–201, div. A, title VIII, Sec. 805(a)(1), 807(a), Sept. 23, 1996, 110 Stat. 2605, 

2606; Pub. L. 105–85, div. A, title VIII, Sec. 803(b), Nov. 18, 1997, 111 Stat. 1832; Pub. L. 107– 

217, Sec. 3(b)(2), Aug. 21, 2002, 116 Stat. 1295; Pub. L. 107–296, title XVII, Sec. 1704(b)(1), Nov. 

25, 2002, 116 Stat. 2314; Pub. L. 111–350, Sec. 5(b)(8), Jan. 4, 2011, 124 Stat. 3842; Pub. L. 

111–383, div. A, title VIII, Sec. 866(g)(1), Jan. 7, 2011, 124 Stat. 4298.) 

§ 2302a. Simplified acquisition threshold 

(a) SIMPLIFIED ACQUISITION THRESHOLD.—For purposes of acquisitions by agencies named in section 2303 of this title, the simplified acquisition threshold is as specified in section 134 of title 41. 

(b) INAPPLICABLE LAWS.—No law properly listed in the Federal 

Acquisition Regulation pursuant to section 1905 of title 41 shall 

apply to or with respect to a contract or subcontract that is not 

greater than the simplified acquisition threshold. 

(Added and amended Pub. L. 103–355, title IV, Sec. 4002(a), 4102(a), Oct. 13, 1994, 108 Stat. 

3338, 3340; Pub. L. 111–350, Sec. 5(b)(9), Jan. 4, 2011, 124 Stat. 3843.) 

§ 2302b. Implementation of simplified acquisition procedures 

The simplified acquisition procedures contained in the Federal 

Acquisition Regulation pursuant to section 1901 of title 41 shall 

apply as provided in such section to the agencies named in section 

2303(a) of this title. 

(Added Pub. L. 103–355, title IV, Sec. 4203(a)(1), Oct. 13, 1994, 108 Stat. 3345; amended Pub. 

L. 111–350, Sec. 5(b)(10), Jan. 4, 2011, 124 Stat. 3843.) 

§ 2302c. Implementation of electronic commerce capability 

(a) IMPLEMENTATION OF ELECTRONIC COMMERCE CAPABILITY.— 

(1) The head of each agency named in paragraphs (1), (5), and (6) 

of section 2303(a) of this title shall implement the electronic commerce capability required by section 2301 of title 41. 

(2) The Secretary of Defense shall act through the Under Secretary of Defense for Acquisition, Technology, and Logistics to implement the capability within the Department of Defense. 

(3) In implementing the electronic commerce capability pursuant to paragraph (1), the head of an agency referred to in paragraph (1) shall consult with the Administrator for Federal Procurement Policy. 

(b) DESIGNATION OF AGENCY OFFICIAL.—The head of each 

agency named in paragraph (5) or (6) of section 2303(a) of this title 

shall designate a program manager to implement the electronic 

commerce capability for that agency. The program manager shall 

report directly to an official at a level not lower than the senior 

procurement executive designated for the agency under section 

1702(c) of title 41. 

(Added Pub. L. 103–355, title IX, Sec. 9002(a), Oct. 13, 1994, 108 Stat. 3402; amended Pub. L. 

105–85, div. A, title VIII, Sec. 850(f)(3)(A), Nov. 18, 1997, 111 Stat. 1850; Pub. L. 105–129, Sec. 

1(a)(1), Dec. 1, 1997, 111 Stat. 2551; Pub. L. 106–65, div. A, title X, Sec. 1066(a)(18), Oct. 5, 

1999, 113 Stat. 771; Pub. L. 107–107, div. A, title X, Sec. 1048(b)(2), Dec. 28, 2001, 115 Stat. 

1225; Pub. L. 109–364, div. A, title X, Sec. 1071(a)(2), Oct. 17, 2006, 120 Stat. 2398; Pub. L. 

111–350, Sec. 5(b)(11), Jan. 4, 2011, 124 Stat. 3843.) 
1135 § 2303 CH. 137—PROCUREMENT GENERALLY 

§ 2302d. Major system: definitional threshold amounts 

(a) DEPARTMENT OF DEFENSE SYSTEMS.—For purposes of section 2302(5) of this title, a system for which the Department of Defense is responsible shall be considered a major system if— 

(1) the total expenditures for research, development, test, 

and evaluation for the system are estimated to be more than 

$115,000,000 (based on fiscal year 1990 constant dollars); or 

(2) the eventual total expenditure for procurement for the 

system is estimated to be more than $540,000,000 (based on 

fiscal year 1990 constant dollars). 

(b) CIVILIAN AGENCY SYSTEMS.—For purposes of section 

2302(5) of this title, a system for which a civilian agency is responsible shall be considered a major system if total expenditures for 

the system are estimated to exceed the greater of— 

(1) $750,000 (based on fiscal year 1980 constant dollars); 

or 

(2) the dollar threshold for a ‘‘major system’’ established by 

the agency pursuant to Office of Management and Budget 

(OMB) Circular A–109, entitled ‘‘Major Systems Acquisitions’’. 

(c) ADJUSTMENT AUTHORITY.—(1) The Secretary of Defense 

may adjust the amounts and the base fiscal year provided in subsection (a) on the basis of Department of Defense escalation rates. 

(2) An amount, as adjusted under paragraph (1), that is not 

evenly divisible by $5,000,000 shall be rounded to the nearest multiple of $5,000,000. In the case of an amount that is evenly divisible by $2,500,000 but not evenly divisible by $5,000,000, the 

amount shall be rounded to the next higher multiple of $5,000,000. 

(3) An adjustment under this subsection shall be effective after 

the Secretary transmits to the Committee on Armed Services of the 

Senate and the Committee on Armed Services of the House of Representatives a written notification of the adjustment. 

(Added Pub. L. 104–201, div. A, title VIII, Sec. 805(a)(2), Sept. 23, 1996, 110 Stat. 2605; amended Pub. L. 105–85, div. A, title X, Sec. 1073(a)(41), Nov. 18, 1997, 111 Stat. 1902; Pub. L. 106– 

65, div. A, title X, Sec. 1067(1), Oct. 5, 1999, 113 Stat. 774.) 

§ 2303. Applicability of chapter 

(a) This chapter applies to the procurement by any of the following agencies, for its use or otherwise, of all property (other than 

land) and all services for which payment is to be made from appropriated funds: 

(1) The Department of Defense. 

(2) The Department of the Army. 

(3) The Department of the Navy. 

(4) The Department of the Air Force. 

(5) The Coast Guard. 

(6) The National Aeronautics and Space Administration. 

(b) The provisions of this chapter that apply to the procurement of property apply also to contracts for its installation or alteration. 

(Aug. 10, 1956, ch. 1041, 70A Stat. 128; Pub. L. 85–568, title III, Sec. 301(b), July 29, 1958, 

72 Stat. 432; Pub. L. 98–369, div. B, title VII, Sec. 2722(b), July 18, 1984, 98 Stat. 1187.) 
[§ 2303a CH. 137—PROCUREMENT GENERALLY 1136 

[§ 2303a. Repealed. Pub. L. 98–577, title III, Sec. 302(c)(1), 

Oct. 30, 1984, 98 Stat. 3077] 

§ 2304. Contracts: competition requirements 

(a)(1) Except as provided in subsections (b), (c), and (g) and except in the case of procurement procedures otherwise expressly authorized by statute, the head of an agency in conducting a procurement for property or services— 

(A) shall obtain full and open competition through the use 

of competitive procedures in accordance with the requirements 

of this chapter and the Federal Acquisition Regulation; and 

(B) shall use the competitive procedure or combination of 

competitive procedures that is best suited under the circumstances of the procurement. 

(2) In determining the competitive procedure appropriate 

under the circumstances, the head of an agency— 

(A) shall solicit sealed bids if— 

(i) time permits the solicitation, submission, and evaluation of sealed bids; 

(ii) the award will be made on the basis of price and 

other price-related factors; 

(iii) it is not necessary to conduct discussions with the 

responding sources about their bids; and 

(iv) there is a reasonable expectation of receiving more 

than one sealed bid; and 

(B) shall request competitive proposals if sealed bids are 

not appropriate under clause (A). 

(b)(1) The head of an agency may provide for the procurement 

of property or services covered by this chapter using competitive 

procedures but excluding a particular source in order to establish 

or maintain an alternative source or sources of supply for that 

property or service if the head of the agency determines that to do 

so— 

(A) would increase or maintain competition and would 

likely result in reduced overall costs for such procurement, or 

for any anticipated procurement, of property or services; 

(B) would be in the interest of national defense in having 

a facility (or a producer, manufacturer, or other supplier) available for furnishing the property or service in case of a national 

emergency or industrial mobilization; 

(C) would be in the interest of national defense in establishing or maintaining an essential engineering, research, or 

development capability to be provided by an educational or 

other nonprofit institution or a federally funded research and 

development center; 

(D) would ensure the continuous availability of a reliable 

source of supply of such property or service; 

(E) would satisfy projected needs for such property or service determined on the basis of a history of high demand for the 

property or service; or 

(F) in the case of medical supplies, safety supplies, or 

emergency supplies, would satisfy a critical need for such supplies. 
1137 § 2304 CH. 137—PROCUREMENT GENERALLY 

(2) The head of an agency may provide for the procurement of 

property or services covered by this section using competitive procedures, but excluding concerns other than small business concerns 

in furtherance of sections 9 and 15 of the Small Business Act (15 

U.S.C. 638, 644) and concerns other than small business concerns, 

historically Black colleges and universities, and minority institutions in furtherance of section 2323 of this title. 

(3) A contract awarded pursuant to the competitive procedures 

referred to in paragraphs (1) and (2) shall not be subject to the justification and approval required by subsection (f)(1). 

(4) A determination under paragraph (1) may not be made for 

a class of purchases or contracts. 

(c) The head of an agency may use procedures other than competitive procedures only when— 

(1) the property or services needed by the agency are available from only one responsible source or only from a limited 

number of responsible sources and no other type of property or 

services will satisfy the needs of the agency; 

(2) the agency’s need for the property or services is of such 

an unusual and compelling urgency that the United States 

would be seriously injured unless the agency is permitted to 

limit the number of sources from which it solicits bids or proposals; 

(3) it is necessary to award the contract to a particular 

source or sources in order (A) to maintain a facility, producer, 

manufacturer, or other supplier available for furnishing property or services in case of a national emergency or to achieve 

industrial mobilization, (B) to establish or maintain an essential engineering, research, or development capability to be provided by an educational or other nonprofit institution or a federally funded research and development center, or (C) to procure the services of an expert for use, in any litigation or dispute (including any reasonably foreseeable litigation or dispute) involving the Federal Government, in any trial, hearing, 

or proceeding before any court, administrative tribunal, or 

agency, or to procure the services of an expert or neutral for 

use in any part of an alternative dispute resolution or negotiated rulemaking process, whether or not the expert is expected to testify; 

(4) the terms of an international agreement or a treaty between the United States and a foreign government or international organization, or the written directions of a foreign 

government reimbursing the agency for the cost of the procurement of the property or services for such government, have the 

effect of requiring the use of procedures other than competitive 

procedures; 

(5) subject to subsection (k), a statute expressly authorizes 

or requires that the procurement be made through another 

agency or from a specified source, or the agency’s need is for 

a brand-name commercial item for authorized resale; 

(6) the disclosure of the agency’s needs would compromise 

the national security unless the agency is permitted to limit 

the number of sources from which it solicits bids or proposals; 

or 
§ 2304 CH. 137—PROCUREMENT GENERALLY 1138 

(7) the head of the agency— 

(A) determines that it is necessary in the public interest to use procedures other than competitive procedures in 

the particular procurement concerned, and 

(B) notifies the Congress in writing of such determination not less than 30 days before the award of the contract. 

(d)(1) For the purposes of applying subsection (c)(1)— 

(A) in the case of a contract for property or services to be 

awarded on the basis of acceptance of an unsolicited research 

proposal, the property or services shall be considered to be 

available from only one source if the source has submitted an 

unsolicited research proposal that demonstrates a concept— 

(i) that is unique and innovative or, in the case of a 

service, for which the source demonstrates a unique capability of the source to provide the service; and 

(ii) the substance of which is not otherwise available 

to the United States, and does not resemble the substance 

of a pending competitive procurement; and 

(B) in the case of a follow-on contract for the continued development or production of a major system or highly specialized equipment, or the continued provision of highly specialized 

services, such property or services may be deemed to be available only from the original source and may be procured 

through procedures other than competitive procedures when it 

is likely that award to a source other than the original source 

would result in— 

(i) substantial duplication of cost to the United States 

which is not expected to be recovered through competition; 

or 

(ii) unacceptable delays in fulfilling the agency’s 

needs. 

(2) The authority of the head of an agency under subsection 

(c)(7) may not be delegated. 

(3)(A) The contract period of a contract described in subparagraph (B) that is entered into by an agency pursuant to the authority provided under subsection (c)(2)— 

(i) may not exceed the time necessary— 

(I) to meet the unusual and compelling requirements 

of the work to be performed under the contract; and 

(II) for the agency to enter into another contract for 

the required goods or services through the use of competitive procedures; and 

(ii) may not exceed one year unless the head of the agency 

entering into such contract determines that exceptional circumstances apply. 

(B) This paragraph applies to any contract in an amount greater than the simplified acquisition threshold. 

(e) The head of an agency using procedures other than competitive procedures to procure property or services by reason of the 

application of subsection (c)(2) or (c)(6) shall request offers from as 

many potential sources as is practicable under the circumstances. 

(f)(1) Except as provided in paragraph (2), the head of an agency may not award a contract using procedures other than competitive procedures unless— 
1139 § 2304 CH. 137—PROCUREMENT GENERALLY 

(A) the contracting officer for the contract justifies the use 

of such procedures in writing and certifies the accuracy and 

completeness of the justification; 

(B) the justification is approved— 

(i) in the case of a contract for an amount exceeding $500,000 (but equal to or less than $10,000,000), by the 

competition advocate for the procuring activity (without 

further delegation) or by an official referred to in clause 

(ii) or (iii); 

(ii) in the case of a contract for an amount exceeding $10,000,000 (but equal to or less than $75,000,000), by the 

head of the procuring activity (or the head of the procuring 

activity’s delegate designated pursuant to paragraph 

(6)(A)); or 

(iii) in the case of a contract for an amount exceeding $75,000,000, by the senior procurement executive of the 

agency designated pursuant to section 1702(c) of title 41 

(without further delegation) or in the case of the Under 

Secretary of Defense for Acquisition, Technology, and Logistics, acting in his capacity as the senior procurement executive for the Department of Defense, the Under Secretary’s delegate designated pursuant to paragraph (6)(B); 

and 

(C) any required notice has been published with respect to 

such contract pursuant to section 1708 of title 41 and all bids 

or proposals received in response to that notice have been considered by the head of the agency. 

(2) In the case of a procurement permitted by subsection (c)(2), 

the justification and approval required by paragraph (1) may be 

made after the contract is awarded. The justification and approval 

required by paragraph (1) is not required— 

(A) when a statute expressly requires that the procurement be made from a specified source; 

(B) when the agency’s need is for a brand-name commercial item for authorized resale; 

(C) in the case of a procurement permitted by subsection 

(c)(7); 

(D) in the case of a procurement conducted under (i) chapter 85 of title 41, or (ii) section 8(a) of the Small Business Act 

(15 U.S.C. 637(a)); or 

(E) in the case of a procurement permitted by subsection 

(c)(4), but only if the head of the contracting activity prepares 

a document in connection with such procurement that describes the terms of an agreement or treaty, or the written directions, referred to in that subsection that have the effect of 

requiring the use of procedures other than competitive procedures. 

(3) The justification required by paragraph (1)(A) shall include— 

(A) a description of the agency’s needs; 

(B) an identification of the statutory exception from the requirement to use competitive procedures and a demonstration, 

based on the proposed contractor’s qualifications or the nature 

of the procurement, of the reasons for using that exception; 
§ 2304 CH. 137—PROCUREMENT GENERALLY 1140 

(C) a determination that the anticipated cost will be fair 

and reasonable; 

(D) a description of the market survey conducted or a 

statement of the reasons a market survey was not conducted; 

(E) a listing of the sources, if any, that expressed in writing an interest in the procurement; and 

(F) a statement of the actions, if any, the agency may take 

to remove or overcome any barrier to competition before a subsequent procurement for such needs. 

(4) In no case may the head of an agency— 

(A) enter into a contract for property or services using procedures other than competitive procedures on the basis of the 

lack of advance planning or concerns related to the amount of 

funds available to the agency for procurement functions; or 

(B) procure property or services from another agency unless such other agency complies fully with the requirements of 

this chapter in its procurement of such property or services. 

The restriction contained in clause (B) is in addition to, and not in 

lieu of, any other restriction provided by law. 

(5)(A) The authority of the head of a procuring activity under 

paragraph (1)(B)(ii) may be delegated only to an officer or employee 

who— 

(i) if a member of the armed forces, is a general or flag officer; or 

(ii) if a civilian, is serving in a position with a grade under 

the General Schedule (or any other schedule for civilian officers or employees) that is comparable to or higher than the 

grade of brigadier general or rear admiral (lower half). 

(B) The authority of the Under Secretary of Defense for Acquisition, Technology, and Logistics under paragraph (1)(B)(iii) may be 

delegated only to— 

(i) an Assistant Secretary of Defense; or 

(ii) with respect to the element of the Department of Defense (as specified in section 111(b) of this title), other than a 

military department, carrying out the procurement action concerned, an officer or employee serving in or assigned or detailed to that element who— 

(I) if a member of the armed forces, is serving in a 

grade above brigadier general or rear admiral (lower half); 

or 

(II) if a civilian, is serving in a position with a grade 

under the General Schedule (or any other schedule for civilian officers or employees) that is comparable to or higher than the grade of major general or rear admiral. 

(g)(1) In order to promote efficiency and economy in contracting 

and to avoid unnecessary burdens for agencies and contractors, the 

Federal Acquisition Regulation shall provide for— 

(A) special simplified procedures for purchases of property 

and services for amounts not greater than the simplified acquisition threshold; and 

(B) special simplified procedures for purchases of property 

and services for amounts greater than the simplified acquisition threshold but not greater than $5,000,000 with respect to 

which the contracting officer reasonably expects, based on the 
1141 § 2304 CH. 137—PROCUREMENT GENERALLY 

nature of the property or services sought and on market research, that offers will include only commercial items. 

(2) A proposed purchase or contract for an amount above the 

simplified acquisition threshold may not be divided into several 

purchases or contracts for lesser amounts in order to use the simplified procedures required by paragraph (1). 

(3) In using simplified procedures, the head of an agency shall 

promote competition to the maximum extent practicable. 

(4) The head of an agency shall comply with the Federal Acquisition Regulation provisions referred to in section 1901(e) of title 

41. 

(h) For the purposes of the following, purchases or contracts 

awarded after using procedures other than sealed-bid procedures 

shall be treated as if they were made with sealed-bid procedures: 

(1) Chapter 65 of title 41. 

(2) Sections 3141–3144, 3146, and 3147 of title 40. 

(i)(1) The Secretary of Defense shall prescribe by regulation the 

manner in which the Department of Defense negotiates prices for 

supplies to be obtained through the use of procedures other than 

competitive procedures, as defined in section 2302(2) of this title. 

(2) The regulations required by paragraph (1) shall— 

(A) specify the incurred overhead a contractor may appropriately allocate to supplies referred to in that paragraph; and 

(B) require the contractor to identify those supplies which 

it did not manufacture or to which it did not contribute significant value. 

(3) Such regulations shall not apply to an item of supply included in a contract or subcontract for which the price is based on 

established catalog or market prices of commercial items sold in 

substantial quantities to the general public. 

(j) The Federal Acquisition Regulation shall ensure that the requirement to obtain full and open competition is implemented in a 

manner that is consistent with the need to efficiently fulfill the 

Government’s requirements. 

(k)(1) It is the policy of Congress that an agency named in section 2303(a)of this title should not be required by legislation to 

award a new contract to a specific non-Federal Government entity. 

It is further the policy of Congress that any program, project, or 

technology identified in legislation be procured through merit-based 

selection procedures. 

(2) A provision of law may not be construed as requiring a new 

contract to be awarded to a specified non-Federal Government entity unless that provision of law— 

(A) specifically refers to this subsection; 

(B) specifically identifies the particular non-Federal Government entity involved; and 

(C) specifically states that the award to that entity is required by such provision of law in contravention of the policy 

set forth in paragraph (1). 

(3) For purposes of this subsection, a contract is a new contract 

unless the work provided for in the contract is a continuation of the 

work performed by the specified entity under a preceding contract. 

(4) This subsection shall not apply with respect to any contract 

that calls upon the National Academy of Sciences to investigate, ex-
§ 2304a CH. 137—PROCUREMENT GENERALLY 1142 

amine, or experiment upon any subject of science or art of significance to an agency named in section 2303(a) of this title and to report on such matters to the Congress or any agency of the Federal 

Government. 

(l)(1)(A) Except as provided in subparagraph (B), in the case of 

a procurement permitted by subsection (c), the head of an agency 

shall make publicly available, within 14 days after the award of the 

contract, the documents containing the justification and approval 

required by subsection (f)(1) with respect to the procurement. 

(B) In the case of a procurement permitted by subsection (c)(2), 

subparagraph (A) shall be applied by substituting ‘‘30 days’’ for ‘‘14 

days’’. 

(2) The documents shall be made available on the website of 

the agency and through a government-wide website selected by the 

Administrator for Federal Procurement Policy. 

(3) This subsection does not require the public availability of 

information that is exempt from public disclosure under section 

552(b) of title 5. 

(Aug. 10, 1956, ch. 1041, 70A Stat. 128; Pub. L. 85–800, Sec. 8, Aug. 28, 1958, 72 Stat. 967; 

Pub. L. 85–861, Sec. 33(a)(12), Sept. 2, 1958, 72 Stat. 1565; Pub. L. 87–653, Sec. 1(a)–(c), Sept. 

10, 1962, 76 Stat. 528; Pub. L. 90–268, Sec. 5, Mar. 16, 1968, 82 Stat. 50; Pub. L. 90–500, title 

IV, Sec. 405, Sept. 20, 1968, 82 Stat. 851; Pub. L. 93–356, Sec. 4, July 25, 1974, 88 Stat. 390; 

Pub. L. 96–513, title V, Sec. 511(76), Dec. 12, 1980, 94 Stat. 2926; Pub. L. 97–86, title IX, Sec. 

907(a), Dec. 1, 1981, 95 Stat. 1117; Pub. L. 97–295, Sec. 1(24), Oct. 12, 1982, 96 Stat. 1290; 

Pub. L. 97–375, title I, Sec. 114, Dec. 21, 1982, 96 Stat. 1821; Pub. L. 98–369, div. B, title VII, 

Secs. 2723(a), 2727(b), July 18, 1984, 98 Stat. 1187, 1194; Pub. L. 98–577, title V, Sec. 504(b)(1), 

(2), Oct. 30, 1984, 98 Stat. 3086; Pub. L. 99–145, title IX, Sec. 961(a)(1), title XIII, Sec. 

1303(a)(13), Nov. 8, 1985, 99 Stat. 703, 739; Pub. L. 99–500, Sec. 101(c) [title X, Secs. 923(a)– 

(c), 927(a)], Oct. 18, 1986, 100 Stat. 1783–82, 1783–152, 1783–155, and Pub. L. 99–591, Sec. 

101(c) [title X, Secs. 923(a)–(c), 927(a)], Oct. 30, 1986, 100 Stat. 3341–82, 3341–152, 3341–155; 

Pub. L. 99–661, div. A, title IX, formerly title IV, Secs. 923(a)–(c), 927(a), title XIII, Sec. 

1343(a)(14), Nov. 14, 1986, 100 Stat. 3932, 3935, 3993, renumbered title IX, Pub. L. 100–26, 

Sec. 3(5), Apr. 21, 1987, 101 Stat. 273; Pub. L. 100–26, Sec. 7(d)(3), Apr. 21, 1987, 101 Stat. 

281; Pub. L. 100–456, div. A, title VIII, Sec. 803, Sept. 29, 1988, 102 Stat. 2008; Pub. L. 101– 

189, div. A, title VIII, Secs. 812, 817, 818, 853(d), Nov. 29, 1989, 103 Stat. 1493, 1501, 1502, 

1519; Pub. L. 101–510, div. A, title VIII, Sec. 806(b), Nov. 5, 1990, 104 Stat. 1592; Pub. L. 102– 

25, title VII, Sec. 701(d)(2), Apr. 6, 1991, 105 Stat. 114; Pub. L. 102–484, div. A, title VIII, Secs. 

801(h)(2), 816, title X, Sec. 1052(23), Oct. 23, 1992, 106 Stat. 2445, 2454, 2500; Pub. L. 103– 

160, div. A, title IX, Sec. 904(d)(1), Nov. 30, 1993, 107 Stat. 1728; Pub. L. 103–355, title I, Secs. 

1001–1003, 1004(b), 1005, title IV, Sec. 4401(a), title VII, Sec. 7203(a)(1), Oct. 13, 1994, 108 

Stat. 3249, 3253, 3254, 3347, 3379; Pub. L. 104–106, div. D, title XLI, Secs. 4101(a), 4102(a), 

title XLII, Sec. 4202(a)(1), title XLIII, Sec. 4321(b)(4), (5), Feb. 10, 1996, 110 Stat. 642, 643, 652, 

672; Pub. L. 104–320, Secs. 7(a)(1), 11(c)(1), Oct. 19, 1996, 110 Stat. 3871, 3873; Pub. L. 105– 

85, div. A, title VIII, Secs. 841(b), 850(f)(3)(B), title X, Sec. 1073(a)(42), (43), Nov. 18, 1997, 111 

Stat. 1843, 1850, 1902; Pub. L. 107–107, div. A, title X, Sec. 1048(b)(2), Dec. 28, 2001, 115 Stat. 

1225; Pub. L. 107–217, Sec. 3(b)(3), Aug. 21, 2002, 116 Stat. 1295; Pub. L. 108–375, div. A, title 

VIII, Sec. 815, Oct. 28, 2004, 118 Stat. 2015; Pub. L. 109–364, div. A, title X, Sec. 1071(a)(2), 

Oct. 17, 2006, 120 Stat. 2398; Pub. L. 110–181, div. A, title VIII, Sec. 844(b), Jan. 28, 2008, 

122 Stat. 239; Pub. L. 110–417, [div. A], title VIII, Sec. 862(b), Oct. 14, 2008, 122 Stat. 4546; 

Pub. L. 111–350, Sec. 5(b)(12), Jan. 4, 2011, 124 Stat. 3843.) 

§ 2304a. Task and delivery order contracts: general authority 

(a) AUTHORITY TO AWARD.—Subject to the requirements of this 

section, section 2304c of this title, and other applicable law, the 

head of an agency may enter into a task or delivery order contract 

(as defined in section 2304d of this title) for procurement of services or property. 

(b) SOLICITATION.—The solicitation for a task or delivery order 

contract shall include the following: 

(1) The period of the contract, including the number of options to extend the contract and the period for which the contract may be extended under each option, if any. 
1143 § 2304a CH. 137—PROCUREMENT GENERALLY 

(2) The maximum quantity or dollar value of the services 

or property to be procured under the contract. 

(3) A statement of work, specifications, or other description 

that reasonably describes the general scope, nature, complexity, and purposes of the services or property to be procured 

under the contract. 

(c) APPLICABILITY OF RESTRICTION ON USE OF NONCOMPETITIVE

PROCEDURES.—The head of an agency may use procedures other 

than competitive procedures to enter into a task or delivery order 

contract under this section only if an exception in subsection (c) of 

section 2304 of this title applies to the contract and the use of such 

procedures is approved in accordance with subsection (f) of such 

section. 

(d) SINGLE AND MULTIPLE CONTRACT AWARDS.—(1) The head of 

an agency may exercise the authority provided in this section— 

(A) to award a single task or delivery order contract; or 

(B) if the solicitation states that the head of the agency 

has the option to do so, to award separate task or delivery 

order contracts for the same or similar services or property to 

two or more sources. 

(2) No determination under section 2304(b) of this title is required for award of multiple task or delivery order contracts under 

paragraph (1)(B). 

(3)(A) No task or delivery order contract in an amount esti- mated to exceed $100,000,000 (including all options) may be awarded to a single source unless the head of the agency determines in 

writing that— 

(i) the task or delivery orders expected under the contract 

are so integrally related that only a single source can reasonably perform the work; 

(ii) the contract provides only for firm, fixed price task orders or delivery orders for— 

(I) products for which unit prices are established in 

the contract; or 

(II) services for which prices are established in the 

contract for the specific tasks to be performed; 

(iii) only one source is qualified and capable of performing 

the work at a reasonable price to the government; or 

(iv) because of exceptional circumstances, it is necessary in 

the public interest to award the contract to a single source. 

(B) The head of the agency shall notify the congressional defense committees within 30 days after any determination under 

clause (i), (ii), (iii), or (iv) of subparagraph (A). 

(4) The regulations implementing this subsection shall— 

(A) establish a preference for awarding, to the maximum 

extent practicable, multiple task or delivery order contracts for 

the same or similar services or property under the authority of 

paragraph (1)(B); and 

(B) establish criteria for determining when award of multiple task or delivery order contracts would not be in the best 

interest of the Federal Government. 

(e) CONTRACT MODIFICATIONS.—A task or delivery order may 

not increase the scope, period, or maximum value of the task or delivery order contract under which the order is issued. The scope, 
§ 2304b CH. 137—PROCUREMENT GENERALLY 1144 

period, or maximum value of the contract may be increased only by 

modification of the contract. 

(f) CONTRACT PERIOD.—The head of an agency entering into a 

task or delivery order contract under this section may provide for 

the contract to cover any period up to five years and may extend 

the contract period for one or more successive periods pursuant to 

an option provided in the contract or a modification of the contract. 

The total contract period as extended may not exceed 10 years unless such head of an agency determines in writing that exceptional 

circumstances necessitate a longer contract period. 

(g) INAPPLICABILITY TO CONTRACTS FOR ADVISORY AND ASSISTANCE SERVICES.—Except as otherwise specifically provided in section 2304b of this title, this section does not apply to a task or delivery order contract for the procurement of advisory and assistance 

services (as defined in section 1105(g) of title 31). 

(h) RELATIONSHIP TO OTHER CONTRACTING AUTHORITY.—Nothing in this section may be construed to limit or expand any authority of the head of an agency or the Administrator of General Services to enter into schedule, multiple award, or task or delivery 

order contracts under any other provision of law. 

(Added Pub. L. 103–355, title I, Sec. 1004(a)(1), Oct. 13, 1994, 108 Stat. 3249; amended Pub. 

L. 108–136, div. A, title VIII, Sec. 843(b), Nov. 24, 2003, 117 Stat. 1553; Pub. L. 108–375, div. 

A, title VIII, Sec. 813(a), Oct. 28, 2004, 118 Stat. 2014; Pub. L. 110–181, div. A, title VIII, Sec. 

843(a)(1), Jan. 28, 2008, 122 Stat. 236; Pub. L. 111–84, div. A, title VIII, Sec. 814(a), Oct. 28, 

2009, 123 Stat. 2407.) 

§ 2304b. Task order contracts: advisory and assistance services 

(a) AUTHORITY TO AWARD.—(1) Subject to the requirements of 

this section, section 2304c of this title, and other applicable law, 

the head of an agency may enter into a task order contract (as defined in section 2304d of this title) for procurement of advisory and 

assistance services. 

(2) The head of an agency may enter into a task order contract 

for procurement of advisory and assistance services only under the 

authority of this section. 

(b) LIMITATION ON CONTRACT PERIOD.—The period of a task 

order contract entered into under this section, including all periods 

of extensions of the contract under options, modifications, or otherwise, may not exceed five years unless a longer period is specifically authorized in a law that is applicable to such contract. 

(c) CONTENT OF NOTICE.—The notice required by section 1708 

of title 41 and section 8(e) of the Small Business Act (15 U.S.C. 

637(e)) shall reasonably and fairly describe the general scope, magnitude, and duration of the proposed task order contract in a manner that would reasonably enable a potential offeror to decide 

whether to request the solicitation and consider submitting an 

offer. 

(d) REQUIRED CONTENT OF SOLICITATION AND CONTRACT.—(1) 

The solicitation for the proposed task order contract shall include 

the information (regarding services) described in section 2304a(b) 

of this title. 

(2) A task order contract entered into under this section shall 

contain the same information that is required by paragraph (1) to 

be included in the solicitation of offers for that contract. 
1145 § 2304b CH. 137—PROCUREMENT GENERALLY 

(e) MULTIPLE AWARDS.—(1) The head of an agency may, on the 

basis of one solicitation, award separate task order contracts under 

this section for the same or similar services to two or more sources 

if the solicitation states that the head of the agency has the option 

to do so. 

(2) If, in the case of a task order contract for advisory and assistance services to be entered into under this section, the contract 

period is to exceed three years and the contract amount is estimated to exceed $10,000,000 (including all options), the solicitation 

shall— 

(A) provide for a multiple award authorized under paragraph (1); and 

(B) include a statement that the head of the agency may 

also elect to award only one task order contract if the head of 

the agency determines in writing that only one of the offerers 

is capable of providing the services required at the level of 

quality required. 

(3) Paragraph (2) does not apply in the case of a solicitation 

for which the head of the agency concerned determines in writing 

that, because the services required under the task order contract 

are unique or highly specialized, it is not practicable to award more 

than one contract. 

(f) CONTRACT MODIFICATIONS.—(1) A task order may not increase the scope, period, or maximum value of the task order contract under which the order is issued. The scope, period, or maximum value of the contract may be increased only by modification 

of the contract. 

(2) Unless use of procedures other than competitive procedures 

is authorized by an exception in subsection (c) of section 2304 of 

this title and approved in accordance with subsection (f) of such 

section, competitive procedures shall be used for making such a 

modification. 

(3) Notice regarding the modification shall be provided in accordance with section 1708 of title 41 and section 8(e) of the Small 

Business Act (15 U.S.C. 637(e)). 

(g) CONTRACT EXTENSIONS.—(1) Notwithstanding the limitation 

on the contract period set forth in subsection (b) or in a solicitation 

or contract pursuant to subsection (e), a task order contract entered 

into by the head of an agency under this section may be extended 

on a sole-source basis for a period not exceeding six months if the 

head of such agency determines that— 

(A) the award of a follow-on contract has been delayed by 

circumstances that were not reasonably foreseeable at the time 

the initial contract was entered into; and 

(B) the extension is necessary in order to ensure continuity 

of the receipt of services pending the award of, and commencement of performance under, the follow-on contract. 

(2) A task order contract may be extended under the authority 

of paragraph (1) only once and only in accordance with the limitations and requirements of this subsection. 

(h) INAPPLICABILITY TO CERTAIN CONTRACTS.—This section 

does not apply to a contract for the acquisition of property or services that includes acquisition of advisory and assistance services if 

the head of an agency entering into such contract determines that, 
§ 2304c CH. 137—PROCUREMENT GENERALLY 1146 

under the contract, advisory and assistance services are necessarily 

incident to, and not a significant component of, the contract. 

(i) ADVISORY AND ASSISTANCE SERVICES DEFINED.—In this section, the term ‘‘advisory and assistance services’’ has the meaning 

given such term in section 1105(g) of title 31. 

(Added Pub. L. 103–355, title I, Sec. 1004(a)(1), Oct. 13, 1994, 108 Stat. 3251; Pub. L. 111–350, 

Sec. 5(b)(13), Jan. 4, 2011, 124 Stat. 3843.) 

§ 2304c. Task and delivery order contracts: orders 

(a) ISSUANCE OF ORDERS.—The following actions are not required for issuance of a task or delivery order under a task or delivery order contract: 

(1) A separate notice for such order under section 1708 of 

title 41 or section 8(e) of the Small Business Act (15 U.S.C. 

637(e)). 

(2) Except as provided in subsection (b), a competition (or 

a waiver of competition approved in accordance with section 

2304(f) of this title) that is separate from that used for entering into the contract. 

(b) MULTIPLE AWARD CONTRACTS.—When multiple task or delivery order contracts are awarded under section 2304a(d)(1)(B) or 

2304b(e) of this title, all contractors awarded such contracts shall 

be provided a fair opportunity to be considered, pursuant to procedures set forth in the contracts, for each task or delivery order in 

excess of $2,500 that is to be issued under any of the contracts unless— 

(1) the agency’s need for the services or property ordered 

is of such unusual urgency that providing such opportunity to 

all such contractors would result in unacceptable delays in fulfilling that need; 

(2) only one such contractor is capable of providing the 

services or property required at the level of quality required 

because the services or property ordered are unique or highly 

specialized; 

(3) the task or delivery order should be issued on a solesource basis in the interest of economy and efficiency because 

it is a logical follow-on to a task or delivery order already 

issued on a competitive basis; or 

(4) it is necessary to place the order with a particular contractor in order to satisfy a minimum guarantee. 

(c) STATEMENT OF WORK.—A task or delivery order shall include a statement of work that clearly specifies all tasks to be performed or property to be delivered under the order. 

(d) ENHANCED COMPETITION FOR ORDERS IN EXCESS OF

$5,000,000.—In the case of a task or delivery order in excess of 

$5,000,000, the requirement to provide all contractors a fair opportunity to be considered under subsection (b) is not met unless all 

such contractors are provided, at a minimum— 

(1) a notice of the task or delivery order that includes a 

clear statement of the agency’s requirements; 

(2) a reasonable period of time to provide a proposal in response to the notice; 
1147 § 2304d CH. 137—PROCUREMENT GENERALLY 

(3) disclosure of the significant factors and subfactors, including cost or price, that the agency expects to consider in 

evaluating such proposals, and their relative importance; 

(4) in the case of an award that is to be made on a best 

value basis, a written statement documenting the basis for the 

award and the relative importance of quality and price or cost 

factors; and 

(5) an opportunity for a post-award debriefing consistent 

with the requirements of section 2305(b)(5) of this title. 

(e) PROTESTS.—(1) A protest is not authorized in connection 

with the issuance or proposed issuance of a task or delivery order 

except for— 

(A) a protest on the ground that the order increases the 

scope, period, or maximum value of the contract under which 

the order is issued; or 

(B) a protest of an order valued in excess of $10,000,000. 

(2) Notwithstanding section 3556 of title 31, the Comptroller 

General of the United States shall have exclusive jurisdiction of a 

protest authorized under paragraph (1)(B). 

(3) Paragraph (1)(B) and paragraph (2) of this subsection shall 

not be in effect after September 30, 2016. 

(f) TASK AND DELIVERY ORDER OMBUDSMAN.—Each head of an 

agency who awards multiple task or delivery order contracts pursuant to section 2304a(d)(1)(B) or 2304b(e) of this title shall appoint 

or designate a task and delivery order ombudsman who shall be responsible for reviewing complaints from the contractors on such 

contracts and ensuring that all of the contractors are afforded a 

fair opportunity to be considered for task or delivery orders when 

required under subsection (b). The task and delivery order ombudsman shall be a senior agency official who is independent of the contracting officer for the contracts and may be the agency’s competition advocate. 

(g) APPLICABILITY.—This section applies to task and delivery 

order contracts entered into under sections 2304a and 2304b of this 

title. 

(Added Pub. L. 103–355, title I, Sec. 1004(a)(1), Oct. 13, 1994, 108 Stat. 3252; amended Pub. 

L. 110–181, div. A, title VIII, Sec. 843(a)(2), Jan. 28, 2008, 122 Stat. 237; Pub. L. 111–350, Sec. 

5(b)(14), Jan. 4, 2011, 124 Stat. 3843; Pub. L. 111–383, div. A, title VIII, Sec. 825, title X, Sec. 

1075(f)(5)(A), Jan. 7, 2011, 124 Stat. 4270, 4376.) 

§ 2304d. Task and delivery order contracts: definitions 

In sections 2304a, 2304b, and 2304c of this title: 

(1) The term ‘‘task order contract’’ means a contract for 

services that does not procure or specify a firm quantity of 

services (other than a minimum or maximum quantity) and 

that provides for the issuance of orders for the performance of 

tasks during the period of the contract. 

(2) The term ‘‘delivery order contract’’ means a contract for 

property that does not procure or specify a firm quantity of 

property (other than a minimum or maximum quantity) and 

that provides for the issuance of orders for the delivery of property during the period of the contract. 

(Added Pub. L. 103–355, title I, Sec. 1004(a)(1), Oct. 13, 1994, 108 Stat. 3253.) 
§ 2304e CH. 137—PROCUREMENT GENERALLY 1148 

§ 2304e. Contracts: prohibition on competition between Department of Defense and small businesses and certain other entities 

(a) EXCLUSION.—In any case in which the Secretary of Defense 

plans to use competitive procedures for a procurement, if the procurement is to be conducted as described in subsection (b), then the 

Secretary shall exclude the Department of Defense from competing 

in the procurement. 

(b) PROCUREMENT DESCRIPTION.—The requirement to exclude 

the Department of Defense under subsection (a) applies in the case 

of a procurement to be conducted by excluding from competition entities in the private sector other than— 

(1) small business concerns in furtherance of section 8 or 

15 of the Small Business Act (15 U.S.C. 637 or 644); or 

(2) entities described in subsection (a)(1) of section 2323 of 

this title in furtherance of the goal specified in that subsection. 

(Added Pub. L. 103–160, div. A, title VIII, Sec. 848(a)(1), Nov. 30, 1993, 107 Stat. 1724, Sec. 

2304a; renumbered Sec. 2304e, Pub. L. 104–106, div. D, title XLIII, Sec. 4321(b)(6)(A), Feb. 10, 

1996, 110 Stat. 672.) 

§ 2305. Contracts: planning, solicitation, evaluation, and 

award procedures 

(a)(1)(A) In preparing for the procurement of property or services, the head of an agency shall— 

(i) specify the agency’s needs and solicit bids or proposals 

in a manner designed to achieve full and open competition for 

the procurement; 

(ii) use advance procurement planning and market research; and 

(iii) develop specifications in such manner as is necessary 

to obtain full and open competition with due regard to the nature of the property or services to be acquired. 

(B) Each solicitation under this chapter shall include specifications which— 

(i) consistent with the provisions of this chapter, permit 

full and open competition; and 

(ii) include restrictive provisions or conditions only to the 

extent necessary to satisfy the needs of the agency or as authorized by law. 

(C) For the purposes of subparagraphs (A) and (B), the type of 

specification included in a solicitation shall depend on the nature 

of the needs of the agency and the market available to satisfy such 

needs. Subject to such needs, specifications may be stated in terms 

of— 

(i) function, so that a variety of products or services may 

qualify; 

(ii) performance, including specifications of the range of acceptable characteristics or of the minimum acceptable standards; or 

(iii) design requirements. 

(2) In addition to the specifications described in paragraph (1), 

a solicitation for sealed bids or competitive proposals (other than 

for a procurement for commercial items using special simplified 
1149 § 2305 CH. 137—PROCUREMENT GENERALLY 

procedures or a purchase for an amount not greater than the simplified acquisition threshold) shall at a minimum include— 

(A) a statement of— 

(i) all significant factors and significant subfactors 

which the head of the agency reasonably expects to consider in evaluating sealed bids (including price) or competitive proposals (including cost or price, cost-related or pricerelated factors and subfactors, and noncost-related or 

nonprice-related factors and subfactors); and 

(ii) the relative importance assigned to each of those 

factors and subfactors; and 

(B)(i) in the case of sealed bids— 

(I) a statement that sealed bids will be evaluated without discussions with the bidders; and 

(II) the time and place for the opening of the sealed 

bids; or 

(ii) in the case of competitive proposals— 

(I) either a statement that the proposals are intended 

to be evaluated with, and award made after, discussions 

with the offerors, or a statement that the proposals are intended to be evaluated, and award made, without discussions with the offerors (other than discussions conducted 

for the purpose of minor clarification) unless discussions 

are determined to be necessary; and 

(II) the time and place for submission of proposals. 

(3)(A) In prescribing the evaluation factors to be included in 

each solicitation for competitive proposals, the head of an agency— 

(i) shall clearly establish the relative importance assigned 

to the evaluation factors and subfactors, including the quality 

of the product or services to be provided (including technical 

capability, management capability, prior experience, and past 

performance of the offeror); 

(ii) shall include cost or price to the Federal Government 

as an evaluation factor that must be considered in the evaluation of proposals; and 

(iii) shall disclose to offerors whether all evaluation factors 

other than cost or price, when combined, are— 

(I) significantly more important than cost or price; 

(II) approximately equal in importance to cost or price; 

or 

(III) significantly less important than cost or price. 

(B) The regulations implementing clause (iii) of subparagraph 

(A) may not define the terms ‘‘significantly more important’’ and 

‘‘significantly less important’’ as specific numeric weights that 

would be applied uniformly to all solicitations or a class of solicitations. 

(4) Nothing in this subsection prohibits an agency from— 

(A) providing additional information in a solicitation, including numeric weights for all evaluation factors and subfactors on a case-by-case basis; or 

(B) stating in a solicitation that award will be made to the 

offeror that meets the solicitation’s mandatory requirements at 

the lowest cost or price. 
§ 2305 CH. 137—PROCUREMENT GENERALLY 1150 

(5) The head of an agency, in issuing a solicitation for a contract to be awarded using sealed bid procedures, may not include 

in such solicitation a clause providing for the evaluation of prices 

for options to purchase additional property or services under the 

contract unless the head of the agency has determined that there 

is a reasonable likelihood that the options will be exercised. 

(b)(1) The head of an agency shall evaluate sealed bids and 

competitive proposals and make an award based solely on the factors specified in the solicitation. 

(2) All sealed bids or competitive proposals received in response to a solicitation may be rejected if the head of the agency 

determines that such action is in the public interest. 

(3) Sealed bids shall be opened publicly at the time and place 

stated in the solicitation. The head of the agency shall evaluate the 

bids in accordance with paragraph (1) without discussions with the 

bidders and, except as provided in paragraph (2), shall award a 

contract with reasonable promptness to the responsible bidder 

whose bid conforms to the solicitation and is most advantageous to 

the United States, considering only price and the other price-related factors included in the solicitation. The award of a contract 

shall be made by transmitting, in writing or by electronic means, 

notice of the award to the successful bidder. Within three days 

after the date of contract award, the head of the agency shall notify, in writing or by electronic means, each bidder not awarded the 

contract that the contract has been awarded. 

(4)(A) The head of an agency shall evaluate competitive proposals in accordance with paragraph (1) and may award a contract— 

(i) after discussions with the offerors, provided that written or oral discussions have been conducted with all responsible offerors who submit proposals within the competitive 

range; or 

(ii) based on the proposals received, without discussions 

with the offerors (other than discussions conducted for the purpose of minor clarification) provided that the solicitation included a statement that proposals are intended to be evaluated, and award made, without discussions, unless discussions 

are determined to be necessary. 

(B) If the contracting officer determines that the number of 

offerors that would otherwise be included in the competitive range 

under subparagraph (A)(i) exceeds the number at which an efficient 

competition can be conducted, the contracting officer may limit the 

number of proposals in the competitive range, in accordance with 

the criteria specified in the solicitation, to the greatest number that 

will permit an efficient competition among the offerors rated most 

highly in accordance with such criteria. 

(C) Except as provided in paragraph (2), the head of the agency 

shall award a contract with reasonable promptness to the responsible source whose proposal is most advantageous to the United 

States, considering only cost or price and the other factors included 

in the solicitation. The head of the agency shall award the contract 

by transmitting, in writing or by electronic means, notice of the 

award to such source and, within three days after the date of contract award, shall notify, in writing or by electronic means, all 
1151 § 2305 CH. 137—PROCUREMENT GENERALLY 

other offerors of the rejection of their proposals. This subparagraph 

does not apply with respect to the award of a contract for the acquisition of perishable subsistence items. 

(5)(A) When a contract is awarded by the head of an agency 

on the basis of competitive proposals, an unsuccessful offeror, upon 

written request received by the agency within 3 days after the date 

on which the unsuccessful offeror receives the notification of the 

contract award, shall be debriefed and furnished the basis for the 

selection decision and contract award. The head of the agency shall 

debrief the offeror within, to the maximum extent practicable, five 

days after receipt of the request by the agency. 

(B) The debriefing shall include, at a minimum— 

(i) the agency’s evaluation of the significant weak or deficient factors in the offeror’s offer; 

(ii) the overall evaluated cost and technical rating of the 

offer of the contractor awarded the contract and the overall 

evaluated cost and technical rating of the offer of the debriefed 

offeror; 

(iii) the overall ranking of all offers; 

(iv) a summary of the rationale for the award; 

(v) in the case of a proposal that includes a commercial 

item that is an end item under the contract, the make and 

model of the item being provided in accordance with the offer 

of the contractor awarded the contract; and 

(vi) reasonable responses to relevant questions posed by 

the debriefed offeror as to whether source selection procedures 

set forth in the solicitation, applicable regulations, and other 

applicable authorities were followed by the agency. 

(C) The debriefing may not include point-by-point comparisons 

of the debriefed offeror’s offer with other offers and may not disclose any information that is exempt from disclosure under section 

552(b) of title 5. 

(D) Each solicitation for competitive proposals shall include a 

statement that information described in subparagraph (B) may be 

disclosed in post-award debriefings. 

(E) If, within one year after the date of the contract award and 

as a result of a successful procurement protest, the agency seeks 

to fulfill the requirement under the protested contract either on the 

basis of a new solicitation of offers or on the basis of new best and 

final offers requested for that contract, the agency shall make 

available to all offerors— 

(i) the information provided in debriefings under this paragraph regarding the offer of the contractor awarded the contract; and 

(ii) the same information that would have been provided to 

the original offerors. 

(6)(A) When the contracting officer excludes an offeror submitting a competitive proposal from the competitive range (or otherwise excludes such an offeror from further consideration prior to 

the final source selection decision), the excluded offeror may request in writing, within three days after the date on which the excluded offeror receives notice of its exclusion, a debriefing prior to 

award. The contracting officer shall make every effort to debrief the 

unsuccessful offeror as soon as practicable but may refuse the re-
§ 2305 CH. 137—PROCUREMENT GENERALLY 1152 

quest for a debriefing if it is not in the best interests of the Government to conduct a debriefing at that time. 

(B) The contracting officer is required to debrief an excluded offeror in accordance with paragraph (5) only if that offeror requested and was refused a preaward debriefing under subparagraph (A). 

(C) The debriefing conducted under subparagraph (A) shall include— 

(i) the executive agency’s evaluation of the significant elements in the offeror’s offer; 

(ii) a summary of the rationale for the offeror’s exclusion; 

and 

(iii) reasonable responses to relevant questions posed by 

the debriefed offeror as to whether source selection procedures 

set forth in the solicitation, applicable regulations, and other 

applicable authorities were followed by the executive agency. 

(D) The debriefing conducted under subparagraph (A) may not 

disclose the number or identity of other offerors and shall not disclose information about the content, ranking, or evaluation of other 

offerors’ proposals. 

(7) The contracting officer shall include a summary of any debriefing conducted under paragraph (5) or (6) in the contract file. 

(8) The Federal Acquisition Regulation shall include a provision encouraging the use of alternative dispute resolution techniques to provide informal, expeditious, and inexpensive procedures 

for an offeror to consider using before filing a protest, prior to the 

award of a contract, of the exclusion of the offeror from the competitive range (or otherwise from further consideration) for that 

contract. 

(9) If the head of an agency considers that a bid or proposal 

evidences a violation of the antitrust laws, he shall refer the bid 

or proposal to the Attorney General for appropriate action. 

(c) The Secretary of Defense shall ensure that before a contract 

for the delivery of supplies to the Department of Defense is entered 

into— 

(1) when the appropriate officials of the Department are 

making an assessment of the most advantageous source for acquisition of the supplies (considering quality, price, delivery, 

and other factors), there is a review of the availability and cost 

of each item of supply— 

(A) through the supply system of the Department of 

Defense; and 

(B) under standard Government supply contracts, if 

the item is in a category of supplies defined under regulations of the Secretary of Defense as being potentially available under a standard Government supply contract; and 

(2) there is a review of both the procurement history of the 

item and a description of the item, including, when necessary 

for an adequate description of the item, a picture, drawing, diagram, or other graphic representation of the item. 

(d)(1)(A) The Secretary of Defense shall ensure that, in preparing a solicitation for the award of a development contract for a 

major system, the head of an agency consider requiring in the solicitation that an offeror include in its offer proposals described in 
1153 § 2305 CH. 137—PROCUREMENT GENERALLY 

subparagraph (B). In determining whether to require such proposals, the head of the agency shall give due consideration to the 

purposes for which the system is being procured and the technology 

necessary to meet the system’s required capabilities. If such proposals are required, the head of the agency shall consider them in 

evaluating the offeror’s price. 

(B) Proposals referred to in the first sentence of subparagraph 

(A) are the following: 

(i) Proposals to incorporate in the design of the major system items which are currently available within the supply system of the Federal agency responsible for the major system, 

available elsewhere in the national supply system, or commercially available from more than one source. 

(ii) With respect to items that are likely to be required in 

substantial quantities during the system’s service life, proposals to incorporate in the design of the major system items 

which the United States will be able to acquire competitively 

in the future. 

(2)(A) The Secretary of Defense shall ensure that, in preparing 

a solicitation for the award of a production contract for a major system, the head of an agency consider requiring in the solicitation 

that an offeror include in its offer proposals described in subparagraph (B). In determining whether to require such proposals, the 

head of the agency shall give due consideration to the purposes for 

which the system is being procured and the technology necessary 

to meet the system’s required capabilities. If such proposals are required, the head of the agency shall consider them in evaluating 

the offeror’s price. 

(B) Proposals referred to in the first sentence of subparagraph 

(A) are proposals identifying opportunities to ensure that the 

United States will be able to obtain on a competitive basis items 

procured in connection with the system that are likely to be reprocured in substantial quantities during the service life of the system. Proposals submitted in response to such requirement may include the following: 

(i) Proposals to provide to the United States the right to 

use technical data to be provided under the contract for competitive reprocurement of the item, together with the cost to 

the United States, if any, of acquiring such technical data and 

the right to use such data. 

(ii) Proposals for the qualification or development of multiple sources of supply for the item. 

(3) If the head of an agency is making a noncompetitive award 

of a development contract or a production contract for a major system, the factors specified in paragraphs (1) and (2) to be considered 

in evaluating an offer for a contract may be considered as objectives in negotiating the contract to be awarded. Such objectives 

may not impair the rights of prospective contractors or subcontractors otherwise provided by law. 

(4)(A) Whenever the head of an agency requires that proposals 

described in paragraph (1)(B) or (2)(B) be submitted by an offeror 

in its offer, the offeror shall not be required to provide a proposal 

that enables the United States to acquire competitively in the fu-
§ 2305 CH. 137—PROCUREMENT GENERALLY 1154 

ture an identical item if the item was developed exclusively at private expense unless the head of the agency determines that— 

(i) the original supplier of such item will be unable to satisfy program schedule or delivery requirements; or 

(ii) proposals by the original supplier of such item to meet 

the mobilization requirements are insufficient to meet the 

agency’s mobilization needs. 

(B) In considering offers in response to a solicitation requiring 

proposals described in paragraph (1)(B) or (2)(B), the head of an 

agency shall base any evaluation of items developed exclusively at 

private expense on an analysis of the total value, in terms of innovative design, life-cycle costs, and other pertinent factors, of incorporating such items in the system. 

(e) PROTEST FILE.—(1) If, in the case of a solicitation for a contract issued by, or an award or proposed award of a contract by, 

the head of an agency, a protest is filed pursuant to the procedures 

in subchapter V of chapter 35 of title 31 and an actual or prospective offeror so requests, a file of the protest shall be established by 

the procuring activity and reasonable access shall be provided to 

actual or prospective offerors. 

(2) Information exempt from disclosure under section 552 of 

title 5 may be redacted in a file established pursuant to paragraph 

(1) unless an applicable protective order provides otherwise. 

(f) AGENCY ACTIONS ON PROTESTS.—If, in connection with a 

protest, the head of an agency determines that a solicitation, proposed award, or award does not comply with the requirements of 

law or regulation, the head of the agency— 

(1) may take any action set out in subparagraphs (A) 

through (F) of subsection (b)(1) of section 3554 of title 31; and 

(2) may pay costs described in paragraph (1) of section 

3554(c) of title 31 within the limits referred to in paragraph (2) 

of such section. 

(g) PROHIBITION ON RELEASE OF CONTRACTOR PROPOSALS.—(1) 

Except as provided in paragraph (2), a proposal in the possession 

or control of an agency named in section 2303 of this title may not 

be made available to any person under section 552 of title 5. 

(2) Paragraph (1) does not apply to any proposal that is set 

forth or incorporated by reference in a contract entered into between the Department and the contractor that submitted the proposal. 

(3) In this subsection, the term ‘‘proposal’’ means any proposal, 

including a technical, management, or cost proposal, submitted by 

a contractor in response to the requirements of a solicitation for a 

competitive proposal. 

(Aug. 10, 1956, ch. 1041, 70A Stat. 130; Pub. L. 85–861, Sec. 1(44), Sept. 2, 1958, 72 Stat. 1457; 

Pub. L. 90–268, Sec. 3, Mar. 16, 1968, 82 Stat. 49; Pub. L. 98–369, div. B, title VII, Sec. 2723(b), 

July 18, 1984, 98 Stat. 1191; Pub. L. 98–525, title XII, Sec. 1213(a), Oct. 19, 1984, 98 Stat. 2591; 

Pub. L. 99–145, title XIII, Sec. 1303(a)(14), Nov. 8, 1985, 99 Stat. 739; Pub. L. 99–500, Sec. 

101(c) [title X, Sec. 924(a), (b)], Oct. 18, 1986, 100 Stat. 1783–82, 1783–153, and Pub. L. 99– 

591, Sec. 101(c) [title X, Sec. 924(a), (b)], Oct. 30, 1986, 100 Stat. 3341–82, 3341–153; Pub. L. 

99–661, div. A, title III, Sec. 313(b), title IX, formerly title IV, Sec. 924(a), (b), Nov. 14, 1986, 

100 Stat. 3853, 3932, 3933, renumbered title IX, Pub. L. 100–26, Sec. 3(5), Apr. 21, 1987, 101 

Stat. 273; Pub. L. 100–456, div. A, title VIII, Sec. 806, Sept. 29, 1988, 102 Stat. 2010; Pub. L. 

101–189, div. A, title VIII, Sec. 853(f), Nov. 29, 1989, 103 Stat. 1519; Pub. L. 101–510, div. A, 

title VIII, Sec. 802(a)–(d), Nov. 5, 1990, 104 Stat. 1588, 1589; Pub. L. 103–160, div. A, title XI, 

Sec. 1182(a)(5), Nov. 30, 1993, 107 Stat. 1771; Pub. L. 103–355, title I, Sec. 1011–1016, title 

IV, Sec. 4401(b), Oct. 13, 1994, 108 Stat. 3254–3257, 3347; Pub. L. 104–106, div. D, title XLI, 

Sec. 4103(a), 4104(a), title XLII, Sec. 4202(a)(2), div. E, title LVI, Sec. 5601(a), Feb. 10, 1996, 
1155 § 2305a CH. 137—PROCUREMENT GENERALLY 

110 Stat. 643, 644, 653, 699; Pub. L. 104–201, div. A, title VIII, Sec. 821(a), title X, Sec. 

1074(a)(11), (b)(4)(A), Sept. 23, 1996, 110 Stat. 2609, 2659, 2660; Pub. L. 106–65, div. A, title 

VIII, Sec. 821, Oct. 5, 1999, 113 Stat. 714.) 

§ 2305a. Design-build selection procedures 

(a) AUTHORIZATION.—Unless the traditional acquisition approach of design-bid-build established under chapter 11 of title 40 

is used or another acquisition procedure authorized by law is used, 

the head of an agency shall use the two-phase selection procedures 

authorized in this section for entering into a contract for the design 

and construction of a public building, facility, or work when a determination is made under subsection (b) that the procedures are 

appropriate for use. 

(b) CRITERIA FOR USE.—A contracting officer shall make a determination whether two-phase selection procedures are appropriate for use for entering into a contract for the design and construction of a public building, facility, or work when the contracting 

officer anticipates that three or more offers will be received for 

such contract, design work must be performed before an offeror can 

develop a price or cost proposal for such contract, the offeror will 

incur a substantial amount of expense in preparing the offer, and 

the contracting officer has considered information such as the following: 

(1) The extent to which the project requirements have been 

adequately defined. 

(2) The time constraints for delivery of the project. 

(3) The capability and experience of potential contractors. 

(4) The suitability of the project for use of the two-phase 

selection procedures. 

(5) The capability of the agency to manage the two-phase 

selection process. 

(6) Other criteria established by the agency. 

(c) PROCEDURES DESCRIBED.—Two-phase selection procedures 

consist of the following: 

(1) The agency develops, either in-house or by contract, a 

scope of work statement for inclusion in the solicitation that 

defines the project and provides prospective offerors with sufficient information regarding the Government’s requirements 

(which may include criteria and preliminary design, budget parameters, and schedule or delivery requirements) to enable the 

offerors to submit proposals which meet the Government’s 

needs. If the agency contracts for development of the scope of 

work statement, the agency shall contract for architectural and 

engineering services as defined by and in accordance with 

chapter 11 of title 40. 

(2) The contracting officer solicits phase-one proposals 

that— 

(A) include information on the offeror’s— 

(i) technical approach; and 

(ii) technical qualifications; and 

(B) do not include— 

(i) detailed design information; or 

(ii) cost or price information. 

(3) The evaluation factors to be used in evaluating phaseone proposals are stated in the solicitation and include special-
§ 2305a CH. 137—PROCUREMENT GENERALLY 1156 

ized experience and technical competence, capability to perform, past performance of the offeror’s team (including the architect-engineer and construction members of the team) and 

other appropriate factors, except that cost-related or price-related evaluation factors are not permitted. Each solicitation establishes the relative importance assigned to the evaluation 

factors and subfactors that must be considered in the evaluation of phase-one proposals. The agency evaluates phase-one 

proposals on the basis of the phase-one evaluation factors set 

forth in the solicitation. 

(4) The contracting officer selects as the most highly qualified the number of offerors specified in the solicitation to provide the property or services under the contract and requests 

the selected offerors to submit phase-two competitive proposals 

that include technical proposals and cost or price information. 

Each solicitation establishes with respect to phase two— 

(A) the technical submission for the proposal, including design concepts or proposed solutions to requirements 

addressed within the scope of work (or both), and 

(B) the evaluation factors and subfactors, including 

cost or price, that must be considered in the evaluations of 

proposals in accordance with paragraphs (2), (3), and (4) of 

section 2305(a) of this title. 

The contracting officer separately evaluates the submissions 

described in subparagraphs (A) and (B). 

(5) The agency awards the contract in accordance with section 2305(b)(4) of this title. 

(d) SOLICITATION TO STATE NUMBER OF OFFERORS TO BE SE- LECTED FOR PHASE TWO REQUESTS FOR COMPETITIVE PROPOSALS.— 

A solicitation issued pursuant to the procedures described in subsection (c) shall state the maximum number of offerors that are to 

be selected to submit competitive proposals pursuant to subsection 

(c)(4). The maximum number specified in the solicitation shall not 

exceed 5 unless the agency determines with respect to an individual solicitation that a specified number greater than 5 is in the 

Government’s interest and is consistent with the purposes and objectives of the two-phase selection process. 

(e) REQUIREMENT FOR GUIDANCE AND REGULATIONS.—The Federal Acquisition Regulation shall include guidance— 

(1) regarding the factors that may be considered in determining whether the two-phase contracting procedures authorized by subsection (a) are appropriate for use in individual contracting situations; 

(2) regarding the factors that may be used in selecting contractors; and 

(3) providing for a uniform approach to be used Government-wide. 

(f) SPECIAL AUTHORITY FOR MILITARY CONSTRUCTION

PROJECTS.—(1) The Secretary of a military department may use 

funds available to the Secretary under section 2807(a) or 18233(e) 

of this title to accelerate the design effort in connection with a military construction project for which the two-phase selection procedures described in subsection (c) are used to select the contractor 

for both the design and construction portion of the project before 
1157 § 2306 CH. 137—PROCUREMENT GENERALLY 

the project is specifically authorized by law and before funds are 

appropriated for the construction portion of the project. Notwithstanding the limitations contained in such sections, use of such 

funds for the design portion of a military construction project may 

continue despite the subsequent authorization of the project. The 

advance notice requirement of section 2807(b) of this title shall continue to apply whenever the estimated cost of the design portion 

of the project exceeds the amount specified in such section. 

(2) Any military construction contract that provides for an accelerated design effort, as authorized by paragraph (1), shall include as a condition of the contract that the liability of the United 

States in a termination for convenience before funds are first made 

available for construction may not exceed an amount attributable 

to the final design of the project. 

(3) For each fiscal year during which the authority provided by 

this subsection is in effect, the Secretary of a military department 

may select not more than two military construction projects to include the accelerated design effort authorized by paragraph (1) for 

each armed force under the jurisdiction of the Secretary. To be eligible for selection under this subsection, a request for the authorization of the project, and for the authorization of appropriations 

for the project, must have been included in the annual budget of 

the President for a fiscal year submitted to Congress under section 

1105(a) of title 31. 

(4) Not later than March 1, 2008, the Secretary of Defense 

shall submit to the congressional defense committees a report evaluating the usefulness of the authority provided by this subsection 

in expediting the design and construction of military construction 

projects. The authority provided by this subsection expires September 30, 2008, except that, if the report required by this paragraph is not submitted by March 1, 2008, the authority shall expire 

on that date. 

(Added Pub. L. 104–106, div. D, title XLI, Sec. 4105(a)(1), Feb. 10, 1996, 110 Stat. 645; Pub. 

L. 105–85, div. A, title X, Sec. 1073(a)(44), Nov. 18, 1997, 111 Stat. 1902; Pub. L. 107–217, Sec. 

3(b)(4), Aug. 21, 2002, 116 Stat. 1295; Pub. L. 108–178, Sec. 4(b)(3), Dec. 15, 2003, 117 Stat. 

2641; Pub. L. 108–375, div. B, title XXVIII, Sec. 2807, Oct. 28, 2004, 118 Stat. 2123; Pub. L. 

109–163, div. B, title XXVIII, Sec. 2807, Jan. 6, 2006, 119 Stat. 3508.) 

§ 2306. Kinds of contracts 

(a) The cost-plus-a-percentage-of-cost system of contracting 

may not be used. Subject to the limitation in the preceding sentence, the other provisions of this section, and other applicable provisions of law, the head of an agency, in awarding contracts under 

this chapter after using procedures other than sealed-bid procedures, may enter into any kind of contract that he considers will 

promote the best interests of the United States. 

(b) Each contract awarded under this chapter after using procedures other than sealed-bid procedures shall contain a warranty, 

determined to be suitable by the head of the agency, that the contractor has employed or retained no person or selling agency to solicit or obtain the contract under an understanding or agreement 

for a commission, percentage, brokerage, or contingent fee, except 

a bona fide employee or established commercial or selling agency 

maintained by him to obtain business. If a contractor breaks such 

a warranty the United States may annul the contract without li-
§ 2306a CH. 137—PROCUREMENT GENERALLY 1158 

ability or may deduct the commission, percentage, brokerage, or 

contingent fee from the contract price or consideration. This subsection does not apply to a contract that is for an amount not 

greater than the simplified acquisition threshold or to a contract 

for the acquisition of commercial items. 

[(c) Repealed. Pub. L. 103–355, title I, Sec. 1021, Oct. 13, 1994, 

108 Stat. 3257.] 

(d) The fee for performing a cost-plus-a-fixed-fee contract for 

experimental, developmental, or research work may not be more 

than 15 percent of the estimated cost of the contract, not including 

the fee. The fee for performing a cost-plus-a-fixed-fee contract for 

architectural or engineering services for a public work or utility 

plus the cost of those services to the contractor may not be more 

than 6 percent of the estimated cost of that work or project, not including fees. The fee for performing any other cost-plus-a-fixed-fee 

contract may not be more than 10 percent of the estimated cost of 

the contract, not including the fee. Determinations under this subsection of the estimated costs of a contract or project shall be made 

by the head of the agency at the time the contract is made. 

(e)(1) Except as provided in paragraph (2), each cost contract 

and each cost-plus-a-fixed-fee contract shall provide for notice to 

the agency by the contractor before the making, under the prime 

contract, of— 

(A) a cost-plus-a-fixed-fee subcontract; or 

(B) a fixed-price subcontract or purchase order involving 

more than the greater of (i) the simplified acquisition threshold, or (ii) 5 percent of the estimated cost of the prime contract. 

(2) Paragraph (1) shall not apply to a prime contract with a 

contractor that maintains a purchasing system approved by the 

contracting officer for the contract. 

(f) So-called ‘‘truth-in-negotiations’’ provisions relating to cost 

or pricing data to be submitted by certain contractors and subcontractors are provided in section 2306a of this title. 

(g) Multiyear contracting authority for the acquisition of services is provided in section 2306c of this title. 

(h) Multiyear contracting authority for the purchase of property is provided in section 2306b of this title. 

(Aug. 10, 1956, ch. 1041, 70A Stat. 130; Pub. L. 87–653, Sec. 1(d), (e), Sept. 10, 1962, 76 Stat. 

528; Pub. L. 90–378, Sec. 1, July 5, 1968, 82 Stat. 289; Pub. L. 90–512, Sept. 25, 1968, 82 Stat. 

863; Pub. L. 96–513, title V, Sec. 511(77), Dec. 12, 1980, 94 Stat. 2926; Pub. L. 97–86, title IX, 

Secs. 907(b), 909(b), Dec. 1, 1981, 95 Stat. 1117, 1118; Pub. L. 98–369, div. B, title VII, Sec. 

2724, July 18, 1984, 98 Stat. 1192; Pub. L. 99–145, title XIII, Sec. 1303(a)(15), Nov. 8, 1985, 

99 Stat. 739; Pub. L. 99–500, Sec. 101(c) [title X, Sec. 952(b)(1), (c)(1)], Oct. 18, 1986, 100 Stat. 

1783–82, 1783–169, and Pub. L. 99–591, Sec. 101(c) [title X, Sec. 952(b)(1), (c)(1)], Oct. 30, 1986, 

100 Stat. 3341–82, 3341–169; Pub. L. 99–661, div. A, title IX, formerly title IV, Sec. 952(b)(1), 

(c)(1), Nov. 14, 1986, 100 Stat. 3949, renumbered title IX, Pub. L. 100–26, Sec. 3(5), Apr. 21, 

1987, 101 Stat. 273; Pub. L. 101–189, div. A, title VIII, Sec. 805(a), Nov. 29, 1989, 103 Stat. 

1488; Pub. L. 101–510, div. A, title VIII, Sec. 808, Nov. 5, 1990, 104 Stat. 1593; Pub. L. 102– 

25, title VII, Sec. 701(d)(3), Apr. 6, 1991, 105 Stat. 114; Pub. L. 103–355, title I, Secs. 1021, 

1022(b), title IV, Secs. 4102(b), 4401(c), title VIII, Sec. 8105(a), Oct. 13, 1994, 108 Stat. 3257, 

3260, 3340, 3348, 3392; Pub. L. 105–85, div. A, title X, Sec. 1073(a)(45), Nov. 18, 1997, 111 Stat. 

1902; Pub. L. 106–398, Sec. 1 [[div. A], title VIII, Sec. 802(b)], Oct. 30, 2000, 114 Stat. 1654, 

1654A–205; Pub. L. 108–136, div. A, title VIII, Sec. 842, Nov. 24, 2003, 117 Stat. 1552.) 

§ 2306a. Cost or pricing data: truth in negotiations 

(a) REQUIRED COST OR PRICING DATA AND CERTIFICATION.—(1) 

The head of an agency shall require offerors, contractors, and subcontractors to make cost or pricing data available as follows: 
1159 § 2306a CH. 137—PROCUREMENT GENERALLY 

(A) An offeror for a prime contract under this chapter to 

be entered into using procedures other than sealed-bid procedures shall be required to submit cost or pricing data before 

the award of a contract if— 

(i) in the case of a prime contract entered into after 

December 5, 1990, the price of the contract to the United 

States is expected to exceed $500,000; and 

(ii) in the case of a prime contract entered into on or 

before December 5, 1990, the price of the contract to the 

United States is expected to exceed $100,000. 

(B) The contractor for a prime contract under this chapter 

shall be required to submit cost or pricing data before the pricing of a change or modification to the contract if— 

(i) in the case of a change or modification made to a 

prime contract referred to in subparagraph (A)(i), the price 

adjustment is expected to exceed $500,000; 

(ii) in the case of a change or modification made after 

December 5, 1991, to a prime contract that was entered 

into on or before December 5, 1990, and that has been 

modified pursuant to paragraph (6), the price adjustment 

is expected to exceed $500,000; and 

(iii) in the case of a change or modification not covered 

by clause (i) or (ii), the price adjustment is expected to exceed $100,000. 

(C) An offeror for a subcontract (at any tier) of a contract 

under this chapter shall be required to submit cost or pricing 

data before the award of the subcontract if the prime contractor and each higher-tier subcontractor have been required 

to make available cost or pricing data under this section and— 

(i) in the case of a subcontract under a prime contract 

referred to in subparagraph (A)(i), the price of the subcontract is expected to exceed $500,000; 

(ii) in the case of a subcontract entered into after December 5, 1991, under a prime contract that was entered 

into on or before December 5, 1990, and that has been 

modified pursuant to paragraph (6), the price of the subcontract is expected to exceed $500,000; and 

(iii) in the case of a subcontract not covered by clause 

(i) or (ii), the price of the subcontract is expected to exceed 

$100,000. 

(D) The subcontractor for a subcontract covered by subparagraph (C) shall be required to submit cost or pricing data 

before the pricing of a change or modification to the subcontract if— 

(i) in the case of a change or modification to a subcontract referred to in subparagraph (C)(i) or (C)(ii), the 

price adjustment is expected to exceed $500,000; and 

(ii) in the case of a change or modification to a subcontract referred to in subparagraph (C)(iii), the price adjustment is expected to exceed $100,000. 

(2) A person required, as an offeror, contractor, or subcontractor, to submit cost or pricing data under paragraph (1) (or required by the head of the agency concerned to submit such data 

under subsection (c)) shall be required to certify that, to the best 
§ 2306a CH. 137—PROCUREMENT GENERALLY 1160 

of the person’s knowledge and belief, the cost or pricing data submitted are accurate, complete, and current. 

(3) Cost or pricing data required to be submitted under paragraph (1) (or under subsection (c)), and a certification required to 

be submitted under paragraph (2), shall be submitted— 

(A) in the case of a submission by a prime contractor (or 

an offeror for a prime contract), to the contracting officer for 

the contract (or to a designated representative of the contracting officer); or 

(B) in the case of a submission by a subcontractor (or an 

offeror for a subcontract), to the prime contractor. 

(4) Except as provided under subsection (b), this section applies 

to contracts entered into by the head of an agency on behalf of a 

foreign government. 

(5) A waiver of requirements for submission of certified cost or 

pricing data that is granted under subsection (b)(1)(C) in the case 

of a contract or subcontract does not waive the requirement under 

paragraph (1)(C) for submission of cost or pricing data in the case 

of subcontracts under that contract or subcontract unless the head 

of the procuring activity granting the waiver determines that the 

requirement under that paragraph should be waived in the case of 

such subcontracts and justifies in writing the reasons for the determination. 

(6) Upon the request of a contractor that was required to submit cost or pricing data under paragraph (1) in connection with a 

prime contract entered into on or before December 5, 1990, the 

head of the agency that entered into such contract shall modify the 

contract to reflect subparagraphs (B)(ii) and (C)(ii) of paragraph (1). 

All such modifications shall be made without requiring consideration. 

(7) Effective on October 1 of each year that is divisible by 5, 

each amount set forth in paragraph (1) shall be adjusted to the 

amount that is equal to the fiscal year 1994 constant dollar value 

of the amount set forth. Any amount, as so adjusted, that is not 

evenly divisible by $50,000 shall be rounded to the nearest multiple 

of $50,000. In the case of an amount that is evenly divisible by 

$25,000 but not evenly divisible by $50,000, the amount shall be 

rounded to the next higher multiple of $50,000. 

(b) EXCEPTIONS.— 

(1) IN GENERAL.—Submission of certified cost or pricing 

data shall not be required under subsection (a) in the case of 

a contract, a subcontract, or modification of a contract or subcontract— 

(A) for which the price agreed upon is based on— 

(i) adequate price competition; or 

(ii) prices set by law or regulation; 

(B) for the acquisition of a commercial item; or 

(C) in an exceptional case when the head of the procuring activity, without delegation, determines that the requirements of this section may be waived and justifies in 

writing the reasons for such determination. 

(2) MODIFICATIONS OF CONTRACTS AND SUBCONTRACTS FOR

COMMERCIAL ITEMS.—In the case of a modification of a contract 

or subcontract for a commercial item that is not covered by the 
1161 § 2306a CH. 137—PROCUREMENT GENERALLY 

3 In subsection (b)(3)(B), ‘‘section 4(12)(C)(i) of the Office of Federal Procurement Policy Act 

(41 U.S.C. 403(12)(C)(i))’’ should be ‘‘section 103(3)(A) of title 41’’. 

exception to the submission of certified cost or pricing data in 

paragraph (1)(A) or (1)(B), submission of certified cost or pricing data shall not be required under subsection (a) if— 

(A) the contract or subcontract being modified is a contract or subcontract for which submission of certified cost 

or pricing data may not be required by reason of paragraph (1)(A) or (1)(B); and 

(B) the modification would not change the contract or 

subcontract, as the case may be, from a contract or subcontract for the acquisition of a commercial item to a contract or subcontract for the acquisition of an item other 

than a commercial item. 

(3) NONCOMMERCIAL MODIFICATIONS OF COMMERCIAL

ITEMS.—(A) The exception in paragraph (1)(B) does not apply 

to cost or pricing data on noncommercial modifications of a 

commercial item that are expected to cost, in the aggregate, 

more than the amount specified in subsection (a)(1)(A)(i), as 

adjusted from time to time under subsection (a)(7), or 5 percent 

of the total price of the contract (at the time of contract 

award), whichever is greater. 

(B) In this paragraph, the term ‘‘noncommercial modification’’, with respect to a commercial item, means a modification 

of such item that is not a modification described in section 

4(12)(C)(i) of the Office of Federal Procurement Policy Act (41 

U.S.C. 403(12)(C)(i)) 3. 

(C) Nothing in subparagraph (A) shall be construed— 

(i) to limit the applicability of the exception in subparagraph (A) or (C) of paragraph (1) to cost or pricing 

data on a noncommercial modification of a commercial 

item; or 

(ii) to require the submission of cost or pricing data on 

any aspect of an acquisition of a commercial item other 

than the cost and pricing of noncommercial modifications 

of such item. 

(c) COST OR PRICING DATA ON BELOW-THRESHOLD CONTRACTS.— 

(1) AUTHORITY TO REQUIRE SUBMISSION.—Subject to paragraph (2), when certified cost or pricing data are not required 

to be submitted by subsection (a) for a contract, subcontract, 

or modification of a contract or subcontract, such data may 

nevertheless be required to be submitted by the head of the 

procuring activity, but only if the head of the procuring activity 

determines that such data are necessary for the evaluation by 

the agency of the reasonableness of the price of the contract, 

subcontract, or modification of a contract or subcontract. In 

any case in which the head of the procuring activity requires 

such data to be submitted under this subsection, the head of 

the procuring activity shall justify in writing the reason for 

such requirement. 

(2) EXCEPTION.—The head of the procuring activity may 

not require certified cost or pricing data to be submitted under 
§ 2306a CH. 137—PROCUREMENT GENERALLY 1162 

this paragraph for any contract or subcontract, or modification 

of a contract or subcontract, covered by the exceptions in subparagraph (A) or (B) of subsection (b)(1). 

(3) DELEGATION OF AUTHORITY PROHIBITED.—The head of a 

procuring activity may not delegate functions under this paragraph. 

(d) SUBMISSION OF OTHER INFORMATION.— 

(1) AUTHORITY TO REQUIRE SUBMISSION.—When certified 

cost or pricing data are not required to be submitted under this 

section for a contract, subcontract, or modification of a contract 

or subcontract, the contracting officer shall require submission 

of data other than certified cost or pricing data to the extent 

necessary to determine the reasonableness of the price of the 

contract, subcontract, or modification of the contract or subcontract. Except in the case of a contract or subcontract covered by the exceptions in subsection (b)(1)(A), the contracting 

officer shall require that the data submitted include, at a minimum, appropriate information on the prices at which the same 

item or similar items have previously been sold that is adequate for evaluating the reasonableness of the price for the 

procurement. 

(2) LIMITATIONS ON AUTHORITY.—The Federal Acquisition 

Regulation shall include the following provisions regarding the 

types of information that contracting officers may require 

under paragraph (1): 

(A) Reasonable limitations on requests for sales data 

relating to commercial items. 

(B) A requirement that a contracting officer limit, to 

the maximum extent practicable, the scope of any request 

for information relating to commercial items from an offeror to only that information that is in the form regularly 

maintained by the offeror in commercial operations. 

(C) A statement that any information received relating 

to commercial items that is exempt from disclosure under 

section 552(b) of title 5 shall not be disclosed by the Federal Government. 

(e) PRICE REDUCTIONS FOR DEFECTIVE COST OR PRICING

DATA.—(1)(A) A prime contract (or change or modification to a 

prime contract) under which a certificate under subsection (a)(2) is 

required shall contain a provision that the price of the contract to 

the United States, including profit or fee, shall be adjusted to exclude any significant amount by which it may be determined by the 

head of the agency that such price was increased because the contractor (or any subcontractor required to make available such a certificate) submitted defective cost or pricing data. 

(B) For the purposes of this section, defective cost or pricing 

data are cost or pricing data which, as of the date of agreement on 

the price of the contract (or another date agreed upon between the 

parties), were inaccurate, incomplete, or noncurrent. If for purposes 

of the preceding sentence the parties agree upon a date other than 

the date of agreement on the price of the contract, the date agreed 

upon by the parties shall be as close to the date of agreement on 

the price of the contract as is practicable. 
1163 § 2306a CH. 137—PROCUREMENT GENERALLY 

(2) In determining for purposes of a contract price adjustment 

under a contract provision required by paragraph (1) whether, and 

to what extent, a contract price was increased because the contractor (or a subcontractor) submitted defective cost or pricing data, 

it shall be a defense that the United States did not rely on the defective data submitted by the contractor or subcontractor. 

(3) It is not a defense to an adjustment of the price of a contract under a contract provision required by paragraph (1) that— 

(A) the price of the contract would not have been modified 

even if accurate, complete, and current cost or pricing data had 

been submitted by the contractor or subcontractor because the 

contractor or subcontractor— 

(i) was the sole source of the property or services procured; or 

(ii) otherwise was in a superior bargaining position 

with respect to the property or services procured; 

(B) the contracting officer should have known that the cost 

and pricing data in issue were defective even though the contractor or subcontractor took no affirmative action to bring the 

character of the data to the attention of the contracting officer; 

(C) the contract was based on an agreement between the 

contractor and the United States about the total cost of the 

contract and there was no agreement about the cost of each 

item procured under such contract; or 

(D) the prime contractor or subcontractor did not submit 

a certification of cost and pricing data relating to the contract 

as required under subsection (a)(2). 

(4)(A) A contractor shall be allowed to offset an amount against 

the amount of a contract price adjustment under a contract provision required by paragraph (1) if— 

(i) the contractor certifies to the contracting officer (or to 

a designated representative of the contracting officer) that, to 

the best of the contractor’s knowledge and belief, the contractor 

is entitled to the offset; and 

(ii) the contractor proves that the cost or pricing data were 

available before the date of agreement on the price of the contract (or price of the modification) or, if applicable consistent 

with paragraph (1)(B), another date agreed upon between the 

parties, and that the data were not submitted as specified in 

subsection (a)(3) before such date. 

(B) A contractor shall not be allowed to offset an amount otherwise authorized to be offset under subparagraph (A) if— 

(i) the certification under subsection (a)(2) with respect to 

the cost or pricing data involved was known to be false when 

signed; or 

(ii) the United States proves that, had the cost or pricing 

data referred to in subparagraph (A)(ii) been submitted to the 

United States before the date of agreement on the price of the 

contract (or price of the modification) or, if applicable consistent with paragraph (1)(B), another date agreed upon between the parties, the submission of such cost or pricing data 

would not have resulted in an increase in that price in the 

amount to be offset. 
§ 2306a CH. 137—PROCUREMENT GENERALLY 1164 

(f) INTEREST AND PENALTIES FOR CERTAIN OVERPAYMENTS.—(1) 

If the United States makes an overpayment to a contractor under 

a contract subject to this section and the overpayment was due to 

the submission by the contractor of defective cost or pricing data, 

the contractor shall be liable to the United States— 

(A) for interest on the amount of such overpayment, to be 

computed— 

(i) for the period beginning on the date the overpayment was made to the contractor and ending on the date 

the contractor repays the amount of such overpayment to 

the United States; and 

(ii) at the current rate prescribed by the Secretary of 

the Treasury under section 6621 of the Internal Revenue 

Code of 1986; and 

(B) if the submission of such defective data was a knowing 

submission, for an additional amount equal to the amount of 

the overpayment. 

(2) Any liability under this subsection of a contractor that submits cost or pricing data but refuses to submit the certification required by subsection (a)(2) with respect to the cost or pricing data 

shall not be affected by the refusal to submit such certification. 

(g) RIGHT OF UNITED STATES TO EXAMINE CONTRACTOR

RECORDS.—For the purpose of evaluating the accuracy, completeness, and currency of cost or pricing data required to be submitted 

by this section, the head of an agency shall have the authority provided by section 2313(a)(2) of this title. 

(h) DEFINITIONS.—In this section: 

(1) COST OR PRICING DATA.—The term ‘‘cost or pricing 

data’’ means all facts that, as of the date of agreement on the 

price of a contract (or the price of a contract modification), or, 

if applicable consistent with subsection (e)(1)(B), another date 

agreed upon between the parties, a prudent buyer or seller 

would reasonably expect to affect price negotiations significantly. Such term does not include information that is 

judgmental, but does include the factual information from 

which a judgment was derived. 

(2) SUBCONTRACT.—The term ‘‘subcontract’’ includes a 

transfer of commercial items between divisions, subsidiaries, or 

affiliates of a contractor or a subcontractor. 

(3) COMMERCIAL ITEM.—The term ‘‘commercial item’’ has 

the meaning provided such term in section 103 of title 41. 

(Added Pub. L. 99–500, Sec. 101(c) [title X, Sec. 952(a)], Oct. 18, 1986, 100 Stat. 1783–82, 1783– 

166, and Pub. L. 99–591, Sec. 101(c) [title X, Sec. 952(a)], Oct. 30, 1986, 100 Stat. 3341–82, 

3341–166; Pub. L. 99–661, div. A, title IX, formerly title IV, Sec. 952(a), Nov. 14, 1986, 100 Stat. 

3945, renumbered title IX, Pub. L. 100–26, Sec. 3(5), Apr. 21, 1987, 101 Stat. 273; amended Pub. 

L. 100–180, div. A, title VIII, Sec. 804(a), (b), Dec. 4, 1987, 101 Stat. 1125; Pub. L. 101–510, 

div. A, title VIII, Sec. 803(a)(1), (d), Nov. 5, 1990, 104 Stat. 1589, 1590; Pub. L. 102–25, title 

VII, Sec. 701(b), (f)(8), Apr. 6, 1991, 105 Stat. 113, 115; Pub. L. 102–190, div. A, title VIII, Sec. 

804(a)–(c)(1), title X, Sec. 1061(a)(9), Dec. 5, 1991, 105 Stat. 1415, 1416, 1472; Pub. L. 103–355, 

title I, Sec. 1201–1209, Oct. 13, 1994, 108 Stat. 3273–3277; Pub. L. 104–106, div. D, title XLII, 

Sec. 4201(a), title XLIII, Sec. 4321(a)(2), (b)(7), Feb. 10, 1996, 110 Stat. 649, 671, 672; Pub. L. 

104–201, div. A, title X, Sec. 1074(a)(12), Sept. 23, 1996, 110 Stat. 2659; Pub. L. 105–85, div. 

A, title X, Sec. 1073(a)(46), Nov. 18, 1997, 111 Stat. 1902; Pub. L. 105–261, div. A, title VIII, 

Secs. 805(a), 808(a), Oct. 17, 1998, 112 Stat. 2083, 2085; Pub. L. 108–375, div. A, title VIII, Sec. 

818(a), Oct. 28, 2004, 118 Stat. 2015; Pub. L. 110–181, div. A, title VIII, Sec. 814, Jan. 28, 2008, 

122 Stat. 222; Pub. L. 111–350, Sec. 5(b)(15), Jan. 4, 2011, 124 Stat. 3843.) 
1165 § 2306b CH. 137—PROCUREMENT GENERALLY 

§ 2306b. Multiyear contracts: acquisition of property 

(a) IN GENERAL.—To the extent that funds are otherwise available for obligation, the head of an agency may enter into multiyear 

contracts for the purchase of property whenever the head of that 

agency finds each of the following: 

(1) That the use of such a contract will result in substantial savings of the total anticipated costs of carrying out the 

program through annual contracts. 

(2) That the minimum need for the property to be purchased is expected to remain substantially unchanged during 

the contemplated contract period in terms of production rate, 

procurement rate, and total quantities. 

(3) That there is a reasonable expectation that throughout 

the contemplated contract period the head of the agency will 

request funding for the contract at the level required to avoid 

contract cancellation. 

(4) That there is a stable design for the property to be acquired and that the technical risks associated with such property are not excessive. 

(5) That the estimates of both the cost of the contract and 

the anticipated cost avoidance through the use of a multiyear 

contract are realistic. 

(6) In the case of a purchase by the Department of Defense, that the use of such a contract will promote the national 

security of the United States. 

(7) In the case of a contract in an amount equal to or 

greater than $500,000,000, that the conditions required by subparagraphs (C) through (F) of paragraph (1) of subsection (i) 

will be met, in accordance with the Secretary’s certification and 

determination under such subsection, by such contract. 

(b) REGULATIONS.—(1) Each official named in paragraph (2) 

shall prescribe acquisition regulations for the agency or agencies 

under the jurisdiction of such official to promote the use of 

multiyear contracting as authorized by subsection (a) in a manner 

that will allow the most efficient use of multiyear contracting. 

(2)(A) The Secretary of Defense shall prescribe the regulations 

applicable to the Department of Defense. 

(B) The Secretary of Homeland Security shall prescribe the 

regulations applicable to the Coast Guard, except that the regulations prescribed by the Secretary of Defense shall apply to the 

Coast Guard when it is operating as a service in the Navy. 

(C) The Administrator of the National Aeronautics and Space 

Administration shall prescribe the regulations applicable to the National Aeronautics and Space Administration. 

(c) CONTRACT CANCELLATIONS.—The regulations may provide 

for cancellation provisions in multiyear contracts to the extent that 

such provisions are necessary and in the best interests of the 

United States. The cancellation provisions may include consideration of both recurring and nonrecurring costs of the contractor associated with the production of the items to be delivered under the 

contract. 
§ 2306b CH. 137—PROCUREMENT GENERALLY 1166 

(d) PARTICIPATION BY SUBCONTRACTORS, VENDORS, AND SUPPLIERS.—In order to broaden the defense industrial base, the regulations shall provide that, to the extent practicable— 

(1) multiyear contracting under subsection (a) shall be 

used in such a manner as to seek, retain, and promote the use 

under such contracts of companies that are subcontractors, 

vendors, or suppliers; and 

(2) upon accrual of any payment or other benefit under 

such a multiyear contract to any subcontractor, vendor, or supplier company participating in such contract, such payment or 

benefit shall be delivered to such company in the most expeditious manner practicable. 

(e) PROTECTION OF EXISTING AUTHORITY.—The regulations 

shall provide that, to the extent practicable, the administration of 

this section, and of the regulations prescribed under this section, 

shall not be carried out in a manner to preclude or curtail the existing ability of an agency— 

(1) to provide for competition in the production of items to 

be delivered under such a contract; or 

(2) to provide for termination of a prime contract the performance of which is deficient with respect to cost, quality, or 

schedule. 

(f) CANCELLATION OR TERMINATION FOR INSUFFICIENT FUNDING.—In the event funds are not made available for the continuation of a contract made under this section into a subsequent fiscal 

year, the contract shall be canceled or terminated. The costs of cancellation or termination may be paid from— 

(1) appropriations originally available for the performance 

of the contract concerned; 

(2) appropriations currently available for procurement of 

the type of property concerned, and not otherwise obligated; or 

(3) funds appropriated for those payments. 

(g) CONTRACT CANCELLATION CEILINGS EXCEEDING

$100,000,000.— 

(1) Before any contract described in subsection (a) that 

contains a clause setting forth a cancellation ceiling in excess 

of $100,000,000 may be awarded, the head of the agency concerned shall give written notification of the proposed contract 

and of the proposed cancellation ceiling for that contract to the 

congressional defense committees, and such contract may not 

then be awarded until the end of a period of 30 days beginning 

on the date of such notification. 

(2) In the case of a contract described in subsection (a) 

with a cancellation ceiling described in paragraph (1), if the 

budget for the contract does not include proposed funding for 

the costs of contract cancellation up to the cancellation ceiling 

established in the contract, the head of the agency concerned 

shall, as part of the certification required by subsection 

(i)(1)(A), give written notification to the congressional defense 

committees of— 

(A) the cancellation ceiling amounts planned for each 

program year in the proposed multiyear procurement contract, together with the reasons for the amounts planned; 
1167 § 2306b CH. 137—PROCUREMENT GENERALLY 

(B) the extent to which costs of contract cancellation 

are not included in the budget for the contract; and 

(C) a financial risk assessment of not including budgeting for costs of contract cancellation. 

(h) DEFENSE ACQUISITIONS OF WEAPON SYSTEMS.—In the case 

of the Department of Defense, the authority under subsection (a) 

includes authority to enter into the following multiyear contracts in 

accordance with this section: 

(1) A multiyear contract for the purchase of a weapon system, items and services associated with a weapon system, and 

logistics support for a weapon system. 

(2) A multiyear contract for advance procurement of components, parts, and materials necessary to the manufacture of 

a weapon system, including a multiyear contract for such advance procurement that is entered into in order to achieve economic-lot purchases and more efficient production rates. 

(i) DEFENSE ACQUISITIONS SPECIFICALLY AUTHORIZED BY

LAW.—(1) A multiyear contract may not be entered into for any fiscal year under this section for a defense acquisition program that 

has been specifically authorized by law to be carried out using 

multiyear contract authority unless the Secretary of Defense certifies in writing by no later than March 1 of the year in which the 

Secretary requests legislative authority to enter into such contract 

that each of the following conditions is satisfied: 

(A) The Secretary has determined that each of the requirements in paragraphs (1) through (6) of subsection (a) will be 

met by such contract and has provided the basis for such determination to the congressional defense committees. 

(B) The Secretary’s determination under subparagraph (A) 

was made after the completion of a cost analysis performed by 

the Director of Cost Assessment and Program Analysis and 

such analysis supports the findings. 

(C) The system being acquired pursuant to such contract 

has not been determined to have experienced cost growth in 

excess of the critical cost growth threshold pursuant to section 

2433(d) of this title within 5 years prior to the date the Secretary anticipates such contract (or a contract for advance procurement entered into consistent with the authorization for 

such contract) will be awarded. 

(D) A sufficient number of end items of the system being 

acquired under such contract have been delivered at or within 

the most current estimates of the program acquisition unit cost 

or procurement unit cost for such system to determine that 

current estimates of such unit costs are realistic. 

(E) During the fiscal year in which such contract is to be 

awarded, sufficient funds will be available to perform the contract in such fiscal year, and the future-years defense program 

for such fiscal year will include the funding required to execute 

the program without cancellation. 

(F) The contract is a fixed price type contract. 

(G) The proposed multiyear contract provides for production at not less than minimum economic rates given the existing tooling and facilities. 
§ 2306b CH. 137—PROCUREMENT GENERALLY 1168 

(2) If for any fiscal year a multiyear contract to be entered into 

under this section is authorized by law for a particular procurement program and that authorization is subject to certain conditions established by law (including a condition as to cost savings 

to be achieved under the multiyear contract in comparison to specified other contracts) and if it appears (after negotiations with contractors) that such savings cannot be achieved, but that substantial 

savings could nevertheless be achieved through the use of a 

multiyear contract rather than specified other contracts, the President may submit to Congress a request for relief from the specified 

cost savings that must be achieved through multiyear contracting 

for that program. Any such request by the President shall include 

details about the request for a multiyear contract, including details 

about the negotiated contract terms and conditions. 

(3) In the case of the Department of Defense, a multiyear con- tract in an amount equal to or greater than $500,000,000 may not 

be entered into for any fiscal year under this section unless the 

contract is specifically authorized by law in an Act other than an 

appropriations Act. 

(4)(A) The Secretary of Defense may obligate funds for procurement of an end item under a multiyear contract for the purchase 

of property only for procurement of a complete and usable end 

item. 

(B) The Secretary of Defense may obligate funds appropriated 

for any fiscal year for advance procurement under a contract for 

the purchase of property only for the procurement of those longlead items necessary in order to meet a planned delivery schedule 

for complete major end items that are programmed under the contract to be acquired with funds appropriated for a subsequent fiscal 

year (including an economic order quantity of such long-lead items 

when authorized by law). 

(5) The Secretary may make the certification under paragraph 

(1) notwithstanding the fact that one or more of the conditions of 

such certification are not met if the Secretary determines that, due 

to exceptional circumstances, proceeding with a multiyear contract 

under this section is in the best interest of the Department of Defense and the Secretary provides the basis for such determination 

with the certification. 

(6) The Secretary of Defense may not delegate the authority to 

make the certification under paragraph (1) or the determination 

under paragraph (5) to an official below the level of Under Secretary of Defense for Acquisition, Technology, and Logistics. 

(7) The Secretary of Defense shall send a notification containing the findings of the agency head under subsection (a), and 

the basis for such findings, 30 days prior to the award of a 

multiyear contract for a defense acquisition program that has been 

specifically authorized by law. 

(j) DEFENSE CONTRACT OPTIONS FOR VARYING QUANTITIES.— 

The Secretary of Defense may instruct the Secretary of the military 

department concerned to incorporate into a proposed multiyear contract negotiated priced options for varying the quantities of end 

items to be procured over the period of the contract. 

(k) MULTIYEAR CONTRACT DEFINED.—For the purposes of this 

section, a multiyear contract is a contract for the purchase of prop-
1169 § 2306b CH. 137—PROCUREMENT GENERALLY 

erty for more than one, but not more than five, program years. 

Such a contract may provide that performance under the contract 

during the second and subsequent years of the contract is contingent upon the appropriation of funds and (if it does so provide) may 

provide for a cancellation payment to be made to the contractor if 

such appropriations are not made. 

(l) VARIOUS ADDITIONAL REQUIREMENTS WITH RESPECT TO

MULTIYEAR DEFENSE CONTRACTS.—(1)(A) The head of an agency 

may not initiate a contract described in subparagraph (B) unless 

the congressional defense committees are notified of the proposed 

contract at least 30 days in advance of the award of the proposed 

contract. 

(B) Subparagraph (A) applies to the following contracts: 

(i) A multiyear contract— 

(I) that employs economic order quantity procurement 

in excess of $20,000,000 in any one year of the contract; 

or 

(II) that includes an unfunded contingent liability in 

excess of $20,000,000. 

(ii) Any contract for advance procurement leading to a 

multiyear contract that employs economic order quantity procurement in excess of $20,000,000 in any one year. 

(2) The head of an agency may not initiate a multiyear contract for which the economic order quantity advance procurement 

is not funded at least to the limits of the Government’s liability. 

(3) The head of an agency may not initiate a multiyear procurement contract for any system (or component thereof) if the 

value of the multiyear contract would exceed $500,000,000 unless 

authority for the contract is specifically provided in an appropriations Act. 

(4) Not later than the date of the submission of the President’s 

budget request under section 1105 of title 31, the Secretary of Defense shall submit a report to the congressional defense committees 

each year, providing the following information with respect to each 

multiyear contract (and each extension of an existing multiyear 

contract) entered into, or planned to be entered into, by the head 

of an agency during the current or preceding year, shown for each 

year in the current future-years defense program and in the aggregate over the period of the current future-years defense program: 

(A) The amount of total obligational authority under the 

contract (or contract extension) and the percentage that such 

amount represents of— 

(i) the applicable procurement account; and 

(ii) the agency procurement total. 

(B) The amount of total obligational authority under all 

multiyear procurements of the agency concerned (determined 

without regard to the amount of the multiyear contract (or contract extension)) under multiyear contracts in effect at the time 

the report is submitted and the percentage that such amount 

represents of— 

(i) the applicable procurement account; and 

(ii) the agency procurement total. 
§ 2306b CH. 137—PROCUREMENT GENERALLY 1170 

(C) The amount equal to the sum of the amounts under 

subparagraphs (A) and (B), and the percentage that such 

amount represents of— 

(i) the applicable procurement account; and 

(ii) the agency procurement total. 

(D) The amount of total obligational authority under all 

Department of Defense multiyear procurements (determined 

without regard to the amount of the multiyear contract (or contract extension)), including any multiyear contract (or contract 

extension) that has been authorized by the Congress but not 

yet entered into, and the percentage that such amount represents of the procurement accounts of the Department of Defense treated in the aggregate. 

(5) The head of an agency may not enter into a multiyear contract (or extend an existing multiyear contract), the value of which 

would exceed $500,000,000 (when entered into or when extended, 

as the case may be), until the Secretary of Defense submits to the 

congressional defense committees a report containing the information described in paragraph (4) with respect to the contract (or contract extension). 

(6) The head of an agency may not terminate a multiyear procurement contract until 10 days after the date on which notice of 

the proposed termination is provided to the congressional defense 

committees. 

(7) The execution of multiyear contracting authority shall require the use of a present value analysis to determine lowest cost 

compared to an annual procurement. 

(8) This subsection does not apply to the National Aeronautics 

and Space Administration or to the Coast Guard. 

(9) In this subsection: 

(A) The term ‘‘applicable procurement account’’ means, 

with respect to a multiyear procurement contract (or contract 

extension), the appropriation account from which payments to 

execute the contract will be made. 

(B) The term ‘‘agency procurement total’’ means the procurement accounts of the agency entering into a multiyear procurement contract (or contract extension) treated in the aggregate. 

(m) INCREASED FUNDING AND REPROGRAMMING REQUESTS.— 

Any request for increased funding for the procurement of a major 

system under a multiyear contract authorized under this section 

shall be accompanied by an explanation of how the request for increased funding affects the determinations made by the Secretary 

under subsection (i). 

(Added Pub. L. 103–355, title I, Sec. 1022(a)(1), Oct. 13, 1994, 108 Stat. 3257; Pub. L. 104–106, 

div. A, title XV, Sec. 1502(a)(10), div. E, title LVI, Sec. 5601(b), Feb. 10, 1996, 110 Stat. 503, 

699; Pub. L. 105–85, div. A, title VIII, Sec. 806(a)(1) (b)(1), (c), title X, Sec. 1073(a)(47), (48)(A), 

Nov. 18, 1997, 111 Stat. 1834, 1835, 1903; Pub. L. 106–65, div. A, title VIII, Sec. 809, title X, 

Sec. 1067(1), Oct. 5, 1999, 113 Stat. 705, 774; Pub. L. 106–398, Sec. 1 [[div. A], title VIII, Secs. 

802(c), 806], Oct. 30, 2000, 114 Stat. 1654, 1654A–207; Pub. L. 107–296, title XVII, Sec. 

1704(b)(1), Nov. 25, 2002, 116 Stat. 2314; Pub. L. 107–314, div. A, title VIII, Sec. 820(a), Dec. 

2, 2002, 116 Stat. 2613; Pub. L. 108–136, div. A, title X, Sec. 1043(b)(10), Nov. 24, 2003, 117 

Stat. 1611; Pub. L. 108–375, div. A, title VIII, Sec. 814(a), title X, Sec. 1084(b)(2), Oct. 28, 2004, 

118 Stat. 2014, 2060; Pub. L. 110–181, div. A, title VIII, Sec. 811(a), Jan. 28, 2008, 122 Stat. 

217; Pub. L. 111–23, title I, Sec. 101(d)(2), May 22, 2009, 123 Stat. 1709.) 
1171 § 2306c CH. 137—PROCUREMENT GENERALLY 

§ 2306c. Multiyear contracts: acquisition of services 

(a) AUTHORITY.—Subject to subsections (d) and (e), the head of 

an agency may enter into contracts for periods of not more than 

five years for services described in subsection (b), and for items of 

supply related to such services, for which funds would otherwise be 

available for obligation only within the fiscal year for which appropriated whenever the head of the agency finds that— 

(1) there will be a continuing requirement for the services 

consonant with current plans for the proposed contract period; 

(2) the furnishing of such services will require a substantial initial investment in plant or equipment, or the incurrence 

of substantial contingent liabilities for the assembly, training, 

or transportation of a specialized work force; and 

(3) the use of such a contract will promote the best interests of the United States by encouraging effective competition 

and promoting economies in operation. 

(b) COVERED SERVICES.—The authority under subsection (a) 

applies to the following types of services: 

(1) Operation, maintenance, and support of facilities and 

installations. 

(2) Maintenance or modification of aircraft, ships, vehicles, 

and other highly complex military equipment. 

(3) Specialized training necessitating high quality instructor skills (for example, pilot and air crew members; foreign language training). 

(4) Base services (for example, ground maintenance; inplane refueling; bus transportation; refuse collection and disposal). 

(5) Environmental remediation services for— 

(A) an active military installation; 

(B) a military installation being closed or realigned 

under a base closure law; or 

(C) a site formerly used by the Department of Defense. 

(c) APPLICABLE PRINCIPLES.—In entering into multiyear contracts for services under the authority of this section, the head of 

the agency shall be guided by the following principles: 

(1) The portion of the cost of any plant or equipment amortized as a cost of contract performance should not exceed the 

ratio between the period of contract performance and the anticipated useful commercial life of such plant or equipment. 

Useful commercial life, for this purpose, means the commercial 

utility of the facilities rather than the physical life thereof, 

with due consideration given to such factors as location of facilities, specialized nature thereof, and obsolescence. 

(2) Consideration shall be given to the desirability of obtaining an option to renew the contract for a reasonable period 

not to exceed three years, at prices not to include charges for 

plant, equipment and other nonrecurring costs, already amortized. 

(3) Consideration shall be given to the desirability of reserving in the agency the right, upon payment of the 

unamortized portion of the cost of the plant or equipment, to 

take title thereto under appropriate circumstances. 
§ 2306c CH. 137—PROCUREMENT GENERALLY 1172 

(d) RESTRICTIONS APPLICABLE GENERALLY.—(1) The head of an 

agency may not initiate under this section a contract for services 

that includes an unfunded contingent liability in excess of 

$20,000,000 unless the congressional defense committees are notified of the proposed contract at least 30 days in advance of the 

award of the proposed contract. 

(2) The head of an agency may not initiate a multiyear contract for services under this section if the value of the multiyear 

contract would exceed $500,000,000 unless authority for the contract is specifically provided by law. 

(3) The head of an agency may not terminate a multiyear procurement contract for services until 10 days after the date on 

which notice of the proposed termination is provided to the congressional defense committees. 

(4) Before any contract described in subsection (a) that contains a clause setting forth a cancellation ceiling in excess of 

$100,000,000 may be awarded, the head of the agency concerned 

shall give written notification of the proposed contract and of the 

proposed cancellation ceiling for that contract to the congressional 

defense committees, and such contract may not then be awarded 

until the end of a period of 30 days beginning on the date of such 

notification. 

(5) In the case of a contract described in subsection (a) with a 

cancellation ceiling described in paragraph (4), if the budget for the 

contract does not include proposed funding for the costs of contract 

cancellation up to the cancellation ceiling established in the contract, the head of the agency concerned shall give written notification to the congressional defense committees of— 

(A) the cancellation ceiling amounts planned for each program year in the proposed multiyear procurement contract, together with the reasons for the amounts planned; 

(B) the extent to which costs of contract cancellation are 

not included in the budget for the contract; and 

(C) a financial risk assessment of not including budgeting 

for costs of contract cancellation. 

(e) CANCELLATION OR TERMINATION FOR INSUFFICIENT FUNDING

AFTER FIRST YEAR.—In the event that funds are not made available for the continuation of a multiyear contract for services into 

a subsequent fiscal year, the contract shall be canceled or terminated, and the costs of cancellation or termination may be paid 

from— 

(1) appropriations originally available for the performance 

of the contract concerned; 

(2) appropriations currently available for procurement of 

the type of services concerned, and not otherwise obligated; or 

(3) funds appropriated for those payments. 

(f) MULTIYEAR CONTRACT DEFINED.—For the purposes of this 

section, a multiyear contract is a contract for the purchase of services for more than one, but not more than five, program years. 

Such a contract may provide that performance under the contract 

during the second and subsequent years of the contract is contingent upon the appropriation of funds and (if it does so provide) may 

provide for a cancellation payment to be made to the contractor if 

such appropriations are not made. 
1173 § 2307 CH. 137—PROCUREMENT GENERALLY 

[(g) Repealed. Pub. L. 108–136, div. A, title VIII, Sec. 843(a), 

Nov. 24, 2003, 117 Stat. 1553.] 

(h) MILITARY INSTALLATION DEFINED.—In this section, the term 

‘‘military installation’’ has the meaning given such term in section 

2801(c)(4) of this title. 

(Added Pub. L. 106–398, Sec. 1 [[div. A], title VIII, Sec. 802(a)(1)], Oct. 30, 2000, 114 Stat. 1654, 

1654A–203; amended Pub. L. 107–314, div. A, title VIII, Secs. 811(a), 827, Dec. 2, 2002, 116 

Stat. 2608, 2617; Pub. L. 108–136, div. A, title VIII, Sec. 843(a), title X, Sec. 1043(c)(1), Nov. 

24, 2003, 117 Stat. 1553, 1611; Pub. L. 108–375, div. A, title VIII, Sec. 814(b), Oct. 28, 2004, 

118 Stat. 2014; Pub. L. 111–84, div. A, title X, Sec. 1073(a)(22), Oct. 28, 2009, 123 Stat. 2473.) 

§ 2307. Contract financing 

(a) PAYMENT AUTHORITY.—The head of any agency may— 

(1) make advance, partial, progress, or other payments 

under contracts for property or services made by the agency; 

and 

(2) insert in solicitations for procurement of property or 

services a provision limiting to small business concerns advance or progress payments. 

(b) PERFORMANCE-BASED PAYMENTS.—Whenever practicable, 

payments under subsection (a) shall be made on any of the following bases: 

(1) Performance measured by objective, quantifiable methods such as delivery of acceptable items, work measurement, 

or statistical process controls. 

(2) Accomplishment of events defined in the program management plan. 

(3) Other quantifiable measures of results. 

(c) PAYMENT AMOUNT.—Payments made under subsection (a) 

may not exceed the unpaid contract price. 

(d) SECURITY FOR ADVANCE PAYMENTS.—Advance payments 

made under subsection (a) may be made only if the contractor gives 

adequate security and after a determination by the head of the 

agency that to do so would be in the public interest. Such security 

may be in the form of a lien in favor of the United States on the 

property contracted for, on the balance in an account in which such 

payments are deposited, and on such of the property acquired for 

performance of the contract as the parties may agree. This lien is 

paramount to any other liens and is effective immediately upon the 

first advancement of funds without filing, notice, or any other action by the United States. 

(e) CONDITIONS FOR PROGRESS PAYMENTS.—(1) The Secretary 

of Defense shall ensure that any payment for work in progress (including materials, labor, and other items) under a defense contract 

that provides for such payments is commensurate with the work 

accomplished that meets standards established under the contract. 

The contractor shall provide such information and evidence as the 

Secretary of Defense determines necessary to permit the Secretary 

to carry out the preceding sentence. 

(2) The Secretary shall ensure that progress payments referred 

to in paragraph (1) are not made for more than 80 percent of the 

work accomplished under a defense contract so long as the Secretary has not made the contractual terms, specifications, and price 

definite. 
§ 2307 CH. 137—PROCUREMENT GENERALLY 1174 

(3) This subsection applies to any contract in an amount great- er than $25,000. 

(f) CONDITIONS FOR PAYMENTS FOR COMMERCIAL ITEMS.—(1) 

Payments under subsection (a) for commercial items may be made 

under such terms and conditions as the head of the agency determines are appropriate or customary in the commercial marketplace 

and are in the best interests of the United States. The head of the 

agency shall obtain adequate security for such payments. If the security is in the form of a lien in favor of the United States, such 

lien is paramount to all other liens and is effective immediately 

upon the first payment, without filing, notice, or other action by 

the United States. 

(2) Advance payments made under subsection (a) for commercial items may include payments, in a total amount of not more 

than 15 percent of the contract price, in advance of any performance of work under the contract. 

(3) The conditions of subsections (d) and (e) need not be applied 

if they would be inconsistent, as determined by the head of the 

agency, with commercial terms and conditions pursuant to paragraphs (1) and (2). 

(g) CERTAIN NAVY CONTRACTS.—(1) The Secretary of the Navy 

shall provide that the rate for progress payments on any contract 

awarded by the Secretary for repair, maintenance, or overhaul of 

a naval vessel shall be not less than— 

(A) 95 percent, in the case of a firm considered to be a 

small business; and 

(B) 90 percent, in the case of any other firm. 

(2) The Secretary of the Navy may advance to private salvage 

companies such funds as the Secretary considers necessary to provide for the immediate financing of salvage operations. Advances 

under this paragraph shall be made on terms that the Secretary 

considers adequate for the protection of the United States. 

(3) The Secretary of the Navy shall provide, in each contract 

for construction or conversion of a naval vessel, that, when partial, 

progress, or other payments are made under such contract, the 

United States is secured by a lien upon work in progress and on 

property acquired for performance of the contract on account of all 

payments so made. The lien is paramount to all other liens. 

(h) VESTING OF TITLE IN THE UNITED STATES.—If a contract 

paid by a method authorized under subsection (a)(1) provides for 

title to property to vest in the United States, the title to the property shall vest in accordance with the terms of the contract, regardless of any security interest in the property that is asserted before 

or after the contract is entered into. 

(i) ACTION IN CASE OF FRAUD.—(1) In any case in which the 

remedy coordination official of an agency finds that there is substantial evidence that the request of a contractor for advance, partial, or progress payment under a contract awarded by that agency 

is based on fraud, the remedy coordination official shall recommend 

that the head of the agency reduce or suspend further payments 

to such contractor. 

(2) The head of an agency receiving a recommendation under 

paragraph (1) in the case of a contractor’s request for payment 

under a contract shall determine whether there is substantial evi-
1175 § 2307 CH. 137—PROCUREMENT GENERALLY 

dence that the request is based on fraud. Upon making such a determination, the agency head may reduce or suspend further payments to the contractor under such contract. 

(3) The extent of any reduction or suspension of payments by 

the head of an agency under paragraph (2) on the basis of fraud 

shall be reasonably commensurate with the anticipated loss to the 

United States resulting from the fraud. 

(4) A written justification for each decision of the head of an 

agency whether to reduce or suspend payments under paragraph 

(2) and for each recommendation received by such agency head in 

connection with such decision shall be prepared and be retained in 

the files of such agency. 

(5) The head of an agency shall prescribe procedures to ensure 

that, before such agency head decides to reduce or suspend payments in the case of a contractor under paragraph (2), the contractor is afforded notice of the proposed reduction or suspension 

and an opportunity to submit matters to the head of the agency in 

response to such proposed reduction or suspension. 

(6) Not later than 180 days after the date on which the head 

of an agency reduces or suspends payments to a contractor under 

paragraph (2), the remedy coordination official of such agency 

shall— 

(A) review the determination of fraud on which the reduction or suspension is based; and 

(B) transmit a recommendation to the head of such agency 

whether the suspension or reduction should continue. 

(7) The head of an agency shall prepare for each year a report 

containing the recommendations made by the remedy coordination 

official of that agency to reduce or suspend payments under paragraph (2), the actions taken on the recommendations and the reasons for such actions, and an assessment of the effects of such actions on the Federal Government. The Secretary of each military 

department shall transmit the annual report of such department to 

the Secretary of Defense. Each such report shall be available to any 

member of Congress upon request. 

(8) This subsection applies to the agencies named in paragraphs (1), (2), (3), (4), and (6) of section 2303(a) of this title. 

(9) The head of an agency may not delegate responsibilities 

under this subsection to any person in a position below level IV of 

the Executive Schedule. 

(10) In this subsection, the term ‘‘remedy coordination official’’, 

with respect to an agency, means the person or entity in that agency who coordinates within that agency the administration of criminal, civil, administrative, and contractual remedies resulting from 

investigations of fraud or corruption related to procurement activities. 

(Aug. 10, 1956, ch. 1041, 70A Stat. 131; Pub. L. 85–800, Sec. 9, Aug. 28, 1958, 72 Stat. 967; 

Pub. L. 93–155, title VIII, Sec. 807(c), Nov. 16, 1973, 87 Stat. 616; Pub. L. 100–370, Sec. 

1(f)(1)(A), July 19, 1988, 102 Stat. 846; Pub. L. 101–510, div. A, title VIII, Sec. 836(a), (b), title 

XIII, Sec. 1322(a)(4), Nov. 5, 1990, 104 Stat. 1615, 1616, 1671; Pub. L. 102–25, title VII, Sec. 

701(d)(4), (j)(2)(A), Apr. 6, 1991, 105 Stat. 114, 116; Pub. L. 102–190, div. A, title X, Sec. 

1061(a)(10), Dec. 5, 1991, 105 Stat. 1472; Pub. L. 102–484, div. A, title X, Sec. 1052(24), Oct. 

23, 1992, 106 Stat. 2500; Pub. L. 103–355, title II, Sec. 2001(a)–(g), Oct. 13, 1994, 108 Stat. 

3301, 3302; Pub. L. 105–85, div. A, title VIII, Sec. 802, Nov. 18, 1997, 111 Stat. 1831; Pub. L. 

106–391, title III, Sec. 306, Oct. 30, 2000, 114 Stat. 1592.) 
§ 2308 CH. 137—PROCUREMENT GENERALLY 1176 

§ 2308. Buy-to-budget acquisition: end items 

(a) AUTHORITY TO ACQUIRE ADDITIONAL END ITEMS.—Using 

funds available to the Department of Defense for the acquisition of 

an end item, the head of an agency making the acquisition may acquire a higher quantity of the end item than the quantity specified 

for the end item in a law providing for the funding of that acquisition if that head of an agency makes each of the following findings: 

(1) The agency has an established requirement for the end 

item that is expected to remain substantially unchanged 

throughout the period of the acquisition. 

(2) It is possible to acquire the higher quantity of the end 

item without additional funding because of production efficiencies or other cost reductions. 

(3) The amount of the funds used for the acquisition of the 

higher quantity of the end item will not exceed the amount 

provided under that law for the acquisition of the end item. 

(4) The amount so provided is sufficient to ensure that 

each unit of the end item acquired within the higher quantity 

is fully funded as a complete end item. 

(b) REGULATIONS.—The Secretary of Defense shall prescribe 

regulations for the administration of this section. The regulations 

shall include, at a minimum, the following: 

(1) The level of approval within the Department of Defense 

that is required for a decision to acquire a higher quantity of 

an end item under subsection (a). 

(2) Authority (subject to subsection (a)) to acquire up to 10 

percent more than the quantity of an end item approved in a 

justification and approval of the use of procedures other than 

competitive procedures for the acquisition of the end item 

under section 2304 of this title. 

(c) NOTIFICATION OF CONGRESS.—The head of an agency is not 

required to notify Congress in advance regarding a decision under 

the authority of this section to acquire a higher quantity of an end 

item than is specified in a law described in subsection (a), but shall 

notify the congressional defense committees of the decision not 

later than 30 days after the date of the decision. 

(d) WAIVER BY OTHER LAW.—A provision of law may not be 

construed as prohibiting the acquisition of a higher quantity of an 

end item under this section unless that provision of law— 

(1) specifically refers to this section; and 

(2) specifically states that the acquisition of the higher 

quantity of the end item is prohibited notwithstanding the authority provided in this section. 

(e) DEFINITIONS.—(1) For the purposes of this section, a quantity of an end item shall be considered specified in a law if the 

quantity is specified either in a provision of that law or in any related representation that is set forth separately in a table, chart, 

or explanatory text included in a joint explanatory statement or 

governing committee report accompanying the law. 

(2) In this section: 

(A) The term ‘‘end item’’ means a production product assembled, completed, and ready for issue or deployment. 
1177 § 2311 CH. 137—PROCUREMENT GENERALLY 

(B) The term ‘‘head of an agency’’ means the Secretary of 

Defense, the Secretary of the Army, the Secretary of the Navy, 

and the Secretary of the Air Force. 

(Added Pub. L. 107–314, div. A, title VIII, Sec. 801(a)(1), Dec. 2, 2002, 116 Stat. 2600; amended 

Pub. L. 108–136, div. A, title X, Sec. 1043(b)(11), Nov. 24, 2003, 117 Stat. 1611.) 

§ 2309. Allocation of appropriations 

(a) Appropriations available for procurement by an agency 

named in section 2303 of this title may, through administrative allotment, be made available for obligation for procurement by any 

other agency in amounts authorized by the head of the allotting 

agency and without transfer of funds on the books of the Department of the Treasury. 

(b) A disbursing official of the allotting agency may make any 

disbursement chargeable to an allotment under subsection (a) upon 

a voucher certified by an officer or civilian employee of the procuring agency. 

(Aug. 10, 1956, ch. 1041, 70A Stat. 132; Pub. L. 97–258, Sec. 2(b)(1)(B), Sept. 13, 1982, 96 Stat. 

1052.) 

§ 2310. Determinations and decisions 

(a) INDIVIDUAL OR CLASS DETERMINATIONS AND DECISIONS AUTHORIZED.—Determinations and decisions required to be made 

under this chapter by the head of an agency may be made for an 

individual purchase or contract or, except to the extent expressly 

prohibited by another provision of law, for a class of purchases or 

contracts. Such determinations and decisions are final. 

(b) WRITTEN FINDINGS REQUIRED.—(1) Each determination or 

decision under section 2306(g)(1), 2307(d), or 2313(c)(2)(B) of this 

title shall be based on a written finding by the person making the 

determination or decision. The finding shall set out facts and circumstances that support the determination or decision. 

(2) Each finding referred to in paragraph (1) is final. The head 

of the agency making such finding shall maintain a copy of the 

finding for not less than 6 years after the date of the determination 

or decision. 

(Aug. 10, 1956, ch. 1041, 70A Stat. 132; Pub. L. 85–800, Sec. 10, Aug. 28, 1958, 72 Stat. 967; 

Pub. L. 87–653, Sec. 1(f), Sept. 10, 1962, 76 Stat. 529; Pub. L. 89–607, Sec. 1(1), Sept. 27, 1966, 

80 Stat. 850; Pub. L. 90–378, Sec. 2, July 5, 1968, 82 Stat. 290; Pub. L. 98–369, div. B, title 

VII, Sec. 2725, July 18, 1984, 98 Stat. 1193; Pub. L. 99–145, title XIII, Sec. 1303(a)(16), Nov. 

8, 1985, 99 Stat. 739; Pub. L. 103–355, title I, Sec. 1504, Oct. 13, 1994, 108 Stat. 3297.) 

§ 2311. Assignment and delegation of procurement functions 

and responsibilities 

(a) IN GENERAL.—Except to the extent expressly prohibited by 

another provision of law, the head of an agency may delegate, subject to his direction, to any other officer or official of that agency, 

any power under this chapter. 

(b) PROCUREMENTS FOR OR WITH OTHER AGENCIES.—Subject to 

subsection (a), to facilitate the procurement of property and services covered by this chapter by each agency named in section 2303 

of this title for any other agency, and to facilitate joint procurement 

by those agencies— 
§ 2312 CH. 137—PROCUREMENT GENERALLY 1178 

(1) the head of an agency may delegate functions and assign responsibilities relating to procurement to any officer or 

employee within such agency; 

(2) the heads of two or more agencies may by agreement 

delegate procurement functions and assign procurement responsibilities from one agency to another of those agencies or 

to an officer or civilian employee of another of those agencies; 

and 

(3) the heads of two or more agencies may create joint or 

combined offices to exercise procurement functions and responsibilities. 

(c) APPROVAL OF TERMINATIONS AND REDUCTIONS OF JOINT ACQUISITION PROGRAMS.—(1) The Secretary of Defense shall prescribe 

regulations that prohibit each military department participating in 

a joint acquisition program approved by the Under Secretary of Defense for Acquisition, Technology, and Logistics from terminating 

or substantially reducing its participation in such program without 

the approval of the Under Secretary. 

(2) The regulations shall include the following provisions: 

(A) A requirement that, before any such termination or 

substantial reduction in participation is approved, the proposed 

termination or reduction be reviewed by the Joint Requirements Oversight Council of the Department of Defense. 

(B) A provision that authorizes the Under Secretary of Defense for Acquisition, Technology, and Logistics to require a 

military department whose participation in a joint acquisition 

program has been approved for termination or substantial reduction to continue to provide some or all of the funding necessary for the acquisition program to be continued in an efficient manner. 

(Aug. 10, 1956, ch. 1041, 70A Stat. 132; Aug. 28, 1958, Pub. L. 85–800, Sec. 11, 72 Stat. 967; 

Sept. 10, 1962, Pub. L. 87–653, Sec. 1(g), 76 Stat. 529; July 5, 1968, Pub. L. 90–378, Sec. 3, 

82 Stat. 290; Dec. 1, 1981, Pub. L. 97–86, title IX, Sec. 907(c), 909(f), 95 Stat. 1117, 1120; July 

18, 1984, Pub. L. 98–369, div. B, title VII, Sec. 2726, 98 Stat. 1194; Oct. 19, 1984, Pub. L. 98– 

525, title XII, Sec. 1214, 98 Stat. 2592; Oct. 30, 1984, Pub. L. 98–577, title V, Sec. 505, 98 Stat. 

3087; Oct. 13, 1994, Pub. L. 103–355, title I, Sec. 1503(a)(1), 108 Stat. 3296; Dec. 28, 2001, Pub. 

L. 107–107, div. A, title X, Sec. 1048(b)(2), 115 Stat. 1225.) 

§ 2312. Remission of liquidated damages 

Upon the recommendation of the head of an agency, the Secretary of the Treasury may remit all or part, as he considers just 

and equitable, of any liquidated damages assessed for delay in performing a contract, made by that agency, that provides for such 

damages. 

(Aug. 10, 1956, ch. 1041, 70A Stat. 132; Pub. L. 104–316, title II, Sec. 202(c), Oct. 19, 1996, 

110 Stat. 3842.) 

§ 2313. Examination of records of contractor 

(a) AGENCY AUTHORITY.—(1) The head of an agency, acting 

through an authorized representative, is authorized to inspect the 

plant and audit the records of— 

(A) a contractor performing a cost-reimbursement, incentive, time-and-materials, labor-hour, or price-redeterminable 

contract, or any combination of such contracts, made by that 

agency under this chapter; and 
1179 § 2313 CH. 137—PROCUREMENT GENERALLY 

(B) a subcontractor performing any cost-reimbursement, 

incentive, time-and-materials, labor-hour, or price-redeterminable subcontract or any combination of such subcontracts 

under a contract referred to in subparagraph (A). 

(2) The head of an agency, acting through an authorized representative, is authorized, for the purpose of evaluating the accuracy, completeness, and currency of certified cost or pricing data required to be submitted pursuant to section 2306a of this title with 

respect to a contract or subcontract, to examine all records of the 

contractor or subcontractor related to— 

(A) the proposal for the contract or subcontract; 

(B) the discussions conducted on the proposal; 

(C) pricing of the contract or subcontract; or 

(D) performance of the contract or subcontract. 

(b) DCAA SUBPOENA AUTHORITY.—(1) The Director of the Defense Contract Audit Agency (or any successor agency) may require 

by subpoena the production of any records of a contractor that the 

Secretary of Defense is authorized to audit or examine under subsection (a). 

(2) Any such subpoena, in the case of contumacy or refusal to 

obey, shall be enforceable by order of an appropriate United States 

district court. 

(3) The authority provided by paragraph (1) may not be redelegated. 

(c) COMPTROLLER GENERAL AUTHORITY.—(1) Except as provided in paragraph (2), each contract awarded after using procedures other than sealed bid procedures shall provide that the 

Comptroller General and his representatives are authorized to examine any records of the contractor, or any of its subcontractors, 

that directly pertain to, and involve transactions relating to, the 

contract or subcontract and to interview any current employee regarding such transactions. 

(2) Paragraph (1) does not apply to a contract or subcontract 

with a foreign contractor or foreign subcontractor if the head of the 

agency concerned determines, with the concurrence of the Comptroller General or his designee, that the application of that paragraph to the contract or subcontract would not be in the public interest. However, the concurrence of the Comptroller General or his 

designee is not required— 

(A) where the contractor or subcontractor is a foreign government or agency thereof or is precluded by the laws of the 

country involved from making its records available for examination; and 

(B) where the head of the agency determines, after taking 

into account the price and availability of the property and services from United States sources, that the public interest would 

be best served by not applying paragraph (1). 

(3) Paragraph (1) may not be construed to require a contractor 

or subcontractor to create or maintain any record that the contractor or subcontractor does not maintain in the ordinary course 

of business or pursuant to another provision of law. 

(d) LIMITATION ON AUDITS RELATING TO INDIRECT COSTS.—The 

head of an agency may not perform an audit of indirect costs under 

a contract, subcontract, or modification before or after entering into 
§ 2314 CH. 137—PROCUREMENT GENERALLY 1180 

the contract, subcontract, or modification in any case in which the 

contracting officer determines that the objectives of the audit can 

reasonably be met by accepting the results of an audit that was 

conducted by any other department or agency of the Federal Government within one year preceding the date of the contracting officer’s determination. 

(e) LIMITATION.—The authority of the head of an agency under 

subsection (a), and the authority of the Comptroller General under 

subsection (c), with respect to a contract or subcontract shall expire 

three years after final payment under such contract or subcontract. 

(f) INAPPLICABILITY TO CERTAIN CONTRACTS.—This section does 

not apply to the following contracts: 

(1) Contracts for utility services at rates not exceeding 

those established to apply uniformly to the public, plus any applicable reasonable connection charge. 

(2) A contract or subcontract that is for an amount not 

greater than the simplified acquisition threshold. 

(g) FORMS OF ORIGINAL RECORD STORAGE.—Nothing in this 

section shall be construed to preclude a contractor from duplicating 

or storing original records in electronic form. 

(h) USE OF IMAGES OF ORIGINAL RECORDS.—The head of an 

agency shall not require a contractor or subcontractor to provide 

original records in an audit carried out pursuant to this section if 

the contractor or subcontractor provides photographic or electronic 

images of the original records and meets the following requirements: 

(1) The contractor or subcontractor has established procedures to ensure that the imaging process preserves the integrity, reliability, and security of the original records. 

(2) The contractor or subcontractor maintains an effective 

indexing system to permit timely and convenient access to the 

imaged records. 

(3) The contractor or subcontractor retains the original 

records for a minimum of one year after imaging to permit 

periodic validation of the imaging systems. 

(i) RECORDS DEFINED.—In this section, the term ‘‘records’’ includes books, documents, accounting procedures and practices, and 

other data, regardless of type and regardless of whether such items 

are in written form, in the form of computer data, or in any other 

form. 

(Aug. 10, 1956, ch. 1041, 70A Stat. 132; Pub. L. 89–607, Sec. 1(2), Sept. 27, 1966, 80 Stat. 850; 

Pub. L. 98–369, div. B, title VII, Sec. 2727(c), July 18, 1984, 98 Stat. 1195; Pub. L. 99–145, title 

IX, Sec. 935, Nov. 8, 1985, 99 Stat. 700; Pub. L. 100–26, Sec. 7(g)(1), Apr. 21, 1987, 101 Stat. 

282; Pub. L. 101–510, div. A, title XIII, Sec. 1301(9), Nov. 5, 1990, 104 Stat. 1668; Pub. L. 103– 

355, title II, Sec. 2201(a)(1), title IV, Sec. 4102(c), Oct. 13, 1994, 108 Stat. 3316, 3340; Pub. L. 

104–106, div. A, title XV, Sec. 1502(a)(1), Feb. 10, 1996, 110 Stat. 502; Pub. L. 104–201, div. 

A, title VIII, Sec. 808(a), Sept. 23, 1996, 110 Stat. 2607; Pub. L. 106–65, div. A, title X, Sec. 

1032(a)(2), Oct. 5, 1999, 113 Stat. 751; Pub. L. 110–417, [div. A], title VIII, Sec. 871(b), Oct. 

14, 2008, 122 Stat. 4555.) 

§ 2314. Laws inapplicable to agencies named in section 2303 

of this title 

Sections 6101(b)–(d) and 6304 of title 41 do not apply to the 

procurement or sale of property or services by the agencies named 

in section 2303 of this title. 
1181 § 2319 CH. 137—PROCUREMENT GENERALLY 

(Aug. 10, 1956, ch. 1041, 70A Stat. 133; Pub. L. 96–513, title V, Sec. 511(78), Dec. 12, 1980, 

94 Stat. 2927; Pub. L. 103–160, div. A, title VIII, Sec. 822(b)(2), Nov. 30, 1993, 107 Stat. 1706; 

Pub. L. 111–350, Sec. 5(b)(16), Jan. 4, 2011, 124 Stat. 3843.) 

§ 2315. Law inapplicable to the procurement of automatic 

data processing equipment and services for certain 

defense purposes 

For purposes of subtitle III of title 40, the term ‘‘national security system’’, with respect to a telecommunications and information 

system operated by the Department of Defense, has the meaning 

given that term by section 3542(b)(2) of title 44. 

(Added Pub. L. 97–86, title IX, Sec. 908(a)(1), Dec. 1, 1981, 95 Stat. 1117; amended Pub. L. 97– 

295, Sec. 1(25), Oct. 12, 1982, 96 Stat. 1291; Pub. L. 104–106, div. E, title LVI, Sec. 5601(c), 

Feb. 10, 1996, 110 Stat. 699; Pub. L. 104–201, div. A, title X, Sec. 1074(b)(4)(B), Sept. 23, 1996, 

110 Stat. 2660; Pub. L. 105–85, div. A, title X, Sec. 1073(a)(49), Nov. 18, 1997, 111 Stat. 1903; 

Pub. L. 107–217, Sec. 3(b)(5), Aug. 21, 2002, 116 Stat. 1295; Pub. L. 109–364, div. A, title IX, 

Sec. 906(c), Oct. 17, 2006, 120 Stat. 2354.) 

§ 2316. Disclosure of identity of contractor 

The Secretary of Defense may disclose the identity or location 

of a person awarded a contract by the Department of Defense to 

any individual, including a Member of Congress, only after the Secretary makes a public announcement identifying the contractor. 

When the identity of a contractor is to be made public, the Secretary shall announce publicly that the contract has been awarded 

and the identity of the contractor. 

(Added Pub. L. 97–295, Sec. 1(26)(A), Oct. 12, 1982, 96 Stat. 1291.) 

[§ 2317. Repealed. Pub. L. 103–160, div. A, title VIII, Sec. 

821(a)(2), Nov. 30, 1993, 107 Stat. 1704] 

§ 2318. Advocates for competition 

(a)(1) In addition to the advocates for competition established 

or designated pursuant to section 1705(a) of title 41, the Secretary 

of Defense shall designate an officer or employee of the Defense Logistics Agency to serve as the advocate for competition of the agency. 

(2) The advocate for competition of the Defense Logistics Agency shall carry out the responsibilities and functions provided for in 

section 1705(b) and (c) of title 41. 

(b) Each advocate for competition of an agency named in section 2303(a) of this title shall be a general or flag officer if a member of the armed forces or a grade GS–16 or above under the General Schedule (or in a comparable or higher position under another 

schedule), if a civilian employee and shall be designated to serve 

for a minimum of two years. 

(Added Pub. L. 98–525, title XII, Sec. 1216(a), Oct. 19, 1984, 98 Stat. 2593; amended Pub. L. 

100–26, Sec. 7(d)(4), Apr. 21, 1987, 101 Stat. 281; Pub. L. 102–25, title VII, Sec. 701(f)(1), Apr. 

6, 1991, 105 Stat. 115; Pub. L. 103–355, title I, Sec. 1031, Oct. 13, 1994, 108 Stat. 3260; Pub. 

L. 111–350, Sec. 5(b)(17), Jan. 4, 2011, 124 Stat. 3843.) 

§ 2319. Encouragement of new competitors 

(a) In this section, the term ‘‘qualification requirement’’ means 

a requirement for testing or other quality assurance demonstration 

that must be completed by an offeror before award of a contract. 

(b) Except as provided in subsection (c), the head of the agency 

shall, before establishing a qualification requirement— 
§ 2319 CH. 137—PROCUREMENT GENERALLY 1182 

(1) prepare a written justification stating the necessity for 

establishing the qualification requirement and specify why the 

qualification requirement must be demonstrated before contract award; 

(2) specify in writing and make available to a potential offeror upon request all requirements which a prospective offeror, or its product, must satisfy in order to become qualified, 

such requirements to be limited to those least restrictive to 

meet the purposes necessitating the establishment of the qualification requirement; 

(3) specify an estimate of the costs of testing and evaluation likely to be incurred by a potential offeror in order to become qualified; 

(4) ensure that a potential offeror is provided, upon request and on a reimbursable basis, a prompt opportunity to 

demonstrate its ability to meet the standards specified for 

qualification using qualified personnel and facilities of the 

agency concerned or of another agency obtained through interagency agreement, or under contract, or other methods approved by the agency (including use of approved testing and 

evaluation services not provided under contract to the agency); 

(5) if testing and evaluation services are provided under 

contract to the agency for the purposes of clause (4), provide 

to the extent possible that such services be provided by a contractor who is not expected to benefit from an absence of additional qualified sources and who shall be required in such contract to adhere to any restriction on technical data asserted by 

the potential offeror seeking qualification; and 

(6) ensure that a potential offeror seeking qualification is 

promptly informed as to whether qualification is attained and, 

in the event qualification is not attained, is promptly furnished 

specific information why qualification was not attained. 

(c)(1) Subsection (b) of this section does not apply with respect 

to a qualification requirement established by statute or administrative action before October 19, 1984, unless such requirement is a 

qualified products list. 

(2)(A) Except as provided in subparagraph (B), if it is unreasonable to specify the standards for qualification which a prospective offeror or its product must satisfy, a determination to that effect shall be submitted to the advocate for competition of the procuring activity responsible for the purchase of the item subject to 

the qualification requirement. After considering any comments of 

the advocate for competition reviewing such determination, the 

head of the purchasing office may waive the requirements of 

clauses (2) through (6) of subsection (b) for up to two years with 

respect to the item subject to the qualification requirement. 

(B) The waiver authority provided in this paragraph does not 

apply with respect to a qualified products list. 

(3) A potential offeror may not be denied the opportunity to 

submit and have considered an offer for a contract solely because 

the potential offeror (A) is not on a qualified bidders list, qualified 

manufacturers list, or qualified products list, or (B) has not been 

identified as meeting a qualification requirement established after 

October 19, 1984, if the potential offeror can demonstrate to the 
1183 § 2319 CH. 137—PROCUREMENT GENERALLY 

satisfaction of the contracting officer (or, in the case of a contract 

for the procurement of an aviation critical safety item or ship critical safety item, the head of the design control activity for such 

item) that the potential offeror or its product meets the standards 

established for qualification or can meet such standards before the 

date specified for award of the contract. 

(4) Nothing contained in this subsection requires the referral 

of an offer to the Small Business Administration pursuant to section 8(b)(7) of the Small Business Act (15 U.S.C. 637(b)(7)) if the 

basis for the referral is a challenge by the offeror to either the validity of the qualification requirement or the offeror’s compliance 

with such requirement. 

(5) The head of an agency need not delay a proposed procurement in order to comply with subsection (b) or in order to provide 

a potential offeror with an opportunity to demonstrate its ability to 

meet the standards specified for qualification. 

(6) The requirements of subsection (b) also apply before enforcement of any qualified products list, qualified manufacturers 

list, or qualified bidders list. 

(d)(1) If the number of qualified sources or qualified products 

available to compete actively for an anticipated future requirement 

is fewer than two actual manufacturers or the products of two actual manufacturers, respectively, the head of the agency concerned 

shall— 

(A) periodically publish notice in the Commerce Business 

Daily soliciting additional sources or products to seek qualification, unless the contracting officer determines that such publication would compromise national security; and 

(B) bear the cost of conducting the specified testing and 

evaluation (excluding the costs associated with producing the 

item or establishing the production, quality control, or other 

system to be tested and evaluated) for a small business concern or a product manufactured by a small business concern 

which has met the standards specified for qualification and 

which could reasonably be expected to compete for a contract 

for that requirement, but such costs may be borne only if the 

head of the agency determines that such additional qualified 

sources or products are likely to result in cost savings from increased competition for future requirements sufficient to amortize the costs incurred by the agency within a reasonable period of time considering the duration and dollar value of anticipated future requirements. 

(2) The head of an agency shall require a prospective contractor requesting the United States to bear testing and evaluation 

costs under paragraph (1)(B) to certify as to its status as a small 

business concern under section 3 of the Small Business Act (15 

U.S.C. 632). 

(e) Within seven years after the establishment of a qualification requirement under subsection (b) or within seven years following an agency’s enforcement of a qualified products list, qualified manufacturers list, or qualified bidders list, any such qualification requirement shall be examined and revalidated in accordance 

with the requirements of subsection (b). The preceding sentence 
§ 2320 CH. 137—PROCUREMENT GENERALLY 1184 

does not apply in the case of a qualification requirement for which 

a waiver is in effect under subsection (c)(2). 

(f) Except in an emergency as determined by the head of the 

agency, whenever the head of the agency determines not to enforce 

a qualification requirement for a solicitation, the agency may not 

thereafter enforce that qualification requirement unless the agency 

complies with the requirements of subsection (b). 

(g) DEFINITIONS.—In this section: 

(1) The term ‘‘aviation critical safety item’’ means a part, 

an assembly, installation equipment, launch equipment, recovery equipment, or support equipment for an aircraft or aviation 

weapon system if the part, assembly, or equipment contains a 

characteristic any failure, malfunction, or absence of which 

could cause a catastrophic or critical failure resulting in the 

loss of or serious damage to the aircraft or weapon system, an 

unacceptable risk of personal injury or loss of life, or an 

uncommanded engine shutdown that jeopardizes safety. 

(2) The term ‘‘ship critical safety item’’ means any ship 

part, assembly, or support equipment containing a characteristic the failure, malfunction, or absence of which could 

cause a catastrophic or critical failure resulting in loss of or serious damage to the ship or unacceptable risk of personal injury or loss of life. 

(3) The term ‘‘design control activity’’, with respect to an 

aviation critical safety item or ship critical safety item, means 

the systems command of a military department that is specifically responsible for ensuring the airworthiness of an aviation 

system or equipment, or the seaworthiness of a ship or ship 

equipment, in which such item is to be used. 

(Added Pub. L. 98–525, title XII, Sec. 1216(a), Oct. 19, 1984, 98 Stat. 2593; amended Pub. L. 

100–26, Sec. 7(d)(5), (i)(4), (k)(3), Apr. 21, 1987, 101 Stat. 281, 282, 284; Pub. L. 108–136, div. 

A, title VIII, Sec. 802(d), Nov. 24, 2003, 117 Stat. 1541; Pub. L. 109–364, div. A, title I, Sec. 

130(d), Oct. 17, 2006, 120 Stat. 2110.) 

§ 2320. Rights in technical data 

(a)(1) The Secretary of Defense shall prescribe regulations to 

define the legitimate interest of the United States and of a contractor or subcontractor in technical data pertaining to an item or 

process. Such regulations shall be included in regulations of the 

Department of Defense prescribed as part of the Federal Acquisition Regulation. Such regulations may not impair any right of the 

United States or of any contractor or subcontractor with respect to 

patents or copyrights or any other right in technical data otherwise 

established by law. Such regulations also may not impair the right 

of a contractor or subcontractor to receive from a third party a fee 

or royalty for the use of technical data pertaining to an item or 

process developed exclusively at private expense by the contractor 

or subcontractor, except as otherwise specifically provided by law. 

(2) Such regulations shall include the following provisions: 

(A) In the case of an item or process that is developed by 

a contractor or subcontractor exclusively with Federal funds 

(other than an item or process developed under a contract or 

subcontract to which regulations under section 9(j)(2) of the 

Small Business Act (15 U.S.C. 638(j)(2)) apply), the United 

States shall have the unlimited right to— 
1185 § 2320 CH. 137—PROCUREMENT GENERALLY 

(i) use technical data pertaining to the item or process; 

or 

(ii) release or disclose the technical data to persons 

outside the government or permit the use of the technical 

data by such persons. 

(B) Except as provided in subparagraphs (C) and (D), in 

the case of an item or process that is developed by a contractor 

or subcontractor exclusively at private expense, the contractor 

or subcontractor may restrict the right of the United States to 

release or disclose technical data pertaining to the item or 

process to persons outside the government or permit the use of 

the technical data by such persons. 

(C) Subparagraph (B) does not apply to technical data 

that— 

(i) constitutes a correction or change to data furnished 

by the United States; 

(ii) relates to form, fit, or function; 

(iii) is necessary for operation, maintenance, installation, or training (other than detailed manufacturing or 

process data); or 

(iv) is otherwise publicly available or has been released or disclosed by the contractor or subcontractor without restriction on further release or disclosure. 

(D) Notwithstanding subparagraph (B), the United States 

may release or disclose technical data to persons outside the 

Government, or permit the use of technical data by such persons, if— 

(i) such release, disclosure, or use— 

(I) is necessary for emergency repair and overhaul; or 

(II) is a release or disclosure of technical data 

(other than detailed manufacturing or process data) to, 

or use of such data by, a foreign government that is 

in the interest of the United States and is required for 

evaluational or informational purposes; 

(ii) such release, disclosure, or use is made subject to 

a prohibition that the person to whom the data is released 

or disclosed may not further release, disclose, or use such 

data; and 

(iii) the contractor or subcontractor asserting the restriction is notified of such release, disclosure, or use. 

(E) In the case of an item or process that is developed in 

part with Federal funds and in part at private expense, the respective rights of the United States and of the contractor or 

subcontractor in technical data pertaining to such item or process shall be established as early in the acquisition process as 

practicable (preferably during contract negotiations) and shall 

be based upon negotiations between the United States and the 

contractor, except in any case in which the Secretary of Defense determines, on the basis of criteria established in the 

regulations, that negotiations would not be practicable. The establishment of such rights shall be based upon consideration of 

all of the following factors: 
§ 2320 CH. 137—PROCUREMENT GENERALLY 1186 

(i) The statement of congressional policy and objectives 

in section 200 of title 35, the statement of purposes in section 2(b) of the Small Business Innovation Development 

Act of 1982 (15 U.S.C. 638 note), and the declaration of 

policy in section 2 of the Small Business Act (15 U.S.C. 

631). 

(ii) The interest of the United States in increasing 

competition and lowering costs by developing and locating 

alternative sources of supply and manufacture. 

(iii) The interest of the United States in encouraging 

contractors to develop at private expense items for use by 

the Government. 

(iv) Such other factors as the Secretary of Defense 

may prescribe. 

(F) A contractor or subcontractor (or a prospective contractor or subcontractor) may not be required, as a condition 

of being responsive to a solicitation or as a condition for the 

award of a contract— 

(i) to sell or otherwise relinquish to the United States 

any rights in technical data except— 

(I) rights in technical data described in subparagraph (A) for which a use or release restriction has 

been erroneously asserted by a contractor or subcontractor; 

(II) rights in technical data described in subparagraph (C); or 

(III) under the conditions described in subparagraph (D); or 

(ii) to refrain from offering to use, or from using, an 

item or process to which the contractor is entitled to restrict rights in data under subparagraph (B). 

(G) The Secretary of Defense may— 

(i) negotiate and enter into a contract with a contractor or subcontractor for the acquisition of rights in 

technical data not otherwise provided under subparagraph 

(C) or (D), if necessary to develop alternative sources of 

supply and manufacture; 

(ii) agree to restrict rights in technical data otherwise 

accorded to the United States under this section if the 

United States receives a royalty-free license to use, release, or disclose the data for purposes of the United 

States (including purposes of competitive procurement); or 

(iii) permit a contractor or subcontractor to license directly to a third party the use of technical data which the 

contractor is otherwise allowed to restrict, if necessary to 

develop alternative sources of supply and manufacture. 

(3) The Secretary of Defense shall define the terms ‘‘developed’’, ‘‘exclusively with Federal funds’’, and ‘‘exclusively at private 

expense’’ in regulations prescribed under paragraph (1). In defining 

such terms, the Secretary shall specify the manner in which indirect costs shall be treated and shall specify that amounts spent for 

independent research and development and bid and proposal costs 

shall not be considered to be Federal funds for the purposes of 
1187 § 2320 CH. 137—PROCUREMENT GENERALLY 

paragraph (2)(B), but shall be considered to be Federal funds for 

the purposes of paragraph (2)(A). 

(b) Regulations prescribed under subsection (a) shall require 

that, whenever practicable, a contract for supplies or services entered into by an agency named in section 2303 of this title contain 

appropriate provisions relating to technical data, including provisions— 

(1) defining the respective rights of the United States and 

the contractor or subcontractor (at any tier) regarding any 

technical data to be delivered under the contract and providing 

that, in the case of a contract for a commercial item, the item 

shall be presumed to be developed at private expense unless 

shown otherwise in accordance with section 2321(f); 

(2) specifying the technical data, if any, to be delivered 

under the contract and delivery schedules for such delivery; 

(3) establishing or referencing procedures for determining 

the acceptability of technical data to be delivered under the 

contract; 

(4) establishing separate contract line items for the technical data, if any, to be delivered under the contract; 

(5) to the maximum practicable extent, identifying, in advance of delivery, technical data which is to be delivered with 

restrictions on the right of the United States to use such data; 

(6) requiring the contractor to revise any technical data delivered under the contract to reflect engineering design 

changes made during the performance of the contract and affecting the form, fit, and function of the items specified in the 

contract and to deliver such revised technical data to an agency within a time specified in the contract; 

(7) establishing remedies to be available to the United 

States when technical data required to be delivered or made 

available under the contract is found to be incomplete or inadequate or to not satisfy the requirements of the contract concerning technical data; and 

(8) authorizing the head of the agency to withhold payments under the contract (or exercise such other remedies as 

the head of the agency considers appropriate) during any period if the contractor does not meet the requirements of the 

contract pertaining to the delivery of technical data. 

(c) Nothing in this section or in section 2305(d) of this title prohibits the Secretary of Defense from— 

(1) prescribing standards for determining whether a contract entered into by the Department of Defense shall provide 

for a time to be specified in the contract after which the United 

States shall have the right to use (or have used) for any purpose of the United States all technical data required to be delivered to the United States under the contract or providing for 

such a period of time (not to exceed 7 years) as a negotiation 

objective; 

(2) notwithstanding any limitation upon the license rights 

conveyed under subsection (a)— 

(A) allowing a covered Government support contractor 

access to and use of any technical data delivered under a 

contract for the sole purpose of furnishing independent 
§ 2320 CH. 137—PROCUREMENT GENERALLY 1188 

and impartial advice or technical assistance directly to the 

Government in support of the Government’s management 

and oversight of the program or effort to which such technical data relates; or 

(B) allowing a covered litigation support contractor access to and use of any technical, proprietary, or confidential data delivered under a contract for the sole purpose of 

providing litigation support to the Government in the form 

of administrative, technical, or professional services during 

or in anticipation of litigation; or 

(3) prescribing reasonable and flexible guidelines, including negotiation objectives, for the conduct of negotiations regarding the respective rights in technical data of the United 

States and the contractor. 

(d) The Secretary of Defense shall by regulation establish programs which provide domestic business concerns an opportunity to 

purchase or borrow replenishment parts from the United States for 

the purpose of design replication or modification, to be used by 

such concerns in the submission of subsequent offers to sell the 

same or like parts to the United States. Nothing in this subsection 

limits the authority of the head of an agency to impose restrictions 

on such a program related to national security considerations, inventory needs of the United States, the improbability of future purchases of the same or like parts, or any additional restriction otherwise required by law. 

(e) The Secretary of Defense shall require program managers 

for major weapon systems and subsystems of major weapon systems to assess the long-term technical data needs of such systems 

and subsystems and establish corresponding acquisition strategies 

that provide for technical data rights needed to sustain such systems and subsystems over their life cycle. Such strategies may include the development of maintenance capabilities within the Department of Defense or competition for contracts for sustainment of 

such systems or subsystems. Assessments and corresponding acquisition strategies developed under this section with respect to a 

weapon system or subsystem shall— 

(1) be developed before issuance of a contract solicitation 

for the weapon system or subsystem; 

(2) address the merits of including a priced contract option 

for the future delivery of technical data that were not acquired 

upon initial contract award; 

(3) address the potential for changes in the sustainment 

plan over the life cycle of the weapon system or subsystem; and 

(4) apply to weapon systems and subsystems that are to be 

supported by performance-based logistics arrangements as well 

as to weapons systems and subsystems that are to be supported by other sustainment approaches. 

(f) In this section, the term ‘‘covered Government support contractor’’ means a contractor under a contract the primary purpose 

of which is to furnish independent and impartial advice or technical assistance directly to the Government in support of the Government’s management and oversight of a program or effort (rather 

than to directly furnish an end item or service to accomplish a program or effort), which contractor— 
1189 § 2320 CH. 137—PROCUREMENT GENERALLY 

(1) is not affiliated with the prime contractor or a first-tier 

subcontractor on the program or effort, or with any direct competitor of such prime contractor or any such first-tier subcontractor in furnishing end items or services of the type developed or produced on the program or effort; and 

(2) executes a contract with the Government agreeing to 

and acknowledging— 

(A) that proprietary or nonpublic technical data furnished will be accessed and used only for the purposes 

stated in that contract; 

(B) that the covered Government support contractor 

will enter into a non-disclosure agreement with the contractor to whom the rights to the technical data belong; 

(C) that the covered Government support contractor 

will take all reasonable steps to protect the proprietary 

and nonpublic nature of the technical data furnished to the 

covered Government support contractor during the program or effort for the period of time in which the Government is restricted from disclosing the technical data outside of the Government; 

(D) that a breach of that contract by the covered Government support contractor with regard to a third party’s 

ownership or rights in such technical data may subject the 

covered Government support contractor— 

(i) to criminal, civil, administrative, and contractual actions in law and equity for penalties, damages, 

and other appropriate remedies by the United States; 

and 

(ii) to civil actions for damages and other appropriate remedies by the contractor or subcontractor 

whose technical data is affected by the breach; and 

(E) that such technical data provided to the covered 

Government support contractor under the authority of this 

section shall not be used by the covered Government support contractor to compete against the third party for Government or non-Government contracts. 

(g) In this section, the term ‘‘covered litigation support contractor’’ means a contractor (including an expert or technical consultant) under contract with the Department of Defense to provide 

litigation support, which contractor executes a contract with the 

Government agreeing to and acknowledging— 

(1) that proprietary or nonpublic technical data furnished 

will be accessed and used only for the purposes stated in that 

contract; 

(2) that the covered litigation support contractor will take 

all reasonable steps to protect the proprietary and nonpublic 

nature of the technical data furnished to the covered litigation 

support contractor; and 

(3) that such technical data provided to the covered litigation support contractor under the authority of this section shall 

not be used by the covered litigation support contractor to compete against the third party for Government or non-Government contracts. 
§ 2321 CH. 137—PROCUREMENT GENERALLY 1190 

(Added Pub. L. 98–525, title XII, Sec. 1216(a), Oct. 19, 1984, 98 Stat. 2595; amended Pub. L. 

98–577, title III, Sec. 301(b), Oct. 30, 1984, 98 Stat. 3076; Pub. L. 99–145, title IX, Sec. 

961(d)(1), Nov. 8, 1985, 99 Stat. 703; Pub. L. 99–500, Sec. 101(c) [title X, Sec. 953(a)], Oct. 18, 

1986, 100 Stat. 1783–82, 1783–169, and Pub. L. 99–591, Sec. 101(c) [title X, Sec. 953(a)], Oct. 

30, 1986, 100 Stat. 3341–82, 3341–169; Pub. L. 99–661, div. A, title IX, formerly title IV, Sec. 

953(a), Nov. 14, 1986, 100 Stat. 3949, renumbered title IX, Pub. L. 100–26, Sec. 3(5), Apr. 21, 

1987, 101 Stat. 273; Pub. L. 100–26, Sec. 7(a)(4), Apr. 21, 1987, 101 Stat. 275; Pub. L. 100– 

180, div. A, title VIII, Sec. 808(a), (b), Dec. 4, 1987, 101 Stat. 1128, 1130; Pub. L. 101–189, div. 

A, title VIII, Sec. 853(b)(2), Nov. 29, 1989, 103 Stat. 1518; Pub. L. 103–355, title VIII, Sec. 

8106(a), Oct. 13, 1994, 108 Stat. 3393; Pub. L. 108–136, div. A, title VIII, Sec. 844, Nov. 24, 

2003, 117 Stat. 1553; Pub. L. 109–364, div. A, title VIII, Sec. 802(a), Oct. 17, 2006, 120 Stat. 

2312; Pub. L. 111–84, div. A, title VIII, Sec. 821, Oct. 28, 2009, 123 Stat. 2411; Pub. L. 111– 

383, div. A, title VIII, Secs. 801(a), 824(b), Jan. 7, 2011, 124 Stat. 4253, 4269.) 

§ 2321. Validation of proprietary data restrictions 

(a) CONTRACTS COVERED BY SECTION.—This section applies to 

any contract for supplies or services entered into by the Department of Defense that includes provisions for the delivery of technical data. 

(b) CONTRACTOR JUSTIFICATION FOR RESTRICTIONS.—A contract 

subject to this section shall provide that a contractor under the 

contract and any subcontractor under the contract at any tier shall 

be prepared to furnish to the contracting officer a written justification for any use or release restriction (as defined in subsection (i)) 

asserted by the contractor or subcontractor. 

(c) REVIEW OF RESTRICTIONS.—(1) The Secretary of Defense 

shall ensure that there is a thorough review of the appropriateness 

of any use or release restriction asserted with respect to technical 

data by a contractor or subcontractor at any tier under a contract 

subject to this section. 

(2) The review of an asserted use or release restriction under 

paragraph (1) shall be conducted before the end of the three-year 

period beginning on the later of— 

(A) the date on which final payment is made on the contract under which the technical data is required to be delivered; or 

(B) the date on which the technical data is delivered under 

the contract. 

(d) CHALLENGES TO RESTRICTIONS.—(1) The Secretary of Defense may challenge a use or release restriction asserted with respect to technical data by a contractor or subcontractor at any tier 

under a contract subject to this section if the Secretary finds that— 

(A) reasonable grounds exist to question the current validity of the asserted restriction; and 

(B) the continued adherence by the United States to the 

asserted restriction would make it impracticable to procure the 

item to which the technical data pertain competitively at a 

later time. 

(2)(A) Except as provided in subparagraph (C), a challenge to 

an asserted use or release restriction may not be made under paragraph (1) after the end of the three-year period described in subparagraph (B) unless the technical data involved— 

(i) are publicly available; 

(ii) have been furnished to the United States without restriction; or 

(iii) have been otherwise made available without restriction. 
1191 § 2321 CH. 137—PROCUREMENT GENERALLY 

(B) The three-year period referred to in subparagraph (A) is 

the three-year period beginning on the later of— 

(i) the date on which final payment is made on the contract under which the technical data are required to be delivered; or 

(ii) the date on which the technical data are delivered 

under the contract. 

(C) The limitation in this paragraph shall not apply to a case 

in which the Secretary finds that reasonable grounds exist to believe that a contractor or subcontractor has erroneously asserted a 

use or release restriction with regard to technical data described in 

section 2320(a)(2)(A) of this title. 

(3) If the Secretary challenges an asserted use or release restriction under paragraph (1), the Secretary shall provide written 

notice of the challenge to the contractor or subcontractor asserting 

the restriction. Any such notice shall— 

(A) state the specific grounds for challenging the asserted 

restriction; 

(B) require a response within 60 days justifying the current validity of the asserted restriction; and 

(C) state that evidence of a justification described in paragraph (4) may be submitted. 

(4) It is a justification of an asserted use or release restriction 

challenged under paragraph (1) that, within the three-year period 

preceding the challenge to the restriction, the Department of Defense validated a restriction identical to the asserted restriction 

if— 

(A) such validation occurred after a challenge to the validated restriction under this subsection; and 

(B) the validated restriction was asserted by the same contractor or subcontractor (or a licensee of such contractor or 

subcontractor). 

(e) TIME FOR CONTRACTORS TO SUBMIT JUSTIFICATIONS.—If a 

contractor or subcontractor asserting a use or release restriction 

submits to the contracting officer a written request, showing the 

need for additional time to comply with the requirement to justify 

the current validity of the asserted restriction, additional time to 

adequately permit the submission of such justification shall be provided by the contracting officer as appropriate. If a party asserting 

a restriction receives notices of challenges to restrictions on technical data from more than one contracting officer, and notifies each 

contracting officer of the existence of more than one challenge, the 

contracting officer initiating the first in time challenge, after consultation with the party asserting the restriction and the other contracting officers, shall formulate a schedule of responses to each of 

the challenges that will afford the party asserting the restriction 

with an equitable opportunity to respond to each such challenge. 

(f) PRESUMPTION OF DEVELOPMENT EXCLUSIVELY AT PRIVATE

EXPENSE.—(1) Except as provided in paragraph (2), in the case of 

a challenge to a use or release restriction that is asserted with respect to technical data of a contractor or subcontractor under a contract for commercial items, the contracting officer shall presume 

that the contractor or subcontractor has justified the restriction on 

the basis that the item was developed exclusively at private ex-
§ 2321 CH. 137—PROCUREMENT GENERALLY 1192 

4 In subsection (f)(2), ‘‘section 35(c) of the Office of Federal Procurement Policy Act (41 U.S.C. 

431(c))’’ should be ‘‘section 104 of title 41’’. 

pense, whether or not the contractor or subcontractor submits a 

justification in response to the notice provided pursuant to subsection (d)(3). In such a case, the challenge to the use or release 

restriction may be sustained only if information provided by the 

Department of Defense demonstrates that the item was not developed exclusively at private expense. 

(2) In the case of a challenge to a use or release restriction that 

is asserted with respect to technical data of a contractor or subcontractor (other than technical data for a commercially available offthe-shelf item as defined in section 35(c) of the Office of Federal 

Procurement Policy Act (41 U.S.C. 431(c))) 4 for a major system or 

a subsystem or component thereof on the basis that the major system, subsystem or component was developed exclusively at private 

expense, the challenge to the use or release restriction shall be sustained unless information provided by the contractor or subcontractor demonstrates that the item was developed exclusively at 

private expense. 

(g) DECISION BY CONTRACTING OFFICER.—(1) Upon a failure by 

the contractor or subcontractor to submit any response under subsection (d)(3), the contracting officer shall issue a decision pertaining to the validity of the asserted restriction. 

(2) After review of any justification submitted in response to 

the notice provided pursuant to subsection (d)(3), the contracting 

officer shall, within 60 days of receipt of any justification submitted, issue a decision or notify the party asserting the restriction 

of the time within which a decision will be issued. 

(h) CLAIMS.—If a claim pertaining to the validity of the asserted restriction is submitted in writing to a contracting officer by 

a contractor or subcontractor at any tier, such claim shall be considered a claim within the meaning of chapter 71 of title 41. 

(i) RIGHTS AND LIABILITY UPON FINAL DISPOSITION.—(1) If, 

upon final disposition, the contracting officer’s challenge to the use 

or release restriction is sustained— 

(A) the restriction shall be cancelled; and 

(B) if the asserted restriction is found not to be substantially justified, the contractor or subcontractor asserting the restriction shall be liable to the United States for payment of the 

cost to the United States of reviewing the asserted restriction 

and the fees and other expenses (as defined in section 

2412(d)(2)(A) of title 28) incurred by the United States in challenging the asserted restriction, unless special circumstances 

would make such payment unjust. 

(2) If, upon final disposition, the contracting officer’s challenge 

to the use or release restriction is not sustained— 

(A) the United States shall continue to be bound by the restriction; and 

(B) the United States shall be liable for payment to the 

party asserting the restriction for fees and other expenses (as 

defined in section 2412(d)(2)(A) of title 28) incurred by the 

party asserting the restriction in defending the asserted re-
1193 § 2323 CH. 137—PROCUREMENT GENERALLY 

striction if the challenge by the United States is found not to 

be made in good faith. 

(j) USE OR RELEASE RESTRICTION DEFINED.—In this section, 

the term ‘‘use or release restriction’’, with respect to technical data 

delivered to the United States under a contract subject to this section, means a restriction by the contractor or subcontractor on the 

right of the United States— 

(1) to use such technical data; or 

(2) to release or disclose such technical data to persons 

outside the Government or permit the use of such technical 

data by persons outside the Government. 

(Added Pub. L. 98–525, title XII, Sec. 1216(a), Oct. 19, 1984, 98 Stat. 2597; amended Pub. L. 

99–500 Sec. 101(c) [title X, Sec. 953(b)], Oct. 18, 1986, 100 Stat. 1783–82, 1783–171, and Pub. 

L. 99–591, Sec. 101(c) [title X, Sec. 953(b)], Oct. 30, 1986, 100 Stat. 3341–82, 3341–171; Pub. 

L. 99–661, div. A, title IX, formerly title IV, Sec. 953(b), Nov. 14, 1986, 100 Stat. 3951, renumbered title IX, Pub. L. 100–26, Sec. 3(5), Apr. 21, 1987, 101 Stat. 273, Pub. L. 100–26, Sec. 

7(a)(5), Apr. 21, 1987, 101 Stat. 276; Pub. L. 100–180, div. A, title XII, Sec. 1231(6), Dec. 4, 

1987, 101 Stat. 1160; Pub. L. 103–35, title II, Sec. 201(g)(4), May 31, 1993, 107 Stat. 100; Pub. 

L. 103–355, title VIII, Sec. 8106(b), Oct. 13, 1994, 108 Stat. 3393; Pub. L. 109–364, div. A, title 

VIII, Sec. 802(b), Oct. 17, 2006, 120 Stat. 2313; Pub. L. 110–181, div. A, title VIII, Sec. 815(a)(2), 

Jan. 28, 2008, 122 Stat. 223; Pub. L. 111–350, Sec. 5(b)(18), Jan. 4, 2011, 124 Stat. 3844; Pub. 

L. 111–383, div. A, title VIII, Sec. 824(c), Jan. 7, 2011, 124 Stat. 4269.) 

[§ 2322. Repealed. Pub. L. 102–484, div. A, title X, Sec. 

1052(25)(A), Oct. 23, 1992, 106 Stat. 2500] 

§ 2323. Contract goal for small disadvantaged businesses 

and certain institutions of higher education 

(a) GOAL.—(1) Except as provided in subsection (d), a goal of 

5 percent of the amount described in subsection (b) shall be the objective of the Department of Defense, the Coast Guard, and the National Aeronautics and Space Administration in each fiscal year for 

the total combined amount obligated for contracts and subcontracts 

entered into with— 

(A) small business concerns, including mass media and advertising firms, owned and controlled by socially and economically disadvantaged individuals (as such term is used in section 8(d) of the Small Business Act (15 U.S.C. 637(d)) and regulations issued under that section), the majority of the earnings of which directly accrue to such individuals, and qualified 

HUBZone small business concerns (as defined in section 3(p) of 

the Small Business Act); 

(B) historically Black colleges and universities, including 

any nonprofit research institution that was an integral part of 

such a college or university before November 14, 1986; 

(C) minority institutions (as defined in section 365(3) of 

the Higher Education Act of 1965 (20 U.S.C. 1067k)); 

(D) Hispanic-serving institutions (as defined in section 

502(a) of the Higher Education Act of 1965 (20 U.S.C. 

1101a(a))); and 

(E) Native Hawaiian-serving institutions and Alaska Native-serving institutions (as defined in section 317 of the Higher Education Act of 1965). 

(2) The head of the agency shall establish a specific goal within 

the overall 5 percent goal for the award of prime contracts and subcontracts to historically Black colleges and universities, Hispanicserving institutions, Native Hawaiian-serving institutions and 
§ 2323 CH. 137—PROCUREMENT GENERALLY 1194 

Alaska Native-serving institutions, and minority institutions in 

order to increase the participation of such colleges and universities 

and institutions in the program provided for by this section. 

(3) The Federal Acquisition Regulation shall provide procedures or guidelines for contracting officers to set goals which agency prime contractors that are required to submit subcontracting 

plans under section 8(d)(4)(B) of the Small Business Act (15 U.S.C. 

637(d)(4)(B)) in furtherance of the agency’s program to meet the 5 

percent goal specified in paragraph (1) should meet in awarding 

subcontracts, including subcontracts to minority-owned media, to 

entities described in that paragraph. 

(b) AMOUNT.—(1) With respect to the Department of Defense, 

the requirements of subsection (a) for any fiscal year apply to the 

combined total of the following amounts: 

(A) Funds obligated for contracts entered into with the Department of Defense for such fiscal year for procurement. 

(B) Funds obligated for contracts entered into with the Department of Defense for such fiscal year for research, development, test, and evaluation. 

(C) Funds obligated for contracts entered into with the Department of Defense for such fiscal year for military construction. 

(D) Funds obligated for contracts entered into with the Department of Defense for operation and maintenance. 

(2) With respect to the Coast Guard, the requirements of subsection (a) for any fiscal year apply to the total value of all prime 

contract and subcontract awards entered into by the Coast Guard 

for such fiscal year. 

(3) With respect to the National Aeronautics and Space Administration, the requirements of subsection (a) for any fiscal year 

apply to the total value of all prime contract and subcontract 

awards entered into by the National Aeronautics and Space Administration for such fiscal year. 

(c) TYPES OF ASSISTANCE.—(1) To attain the goal specified in 

subsection (a)(1), the head of an agency shall provide technical assistance to the entities referred to in that subsection and, in the 

case of historically Black colleges and universities, Hispanic-serving institutions, Native Hawaiian-serving institutions and Alaska 

Native-serving institutions, and minority institutions, shall also 

provide infrastructure assistance. 

(2) Technical assistance provided under this section shall include information about the program, advice about agency procurement procedures, instruction in preparation of proposals, and other 

such assistance as the head of the agency considers appropriate. If 

the resources of the agency are inadequate to provide such assistance, the head of the agency may enter into contracts with minority private sector entities with experience and expertise in the design, development, and delivery of technical assistance services to 

eligible individuals, business firms and institutions, acquisition 

agencies, and prime contractors. Agency contracts with such entities shall be awarded annually, based upon, among other things, 

the number of minority small business concerns, historically Black 

colleges and universities, and minority institutions that each such 

entity brings into the program. 
1195 § 2323 CH. 137—PROCUREMENT GENERALLY 

(3) Infrastructure assistance provided by the Department of 

Defense under this section to historically Black colleges and universities, to Hispanic-serving institutions, to Native Hawaiian-serving 

institutions and Alaska Native-serving institutions, and to minority 

institutions may include programs to do the following: 

(A) Establish and enhance undergraduate, graduate, and 

doctoral programs in scientific disciplines critical to the national security functions of the Department of Defense. 

(B) Make Department of Defense personnel available to 

advise and assist faculty at such colleges and universities in 

the performance of defense research and in scientific disciplines critical to the national security functions of the Department of Defense. 

(C) Establish partnerships between defense laboratories 

and historically Black colleges and universities and minority 

institutions for the purpose of training students in scientific 

disciplines critical to the national security functions of the Department of Defense. 

(D) Award scholarships, fellowships, and the establishment 

of cooperative work-education programs in scientific disciplines 

critical to the national security functions of the Department of 

Defense. 

(E) Attract and retain faculty involved in scientific disciplines critical to the national security functions of the Department of Defense. 

(F) Equip and renovate laboratories for the performance of 

defense research. 

(G) Expand and equip Reserve Officer Training Corps activities devoted to scientific disciplines critical to the national 

security functions of the Department of Defense. 

(H) Provide other assistance as the Secretary determines 

appropriate to strengthen scientific disciplines critical to the 

national security functions of the Department of Defense or the 

college infrastructure to support the performance of defense research. 

(4) The head of the agency shall, to the maximum extent practical, carry out programs under this section at colleges, universities, and institutions that agree to bear a substantial portion of 

the cost associated with the programs. 

(d) APPLICABILITY.—Subsection (a) does not apply to the Department of Defense— 

(1) to the extent to which the Secretary of Defense determines that compelling national security considerations require 

otherwise; and 

(2) if the Secretary notifies Congress of such determination 

and the reasons for such determination. 

(e) COMPETITIVE PROCEDURES AND ADVANCE PAYMENTS.—To 

attain the goal of subsection (a): 

(1)(A) The head of the agency shall— 

(i) ensure that substantial progress is made in increasing awards of agency contracts to entities described in subsection (a)(1); 

(ii) exercise his utmost authority, resourcefulness, and 

diligence; 
§ 2323 CH. 137—PROCUREMENT GENERALLY 1196 

(iii) in the case of the Department of Defense, actively 

monitor and assess the progress of the military departments, Defense Agencies, and prime contractors of the Department of Defense in attaining such goal; and 

(iv) in the case of the Coast Guard and the National 

Aeronautics and Space Administration, actively monitor 

and assess the progress of the prime contractors of the 

agency in attaining such goal. 

(B) In making the assessment under clauses (iii) and (iv) 

of subparagraph (A), the head of the agency shall evaluate the 

extent to which use of the authority provided in paragraphs (2) 

and (3) and compliance with the requirement in paragraph (4) 

is effective for facilitating the attainment of the goal. 

(2) To the extent practicable and when necessary to facilitate achievement of the 5 percent goal described in subsection 

(a), the head of an agency shall make advance payments under 

section 2307 of this title to contractors described in subsection 

(a). The Federal Acquisition Regulation shall provide guidance 

to contracting officers for making advance payments to entities 

described in subsection (a)(1) under such section. 

(3)(A) To the extent practicable and when necessary to facilitate achievement of the 5 percent goal described in subsection (a), the head of an agency may, except as provided in 

subparagraph (B), enter into contracts using less than full and 

open competitive procedures (including awards under section 

8(a) of the Small Business Act) and partial set asides for entities described in subsection (a)(1), but shall pay a price not exceeding fair market cost by more than 10 percent in payment 

per contract to contractors or subcontractors described in subsection (a). The head of an agency shall adjust the percentage 

specified in the preceding sentence for any industry category if 

available information clearly indicates that nondisadvantaged 

small business concerns in such industry category are generally being denied a reasonable opportunity to compete for 

contracts because of the use of that percentage in the application of this paragraph. 

(B)(i) The Secretary of Defense may not exercise the authority under subparagraph (A) to enter into a contract for a 

price exceeding fair market cost if the regulations implementing that authority are suspended under clause (ii) with respect to that contract. 

(ii) At the beginning of each fiscal year, the Secretary shall 

determine, on the basis of the most recent data, whether the 

Department of Defense achieved the 5 percent goal described 

in subsection (a) during the fiscal year to which the data relates. Upon determining that the Department achieved the 

goal for the fiscal year to which the data relates, the Secretary 

shall issue a suspension, in writing, of the regulations that implement the authority under subparagraph (A). Such a suspension shall be in effect for the one-year period beginning 30 days 

after the date on which the suspension is issued and shall 

apply with respect to contracts awarded pursuant to solicitations issued during that period. 
1197 § 2323 CH. 137—PROCUREMENT GENERALLY 

(iii) For purposes of clause (ii), the term ‘‘most recent data’’ 

means data relating to the most recent fiscal year for which 

data are available. 

(4) To the extent practicable, the head of an agency shall 

maximize the number of minority small business concerns, historically Black colleges and universities, and minority institutions participating in the program. 

(5) Each head of an agency shall prescribe regulations 

which provide for the following: 

(A) Procedures or guidance for contracting officers to 

provide incentives for prime contractors referred to in subsection (a)(3) to increase subcontractor awards to entities 

described in subsection (a)(1). 

(B) A requirement that contracting officers emphasize 

the award of contracts to entities described in subsection 

(a)(1) in all industry categories, including those categories 

in which such entities have not traditionally dominated. 

(C) Guidance to agency personnel on the relationship 

among the following programs: 

(i) The program implementing this section. 

(ii) The program established under section 8(a) of 

the Small Business Act (15 U.S.C. 637(a)). 

(iii) The small business set-aside program established under section 15(a) of the Small Business Act 

(15 U.S.C. 644(a)). 

(D) With respect to an agency procurement which is 

reasonably likely to be set aside for entities described in 

subsection (a)(1), a requirement that (to the maximum extent practicable) the procurement be designated as such a 

set-aside before the solicitation for the procurement is 

issued. 

(E) Policies and procedures which, to the maximum 

extent practicable, will ensure that current levels in the 

number or dollar value of contracts awarded under the 

program established under section 8(a) of the Small Business Act (15 U.S.C. 637(a)) and under the small business 

set-aside program established under section 15(a) of the 

Small Business Act (15 U.S.C. 644(a)) are maintained and 

that every effort is made to provide new opportunities for 

contract awards to eligible entities, in order to meet the 

goal of subsection (a). 

(F) Implementation of this section in a manner which 

will not alter the procurement process under the program 

established under section 8(a) of the Small Business Act 

(15 U.S.C. 637(a)). 

(G) A requirement that one factor used in evaluating 

the performance of a contracting officer be the ability of 

the officer to increase contract awards to entities described 

in subsection (a)(1). 

(H) Increased technical assistance to entities described 

in subsection (a)(1). 

(f) PENALTIES AND REGULATIONS RELATING TO STATUS.—(1) 

Whoever for the purpose of securing a contract or subcontract 

under subsection (a) misrepresents the status of any concern or 
§ 2323 CH. 137—PROCUREMENT GENERALLY 1198 

person as a small business concern owned and controlled by a minority (as described in subsection (a)) or as a qualified HUBZone 

small business concern (as defined in section 3(p) of the Small 

Business Act), shall be punished by imprisonment for not more 

than one year, or a fine under title 18, or both. 

(2) The Federal Acquisition Regulation shall prohibit awarding 

a contract under this section to an entity described in subsection 

(a)(1) unless the entity agrees to comply with the requirements of 

section 15(o)(1) of the Small Business Act (15 U.S.C. 644(o)(1)). 

(g) INDUSTRY CATEGORIES.—(1) To the maximum extent practicable, the head of the agency shall— 

(A) ensure that no particular industry category bears a disproportionate share of the contracts awarded to attain the goal 

established by subsection (a); and 

(B) ensure that contracts awarded to attain the goal established by subsection (a) are made across the broadest possible 

range of industry categories. 

(2) Under procedures prescribed by the head of the agency, a 

person may request the Secretary to determine whether the use of 

small disadvantaged business set asides by a contracting activity 

of the agency has caused a particular industry category to bear a 

disproportionate share of the contracts awarded to attain the goal 

established for that contracting activity for the purposes of this section. Upon making a determination that a particular industry category is bearing a disproportionate share, the head of the agency 

shall take appropriate actions to limit the contracting activity’s use 

of set asides in awarding contracts in that particular industry category. 

(h) COMPLIANCE WITH SUBCONTRACTING PLAN REQUIREMENTS.—(1) The Federal Acquisition Regulation shall contain regulations to ensure that potential contractors submitting sealed bids 

or competitive proposals to the agency for procurement contracts to 

be awarded under the program provided for by this section are 

complying with applicable subcontracting plan requirements of section 8(d) of the Small Business Act (15 U.S.C. 637(d)). 

(2) The regulations required by paragraph (1) shall ensure 

that, with respect to a sealed bid or competitive proposal for which 

the bidder or offeror is required to negotiate or submit a subcontracting plan under section 8(d) of the Small Business Act (15 

U.S.C. 637(d)), the subcontracting plan shall be a factor in evaluating the bid or proposal. 

(i) ANNUAL REPORT.—(1) Not later than December 15 of each 

year, the head of the agency shall submit to Congress a report on 

the progress of the agency toward attaining the goal of subsection 

(a) during the preceding fiscal year. 

(2) The report required under paragraph (1) shall include the 

following: 

(A) A full explanation of any progress toward attaining the 

goal of subsection (a). 

(B) A plan to achieve the goal, if necessary. 

(j) DEFINITIONS.—In this section: 

(1) The term ‘‘agency’’ means the Department of Defense, 

the Coast Guard, and the National Aeronautics and Space Administration. 
1199 § 2323a CH. 137—PROCUREMENT GENERALLY 

(2) The term ‘‘head of an agency’’ means the Secretary of 

Defense, the Secretary of Homeland Security, and the Administrator of the National Aeronautics and Space Administration. 

(k) EFFECTIVE DATE.—(1) This section applies in the Department of Defense to each of fiscal years 1987 through 2009. 

(2) This section applies in the Coast Guard and the National 

Aeronautics and Space Administration in each of fiscal years 1995 

through 2009. 

(Added and amended Pub. L. 102–484, div. A, title VIII, Sec. 801(a)(1), (b)–(f), 802, Oct. 23, 

1992, 106 Stat. 2442–2444, 2446; Pub. L. 103–35, title II, Sec. 202(a)(6), May 31, 1993, 107 Stat. 

101; Pub. L. 103–160, div. A, title VIII, Sec. 811(a)–(c), (e), Nov. 30, 1993, 107 Stat. 1702; Pub. 

L. 103–355, title VII, Sec. 7105, Oct. 13, 1994, 108 Stat. 3369; Pub. L. 104–106, div. D, title 

XLIII, Sec. 4321(b)(8), Feb. 10, 1996, 110 Stat. 672; Pub. L. 105–135, title VI, Sec. 604(a), Dec. 

2, 1997, 111 Stat. 2632; Pub. L. 105–261, div. A, title VIII, Sec. 801, Oct. 17, 1998, 112 Stat. 

2080; Pub. L. 106–65, div. A, title VIII, Sec. 808, Oct. 5, 1999, 113 Stat. 705; Dec. 28, 2001, 

Pub. L. 107–107, div. A, title X, Sec. 1048(a)(17), 115 Stat. 1223; Pub. L. 107–296, title XVII, 

Sec. 1704(b)(1), Nov. 25, 2002, 116 Stat. 2314; Pub. L. 107–314, div. A, title VIII, Sec. 816, Dec. 

2, 2002, 116 Stat. 2610; Pub. L. 108–136, div. A, title X, Sec. 1031(a)(15), Nov. 24, 2003, 117 

Stat. 1597; Pub. L. 109–163, div. A, title VIII, Sec. 842, Jan. 6, 2006, 119 Stat. 3389; Pub. L. 

109–364, div. A, title VIII, Sec. 858, Oct. 17, 2006, 120 Stat. 2349; Pub. L. 110–181, div. A, title 

VIII, Sec. 891, Jan. 28, 2008, 122 Stat. 270; Pub. L. 111–383, div. A, title X, Sec. 1075(b)(31), 

Jan. 7, 2011, 124 Stat. 4370.) 

§ 2323a. Credit for Indian contracting in meeting certain 

subcontracting goals for small disadvantaged businesses and certain institutions of higher education 

(a) REGULATIONS.—Subject to subsections (b) and (c), in any 

case in which a subcontracting goal is specified in a Department 

of Defense contract in the implementation of section 2323 of this 

title and section 8(d) of the Small Business Act (15 U.S.C. 637(d)), 

credit toward meeting that subcontracting goal shall be given for— 

(1) work performed in connection with that Department of 

Defense contract, and work performed in connection with any 

subcontract awarded under that Department of Defense contract, if such work is performed on any Indian lands and meets 

the requirements of paragraph (1) of subsection (b); or 

(2) work performed in connection with that Department of 

Defense contract, and work performed in connection with any 

subcontract awarded under that Department of Defense contract, if the performance of such contract or subcontract is undertaken as a joint venture that meets the requirements of 

paragraph (2) of that subsection. 

(b) ELIGIBLE WORK.—(1) Work performed on Indian lands 

meets the requirements of this paragraph if— 

(A) not less than 40 percent of the workers directly engaged in the performance of the work are Indians; or 

(B) the contractor or subcontractor has an agreement with 

the tribal government having jurisdiction over such Indian 

lands that provides goals for training and development of the 

Indian workforce and Indian management. 

(2) A joint venture undertaking to perform a contract or subcontract meets the requirements of this paragraph if— 

(A) an Indian tribe or tribally owned corporation owns at 

least 50 percent of the joint venture; 

(B) the activities of the joint venture under the contract or 

subcontract provide employment opportunities for Indians either directly or through the purchase of products or services 

for the performance of such contract or subcontract; and 
§ 2324 CH. 137—PROCUREMENT GENERALLY 1200 

(C) the Indian tribe or tribally owned corporation manages 

the performance of such contract or subcontract. 

(c) EXTENT OF CREDIT.—The amount of the credit given toward 

the attainment of any subcontracting goal under subsection (a) 

shall be— 

(1) in the case of work performed as described in subsection (a)(1), the value of the work performed; and 

(2) in the case of a contract or subcontract undertaken to 

be performed by a joint venture as described in subsection 

(a)(2), an amount equal to the amount of the contract or subcontract multiplied by the percentage of the tribe’s or tribally 

owned corporation’s ownership interest in the joint venture. 

(d) REGULATIONS.—The Secretary of Defense shall prescribe 

regulations for the implementation of this section. 

(e) DEFINITIONS.—In this section: 

(1) The term ‘‘Indian lands’’ has the meaning given that 

term by section 4(4) of the Indian Gaming Regulatory Act (102 

Stat. 2468; 25 U.S.C. 2703(4)). 

(2) The term ‘‘Indian’’ has the meaning given that term by 

section 4(d) of the Indian Self-Determination and Education 

Assistance Act (25 U.S.C. 450b(d)). 

(3) The term ‘‘Indian tribe’’ has the meaning given that 

term by section 4(e) of the Indian Self-Determination and Education Assistance Act (25 U.S.C. 450b(e)). 

(4) The term ‘‘tribally owned corporation’’ means a corporation owned entirely by an Indian tribe. 

(Added Pub. L. 102–484, div. A, title VIII, Sec. 801(g)(1), Oct. 23, 1992, 106 Stat. 2445; amended 

Pub. L. 104–201, div. A, title X, Sec. 1074(a)(13), Sept. 23, 1996, 110 Stat. 2659.) 

§ 2324. Allowable costs under defense contracts 

(a) INDIRECT COST THAT VIOLATES A FAR COST PRINCIPLE.— 

The head of an agency shall require that a covered contract provide 

that if the contractor submits to the agency a proposal for settlement of indirect costs incurred by the contractor for any period 

after such costs have been accrued and if that proposal includes the 

submission of a cost which is unallowable because the cost violates 

a cost principle in the Federal Acquisition Regulation or applicable 

agency supplement to the Federal Acquisition Regulation, the cost 

shall be disallowed. 

(b) PENALTY FOR VIOLATION OF COST PRINCIPLE.—(1) If the 

head of the agency determines that a cost submitted by a contractor in its proposal for settlement is expressly unallowable 

under a cost principle referred to in subsection (a) that defines the 

allowability of specific selected costs, the head of the agency shall 

assess a penalty against the contractor in an amount equal to— 

(A) the amount of the disallowed cost allocated to covered 

contracts for which a proposal for settlement of indirect costs 

has been submitted; plus 

(B) interest (to be computed based on provisions in the 

Federal Acquisition Regulation) to compensate the United 

States for the use of any funds which a contractor has been 

paid in excess of the amount to which the contractor was entitled. 
1201 § 2324 CH. 137—PROCUREMENT GENERALLY 

(2) If the head of the agency determines that a proposal for settlement of indirect costs submitted by a contractor includes a cost 

determined to be unallowable in the case of such contractor before 

the submission of such proposal, the head of the agency shall assess a penalty against the contractor in an amount equal to two 

times the amount of the disallowed cost allocated to covered contracts for which a proposal for settlement of indirect costs has been 

submitted. 

(c) WAIVER OF PENALTY.—The Federal Acquisition Regulation 

shall provide for a penalty under subsection (b) to be waived in the 

case of a contractor’s proposal for settlement of indirect costs 

when— 

(1) the contractor withdraws the proposal before the formal 

initiation of an audit of the proposal by the Federal Government and resubmits a revised proposal; 

(2) the amount of unallowable costs subject to the penalty 

is insignificant; or 

(3) the contractor demonstrates, to the contracting officer’s 

satisfaction, that— 

(A) it has established appropriate policies and personnel training and an internal control and review system 

that provide assurances that unallowable costs subject to 

penalties are precluded from being included in the contractor’s proposal for settlement of indirect costs; and 

(B) the unallowable costs subject to the penalty were 

inadvertently incorporated into the proposal. 

(d) APPLICABILITY OF CONTRACT DISPUTES PROCEDURE TO DISALLOWANCE OF COST AND ASSESSMENT OF PENALTY.—An action of 

the head of an agency under subsection (a) or (b)— 

(1) shall be considered a final decision for the purposes of 

section 7103 of title 41; and 

(2) is appealable in the manner provided in section 7104(a) 

of title 41. 

(e) SPECIFIC COSTS NOT ALLOWABLE.—(1) The following costs 

are not allowable under a covered contract: 

(A) Costs of entertainment, including amusement, diversion, and social activities and any costs directly associated with 

such costs (such as tickets to shows or sports events, meals, 

lodging, rentals, transportation, and gratuities). 

(B) Costs incurred to influence (directly or indirectly) legislative action on any matter pending before Congress, a State 

legislature, or a legislative body of a political subdivision of a 

State. 

(C) Costs incurred in defense of any civil or criminal fraud 

proceeding or similar proceeding (including filing of any false 

certification) brought by the United States where the contractor is found liable or has pleaded nolo contendere to a 

charge of fraud or similar proceeding (including filing of a false 

certification). 

(D) Payments of fines and penalties resulting from violations of, or failure to comply with, Federal, State, local, or foreign laws and regulations, except when incurred as a result of 

compliance with specific terms and conditions of the contract 

or specific written instructions from the contracting officer au-
§ 2324 CH. 137—PROCUREMENT GENERALLY 1202 

thorizing in advance such payments in accordance with applicable provisions of the Federal Acquisition Regulation. 

(E) Costs of membership in any social, dining, or country 

club or organization. 

(F) Costs of alcoholic beverages. 

(G) Contributions or donations, regardless of the recipient. 

(H) Costs of advertising designed to promote the contractor 

or its products. 

(I) Costs of promotional items and memorabilia, including 

models, gifts, and souvenirs. 

(J) Costs for travel by commercial aircraft which exceed 

the amount of the standard commercial fare. 

(K) Costs incurred in making any payment (commonly 

known as a ‘‘golden parachute payment’’) which is— 

(i) in an amount in excess of the normal severance pay 

paid by the contractor to an employee upon termination of 

employment; and 

(ii) is paid to the employee contingent upon, and following, a change in management control over, or ownership of, the contractor or a substantial portion of the contractor’s assets. 

(L) Costs of commercial insurance that protects against the 

costs of the contractor for correction of the contractor’s own defects in materials or workmanship. 

(M) Costs of severance pay paid by the contractor to foreign nationals employed by the contractor under a service contract performed outside the United States, to the extent that 

the amount of severance pay paid in any case exceeds the 

amount paid in the industry involved under the customary or 

prevailing practice for firms in that industry providing similar 

services in the United States, as determined under the Federal 

Acquisition Regulation. 

(N) Costs of severance pay paid by the contractor to a foreign national employed by the contractor under a service contract performed in a foreign country if the termination of the 

employment of the foreign national is the result of the closing 

of, or the curtailment of activities at, a United States military 

facility in that country at the request of the government of that 

country. 

(O) Costs incurred by a contractor in connection with any 

criminal, civil, or administrative proceeding commenced by the 

United States or a State, to the extent provided in subsection 

(k). 

(P) Costs of compensation of senior executives of contractors for a fiscal year, regardless of the contract funding source, 

to the extent that such compensation exceeds the benchmark 

compensation amount determined applicable for the fiscal year 

by the Administrator for Federal Procurement Policy under 

section 1127 of title 41. 

(2)(A) The Secretary of Defense may provide in a military 

banking contract that the provisions of paragraphs (1)(M) and 

(1)(N) shall not apply to costs incurred under the contract by the 

contractor for payment of mandated foreign national severance pay. 

The Secretary may include such a provision in a military banking 
1203 § 2324 CH. 137—PROCUREMENT GENERALLY 

contract only if the Secretary determines, with respect to that contract, that the contractor has taken (or has established plans to 

take) appropriate actions within the contractor’s control to minimize the amount and number of incidents of the payment of severance pay by the contractor to employees under the contract who are 

foreign nationals. 

(B) In subparagraph (A): 

(i) The term ‘‘military banking contract’’ means a contract 

between the Secretary and a financial institution under which 

the financial institution operates a military banking facility 

outside the United States for use by members of the armed 

forces stationed or deployed outside the United States and 

other authorized personnel. 

(ii) The term ‘‘mandated foreign national severance pay’’ 

means severance pay paid by a contractor to a foreign national 

employee the payment of which by the contractor is required 

in order to comply with a law that is generally applicable to 

a significant number of businesses in the country in which the 

foreign national receiving the payment performed services 

under the contract. 

(C) Subparagraph (A) does not apply to a contract with a financial institution that is owned or controlled by citizens or nationals 

of a foreign country, as determined by the Secretary of Defense. 

Such a determination shall be made in accordance with the criteria 

set out in paragraph (1) of section 4(g) of the Buy American Act 

(as added by section 7002(2) of the Omnibus Trade and Competitiveness Act of 1988) and the policy guidance referred to in paragraph (2)(A) of that section. 

(3)(A) Pursuant to the Federal Acquisition Regulation and subject to the availability of appropriations, the head of an agency 

awarding a covered contract (other than a contract to which paragraph (2) applies) may waive the application of the provisions of 

paragraphs (1)(M) and (1)(N) to that contract if the head of the 

agency determines that— 

(i) the application of such provisions to the contract would 

adversely affect the continuation of a program, project, or activity that provides significant support services for members of 

the armed forces stationed or deployed outside the United 

States; 

(ii) the contractor has taken (or has established plans to 

take) appropriate actions within the contractor’s control to 

minimize the amount and number of incidents of the payment 

of severance pay by the contractor to employees under the contract who are foreign nationals; and 

(iii) the payment of severance pay is necessary in order to 

comply with a law that is generally applicable to a significant 

number of businesses in the country in which the foreign national receiving the payment performed services under the contract or is necessary to comply with a collective bargaining 

agreement. 

(B) The head of an agency shall include in the solicitation for 

a covered contract a statement indicating— 

(i) that a waiver has been granted under subparagraph (A) 

for the contract; or 
§ 2324 CH. 137—PROCUREMENT GENERALLY 1204 

(ii) whether the head of the agency will consider granting 

such a waiver, and, if the agency head will consider granting 

a waiver, the criteria to be used in granting the waiver. 

(C) The head of an agency shall make the final determination 

regarding whether to grant a waiver under subparagraph (A) with 

respect to a covered contract before award of the contract. 

(4) The provisions of the Federal Acquisition Regulation implementing this section may establish appropriate definitions, exclusions, limitations, and qualifications. 

(f) REQUIRED REGULATIONS.—(1) The Federal Acquisition Regulation shall contain provisions on the allowability of contractor 

costs. Such provisions shall define in detail and in specific terms 

those costs which are unallowable, in whole or in part, under covered contracts. The regulations shall, at a minimum, clarify the 

cost principles applicable to contractor costs of the following: 

(A) Air shows. 

(B) Membership in civic, community, and professional organizations. 

(C) Recruitment. 

(D) Employee morale and welfare. 

(E) Actions to influence (directly or indirectly) executive 

branch action on regulatory and contract matters (other than 

costs incurred in regard to contract proposals pursuant to solicited or unsolicited bids). 

(F) Community relations. 

(G) Dining facilities. 

(H) Professional and consulting services, including legal 

services. 

(I) Compensation. 

(J) Selling and marketing. 

(K) Travel. 

(L) Public relations. 

(M) Hotel and meal expenses. 

(N) Expense of corporate aircraft. 

(O) Company-furnished automobiles. 

(P) Advertising. 

(Q) Conventions. 

(2) The Federal Acquisition Regulation shall require that a 

contracting officer not resolve any questioned costs until he has obtained— 

(A) adequate documentation with respect to such costs; 

and 

(B) the opinion of the contract auditor on the allowability 

of such costs. 

(3) The Federal Acquisition Regulation shall provide that, to 

the maximum extent practicable, the contract auditor be present at 

any negotiation or meeting with the contractor regarding a determination of the allowability of indirect costs of the contractor. 

(4) The Federal Acquisition Regulation shall require that all 

categories of costs designated in the report of the contract auditor 

as questioned with respect to a proposal for settlement be resolved 

in such a manner that the amount of the individual questioned 

costs that are paid will be reflected in the settlement. 
1205 § 2324 CH. 137—PROCUREMENT GENERALLY 

(g) APPLICABILITY OF REGULATIONS TO SUBCONTRACTORS.—The 

regulations referred to in subsections (e) and (f)(1) shall require 

prime contractors of a covered contract, to the maximum extent 

practicable, to apply the provisions of such regulations to all subcontractors of the covered contract. 

(h) CONTRACTOR CERTIFICATION REQUIRED.—(1) A proposal for 

settlement of indirect costs applicable to a covered contract shall 

include a certification by an official of the contractor that, to the 

best of the certifying official’s knowledge and belief, all indirect 

costs included in the proposal are allowable. Any such certification 

shall be in a form prescribed in the Federal Acquisition Regulation. 

(2) The head of the agency or the Secretary of the military department concerned may, in an exceptional case, waive the requirement for certification under paragraph (1) in the case of any contract if the head of the agency or the Secretary— 

(A) determines in such case that it would be in the interest 

of the United States to waive such certification; and 

(B) states in writing the reasons for that determination 

and makes such determination available to the public. 

(i) PENALTIES FOR SUBMISSION OF COST KNOWN AS NOT ALLOW- ABLE.—The submission to an agency of a proposal for settlement of 

costs for any period after such costs have been accrued that includes a cost that is expressly specified by statute or regulation as 

being unallowable, with the knowledge that such cost is unallowable, shall be subject to the provisions of section 287 of title 18 and 

section 3729 of title 31. 

(j) CONTRACTOR TO HAVE BURDEN OF PROOF.—In a proceeding 

before the Armed Services Board of Contract Appeals, the United 

States Court of Federal Claims, or any other Federal court in 

which the reasonableness of indirect costs for which a contractor 

seeks reimbursement from the Department of Defense is in issue, 

the burden of proof shall be upon the contractor to establish that 

those costs are reasonable. 

(k) PROCEEDING COSTS NOT ALLOWABLE.—(1) Except as otherwise provided in this subsection, costs incurred by a contractor in 

connection with any criminal, civil, or administrative proceeding 

commenced by the United States or a State are not allowable as 

reimbursable costs under a covered contract if the proceeding (A) 

relates to a violation of, or failure to comply with, a Federal or 

State statute or regulation, and (B) results in a disposition described in paragraph (2). 

(2) A disposition referred to in paragraph (1)(B) is any of the 

following: 

(A) In the case of a criminal proceeding, a conviction (including a conviction pursuant to a plea of nolo contendere) by 

reason of the violation or failure referred to in paragraph (1). 

(B) In the case of a civil or administrative proceeding involving an allegation of fraud or similar misconduct, a determination of contractor liability on the basis of the violation or 

failure referred to in paragraph (1). 

(C) In the case of any civil or administrative proceeding, 

the imposition of a monetary penalty by reason of the violation 

or failure referred to in paragraph (1). 

(D) A final decision— 
§ 2324 CH. 137—PROCUREMENT GENERALLY 1206 

(i) to debar or suspend the contractor; 

(ii) to rescind or void the contract; or 

(iii) to terminate the contract for default; 

by reason of the violation or failure referred to in paragraph 

(1). 

(E) A disposition of the proceeding by consent or compromise if such action could have resulted in a disposition described in subparagraph (A), (B), (C), or (D). 

(3) In the case of a proceeding referred to in paragraph (1) that 

is commenced by the United States and is resolved by consent or 

compromise pursuant to an agreement entered into by a contractor 

and the United States, the costs incurred by the contractor in connection with such proceeding that are otherwise not allowable as 

reimbursable costs under such paragraph may be allowed to the extent specifically provided in such agreement. 

(4) In the case of a proceeding referred to in paragraph (1) that 

is commenced by a State, the head of the agency or Secretary of 

the military department concerned that awarded the covered contract involved in the proceeding may allow the costs incurred by 

the contractor in connection with such proceeding as reimbursable 

costs if the agency head or Secretary determines, in accordance 

with the Federal Acquisition Regulation, that the costs were incurred as a result of (A) a specific term or condition of the contract, 

or (B) specific written instructions of the agency or military department. 

(5)(A) Except as provided in subparagraph (C), costs incurred 

by a contractor in connection with a criminal, civil, or administrative proceeding commenced by the United States or a State in connection with a covered contract may be allowed as reimbursable 

costs under the contract if such costs are not disallowable under 

paragraph (1), but only to the extent provided in subparagraph (B). 

(B)(i) The amount of the costs allowable under subparagraph 

(A) in any case may not exceed the amount equal to 80 percent of 

the amount of the costs incurred, to the extent that such costs are 

determined to be otherwise allowable and allocable under the Federal Acquisition Regulation. 

(ii) Regulations issued for the purpose of clause (i) shall provide for appropriate consideration of the complexity of procurement 

litigation, generally accepted principles governing the award of 

legal fees in civil actions involving the United States as a party, 

and such other factors as may be appropriate. 

(C) In the case of a proceeding referred to in subparagraph (A), 

contractor costs otherwise allowable as reimbursable costs under 

this paragraph are not allowable if (i) such proceeding involves the 

same contractor misconduct alleged as the basis of another criminal, civil, or administrative proceeding, and (ii) the costs of such 

other proceeding are not allowable under paragraph (1). 

(6) In this subsection: 

(A) The term ‘‘proceeding’’ includes an investigation. 

(B) The term ‘‘costs’’, with respect to a proceeding— 

(i) means all costs incurred by a contractor, whether 

before or after the commencement of any such proceeding; 

and 

(ii) includes— 
1207 § 2324 CH. 137—PROCUREMENT GENERALLY 

(I) administrative and clerical expenses; 

(II) the cost of legal services, including legal services performed by an employee of the contractor; 

(III) the cost of the services of accountants and 

consultants retained by the contractor; and 

(IV) the pay of directors, officers, and employees of 

the contractor for time devoted by such directors, officers, and employees to such proceeding. 

(C) The term ‘‘penalty’’ does not include restitution, reimbursement, or compensatory damages. 

(l) DEFINITIONS.—In this section: 

(1)(A) The term ‘‘covered contract’’ means a contract for an 

amount in excess of $500,000 that is entered into by the head 

of an agency, except that such term does not include a fixedprice contract without cost incentives or any firm fixed-price 

contract for the purchase of commercial items. 

(B) Effective on October 1 of each year that is divisible by 

five, the amount set forth in subparagraph (A) shall be adjusted to the equivalent amount in constant fiscal year 1994 

dollars. An amount, as so adjusted, that is not evenly divisible 

by $50,000 shall be rounded to the nearest multiple of $50,000. 

In the case of an amount that is evenly divisible by $25,000 

but is not evenly divisible by $50,000, the amount shall be 

rounded to the next higher multiple of $50,000. 

(2) The term ‘‘head of the agency’’ or ‘‘agency head’’ does 

not include the Secretary of a military department. 

(3) The term ‘‘agency’’ means the Department of Defense, 

the Coast Guard, and the National Aeronautics and Space Administration. 

(4) The term ‘‘compensation’’, for a year, means the total 

amount of wages, salary, bonuses and deferred compensation 

for the year, whether paid, earned, or otherwise accruing, as 

recorded in an employer’s cost accounting records for the year. 

(5) The term ‘‘senior executives’’, with respect to a contractor, means the five most highly compensated employees in 

management positions at each home office and each segment 

of the contractor. 

(6) The term ‘‘fiscal year’’ means a fiscal year established 

by a contractor for accounting purposes. 

(Added Pub. L. 99–145, title IX, Sec. 911(a)(1), Nov. 8, 1985, 99 Stat. 682; amended Pub. L. 99– 

190, Sec. 101(b) [title VIII, Sec. 8112(a)], Dec. 19, 1985, 99 Stat. 1185, 1223; Pub. L. 100–26, 

Sec. 7(k)(3), Apr. 21, 1987, 101 Stat. 284; Pub. L. 100–180, div. A, title VIII, Sec. 805(a), Dec. 

4, 1987, 101 Stat. 1126; Pub. L. 100–370, Sec. 1(f)(2)(A), (3)(A), July 19, 1988, 102 Stat. 846; 

Pub. L. 100–456, div. A, title III, Sec. 322(a), title VIII, Sec. 826(a), 832(a), Sept. 29, 1988, 102 

Stat. 1952, 2022, 2023; Pub. L. 100–463, title VIII, Sec. 8105(a), Oct. 1, 1988, 102 Stat. 2270– 

36; Pub. L. 100–526, title I, Sec. 106(a)(2), Oct. 24, 1988, 102 Stat. 2625; Pub. L. 100–700 Sec. 

8(b), Nov. 19, 1988, 102 Stat. 4636; Pub. L. 101–189, div. A, title III, Sec. 311(a)(1), title VIII, 

Sec. 853(a)(1), (b)(3), Nov. 29, 1989, 103 Stat. 1411, 1518; Pub. L. 101–510, div. A, title XIII, 

Sec. 1301(10), Nov. 5, 1990, 104 Stat. 1668; Pub. L. 102–190, div. A, title III, Sec. 346(a), Dec. 

5, 1991, 105 Stat. 1346; Pub. L. 102–484, div. A, title VIII, Sec. 818(a), title X, Sec. 1052(26), 

title XIII, Sec. 1352(b), Oct. 23, 1992, 106 Stat. 2457, 2500, 2559; Pub. L. 103–355, title II, Sec. 

2101(a)–(d), Oct. 13, 1994, 108 Stat. 3306–3308; Pub. L. 104–106, div. D, title XLIII, Sec. 

4321(a)(5), (b)(9), Feb. 10, 1996, 110 Stat. 671, 672; Pub. L. 105–85, div. A, title VIII, Sec. 

808(a), Nov. 18, 1997, 111 Stat. 1836; Pub. L. 105–261, div. A, title VIII, Sec. 804(a), Oct. 17, 

1998, 112 Stat. 2083; Pub. L. 111–350, Sec. 5(b)(19), Jan. 4, 2011, 124 Stat. 3844.) 
§ 2325 CH. 137—PROCUREMENT GENERALLY 1208 

§ 2325. Restructuring costs 

(a) LIMITATION ON PAYMENT OF RESTRUCTURING COSTS.—(1) 

The Secretary of Defense may not pay, under section 2324 of this 

title, a defense contractor for restructuring costs associated with a 

business combination of the contractor that occurs after November 

18, 1997, unless the Secretary determines in writing either— 

(A) that the amount of projected savings for the Department of Defense associated with the restructuring will be at 

least twice the amount of the costs allowed; or 

(B) that the amount of projected savings for the Department of Defense associated with the restructuring will exceed 

the amount of the costs allowed and that the business combination will result in the preservation of a critical capability 

that otherwise might be lost to the Department. 

(2) The Secretary may not delegate the authority to make a determination under paragraph (1), with respect to a business combination, to an official of the Department of Defense— 

(A) below the level of an Assistant Secretary of Defense for 

cases in which the amount of restructuring costs is expected to 

exceed $25,000,000 over a 5-year period; or 

(B) below the level of the Director of the Defense Contract 

Management Agency for all other cases. 

(b) REPORT.—Not later than March 1 in each of 1998, 1999, 

2000, 2001, and 2002, the Secretary of Defense shall submit to 

Congress a report that contains, with respect to business combinations occurring on or after August 15, 1994, the following: 

(1) For each defense contractor to which the Secretary has 

paid, under section 2324 of this title, restructuring costs associated with a business combination, a summary of the following: 

(A) An estimate of the amount of savings for the Department of Defense associated with the restructuring that 

has been realized as of the end of the preceding calendar 

year. 

(B) An estimate of the amount of savings for the Department of Defense associated with the restructuring that 

is expected to be achieved on defense contracts. 

(2) An identification of any business combination for which 

the Secretary has paid restructuring costs under section 2324 

of this title during the preceding calendar year and, for each 

such business combination— 

(A) the supporting rationale for allowing such costs; 

(B) factual information associated with the determination made under subsection (a) with respect to such costs; 

and 

(C) a discussion of whether the business combination 

would have proceeded without the payment of restructuring costs by the Secretary. 

(3) For business combinations of major defense contractors 

that took place during the year preceding the year of the 

report— 

(A) an assessment of any potentially adverse effects 

that the business combinations could have on competition 

for Department of Defense contracts (including potential 
1209 § 2326 CH. 137—PROCUREMENT GENERALLY 

horizontal effects, vertical effects, and organizational conflicts of interest), the national technology and industrial 

base, or innovation in the defense industry; and 

(B) the actions taken to mitigate the potentially adverse effects. 

(c) DEFINITION.—In this section, the term ‘‘business combination’’ includes a merger or acquisition. 

(Added Pub. L. 105–85, div. A, title VIII, Sec. 804(a)(1), Nov. 18, 1997, 111 Stat. 1832; amended 

Pub. L. 106–65, div. A, title X, Sec. 1066(a)(19), Oct. 5, 1999, 113 Stat. 771; Pub. L. 108–375, 

div. A, title VIII, Sec. 819, Oct. 28, 2004, 118 Stat. 2016.) 

§ 2326. Undefinitized contractual actions: restrictions 

(a) IN GENERAL.—The head of an agency may not enter into an 

undefinitized contractual action unless the request to the head of 

the agency for authorization of the contractual action includes a description of the anticipated effect on requirements of the military 

department concerned if a delay is incurred for purposes of determining contractual terms, specifications, and price before performance is begun under the contractual action. 

(b) LIMITATIONS ON OBLIGATION OF FUNDS.—(1) A contracting 

officer of the Department of Defense may not enter into an 

undefinitized contractual action unless the contractual action provides for agreement upon contractual terms, specifications, and 

price by the earlier of— 

(A) the end of the 180-day period beginning on the date on 

which the contractor submits a qualifying proposal to definitize 

the contractual terms, specifications, and price; or 

(B) the date on which the amount of funds obligated under 

the contractual action is equal to more than 50 percent of the 

negotiated overall ceiling price for the contractual action. 

(2) Except as provided in paragraph (3), the contracting officer 

for an undefinitized contractual action may not obligate with respect to such contractual action an amount that is equal to more 

than 50 percent of the negotiated overall ceiling price until the contractual terms, specifications, and price are definitized for such 

contractual action. 

(3) If a contractor submits a qualifying proposal (as defined in 

subsection (g)) to definitize an undefinitized contractual action before an amount equal to more than 50 percent of the negotiated 

overall ceiling price is obligated on such action, the contracting officer for such action may not obligate with respect to such contractual action an amount that is equal to more than 75 percent of the 

negotiated overall ceiling price until the contractual terms, specifications, and price are definitized for such contractual action. 

(4) The head of an agency may waive the provisions of this 

subsection with respect to a contract of that agency if that head of 

an agency determines that the waiver is necessary in order to support any of the following operations: 

(A) A contingency operation. 

(B) A humanitarian or peacekeeping operation. 

(5) This subsection does not apply to an undefinitized contractual action for the purchase of initial spares. 

(c) INCLUSION OF NON-URGENT REQUIREMENTS.—Requirements 

for spare parts and support equipment that are not needed on an 
§ 2327 CH. 137—PROCUREMENT GENERALLY 1210 

urgent basis may not be included in an undefinitized contractual 

action for spare parts and support equipment that are needed on 

an urgent basis unless the head of the agency approves such inclusion as being— 

(1) good business practice; and 

(2) in the best interests of the United States. 

(d) MODIFICATION OF SCOPE.—The scope of an undefinitized 

contractual action under which performance has begun may not be 

modified unless the head of the agency approves such modification 

as being— 

(1) good business practice; and 

(2) in the best interests of the United States. 

(e) ALLOWABLE PROFIT.—The head of an agency shall ensure 

that the profit allowed on an undefinitized contractual action for 

which the final price is negotiated after a substantial portion of the 

performance required is completed reflects— 

(1) the possible reduced cost risk of the contractor with respect to costs incurred during performance of the contract before the final price is negotiated; and 

(2) the reduced cost risk of the contractor with respect to 

costs incurred during performance of the remaining portion of 

the contract. 

(f) APPLICABILITY.—This section does not apply to the Coast 

Guard or the National Aeronautics and Space Administration. 

(g) DEFINITIONS.—In this section: 

(1) The term ‘‘undefinitized contractual action’’ means a 

new procurement action entered into by the head of an agency 

for which the contractual terms, specifications, or price are not 

agreed upon before performance is begun under the action. 

Such term does not include contractual actions with respect to 

the following: 

(A) Foreign military sales. 

(B) Purchases in an amount not in excess of the 

amount of the simplified acquisition threshold. 

(C) Special access programs. 

(D) Congressionally mandated long-lead procurement 

contracts. 

(2) The term ‘‘qualifying proposal’’ means a proposal that 

contains sufficient information to enable the Department of 

Defense to conduct complete and meaningful audits of the information contained in the proposal and of any other information that the Department is entitled to review in connection 

with the contract, as determined by the contracting officer. 

(Added Pub. L. 99–500, Sec. 101(c) [title X, Sec. 908(d)(1)(A)], Oct. 18, 1986, 100 Stat. 1783– 

82, 1783–140, and Pub. L. 99–591, Sec. 101(c) [title X, Sec. 908(d)(1)(A)], Oct. 30, 1986, 100 Stat. 

3341–82, 3341–140; Pub. L. 99–661, div. A, title IX, formerly title IV, Sec. 908(d)(1)(A), Nov. 

14, 1986, 100 Stat. 3920, renumbered title IX, Pub. L. 100–26, Sec. 3(5), Apr. 21, 1987, 101 Stat. 

273; amended Pub. L. 101–189, div. A, title XVI, Sec. 1622(c)(6), Nov. 29, 1989, 103 Stat. 1604; 

Pub. L. 102–25, title VII, Sec. 701(d)(5), Apr. 6, 1991, 105 Stat. 114; Pub. L. 103–355, title I, 

Sec. 1505, Oct. 13, 1994, 108 Stat. 3298; Pub. L. 105–85, div. A, title VIII, Sec. 803(a), Nov. 

18, 1997, 111 Stat. 1831.) 

§ 2327. Contracts: consideration of national security objectives 

(a) DISCLOSURE OF OWNERSHIP OR CONTROL BY A FOREIGN

GOVERNMENT.—The head of an agency shall require a firm or a 
1211 § 2327 CH. 137—PROCUREMENT GENERALLY 

subsidiary of a firm that submits a bid or proposal in response to 

a solicitation issued by the Department of Defense to disclose in 

that bid or proposal any significant interest in such firm or subsidiary (or, in the case of a subsidiary, in the firm that owns the 

subsidiary) that is owned or controlled (whether directly or indirectly) by a foreign government or an agent or instrumentality of 

a foreign government, if such foreign government is the government of a country that the Secretary of State determines under section 6(j)(1)(A) of the Export Administration Act of 1979 (50 U.S.C. 

App. 2405(j)(1)(A)) has repeatedly provided support for acts of 

international terrorism. 

(b) PROHIBITION ON ENTERING INTO CONTRACTS AGAINST THE

INTERESTS OF THE UNITED STATES.—Except as provided in subsection (c), the head of an agency may not enter into a contract 

with a firm or a subsidiary of a firm if— 

(1) a foreign government owns or controls (whether directly or indirectly) a significant interest in such firm or subsidiary (or, in the case of a subsidiary, in the firm that owns 

the subsidiary); and 

(2) such foreign government is the government of a country 

that the Secretary of State determines under section 6(j)(1)(A) 

of the Export Administration Act of 1979 (50 U.S.C. App. 

2405(j)(1)(A)) has repeatedly provided support for acts of international terrorism. 

(c) WAIVER.—(1)(A) If the Secretary of Defense determines 

under paragraph (2) that entering into a contract with a firm or 

a subsidiary of a firm described in subsection (b) is not inconsistent 

with the national security objectives of the United States, the head 

of an agency may enter into a contract with such firm or subsidiary 

if in the best interests of the Government. 

(B) The Secretary shall maintain records of each contract entered into by reason of subparagraph (A). Such records shall include the following: 

(i) The identity of the foreign government concerned. 

(ii) The nature of the contract. 

(iii) The extent of ownership or control of the firm or subsidiary concerned (or, if appropriate in the case of a subsidiary, 

of the firm that owns the subsidiary) by the foreign government concerned or the agency or instrumentality of such foreign government. 

(iv) The reasons for entering into the contract. 

(2) Upon the request of the head of an agency, the Secretary 

of Defense shall determine whether entering into a contract with 

a firm or subsidiary described in subsection (b) is inconsistent with 

the national security objectives of the United States. In making 

such a determination, the Secretary of Defense shall consider the 

following: 

(A) The relationship of the United States with the foreign 

government concerned. 

(B) The obligations of the United States under international agreements. 

(C) The extent of the ownership or control of the firm or 

subsidiary (or, if appropriate in the case of a subsidiary, of the 
§ 2327 CH. 137—PROCUREMENT GENERALLY 1212 

firm that owns the subsidiary) by the foreign government or an 

agent or instrumentality of the foreign government. 

(D) Whether payments made, or information made available, to the firm or subsidiary under the contract could be used 

for purposes hostile to the interests of the United States. 

(d) LIST OF FIRMS SUBJECT TO PROHIBITION.—(1) The Secretary 

of Defense shall develop and maintain a list of all firms and subsidiaries of firms that the Secretary has identified as being subject 

to the prohibition in subsection (b). 

(2)(A) A person may request the Secretary to include on the list 

maintained under paragraph (1) any firm or subsidiary of a firm 

that the person believes to be owned or controlled by a foreign government described in subsection (b)(2). Upon receipt of such a request, the Secretary shall determine whether the conditions in 

paragraphs (1) and (2) of subsection (b) exist in the case of that 

firm or subsidiary. If the Secretary determines that such conditions 

do exist, the Secretary shall include the firm or subsidiary on the 

list. 

(B) A firm or subsidiary of a firm included on the list may request the Secretary to remove such firm or subsidiary from the list 

on the basis that it has been erroneously included on the list or its 

ownership circumstances have significantly changed. Upon receipt 

of such a request, the Secretary shall determine whether the conditions in paragraphs (1) and (2) of subsection (b) exist in the case 

of that firm or subsidiary. If the Secretary determines that such 

conditions do not exist, the Secretary shall remove the firm or subsidiary from the list. 

(C) The Secretary shall establish procedures to carry out this 

paragraph. (3) The head of an agency shall prohibit each firm or 

subsidiary of a firm awarded a contract by the agency from entering into a subcontract under that contract in an amount in excess 

of $25,000 with a firm or subsidiary included on the list maintained under paragraph (1) unless there is a compelling reason to 

do so. In the case of any subcontract requiring consent by the head 

of an agency, the head of the agency shall not consent to the award 

of the subcontract to a firm or subsidiary included on such list unless there is a compelling reason for such approval. 

(e) DISTRIBUTION OF LIST.—The Administrator of General Services shall ensure that the list developed and maintained under subsection (d) is made available to Federal agencies and the public in 

the same manner and to the same extent as the list of suspended 

and debarred contractors compiled pursuant to subpart 9.4 of the 

Federal Acquisition Regulation. 

(f) APPLICABILITY.—(1) This section does not apply to a contract for an amount less than $100,000. 

(2) This section does not apply to the Coast Guard or the National Aeronautics and Space Administration. 

(g) REGULATIONS.—The Secretary of Defense, after consultation 

with the Secretary of State, shall prescribe regulations to carry out 

this section. Such regulations shall include a definition of the term 

‘‘significant interest’’. 

(Added Pub. L. 99–500, Sec. 101(c) [title X, Sec. 951(a)(1)], Oct. 18, 1986, 100 Stat. 1783–82, 

1783–164, and Pub. L. 99–591, Sec. 101(c) [title X, Sec. 951(a)(1)], Oct. 30, 1986, 100 Stat. 3341– 

82, 3341–164; Pub. L. 99–661, div. A, title IX, formerly title IV, Sec. 951(a)(1), Nov. 14, 1986, 

100 Stat. 3944, renumbered title IX, Pub. L. 100–26, Sec. 3(5), Apr. 21, 1987, 101 Stat. 273; 
1213 § 2330 CH. 137—PROCUREMENT GENERALLY 

amended Pub. L. 100–180, div. A, title XII, Sec. 1231(8), Dec. 4, 1987, 101 Stat. 1160; Pub. L. 

100–224, Sec. 5(b)(2), Dec. 30, 1987, 101 Stat. 1538; Pub. L. 105–85, div. A, title VIII, Sec. 843, 

Nov. 18, 1997, 111 Stat. 1844; Pub. L. 108–136, div. A, title X, Sec. 1031(a)(16), Nov. 24, 2003, 

117 Stat. 1597.) 

§ 2328. Release of technical data under Freedom of Information Act: recovery of costs 

(a) IN GENERAL.—(1) The Secretary of Defense shall, if required to release technical data under section 552 of title 5 (relating to the Freedom of Information Act), release such technical data 

to the person requesting the release if the person pays all reasonable costs attributable to search, duplication, and review. 

(2) The Secretary of Defense shall prescribe regulations, pursuant to notice and receipt of public comment, specifying a uniform 

schedule of fees under this section. 

(b) CREDITING OF RECEIPTS.—An amount received under this 

section— 

(1) shall be retained by the Department of Defense or the 

element of the Department of Defense receiving the amount; 

and 

(2) shall be merged with and available for the same purpose and the same time period as the appropriation from which 

the costs incurred in complying with requests for technical 

data were paid. 

(c) WAIVER.—The Secretary of Defense shall waive the payment of costs required by subsection (a) which are in an amount 

greater than the costs that would be required for such a release of 

information under section 552 of title 5 if— 

(1) the request is made by a citizen of the United States 

or a United States corporation, and such citizen or corporation 

certifies that the technical data requested is required to enable 

such citizen or corporation to submit an offer or determine 

whether it is capable of submitting an offer to provide the 

product to which the technical data relates to the United 

States or a contractor with the United States (except that the 

Secretary may require the citizen or corporation to pay a deposit in an amount equal to not more than the cost of complying with the request, to be refunded upon submission of an 

offer by the citizen or corporation); 

(2) the release of technical data is requested in order to 

comply with the terms of an international agreement; or 

(3) the Secretary determines, in accordance with section 

552(a)(4)(A)(iii) of title 5, that such a waiver is in the interests 

of the United States. 

(Added Pub. L. 99–500, Sec. 101(c) [title X, Sec. 954(a)(1)], Oct. 18, 1986, 100 Stat. 1783–82, 

1783–172, and Pub. L. 99–591, Sec. 101(c) [title X, Sec. 954(a)(1)], Oct. 30, 1986, 100 Stat. 3341– 

82, 3341–172; Pub. L. 99–661, div. A, title IX, formerly title IV, Sec. 954(a)(1), Nov. 14, 1986, 

100 Stat. 3952, renumbered title IX, Pub. L. 100–26, Sec. 3(5), Apr. 21, 1987, 101 Stat. 273; 

amended Pub. L. 100–26, Sec. 7(a)(7)(A), (B)(i), Apr. 21, 1987, 101 Stat. 278.) 

[§ 2329. Repealed. Pub. L. 103–355, title I, Sec. 1506(a), Oct. 

13, 1994, 108 Stat. 3298] 

§ 2330. Procurement of contract services: management 

structure 

(a) REQUIREMENT FOR MANAGEMENT STRUCTURE.—The Secretary of Defense shall establish and implement a management 
§ 2330 CH. 137—PROCUREMENT GENERALLY 1214 

structure for the procurement of contract services for the Department of Defense. The management structure shall provide, at a 

minimum, for the following: 

(1) The Under Secretary of Defense for Acquisition, Technology, and Logistics shall— 

(A) develop and maintain (in consultation with the 

service acquisition executives) policies, procedures, and 

best practices guidelines addressing the procurement of 

contract services, including policies, procedures, and best 

practices guidelines for— 

(i) acquisition planning; 

(ii) solicitation and contract award; 

(iii) requirements development and management; 

(iv) contract tracking and oversight; 

(v) performance evaluation; and 

(vi) risk management; 

(B) work with the service acquisition executives and 

other appropriate officials of the Department of Defense— 

(i) to identify the critical skills and competencies 

needed to carry out the procurement of contract services on behalf of the Department of Defense; 

(ii) to develop a comprehensive strategy for recruiting, training, and deploying employees to meet 

the requirements for such skills and competencies; and 

(iii) to ensure that the military departments and 

Defense Agencies have staff and administrative support that are adequate to effectively perform their duties under this section; 

(C) establish contract services acquisition categories, 

based on dollar thresholds, for the purpose of establishing 

the level of review, decision authority, and applicable procedures in such categories; and 

(D) oversee the implementation of the requirements of 

this section and the policies, procedures, and best practices 

guidelines established pursuant to subparagraph (A). 

(2) The service acquisition executive of each military department shall be the senior official responsible for the management of acquisition of contract services for or on behalf of 

the military department. 

(3) The Under Secretary of Defense for Acquisition, Technology, and Logistics shall be the senior official responsible for 

the management of acquisition of contract services for or on behalf of the Defense Agencies and other components of the Department of Defense outside the military departments. 

(b) DUTIES AND RESPONSIBILITIES OF SENIOR OFFICIALS RESPONSIBLE FOR THE MANAGEMENT OF ACQUISITION OF CONTRACT

SERVICES.—(1) Except as provided in paragraph (2), the senior officials responsible for the management of acquisition of contract 

services shall assign responsibility for the review and approval of 

procurements in each contract services acquisition category established under subsection (a)(1)(C) to specific Department of Defense 

officials, subject to the direction, supervision, and oversight of such 

senior officials. 
1215 § 2330 CH. 137—PROCUREMENT GENERALLY 

(2) With respect to the acquisition of contract services by a 

component or command of the Department of Defense the primary 

mission of which is the acquisition of products and services, such 

acquisition shall be conducted in accordance with policies, procedures, and best practices guidelines developed and maintained by 

the Under Secretary of Defense for Acquisition, Technology, and 

Logistics pursuant to subsection (a)(1), subject to oversight by the 

senior officials referred to in paragraph (1). 

(3) In carrying out paragraph (1), each senior official responsible for the management of acquisition of contract services shall— 

(A) implement the requirements of this section and the 

policies, procedures, and best practices guidelines developed by 

the Under Secretary of Defense for Acquisition, Technology, 

and Logistics pursuant to subsection (a)(1)(A); 

(B) authorize the procurement of contract services through 

contracts entered into by agencies outside the Department of 

Defense in appropriate circumstances, in accordance with the 

requirements of section 854 of the Ronald W. Reagan National 

Defense Authorization Act for Fiscal Year 2005 (10 U.S.C. 2304 

note), section 814 of the Strom Thurmond National Defense 

Authorization Act for Fiscal Year 1999 (31 U.S.C. 1535 note), 

and the regulations implementing such sections; 

(C) dedicate full-time commodity managers to coordinate 

the procurement of key categories of services; 

(D) ensure that contract services are procured by means of 

procurement actions that are in the best interests of the Department of Defense and are entered into and managed in compliance with applicable laws, regulations, directives, and requirements; 

(E) ensure that competitive procedures and performancebased contracting are used to the maximum extent practicable 

for the procurement of contract services; and 

(F) monitor data collection under section 2330a of this 

title, and periodically conduct spending analyses, to ensure 

that funds expended for the procurement of contract services 

are being expended in the most rational and economical manner practicable. 

(c) DEFINITIONS.—In this section: 

(1) The term ‘‘procurement action’’ includes the following 

actions: 

(A) Entry into a contract or any other form of agreement. 

(B) Issuance of a task order, delivery order, or military 

interdepartmental purchase request. 

(2) The term ‘‘contract services’’ includes all services acquired from private sector entities by or for the Department of 

Defense, other than services relating to research and development or military construction. 

(Added Pub. L. 107–107, div. A, title VIII, Sec. 801(b)(1), Dec. 28, 2001, 115 Stat. 1174; amended 

Pub. L. 107–314, div. A, title X, Sec. 1062(a)(8), Dec. 2, 2002, 116 Stat. 2650; Pub. L. 109–163, 

div. A, title VIII, Sec. 812(a)(1), Jan. 6, 2006, 119 Stat. 3376.) 
§ 2330a CH. 137—PROCUREMENT GENERALLY 1216 

§ 2330a. Procurement of services: tracking of purchases 

(a) DATA COLLECTION REQUIRED.—The Secretary of Defense 

shall establish a data collection system to provide management information with regard to each purchase of services by a military 

department or Defense Agency in excess of the simplified acquisition threshold, regardless of whether such a purchase is made in 

the form of a contract, task order, delivery order, military interdepartmental purchase request, or any other form of interagency 

agreement. 

(b) DATA TO BE COLLECTED.—The data required to be collected 

under subsection (a) includes the following: 

(1) The services purchased. 

(2) The total dollar amount of the purchase. 

(3) The form of contracting action used to make the purchase. 

(4) Whether the purchase was made through— 

(A) a performance-based contract, performance-based 

task order, or other performance-based arrangement that 

contains firm fixed prices for the specific tasks to be performed; 

(B) any other performance-based contract, performance-based task order, or performance-based arrangement; 

or 

(C) any contract, task order, or other arrangement 

that is not performance based. 

(5) In the case of a purchase made through an agency 

other than the Department of Defense, the agency through 

which the purchase is made. 

(6) The extent of competition provided in making the purchase and whether there was more than one offer. 

(7) Whether the purchase was made from— 

(A) a small business concern; 

(B) a small business concern owned and controlled by 

socially and economically disadvantaged individuals; or 

(C) a small business concern owned and controlled by 

women. 

(c) INVENTORY.—(1) Not later than the end of the third quarter 

of each fiscal year, the Secretary of Defense shall submit to Congress an annual inventory of the activities performed during the 

preceding fiscal year pursuant to contracts for services for or on behalf of the Department of Defense. The guidance for compiling the 

inventory shall be issued by the Under Secretary of Defense for 

Personnel and Readiness, the Under Secretary of Defense (Comptroller), and the Under Secretary of Defense for Acquisition, Technology, and Logistics, as follows: 

(A) The Under Secretary of Defense for Personnel and 

Readiness, as supported by the Under Secretary of Defense 

(Comptroller), shall be responsible for developing guidance 

for— 

(i) the collection of data regarding functions and missions performed by contractors in a manner that is comparable to the manpower data elements used in inven-
1217 § 2330a CH. 137—PROCUREMENT GENERALLY 

tories of functions performed by Department of Defense 

employees; and 

(ii) the calculation of contractor manpower equivalents 

in a manner that is comparable to the calculation of fulltime equivalents for use in inventories of functions performed by Department of Defense employees. 

(B) The Under Secretary of Defense for Acquisition, Technology, and Logistics shall be responsible for developing guidance on other data elements and implementing procedures. 

(2) The entry for an activity on an inventory under this subsection shall include, for the fiscal year covered by such entry, the 

following: 

(A) The functions and missions performed by the contractor. 

(B) The contracting organization, the component of the Department of Defense administering the contract, and the organization whose requirements are being met through contractor 

performance of the function. 

(C) The funding source for the contract under which the 

function is performed by appropriation and operating agency. 

(D) The fiscal year for which the activity first appeared on 

an inventory under this section. 

(E) The number of contractor employees, expressed as fulltime equivalents for direct labor, using direct labor hours and 

associated cost data collected from contractors (except that estimates may be used where such data is not available and cannot reasonably be made available in a timely manner for the 

purpose of the inventory). 

(F) A determination whether the contract pursuant to 

which the activity is performed is a personal services contract. 

(G) A summary of the data required to be collected for the 

activity under subsection (a). 

(3) The inventory required under this subsection shall be submitted in unclassified form, but may include a classified annex. 

(d) PUBLIC AVAILABILITY OF INVENTORIES.—Not later than 30 

days after the date on which an inventory under subsection (c) is 

required to be submitted to Congress, the Secretary shall— 

(1) make the inventory available to the public; and 

(2) publish in the Federal Register a notice that the inventory is available to the public. 

(e) REVIEW AND PLANNING REQUIREMENTS.—Within 90 days 

after the date on which an inventory is submitted under subsection 

(c), the Secretary of the military department or head of the Defense 

Agency responsible for activities in the inventory shall— 

(1) review the contracts and activities in the inventory for 

which such Secretary or agency head is responsible; 

(2) ensure that— 

(A) each contract on the list that is a personal services 

contract has been entered into, and is being performed, in 

accordance with applicable statutory and regulatory requirements; 

(B) the activities on the list do not include any inherently governmental functions; and 
§ 2330a CH. 137—PROCUREMENT GENERALLY 1218 

(C) to the maximum extent practicable, the activities 

on the list do not include any functions closely associated 

with inherently governmental functions; 

(3) identify activities that should be considered for conversion— 

(A) to performance by civilian employees of the Department of Defense pursuant to section 2463 of this title; 

or 

(B) to an acquisition approach that would be more advantageous to the Department of Defense; and 

(4) develop a plan, including an enforcement mechanism 

and approval process, to provide for appropriate consideration 

of the conversion of activities identified under paragraph (3) 

within a reasonable period of time. 

(f) RULE OF CONSTRUCTION.—Nothing in this section shall be 

construed to authorize the performance of personal services by a 

contractor except where expressly authorized by a provision of law 

other than this section. 

(g) DEFINITIONS.—In this section: 

(1) The term ‘‘performance-based’’, with respect to a contract, task order, or arrangement, means that the contract, 

task order, or arrangement, respectively, includes the use of 

performance work statements that set forth contract requirements in clear, specific, and objective terms with measurable 

outcomes. 

(2) The definitions set forth in section 2225(f) of this title 

for the terms ‘‘simplified acquisition threshold’’, ‘‘small business concern’’, ‘‘small business concern owned and controlled by 

socially and economically disadvantaged individuals’’, and 

‘‘small business concern owned and controlled by women’’ shall 

apply. 

(3) FUNCTION CLOSELY ASSOCIATED WITH INHERENTLY GOVERNMENTAL FUNCTIONS.—The term ‘‘function closely associated 

with inherently governmental functions’’ has the meaning 

given that term in section 2383(b)(3) of this title. 

(4) INHERENTLY GOVERNMENTAL FUNCTIONS.—The term 

‘‘inherently governmental functions’’ has the meaning given 

that term in section 2383(b)(2) of this title. 

(5) PERSONAL SERVICES CONTRACT.—The term ‘‘personal 

services contract’’ means a contract under which, as a result of 

its terms or conditions or the manner of its administration during performance, contractor personnel are subject to the relatively continuous supervision and control of one or more Government officers or employees, except that the giving of an 

order for a specific article or service, with the right to reject 

the finished product or result, is not the type of supervision or 

control that makes a contract a personal services contract. 

(Added Pub. L. 107–107, div. A, title VIII, Sec. 801(c), Dec. 28, 2001, 115 Stat. 1176; amended 

Pub. L. 110–181, div. A, title VIII, Sec. 807(a), Jan. 28, 2008, 122 Stat. 213; Pub. L. 111–84, 

div. A, title VIII, Sec. 803(b), Oct. 28, 2009, 123 Stat. 2402; Pub. L. 111–383, div. A, title III, 

Sec. 321, Jan. 7, 2011, 124 Stat. 4183.) 
1219 § 2332 CH. 137—PROCUREMENT GENERALLY 

§ 2331. Procurement of services: contracts for professional 

and technical services 

(a) IN GENERAL.—The Secretary of Defense shall prescribe regulations to ensure, to the maximum extent practicable, that professional and technical services are acquired on the basis of the task 

to be performed rather than on the basis of the number of hours 

of services provided. 

(b) CONTENT OF REGULATIONS.—With respect to contracts to 

acquire services on the basis of the number of hours of services provided, the regulations described in subsection (a) shall— 

(1) include standards and approval procedures to minimize 

the use of such contracts; 

(2) establish criteria to ensure that proposals for contracts 

for technical and professional services are evaluated on a basis 

which does not encourage contractors to propose uncompensated overtime; 

(3) ensure appropriate emphasis on technical and quality 

factors in the source selection process; 

(4) require identification of any hours in excess of 40-hour 

weeks included in a proposal; 

(5) ensure that offerors are notified that proposals which 

include unrealistically low labor rates or which do not otherwise demonstrate cost realism will be considered in a risk assessment and evaluated appropriately; and 

(6) provide guidance to contracting officers to ensure that 

any use of uncompensated overtime will not degrade the level 

of technical expertise required to perform the contract. 

(Added Pub. L. 101–510, div. A, title VIII, Sec. 834(a)(1), Nov. 5, 1990, 104 Stat. 1613; amended 

Pub. L. 102–25, title VII, Sec. 701(a), Apr. 6, 1991, 105 Stat. 113; Pub. L. 103–355, title I, Sec. 

1004(c), Oct. 13, 1994, 108 Stat. 3253; Pub. L. 107–107, div. A, title VIII, Sec. 801(g)(1), Dec. 

28, 2001, 115 Stat. 1177.) 

§ 2332. Share-in-savings contracts 

(a) AUTHORITY TO ENTER INTO SHARE-IN-SAVINGS CONTRACTS.—(1) The head of an agency may enter into a share-in-savings contract for information technology (as defined in section 

11101(6) of title 40) in which the Government awards a contract to 

improve mission-related or administrative processes or to accelerate the achievement of its mission and share with the contractor 

in savings achieved through contract performance. 

(2)(A) Except as provided in subparagraph (B), a share-in-savings contract shall be awarded for a period of not more than five 

years. 

(B) A share-in-savings contract may be awarded for a period 

greater than five years, but not more than 10 years, if the head of 

the agency determines in writing prior to award of the contract 

that— 

(i) the level of risk to be assumed and the investment to 

be undertaken by the contractor is likely to inhibit the government from obtaining the needed information technology competitively at a fair and reasonable price if the contract is limited in duration to a period of five years or less; and 
§ 2332 CH. 137—PROCUREMENT GENERALLY 1220 

(ii) usage of the information technology to be acquired is 

likely to continue for a period of time sufficient to generate 

reasonable benefit for the government. 

(3) Contracts awarded pursuant to the authority of this section 

shall, to the maximum extent practicable, be performance-based 

contracts that identify objective outcomes and contain performance 

standards that will be used to measure achievement and milestones that must be met before payment is made. 

(4) Contracts awarded pursuant to the authority of this section 

shall include a provision containing a quantifiable baseline that is 

to be the basis upon which a savings share ratio is established that 

governs the amount of payment a contractor is to receive under the 

contract. Before commencement of performance of such a contract, 

the senior procurement executive of the agency shall determine in 

writing that the terms of the provision are quantifiable and will 

likely yield value to the Government. 

(5)(A) The head of the agency may retain savings realized 

through the use of a share-in-savings contract under this section 

that are in excess of the total amount of savings paid to the contractor under the contract, but may not retain any portion of such 

savings that is attributable to a decrease in the number of civilian 

employees of the Federal Government performing the function. Except as provided in subparagraph (B), savings shall be credited to 

the appropriation or fund against which charges were made to 

carry out the contract and shall be used for information technology. 

(B) Amounts retained by the agency under this subsection 

shall— 

(i) without further appropriation, remain available until 

expended; and 

(ii) be applied first to fund any contingent liabilities associated with share-in-savings procurements that are not fully 

funded. 

(b) CANCELLATION AND TERMINATION.—(1) If funds are not 

made available for the continuation of a share-in-savings contract 

entered into under this section in a subsequent fiscal year, the contract shall be canceled or terminated. The costs of cancellation or 

termination may be paid out of— 

(A) appropriations available for the performance of the 

contract; 

(B) appropriations available for acquisition of the information technology procured under the contract, and not otherwise 

obligated; or 

(C) funds subsequently appropriated for payments of costs 

of cancellation or termination, subject to the limitations in 

paragraph (3). 

(2) The amount payable in the event of cancellation or termination of a share-in-savings contract shall be negotiated with the 

contractor at the time the contract is entered into. 

(3)(A) Subject to subparagraph (B), the head of an agency may 

enter into share-in-savings contracts under this section in any 

given fiscal year even if funds are not made specifically available 

for the full costs of cancellation or termination of the contract if 

funds are available and sufficient to make payments with respect 

to the first fiscal year of the contract and the following conditions 
1221 § 2333 CH. 137—PROCUREMENT GENERALLY 

are met regarding the funding of cancellation and termination liability: 

(i) The amount of unfunded contingent liability for the contract does not exceed the lesser of— 

(I) 25 percent of the estimated costs of a cancellation 

or termination; or 

(II) $5,000,000. 

(ii) Unfunded contingent liability in excess of $1,000,000 

has been approved by the Director of the Office of Management 

and Budget or the Director’s designee. 

(B) The aggregate number of share-in-savings contracts that 

may be entered into under subparagraph (A) by all agencies to 

which this chapter applies in a fiscal year may not exceed 5 in each 

of fiscal years 2003, 2004, and 2005. 

(c) DEFINITIONS.—In this section: 

(1) The term ‘‘contractor’’ means a private entity that enters into a contract with an agency. 

(2) The term ‘‘savings’’ means— 

(A) monetary savings to an agency; or 

(B) savings in time or other benefits realized by the 

agency, including enhanced revenues (other than enhanced 

revenues from the collection of fees, taxes, debts, claims, or 

other amounts owed the Federal Government). 

(3) The term ‘‘share-in-savings contract’’ means a contract 

under which— 

(A) a contractor provides solutions for— 

(i) improving the agency’s mission-related or administrative processes; or 

(ii) accelerating the achievement of agency missions; and 

(B) the head of the agency pays the contractor an 

amount equal to a portion of the savings derived by the 

agency from— 

(i) any improvements in mission-related or administrative processes that result from implementation of 

the solution; or 

(ii) acceleration of achievement of agency missions. 

(d) TERMINATION.—No share-in-savings contracts may be entered into under this section after September 30, 2005. 

(Added Pub. L. 107–347, title II, Sec. 210(a)(1), Dec. 17, 2002, 116 Stat. 2932.) 

§ 2333. Joint policies on requirements definition, contingency program management, and contingency contracting 

(a) JOINT POLICY REQUIREMENT.—The Secretary of Defense, in 

consultation with the Chairman of the Joint Chiefs of Staff, shall 

develop joint policies for requirements definition, contingency program management, and contingency contracting during combat operations and post-conflict operations. 

(b) REQUIREMENTS DEFINITION MATTERS COVERED.—The joint 

policy for requirements definition required by subsection (a) shall, 

at a minimum, provide for the following: 
§ 2333 CH. 137—PROCUREMENT GENERALLY 1222 

(1) The assignment of a senior commissioned officer or civilian member of the senior executive service, with appropriate 

experience and qualifications related to the definition of requirements to be satisfied through acquisition contracts (such 

as for delivery of products or services, performance of work, or 

accomplishment of a project), to act as head of requirements 

definition and coordination during combat operations, post-conflict operations, and contingency operations, if required, including leading a requirements review board involving all organizations concerned. 

(2) An organizational approach to requirements definition 

and coordination during combat operations, post-conflict operations, and contingency operations that is designed to ensure 

that requirements are defined in a way that effectively implements United States Government and Department of Defense 

objectives, policies, and decisions regarding the allocation of resources, coordination of interagency efforts in the theater of operations, and alignment of requirements with the proper use of 

funds. 

(c) CONTINGENCY PROGRAM MANAGEMENT MATTERS COVERED.—The joint policy for contingency program management required by subsection (a) shall, at a minimum, provide for the following: 

(1) The assignment of a senior commissioned officer or civilian member of the senior executive service, with appropriate 

program management experience and qualifications, to act as 

head of program management during combat operations, postconflict operations, and contingency operations, including stabilization and reconstruction operations involving multiple 

United States Government agencies and international organizations, if required. 

(2) A preplanned organizational approach to program management during combat operations, post-conflict operations, 

and contingency operations that is designed to ensure that the 

Department of Defense is prepared to conduct such program 

management. 

(3) Identification of a deployable cadre of experts, with the 

appropriate tools and authority, and trained in processes under 

paragraph (6). 

(4) Utilization of the hiring and appointment authorities 

necessary for the rapid deployment of personnel to ensure the 

availability of key personnel for sufficient lengths of time to 

provide for continuing program and project management. 

(5) A requirement to provide training (including training 

under a program to be created by the Defense Acquisition University) to program management personnel in— 

(A) the use of laws, regulations, policies, and directives 

related to program management in combat or contingency 

environments; 

(B) the integration of cost, schedule, and performance 

objectives into practical acquisition strategies aligned with 

available resources and subject to effective oversight; and 
1223 § 2333 CH. 137—PROCUREMENT GENERALLY 

(C) procedures of the Department of Defense related to 

funding mechanisms and contingency contract management. 

(6) Appropriate steps to ensure that training is maintained 

for such personnel even when they are not deployed in a contingency operation. 

(7) Such steps as may be needed to ensure jointness and 

cross-service coordination in the area of program management 

during contingency operations. 

(d) CONTINGENCY CONTRACTING MATTERS COVERED.—(1) The 

joint policy for contingency contracting required by subsection (a) 

shall, at a minimum, provide for the following: 

(A) The designation of a senior commissioned officer or civilian member of the senior executive service in each military 

department with the responsibility for administering the policy. 

(B) The assignment of a senior commissioned officer with 

appropriate acquisition experience and qualifications to act as 

head of contingency contracting during combat operations, 

post-conflict operations, and contingency operations, who shall 

report directly to the commander of the combatant command in 

whose area of responsibility the operations occur. 

(C) A sourcing approach to contingency contracting that is 

designed to ensure that each military department is prepared 

to conduct contingency contracting during combat operations, 

post-conflict operations, and contingency operations, including 

stabilization and reconstruction operations involving interagency organizations, if required. 

(D) A requirement to provide training (including training 

under a program to be created by the Defense Acquisition University) to contingency contracting personnel in— 

(i) the use of law, regulations, policies, and directives 

related to contingency contracting operations; 

(ii) the appropriate use of rapid acquisition methods, 

including the use of exceptions to competition requirements under section 2304 of this title, sealed bidding, letter contracts, indefinite delivery-indefinite quantity task 

orders, set asides under section 8(a) of the Small Business 

Act (15 U.S.C. 637(a)), undefinitized contract actions, and 

other tools available to expedite the delivery of goods and 

services during combat operations or post-conflict operations; 

(iii) the appropriate use of rapid acquisition authority, 

commanders’ emergency response program funds, and 

other tools unique to contingency contracting; and 

(iv) instruction on the necessity for the prompt transition from the use of rapid acquisition authority to the use 

of full and open competition and other methods of contracting that maximize transparency in the acquisition 

process. 

(E) Appropriate steps to ensure that training is maintained for such personnel even when they are not deployed in 

a contingency operation. 
§ 2333 CH. 137—PROCUREMENT GENERALLY 1224 

(F) Such steps as may be needed to ensure jointness and 

cross-service coordination in the area of contingency contracting. 

(2) To the extent practicable, the joint policy for contingency 

contracting required by subsection (a) should be taken into account 

in the development of interagency plans for stabilization and reconstruction operations, consistent with the report submitted by the 

President under section 1035 of the John Warner National Defense 

Authorization Act for Fiscal Year 2007 (Public Law 109–364; 120 

Stat. 2388) on interagency operating procedures for the planning 

and conduct of stabilization and reconstruction operations. 

(e) TRAINING FOR PERSONNEL OUTSIDE ACQUISITION WORK- FORCE.—(1) The joint policy for requirements definition, contingency program management, and contingency contracting required 

by subsection (a) shall provide for training of military personnel 

outside the acquisition workforce (including operational field commanders and officers performing key staff functions for operational 

field commanders) who are expected to have acquisition responsibility, including oversight duties associated with contracts or contractors, during combat operations, post-conflict operations, and 

contingency operations. 

(2) Training under paragraph (1) shall be sufficient to ensure 

that the military personnel referred to in that paragraph understand the scope and scale of contractor support they will experience 

in contingency operations and are prepared for their roles and responsibilities with regard to requirements definition, program management (including contractor oversight), and contingency contracting. 

(3) The joint policy shall also provide for the incorporation of 

contractors and contract operations in mission readiness exercises 

for operations that will include contracting and contractor support. 

(f) DEFINITIONS.—In this section: 

(1) CONTINGENCY CONTRACTING PERSONNEL.—The term 

‘‘contingency contracting personnel’’ means members of the 

armed forces and civilian employees of the Department of Defense who are members of the defense acquisition workforce 

and, as part of their duties, are assigned to provide support to 

contingency operations (whether deployed or not). 

(2) CONTINGENCY CONTRACTING.—The term ‘‘contingency 

contracting’’ means all stages of the process of acquiring property or services by the Department of Defense during a contingency operation. 

(3) CONTINGENCY OPERATION.—The term ‘‘contingency operation’’ has the meaning provided in section 101(a)(13) of this 

title. 

(4) ACQUISITION SUPPORT AGENCIES.—The term ‘‘acquisition support agencies’’ means Defense Agencies and Department of Defense Field Activities that carry out and provide 

support for acquisition-related activities. 

(5) CONTINGENCY PROGRAM MANAGEMENT.—The term ‘‘contingency program management’’ means the process of planning, 

organizing, staffing, controlling, and leading the combined efforts of participating civilian and military personnel and organizations for the management of a specific defense acquisition 
1225 § 2334 CH. 137—PROCUREMENT GENERALLY 

program or programs during combat operations, post-conflict 

operations, and contingency operations. 

(6) REQUIREMENTS DEFINITION.—The term ‘‘requirements 

definition’’ means the process of translating policy objectives 

and mission needs into specific requirements, the description of 

which will be the basis for awarding acquisition contracts for 

projects to be accomplished, work to be performed, or products 

to be delivered. 

(Added Pub. L. 109–364, div. A, title VIII, Sec. 854(a)(1), Oct. 17, 2006, 120 Stat. 2343; amended 

Pub. L. 110–181, div. A, title VIII, Sec. 849(a), Jan. 28, 2008, 122 Stat. 245; Pub. L. 111–84, 

div. A, title X, Sec. 1073(a)(23), Oct. 28, 2009, 123 Stat. 2473.) 

§ 2334. Independent cost estimation and cost analysis 

(a) IN GENERAL.—The Director of Cost Assessment and Program Evaluation shall ensure that the cost estimation and cost 

analysis processes of the Department of Defense provide accurate 

information and realistic estimates of cost for the acquisition programs of the Department of Defense. In carrying out that responsibility, the Director shall— 

(1) prescribe, by authority of the Secretary of Defense, policies and procedures for the conduct of cost estimation and cost 

analysis for the acquisition programs of the Department of 

Defense; 

(2) provide guidance to and consult with the Secretary of 

Defense, the Under Secretary of Defense for Acquisition, Technology, and Logistics, the Under Secretary of Defense (Comptroller), the Secretaries of the military departments, and the 

heads of the Defense Agencies with respect to cost estimation 

in the Department of Defense in general and with respect to 

specific cost estimates and cost analyses to be conducted in 

connection with a major defense acquisition program under 

chapter 144 of this title or a major automated information system program under chapter 144A of this title; 

(3) issue guidance relating to the proper selection of confidence levels in cost estimates generally, and specifically, for 

the proper selection of confidence levels in cost estimates for 

major defense acquisition programs and major automated information system programs; 

(4) issue guidance relating to full consideration of life-cycle 

management and sustainability costs in major defense acquisition programs and major automated information system programs; 

(5) review all cost estimates and cost analyses conducted 

in connection with major defense acquisition programs and 

major automated information system programs; 

(6) conduct independent cost estimates and cost analyses 

for major defense acquisition programs and major automated 

information system programs for which the Under Secretary of 

Defense for Acquisition, Technology, and Logistics is the Milestone Decision Authority— 

(A) in advance of— 

(i) any certification under section 2366a or 2366b 

of this title; 

(ii) any decision to enter into low-rate initial production or full-rate production; 
§ 2334 CH. 137—PROCUREMENT GENERALLY 1226 

(iii) any certification under section 2433a of this 

title; and 

(iv) any report under section 2445c(f) of this title; 

and 

(B) at any other time considered appropriate by the 

Director or upon the request of the Under Secretary of Defense for Acquisition, Technology, and Logistics; and 

(7) periodically assess and update the cost indexes used by 

the Department to ensure that such indexes have a sound 

basis and meet the Department’s needs for realistic cost estimation. 

(b) REVIEW OF COST ESTIMATES, COST ANALYSES, AND RECORDS

OF THE MILITARY DEPARTMENTS AND DEFENSE AGENCIES.—The 

Secretary of Defense shall ensure that the Director of Cost Assessment and Program Evaluation— 

(1) promptly receives the results of all cost estimates and 

cost analyses conducted by the military departments and Defense Agencies, and all studies conducted by the military departments and Defense Agencies in connection with such cost 

estimates and cost analyses, for major defense acquisition programs and major automated information system programs of 

the military departments and Defense Agencies; and 

(2) has timely access to any records and data in the Department of Defense (including the records and data of each 

military department and Defense Agency and including classified and proprietary information) that the Director considers 

necessary to review in order to carry out any duties under this 

section. 

(c) PARTICIPATION, CONCURRENCE, AND APPROVAL IN COST ESTIMATION.—The Director of Cost Assessment and Program Evaluation may— 

(1) participate in the discussion of any discrepancies between an independent cost estimate and the cost estimate of 

a military department or Defense Agency for a major defense 

acquisition program or major automated information system 

program of the Department of Defense; 

(2) comment on deficiencies in the methodology or execution of any cost estimate or cost analysis developed by a military department or Defense Agency for a major defense acquisition program or major automated information system program; 

(3) concur in the choice of a cost estimate within the baseline description or any other cost estimate (including the confidence level for any such cost estimate) for use at any event 

specified in subsection (a)(6); and 

(4) participate in the consideration of any decision to request authorization of a multiyear procurement contract for a 

major defense acquisition program. 

(d) DISCLOSURE OF CONFIDENCE LEVELS FOR BASELINE ESTIMATES OF MAJOR DEFENSE ACQUISITION PROGRAMS.—The Director 

of Cost Assessment and Program Evaluation, and the Secretary of 

the military department concerned or the head of the Defense 

Agency concerned (as applicable), shall each— 
1227 § 2334 CH. 137—PROCUREMENT GENERALLY 

(1) disclose in accordance with paragraph (3) the confidence level used in establishing a cost estimate for a major 

defense acquisition program or major automated information 

system program and the rationale for selecting such confidence 

level; 

(2) ensure that such confidence level provides a high degree of confidence that the program can be completed without 

the need for significant adjustment to program budgets; and 

(3) include the disclosure required by paragraph (1)— 

(A) in any decision documentation approving a cost estimate within the baseline description or any other cost estimate for use at any event specified in subsection (a)(6); 

and 

(B) in the next Selected Acquisition Report pursuant 

to section 2432 of this title in the case of a major defense 

acquisition program, or the next quarterly report pursuant 

to section 2445c of this title in the case of a major automated information system program. 

(e) ESTIMATES FOR PROGRAM BASELINE AND ANALYSES AND

TARGETS FOR CONTRACT NEGOTIATION PURPOSES.—(1) The policies, 

procedures, and guidance issued by the Director of Cost Assessment and Program Evaluation in accordance with the requirements 

of subsection (a) shall provide that— 

(A) cost estimates developed for baseline descriptions and 

other program purposes conducted pursuant to subsection 

(a)(6) are not to be used for the purpose of contract negotiations or the obligation of funds; and 

(B) cost analyses and targets developed for the purpose of 

contract negotiations and the obligation of funds are based on 

the Government’s reasonable expectation of successful contractor performance in accordance with the contractor’s proposal and previous experience. 

(2) The Program Manager and contracting officer for each 

major defense acquisition program and major automated information system program shall ensure that cost analyses and targets 

developed for the purpose of contract negotiations and the obligation of funds are carried out in accordance with the requirements 

of paragraph (1) and the policies, procedures, and guidance issued 

by the Director of Cost Assessment and Program Evaluation. 

(3) Funds that are made available for a major defense acquisition program or major automated information system program in 

accordance with a cost estimate conducted pursuant to subsection 

(a)(6), but are excess to a cost analysis or target developed pursuant to paragraph (2), shall remain available for obligation in accordance with the terms of applicable authorization and appropriations Acts. 

(4) Funds described in paragraph (3)— 

(A) may be used— 

(i) to cover any increased program costs identified by 

a revised cost analysis or target developed pursuant to 

paragraph (2); 

(ii) to acquire additional end items in accordance with 

the requirements of section 2308 of this title; or 
§ 2334 CH. 137—PROCUREMENT GENERALLY 1228 

(iii) to cover the cost of risk reduction and process improvements; and 

(B) may be reprogrammed, in accordance with established 

procedures, only if determined to be excess to program needs 

on the basis of a cost estimate developed with the concurrence 

of the Director of Cost Assessment and Program Evaluation. 

(f) ANNUAL REPORT ON COST ASSESSMENT ACTIVITIES.—(1) The 

Director of Cost Assessment and Program Evaluation shall prepare 

an annual report summarizing the cost estimation and cost analysis activities of the Department of Defense during the previous 

year and assessing the progress of the Department in improving 

the accuracy of its cost estimates and analyses. Each report shall 

include, for the year covered by such report, an assessment of— 

(A) the extent to which each of the military departments 

and Defense Agencies have complied with policies, procedures, 

and guidance issued by the Director with regard to the preparation of cost estimates for major defense acquisition programs 

and major automated information systems; 

(B) the overall quality of cost estimates prepared by each 

of the military departments and Defense Agencies for major 

defense acquisition programs and major automated information 

system programs; and 

(C) any consistent differences in methodology or approach 

among the cost estimates prepared by the military departments, the Defense Agencies, and the Director. 

(2) Each report under this subsection shall be submitted concurrently to the Secretary of Defense, the Under Secretary of Defense for Acquisition, Technology, and Logistics, the Under Secretary of Defense (Comptroller), and the congressional defense committees not later than 10 days after the transmittal to Congress of 

the budget of the President for the next fiscal year (as submitted 

pursuant to section 1105 of title 31). 

(3)(A) Each report submitted to the congressional defense committees under this subsection shall be submitted in unclassified 

form, but may include a classified annex. 

(B) The Director shall ensure that a report submitted under 

this subsection does not include any information, such as proprietary or source selection sensitive information, that could undermine the integrity of the acquisition process. 

(C) The unclassified version of each report submitted to the 

congressional defense committees under this subsection shall be 

posted on an Internet website of the Department of Defense that 

is available to the public. 

(4) The Secretary of Defense may comment on any report of the 

Director to the congressional defense committees under this subsection. 

(g) STAFF.—The Secretary of Defense shall ensure that the Director of Cost Assessment and Program Evaluation has sufficient 

professional staff of military and civilian personnel to enable the 

Director to carry out the duties and responsibilities of the Director 

under this section. 

(Added Pub. L. 111–23, title I, Sec. 101(b)(1), May 22, 2009, 123 Stat. 1706; amended Pub. L. 

111–383, div. A, title VIII, Sec. 811, Jan. 7, 2011, 124 Stat. 4263.) 
1229 

CHAPTER 138—COOPERATIVE AGREEMENTS WITH NATO 

ALLIES AND OTHER COUNTRIES 

Subchapter Sec. 

I. Acquisition and Cross-Servicing Agreements .......................................... 2341

II. Other Cooperative Agreements ................................................................. 2350a 

SUBCHAPTER I—ACQUISITION AND CROSS-SERVICING 

AGREEMENTS 

Sec. 

2341. Authority to acquire logistic support, supplies, and services for elements 

of the armed forces deployed outside the United States. 

2342. Cross-servicing agreements. 

2343. Waiver of applicability of certain laws. 

2344. Methods of payment for acquisitions and transfers by the United States. 

2345. Liquidation of accrued credits and liabilities. 

2346. Crediting of receipts. 

2347. Limitation on amounts that may be obligated or accrued by the United 

States. 

2348. Inventories of supplies not to be increased. 

2349. Overseas Workload Program. 

2349a. Annual report on non-NATO agreements. 

2350. Definitions. 

§ 2341. Authority to acquire logistic support, supplies, and 

services for elements of the armed forces deployed 

outside the United States 

Subject to section 2343 of this title and subject to the availability of appropriations, the Secretary of Defense may— 

(1) acquire from the Governments of North Atlantic Treaty 

Organization countries, from North Atlantic Treaty Organization subsidiary bodies, and from the United Nations Organization or any regional international organization logistic support, 

supplies, and services for elements of the armed forces deployed outside the United States; and 

(2) acquire from any government not a member of the 

North Atlantic Treaty Organization logistic support, supplies, 

and services for elements of the armed forces deployed (or to 

be deployed) outside the United States if that country— 

(A) has a defense alliance with the United States; 

(B) permits the stationing of members of the armed 

forces in such country or the homeporting of naval vessels 

of the United States in such country; 

(C) has agreed to preposition materiel of the United 

States in such country; or 

(D) serves as the host country to military exercises 

which include elements of the armed forces or permits 

other military operations by the armed forces in such 

country. 

(Added Pub. L. 96–323, Sec. 2(a), Aug. 4, 1980, 94 Stat. 1016, Sec. 2321; renumbered Sec. 2341 

and amended Pub. L. 99–145, title XIII, Sec. 1304(a)(1), (4), Nov. 8, 1985, 99 Stat. 741; Pub. 
§ 2342 CH. 138—COOPERATIVE AGREEMENTS WITH OTHER COUNTRIES 1230 

L. 99–661, div. A, title XI, Sec. 1104(a), Nov. 14, 1986, 100 Stat. 3963; Pub. L. 102–484, div. 

A, title XIII, Sec. 1312(a), Oct. 23, 1992, 106 Stat. 2547; Pub. L. 103–337, div. A, title XIII, Sec. 

1317(a), Oct. 5, 1994, 108 Stat. 2899; Pub. L. 109–163, div. A, title XII, Sec. 1204, Jan. 6, 2006, 

119 Stat. 3456.) 

§ 2342. Cross-servicing agreements 

(a)(1) Subject to section 2343 of this title and to the availability 

of appropriations, and after consultation with the Secretary of 

State, the Secretary of Defense may enter into an agreement described in paragraph (2) with any of the following: 

(A) The government of a North Atlantic Treaty Organization country. 

(B) A subsidiary body of the North Atlantic Treaty Organization. 

(C) The United Nations Organization or any regional international organization. 

(D) The government of a country not a member of the 

North Atlantic Treaty Organization but which is designated by 

the Secretary of Defense, subject to the limitations prescribed 

in subsection (b), as a government with which the Secretary 

may enter into agreements under this section. 

(2) An agreement referred to in paragraph (1) is an agreement 

under which the United States agrees to provide logistic support, 

supplies, and services to military forces of a country or organization referred to in paragraph (1) in return for the reciprocal provisions of logistic support, supplies, and services by such government 

or organization to elements of the armed forces. 

(b) The Secretary of Defense may not designate a country for 

an agreement under this section unless— 

(1) the Secretary, after consultation with the Secretary of 

State, determines that the designation of such country for such 

purpose is in the interest of the national security of the United 

States; and 

(2) in the case of a country which is not a member of the 

North Atlantic Treaty Organization, the Secretary submits to 

the Committee on Armed Services and the Committee on Foreign Relations of the Senate and the Committee on Armed 

Services and the Committee on International Relations of the 

House of Representatives notice of the intended designation at 

least 30 days before the date on which such country is designated by the Secretary under subsection (a). 

(c) The Secretary of Defense may not use the authority of this 

subchapter to procure from any foreign government or international organization any goods or services reasonably available 

from United States commercial sources. 

(d) The Secretary shall prescribe regulations to ensure that 

contracts entered into under this subchapter are free from selfdealing, bribery, and conflict of interests. 

(Added Pub. L. 96–323, Sec. 2(a), Aug. 4, 1980, 94 Stat. 1016, Sec. 2322; renumbered Sec. 2342 

and amended Pub. L. 99–145, title XIII, Sec. 1304(a)(1), (4), Nov. 8, 1985, 99 Stat. 741; Pub. 

L. 99–661, div. A, title XI, Sec. 1104(a), Nov. 14, 1986, 100 Stat. 3963; Pub. L. 100–180, div. 

A, title XII, Sec. 1231(9), Dec. 4, 1987, 101 Stat. 1160; Pub. L. 101–189, div. A, title IX, Sec. 

931(e)(1), Nov. 29, 1989, 103 Stat. 1535; Pub. L. 101–510, div. A, title XIV, Sec. 1451(a), Nov. 

5, 1990, 104 Stat. 1692; Pub. L. 103–337, div. A, title XIII, Sec. 1317(b), Oct. 5, 1994, 108 Stat. 

2900; Pub. L. 104–106, div. A, title XV, Sec. 1502(a)(16), Feb. 10, 1996, 110 Stat. 504; Pub. L. 

106–65, div. A, title X, Sec. 1067(1), Oct. 5, 1999, 113 Stat. 774; Pub. L. 109–163, div. A, title 

XII, Sec. 1204, Jan. 6, 2006, 119 Stat. 3456.) 
1231 § 2344 CH. 138—COOPERATIVE AGREEMENTS WITH OTHER COUNTRIES

§ 2343. Waiver of applicability of certain laws 

Sections 2207, 2304(a), 2306(a), 2306(b), 2306(e), 2306a, and 

2313 of this title and section 6306 of title 41 shall not apply to acquisitions made under the authority of section 2341 of this title or 

to agreements entered into under section 2342 of this title. 

(Added Pub. L. 96–323, Sec. 2(a), Aug. 4, 1980, 94 Stat. 1017, Sec. 2323; renumbered Sec. 2343 

and amended Pub. L. 99–145, title IX, Sec. 961(b), title XIII, Sec. 1304(a)(1), (5), Nov. 8, 1985, 

99 Stat. 703, 741; Pub. L. 100–26, Sec. 7(g)(2), Apr. 21, 1987, 101 Stat. 282; Pub. L. 100–456, 

div. A, title XII, Sec. 1233(d), Sept. 29, 1988, 102 Stat. 2057; Pub. L. 101–189, div. A, title IX, 

Sec. 931(e)(1), Nov. 29, 1989, 103 Stat. 1535; Pub. L. 102–190, div. A, title X, Sec. 1061(a)(12), 

Dec. 5, 1991, 105 Stat. 1473; Pub. L. 103–337, div. A, title XIII, Sec. 1317(c)(1), (2)(A), Oct. 5, 

1994, 108 Stat. 2900; Pub. L. 111–350, Sec. 5(b)(20), Jan. 4, 2011, 124 Stat. 3844.) 

§ 2344. Methods of payment for acquisitions and transfers 

by the United States 

(a) Logistics support, supplies, and services may be acquired or 

transferred by the United States under the authority of this subchapter on a reimbursement basis or by replacement-in-kind or exchange of supplies or services of an equal value. 

(b)(1) In entering into agreements with the Government of another North Atlantic Treaty Organization country or other foreign 

country for the acquisition or transfer of logistic support, supplies, 

and services on a reimbursement basis, the Secretary of Defense 

shall negotiate for adoption of the following pricing principles for 

reciprocal application: 

(A) The price charged by a supplying country for logistics 

support, supplies, and services specifically procured by the supplying country from its contractors for a recipient country shall 

be no less favorable than the price for identical items or services charged by such contractors to the armed forces of the supplying country, taking into account price differentials due to 

delivery schedules, points of delivery, and other similar considerations. 

(B) The price charged a recipient country for supplies furnished by a supplying country from its inventory, and the price 

charged a recipient country for logistics support and services 

furnished by the officers, employees, or governmental agencies 

of a supplying country, shall be the same as the price charged 

for identical supplies, support, or services acquired by an 

armed force of the supplying country from such governmental 

sources. 

(2) To the extent that the Secretary of Defense is unable to obtain mutual acceptance by the other country involved of the reciprocal pricing principles for reimbursable transactions set forth in 

paragraph (1)— 

(A) the United States may not acquire from such country 

any logistic support, supply, or service not governed by such 

reciprocal pricing principles unless the United States forces 

commander acquiring such support, supply, or service determines (after price analysis) that the price thereof is fair and 

reasonable; and 

(B) transfers by the United States to such country under 

this subchapter of any logistic support, supply, or service that 

is not governed by such reciprocal pricing principles shall be 
§ 2345 CH. 138—COOPERATIVE AGREEMENTS WITH OTHER COUNTRIES 1232 

subject to the pricing provisions of the Arms Export Control 

Act (22 U.S.C. 2751 et seq.). 

(3) To the extent that indirect costs (including charges for 

plant and production equipment), administrative surcharges, and 

contract administration costs with respect to any North Atlantic 

Treaty Organization country or other foreign country are not 

waived by operation of the reciprocal pricing principles of paragraph (1), the Secretary of Defense may, on a reciprocal basis, 

agree to waive such costs. 

(4) The pricing principles set forth in paragraph (2) and the 

waiver authority provided in paragraph (3) shall also apply to 

agreements with North Atlantic Treaty Organization subsidiary 

bodies and the United Nations Organization or any regional international organization under this subchapter. 

(c) In acquiring or transferring logistics support, supplies, or 

services under the authority of this subchapter by exchange of supplies or services, the Secretary of Defense may not agree to or carry 

out the following: 

(1) Transfers in exchange for property the acquisition of 

which by the Department of Defense is prohibited by law. 

(2) Transfers of source, byproduct, or special nuclear materials or any other material, article, data, or thing of value the 

transfer of which is subject to the Atomic Energy Act of 1954 

(42 U.S.C. 2011 et seq.). 

(3) Transfers of chemical munitions. 

(Added Pub. L. 96–323, Sec. 2(a), Aug. 4, 1980, 94 Stat. 1017, Sec. 2324; amended Pub. L. 97– 

22, Sec. 11(a)(8), July 10, 1981, 95 Stat. 138; renumbered Sec. 2344, Pub. L. 99–145, title XIII, 

Sec. 1304(a)(1), Nov. 8, 1985, 99 Stat. 741; Pub. L. 99–661, div. A, title XI, Sec. 1104(b), Nov. 

14, 1986, 100 Stat. 3964; Pub. L. 101–189, div. A, title IX, Sec. 931(e)(1), 938(a), (b), Nov. 29, 

1989, 103 Stat. 1535, 1539; Pub. L. 102–25, title VII, Sec. 701(f)(2), Apr. 6, 1991, 105 Stat. 115; 

Pub. L. 103–337, div. A, title XIII, Sec. 1317(d), Oct. 5, 1994, 108 Stat. 2900; Pub. L. 109–163, 

div. A, title XII, Sec. 1204, Jan. 6, 2006, 119 Stat. 3456.) 

§ 2345. Liquidation of accrued credits and liabilities 

(a) Credits and liabilities of the United States accrued as a result of acquisitions and transfers of logistic support, supplies, and 

services under the authority of this subchapter shall be liquidated 

not less often than once every 12 months by direct payment to the 

entity supplying such support, supplies, or services by the entity 

receiving such support, supplies, or services. 

(b) Payment-in-kind or exchange entitlements accrued as a result of acquisitions and transfers of logistic support, supplies, and 

services under authority of this subchapter shall be satisfied within 

12 months after the date of the delivery of the logistic support, supplies, or services. 

(Added Pub. L. 96–323, Sec. 2(a), Aug. 4, 1980, 94 Stat. 1018, Sec. 2325; renumbered Sec. 2345, 

Pub. L. 99–145, title XIII, Sec. 1304(a)(1), Nov. 8, 1985, 99 Stat. 741; amended Pub. L. 99–661, 

div. A, title XI, Sec. 1104(c), Nov. 14, 1986, 100 Stat. 3965; Pub. L. 101–189, div. A, title IX, 

Sec. 931(e)(1), Nov. 29, 1989, 103 Stat. 1535; Pub. L. 103–337, div. A, title XIII, Sec. 1317(e), 

Oct. 5, 1994, 108 Stat. 2900.) 

§ 2346. Crediting of receipts 

Any receipt of the United States as a result of an agreement 

entered into under this subchapter shall be credited, at the option 

of the Secretary of Defense, to (1) the appropriation, fund, or account used in incurring the obligation, or (2) an appropriate appro-
1233 § 2347 CH. 138—COOPERATIVE AGREEMENTS WITH OTHER COUNTRIES

priation, fund, or account currently available for the purposes for 

which the expenditures were made. 

(Added Pub. L. 96–323, Sec. 2(a), Aug. 4, 1980, 94 Stat. 1018, Sec. 2326; renumbered Sec. 2346, 

Pub. L. 99–145, title XIII, Sec. 1304(a)(1), Nov. 8, 1985, 99 Stat. 741; amended Pub. L. 101– 

189, div. A, title IX, Sec. 931(e)(1), Nov. 29, 1989, 103 Stat. 1535; Pub. L. 103–337, div. A, title 

XIII, Sec. 1317(f), Oct. 5, 1994, 108 Stat. 2900.) 

§ 2347. Limitation on amounts that may be obligated or accrued by the United States 

(a)(1) Except during a period of active hostilities involving the 

armed forces, the total amount of reimbursable liabilities that the 

United States may accrue under this subchapter (before the computation of offsetting balances) with other member countries of the 

North Atlantic Treaty Organization, subsidiary bodies of the North 

Atlantic Treaty Organization, or from the United Nations Organization or any regional international organization of which the 

United States is a member may not exceed $200,000,000 in any fiscal year, and of such amount not more than $50,000,000 in liabilities may be accrued for the acquisition of supplies. 

(2) Except during a period of active hostilities involving the 

armed forces, the total amount of reimbursable liabilities that the 

United States may accrue under this subchapter (before the computation of offsetting balances) with a country which is not a member of the North Atlantic Treaty Organization, but with which the 

United States has one or more acquisition or cross-servicing agreements, may not exceed $60,000,000 in any fiscal year, and of such 

amount not more than $20,000,000 in liabilities may be accrued for 

the acquisition of supplies. The $60,000,000 limitation specified in 

this paragraph is in addition to the limitation specified in paragraph (1). 

(b)(1) Except during a period of active hostilities involving the 

armed forces, the total amount of reimbursable credits that the 

United States may accrue under this subchapter (before the computation of offsetting balances) with other member countries of the 

North Atlantic Treaty Organization, subsidiary bodies of the North 

Atlantic Treaty Organization, or from the United Nations Organization or any regional international organization of which the 

United States is a member may not exceed $150,000,000 in any fiscal year. 

(2) Except during a period of active hostilities involving the 

armed forces, the total amount of reimbursable credits that the 

United States may accrue under this subchapter (before the computation of offsetting balances) with a country which is not a member of the North Atlantic Treaty Organization, but with which the 

United States has one or more acquisition or cross-servicing agreements may not exceed $75,000,000 in any fiscal year. Such limitation specified in this paragraph is in addition to the limitation 

specified in paragraph (1). 

(c) When the armed forces are involved in a contingency operation or in a non-combat operation (including an operation in support of the provision of humanitarian or foreign disaster assistance 

or in support of peacekeeping operations under chapter VI or VII 

of the Charter of the United Nations), the restrictions in subsections (a) and (b) are waived for the purposes and duration of 

that operation. 
§ 2348 CH. 138—COOPERATIVE AGREEMENTS WITH OTHER COUNTRIES 1234 

(d) The amount of any sale, purchase, or exchange of petroleum, oils, or lubricants by the United States under this subchapter 

in any fiscal year shall be excluded in any computation for the purposes of subsection (a) or (b) of the amount of reimbursable liabilities or reimbursable credits that the United States accrues under 

this subchapter in that fiscal year. 

(Added Pub. L. 96–323, Sec. 2(a), Aug. 4, 1980, 94 Stat. 1018, Sec. 2327; renumbered Sec. 2347, 

Pub. L. 99–145, title XIII, Sec. 1304(a)(1), Nov. 8, 1985, 99 Stat. 741; amended Pub. L. 99–661, 

div. A, title XI, Sec. 1104(d), Nov. 14, 1986, 100 Stat. 3965; Pub. L. 100–456, div. A, title X, 

Sec. 1001, Sept. 29, 1988, 102 Stat. 2037; Pub. L. 101–189, div. A, title IX, Sec. 931(e)(1), Nov. 

29, 1989, 103 Stat. 1535; Pub. L. 102–484, div. A, title XIII, Sec. 1312(b), Oct. 23, 1992, 106 

Stat. 2547; Pub. L. 103–35, title II, Sec. 202(a)(10), May 31, 1993, 107 Stat. 101; Pub. L. 103– 

337, div. A, title XIII, Sec. 1317(g), Oct. 5, 1994, 108 Stat. 2901; Pub. L. 109–364, div. A, title 

XII, Sec. 1221(a), Oct. 17, 2006, 120 Stat. 2423.) 

§ 2348. Inventories of supplies not to be increased 

Inventories of supplies for elements of the armed forces may 

not be increased for the purpose of transferring supplies under the 

authority of this subchapter. 

(Added Pub. L. 96–323, Sec. 2(a), Aug. 4, 1980, 94 Stat. 1018, Sec. 2328; amended Pub. L. 97– 

22, Sec. 11(a)(8), July 10, 1981, 95 Stat. 138; renumbered Sec. 2348, Pub. L. 99–145, title XIII, 

Sec. 1304(a)(1), Nov. 8, 1985, 99 Stat. 741; Pub. L. 99–661, div. A, title XI, Sec. 1104(e), Nov. 

14, 1986, 100 Stat. 3965; Pub. L. 101–189, div. A, title IX, Sec. 931(e)(1), Nov. 29, 1989, 103 

Stat. 1535.) 

§ 2349. Overseas Workload Program 

(a) IN GENERAL.—A firm of any member nation of the North 

Atlantic Treaty Organization or of any major non-NATO ally shall 

be eligible to bid on any contract for the maintenance, repair, or 

overhaul of equipment of the Department of Defense located outside the United States to be awarded under competitive procedures 

as part of the program of the Department of Defense known as the 

Overseas Workload Program. 

(b) SITE OF PERFORMANCE.—A contract awarded to a firm described in subsection (a) may be performed in the theater in which 

the equipment is normally located or in the country in which the 

firm is located. 

(c) EXCEPTIONS.—The Secretary of a military department may 

restrict the geographic region in which a contract referred to in 

subsection (a) may be performed if the Secretary determines that 

performance of the contract outside that specific region— 

(1) could adversely affect the military preparedness of the 

armed forces; or 

(2) would violate the terms of an international agreement 

to which the United States is a party. 

(d) DEFINITION.—In this section, the term ‘‘major non-NATO 

ally’’ has the meaning given that term in section 2350a(i)(2) of this 

title. 

(Added Pub. L. 103–160, div. A, title XIV, Sec. 1431(a)(1), Nov. 30, 1993, 107 Stat. 1832; amended Pub. L. 108–375, div. A, title X, Sec. 1084(d)(18), Oct. 28, 2004, 118 Stat. 2062.) 

§ 2349a. Annual report on non-NATO agreements 

(a) REPORT.—The Secretary of Defense shall submit to Congress, not later than January 15 of each of 1996, 1997, 1998, 1999, 

and 2000, a report covering non-NATO cross-servicing and acquisition actions in effect during the preceding fiscal year. 
1235 § 2350 CH. 138—COOPERATIVE AGREEMENTS WITH OTHER COUNTRIES

(b) MATTERS TO BE INCLUDED.—Each such report shall set 

forth in detail the following with respect to the preceding fiscal 

year: 

(1) The total dollar amounts involved. 

(2) A description of any services and equipment provided 

or received through those actions. 

(3) A description of any equipment provided through those 

actions that is not returned. 

(4) The volume of credits and liabilities accrued and liquidated. 

(c) NON-NATO AGREEMENTS.—For purposes of this section, a 

non-NATO cross-servicing and acquisition agreement is a crossservicing and acquisition agreement under this subchapter that involves countries or organizations other than North Atlantic Treaty 

Organization countries or subsidiary bodies. 

(Added Pub. L. 103–337, div. A, title XIII, Sec. 1317(i)(1), Oct. 5, 1994, 108 Stat. 2902.) 

§ 2350. Definitions 

In this subchapter: 

(1) The term ‘‘logistic support, supplies, and services’’ 

means food, billeting, transportation (including airlift), petroleum, oils, lubricants, clothing, communications services, medical services, ammunition, base operations support (and construction incident to base operations support), storage services, 

use of facilities, training services, spare parts and components, 

repair and maintenance services, calibration services, and port 

services. Such term includes temporary use of general purpose 

vehicles and other nonlethal items of military equipment which 

are not designated as significant military equipment on the 

United States Munitions List promulgated pursuant to section 

38(a)(1) of the Arms Export Control Act. 

(2) The term ‘‘North Atlantic Treaty Organization subsidiary bodies’’ means— 

(A) any organization within the meaning of the term 

‘‘subsidiary bodies’’ in article I of the multilateral treaty on 

the Status of the North Atlantic Treaty Organisation, National Representatives and International Staff, signed at 

Ottawa on September 20, 1951 (TIAS 2992; 5 UST 1087); 

and 

(B) any international military headquarters or organization to which the Protocol on the Status of International 

Military Headquarters Set Up Pursuant to the North Atlantic Treaty, signed at Paris on August 28, 1952 (TIAS 

2978; 5 UST 870), applies. 

(3) The term ‘‘military region’’ means the geographical 

area of responsibility assigned to the commander of a unified 

combatant command (excluding Europe and adjacent waters). 

(4) The term ‘‘transfer’’ means selling (whether for payment in currency, replacement-in-kind, or exchange of supplies 

or services of equal value), leasing, loaning, or otherwise temporarily providing logistic support, supplies, and services under 

the terms of a cross-servicing agreement. 

(Added Pub. L. 96–323, Sec. 2(a), Aug. 4, 1980, 94 Stat. 1019, Sec. 2331; renumbered Sec. 2350, 

Pub. L. 99–145, title XIII, Sec. 1304(a)(3), Nov. 8, 1985, 99 Stat. 741; amended Pub. L. 99–661, 
§ 2350a CH. 138—COOPERATIVE AGREEMENTS WITH OTHER COUNTRIES 1236 

div. A, title XI, Sec. 1104(f), Nov. 14, 1986, 100 Stat. 3965; Pub. L. 100–26, Sec. 7(k)(2), Apr. 

21, 1987, 101 Stat. 284; Pub. L. 101–189, div. A, title IX, Sec. 931(e)(1), Nov. 29, 1989, 103 Stat. 

1535; Pub. L. 103–337, div. A, title XIII, Sec. 1317(h), Oct. 5, 1994, 108 Stat. 2901; Pub. L. 105– 

85, div. A, title XII, Sec. 1222, Nov. 18, 1997, 111 Stat. 1937.) 

SUBCHAPTER II—OTHER COOPERATIVE AGREEMENTS 

Sec. 

2350a. Cooperative research and development agreements: NATO organizations; 

allied and friendly foreign countries. 

2350b. Cooperative projects under Arms Export Control Act: acquisition of defense equipment. 

2350c. Cooperative military airlift agreements: allied countries. 

2350d. Cooperative logistic support agreements: NATO countries. 

2350e. NATO Airborne Warning and Control System (AWACS) program: authority of Secretary of Defense. 

2350f. Procurement of communications support and related supplies and services. 

2350g. Authority to accept use of real property, services, and supplies from foreign countries in connection with mutual defense agreements and occupational arrangements. 

2350h. Memorandums of agreement: Department of Defense ombudsman for foreign signatories. 

2350i. Foreign contributions for cooperative projects. 

2350j. Burden sharing contributions by designated countries and regional organizations. 

2350k. Relocation within host nation of elements of armed forces overseas. 

2350l. Cooperative agreements for reciprocal use of test facilities: foreign countries and international organizations. 

2350m. Participation in multinational military centers of excellence. 

§ 2350a. Cooperative research and development agreements: 

NATO organizations; allied and friendly foreign 

countries 

(a) AUTHORITY TO ENGAGE IN COOPERATIVE R&D PROJECTS.— (1) The Secretary of Defense may enter into a memorandum of understanding (or other formal agreement) with one or more countries or organizations referred to in paragraph (2) for the purpose 

of conducting cooperative research and development projects on defense equipment and munitions. 

(2) The countries and organizations with which the Secretary 

may enter into a memorandum of agreement (or other formal 

agreement) under paragraph (1) are as follows: 

(A) The North Atlantic Treaty Organization. 

(B) A NATO organization. 

(C) A member nation of the North Atlantic Treaty Organization. 

(D) A major non-NATO ally. 

(E) Any other friendly foreign country. 

(3) If such a memorandum of understanding (or other formal 

agreement) is with a country referred to in subparagraph (E) of 

paragraph (2), such memorandum (or agreement) may go into effect 

only after the Secretary submits to the Committees on Armed Services and on Foreign Relations of the Senate and to the Committees 

on Armed Services and on International Relations of the House of 

Representatives a report with respect to the proposed memorandum (or agreement) and a period of 30 days has passed after 

the report has been submitted. 

(b) REQUIREMENT THAT PROJECTS IMPROVE CONVENTIONAL DEFENSE CAPABILITIES.—(1) The Secretary of Defense may not enter 

into a memorandum of understanding (or other formal agreement) 
1237 § 2350a CH. 138—COOPERATIVE AGREEMENTS WITH OTHER COUNTRIES

to conduct a cooperative research and development project under 

this section unless the Secretary determines that the proposed 

project will improve, through the application of emerging technology, the conventional defense capabilities of the North Atlantic 

Treaty Organization or the common conventional defense capabilities of the United States and a country or organization referred to 

in subsection (a)(2). 

(2) The authority of the Secretary to make a determination 

under paragraph (1) may only be delegated to the Deputy Secretary 

of Defense and to one other official of the Department of Defense. 

(c) COST SHARING.—Each cooperative research and development project entered into under this section shall require sharing 

of the costs of the project (including the costs of claims) between 

the participants on an equitable basis. 

(d) RESTRICTIONS ON PROCUREMENT OF EQUIPMENT AND SERV- ICES.—(1) In order to assure substantial participation on the part 

of the countries and organizations referred to in subsection (a)(2) 

in cooperative research and development projects, funds made 

available for such projects may not be used to procure equipment 

or services from any foreign government, foreign research organization, or other foreign entity. 

(2) A country or organization referred to in subsection (a)(2) 

may not use any military or economic assistance grant, loan, or 

other funds provided by the United States for the purpose of making the contribution of that country or organization to a cooperative 

research and development program entered into with the United 

States under this section. 

(e) COOPERATIVE OPPORTUNITIES DOCUMENT.—(1) In order to 

ensure that opportunities to conduct cooperative research and development projects are considered at an early point during the formal development review process of the Department of Defense in 

connection with any planned project of the Department, the Under 

Secretary of Defense for Acquisition, Technology, and Logistics 

shall prepare a cooperative opportunities document before the first 

milestone or decision point with respect to that project for review 

by the Defense Acquisition Board at formal meetings of the Board. 

(2) A cooperative opportunities document referred to in paragraph (1) shall include the following: 

(A) A statement indicating whether or not a project similar 

to the one under consideration by the Department of Defense 

is in development or production by any country or organization 

referred to in subsection (a)(2) or NATO organizations. 

(B) If a project similar to the one under consideration by 

the Department of Defense is in development or production by 

one or more countries and organizations referred to in subsection (a)(2), an assessment by the Under Secretary of Defense for Acquisition, Technology, and Logistics as to whether 

that project could satisfy, or could be modified in scope so as 

to satisfy, the military requirements of the project of the 

United States under consideration by the Department of Defense. 

(C) An assessment of the advantages and disadvantages 

with regard to program timing, developmental and life cycle 

costs, technology sharing, and Rationalization, Standardiza-
§ 2350a CH. 138—COOPERATIVE AGREEMENTS WITH OTHER COUNTRIES 1238 

tion, and Interoperability (RSI) of seeking to structure a cooperative development program with one or more countries and 

organizations referred to in subsection (a)(2) or NATO organizations. 

(D) The recommendation of the Under Secretary as to 

whether the Department of Defense should explore the feasibility and desirability of a cooperative development program 

with one or more countries and organizations referred to in 

subsection (a)(2) or NATO organizations. 

[(f) Repealed. Pub. L. 108–136, div. A, title X, Sec. 1031(a)(17), 

Nov. 24, 2003, 117 Stat. 1597.] 

(g) SIDE-BY-SIDE TESTING.—(1) It is the sense of Congress— 

(A) that the Secretary of Defense should test conventional 

defense equipment, munitions, and technologies manufactured 

and developed by countries referred to in subsection (a)(2) to 

determine the ability of such equipment, munitions, and technologies to satisfy United States military requirements or to 

correct operational deficiencies; and 

(B) that while the testing of nondevelopmental items and 

items in the late state of the development process are preferred, the testing of equipment, munitions, and technologies 

may be conducted to determine procurement alternatives. 

(2) The Secretary of Defense may acquire equipment, munitions, and technologies of the type described in paragraph (1) for 

the purpose of conducting the testing described in that paragraph. 

(3) The Assistant Secretary of Defense for Research and Engineering shall notify the congressional defense committees of the intent to obligate funds made available to carry out this subsection 

not less than 7 days before such funds are obligated. 

(h) SECRETARY TO ENCOURAGE SIMILAR PROGRAMS.—The Secretary of Defense shall encourage member nations of the North Atlantic Treaty Organization, major non-NATO allies, and other 

friendly foreign countries to establish programs similar to the one 

provided for in this section. 

(i) DEFINITIONS.—In this section: 

(1) The term ‘‘cooperative research and development 

project’’ means a project involving joint participation by the 

United States and one or more countries and organizations referred to in subsection (a)(2) under a memorandum of understanding (or other formal agreement) to carry out a joint research and development program— 

(A) to develop new conventional defense equipment 

and munitions; or 

(B) to modify existing military equipment to meet 

United States military requirements. 

(2) The term ‘‘major non-NATO ally’’ means a country 

(other than a member nation of the North Atlantic Treaty Organization) that is designated as a major non-NATO ally for 

purposes of this section by the Secretary of Defense with the 

concurrence of the Secretary of State. 

(3) The term ‘‘NATO organization’’ means any North Atlantic Treaty Organization subsidiary body referred to in section 2350(2) of this title and any other organization of the 

North Atlantic Treaty Organization. 
1239 § 2350b CH. 138—COOPERATIVE AGREEMENTS WITH OTHER COUNTRIES

(Added Pub. L. 101–189, div. A, title IX, Sec. 931(a)(2), Nov. 29, 1989, 103 Stat. 1531; amended 

Pub. L. 101–510, div. A, title XIII, Sec. 1331(4), Nov. 5, 1990, 104 Stat. 1673; Pub. L. 102–190, 

div. A, title X, Sec. 1053, Dec. 5, 1991, 105 Stat. 1471; Pub. L. 102–484, div. A, title VIII, Sec. 

843(b)(1), Oct. 23, 1992, 106 Stat. 2469; Pub. L. 103–160, div. A, title IX, Sec. 904(d)(1), Nov. 

30, 1993, 107 Stat. 1728; Pub. L. 103–337, div. A, title XIII, Sec. 1301, Oct. 5, 1994, 108 Stat. 

2888; Pub. L. 104–106, div. A, title XV, Sec. 1502(a)(17), Feb. 10, 1996, 110 Stat. 504; Pub. L. 

106–65, div. A, title X, Sec. 1067(1), Oct. 5, 1999, 113 Stat. 774; Pub. L. 107–107, div. A, title 

X, Sec. 1048(b)(2), title XII, Sec. 1212(a)–(e)(1), Dec. 28, 2001, 115 Stat. 1225, 1248–1250; Pub. 

L. 107–314, div. A, title X, Secs. 1041(a)(9), 1062(f)(2), Dec. 2, 2002, 116 Stat. 2645, 2651; Pub. 

L. 108–136, div. A, title X, Sec. 1031(a)(17), Nov. 24, 2003, 117 Stat. 1597; Pub. L. 110–181, 

div. A, title II, Sec. 237, title XII, Sec. 1251, Jan. 28, 2008, 122 Stat. 48, 401; Pub. L. 111–383, 

div. A, title IX, Sec. 901(j)(4), Jan. 7, 2011, 124 Stat. 4324.) 

§ 2350b. Cooperative projects under Arms Export Control 

Act: acquisition of defense equipment 

(a)(1) If the President delegates to the Secretary of Defense the 

authority to carry out section 27(d) of the Arms Export Control Act 

(22 U.S.C. 2767(d)), relating to cooperative projects (as defined in 

such section), the Secretary may utilize his authority under this 

title in carrying out contracts or obligations incurred under such 

section. 

(2) Except as provided in subsection (c), chapter 137 of this 

title shall apply to such contracts (referred to in paragraph (1)) entered into by the Secretary of Defense. Except to the extent waived 

under subsection (c) or some other provision of law, all other provisions of law relating to procurement, if otherwise applicable, shall 

apply to such contracts entered into by the Secretary of Defense. 

(b) When contracting or incurring obligations under section 

27(d) of the Arms Export Control Act for cooperative projects, the 

Secretary of Defense may require subcontracts to be awarded to 

particular subcontractors in furtherance of the cooperative project. 

(c)(1) Subject to paragraph (2), when entering into contracts or 

incurring obligations under section 27(d) of the Arms Export Control Act outside the United States, the Secretary of Defense may 

waive with respect to any such contract or subcontract the application of any provision of law, other than a provision of the Arms Export Control Act or section 2304 of this title, that specifically prescribes— 

(A) procedures to be followed in the formation of contracts; 

(B) terms and conditions to be included in contracts; 

(C) requirements for or preferences to be given to goods 

grown, produced, or manufactured in the United States or in 

United States Government-owned facilities or for services to be 

performed in the United States; or 

(D) requirements regulating the performance of contracts. 

(2) A waiver may not be made under paragraph (1) unless the 

Secretary determines that the waiver is necessary to ensure that 

the cooperative project will significantly further standardization, 

rationalization, and interoperability. 

(3) The authority of the Secretary to make waivers under this 

subsection may be delegated only to the Deputy Secretary of Defense or the Acquisition Executive designated for the Office of the 

Secretary of Defense. 

(d)(1) The Secretary of Defense shall notify the Congress each 

time he requires that a prime contract be awarded to a particular 

prime contractor or that a subcontract be awarded to a particular 

subcontractor to comply with a cooperative agreement. The Sec-
§ 2350c CH. 138—COOPERATIVE AGREEMENTS WITH OTHER COUNTRIES 1240 

retary shall include in each such notice the reason for exercising 

his authority to designate a particular contractor or subcontractor, 

as the case may be. 

(2) The Secretary shall also notify the Congress each time he 

exercises a waiver under subsection (c) and shall include in such 

notice the particular provision or provisions of law that were 

waived. 

(3) A report under this subsection shall be required only to the 

extent that the information required by this subsection has not 

been provided in a report made by the President under section 

27(e) of the Arms Export Control Act (22 U.S.C. 2767(e)). 

(e)(1) In carrying out a cooperative project under section 27 of 

the Arms Export Control Act, the Secretary of Defense may agree 

that a participant (other than the United States) or a NATO organization may make a contract for requirements of the United 

States under the project if the Secretary determines that such a 

contract will significantly further standardization, rationalization, 

and interoperability. Except to the extent waived under this section 

or under any other provision of law, the Secretary shall ensure that 

such contract will be made on a competitive basis and that United 

States sources will not be precluded from competing under the contract. 

(2) If a participant (other than the United States) in such a cooperative project or a NATO organization makes a contract on behalf of such project to meet the requirements of the United States, 

the contract may permit the contracting party to follow its own procedures relating to contracting. 

(f) In carrying out a cooperative project, the Secretary of Defense may also agree to the disposal of property that is jointly acquired by the members of the project without regard to any laws 

of the United States applicable to the disposal of property owned 

by the United States. Disposal of such property may include a 

transfer of the interest of the United States in such property to one 

of the other governments participating in the cooperative agreement or the sale of such property. Payment for the transfer or sale 

of any interest of the United States in any such property shall be 

made in accordance with the terms of the cooperative agreement. 

(g) Nothing in this section shall be construed as authorizing 

the Secretary of Defense— 

(1) to waive any of the financial management responsibilities administered by the Secretary of the Treasury; or 

(2) to waive the cargo preference laws of the United States, 

including section 2631 of this title and section 55305 of title 46. 

(Added Pub. L. 99–145, title XI, Sec. 1102(b)(1), Nov. 8, 1985, 99 Stat. 710, Sec. 2407; amended 

Pub. L. 99–661, div. A, title XI, Sec. 1103(b)(1), (2)(A), title XIII, Sec. 1343(a)(15), Nov. 14, 1986, 

100 Stat. 3963, 3993; renumbered Sec. 2350b and amended Pub. L. 101–189, div. A, title IX, 

Sec. 931(b)(1), (e)(3), Nov. 29, 1989, 103 Stat. 1534, 1535; Pub. L. 104–106, div. A, title XIII, 

Sec. 1335, div. D, title XLIII, Sec. 4321(b)(10), Feb. 10, 1996, 110 Stat. 484, 672; Pub. L. 108– 

375, div. A, title X, Sec. 1084(d)(19), Oct. 28, 2004, 118 Stat. 2062; Pub. L. 109–304, Sec. 

17(a)(3), Oct. 6, 2006, 120 Stat. 1706.) 

§ 2350c. Cooperative military airlift agreements: allied countries 

(a) Subject to the availability of appropriations, and after consultation with the Secretary of State, the Secretary of Defense may 

enter into cooperative military airlift agreements with the govern-
1241 § 2350c CH. 138—COOPERATIVE AGREEMENTS WITH OTHER COUNTRIES

ment of any allied country for the transportation of the personnel 

and cargo of the military forces of that country on aircraft operated 

by or for the military forces of the United States in return for the 

reciprocal transportation of the personnel and cargo of the military 

forces of the United States on aircraft operated by or for the military forces of that allied country. Any such agreement shall include 

the following terms: 

(1) The rate of reimbursement for transportation provided 

shall be the same for each party and shall be not less than the 

rate charged to military forces of the United States, as determined by the Secretary of Defense under section 2208(h) of 

this title. 

(2) Credits and liabilities accrued as a result of providing 

or receiving transportation shall be liquidated as agreed upon 

by the parties. Liquidation shall be either by direct payment 

to the country that has provided the greater amount of transportation or by the providing of in-kind transportation services 

to that country. The liquidation shall occur on a regular basis, 

but not less often than once every 12 months. 

(3) During peacetime, the only military airlift capacity that 

may be used to provide transportation is that capacity that (A) 

is not needed to meet the transportation requirements of the 

military forces of the country providing the transportation, and 

(B) was not created solely to accommodate the requirements of 

the military forces of the country receiving the transportation. 

(4) Defense articles purchased by an allied country from 

the United States under the Arms Export Control Act (22 

U.S.C. 2751 et seq.) or from a commercial source under the export controls of the Arms Export Control Act may not be transported (for the purpose of delivery incident to the purchase of 

the defense articles) to the purchasing allied country on aircraft operated by or for the military forces of the United States 

except at a rate of reimbursement that is equal to the full cost 

of transportation of the defense articles, as required by section 

21(a)(3) of the Arms Export Control Act (22 U.S.C. 2761(a)(3)). 

(b) Subject to the availability of appropriations, and after consultation with the Secretary of State, the Secretary of Defense may 

enter into nonreciprocal military airlift agreements with North Atlantic Treaty Organization subsidiary bodies for the transportation 

of the personnel and cargo of such subsidiary bodies on aircraft operated by or for the military forces of the United States. Any such 

agreement shall be subject to such terms as the Secretary of Defense considers appropriate. 

(c) Any amount received by the United States as a result of an 

agreement entered into under this section shall be credited to applicable appropriations, accounts, and funds of the Department of 

Defense. 

(d) In this section: 

(1) The term ‘‘allied country’’ means any of the following: 

(A) A country that is a member of the North Atlantic 

Treaty Organization. 

(B) Australia, New Zealand, Japan, and the Republic 

of Korea. 
§ 2350d CH. 138—COOPERATIVE AGREEMENTS WITH OTHER COUNTRIES 1242 

(C) Any other country designated as an allied country 

for the purposes of this section by the Secretary of Defense 

with the concurrence of the Secretary of State. 

(2) The term ‘‘North Atlantic Treaty Organization subsidiary bodies’’ has the meaning given to it by section 2350 of 

this title. 

(Added Pub. L. 97–252, title XI, Sec. 1125(a), Sept. 8, 1982, 96 Stat. 757, Sec. 2213; amended 

Pub. L. 99–145, title XIII, Sec. 1304(b), Nov. 8, 1985, 99 Stat. 742; Pub. L. 100–26, Sec. 7(k)(2), 

Apr. 21, 1987, 101 Stat. 284; renumbered Sec. 2350c and amended Pub. L. 101–189, div. A, title 

IX, Sec. 931(b)(2), (e)(4), Nov. 29, 1989, 103 Stat. 1534, 1535; Pub. L. 102–484, div. A, title XIII, 

Sec. 1311, Oct. 23, 1992, 106 Stat. 2547; Pub. L. 106–398, Sec. 1 [[div. A], title XII, Sec. 1222], 

Oct. 30, 2000, 114 Stat. 1654, 1654A–328.) 

§ 2350d. Cooperative logistic support agreements: NATO 

countries 

(a) GENERAL AUTHORITY.—(1) The Secretary of Defense may 

enter into bilateral or multilateral agreements known as Weapon 

System Partnership Agreements with one or more governments of 

other member countries of the North Atlantic Treaty Organization 

(NATO) participating in the operation of the NATO Maintenance 

and Supply Organization. Any such agreement shall be for the purpose of providing cooperative logistics support for the armed forces 

of the countries which are parties to the agreement. Any such 

agreement— 

(A) shall be entered into pursuant to the terms of the charter of the NATO Maintenance and Supply Organization; and 

(B) shall provide for the common logistic support of a specific weapon system common to the participating countries. 

(2) Such an agreement may provide for— 

(A) the transfer of logistics support, supplies, and services 

by the United States to the NATO Maintenance and Supply 

Organization; and 

(B) the acquisition of logistics support, supplies, and services by the United States from that Organization. 

(b) AUTHORITY OF SECRETARY.—Under the terms of a Weapon 

System Partnership Agreement, the Secretary of Defense— 

(1) may agree that the NATO Maintenance and Supply Organization may enter into contracts for supply and acquisition 

of logistics support in Europe for requirements of the United 

States, to the extent the Secretary determines that the procedures of such Organization governing such supply and acquisition are appropriate; and 

(2) may share the costs of set-up charges of facilities for 

use by the NATO Maintenance and Supply Organization to 

provide cooperative logistics support and in the costs of establishing a revolving fund for initial acquisition and replenishment of supply stocks to be used by the NATO Maintenance 

and Supply Organization to provide cooperative logistics support. 

(c) SHARING OF ADMINISTRATIVE EXPENSES.—Each Weapon 

System Partnership Agreement shall provide for joint management 

by the participating countries and for the equitable sharing of the 

administrative costs and costs of claims incident to the agreement. 

(d) APPLICATION OF CHAPTER 137.—Except as otherwise provided in this section, the provisions of chapter 137 of this title 
1243 § 2350e CH. 138—COOPERATIVE AGREEMENTS WITH OTHER COUNTRIES

apply to a contract entered into by the Secretary of Defense for the 

acquisition of logistics support under a Weapon System Partnership Agreement. 

(e) APPLICATION OF ARMS EXPORT CONTROL ACT.—Any transfer 

of defense articles or defense services to a member country of the 

North Atlantic Treaty Organization or to the NATO Maintenance 

and Supply Organization for the purposes of a Weapon System 

Partnership Agreement shall be carried out in accordance with this 

chapter and the Arms Export Control Act (22 U.S.C. 2751 et seq.). 

(f) SUPPLEMENTAL AUTHORITY.—The authority of the Secretary 

of Defense under this section is in addition to the authority of the 

Secretary under subchapter I and any other provision of law. 

(Added and amended Pub. L. 101–189, div. A, title IX, Sec. 931(c), 938(c), Nov. 29, 1989, 103 

Stat. 1534, 1539; Pub. L. 102–484, div. A, title VIII, Sec. 843(b)(2), Oct. 23, 1992, 106 Stat. 

2469.) 

§ 2350e. NATO Airborne Warning and Control System 

(AWACS) program: authority of Secretary of Defense 

(a) AUTHORITY UNDER AWACS PROGRAM.—The Secretary of 

Defense, in carrying out an AWACS memorandum of understanding, may do the following: 

(1) Waive reimbursement for the cost of the following functions performed by personnel other than personnel employed in 

the United States Air Force Airborne Warning and Control 

System (AWACS) program office: 

(A) Auditing. 

(B) Quality assurance. 

(C) Codification. 

(D) Inspection. 

(E) Contract administration. 

(F) Acceptance testing. 

(G) Certification services. 

(H) Planning, programming, and management services. 

(2) Waive any surcharge for administrative services otherwise chargeable. 

(3) In connection with that Program, assume contingent liability for— 

(A) program losses resulting from the gross negligence 

of any contracting officer of the United States; 

(B) identifiable taxes, customs duties, and other 

charges levied within the United States on the program; 

and 

(C) the United States share of the unfunded termination liability. 

(b) CONTRACT AUTHORITY LIMITATION.—Authority under this 

section to enter into contracts shall be effective for any fiscal year 

only to such extent or in such amounts as are provided in appropriation Acts. 

(c) DEFINITION.—In this section, the term ‘‘AWACS memorandum of understanding’’ means— 

(1) the Multilateral Memorandum of Understanding Between the North Atlantic Treaty Organization (NATO) Min-
§ 2350f CH. 138—COOPERATIVE AGREEMENTS WITH OTHER COUNTRIES 1244 

isters of Defence on the NATO E–3A Cooperative Programme, 

signed by the Secretary of Defense on December 6, 1978; 

(2) the Memorandum of Understanding for Operations and 

Support of the NATO Airborne Early Warning and Control 

Force, signed by the United States Ambassador to NATO on 

September 26, 1984; 

(3) the Addendum to the Multilateral Memorandum of Understanding Between the North Atlantic Treaty Organization 

(NATO) Ministers of Defence on the NATO E–3A Cooperative 

Programme (dated December 6, 1978) relating to the modernization of the NATO Airborne Early Warning and Control 

(NAEW&C) System, dated December 7, 1990; and 

(4) any other follow-on support agreement for the NATO 

E–3A Cooperative Programme. 

(Added Pub. L. 101–189, div. A, title IX, Sec. 932(a)(1), Nov. 29, 1989, 103 Stat. 1536; amended 

Pub. L. 102–190, div. A, title X, Sec. 1051, Dec. 5, 1991, 105 Stat. 1470; Pub. L. 103–160, div. 

A, title XIV, Sec. 1413, Nov. 30, 1993, 107 Stat. 1829.) 

§ 2350f. Procurement of communications support and related supplies and services 

(a) As an alternative means of obtaining communications support and related supplies and services, the Secretary of Defense, 

subject to the approval of the Secretary of State, may enter into a 

bilateral arrangement with any allied country or allied international organization or may enter into a multilateral arrangement 

with allied countries and allied international organizations, under 

which, in return for being provided communications support and 

related supplies and services, the United States would agree to provide to the allied country or countries or allied international organization or allied international organizations, as the case may be, 

an equivalent value of communications support and related supplies and services. The term of an arrangement entered into under 

this subsection may not exceed five years. 

(b)(1) Any arrangement entered into under this section shall 

require that any accrued credits and liabilities resulting from an 

unequal exchange of communications support and related supplies 

and services during the term of such arrangement would be liquidated by direct payment to the party having provided the greater 

amount of communications support and related supplies and services. Liquidations may be made at such times as the parties in an 

arrangement may agree upon, but in no case may final liquidation 

in the case of an arrangement be made later than 30 days after the 

end of the term for which the arrangement was entered into. 

(2) Parties to an arrangement entered into under this section 

shall annually reconcile accrued credits and liabilities accruing 

under such agreement. Any liability of the United States resulting 

from a reconciliation shall be charged against the applicable appropriation available to the Department of Defense (at the time of the 

reconciliation) for obligation for communications support and related supplies and services. 

(3) Payments received by the United States shall be credited 

to the appropriation from which such communications support and 

related supplies and services have been provided. 
1245 § 2350g CH. 138—COOPERATIVE AGREEMENTS WITH OTHER COUNTRIES

[(c) Repealed. Pub. L. 107–314, div. A, title X, Sec. 1041(a)(10), 

Dec. 2, 2002, 116 Stat. 2645.] 

(d) In this section: 

(1) The term ‘‘allied country’’ means— 

(A) a country that is a member of the North Atlantic 

Treaty Organization; 

(B) Australia, New Zealand, Japan, or the Republic of 

Korea; or 

(C) any other country designated as an allied country 

for purposes of this section by the Secretary of Defense 

with the concurrence of the Secretary of State. 

(2) The term ‘‘allied international organization’’ means the 

North Atlantic Treaty Organization (NATO) or any other international organization designated as an allied international organization for the purposes of this section by the Secretary of 

Defense with the concurrence of the Secretary of State. 

(Added Pub. L. 98–525, title X, Sec. 1005(a), Oct. 19, 1984, 98 Stat. 2578, Sec. 2401a; amended 

Pub. L. 100–26, Sec. 7(k)(3), Apr. 21, 1987, 101 Stat. 284; renumbered Sec. 2350f and amended 

Pub. L. 101–189, div. A, title IX, Sec. 933(a)–(d), Nov. 29, 1989, 103 Stat. 1537; Pub. L. 101– 

510, div. A, title XIV, Sec. 1484(k)(8), Nov. 5, 1990, 104 Stat. 1719; Pub. L. 104–106, div. A, 

title XV, Sec. 1502(a)(2), Feb. 10, 1996, 110 Stat. 502; Pub. L. 106–65, div. A, title X, Sec. 

1067(1), Oct. 5, 1999, 113 Stat. 774; Pub. L. 107–314, div. A, title X, Sec. 1041(a)(10), Dec. 2, 

2002, 116 Stat. 2645.) 

§ 2350g. Authority to accept use of real property, services, 

and supplies from foreign countries in connection 

with mutual defense agreements and occupational 

arrangements 

(a) AUTHORITY TO ACCEPT.—The Secretary of Defense may accept from a foreign country, for the support of any element of the 

armed forces in an area of that country— 

(1) real property or the use of real property and services 

and supplies for the United States or for the use of the United 

States in accordance with a mutual defense agreement or occupational arrangement; and 

(2) services furnished as reciprocal international courtesies 

or as services customarily made available without charge. 

(b) AUTHORITY TO USE PROPERTY, SERVICES, AND SUPPLIES.— 

Property, services, or supplies referred to in subsection (a) may be 

used by the Secretary of Defense without specific authorization, except that such property, services, and supplies may not be used in 

connection with any program, project, or activity if the use of such 

property, services, or supplies would result in the violation of any 

prohibition or limitation otherwise applicable to that program, 

project, or activity. 

(c) PERIODIC AUDITS BY GAO.—The Comptroller General of the 

United States shall make periodic audits of money and property accepted under this section, at such intervals as the Comptroller 

General determines to be warranted. The Comptroller General 

shall submit to Congress a report on the results of each such audit. 

(Added Pub. L. 101–510, div. A, title XIV, Sec. 1451(b)(1), Nov. 5, 1990, 104 Stat. 1692; amended 

Pub. L. 103–160, div. A, title XI, Sec. 1105(a), Nov. 30, 1993, 107 Stat. 1749; Pub. L. 106–65, 

div. A, title X, Sec. 1032(a)(3), Oct. 5, 1999, 113 Stat. 751.) 
§ 2350h CH. 138—COOPERATIVE AGREEMENTS WITH OTHER COUNTRIES 1246 

§ 2350h. Memorandums of agreement: Department of Defense ombudsman for foreign signatories 

The Secretary of Defense shall designate an official to act as 

ombudsman within the Department of Defense on behalf of foreign 

governments who are parties to memorandums of agreement with 

the United States concerning acquisition matters under the jurisdiction of the Secretary of Defense. The official so designated shall 

assist officials of those foreign governments in understanding and 

complying with procedures and requirements of the Department of 

Defense (and, as appropriate, other departments and agencies of 

the United States) insofar as they relate to any such memorandum 

of agreement. 

(Added Pub. L. 101–510, div. A, title XIV, Sec. 1452(a)(1), Nov. 5, 1990, 104 Stat. 1693.) 

§ 2350i. Foreign contributions for cooperative projects 

(a) CREDITING OF CONTRIBUTIONS.—Whenever the United 

States participates in a cooperative project with a friendly foreign 

country or the North Atlantic Treaty Organization (NATO) on a 

cost-sharing basis, any contribution received by the United States 

from that foreign country or NATO to meet its share of the costs 

of the project may be credited to appropriations available to an appropriate military department or another appropriate organization 

within the Department of Defense, as determined by the Secretary 

of Defense. 

(b) USE OF AMOUNTS CREDITED.—The amount of a contribution 

credited pursuant to subsection (a) to an appropriation account in 

connection with a cooperative project referred to in that subsection 

shall be available only for payment of the share of the project expenses allocated to the foreign country or NATO making the contribution. Payments for which such amount is available include the 

following: 

(1) Payments to contractors and other suppliers (including 

the Department of Defense and other participants acting as 

suppliers) for necessary articles and services. 

(2) Payments for any damages and costs resulting from the 

performance or cancellation of any contract or other obligation. 

(3) Payments or reimbursements of other program expenses, including program office overhead and administrative 

costs. 

(4) Refunds to other participants. 

(c) DEFINITIONS.—In this section: 

(1) The term ‘‘cooperative project’’ means a jointly managed arrangement, described in a written cooperative agreement entered into by the participants, that— 

(A) is undertaken by the participants in order to improve the conventional defense capabilities of the participants; and 

(B) provides for— 

(i) one or more participants (other than the United 

States) to share with the United States the cost of research and development, testing, evaluation, or joint 

production (including follow-on support) of defense articles; 
1247 § 2350j CH. 138—COOPERATIVE AGREEMENTS WITH OTHER COUNTRIES

(ii) the United States and another participant concurrently to produce in the United States and the 

country of such other participant a defense article 

jointly developed in a cooperative project described in 

clause (i); or 

(iii) the United States to procure a defense article 

or a defense service from another participant in the cooperative project. 

(2) The term ‘‘defense article’’ has the meaning given such 

term in section 47(3) of the Arms Export Control Act (22 

U.S.C. 2794(3)). 

(3) The term ‘‘defense service’’ has the meaning given such 

term in section 47(4) of the Arms Export Control Act (22 

U.S.C. 2794(4)). 

(Added Pub. L. 102–190, div. A, title X, Sec. 1047(a), Dec. 5, 1991, 105 Stat. 1467.) 

§ 2350j. Burden sharing contributions by designated countries and regional organizations 

(a) AUTHORITY TO ACCEPT CONTRIBUTIONS.—The Secretary of 

Defense, after consultation with the Secretary of State, may accept 

cash contributions from any country or regional organization designated for purposes of this section by the Secretary of Defense, in 

consultation with the Secretary of State, for the purposes specified 

in subsection (c). 

(b) ACCOUNTING.—Contributions accepted under subsection (a) 

which are not related to security assistance may be accepted, managed, and expended in dollars or in the currency of the host nation 

(or, in the case of a contribution from a regional organization, in 

the currency in which the contribution was provided). Any such 

contribution shall be placed in an account established for such purpose and shall remain available until expended for the purposes 

specified in subsection (c). The Secretary of Defense shall establish 

a separate account for such purpose for each country or regional organization from which such contributions are accepted under subsection (a). 

(c) AVAILABILITY OF CONTRIBUTIONS.—Contributions accepted 

under subsection (a) shall be available only for the payment of the 

following costs: 

(1) Compensation for local national employees of the Department of Defense. 

(2) Military construction projects of the Department of Defense. 

(3) Supplies and services of the Department of Defense. 

(d) AUTHORIZATION OF MILITARY CONSTRUCTION.—Contributions placed in an account established under subsection (b) may be 

used— 

(1) by the Secretary of Defense to carry out a military construction project that is consistent with the purposes for which 

the contributions were made and is not otherwise authorized 

by law; or 

(2) by the Secretary of a military department, with the approval of the Secretary of Defense, to carry out such a project. 

(e) NOTICE AND WAIT REQUIREMENTS.—(1) When a decision is 

made to carry out a military construction project under subsection 
§ 2350k CH. 138—COOPERATIVE AGREEMENTS WITH OTHER COUNTRIES 1248 

(d), the Secretary of Defense shall submit to the congressional defense committees a report containing— 

(A) an explanation of the need for the project; 

(B) the then current estimate of the cost of the project; and 

(C) a justification for carrying out the project under that 

subsection. 

(2) The Secretary of Defense or the Secretary of a military department may not commence a military construction project under 

subsection (d) until the end of the 21-day period beginning on the 

date on which the Secretary of Defense submits the report under 

paragraph (1) regarding the project or, if earlier, the end of the 14- 

day period beginning on the date on which a copy of that report 

is provided in an electronic medium pursuant to section 480 of this 

title. 

(3)(A) A military construction project under subsection (d) may 

be carried out without regard to the requirement in paragraph (1) 

and the limitation in paragraph (2) if the project is necessary to 

support the armed forces in the country or region in which the 

project is carried out by reason of a declaration of war, or a declaration by the President of a national emergency pursuant to the 

National Emergencies Act (50 U.S.C. 1601 et seq.), that is in force 

at the time of the commencement of the project. 

(B) When a decision is made to carry out a military construction project under subparagraph (A), the Secretary of Defense shall 

submit to the congressional defense committees— 

(i) a notice of the decision; and 

(ii) a statement of the current estimated cost of the project, 

including the cost of any real property transaction in connection with the project. 

(f) REPORTS.—Not later than 30 days after the end of each fiscal year, the Secretary of Defense shall submit to Congress a report 

specifying separately for each country and regional organization 

from which contributions have been accepted by the Secretary 

under subsection (a)— 

(1) the amount of the contributions accepted by the Secretary during the preceding fiscal year under subsection (a) 

and the purposes for which the contributions were made; and 

(2) the amount of the contributions expended by the Secretary during the preceding fiscal year and the purposes for 

which the contributions were expended. 

(Added Pub. L. 103–160, div. A, title XIV, Sec. 1402(a), Nov. 30, 1993, 107 Stat. 1825; amended 

Pub. L. 103–337, div. A, title X, Sec. 1070(a)(10), Oct. 5, 1994, 108 Stat. 2856; Pub. L. 104– 

106, div. A, title XIII, Sec. 1331, Feb. 10, 1996, 110 Stat. 482; Pub. L. 106–65, div. A, title X, 

Sec. 1067(1), div. B, title XXVIII, Sec. 2801, Oct. 5, 1999, 113 Stat. 774, 845; Pub. L. 108–136, 

div. A, title X, Secs. 1031(a)(18), 1043(b)(12), Nov. 24, 2003, 117 Stat. 1597, 1611.) 

§ 2350k. Relocation within host nation of elements of armed 

forces overseas 

(a) AUTHORITY TO ACCEPT CONTRIBUTIONS.—The Secretary of 

Defense may accept contributions from any nation because of or in 

support of the relocation of elements of the armed forces from or 

to any location within that nation. Such contributions may be accepted in dollars or in the currency of the host nation. Any such 

contribution shall be placed in an account established for such purpose and shall remain available until expended for the purposes 
1249 § 2350l CH. 138—COOPERATIVE AGREEMENTS WITH OTHER COUNTRIES

specified in subsection (b). The Secretary shall establish a separate 

account for such purpose for each country from which such contributions are accepted. 

(b) USE OF CONTRIBUTIONS.—The Secretary may use a contribution accepted under subsection (a) only for payment of costs 

incurred in connection with the relocation concerning which the 

contribution was made. Those costs include the following: 

(1) Design and construction services, including development and review of statements of work, master plans and designs, acquisition of construction, and supervision and administration of contracts relating thereto. 

(2) Transportation and movement services, including packing, unpacking, storage, and transportation. 

(3) Communications services, including installation and 

deinstallation of communications equipment, transmission of 

messages and data, and rental of transmission capability. 

(4) Supply and administration, including acquisition of expendable office supplies, rental of office space, budgeting and 

accounting services, auditing services, secretarial services, and 

translation services. 

(5) Personnel costs, including salary, allowances and overhead of employees whether full-time or part-time, temporary or 

permanent (except for military personnel), and travel and temporary duty costs. 

(6) All other clearly identifiable expenses directly related 

to relocation. 

(c) METHOD OF CONTRIBUTION.—Contributions may be accepted 

in any of the following forms: 

(1) Irrevocable letter of credit issued by a financial institution acceptable to the Treasurer of the United States. 

(2) Drawing rights on a commercial bank account established and funded by the host nation, which account is blocked 

such that funds deposited cannot be withdrawn except by or 

with the approval of the United States. 

(3) Cash, which shall be deposited in a separate trust fund 

in the United States Treasury pending expenditure and which 

shall accrue interest in accordance with section 9702 of title 

31. 

(Added Pub. L. 104–106, div. A, title XIII, Sec. 1332(a)(1), Feb. 10, 1996, 110 Stat. 483; amended 

Pub. L. 107–314, div. A, title X, Sec. 1041(a)(11), Dec. 2, 2002, 116 Stat. 2645.) 

§ 2350l. Cooperative agreements for reciprocal use of test facilities: foreign countries and international organizations 

(a) AUTHORITY.—The Secretary of Defense, with the concurrence of the Secretary of State, may enter into a memorandum of 

understanding (or other formal agreement) with a foreign country 

or international organization to provide for the testing, on a reciprocal basis, of defense equipment (1) by the United States using 

test facilities of that country or organization, and (2) by that country or organization using test facilities of the United States. 

(b) PAYMENT OF COSTS.—A memorandum or other agreement 

under subsection (a) shall provide that, when a party to the agreement uses a test facility of another party to the agreement, the 
§ 2350l CH. 138—COOPERATIVE AGREEMENTS WITH OTHER COUNTRIES 1250 

party using the test facility is charged by the party providing the 

test facility in accordance with the following principles: 

(1) The user party shall be charged the amount equal to 

the direct costs incurred by the provider party in furnishing 

test and evaluation services by the providing party’s officers, 

employees, or governmental agencies. 

(2) The user party may also be charged indirect costs relating to the use of the test facility, but only to the extent specified in the memorandum or other agreement. 

(c) DETERMINATION OF INDIRECT COSTS; DELEGATION OF AUTHORITY.—(1) The Secretary of Defense shall determine the appropriateness of the amount of indirect costs charged by the United 

States pursuant to subsection (b)(2). 

(2) The Secretary may delegate the authority under paragraph 

(1) only to the Deputy Secretary of Defense and to one other official 

of the Department of Defense. 

(d) RETENTION OF FUNDS COLLECTED BY THE UNITED STATES.— 

Amounts collected by the United States from a party using a test 

facility of the United States pursuant to a memorandum or other 

agreement under this section shall be credited to the appropriation 

accounts from which the costs incurred by the United States in providing such test facility were paid. 

(e) DEFINITIONS.—In this section: 

(1) The term ‘‘direct cost’’, with respect to the use of a test 

facility pursuant to a memorandum or other agreement under 

subsection (a)— 

(A) means any item of cost that is easily and readily 

identified to a specific unit of work or output within the 

test facility where the use occurred, that would not have 

been incurred if such use had not occurred; and 

(B) may include costs of labor, materials, facilities, 

utilities, equipment, supplies, and any other resources of 

the test facility that are consumed or damaged in connection with— 

(i) the use; or 

(ii) the maintenance of the test facility for purposes of the use. 

(2) The term ‘‘indirect cost’’, with respect to the use of a 

test facility pursuant to a memorandum or other agreement 

under subsection (a)— 

(A) means any item of cost that is not easily and readily identified to a specific unit of work or output within the 

test facility where the use occurred; and 

(B) may include general and administrative expenses 

for such activities as supporting base operations, manufacturing, supervision, procurement of office supplies, and 

utilities that are accumulated costs allocated among several users. 

(3) The term ‘‘test facility’’ means a range or other facility 

at which testing of defense equipment may be carried out. 

(Added Pub. L. 107–107, title XII, Sec. 1213(a), Dec. 28, 2001, 115 Stat. 1250.) 
1251 § 2350m CH. 138—COOPERATIVE AGREEMENTS WITH OTHER COUNTRIES

§ 2350m. Participation in multinational military centers of 

excellence 

(a) PARTICIPATION AUTHORIZED.—The Secretary of Defense 

may, with the concurrence of the Secretary of State, authorize the 

participation of members of the armed forces and Department of 

Defense civilian personnel in any multinational military center of 

excellence for purposes of— 

(1) enhancing the ability of military forces and civilian personnel of the nations participating in such center to engage in 

joint exercises or coalition or international military operations; 

or 

(2) improving interoperability between the armed forces 

and the military forces of friendly foreign nations. 

(b) MEMORANDUM OF UNDERSTANDING.—(1) The participation 

of members of the armed forces or Department of Defense civilian 

personnel in a multinational military center of excellence under 

subsection (a) shall be in accordance with the terms of one or more 

memoranda of understanding entered into by the Secretary of Defense, with the concurrence of the Secretary of State, and the foreign nation or nations concerned. 

(2) If Department of Defense facilities, equipment, or funds are 

used to support a multinational military center of excellence under 

subsection (a), the memoranda of understanding under paragraph 

(1) with respect to that center shall provide details of any costsharing arrangement or other funding arrangement. 

(c) AVAILABILITY OF APPROPRIATED FUNDS.—(1) Funds appropriated to the Department of Defense for operation and maintenance are available as follows: 

(A) To pay the United States share of the operating expenses of any multinational military center of excellence in 

which the United States participates under this section. 

(B) To pay the costs of the participation of members of the 

armed forces and Department of Defense civilian personnel in 

multinational military centers of excellence under this section, 

including the costs of expenses of such participants. 

(2) No funds may be used under this section to fund the pay 

or salaries of members of the armed forces and Department of Defense civilian personnel who participate in multinational military 

centers of excellence under this section. 

(d) USE OF DEPARTMENT OF DEFENSE FACILITIES AND EQUIPMENT.—Facilities and equipment of the Department of Defense 

may be used for purposes of the support of multinational military 

centers of excellence under this section that are hosted by the Department. 

(e) ANNUAL REPORTS ON USE OF AUTHORITY.—(1) Not later 

than October 31, 2009, and annually thereafter, the Secretary of 

Defense shall submit to the Committee on Armed Services of the 

Senate and the Committee on Armed Services of the House of Representatives a report on the use of the authority in this section during the preceding fiscal year. 

(2) Each report required by paragraph (1) shall include, for the 

fiscal year covered by such report, the following: 
§ 2350m CH. 138—COOPERATIVE AGREEMENTS WITH OTHER COUNTRIES 1252 

(A) A detailed description of the participation of the Department of Defense, and of members of the armed forces and 

civilian personnel of the Department, in multinational military 

centers of excellence under the authority of this section. 

(B) For each multinational military center of excellence in 

which the Department of Defense, or members of the armed 

forces or civilian personnel of the Department, so participated— 

(i) a description of such multinational military center 

of excellence; 

(ii) a description of the activities participated in by the 

Department, or by members of the armed forces or civilian 

personnel of the Department; and 

(iii) a statement of the costs of the Department for 

such participation, including— 

(I) a statement of the United States share of the 

expenses of such center and a statement of the percentage of the United States share of the expenses of 

such center to the total expenses of such center; and 

(II) a statement of the amount of such costs (including a separate statement of the amount of costs 

paid for under the authority of this section by category 

of costs). 

(f) MULTINATIONAL MILITARY CENTER OF EXCELLENCE DEFINED.—In this section, the term ‘‘multinational military center of 

excellence’’ means an entity sponsored by one or more nations that 

is accredited and approved by the Military Committee of the North 

Atlantic Treaty Organization (NATO) as offering recognized expertise and experience to personnel participating in the activities of 

such entity for the benefit of NATO by providing such personnel 

opportunities to— 

(1) enhance education and training; 

(2) improve interoperability and capabilities; 

(3) assist in the development of doctrine; and 

(4) validate concepts through experimentation. 

(Added Pub. L. 110–417, [div. A], title XII, Sec. 1232(a)(1), Oct. 14, 2008, 122 Stat. 4637.) 
1253 

CHAPTER 139—RESEARCH AND DEVELOPMENT 

Sec. 

2351. Availability of appropriations. 

2352. Defense Advanced Research Projects Agency: biennial strategic plan. 

2353. Contracts: acquisition, construction, or furnishing of test facilities and 

equipment. 

2354. Contracts: indemnification provisions. 

[2355 to 2357. Repealed.] 

2358. Research and development projects. 

2359. Science and technology programs to be conducted so as to foster the transition of science and technology to higher levels of research, development, 

test, and evaluation. 

2359a. Technology Transition Initiative. 

2359b. Defense Acquisition Challenge Program. 

2360. Research and development laboratories: contracts for services of university 

students. 

2361. Award of grants and contracts to colleges and universities: requirement of 

competition. 

2362. Research and educational programs and activities: historically black colleges and universities and minority-serving institutions of higher education. 

[2363. Repealed.] 

2364. Coordination and communication of defense research activities. 

2365. Global Research Watch Program. 

2366. Major systems and munitions programs: survivability testing and lethality 

testing required before full-scale production. 

2366a. Major defense acquisition programs: certification required before Milestone A or Key Decision Point A approval. 

2366b. Major defense acquisition programs: certification required before Milestone B or Key Decision Point B approval. 

2367. Use of federally funded research and development centers. 

[2368 to 2370a. Repealed.] 

2371. Research projects: transactions other than contracts and grants. 

2371a. Cooperative research and development agreements under StevensonWydler Technology Innovation Act of 1980. 

2372. Independent research and development and bid and proposal costs: payments to contractors. 

2373. Procurement for experimental purposes. 

2374. Merit-based award of grants for research and development. 

2374a. Prizes for advanced technology achievements. 

2374b. Prizes for achievements in promoting science, mathematics, engineering, 

or technology education. 

§ 2351. Availability of appropriations 

(a) Funds appropriated to the Department of Defense for research and development remain available for obligation for a period 

of two consecutive years. 

(b) Funds appropriated to the Department of Defense for research and development may be used— 

(1) for the purposes of section 2353 of this title; and 

(2) for purposes related to research and development for 

which expenditures are specifically authorized in other appropriations of the Department of Defense. 

(Added Pub. L. 97–258, Sec. 2(b)(3)(B), Sept. 13, 1982, 96 Stat. 1052, Sec. 2361; renumbered 

Sec. 2351 and amended Pub. L. 100–370, Sec. 1(g)(1), July 19, 1988, 102 Stat. 846.) 
§ 2352 CH. 139—RESEARCH AND DEVELOPMENT 1254 

§ 2352. Defense Advanced Research Projects Agency: biennial strategic plan 

(a) REQUIREMENT FOR STRATEGIC PLAN.—Every other year, and 

in time for submission to Congress under subsection (c), the Director of the Defense Advanced Research Projects Agency shall prepare a strategic plan for the activities of that agency. 

(b) CONTENTS.—The strategic plan required by subsection (a) 

shall include the following matters: 

(1) The long-term strategic goals of that agency. 

(2) Identification of the research programs of that agency 

that support— 

(A) achievement of those strategic goals; and 

(B) exploitation of opportunities that hold the potential for yielding significant military benefits. 

(3) The connection of the activities and programs of that 

agency to activities and missions of the armed forces. 

(4) A technology transition strategy for the programs of 

that agency. 

(5) A description of the policies of that agency on the management, organization, and personnel of that agency. 

(c) SUBMISSION OF PLAN TO CONGRESS.—The Secretary of Defense shall submit to Congress the strategic plan most recently prepared under subsection (a) at the same time that the President 

submits to Congress the budget for an even-numbered fiscal year 

under section 1105(a) of title 31. 

(Added Pub. L. 108–136, div. A, title II, Sec. 232(a), Nov. 24, 2003, 117 Stat. 1422.) 

§ 2353. Contracts: acquisition, construction, or furnishing of 

test facilities and equipment 

(a) A contract of a military department for research or development, or both, may provide for the acquisition or construction by, 

or furnishing to, the contractor, of research, developmental, or test 

facilities and equipment that the Secretary of the military department concerned determines to be necessary for the performance of 

the contract. The facilities and equipment, and specialized housing 

for them, may be acquired or constructed at the expense of the 

United States, and may be lent or leased to the contractor with or 

without reimbursement, or may be sold to him at fair value. This 

subsection does not authorize new construction or improvements 

having general utility. 

(b) Facilities that would not be readily removable or separable 

without unreasonable expense or unreasonable loss of value may 

not be installed or constructed under this section on property not 

owned by the United States, unless the contract contains— 

(1) a provision for reimbursing the United States for the 

fair value of the facilities at the completion or termination of 

the contract or within a reasonable time thereafter; 

(2) an option in the United States to acquire the underlying land; or 

(3) an alternative provision that the Secretary concerned 

considers to be adequate to protect the interests of the United 

States in the facilities. 
1255 § 2358 CH. 139—RESEARCH AND DEVELOPMENT 

(c) Proceeds of sales or reimbursements under this section 

shall be paid into the Treasury as miscellaneous receipts, except to 

the extent otherwise authorized by law with respect to property acquired by the contractor. 

(Aug. 10, 1956, ch. 1041, 70A Stat. 134.) 

§ 2354. Contracts: indemnification provisions 

(a) With the approval of the Secretary of the military department concerned, any contract of a military department for research 

or development, or both, may provide that the United States will 

indemnify the contractor against either or both of the following, but 

only to the extent that they arise out of the direct performance of 

the contract and to the extent not compensated by insurance or 

otherwise: 

(1) Claims (including reasonable expenses of litigation or 

settlement) by third persons, including employees of the contractor, for death, bodily injury, or loss of or damage to property, from a risk that the contract defines as unusually hazardous. 

(2) Loss of or damage to property of the contractor from a 

risk that the contract defines as unusually hazardous. 

(b) A contract, made under subsection (a), that provides for indemnification must also provide for— 

(1) notice to the United States of any claim or suit against 

the contractor for the death, bodily injury, or loss of or damage 

to property; and 

(2) control of or assistance in the defense by the United 

States, at its election, of that suit or claim. 

(c) No payment may be made under subsection (a) unless the 

Secretary of the department concerned, or an officer or official of 

his department designated by him, certifies that the amount is just 

and reasonable. 

(d) Upon approval by the Secretary concerned, payments under 

subsection (a) may be made from— 

(1) funds obligated for the performance of the contract concerned; 

(2) funds available for research or development, or both, 

and not otherwise obligated; or 

(3) funds appropriated for those payments. 

(Aug. 10, 1956, ch. 1041, 70A Stat. 134.) 

[§ 2355. Repealed. Pub. L. 103–355, title II, Sec. 2002(a), Oct. 

13, 1994, 108 Stat. 3303] 

[§ 2356. Repealed. Pub. L. 104–106, div. A, title VIII, Sec. 

802(a), Feb. 10, 1996, 110 Stat. 390] 

[§ 2357. Repealed. Pub. L. 101–510, div. A, title XIII, Sec. 

1301(11), Nov. 5, 1990, 104 Stat. 1668] 

§ 2358. Research and development projects 

(a) AUTHORITY.—The Secretary of Defense or the Secretary of 

a military department may engage in basic research, applied research, advanced research, and development projects that— 
§ 2359 CH. 139—RESEARCH AND DEVELOPMENT 1256 

(1) are necessary to the responsibilities of such Secretary’s 

department in the field of research and development; and 

(2) either— 

(A) relate to weapon systems and other military needs; 

or 

(B) are of potential interest to the Department of Defense. 

(b) AUTHORIZED MEANS.—The Secretary of Defense or the Secretary of a military department may perform research and development projects— 

(1) by contract, cooperative agreement, or grant, in accordance with chapter 63 of title 31; 

(2) through one or more military departments; 

(3) by using employees and consultants of the Department 

of Defense; or 

(4) by mutual agreement with the head of any other department or agency of the Federal Government. 

(c) REQUIREMENT OF POTENTIAL DEPARTMENT OF DEFENSE INTEREST.—Funds appropriated to the Department of Defense or to 

a military department may not be used to finance any research 

project or study unless the project or study is, in the opinion of the 

Secretary of Defense or the Secretary of that military department, 

respectively, of potential interest to the Department of Defense or 

to such military department, respectively. 

(d) ADDITIONAL PROVISIONS APPLICABLE TO COOPERATIVE

AGREEMENTS.—Additional authorities, conditions, and requirements relating to certain cooperative agreements authorized by this 

section are provided in sections 2371 and 2371a of this title. 

(Added Pub. L. 87–651, title II, Sec. 208(a), Sept. 7, 1962, 76 Stat. 523; amended Pub. L. 97– 

86, title IX, Sec. 910, Dec. 1, 1981, 95 Stat. 1120; Pub. L. 100–370, Sec. 1(g)(3), July 19, 1988, 

102 Stat. 846; Pub. L. 103–160, div. A, title VIII, Sec. 827(a), Nov. 30, 1993, 107 Stat. 1712; 

Pub. L. 103–355, title I, Sec. 1301(a), Oct. 13, 1994, 108 Stat. 3284; Pub. L. 104–201, div. A, 

title II, Sec. 267(c)(2), Sept. 23, 1996, 110 Stat. 2468.) 

§ 2359. Science and technology programs to be conducted so 

as to foster the transition of science and technology to higher levels of research, development, 

test, and evaluation 

(a) POLICY.—Each official specified in subsection (b) shall ensure that the management and conduct of the science and technology programs under the authority of that official are carried out 

in a manner that will foster the transition of science and technology to higher levels of research, development, test, and evaluation. 

(b) COVERED OFFICIALS.—Subsection (a) applies to the following officials of the Department of Defense: 

(1) The Under Secretary of Defense for Acquisition, Technology, and Logistics. 

(2) The Secretary of each military department. 

(3) The Director of the Defense Advanced Research 

Projects Agency. 

(4) The directors and heads of other offices and agencies of 

the Department of Defense with assigned research, development, test, and evaluation responsibilities. 
1257 § 2359a CH. 139—RESEARCH AND DEVELOPMENT 

(Added Pub. L. 106–398, Sec. 1 [[div. A], title IX, Sec. 904(a)(1)], Oct. 30, 2000, 114 Stat. 1654, 

1654A–225.) 

§ 2359a. Technology Transition Initiative 

(a) INITIATIVE REQUIRED.—The Secretary of Defense, acting 

through the Under Secretary of Defense for Acquisition, Technology, and Logistics, shall carry out an initiative, to be known as 

the Technology Transition Initiative (hereinafter in this section referred to as the ‘‘Initiative’’), to facilitate the rapid transition of 

new technologies from science and technology programs of the Department of Defense into acquisition programs of the Department 

for the production of such technologies. 

(b) OBJECTIVES.—The objectives of the Initiative are as follows: 

(1) To accelerate the introduction of new technologies into 

operational capabilities for the armed forces. 

(2) To successfully demonstrate new technologies in relevant environments. 

(c) MANAGEMENT OF INITIATIVE.—(1) The Under Secretary 

shall designate a senior official of the Department of Defense (hereinafter in this section referred to as the ‘‘Manager’’) to manage the 

Initiative. 

(2) In managing the Initiative, the Manager shall— 

(A) report directly to the Under Secretary; and 

(B) obtain advice and other assistance from the Technology 

Transition Council established under subsection (g). 

(3) The Manager shall— 

(A) in consultation with the Technology Transition Council 

established under subsection (g), identify promising technology 

transition projects that can contribute to meeting Department 

of Defense technology goals and requirements; 

(B) identify potential sponsors in the Department of Defense to manage such projects; and 

(C) provide funds under subsection (f) for those projects 

that are selected under subsection (d)(2). 

(d) SELECTION OF PROJECTS.—(1) The science and technology 

and acquisition executives of each military department and each 

appropriate Defense Agency and the commanders of the unified 

and specified combatant commands may nominate technology transition projects for implementation under subsection (e) and shall 

submit a list of the projects so nominated to the Manager. 

(2) The Manager, in consultation with the Technology Transition Council established under subsection (g), shall select projects 

for implementation under subsection (e) from among the projects 

on the lists submitted under paragraph (1). 

(e) IMPLEMENTATION OF PROJECTS.—For each project selected 

under subsection (d)(2), the Manager shall designate a military department or Defense Agency to implement the project. 

(f) FUNDING OF PROJECTS.—(1) From funds made available to 

the Manager for the Initiative, the Manager shall, subject to paragraphs (2) and (3), provide funds for each project selected under 

subsection (d)(2) in an amount determined by mutual agreement 

between the Manager and the acquisition executive of the military 

department or Defense Agency concerned. 
§ 2359b CH. 139—RESEARCH AND DEVELOPMENT 1258 

1 In section 2359a(h), ‘‘section 16(c) of the Office of Federal Procurement Policy Act (41 U.S.C. 

414(c))’’ should be ‘‘section 1702(c) of title 41’’. 

(2) The amount of funds provided to a project under paragraph 

(1) by the military department or Defense Agency concerned shall 

be the appropriate share of the military department or Defense 

Agency, as the case may be, of the cost of the project, as determined by the Manager. 

(3) A project shall not be provided funds under this subsection 

for more than four fiscal years. 

(g) TECHNOLOGY TRANSITION COUNCIL.—(1) There is a Technology Transition Council in the Department of Defense. The Council is composed of the following members: 

(A) The science and technology executive of each military 

department and each Defense Agency. 

(B) The acquisition executive of each military department. 

(C) The members of the Joint Requirements Oversight 

Council. 

(2) The duty of the Council shall be to support the Under Secretary of Defense for Acquisition, Technology, and Logistics in developing policies to facilitate the rapid transition of technologies 

from science and technology programs into acquisition programs of 

the Department of Defense. 

(3) The Council shall meet not less often than semiannually to 

carry out its duty under paragraph (2). 

(h) DEFINITION.—In this section, the term ‘‘acquisition executive’’, with respect to a military department or Defense Agency, 

means the official designated as the senior procurement executive 

for that military department or Defense Agency for the purposes of 

section 16(c) of the Office of Federal Procurement Policy Act (41 

U.S.C. 414(c)) 1. 

(Added Pub. L. 107–314, div. A, title II, Sec. 242(a)(1), Dec. 2, 2002, 116 Stat. 2494; amended 

Pub. L. 109–163, div. A, title II, Sec. 255(a), Jan. 6, 2006, 119 Stat. 3180; Pub. L. 109–364, div. 

A, title X, Sec. 1071(a)(2), Oct. 17, 2006, 120 Stat. 2398; Pub. L. 110–181, div. A, title II, Sec. 

233, Jan. 28, 2008, 122 Stat. 46; Pub. L. 110–417, [div. A], title II, Sec. 253(b), Oct. 14, 2008, 

122 Stat. 4402.) 

§ 2359b. Defense Acquisition Challenge Program 

(a) PROGRAM REQUIRED.—(1) The Secretary of Defense, acting 

through the Under Secretary of Defense for Acquisition, Technology, and Logistics, shall carry out a program to provide opportunities for the increased introduction of innovative and cost-saving 

technology in acquisition programs of the Department of Defense. 

(2) The program, to be known as the Defense Acquisition Challenge Program (hereinafter in this section referred to as the ‘‘Challenge Program’’), shall provide any person or activity within or outside the Department of Defense with the opportunity to propose alternatives, to be known as challenge proposals, at the component, 

subsystem, or system level of an existing Department of Defense 

acquisition program that would result in improvements in performance, affordability, manufacturability, or operational capability of 

that acquisition program. 

(b) PANELS.—The Under Secretary shall establish one or more 

panels of highly qualified scientists and engineers (hereinafter in 
1259 § 2359b CH. 139—RESEARCH AND DEVELOPMENT 

this section referred to as ‘‘Panels’’) to provide preliminary evaluations of challenge proposals under subsection (c). 

(c) PRELIMINARY EVALUATION BY PANELS.—(1) Under procedures prescribed by the Under Secretary, a person or activity within or outside the Department of Defense may submit challenge proposals to a Panel, through the unsolicited proposal process or in response to a broad agency announcement. 

(2) The Under Secretary shall establish procedures pursuant to 

which appropriate officials of the Department of Defense may identify proposals submitted through the unsolicited proposal process 

as challenge proposals. The procedures shall provide for the expeditious referral of such proposals to a Panel for preliminary evaluation under this subsection. 

(3) The Under Secretary shall issue on an annual basis not less 

than one such broad agency announcement inviting interested parties to submit challenge proposals. Such announcements may also 

identify particular technology areas and acquisition programs that 

will be given priority in the evaluation of challenge proposals. 

(4)(A) The Under Secretary shall establish procedures for the 

prompt issuance of a solicitation for challenge proposals addressing— 

(i) any acquisition program for which, since the last such 

announcement, the Secretary concerned has determined under 

section 2433(d) of this title that the program’s acquisition unit 

cost or procurement unit cost has increased by a percentage 

equal to or greater than the critical cost growth threshold for 

the program (in this section referred to as a ‘‘critical cost 

growth threshold breach’’); and 

(ii) any design, engineering, manufacturing, or technology 

integration issues, in accordance with the assessment required 

by section 2433(e)(2)(A) of this title, that have contributed significantly to the cost growth of such program. 

(B) A solicitation under this paragraph may be included in a 

broad agency announcement issued pursuant to paragraph (3) as 

long as the broad agency announcement is released in an expeditious manner following the determination of the Secretary concerned that a critical cost growth threshold breach has occurred 

with respect to a major defense acquisition program. 

(5) Under procedures established by the Under Secretary, a 

Panel shall carry out a preliminary evaluation of each challenge 

proposal submitted in response to a broad agency announcement, 

or submitted through the unsolicited proposal process and identified as a challenge proposal in accordance with paragraph (2), to 

determine each of the following: 

(A) Whether the challenge proposal has merit. 

(B) Whether the challenge proposal is likely to result in 

improvements in performance, affordability, manufacturability, 

or operational capability at the component, subsystem, or system level of an acquisition program. 

(C) Whether the challenge proposal could be implemented 

in the acquisition program rapidly, at an acceptable cost, and 

without unacceptable disruption to the acquisition program. 

(6) The Under Secretary— 
§ 2359b CH. 139—RESEARCH AND DEVELOPMENT 1260 

(A) may establish procedures to ensure that the Challenge 

Program does not become an avenue for the repetitive submission of proposals that have been previously reviewed and found 

not to have merit; and 

(B) may establish procedures to ensure that the Challenge 

Program establishes appropriate priorities for proposals from 

businesses that are not major contractors with the Department 

of Defense. 

(7) If a Panel determines that a challenge proposal satisfies 

each of the criteria specified in paragraph (5), the person or activity 

submitting that challenge proposal shall be provided an opportunity to submit such challenge proposal for a full review and evaluation under subsection (d). 

(d) FULL REVIEW AND EVALUATION.—(1) Under procedures prescribed by the Under Secretary, for each challenge proposal submitted for a full review and evaluation as provided in subsection 

(c)(7), the office carrying out the acquisition program to which the 

proposal relates shall, in consultation with the prime system contractor carrying out such program, conduct a full review and evaluation of the proposal. 

(2) The full review and evaluation shall, independent of the determination of a Panel under subsection (c)(5), determine each of 

the matters specified in subparagraphs (A), (B), and (C) of such 

subsection. The full review and evaluation shall also include— 

(A) an assessment of the cost of adopting the challenge 

proposal and implementing it in the acquisition program; and 

(B) consideration of any intellectual property issues associated with the challenge proposal. 

(e) ACTION UPON FAVORABLE FULL REVIEW AND EVALUATION.— 

(1) Under procedures prescribed by the Under Secretary, each challenge proposal determined under a full review and evaluation to 

satisfy each of the criteria specified in subsection (c)(5) with respect 

to an acquisition program shall be considered by the office carrying 

out the applicable acquisition program and the prime system contractor for incorporation into the acquisition program as a new 

technology insertion at the component, subsystem, or system level. 

(2) The Under Secretary shall encourage the adoption of each 

challenge proposal referred to in paragraph (1) by providing suitable incentives to the office carrying out the acquisition program 

and the prime system contractor carrying out such program. 

(3) In the case of a challenge proposal submitted in response 

to a solicitation issued as a result of a critical cost growth threshold breach that is determined under full review and evaluation to 

satisfy each of the criteria specified in subsection (c)(5), the Under 

Secretary shall establish guidelines for covering the costs of the 

challenge proposal. If appropriate, such guidelines shall not be restricted to funding provided by the Defense Acquisition Challenge 

Program, but shall also consider alternative funding sources, such 

as the acquisition program with respect to which the breach occurred. 

(f) ACTION UPON UNFAVORABLE FULL REVIEW AND EVALUATION.—Under procedures prescribed by the Under Secretary, if a 

challenge proposal is determined by a Panel to satisfy each of the 

criteria specified in subsection (c)(5), but is not determined under 
1261 § 2359b CH. 139—RESEARCH AND DEVELOPMENT 

a full review and evaluation to satisfy such criteria, the following 

provisions apply: 

(1) The office carrying out the full review and evaluation 

shall provide to the Panel that conducted the preliminary evaluation a statement containing a summary of the rationale for 

the unfavorable evaluation. 

(2) If the Panel disagrees with the rationale provided 

under paragraph (1), the Panel may return the challenge proposal to the office for further consideration. 

(g) ACCESS TO TECHNICAL RESOURCES.—(1) Under procedures 

established by the Under Secretary, the technical resources of the 

laboratories, research, development, and engineering centers, test 

and evaluation activities, and other elements of the Department 

may be called upon to support the activities of the Challenge Program. 

(2) Funds available to carry out this program may be used to 

compensate such laboratories, centers, activities, and elements for 

technical assistance provided to a Panel pursuant to paragraph (1). 

(h) CONFLICTS OF INTEREST AND CONFIDENTIALITY.—In carrying out each preliminary evaluation under subsection (c) and full 

review under subsection (d), the Under Secretary shall ensure the 

elimination of conflicts of interest and that the identity of any person or activity submitting a challenge proposal is not disclosed outside the Federal Government, prior to contract award, without the 

consent of the person or activity. For purposes of the proceeding 

sentence, the term ‘‘Federal Government’’ includes both employees 

of the Federal Government and employees of Federal Government 

contractors providing advisory and assistance services as described 

in part 37 of the Federal Acquisition Regulation. 

(i) LIMITATION ON USE OF FUNDS.—Funds made available for 

the Challenge Program may be used only for activities authorized 

by this section, and not for implementation of challenge proposals. 

(j) SYSTEM DEFINED.—In this section, the term ‘‘system’’— 

(1) means— 

(A) the organization of hardware, software, material, 

facilities, personnel, data, and services needed to perform 

a designated function with specified results (such as the 

gathering of specified data, its processing, and its delivery 

to users); or 

(B) a combination of two or more interrelated pieces 

(or sets) of equipment arranged in a functional package to 

perform an operational function or to satisfy a requirement; and 

(2) includes a major system (as defined in section 2302(5) 

of this title). 

(k) PILOT PROGRAM FOR PROGRAMS OTHER THAN MAJOR DEFENSE ACQUISITION PROGRAMS.— 

(1) IN GENERAL.—The Under Secretary of Defense for Acquisition, Technology, and Logistics shall carry out a pilot program to expand the use of the authority provided in this section to provide opportunities for the introduction of innovative 

and cost-saving approaches to programs other than major defense acquisition programs through the submission, review, 
§ 2360 CH. 139—RESEARCH AND DEVELOPMENT 1262 

2 In paragraph (4)(A), ‘‘section 4 of the Office of Federal Procurement Policy Act (41 U.S.C. 

403)’’ should be ‘‘section 110 of title 41’’. 3 In paragraph (4)(B), a period should probably appear at the end. 

and implementation, where appropriate, of qualifying proposals. 

(2) QUALIFYING PROPOSALS.—For purposes of this subsection, a qualifying proposal is an offer to supply a nondevelopmental item that— 

(A) is evaluated as achieving a level of performance 

that is at least equal to the level of performance of an item 

being procured under a covered acquisition program and 

as providing savings in excess of 15 percent after considering all costs to the Government of implementing such 

proposal; or 

(B) is evaluated as achieving a level of performance 

that is significantly better than the level of performance of 

an item being procured under a covered acquisition program without any increase in cost to the Government. 

(3) REVIEW PROCEDURES.—The Under Secretary shall 

adopt modifications as may be needed to the procedures applicable to the Challenge Program to provide for Department of 

Defense review of, and action on, qualifying proposals. Such 

procedures shall include, at a minimum, the issuance of a 

broad agency announcement inviting interested parties to submit qualifying proposals in areas of interest to the Department. 

(4) DEFINITIONS.—In this subsection: 

(A) NONDEVELOPMENTAL ITEM.—The term ‘‘nondevelopmental item’’ has the meaning given that term in 

section 4 of the Office of Federal Procurement Policy Act 

(41 U.S.C. 403) 2. 

(B) COVERED ACQUISITION PROGRAM.—The term ‘‘covered acquisition program’’ means any acquisition program 

of the Department of Defense other than a major defense 

acquisition program, but does not include any contract 

awarded under an exception to competitive acquisition authorized by the Small Business Act (15 U.S.C. 631 et 

seq.) 3

(C) LEVEL OF PERFORMANCE.—The term ‘‘level of performance’’, with respect to a nondevelopmental item, 

means the extent to which the item demonstrates required 

item functional characteristics. 

(5) SUNSET.—The authority to carry out the pilot program 

under this subsection shall terminate on the date that is five 

years after the date of the enactment of this Act. 

(Added Pub. L. 107–314, div. A, title II, Sec. 243(a), Dec. 2, 2002, 116 Stat. 2495; amended Pub. 

L. 109–364, div. A, title II, Sec. 213(b), (d)–(g), Oct. 17, 2006, 120 Stat. 2121–2123; Pub. L. 110– 

417, [div. A], title VIII, Sec. 821, Oct. 14, 2008, 122 Stat. 4531; Pub. L. 111–383, div. A, title 

VIII, Sec. 827, Jan. 7, 2011, 124 Stat. 4270.) 

§ 2360. Research and development laboratories: contracts 

for services of university students 

(a) Subject to the availability of appropriations for such purpose, the Secretary of Defense may procure by contract under the 
1263 § 2361 CH. 139—RESEARCH AND DEVELOPMENT 

authority of this section the temporary or intermittent services of 

students at institutions of higher learning for the purpose of providing technical support at defense research and development laboratories. Such contracts may be made directly with such students 

or with nonprofit organizations employing such students. 

(b) Students providing services pursuant to a contract made 

under subsection (a) shall be considered to be employees for the 

purposes of chapter 81 of title 5, relating to compensation for work 

injuries, and to be employees of the government for the purposes 

of chapter 171 of title 28, relating to tort claims. Such students 

who are not otherwise employed by the Federal Government shall 

not be considered to be Federal employees for any other purpose. 

(c) The Secretary of Defense shall prescribe regulations to 

carry out this section. Such regulations shall include definitions for 

the purposes of this section of the terms ‘‘student’’, ‘‘institution of 

higher learning’’, and ‘‘nonprofit organization’’. 

(Added Pub. L. 97–86, title VI, Sec. 603(a), Dec. 1, 1981, 95 Stat. 1110.) 

§ 2361. Award of grants and contracts to colleges and universities: requirement of competition 

(a) The Secretary of Defense may not make a grant or award 

a contract to a college or university for the performance of research 

and development, or for the construction of any research or other 

facility, unless— 

(1) in the case of a grant, the grant is made using competitive procedures; and 

(2) in the case of a contract, the contract is awarded in accordance with section 2304 of this title (other than pursuant to 

subsection (c)(5) of that section). 

(b)(1) A provision of law may not be construed as modifying or 

superseding the provisions of subsection (a), or as requiring funds 

to be made available by the Secretary of Defense to a particular 

college or university by grant or contract, unless that provision of 

law— 

(A) specifically refers to this section; 

(B) specifically states that such provision of law modifies 

or supersedes the provisions of this section; and 

(C) specifically identifies the particular college or university involved and states that the grant to be made or the contract to be awarded, as the case may be, pursuant to such provision of law is being made or awarded in contravention of subsection (a). 

(2) A grant may not be made, or a contract awarded, pursuant 

to a provision of law that authorizes or requires the making of the 

grant, or the awarding of the contract, in a manner that is inconsistent with subsection (a) until— 

(A) the Secretary of Defense submits to Congress a notice 

in writing of the intent to make the grant or award the contract; and 

(B) a period of 180 days has elapsed after the date on 

which the notice is received by Congress. 

(Added Pub. L. 100–456, div. A, title II, Sec. 220(a), Sept. 29, 1988, 102 Stat. 1940; amended 

Pub. L. 101–189, div. A, title II, Sec. 252(a), (b)(1), (c)(1), Nov. 29, 1989, 103 Stat. 1404, 1405; 

Pub. L. 101–510, div. A, title XIII, Sec. 1311(4), Nov. 5, 1990, 104 Stat. 1669; Pub. L. 103–35, 

title II, Sec. 201(g)(5), May 31, 1993, 107 Stat. 100; Pub. L. 103–160, div. A, title VIII, Sec. 
§ 2362 CH. 139—RESEARCH AND DEVELOPMENT 1264 

4 In section 2362(a), ‘‘Director of Defense Research and Engineering’’ should be ‘‘Assistant Secretary of Defense for Research and Engineering’’. 

821(b), Nov. 30, 1993, 107 Stat. 1704; Pub. L. 103–337, div. A, title VIII, Sec. 813, Oct. 5, 1994, 

108 Stat. 2816; Pub. L. 104–106, div. A, title II, Sec. 264, title XV, Sec. 1502(a)(1), Feb. 10, 1996, 

110 Stat. 237, 502; Pub. L. 104–201, div. A, title II, Sec. 265, Sept. 23, 1996, 110 Stat. 2466.) 

§ 2362. Research and educational programs and activities: 

historically black colleges and universities and minority-serving institutions of higher education 

(a) PROGRAM ESTABLISHED.—The Secretary of Defense, acting 

through the Director of Defense Research and Engineering 4 and 

the Secretary of each military department, shall carry out a program to provide assistance to covered educational institutions to 

assist the Department in defense-related research, development, 

testing, and evaluation activities. 

(b) PROGRAM OBJECTIVE.—The objective of the program established under subsection (a) is to enhance defense-related research 

and education at covered educational institutions. Such objective 

shall be accomplished through initiatives designed to— 

(1) enhance the research and educational capabilities of 

such institutions in areas of importance to national defense, as 

determined by the Secretary; 

(2) encourage the participation of such institutions in the 

research, development, testing, and evaluation programs and 

activities of the Department of Defense; 

(3) increase the number of graduates from such institutions engaged in disciplines important to the national security 

functions of the Department of Defense, as determined by the 

Secretary; and 

(4) encourage research and educational collaborations between such institutions and other institutions of higher education, Government defense organizations, and the defense industry. 

(c) ASSISTANCE PROVIDED.—Under the program established by 

subsection (a), the Secretary of Defense may provide covered educational institutions with funding or technical assistance, including 

any of the following: 

(1) Support for research, development, testing, evaluation, 

or educational enhancements in areas important to national 

defense through the competitive awarding of grants, cooperative agreements, contracts, scholarships, fellowships, or the acquisition of research equipment or instrumentation. 

(2) Support to assist in the attraction and retention of faculty in scientific disciplines important to the national security 

functions of the Department of Defense. 

(3) Establishing partnerships between such institutions 

and defense laboratories, Government defense organizations, 

the defense industry, and other institutions of higher education 

in research, development, testing, and evaluation in areas important to the national security functions of the Department of 

Defense. 

(4) Other such non-monetary assistance as the Secretary 

finds appropriate to enhance defense-related research, development, testing, and evaluation activities at such institutions. 
1265 § 2364 CH. 139—RESEARCH AND DEVELOPMENT 

(d) PRIORITY FOR FUNDING.—The Secretary of Defense may establish procedures under which the Secretary may give priority in 

providing funding under this section to institutions that have not 

otherwise received a significant amount of funding from the Department of Defense for research, development, testing, and evaluation programs supporting the national security functions of the 

Department. 

(e) DEFINITION OF COVERED EDUCATIONAL INSTITUTION.—In 

this section the term ‘‘covered educational institution’’ means— 

(1) an institution of higher education eligible for assistance 

under title III or V of the Higher Education Act of 1965 (20 

U.S.C. 1051 et seq.); or 

(2) an accredited postsecondary minority institution. 

(Added Pub. L. 111–84, div. A, title II, Sec. 252(a), Oct. 28, 2009, 123 Stat. 2242; amended Pub. 

L. 111–383, div. A, title X, Sec. 1075(b)(32), Jan. 7, 2011, 124 Stat. 4370.) 

[§ 2363. Repealed. Pub. L. 102–484, div. D, title XLII, Sec. 

4224(c), 4271(a)(2), Oct. 23, 1992, 106 Stat. 2683, 

2695] 

§ 2364. Coordination and communication of defense research activities 

(a) COORDINATION OF DEPARTMENT OF DEFENSE TECHNOLOGICAL DATA.—The Secretary of Defense shall promote, monitor, 

and evaluate programs for the communication and exchange of 

technological data— 

(1) among the Defense research facilities, combatant commands, and other organizations that are involved in developing 

for the Department of Defense the technological requirements 

for new items for use by combat forces; and 

(2) among Defense research facilities and other offices, 

agencies, and bureaus in the Department that are engaged in 

related technological matters. 

(b) FUNCTIONS OF DEFENSE RESEARCH FACILITIES.—The Secretary of Defense shall ensure, to the maximum extent practicable— 

(1) that Defense research facilities are assigned broad mission requirements rather than specific hardware needs; 

(2) that appropriate personnel of such facilities are assigned to serve as consultants on component and support system standardization; 

(3) that the managers of such facilities have broad latitude 

to choose research and development projects; 

(4) that technology position papers prepared by Defense research facilities are readily available to all combatant commands and to contractors who submit bids or proposals for Department of Defense contracts; and 

(5) that, in order to promote increased consideration of 

technological issues early in the development process, any position paper prepared by a Defense research facility on a technological issue relating to a major weapon system, and any technological assessment made by such facility in the case of such 

component, is made a part of the records considered for the 

purpose of making acquisition program decisions. 
§ 2365 CH. 139—RESEARCH AND DEVELOPMENT 1266 

5 In section 2365(a), ‘‘of Defense for Research and Engineering’’ should appear after ‘‘Assistant 

Secretary’’. 6 In section 2365(d)(3)(A), ‘‘Director’’ should be ‘‘Assistant Secretary’’. 

(c) DEFINITIONS.—In this section: 

(1) The term ‘‘Defense research facility’’ means a Department of Defense facility which performs or contracts for the 

performance of— 

(A) basic research; or 

(B) applied research known as exploratory development. 

(2) The term ’’acquisition program decision’’ has the meaning prescribed by the Secretary of Defense in regulations.’’ 

(Added Pub. L. 99–661, div. A, title II, Sec. 234(c)(1), Nov. 14, 1986, 100 Stat. 3848; amended 

Pub. L. 100–26, Sec. 3(1)(A), 7(a)(9), Apr. 21, 1987, 101 Stat. 273, 278; Pub. L. 100–180, div. 

A, title XII, Sec. 1231(10)(A), (B), Dec. 4, 1987, 101 Stat. 1160; Pub. L. 104–106, div. A, title 

VIII, Sec. 805, Feb. 10, 1996, 110 Stat. 390.) 

§ 2365. Global Research Watch Program 

(a) PROGRAM.—The Assistant Secretary 5 shall carry out a 

Global Research Watch program in accordance with this section. 

(b) PROGRAM GOALS.—The goals of the program are as follows: 

(1) To monitor and analyze the basic and applied research 

activities and capabilities of foreign nations in areas of military 

interest, including allies and competitors. 

(2) To provide standards for comparison and comparative 

analysis of research capabilities of foreign nations in relation 

to the research capabilities of the United States. 

(3) To assist Congress and Department of Defense officials 

in making investment decisions for research in technical areas 

where the United States may not be the global leader. 

(4) To identify areas where significant opportunities for cooperative research may exist. 

(5) To coordinate and promote the international cooperative research and analysis activities of each of the armed forces 

and Defense Agencies. 

(6) To establish and maintain an electronic database on 

international research capabilities, comparative assessments of 

capabilities, cooperative research opportunities, and ongoing 

cooperative programs. 

(c) FOCUS OF PROGRAM.—The program shall be focused on research and technologies at a technical maturity level equivalent to 

Department of Defense basic and applied research programs. 

(d) COORDINATION.—(1) The Assistant Secretary shall coordinate the program with the international cooperation and analysis 

activities of the military departments and Defense Agencies. 

(2) The Secretaries of the military departments and the directors of the Defense Agencies shall provide the Assistant Secretary 

of Defense for Research and Engineering such assistance as the Assistant Secretary may require for purposes of the program. 

(3)(A) Funds available to a military department for a fiscal 

year for monitoring or analyzing the research activities and capabilities of foreign nations may not be obligated or expended until 

the Director 6 certifies to the Under Secretary of Defense for Acquisition, Technology, and Logistics that the Secretary of such military 
1267 § 2366 CH. 139—RESEARCH AND DEVELOPMENT 

department has provided the assistance required under paragraph 

(2). 

(B) The limitation in subparagraph (A) shall not be construed 

to alter or effect the availability to a military department of funds 

for intelligence activities. 

(e) CLASSIFICATION OF DATABASE INFORMATION.—Information 

in electronic databases of the Global Research Watch program shall 

be maintained in unclassified form and, as determined necessary 

by the Assistant Secretary, in classified form in such databases. 

(f) TERMINATION.—The requirement to carry out the program 

under this section shall terminate on September 30, 2015. 

(Added Pub. L. 108–136, div. A, title II, Sec. 231(a), Nov. 24, 2003, 117 Stat. 1421; amended 

Pub. L. 109–364, div. A, title II, Sec. 232, Oct. 17, 2006, 120 Stat. 2134; Pub. L. 111–84, div. 

A, title II, Sec. 211, Oct. 28, 2009, 123 Stat. 2225; Pub. L. 111–383, div. A, title IX, Sec. 901(j)(3), 

Jan. 7, 2011, 124 Stat. 4324.) 

§ 2366. Major systems and munitions programs: survivability testing and lethality testing required before 

full-scale production 

(a) REQUIREMENTS.—(1) The Secretary of Defense shall provide 

that— 

(A) a covered system may not proceed beyond low-rate initial production until realistic survivability testing of the system is completed in accordance with this section and the report 

required by subsection (d) with respect to that testing is submitted in accordance with that subsection; and 

(B) a major munition program or a missile program may 

not proceed beyond low-rate initial production until realistic 

lethality testing of the program is completed in accordance 

with this section and the report required by subsection (d) with 

respect to that testing is submitted in accordance with that 

subsection. 

(2) The Secretary of Defense shall provide that a covered product improvement program may not proceed beyond low-rate initial 

production until— 

(A) in the case of a product improvement to a covered system, realistic survivability testing is completed in accordance 

with this section; and 

(B) in the case of a product improvement to a major munitions program or a missile program, realistic lethality testing 

is completed in accordance with this section. 

(b) TEST GUIDELINES.—(1) Survivability and lethality tests required under subsection (a) shall be carried out sufficiently early 

in the development phase of the system or program (including a 

covered product improvement program) to allow any design deficiency demonstrated by the testing to be corrected in the design of 

the system, munition, or missile (or in the product modification or 

upgrade to the system, munition, or missile) before proceeding beyond low-rate initial production. 

(2) The costs of all tests required under that subsection shall 

be paid from funds available for the system being tested. 

(c) WAIVER AUTHORITY.—(1) The Secretary of Defense may 

waive the application of the survivability and lethality tests of this 

section to a covered system, munitions program, missile program, 

or covered product improvement program if the Secretary deter-
§ 2366 CH. 139—RESEARCH AND DEVELOPMENT 1268 

mines that live-fire testing of such system or program would be unreasonably expensive and impractical and submits a certification of 

that determination to Congress— 

(A) before Milestone B approval for the system or program; 

or 

(B) in the case of a system or program initiated at— 

(i) Milestone B, as soon as is practicable after the 

Milestone B approval; or 

(ii) Milestone C, as soon as is practicable after the 

Milestone C approval. 

(2) In the case of a covered system (or covered product improvement program for a covered system), the Secretary may waive 

the application of the survivability and lethality tests of this section to such system or program and instead allow testing of the 

system or program in combat by firing munitions likely to be encountered in combat at components, subsystems, and subassemblies, together with performing design analyses, modeling and simulation, and analysis of combat data. Such alternative testing may 

not be carried out in the case of any covered system (or covered 

product improvement program for a covered system) unless the 

Secretary certifies to Congress, before the system or program enters system development and demonstration, that the survivability 

and lethality testing of such system or program otherwise required 

by this section would be unreasonably expensive and impracticable. 

(3) The Secretary shall include with any certification under 

paragraph (1) or (2) a report explaining how the Secretary plans 

to evaluate the survivability or the lethality of the system or program and assessing possible alternatives to realistic survivability 

testing of the system or program. 

(4) In time of war or mobilization, the President may suspend 

the operation of any provision of this section. 

(d) REPORTING TO CONGRESS.—(1) At the conclusion of survivability or lethality testing under subsection (a), the Secretary of 

Defense shall submit a report on the testing to the congressional 

defense committees. Each such report shall describe the results of 

the survivability or lethality testing and shall give the Secretary’s 

overall assessment of the testing. 

(2) If a decision is made within the Department of Defense to 

proceed to operational use of a system, or to make procurement 

funds available for a system, before Milestone C approval of that 

system, the Secretary of Defense shall submit to the congressional 

defense committees, as soon as practicable after such decision, the 

following: 

(A) A report describing the status of survivability and live 

fire testing of that system. 

(B) The report required under paragraph (1). 

(e) DEFINITIONS.—In this section: 

(1) The term ‘‘covered system’’ means— 

(A) a vehicle, weapon platform, or conventional weapon system that— 

(i) includes features designed to provide some degree of protection to users in combat; and 

(ii) is a major system as defined in section 2302(5) 

of this title; or 
1269 § 2366 CH. 139—RESEARCH AND DEVELOPMENT 

(B) any other system or program designated by the 

Secretary of Defense for purposes of this section. 

(2) The term ‘‘major munitions program’’ means— 

(A) a munition program for which more than 1,000,000 

rounds are planned to be acquired; or 

(B) a conventional munitions program that is a major 

system within the meaning of that term in section 2302(5) 

of this title. 

(3) The term ‘‘realistic survivability testing’’ means, in the 

case of a covered system (or a covered product improvement 

program for a covered system), testing for vulnerability of the 

system in combat by firing munitions likely to be encountered 

in combat (or munitions with a capability similar to such munitions) at the system configured for combat, with the primary 

emphasis on testing vulnerability with respect to potential user 

casualties and taking into equal consideration the susceptibility to attack and combat performance of the system. 

(4) The term ‘‘realistic lethality testing’’ means, in the case 

of a major munitions program or a missile program (or a covered product improvement program for such a program), testing for lethality by firing the munition or missile concerned at 

appropriate targets configured for combat. 

(5) The term ‘‘configured for combat’’, with respect to a 

weapon system, platform, or vehicle, means loaded or equipped 

with all dangerous materials (including all flammables and explosives) that would normally be on board in combat. 

(6) The term ‘‘covered product improvement program’’ 

means a program under which— 

(A) a modification or upgrade will be made to a covered system which (as determined by the Secretary of Defense) is likely to affect significantly the survivability of 

such system; or 

(B) a modification or upgrade will be made to a major 

munitions program or a missile program which (as determined by the Secretary of Defense) is likely to affect significantly the lethality of the munition or missile produced 

under the program. 

(7) The term ‘‘Milestone B approval’’ means a decision to 

enter into system development and demonstration pursuant to 

guidance prescribed by the Secretary of Defense for the management of Department of Defense acquisition programs. 

(8) The term ‘‘Milestone C approval’’ means a decision to 

enter into production and deployment pursuant to guidance 

prescribed by the Secretary of Defense for the management of 

Department of Defense acquisition programs. 

(Added Pub. L. 99–500, Sec. 101(c) [title X, Sec. 910(a)(1)], Oct. 18, 1986, 100 Stat. 1783–82, 

1783–143, and Pub. L. 99–591, Sec. 101(c) [title X, Sec. 910(a)(1)], Oct. 30, 1986, 100 Stat. 3341– 

82, 3341–143; Pub. L. 99–661, div. A, title IX, formerly title IV, Sec. 910(a)(1), Nov. 14, 1986, 

100 Stat. 3923, renumbered title IX, Pub. L. 100–26, Sec. 3(5), Apr. 21, 1987, 101 Stat. 273; 

amended Pub. L. 100–180, div. A, title VIII, Sec. 802, title XII, Sec. 1231(11), Dec. 4, 1987, 101 

Stat. 1123, 1160; Pub. L. 100–456, div. A, title XII, Sec. 1233(l)(3), Sept. 29, 1988, 102 Stat. 

2058; Pub. L. 101–189, div. A, title VIII, Sec. 802(c)(1)–(4)(A), 804, Nov. 29, 1989, 103 Stat. 

1486, 1488; Pub. L. 101–510, div. A, title XIV, Sec. 1484(h)(7), Nov. 5, 1990, 104 Stat. 1718; 

Pub. L. 103–160, div. A, title VIII, Sec. 828(d)(2), Nov. 30, 1993, 107 Stat. 1715; Pub. L. 103– 

355, title III, Sec. 3014, Oct. 13, 1994, 108 Stat. 3332; Pub. L. 104–106, div. A, title XV, Sec. 

1502(a)(18), Feb. 10, 1996, 110 Stat. 504; Pub. L. 106–65, div. A, title X, Sec. 1067(1), Oct. 5, 

1999, 113 Stat. 774; Pub. L. 107–107, div. A, title VIII, Sec. 821(a), Dec. 28, 2001, 115 Stat. 
§ 2366a CH. 139—RESEARCH AND DEVELOPMENT 1270 

1181; Pub. L. 107–314, div. A, title VIII, Sec. 818, Dec. 2, 2002, 116 Stat. 2611; Pub. L. 108– 

136, div. A, title X, Sec. 1043(b)(13), Nov. 24, 2003, 117 Stat. 1611; Pub. L. 110–417, [div. A], 

title II, Sec. 251(a), (b), Oct. 14, 2008, 122 Stat. 4400.) 

§ 2366a. Major defense acquisition programs: certification 

required before Milestone A or Key Decision Point 

A approval 

(a) CERTIFICATION.—A major defense acquisition program may 

not receive Milestone A approval, or Key Decision Point A approval 

in the case of a space program, or otherwise be initiated prior to 

Milestone B approval, or Key Decision Point B approval in the case 

of a space program, until the Milestone Decision Authority certifies, after consultation with the Joint Requirements Oversight 

Council on matters related to program requirements and military 

needs— 

(1) that the program fulfills an approved initial capabilities 

document; 

(2) that the program is being executed by an entity with 

a relevant core competency as identified by the Secretary of 

Defense under section 118b of this title; 

(3) if the program duplicates a capability already provided 

by an existing system, the duplication provided by such program is necessary and appropriate; 

(4) that an analysis of alternatives has been performed 

consistent with study guidance developed by the Director of 

Cost Assessment and Program Evaluation; and 

(5) that a cost estimate for the program has been submitted, with the concurrence of the Director of Cost Assessment and Program Evaluation, and that the level of resources 

required to develop and procure the program is consistent with 

the priority level assigned by the Joint Requirements Oversight Council. 

(b) NOTIFICATION.—(1) With respect to a major defense acquisition program certified by the Milestone Decision Authority under 

subsection (a) or a designated major subprogram of such program, 

if the projected cost of the program or subprogram, at any time 

prior to Milestone B approval, exceeds the cost estimate for the 

program submitted at the time of the certification by at least 25 

percent, or the program manager determines that the period of 

time required for the delivery of an initial operational capability is 

likely to exceed the schedule objective established pursuant to section 181(b)(5) of this title by more than 25 percent, the program 

manager for the program concerned shall notify the Milestone Decision Authority. The Milestone Decision Authority, in consultation 

with the Joint Requirements Oversight Council on matters related 

to program requirements and military needs, shall determine 

whether the level of resources required to develop and procure the 

program remains consistent with the priority level assigned by the 

Joint Requirements Oversight Council. The Milestone Decision Authority may withdraw the certification concerned or rescind Milestone A approval (or Key Decision Point A approval in the case of 

a space program) if the Milestone Decision Authority determines 

that such action is in the interest of national defense. 

(2) Not later than 30 days after a program manager submits 

a notification to the Milestone Decision Authority pursuant to para-
1271 § 2366b CH. 139—RESEARCH AND DEVELOPMENT 

graph (1) with respect to a major defense acquisition program or 

designated major subprogram, the Milestone Decision Authority 

shall submit to the congressional defense committees a report 

that— 

(A) identifies the root causes of the cost or schedule growth 

in accordance with applicable policies, procedures, and guidance; 

(B) identifies appropriate acquisition performance measures for the remainder of the development of the program; and 

(C) includes one of the following: 

(i) A written certification (with a supporting explanation) stating that— 

(I) the program is essential to national security; 

(II) there are no alternatives to the program that 

will provide acceptable military capability at less cost; 

(III) new estimates of the development cost or 

schedule, as appropriate, are reasonable; and 

(IV) the management structure for the program is 

adequate to manage and control program development 

cost and schedule. 

(ii) A plan for terminating the development of the program or withdrawal of Milestone A approval, or Key Decision Point A approval in the case of a space program, if the 

Milestone Decision Authority determines that such action 

is in the interest of national defense. 

(c) DEFINITIONS.—In this section: 

(1) The term ‘‘major defense acquisition program’’ has the 

meaning provided in section 2430 of this title. 

(2) The term ‘‘designated major subprogram’’ means a 

major subprogram of a major defense acquisition program designated under section 2430a(a)(1) of this title. 

(3) The term ‘‘initial capabilities document’’ means any capabilities requirement document approved by the Joint Requirements Oversight Council that establishes the need for a 

materiel approach to resolve a capability gap. 

(4) The term ‘‘technology development program’’ means a 

coordinated effort to assess technologies and refine user performance parameters to fulfill a capability gap identified in an 

initial capabilities document. 

(5) The term ‘‘entity’’ means an entity listed in section 

118b(c)(3) of this title. 

(6) The term ‘‘Milestone B approval’’ has the meaning provided that term in section 2366(e)(7) of this title. 

(Added Pub. L. 110–181, div. A, title IX, Sec. 943(a)(1), Jan. 28, 2008, 122 Stat. 288, Sec. 2366b; 

renumbered Sec. 2366a and amended Pub. L. 110–417, [div. A], title VIII, Sec. 813(b), (e)(1), 

Oct. 14, 2008, 122 Stat. 4527; Pub. L. 111–23, title I, Sec. 101(d)(3), title II, Secs. 201(e), 204(a), 

(b), May 22, 2009, 123 Stat. 1710, 1720, 1723; Pub. L. 111–383, div. A, title VIII, Sec. 814(b), 

title X, Sec. 1075(b)(33), Jan. 7, 2011, 124 Stat. 4266, 4370.) 

§ 2366b. Major defense acquisition programs: certification 

required before Milestone B or Key Decision Point 

B approval 

(a) CERTIFICATION.—A major defense acquisition program may 

not receive Milestone B approval, or Key Decision Point B approval 
§ 2366b CH. 139—RESEARCH AND DEVELOPMENT 1272 

in the case of a space program, until the milestone decision authority— 

(1) has received a business case analysis and certifies on 

the basis of the analysis that— 

(A) the program is affordable when considering the 

ability of the Department of Defense to accomplish the program’s mission using alternative systems; 

(B) appropriate trade-offs among cost, schedule, and 

performance objectives have been made to ensure that the 

program is affordable when considering the per unit cost 

and the total acquisition cost in the context of the total resources available during the period covered by the futureyears defense program submitted during the fiscal year in 

which the certification is made; 

(C) reasonable cost and schedule estimates have been 

developed to execute, with the concurrence of the Director 

of Cost Assessment and Program Evaluation, the product 

development and production plan under the program; and 

(D) funding is available to execute the product development and production plan under the program, through 

the period covered by the future-years defense program 

submitted during the fiscal year in which the certification 

is made, consistent with the estimates described in subparagraph (C) for the program; 

(2) has received a preliminary design review and conducted a formal post-preliminary design review assessment, 

and certifies on the basis of such assessment that the program 

demonstrates a high likelihood of accomplishing its intended 

mission; and 

(3) further certifies that— 

(A) appropriate market research has been conducted 

prior to technology development to reduce duplication of 

existing technology and products; 

(B) the Department of Defense has completed an analysis of alternatives with respect to the program; 

(C) the Joint Requirements Oversight Council has accomplished its duties with respect to the program pursuant to section 181(b) of this title, including an analysis of 

the operational requirements for the program; 

(D) the technology in the program has been demonstrated in a relevant environment, as determined by the 

Milestone Decision Authority on the basis of an independent review and assessment by the Assistant Secretary 

of Defense for Research and Engineering; and 

(E) the program complies with all relevant policies, 

regulations, and directives of the Department of Defense. 

(b) CHANGES TO CERTIFICATION.—(1) The program manager for 

a major defense acquisition program that has received certification 

under subsection (a) shall immediately notify the milestone decision authority of any changes to the program or a designated major 

subprogram of such program that— 

(A) alter the substantive basis for the certification of the 

milestone decision authority relating to any component of such 
1273 § 2366b CH. 139—RESEARCH AND DEVELOPMENT 

certification specified in paragraph (1) or (2) of subsection (a); 

or 

(B) otherwise cause the program or subprogram to deviate 

significantly from the material provided to the milestone decision authority in support of such certification. 

(2) Upon receipt of information under paragraph (1), the milestone decision authority may withdraw the certification concerned 

or rescind Milestone B approval (or Key Decision Point B approval 

in the case of a space program) if the milestone decision authority 

determines that such certification or approval is no longer valid. 

(c) SUBMISSION TO CONGRESS.—(1) The certification required 

under subsection (a) with respect to a major defense acquisition 

program shall be submitted to the congressional defense committees with the first Selected Acquisition Report submitted under section 2432 of this title after completion of the certification. 

(2) A summary of any information provided to the milestone 

decision authority pursuant to subsection (b) and a description of 

the actions taken as a result of such information shall be submitted 

with the first Selected Acquisition Report submitted under section 

2432 of this title after receipt of such information by the milestone 

decision authority. 

(d) WAIVER FOR NATIONAL SECURITY.—(1) The milestone decision authority may, at the time of Milestone B approval (or Key 

Decision Point B approval in the case of a space program) or at the 

time that such milestone decision authority withdraws a certification or rescinds Milestone B approval (or Key Decision Point B 

approval in the case of a space program) pursuant to subsection 

(b)(2), waive the applicability to a major defense acquisition program of one or more components (as specified in paragraph (1), (2), 

or (3) of subsection (a)) of the certification requirement if the milestone decision authority determines that, but for such a waiver, the 

Department would be unable to meet critical national security objectives. 

(2) Whenever the milestone decision authority makes such a 

determination and authorizes such a waiver— 

(A) the waiver, the determination, and the reasons for the 

determination shall be submitted in writing to the congressional defense committees within 30 days after the waiver is 

authorized; and 

(B) the milestone decision authority shall review the program not less often than annually to determine the extent to 

which such program currently satisfies the certification components specified in paragraphs (1), (2), and (3) of subsection (a) 

until such time as the milestone decision authority determines 

that the program satisfies all such certification components. 

(e) DESIGNATION OF CERTIFICATION STATUS IN BUDGET DOCUMENTATION.—Any budget request, budget justification material, 

budget display, reprogramming request, Selected Acquisition Report, or other budget documentation or performance report submitted by the Secretary of Defense to the President regarding a 

major defense acquisition program receiving a waiver pursuant to 

subsection (d) shall prominently and clearly indicate that such program has not fully satisfied the certification requirements of this 

section until such time as the milestone decision authority makes 
§ 2367 CH. 139—RESEARCH AND DEVELOPMENT 1274 

the determination that such program has satisfied all such certification components. 

(f) NONDELEGATION.—The milestone decision authority may 

not delegate the certification requirement under subsection (a) or 

the authority to waive any component of such requirement under 

subsection (d). 

(g) DEFINITIONS.—In this section: 

(1) The term ‘‘major defense acquisition program’’ means a 

Department of Defense acquisition program that is a major defense acquisition program for purposes of section 2430 of this 

title. 

(2) The term ‘‘designated major subprogram’’ means a 

major subprogram of a major defense acquisition program designated under section 2430a(a)(1) of this title. 

(3) The term ‘‘milestone decision authority’’, with respect 

to a major defense acquisition program, means the individual 

within the Department of Defense designated with overall responsibility for the program. 

(4) The term ‘‘Milestone B approval’’ has the meaning provided that term in section 2366(e)(7) of this title. 

(5) The term ‘‘Key Decision Point B’’ means the official program initiation of a National Security Space program of the 

Department of Defense, which triggers a formal review to determine maturity of technology and the program’s readiness to 

begin the preliminary system design. 

(Added Pub. L. 109–163, div. A, title VIII, Sec. 801(a), Jan. 6, 2006, 119 Stat. 3366, Sec. 2366a; 

amended Pub. L. 109–364, div. A, title VIII, Sec. 805, Oct. 17, 2006, 120 Stat. 2314; Pub. L. 

110–181, div. A, title VIII, Sec. 812, Jan. 28, 2008, 122 Stat. 219; renumbered Sec. 2366b, Pub. 

L. 110–417, [div. A], title VIII, Sec. 813(a), (b), Oct. 14, 2008, 122 Stat. 4527; Pub. L. 111–23, 

title I, Sec. 101(d)(4), title II, Secs. 201(f), 205(a), May 22, 2009, 123 Stat. 1710, 1720, 1724; 

Pub. L. 111–383, div. A, title VIII, Secs. 813(d)(1), 814(c), title IX, Sec. 901(j)(4), title X, Sec. 

1075(k)(1), Jan. 7, 2011, 124 Stat. 4265, 4266, 4324, 4378.) 

§ 2367. Use of federally funded research and development 

centers 

(a) LIMITATION ON USE OF CENTERS.—Except as provided in 

subsection (b), the Secretary of Defense may not place work with 

a federally funded research and development center unless such 

work is within the purpose, mission, and general scope of effort of 

such center as established in the sponsoring agreement of the Department of Defense with such center. 

(b) EXCEPTION FOR APPLIED SCIENTIFIC RESEARCH.—This section does not apply to a federally funded research and development 

center that performs applied scientific research under laboratory 

conditions. 

(c) LIMITATION ON CREATION OF NEW CENTERS.—(1) The head 

of an agency may not obligate or expend amounts appropriated to 

the Department of Defense for purposes of operating a federally 

funded research center that was not in existence before June 2, 

1986, until— 

(A) the head of the agency submits to Congress a report 

with respect to such center that describes the purpose, mission, 

and general scope of effort of the center; and 

(B) a period of 60 days beginning on the date such report 

is received by Congress has elapsed. 
1275 § 2371 CH. 139—RESEARCH AND DEVELOPMENT 

(2) In this subsection, the term ‘‘head of an agency’’ has the 

meaning given such term in section 2302(1) of this title. 

(d) IDENTIFICATION TO CONGRESS OF FFRDC WORKLOAD EFFORT.—After the close of a fiscal year, and not later than January 

1 of the next year, the Secretary shall submit to the Committees 

on Armed Services and the Committee on Armed Services and the 

Committee on Appropriations of the Senate and the Committee on 

Armed Services and the Committee on Appropriations of the House 

of Representatives a report setting forth the actual obligations and 

the actual man-years of effort expended at each federally funded 

research and development center during that fiscal year. 

(Added Pub. L. 99–500, Sec. 101(c) [title X, Sec. 912(a)(1)], Oct. 18, 1986, 100 Stat. 1783–82, 

1783–146, and Pub. L. 99–591, Sec. 101(c) [title X, Sec. 912(a)(1)], Oct. 30, 1986, 100 Stat. 3341– 

82, 3341–146; Pub. L. 99–661, div. A, title IX, formerly title IV, Sec. 912(a)(1), Nov. 14, 1986, 

100 Stat. 3925, renumbered title IX, Pub. L. 100–26, Sec. 3(5), Apr. 21, 1987, 101 Stat. 273; 

amended Pub. L. 102–190, div. A, title II, Sec. 256(a)(1), Dec. 5, 1991, 105 Stat. 1330; Pub. L. 

104–106, div. A, title XV, Sec. 1502(a)(9), Feb. 10, 1996, 110 Stat. 503; Pub. L. 106–65, div. A, 

title X, Sec. 1067(1), Oct. 5, 1999, 113 Stat. 774; Pub. L. 107–314, div. A, title X, Sec. 

1041(a)(12), Dec. 2, 2002, 116 Stat. 2645.) 

[§ 2368. Repealed. Pub. L. 102–190, div. A, title VIII, Sec. 

821(c)(1), Dec. 5, 1991, 105 Stat. 1431] 

[§ 2369. Repealed. Pub. L. 103–355, title III, Sec. 3062(a), Oct. 

13, 1994, 108 Stat. 3336] 

[§ 2370. Repealed. Pub. L. 104–106, div. A, title X, Sec. 

1061(j)(1), Feb. 10, 1996, 110 Stat. 443] 

[§ 2370a. Repealed. Pub. L. 108–375, div. A, title X, Sec. 

1005(a), Oct. 28, 2004, 118 Stat. 2036] 

§ 2371. Research projects: transactions other than contracts 

and grants 

(a) ADDITIONAL FORMS OF TRANSACTIONS AUTHORIZED.—The 

Secretary of Defense and the Secretary of each military department 

may enter into transactions (other than contracts, cooperative 

agreements, and grants) under the authority of this subsection in 

carrying out basic, applied, and advanced research projects. The 

authority under this subsection is in addition to the authority provided in section 2358 of this title to use contracts, cooperative 

agreements, and grants in carrying out such projects. 

(b) EXERCISE OF AUTHORITY BY SECRETARY OF DEFENSE.—In 

any exercise of the authority in subsection (a), the Secretary of Defense shall act through the Defense Advanced Research Projects 

Agency or any other element of the Department of Defense that the 

Secretary may designate. 

(c) ADVANCE PAYMENTS.—The authority provided under subsection (a) may be exercised without regard to section 3324 of title 

31. 

(d) RECOVERY OF FUNDS.—(1) A cooperative agreement for performance of basic, applied, or advanced research authorized by section 2358 of this title and a transaction authorized by subsection 

(a) may include a clause that requires a person or other entity to 

make payments to the Department of Defense or any other department or agency of the Federal Government as a condition for receiving support under the agreement or other transaction. 
§ 2371 CH. 139—RESEARCH AND DEVELOPMENT 1276 

(2) The amount of any payment received by the Federal Government pursuant to a requirement imposed under paragraph (1) 

may be credited, to the extent authorized by the Secretary of Defense, to the appropriate account established under subsection (f). 

Amounts so credited shall be merged with other funds in the account and shall be available for the same purposes and the same 

period for which other funds in such account are available. 

(e) CONDITIONS.—(1) The Secretary of Defense shall ensure 

that— 

(A) to the maximum extent practicable, no cooperative 

agreement containing a clause under subsection (d) and no 

transaction entered into under subsection (a) provides for research that duplicates research being conducted under existing 

programs carried out by the Department of Defense; and 

(B) to the extent that the Secretary determines practicable, 

the funds provided by the Government under a cooperative 

agreement containing a clause under subsection (d) or a transaction authorized by subsection (a) do not exceed the total 

amount provided by other parties to the cooperative agreement 

or other transaction. 

(2) A cooperative agreement containing a clause under subsection (d) or a transaction authorized by subsection (a) may be 

used for a research project when the use of a standard contract, 

grant, or cooperative agreement for such project is not feasible or 

appropriate. 

(f) SUPPORT ACCOUNTS.—There is hereby established on the 

books of the Treasury separate accounts for each of the military departments and the Defense Advanced Research Projects Agency for 

support of research projects and development projects provided for 

in cooperative agreements containing a clause under subsection (d) 

and research projects provided for in transactions entered into 

under subsection (a). Funds in those accounts shall be available for 

the payment of such support. 

(g) REGULATIONS.—The Secretary of Defense shall prescribe 

regulations to carry out this section. 

(h) ANNUAL REPORT.—(1) Not later than 90 days after the end 

of each fiscal year, the Secretary of Defense shall submit to the 

Committee on Armed Services of the Senate and the Committee on 

Armed Services of the House of Representatives a report on the use 

by the Department of Defense during such fiscal year of— 

(A) cooperative agreements authorized under section 2358 

of this title that contain a clause under subsection (d); and 

(B) transactions authorized by subsection (a). 

(2) The report shall include, with respect to the cooperative 

agreements and other transactions covered by the report, the following: 

(A) The technology areas in which research projects were 

conducted under such agreements or other transactions. 

(B) The extent of the cost-sharing among Federal Government and non-Federal sources. 

(C) The extent to which the use of the cooperative agreements and other transactions— 
1277 § 2371a CH. 139—RESEARCH AND DEVELOPMENT 

(i) has contributed to a broadening of the technology 

and industrial base available for meeting Department of 

Defense needs; and 

(ii) has fostered within the technology and industrial 

base new relationships and practices that support the national security of the United States. 

(D) The total amount of payments, if any, that were received by the Federal Government during the fiscal year covered by the report pursuant to a clause described in subsection 

(d) that was included in the cooperative agreements and other 

transactions, and the amount of such payments, if any, that 

were credited to each account established under subsection (f). 

(3) No report is required under this subsection for a fiscal year 

after fiscal year 2006. 

(i) PROTECTION OF CERTAIN INFORMATION FROM DISCLOSURE.— 

(1) Disclosure of information described in paragraph (2) is not required, and may not be compelled, under section 552 of title 5 for 

five years after the date on which the information is received by 

the Department of Defense. 

(2)(A) Paragraph (1) applies to information described in subparagraph (B) that is in the records of the Department of Defense 

if the information was submitted to the Department in a competitive or noncompetitive process having the potential for resulting in 

an award, to the party submitting the information, of a cooperative 

agreement for performance of basic, applied, or advanced research 

authorized by section 2358 of this title or another transaction authorized by subsection (a). 

(B) The information referred to in subparagraph (A) is the following: 

(i) A proposal, proposal abstract, and supporting documents. 

(ii) A business plan submitted on a confidential basis. 

(iii) Technical information submitted on a confidential 

basis. 

(Added Pub. L. 101–189, div. A, title II, Sec. 251(a)(1), Nov. 29, 1989, 103 Stat. 1403; amended 

Pub. L. 101–510, div. A, title XIV, Sec. 1484(k)(9), Nov. 5, 1990, 104 Stat. 1719; Pub. L. 102– 

190, div. A, title VIII, Sec. 826, Dec. 5, 1991, 105 Stat. 1442; Pub. L. 102–484, div. A, title II, 

Sec. 217, Oct. 23, 1992, 106 Stat. 2352; Pub. L. 103–35, title II, Sec. 201(c)(4), May 31, 1993, 

107 Stat. 98; Pub. L. 103–160, div. A, title VIII, Sec. 827(b), title XI, Sec. 1182(a)(6), Nov. 30, 

1993, 107 Stat. 1712, 1771; Pub. L. 103–355, title I, Sec. 1301(b), Oct. 13, 1994, 108 Stat. 3285; 

Pub. L. 104–106, div. A, title XV, Sec. 1502(a)(1), Feb. 10, 1996, 110 Stat. 502; Pub. L. 104– 

201, div. A, title II, Sec. 267(a), (b), (c)(1)(A), title X, Sec. 1073(e)(1)(B), Sept. 23, 1996, 110 Stat. 

2467, 2468, 2658; Pub. L. 105–85, div. A, title VIII, Sec. 832, Nov. 18, 1997, 111 Stat. 1842; 

Pub. L. 105–261, div. A, title VIII, Sec. 817, Oct. 17, 1998, 112 Stat. 2089; Pub. L. 106–65, div. 

A, title X, Sec. 1067(1), Oct. 5, 1999, 113 Stat. 774; Pub. L. 108–136, div. A, title X, Sec. 

1031(a)(19), Nov. 24, 2003, 117 Stat. 1597.) 

§ 2371a. Cooperative research and development agreements 

under Stevenson-Wydler Technology Innovation 

Act of 1980 

The Secretary of Defense, in carrying out research projects 

through the Defense Advanced Research Projects Agency, and the 

Secretary of each military department, in carrying out research 

projects, may permit the director of any federally funded research 

and development center to enter into cooperative research and development agreements with any person, any agency or instrumentality of the United States, any unit of State or local government, 
§ 2372 CH. 139—RESEARCH AND DEVELOPMENT 1278 

and any other entity under the authority granted by section 12 of 

the Stevenson-Wydler Technology Innovation Act of 1980 (15 

U.S.C. 3710a). Technology may be transferred to a non-Federal 

party to such an agreement consistent with the provisions of sections 11 and 12 of such Act (15 U.S.C. 3710, 3710a). 

(Added and amended Pub. L. 104–201, div. A, title II, Sec. 267(c)(1)(A), (B), Sept. 23, 1996, 110 

Stat. 2468; Pub. L. 105–85, div. A, title X, Sec. 1073(a)(50), Nov. 18, 1997, 111 Stat. 1903.) 

§ 2372. Independent research and development and bid and 

proposal costs: payments to contractors 

(a) REGULATIONS.—The Secretary of Defense shall prescribe 

regulations governing the payment, by the Department of Defense, 

of expenses incurred by contractors for independent research and 

development and bid and proposal costs. 

(b) COSTS ALLOWABLE AS INDIRECT EXPENSES.—The regulations prescribed pursuant to subsection (a) shall provide that independent research and development and bid and proposal costs shall 

be allowable as indirect expenses on covered contracts to the extent 

that those costs are allocable, reasonable, and not otherwise unallowable by law or under the Federal Acquisition Regulation. 

(c) ADDITIONAL CONTROLS.—Subject to subsection (f), the regulations prescribed pursuant to subsection (a) may include the following provisions: 

(1) A limitation on the allowability of independent research 

and development and bid and proposal costs to work which the 

Secretary of Defense determines is of potential interest to the 

Department of Defense. 

(2) For each of fiscal years 1993 through 1995, a limitation 

in the case of major contractors that the total amount of the 

independent research and development and bid and proposal 

costs that are allowable as expenses of the contractor’s covered 

segments may not exceed the contractor’s adjusted maximum 

reimbursement amount. 

(3) Implementation of regular methods for transmission— 

(A) from the Department of Defense to contractors, in 

a reasonable manner, of timely and comprehensive information regarding planned or expected Department of Defense future needs; and 

(B) from contractors to the Department of Defense, in 

a reasonable manner, of information regarding progress by 

the contractor on the contractor’s independent research 

and development programs. 

(d) ADJUSTED MAXIMUM REIMBURSEMENT AMOUNT.—For purposes of subsection (c)(2), the adjusted maximum reimbursement 

amount for a major contractor for a fiscal year is the sum of— 

(1) the total amount of the allowable independent research 

and development and bid and proposal costs incurred by the 

contractor during the preceding fiscal year; 

(2) 5 percent of the amount referred to in paragraph (1); 

and 

(3) if the projected total amount of the independent research and development and bid and proposal costs incurred by 

the contractor for such fiscal year is greater than the total 

amount of the independent research and development and bid 
1279 § 2372 CH. 139—RESEARCH AND DEVELOPMENT 

and proposal costs incurred by the contractor for the preceding 

fiscal year, the amount that is determined by multiplying the 

amount referred to in paragraph (1) by the lesser of— 

(A) the percentage by which the projected total 

amount of such incurred costs for such fiscal year exceeds 

the total amount of the incurred costs of the contractor for 

the preceding fiscal year; or 

(B) the estimated percentage rate of inflation from the 

end of the preceding fiscal year to the end of the fiscal 

year for which the amount of the limitation is being computed. 

(e) WAIVER OF ADJUSTED MAXIMUM REIMBURSEMENT

AMOUNT.—The Secretary of Defense may waive the applicability of 

any limitation prescribed under subsection (c)(2) to any contractor 

for a fiscal year to the extent that the Secretary determines that 

allowing the contractor to exceed the contractor’s adjusted maximum reimbursement amount for such year— 

(1) is necessary to reimburse such contractor at least to 

the extent that would have been allowed under regulations as 

in effect on December 4, 1991; or 

(2) is otherwise in the best interest of the Government. 

(f) LIMITATIONS ON REGULATIONS.—Regulations prescribed pursuant to subsection (c) may not include provisions that would infringe on the independence of a contractor to choose which technologies to pursue in its independent research and development 

program. 

(g) ENCOURAGEMENT OF CERTAIN CONTRACTOR ACTIVITIES.— 

The regulations under subsection (a) shall encourage contractors to 

engage in research and development activities of potential interest 

to the Department of Defense, including activities intended to accomplish any of the following: 

(1) Enabling superior performance of future United States 

weapon systems and components. 

(2) Reducing acquisition costs and life-cycle costs of military systems. 

(3) Strengthening the defense industrial base and the technology base of the United States. 

(4) Enhancing the industrial competitiveness of the United 

States. 

(5) Promoting the development of technologies identified as 

critical under section 2506 of this title. 

(6) Increasing the development and promotion of efficient 

and effective applications of dual-use technologies. 

(7) Providing efficient and effective technologies for achieving such environmental benefits as improved environmental 

data gathering, environmental cleanup and restoration, pollution reduction in manufacturing, environmental conservation, 

and environmentally safe management of facilities. 

(h) MAJOR CONTRACTORS.—A contractor shall be considered to 

be a major contractor for the purposes of subsection (c) for any fiscal year if for the preceding fiscal year the contractor’s covered segments allocated to Department of Defense contracts a total of more 

than $10,000,000 in independent research and development and 

bid and proposal costs. 
§ 2373 CH. 139—RESEARCH AND DEVELOPMENT 1280 

(i) DEFINITIONS.—In this section: 

(1) COVERED CONTRACT.—The term ‘‘covered contract’’ has 

the meaning given that term in section 2324(l) of this title. 

(2) COVERED SEGMENT.—The term ‘‘covered segment’’, with 

respect to a contractor, means a product division of the contractor that allocated more than $1,000,000 in independent research and development and bid and proposal costs to Department of Defense contracts during the preceding fiscal year. In 

the case of a contractor that has no product divisions, such 

term means the contractor as a whole. 

(Added Pub. L. 101–510, div. A, title VIII, Sec. 824(a)(1), Nov. 5, 1990, 104 Stat. 1603; amended 

Pub. L. 102–25, title VII, Sec. 701(c), Apr. 6, 1991, 105 Stat. 113; Pub. L. 102–190, div. A, title 

VIII, Sec. 802(a)(1), Dec. 5, 1991, 105 Stat. 1412; Pub. L. 102–484, div. A, title X, Sec. 1052(27), 

Oct. 23, 1992, 106 Stat. 2500; Pub. L. 103–35, title II, Sec. 201(c)(5), May 31, 1993, 107 Stat. 

98; Pub. L. 104–106, div. D, title XLIII, Sec. 4321(b)(11), Feb. 10, 1996, 110 Stat. 672.) 

§ 2373. Procurement for experimental purposes 

(a) AUTHORITY.—The Secretary of Defense and the Secretaries 

of the military departments may each buy ordnance, signal, chemical activity, and aeronautical supplies, including parts and accessories, and designs thereof, that the Secretary of Defense or the 

Secretary concerned considers necessary for experimental or test 

purposes in the development of the best supplies that are needed 

for the national defense. 

(b) PROCEDURES.—Purchases under this section may be made 

inside or outside the United States and by contract or otherwise. 

Chapter 137 of this title applies only when such purchases are 

made in quantity. 

(Added Pub. L. 103–160, div. A, title VIII, Sec. 822(c)(1), Nov. 30, 1993, 107 Stat. 1706; amended 

Pub. L. 103–337, div. A, title X, Sec. 1070(g), Oct. 5, 1994, 108 Stat. 2859; Pub. L. 104–106, 

div. A, title VIII, Sec. 812, Feb. 10, 1996, 110 Stat. 395.) 

§ 2374. Merit-based award of grants for research and development 

(a) It is the policy of Congress that an agency named in section 

2303(a) of this title should not be required by legislation to award 

a new grant for research, development, test, or evaluation to a nonFederal Government entity. It is further the policy of Congress that 

any program, project, or technology identified in legislation be 

awarded through merit-based selection procedures. 

(b) A provision of law may not be construed as requiring a new 

grant to be awarded to a specified non-Federal Government entity 

unless that provision of law— 

(1) specifically refers to this subsection; 

(2) specifically identifies the particular non-Federal Government entity involved; and 

(3) specifically states that the award to that entity is required by such provision of law in contravention of the policy 

set forth in subsection (a). 

(c) For purposes of this section, a grant is a new grant unless 

the work provided for in the grant is a continuation of the work 

performed by the specified entity under a preceding grant. 

(d) This section shall not apply with respect to any grant that 

calls upon the National Academy of Sciences to investigate, examine, or experiment upon any subject of science or art of significance 
1281 § 2374a CH. 139—RESEARCH AND DEVELOPMENT 

to an agency named in section 2303(a) of this title and to report 

on such matters to the Congress or any agency of the Federal Government. 

(Added Pub. L. 103–355, title VII, Sec. 7203(a)(2), Oct. 13, 1994, 108 Stat. 3380.) 

§ 2374a. Prizes for advanced technology achievements 

(a) AUTHORITY.—The Secretary of Defense, acting through the 

Assistant Secretary of Defense for Research and Engineering and 

the service acquisition executive for each military department, may 

carry out programs to award cash prizes in recognition of outstanding achievements in basic, advanced, and applied research, 

technology development, and prototype development that have the 

potential for application to the performance of the military missions of the Department of Defense. 

(b) COMPETITION REQUIREMENTS.—Each program under subsection (a) shall use a competitive process for the selection of recipients of cash prizes. The process shall include the widely-advertised 

solicitation of submissions of research results, technology developments, and prototypes. 

(c) LIMITATIONS.—(1) The total amount made available for 

award of cash prizes in a fiscal year may not exceed $10,000,000. 

(2) No prize competition may result in the award of more than 

$1,000,000 in cash prizes without the approval of the Under Secretary of Defense for Acquisition, Technology, and Logistics. 

(d) RELATIONSHIP TO OTHER AUTHORITY.—A program under 

subsection (a) may be carried out in conjunction with or in addition 

to the exercise of any other authority of an official referred to in 

that subsection to acquire, support, or stimulate basic, advanced 

and applied research, technology development, or prototype 

projects. 

(e) ANNUAL REPORT.— 

(1) IN GENERAL.—Not later than March 1 of each year, the 

Secretary shall submit to the Committee on Armed Services of 

the Senate and the Committee on Armed Services of the House 

of Representatives a report on the activities carried out during 

the preceding fiscal year under the authority in subsection (a). 

(2) INFORMATION INCLUDED.—The report for a fiscal year 

under this subsection shall include, for each program under 

subsection (a), the following: 

(A) A description of the proposed goals of the competitions established under the program, including the areas 

of research, technology development, or prototype development to be promoted by such competitions and the relationship of such areas to the military missions of the Department of Defense. 

(B) An analysis of why the utilization of the authority 

in subsection (a) was the preferable method of achieving 

the goals described in subparagraph (A) as opposed to 

other authorities available to the Department, such as contracts, grants, and cooperative agreements. 

(C) The total amount of cash prizes awarded under the 

program, including a description of the manner in which 

the amounts of cash prizes awarded and claimed were allo-
§ 2374b CH. 139—RESEARCH AND DEVELOPMENT 1282 

cated among the accounts of the Department for recording 

as obligations and expenditures. 

(D) The methods used for the solicitation and evaluation of submissions under the program, together with an 

assessment of the effectiveness of such methods. 

(E) A description of the resources, including personnel 

and funding, used in the execution of the program, together with a detailed description of the activities for 

which such resources were used and an accounting of how 

funding for execution was allocated among the accounts of 

the Department for recording as obligations and expenditures. 

(F) A description of any plans to transition the technologies or prototypes developed as a result of the program 

into an acquisition program of the Department. 

(3) SUSPENSION OF AUTHORITY FOR FAILURE TO INCLUDE INFORMATION.—For each program under subsection (a), the authority to obligate or expend funds under that program is suspended as of the date specified in paragraph (1) if the Secretary does not, by that date, submit a report that includes, for 

that program, all the information required by paragraph (2). 

As of the date on which the Secretary does submit a report 

that includes, for that program, all the information required by 

paragraph (2), the suspension is lifted. 

(f) PERIOD OF AUTHORITY.—The authority to award prizes 

under subsection (a) shall terminate at the end of September 30, 

2013. 

(Added by Pub. L. 106–65, div. A, title II, Sec. 244(a), Oct. 5, 1999, 113 Stat. 552; amended Pub. 

L. 107–314, div. A, title II, Sec. 248(a), Dec. 2, 2002, 116 Stat. 2502; Pub. L. 108–136, div. A, 

title X, Sec. 1031(a)(20), Nov. 24, 2003, 117 Stat. 1598; Pub. L. 109–163, div. A, title II, Sec. 

257, Jan. 6, 2006, 119 Stat. 3184; Pub. L. 109–364, div. A, title II, Sec. 212, Oct. 17, 2006, 120 

Stat. 2119; Pub. L. 111–84, div. A, title II, Sec. 253, Oct. 28, 2009, 123 Stat. 2243; Pub. L. 111– 

383, div. A, title IX, Sec. 901(j)(4), Jan. 7, 2011, 124 Stat. 4324.) 

§ 2374b. Prizes for achievements in promoting science, 

mathematics, engineering, or technology education 

(a) AUTHORITY.—The Secretaries of the military departments 

and the heads of defense agencies may each carry out a program 

to award cash prizes in recognition of outstanding achievements 

that are designed to promote science, mathematics, engineering, or 

technology education in support of the missions of the Department 

of Defense. 

(b) COMPETITION REQUIREMENTS.—Each program under subsection (a) shall use a competitive process for the selection of recipients of cash prizes. 

(c) LIMITATION.—For any single program under subsection (a), 

the total amount made available for award of cash prizes in a fiscal 

year may not exceed $1,000,000. 

(d) RELATIONSHIP TO OTHER AUTHORITY.—The program under 

subsection (a) may be carried out in conjunction with or in addition 

to the exercise of any other authority to acquire, support, or stimulate basic and applied research, advanced technology development, 

or prototype development projects. 

(e) ANNUAL REPORT.—Promptly after the end of each fiscal 

year, each Secretary of a military department and each head of a 
1283 § 2374b CH. 139—RESEARCH AND DEVELOPMENT 

defense agency carrying out a program under subsection (a) shall 

submit to the Committees on Armed Services of the Senate and the 

House of Representatives a report on the administration of that 

program for that fiscal year. 

(f) PERIOD OF AUTHORITY.—The authority to award prizes 

under subsection (a) shall terminate at the end of September 30, 

2006. 

(Added Pub. L. 107–314, div. A, title II, Sec. 248(c)(1), Dec. 2, 2002, 116 Stat. 2502.) 
1284 

CHAPTER 140—PROCUREMENT OF COMMERCIAL ITEMS 

Sec. 

2375. Relationship of commercial item provisions to other provisions of law. 

2376. Definitions. 

2377. Preference for acquisition of commercial items. 

2378. Procurement of copier paper containing specified percentages of post-consumer recycled content. 

2379. Requirement for determination by Secretary of Defense and notification to 

Congress before procurement of major weapon systems as commercial 

items. 

§ 2375. Relationship of commercial item provisions to other 

provisions of law 

(a) APPLICABILITY OF TITLE.—Unless otherwise specifically provided, nothing in this chapter shall be construed as providing that 

any other provision of this title relating to procurement is inapplicable to the procurement of commercial items. 

(b) LIST OF LAWS INAPPLICABLE TO CONTRACTS FOR THE ACQUISITION OF COMMERCIAL ITEMS.—No contract for the procurement of 

a commercial item entered into by the head of an agency shall be 

subject to any law properly listed in the Federal Acquisition Regulation (pursuant to section 1906 of title 41). 

(c) CROSS REFERENCE TO EXCEPTION TO COST OR PRICING DATA

REQUIREMENTS FOR COMMERCIAL ITEMS.—For a provision relating 

to an exception for requirements for cost or pricing data for contracts for the procurement of commercial items, see section 

2306a(b) of this title. 

(Added Pub. L. 103–355, title VIII, Sec. 8102, Oct. 13, 1994, 108 Stat. 3390; amended Pub. L. 

105–85, title X, Sec. 1073(a)(51), Nov. 18, 1997, 111 Stat. 1903; Pub. L. 107–107, div. A, title 

X, Sec. 1048(a)(18), Dec. 28, 2001, 115 Stat. 1223; Pub. L. 111–350, Sec. 5(b)(21), Jan. 4, 2011, 

124 Stat. 3844.) 

§ 2376. Definitions 

In this chapter: 

(1) The terms ‘‘commercial item’’, ‘‘nondevelopmental 

item’’, ‘‘component’’, and ‘‘commercial component’’ have the 

meanings provided in chapter 1 of title 41. 

(2) The term ‘‘head of an agency’’ means the Secretary of 

Defense, the Secretary of Homeland Security, and the Administrator of the National Aeronautics and Space Administration. 

(3) The term ‘‘agency’’ means the Department of Defense, 

the Coast Guard, and the National Aeronautics and Space Administration. 

(Added Pub. L. 103–355, title VIII, Sec. 8103, Oct. 13, 1994, 108 Stat. 3390; amended Pub. L. 

107–107, div. A, title X, Sec. 1048(a)(19), Dec. 28, 2001, 115 Stat. 1223; Pub. L. 107–296, title 

XVII, Sec. 1704(b)(1), Nov. 25, 2002, 116 Stat. 2314; Pub. L. 111–350, Sec. 5(b)(22), Jan. 4, 2011, 

124 Stat. 3844.) 
1285 § 2377 CH. 140—PROCUREMENT OF COMMERCIAL ITEMS 

§ 2377. Preference for acquisition of commercial items 

(a) PREFERENCE.—The head of an agency shall ensure that, to 

the maximum extent practicable— 

(1) requirements of the agency with respect to a procurement of supplies or services are stated in terms of— 

(A) functions to be performed; 

(B) performance required; or 

(C) essential physical characteristics; 

(2) such requirements are defined so that commercial 

items or, to the extent that commercial items suitable to meet 

the agency’s needs are not available, nondevelopmental items 

other than commercial items, may be procured to fulfill such 

requirements; and 

(3) offerors of commercial items and nondevelopmental 

items other than commercial items are provided an opportunity 

to compete in any procurement to fill such requirements. 

(b) IMPLEMENTATION.—The head of an agency shall ensure that 

procurement officials in that agency, to the maximum extent practicable— 

(1) acquire commercial items or nondevelopmental items 

other than commercial items to meet the needs of the agency; 

(2) require prime contractors and subcontractors at all levels under the agency contracts to incorporate commercial items 

or nondevelopmental items other than commercial items as 

components of items supplied to the agency; 

(3) modify requirements in appropriate cases to ensure 

that the requirements can be met by commercial items or, to 

the extent that commercial items suitable to meet the agency’s 

needs are not available, nondevelopmental items other than 

commercial items; 

(4) state specifications in terms that enable and encourage 

bidders and offerors to supply commercial items or, to the extent that commercial items suitable to meet the agency’s needs 

are not available, nondevelopmental items other than commercial items in response to the agency solicitations; 

(5) revise the agency’s procurement policies, practices, and 

procedures not required by law to reduce any impediments in 

those policies, practices, and procedures to the acquisition of 

commercial items; and 

(6) require training of appropriate personnel in the acquisition of commercial items. 

(c) PRELIMINARY MARKET RESEARCH.—(1) The head of an agency shall conduct market research appropriate to the circumstances— 

(A) before developing new specifications for a procurement 

by that agency; 

(B) before soliciting bids or proposals for a contract in excess of the simplified acquisition threshold; and 

(C) before awarding a task order or delivery order in excess of the simplified acquisition threshold. 

(2) The head of an agency shall use the results of market research to determine whether there are commercial items or, to the 

extent that commercial items suitable to meet the agency’s needs 
§ 2378 CH. 140—PROCUREMENT OF COMMERCIAL ITEMS 1286 

are not available, nondevelopmental items other than commercial 

items available that— 

(A) meet the agency’s requirements; 

(B) could be modified to meet the agency’s requirements; 

or 

(C) could meet the agency’s requirements if those requirements were modified to a reasonable extent. 

(3) In conducting market research, the head of an agency 

should not require potential sources to submit more than the minimum information that is necessary to make the determinations required in paragraph (2). 

(4) The head of an agency shall take appropriate steps to ensure that any prime contractor of a contract (or task order or delivery order) in an amount in excess of $5,000,000 for the procurement of items other than commercial items engages in such market 

research as may be necessary to carry out the requirements of subsection (b)(2) before making purchases for or on behalf of the Department of Defense. 

(Added Pub. L. 103–355, title VIII, Sec. 8104(a), Oct. 13, 1994, 108 Stat. 3390; amended Pub. 

L. 110–181, div. A, title VIII, Sec. 826(a), Jan. 28, 2008, 122 Stat. 227.) 

§ 2378. Procurement of copier paper containing specified 

percentages of post-consumer recycled content 

(a) PROCUREMENT REQUIREMENT.—(1) Except as provided in 

subsections (b) and (c), a department or agency of the Department 

of Defense may not procure copying machine paper after the applicable date specified in paragraph (2) unless the percentage of postconsumer recycled content of the paper meets the percentage then 

in effect under such paragraph. 

(2) The percentage of post-consumer recycled content of paper 

required under paragraph (1) is as follows: 

(A) 20 percent as of January 1, 1998. 

(B) 30 percent as of January 1, 1999. 

(C) 50 percent as of January 1, 2004. 

(b) EXCEPTIONS.—A department or agency of the Department 

of Defense is not required to procure copying machine paper containing a percentage of post-consumer recycled content that meets 

the applicable requirement in subsection (a) if the Secretary concerned determines that one or more of the following circumstances 

apply with respect to that procurement: 

(1) The cost of procuring copying machine paper satisfying 

the applicable requirement significantly exceeds the cost of 

procuring copying machine paper containing a percentage of 

post-consumer recycled content that does not meet such requirement. The Secretary concerned shall establish the cost 

differential to be applied under this paragraph. 

(2) Copying machine paper containing a percentage of 

post-consumer recycled content meeting such requirement is 

not reasonably available within a reasonable period of time. 

(3) Copying machine paper containing a percentage of 

post-consumer recycled content meeting such requirement does 

not meet performance standards of the department or agency 

for copying machine paper. 
1287 § 2379 CH. 140—PROCUREMENT OF COMMERCIAL ITEMS 

1 In subsection (a)(1)(A), ‘‘section 4(12) of the Office of Federal Procurement Policy Act (41 

U.S.C. 403(12))’’ should be ‘‘section 103 of title 41’’. 2 In subsection (b), ‘‘section 35(c) of the Office of Federal Procurement Policy Act (41 U.S.C. 

431(c))’’ should be ‘‘section 104 of title 41’’. 

(c) EFFECT OF INABILITY TO MEET GOAL IN 2004.—(1) In the 

case of the requirement that will take effect on January 1, 2004, 

pursuant to subsection (a)(2)(C), the requirement shall not take effect with respect to a military department or Defense Agency if the 

Secretary of Defense determines that the department or agency 

will be unable to meet such requirement by that date. 

(2) The Secretary shall submit to Congress written notice of 

any determination made under paragraph (1) and the reasons for 

the determination. The Secretary shall submit such notice, if at all, 

not later than January 1, 2003. 

(d) SECRETARY CONCERNED DEFINED.—In this section, the term 

‘‘Secretary concerned’’ means the Secretary of each military department and the Secretary of Defense with respect to the Defense 

Agencies. 

(Added Pub. L. 105–85, div. A, title III, Sec. 350(a), Nov. 18, 1997, 111 Stat. 1691.) 

§ 2379. Requirement for determination by Secretary of Defense and notification to Congress before procurement of major weapon systems as commercial 

items 

(a) REQUIREMENT FOR DETERMINATION AND NOTIFICATION.—A 

major weapon system of the Department of Defense may be treated 

as a commercial item, or purchased under procedures established 

for the procurement of commercial items, only if— 

(1) the Secretary of Defense determines that— 

(A) the major weapon system is a commercial item, as 

defined in section 4(12) of the Office of Federal Procurement Policy Act (41 U.S.C. 403(12)) 1; and 

(B) such treatment is necessary to meet national security objectives; 

(2) the offeror has submitted sufficient information to 

evaluate, through price analysis, the reasonableness of the 

price for such system; and 

(3) the congressional defense committees are notified at 

least 30 days before such treatment or purchase occurs. 

(b) TREATMENT OF SUBSYSTEMS AS COMMERCIAL ITEMS.—A subsystem of a major weapon system (other than a commercially available off-the-shelf item as defined in section 35(c) of the Office of 

Federal Procurement Policy Act (41 U.S.C. 431(c))) 2 shall be treated as a commercial item and purchased under procedures established for the procurement of commercial items only if— 

(1) the subsystem is intended for a major weapon system 

that is being purchased, or has been purchased, under procedures established for the procurement of commercial items in 

accordance with the requirements of subsection (a); or 

(2) the contracting officer determines in writing that— 
§ 2379 CH. 140—PROCUREMENT OF COMMERCIAL ITEMS 1288 

3 In subsection (b)(2)(A), ‘‘section 4(12) of the Office of Federal Procurement Policy Act (41 

U.S.C. 403(12))’’ should be ‘‘section 103 of title 41’’. 4 In subsection (c)(1), ‘‘section 35(c) of the Office of Federal Procurement Policy Act (41 U.S.C. 

431(c))’’ should be ‘‘section 104 of title 41’’. 5 In subsection (c)(1)(B)(i), ‘‘section 4(12) of the Office of Federal Procurement Policy Act (41 

U.S.C. 403(12))’’ should be ‘‘section 103 of title 41’’. 

(A) the subsystem is a commercial item, as defined in 

section 4(12) of the Office of Federal Procurement Policy 

Act (41 U.S.C. 403(12)) 3; and 

(B) the offeror has submitted sufficient information to 

evaluate, through price analysis, the reasonableness of the 

price for such subsystem. 

(c) TREATMENT OF COMPONENTS AND SPARE PARTS AS COMMERCIAL ITEMS.—(1) A component or spare part for a major weapon 

system (other than a commercially available off-the-shelf item as 

defined in section 35(c) of the Office of Federal Procurement Policy 

Act (41 U.S.C. 431(c))) 4 may be treated as a commercial item for 

the purposes of section 2306a of this title only if— 

(A) the component or spare part is intended for— 

(i) a major weapon system that is being purchased, or 

has been purchased, under procedures established for the 

procurement of commercial items in accordance with the 

requirements of subsection (a); or 

(ii) a subsystem of a major weapon system that is 

being purchased, or has been purchased, under procedures 

established for the procurement of commercial items in accordance with the requirements of subsection (b); or 

(B) the contracting officer determines in writing that— 

(i) the component or spare part is a commercial item, 

as defined in section 4(12) of the Office of Federal Procurement Policy Act (41 U.S.C. 403(12)) 5; and 

(ii) the offeror has submitted sufficient information to 

evaluate, through price analysis, the reasonableness of the 

price for such component or spare part. 

(2) This subsection shall apply only to components and spare 

parts that are acquired by the Department of Defense through a 

prime contract or a modification to a prime contract (or through a 

subcontract under a prime contract or modification to a prime contract on which the prime contractor adds no, or negligible, value). 

(d) INFORMATION SUBMITTED.—To the extent necessary to 

make a determination under subsection (a)(2), (b)(2), or (c)(1)(B), 

the contracting officer may request the offeror to submit— 

(1) prices paid for the same or similar commercial items 

under comparable terms and conditions by both government 

and commercial customers; and 

(2) if the contracting officer determines that the information described in paragraph (1) is not sufficient to determine 

the reasonableness of price, other relevant information regarding the basis for price or cost, including information on labor 

costs, material costs, and overhead rates. 

(e) DELEGATION.—The authority of the Secretary of Defense to 

make a determination under subsection (a) may be delegated only 

to the Deputy Secretary of Defense, without further redelegation. 
1289 § 2379 CH. 140—PROCUREMENT OF COMMERCIAL ITEMS 

(f) MAJOR WEAPON SYSTEM DEFINED.—In this section, the term 

‘‘major weapon system’’ means a weapon system acquired pursuant 

to a major defense acquisition program (as that term is defined in 

section 2430 of this title). 

(Added Pub. L. 109–163, div. A, title VIII, Sec. 803(a)(1), Jan. 6, 2006, 119 Stat. 3370; amended 

Pub. L. 110–181, div. A, title VIII, Sec. 815(a)(1), Jan. 28, 2008, 122 Stat. 222.) 
1290 

CHAPTER 141—MISCELLANEOUS PROCUREMENT 

PROVISIONS 

Sec. 

2381. Contracts: regulations for bids. 

2382. Consolidation of contract requirements: policy and restrictions. 

2383. Contractor performance of acquisition functions closely associated with inherently governmental functions. 

2384. Supplies: identification of supplier and sources. 

2384a. Supplies: economic order quantities. 

2385. Arms and ammunition: immunity from taxation. 

2386. Copyrights, patents, designs, etc.; acquisition. 

2387. Procurement of table and kitchen equipment for officers’ quarters: limitation on. 

[2388. Renumbered.] 

2389. Ensuring safety regarding insensitive munitions. 

2390. Prohibition on the sale of certain defense articles from the stocks of the 

Department of Defense. 

2391. Military base reuse studies and community planning assistance. 

2392. Prohibition on use of funds to relieve economic dislocations. 

2393. Prohibition against doing business with certain offerors or contractors. 

[2394. Renumbered.] 

[2394a. Renumbered.] 

2395. Availability of appropriations for procurement of technical military equipment and supplies. 

2396. Advances for payments for compliance with foreign laws, rent in foreign 

countries, tuition, public utility services, and pay and supplies of armed 

forces of friendly foreign countries. 

[2397 to 2398a. Repealed or Renumbered.] 

2399. Operational test and evaluation of defense acquisition programs. 

2400. Low-rate initial production of new systems. 

2401. Requirement for authorization by law of certain contracts relating to vessels, aircraft, and combat vehicles. 

2401a. Lease of vehicles, equipment, vessels, and aircraft. 

2402. Prohibition of contractors limiting subcontractor sales directly to the 

United States. 

[2403 to 2407. Repealed or Renumbered.] 

2408. Prohibition on persons convicted of defense-contract related felonies and 

related criminal penalty on defense contractors. 

2409. Contractor employees: protection from reprisal for disclosure of certain information. 

[2409a. Repealed.] 

2410. Requests for equitable adjustment or other relief: certification. 

2410a. Contracts for periods crossing fiscal years: severable service contracts; 

leases of real or personal property. 

2410b. Contractor inventory accounting systems: standards. 

[2410c. Renumbered.] 

2410d. Subcontracting plans: credit for certain purchases. 

[2410e. Repealed.] 

2410f. Debarment of persons convicted of fraudulent use of ‘‘Made in America’’ 

labels. 

2410g. Advance notification of contract performance outside the United States. 

[2410h. Renumbered.] 

2410i. Prohibition on contracting with entities that comply with the secondary 

Arab boycott of Israel. 

2410j. Displaced contractor employees: assistance to obtain certification and employment as teachers or employment as teachers’ aides. 

2410k. Defense contractors: listing of suitable employment openings with local 

employment service office. 
1291 § 2382 CH. 141—MISC. PROCUREMENT PROVISIONS 

1 In section 2382(b)(1), ‘‘of the Small Business Act (15 U.S.C. 657q(c)(4))’’ should probably appear after ‘‘section 44(c)(4)’’. 

2410l. Contracts for advisory and assistance services: cost comparison studies. 

2410m. Retention of amounts collected from contractor during the pendency of 

contract dispute. 

2410n. Products of Federal Prison Industries: procedural requirements. 

2410o. Multiyear procurement authority: purchase of dinitrogen tetroxide, hydrazine, and hydrazine-related products. 

2410p. Contracts: limitations on lead system integrators. 

2410q. Multiyear contracts: purchase of electricity from renewable energy 

sources. 

§ 2381. Contracts: regulations for bids 

(a) The Secretary of Defense may— 

(1) prescribe regulations for the preparation, submission, 

and opening of bids for contracts; and 

(2) require that a bid be accompanied by a written guaranty, signed by one or more responsible persons, undertaking 

that the bidder, if his bid is accepted, will, within the time prescribed by the Secretary or other officer authorized to make the 

contract, make a contract and furnish a bond with good and 

sufficient sureties for the performance of the contract. 

(b) If a bidder, after being notified of the acceptance of his bid, 

fails within the time prescribed under subsection (a)(2) to enter 

into a contract and furnish the prescribed bond, the Secretary concerned or other authorized officer shall— 

(1) contract with another person; and 

(2) charge against the defaulting bidder and his guarantors the difference between the amount specified by the bidder 

in his bid and the amount for which a contract is made with 

the other person, this difference being immediately recoverable 

by the United States for the use of the military department 

concerned in an action against the bidder and his guarantors, 

jointly or severally. 

(c) Proceedings under this section are subject to regulations 

under section 121 of title 40, unless exempted therefrom under section 501(a)(2) of title 40. 

(Aug. 10, 1956, ch. 1041, 70A Stat. 136; Oct. 19, 1984, Pub. L. 98–525, title XIV, Sec. 1405(35), 

98 Stat. 2624; Oct. 13, 1994, Pub. L. 103–355, title I, Sec. 1507, 108 Stat. 3298; Pub. L. 107– 

217, Sec. 3(b)(6), Aug. 21, 2002, 116 Stat. 1295.) 

§ 2382. Consolidation of contract requirements: policy and 

restrictions 

(a) POLICY.—The Secretary of Defense shall require the Secretary of each military department, the head of each Defense Agency, and the head of each Department of Defense Field Activity to 

ensure that the decisions made by that official regarding consolidation of contract requirements of the department, agency, or field activity, as the case may be, are made with a view to providing small 

business concerns with appropriate opportunities to participate in 

Department of Defense procurements as prime contractors and appropriate opportunities to participate in such procurements as subcontractors. 

(b) LIMITATION ON USE OF ACQUISITION STRATEGIES INVOLVING

CONSOLIDATION.—(1) Subject to section 44(c)(4) 1, an official of a 

military department, Defense Agency, or Department of Defense 
§ 2382 CH. 141—MISC. PROCUREMENT PROVISIONS 1292 

2 In subsection (c)(2)(B), ‘‘sections 303H through 303K of the Federal Property and Administrative Services Act of 1949 (41 U.S.C. 253h through 253k)’’ should be ‘‘sections 4101, 4103, 

4105, and 4106 of title 41’’. 

Field Activity may not execute an acquisition strategy that includes 

a consolidation of contract requirements of the military department, agency, or activity with a total value in excess of $5,000,000, 

unless the senior procurement executive concerned first— 

(A) conducts market research; 

(B) identifies any alternative contracting approaches that 

would involve a lesser degree of consolidation of contract requirements; and 

(C) determines that the consolidation is necessary and justified. 

(2) A senior procurement executive may determine that an acquisition strategy involving a consolidation of contract requirements is necessary and justified for the purposes of paragraph (1) 

if the benefits of the acquisition strategy substantially exceed the 

benefits of each of the possible alternative contracting approaches 

identified under subparagraph (B) of that paragraph. However, 

savings in administrative or personnel costs alone do not constitute, for such purposes, a sufficient justification for a consolidation of contract requirements in a procurement unless the total 

amount of the cost savings is expected to be substantial in relation 

to the total cost of the procurement. 

(3) Benefits considered for the purposes of paragraphs (1) and 

(2) may include cost and, regardless of whether quantifiable in dollar amounts— 

(A) quality; 

(B) acquisition cycle; 

(C) terms and conditions; and 

(D) any other benefit. 

(c) DEFINITIONS.—In this section: 

(1) The terms ‘‘consolidation of contract requirements’’ and 

‘‘consolidation’’, with respect to contract requirements of a military department, Defense Agency, or Department of Defense 

Field Activity, mean a use of a solicitation to obtain offers for 

a single contract or a multiple award contract to satisfy two or 

more requirements of that department, agency, or activity for 

goods or services that have previously been provided to, or performed for, that department, agency, or activity under two or 

more separate contracts smaller in cost than the total cost of 

the contract for which the offers are solicited. 

(2) The term ‘‘multiple award contract’’ means— 

(A) a contract that is entered into by the Administrator of General Services under the multiple award schedule program referred to in section 2302(2)(C) of this title; 

(B) a multiple award task order contract or delivery 

order contract that is entered into under the authority of 

sections 2304a through 2304d of this title or sections 303H 

through 303K of the Federal Property and Administrative 

Services Act of 1949 (41 U.S.C. 253h through 253k) 2; and 

(C) any other indeterminate delivery, indeterminate 

quantity contract that is entered into by the head of a Fed-
1293 § 2383 CH. 141—MISC. PROCUREMENT PROVISIONS 

3 In section 2382(c)(3)(A), ‘‘section 16(c) of the Office of Federal Procurement Policy Act (41 

U.S.C. 414(c))’’ should be ‘‘section 1702(c) of title 41’’. 

eral agency with two or more sources pursuant to the 

same solicitation. 

(3) The term ‘‘senior procurement executive concerned’’ 

means— 

(A) with respect to a military department, the official 

designated under section 16(c) of the Office of Federal Procurement Policy Act (41 U.S.C. 414(c)) 3. 

(B) with respect to a Defense Agency or a Department 

of Defense Field Activity, the official so designated for the 

Department of Defense. 

(4) The term ‘‘small business concern’’ means a business 

concern that is determined by the Administrator of the Small 

Business Administration to be a small-business concern by application of the standards prescribed under section 3(a) of the 

Small Business Act (15 U.S.C. 632(a)). 

(Added Pub. L. 108–136, div. A, title VIII, Sec. 801(a)(1), Nov. 24, 2003, 117 Stat. 1538; amended Pub. L. 109–364, div. A, title X, Sec. 1071(a)(2), Oct. 17, 2006, 120 Stat. 2398; Pub. L. 111– 

240, title I, Sec. 1313(b), Sept. 27, 2010, 124 Stat. 2539.) 

§ 2383. Contractor performance of acquisition functions 

closely associated with inherently governmental 

functions 

(a) LIMITATION.—The head of an agency may enter into a contract for the performance of acquisition functions closely associated 

with inherently governmental functions only if the contracting officer for the contract ensures that— 

(1) appropriate military or civilian personnel of the Department of Defense cannot reasonably be made available to 

perform the functions; 

(2) appropriate military or civilian personnel of the Department of Defense are— 

(A) to supervise contractor performance of the contract; and 

(B) to perform all inherently governmental functions 

associated with the functions to be performed under the 

contract; and 

(3) the agency addresses any potential organizational conflict of interest of the contractor in the performance of the 

functions under the contract, consistent with subpart 9.5 of 

part 9 of the Federal Acquisition Regulation and the best interests of the Department of Defense. 

(b) DEFINITIONS.—In this section: 

(1) The term ‘‘head of an agency’’ has the meaning given 

such term in section 2302(1) of this title, except that such term 

does not include the Secretary of Homeland Security or the Administrator of the National Oceanic and Atmospheric Administration. 

(2) The term ‘‘inherently governmental functions’’ has the 

meaning given such term in subpart 7.5 of part 7 of the Federal Acquisition Regulation. 
§ 2384 CH. 141—MISC. PROCUREMENT PROVISIONS 1294 

(3) The term ‘‘functions closely associated with inherently 

governmental functions’’ means the functions described in section 7.503(d) of the Federal Acquisition Regulation. 

(4) The term ‘‘organizational conflict of interest’’ has the 

meaning given such term in subpart 9.5 of part 9 of the Federal Acquisition Regulation. 

(Added Pub. L. 108–375, div. A, title VIII, Sec. 804(a)(1), Oct. 28, 2004, 118 Stat. 2007.) 

§ 2384. Supplies: identification of supplier and sources 

(a) The Secretary of Defense shall require that the contractor 

under a contract with the Department of Defense for the furnishing 

of supplies to the United States shall mark or otherwise identify 

supplies furnished under the contract with the identity of the contractor, the national stock number for the supplies furnished (if 

there is such a number), and the contractor’s identification number 

for the supplies. 

(b)(1) The Secretary of Defense shall prescribe regulations requiring that, whenever practicable, each contract requiring the delivery of supplies (other than a contract described in paragraph (2)) 

shall require that the contractor identify— 

(A) the actual manufacturer or producer of the item or of 

all sources of supply of the contractor for that item; 

(B) the national stock number of the item (if there is such 

a number) and the identification number of the actual manufacturer or producer of the item or of each source of supply of 

the contractor for the item; and 

(C) the source of any technical data delivered under the 

contract. 

(2) The regulations prescribed pursuant to paragraph (1) do 

not apply to a contract that requires the delivery of supplies that 

are commercial items (as defined in section 103 of title 41). 

(3) The regulations prescribed pursuant to paragraph (1) do 

not apply to a contract for an amount not greater than the simplified acquisition threshold (as defined in section 134 of title 41). 

(c) Identification of supplies and technical data under this section shall be made in the manner and with respect to the supplies 

prescribed by the Secretary of Defense. 

(Aug. 10, 1956, ch. 1041, 70A Stat. 137; Pub. L. 98–525, title XII, Sec. 1231(a), Oct. 19, 1984, 

98 Stat. 2599; Pub. L. 99–500, Sec. 101(c) [title X, Sec. 928(a)], Oct. 18, 1986, 100 Stat. 1783– 

82, 1783–156, and Pub. L. 99–591, Sec. 101(c) [title X, Sec. 928(a)], Oct. 30, 1986, 100 Stat. 

3341–82, 3341–156; Pub. L. 99–661, div. A, title IX, formerly title IV, Sec. 928(a), Nov. 14, 1986, 

100 Stat. 3936, renumbered title IX, Pub. L. 100–26, Sec. 3(5), Apr. 21, 1987, 101 Stat. 273; 

Pub. L. 103–355, title IV, Sec. 4102(d), title VIII, Sec. 8105(b), Oct. 13, 1994, 108 Stat. 3340, 

3392; Pub. L. 104–106, div. D, title XLIII, Sec. 4321(b)(12), Feb. 10, 1996, 110 Stat. 672; Pub. 

L. 111–350, Sec. 5(b)(23), Jan. 4, 2011, 124 Stat. 3844.) 

§ 2384a. Supplies: economic order quantities 

(a)(1) An agency referred to in section 2303(a) of this title shall 

procure supplies in such quantity as (A) will result in the total cost 

and unit cost most advantageous to the United States, where practicable, and (B) does not exceed the quantity reasonably expected 

to be required by the agency. 

(2) The Secretary of Defense shall take paragraph (1) into account in approving rates of obligation of appropriations under section 2204 of this title. 
1295 § 2387 CH. 141—MISC. PROCUREMENT PROVISIONS 

(b) Each solicitation for a contract for supplies shall, if practicable, include a provision inviting each offeror responding to the 

solicitation to state an opinion on whether the quantity of the supplies proposed to be procured is economically advantageous to the 

United States and, if applicable, to recommend a quantity or quantities which would be more economically advantageous to the 

United States. Each such recommendation shall include a 

quotation of the total price and the unit price for supplies procured 

in each recommended quantity. 

(Added Pub. L. 98–525, title XII, Sec. 1233(a), Oct. 19, 1984, 98 Stat. 2600.) 

§ 2385. Arms and ammunition: immunity from taxation 

No tax on the sale or transfer of firearms, pistols, revolvers, 

shells, or cartridges may be imposed on such articles when bought 

with funds appropriated for a military department. 

(Aug. 10, 1956, ch. 1041, 70A Stat. 137.) 

§ 2386. Copyrights, patents, designs, etc.; acquisition 

Funds appropriated for a military department available for 

making or procuring supplies may be used to acquire any of the following if the acquisition relates to supplies or processes produced 

or used by or for, or useful to, that department: 

(1) Copyrights, patents, and applications for patents. 

(2) Licenses under copyrights, patents, and applications for 

patents. 

(3) Design and process data, technical data, and computer 

software. 

(4) Releases for past infringement of patents or copyrights 

or for unauthorized use of technical data or computer software. 

(Aug. 10, 1956, ch. 1041, 70A Stat. 137; Pub. L. 86–726, Sec. 3, Sept. 8, 1960, 74 Stat. 855; 

Pub. L. 103–355, title III, Sec. 3063, Oct. 13, 1994, 108 Stat. 3337; Pub. L. 104–106, div. A, 

title VIII, Sec. 813, Feb. 10, 1996, 110 Stat. 395.) 

§ 2387. Procurement of table and kitchen equipment for officers’ quarters: limitation on 

(a) Except under regulations approved by the Secretary of Defense and providing for uniform practices among the armed forces 

under his jurisdiction, no part of any appropriation of the Department of Defense may be used to supply or replace table linen, 

dishes, glassware, silver, and kitchen utensils for use in the residences on shore, or quarters on shore, of officers of those armed 

forces. 

(b) This section does not apply to— 

(1) field messes; 

(2) messes temporarily set up on shore for bachelor officers 

and officers attached to seagoing or district defense vessels; 

(3) aviation units based on seagoing vessels; 

(4) fleet air bases; 

(5) submarine bases; and 

(6) landing forces and expeditions. 

(Added Pub. L. 85–861, Sec. 1(45), Sept. 2, 1958, 72 Stat. 1458.) 
[§ 2388 CH. 141—MISC. PROCUREMENT PROVISIONS 1296 

[§ 2388. Renumbered 2922] 

§ 2389. Ensuring safety regarding insensitive munitions 

The Secretary of Defense shall ensure, to the extent practicable, that insensitive munitions under development or procurement are safe throughout development and fielding when subject to 

unplanned stimuli. 

(Added Pub. L. 107–107, div. A, title VIII, Sec. 834(a)(1), Dec. 28, 2001, 115 Stat. 1191.) 

§ 2390. Prohibition on the sale of certain defense articles 

from the stocks of the Department of Defense 

(a)(1) Except as provided in subsections (b) and (c), the sale 

outside the Department of Defense of any defense article designated or otherwise classified as Prepositioned Material Configured to Unit Sets, as decrement stock, or as Prepositioned War Reserve Stocks for United States Forces is prohibited. 

(2) In this section, the term ‘‘decrement stock’’ means such 

stock as is needed to bring the armed forces from a peacetime level 

of readiness to a combat level of readiness. 

(b) The President may authorize the sale outside the Department of Defense of a defense article described in subsection (a) if— 

(1) he determines that there is an international crisis affecting the national security of the United States and the sale 

of such article is in the best interests of the United States; and 

(2) he reports to the Congress not later than 60 days after 

the transfer of such article a plan for the prompt replenishment of the stocks of such article and the planned budget request to begin implementation of that plan. 

(c)(1) Nothing in this section shall preclude the sale of stocks 

which have been designated for replacement, substitution, or elimination or which have been designated for sale to provide funds to 

procure higher priority stocks. 

(2) Nothing in this section shall preclude the transfer or sale 

of equipment to other members of the North Atlantic Treaty Organization. 

(Added Pub. L. 95–485, title VIII, Sec. 815(a), Oct. 20, 1978, 92 Stat. 1625, Sec. 975; amended 

Pub. L. 100–26, Sec. 7(k)(3), Apr. 21, 1987, 101 Stat. 284; renumbered Sec. 2390, Pub. L. 101– 

189, div. A, title XVI, Sec. 1622(b)(1), Nov. 29, 1989, 103 Stat. 1604.) 

§ 2391. Military base reuse studies and community planning 

assistance 

(a) REUSE STUDIES.—Whenever the Secretary of Defense or the 

Secretary of the military department concerned publicly announces 

that a military installation is a candidate for closure or that a final 

decision has been made to close a military installation and the Secretary of Defense determines, because of the location, facilities, or 

other particular characteristics of the installation, that the installation may be suitable for some specific Federal, State, or local use 

potentially beneficial to the Nation, the Secretary of Defense may 

conduct such studies, including the preparation of an environmental impact statement in accordance with the National Environmental Policy Act of 1969 (42 U.S.C. 4321 et seq.), in connection 

with such installation and such potential use as may be necessary 
1297 § 2391 CH. 141—MISC. PROCUREMENT PROVISIONS 

to provide information sufficient to make sound conclusions and 

recommendations regarding the possible use of the installation. 

(b) ADJUSTMENT AND DIVERSIFICATION ASSISTANCE.—(1) The 

Secretary of Defense may make grants, conclude cooperative agreements, and supplement funds available under Federal programs 

administered by agencies other than the Department of Defense in 

order to assist State and local governments in planning community 

adjustments and economic diversification required (A) by the proposed or actual establishment, realignment, or closure of a military 

installation, (B) by the cancellation or termination of a Department 

of Defense contract or the failure to proceed with an approved 

major weapon system program, (C) by a publicly announced 

planned major reduction in Department of Defense spending that 

would directly and adversely affect a community, (D) by the encroachment of a civilian community on a military installation, or 

(E) by the closure or the significantly reduced operations of a defense facility as the result of the merger, acquisition, or consolidation of the defense contractor operating the defense facility, if the 

Secretary determines that an action described in clause (A), (B), 

(C), or (E) is likely to have a direct and significantly adverse consequence on the affected community or, in the case of an action described in clause (D), if the Secretary determines that the encroachment of the civilian community is likely to impair the continued 

operational utility of the military installation. 

(2) In the case of the establishment or expansion of a military 

installation, assistance may be made under paragraph (1) only if 

(A) community impact assistance or special impact assistance is not 

otherwise available, and (B) the establishment or expansion involves the assignment to the installation of (i) more than 2,000 

military, civilian, and contractor Department of Defense personnel, 

or (ii) more military, civilian, and contractor Department of Defense personnel than the number equal to 10 percent of the number 

of persons employed in counties or independent municipalities 

within fifteen miles of the installation, whichever is lesser. 

(3) In the case of a publicly announced planned reduction in 

Department of Defense spending, the closure or realignment of a 

military installation, the cancellation or termination of a Department of Defense contract, or the failure to proceed with a previously approved major defense acquisition program, assistance 

may be made under paragraph (1) only if the reduction, closure or 

realignment, cancellation or termination, or failure will have a direct and significant adverse impact on a community or its residents. 

(4)(A) In the case of a State or local government eligible for assistance under paragraph (1), the Secretary of Defense may also 

make grants, conclude cooperative agreements, and supplement 

other Federal funds in order to assist the State or local government 

to carry out a community adjustment and economic diversification 

program (including State industrial extension or modernization efforts to facilitate the economic diversification of defense contractors 

and subcontractors) in addition to planning such a program. 

(B) The Secretary shall establish criteria for the selection of 

community adjustment and economic diversification programs to 
§ 2391 CH. 141—MISC. PROCUREMENT PROVISIONS 1298 

receive assistance under subparagraph (A). Such criteria shall include a requirement that the State or local government agree— 

(i) to provide not less than 10 percent of the funding for 

the program from non-Federal sources; 

(ii) to provide business planning and market exploration 

services under the program to defense contractors and subcontractors that seek modernization or diversification assistance; and 

(iii) to provide training, counseling, and placement services 

for members of the armed forces and dislocated defense workers. 

(C) The Secretary shall carry out this paragraph in coordination with the Secretary of Commerce. 

(5)(A) The Secretary of Defense may also make grants, conclude cooperative agreements, and supplement other Federal funds 

in order to assist a State or local government in planning community adjustments and economic diversification even though the 

State or local government is not currently eligible for assistance 

under paragraph (1) if the Secretary determines that a substantial 

portion of the economic activity or population of the geographic 

area to be subject to the advance planning is dependent on defense 

expenditures. 

(B) The Secretary of Defense may also make grants, conclude 

cooperative agreements, and supplement other Federal funds in 

order to assist a State in enhancing its capacities— 

(i) to assist communities, businesses, and workers adversely affected by an action described in paragraph (1); 

(ii) to support local adjustment and diversification initiatives; and 

(iii) to stimulate cooperation between statewide and local 

adjustment and diversification efforts. 

(C) The Secretary of Defense may also make grants, conclude 

cooperative agreements, and supplement other Federal funds in 

order to assist a State or local government in enhancing the capabilities of the government to support efforts of the Department of 

Defense to privatize, contract for, or diversify the performance of 

military family support services in cases in which the capability of 

the Department to provide such services is adversely affected by an 

action described in paragraph (1). 

(6) Funds provided to State and local governments and regional organizations under this section may be used as part or all 

of any required non-Federal contribution to a Federal grant-in-aid 

program for the purposes stated in paragraph (1). 

(7) To the extent practicable, the Secretary of Defense shall inform a State or local government applying for assistance under this 

subsection of the approval or rejection by the Secretary of the application for such assistance as follows: 

(A) Before the end of the 7-day period beginning on the 

date on which the Secretary receives the application, in the 

case of an application for a planning grant. 

(B) Before the end of the 30-day period beginning on such 

date, in the case of an application for assistance to carry out 

a community adjustments and economic diversifications program. 
1299 § 2391 CH. 141—MISC. PROCUREMENT PROVISIONS 

(8)(A) In attempting to complete consideration of applications 

within the time period specified in paragraph (7), the Secretary of 

Defense shall give priority to those applications requesting assistance for a community described in subsection (f)(1). 

(B) If an application under paragraph (7) is rejected by the 

Secretary, the Secretary shall promptly inform the State or local 

government of the reasons for the rejection of the application. 

(c) RESEARCH AND TECHNICAL ASSISTANCE.—The Secretary of 

Defense may make grants to, or conclude cooperative agreements 

or enter into contracts with, another Federal agency, a State or 

local government, or any private entity to conduct research and 

provide technical assistance in support of activities under this section or Executive Order 12788 (57 Fed. Reg. 2213), as amended by 

section 33 of Executive Order 13286 (68 Fed. Reg. 10625) and Executive Order 13378 (70 Fed. Reg. 28413). 

(d) DEFINITIONS.—In this section: 

(1) The terms ‘‘military installation’’ and ‘‘realignment’’ 

have the meanings given those terms in section 2687(e) of this 

title. For purposes of subsection (b)(1)(D), the term ‘‘military 

installation’’ includes a military facility owned and operated by 

any of the several States, the District of Columbia, the Commonwealth of Puerto Rico, American Samoa, Guam, the Commonwealth of the Northern Mariana Islands, or the Virgin Islands, even though the facility is not under the jurisdiction of 

the Department of Defense, if the Secretary of Defense determines that the military facility is subject to significant use for 

training by the armed forces. 

(2) The term ‘‘defense facility’’ means any private facility 

producing goods or services pursuant to a defense contract. 

(3) The terms ‘‘community adjustment’’ and ‘‘economic diversification’’ include the development of feasibility studies and 

business plans for market diversification within a community 

adversely affected by an action described in clause (A), (B), (C), 

or (E) of subsection (b)(1) by adversely affected businesses and 

labor organizations located in the community. 

(e) ASSISTANCE SUBJECT TO APPROPRIATIONS.—The authority of 

the Secretary of Defense to make grants under this section in any 

fiscal year is subject to the availability of appropriations for that 

purpose. 

(Added Pub. L. 97–86, title IX, Sec. 912(a)(1), Dec. 1, 1981, 95 Stat. 1122; amended Pub. L. 98– 

115, title VIII, Sec. 808, Oct. 11, 1983, 97 Stat. 789; Pub. L. 100–26, Sec. 7(k)(3), Apr. 21, 1987, 

101 Stat. 284; Pub. L. 100–456, div. B, title XXVIII, Sec. 2805, Sept. 29, 1988, 102 Stat. 2116; 

Pub. L. 101–510, div. D, title XLI, Sec. 4102(b), Nov. 5, 1990, 104 Stat. 1851; Pub. L. 102–25, 

title VII, Sec. 701(j)(3), Apr. 6, 1991, 105 Stat. 116; Pub. L. 102–484, div. A, title X, Sec. 

1052(28), div. D, title XLIII, Sec. 4301(a)–(c), Oct. 23, 1992, 106 Stat. 2500, 2696, 2697; Pub. 

L. 103–35, title II, Sec. 202(a)(15), May 31, 1993, 107 Stat. 101; Pub. L. 103–160, div. B, title 

XXIX, Sec. 2913, Nov. 30, 1993, 107 Stat. 1925; Pub. L. 103–337, div. A, title XI, Sec. 1122(a), 

1123(a), (b), Oct. 5, 1994, 108 Stat. 2870, 2871; Pub. L. 104–106, div. A, title XV, Sec. 1502(a)(1), 

Feb. 10, 1996, 110 Stat. 502; Pub. L. 104–201, div. B, title XXVIII, Sec. 2814, Sept. 23, 1996, 

110 Stat. 2790; Pub. L. 105–85, div. B, title XXVIII, Sec. 2822, Nov. 18, 1997, 111 Stat. 1997; 

Pub. L. 106–65, div. A, title X, Sec. 1067(1), Oct. 5, 1999, 113 Stat. 774; Pub. L. 107–314, div. 

A, title X, Sec. 1041(a)(13), Dec. 2, 2002, 116 Stat. 2645; Pub. L. 109–163, div. B, title XXVIII, 

Sec. 2832, Jan. 6, 2006, 119 Stat. 3520; Pub. L. 109–364, div. B, title XXVIII, Secs. 2861, 2862, 

Oct. 17, 2006, 120 Stat. 2498; Pub. L. 110–417, div. B, title XXVIII, Sec. 2823(b), Oct. 14, 2008, 

122 Stat. 4730.) 
§ 2392 CH. 141—MISC. PROCUREMENT PROVISIONS 1300 

§ 2392. Prohibition on use of funds to relieve economic dislocations 

(a) In order to help avoid the uneconomic use of Department 

of Defense funds in the procurement of goods and services, the 

Congress finds that it is necessary to prohibit the use of such funds 

for certain purposes. 

(b) No funds appropriated to or for the use of the Department 

of Defense may be used to pay, in connection with any contract 

awarded by the Department of Defense, a price differential for the 

purpose of relieving economic dislocations. 

(Added Pub. L. 97–86, title IX, Sec. 913(a)(1), Dec. 1, 1981, 95 Stat. 1123.) 

§ 2393. Prohibition against doing business with certain 

offerors or contractors 

(a)(1) Except as provided in paragraph (2), the Secretary of a 

military department may not solicit an offer from, award a contract 

to, extend an existing contract with, or, when approval by the Secretary of the award of a subcontract is required, approve the award 

of a subcontract to, an offeror or contractor which to the Secretary’s 

knowledge has been debarred or suspended by another Federal 

agency unless— 

(A) in the case of debarment, the debarment of the offeror 

or contractor by all other agencies has been terminated or the 

period of time specified for such debarment has expired; and 

(B) in the case of a suspension, the period of time specified 

by all other agencies for the suspension of the offeror or contractor has expired. 

(2) Paragraph (1) does not apply in any case in which the Secretary concerned determines that there is a compelling reason to 

solicit an offer from, award a contract to, extend a contract with, 

or approve a subcontract with such offeror or contractor. 

(b) Whenever the Secretary concerned makes a determination 

described in subsection (a)(2), he shall, at the time of the determination, transmit a notice to the Administrator of General Services describing the determination. The Administrator of General 

Services shall maintain each such notice in a file available for public inspection. 

(c) In this section: 

(1) The term ‘‘debar’’ means to exclude, pursuant to established administrative procedures, from Government contracting 

and subcontracting for a specified period of time commensurate 

with the seriousness of the failure or offense or the inadequacy 

of performance. 

(2) The term ‘‘suspend’’ means to disqualify, pursuant to 

established administrative procedures, from Government contracting and subcontracting for a temporary period of time because a concern or individual is suspected of engaging in criminal, fraudulent, or seriously improper conduct. 

(d) The Secretary of Defense shall prescribe in regulations a requirement that each contractor under contract with the Department of Defense shall require each contractor to whom it awards 

a contract (in this section referred to as a subcontractor) to disclose 

to the contractor whether the subcontractor is or is not, as of the 
1301 § 2396 CH. 141—MISC. PROCUREMENT PROVISIONS 

time of the award of the subcontract, debarred or suspended by the 

Federal Government from Government contracting or subcontracting. The requirement shall apply to any subcontractor whose 

subcontract is in an amount greater than the simplified acquisition 

threshold (as defined in section 134 of title 41). The requirement 

shall not apply in the case of a subcontract for the acquisition of 

commercial items (as defined in section 103 of title 41). 

(Added Pub. L. 97–86, title IX, Sec. 914(a), Dec. 1, 1981, 95 Stat. 1124; amended Pub. L. 100– 

180, div. A, title XII, Sec. 1231(17), Dec. 4, 1987, 101 Stat. 1161; Pub. L. 101–510, div. A, title 

VIII, Sec. 813, Nov. 5, 1990, 104 Stat. 1596; Pub. L. 102–190, div. A, title X, Sec. 1061(a)(11), 

Dec. 5, 1991, 105 Stat. 1473; Pub. L. 103–355, title IV, Sec. 4102(e), title VIII, Sec. 8105(c), Oct. 

13, 1994, 108 Stat. 3340, 3392; Pub. L. 111–350, Sec. 5(b)(24), Jan. 4, 2011, 124 Stat. 3844.) 

[§ 2394. Renumbered 2922a] 

[§ 2394a. Renumbered 2922b] 

§ 2395. Availability of appropriations for procurement of 

technical military equipment and supplies 

Funds appropriated to the Department of Defense for the procurement of technical military equipment and supplies remain 

available until spent. 

(Added Pub. L. 97–258, Sec. 2(b)(4)(B), Sept. 13, 1982, 96 Stat. 1052, Sec. 2394; renumbered 

Sec. 2395 and amended Pub. L. 97–295, Sec. 1(28)(A), Oct. 12, 1982, 96 Stat. 1291.) 

§ 2396. Advances for payments for compliance with foreign 

laws, rent in foreign countries, tuition, public utility services, and pay and supplies of armed forces 

of friendly foreign countries 

(a) An advance under an appropriation to the Department of 

Defense may be made to pay for— 

(1) compliance with laws and ministerial regulations of a 

foreign country; 

(2) rent in a foreign country for periods of time determined 

by local custom; 

(3) tuition; and 

(4) public service utilities. 

(b)(1) Under regulations prescribed by the Secretary of Defense, or by the Secretary of Homeland Security with respect to the 

Coast Guard when it is not operating as a service of the Navy, an 

officer of an armed force of the United States accountable for public 

money may advance amounts to a disbursing official of a friendly 

foreign country or members of an armed force of a friendly foreign 

country for— 

(A) pay and allowances to members of the armed force of 

that country; and 

(B) necessary supplies and services. 

(2) An advance may be made under this subsection only if the 

President has made an agreement with the foreign country— 

(A) requiring reimbursement to the United States for 

amounts advanced; 

(B) requiring the appropriate authority of the country to 

advance amounts reciprocally to members of the armed forces 

of the United States; and 
[§ 2397 CH. 141—MISC. PROCUREMENT PROVISIONS 1302 

(C) containing any other provision the President considers 

necessary to carry out this subsection and to safeguard the interests of the United States. 

(Added Pub. L. 97–258, Sec. 2(b)(4)(B), Sept. 13, 1982, 96 Stat. 1053, Sec. 2395; renumbered 

Sec. 2396 and amended Pub. L. 97–295, Sec. 1(28)(B), Oct. 12, 1982, 96 Stat. 1291; Pub. L. 105– 

85, div. A, title X, Sec. 1014(a), (b)(1), Nov. 18, 1997, 111 Stat. 1875; Pub. L. 107–296, title XVII, 

Sec. 1704(b)(1), Nov. 25, 2002, 116 Stat. 2314.) 

[§ 2397. Repealed. Pub. L. 104–106, div. D, title XLIII, Sec. 

4304(b)(1), Feb. 10, 1996, 110 Stat. 664] 

[§ 2398. Renumbered 2922c] 

[§ 2398a. Renumbered 2922d] 

§ 2399. Operational test and evaluation of defense acquisition programs 

(a) CONDITION FOR PROCEEDING BEYOND LOW-RATE INITIAL

PRODUCTION.—(1) The Secretary of Defense shall provide that a 

covered major defense acquisition program or a covered designated 

major subprogram may not proceed beyond low-rate initial production until initial operational test and evaluation of the program or 

subprogram is completed. 

(2) In this subsection: 

(A) The term ‘‘covered major defense acquisition program’’ 

means a major defense acquisition program that involves the 

acquisition of a weapon system that is a major system within 

the meaning of that term in section 2302(5) of this title. 

(B) The term ‘‘covered designated major subprogram’’ 

means a major subprogram designated under section 

2430a(a)(1) of this title that is a major subprogram of a covered 

major defense acquisition program. 

(b) OPERATIONAL TEST AND EVALUATION.—(1) Operational testing of a major defense acquisition program may not be conducted 

until the Director of Operational Test and Evaluation of the Department of Defense approves (in writing) the adequacy of the 

plans (including the projected level of funding) for operational test 

and evaluation to be conducted in connection with that program. 

(2) The Director shall analyze the results of the operational 

test and evaluation conducted for each major defense acquisition 

program. At the conclusion of such testing, the Director shall prepare a report stating— 

(A) the opinion of the Director as to— 

(i) whether the test and evaluation performed were 

adequate; and 

(ii) whether the results of such test and evaluation 

confirm that the items or components actually tested are 

effective and suitable for combat; and 

(B) additional information on the operational capabilities 

of the items or components that the Director considers appropriate based on the testing conducted. 

(3) The Director shall submit each report under paragraph (2) 

to the Secretary of Defense, the Under Secretary of Defense for Acquisition, Technology, and Logistics, and the congressional defense 

committees. Each such report shall be submitted to those committees in precisely the same form and with precisely the same con-
1303 § 2399 CH. 141—MISC. PROCUREMENT PROVISIONS 

tent as the report originally was submitted to the Secretary and 

Under Secretary and shall be accompanied by such comments as 

the Secretary may wish to make on the report. 

(4) A final decision within the Department of Defense to proceed with a major defense acquisition program beyond low-rate initial production may not be made until the Director has submitted 

to the Secretary of Defense the report with respect to that program 

under paragraph (2) and the congressional defense committees 

have received that report. 

(5) If, before a final decision described in paragraph (4) is made 

for a major defense acquisition program, a decision is made within 

the Department of Defense to proceed to operational use of that 

program or to make procurement funds available for that program, 

the Director shall submit to the Secretary of Defense and the congressional defense committees the report with respect to that program under paragraph (2) as soon as practicable after the decision 

described in this paragraph is made. 

(6) In this subsection, the term ‘‘major defense acquisition program’’ has the meaning given that term in section 139(a)(2)(B) of 

this title. 

(c) DETERMINATION OF QUANTITY OF ARTICLES REQUIRED FOR

OPERATIONAL TESTING.—The quantity of articles of a new system 

that are to be procured for operational testing shall be determined 

by— 

(1) the Director of Operational Test and Evaluation of the 

Department of Defense, in the case of a new system that is a 

major defense acquisition program (as defined in section 

139(a)(2)(B) of this title); or 

(2) the operational test and evaluation agency of the military department concerned, in the case of a new system that 

is not a major defense acquisition program. 

(d) IMPARTIALITY OF CONTRACTOR TESTING PERSONNEL.—In the 

case of a major defense acquisition program (as defined in subsection (a)(2)), no person employed by the contractor for the system 

being tested may be involved in the conduct of the operational test 

and evaluation required under subsection (a). The limitation in the 

preceding sentence does not apply to the extent that the Secretary 

of Defense plans for persons employed by that contractor to be involved in the operation, maintenance, and support of the system 

being tested when the system is deployed in combat. 

(e) IMPARTIAL CONTRACTED ADVISORY AND ASSISTANCE SERVICES.—(1) The Director may not contract with any person for advisory and assistance services with regard to the test and evaluation 

of a system if that person participated in (or is participating in) the 

development, production, or testing of such system for a military 

department or Defense Agency (or for another contractor of the Department of Defense). 

(2) The Director may waive the limitation under paragraph (1) 

in any case if the Director determines in writing that sufficient 

steps have been taken to ensure the impartiality of the contractor 

in providing the services. The Inspector General of the Department 

of Defense shall review each such waiver and shall include in the 

Inspector General’s semi-annual report an assessment of those 

waivers made since the last such report. 
§ 2400 CH. 141—MISC. PROCUREMENT PROVISIONS 1304 

(3)(A) A contractor that has participated in (or is participating 

in) the development, production, or testing of a system for a military department or Defense Agency (or for another contractor of 

the Department of Defense) may not be involved (in any way) in 

the establishment of criteria for data collection, performance assessment, or evaluation activities for the operational test and evaluation. 

(B) The limitation in subparagraph (A) does not apply to a contractor that has participated in such development, production, or 

testing solely in testing for the Federal Government. 

(f) SOURCE OF FUNDS FOR TESTING.—The costs for all tests required under subsection (a) shall be paid from funds available for 

the system being tested. 

(g) DIRECTOR’S ANNUAL REPORT.—As part of the annual report 

of the Director under section 139 of this title, the Director shall describe for each program covered in the report the status of test and 

evaluation activities in comparison with the test and evaluation 

master plan for that program, as approved by the Director. The Director shall include in such annual report a description of each 

waiver granted under subsection (e)(2) since the last such report. 

(h) OPERATIONAL TEST AND EVALUATION DEFINED.—In this section, the term ‘‘operational test and evaluation’’ has the meaning 

given that term in section 139(a)(2)(A) of this title. For purposes of 

subsection (a), that term does not include an operational assessment based exclusively on— 

(1) computer modeling; 

(2) simulation; or 

(3) an analysis of system requirements, engineering proposals, design specifications, or any other information contained in program documents. 

(Added Pub. L. 101–189, div. A, title VIII, Sec. 802(a)(1), Nov. 29, 1989, 103 Stat. 1484; amended Pub. L. 102–484, div. A, title VIII, Sec. 819, Oct. 23, 1992, 106 Stat. 2458; Pub. L. 103–160, 

div. A, title IX, Sec. 904(d)(1), Nov. 30, 1993, 107 Stat. 1728; Pub. L. 103–337, div. A, title X, 

Sec. 1070(a)(11), (f), Oct. 5, 1994, 108 Stat. 2856, 2859; Pub. L. 104–106, div. A, title XV, Sec. 

1502(a)(19), Feb. 10, 1996, 110 Stat. 504; Pub. L. 106–65, div. A, title X, Sec. 1067(1), Oct. 5, 

1999, 113 Stat. 774; Pub. L. 107–107, div. A, title X, Sec. 1048(b)(2), Dec. 28, 2001, 115 Stat. 

1225; Pub. L. 107–314, div. A, title X, Sec. 1062(a)(9), Dec. 2, 2002, 116 Stat. 2650; Pub. L. 108– 

136, div. A, title X, Sec. 1043(b)(14), Nov. 24, 2003, 117 Stat. 1611; Pub. L. 109–364, div. A, 

title II, Sec. 231(a), Oct. 17, 2006, 120 Stat. 2131; Pub. L. 111–383, div. A, title VIII, Sec. 814(d), 

Jan. 7, 2011, 124 Stat. 4267.) 

§ 2400. Low-rate initial production of new systems 

(a) DETERMINATION OF QUANTITIES TO BE PROCURED FOR LOWRATE INITIAL PRODUCTION.—(1) In the course of the development of 

a major system, the determination of what quantity of articles of 

that system should be procured for low-rate initial production (including the quantity to be procured for preproduction verification 

articles) shall be made— 

(A) when the milestone B decision with respect to that system is made; and 

(B) by the official of the Department of Defense who makes 

that decision. 

(2) In this section, the term ‘‘milestone B decision’’ means the 

decision to approve the system development and demonstration of 

a major system by the official of the Department of Defense designated to have the authority to make that decision. 
1305 § 2401 CH. 141—MISC. PROCUREMENT PROVISIONS 

(3) Any increase from a quantity determined under paragraph 

(1) may only be made with the approval of the official making the 

determination. 

(4) The quantity of articles of a major system that may be procured for low-rate initial production may not be less than one operationally configured production unit unless another quantity is established at the milestone B decision. 

(5) The Secretary of Defense shall include a statement of the 

quantity determined under paragraph (1) in the first SAR submitted with respect to the program concerned after that quantity 

is determined. If the quantity exceeds 10 percent of the total number of articles to be produced, as determined at the milestone B decision with respect to that system, the Secretary shall include in 

the statement the reasons for such quantity. For purposes of this 

paragraph, the term ‘‘SAR’’ means a Selected Acquisition Report 

submitted under section 2432 of this title. 

(b) LOW-RATE INITIAL PRODUCTION OF WEAPON SYSTEMS.—Except as provided in subsection (c), low-rate initial production with 

respect to a new system is production of the system in the minimum quantity necessary— 

(1) to provide production-configured or representative articles for operational tests pursuant to section 2399 of this title; 

(2) to establish an initial production base for the system; 

and 

(3) to permit an orderly increase in the production rate for 

the system sufficient to lead to full-rate production upon the 

successful completion of operational testing. 

(c) LOW-RATE INITIAL PRODUCTION OF NAVAL VESSEL AND SATELLITE PROGRAMS.—With respect to naval vessel programs and 

military satellite programs, low-rate initial production is production of items at the minimum quantity and rate that (1) preserves 

the mobilization production base for that system, and (2) is feasible, as determined pursuant to regulations prescribed by the Secretary of Defense. 

(Added Pub. L. 101–189, div. A, title VIII, Sec. 803(a), Nov. 29, 1989, 103 Stat. 1487; amended 

Pub. L. 103–355, title III, Sec. 3015, Oct. 13, 1994, 108 Stat. 3332; Pub. L. 104–106, div. A, 

title X, Sec. 1062(d), div. D, title XLIII, Sec. 4321(b)(13), Feb. 10, 1996, 110 Stat. 444, 673; Pub. 

L. 107–107, title VIII, Sec. 821(c), Dec. 28, 2001, 115 Stat. 1182.) 

§ 2401. Requirement for authorization by law of certain contracts relating to vessels, aircraft, and combat vehicles 

(a)(1) The Secretary of a military department may make a contract for the lease of a vessel, aircraft, or combat vehicle or for the 

provision of a service through use by a contractor of a vessel, aircraft, or combat vehicle only as provided in subsection (b) if— 

(A) the contract will be a long-term lease or charter; or 

(B) the terms of the contract provide for a substantial termination liability on the part of the United States. 

(2) The Secretary of a military department may make a contract that is an agreement to lease or charter or an agreement to 

provide services and that is (or will be) accompanied by a contract 

for the actual lease, charter, or provision of services only as provided in subsection (b) if the contract for the actual lease, charter, 
§ 2401 CH. 141—MISC. PROCUREMENT PROVISIONS 1306 

or provision of services is (or will be) a contract described in paragraph (1). 

(b)(1) The Secretary may make a contract described in subsection (a)(1) if— 

(A) the Secretary has been specifically authorized by law 

to make the contract; 

(B) before a solicitation for proposals for the contract was 

issued the Secretary notified the Committee on Armed Services 

and the Committee on Appropriations of the Senate and the 

Committee on Armed Services and the Committee on Appropriations of the House of Representatives of the Secretary’s intention to issue such a solicitation; 

(C) the Secretary has notified those committees of the proposed contract and provided a detailed description of the terms 

of the proposed contract and a justification for entering into 

the proposed contract rather than providing for the lease, charter, or services involved through purchase of the vessel, aircraft, or combat vehicle to be used under the contract, and a 

period of 30 days of continuous session of Congress has expired 

following the date on which notice was received by such committees; and 

(D) the Secretary has certified to those committees— 

(i) that entering into the proposed contract as a means 

of obtaining the vessel, aircraft, or combat vehicle is the 

most cost-effective means of obtaining such vessel, aircraft, 

or combat vehicle; and 

(ii) that the Secretary has determined that the lease 

complies with all applicable laws, Office of Management 

and Budget circulars, and Department of Defense regulations. 

(2) For purposes of paragraph (1)(C), the continuity of a session 

of Congress is broken only by an adjournment of the Congress sine 

die, and the days on which either House is not in session because 

of an adjournment of more than three days to a day certain are excluded in a computation of such 30-day period. 

(3) Upon receipt of a notice under paragraph (1)(C), a committee identified in paragraph (1)(B) may request the Inspector 

General of the Department of Defense or the Comptroller General 

of the United States to conduct a review of the proposed contract 

to determine whether or not such contract meets the requirements 

of this section. 

(4) If a review is requested under paragraph (3), the Inspector 

General of the Department of Defense or the Comptroller General 

of the United States, as the case may be, shall submit to the Secretary and the congressional defense committees a report on such 

review before the expiration of the period specified in paragraph 

(1)(C). 

(5) In the case of a contract described in subsection (a)(1)(B), 

the commander of the special operations command may make a 

contract without regard to this subsection if— 

(A) funds are available and obligated for the full cost of the 

contract (including termination costs) on or before the date the 

contract is awarded; 
1307 § 2401 CH. 141—MISC. PROCUREMENT PROVISIONS 

(B) the Secretary of Defense submits to the congressional 

defense committees a certification that there is no alternative 

for meeting urgent operational requirements other than making the contract; and 

(C) a period of 30 days of continuous session of Congress 

has expired following the date on which the certification was 

received by such committees. 

(c)(1) Funds may not be appropriated for any fiscal year to or 

for any armed force or obligated or expended for— 

(A) the long-term lease or charter of any aircraft, naval 

vessel, or combat vehicle; or 

(B) for the lease or charter of any aircraft, naval vessel, or 

combat vehicle the terms of which provide for a substantial termination liability on the part of the United States, 

unless funds for that purpose have been specifically authorized by 

law. 

(2) Funds appropriated to the Department of Defense may not 

be used to indemnify any person under the terms of a contract entered into under this section— 

(A) for any amount paid or due by any person to the 

United States for any liability arising under the Internal Revenue Code of 1986; or 

(B) to pay any attorneys’ fees in connection with such contract. 

(d)(1)(A) In this section, the term ‘‘long-term lease or charter’’ 

(except as provided in subparagraph (B)) means a lease, charter, 

service contract, or conditional sale agreement— 

(i) the term of which is for a period of five years or longer 

or more than one-half the useful life of the vessel, aircraft, or 

combat vehicle; or 

(ii) the initial term of which is for a period of less than five 

years but which contains an option to renew or extend the 

agreement for a period which, when added to the initial term 

(or any previous renewal or extension), is five years or longer. 

Such term includes the extension or renewal of a lease or charter agreement if the term of the extension or renewal thereof 

is for a period of five years or longer or if the term of the lease 

or charter agreement being extended or renewed was for a period of five years or longer. 

(B) In the case of an agreement under which the lessor first 

places the property in service under the agreement or the property 

has been in service for less than one year and there is allowable 

to the lessor or charterer an investment tax credit or depreciation 

for the property leased, chartered, or otherwise provided under the 

agreement under section 168 of the Internal Revenue Code of 1986 

(unless the lessor or charterer has elected depreciation on a 

straightline method for such property), the term ‘‘long-term lease 

or charter’’ means a lease, charter, service contract, or conditional 

sale agreement— 

(i) the term of which is for a period of three years or 

longer; or 

(ii) the initial term of which is for a period of less than 

three years but which contains an option to renew or extend 

the agreement for a period which, when added to the initial 
§ 2401 CH. 141—MISC. PROCUREMENT PROVISIONS 1308 

term (or any previous renewal or extension), is three years or 

longer. 

Such term includes the extension or renewal of a lease or charter 

agreement if the term of the extension or renewal thereof is for a 

period of three years or longer or if the term of the lease or charter 

agreement being extended or renewed was for a period of three 

years or longer. 

(2) For the purposes of this section, the United States shall be 

considered to have a substantial termination liability under a contract— 

(A) if there is an agreement by the United States under 

the contract to pay an amount not less than the amount equal 

to 25 percent of the value of the vessel, aircraft, or combat vehicle under lease or charter, calculated on the basis of the 

present value of the termination liability of the United States 

under such charter or lease (as determined under regulations 

prescribed by the Secretary of Defense); or 

(B) if (as determined under regulations prescribed by the 

Secretary of Defense) the sum of— 

(i) the present value of the amount of the termination 

liability of the United States under the contract as of the 

end of the term of the contract (exclusive of any option to 

extend the contract); and 

(ii) the present value of the total of the payments to 

be made by the United States under the contract (excluding any option to extend the contract) attributable to capital-hire, 

is more than one-half the price of the vessel, aircraft, or combat vehicle involved. 

(e)(1) Whenever a request is submitted to Congress for the authorization of the long-term lease or charter of aircraft, naval vessels, or combat vehicles or for the authorization of a lease or charter of aircraft, naval vessels, or combat vehicles which provides for 

a substantial termination liability on the part of the United States, 

the Secretary of Defense shall submit with that request an analysis 

of the cost to the United States (including lost tax revenues) of any 

such lease or charter arrangement compared with the cost to the 

United States of direct procurement of the aircraft, naval vessels, 

or combat vehicles by the United States. 

(2) Any such analysis shall be reviewed and evaluated by the 

Director of the Office of Management and Budget and the Secretary of the Treasury within 30 days after the date on which the 

request and analysis are submitted to Congress. The Director and 

Secretary shall conduct such review and evaluation on the basis of 

the guidelines issued pursuant to subsection (f) and shall report to 

Congress in writing on the results of their review and evaluation 

at the earliest practicable date, but in no event more than 45 days 

after the date on which the request and analysis are submitted to 

the Congress. 

(3) Whenever a request is submitted to Congress for the authorization of funds for the Department of Defense for the longterm lease or charter of aircraft, naval vessels, or combat vehicles 

authorized under this section, the Secretary of Defense— 
1309 § 2401 CH. 141—MISC. PROCUREMENT PROVISIONS 

(A) shall indicate in the request what portion of the requested funds is attributable to capital-hire; and 

(B) shall reflect such portion in the appropriate procurement account in the request. 

(f)(1) If a lease or charter covered by this section is a capital 

lease or a lease-purchase— 

(A) the lease or charter shall be treated as an acquisition 

and shall be subject to all applicable statutory and regulatory 

requirements for the acquisition of aircraft, naval vessels, or 

combat vehicles; and 

(B) funds appropriated to the Department of Defense for 

operation and maintenance may not be obligated or expended 

for the lease or charter. 

(2) In this subsection, the terms ‘‘capital lease’’ and ‘‘lease-purchase’’ have the meanings given those terms in Appendix B to Office of Management and Budget Circular A–11, as in effect on January 6, 2006. 

(g) The Director of the Office of Management and Budget and 

the Secretary of the Treasury shall jointly issue guidelines for determining under what circumstances the Department of Defense 

may use lease or charter arrangements for aircraft, naval vessels, 

and combat vehicles rather than directly procuring such aircraft, 

vessels, and combat vehicles. 

(h) The Secretary of a military department may make a contract for the lease of a vessel or for the provision of a service 

through use by a contractor of a vessel, the term of which is for 

a period of greater than two years, but less than five years, only 

if— 

(1) the Secretary has notified the Committee on Armed 

Services and the Committee on Appropriations of the Senate 

and the Committee on Armed Services and the Committee on 

Appropriations of the House of Representatives of the proposed 

contract and included in such notification— 

(A) a detailed description of the terms of the proposed 

contract and a justification for entering into the proposed 

contract rather than obtaining the capability provided for 

by the lease, charter, or services involved through purchase of the vessel; 

(B) a determination that entering into the proposed 

contract as a means of obtaining the vessel is the most 

cost-effective means of obtaining such vessel; and 

(C) a plan for meeting the requirement provided by 

the proposed contract upon completion of the term of the 

lease contract; and 

(2) a period of 30 days of continuous session of Congress 

has expired following the date on which notice was received by 

such committees. 

(Added Pub. L. 98–94, title XII, Sec. 1202(a)(1), Sept. 24, 1983, 97 Stat. 679; amended Pub. L. 

98–525, title XII, Sec. 1232(a), Oct. 19, 1984, 98 Stat. 2600; Pub. L. 100–26, Sec. 7(h)(1), Apr. 

21, 1987, 101 Stat. 282; Pub. L. 103–35, title II, Sec. 201(c)(6), May 31, 1993, 107 Stat. 98; Pub. 

L. 104–106, div. A, title XV, Sec. 1502(a)(20), 1503(a)(21), Feb. 10, 1996, 110 Stat. 504, 512; Pub. 

L. 106–65, div. A, title X, Sec. 1067(1), Oct. 5, 1999, 113 Stat. 774; Pub. L. 106–398, Sec. 1 [[div. 

A], title X, Sec. 1087(a)(13)], Oct. 30, 2000, 114 Stat. 1654, 1654A–291; Pub. L. 109–163, div. 

A, title VIII, Sec. 815(a)–(d)(1), Jan. 6, 2006, 119 Stat. 3381, 3382; Pub. L. 110–181, div. A, title 

VIII, Sec. 824, title X, Sec. 1011, Jan. 28, 2008, 122 Stat. 227, 303; Pub. L. 111–84, div. A, title 

X, Sec. 1073(a)(24), Oct. 28, 2009, 123 Stat. 2473.) 
§ 2401a CH. 141—MISC. PROCUREMENT PROVISIONS 1310 

§ 2401a. Lease of vehicles, equipment, vessels, and aircraft 

(a) LEASING OF COMMERCIAL VEHICLES AND EQUIPMENT.—The 

Secretary of Defense may use leasing in the acquisition of commercial vehicles and equipment whenever the Secretary determines 

that such leasing is practicable and efficient. 

(b) LIMITATION ON CONTRACTS WITH TERMS OF 18 MONTHS OR

MORE.—The Secretary of Defense or the Secretary of a military department may not enter into any contract with a term of 18 

months or more, or extend or renew any contract for a term of 18 

months or more, for any vessel, aircraft, or vehicle, through a lease, 

charter, or similar agreement, unless the Secretary has considered 

all costs of such contract (including estimated termination liability) 

and has determined in writing that the contract is in the best interest of the Government. 

(Added Pub. L. 103–355, title III, Sec. 3065(a)(1), Oct. 13, 1994, 108 Stat. 3337; amended Pub. 

L. 104–106, div. A, title VIII, Sec. 807(a)(1), Feb. 10, 1996, 110 Stat. 391; Pub. L. 105–85, div. 

A, title X, Sec. 1073(a)(52), Nov. 18, 1997, 111 Stat. 1903.) 

§ 2402. Prohibition of contractors limiting subcontractor 

sales directly to the United States 

(a) Each contract for the purchase of supplies or services made 

by the Department of Defense shall provide that the contractor will 

not— 

(1) enter into any agreement with a subcontractor under 

the contract that has the effect of unreasonably restricting 

sales by the subcontractor directly to the United States of any 

item or process (including computer software) made or furnished by the subcontractor under the contract (or any followon production contract); or 

(2) otherwise act to restrict unreasonably the ability of a 

subcontractor to make sales to the United States described in 

clause (1). 

(b) This section does not prohibit a contractor from asserting 

rights it otherwise has under law. 

(c) This section does not apply to a contract that is for an 

amount not greater than the simplified acquisition threshold (as 

defined in section 134 of title 41). 

(d)(1) An agreement between the contractor in a contract for 

the acquisition of commercial items and a subcontractor under such 

contract that restricts sales by such subcontractor directly to persons other than the contractor may not be considered to unreasonably restrict sales by that subcontractor to the United States in violation of the provision included in such contract pursuant to subsection (a) if the agreement does not result in the United States 

being treated differently with regard to the restriction than any 

other prospective purchaser of such commercial items from that 

subcontractor. 

(2) In paragraph (1), the term ‘‘commercial item’’ has the 

meaning given such term in section 103 of title 41. 

(Added Pub. L. 98–525, title XII, Sec. 1234(a), Oct. 19, 1984, 98 Stat. 2601; amended Pub. L. 

103–355, title IV, Sec. 4102(f), title VIII, Sec. 8105(g), Oct. 13, 1994, 108 Stat. 3340, 3392; Pub. 

L. 111–350, Sec. 5(b)(25), Jan. 4, 2011, 124 Stat. 3844.) 
1311 § 2408 CH. 141—MISC. PROCUREMENT PROVISIONS 

[§ 2403. Repealed. Pub. L. 105–85, div. A, title VIII, Sec. 

847(a), Nov. 18, 1997, 111 Stat. 1845] 

[§ 2404. Renumbered 2922e] 

[§ 2405. Repealed. Pub. L. 105–85, div. A, title VIII, Sec. 

810(a)(1), Nov. 18, 1997, 111 Stat. 1839] 

[§ 2406. Repealed. Pub. L. 103–355, title II, Sec. 2201(b)(1), 

Oct. 13, 1994, 108 Stat. 3318] 

[§ 2407. Renumbered 2350b] 

§ 2408. Prohibition on persons convicted of defense-contract 

related felonies and related criminal penalty on defense contractors 

(a) PROHIBITION.—(1) An individual who is convicted of fraud 

or any other felony arising out of a contract with the Department 

of Defense shall be prohibited from each of the following: 

(A) Working in a management or supervisory capacity on 

any defense contract or any first tier subcontract of a defense 

contract. 

(B) Serving on the board of directors of any defense contractor or any subcontractor awarded a contract directly by a 

defense contractor. 

(C) Serving as a consultant to any defense contractor or 

any subcontractor awarded a contract directly by a defense 

contractor. 

(D) Being involved in any other way, as determined under 

regulations prescribed by the Secretary of Defense, with a defense contract or first tier subcontract of a defense contract. 

(2) Except as provided in paragraph (3), the prohibition in 

paragraph (1) shall apply for a period, as determined by the Secretary of Defense, of not less than five years after the date of the 

conviction. 

(3) The prohibition in paragraph (1) may apply with respect to 

an individual for a period of less than five years if the Secretary 

determines that the five-year period should be waived in the interests of national security. 

(4) The prohibition in paragraph (1) does not apply with respect to the following: 

(A) A contract referred to in subparagraph (A), (B), (C), or 

(D) of such paragraph that is not greater than the simplified 

acquisition threshold (as defined in section 134 of title 41). 

(B) A contract referred to in such subparagraph that is for 

the acquisition of commercial items (as defined in section 103 

of title 41). 

(C) A subcontract referred to in such subparagraph that is 

under a contract described in subparagraph (A) or (B). 

(b) CRIMINAL PENALTY.—A defense contractor or subcontractor 

shall be subject to a criminal penalty of not more than $500,000 

if such contractor or subcontractor is convicted of knowingly— 

(1) employing a person under a prohibition under subsection (a); or 
§ 2409 CH. 141—MISC. PROCUREMENT PROVISIONS 1312 

(2) allowing such a person to serve on the board of directors of such contractor or subcontractor. 

(c) SINGLE POINT OF CONTACT FOR INFORMATION.—(1) The Attorney General shall ensure that a single point of contact is established to enable a defense contractor or subcontractor to promptly 

obtain information regarding whether a person that the contractor 

or subcontractor proposes to use for an activity covered by paragraph (1) of subsection (a) is under a prohibition under that subsection. 

(2) The procedure for obtaining such information shall be specified in regulations prescribed by the Secretary of Defense under 

subsection (a). 

(Added Pub. L. 99–500, Sec. 101(c) [title X, Sec. 941(a)(1)), Oct. 18, 1986, 100 Stat. 1783–82, 

1783–161, and Pub. L. 99–591, Sec. 101(c) [title X, Sec. 941(a)(1)), Oct. 30, 1986, 100 Stat. 3341– 

82, 3341–161; Pub. L. 99–661, div. A, title IX, formerly title IV, Sec. 941(a)(1), Nov. 14, 1986, 

100 Stat. 3941, renumbered title IX, Pub. L. 100–26, Sec. 3(5), Apr. 21, 1987, 101 Stat. 273; 

amended Pub. L. 100–456, div. A, title VIII, Sec. 831(a), Sept. 29, 1988, 102 Stat. 2023; Pub. 

L. 101–510, div. A, title VIII, Sec. 812, Nov. 5, 1990, 104 Stat. 1596; Pub. L. 102–484, div. A, 

title VIII, Sec. 815(a), Oct. 23, 1992, 106 Stat. 2454; Pub. L. 103–355, title IV, Sec. 4102(g), title 

VIII, Sec. 8105(h), Oct. 13, 1994, 108 Stat. 3340, 3393; Pub. L. 104–106, div. A, title X, Sec. 

1062(e), Feb. 10, 1996, 110 Stat. 444; Pub. L. 111–350, Sec. 5(b)(26), Jan. 4, 2011, 124 Stat. 

3844.) 

§ 2409. Contractor employees: protection from reprisal for 

disclosure of certain information 

(a) PROHIBITION OF REPRISALS.—An employee of a contractor 

may not be discharged, demoted, or otherwise discriminated 

against as a reprisal for disclosing to a Member of Congress, a representative of a committee of Congress, an Inspector General, the 

Government Accountability Office, a Department of Defense employee responsible for contract oversight or management, or an authorized official of an agency or the Department of Justice information that the employee reasonably believes is evidence of gross mismanagement of a Department of Defense contract or grant, a gross 

waste of Department of Defense funds, a substantial and specific 

danger to public health or safety, or a violation of law related to 

a Department of Defense contract (including the competition for or 

negotiation of a contract) or grant. 

(b) INVESTIGATION OF COMPLAINTS.—(1) A person who believes 

that the person has been subjected to a reprisal prohibited by subsection (a) may submit a complaint to the Inspector General of the 

Department of Defense, or the Inspector General of the National 

Aeronautics and Space Administration in the case of a complaint 

regarding the National Aeronautics and Space Administration. Unless the Inspector General determines that the complaint is frivolous, the Inspector General shall investigate the complaint and, 

upon completion of such investigation, submit a report of the findings of the investigation to the person, the contractor concerned, 

and the head of the agency. 

(2)(A) Except as provided under subparagraph (B), the Inspector General shall make a determination that a complaint is frivolous or submit a report under paragraph (1) within 180 days after 

receiving the complaint. 

(B) If the Inspector General is unable to complete an investigation in time to submit a report within the 180-day period specified 

in subparagraph (A) and the person submitting the complaint 
1313 § 2409 CH. 141—MISC. PROCUREMENT PROVISIONS 

agrees to an extension of time, the Inspector General shall submit 

a report under paragraph (1) within such additional period of time 

as shall be agreed upon between the Inspector General and the 

person submitting the complaint. 

(c) REMEDY AND ENFORCEMENT AUTHORITY.—(1) Not later than 

30 days after receiving an Inspector General report pursuant to 

subsection (b), the head of the agency concerned shall determine 

whether there is sufficient basis to conclude that the contractor 

concerned has subjected the complainant to a reprisal prohibited by 

subsection (a) and shall either issue an order denying relief or shall 

take one or more of the following actions: 

(A) Order the contractor to take affirmative action to abate 

the reprisal. 

(B) Order the contractor to reinstate the person to the position that the person held before the reprisal, together with 

the compensation (including back pay), employment benefits, 

and other terms and conditions of employment that would 

apply to the person in that position if the reprisal had not been 

taken. 

(C) Order the contractor to pay the complainant an 

amount equal to the aggregate amount of all costs and expenses (including attorneys’ fees and expert witnesses’ fees) 

that were reasonably incurred by the complainant for, or in 

connection with, bringing the complaint regarding the reprisal, 

as determined by the head of the agency. 

(2) If the head of an executive agency issues an order denying 

relief under paragraph (1) or has not issued an order within 210 

days after the submission of a complaint under subsection (b), or 

in the case of an extension of time under paragraph (b)(2)(B), not 

later than 30 days after the expiration of the extension of time, and 

there is no showing that such delay is due to the bad faith of the 

complainant, the complainant shall be deemed to have exhausted 

all administrative remedies with respect to the complaint, and the 

complainant may bring a de novo action at law or equity against 

the contractor to seek compensatory damages and other relief 

available under this section in the appropriate district court of the 

United States, which shall have jurisdiction over such an action 

without regard to the amount in controversy. Such an action shall, 

at the request of either party to the action, be tried by the court 

with a jury. 

(3) An Inspector General determination and an agency head 

order denying relief under paragraph (2) shall be admissible in evidence in any de novo action at law or equity brought pursuant to 

this subsection. 

(4) Whenever a person fails to comply with an order issued 

under paragraph (1), the head of the agency shall file an action for 

enforcement of such order in the United States district court for a 

district in which the reprisal was found to have occurred. In any 

action brought under this paragraph, the court may grant appropriate relief, including injunctive relief and compensatory and exemplary damages. 

(5) Any person adversely affected or aggrieved by an order 

issued under paragraph (1) may obtain review of the order’s conformance with this subsection, and any regulations issued to carry 
[§ 2409a CH. 141—MISC. PROCUREMENT PROVISIONS 1314 

out this section, in the United States court of appeals for a circuit 

in which the reprisal is alleged in the order to have occurred. No 

petition seeking such review may be filed more than 60 days after 

issuance of the order by the head of the agency. Review shall conform to chapter 7 of title 5. 

(d) CONSTRUCTION.—Nothing in this section may be construed 

to authorize the discharge of, demotion of, or discrimination 

against an employee for a disclosure other than a disclosure protected by subsection (a) or to modify or derogate from a right or 

remedy otherwise available to the employee. 

(e) DEFINITIONS.—In this section: 

(1) The term ‘‘agency’’ means an agency named in section 

2303 of this title. 

(2) The term ‘‘head of an agency’’ has the meaning provided by section 2302(1) of this title. 

(3) The term ‘‘contract’’ means a contract awarded by the 

head of an agency. 

(4) The term ‘‘contractor’’ means a person awarded a contract or a grant with an agency. 

(5) The term ‘‘Inspector General’’ means an Inspector General appointed under the Inspector General Act of 1978 and 

any Inspector General that receives funding from, or has oversight over contracts awarded for or on behalf of, the Secretary 

of Defense. 

(Added Pub. L. 99–500, Sec. 101(c) [title X, Sec. 942(a)(1)], Oct. 18, 1986, 100 Stat. 1783–82, 

1783–162, and Pub. L. 99–591, Sec. 101(c) [title X, Sec. 942(a)(1)], Oct. 30, 1986, 100 Stat. 3341– 

82, 3341–162; Pub. L. 99–661, div. A, title IX, formerly title IV, Sec. 942(a)(1), Nov. 14, 1986, 

100 Stat. 3942, renumbered title IX, Pub. L. 100–26, Sec. 3(5), Apr. 21, 1987, 101 Stat. 273; 

amended Pub. L. 102–25, title VII, Sec. 701(k)(1), Apr. 6, 1991, 105 Stat. 116; Pub. L. 102–484, 

div. A, title X, Sec. 1052(30)(A), Oct. 23, 1992, 106 Stat. 2500; Pub. L. 103–355, title VI, Sec. 

6005(a), Oct. 13, 1994, 108 Stat. 3364; Pub. L. 104–106, div. D, title XLIII, Sec. 4321(a)(10), Feb. 

10, 1996, 110 Stat. 671; Pub. L. 110–181, div. A, title VIII, Sec. 846, Jan. 28, 2008, 122 Stat. 

241.) 

[§ 2409a. Repealed. Pub. L. 103–355, title VI, Sec. 6005(b)(1), 

Oct. 13, 1994, 108 Stat. 3365] 

§ 2410. Requests for equitable adjustment or other relief: 

certification 

(a) CERTIFICATION REQUIREMENT.—A request for equitable adjustment to contract terms or request for relief under Public Law 

85–804 (50 U.S.C. 1431 et seq.) that exceeds the simplified acquisition threshold may not be paid unless a person authorized to certify the request on behalf of the contractor certifies, at the time the 

request is submitted, that— 

(1) the request is made in good faith, and 

(2) the supporting data are accurate and complete to the 

best of that person’s knowledge and belief. 

(b) RESTRICTION ON LEGISLATIVE PAYMENT OF CLAIMS.—In the 

case of a contract of an agency named in section 2303(a) of this 

title, no provision of a law enacted after September 30, 1994, that 

directs the payment of a particular claim under such contract, a 

particular request for equitable adjustment to any term of such 

contract, or a particular request for relief under Public Law 85–804 

(50 U.S.C. 1431 et seq.) regarding such contract may be implemented unless such provision of law— 

(1) specifically refers to this subsection; and 
1315 § 2410b CH. 141—MISC. PROCUREMENT PROVISIONS 

(2) specifically states that this subsection does not apply 

with respect to the payment directed by that provision of law. 

(c) DEFINITION.—In this section, the term ‘‘simplified acquisition threshold’’ has the meaning given that term in section 134 of 

title 41. 

(Added Pub. L. 103–355, title II, Sec. 2301(a), Oct. 13, 1994, 108 Stat. 3320; amended Pub. L. 

111–350, Sec. 5(b)(27), Jan. 4, 2011, 124 Stat. 3845.) 

§ 2410a. Contracts for periods crossing fiscal years: severable service contracts; leases of real or personal 

property 

(a) AUTHORITY.—(1) The Secretary of Defense, the Secretary of 

a military department, or the Secretary of Homeland Security with 

respect to the Coast Guard when it is not operating as a service 

in the Navy, may enter into a contract for a purpose described in 

paragraph (2) for a period that begins in one fiscal year and ends 

in the next fiscal year if (without regard to any option to extend 

the period of the contract) the contract period does not exceed one 

year. 

(2) The purpose of a contract described in this paragraph is as 

follows: 

(A) The procurement of severable services. 

(B) The lease of real or personal property, including the 

maintenance of such property when contracted for as part of 

the lease agreement. 

(b) OBLIGATION OF FUNDS.—Funds made available for a fiscal 

year may be obligated for the total amount of a contract entered 

into under the authority of subsection (a). 

(Added Pub. L. 100–370, Sec. 1(h)(2), July 19, 1988, 102 Stat. 847; amended Pub. L. 102–190, 

div. A, title III, Sec. 342, Dec. 5, 1991, 105 Stat. 1343; Pub. L. 104–324, title II, Sec. 214(b), 

Oct. 19, 1996, 110 Stat. 3915; Pub. L. 105–85, div. A, title VIII, Sec. 801(a), Nov. 18, 1997, 111 

Stat. 1831; Pub. L. 107–296, title XVII, Sec. 1704(b)(1), Nov. 25, 2002, 116 Stat. 2314; Pub. L. 

108–136, div. A, title X, Sec. 1005(a), (b)(1), Nov. 24, 2003, 117 Stat. 1584.) 

§ 2410b. Contractor inventory accounting systems: standards 

(a) The Secretary of Defense shall prescribe in regulations— 

(1) standards for inventory accounting systems used by 

contractors under contract with the Department of Defense; 

and 

(2) appropriate enforcement requirements with respect to 

such standards. 

(b) The regulations prescribed pursuant to subsection (a) shall 

not apply to a contract that is for an amount not greater than the 

simplified acquisition threshold. 

(c) The regulations prescribed pursuant to subsection (a) shall 

not apply to a contract for the purchase of commercial items (as defined in section 103 of title 41). 

(Added Pub. L. 100–456, div. A, title VIII, Sec. 834(a)(1), Sept. 29, 1988, 102 Stat. 2024; amended Pub. L. 103–355, title IV, Sec. 4102(h), title VIII, Sec. 8105(i), Oct. 13, 1994, 108 Stat. 3341, 

3393; Pub. L. 104–106, div. D, title XLIII, Sec. 4301(a)(1), Feb. 10, 1996, 110 Stat. 656; Pub. 

L. 104–201, div. A, title X, Sec. 1074(b)(3), Sept. 23, 1996, 110 Stat. 2660; Pub. L. 111–350, Sec. 

5(b)(28), Jan. 4, 2011, 124 Stat. 3845.) 
[§ 2410c CH. 141—MISC. PROCUREMENT PROVISIONS 1316 

[§ 2410c. Renumbered 2922f] 

§ 2410d. Subcontracting plans: credit for certain purchases 

(a) PURCHASES BENEFITING SEVERELY HANDICAPPED PER- SONS.—In the case of a business concern that has negotiated a 

small business subcontracting plan with a military department or 

a Defense Agency, purchases made by that business concern from 

qualified nonprofit agencies for the blind or other severely handicapped shall count toward meeting the subcontracting goal provided in that plan. 

(b) DEFINITIONS.—In this section: 

(1) The term ‘‘small business subcontracting plan’’ means 

a plan negotiated pursuant to section 8(d) of the Small Business Act (15 U.S.C. 637(d)) that establishes a goal for the participation of small business concerns as subcontractors under 

a contract. 

(2) The term ‘‘qualified nonprofit agency for the blind or 

other severely handicapped’’ means— 

(A) a qualified nonprofit agency for the blind, as defined in section 8501(7) of title 41; 

(B) a qualified nonprofit agency for other severely disabled, as defined in section 8501(6) of title 41; and 

(C) a central nonprofit agency designated by the Committee for Purchase from People Who Are Blind or Severely Disabled under section 8503(c) of title 41. 

(Added Pub. L. 102–484, div. A, title VIII, Sec. 808(b)(1), Oct. 23, 1992, 106 Stat. 2449; amended 

Pub. L. 103–337, div. A, title VIII, Sec. 804, Oct. 5, 1994, 108 Stat. 2815; Pub. L. 104–106, div. 

D, title XLIII, Sec. 4321(b)(15), Feb. 10, 1996, 110 Stat. 673; Pub. L. 105–85, div. A, title VIII, 

Sec. 835, Nov. 18, 1997, 111 Stat. 1843; Pub. L. 106–65, div. A, title VIII, Sec. 807, Oct. 5, 1999, 

113 Stat. 705; Pub. L. 111–350, Sec. 5(b)(29), Jan. 4, 2011, 124 Stat. 3845.) 

[§ 2410e. Repealed. Pub. L. 103–355, title II, Sec. 2301(b), Oct. 

13, 1994, 108 Stat. 3321] 

§ 2410f. Debarment of persons convicted of fraudulent use 

of ‘‘Made in America’’ labels 

(a) If the Secretary of Defense determines that a person has 

been convicted of intentionally affixing a label bearing a ‘‘Made in 

America’’ inscription, or another inscription with the same meaning, to any product sold in or shipped to the United States that is 

not made in America, the Secretary shall determine, not later than 

90 days after determining that the person has been so convicted, 

whether the person should be debarred from contracting with the 

Department of Defense. 

(b) In this section, the term ‘‘debar’’ has the meaning given 

term by section 2393(c) of this title. 

(Added Pub. L. 102–484, div. A, title VIII, Sec. 834(a)(1), Oct. 23, 1992, 106 Stat. 2461; amended 

Pub. L. 104–106, div. A, title X, Sec. 1062(f), title XV, Sec. 1503(a)(22), Feb. 10, 1996, 110 Stat. 

444, 512; Pub. L. 107–107, title X, Sec. 1048(a)(20), Dec. 28, 2001, 115 Stat. 1223.) 

§ 2410g. Advance notification of contract performance outside the United States 

(a) NOTIFICATION.—(1) A firm that is performing a Department 

of Defense contract for an amount exceeding $10,000,000, or is submitting a bid or proposal for such a contract, shall notify the Department of Defense in advance of any intention of the firm or any 
1317 § 2410i CH. 141—MISC. PROCUREMENT PROVISIONS 

first-tier subcontractor of the firm to perform outside the United 

States and Canada any part of the contract that exceeds $500,000 

in value and could be performed inside the United States or Canada. 

(2) If a firm submitting a bid or proposal for a Department of 

Defense contract is required to submit a notification under this 

subsection, and the firm is aware, at the time it submits its bid or 

proposal, that the firm intends to perform outside the United 

States and Canada any part of the contract that exceeds $500,000 

in value and could be performed inside the United States or Canada, the firm shall include the notification in its bid or proposal. 

(3) The notification by a firm under paragraph (1) with respect 

to a first-tier subcontractor shall be made, to the maximum extent 

practicable, at least 30 days before award of the subcontract. 

(b) RECIPIENT OF NOTIFICATION.—The firm shall transmit the 

notification— 

(1) in the case of a contract of a military department, to 

such officer or employee of that military department as the 

Secretary of the military department may direct; and 

(2) in the case of any other Department of Defense contract, to such officer or employee of the Department of Defense 

as the Secretary of Defense may direct. 

(c) AVAILABILITY OF NOTIFICATIONS.—The Secretary of Defense 

shall ensure that the notifications (or copies) are maintained in 

compiled form for a period of 5 years after the date of submission 

and are available for use in the preparation of the national defense 

technology and industrial base assessment carried out under section 2505 of this title. 

(d) INAPPLICABILITY TO CERTAIN CONTRACTS.—This section 

shall not apply to contracts for any of the following: 

(1) Commercial items (as defined in section 103 of title 41). 

(2) Military construction. 

(3) Ores. 

(4) Natural gas. 

(5) Utilities. 

(6) Petroleum products and crudes. 

(7) Timber. 

(8) Subsistence. 

(Added Pub. L. 102–484, div. A, title VIII, Sec. 840(a)(1), Oct. 23, 1992, 106 Stat. 2466; amended 

Pub. L. 104–106, div. D, title XLIII, Sec. 4321(b)(16), Feb. 10, 1996, 110 Stat. 673; Pub. L. 111– 

350, Sec. 5(b)(30), Jan. 4, 2011, 124 Stat. 3845.) 

[§ 2410h. Renumbered 1747] 

§ 2410i. Prohibition on contracting with entities that comply 

with the secondary Arab boycott of Israel 

(a) POLICY.—Under section 3(5)(A) of the Export Administration Act of 1979 (50 U.S.C. App. 2402(5)(A)), it is the policy of the 

United States to oppose restrictive trade practices or boycotts fostered or imposed by foreign countries against other countries 

friendly to the United States or against any other United States 

person. 

(b) PROHIBITION.—(1) Consistent with the policy referred to in 

subsection (a), the Department of Defense may not award a contract for an amount in excess of the simplified acquisition threshold 
§ 2410j CH. 141—MISC. PROCUREMENT PROVISIONS 1318 

(as defined in section 134 of title 41) to a foreign entity unless that 

entity certifies to the Secretary of Defense that it does not comply 

with the secondary Arab boycott of Israel. 

(2) In paragraph (1), the term ‘‘foreign entity’’ means a foreign 

person, a foreign company, or any other foreign entity. 

(c) WAIVER AUTHORITY.—The Secretary of Defense may waive 

the prohibition in subsection (b) in specific instances when the Secretary determines that the waiver is necessary in the national security interests of the United States. Within 15 days after the end 

of each fiscal year, the Secretary shall submit to Congress a report 

identifying each contract for which a waiver was granted under 

this subsection during that fiscal year. 

(d) EXCEPTIONS.—Subsection (b) does not apply— 

(1) to contracts for consumable supplies, provisions, or 

services that are intended to be used for the support of United 

States forces or of allied forces in a foreign country; or 

(2) to contracts pertaining to the use of any equipment, 

technology, data, or services for intelligence or classified purposes by the United States Government in the interests of national security or to the acquisition or lease of any such equipment, technology, data, or services by the United States Government in the interests of national security. 

(Added Pub. L. 102–484, div. A, title XIII, Sec. 1332(a), Oct. 23, 1992, 106 Stat. 2555; amended 

Pub. L. 111–350, Secs. 4, 5(b)(31), Jan. 4, 2011, 124 Stat. 3841, 3845.) 

§ 2410j. Displaced contractor employees: assistance to obtain certification and employment as teachers or 

employment as teachers’ aides 

(a) ASSISTANCE PROGRAM.—The Secretary of Defense may 

enter into a cooperative agreement with a defense contractor in 

order— 

(1) to assist an eligible scientist or engineer employed by 

the contractor whose employment is terminated to obtain— 

(A) certification or licensure as an elementary or secondary school teacher; or 

(B) the credentials necessary to serve as a teacher’s 

aide; and 

(2) to facilitate the employment of the scientist or engineer 

by a local educational agency that— 

(A) is receiving a grant under title I of the Elementary 

and Secondary Education Act of 1965 (20 U.S.C. 6301 et 

seq.) as a result of having within its jurisdiction concentrations of children from low-income families; and 

(B) is also experiencing a shortage of teachers or 

teachers’ aides. 

(b) ELIGIBLE DEFENSE CONTRACTORS.—(1) The Secretary of Defense shall establish an application and selection process for the 

participation of defense contractors in a cooperative agreement authorized under subsection (a). 

(2) The Secretary shall determine which defense contractors 

are eligible to participate in the placement program on the basis 

of applications submitted under subsection (c). The Secretary shall 

limit participation to those defense contractors or subcontractors 

that— 
1319 § 2410j CH. 141—MISC. PROCUREMENT PROVISIONS 

(A) produce goods or services for the Department of Defense pursuant to a defense contract or operate nuclear weapons manufacturing facilities for the Department of Energy; and 

(B) have recently reduced operations, or are likely to reduce operations, due to the completion or termination of a defense contract or program or by reductions in defense spending. 

(3) The Secretary shall give special consideration to defense 

contractors who are located in areas that have been hit particularly 

hard by reductions in defense spending. 

(c) DEFENSE CONTRACTOR APPLICATIONS.—(1) A defense contractor desiring to enter into a cooperative agreement with the Secretary of Defense under subsection (a) shall submit an application 

to the Secretary containing the following: 

(A) Evidence that the contractor has been, or is expected 

to be, adversely affected by the completion or termination of a 

defense contract or program or by reductions in defense spending. 

(B) An explanation that scientists and engineers employed 

by the contractor have been terminated, laid off, or retired, or 

are likely to be terminated, laid off, or retired, as a result of 

the completion or termination of a defense contract or program 

or reductions in defense spending. 

(C) A description of programs implemented or proposed by 

the contractor to assist these scientists and engineers. 

(D) A commitment to help fund the costs associated with 

the placement program by paying 50 percent of the stipend 

provided under subsection (g) to an employee or former employee of the contractor selected to receive assistance under 

this section. 

(2) Once a cooperative agreement is entered into under subsection (a) between the Secretary and the defense contractor, the 

contractor shall publicize the program and distribute applications 

to prospective participants, and assist the prospective participants 

with the State screening process. 

(d) ELIGIBLE SCIENTISTS AND ENGINEERS.—An individual shall 

be eligible for selection by the Secretary of Defense to receive assistance under this section if the individual— 

(1) is employed or has been employed for not less than five 

years as a scientist or engineer with a private defense contractor that has entered into an agreement under subsection 

(a); 

(2) has received— 

(A) in the case of an individual applying for assistance 

for placement as an elementary or secondary school teacher, a baccalaureate or advanced degree from an accredited 

institution of higher education; or 

(B) in the case of an individual applying for assistance 

for placement as a teacher’s aide in an elementary or secondary school, an associate, baccalaureate, or advanced degree from an accredited institution of higher education or 

a junior or community college; and 

(3) has been terminated or laid off (or received notice of 

termination or lay off) as a result of the completion or termi-
§ 2410j CH. 141—MISC. PROCUREMENT PROVISIONS 1320 

nation of a defense contract or program or reductions in defense spending; and 

(4) satisfies such other criteria for selection as the Secretary may prescribe. 

(e) SELECTION OF PARTICIPANTS.—(1) In selecting participants 

to receive assistance for placement as elementary or secondary 

school teachers, the Secretary shall give priority to individuals 

who— 

(A) have educational, military, or employment experience 

in science, mathematics, or engineering and agree to seek employment as science, mathematics, or engineering teachers in 

elementary or secondary schools; or 

(B) have educational, military, or employment experience 

in another subject area identified by the Secretary, in consultation with the Secretary of Education, as important for national 

educational objectives and agree to seek employment in that 

subject area in elementary or secondary schools. 

(2) The Secretary may not select an individual under this section unless the Secretary has sufficient appropriations to carry out 

this section available at the time of the selection to satisfy the obligations to be incurred by the United States under this section with 

respect to that individual. 

(f) AGREEMENT.—An individual selected under this section 

shall be required to enter into an agreement with the Secretary in 

which the participant agrees— 

(1) to obtain, within such time as the Secretary may require, certification or licensure as an elementary or secondary 

school teacher or the necessary credentials to serve as a teacher’s aide in an elementary or secondary school; and 

(2) to accept— 

(A) in the case of an individual selected for assistance 

for placement as a teacher, an offer of full-time employment as an elementary or secondary school teacher for not 

less than two school years with a local educational agency 

identified under section 1151(b)(2) of this title, as in effect 

on October 4, 1999, to begin the school year after obtaining 

that certification or licensure; or 

(B) in the case of an individual selected for assistance 

for placement as a teacher’s aide, an offer of full-time employment as a teacher’s aide in an elementary or secondary school for not less than two school years with a 

local educational agency identified under section 1151(b)(3) 

of this title, as in effect on October 4, 1999, to begin the 

school year after obtaining the necessary credentials. 

(g) STIPEND FOR PARTICIPANTS.—(1) The Secretary of Defense 

shall pay to each participant in the placement program a stipend 

in an amount equal to the lesser of— 

(A) $5,000; or 

(B) the total costs of the type described in paragraphs (1), 

(2), (3), (8), and (9) of section 472 of the Higher Education Act 

of 1965 (20 U.S.C. 1087ll) incurred by the participant while obtaining teacher certification or licensure or the necessary credentials to serve as a teacher’s aide and employment as an elementary or secondary school teacher or teacher aide. 
1321 § 2410l CH. 141—MISC. PROCUREMENT PROVISIONS 

(2) A stipend provided under this section shall be taken into 

account in determining the eligibility of the participant for Federal 

student financial assistance provided under title IV of the Higher 

Education Act of 1965 (20 U.S.C. 1070 et seq.). 

(h) PLACEMENT OF PARTICIPANTS AS TEACHERS AND TEACHERS’ 

AIDES.—Subsections (h) through (k) of section 1151 of this title, as 

in effect on October 4, 1999, shall apply with respect to the placement as teachers and teachers’ aides of individuals selected under 

this section. 

(Added Pub. L. 102–484, div. D, title XLIV, Sec. 4443(a), Oct. 23, 1992, 106 Stat. 2732, Sec. 

2410c; renumbered Sec. 2410j and amended Pub. L. 103–35, title II, Sec. 201(b)(1)(A), (g)(6), 

May 31, 1993, 107 Stat. 97, 100; Pub. L. 103–160, div. A, title XIII, Sec. 1331(c)(3), Nov. 30, 

1993, 107 Stat. 1792; Pub. L. 103–382, title III, Sec. 391(b)(5), Oct. 20, 1994, 108 Stat. 4022; 

Pub. L. 104–106, div. A, title XV, Sec. 1503(a)(23), Feb. 10, 1996, 110 Stat. 512; Pub. L. 104– 

201, div. A, title V, Sec. 576(c), Sept. 23, 1996, 110 Stat. 2535; Pub. L. 106–398, Sec. 1 [[div. 

A], title X, Sec. 1087(a)(14)], Oct. 30, 2000, 114 Stat. 1654, 1654A–291.) 

§ 2410k. Defense contractors: listing of suitable employment 

openings with local employment service office 

(a) REGULATIONS.—The Secretary of Defense shall promulgate 

regulations containing the requirement described in subsection (b) 

and such other provisions as the Secretary considers necessary to 

administer such requirement. Such regulations shall require that 

each contract described in subsection (c) shall contain a clause requiring the contractor to comply with such regulations. 

(b) REQUIREMENT.—The regulations promulgated under this 

section shall require each contractor carrying out a contract described in subsection (c) to list immediately with the appropriate 

local employment service office, and where appropriate the Interstate Job Bank (established by the United States Employment 

Service), all of its suitable employment openings under such contract. 

(c) COVERED CONTRACTS.—The regulations promulgated under 

this section shall apply to any contract entered into with the Department of Defense in an amount of $500,000 or more. 

(Added Pub. L. 102–484, div. D, title XLIV, Sec. 4470(a)(1), Oct. 23, 1992, 106 Stat. 2753, Sec. 

2410d; renumbered Sec. 2410k and amended Pub. L. 103–35, title II, Sec. 201(b)(1)(A), 

202(a)(18)(A), May 31, 1993, 107 Stat. 97, 102.) 

§ 2410l. Contracts for advisory and assistance services: cost 

comparison studies 

(a) REQUIREMENT.—(1)(A) Before the Secretary of Defense enters into a contract described in subparagraph (B), the Secretary 

shall determine whether Department of Defense personnel have 

the capability to perform the services proposed to be covered by the 

contract. 

(B) Subparagraph (A) applies to any contract of the Department of Defense for advisory and assistance services that is expected to have a value in excess of $100,000. 

(2) If the Secretary determines that Department of Defense 

personnel have the capability to perform the services to be covered 

by the contract, the Secretary shall conduct a study comparing the 

cost of performing the services with Department of Defense personnel and the cost of performing the services with contractor personnel. 
§ 2410m CH. 141—MISC. PROCUREMENT PROVISIONS 1322 

4 In subsection (b)(1)(A)(i), ‘‘section 7 of such Act’’ should be ‘‘section 7104(a) of such title’’. 

5 In subsection (b)(1)(B)(ii), ‘‘section 7 of the Contract Disputes Act of 1978’’ should be ‘‘section 

7104(a) of title 41’’. 

(b) WAIVER.—The Secretary of Defense may, pursuant to guidelines prescribed by the Secretary, waive the requirement to perform a cost comparison study under subsection (a)(2) based on factors that are not related to cost. 

(Added Pub. L. 103–337, div. A, title III, Sec. 363(a)(1), Oct. 5, 1994, 108 Stat. 2733.) 

§ 2410m. Retention of amounts collected from contractor 

during the pendency of contract dispute 

(a) RETENTION OF FUNDS.—Notwithstanding sections 1552(a) 

and 3302(b) of title 31, any amount, including interest, collected 

from a contractor as a result of a claim made by a military department or Defense Agency under chapter 71 of title 41, shall remain 

available in accordance with this section to pay— 

(1) any settlement of the claim by the parties; 

(2) any judgment rendered in the contractor’s favor on an 

appeal of the decision on that claim to the Armed Services 

Board of Contract Appeals under section 7104(a) of title 41; or 

(3) any judgment rendered in the contractor’s favor in an 

action on that claim in a court of the United States. 

(b) PERIOD OF AVAILABILITY.—(1) The period of availability of 

an amount under subsection (a), in connection with a claim— 

(A) expires 180 days after the expiration of the period for 

bringing an action on that claim in the United States Court of 

Federal Claims under section 7104(b) of title 41 if, within that 

180-day period— 

(i) no appeal on the claim is commenced at the Armed 

Services Board of Contract Appeals under section 7 of such 

Act 4; and 

(ii) no action on the claim is commenced in a court of 

the United States; or 

(B) if not expiring under subparagraph (A), expires— 

(i) in the case of a settlement of the claim, 180 days 

after the date of the settlement; or 

(ii) in the case of a judgment rendered on the claim in 

an appeal to the Armed Services Board of Contract Appeals under section 7 of the Contract Disputes Act of 

1978 5 or an action in a court of the United States, 180 

days after the date on which the judgment becomes final 

and not appealable. 

(2) While available under this section, an amount may be obligated or expended only for a purpose described in subsection (a). 

(3) Upon the expiration of the period of availability of an 

amount under paragraph (1), the amount shall be covered into the 

Treasury as miscellaneous receipts. 

(c) ANNUAL REPORT.—Not later than 60 days after the end of 

each fiscal year, the Under Secretary of Defense (Comptroller) shall 

submit to Congress a report on the amounts, if any, that are available for obligation pursuant to this section. The report shall include, at a minimum, the following: 
1323 § 2410n CH. 141—MISC. PROCUREMENT PROVISIONS 

(1) The total amount available for obligation at the end of 

such fiscal year. 

(2) The total amount collected from contractors under this 

section during that fiscal year. 

(3) The total amount disbursed under this section during 

that fiscal year and a description of the purpose for each disbursement. 

(4) The total amount returned to the Treasury under this 

section during that fiscal year. 

(Added Pub. L. 105–85, div. A, title VIII, Sec. 831(a), Nov. 18, 1997, 111 Stat. 1841; amended 

Pub. L. 108–136, div. A, title X, Sec. 1031(a)(21), Nov. 24, 2003, 117 Stat. 1598; Pub. L. 111– 

350, Sec. 5(b)(32), Jan. 4, 2011, 124 Stat. 3845.) 

§ 2410n. Products of Federal Prison Industries: procedural 

requirements 

(a) PRODUCTS FOR WHICH FEDERAL PRISON INDUSTRIES DOES

NOT HAVE SIGNIFICANT MARKET SHARE.—(1) Before purchasing a 

product listed in the latest edition of the Federal Prison Industries 

catalog under section 4124(d) of title 18 for which Federal Prison 

Industries does not have a significant market share, the Secretary 

of Defense shall conduct market research to determine whether the 

product is comparable to products available from the private sector 

that best meet the needs of the Department in terms of price, quality, and time of delivery. 

(2) If the Secretary determines that a Federal Prison Industries product described in paragraph (1) is not comparable in price, 

quality, or time of delivery to products of the private sector that 

best meets the needs of the Department in terms of price, quality, 

and time of delivery, the Secretary shall use competitive procedures for the procurement of the product, or shall make an individual purchase under a multiple award contract in accordance 

with the competition requirements applicable to such contract. In 

conducting such a competition, the Secretary shall consider a timely offer from Federal Prison Industries. 

(b) PRODUCTS FOR WHICH FEDERAL PRISON INDUSTRIES HAS

SIGNIFICANT MARKET SHARE.—(1) The Secretary of Defense may 

purchase a product listed in the latest edition of the Federal Prison 

Industries catalog for which Federal Prison Industries has a significant market share only if the Secretary uses competitive procedures for the procurement of the product or makes an individual 

purchase under a multiple award contract in accordance with the 

competition requirements applicable to such contract. In conducting 

such a competition, the Secretary shall consider a timely offer from 

Federal Prison Industries. 

(2) For purposes of this subsection, Federal Prison Industries 

shall be treated as having a significant share of the market for a 

product if the Secretary, in consultation with the Administrator of 

Federal Procurement Policy, determines that the Federal Prison Industries share of the Department of Defense market for the category of products including such product is greater than 5 percent. 

(c) IMPLEMENTATION BY SECRETARY OF DEFENSE.—The Secretary of Defense shall ensure that— 

(1) the Department of Defense does not purchase a Federal 

Prison Industries product or service unless a contracting officer 
§ 2410n CH. 141—MISC. PROCUREMENT PROVISIONS 1324 

of the Department determines that the product or service is 

comparable to products or services available from the private 

sector that best meet the Department’s needs in terms of price, 

quality, and time of delivery; and 

(2) Federal Prison Industries performs its contractual obligations to the same extent as any other contractor for the Department of Defense. 

(d) MARKET RESEARCH DETERMINATION NOT SUBJECT TO RE- VIEW.—A determination by a contracting officer regarding whether 

a product or service offered by Federal Prison Industries is comparable to products or services available from the private sector 

that best meet the Department’s needs in terms of price, quality, 

and time of delivery shall not be subject to review pursuant to section 4124(b) of title 18. 

(e) PERFORMANCE AS A SUBCONTRACTOR.—(1) A contractor or 

potential contractor of the Department of Defense may not be required to use Federal Prison Industries as a subcontractor or supplier of products or provider of services for the performance of a 

Department of Defense contract by any means, including means 

such as— 

(A) a contract solicitation provision requiring a contractor 

to offer to make use of products or services of Federal Prison 

Industries in the performance of the contract; 

(B) a contract specification requiring the contractor to use 

specific products or services (or classes of products or services) 

offered by Federal Prison Industries in the performance of the 

contract; or 

(C) any contract modification directing the use of products 

or services of Federal Prison Industries in the performance of 

the contract. 

(2) In this subsection, the term ‘‘contractor’’, with respect to a 

contract, includes a subcontractor at any tier under the contract. 

(f) PROTECTION OF CLASSIFIED AND SENSITIVE INFORMATION.— 

The Secretary of Defense may not enter into any contract with Federal Prison Industries under which an inmate worker would have 

access to— 

(1) any data that is classified; 

(2) any geographic data regarding the location of— 

(A) surface and subsurface infrastructure providing 

communications or water or electrical power distribution; 

(B) pipelines for the distribution of natural gas, bulk 

petroleum products, or other commodities; or 

(C) other utilities; or 

(3) any personal or financial information about any individual private citizen, including information relating to such 

person’s real property however described, without the prior 

consent of the individual. 

(g) DEFINITIONS.—In this section: 

(1) The term ‘‘competitive procedures’’ has the meaning 

given such term in section 2302(2) of this title. 

(2) The term ‘‘market research’’ means obtaining specific 

information about the price, quality, and time of delivery of 

products available in the private sector through a variety of 

means, which may include— 
1325 § 2410p CH. 141—MISC. PROCUREMENT PROVISIONS 

(A) contacting knowledgeable individuals in government and industry; 

(B) interactive communication among industry, acquisition personnel, and customers; and 

(C) interchange meetings or pre-solicitation conferences with potential offerors. 

(Added Pub. L. 107–107, div. A, title VIII, Sec. 811(a)(1), Dec. 28, 2001, 115 Stat. 1180; amended 

Pub. L. 107–314, div. A, title VIII, Sec. 819(a)(1), Dec. 2, 2002, 116 Stat. 2612; Pub. L. 109– 

163, div. A, title X, Sec. 1056(c)(4), Jan. 6, 2006, 119 Stat. 3439; Pub. L. 110–181, div. A, title 

VIII, Sec. 827(a)(1), Jan. 28, 2008, 122 Stat. 228.) 

§ 2410o. Multiyear procurement authority: purchase of 

dinitrogen tetroxide, hydrazine, and hydrazinerelated products 

(a) TEN-YEAR CONTRACT PERIOD.—The Secretary of Defense 

may enter into a contract for a period of up to 10 years for the purchase of dinitrogen tetroxide, hydrazine, and hydrazine-related 

products for the support of a United States national security program or a United States space program. 

(b) EXTENSIONS.—A contract entered into for more than one 

year under the authority of subsection (a) may be extended for a 

total of not more than 10 years pursuant to any option or options 

set forth in the contract. 

(Added Pub. L. 107–314, div. A, title VIII, Sec. 826(a), Dec. 2, 2002, 116 Stat. 2617.) 

§ 2410p. Contracts: limitations on lead system integrators 

(a) IN GENERAL.—Except as provided in subsection (b), no entity performing lead system integrator functions in the acquisition of 

a major system by the Department of Defense may have any direct 

financial interest in the development or construction of any individual system or element of any system of systems. 

(b) EXCEPTION.—An entity described in subsection (a) may 

have a direct financial interest in the development or construction 

of an individual system or element of a system of systems if— 

(1) the Secretary of Defense certifies to the Committees on 

Armed Services of the Senate and the House of Representatives that— 

(A) the entity was selected by the Department of Defense as a contractor to develop or construct the system or 

element concerned through the use of competitive procedures; and 

(B) the Department took appropriate steps to prevent 

any organizational conflict of interest in the selection process; or 

(2) the entity was selected by a subcontractor to serve as 

a lower-tier subcontractor, through a process over which the 

entity exercised no control. 

(c) CONSTRUCTION.—Nothing in this section shall be construed 

to preclude an entity described in subsection (a) from performing 

work necessary to integrate two or more individual systems or elements of a system of systems with each other. 

(Added Pub. L. 109–364, div. A, title VIII, Sec. 807(a)(1), Oct. 17, 2006, 120 Stat. 2315.) 
§ 2410q CH. 141—MISC. PROCUREMENT PROVISIONS 1326 

§ 2410q. Multiyear contracts: purchase of electricity from renewable energy sources 

(a) MULTIYEAR CONTRACTS AUTHORIZED.—Subject to subsection 

(b), the Secretary of Defense may enter into a contract for a period 

not to exceed 10 years for the purchase of electricity from sources 

of renewable energy, as that term is defined in section 203(b)(2) of 

the Energy Policy Act of 2005 (42 U.S.C. 15852(b)(2)). 

(b) LIMITATIONS ON CONTRACTS FOR PERIODS IN EXCESS OF

FIVE YEARS.—The Secretary may exercise the authority in subsection (a) to enter into a contract for a period in excess of five 

years only if the Secretary determines, on the basis of a business 

case analysis prepared by the Department of Defense, that— 

(1) the proposed purchase of electricity under such contract 

is cost effective for the Department of Defense; and 

(2) it would not be possible to purchase electricity from the 

source in an economical manner without the use of a contract 

for a period in excess of five years. 

(c) RELATIONSHIP TO OTHER MULTIYEAR CONTRACTING AUTHORITY.—Nothing in this section shall be construed to preclude the Department of Defense from using other multiyear contracting authority of the Department to purchase renewable energy. 

(Added Pub. L. 110–181, div. A, title VIII, Sec. 828(a), Jan. 28, 2008, 122 Stat. 229.) 
1327 

CHAPTER 142—PROCUREMENT TECHNICAL ASSISTANCE 

COOPERATIVE AGREEMENT PROGRAM 

Sec. 

2411. Definitions. 

2412. Purposes. 

2413. Cooperative agreements. 

2414. Limitation. 

2415. Distribution. 

2416. Subcontractor information. 

2417. Administrative costs. 

2418. Authority to provide certain types of technical assistance. 

2419. Regulations. 

§ 2411. Definitions 

In this chapter: 

(1) The term ‘‘eligible entity’’ means any of the following: 

(A) A State. 

(B) A local government. 

(C) A private, nonprofit organization. 

(D) A tribal organization, as defined in section 4(l) of 

the Indian Self-Determination and Education Assistance 

Act (Public Law 93–638; 25 U.S.C. 450b(l)), or an economic 

enterprise, as defined in section 3(e) of the Indian Financing Act of 1974 (Public Law 93–262; 25 U.S.C. 1452(e)), 

whether or not such economic enterprise is organized for 

profit purposes or nonprofit purposes. 

(2) The term ‘‘distressed area’’ means— 

(A) the area of a unit of local government (or such 

area excluding the area of any defined political jurisdiction 

within the area of such unit of local government) that— 

(i) has a per capita income of 80 percent or less 

of the State average; or 

(ii) has an unemployment rate that is one percent 

greater than the national average for the most recent 

24-month period for which statistics are available; or 

(B) a reservation, as defined in section 3(d) of the Indian Financing Act of 1974 (Public Law 93–262; 25 U.S.C. 

1452(d)). 

(3) The term ‘‘Secretary’’ means the Secretary of Defense 

acting through the Director of the Defense Logistics Agency. 

(4) The terms ‘‘State’’ and ‘‘local government’’ have the 

meaning given those terms in section 6302 of title 31. 

(Added Pub. L. 98–525, title XII, Sec. 1241(a)(1), Oct. 19, 1984, 98 Stat. 2605; amended Pub. 

L. 99–145, title IX, Sec. 919(a), Nov. 8, 1985, 99 Stat. 691; Pub. L. 99–500, Sec. 101(c) [title 

X, Sec. 956(a)], Oct. 18, 1986, 100 Stat. 1783–82, 1783–174, and Pub. L. 99–591, Sec. 101(c) 

[title X, Sec. 956(a)], Oct. 30, 1986, 100 Stat. 3341–82, 3341–174; Pub. L. 99–661, div. A, title 

IX, formerly title IV, Sec. 956(a), Nov. 14, 1986, 100 Stat. 3954, renumbered title IX, Pub. L. 

100–26, Sec. 3(5), Apr. 21, 1987, 101 Stat. 273; Pub. L. 100–180, div. A, title VIII, Sec. 807(b), 

Dec. 4, 1987, 101 Stat. 1128; Pub. L. 100–456, div. A, title VIII, Sec. 841(b)(2), Sept. 29, 1988, 

102 Stat. 2025; Pub. L. 101–189, div. A, title VIII, Sec. 853(e), Nov. 29, 1989, 103 Stat. 1519; 
§ 2412 CH. 142—PROCUREMENT TECH ASSTNCE COOP PGM 1328 

Pub. L. 102–25, title VII, Sec. 701(j)(5), Apr. 6, 1991, 105 Stat. 116; Pub. L. 102–484, div. A, 

title X, Sec. 1052(31), Oct. 23, 1992, 106 Stat. 2501.) 

§ 2412. Purposes 

The purposes of the program authorized by this chapter are— 

(1) to increase assistance by the Department of Defense to 

eligible entities furnishing procurement technical assistance to 

business entities; and 

(2) to assist eligible entities in the payment of the costs of 

establishing and carrying out new procurement technical assistance programs and maintaining existing procurement technical assistance programs. 

(Added Pub. L. 98–525, title XII, Sec. 1241(a)(1), Oct. 19, 1984, 98 Stat. 2605; amended Pub. 

L. 99–145, title IX, Sec. 919(a), Nov. 8, 1985, 99 Stat. 692.) 

§ 2413. Cooperative agreements 

(a) The Secretary, in accordance with the provisions of this 

chapter, may enter into cooperative agreements with eligible entities to carry out the purposes of this chapter. 

(b) Under any such cooperative agreement, the eligible entity 

shall agree to sponsor programs to furnish procurement technical 

assistance to business entities and the Secretary shall agree to defray not more than one-half of the eligible entity’s cost of furnishing such assistance under such programs, except that in the 

case of a program sponsored by such an entity that provides services solely in a distressed area, the Secretary may agree to furnish 

more than one-half, but not more than three-fourths, of such cost 

with respect to such program. 

(c) In entering into cooperative agreements under subsection 

(a), the Secretary shall assure that at least one procurement technical assistance program is carried out in each Department of Defense contract administration services district during each fiscal 

year. 

(d) In conducting a competition for the award of a cooperative 

agreement under subsection (a), and in determining the level of 

funding to provide under an agreement under subsection (b), the 

Secretary shall give significant weight to successful past performance of eligible entities under a cooperative agreement under this 

section. 

(Added Pub. L. 98–525, title XII, Sec. 1241(a)(1), Oct. 19, 1984, 98 Stat. 2605; amended Pub. 

L. 99–145, title IX, Sec. 919(a), Nov. 8, 1985, 99 Stat. 692; Pub. L. 99–500, Sec. 101(c) [title 

X, Sec. 956(b)], Oct. 18, 1986, 100 Stat. 1783–82, 1783–174, and Pub. L. 99–591, Sec. 101(c) 

[title X, Sec. 956(b)], Oct. 30, 1986, 100 Stat. 3341–82, 3341–174; Pub. L. 99–661, div. A, title 

IX, formerly title IV, Sec. 956(b), Nov. 14, 1986, 100 Stat. 3954, renumbered title IX, Pub. L. 

100–26, Sec. 3(5), Apr. 21, 1987, 101 Stat. 273, and amended Pub. L. 100–180, div. A, title XII, 

Sec. 1233(b), Dec. 4, 1987, 101 Stat. 1161; Pub. L. 105–261, div. A, title VIII, Sec. 802(a)(1), 

Oct. 17, 1998, 112 Stat. 2081; Pub. L. 107–314, div. A, title VIII, Sec. 814, Dec. 2, 2002, 116 

Stat. 2610.) 

§ 2414. Limitation 

(a) IN GENERAL.—The value of the assistance furnished by the 

Secretary to any eligible entity to carry out a procurement technical assistance program under a cooperative agreement under this 

chapter during any fiscal year may not exceed— 

(1) in the case of a program operating on a Statewide 

basis, other than a program referred to in clause (3) or (4), 

$600,000; 
1329 § 2416 CH. 142—PROCUREMENT TECH ASSTNCE COOP PGM 

(2) in the case of a program operating on less than a Statewide basis, other than a program referred to in clause (3) or 

(4), $300,000; 

(3) in the case of a program operated wholly within one 

service area of the Bureau of Indian Affairs by an eligible entity referred to in section 2411(1)(D) of this title, $150,000; or 

(4) in the case of a program operated wholly within more 

than one service area of the Bureau of Indian Affairs by an eligible entity referred to in section 2411(1)(D) of this title, 

$600,000. 

(b) DETERMINATIONS ON SCOPE OF OPERATIONS.—A determination of whether a procurement technical assistance program is operating on a Statewide basis or on less than a Statewide basis or 

is operated wholly within one or more service areas of the Bureau 

of Indian Affairs by an eligible entity referred to in section 

2411(1)(D) of this title shall be made in accordance with regulations prescribed by the Secretary of Defense. 

(Added Pub. L. 98–525, title XII, Sec. 1241(a)(1), Oct. 19, 1984, 98 Stat. 2606; amended Pub. 

L. 99–145, title IX, Sec. 919(a), Nov. 8, 1985, 99 Stat. 692; Pub. L. 100–456, div. A, title VIII, 

Sec. 841(a), Sept. 29, 1988, 102 Stat. 2025; Pub. L. 101–189, div. A, title VIII, Sec. 819(c), Nov. 

29, 1989, 103 Stat. 1503; Pub. L. 102–25, title VII, Sec. 701(f)(7), Apr. 6, 1991, 105 Stat. 115; 

Pub. L. 107–107, div. A, title VIII, Sec. 813, Dec. 28, 2001, 115 Stat. 1181; Pub. L. 107–314, 

div. A, title VIII, Sec. 815, Dec. 2, 2002, 116 Stat. 2610; Pub. L. 109–163, div. A, title VIII, Sec. 

824, Jan. 6, 2006, 119 Stat. 3387.) 

§ 2415. Distribution 

The Secretary shall allocate funds available for assistance 

under this chapter equally to each Department of Defense contract 

administrative services district. If in any such fiscal year there is 

an insufficient number of satisfactory proposals in a district for cooperative agreements to allow effective use of the funds allocated 

to that district, the funds remaining with respect to that district 

shall be reallocated among the remaining districts. 

(Added Pub. L. 98–525, title XII, Sec. 1241(a)(1), Oct. 19, 1984, 98 Stat. 2606; amended Pub. 

L. 99–145, title IX, Sec. 919(b), Nov. 8, 1985, 99 Stat. 692; Pub. L. 100–180, div. A, title VIII, 

Sec. 807(c), Dec. 4, 1987, 101 Stat. 1128; Pub. L. 105–261, div. A, title VIII, Sec. 802(a)(2), (b), 

Oct. 17, 1998, 112 Stat. 2081; Pub. L. 106–398, Sec. 1 [[div. A], title X, Sec. 1087(d)(5)], Oct. 

30, 2000, 114 Stat. 1654, 1654A–293.) 

§ 2416. Subcontractor information 

(a) The Secretary of Defense shall require that any defense 

contractor in any year shall provide to an eligible entity with which 

the Secretary has entered into a cooperative agreement under this 

chapter, on the request of such entity, the information specified in 

subsection (b). 

(b) Information to be provided under subsection (a) is a listing 

of the name of each appropriate employee of the contractor who has 

responsibilities with respect to entering into contracts on behalf of 

such contractor that constitute subcontracts of contracts being performed by such contractor, together with the business address and 

telephone number and area of responsibility of each such employee. 

(c) A defense contractor need not provide information under 

this section to a particular eligible entity more frequently than 

once a year. 

(d) In this section, the term ‘‘defense contractor’’, for any year, 

means a person awarded a contract with the Department of Defense in that year for an amount in excess of $1,000,000. 
§ 2417 CH. 142—PROCUREMENT TECH ASSTNCE COOP PGM 1330 

(Added Pub. L. 99–500, Sec. 101(c) [title X, Sec. 957(a)(1)(B)], Oct. 18, 1986, 100 Stat. 1783– 

82, 1783–174, and Pub. L. 99–591, Sec. 101(c) [title X, Sec. 957(a)(1)(B)], Oct. 30, 1986, 100 Stat. 

3341–82, 3341–174; Pub. L. 99–661, div. A, title IX, formerly title IV, Sec. 957(a)(1)(B), Nov. 

14, 1986, 100 Stat. 3954, renumbered title IX, Pub. L. 100–26, Sec. 3(5), Apr. 21, 1987, 101 Stat. 

273; Pub. L. 108–375, div. A, title VIII, Sec. 816, Oct. 28, 2004, 118 Stat. 2015.) 

§ 2417. Administrative costs 

The Director of the Defense Logistics Agency may use, out of 

the amount appropriated for a fiscal year for operation and maintenance for the procurement technical assistance program authorized 

by this chapter, an amount not exceeding three percent of such 

amount to defray the expenses of administering the provisions of 

this chapter during such fiscal year. 

(Added Pub. L. 101–510, div. A, title VIII, Sec. 814(a)(1)(B), Nov. 5, 1990, 104 Stat. 1596.) 

§ 2418. Authority to provide certain types of technical assistance 

(a) The procurement technical assistance furnished by eligible 

entities assisted by the Department of Defense under this chapter 

may include technical assistance relating to contracts entered into 

with (1) Federal departments and agencies other than the Department of Defense, and (2) State and local governments. 

(b) An eligible entity assisted by the Department of Defense 

under this chapter also may furnish information relating to assistance and other programs available pursuant to the Defense Conversion, Reinvestment, and Transition Assistance Act of 1992. 

(Added Pub. L. 102–484, div. D, title XLII, Sec. 4236(a)(1)(B), Oct. 23, 1992, 106 Stat. 2691.) 

§ 2419. Regulations 

The Secretary of Defense shall prescribe regulations to carry 

out this chapter. 

(Added Pub. L. 98–525, title XII, Sec. 1241(a)(1), Oct. 19, 1984, 98 Stat. 2606, Sec. 2416; renumbered Sec. 2417, Pub. L. 99–500, Sec. 101(c) [title X, Sec. 957(a)(1)(A)], Oct. 18, 1986, 100 Stat. 

1783–82, 1783–174, and Pub. L. 99–591, Sec. 101(c) [title X, Sec. 957(a)(1)(A)], Oct. 30, 1986, 

100 Stat. 3341–82, 3341–174, and Pub. L. 99–661, div. A, title IX, formerly title IV, Sec. 

957(a)(1)(A), Nov. 14, 1986, 100 Stat. 3954, renumbered title IX, Pub. L. 100–26, Sec. 3(5), Apr. 

21, 1987, 101 Stat. 273; renumbered Sec. 2418, Pub. L. 101–510, div. A, title VIII, Sec. 

814(a)(1)(A), Nov. 5, 1990, 104 Stat. 1596; renumbered Sec. 2419, Pub. L. 102–484, div. D, title 

XLII, Sec. 4236(a)(1)(A), Oct. 23, 1992, 106 Stat. 2691.) 
1331 

CHAPTER 143—PRODUCTION BY MILITARY AGENCIES 

Sec. 

2421. Plantations and farms: operation, maintenance, and improvement. 

2422. Bakery and dairy products: procurement outside the United States. 

2423. Laundry and dry cleaning services: procurement from facilities operated by 

the Navy Resale and Services Support Office. 

2424. Procurement of supplies and services from exchange stores outside the 

United States. 

§ 2421. Plantations and farms: operation, maintenance, and 

improvement 

(a) Appropriations for the subsistence of members of the Army, 

Navy, Air Force, or Marine Corps are available for expenditures 

necessary in the operation, maintenance, and improvement of any 

plantation or farm, outside the United States and under the jurisdiction of the Army, Navy, Air Force, or Marine Corps, as the case 

may be, for furnishing fresh fruits and vegetables to the armed 

forces. However, no land may be acquired under this subsection. 

(b) Fruits and vegetables produced under subsection (a) that 

are over the amount furnished or sold to the armed forces or to civilians serving with the armed forces may be sold only outside the 

United States. 

(c) Of the persons employed by the United States under subsection (a), only nationals of the United States are entitled to the 

benefits provided by laws relating to the employment, work, compensation, or other benefits of civilian employees of the United 

States. 

(d) A plantation or farm covered by subsection (a) shall be operated, maintained, and improved by a private contractor or lessee, 

so far as practicable. Before using members of the Army, Navy, Air 

Force, or Marine Corps, as the case may be, the Secretary concerned must make a reasonable effort to make a contract or lease 

with a person in civil life for his services for that operation, maintenance, or improvement, on terms advantageous to the United 

States. A determination by the Secretary as to the reasonableness 

of effort to make a contract or lease, and as to the advantageous 

nature of its terms, is final. 

(Aug. 10, 1956, ch. 1041, 70A Stat. 138.) 

§ 2422. Bakery and dairy products: procurement outside the 

United States 

(a) The Secretary of Defense may authorize any element of the 

Department of Defense that procures bakery and dairy products for 

use by the armed forces outside the United States to procure any 

products described in subsection (b) through the use of procedures 

other than competitive procedures. 

(b) The products referred to in subsection (a) are bakery or 

dairy products produced by the Army and Air Force Exchange 
§ 2423 CH. 143—PRODUCTION BY MILITARY AGENCIES 1332 

Service in a facility outside the United States that began operating 

before July 1, 1986. 

(Added Pub. L. 99–661, div. A, title III, Sec. 312(a), Nov. 14, 1986, 100 Stat. 3851.) 

§ 2423. Laundry and dry cleaning services: procurement 

from facilities operated by the Navy Resale and 

Services Support Office 

(a) AUTHORITY.—The Secretary of Defense may authorize an 

element of the Department of Defense to enter into a contract 

(through the use of procedures other than competitive procedures) 

with a laundry and dry cleaning facility operated by the Navy Resale and Services Support Office to procure laundry and dry cleaning services for the armed forces outside the United States. 

(b) APPLICATION.—Subsection (a) shall apply only with respect 

to a laundry and dry cleaning facility of the Navy Resale and Services Support Office that began operating before October 1, 1989. 

(Added Pub. L. 101–189, div. A, title III, Sec. 323(a), Nov. 29, 1989, 103 Stat. 1414.) 

§ 2424. Procurement of supplies and services from exchange 

stores outside the United States 

(a) AUTHORITY.—The Secretary of Defense may authorize an 

element of the Department of Defense to enter into a contract 

(through the use of procedures other than competitive procedures) 

with an exchange store operated under the jurisdiction of the Secretary of a military department outside the United States to procure supplies or services for use by the armed forces outside the 

United States. 

(b) LIMITATIONS.—(1) A contract may not be entered into under 

subsection (a) in an amount in excess of $100,000. 

(2) Supplies provided under a contract entered into under subsection (a) shall be provided from the stocks of the exchange store 

on hand as of the date the contract is entered into with that exchange store. 

(3) A contract entered into with an exchange store under subsection (a) may not provide for the procurement of services not regularly provided by that exchange store. 

(c) EXCEPTION.—Paragraphs (1) and (2) of subsection (b) do not 

apply to contracts for the procurement of soft drinks that are manufactured in the United States. The Secretary of Defense shall prescribe in regulations the standards and procedures for determining 

whether a particular beverage is a soft drink and whether the beverage was manufactured in the United States. 

(Added Pub. L. 101–189, div. A, title III, Sec. 324(a), Nov. 29, 1989, 103 Stat. 1414; amended 

Pub. L. 103–355, title III, Sec. 3066, Oct. 13, 1994, 108 Stat. 3337; Pub. L. 104–106, div. D, 

title XLIII, Sec. 4321(b)(17), Feb. 10, 1996, 110 Stat. 673; Pub. L. 109–163, div. A, title VI, Sec. 

671, Jan. 6, 2006, 119 Stat. 3319.) 
1333 

CHAPTER 144—MAJOR DEFENSE ACQUISITION 

PROGRAMS 

Sec. 

2430. Major defense acquisition program defined. 

2430a. Major subprograms. 

2431. Weapons development and procurement schedules. 

2432. Selected Acquisition Reports. 

2433. Unit cost reports. 

2433a. Critical cost growth in major defense acquisition programs. 

2434. Independent cost estimates; operational manpower requirements. 

2435. Baseline description. 

2436. Major defense acquisition programs: incentive program for contractors to 

purchase capital assets manufactured in United States. 

2437. Development of major defense acquisition programs: sustainment of system to be replaced. 

2438. Performance assessments and root cause analyses. 

[2439. Repealed.] 

2440. Technology and industrial base plans. 

§ 2430. Major defense acquisition program defined 

(a) In this chapter, the term ‘‘major defense acquisition program’’ means a Department of Defense acquisition program that is 

not a highly sensitive classified program (as determined by the Secretary of Defense) and— 

(1) that is designated by the Secretary of Defense as a 

major defense acquisition program; or 

(2) that is estimated by the Secretary of Defense to require 

an eventual total expenditure for research, development, test, 

and evaluation of more than $300,000,000 (based on fiscal year 

1990 constant dollars) or an eventual total expenditure for procurement, including all planned increments or spirals, of more 

than $1,800,000,000 (based on fiscal year 1990 constant dollars). 

(b) The Secretary of Defense may adjust the amounts (and the 

base fiscal year) provided in subsection (a)(2) on the basis of Department of Defense escalation rates. An adjustment under this 

subsection shall be effective after the Secretary transmits a written 

notification of the adjustment to the Committee on Armed Services 

of the Senate and the Committee on Armed Services of the House 

of Representatives. 

(c) For purposes of subsection (a)(2), the Secretary shall consider, as applicable, the following: 

(1) The estimated level of resources required to fulfill the 

relevant joint military requirement, as determined by the Joint 

Requirements Oversight Council pursuant to section 181 of 

this title. 

(2) The cost estimate referred to in section 2366a(a)(4) of 

this title. 

(3) The cost estimate referred to in section 2366b(a)(1)(C) 

of this title. 
§ 2430a CH. 144—MAJOR DEFENSE ACQUISITION PROGRAMS 1334 

(4) The cost estimate within a baseline description as required by section 2435 of this title. 

(Added Pub. L. 100–26, Sec. 7(b)(2)(A), Apr. 21, 1987, 101 Stat. 279; amended Pub. L. 102–484, 

div. A, title VIII, Sec. 817(b), Oct. 23, 1992, 106 Stat. 2455; Pub. L. 104–106, div. A, title XV, 

Sec. 1502(a)(1), Feb. 10, 1996, 110 Stat. 502; Pub. L. 106–65, div. A, title X, Sec. 1067(1), Oct. 

5, 1999, 113 Stat. 774; Pub. L. 111–23, title II, Sec. 206(b), May 22, 2009, 123 Stat. 1728.) 

§ 2430a. Major subprograms 

(a) AUTHORITY TO DESIGNATE MAJOR SUBPROGRAMS AS SUB- JECT TO ACQUISITION REPORTING REQUIREMENTS.—(1) If the Secretary of Defense determines that a major defense acquisition program requires the delivery of two or more categories of end items 

which differ significantly from each other in form and function, the 

Secretary may designate each such category of end items as a 

major subprogram for the purposes of acquisition reporting under 

this chapter. 

(2) The Secretary shall notify the congressional defense committees in writing of any proposed designation pursuant to paragraph (1) not less than 30 days before the date such designation 

takes effect. 

(b) REPORTING REQUIREMENTS.—(1) If the Secretary designates 

a major subprogram of a major defense acquisition program in accordance with subsection (a), Selected Acquisition Reports, unit 

cost reports, and program baselines under this chapter shall reflect 

cost, schedule, and performance information— 

(A) for the major defense acquisition program as a whole 

(other than as provided in paragraph (2)); and 

(B) for each major subprogram of the major defense acquisition program so designated. 

(2) For a major defense acquisition program for which a designation of a major subprogram has been made under subsection 

(a), unit costs under this chapter shall be submitted in accordance 

with the definitions in subsection (d). 

(c) REQUIREMENT TO COVER ENTIRE MAJOR DEFENSE ACQUISI- TION PROGRAM.—If a subprogram of a major defense acquisition 

program is designated as a major subprogram under subsection (a), 

all other elements of the major defense acquisition program shall 

be appropriately organized into one or more subprograms under the 

major defense acquisition program, each of which subprograms, as 

so organized, shall be treated as a major subprogram under subsection (a). 

(d) DEFINITIONS.—Notwithstanding paragraphs (1) and (2) of 

section 2432(a) of this title, in the case of a major defense acquisition program for which the Secretary has designated one or more 

major subprograms under this section for the purposes of this chapter— 

(1) the term ‘‘program acquisition unit cost’’ applies at the 

level of the subprogram and means the total cost for the development and procurement of, and specific military construction 

for, the major defense acquisition program that is reasonably 

allocable to each such major subprogram, divided by the relevant number of fully-configured end items to be produced 

under such major subprogram; 

(2) the term ‘‘procurement unit cost’’ applies at the level of 

the subprogram and means the total of all funds programmed 
1335 § 2431 CH. 144—MAJOR DEFENSE ACQUISITION PROGRAMS 

to be available for obligation for procurement for each such 

major subprogram, divided by the number of fully-configured 

end items to be procured under such major subprogram; 

(3) the term ‘‘major contract’’, with respect to a designated 

major subprogram, means each of the six largest prime, associate, or Government furnished equipment contracts under the 

subprogram that is in excess of $40,000,000 and that is not a 

firm-fixed price contract; and 

(4) the term ‘‘life cycle cost’’, with respect to a designated 

major subprogram, means all costs of development, procurement, military construction, and operations and support, without regard to funding source or management control. 

(Added Pub. L. 110–417, [div. A], title VIII, Sec. 811(a)(1), Oct. 14, 2008, 122 Stat. 4520; amended Pub. L. 111–383, div. A, title VIII, Sec. 814(a), Jan. 7, 2011, 124 Stat. 4266.) 

§ 2431. Weapons development and procurement schedules 

(a) The Secretary of Defense shall submit to Congress each calendar year, not later than 45 days after the President submits the 

budget to Congress under section 1105 of title 31, budget justification documents regarding development and procurement schedules 

for each weapon system for which fund authorization is required by 

section 114(a) of this title, and for which any funds for procurement 

are requested in that budget. The documents shall include data on 

operational testing and evaluation for each weapon system for 

which funds for procurement are requested (other than funds requested only for the procurement of units for operational testing 

and evaluation, or long lead-time items, or both). A weapon system 

shall also be included in the annual documents required under this 

subsection in each year thereafter until procurement of that system 

has been completed or terminated, or the Secretary of Defense certifies, in writing, that such inclusion would not serve any useful 

purpose and gives his reasons therefor. 

(b) Any documents required to be submitted under subsection 

(a) shall include detailed and summarized information with respect 

to each weapon system covered and shall specifically include each 

of the following: 

(1) The development schedule, including estimated annual 

costs until development is completed. 

(2) The planned procurement schedule, including the best 

estimate of the Secretary of Defense of the annual costs and 

units to be procured until procurement is completed. 

(3) To the extent required by the second sentence of subsection (a), the result of all operational testing and evaluation 

up to the time of the submission of the documents, or, if operational testing and evaluation has not been conducted, a statement of the reasons therefor and the results of such other testing and evaluation as has been conducted. 

(4)(A) The most efficient production rate, the most efficient 

acquisition rate, and the minimum sustaining rate, consistent 

with the program priority established for such weapon system 

by the Secretary concerned. 

(B) In this paragraph: 

(i) The term ‘‘most efficient production rate’’ means the 

maximum rate for each budget year at which the weapon 
§ 2432 CH. 144—MAJOR DEFENSE ACQUISITION PROGRAMS 1336 

system can be produced with existing or planned plant capacity and tooling, with one shift a day running for eight 

hours a day and five days a week. 

(ii) The term ‘‘minimum sustaining rate’’ means the 

production rate for each budget year that is necessary to 

keep production lines open while maintaining a base of responsive vendors and suppliers. 

(c) In the case of any weapon system for which procurement 

funds have not been previously requested and for which funds are 

first requested by the President in any fiscal year after the Budget 

for that fiscal year has been submitted to Congress, the same documentation requirements shall be applicable to that system in the 

same manner and to the same extent as if funds had been requested for that system in that budget. 

(Added Pub. L. 93–155, title VIII, Sec. 803(a), Nov. 16, 1973, 87 Stat. 614, Sec. 139; amended 

Pub. L. 94–106, title VIII, Sec. 805, Oct. 7, 1975, 89 Stat. 538; Pub. L. 96–513, title V, Sec. 

511(5), Dec. 12, 1980, 94 Stat. 2920; Pub. L. 97–86, title IX, Sec. 909(c), Dec. 1, 1981, 95 Stat. 

1120; Pub. L. 97–258, Sec. 3(b)(1), Sept. 13, 1982, 96 Stat. 1063; Pub. L. 98–525, title XIV, Sec. 

1405(3), Oct. 19, 1984, 98 Stat. 2621; renumbered Sec. 2431 and amended Pub. L. 99–433, title 

I, Sec. 101(a)(5), 110(d)(12), (g)(6), Oct. 1, 1986, 100 Stat. 995, 1003, 1004; Pub. L. 100–180, div. 

A, title XIII, Sec. 1314(a)(1), Dec. 4, 1987, 101 Stat. 1175; Pub. L. 101–510, div. A, title XIII, 

Sec. 1301(13), title XIV, Sec. 1484(f)(3), Nov. 5, 1990, 104 Stat. 1668, 1717; Pub. L. 103–355, 

title III, Sec. 3001, Oct. 13, 1994, 108 Stat. 3327; Pub. L. 104–106, div. D, title XLIII, Sec. 

4321(b)(18), Feb. 10, 1996, 110 Stat. 673.) 

§ 2432. Selected Acquisition Reports 

(a) In this section: 

(1) The term ‘‘program acquisition unit cost’’, with respect 

to a major defense acquisition program, means the amount 

equal to (A) the total cost for development and procurement of, 

and system-specific military construction for, the acquisition 

program, divided by (B) the number of fully-configured end 

items to be produced for the acquisition program. 

(2) The term ‘‘procurement unit cost’’, with respect to a 

major defense acquisition program, means the amount equal to 

(A) the total of all funds programmed to be available for obligation for procurement for the program, divided by (B) the number of fully-configured end items to be procured. 

(3) The term ‘‘major contract’’, with respect to a major defense acquisition program, means each of the six largest prime, 

associate, or Government-furnished equipment contracts under 

the program that is in excess of $40,000,000 and that is not a 

firm, fixed price contract. 

(4) The term ‘‘full life-cycle cost’’, with respect to a major 

defense acquisition program, means all costs of development, 

procurement, military construction, and operations and support, without regard to funding source or management control. 

(b)(1) The Secretary of Defense shall submit to Congress at the 

end of each fiscal-year quarter a report on current major defense 

acquisition programs. Except as provided in paragraphs (2) and (3), 

each such report shall include a status report on each defense acquisition program that at the end of such quarter is a major defense acquisition program. Reports under this section shall be 

known as Selected Acquisition Reports. 

(2) A status report on a major defense acquisition program 

need not be included in the Selected Acquisition Report for the sec-
1337 § 2432 CH. 144—MAJOR DEFENSE ACQUISITION PROGRAMS 

ond, third, or fourth quarter of a fiscal year if such a report was 

included in a previous Selected Acquisition Report for that fiscal 

year and during the period since that report there has been— 

(A) less than a 15 percent increase in program acquisition 

unit cost and current procurement unit cost for the program 

(or for each designated subprogram under the program); and 

(B) less than a six-month delay in any program schedule 

milestone shown in the Selected Acquisition Report. 

(3)(A) The Secretary of Defense may waive the requirement for 

submission of Selected Acquisition Reports for a program for a fiscal year if— 

(i) the program has not entered system development and 

demonstration; 

(ii) a reasonable cost estimate has not been established for 

such program; and 

(iii) the system configuration for such program is not well 

defined. 

(B) The Secretary shall submit to the Committee on Armed 

Services of the Senate and the Committee on Armed Services of the 

House of Representatives a written notification of each waiver 

under subparagraph (A) for a program for a fiscal year not later 

than 60 days before the President submits the budget to Congress 

pursuant to section 1105 of title 31 in that fiscal year. 

(c)(1) Each Selected Acquisition Report for the first quarter for 

a fiscal year shall include— 

(A) the same information, in detailed and summarized 

form, as is provided in reports submitted under section 2431 

of this title; 

(B) the current program acquisition unit cost for each 

major defense acquisition program or designated major subprogram included in the report and the history of that cost from 

the date the program or subprogram was first included in a Selected Acquisition Report to the end of the quarter for which 

the current report is submitted; 

(C) the current procurement unit cost for each major defense acquisition program or designated major subprogram included in the report and the history of that cost from the date 

the program or subprogram was first included in a Selected Acquisition Report to the end of the quarter for which the current 

report is submitted; and 

(D) such other information as the Secretary of Defense 

considers appropriate. 

(2) Each Selected Acquisition Report for the first quarter of a 

fiscal year shall be designed to provide to the Committee on Armed 

Services of the Senate and the Committee on Armed Services the 

information such Committees need to perform their oversight functions. Whenever the Secretary of Defense proposes to make 

changes in the content of a Selected Acquisition Report, the Secretary shall submit a notice of the proposed changes to such committees. The changes shall be considered approved by the Secretary, and may be incorporated into the report, only after the end 

of the 60-day period beginning on the date on which the notice is 

received by those committees. 
§ 2432 CH. 144—MAJOR DEFENSE ACQUISITION PROGRAMS 1338 

(3) In addition to the material required by paragraphs (1) and 

(2), each Selected Acquisition Report for the first quarter of a fiscal 

year shall include the following: 

(A) A full life-cycle cost analysis for each major defense acquisition program and each designated major subprogram included in the report that is in the system development and 

demonstration stage or has completed that stage. The Secretary of Defense shall ensure that this subparagraph is implemented in a uniform manner, to the extent practicable, 

throughout the Department of Defense. 

(B) If the system that is included in that major defense acquisition program has an antecedent system, a full life-cycle 

cost analysis for that system. 

(4) Selected Acquisition Reports for the first quarter of a fiscal 

year shall be known as comprehensive annual Selected Acquisition 

Reports. 

(d)(1) Each Selected Acquisition Report for the second, third, 

and fourth quarters of a fiscal year shall include— 

(A) with respect to each major defense acquisition program 

that was included in the most recent comprehensive annual 

Selected Acquisition Report, the information described in subsection (e); and 

(B) with respect to each major defense acquisition program 

that was not included in the most recent comprehensive annual Selected Acquisition Report, the information described in 

subsection (c). 

(2) Selected Acquisition Reports for the second, third, and 

fourth quarters of a fiscal year shall be known as Quarterly Selected Acquisition Reports. 

(e) Information to be included under this subsection in a Quarterly Selected Acquisition Report with respect to a major defense 

acquisition program is as follows: 

(1) The quantity of items to be purchased under the program. 

(2) The program acquisition cost. 

(3) The program acquisition unit cost for the program (or 

for each designated major subprogram under the program). 

(4) The current procurement cost for the program. 

(5) The current procurement unit cost for the program (or 

for each designated major subprogram under the program). 

(6) The reasons for any change in program acquisition cost, 

program acquisition unit cost, procurement cost, or procurement unit cost or in program schedule from the previous Selected Acquisition Report. 

(7) The reasons for any significant changes (from the previous Selected Acquisition Report) in the total program cost for 

development and procurement of the software component of 

the program or subprogram, schedule milestones for the software component of the program or subprogram, or expected 

performance for the software component of the program or subprogram that are known, expected, or anticipated by the program manager. 

(8) The major contracts under the program and designated 

major subprograms under the program and the reasons for any 
1339 § 2432 CH. 144—MAJOR DEFENSE ACQUISITION PROGRAMS 

cost or schedule variances under those contracts since the last 

Selected Acquisition Report. 

(9) Program highlights since the last Selected Acquisition 

Report. 

(f) Each comprehensive annual Selected Acquisition Report 

shall be submitted within 60 days after the date on which the 

President transmits the Budget to Congress for the following fiscal 

year, and each Quarterly Selected Acquisition Report shall be submitted within 45 days after the end of the fiscal-year quarter. 

(g) The requirements of this section with respect to a major defense acquisition program or designated major subprogram shall 

cease to apply after 90 percent of the items to be delivered to the 

United States under the program or subprogram (shown as the 

total quantity of items to be purchased under the program or subprogram in the most recent Selected Acquisition Report) have been 

delivered or 90 percent of planned expenditures under the program 

or subprogram have been made. 

(h)(1) Total program reporting under this section shall apply to 

a major defense acquisition program when funds have been appropriated for such program and the Secretary of Defense has decided 

to proceed to system development and demonstration of such program. Reporting may be limited to the development program as 

provided in paragraph (2) before a decision is made by the Secretary of Defense to proceed to system development and demonstration if the Secretary notifies the Committee on armed Services of 

the Senate and the Committee on Armed Services of the intention 

to submit a limited report under this subsection not less than 15 

days before a report is due under this section. 

(2) A limited report under this subsection shall include the following: 

(A) The same information, in detail and summarized form, 

as is provided in reports submitted under subsections (b)(1) 

and (b)(3) of section 2431 of this title. 

(B) Reasons for any change in the development cost and 

schedule. 

(C) The major contracts under the development program 

and designated major subprograms under the program and the 

reasons for any cost or schedule variances under those contracts since the last Selected Acquisition Report. 

(D) Program highlights since the last Selected Acquisition 

Report. 

(E) Other information as the Secretary of Defense considers appropriate. 

(3) The submission requirements for a limited report under 

this subsection shall be the same as for quarterly Selected Acquisition Reports for total program reporting. 

(Added Pub. L. 97–252, title XI, Sec. 1107(a)(1), Sept. 8, 1982, 96 Stat. 739, Sec. 139a; amended 

Pub. L. 98–525, title XII, Sec. 1242(a), Oct. 19, 1984, 98 Stat. 2606; Pub. L. 99–145, title XII, 

Sec. 1201, Nov. 8, 1985, 99 Stat. 715; renumbered Sec. 2432 and amended Pub. L. 99–433, title 

I, Sec. 101(a)(5), 110(d)(13), (g)(7), Oct. 1, 1986, 100 Stat. 995, 1003, 1004; Pub. L. 99–500, Sec. 

101(c) [title X, Sec. 961(a)], Oct. 18, 1986, 100 Stat. 1783–82, 1783–175, and Pub. L. 99–591, 

Sec. 101(c) [title X, Sec. 961(a)], Oct. 30, 1986, 100 Stat. 3341–82, 3341–175; Pub. L. 99–661, 

div. A, title IX, formerly title IV, Sec. 961(a), Nov. 14, 1986, 100 Stat. 3955, renumbered title 

IX, Pub. L. 100–26, Sec. 3(5), Apr. 21, 1987, 101 Stat. 273; Pub. L. 100–26, Sec. 7(b)(3), (k)(2), 

Apr. 21, 1987, 101 Stat. 279, 284; Pub. L. 100–180, div. A, title XII, Sec. 1233(a)(1), title XIII, 

Sec. 1314(a)(1), Dec. 4, 1987, 101 Stat. 1161, 1175; Pub. L. 101–189, div. A, title VIII, Sec. 

811(c), Nov. 29, 1989, 103 Stat. 1493; Pub. L. 101–510, div. A, title XIV, Sec. 1407(a)–(c), 
§ 2433 CH. 144—MAJOR DEFENSE ACQUISITION PROGRAMS 1340 

1484(f)(4), Nov. 5, 1990, 104 Stat. 1681, 1717; Pub. L. 102–25, title VII, Sec. 701(f)(3), Apr. 6, 

1991, 105 Stat. 115; Pub. L. 102–190, div. A, title VIII, Sec. 801(b)(2), title X, Sec. 1061(a)(14), 

Dec. 5, 1991, 105 Stat. 1412, 1473; Pub. L. 102–484, div. A, title VIII, Sec. 817(c), Oct. 23, 1992, 

106 Stat. 2455; Pub. L. 103–355, title III, Sec. 3002(a)(1), (b)–(h), Oct. 13, 1994, 108 Stat. 3328, 

3329; Pub. L. 104–106, div. A, title XV, Sec. 1502(a)(1), Feb. 10, 1996, 110 Stat. 502; Pub. L. 

104–201, div. A, title VIII, Sec. 806, Sept. 23, 1996, 110 Stat. 2606; Pub. L. 105–85, div. A, title 

VIII, Sec. 841(c), Nov. 18, 1997, 111 Stat. 1843; Pub. L. 106–65, div. A, title X, Sec. 1067(1), 

Oct. 5, 1999, 113 Stat. 774; Pub. L. 107–107, div. A, title VIII, Sec. 821(a), Dec. 28, 2001, 115 

Stat. 1181; Pub. L. 108–136, div. A, title X, Sec. 1045(a)(6), Nov. 24, 2003, 117 Stat. 1612; Pub. 

L. 108–375, div. A, title VIII, Sec. 801(b)(2), Oct. 28, 2004, 118 Stat. 2004; Pub. L. 109–364, 

div. A, title X, Sec. 1071(g)(10), Oct. 17, 2006, 120 Stat. 2402; Pub. L. 110–417, [div. A], title 

VIII, Sec. 811(b), Oct. 14, 2008, 122 Stat. 4521.) 

§ 2433. Unit cost reports 

(a) In this section: 

(1) Except as provided in section 2430a(d) of this title, the 

terms ‘‘program acquisition unit cost’’, ‘‘procurement unit cost’’, 

and ‘‘major contract’’ have the same meanings as provided in 

section 2432(a) of this title. 

(2) The term ‘‘Baseline Estimate’’, with respect to a unit 

cost report that is submitted under this section to the service 

acquisition executive designated by the Secretary concerned on 

a major defense acquisition program or designated major subprogram, means the cost estimate included in the baseline description for the program or subprogram under section 2435 of 

this title. 

(3) The term ‘‘procurement program’’ means a program for 

which funds for procurement are authorized to be appropriated 

in a fiscal year. 

(4) The term ‘‘significant cost growth threshold’’ means the 

following: 

(A) In the case of a major defense acquisition program 

or designated major defense subprogram, a percentage increase in the program acquisition unit cost for the program 

or subprogram of— 

(i) at least 15 percent over the program acquisition unit cost for the program or subprogram as shown 

in the current Baseline Estimate for the program; or 

(ii) at least 30 percent over the program acquisition unit cost for the program or subprogram as shown 

in the original Baseline Estimate for the program or 

subprogram. 

(B) In the case of a major defense acquisition program 

or designated major defense subprogram that is a procurement program, a percentage increase in the procurement 

unit cost for the program or subprogram of— 

(i) at least 15 percent over the procurement unit 

cost for the program or subprogram as shown in the 

current Baseline Estimate for the program or subprogram; or 

(ii) at least 30 percent over the procurement unit 

cost for the program or subprogram as shown in the 

original Baseline Estimate for the program. 

(5) The term ‘‘critical cost growth threshold’’ means the following: 

(A) In the case of a major defense acquisition program 

or designated major defense subprogram, a percentage in-
1341 § 2433 CH. 144—MAJOR DEFENSE ACQUISITION PROGRAMS 

crease in the program acquisition unit cost for the program 

or subprogram of— 

(i) at least 25 percent over the program acquisition unit cost for the program or subprogram as shown 

in the current Baseline Estimate for the program or 

subprogram; or 

(ii) at least 50 percent over the program acquisition unit cost for the program or subprogram as shown 

in the original Baseline Estimate for the program or 

subprogram. 

(B) In the case of a major defense acquisition program 

or designated major defense subprogram that is a procurement program, a percentage increase in the procurement 

unit cost for the program or subprogram of— 

(i) at least 25 percent over the procurement unit 

cost for the program as shown in the current Baseline 

Estimate for the program or subprogram; or 

(ii) at least 50 percent over the procurement unit 

cost for the program or subprogram as shown in the 

original Baseline Estimate for the program or subprogram. 

(6) The term ‘‘original Baseline Estimate’’ has the same 

meaning as provided in section 2435(d) of this title. 

(b) The program manager for a major defense acquisition program (other than a program not required to be included in the Selected Acquisition Report for that quarter under section 2432(b)(3) 

of this title) shall, on a quarterly basis, submit to the service acquisition executive designated by the Secretary concerned a written 

report on the unit costs of the program (or of each designated major 

subprogram under the program). Each report shall be submitted 

not more than 30 calendar days after the end of that quarter. The 

program manager shall include in each such unit cost report the 

following information with respect to the program (as of the last 

day of the quarter for which the report is made): 

(1) The program acquisition unit cost for the program (or 

for each designated major subprogram under the program). 

(2) In the case of a procurement program, the procurement 

unit cost for the program (or for each designated major subprogram under the program). 

(3) Any cost variance or schedule variance in a major contract under the program since the contract was entered into. 

(4) Any changes from program schedule milestones or program performances reflected in the baseline description established under section 2435 of this title that are known, expected, or anticipated by the program manager. 

(5) Any significant changes in the total program cost for 

development and procurement of the software component of 

the program or subprogram, schedule milestones for the software component of the program or subprogram, or expected 

performance for the software component of the program or subprogram that are known, expected, or anticipated by the program manager. 

(c) If the program manager of a major defense acquisition program for which a unit cost report has previously been submitted 
§ 2433 CH. 144—MAJOR DEFENSE ACQUISITION PROGRAMS 1342 

under subsection (b) determines at any time during a quarter that 

there is reasonable cause to believe that the program acquisition 

unit cost for the program (or for a designated major subprogram 

under the program) or the procurement unit cost for the program 

(or for such a subprogram), as applicable, has increased by a percentage equal to or greater than the significant cost growth threshold; and if a unit cost report indicating an increase of such percentage or more has not previously been submitted to the service acquisition executive designated by the Secretary concerned, then the 

program manager shall immediately submit to such service acquisition executive a unit cost report containing the information, determined as of the date of the report, required under subsection (b). 

(d)(1) When a unit cost report is submitted to the service acquisition executive designated by the Secretary concerned under this 

section with respect to a major defense acquisition program or any 

designated major subprogram under the program, the service acquisition executive shall determine whether the current program 

acquisition unit cost for the program or subprogram has increased 

by at least 15 percent, or by a percentage equal to or greater than 

the significant cost growth threshold, or the critical cost growth 

threshold, for the program or subprogram. 

(2) When a unit cost report is submitted to the service acquisition executive designated by the Secretary concerned under this 

section with respect to a major defense acquisition program or any 

designated major subprogram under the program that is a procurement program, the service acquisition executive, in addition to the 

determination under paragraph (1), shall determine whether the 

procurement unit cost for the program or subprogram has increased by a percentage equal to or greater than the significant 

cost growth threshold, or the critical cost growth threshold, for the 

program or subprogram. 

(3) If, based upon the service acquisition executive’s determination, the Secretary concerned determines that the current program 

acquisition unit cost has increased by a percentage equal to or 

greater than the significant cost growth threshold or critical cost 

growth threshold or that the procurement unit cost has increased 

by a percentage equal to or greater than the significant cost growth 

threshold or critical cost growth threshold, the Secretary shall notify Congress in writing of such determination and of the increase 

with respect to the program or subprogram concerned. In the case 

of a determination based on a quarterly report submitted in accordance with subsection (b), the Secretary shall submit the notification 

to Congress within 45 days after the end of the quarter. In the case 

of a determination based on a report submitted in accordance with 

subsection (c), the Secretary shall submit the notification to Congress within 45 days after the date of that report. The Secretary 

shall include in the notification the date on which the determination was made. 

(e)(1)(A) Except as provided in subparagraph (B), whenever the 

Secretary concerned determines under subsection (d) that the program acquisition unit cost or the procurement unit cost of a major 

defense acquisition program or designated major subprogram has 

increased by a percentage equal to or greater than the significant 

cost growth threshold for the program or subprogram, a Selected 
1343 § 2433 CH. 144—MAJOR DEFENSE ACQUISITION PROGRAMS 

Acquisition Report shall be submitted to Congress for the first fiscal-year quarter ending on or after the date of the determination 

or for the fiscal-year quarter which immediately precedes the first 

fiscal-year quarter ending on or after that date. The report shall include the information described in section 2432(e) of this title and 

shall be submitted in accordance with section 2432(f) of this title. 

(B) Whenever the Secretary makes a determination referred to 

in subparagraph (A) in the case of a major defense acquisition program or designated major subprogram during the second quarter of 

a fiscal year and before the date on which the President transmits 

the budget for the following fiscal year to Congress pursuant to section 1105 of title 31, the Secretary is not required to file a Selected 

Acquisition Report under subparagraph (A) but shall include the 

information described in subsection (g) regarding that program or 

subprogram in the comprehensive annual Selected Acquisition Report submitted in that quarter. 

(2) If the program acquisition unit cost or procurement unit 

cost of a major defense acquisition program or designated major 

subprogram (as determined by the Secretary under subsection (d)) 

increases by a percentage equal to or greater than the critical cost 

growth threshold for the program or subprogram, the Secretary of 

Defense shall take actions consistent with the requirements of section 2433a of this title. 

(3) If a determination of an increase by a percentage equal to 

or greater than the significant cost growth threshold is made by 

the Secretary under subsection (d) and a Selected Acquisition Report containing the information described in subsection (g) is not 

submitted to Congress under paragraph (1), or if a determination 

of an increase by a percentage equal to or greater than the critical 

cost growth threshold is made by the Secretary under subsection 

(d) and the certification of the Secretary of Defense is not submitted to Congress under paragraph (2), funds appropriated for 

military construction, for research, development, test, and evaluation, and for procurement may not be obligated for a major contract 

under the program. The prohibition on the obligation of funds for 

a major defense acquisition program shall cease to apply at the end 

of a period of 30 days of continuous session of Congress (as determined under section 7307(b)(2) of this title) beginning on the 

date— 

(A) on which Congress receives the Selected Acquisition 

Report under paragraph (1) or (2)(B) with respect to that program, in the case of a determination of an increase by a percentage equal to or greater than the significant cost growth 

threshold (as determined in subsection (d)); or 

(B) on which Congress has received both the Selected Acquisition Report under paragraph (1) or (2)(B) and the certification of the Secretary of Defense under paragraph (2)(A) with 

respect to that program, in the case of an increase by a percentage equal to or greater than the critical cost growth 

threshold (as determined under subsection (d)). 

(f) Any determination of a percentage increase under this section shall be stated in terms of constant base year dollars (as described in section 2430 of this title). 
§ 2433 CH. 144—MAJOR DEFENSE ACQUISITION PROGRAMS 1344 

(g)(1) Except as provided in paragraph (2), each report under 

subsection (e) with respect to a major defense acquisition program 

shall include the following: 

(A) The name of the major defense acquisition program. 

(B) The date of the preparation of the report. 

(C) The program phase as of the date of the preparation 

of the report. 

(D) The estimate of the program acquisition cost for the 

program (and for each designated major subprogram under the 

program) as shown in the Selected Acquisition Report in which 

the program or subprogram was first included, expressed in 

constant base-year dollars and in current dollars. 

(E) The current program acquisition cost for the program 

(and for each designated major subprogram under the program) in constant base-year dollars and in current dollars. 

(F) A statement of the reasons for any increase in program 

acquisition unit cost or procurement unit cost for the program 

(or for any designated major subprogram under the program). 

(G) The completion status of the program and each designated major subprogram under the program (i) expressed as 

the percentage that the number of years for which funds have 

been appropriated for the program or subprogram is of the 

number of years for which it is planned that funds will be appropriated for the program or subprogram, and (ii) expressed 

as the percentage that the amount of funds that have been appropriated for the program or subprogram is of the total 

amount of funds which it is planned will be appropriated for 

the program or subprogram. 

(H) The fiscal year in which information on the program 

and each designated major subprogram under the program was 

first included in a Selected Acquisition Report (referred to in 

this paragraph as the ‘‘base year’’) and the date of that Selected Acquisition Report in which information on the program 

or subprogram was first included. 

(I) The type of the Baseline Estimate that was included in 

the baseline description under section 2435 of this title and the 

date of the Baseline Estimate. 

(J) The current change and the total change, in dollars and 

expressed as a percentage, in the program acquisition unit cost 

for the program (or for each designated major subprogram 

under the program), stated both in constant base-year dollars 

and in current dollars. 

(K) The current change and the total change, in dollars 

and expressed as a percentage, in the procurement unit cost 

for the program (or for each designated major subprogram 

under the program), stated both in constant base-year dollars 

and in current dollars and the procurement unit cost for the 

program (or for each designated major subprogram under the 

program) for the succeeding fiscal year expressed in constant 

base-year dollars and in current year dollars. 

(L) The quantity of end items to be acquired under the 

program and the current change and total change, if any, in 

that quantity. 
1345 § 2433 CH. 144—MAJOR DEFENSE ACQUISITION PROGRAMS 

(M) The identities of the military and civilian officers responsible for program management and cost control of the program. 

(N) The action taken and proposed to be taken to control 

future cost growth of the program. 

(O) Any changes made in the performance or schedule 

milestones of the program and the extent to which such 

changes have contributed to the increase in program acquisition unit cost or procurement unit cost for the program (or for 

any designated major subprogram under the program). 

(P) The following contract performance assessment information with respect to each major contract under the program 

or subprogram: 

(i) The name of the contractor. 

(ii) The phase that the contract is in at the time of the 

preparation of the report. 

(iii) The percentage of work under the contract that 

has been completed. 

(iv) Any current change and the total change, in dollars and expressed as a percentage, in the contract cost. 

(v) The percentage by which the contract is currently 

ahead of or behind schedule. 

(vi) A narrative providing a summary explanation of 

the most significant occurrences, including cost and schedule variances under major contracts of the program and 

any designated major subprogram under the program, contributing to the changes identified and a discussion of the 

effect these occurrences will have on future program costs 

and the program schedule. 

(Q) In any case in which one or more problems with the 

software component of the program or any designated major 

subprogram under the program significantly contributed to the 

increase in program unit costs, the action taken and proposed 

to be taken to solve such problems. 

(2) If a program acquisition unit cost increase or a procurement 

unit cost increase for a major defense acquisition program or designated major subprogram that results in a report under this subsection is due to termination or cancellation of the entire program 

or subprogram, only the information specified in clauses (A) 

through (F) of paragraph (1) and the percentage change in program 

acquisition unit cost or procurement unit cost that resulted in the 

report need be included in the report. The certification of the Secretary of Defense under subsection (e) is not required to be submitted for termination or cancellation of a program or subprogram. 

(h) Reporting under this section shall not apply if a program 

has received a limited reporting waiver under section 2432(h) of 

this title. 

(Added Pub. L. 97–252, title XI, Sec. 1107(a)(1), Sept. 8, 1982, 96 Stat. 741, Sec. 139b; amended 

Pub. L. 98–94, title XII, Sec. 1268(1), Sept. 24, 1983, 97 Stat. 705; Pub. L. 98–525, title XII, 

Sec. 1242(b), Oct. 19, 1984, 98 Stat. 2607; Pub. L. 99–145, title XIII, Sec. 1303(a)(2), Nov. 8, 

1985, 99 Stat. 738; renumbered Sec. 2433 and amended Pub. L. 99–433, title I, Sec. 101(a)(5), 

110(d)(14), (g)(8), Oct. 1, 1986, 100 Stat. 995, 1003, 1004; Pub. L. 99–500, Sec. 101(c) [title X, 

Sec. 961(b)], Oct. 18, 1986, 100 Stat. 1783–82, 1783–176, and Pub. L. 99–591, Sec. 101(c) [title 

X, Sec. 961(b)], Oct. 30, 1986, 100 Stat. 3341–82, 3341–176; Pub. L. 99–661, div. A, title IX, 

formerly title IV, Sec. 961(b), Nov. 14, 1986, 100 Stat. 3956, renumbered title IX, Pub. L. 100– 

26, Sec. 3(5), Apr. 21, 1987, 101 Stat. 273; Pub. L. 100–26, Sec. 7(b)(4), (k)(7), Apr. 21, 1987, 
§ 2433a CH. 144—MAJOR DEFENSE ACQUISITION PROGRAMS 1346 

101 Stat. 279, 284; Pub. L. 100–180, div. A, title XIII, Sec. 1314(a)(1), Dec. 4, 1987, 101 Stat. 

1175; Pub. L. 101–189, div. A, title VIII, Sec. 811(a), Nov. 29, 1989, 103 Stat. 1490; Pub. L. 

101–510, div. A, title XIV, Sec. 1484(k)(10), Nov. 5, 1990, 104 Stat. 1719; Pub. L. 102–484, div. 

A, title VIII, Sec. 817(d), Oct. 23, 1992, 106 Stat. 2456; Pub. L. 103–35, title II, Sec. 201(i)(2), 

May 31, 1993, 107 Stat. 100; Pub. L. 103–355, title III, Sec. 3002(a)(2), 3003, Oct. 13, 1994, 108 

Stat. 3328, 3329; Pub. L. 105–85, div. A, title VIII, Sec. 833, Nov. 18, 1997, 111 Stat. 1842; Pub. 

L. 108–375, div. A, title VIII, Sec. 801(a), (b)(1), Oct. 28, 2004, 118 Stat. 2004; Pub. L. 109– 

163, div. A, title VIII, Sec. 802(a)–(c), (d)(2), Jan. 6, 2006, 119 Stat. 3367–3370; Pub. L. 109– 

364, div. A, title II, Sec. 213(a), Oct. 17, 2006, 120 Stat. 2121; Pub. L. 110–181, div. A, title 

IX, Sec. 942(e), Jan. 28, 2008, 122 Stat. 288; Pub. L. 110–417, [div. A], title VIII, Sec. 811(c), 

Oct. 14, 2008, 122 Stat. 4522; Pub. L. 111–23, title II, Sec. 206(a)(3), May 22, 2009, 123 Stat. 

1728; Pub. L. 111–84, div. A, title X, Sec. 1073(c)(4), Oct. 28, 2009, 123 Stat. 2474; Pub. L. 111– 

383, div. A, title X, Sec. 1075(b)(34), Jan. 7, 2011, 124 Stat. 4371.) 

§ 2433a. Critical cost growth in major defense acquisition 

programs 

(a) REASSESSMENT OF PROGRAM.—If the program acquisition 

unit cost or procurement unit cost of a major defense acquisition 

program or designated subprogram (as determined by the Secretary under section 2433(d) of this title) increases by a percentage 

equal to or greater than the critical cost growth threshold for the 

program or subprogram, the Secretary of Defense, after consultation with the Joint Requirements Oversight Council regarding program requirements, shall— 

(1) determine the root cause or causes of the critical cost 

growth in accordance with applicable statutory requirements 

and Department of Defense policies, procedures, and guidance; 

and 

(2) in consultation with the Director of Cost Assessment 

and Program Evaluation, carry out an assessment of— 

(A) the projected cost of completing the program if current requirements are not modified; 

(B) the projected cost of completing the program based 

on reasonable modification of such requirements; 

(C) the rough order of magnitude of the costs of any 

reasonable alternative system or capability; and 

(D) the need to reduce funding for other programs due 

to the growth in cost of the program. 

(b) PRESUMPTION OF TERMINATION.—(1) After conducting the 

reassessment required by subsection (a) with respect to a major defense acquisition program, the Secretary shall terminate the program unless the Secretary submits to Congress, before the end of 

the 60-day period beginning on the day the Selected Acquisition 

Report containing the information described in section 2433(g) of 

this title is required to be submitted under section 2432(f) of this 

title, a written certification in accordance with paragraph (2). 

(2) A certification described by this paragraph with respect to 

a major defense acquisition program is a written certification 

that— 

(A) the continuation of the program is essential to the national security; 

(B) there are no alternatives to the program which will 

provide acceptable capability to meet the joint military requirement (as defined in section 181(g)(1) of this title) at less cost; 

(C) the new estimates of the program acquisition unit cost 

or procurement unit cost have been determined by the Director 

of Cost Assessment and Program Evaluation to be reasonable; 
1347 § 2433a CH. 144—MAJOR DEFENSE ACQUISITION PROGRAMS 

(D) the program is a higher priority than programs whose 

funding must be reduced to accommodate the growth in cost of 

the program; and 

(E) the management structure for the program is adequate 

to manage and control program acquisition unit cost or procurement unit cost. 

(3) A written certification under paragraph (2) shall be accompanied by a report presenting the root cause analysis and assessment carried out pursuant to subsection (a) and the basis for each 

determination made in accordance with subparagraphs (A) through 

(E) of paragraph (2), together with supporting documentation. 

(c) ACTIONS IF PROGRAM NOT TERMINATED.—(1) If the Secretary elects not to terminate a major defense acquisition program 

pursuant to subsection (b), the Secretary shall— 

(A) restructure the program in a manner that addresses 

the root cause or causes of the critical cost growth, as identified pursuant to subsection (a), and ensures that the program 

has an appropriate management structure as set forth in the 

certification submitted pursuant to subsection (b)(2)(E); 

(B) rescind the most recent Milestone approval, or Key Decision Point approval in the case of a space program, for the 

program and withdraw any associated certification under section 2366a or 2366b of this title; 

(C) require a new Milestone approval, or Key Decision 

Point approval in the case of a space program, for the program 

before taking any contract action to enter a new contract, exercise an option under an existing contract, or otherwise extend 

the scope of an existing contract under the program, except to 

the extent determined necessary by the Milestone Decision Authority, on a non-delegable basis, to ensure that the program 

can be restructured as intended by the Secretary without unnecessarily wasting resources; 

(D) include in the report specified in paragraph (2) a description of all funding changes made as a result of the growth 

in cost of the program, including reductions made in funding 

for other programs to accommodate such cost growth; and 

(E) conduct regular reviews of the program in accordance 

with the requirements of section 205 of the Weapon Systems 

Acquisition Reform Act of 2009. 

(2) For purposes of paragraph (1)(D), the report specified in 

this paragraph is the first Selected Acquisition Report for the program submitted pursuant to section 2432 of this title after the 

President submits a budget pursuant to section 1105 of title 31, in 

the calendar year following the year in which the program was restructured. 

(d) ACTIONS IF PROGRAM TERMINATED.—If a major defense acquisition program is terminated pursuant to subsection (b), the 

Secretary shall submit to Congress a written report setting forth— 

(1) an explanation of the reasons for terminating the program; 

(2) the alternatives considered to address any problems in 

the program; and 
§ 2434 CH. 144—MAJOR DEFENSE ACQUISITION PROGRAMS 1348 

(3) the course the Department plans to pursue to meet any 

continuing joint military requirements otherwise intended to 

be met by the program. 

(Added Pub. L. 111–23, title II, Sec. 206(a)(1), May 22, 2009, 123 Stat. 1726; amended Pub. L. 

111–383, div. A, title X, Sec. 1075(b)(35), Jan. 7, 2011, 124 Stat. 4371.) 

§ 2434. Independent cost estimates; operational manpower 

requirements 

(a) REQUIREMENT FOR APPROVAL.—(1) The Secretary of Defense 

may not approve the system development and demonstration, or 

the production and deployment, of a major defense acquisition program unless an independent estimate of the full life-cycle cost of 

the program and a manpower estimate for the program have been 

considered by the Secretary. 

(2) The provisions of this section shall apply to any major subprogram of a major defense acquisition program (as designated 

under section 2430a(a)(1) of this title) in the same manner as those 

provisions apply to a major defense acquisition program, and any 

reference in this section to a program shall be treated as including 

such a subprogram. 

(b) REGULATIONS.—The Secretary of Defense shall prescribe 

regulations governing the content and submission of the estimates 

required by subsection (a). The regulations shall require— 

(1) that the independent estimate of the full life-cycle cost 

of a program— 

(A) be prepared or approved by the Director of Cost 

Assessment and Program Evaluation; and 

(B) include all costs of development, procurement, 

military construction, and operations and support, without 

regard to funding source or management control; and 

(2) that the manpower estimate include an estimate of the 

total number of personnel required— 

(A) to operate, maintain, and support the program 

upon full operational deployment; and 

(B) to train personnel to carry out the activities referred to in subparagraph (A). 

(Added Pub. L. 98–94, title XII, Sec. 1203(a)(1), Sept. 24, 1983, 97 Stat. 682, Sec. 139c; renumbered Sec. 2434 and amended Pub. L. 99–433, title I, Sec. 101(a)(5), 110(d)(15), (g)(9), Oct. 1, 

1986, 100 Stat. 995, 1003, 1004; Pub. L. 99–661, div. A, title XII, Sec. 1208(a)–(c)(1), Nov. 14, 

1986, 100 Stat. 3975; Pub. L. 100–26, Sec. 7(b)(5), Apr. 21, 1987, 101 Stat. 279; Pub. L. 100– 

180, div. A, title XIII, Sec. 1314(a)(1), Dec. 4, 1987, 101 Stat. 1175; Pub. L. 100–456, div. A, 

title V, Sec. 525, Sept. 29, 1988, 102 Stat. 1975; Pub. L. 102–190, div. A, title VIII, Sec. 801(a), 

(b)(1), Dec. 5, 1991, 105 Stat. 1412; Pub. L. 103–355, title III, Sec. 3004, Oct. 13, 1994, 108 Stat. 

3330; Pub. L. 104–106, div. A, title VIII, Sec. 814, Feb. 10, 1996, 110 Stat. 395; Pub. L. 107– 

107, div. A, title VIII, Sec. 821(a), Dec. 28, 2001, 115 Stat. 1181; Pub. L. 111–23, title I, Sec. 

101(d)(5), May 22, 2009, 123 Stat. 1710; Pub. L. 111–383, div. A, title VIII, Sec. 814(e), Jan. 

7, 2011, 124 Stat. 4267.) 

§ 2435. Baseline description 

(a) BASELINE DESCRIPTION REQUIREMENT.—(1) The Secretary 

of a military department shall establish a baseline description for 

each major defense acquisition program and for each designated 

major subprogram under the program under the jurisdiction of 

such Secretary. 

(2) The baseline shall include sufficient parameters to describe 

the cost estimate (referred to as the ‘‘Baseline Estimate’’ in section 

2433 of this title), schedule, performance, supportability, and any 
1349 § 2435 CH. 144—MAJOR DEFENSE ACQUISITION PROGRAMS 

other factor of such major defense acquisition program or designated major subprogram. 

(b) FUNDING LIMIT.—No amount appropriated or otherwise 

made available to the Department of Defense for carrying out a 

major defense acquisition program or any designated major subprogram under the program may be obligated after the program or 

subprogram enters system development and demonstration without 

an approved baseline description unless such obligation is specifically approved by the Under Secretary of Defense for Acquisition, 

Technology, and Logistics. 

(c) SCHEDULE.—A baseline description for a major defense acquisition program or any designated major subprogram under the 

program shall be prepared under this section— 

(1) before the program or subprogram enters system development and demonstration; 

(2) before the program or subprogram enters production 

and deployment; and 

(3) before the program or subprogram enters full rate production. 

(d) ORIGINAL BASELINE ESTIMATE.—(1) In this chapter, the 

term ‘‘original Baseline Estimate’’, with respect to a major defense 

acquisition program or any designated major subprogram under 

the program, means the baseline description established with respect to the program or subprogram under subsection (a) prepared 

before the program or subprogram enters system development and 

demonstration, or at program or subprogram initiation, whichever 

occurs later, without adjustment or revision (except as provided in 

paragraph (2)). 

(2) An adjustment or revision of the original baseline description of a major defense acquisition program or any designated 

major subprogram under the program may be treated as the original Baseline Estimate for the program or subprogram for purposes 

of this chapter only if the percentage increase in the program acquisition unit cost or procurement unit cost under such adjustment 

or revision exceeds the critical cost growth threshold for the program or subprogram under section 2433 of this title, as determined 

by the Secretary of the military department concerned under subsection (d) of such section. 

(3) In the event of an adjustment or revision of the original 

baseline description of a major defense acquisition program or any 

designated major subprogram under the program, the Secretary of 

Defense shall include in the next Selected Acquisition Report to be 

submitted under section 2432 of this title after such adjustment or 

revision a notification to the congressional defense committees of 

such adjustment or revision, together with the reasons for such adjustment or revision. 

(e) REGULATIONS.—The Secretary of Defense shall prescribe 

regulations governing the following: 

(1) The content of baseline descriptions under this section. 

(2) The submission to the Secretary of the military department concerned and the Under Secretary of Defense for Acquisition, Technology, and Logistics by the program manager for 

a program for which there is an approved baseline description 

(or in the case of a major defense acquisition program with one 
§ 2436 CH. 144—MAJOR DEFENSE ACQUISITION PROGRAMS 1350 

or more designated major subprograms, approved baseline descriptions for such subprograms) under this section of reports 

of deviations from any such baseline description of the cost, 

schedule, performance, supportability, or any other factor of 

the program or subprogram. 

(3) Procedures for review of such deviation reports within 

the Department of Defense. 

(4) Procedures for submission to, and approval by, the Secretary of Defense of revised baseline descriptions. 

(Added Pub. L. 99–500, Sec. 101(c) [title X, Sec. 904(a)(1)], Oct. 18, 1986, 100 Stat. 1783–82, 

1783–133, and Pub. L. 99–591, Sec. 101(c) [title X, Sec. 904(a)(1)], Oct. 30, 1986, 100 Stat. 3341– 

82, 3341–133; Pub. L. 99–661, div. A, title IX, formerly title IV, Sec. 904(a)(1), Nov. 14, 1986, 

100 Stat. 3912, renumbered title IX, Pub. L. 100–26, Sec. 3(5), Apr. 21, 1987, 101 Stat. 273; 

amended Pub. L. 100–26, Sec. 7(b)(6), Apr. 21, 1987, 101 Stat. 280; Pub. L. 100–180, div. A, 

title VIII, Sec. 803(a), Dec. 4, 1987, 101 Stat. 1125; Pub. L. 100–370, Sec. 1(i)(1), July 19, 1988, 

102 Stat. 848; Pub. L. 100–456, div. A, title XII, Sec. 1233(l)(4), Sept. 29, 1988, 102 Stat. 2058; 

Pub. L. 101–189, div. A, title VIII, Sec. 811(b), Nov. 29, 1989, 103 Stat. 1493; Pub. L. 101–510, 

div. A, title XII, Sec. 1207(b), title XIV, Sec. 1484(k)(11), Nov. 5, 1990, 104 Stat. 1665, 1719; 

Pub. L. 103–160, div. A, title IX, Sec. 904(d)(1), Nov. 30, 1993, 107 Stat. 1728; Pub. L. 103– 

355, title III, Sec. 3005(a), Oct. 13, 1994, 108 Stat. 3330; Pub. L. 107–107, div. A, title VIII, 

Sec. 821(d), title X, Sec. 1048(b)(2), Dec. 28, 2001, 115 Stat. 1182, 1225; Pub. L. 109–163, div. 

A, title VIII, Sec. 802(d)(1), Jan. 6, 2006, 119 Stat. 3369; Pub. L. 109–364, div. A, title VIII, 

Sec. 806, Oct. 17, 2006, 120 Stat. 2315; Pub. L. 110–417, [div. A], title VIII, Sec. 811(d), Oct. 

14, 2008, 122 Stat. 4524.) 

§ 2436. Major defense acquisition programs: incentive program for contractors to purchase capital assets 

manufactured in United States 

(a) ESTABLISHMENT OF INCENTIVE PROGRAM.—The Secretary of 

Defense shall plan and establish an incentive program in accordance with this section for contractors to purchase capital assets 

manufactured in the United States in part with funds available to 

the Department of Defense. 

(b) DEFENSE INDUSTRIAL CAPABILITIES FUND MAY BE USED.— 

The Secretary of Defense may use the Defense Industrial Capabilities Fund, established under section 814 of the National Defense 

Authorization Act for Fiscal Year 2004, for incentive payments 

under the program established under this section. 

(c) APPLICABILITY TO MAJOR DEFENSE ACQUISITION PROGRAM

CONTRACTS.—The incentive program shall apply to contracts for 

the procurement of a major defense acquisition program. 

(d) CONSIDERATION.—The Secretary of Defense shall provide 

consideration in source selection in any request for proposals for a 

major defense acquisition program for offerors with eligible capital 

assets. 

(Added Pub. L. 108–136, div. A, title VIII, Sec. 822(a)(1), Nov. 24, 2003, 117 Stat. 1546.) 

§ 2437. Development of major defense acquisition programs: 

sustainment of system to be replaced 

(a) REQUIREMENT FOR SUSTAINING EXISTING FORCES.—(1) The 

Secretary of Defense shall require that, whenever a new major defense acquisition program begins development, the defense acquisition authority responsible for that program shall develop a plan (to 

be known as a ‘‘sustainment plan’’) for the existing system that the 

system under development is intended to replace. Any such 

sustainment plan shall provide for an appropriate level of budgeting for sustaining the existing system until the replacement system to be developed under the major defense acquisition program 
1351 § 2437 CH. 144—MAJOR DEFENSE ACQUISITION PROGRAMS 

is fielded and assumes the majority of responsibility for the mission 

of the existing system. This section does not apply to a major defense acquisition that reaches initial operational capability before 

October 1, 2008. 

(2) In this section, the term ‘‘defense acquisition authority’’ 

means the Secretary of a military department or the commander 

of the United States Special Operations Command. 

(b) SUSTAINMENT PLAN.—The Secretary of Defense shall require that each sustainment plan under this section include, at a 

minimum, the following: 

(1) The milestone schedule for the development of the 

major defense acquisition program, including the scheduled 

dates for low-rate initial production, initial operational capability, full-rate production, and full operational capability and 

the date as of when the replacement system is scheduled to assume the majority of responsibility for the mission of the existing system. 

(2) An analysis of the existing system to assess the following: 

(A) Anticipated funding levels necessary to— 

(i) ensure acceptable reliability and availability 

rates for the existing system; and 

(ii) maintain mission capability of the existing system against the relevant threats. 

(B) The extent to which it is necessary and appropriate to— 

(i) transfer mature technologies from the new system or other systems to enhance the mission capability of the existing system against relevant threats; 

and 

(ii) provide interoperability with the new system 

during the period from initial fielding until the new 

system assumes the majority of responsibility for the 

mission of the existing system. 

(c) EXCEPTIONS.—Subsection (a) shall not apply to a major defense acquisition program if the Secretary of Defense determines 

that— 

(1) the existing system is no longer relevant to the mission; 

(2) the mission has been eliminated; 

(3) the mission has been consolidated with another mission 

in such a manner that another existing system can adequately 

meet the mission requirements; or 

(4) the duration of time until the new system assumes the 

majority of responsibility for the existing system’s mission is 

sufficiently short so that mission availability, capability, interoperability, and force protection requirements are maintained. 

(d) WAIVER.—The Secretary of Defense may waive the applicability of subsection (a) to a major defense acquisition program if the 

Secretary determines that, but for such a waiver, the Department 

would be unable to meet national security objectives. Whenever the 

Secretary makes such a determination and authorizes such a waiver, the Secretary shall submit notice of such waiver and of the Secretary’s determination and the reasons therefor in writing to the 

congressional defense committees. 
§ 2438 CH. 144—MAJOR DEFENSE ACQUISITION PROGRAMS 1352 

1 In subsection (a)(3), ‘‘the senior’’ should probably appear before ‘‘official’s’’. 

(Added Pub. L. 108–375, div. A, title VIII, Sec. 805(a)(1), Oct. 28, 2004, 118 Stat. 2008. 

§ 2438. Performance assessments and root cause analyses 

(a) DESIGNATION OF SENIOR OFFICIAL RESPONSIBILITY FOR PERFORMANCE ASSESSMENTS AND ROOT CAUSE ANALYSES.— 

(1) IN GENERAL.—The Secretary of Defense shall designate 

a senior official in the Office of the Secretary of Defense as the 

principal official of the Department of Defense responsible for 

conducting and overseeing performance assessments and root 

cause analyses for major defense acquisition programs. 

(2) NO PROGRAM EXECUTION RESPONSIBILITY.—The Secretary shall ensure that the senior official designated under 

paragraph (1) is not responsible for program execution. 

(3) STAFF AND RESOURCES.—The Secretary shall assign to 

the senior official designated under paragraph (1) appropriate 

staff and resources necessary to carry out official’s 1 function 

under this section. 

(b) RESPONSIBILITIES.—The senior official designated under 

subsection (a) shall be responsible for the following: 

(1) Carrying out performance assessments of major defense 

acquisition programs in accordance with the requirements of 

subsection (c) periodically or when requested by the Secretary 

of Defense, the Under Secretary of Defense for Acquisition, 

Technology and Logistics, the Secretary of a military department, or the head of a Defense Agency. 

(2) Conducting root cause analyses for major defense acquisition programs in accordance with the requirements of subsection (d) when required by section 2433a(a)(1) of this title, or 

when requested by the Secretary of Defense, the Under Secretary of Defense for Acquisition, Technology and Logistics, the 

Secretary of a military department, or the head of a Defense 

Agency. 

(3) Issuing policies, procedures, and guidance governing 

the conduct of performance assessments and root cause analyses by the military departments and the Defense Agencies. 

(4) Evaluating the utility of performance metrics used to 

measure the cost, schedule, and performance of major defense 

acquisition programs, and making such recommendations to 

the Secretary of Defense as the official considers appropriate to 

improve such metrics. 

(5) Advising acquisition officials on performance issues regarding a major defense acquisition program that may arise— 

(A) before certification under section 2433a of this 

title; 

(B) before entry into full-rate production; or 

(C) in the course of consideration of any decision to request authorization of a multiyear procurement contract 

for the program. 

(c) PERFORMANCE ASSESSMENTS.—For purposes of this section, 

a performance assessment with respect to a major defense acquisition program is an evaluation of the following: 
1353 § 2440 CH. 144—MAJOR DEFENSE ACQUISITION PROGRAMS 

(1) The cost, schedule, and performance of the program, 

relative to current metrics, including performance requirements and baseline descriptions. 

(2) The extent to which the level of program cost, schedule, 

and performance predicted relative to such metrics is likely to 

result in the timely delivery of a level of capability to the 

warfighter that is consistent with the level of resources to be 

expended and provides superior value to alternative approaches that may be available to meet the same military requirement. 

(d) ROOT CAUSE ANALYSES.—For purposes of this section and 

section 2433a of this title, a root cause analysis with respect to a 

major defense acquisition program is an assessment of the underlying cause or causes of shortcomings in cost, schedule, or performance of the program, including the role, if any, of— 

(1) unrealistic performance expectations; 

(2) unrealistic baseline estimates for cost or schedule; 

(3) immature technologies or excessive manufacturing or 

integration risk; 

(4) unanticipated design, engineering, manufacturing, or 

technology integration issues arising during program performance; 

(5) changes in procurement quantities; 

(6) inadequate program funding or funding instability; 

(7) poor performance by government or contractor personnel responsible for program management; or 

(8) any other matters. 

(e) SUPPORT OF APPLICABLE CAPABILITIES AND EXPERTISE.— 

The Secretary of Defense shall ensure that the senior official designated under subsection (a) has the support of other Department 

of Defense officials with relevant capabilities and expertise needed 

to carry out the requirements of this section. 

(f) ANNUAL REPORT.—Not later than March 1 each year, the official responsible for conducting and overseeing performance assessments and root cause analyses for major defense acquisition 

programs shall submit to the congressional defense committees a 

report on the activities undertaken under this section during the 

preceding year. 

(Pub. L. 111–23, title I, Sec. 103, May 22, 2009, 123 Stat. 1715; renumbered Sec. 2438 of title 

10 and amended Pub. L. 111–383, div. A, title IX, Sec. 901(d), (k)(1)(F), Jan. 7, 2011, 124 Stat. 

4321, 4325.) 

[§ 2439. Repealed. Pub. L. 103–355, title III, Sec. 3006(a), 

3007(a), Oct. 13, 1994, 108 Stat. 3331] 

§ 2440. Technology and industrial base plans 

The Secretary of Defense shall prescribe regulations requiring 

consideration of the national technology and industrial base in the 

development and implementation of acquisition plans for each 

major defense acquisition program. 

(Added Pub. L. 102–484, div. D, title XLII, Sec. 4216(b)(1), Oct. 23, 1992, 106 Stat. 2669; amended Pub. L. 109–364, div. A, title X, Sec. 1071(a)(17), Oct. 17, 2006, 120 Stat. 2399.) 
1354 

CHAPTER 144A—MAJOR AUTOMATED INFORMATION 

SYSTEM PROGRAMS 

Sec. 

2445a. Definitions. 

2445b. Cost, schedule, and performance information. 

2445c. Reports: quarterly reports; reports on program changes. 

2445d. Construction with other reporting requirements. 

§ 2445a. Definitions 

(a) MAJOR AUTOMATED INFORMATION SYSTEM PROGRAM.—In 

this chapter, the term ‘‘major automated information system program’’ means a Department of Defense program for the acquisition 

of an automated information system (either as a product or a service) if— 

(1) the program is designated by the Secretary of Defense, 

or a designee of the Secretary, as a major automated information system program; or 

(2) the dollar value of the program is estimated to exceed— 

(A) $32,000,000 in fiscal year 2000 constant dollars for 

all program costs in a single fiscal year; (B) $126,000,000 in fiscal year 2000 constant dollars 

for all program acquisition costs for the entire program; or 

(C) $378,000,000 in fiscal year 2000 constant dollars 

for the total life-cycle costs of the program (including operation and maintenance costs). 

(b) ADJUSTMENT.—The Secretary of Defense may adjust the 

amounts (and base fiscal year) set forth in subsection (a) on the 

basis of Department of Defense escalation rates. An adjustment 

under this subsection shall be effective after the Secretary transmits a written notification of the adjustment to the congressional 

defense committees. 

(c) INCREMENTS.—In the event any increment of a major automated information system program separately meets the requirements for treatment as a major automated information system program, the provisions of this chapter shall apply to such increment 

as well as to the overall major automated information system program of which such increment is a part. 

(d) OTHER MAJOR INFORMATION TECHNOLOGY INVESTMENT

PROGRAM.—In this chapter, the term ‘‘other major information 

technology investment program’’ means the following: 

(1) An investment that is designated by the Secretary of 

Defense, or a designee of the Secretary, as a ‘‘pre-Major Automated Information System’’ or ‘‘pre-MAIS’’ program. 

(2) Any other investment in automated information system 

products or services that is expected to exceed the thresholds 

established in subsection (a), as adjusted under subsection (b), 

but is not considered to be a major automated information sys-
1355 § 2445b CH. 144A—MAJOR AUTOMATED INFO SYSTEM PGMS 

tem program because a formal acquisition decision has not yet 

been made with respect to such investment. 

(e) FULL DEPLOYMENT DECISION.—In this chapter, the term 

‘‘full deployment decision’’ means, with respect to a major automated information system program, the final decision made by the 

Milestone Decision Authority authorizing an increment of the program to deploy software for operational use. 

(f) FULL DEPLOYMENT.—In this chapter, the term ‘‘full deployment’’ means, with respect to a major automated information system program, the fielding of an increment of the program in accordance with the terms of a full deployment decision. 

(Added Pub. L. 109–364, div. A, title VIII, Sec. 816(a)(1), Oct. 17, 2006, 120 Stat. 2323; amended 

Pub. L. 110–417, [div. A], title VIII, Sec. 812(a)(1), (2), Oct. 14, 2008, 122 Stat. 4525; Pub. L. 

111–84, div. A, title VIII, Sec. 841(c), Oct. 28, 2009, 123 Stat. 2418.) 

§ 2445b. Cost, schedule, and performance information 

(a) SUBMITTAL OF COST, SCHEDULE, AND PERFORMANCE INFORMATION.—The Secretary of Defense shall submit to Congress each 

calendar year, not later than 45 days after the President submits 

to Congress the budget for a fiscal year under section 1105 of title 

31, budget justification documents regarding cost, schedule, and 

performance for each major automated information system program 

and each other major information technology investment program 

for which funds are requested by the President in the budget. 

(b) ELEMENTS REGARDING MAJOR AUTOMATED INFORMATION

SYSTEM PROGRAMS.—The documents submitted under subsection 

(a) with respect to a major automated information system program 

shall include detailed and summarized information with respect to 

the automated information system to be acquired under the program, and shall specifically include each of the following: 

(1) The development schedule, including major milestones. 

(2) The implementation schedule, including estimates of 

milestone dates, full deployment decision, and full deployment. 

(3) Estimates of development costs and full life-cycle costs. 

(4) A summary of key performance parameters. 

(5) For each major automated information system program 

for which such information has not been provided in a previous 

annual report— 

(A) a description of the business case analysis (if any) 

that has been prepared for the program and key functional 

requirements for the program; 

(B) a description of the analysis of alternatives conducted with regard to the program; 

(C) an assessment of the extent to which the program, 

or portions of the program, have technical requirements of 

sufficient clarity that the program, or portions of the program, may be feasibly procured under firm, fixed-price contracts; 

(D) the most recent independent cost estimate or cost 

analysis for the program provided by the Director of Cost 

Assessment and Program Evaluation in accordance with 

section 2334(a)(6) of this title; 

(E) a certification by a Department of Defense acquisition official with responsibility for the program that all 
§ 2445c CH. 144A—MAJOR AUTOMATED INFO SYSTEM PGMS 1356 

technical and business requirements have been reviewed 

and validated to ensure alignment with the business case; 

and 

(F) an explanation of the basis for the certification described in subparagraph (E). 

(6) For each major automated information system program 

for which the information required under paragraph (5) has 

been provided in a previous annual report, a summary of any 

significant changes to the information previously provided. 

(c) BASELINE.—(1) For purposes of this chapter, the initial submittal to Congress of the documents required by subsection (a) with 

respect to a major automated information system program shall 

constitute the original estimate or information originally submitted 

on such program for purposes of the reports and determinations on 

program changes in section 2445c of this title. 

(2) An adjustment or revision of the original estimate or information originally submitted on a program may be treated as the 

original estimate or information originally submitted on the program if the adjustment or revision is the result of a critical change 

in the program covered by section 2445c(d) of this title. 

(3) In the event of an adjustment or revision to the original estimate or information originally submitted on a program under 

paragraph (2), the Secretary of Defense shall include in the next 

budget justification documents submitted under subsection (a) after 

such adjustment or revision a notification to the congressional defense committees of such adjustment or revision, together with the 

reasons for such adjustment or revision. 

(d) ELEMENTS REGARDING OTHER MAJOR INFORMATION TECHNOLOGY INVESTMENT PROGRAMS.—With respect to each other major 

information technology investment program, the information required by subsection (a) may be provided in the format that is most 

appropriate to the current status of the program. 

(Added Pub. L. 109–364, div. A, title VIII, Sec. 816(a)(1), Oct. 17, 2006, 120 Stat. 2323; amended 

Pub. L. 110–417, [div. A], title VIII, Sec. 812(b), Oct. 14, 2008, 122 Stat. 4525; Pub. L. 111– 

84, div. A, title VIII, Sec. 841(a), Oct. 28, 2009, 123 Stat. 2418; Pub. L. 111–383, div. A, title 

VIII, Sec. 805(b), Jan. 7, 2011, 124 Stat. 4259.) 

§ 2445c. Reports: quarterly reports; reports on program 

changes 

(a) QUARTERLY REPORTS BY PROGRAM MANAGERS.—The program manager of a major automated information system program 

or other major information technology investment program shall, 

on a quarterly basis, submit to the senior Department of Defense 

official responsible for the program a written report identifying any 

variance in the projected development schedule, implementation 

schedule, life-cycle costs, or key performance parameters for the 

major automated information system or information technology investment to be acquired under the program from such information 

as originally submitted to Congress under section 2445b of this 

title. 

(b) SENIOR OFFICIALS RESPONSIBLE FOR PROGRAMS.—For purposes of this section, the senior Department of Defense official responsible for a major automated information system program or 

other major information technology investment program is— 
1357 § 2445c CH. 144A—MAJOR AUTOMATED INFO SYSTEM PGMS 

(1) in the case of an automated information system or information technology investment to be acquired for a military 

department, the senior acquisition executive for the military 

department; or 

(2) in the case of any other automated information system 

or information technology investment to be acquired for the 

Department of Defense or any component of the Department of 

Defense, the Under Secretary of Defense for Acquisition, Technology, and Logistics. 

(c) REPORT ON SIGNIFICANT CHANGES IN PROGRAM.— 

(1) IN GENERAL.—If, based on a quarterly report submitted 

by the program manager of a major automated information 

system program pursuant to subsection (a), the senior Department of Defense official responsible for the program makes a 

determination described in paragraph (2), the official shall, not 

later than 45 days after receiving such report, notify the congressional defense committees in writing of such determination. 

(2) COVERED DETERMINATION.—A determination described 

in this paragraph with respect to a major automated information system program is a determination that— 

(A) there has been a schedule change that will cause 

a delay of more than six months but less than a year in 

any program schedule milestone or significant event from 

the schedule originally submitted to Congress under paragraph (1) or (2) of section 2445b(b) of this title; 

(B) the estimated program development cost or full 

life-cycle cost for the program has increased by at least 15 

percent, but less than 25 percent, over the original estimate submitted to Congress under paragraph (3) of section 

2445b(b) of this title; or 

(C) there has been a significant, adverse change in the 

expected performance of the major automated information 

system to be acquired under the program from the parameters originally submitted to Congress under paragraph (4) 

of section 2445b(b) of this title. 

(d) REPORT ON CRITICAL CHANGES IN PROGRAM.— 

(1) IN GENERAL.—If, based on a quarterly report submitted 

by the program manager of a major automated information 

system program or other major information technology investment program pursuant to subsection (a), the senior Department of Defense official responsible for the program makes a 

determination described in paragraph (2), the official shall, not 

later than 60 days after receiving such report— 

(A) carry out an evaluation of the program under subsection (e); and 

(B) submit, through the Secretary of Defense, to the 

congressional defense committees a report meeting the requirements of subsection (f). 

(2) COVERED DETERMINATION.—A determination described 

in this paragraph with respect to a major automated information system program or other major information technology investment program is a determination that— 
§ 2445c CH. 144A—MAJOR AUTOMATED INFO SYSTEM PGMS 1358 

(A) the automated information system or information 

technology investment failed to achieve a full deployment 

decision within five years after funds were first obligated 

for the program; 

(B) there has been a schedule change that will cause 

a delay of one year or more in any program schedule milestone or significant event from the schedule originally submitted to Congress under paragraph (1) or (2) of section 

2445b(b) of this title or section 2445b(d) of this title, as applicable; 

(C) the estimated program development cost or full 

life-cycle cost for the program has increased by 25 percent 

or more over the original estimate submitted to Congress 

under paragraph (3) of section 2445b(b) of this title or section 2445b(d) of this title, as applicable; or 

(D) there has been a change in the expected performance of the major automated information system or major 

information technology investment to be acquired under 

the program that will undermine the ability of the system 

to perform the functions anticipated at the time information on the program was originally submitted to Congress 

under section 2445b(b) of this title or section 2445b(d) of 

this title, as applicable. 

(e) PROGRAM EVALUATION.—The evaluation of a major automated information system program or other major information 

technology investment program conducted under this subsection for 

purposes of subsection (d)(1)(A) shall include an assessment of— 

(1) the projected cost and schedule for completing the program if current requirements are not modified; 

(2) the projected cost and schedule for completing the program based on reasonable modification of such requirements; 

and 

(3) the rough order of magnitude of the cost and schedule 

for any reasonable alternative system or capability. 

(f) REPORT ON CRITICAL PROGRAM CHANGES.—A report on a 

major automated information system program or other major information technology investment program conducted under this subsection for purposes of subsection (d)(1)(B) shall include a written 

certification (with supporting explanation) stating that— 

(1) the automated information system or information technology investment to be acquired under the program is essential to the national security or to the efficient management of 

the Department of Defense; 

(2) there is no alternative to the system or information 

technology investment which will provide equal or greater capability at less cost; 

(3) the new estimates of the costs, schedule, and performance parameters with respect to the program and system or information technology investment, as applicable, have been determined, with the concurrence of the Director of Cost Assessment and Program Evaluation, to be reasonable; and 

(4) the management structure for the program is adequate 

to manage and control program costs. 
1359 § 2445d CH. 144A—MAJOR AUTOMATED INFO SYSTEM PGMS 

(g) PROHIBITION ON OBLIGATION OF FUNDS.—(1) If the determination of a critical change to a program is made by the senior 

Department official responsible for the program under subsection 

(d)(2) and a report is not submitted to Congress within the 60-day 

period provided by subsection (d)(1), appropriated funds may not be 

obligated for any major contract under the program. 

(2) The prohibition on the obligation of funds for a program 

under paragraph (1) shall cease to apply on the date on which Congress has received a report in compliance with the requirements of 

subsection (d)(2). 

(Added Pub. L. 109–364, div. A, title VIII, Sec. 816(a)(1), Oct. 17, 2006, 120 Stat. 2324; amended 

Pub. L. 110–417, [div. A], title VIII, Sec. 812(c), Oct. 14, 2008, 122 Stat. 4526; Pub. L. 111– 

23, title I, Sec. 101(d)(6), May 22, 2009, 123 Stat. 1710; Pub. L. 111–84, div. A, title VIII, Sec. 

841(b), Oct. 28, 2009, 123 Stat. 2418.) 

§ 2445d. Construction with other reporting requirements 

In the case of a major automated information system program 

covered by this chapter that is also treatable as a major defense 

acquisition program for which reports would be required under 

chapter 144 of this title, the Secretary may designate the program 

to be treated only as a major automated information system program covered by this chapter or to be treated only as a major defense acquisition program covered by such chapter 144. 

(Added Pub. L. 109–364, div. A, title VIII, Sec. 816(a)(1), Oct. 17, 2006, 120 Stat. 2326; amended 

Pub. L. 111–84, div. A, title VIII, Sec. 817(a), Oct. 28, 2009, 123 Stat. 2408.) 
1360 

CHAPTER 145—CATALOGING AND STANDARDIZATION 

Sec. 

2451. Defense supply management. 

2452. Duties of Secretary of Defense. 

2453. Supply catalog: distribution and use. 

2454. Supply catalog: new or obsolete items. 

[2455. Repealed.] 

2456. Coordination with General Services Administration. 

2457. Standardization of equipment with North Atlantic Treaty Organization 

members. 

2458. Inventory management policies. 

§ 2451. Defense supply management 

(a) The Secretary of Defense shall develop a single catalog system and related program of standardizing supplies for the Department of Defense. 

(b) In cataloging, the Secretary shall name, describe, classify, 

and number each item recurrently used, bought, stocked, or distributed by the Department of Defense, so that only one distinctive 

combination of letters or numerals, or both, identifies the same 

item throughout the Department of Defense. Only one identification may be used for each item for all supply functions from purchase to final disposal in the field or other area. The catalog may 

consist of a number of volumes, sections, or supplements. It shall 

include all items of supply and, for each item, information needed 

for supply operations, such as descriptive and performance data, 

size, weight, cubage, packaging and packing data, a standard quantitative unit of measurement, and other related data that the Secretary determines to be desirable. 

(c) In standardizing supplies the Secretary shall, to the highest 

degree practicable— 

(1) standardize items used throughout the Department of 

Defense by developing and using single specifications, eliminating overlapping and duplicate specifications, and reducing 

the number of sizes and kinds of items that are generally similar; 

(2) standardize the methods of packing, packaging, and 

preserving such items; and 

(3) make efficient use of the services and facilities for inspecting, testing, and accepting such items. 

(d) The Secretary shall coordinate with the Administrator of 

General Services to enable the use of commercial identifiers for 

commercial items within the Federal cataloging system. 

(Aug. 10, 1956, ch. 1041, 70A Stat. 138; Sept. 2, 1958, Pub. L. 85–861, Sec. 33(a)(13), 72 Stat. 

1565; Pub. L. 108–136, div. A, title III, Sec. 341, Nov. 24, 2003, 117 Stat. 1448.) 

§ 2452. Duties of Secretary of Defense 

The Secretary of Defense shall— 
1361 § 2454 CH. 145—CATALOGING AND STANDARDIZATION 

(1) develop and maintain the supply catalog, and the 

standardization program, described in section 2451 of this title; 

(2) direct and coordinate progressive use of the supply 

catalog in all supply functions within the Department of Defense from the determination of requirements through final 

disposal; 

(3) direct, review, and approve— 

(A) the naming, description, and pattern of description 

of all items; 

(B) the screening, consolidation, classification, and 

numbering of descriptions of all items; and 

(C) the publication and distribution of the supply catalog; 

(4) maintain liaison with industry advisory groups to coordinate the development of the supply catalog and the standardization program with the best practices of industry and to 

obtain the fullest practicable cooperation and participation of 

industry in developing the supply catalog and the standardization program; 

(5) establish, publish, review, and revise, within the Department of Defense, military specifications, standards, and 

lists of qualified products, and resolve differences between the 

military departments, bureaus, and services with respect to 

them; 

(6) assign responsibility for parts of the cataloging and the 

standardization programs to the military departments, bureaus, and services within the Department of Defense, when 

practical and consistent with their capacity and interest in 

those supplies; 

(7) establish time schedules for assignments made under 

clause (6); and 

(8) make final decisions in all matters concerned with the 

cataloging and standardization programs. 

(Aug. 10, 1956, ch. 1041, 70A Stat. 139.) 

§ 2453. Supply catalog: distribution and use 

The Secretary of Defense shall distribute the parts of the supply catalog described in section 2451 of this title as they are completed. Existing catalogs shall be replaced according to schedules 

established by the Secretary. After replacement no other supply 

catalog may be used within the Department of Defense with respect to the kinds of items covered by that part. All property reports and records shall use the nomenclature, item numbers, and 

descriptive data of the supply catalog. 

(Aug. 10, 1956, ch. 1041, 70A Stat. 139.) 

§ 2454. Supply catalog: new or obsolete items 

(a) After any part of the supply catalog described in section 

2451 of this title is distributed, and with respect to the kinds of 

items covered by that part, only the items listed in it may be procured for recurrent use in the Department of Defense. However, a 

military department may acquire any new item that is necessary 

to carry out its mission. As soon as such an item is acquired, it 
[§ 2455 CH. 145—CATALOGING AND STANDARDIZATION 1362 

shall be submitted to the Secretary for inclusion in the catalog and 

the standardization program. 

(b) Obsolete items may be deleted from the catalog at any time. 

(Aug. 10, 1956, ch. 1041, 70A Stat. 140.) 

[§ 2455. Repealed. Pub. L. 101–510, div. A, title XIII, Sec. 

1322(a)(9), Nov. 5, 1990, 104 Stat. 1671] 

§ 2456. Coordination with General Services Administration 

To avoid unnecessary duplication, the Administrator of General Services and the Secretary of Defense shall coordinate the cataloging and standardization activities of the General Services Administration and the Department of Defense. 

(Aug. 10, 1956, ch. 1041, 70A Stat. 140.) 

§ 2457. Standardization of equipment with North Atlantic 

Treaty Organization members 

(a) It is the policy of the United States to standardize equipment, including weapons systems, ammunition, and fuel, procured 

for the use of the armed forces of the United States stationed in 

Europe under the North Atlantic Treaty or at least to make that 

equipment interoperable with equipment of other members of the 

North Atlantic Treaty Organization. To carry out this policy, the 

Secretary of Defense shall— 

(1) assess the costs and possible loss of nonnuclear combat 

effectiveness of the military forces of the members of the Organization caused by the failure of the members to standardize 

equipment; 

(2) maintain a list of actions to be taken, including an 

evaluation of the priority and effect of the action, to standardize equipment that may improve the overall nonnuclear defense capability of the Organization or save resources for the 

Organization; and 

(3) initiate and carry out, to the maximum extent feasible, 

procurement procedures to acquire standardized or interoperable equipment, considering the cost, function, quality, and 

availability of the equipment. 

(b) Progress in realizing the objectives of standardization and 

interoperability would be enhanced by expanded inter-Allied procurement of arms and equipment within the North Atlantic Treaty 

Organization. Expanded inter-Allied procurement would be made 

easier by greater reliance on licensing and coproduction cooperative 

agreements among the signatories of the North Atlantic Treaty. If 

constructed to preserve the efficiencies associated with economies 

of scale, the agreements could minimize potential economic hardship to parties to the agreements and increase the survivability, in 

time of war, of the North Atlantic Alliance’s armaments production 

base by dispersing manufacturing facilities. In conjunction with 

other members of the Organization and to the maximum extent 

feasible, the Secretary shall— 

(1) identify areas in which those cooperative agreements 

may be made with members of the Alliance; and 

(2) negotiate those agreements. 
1363 § 2458 CH. 145—CATALOGING AND STANDARDIZATION 

(c)(1) It is the sense of Congress that weapons systems being 

developed wholly or primarily for employment in the North Atlantic Treaty Organization theater should conform to a common Organization requirement in order to proceed toward joint doctrine and 

planning and to facilitate maximum feasible standardization and 

interoperability of equipment, and that a common Organization requirement should be understood to include a common definition of 

the military threat to the members of the Organization. 

(2) It is further the sense of Congress that standardization of 

weapons and equipment within the Organization on the basis of a 

‘‘two-way street’’ concept of cooperation in defense procurement between Europe and North America can only work in a realistic sense 

if the European nations operate on a united and collective basis. 

Therefore, the governments of Europe are encouraged to accelerate 

their present efforts to achieve European armaments collaboration 

among all European members of the Organization. 

[(d) Repealed. Pub. L. 108–136, div. A, title X, Sec. 1031(a)(22), 

Nov. 24, 2003, 117 Stat. 1598.] 

(e) If the Secretary decides that procurement of equipment 

manufactured outside the United States is necessary to carry out 

the policy of subsection (a), the Secretary may determine under section 8302 of title 41 that acquiring that equipment manufactured 

in the United States is inconsistent with the public interest. 

(f) The Secretary shall submit the results of each assessment 

and evaluation made under subsection (a)(1) and (2) to the appropriate North Atlantic Treaty Organization body to become an integral part of the overall Organization review of force goals and development of force plans. 

(Added Pub. L. 97–295, Sec. 1(30)(A), Oct. 12, 1982, 96 Stat. 1294; amended Pub. L. 101–510, 

div. A, title XIII, Sec. 1311(5), Nov. 5, 1990, 104 Stat. 1670; Pub. L. 104–106, div. A, title XV, 

Sec. 1503(a)(24), Feb. 10, 1996, 110 Stat. 512; Pub. L. 108–136, div. A, title X, Sec. 1031(a)(22), 

Nov. 24, 2003, 117 Stat. 1598; Pub. L. 111–350, Sec. 5(b)(33), Jan. 4, 2011, 124 Stat. 3845.) 

§ 2458. Inventory management policies 

(a) POLICY REQUIRED.—The Secretary of Defense shall issue a 

single, uniform policy on the management of inventory items of the 

Department of Defense. Such policy shall— 

(1) establish maximum levels for inventory items sufficient 

to achieve and maintain only those levels for inventory items 

necessary for the national defense; 

(2) provide guidance to item managers and other appropriate officials on how effectively to eliminate wasteful practices in the acquisition and management of inventory items; and 

(3) set forth a uniform system for the valuation of inventory items by the military departments and Defense Agencies. 

(b) PERSONNEL EVALUATIONS.—The Secretary of Defense shall 

establish procedures to ensure that, with regard to item managers 

and other personnel responsible for the acquisition and management of inventory items of the Department of Defense, personnel 

appraisal systems for such personnel give appropriate consideration to efforts made by such personnel to eliminate wasteful practices and achieve cost savings in the acquisition and management 

of inventory items. 

(Added Pub. L. 101–510, div. A, title III, Sec. 323(a)(1), Nov. 5, 1990, 104 Stat. 1530; amended 

Pub. L. 102–190, div. A, title III, Sec. 347(a), Dec. 5, 1991, 105 Stat. 1347.) 
1364 

CHAPTER 146—CONTRACTING FOR PERFORMANCE OF 

CIVILIAN COMMERCIAL OR INDUSTRIAL TYPE FUNCTIONS 

Sec. 

2460. Definition of depot-level maintenance and repair. 

2461. Public-private competition required before conversion to contractor performance. 

2461a. Development and implementation of system for monitoring cost saving resulting from public-private competitions. 

2462. Reports on public-private competition. 

2463. Guidelines and procedures for use of civilian employees to perform Department of Defense functions. 

2464. Core logistics capabilities. 

2465. Prohibition on contracts for performance of firefighting or security-guard 

functions. 

2466. Limitations on the performance of depot-level maintenance of materiel. 

[2467, 2468. Repealed.] 

2469. Contracts to perform workloads previously performed by depot-level activities of the Department of Defense: requirement of competition. 

[2469a. Repealed.] 

2470. Depot-level activities of the Department of Defense: authority to compete 

for maintenance and repair workloads of other Federal agencies. 

[2471. Repealed.] 

2472. Prohibition on management of depot employees by end strength. 

[2473. Repealed.] 

2474. Centers of Industrial and Technical Excellence: designation; public-private 

partnerships. 

2475. Consolidation, restructuring, or reengineering of organizations, functions, 

or activities: notification requirements. 

2476. Minimum capital investment for certain depots. 

§ 2460. Definition of depot-level maintenance and repair 

(a) IN GENERAL.—In this chapter, the term ‘‘depot-level maintenance and repair’’ means (except as provided in subsection (b)) 

material maintenance or repair requiring the overhaul, upgrading, 

or rebuilding of parts, assemblies, or subassemblies, and the testing and reclamation of equipment as necessary, regardless of the 

source of funds for the maintenance or repair or the location at 

which the maintenance or repair is performed. The term includes 

(1) all aspects of software maintenance classified by the Department of Defense as of July 1, 1995, as depot-level maintenance and 

repair, and (2) interim contractor support or contractor logistics 

support (or any similar contractor support), to the extent that such 

support is for the performance of services described in the preceding sentence. 

(b) EXCEPTIONS.—(1) The term does not include the procurement of major modifications or upgrades of weapon systems that 

are designed to improve program performance or the nuclear refueling of an aircraft carrier. A major upgrade program covered by 

this exception could continue to be performed by private or public 

sector activities. 
1365 § 2461 CH. 146—CONTRACTING FOR COMMERCIAL / INDUSTRIAL FNS 

(2) The term also does not include the procurement of parts for 

safety modifications. However, the term does include the installation of parts for that purpose. 

(Added Pub. L. 105–85, div. A, title III, Sec. 355(a), Nov. 18, 1997, 111 Stat. 1693; amended 

Pub. L. 105–261, div. A, title III, Sec. 341, Oct. 17, 1998, 112 Stat. 1973.) 

§ 2461. Public-private competition required before conversion to contractor performance 

(a) PUBLIC-PRIVATE COMPETITION.—(1) No function of the Department of Defense performed by Department of Defense civilian 

employees may be converted, in whole or in part, to performance 

by a contractor unless the conversion is based on the results of a 

public-private competition that— 

(A) formally compares the cost of performance of the function by Department of Defense civilian employees with the cost 

of performance by a contractor; 

(B) creates an agency tender, including a most efficient organization plan, in accordance with Office of Management and 

Budget Circular A–76, as implemented on May 29, 2003, or 

any successor circular; 

(C) includes the issuance of a solicitation; 

(D) determines whether the submitted offers meet the 

needs of the Department of Defense with respect to factors 

other than cost, including quality, reliability, and timeliness; 

(E) examines the cost of performance of the function by 

Department of Defense civilian employees and the cost of performance of the function by one or more contractors to demonstrate whether converting to performance by a contractor 

will result in savings to the Government over the life of the 

contract, including— 

(i) the estimated cost to the Government (based on offers received) for performance of the function by a contractor; 

(ii) the estimated cost to the Government for performance of the function by Department of Defense civilian employees; and 

(iii) an estimate of all other costs and expenditures 

that the Government would incur because of the award of 

such a contract; 

(F) requires continued performance of the function by Department of Defense civilian employees unless the difference in 

the cost of performance of the function by a contractor compared to the cost of performance of the function by Department 

of Defense civilian employees would, over all performance periods required by the solicitation, be equal to or exceed the lesser 

of— 

(i) 10 percent of the personnel-related costs for performance of that function in the agency tender; or 

(ii) $10,000,000; 

(G) requires that the contractor shall not receive an advantage for a proposal that would reduce costs for the Department 

of Defense by— 

(i) not making an employer-sponsored health insurance plan (or payment that could be used in lieu of such 
§ 2461 CH. 146—CONTRACTING FOR COMMERCIAL / INDUSTRIAL FNS 1366 

a plan), health savings account, or medical savings account 

available to the workers who are to be employed to perform the function under the contract; 

(ii) offering to such workers an employer-sponsored 

health benefits plan that requires the employer to contribute less towards the premium or subscription share 

than the amount that is paid by the Department of Defense for health benefits for civilian employees of the Department under chapter 89 of title 5; or 

(iii) offering to such workers a retirement benefit that, 

in any year, costs less than the annual retirement cost factor applicable to civilian employees of the Department of 

Defense under chapter 84 of title 5; and 

(H) examines the effect of performance of the function by 

a contractor on the military mission associated with the performance of the function. 

(2) A function that is performed by the Department of Defense 

and is reengineered, reorganized, modernized, upgraded, expanded, 

or changed to become more efficient, but still essentially provides 

the same service, shall not be considered a new requirement. 

(3) In no case may a function being performed by Department 

of Defense personnel be— 

(A) modified, reorganized, divided, or in any way changed 

for the purpose of exempting the conversion of the function 

from the requirements of this section; or 

(B) converted to performance by a contractor to circumvent 

a civilian personnel ceiling. 

(4) A military department or Defense Agency may not be required to conduct a public-private competition under Office of Management and Budget Circular A–76 or any other provision of law 

at the end of the performance period specified in a letter of obligation or other agreement entered into with Department of Defense 

civilian employees pursuant to a public-private competition for any 

function of the Department of Defense performed by Department of 

Defense civilian employees. 

(5)(A) Except as provided in subparagraph (B), the duration of 

a public-private competition conducted pursuant to Office of Management and Budget Circular A–76 or any other provision of law 

for any function of the Department of Defense performed by Department of Defense civilian employees may not exceed a period of 

24 months, commencing on the date on which the preliminary planning for the public-private competition begins and ending on the 

date on which a performance decision is rendered with respect to 

the function. 

(B)(i) The Secretary of Defense may specify an alternative period of time for a public-private competition, which may not exceed 

33 months, if the Secretary— 

(I) determines that the competition is of such complexity 

that it cannot be completed within 24 months; and 

(II) submits to Congress, as part of the formal congressional notification of a public-private competition pursuant to 

subsection (c), written notification that explains the basis of 

such determination. 
1367 § 2461 CH. 146—CONTRACTING FOR COMMERCIAL / INDUSTRIAL FNS 

(ii) The notification under clause (i)(II) shall also address each 

of the following: 

(I) Any efforts of the Secretary to break up the study geographically or functionally. 

(II) The Secretary’s justification for undertaking a publicprivate competition instead of using internal reengineering alternatives. 

(III) The cost savings that the Secretary expects to achieve 

as a result of the public-private competition. 

(iii) If the Secretary specifies an alternative time period under 

this subparagraph, the alternative time period shall be binding on 

the Department in the same manner and to the same extent as the 

limitation provided in subparagraph (A). 

(C) The time period specified in subparagraph (A) for a publicprivate competition does not include any day during which the public-private competition is delayed by reason of the filing of a protest 

before the Government Accountability Office or a complaint in the 

United States Court of Federal Claims up until the day the decision or recommendation of either authority becomes final. In the 

case of a protest before the Government Accountability Office, the 

recommendation becomes final after the period of time for filing a 

request for reconsideration, or if a request for reconsideration is 

filed, on the day the Government Accountability Office issues a decision on the reconsideration. 

(D) If a protest with respect to a public-private competition before the Government Accountability Office or the United States 

Court of Federal Claims is sustained, and the recommendation is 

final as described in subparagraph (C), and if such protest and recommendation result in an unforeseen delay in implementing a final 

performance decision, the Secretary of Defense may terminate the 

public-private competition or extend the period of time specified for 

the public-private competition under subparagraph (A) or subparagraph (B). If the Secretary decides not to terminate a competition, 

the Secretary shall submit to Congress written notice of such decision. Any such notification shall include a justification for the Secretary’s decision and a new time limitation for the competition, 

which shall not exceed 12 months from the final decision and shall 

be binding on the Department. 

(E) For the purposes of this paragraph, preliminary planning 

with respect to a public-private competition, begins on the date on 

which the Department of Defense obligates funds for the acquisition of contract support, or formally assigns Department of Defense 

personnel, to carry out any of the following activities: 

(i) Determining the scope of the competition. 

(ii) Conducting research to determine the appropriate 

grouping of functions for the competition. 

(iii) Assessing the availability of workload data, quantifiable outputs of functions, and agency or industry performance 

standards applicable to the competition. 

(iv) Determining the baseline cost of any function for 

which the competition is conducted. 

(F) To effectively establish the date that is the first day of preliminary planning for a public-private competition, the head of a 

military department shall submit to Congress written notice of 
§ 2461 CH. 146—CONTRACTING FOR COMMERCIAL / INDUSTRIAL FNS 1368 

such date and shall provide public notice by announcing such date 

on an appropriate Internet website. Such date is the first day of 

preliminary planning for a public-private competition for the purpose of computing the duration of the public private competition for 

purposes of this section. 

(G) The Secretary of Defense shall submit to the congressional 

defense committees an annual report on the use, during the year 

covered by the report, of alternative time periods for public-private 

competitions under this section, and the explanations of the Secretary for such alternative time periods. 

(b) REQUIREMENT TO CONSULT DOD EMPLOYEES.—(1) Each officer or employee of the Department of Defense responsible for determining under Office of Management and Budget Circular A–76 

whether to convert to contractor performance any function of the 

Department of Defense— 

(A) shall, at least monthly during the development and 

preparation of the performance work statement and the management efficiency study used in making that determination, 

consult with civilian employees who will be affected by that determination and consider the views of such employees on the 

development and preparation of that statement and that study; 

and 

(B) may consult with such employees on other matters relating to that determination. 

(2)(A) In the case of employees represented by a labor organization accorded exclusive recognition under section 7111 of title 5, 

consultation with representatives of that labor organization shall 

satisfy the consultation requirement in paragraph (1). 

(B) In the case of employees other than employees referred to 

in subparagraph (A), consultation with appropriate representatives 

of those employees shall satisfy the consultation requirement in 

paragraph (1). 

(C) The Secretary of Defense shall prescribe regulations to 

carry out this subsection. The regulations shall include provisions 

for the selection or designation of appropriate representatives of 

employees referred to in subparagraph (B) for purposes of the consultation required by paragraph (1). 

(c) CONGRESSIONAL NOTIFICATION.—(1) Before commencing a 

public-private competition under subsection (a), the Secretary of 

Defense shall submit to Congress a report containing the following: 

(A) The function for which such public-private competition 

is to be conducted. 

(B) The location at which the function is performed by Department of Defense civilian employees. 

(C) The number of Department of Defense civilian employee positions potentially affected. 

(D) The anticipated length and cost of the public-private 

competition, and a specific identification of the budgetary line 

item from which funds will be used to cover the cost of the 

public-private competition. 

(E) A certification that a proposed performance of the function by a contractor is not a result of a decision by an official 

of a military department or Defense Agency to impose predetermined constraints or limitations on such employees in 
1369 § 2461 CH. 146—CONTRACTING FOR COMMERCIAL / INDUSTRIAL FNS 

terms of man years, end strengths, full-time equivalent positions, or maximum number of employees. 

(2) The report required under paragraph (1) shall include an 

examination of the potential economic effect of performance of the 

function by a contractor on— 

(A) Department of Defense civilian employees who would 

be affected by such a conversion in performance; and 

(B) the local community and the Government, if more than 

50 Department of Defense civilian employees perform the function. 

(3)(A) A representative individual or entity at a facility where 

a public-private competition is conducted may submit to the Secretary of Defense an objection to the public-private competition on 

the grounds that the report required by paragraph (1) has not been 

submitted or that the certification required by paragraph (1)(E) is 

not included in the report submitted as a condition for the publicprivate competition. The objection shall be in writing and shall be 

submitted within 90 days after the following date: 

(i) In the case of a failure to submit the report when required, the date on which the representative individual or an 

official of the representative entity authorized to pose the objection first knew or should have known of that failure. 

(ii) In the case of a failure to include the certification in 

a submitted report, the date on which the report was submitted to Congress. 

(B) If the Secretary determines that the report required by 

paragraph (1) was not submitted or that the required certification 

was not included in the submitted report, the function for which 

the public-private competition was conducted for which the objection was submitted may not be the subject of a solicitation of offers 

for, or award of, a contract until, respectively, the report is submitted or a report containing the certification in full compliance 

with the certification requirement is submitted. 

(d) EXEMPTION FOR THE PURCHASE OF PRODUCTS AND SERVICES

OF THE BLIND AND OTHER SEVERELY HANDICAPPED PERSONS.—This 

section shall not apply to a commercial or industrial type function 

of the Department of Defense that— 

(1) is included on the procurement list established pursuant to section 8503 of title 41; or 

(2) is planned to be changed to performance by a qualified 

nonprofit agency for the blind or by a qualified nonprofit agency for other severely handicapped persons in accordance with 

that Act. 

(e) INAPPLICABILITY DURING WAR OR EMERGENCY.—The provisions of this section shall not apply during war or during a period 

of national emergency declared by the President or Congress. 

(Added Pub. L. 100–370, Sec. 2(a)(1), July 19, 1988, 102 Stat. 851; amended Pub. L. 101–189, 

div. A, title XI, Sec. 1132, Nov. 29, 1989, 103 Stat. 1561; Pub. L. 104–106, div. D, title XLIII, 

Sec. 4321(b)(19), Feb. 10, 1996, 110 Stat. 673; Pub. L. 105–85, div. A, title III, Sec. 384, Nov. 

18, 1997, 111 Stat. 1711; Pub. L. 105–261, div. A, title III, Sec. 342(a)–(c), Oct. 17, 1998, 112 

Stat. 1974; Pub. L. 106–65, div. A, title III, Sec. 341, Oct. 5, 1999, 113 Stat. 568; Pub. L. 106– 

398, Sec. 1 [[div. A], title III, Secs. 351, 352], Oct. 30, 2000, 114 Stat. 1654, 1654A–71, 1654A– 

72; Pub. L. 107–107, div. A, title III, Sec. 344, Dec. 28, 2001, 115 Stat. 1061; Pub. L. 107–314, 

div. A, title III, Sec. 331, Dec. 2, 2002, 116 Stat. 2512; Pub. L. 109–163, div. A, title III, Sec. 

341(a), (b), (c)(2), (3), (g)(1)–(2)(B), Jan. 6, 2006, 119 Stat. 3195, 3196, 3199, 3200; Pub. L. 110– 

181, div. A, title III, Secs. 322(a), (b)(2), (c), 323, Jan. 28, 2008, 122 Stat. 58–60; Pub. L. 111– 
§ 2461a CH. 146—CONTRACTING FOR COMMERCIAL / INDUSTRIAL FNS 1370 

84, div. A, title III, Secs. 321(a), 322(a), title X, Sec. 1073(a)(25), Oct. 28, 2009, 123 Stat. 2250, 

2251, 2474; Pub. L. 111–350, Sec. 5(b)(34), Jan. 4, 2011, 124 Stat. 3845.) 

§ 2461a. Development and implementation of system for 

monitoring cost saving resulting from public-private competitions 

(a) SYSTEM FOR MONITORING PERFORMANCE.—(1) The Secretary 

of Defense shall monitor the performance, including the cost of performance, of each function of the Department of Defense that, after 

the October 30, 2000, is the subject of a public-private competition 

conducted under section 2461 of this title. 

(2) In carrying out paragraph (1), the Secretary shall— 

(A) compare the cost of performing the function before the 

public-private competition to the cost of performing the function after the implementation of the results of the public-private competition; and 

(B) identify any actual savings of the Department of Defense after the implementation of the results of the public-private competition and compare such savings to the estimated 

savings identified pursuant to section 2461(a)(1)(E) of this title 

for that public-private competition; 

(3) The monitoring of a function shall continue under this section for at least five years after the conversion, reorganization, or 

reengineering of the function pursuant to such a public-private 

competition. 

(b) CONSIDERATION IN PREPARATION OF FUTURE-YEARS DEFENSE PROGRAM.—In preparing the future-years defense program 

under section 221 of this title, the Secretary of Defense shall, for 

the fiscal years covered by the program, estimate and take into account the costs to be incurred and the savings to be derived from 

the performance of functions by workforces selected in public-private competitions conducted under section 2461 of this title. The 

Secretary shall consider the results of the monitoring under this 

section in making the estimates. 

(Added Pub. L. 106–398, Sec. 1 [[div. A], title III, Sec. 354(a)], Oct. 30, 2000, 114 Stat. 1654, 

1654A–73; amended Pub. L. 107–107, div. A, title X, Sec. 1048(a)(21), (c)(11), Dec. 28, 2001, 115 

Stat. 1224, 1226; Pub. L. 109–163, div. A, title III, Sec. 341(d), (g)(2)(C), Jan. 6, 2006, 119 Stat. 

3199, 3200.) 

§ 2462. Reports on public-private competition 

(a) REPORT ON PUBLIC-PRIVATE COMPETITION RESULTS.—(1) 

Upon the completion of a public-private competition under section 

2461 of this title, the Secretary of Defense shall submit to Congress 

a report containing the results of the public-private competition required by subsection (a) of such section. 

(2) Each report under this subsection shall include the following: 

(A) The date on which the public-private competition was 

commenced. 

(B) The number of Department of Defense civilian employees who were performing the function when the public-private 

competition was commenced and the number of such employees 

whose employment was or will be terminated or otherwise affected by converting to performance of the function by a con-
1371 § 2462 CH. 146—CONTRACTING FOR COMMERCIAL / INDUSTRIAL FNS 

tractor or by implementation of the most efficient organization 

of the function. 

(C) The Secretary’s certification that the Government’s calculation of the cost of performance of the function by Department of Defense civilian employees is based on an estimate of 

the most cost effective manner for performance of the function 

by Department of Defense civilian employees that meets the 

needs of the Department with respect to factors other than 

cost, including quality and reliability. 

(D) The Secretary’s certification that the public-private 

competition did not include any predetermined personnel constraint or limitation in terms of man years, end strength, fulltime equivalent positions, or maximum number of employees. 

(E) The Secretary’s certification that the entire public-private competition is available for examination. 

(F) In the case of a function performed at a Center of Industrial and Technical Excellence designated under section 

2474(a) of this title or an Army ammunition plant, a description of the effect that the manner of performance of the function, and administration of the resulting contract if any, will 

have on the overhead costs of the center or ammunition plant, 

as the case may be. 

(G) A schedule for implementing the results of the publicprivate competition. 

(3)(A) No decision made on the basis of a public-private competition under section 2461 of this title may be implemented until 

after the submission of a report under paragraph (1). 

(B) Notwithstanding subparagraph (A), in the case of function 

performed at a Center of Industrial and Technical Excellence designated under section 2474(a) of this title or an Army ammunition 

plant, the conversion of the function to performance by a contractor 

may not begin until at least 60 days after the submission of a report under paragraph (1). 

(b) ANNUAL REPORT.—Not later than June 30 of each year, the 

Secretary of Defense shall submit to Congress a written report, 

which shall include the following: 

(1) An estimate of the percentage of functions (other than 

functions that are inherently governmental) that Department 

of Defense civilian employees will perform and an estimate of 

the percentage of such functions that contractors will perform 

during the fiscal year during which the report is submitted. 

(2) The results of public-private competitions conducted 

under section 2461 of this title that were completed during the 

preceding fiscal year, including each of the following: 

(A) The number of such competitions completed during 

such fiscal year and the number of Department of Defense 

civilian employees performing functions for which such a 

competition was conducted. 

(B) The percentage of such competitions that resulted 

in the continued performance of a function by Department 

of Defense civilian employees. 

(C) The percentage of such competitions that resulted 

in the conversion of a function to performance by a contractor. 
§ 2463 CH. 146—CONTRACTING FOR COMMERCIAL / INDUSTRIAL FNS 1372 

(D) The percentage of the Department of Defense civilian employees identified pursuant to subparagraph (A) 

whose positions will be converted to performance by contractors or eliminated as a result of implementing the results of such competitions. 

(3) The results of monitoring the performance of Department functions under section 2461a of this title, including for 

each function subject to monitoring, each of the following: 

(A) The cost of the public-private competition conducted under section 2461 of this title. 

(B) The cost of performing the function before such 

competition compared to the costs incurred after implementing the conversion, reorganization, or reengineering 

actions recommended pursuant to the competition. 

(C) The actual savings derived from the implementation of the recommendations made pursuant to such competition, if any, compared to the anticipated savings that 

were to result from the conversion, reorganization, or reengineering actions. 

(Added Pub. L. 100–370, Sec. 2(a)(1), July 19, 1988, 102 Stat. 853; amended Pub. L. 109–163, 

div. A, title III, Sec. 341(c)(1), Jan. 6, 2006, 119 Stat. 3197.) 

§ 2463. Guidelines and procedures for use of civilian employees to perform Department of Defense functions 

(a) GUIDELINES REQUIRED.—(1) The Under Secretary of Defense for Personnel and Readiness shall devise and implement 

guidelines and procedures to ensure that consideration is given to 

using, on a regular basis, Department of Defense civilian employees to perform new functions and functions that are performed by 

contractors and could be performed by Department of Defense civilian employees. The Secretary of a military department may prescribe supplemental regulations, if the Secretary determines such 

regulations are necessary for implementing such guidelines within 

that military department. 

(2) The guidelines and procedures required under paragraph 

(1) may not include any specific limitation or restriction on the 

number of functions or activities that may be converted to performance by Department of Defense civilian employees. 

(b) SPECIAL CONSIDERATION FOR CERTAIN FUNCTIONS.—The 

guidelines and procedures required under subsection (a) shall provide for special consideration to be given to using Department of 

Defense civilian employees to perform any function that— 

(1) is performed by a contractor and— 

(A) has been performed by Department of Defense civilian employees at any time during the previous 10 years; 

(B) is a function closely associated with the performance of an inherently governmental function; 

(C) has been performed pursuant to a contract awarded on a non-competitive basis; or 

(D) has been performed poorly, as determined by a 

contracting officer during the 5-year period preceding the 

date of such determination, because of excessive costs or 

inferior quality; or 
1373 § 2464 CH. 146—CONTRACTING FOR COMMERCIAL / INDUSTRIAL FNS 

(2) is a new requirement, with particular emphasis given 

to a new requirement that is similar to a function previously 

performed by Department of Defense civilian employees or is 

a function closely associated with the performance of an inherently governmental function. 

(c) EXCLUSION OF CERTAIN FUNCTIONS FROM COMPETITIONS.— 

The Secretary of Defense may not conduct a public-private competition under this chapter, Office of Management and Budget Circular 

A–76, or any other provision of law or regulation before— 

(1) in the case of a new Department of Defense function, 

assigning the performance of the function to Department of Defense civilian employees; 

(2) in the case of any Department of Defense function described in subsection (b), converting the function to performance by Department of Defense civilian employees; or 

(3) in the case of a Department of Defense function performed by Department of Defense civilian employees, expanding the scope of the function. 

(d) USE OF FLEXIBLE HIRING AUTHORITY.—(1) The Secretary of 

Defense may use the flexible hiring authority available to the Secretary pursuant to section 9902 of title 5, to facilitate the performance by Department of Defense civilian employees of functions described in subsection (b). 

(2) The Secretary shall make use of the inventory required by 

section 2330a(c) of this title for the purpose of identifying functions 

that should be considered for performance by Department of Defense civilian employees pursuant to subsection (b). 

(e) DEFINITIONS.—In this section the term ‘‘functions closely associated with inherently governmental functions’’ has the meaning 

given that term in section 2383(b)(3) of this title. 

(Added Pub. L. 110–181, div. A, title III, Sec. 324(a)(1), Jan. 28, 2008, 122 Stat. 60; amended 

Pub. L. 111–383, div. A, title III, Sec. 353, Jan. 7, 2011, 124 Stat. 4194.) 

§ 2464. Core logistics capabilities 

(a) NECESSITY FOR CORE LOGISTICS CAPABILITIES.—(1) It is essential for the national defense that the Department of Defense 

maintain a core logistics capability that is Government-owned and 

Government-operated (including Government personnel and Government-owned and Government-operated equipment and facilities) 

to ensure a ready and controlled source of technical competence 

and resources necessary to ensure effective and timely response to 

a mobilization, national defense contingency situations, and other 

emergency requirements. 

(2) The Secretary of Defense shall identify the core logistics capabilities described in paragraph (1) and the workload required to 

maintain those capabilities. 

(3) The core logistics capabilities identified under paragraphs 

(1) and (2) shall include those capabilities that are necessary to 

maintain and repair the weapon systems and other military equipment (including mission-essential weapon systems or materiel not 

later than four years after achieving initial operational capability, 

but excluding systems and equipment under special access programs, nuclear aircraft carriers, and commercial items described in 

paragraph (5)) that are identified by the Secretary, in consultation 
§ 2464 CH. 146—CONTRACTING FOR COMMERCIAL / INDUSTRIAL FNS 1374 

with the Chairman of the Joint Chiefs of Staff, as necessary to enable the armed forces to fulfill the strategic and contingency plans 

prepared by the Chairman of the Joint Chiefs of Staff under section 

153(a) of this title. 

(4) The Secretary of Defense shall require the performance of 

core logistics workloads necessary to maintain the core logistics capabilities identified under paragraphs (1), (2), and (3) at Government-owned, Government-operated facilities of the Department of 

Defense (including Government-owned, Government-operated facilities of a military department) and shall assign such facilities sufficient workload to ensure cost efficiency and technical competence 

in peacetime while preserving the surge capacity and reconstitution 

capabilities necessary to support fully the strategic and contingency 

plans referred to in paragraph (3). 

(5) The commercial items covered by paragraph (3) are commercial items that have been sold or leased in substantial quantities to the general public and are purchased without modification 

in the same form that they are sold in the commercial marketplace, 

or with minor modifications to meet Federal Government requirements. 

(b) LIMITATION ON CONTRACTING.—(1) Except as provided in 

paragraph (2), performance of workload needed to maintain a logistics capability identified by the Secretary under subsection (a)(2) 

may not be contracted for performance by non-Government personnel under the procedures and requirements of Office of Management and Budget Circular A–76 or any successor administrative 

regulation or policy (hereinafter in this section referred to as OMB 

Circular A–76). 

(2) The Secretary of Defense may waive paragraph (1) in the 

case of any such logistics capability and provide that performance 

of the workload needed to maintain that capability shall be considered for conversion to contractor performance in accordance with 

OMB Circular A–76. Any such waiver shall be made under regulations prescribed by the Secretary and shall be based on a determination by the Secretary that Government performance of the 

workload is no longer required for national defense reasons. Such 

regulations shall include criteria for determining whether Government performance of any such workload is no longer required for 

national defense reasons. 

(3)(A) A waiver under paragraph (2) may not take effect until 

the expiration of the first period of 30 days of continuous session 

of Congress that begins on or after the date on which the Secretary 

submits a report on the waiver to the Committee on Armed Services and the Committee on Appropriations of the Senate and the 

Committee on Armed Services and the Committee on Appropriations of the House of Representatives. 

(B) For the purposes of subparagraph (A)— 

(i) continuity of session is broken only by an adjournment 

of Congress sine die; and 

(ii) the days on which either House is not in session because of an adjournment of more than three days to a day certain are excluded in the computation of any period of time in 

which Congress is in continuous session. 
1375 § 2465 CH. 146—CONTRACTING FOR COMMERCIAL / INDUSTRIAL FNS 

(c) NOTIFICATION OF DETERMINATIONS REGARDING CERTAIN

COMMERCIAL ITEMS.—The first time that a weapon system or other 

item of military equipment described in subsection (a)(3) is determined to be a commercial item for the purposes of the exception 

contained in that subsection, the Secretary of Defense shall submit 

to Congress a notification of the determination, together with the 

justification for the determination. The justification for the determination shall include, at a minimum, the following: 

(1) The estimated percentage of commonality of parts of 

the version of the item that is sold or leased in the commercial 

marketplace and the Government’s version of the item. 

(2) The value of any unique support and test equipment 

and tools that are necessary to support the military requirements if the item were maintained by the Government. 

(3) A comparison of the estimated life cycle logistics support costs that would be incurred by the Government if the 

item were maintained by the private sector with the estimated 

life cycle logistics support costs that would be incurred by the 

Government if the item were maintained by the Government. 

(Added Pub. L. 100–370, Sec. 2(a)(1), July 19, 1988, 102 Stat. 853; amended Pub. L. 101–189, 

div. A, title XVI, Sec. 1622(c)(7), Nov. 29, 1989, 103 Stat. 1604; Pub. L. 104–106, div. A, title 

III, Sec. 314, Feb. 10, 1996, 110 Stat. 251; Pub. L. 105–85, div. A, title III, Sec. 356(a), Nov. 

18, 1997, 111 Stat. 1694; Pub. L. 105–261, div. A, title III, Sec. 343(a), Oct. 17, 1998, 112 Stat. 

1976; Pub. L. 106–65, div. A, title X, Sec. 1067(1), Oct. 5, 1999, 113 Stat. 774.) 

§ 2465. Prohibition on contracts for performance of firefighting or security-guard functions 

(a) Except as provided in subsection (b), funds appropriated to 

the Department of Defense may not be obligated or expended for 

the purpose of entering into a contract for the performance of firefighting or security-guard functions at any military installation or 

facility. 

(b) The prohibition in subsection (a) does not apply to the following contracts: 

(1) A contract to be carried out at a location outside the 

United States (including its commonwealths, territories, and 

possessions) at which members of the armed forces would have 

to be used for the performance of a function described in subsection (a) at the expense of unit readiness. 

(2) A contract to be carried out on a Government-owned 

but privately operated installation. 

(3) A contract (or the renewal of a contract) for the performance of a function under contract on September 24, 1983. 

(4) A contract for the performance of firefighting functions 

if the contract is— 

(A) for a period of one year or less; and 

(B) covers only the performance of firefighting functions that, in the absence of the contract, would have to be 

performed by members of the armed forces who are not 

readily available to perform such functions by reason of a 

deployment. 

(Added Pub. L. 99–661, div. A, title XII, Sec. 1222(a)(1), Nov. 14, 1986, 100 Stat. 3976, Sec. 

2693; amended Pub. L. 100–180, div. A, title XI, Sec. 1112(a)–(b)(2), Dec. 4, 1987, 101 Stat. 

1147; renumbered Sec. 2465, Pub. L. 100–370, Sec. 2(b)(1), July 19, 1988, 102 Stat. 854; Pub. 

L. 104–106, div. A, title XV, Sec. 1502(a)(25), Feb. 10, 1996, 110 Stat. 512; Pub. L. 108–136, 

div. A, title III, Sec. 331, Nov. 24, 2003, 117 Stat. 1442.) 
§ 2466 CH. 146—CONTRACTING FOR COMMERCIAL / INDUSTRIAL FNS 1376 

§ 2466. Limitations on the performance of depot-level maintenance of materiel 

(a) PERCENTAGE LIMITATION.—Not more than 50 percent of the 

funds made available in a fiscal year to a military department or 

a Defense Agency for depot-level maintenance and repair workload 

may be used to contract for the performance by non-Federal Government personnel of such workload for the military department or 

the Defense Agency. Any such funds that are not used for such a 

contract shall be used for the performance of depot-level maintenance and repair workload by employees of the Department of Defense. 

(b) WAIVER OF LIMITATION.—The Secretary of Defense may 

waive the limitation in subsection (a) for a fiscal year if— 

(1) the Secretary determines that the waiver is necessary 

for reasons of national security; and 

(2) the Secretary submits to Congress a notification of the 

waiver together with the reasons for the waiver. 

(c) PROHIBITION ON DELEGATION OF WAIVER AUTHORITY.—The 

authority to grant a waiver under subsection (b) may not be delegated. 

(d) ANNUAL REPORT.—(1) Not later than 90 days after the date 

on which the budget of the President for a fiscal year is submitted 

to Congress pursuant to section 1105 of title 31, the Secretary of 

Defense shall submit to Congress a report identifying, for each of 

the armed forces (other than the Coast Guard) and each Defense 

Agency, the percentage of the funds referred to in subsection (a) 

that was expended during the preceding fiscal year, and are projected to be expended during the current fiscal year and the ensuing fiscal year, for performance of depot-level maintenance and repair workloads by the public and private sectors. 

(2) Each report required under paragraph (1) shall include as 

a separate item any expenditure covered by section 2474(f) of this 

title that was made during the fiscal year covered by the report 

and shall specify the amount and nature of each such expenditure. 

(Added Pub. L. 100–456, div. A, title III, Sec. 326(a), Sept. 29, 1988, 102 Stat. 1955; amended 

Pub. L. 101–189, div. A, title III, Sec. 313, Nov. 29, 1989, 103 Stat. 1412; Pub. L. 102–190, div. 

A, title III, Sec. 314(a)(1), Dec. 5, 1991, 105 Stat. 1336; Pub. L. 102–484, div. A, title III, Sec. 

352(a)–(c), Oct. 23, 1992, 106 Stat. 2378; Pub. L. 103–337, div. A, title III, Sec. 332, Oct. 5, 1994, 

108 Stat. 2715; Pub. L. 104–106, div. A, title III, Secs. 311(f)(1), 312(b), Feb. 10, 1996, 110 Stat. 

248, 250; Pub. L. 105–85, div. A, title III, Secs. 357, 358, 363, Nov. 18, 1997, 111 Stat. 1695, 

1702; Pub. L. 106–65, div. A, title III, Sec. 333, Oct. 5, 1999, 113 Stat. 567; Pub. L. 107–107, 

div. A, title III, Sec. 341, Dec. 28, 2001, 115 Stat. 1060; Pub. L. 108–136, div. A, title III, Sec. 

332, Nov. 24, 2003, 117 Stat. 1442; Pub. L. 108–375, div. A, title III, Sec. 321, Oct. 28, 2004, 

118 Stat. 1845; Pub. L. 109–364, div. A, title III, Sec. 331(b), Oct. 17, 2006, 120 Stat. 2149; Pub. 

L. 111–84, div. A, title III, Sec. 329, Oct. 28, 2009, 123 Stat. 2256.) 

[§ 2467. Repealed. Pub. L. 110–181, div. A, title III, Sec. 

322(b)(1), Jan. 28, 2008, 122 Stat. 59] 

[§ 2468. Repealed. Pub. L. 107–107, div. A, title X, Sec. 

1048(e)(10)(A), Dec. 28, 2001, 115 Stat. 1228] 

§ 2469. Contracts to perform workloads previously performed by depot-level activities of the Department 

of Defense: requirement of competition 

(a) REQUIREMENT FOR COMPETITION.—The Secretary of Defense 

shall ensure that the performance of a depot-level maintenance and 
1377 § 2472 CH. 146—CONTRACTING FOR COMMERCIAL / INDUSTRIAL FNS 

repair workload described in subsection (b) is not changed to performance by a contractor or by another depot-level activity of the 

Department of Defense unless the change is made using— 

(1) merit-based selection procedures for competitions 

among all depot-level activities of the Department of Defense; 

or 

(2) competitive procedures for competitions among private 

and public sector entities. 

(b) SCOPE.—Except as provided in subsection (c), subsection (a) 

applies to any depot-level maintenance and repair workload that 

has a value of not less than $3,000,000 (including the cost of labor 

and materials) and is being performed by a depot-level activity of 

the Department of Defense. 

(c) EXCEPTION FOR PUBLIC-PRIVATE PARTNERSHIPS.—The requirements of subsection (a) may be waived in the case of a depotlevel maintenance and repair workload that is performed at a Center of Industrial and Technical Excellence designated under subsection (a) of section 2474 of this title by a public-private partnership entered into under subsection (b) of such section consisting of 

a depot-level activity and a private entity. 

(d) INAPPLICABILITY OF OMB CIRCULAR A–76.—Office of Management and Budget Circular A–76 (or any successor administrative regulation or policy) does not apply to a performance change 

to which subsection (a) applies. 

(Added Pub. L. 102–484, div. A, title III, Sec. 353(a), Oct. 23, 1992, 106 Stat. 2378; amended 

Pub. L. 103–160, div. A, title III, Sec. 346, title XI, Sec. 1182(a)(7), Nov. 30, 1993, 107 Stat. 

1625, 1771; Pub. L. 103–337, div. A, title III, Sec. 338, Oct. 5, 1994, 108 Stat. 2718; Pub. L. 

104–106, div. A, title III, Sec. 311(f)(1), Feb. 10, 1996, 110 Stat. 248; Pub. L. 105–85, div. A, 

title III, Secs. 355(b), 363, Nov. 18, 1997, 111 Stat. 1694, 1702; Pub. L. 106–65, div. A, title 

III, Sec. 334, Oct. 5, 1999, 113 Stat. 568; Pub. L. 108–136, div. A, title III, Sec. 333, Nov. 24, 

2003, 117 Stat. 1442.) 

[§ 2469a. Repealed. Pub. L. 107–314, title III, Sec. 333(a), Dec. 

2, 2002, 116 Stat. 2514] 

§ 2470. Depot-level activities of the Department of Defense: 

authority to compete for maintenance and repair 

workloads of other Federal agencies 

A depot-level activity of the Department of Defense shall be eligible to compete for the performance of any depot-level maintenance and repair workload of a Federal agency for which competitive procedures are used to select the entity to perform the workload. 

(Added Pub. L. 103–337, div. A, title III, Sec. 335(a), Oct. 5, 1994, 108 Stat. 2716.) 

[§ 2471. Repealed. Pub. L. 106–398, Sec. 1 [[div. A], title III, 

Sec. 341(g)(1)], Oct. 30, 2000, 114 Stat. 1654, 1654A– 

64] 

§ 2472. Prohibition on management of depot employees by 

end strength 

The civilian employees of the Department of Defense, including 

the civilian employees of the military departments and the Defense 

Agencies, who perform, or are involved in the performance of, 

depot-level maintenance and repair workloads may not be managed 

on the basis of any constraint or limitation in terms of man years, 
[§ 2473 CH. 146—CONTRACTING FOR COMMERCIAL / INDUSTRIAL FNS 1378 

end strength, full-time equivalent positions, or maximum number 

of employees. Such employees shall be managed solely on the basis 

of the available workload and the funds made available for such 

depot-level maintenance and repair. 

(Added and amended Pub. L. 104–106, div. A, title III, Sec. 312(a), (b), Feb. 10, 1996, 110 Stat. 

250; Pub. L. 105–85, div. A, title III, Sec. 360, Nov. 18, 1997, 111 Stat. 1700; Pub. L. 106–65, 

div. A, title X, Sec. 1067(1), Oct. 5, 1999, 113 Stat. 774; Pub. L. 108–375, div. A, title III, Sec. 

322(a), (b)(1), Oct. 28, 2004, 118 Stat. 1846.) 

[§ 2473. Repealed. Pub. L. 111–383, div. A, title VIII, Sec. 

822(a), Jan. 7, 2011, 124 Stat. 4268] 

§ 2474. Centers of Industrial and Technical Excellence: designation; public-private partnerships 

(a) DESIGNATION.—(1) The Secretary concerned, or the Secretary of Defense in the case of a Defense Agency, shall designate 

each depot-level activity of the military departments and the Defense Agencies (other than facilities approved for closure or major 

realignment under the Defense Base Closure and Realignment Act 

of 1990 (part A of title XXIX of Public Law 101–510; 10 U.S.C. 

2687 note)) as a Center of Industrial and Technical Excellence in 

the recognized core competencies of the designee. 

(2) The Secretary of Defense shall establish a policy to encourage the Secretary of each military department and the head of each 

Defense Agency to reengineer industrial processes and adopt bestbusiness practices at their Centers of Industrial and Technical Excellence in connection with their core competency requirements, so 

as to serve as recognized leaders in their core competencies 

throughout the Department of Defense and in the national technology and industrial base (as defined in section 2500(1) of this 

title). 

(3) The Secretary of a military department may conduct a pilot 

program, consistent with applicable requirements of law, to test 

any practices referred to in paragraph (2) that the Secretary determines could improve the efficiency and effectiveness of operations 

at Centers of Industrial and Technical Excellence, improve the support provided by the Centers for the armed forces user of the services of the Centers, and enhance readiness by reducing the time 

that it takes to repair equipment. 

(b) PUBLIC-PRIVATE PARTNERSHIPS.—(1) To achieve one or more 

objectives set forth in paragraph (2), the Secretary designating a 

Center of Industrial and Technical Excellence under subsection (a) 

may authorize and encourage the head of the Center to enter into 

public-private cooperative arrangements (in this section referred to 

as a ‘‘public-private partnership’’) to provide for any of the following: 

(A) For employees of the Center, private industry, or other 

entities outside the Department of Defense to perform (under 

contract, subcontract, or otherwise) work related to the core 

competencies of the Center, including any depot-level maintenance and repair work that involves one or more core competencies of the Center. 

(B) For private industry or other entities outside the Department of Defense to use, for any period of time determined 

to be consistent with the needs of the Department of Defense, 
1379 § 2474 CH. 146—CONTRACTING FOR COMMERCIAL / INDUSTRIAL FNS 

any facilities or equipment of the Center that are not fully utilized for a military department’s own production or maintenance requirements. 

(2) The objectives for exercising the authority provided in paragraph (1) are as follows: 

(A) To maximize the utilization of the capacity of a Center 

of Industrial and Technical Excellence. 

(B) To reduce or eliminate the cost of ownership of a Center by the Department of Defense in such areas of responsibility as operations and maintenance and environmental remediation. 

(C) To reduce the cost of products of the Department of Defense produced or maintained at a Center. 

(D) To leverage private sector investment in— 

(i) such efforts as plant and equipment recapitalization 

for a Center; and 

(ii) the promotion of the undertaking of commercial 

business ventures at a Center. 

(E) To foster cooperation between the armed forces and 

private industry. 

(3) If the Secretary concerned, or the Secretary of Defense in 

the case of a Defense Agency, authorizes the use of public-private 

partnerships under this subsection, the Secretary shall submit to 

Congress a report evaluating the need for loan guarantee authority, similar to the ARMS Initiative loan guarantee program under 

section 4555 of this title, to facilitate the establishment of publicprivate partnerships and the achievement of the objectives set forth 

in paragraph (2). 

(c) PRIVATE SECTOR USE OF EXCESS CAPACITY.—Any facilities 

or equipment of a Center of Industrial and Technical Excellence 

made available to private industry may be used to perform maintenance or to produce goods in order to make more efficient and economical use of Government-owned industrial plants and encourage 

the creation and preservation of jobs to ensure the availability of 

a workforce with the necessary manufacturing and maintenance 

skills to meet the needs of the armed forces. 

(d) CREDITING OF AMOUNTS FOR PERFORMANCE.—Amounts received by a Center for work performed under a public-private partnership shall be credited to the appropriation or fund, including a 

working-capital fund, that incurs the cost of performing the work. 

Consideration in the form of rental payments or (notwithstanding 

section 3302(b) of title 31) in other forms may be accepted for a use 

of property accountable under a contract performed pursuant to 

this section. Notwithstanding section 2667(d) of this title, revenues 

generated pursuant to this section shall be available for facility operations, maintenance, and environmental restoration at the Center where the leased property is located. 

(e) AVAILABILITY OF EXCESS EQUIPMENT TO PRIVATE-SECTOR

PARTNERS.—Equipment or facilities of a Center of Industrial and 

Technical Excellence may be made available for use by a privatesector entity under this section only if— 

(1) the use of the equipment or facilities will not have a 

significant adverse effect on the readiness of the armed forces, 
§ 2475 CH. 146—CONTRACTING FOR COMMERCIAL / INDUSTRIAL FNS 1380 

as determined by the Secretary concerned or, in the case of a 

Center in a Defense Agency, by the Secretary of Defense; and 

(2) the private-sector entity agrees— 

(A) to reimburse the Department of Defense for the direct and indirect costs (including any rental costs) that are 

attributable to the entity’s use of the equipment or facilities, as determined by that Secretary; and 

(B) to hold harmless and indemnify the United States 

from— 

(i) any claim for damages or injury to any person 

or property arising out of the use of the equipment or 

facilities, except under the circumstances described in 

section 2563(c)(3) of this title; and 

(ii) any liability or claim for damages or injury to 

any person or property arising out of a decision by the 

Secretary concerned or the Secretary of Defense to 

suspend or terminate that use of equipment or facilities during a war or national emergency. 

(f) EXCLUSION OF CERTAIN EXPENDITURES FROM PERCENTAGE

LIMITATION.—Amounts expended for the performance of a depotlevel maintenance and repair workload by non-Federal Government 

personnel at a Center of Industrial and Technical Excellence under 

any contract shall not be counted for purposes of applying the percentage limitation in section 2466(a) of this title if the personnel 

are provided by private industry or other entities outside the Department of Defense pursuant to a public-private partnership. 

(g) CONSTRUCTION OF PROVISION.—Nothing in this section may 

be construed to authorize a change, otherwise prohibited by law, 

from the performance of work at a Center of Industrial and Technical Excellence by Department of Defense personnel to performance by a contractor. 

(Added Pub. L. 105–85, div. A, title III, Sec. 361(a), Nov. 18, 1997, 111 Stat. 1700; amended 

Pub. L. 106–398, Sec. 1 [[div. A, title III, Sec. 341(a)–(e)], Oct. 30, 2000, 114 Stat. 1654, 1654A– 

61 to 1654A–63; Pub. L. 107–107, div. A, title III, Secs. 342, 343(b), Dec. 28, 2001, 115 Stat. 

1060, 1061; Pub. L. 107–314, div. A, title III, Sec. 334, Dec. 2, 2002, 116 Stat. 2514; Pub. L. 

108–375, div. A, title III, Sec. 323, title X, Sec. 1084(d)(20), Oct. 28, 2004, 118 Stat. 1846, 2062; 

Pub. L. 109–364, div. A, title III, Sec. 331(a), Oct. 17, 2006, 120 Stat. 2149.) 

§ 2475. Consolidation, restructuring, or reengineering of organizations, functions, or activities: notification requirements 

(a) REQUIREMENT TO SUBMIT PLAN ANNUALLY.—Concurrently 

with the submission of the President’s annual budget request 

under section 1105 of title 31, the Secretary of Defense shall submit to Congress each Strategic Sourcing Plan of Action for the Department of Defense (as identified in the Department of Defense 

Interim Guidance dated February 29, 2000, or any successor Department of Defense guidance or directive), for the following year. 

(b) NOTIFICATION OF DECISION TO EXECUTE PLAN.—If a decision is made to consolidate, restructure, or reengineer an organization, function, or activity of the Department of Defense pursuant to 

a Strategic Sourcing Plan of Action described in subsection (a), and 

such consolidation, restructuring, or reengineering would result in 

a manpower reduction affecting 50 or more personnel of the Department of Defense (including military and civilian personnel)— 
1381 § 2476 CH. 146—CONTRACTING FOR COMMERCIAL / INDUSTRIAL FNS 

(1) the Secretary of Defense shall submit to the Committees on Armed Services of the Senate and the House of Representatives a report describing that decision, including— 

(A) a projection of the savings that will be realized as 

a result of the consolidation, restructuring, or reengineering, compared with the cost incurred by the Department of Defense to perform the function or to operate 

the organization or activity prior to such proposed consolidation, restructuring, or reengineering; 

(B) a description of all missions, duties, or military requirements that will be affected as a result of the decision 

to consolidate, restructure, or reengineer the organization, 

function, or activity that was analyzed; 

(C) the Secretary’s certification that the consolidation, 

restructuring, or reengineering will not result in any diminution of military readiness; 

(D) a schedule for performing the consolidation, restructuring, or reengineering; and 

(E) the Secretary’s certification that the entire analysis for the consolidation, restructuring, or reengineering 

is available for examination; and 

(2) the head of the Defense Agency or the Secretary of the 

military department concerned may not implement the plan 

until 30 days after the date that the agency head or Secretary 

submits notification to the Committees on Armed Services of 

the Senate and House of Representatives of the intent to carry 

out such plan. 

(Added Pub. L. 106–398, Sec. 1 [[div. A], title III, Sec. 353(a)], Oct. 30, 2000, 114 Stat. 1654, 

1654A–72.) 

§ 2476. Minimum capital investment for certain depots 

(a) MINIMUM INVESTMENT.—Each fiscal year, the Secretary of 

a military department shall invest in the capital budgets of the covered depots of that military department a total amount equal to not 

less than six percent of the average total combined workload funded at all the depots of that military department for the preceding 

three fiscal years. 

(b) CAPITAL BUDGET.—For purposes of this section, the capital 

budget of a depot includes investment funds spent on depot infrastructure, equipment, and process improvement in direct support of 

depot operations. 

(c) WAIVER.—The Secretary of Defense may waive the requirement under subsection (a) with respect to a military department 

for a fiscal year if the Secretary determines that the waiver is necessary for reasons of national security. Whenever the Secretary 

makes such a waiver, the Secretary shall notify the congressional 

defense committees of the waiver and the reasons for the waiver. 

(d) ANNUAL REPORT.—(1) Not later than 45 days after the date 

on which the President submits to Congress the budget for a fiscal 

year under section 1105 of title 31, the Secretary of Defense shall 

submit to the congressional defense committees a report containing 

budget justification documents summarizing the level of capital investment for each military department as of the end of the preceding fiscal year. 
§ 2476 CH. 146—CONTRACTING FOR COMMERCIAL / INDUSTRIAL FNS 1382 

(2) Each report submitted under paragraph (1) shall include 

the following: 

(A) A specification of any statutory, regulatory, or operational impediments to achieving the requirement under subsection (a) with respect to each military department. 

(B) A description of the benchmarks for capital investment 

established for each covered depot and military department 

and the relationship of the benchmarks to applicable performance measurement methods used in the private sector. 

(C) If the requirement under subsection (a) is not met for 

a military department for the fiscal year covered by the report, 

a statement of the reasons why the requirement was not met 

and a plan of actions for meeting the requirement for the fiscal 

year beginning in the year in which such report is submitted. 

(D) Separate consideration and reporting of Navy depots 

and Marine Corps depots. 

(e) COVERED DEPOT.—In this section, the term ‘‘covered depot’’ 

means any of the following: 

(1) With respect to the Department of the Army: 

(A) Anniston Army Depot, Alabama. 

(B) Letterkenny Army Depot, Pennsylvania. 

(C) Tobyhanna Army Depot, Pennsylvania. 

(D) Corpus Christi Army Depot, Texas. 

(E) Red River Army Depot, Texas. 

(F) Watervliet Arsenal, New York. 

(G) Rock Island Arsenal, Illinois. 

(H) Pine Bluff Arsenal, Arkansas. 

(2) With respect to the Department of the Navy: 

(A) The following Navy depots: 

(i) Fleet Readiness Center East Site, Cherry Point, 

North Carolina. 

(ii) Fleet Readiness Center Southwest Site, North 

Island, California. 

(iii) Fleet Readiness Center Southeast Site, Jacksonville, Florida. 

(iv) Portsmouth Naval Shipyard, Maine. 

(v) Pearl Harbor Naval Shipyard, Hawaii. 

(vi) Puget Sound Naval Shipyard, Washington. 

(vii) Norfolk Naval Shipyard, Virginia. 

(B) The following Marine Corps depots: 

(i) Marine Corps Logistics Base, Albany, Georgia. 

(ii) Marine Corps Logistics Base, Barstow, California. 

(3) With respect to the Department of the Air Force: 

(A) Warner-Robins Air Logistics Center, Georgia. 

(B) Ogden Air Logistics Center, Utah. 

(C) Oklahoma City Air Logistics Center, Oklahoma. 

(Added Pub. L. 109–364, div. A, title III, Sec. 332(a), Oct. 17, 2006, 120 Stat. 2149; amended 

Pub. L. 110–417, [div. A], title III, Sec. 327, Oct. 14, 2008, 122 Stat. 4418; Pub. L. 111–383, 

div. A, title X, Sec. 1075(b)(36), Jan. 7, 2011, 124 Stat. 4371.) 
1383 

CHAPTER 147—COMMISSARIES AND EXCHANGES AND 

OTHER MORALE, WELFARE, AND RECREATION ACTIVITIES 

Subchapter Sec. 

I. Defense Commissary and Exchange Systems .......................................... 2481 

II. Relationship, Continuation, and Common Policies of Defense Commissary and Exchange Systems ............................................................ 2487 

III. Morale, Welfare, and Recreation Programs and Nonappropriated 

Fund Instrumentalities .......................................................................... 2491 

SUBCHAPTER I—DEFENSE COMMISSARY AND EXCHANGE 

SYSTEMS 

Sec. 

2481. Defense commissary and exchange systems: existence and purpose. 

2482. Commissary stores: criteria for establishment or closure; store size. 

2483. Commissary stores: use of appropriated funds to cover operating expenses. 

2484. Commissary stores: merchandise that may be sold; uniform surcharges 

and pricing. 

2485. Commissary stores: operation. 

§ 2481. Defense commissary and exchange systems: existence and purpose 

(a) SEPARATE SYSTEMS.—The Secretary of Defense shall operate, in the manner provided by this chapter and other provisions 

of law, a world-wide system of commissary stores and a separate 

world-wide system of exchange stores. The stores of each system 

may sell, at reduced prices, food and other merchandise to members of the uniformed services on active duty, members of the uniformed services entitled to retired pay, dependents of such members, and persons authorized to use the system under chapter 54 

of this title. 

(b) PURPOSE OF SYSTEMS.—The defense commissary system 

and the exchange system are intended to enhance the quality of life 

of members of the uniformed services, retired members, and dependents of such members, and to support military readiness, recruitment, and retention. 

(c) OVERSIGHT.—(1) The Secretary of Defense shall designate a 

senior official of the Department of Defense to oversee the operation of both the defense commissary system and the exchange system. 

(2) The Secretary of Defense shall establish an executive governing body to provide advice to the senior official designated 

under paragraph (1) regarding the operation of the defense commissary and exchange systems and to ensure the complementary 

operation of the systems. 

(d) REDUCED PRICES DEFINED.—In this section, the term ‘‘reduced prices’’ means prices for food and other merchandise determined using the price setting process specified in section 2484 of 

this title. 
§ 2482 CH. 147—MWR ACTIVITIES 1384 

(Added Pub. L. 108–375, div. A, title VI, Sec. 651(a)(3), Oct. 28, 2004, 118 Stat. 1965.) 

§ 2482. Commissary stores: criteria for establishment or closure; store size 

(a) PRIMARY CONSIDERATION FOR ESTABLISHMENT.—The needs 

of members of the armed forces on active duty and the needs of dependents of such members shall be the primary consideration 

whenever the Secretary of Defense— 

(1) assesses the need to establish a commissary store; and 

(2) selects the actual location for the store. 

(b) STORE SIZE.—In determining the size of a commissary 

store, the Secretary of Defense shall take into consideration the 

number of all authorized patrons of the defense commissary system 

who are likely to use the store. 

(c) CLOSURE CONSIDERATIONS.—(1) Whenever assessing whether to close a commissary store, the effect of the closure on the quality of life of members and dependents referred to in subsection (a) 

who use the store and on the welfare and security of the military 

community in which the commissary is located shall be a primary 

consideration. 

(2) Whenever assessing whether to close a commissary store, 

the Secretary of Defense shall also consider the effect of the closure 

on the quality of life of members of the reserve components of the 

armed forces. 

(d) CONGRESSIONAL NOTIFICATION.—(1) The closure of a commissary store shall not take effect until the end of the 90-day period beginning on the date on which the Secretary of Defense submits to Congress written notice of the reasons supporting the closure. The written notice shall include an assessment of the impact 

closure will have on the quality of life for military patrons and the 

welfare and security of the military community in which the commissary is located. 

(2) Paragraph (1) shall not apply in the case of the closure of 

a commissary store as part of the closure of a military installation 

under a base closure law. 

(Added Pub. L. 108–375, div. A, title VI, Sec. 651(a)(3), Oct. 28, 2004, 118 Stat. 1965.) 

§ 2483. Commissary stores: use of appropriated funds to 

cover operating expenses 

(a) OPERATION OF AGENCY AND SYSTEM.—Except as otherwise 

provided in this title, the operation of the Defense Commissary 

Agency and the defense commissary system shall be funded using 

such amounts as are appropriated for such purpose. 

(b) OPERATING EXPENSES OF COMMISSARY STORES.—Appropriated funds shall be used to cover the expenses of operating commissary stores and central product processing facilities of the defense commissary system. For purposes of this subsection, operating expenses include the following: 

(1) Salaries and wages of employees of the United States, 

host nations, and contractors supporting commissary store operations. 

(2) Utilities. 

(3) Communications. 

(4) Operating supplies and services. 
1385 § 2484 CH. 147—MWR ACTIVITIES 

(5) Second destination transportation costs within or outside the United States. 

(6) Any cost associated with above-store-level management 

or other indirect support of a commissary store or a central 

product processing facility, including equipment maintenance 

and information technology costs. 

(c) SUPPLEMENTAL FUNDS FOR COMMISSARY OPERATIONS.— Amounts appropriated to cover the expenses of operating the Defense Commissary Agency and the defense commissary system may 

be supplemented with additional funds from manufacturers’ coupon 

redemption fees, handling fees for tobacco products, and other 

amounts received as reimbursement for other support activities 

provided by commissary activities. 

(Added Pub. L. 98–525, title XIV, Sec. 1401(i)(1), Oct. 19, 1984, 98 Stat. 2619, Sec. 2484; amended Pub. L. 106–398, Sec. 1 [[div. A], title III, Sec. 331(a)(1)], Oct. 30, 2000, 114 Stat. 1654, 

1654A–59; Pub. L. 108–136, div. A, title VI, Sec. 654, Nov. 24, 2003, 117 Stat. 1523; renumbered 

Sec. 2483, Pub. L. 108–375, div. A, title VI, Sec. 651(a)(2), (4), Oct. 28, 2004, 118 Stat. 1964, 

1966.) 

§ 2484. Commissary stores: merchandise that may be sold; 

uniform surcharges and pricing 

(a) IN GENERAL.—As provided in section 2481(a) of this title, 

commissary stores are intended to be similar to commercial grocery 

stores and may sell merchandise similar to that sold in commercial 

grocery stores. 

(b) AUTHORIZED COMMISSARY MERCHANDISE CATEGORIES.— Merchandise sold in, at, or by commissary stores may include items 

in the following categories: 

(1) Meat, poultry, seafood, and fresh-water fish. 

(2) Nonalcoholic beverages. 

(3) Produce. 

(4) Grocery food, whether stored chilled, frozen, or at room 

temperature. 

(5) Dairy products. 

(6) Bakery and delicatessen items. 

(7) Nonfood grocery items. 

(8) Tobacco products. 

(9) Health and beauty aids. 

(10) Magazines and periodicals. 

(c) INCLUSION OF OTHER MERCHANDISE ITEMS.—(1) The Secretary of Defense may authorize the sale in, at, or by commissary 

stores of merchandise not covered by a category specified in subsection (b). The Secretary shall notify Congress of all merchandise 

authorized for sale pursuant to this paragraph, as well as the removal of any such authorization. 

(2) Notwithstanding paragraph (1), the Department of Defense 

military resale system shall continue to maintain the exclusive 

right to operate convenience stores, shopettes, and troop stores, including such stores established to support contingency operations. 

(3)(A) A military exchange shall be the vendor for the sale of 

tobacco products in commissary stores and may be the vendor for 

such merchandise as may be authorized for sale in commissary 

stores under paragraph (1). Except as provided in subparagraph 

(B), subsections (d) and (e) shall not apply to the pricing of such 

an item when a military exchange serves as the vendor of the item. 
§ 2484 CH. 147—MWR ACTIVITIES 1386 

Commissary store and exchange prices shall be comparable for 

such an item. 

(B) When a military exchange is the vendor of tobacco products 

or other merchandise authorized for sale in a commissary store 

under paragraph (1), any revenue above the cost of procuring the 

merchandise shall be allocated as if the revenue were a uniform 

sales price surcharge described in subsection (d). 

(d) UNIFORM SALES PRICE SURCHARGE.—The Secretary of Defense shall apply a uniform surcharge equal to five percent on the 

sales prices established under subsection (e) for each item of merchandise sold in, at, or by commissary stores. 

(e) SALES PRICE ESTABLISHMENT.—(1) The Secretary of Defense 

shall establish the sales price of each item of merchandise sold in, 

at, or by commissary stores at the level that will recoup the actual 

product cost of the item. 

(2) Any change in the pricing policies for merchandise sold in, 

at, or by commissary stores shall not take effect until the Secretary 

of Defense submits written notice of the proposed change to Congress and a period of 90 days of continuous session of Congress expires following the date on which notice was received. For purposes 

of this paragraph, the continuity of a session of Congress is broken 

only by an adjournment of the Congress sine die, and the days on 

which either House is not in session because of an adjournment or 

recess of more than three days to a day certain are excluded in a 

computation of such 90-day period. 

(3) The sales price of merchandise and services sold in, at, or 

by commissary stores shall be adjusted to cover the following: 

(A) The cost of first destination commercial transportation 

of the merchandise in the United States to the place of sale. 

(B) The actual or estimated cost of shrinkage, spoilage, 

and pilferage of merchandise under the control of commissary 

stores. 

(f) SPECIAL RULE FOR BRAND-NAME COMMERCIAL ITEMS.—The 

Secretary of Defense may not use the exception provided in section 

2304(c)(5) of this title regarding the procurement of a brand-name 

commercial item for resale in, at, or by commissary stores unless 

the commercial item is regularly sold outside of commissary stores 

under the same brand name as the name by which the commercial 

item will be sold in, at, or by commissary stores. In determining 

whether a brand name commercial item is regularly sold outside of 

commissary stores, the Secretary shall consider only sales of the 

item on a regional or national basis by commercial grocery or other 

retail operations consisting of multiple stores. 

(g) SPECIAL RULES FOR CERTAIN MERCHANDISE.—(1) Notwithstanding the general requirement that merchandise sold in, at, or 

by commissary stores be commissary store inventory, the Secretary 

of Defense may authorize the sale of tobacco products as noncommissary store inventory. Except as provided in paragraph (2), subsections (d) and (e) shall not apply to the pricing of such merchandise items. 

(2) When tobacco products are authorized for sale in a commissary store as noncommissary store inventory, any revenue 

above the cost of procuring the tobacco products shall be allocated 
1387 § 2484 CH. 147—MWR ACTIVITIES 

as if the revenue were a uniform sales price surcharge described 

in subsection (d). 

(h) USE OF SURCHARGE FOR CONSTRUCTION, REPAIR, IMPROVEMENT, AND MAINTENANCE.—(1)(A) The Secretary of Defense may 

use the proceeds from the surcharges imposed under subsection (d) 

only— 

(i) to acquire (including acquisition by lease), construct, 

convert, expand, improve, repair, maintain, and equip the 

physical infrastructure of commissary stores and central product processing facilities of the defense commissary system; and 

(ii) to cover environmental evaluation and construction 

costs related to activities described in clause (i), including costs 

for surveys, administration, overhead, planning, and design. 

(B) In subparagraph (A), the term ‘‘physical infrastructure’’ includes real property, utilities, and equipment (installed and free 

standing and including computer equipment), necessary to provide 

a complete and usable commissary store or central product processing facility. 

(2)(A) The Secretary of Defense may authorize a nonappropriated fund instrumentality of the United States to enter 

into a contract for construction of a shopping mall or similar facility for a commissary store and one or more nonappropriated fund 

instrumentality activities. The Secretary may use the proceeds of 

surcharges under subsection (d) to reimburse the nonappropriated 

fund instrumentality for the portion of the cost of the contract that 

is attributable to construction of the commissary store or to pay the 

contractor directly for that portion of such cost. 

(B) In subparagraph (A), the term ‘‘construction’’, with respect 

to a facility, includes acquisition, conversion, expansion, installation, or other improvement of the facility. 

(3)(A) The Secretary of Defense may use the proceeds derived 

from surcharges imposed under subsection (d) in connection with 

sales of commissary merchandise through initiatives described in 

subparagraph (B) to offset the cost of such initiatives. 

(B) Subparagraph (A) applies with respect to initiatives, utilizing temporary and mobile equipment, intended to provide members of reserve components, retired members, and other persons eligible for commissary benefits, but without reasonable access to 

commissary stores, improved access to commissary merchandise. 

(4) The Secretary of Defense, with the approval of the Director 

of the Office of Management and Budget, may obligate anticipated 

proceeds from the surcharges under subsection (d) for any use specified in paragraph (1), (2), or (3), without regard to fiscal year limitations, if the Secretary determines that such obligation is necessary to carry out any use of such adjustments or surcharges specified in such paragraph. 

(5) Revenues received by the Secretary of Defense from the following sources or activities of commissary store facilities shall be 

available for the purposes set forth in paragraphs (1), (2), and (3): 

(A) Sale of recyclable materials. 

(B) Sale of excess and surplus property. 

(C) License fees. 

(D) Royalties. 
§ 2485 CH. 147—MWR ACTIVITIES 1388 

(E) Fees paid by sources of products in order to obtain favorable display of the products for resale, known as business 

related management fees. 

(Added Pub. L. 99–661, div. A, title III, Sec. 313(a), Nov. 14, 1986, 100 Stat. 3852, Sec. 2486; 

amended Pub. L. 100–180, div. A, title III, Sec. 313(a)(1), (2), Dec. 4, 1987, 101 Stat. 1073, 1074; 

Pub. L. 104–201, div. A, title III, Sec. 342(a), Sept. 23, 1996, 110 Stat. 2489; Pub. L. 105–85, 

div. A, title III, Secs. 372(a)–(e), 373, Nov. 18, 1997, 111 Stat. 1706, 1707; Pub. L. 105–261, div. 

A, title III, Sec. 364, Oct. 17, 1998, 112 Stat. 1986; Pub. L. 106–65, div. A, title X, Sec. 

1066(a)(21), Oct. 5, 1999, 113 Stat. 771; Pub. L. 106–398, Sec. 1 [[div. A], title III, Secs. 332(a), 

334], Oct. 30, 2000, 114 Stat. 1654, 1654A–59, 1654A–60; Pub. L. 107–314, div. A, title X, Sec. 

1041(a)(14), Dec. 2, 2002, 116 Stat. 2645; renumbered Sec. 2484 and amended, Pub. L. 108–375, 

div. A, title VI, Sec. 651(a)(2), (4), (5), Oct. 28, 2004, 118 Stat. 1964, 1966; Pub. L. 109–364, 

div. A, title VI, Sec. 661, title X, Sec. 1071(g)(6), Oct. 17, 2006, 120 Stat. 2262, 2402; Pub. L. 

110–417, [div. A], title VI, Sec. 641, Oct. 14, 2008, 122 Stat. 4493.) 

§ 2485. Commissary stores: operation 

(a) PRIVATE OPERATION.—(1) Under such regulations as the 

Secretary of Defense may approve, private persons may operate selected commissary store functions, except that such functions may 

not include functions relating to the procurement of products to be 

sold in a commissary store or functions relating to the overall management of a commissary system or the management of a commissary store. Such functions shall be carried out by personnel of 

the Department of Defense under regulations approved by the Secretary of Defense. 

(2) Any change to private operation of a commissary store function that is being performed by more than 10 Department of Defense civilian employees shall not take effect until the end of the 

75-day period beginning on the date on which the Secretary of Defense submits to Congress written notice of the change. Until December 31, 2008, the Defense Commissary Agency is not required 

to conduct any cost-comparison study under the policies and procedures of Office of Management and Budget Circular A–76 relating 

to the possible contracting out of commissary store functions. 

(b) CONTRACTS WITH OTHER AGENCIES AND INSTRUMENTAL- ITIES.—(1) The Defense Commissary Agency, and any other agency 

of the Department of Defense that supports the operation of the 

commissary system, may enter into a contract or other agreement 

with another element of the Department of Defense or with another Federal department, agency, or instrumentality to provide or 

obtain services beneficial to the efficient management and operation of the commissary system. However, the Defense Commissary 

Agency may not pay for any such service provided by the United 

States Transportation Command any amount that exceeds the 

price at which the service could be procured through full and open 

competition, as such term is defined in section 107 of title 41. 

(2) A commissary store operated by a nonappropriated fund instrumentality of the Department of Defense shall be operated in accordance with section 2483 of this title. Subject to such section, the 

Secretary of Defense may authorize a transfer of goods, supplies, 

and facilities of, and funds appropriated for, the Defense Commissary Agency or any other agency of the Department of Defense 

that supports the operation of the commissary system to a nonappropriated fund instrumentality for the operation of a commissary store. 

(c) GOVERNING BOARD.—(1) Notwithstanding section 192(d) of 

this title, the Secretary of Defense shall establish a governing 
1389 § 2485 CH. 147—MWR ACTIVITIES 

board for the commissary system to provide advice to the Secretary 

regarding the prudent operation of the commissary system and to 

assist in the overall supervision of the Defense Commissary Agency. The Secretary may authorize the board to have such supervisory authority as the Secretary considers appropriate to permit 

the board to carry out its responsibilities. 

(2) The Secretary of Defense shall determine the membership 

of the governing board, which shall include, at a minimum, appropriate representatives from each military department. The chairman of the governing board shall be a commissioned officer or 

member of the senior executive service who has demonstrated experience or knowledge relevant to the management of the defense 

commissary system. In selecting other members of the governing 

board, the Secretary shall give priority to persons with experience 

related to logistics, military personnel, military entitlements or 

other experiences of value of management of commissaries. 

(3) The governing board shall be accountable only to the Secretary of Defense and to the civilian officer of the Department of 

Defense who is assigned the responsibility for the overall supervision of the Defense Commissary Agency pursuant to section 

192(a) of this title. The Director of the Defense Commissary Agency 

shall be accountable to and report to the board. 

(d) ASSIGNMENT OF ACTIVE DUTY MEMBERS.—(1) Except as provided in paragraph (2), members of the armed forces on active duty 

may not be assigned to the operation of a commissary store. 

(2)(A) The Secretary of Defense may assign an officer on the 

active-duty list to serve as the Director of the Defense Commissary 

Agency. 

(B) Not more than 18 members (in addition to the officer referred to in subparagraph (A)) of the armed forces on active duty 

may be assigned to the Defense Commissary Agency. Members who 

may be assigned under this subparagraph to regional headquarters 

of the agency shall be limited to enlisted members assigned to duty 

as advisers in the regional headquarters responsible for overseas 

commissaries and to veterinary specialists. 

(e) REIMBURSEMENT FOR USE OF COMMISSARY FACILITIES BY

MILITARY DEPARTMENTS.—(1) The Secretary of a military department shall pay the Defense Commissary Agency the amount determined under paragraph (2) for any use of a commissary facility by 

the military department for a purpose other than commissary sales 

or operations in support of commissary sales. 

(2) The amount payable under paragraph (1) for use of a commissary facility by a military department shall be equal to the 

share of depreciation of the facility that is attributable to that use, 

as determined under regulations prescribed by the Secretary of Defense. 

(3) The Director of the Defense Commissary Agency shall credit amounts paid under paragraph (1) for use of a facility to an appropriate account to which proceeds of a surcharge applied under 

section 2484(d) of this title are credited. 

(4) This subsection applies with respect to a commissary facility that is acquired, constructed, converted, expanded, installed, or 

otherwise improved (in whole or in part) with the proceeds of a surcharge applied under section 2484(d) of this title. 
§ 2485 CH. 147—MWR ACTIVITIES 1390 

(f) DONATION OF UNUSABLE FOOD.—(1) The Secretary of Defense may donate food described in paragraph (2) to any of the following entities: 

(A) A charitable nonprofit food bank that is designated by 

the Secretary of Defense or the Secretary of Health and 

Human Services as authorized to receive such donations. 

(B) A State or local agency that is designated by the Secretary of Defense or the Secretary of Health and Human Services as authorized to receive such donations. 

(C) A chapter or other local unit of a recognized national 

veterans organization that provides services to persons without 

adequate shelter and is designated by the Secretary of Veterans Affairs as authorized to receive such donations. 

(D) A not-for-profit organization that provides care for 

homeless veterans and is designated by the Secretary of Veterans Affairs as authorized to receive such donations. 

(2) Food that may be donated under this subsection is commissary store food, mess food, meals ready-to-eat (MREs), rations 

known as humanitarian daily rations (HDRs), and other food available to the Secretary of Defense that— 

(A) is certified as edible by appropriate food inspection 

technicians; 

(B) would otherwise be destroyed as unusable; and 

(C) in the case of commissary store food, is unmarketable 

and unsaleable. 

(3) In the case of commissary store food, a donation under this 

subsection shall take place at the site of the commissary store that 

is donating the food. 

(4) This subsection does not authorize any service (including 

transportation) to be provided in connection with a donation under 

this subsection. 

(g) COLLECTION OF DISHONORED CHECKS.—(1) The Secretary of 

Defense may impose a charge for the collection of a check accepted 

at a commissary store that is not honored by the financial institution on which the check is drawn. The imposition and amounts of 

charges shall be consistent with practices of commercial grocery 

stores regarding dishonored checks. 

(2)(A) The following persons are liable to the United States for 

the amount of a check referred to in paragraph (1) that is returned 

unpaid to the United States, together with any charge imposed 

under that paragraph: 

(i) The person who presented the check. 

(ii) Any person whose status and relationship to the person 

who presented the check provide the basis for that person’s eligibility to make purchases at a commissary store. 

(B) Any amount for which a person is liable under subparagraph (A) may be collected by deducting and withholding such 

amount from any amounts payable to that person by the United 

States. 

(3) Amounts collected as charges imposed under paragraph (1) 

shall be credited to the commissary trust revolving fund. 

(4) Appropriated funds may be used to pay any costs incurred 

in the collection of checks and charges referred to in paragraph (1). 

An appropriation account charged a cost under the preceding sen-
1391 § 2485 CH. 147—MWR ACTIVITIES 

tence shall be reimbursed the amount of that cost out of funds in 

the commissary trust revolving fund. 

(5) In this subsection, the term ‘‘commissary trust revolving 

fund’’ means the trust revolving fund maintained by the Department of Defense for surcharge collections and proceeds of sales of 

commissary stores. 

(h) RELEASE OF CERTAIN COMMERCIALLY VALUABLE INFORMATION TO PUBLIC.—(1) The Secretary of Defense may limit the release to the public of any information described in paragraph (2) 

if the Secretary determines that it is in the best interest of the Department of Defense to limit the release of such information. If the 

Secretary determines to limit the release of any such information, 

the Secretary may provide for limited release of such information 

in accordance with paragraph (3). 

(2) Paragraph (1) applies to the following: 

(A) Information contained in the computerized business 

systems of commissary stores or the Defense Commissary 

Agency that is collected through or in connection with the use 

of electronic scanners in commissary stores, including the following information: 

(i) Data relating to sales of goods or services. 

(ii) Demographic information on customers. 

(iii) Any other information pertaining to commissary 

transactions and operations. 

(B) Business programs, systems, and applications (including software) relating to commissary operations that were developed with funding derived from commissary surcharges. 

(3)(A) The Secretary of Defense may, using competitive procedures, enter into a contract to sell information described in paragraph (2). 

(B) The Secretary of Defense may release, without charge, information on an item sold in commissary stores to the manufacturer or producer of that item or an agent of the manufacturer or 

producer. 

(C) The Secretary of Defense shall establish performance 

benchmarks and shall submit information on customer satisfaction 

and performance data to the Committee on Armed Services of the 

Senate and the Committee on Armed Services of the House of Representatives. 

(D) The Secretary of Defense may, by contract entered into 

with a business, grant to the business a license to use business programs referred to in paragraph (2)(B), including software used in 

or comprising any such program. The fee charged for the license 

shall be based on the costs of similar programs developed and marketed by businesses in the private sector, determined by means of 

surveys. 

(E) Each contract entered into under this paragraph shall 

specify the amount to be paid for information released or a license 

granted under the contract, as the case may be. 

(4) Information described in paragraph (2) may not be released, 

under paragraph (3) or otherwise, in a form that identifies any customer or that provides information making it possible to identify 

any customer. 
§ 2487 CH. 147—MWR ACTIVITIES 1392 

(5) Amounts received by the Secretary under this section shall 

be credited to funds derived from commissary surcharges applied 

under section 2484(e) of this title, shall be merged with those 

funds, and shall be available for the same purposes as the funds 

with which merged. 

(Aug. 10, 1956, ch. 1041, 70A Stat. 141, Sec. 2482; Pub. L. 100–456, div. A, title III, Sec. 321, 

Sept. 29, 1988, 102 Stat. 1952; Pub. L. 104–106, div. A, title III, Sec. 331(a), Feb. 10, 1996, 110 

Stat. 260; Pub. L. 104–201, div. A, title III, Sec. 341(b), Sept. 23, 1996, 110 Stat. 2489; Pub. 

L. 105–261, div. A, title III, Secs. 361(b), 363(a), Oct. 17, 1998, 112 Stat. 1984, 1985; Pub. L. 

108–136, div. A, title VI, Sec. 653, Nov. 24, 2003, 117 Stat. 1522; renumbered Sec. 2485 and 

amended Pub. L. 108–375, div. A, title VI, Sec. 651(a)(2), (6), (7), Oct. 28, 2004, 118 Stat. 1964, 

1968; Pub. L. 109–163, div. A, title VI, Sec. 672, Jan. 6, 2006, 119 Stat. 3319; Pub. L. 111– 

350, Sec. 5(b)(35), Jan. 4, 2011, 124 Stat. 3845.) 

SUBCHAPTER II—RELATIONSHIP, CONTINUATION, AND 

COMMON POLICIES OF DEFENSE COMMISSARY AND EXCHANGE SYSTEMS 

Sec. 

2487. Relationship between defense commissary system and exchange stores system. 

2488. Combined exchange and commissary stores. 

2489. Overseas commissary and exchange stores: access and purchase restrictions. 

§ 2487. Relationship between defense commissary system 

and exchange stores system 

(a) SEPARATE OPERATION OF SYSTEMS.—(1) Except as provided 

in paragraph (2), the defense commissary system and the exchange 

stores system shall be operated as separate systems of the Department of Defense. 

(2) Paragraph (1) does not apply to the following: 

(A) Combined exchange and commissary stores operated 

under the authority provided by section 2489 of this title. 

(B) NEXMART stores of the Navy Exchange Service Command established before October 1, 2003. 

(b) CONSOLIDATION OR OTHER ORGANIZATIONAL CHANGES OF

DEFENSE RETAIL SYSTEMS.—(1) The operation and administration 

of the defense retail systems may not be consolidated or otherwise 

merged unless the consolidation or merger is specifically authorized 

by an Act of Congress. 

(2) In this subsection, the term ‘‘defense retail systems’’ means 

the defense commissary system and exchange stores system and 

other revenue-generating facilities operated by nonappropriated 

fund instrumentalities of the Department of Defense for the morale, welfare, and recreation of members of the armed forces. 

(Added Pub. L. 108–375, div. A, title VI, Sec. 651(b)(1), Oct. 28, 2004, 118 Stat. 1971.) 

§ 2488. Combined exchange and commissary stores 

(a) AUTHORITY.—The Secretary of Defense may authorize a 

nonappropriated fund instrumentality to operate a military exchange and a commissary store as a combined exchange and commissary store on a military installation. 

(b) LIMITATIONS.—(1) Not more than ten combined exchange 

and commissary stores may be operated pursuant to this section. 
1393 § 2489 CH. 147—MWR ACTIVITIES 

(2) The Secretary may select a military installation for the operation of a combined exchange and commissary store under this 

section only if— 

(A) the installation is to be closed, or has been or is to be 

realigned, under a base closure law; or 

(B) a military exchange and a commissary store are operated at the installation by separate entities at the time of, or 

immediately before, such selection and it is not economically 

feasible to continue that separate operation. 

(c) OPERATION AT CARSWELL FIELD.—Combined exchange and 

commissary stores operated under this section shall include the 

combined exchange and commissary store that is operated at the 

Naval Air Station Fort Worth, Joint Reserve Center, Carswell 

Field, Texas, under the authority provided in section 375 of the National Defense Authorization Act for Fiscal Year 1995 (Public Law 

103–337; 108 Stat. 2736). 

(d) ADJUSTMENTS AND SURCHARGES.—Adjustments to, and surcharges on, the sales price of a grocery food item sold in a combined exchange and commissary store under this section shall be 

provided for in accordance with the same laws that govern such adjustments and surcharges for items sold in a commissary store of 

the Defense Commissary Agency. 

(e) USE OF APPROPRIATED FUNDS.—(1) If a nonappropriated 

fund instrumentality incurs a loss in operating a combined exchange and commissary store at a military installation under this 

section as a result of the requirement set forth in subsection (d), 

the Secretary may authorize a transfer of funds available for the 

Defense Commissary Agency to the nonappropriated fund instrumentality to offset the loss. 

(2) The total amount of appropriated funds transferred during 

a fiscal year to support the operation of a combined exchange and 

commissary store at a military installation under this section may 

not exceed an amount that is equal to 25 percent of the amount 

of appropriated funds that was provided for the operation of the 

commissary store of the Defense Commissary Agency on that installation during the last full fiscal year of operation of that commissary store. 

(f) NONAPPROPRIATED FUND INSTRUMENTALITY DEFINED.—In 

this section, the term ‘‘nonappropriated fund instrumentality’’ 

means the Army and Air Force Exchange Service, Navy Exchange 

Service Command, Marine Corps exchanges, or any other instrumentality of the United States under the jurisdiction of the armed 

forces which is conducted for the comfort, pleasure, contentment, or 

physical or mental improvement of members of the armed forces. 

(Added 104–106, div. A, title III, Sec. 336(a)(1), Feb. 10, 1996, 110 Stat. 263, Sec. 2490a; amended Pub. L. 105–85, div. A, title X, Sec. 1061(d), Nov. 18, 1997, 111 Stat. 1891; Pub. L. 108– 

136, div. A, title X, Sec. 1043(c)(2), Nov. 24, 2003, 117 Stat. 1611; renumbered Sec. 2488, Pub. 

L. 108–375, div. A, title VI, Sec. 651(b)(3), Oct. 28, 2004, 118 Stat. 1971; Pub. L. 111–383, div. 

A, title X, Sec. 1075(b)(37), Jan. 7, 2011, 124 Stat. 4371.) 

§ 2489. Overseas commissary and exchange stores: access 

and purchase restrictions 

(a) GENERAL AUTHORITY.—(1) The Secretary of Defense may 

establish restrictions on the ability of eligible patrons of commissary and exchange stores located outside of the United States 
§ 2489 CH. 147—MWR ACTIVITIES 1394 

to purchase certain merchandise items (or the quantity of certain 

merchandise items) otherwise included within an authorized merchandise category if the Secretary determines that such restrictions 

are necessary to prevent the resale of such merchandise in violation of treaty obligations of the United States or host nation laws 

(to the extent such laws are not inconsistent with United States 

laws). 

(2) In establishing a quantity or other restriction, the Secretary— 

(A) may not discriminate among the various categories of 

eligible patrons of the commissary and exchange system; and 

(B) shall ensure that the restriction is consistent with the 

purpose of the overseas commissary and exchange system to 

provide reasonable access for eligible patrons to purchase merchandise items made in the United States. 

(b) CONTROLLED ITEM LISTS.—For each location outside the 

United States that is served by the commissary system or the exchange system, the Secretary of Defense may maintain a list of 

controlled merchandise items, except that, after October 17, 1998, 

the Secretary may not change the list to add a merchandise item 

unless, before making the change, the Secretary submits to Congress a notice of the proposed addition and the reasons for the addition of the item. 

(c) NOTIFICATION OF CONDITIONS NECESSITATING RESTRICTIONS.—The Secretary of Defense shall notify Congress of any 

change proposed or made to any of the host nation laws or any of 

the treaty obligations of the United States, and any changed conditions within host nations, if the change would necessitate the use 

of quantity or other restrictions on purchases in commissary and 

exchange stores located outside the United States. 

(Added Pub. L. 105–261, div. A, title III, Sec. 365(a), Oct. 17, 1998, 112 Stat. 1986, Sec. 2492; 

amended Pub. L. 106–65, div. A, title X, Sec. 1066(a)(22), Oct. 5, 1999, 113 Stat. 771; Pub. L. 

107–314, div. A, title X, Sec. 1041(a)(15), Dec. 2, 2002, 116 Stat. 2645; renumbered Sec. 2489, 

Pub. L. 108–375, div. A, title VI, Sec. 651(b)(3), Oct. 28, 2004, 118 Stat. 1971.) 

SUBCHAPTER III—MORALE, WELFARE, AND RECREATION 

PROGRAMS AND NONAPPROPRIATED FUND INSTRUMENTALITIES 

Sec. 

2491. Uniform funding and management of morale, welfare, and recreation programs. 

2491a. Department of Defense golf courses: limitation on use of appropriated 

funds. 

2491b. Use of appropriated funds for operation of Armed Forces Recreation Center, Europe: limitation. 

2491c. Retention of morale, welfare, and recreation funds by military installations: limitation. 

2492. Nonappropriated fund instrumentalities: contracts with other agencies and 

instrumentalities to provide and obtain goods and services. 

2492a. Limitation on Department of Defense entities competing with private sector in offering personal information services. 

2493. Fisher Houses: administration as nonappropriated fund instrumentality. 

2494. Nonappropriated fund instrumentalities: furnishing utility services for morale, welfare, and recreation purposes. 

2495. Nonappropriated fund instrumentalities: purchase of alcoholic beverages. 

2495a. Overseas package stores: treatment of United States wines. 

2495b. Sale or rental of sexually explicit material prohibited. 
1395 § 2491a CH. 147—MWR ACTIVITIES 

§ 2491. Uniform funding and management of morale, welfare, and recreation programs 

(a) AUTHORITY FOR UNIFORM FUNDING AND MANAGEMENT.— Under regulations prescribed by the Secretary of Defense, funds 

appropriated to the Department of Defense and available for morale, welfare, and recreation programs may be treated as nonappropriated funds and expended in accordance with laws applicable to the expenditures of nonappropriated funds. When made 

available for morale, welfare, and recreation programs under such 

regulations, appropriated funds shall be considered to be nonappropriated funds for all purposes and shall remain available 

until expended. 

(b) CONDITIONS ON AVAILABILITY.—Funds appropriated to the 

Department of Defense may be made available to support a morale, 

welfare, or recreation program only if the program is authorized to 

receive appropriated fund support and only in the amounts the program is authorized to receive. 

(c) CONVERSION OF EMPLOYMENT POSITIONS.—(1) The Secretary of Defense may identify positions of employees in morale, 

welfare, and recreation programs within the Department of Defense who are paid with appropriated funds whose status may be 

converted from the status of an employee paid with appropriated 

funds to the status of an employee of a nonappropriated fund instrumentality. 

(2) The status of an employee in a position identified by the 

Secretary under paragraph (1) may, with the consent of the employee, be converted to the status of an employee of a nonappropriated fund instrumentality. An employee who does not consent to the conversion may not be removed from the position because of the failure to provide such consent. 

(3) The conversion of an employee from the status of an employee paid by appropriated funds to the status of an employee of 

a nonappropriated fund instrumentality shall be without a break 

in service for the concerned employee. The conversion shall not entitle an employee to severance pay, back pay or separation pay 

under subchapter IX of chapter 55 of title 5, or be considered an 

involuntary separation or other adverse personnel action entitling 

an employee to any right or benefit under such title or any other 

provision of law or regulation. 

(4) In this subsection, the term ‘‘an employee of a nonappropriated fund instrumentality’’ means an employee described 

in section 2105(c) of title 5. 

(Added Pub. L. 107–314, div. A, title III, Sec. 323(a), Dec. 2, 2002, 116 Stat. 2510, Sec. 2494; 

renumbered Sec. 2491, Pub. L. 108–375, div. A, title VI, Sec. 651(c)(2), Oct. 28, 2004, 118 Stat. 

1972.) 

§ 2491a. Department of Defense golf courses: limitation on 

use of appropriated funds 

(a) LIMITATION.—Except as provided in subsection (b), funds 

appropriated to the Department of Defense may not be used to 

equip, operate, or maintain a golf course at a facility or installation 

of the Department of Defense. 

(b) EXCEPTIONS.—(1) Subsection (a) does not apply to a golf 

course at a facility or installation outside the United States or at 
§ 2491b CH. 147—MWR ACTIVITIES 1396 

a facility or installation inside the United States at a location designated by the Secretary of Defense as a remote and isolated location. 

(2) The Secretary of Defense shall prescribe regulations governing the use of appropriated funds under this subsection. 

(Added Pub. L. 103–160, div. A, title III, Sec. 312(a), Nov. 30, 1993, 107 Stat. 1618, Sec. 2246; 

renumbered Sec. 2491a, Pub. L. 108–375, div. A, title VI, Sec. 651(d), Oct. 28, 2004, 118 Stat. 

1972.) 

§ 2491b. Use of appropriated funds for operation of Armed 

Forces Recreation Center, Europe: limitation 

(a) LIMITATION.—Except as provided in subsection (b), funds 

appropriated to the Department of Defense may not be used to operate the Armed Forces Recreation Center, Europe. 

(b) EXCEPTION.—Subsection (a) does not apply to the use of 

funds for the payment of utilities, the maintenance, repair, or renovation of real property, and the transportation of products made 

in the United States. 

(Added Pub. L. 103–337, div. A, title III, Sec. 372(a), Oct. 5, 1994, 108 Stat. 2735, Sec. 2247; 

amended Pub. L. 105–85, div. A, title III, Sec. 375, Nov. 18, 1997, 111 Stat. 1708; renumbered 

Sec. 2491b, Pub. L. 108–375, div. A, title VI, Sec. 651(d), Oct. 28, 2004, 118 Stat. 1972.) 

§ 2491c. Retention of morale, welfare, and recreation funds 

by military installations: limitation 

Amounts may not be retained in a nonappropriated morale, 

welfare, and recreation account of a military installation of an 

armed force in excess of the amount necessary to meet cash requirements of that installation. Amounts in excess of that amount 

shall be transferred to a single nonappropriated morale, welfare, 

and recreation account for that armed force. This section does not 

apply to the Coast Guard. 

(Added Pub. L. 103–337, div. A, title III, Sec. 373(a), Oct. 5, 1994, 108 Stat. 2736, Sec. 2219; 

amended Pub. L. 104–106, div. A, title III, Sec. 341, Feb. 10, 1996, 110 Stat. 265; renumbered 

Sec. 2491c, Pub. L. 108–375, div. A, title VI, Sec. 651(d), Oct. 28, 2004, 118 Stat. 1972.) 

§ 2492. Nonappropriated fund instrumentalities: contracts 

with other agencies and instrumentalities to provide and obtain goods and services 

An agency or instrumentality of the Department of Defense 

that supports the operation of the exchange system, or the operation of a morale, welfare, and recreation system, of the Department of Defense may enter into a contract or other agreement with 

another element of the Department of Defense or with another 

Federal department, agency, or instrumentality to provide or obtain goods and services beneficial to the efficient management and 

operation of the exchange system or that morale, welfare, and 

recreation system. 

(Added Pub. L. 104–201, div. A, title III, Sec. 341(a)(1), Sept. 23, 1996, 110 Stat. 2488, Sec. 

2482a; renumbered Sec. 2492, Pub. L. 108–375, div. A, title VI, Sec. 651(c)(3), Oct. 28, 2004, 

118 Stat. 1972.) 

§ 2492a. Limitation on Department of Defense entities competing with private sector in offering personal information services 

(a) LIMITATION.—(1) Notwithstanding section 2492 of this title, 

the Secretary of Defense may not authorize a Department of De-
1397 § 2493 CH. 147—MWR ACTIVITIES 

fense entity to offer or provide personal information services directly to users using Department resources, personnel, or equipment, or compete for contracts to provide such personal information 

services directly to users, if users will be charged a fee for the personal information services to recover the cost incurred to provide 

the services or to earn a profit. 

(2) The limitation in paragraph (1) shall not be construed to 

prohibit or preclude the use of Department resources, personnel, or 

equipment to administer or facilitate personal information services 

contracts with private contractors. 

(b) EXCEPTIONS.—The limitation in subsection (a) shall not 

apply if the Secretary of Defense determines that— 

(1) a private sector vendor is not available to provide the 

personal information services at specific locations; 

(2) the interests of the user population would be best 

served by allowing the Government to provide such services; or 

(3) circumstances (as specified by the Secretary for purposes of this section) are such that the provision of such services by a Department entity is in the best interest of the Government or military users in general. 

(c) PERSONAL INFORMATION SERVICES DEFINED.—In this section, the term ‘‘personal information services’’ means the provision 

of Internet, telephone, or television services to consumers. 

(Added Pub. L. 111–84, div. A, title VI, Sec. 651(a), Oct. 28, 2009, 123 Stat. 2368.) 

§ 2493. Fisher Houses: administration as nonappropriated 

fund instrumentality 

(a) FISHER HOUSES AND SUITES DEFINED.—In this section: 

(1) The term ‘‘Fisher House’’ means a housing facility 

that— 

(A) is located in proximity to a health care facility of 

the Army, the Air Force, or the Navy; 

(B) is available for residential use on a temporary 

basis by patients of that health care facility, members of 

the families of such patients, and others providing the 

equivalent of familial support for such patients; and 

(C) is constructed and donated by— 

(i) the Zachary and Elizabeth M. Fisher Armed 

Services Foundation; or 

(ii) another source, if the Secretary of the military 

department concerned designates the housing facility 

as a Fisher House. 

(2) The term ‘‘Fisher Suite’’ means one or more rooms 

that— 

(A) meet the requirements of subparagraphs (A) and 

(B) of paragraph (1); 

(B) are constructed, altered, or repaired and donated 

by a source described in subparagraph (C) of that paragraph; and 

(C) are designated by the Secretary of the military department concerned as a Fisher Suite. 

(b) NONAPPROPRIATED FUND INSTRUMENTALITY.—The Secretary 

of each military department shall administer all Fisher Houses and 

Fisher Suites associated with health care facilities of that military 
§ 2494 CH. 147—MWR ACTIVITIES 1398 

department as a nonappropriated fund instrumentality of the 

United States. 

(c) GOVERNANCE.—The Secretary of each military department 

shall establish a system for the governance of the nonappropriated 

fund instrumentality required by subsection (b) for that military 

department. 

(d) CENTRAL FUND.—The Secretary of each military department shall establish a single fund as the source of funding for the 

operation, maintenance, and improvement of all Fisher Houses and 

Fisher Suites of the nonappropriated fund instrumentality required 

by subsection (b) for that military department. 

(e) ACCEPTANCE OF CONTRIBUTIONS; IMPOSITION OF FEES.—(1) 

The Secretary of a military department may— 

(A) accept money, property, and services donated for the 

support of a Fisher House or Fisher Suite associated with 

health care facilities of that military department; and 

(B) may impose fees relating to the use of such Fisher 

Houses and Fisher Suites. 

(2) All monetary donations, and the proceeds of the disposal of 

any other donated property, accepted by the Secretary of a military 

department under this subsection shall be credited to the fund established under subsection (d) for the Fisher Houses and Fisher 

Suites associated with health care facilities of that military department and shall be available to that Secretary to support all such 

Fisher Houses and Fisher Suites. 

(f) BASE OPERATING SUPPORT.—The Secretary of a military department may provide base operating support for Fisher Houses associated with health care facilities of that military department. 

(g) ANNUAL REPORT.—Not later than January 15 of each year, 

the Secretary of each military department shall submit to Congress 

a report describing the operation of Fisher Houses and Fisher 

Suites associated with health care facilities of that military department. The report shall include, at a minimum, the following: 

(1) The amount in the fund established by that Secretary 

under subsection (d) as of October 1 of the previous year. 

(2) The operation of the fund during the preceding fiscal 

year, including— 

(A) all gifts, fees, and interest credited to the fund; 

and 

(B) all disbursements from the fund. 

(3) The budget for the operation of the Fisher Houses and 

Fisher Suites for the fiscal year in which the report is submitted. 

(Added Pub. L. 105–261, div. A, title IX, Sec. 906(a)(1), Oct. 17, 1998, 112 Stat. 2093; Pub. L. 

106–398, Sec. 1 [[div. A], title IX, Sec. 914(a)], Oct. 30, 2000, 114 Stat. 1654, 1654A–230; Pub. 

L. 107–314, div. A, title III, Sec. 321, Dec. 2, 2002, 116 Stat. 2510.) 

§ 2494. Nonappropriated fund instrumentalities: furnishing 

utility services for morale, welfare, and recreation 

purposes 

Appropriations for the Department of Defense may be used to 

provide utility services for— 
1399 § 2495a CH. 147—MWR ACTIVITIES 

(1) buildings on military installations authorized by regulation to be used for morale, welfare, and recreation purposes; 

and 

(2) other morale, welfare, and recreation activities for 

members of the armed forces. 

(Added Pub. L. 108–375, div. A, title VI, Sec. 651(c)(4), Oct. 28, 2004, 118 Stat. 1972.) 

§ 2495. Nonappropriated fund instrumentalities: purchase of 

alcoholic beverages 

(a) The Secretary of Defense shall provide that— 

(1) covered alcoholic beverage purchases made for resale 

on a military installation located in the United States shall be 

made from the most competitive source and distributed in the 

most economical manner, price and other factors considered, 

except that 

(2) in the case of malt beverages and wine, such purchases 

shall be made from, and delivery shall be accepted from, a 

source within the State in which the military installation concerned is located. 

(b) If a military installation located in the contiguous States is 

located in more than one State, a source of supply in any State in 

which the installation is located shall be considered for the purposes of subsection (a)(2) to be a source within the State in which 

the installation is located. 

(c)(1) In the case of covered alcoholic beverage purchases of distilled spirits, to determine whether a nonappropriated fund instrumentality of the Department of Defense provides the most economical method of distribution to package stores, the Secretary of Defense shall consider all components of the distribution costs incurred by the nonappropriated fund instrumentality, such as overhead costs (including costs associated with management, logistics, 

administration, depreciation, and utilities), the costs of carrying inventory, and handling and distribution costs. 

(2) The Secretary shall use the agencies performing audit functions on behalf of the armed forces and the Inspector General of 

the Department of Defense to make determinations under this subsection. 

(d) In this section: 

(1) The term ‘‘covered alcoholic beverage purchases’’ means 

purchases of alcoholic beverages by a nonappropriated fund instrumentality of the Department of Defense with nonappropriated funds. 

(2) The term ‘‘State’’ includes the District of Columbia. 

(Added Pub. L. 99–661, div. A, title III, Sec. 313(a), Nov. 14, 1986, 100 Stat. 3853, Sec. 2488; 

amended Pub. L. 100–180, div. A, title III, Sec. 312(a), Dec. 4, 1987, 101 Stat. 1073; Pub. L. 

104–106, div. A, title III, Sec. 333, Feb. 10, 1996, 110 Stat. 261; Pub. L. 106–398, Sec. 1 [[div. 

A], title III, Sec. 335], Oct. 30, 2000, 114 Stat. 1654, 1654A–61; renumbered Sec. 2495, Pub. 

L. 108–375, div. A, title VI, Sec. 651(b)(2), (c)(5), Oct. 28, 2004, 118 Stat. 1971, 1972.) 

§ 2495a. Overseas package stores: treatment of United States 

wines 

The Secretary of Defense shall ensure that each nonappropriated-fund activity engaged principally in selling alcoholic 

beverage products in a packaged form (commonly referred to as a 

‘‘package store’’) that is located at a military installation outside 
§ 2495b CH. 147—MWR ACTIVITIES 1400 

the United States shall give appropriate treatment with respect to 

wines produced in the United States to ensure that such wines are 

given, in general, an equitable distribution, selection, and price 

when compared with wines produced by the host nation. 

(Added Pub. L. 100–180, div. A, title III, Sec. 311(a)(1), Dec. 4, 1987, 101 Stat. 1073, Sec. 2489; 

renumbered Sec. 2495a, Pub. L. 108–375, div. A, title VI, Sec. 651(b)(2), (c)(5), Oct. 28, 2004, 

118 Stat. 1971, 1972.) 

§ 2495b. Sale or rental of sexually explicit material prohibited 

(a) PROHIBITION OF SALE OR RENTAL.—The Secretary of Defense may not permit the sale or rental of sexually explicit material 

on property under the jurisdiction of the Department of Defense. 

(b) PROHIBITION OF OFFICIALLY PROVIDED SEXUALLY EXPLICIT

MATERIAL.—A member of the armed forces or a civilian officer or 

employee of the Department of Defense acting in an official capacity may not provide for sale, remuneration, or rental sexually explicit material to another person. 

(c) RESALE ACTIVITIES REVIEW BOARD.—(1) The Secretary of 

Defense shall establish a nine-member board to make recommendations to the Secretary regarding whether material sold or rented, 

or proposed for sale or rental, on property under the jurisdiction of 

the Department of Defense is barred from sale or rental by subsection (a). 

(2)(A) The Secretary of Defense shall appoint six members of 

the board to broadly represent the interests of the patron base 

served by the defense commissary system and the exchange system. The Secretary shall appoint one of the members to serve as 

the chairman of the board. At least one member appointed under 

this subparagraph shall be a person with experience managing or 

advocating for military family programs and who is also an eligible 

patron of the defense commissary system and the exchange system. 

(B) The Secretary of each of the military departments shall appoint one member of the board. 

(C) A vacancy on the board shall be filled in the same manner 

as the original appointment. 

(3) The Secretary of Defense may detail persons to serve as 

staff for the board. At a minimum, the Secretary shall ensure that 

the board is assisted at meetings by military resale and legal advisors. 

(4) The recommendations made by the board under paragraph 

(1) shall be made available to the public. The Secretary of Defense 

shall publicize the availability of such recommendations by such 

means as the Secretary considers appropriate. 

(5) Members of the board shall be allowed travel expense, including per diem in lieu of subsistence, at rates authorized for employees of agencies under subchapter I of chapter 57 of title 5 while 

away from their homes or regular places of business in the performance of services for the board. 

(d) REGULATIONS.—The Secretary of Defense shall prescribe 

regulations to implement this section. 

(e) DEFINITIONS.—In this section: 

(1) The term ‘‘sexually explicit material’’ means an audio 

recording, a film or video recording, or a periodical with visual 
1401 § 2495b CH. 147—MWR ACTIVITIES 

depictions, produced in any medium, the dominant theme of 

which depicts or describes nudity, including sexual or excretory 

activities or organs, in a lascivious way. 

(2) The term ‘‘property under the jurisdiction of the Department of Defense’’ includes commissaries, all facilities operated by the Army and Air Force Exchange Service, the Navy 

Exchange Service Command, the Navy Resale and Services 

Support Office, Marine Corps exchanges, and ships’ stores. 

(Added Pub. L. 104–201, div. A, title III, Sec. 343(a)(1), Sept. 23, 1996, 110 Stat. 2489, Sec. 

2489a; renumbered Sec. 2495b, Pub. L. 108–375, div. A, title VI, Sec. 651(b)(2), (c)(5), Oct. 28, 

2004, 118 Stat. 1971, 1972; Pub. L. 110–417, [div. A], title VI, Sec. 642(a), Oct. 14, 2008, 122 

Stat. 4493.) 
1402 

CHAPTER 148—NATIONAL DEFENSE TECHNOLOGY AND 

INDUSTRIAL BASE, DEFENSE REINVESTMENT, AND 

DEFENSE CONVERSION 

Subchapter Sec. 

I. Definitions ................................................................................................... 2500 

II. Policies and Planning ................................................................................. 2501 

III. Programs for Development, Application, and Support of Dual-Use 

Technologies ............................................................................................ 2511 

IV. Manufacturing Technology ........................................................................ 2521 

V. Miscellaneous Technology Base Policies and Programs .......................... 2531 

VI. Defense Export Loan Guarantees ............................................................. 2540 

VII. Critical Infrastructure Protection Loan Guarantees ............................... 2541 

SUBCHAPTER I—DEFINITIONS 

Sec. 

2500. Definitions. 

§ 2500. Definitions 

In this chapter: 

(1) The term ‘‘national technology and industrial base’’ 

means the persons and organizations that are engaged in research, development, production, integration, services, or information technology activities conducted within the United 

States and Canada. 

(2) The term ‘‘dual-use’’ with respect to products, services, 

standards, processes, or acquisition practices, means products, 

services, standards, processes, or acquisition practices, respectively, that are capable of meeting requirements for military 

and nonmilitary applications. 

(3) The term ‘‘dual-use critical technology’’ means a critical 

technology that has military applications and nonmilitary applications. 

(4) The term ‘‘technology and industrial base sector’’ means 

a group of public or private persons and organizations that engage in, or are capable of engaging in, similar research, development, production, integration, services, or information technology activities. 

(5) The terms ‘‘Federal laboratory’’ and ‘‘laboratory’’ have 

the meaning given the term ‘‘laboratory’’ in section 12(d)(2) of 

the Stevenson-Wydler Technology Innovation Act of 1980 (15 

U.S.C. 3710a(d)(2)), except that such terms include a federally 

funded research and development center sponsored by a Federal agency. 

(6) The term ‘‘critical technology’’ means a technology that 

is— 

(A) a national critical technology; or 

(B) a defense critical technology. 
1403 § 2500 CH. 148—DEFENSE INDUSTRIAL BASE 

(7) The term ‘‘national critical technology’’ means a technology that appears on the list of national critical technologies 

contained in the most recent biennial report on national critical technologies submitted to Congress by the President pursuant to section 603(d) of the National Science and Technology 

Policy, Organization, and Priorities Act of 1976 (42 U.S.C. 

6683(d)). 

(8) The term ‘‘defense critical technology’’ means a technology that is identified under section 2505 of this title as critical for attaining the national security objectives set forth in 

section 2501(a) of this title. 

(9) The term ‘‘eligible firm’’ means a company or other 

business entity that, as determined by the Secretary of Commerce— 

(A) conducts a significant level of its research, development, engineering, manufacturing, integration, services, 

and information technology activities in the United States; 

and 

(B) is a company or other business entity the majority 

ownership or control of which is by United States citizens 

or is a company or other business of a parent company 

that is incorporated in a country the government of 

which— 

(i) encourages the participation of firms so owned 

or controlled in research and development consortia to 

which the government of that country provides funding directly or provides funding indirectly through 

international organizations or agreements; and 

(ii) affords adequate and effective protection for 

the intellectual property rights of companies incorporated in the United States. 

Such term includes a consortium of such companies or other 

business entities, as determined by the Secretary of Commerce. 

(10) The term ‘‘manufacturing technology’’ means techniques and processes designed to improve manufacturing quality, productivity, and practices, including quality control, shop 

floor management, inventory management, and worker training, as well as manufacturing equipment and software. 

(11) The term ‘‘Small Business Innovation Research Program’’ means the program established under the following provisions of section 9 of the Small Business Act (15 U.S.C. 638): 

(A) Paragraphs (4) through (7) of subsection (b). 

(B) Subsections (e) through (l). 

(12) The term ‘‘Small Business Technology Transfer Program’’ means the program established under the following provisions of such section: 

(A) Paragraphs (4) through (7) of subsection (b). 

(B) Subsections (e) and (n) through (p). 

(13) The term ‘‘significant equity percentage’’ means— 

(A) a level of contribution and participation sufficient, 

when compared to the other non-Federal participants in 

the partnership or other cooperative arrangement involved, to demonstrate a comparable long-term financial 
§ 2501 CH. 148—DEFENSE INDUSTRIAL BASE 1404 

commitment to the product or process development involved; and 

(B) any other criteria the Secretary may consider necessary to ensure an appropriate equity mix among the participants. 

(14) The term ‘‘person of a foreign country’’ has the meaning given such term in section 3502(d) of the Primary Dealers 

Act of 1988 (22 U.S.C. 5342(d)). 

(15) The term ‘‘integration’’ means the process of providing 

systems engineering and technical direction for a system for 

the purpose of achieving capabilities that satisfy program requirements. 

(Added Pub. L. 102–484, div. D, title XLII, Sec. 4203(a), Oct. 23, 1992, 106 Stat. 2661, Sec. 2491; 

amended Pub. L. 103–160, div. A, title XI, Sec. 1182(a)(9), title XIII, Sec. 1315(f), Nov. 30, 1993, 

107 Stat. 1771, 1788; Pub. L. 103–337, div. A, title XI, Sec. 1113(d), 1115(e), Oct. 5, 1994, 108 

Stat. 2866, 2869; Pub. L. 104–106, div. A, title X, Sec. 1081(h), Feb. 10, 1996, 110 Stat. 455; 

renumbered Sec. 2500 and amended Pub. L. 105–85, div. A, title III, Sec. 371(b)(3), title X, Sec. 

1073(a)(53), Nov. 18, 1997, 111 Stat. 1705, 1903; Pub. L. 111–383, div. A, title VIII, Sec. 895(a), 

Jan. 7, 2011, 124 Stat. 4313.) 

SUBCHAPTER II—POLICIES AND PLANNING 

Sec. 

2501. National security objectives concerning national technology and industrial 

base. 

2502. National Defense Technology and Industrial Base Council. 

2503. National defense program for analysis of the technology and industrial 

base. 

2504. Annual report to Congress. 

2505. National technology and industrial base: periodic defense capability assessments. 

2506. National technology and industrial base: periodic defense capability plan. 

2507. Data collection authority of President. 

2508. Industrial Base Fund. 

§ 2501. National security objectives concerning national 

technology and industrial base 

(a) NATIONAL SECURITY OBJECTIVES FOR NATIONAL TECHNOLOGY AND INDUSTRIAL BASE.—It is the policy of Congress that 

the national technology and industrial base be capable of meeting 

the following national security objectives: 

(1) Supplying, equipping, and supporting the force structure of the armed forces that is necessary to achieve— 

(A) the objectives set forth in the national security 

strategy report submitted to Congress by the President 

pursuant to section 108 of the National Security Act of 

1947 (50 U.S.C. 404a); 

(B) the policy guidance of the Secretary of Defense 

provided pursuant to section 113(g) of this title; and 

(C) the future-years defense program submitted to 

Congress by the Secretary of Defense pursuant to section 

221 of this title. 

(2) Sustaining production, maintenance, repair, logistics, 

and other activities in support of military operations of various 

durations and intensity. 

(3) Maintaining advanced research and development activities to provide the armed forces with systems capable of ensuring technological superiority over potential adversaries. 
1405 § 2502 CH. 148—DEFENSE INDUSTRIAL BASE 

(4) Reconstituting within a reasonable period the capability to develop, produce, and support supplies and equipment, 

including technologically advanced systems, in sufficient quantities to prepare fully for a war, national emergency, or mobilization of the armed forces before the commencement of that 

war, national emergency, or mobilization. 

(5) Providing for the development, manufacture, and supply of items and technologies critical to the production and 

sustainment of advanced military weapon systems within the 

national technology and industrial base. 

(6) Providing for the generation of services capabilities 

that are not core functions of the armed forces and that are 

critical to military operations within the national technology 

and industrial base. 

(7) Providing for the development, production, and integration of information technology within the national technology 

and industrial base. 

(8) Maintaining critical design skills to ensure that the 

armed forces are provided with systems capable of ensuring 

technological superiority over potential adversaries. 

(b) CIVIL-MILITARY INTEGRATION POLICY.—It is the policy of 

Congress that the United States attain the national technology and 

industrial base objectives set forth in subsection (a) through acquisition policy reforms that have the following objectives: 

(1) Relying, to the maximum extent practicable, upon the 

commercial national technology and industrial base that is required to meet the national security needs of the United 

States. 

(2) Reducing the reliance of the Department of Defense on 

technology and industrial base sectors that are economically 

dependent on Department of Defense business. 

(3) Reducing Federal Government barriers to the use of 

commercial products, processes, and standards. 

(Added Pub. L. 102–484, div. D, title XLII, Sec. 4211, Oct. 23, 1992, 106 Stat. 2662; amended 

Pub. L. 103–35, title II, Sec. 201(c)(7), May 31, 1993, 107 Stat. 98; Pub. L. 103–160, div. A, title 

XI, Sec. 1182(a)(10), title XIII, Sec. 1313, Nov. 30, 1993, 107 Stat. 1771, 1786; Pub. L. 104–106, 

div. A, title X, Sec. 1081(a), Feb. 10, 1996, 110 Stat. 452; Pub. L. 104–201, div. A, title VIII, 

Sec. 829(a), Sept. 23, 1996, 110 Stat. 2612; Pub. L. 111–23, title III, Sec. 303(a), May 22, 2009, 

123 Stat. 1731; Pub. L. 111–383, div. A, title VIII, Sec. 895(b), Jan. 7, 2011, 124 Stat. 4314.) 

§ 2502. National Defense Technology and Industrial Base 

Council 

(a) ESTABLISHMENT.—There is a National Defense Technology 

and Industrial Base Council. 

(b) COMPOSITION.—The Council is composed of the following 

members: 

(1) The Secretary of Defense, who shall serve as chairman. 

(2) The Secretary of Energy. 

(3) The Secretary of Commerce. 

(4) The Secretary of Labor. 

(5) Such other officials as may be determined by the President. 

(c) RESPONSIBILITIES.—The Council shall have the responsibility to ensure effective cooperation among departments and agencies of the Federal Government, and to provide advice and rec-
§ 2503 CH. 148—DEFENSE INDUSTRIAL BASE 1406 

ommendations to the President, the Secretary of Defense, the Secretary of Energy, the Secretary of Commerce, and the Secretary of 

Labor, concerning— 

(1) the capabilities of the national technology and industrial base to meet the national security objectives set forth in 

section 2501(a) of this title; 

(2) programs for achieving such national security objectives; and 

(3) changes in acquisition policy that strengthen the national technology and industrial base. 

(d) ALTERNATIVE PERFORMANCE OF RESPONSIBILITIES.—Notwithstanding subsection (c), the President may assign the responsibilities of the Council to another interagency organization of the 

executive branch that includes among its members the officials 

specified in paragraphs (1) through (4) of subsection (b). 

(Added Pub. L. 102–484, div. D, title XLII, Sec. 4212(a), Oct. 23, 1992, 106 Stat. 2664; amended 

Pub. L. 103–160, div. A, title XIII, Sec. 1312(b), Nov. 30, 1993, 107 Stat. 1786; Pub. L. 103– 

337, div. A, title X, Sec. 1070(a)(12), Oct. 5, 1994, 108 Stat. 2856; Pub. L. 104–106, div. A, title 

X, Sec. 1081(b), Feb. 10, 1996, 110 Stat. 452; Pub. L. 104–201, div. A, title VIII, Sec. 829(c)(2), 

formerly Sec. 829(c)(2), (3), Sept. 23, 1996, 110 Stat. 2613, renumbered Pub. L. 105–85, div. A, 

title X, Sec. 1073(c)(7)(B), Nov. 18, 1997, 111 Stat. 1904; Pub. L. 105–85, div. A, title X, Sec. 

1073(c)(7)(A), Nov. 18, 1997, 111 Stat. 1904.) 

§ 2503. National defense program for analysis of the technology and industrial base 

(a) ESTABLISHMENT.—The Secretary of Defense shall establish 

a program for analysis of the national technology and industrial 

base. 

(b) SUPERVISION OF PROGRAM.—The Secretary of Defense shall 

carry out the program through the Under Secretary of Defense for 

Acquisition, Technology, and Logistics. In carrying out the program, the Under Secretary shall consult with the Secretary of Energy, the Secretary of Commerce, and the Secretary of Labor. 

(c) FUNCTIONS.—The functions of the program shall include, 

with respect to the national technology and industrial base, the following: 

(1) The assembly of timely and authoritative information. 

(2) Initiation of studies and analyses. 

(3) Provision of technical support and assistance to— 

(A) the Secretary of Defense for the preparation of the 

periodic assessments required by section 2505 of this title; 

(B) the defense acquisition university structure and its 

elements; and 

(C) other departments and agencies of the Federal 

Government in accordance with guidance established by 

the Council. 

(4) Dissemination, through the National Technical Information Service of the Department of Commerce, of unclassified 

information and assessments for further dissemination within 

the Federal Government and to the private sector. 

(Added Pub. L. 102–484, div. D, title XLII, Sec. 4213(a), Oct. 23, 1992, 106 Stat. 2665; amended 

Pub. L. 104–201, div. A, title VIII, Sec. 829(b), Sept. 23, 1996, 110 Stat. 2612; Pub. L. 107–107, 

div. A, title X, Sec. 1048(b)(4), Dec. 28, 2001, 115 Stat. 1225.) 
1407 § 2505 CH. 148—DEFENSE INDUSTRIAL BASE 

§ 2504. Annual report to Congress 

The Secretary of Defense shall transmit to the Committee on 

Armed Services of the Senate and the Committee on Armed Services of the House of Representatives by March 1 of each year a report which shall include the following information: 

(1) A description of the departmental guidance prepared 

pursuant to section 2506 of this title. 

(2) A description of the methods and analyses being undertaken by the Department of Defense alone or in cooperation 

with other Federal agencies, to identify and address concerns 

regarding technological and industrial capabilities of the national technology and industrial base. 

(3) A description of the assessments prepared pursuant to 

section 2505 of this title and other analyses used in developing 

the budget submission of the Department of Defense for the 

next fiscal year. 

(4) Identification of each program designed to sustain specific essential technological and industrial capabilities and 

processes of the national technology and industrial base. 

(Added Pub. L. 104–201, div. A, title VIII, Sec. 829(e), Sept. 23, 1996, 110 Stat. 2614; amended 

Pub. L. 106–65, div. A, title X, Sec. 1067(1), Oct. 5, 1999, 113 Stat. 774.) 

§ 2505. National technology and industrial base: periodic defense capability assessments 

(a) PERIODIC ASSESSMENT.—Each fiscal year, the Secretary of 

Defense shall prepare selected assessments of the capability of the 

national technology and industrial base to attain the national security objectives set forth in section 2501(a) of this title. The Secretary of Defense shall prepare such assessments in consultation 

with the Secretary of Commerce and the Secretary of Energy. 

(b) ASSESSMENT PROCESS.—The Secretary of Defense shall ensure that technology and industrial capability assessments— 

(1) describe sectors or capabilities, their underlying infrastructure and processes; 

(2) analyze present and projected financial performance of 

industries supporting the sectors or capabilities in the assessment; 

(3) identify technological and industrial capabilities and 

processes for which there is potential for the national industrial and technology base not to be able to support the achievement of national security objectives; and 

(4) consider the effects of the termination of major defense 

acquisition programs (as the term is defined in section 2430 of 

this title) or major automated information system programs (as 

defined in section 2445a of this title) in the previous fiscal year 

on the sectors and capabilities in the assessment. 

(c) ASSESSMENT OF EXTENT OF DEPENDENCY ON FOREIGN

SOURCE ITEMS.—Each assessment under subsection (a) shall include a separate discussion and presentation regarding the extent 

to which the national technology and industrial base is dependent 

on items for which the source of supply, manufacture, or technology 

is outside of the United States and Canada and for which there is 

no immediately available source in the United States or Canada. 
§ 2506 CH. 148—DEFENSE INDUSTRIAL BASE 1408 

The discussion and presentation regarding foreign dependency 

shall— 

(1) identify cases that pose an unacceptable risk of foreign 

dependency, as determined by the Secretary; and 

(2) present actions being taken or proposed to be taken to 

remedy the risk posed by the cases identified under paragraph 

(1), including efforts to develop a domestic source for the item 

in question. 

(d) INTEGRATED PROCESS.—The Secretary of Defense shall ensure that consideration of the technology and industrial base assessments is integrated into the overall budget, acquisition, and logistics support decision processes of the Department of Defense. 

(Added Pub. L. 102–484, div. D, title XLII, Sec. 4215, Oct. 23, 1992, 106 Stat. 2667; amended 

Pub. L. 103–35, title II, Sec. 201(g)(7), May 31, 1993, 107 Stat. 100; Pub. L. 104–201, div. A, 

title VIII, Sec. 829(c)(1), Sept. 23, 1996, 110 Stat. 2612; Pub. L. 111–23, title III, Sec. 303(b), 

May 22, 2009, 123 Stat. 1731; Pub. L. 111–383, div. A, title VIII, Sec. 895(c), Jan. 7, 2011, 124 

Stat. 4314.) 

§ 2506. Department of Defense technology and industrial 

base policy guidance 

(a) DEPARTMENTAL GUIDANCE.—The Secretary of Defense shall 

prescribe departmental guidance for the attainment of each of the 

national security objectives set forth in section 2501(a) of this title. 

Such guidance shall provide for technological and industrial capability considerations to be integrated into the strategy, management, budget allocation, acquisition, and logistics support decision 

processes. 

(b) REPORT TO CONGRESS.—The Secretary of Defense shall report on the implementation of the departmental guidance in the 

annual report to Congress submitted pursuant to section 2504 of 

this title. 

(Added Pub. L. 102–484, div. D, title XLII, Sec. 4216(a), Oct. 23, 1992, 106 Stat. 2668; amended 

Pub. L. 104–201, div. A, title VIII, Sec. 829(d), Sept. 23, 1996, 110 Stat. 2613; Pub. L. 111– 

383, div. A, title VIII, Sec. 895(d), Jan. 7, 2011, 124 Stat. 4314.) 

§ 2507. Data collection authority of President 

(a) AUTHORITY.—The President shall be entitled, by regulation, 

subpoena, or otherwise, to obtain such information from, require 

such reports and the keeping of such records by, make such inspection of the books, records, and other writings, premises or property 

of, and take the sworn testimony of, and administer oaths and affirmations to, any person as may be necessary or appropriate, in 

the President’s discretion, to the enforcement or the administration 

of this chapter and the regulations issued under this chapter. 

(b) CONDITION FOR USE OF AUTHORITY.—The President shall 

issue regulations insuring that the authority of this section will be 

used only after the scope and purpose of the investigation, inspection, or inquiry to be made have been defined by competent authority and it is assured that no adequate and authoritative data are 

available from any Federal or other responsible agency. 

(c) PENALTY FOR NONCOMPLIANCE.—Any person who willfully 

performs any act prohibited or willfully fails to perform any act required by the provisions of subsection (a), or any rule, regulation, 

or order thereunder, shall be fined under title 18 or imprisoned not 

more than one year, or both. 
1409 § 2508 CH. 148—DEFENSE INDUSTRIAL BASE 

(d) LIMITATIONS ON DISCLOSURE OF INFORMATION.—Information obtained under subsection (a) which the President 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 President determines that the 

withholding thereof is contrary to the interest of the national defense. Any person who willfully violates this subsection shall be 

fined under title 18 or imprisoned not more than one year, or both. 

(e) REGULATIONS.—The President may make such rules, regulations, and orders as he considers necessary or appropriate to 

carry out the provisions of this section. Any regulation or order 

under this section may be established in such form and manner, 

may contain such classification and differentiations, and may provide for such adjustments and reasonable exceptions as in the judgment of the President are necessary or proper to effectuate the purposes of this section, or to prevent circumvention or evasion, or to 

facilitate enforcement of this section, or any rule, regulation, or 

order issued under this section. 

(f) DEFINITIONS.—In this section: 

(1) The term ‘‘person’’ includes an individual, corporation, 

partnership, association, or any other organized group of persons, or legal successor or representative of the foregoing, and 

includes the United States or any agency thereof, or any other 

government, or any of its political subdivisions, or any agency 

of any of the foregoing, except that no punishment provided by 

this section shall apply to the United States, or to any such 

government, political subdivision, or government agency. 

(2) The term ‘‘national defense’’ means programs for military and atomic energy production or construction, military assistance to any foreign nation, stockpiling, space, and directly 

related activity. 

(Added Pub. L. 102–484, div. D, title XLII, Sec. 4217, Oct. 23, 1992, 106 Stat. 2670; amended 

Pub. L. 103–160, div. A, title XI, Sec. 1182(b)(1), Nov. 30, 1993, 107 Stat. 1772; Pub. L. 109– 

163, div. A, title X, Sec. 1056(c)(5), Jan. 6, 2006, 119 Stat. 3439.) 

§ 2508. Industrial Base Fund 

(a) ESTABLISHMENT.—The Secretary of Defense shall establish 

an Industrial Base Fund (in this section referred to as the ‘‘Fund’’). 

(b) CONTROL OF FUND.—The Fund shall be under the control 

of the Under Secretary of Defense for Acquisition, Technology, and 

Logistics, acting through the Deputy Assistant Secretary of Defense 

for Manufacturing and Industrial Base Policy. 

(c) AMOUNTS IN FUND.—The Fund shall consist of amounts appropriated or otherwise made available to the Fund. 

(d) USE OF FUND.—Subject to subsection (e), the Fund shall be 

used— 

(1) to support the monitoring and assessment of the industrial base required by this chapter; 

(2) to address critical issues in the industrial base relating 

to urgent operational needs; 

(3) to support efforts to expand the industrial base; and 

(4) to address supply chain vulnerabilities. 

(e) USE OF FUND SUBJECT TO APPROPRIATIONS.—The authority 

of the Secretary of Defense to use the Fund under this section in 
§ 2511 CH. 148—DEFENSE INDUSTRIAL BASE 1410 

any fiscal year is subject to the availability of appropriations for 

that purpose. 

(f) EXPENDITURES.—The Secretary shall establish procedures 

for expending monies in the Fund in support of the uses identified 

in subsection (d), including the following: 

(1) Direct obligations from the Fund. 

(2) Transfers of monies from the Fund to relevant appropriations of the Department of Defense. 

(Added Pub. L. 111–383, div. A, title VIII, Sec. 896(b)(1), Jan. 7, 2011, 124 Stat. 4315.) 

SUBCHAPTER III—PROGRAMS FOR DEVELOPMENT, APPLICATION, AND SUPPORT OF DUAL-USE TECHNOLOGIES 

Sec. 

2511. Defense dual-use critical technology program. 

[2512, 2513. Repealed.] 

2514. Encouragement of technology transfer. 

2515. Office of Technology Transition. 

[2516. Repealed.] 

2517. Office for Foreign Defense Critical Technology Monitoring and Assessment. 

2518. Overseas foreign critical technology monitoring and assessment financial 

assistance program. 

2519. Federal Defense Laboratory Diversification Program. 

[2520. Repealed.] 

§ 2511. Defense dual-use critical technology program 

(a) ESTABLISHMENT OF PROGRAM.—The Secretary of Defense 

shall conduct a program to further the national security objectives 

set forth in section 2501(a) of this title by encouraging and providing for research, development, and application of dual-use critical technologies. The Secretary may make grants, enter into contracts, or enter into cooperative agreements and other transactions 

pursuant to section 2371 of this title in furtherance of the program. 

The Secretary shall identify projects to be conducted as part of the 

program. 

(b) ASSISTANCE AUTHORIZED.—The Secretary of Defense may 

provide technical and other assistance to facilitate the achievement 

of the purposes of projects conducted under the program. In providing such assistance, the Secretary shall make available, as appropriate for the work to be performed, equipment and facilities of 

Department of Defense laboratories (including the scientists and 

engineers at those laboratories) for purposes of projects selected by 

the Secretary. 

(c) FINANCIAL COMMITMENT OF NON-FEDERAL GOVERNMENT

PARTICIPANTS.—(1) The total amount of funds provided by the Federal Government for a project conducted under the program may 

not exceed 50 percent of the total cost of the project. However, the 

Secretary of Defense may agree to a project in which the total 

amount of funds provided by the Federal Government exceeds 50 

percent if the Secretary determines the project is particularly meritorious, but the project would not otherwise have sufficient nonFederal funding or in-kind contributions. 

(2) The Secretary may prescribe regulations to provide for consideration of in-kind contributions by non-Federal Government participants in a project conducted under the program for the purpose 

of calculating the share of the project costs that has been or is 
1411 [§ 2512 CH. 148—DEFENSE INDUSTRIAL BASE 

being undertaken by such participants. In such regulations, the 

Secretary may authorize a participant that is a small business concern to use funds received under the Small Business Innovation 

Research Program or the Small Business Technology Transfer Program to help pay the costs of project activities. Any such funds so 

used may be considered in calculating the amount of the financial 

commitment undertaken by the non-Federal Government participants unless the Secretary determines that the small business concern has not made a significant equity percentage contribution in 

the project from non-Federal sources. 

(3) The Secretary shall consider a project proposal submitted 

by a small business concern without regard to the ability of the 

small business concern to immediately meet its share of the anticipated project costs. Upon the selection of a project proposal submitted by a small business concern, the small business concern 

shall have a period of not less than 120 days in which to arrange 

to meet its financial commitment requirements under the project 

from sources other than a person of a foreign country. If the Secretary determines upon the expiration of that period that the small 

business concern will be unable to meet its share of the anticipated 

project costs, the Secretary shall revoke the selection of the project 

proposal submitted by the small business concern. 

(d) SELECTION PROCESS.—Competitive procedures shall be used 

in the conduct of the program. 

(e) SELECTION CRITERIA.—The criteria for the selection of 

projects under the program shall include the following: 

(1) The extent to which the proposed project advances and 

enhances the national security objectives set forth in section 

2501(a) of this title. 

(2) The technical excellence of the proposed project. 

(3) The qualifications of the personnel proposed to participate in the research activities of the proposed project. 

(4) An assessment of timely private sector investment in 

activities to achieve the goals and objectives of the proposed 

project other than through the project. 

(5) The potential effectiveness of the project in the further 

development and application of each technology proposed to be 

developed by the project for the national technology and industrial base. 

(6) The extent of the financial commitment of eligible firms 

to the proposed project. 

(7) The extent to which the project does not unnecessarily 

duplicate projects undertaken by other agencies. 

(f) REGULATIONS.—The Secretary of Defense shall prescribe 

regulations for the purposes of this section. 

(Added Pub. L. 102–484, div. D, title XLII, Sec. 4221(a), Oct. 23, 1992, 106 Stat. 2677; amended 

Pub. L. 103–160, div. A, title XIII, Sec. 1315(a), 1317(c), Nov. 30, 1993, 107 Stat. 1787, 1789; 

Pub. L. 103–337, div. A, title XI, Sec. 1115(a), Oct. 5, 1994, 108 Stat. 2868; Pub. L. 104–106, 

div. A, title X, Sec. 1081(c), Feb. 10, 1996, 110 Stat. 452.) 

[§§ 2512, 2513. Repealed. Pub. L. 104–106, div. A, title X, Sec. 

1081(f), Feb. 10, 1996, 110 Stat. 454] 
§ 2514 CH. 148—DEFENSE INDUSTRIAL BASE 1412 

§ 2514. Encouragement of technology transfer 

(a) ENCOURAGEMENT OF TRANSFER REQUIRED.—The Secretary 

of Defense shall encourage, to the extent consistent with national 

security objectives, the transfer of technology between laboratories 

and research centers of the Department of Defense and other Federal agencies, State and local governments, colleges and universities, and private persons in cases that are likely to result in accomplishing the objectives set forth in section 2501(a) of this title. 

(b) EXAMINATION AND IMPLEMENTATION OF METHODS TO EN- COURAGE TRANSFER.—The Secretary shall examine and implement 

methods, in addition to the encouragement referred to in subsection (a) and the program described in subsection (c), that are 

consistent with national security objectives and will enable Department of Defense personnel to promote technology transfer. 

(c) PROGRAM TO ENCOURAGE DIVERSIFICATION OF DEFENSE

LABORATORIES.—(1) The Secretary of Defense shall establish and 

implement a program to be known as the Federal Defense Laboratory Diversification Program (hereinafter in this subsection referred to as the ‘‘Program’’). The purpose of the Program shall be 

to encourage greater cooperation in research and production activities carried out by defense laboratories and by private industry of 

the United States in order to enhance and improve the products of 

such research and production activities. 

(2) Under the Program, the defense laboratories, in coordination with the Office of Technology Transfer in the Office of the Secretary of Defense, shall carry out cooperative activities with private 

industry in order to promote (by the use or exchange of patents, licenses, cooperative research and development agreements and 

other cooperative agreements, and the use of symposia, meetings, 

and other similar mechanisms) the transfer of defense or dual-use 

technologies from the defense laboratories to private industry, and 

the development and application of such technologies by the defense laboratories and private industry, for the purpose of the commercial utilization of such technologies by private industry. 

(3) The Secretary of Defense shall develop and annually update 

a plan for each defense laboratory that participates in the Program 

under which plan the laboratory shall carry out cooperative activities with private industry to promote the transfers described in 

subsection (b). 

(4) In this subsection, the term ‘‘defense laboratory’’ means any 

laboratory owned or operated by the Department of Defense that 

carries out research in fiscal year 1993 in an amount in excess of 

$50,000,000. 

(Added Pub. L. 102–484, div. D, title XLII, Sec. 4224(a), Oct. 23, 1992, 106 Stat. 2682; amended 

Pub. L. 104–201, div. A, title VIII, Sec. 829(f), Sept. 23, 1996, 110 Stat. 2614.) 

§ 2515. Office of Technology Transition 

(a) ESTABLISHMENT.—The Secretary of Defense shall establish 

within the Office of the Secretary of Defense an Office of Technology Transition. 

(b) PURPOSE.—The purpose of the office shall be to ensure, to 

the maximum extent practicable, that technology developed for national security purposes is integrated into the private sector of the 

United States in order to enhance national technology and indus-
1413 § 2517 CH. 148—DEFENSE INDUSTRIAL BASE 

trial base, reinvestment, and conversion activities consistent with 

the objectives set forth in section 2501(a) of this title. 

(c) DUTIES.—The head of the office shall ensure that the office— 

(1) monitors all research and development activities that 

are carried out by or for the military departments and Defense 

Agencies; 

(2) identifies all such research and development activities 

that use technologies, or result in technological advancements, 

having potential nondefense commercial applications; 

(3) serves as a clearinghouse for, coordinates, and otherwise actively facilitates the transition of such technologies and 

technological advancements from the Department of Defense to 

the private sector; 

(4) conducts its activities in consultation and coordination 

with the Department of Energy and the Department of Commerce; and 

(5) provides private firms with assistance to resolve problems associated with security clearances, proprietary rights, 

and other legal considerations involved in such a transition of 

technology. 

(d) BIENNIAL REPORT.—The Secretary of Defense shall submit 

to the congressional defense committees a biennial report on the 

activities of the Office. The report shall be submitted each evennumbered year at the same time that the budget is submitted to 

Congress by the President pursuant to section 1105 of title 31. The 

report shall contain a discussion of the accomplishments of the Office during the two fiscals year preceding the fiscal year in which 

the report is submitted. 

(Added Pub. L. 102–484, div. D, title XLII, Sec. 4225(a), Oct. 23, 1992, 106 Stat. 2683; Pub. L. 

104–106, div. A, title XV, Sec. 1502(a)(22), Feb. 10, 1996, 110 Stat. 505; Pub. L. 106–65, div. 

A, title X, Sec. 1067(1), Oct. 5, 1999, 113 Stat. 774; Pub. L. 108–136, div. A, title X, Sec. 

1031(a)(23), Nov. 24, 2003, 117 Stat. 1598; Pub. L. 108–375, div. A, title X, Sec. 1084(b)(3), Oct. 

28, 2004, 118 Stat. 2060.) 

[§ 2516. Repealed. Pub. L. 104–106, div. A, title X, Sec. 

1081(g), Feb. 10, 1996, 110 Stat. 455] 

§ 2517. Office for Foreign Defense Critical Technology Monitoring and Assessment 

(a) IN GENERAL.—The Secretary of Defense shall establish 

within the Office of the Assistant Secretary of Defense for Research 

and Engineering an office known as the ‘‘Office for Foreign Defense 

Critical Technology Monitoring and Assessment’’ (hereinafter in 

this section referred to as the ‘‘Office’’). 

(b) RELATIONSHIP TO DEPARTMENT OF COMMERCE.—The head 

of the Office shall consult closely with appropriate officials of the 

Department of Commerce in order— 

(1) to minimize the duplication of any effort of the Department of Commerce by the Department of Defense regarding 

the monitoring of foreign activities related to defense critical 

technologies that have potential commercial uses; and 

(2) to ensure that the Office is effectively utilized to disseminate information to users of such information within the 

Federal Government. 
§ 2518 CH. 148—DEFENSE INDUSTRIAL BASE 1414 

(c) RESPONSIBILITIES.—The Office shall have the following responsibilities: 

(1) To maintain within the Department of Defense a central library for the compilation and appropriate dissemination 

of unclassified and classified information and assessments regarding significant foreign activities in research, development, 

and applications of defense critical technologies. 

(2) To establish and maintain— 

(A) a widely accessible unclassified data base of information and assessments regarding foreign science and 

technology activities that involve defense critical technologies, including, especially, activities in Europe and in 

Pacific Rim countries; and 

(B) a classified data base of information and assessments regarding such activities. 

(3) To perform liaison activities among the military departments, Defense Agencies, and other appropriate elements of 

the Department of Defense, with appropriate agencies and offices of the Department of Commerce and the Department of 

State, and with other departments and agencies of the Federal 

Government in order to ensure that significant activities in research, development, and applications of defense critical technologies are identified, monitored, and assessed by an appropriate department or agency of the Federal Government. 

(4) To ensure the maximum practicable public availability 

of information and assessments contained in the unclassified 

data bases established pursuant to paragraph (2)— 

(A) by limiting, to the maximum practicable extent, restrictive classification of such information and assessments; and 

(B) by disseminating to the National Technical Information Service of the Department of Commerce information and assessments regarding defense critical technologies having potential commercial uses. 

(5) To disseminate through the National Technical Information Service of the Department of Commerce unclassified information and assessments regarding defense critical technologies having potential commercial uses so that such information and assessments may be further disseminated within 

the Federal Government and to the private sector. 

(Added Pub. L. 102–190, div. A, title VIII, Sec. 821(a), Dec. 5, 1991, 105 Stat. 1430, Sec. 2525; 

renumbered Sec. 2517 and amended Pub. L. 102–484, div. D, title XLII, Sec. 4227, Oct. 23, 1992, 

106 Stat. 2685; Pub. L. 111–383, div. A, title IX, Sec. 901(j)(4), Jan. 7, 2011, 124 Stat. 4324.) 

§ 2518. Overseas foreign critical technology monitoring and 

assessment financial assistance program 

(a) ESTABLISHMENT AND PURPOSE OF PROGRAM.—The Secretary 

of Defense may establish a foreign critical technology monitoring 

and assessment program. Under the program, the Secretary may 

enter into cooperative arrangements with one or more eligible notfor-profit organizations in order to provide financial assistance for 

the establishment of foreign critical technology monitoring and assessment offices in Europe, Pacific Rim countries, and such other 

countries as the Secretary considers appropriate. 
1415 § 2519 CH. 148—DEFENSE INDUSTRIAL BASE 

(b) ELIGIBLE ORGANIZATIONS.—Any not-for-profit industrial or 

professional organization that has economic and scientific interests 

in research, development, and applications of dual-use critical technologies is eligible to enter into a cooperative arrangement referred 

to in subsection (a). 

(Added Pub. L. 102–190, div. A, title VIII, Sec. 821(a), Dec. 5, 1991, 105 Stat. 1431, Sec. 2526; 

renumbered Sec. 2518, Pub. L. 102–484, div. D, title XLII, Sec. 4228, Oct. 23, 1992, 106 Stat. 

2685.) 

§ 2519. Federal Defense Laboratory Diversification Program 

(a) ESTABLISHMENT OF PROGRAM.—The Secretary of Defense 

shall conduct a program in accordance with this section for the purpose of promoting cooperation between Department of Defense laboratories and industry on research and development of dual-use 

technologies in order to further the national security objectives set 

forth in section 2501(a) of this title. 

(b) PARTNERSHIPS.—(1) The Secretary shall provide for the establishment under the program of cooperative arrangements (hereinafter in this section referred to as ‘‘partnerships’’) between a Department of Defense laboratory and eligible firms and nonprofit research corporations. A partnership may also include one or more 

additional Federal laboratories, institutions of higher education, 

agencies of State and local governments, and other entities, as determined appropriate by the Secretary. 

(2) For purposes of this section, a federally funded research 

and development center shall be considered a Department of Defense laboratory if the center is sponsored by the Department of 

Defense. 

(c) ASSISTANCE AUTHORIZED.—(1) The Secretary may make 

grants, enter into contracts, enter into cooperative agreements and 

other transactions pursuant to section 2371 of this title, and enter 

into cooperative research and development agreements under section 12 of the Stevenson-Wydler Technology Innovation Act of 1980 

(15 U.S.C. 3710a) in order to establish partnerships. 

(2) Subject to subsection (d), the Secretary may provide a partnership with technical and other assistance in order to facilitate 

the achievement of the purpose of this section. 

(d) FINANCIAL COMMITMENT OF NON-FEDERAL GOVERNMENT

PARTICIPANTS.—(1) The Secretary shall ensure that the non-Federal Government participants in a partnership make a substantial 

contribution to the total cost of partnership activities. The amount 

of the contribution shall be commensurate with the risk undertaken by such participants and the potential benefits of the activities for such participants. 

(2) The regulations prescribed pursuant to section 2511(c)(2) of 

this title shall apply to in-kind contributions made by non-Federal 

Government participants in a partnership. 

(e) SELECTION PROCESS.—Competitive procedures shall be used 

in the establishment of partnerships. 

(f) SELECTION CRITERIA.—The criteria for the selection of a proposed partnership for establishment under this section shall include the criteria set forth in section 2511(e) of this title. 

(g) REGULATIONS.—The Secretary shall prescribe regulations 

for the purposes of this section. 
[§ 2520 CH. 148—DEFENSE INDUSTRIAL BASE 1416 

(Added Pub. L. 103–337, div. A, title XI, Sec. 1113(a), Oct. 5, 1994, 108 Stat. 2864; amended 

Pub. L. 104–106, div. A, title X, Sec. 1081(d), Feb. 10, 1996, 110 Stat. 454.) 

[§ 2520. Repealed. Pub. L. 104–106, div. A, title X, Sec. 

1081(f), Feb. 10, 1996, 110 Stat. 454] 

SUBCHAPTER IV—MANUFACTURING TECHNOLOGY 

Sec. 

2521. Manufacturing Technology Program. 

2522. Armament retooling and manufacturing. 

[2523, 2524. Repealed.] 

[2525. Renumbered 2521.] 

§ 2521. Manufacturing Technology Program 

(a) ESTABLISHMENT.—The Secretary of Defense shall establish 

a Manufacturing Technology Program to further the national security objectives of section 2501(a) of this title through the development and application of advanced manufacturing technologies and 

processes that will reduce the acquisition and supportability costs 

of defense weapon systems and reduce manufacturing and repair 

cycle times across the life cycles of such systems. The Secretary 

shall use the joint planning process of the directors of the Department of Defense laboratories in establishing the program. The 

Under Secretary of Defense for Acquisition, Technology, and Logistics shall administer the program. 

(b) PURPOSE OF PROGRAM.—The Secretary of Defense shall use 

the program— 

(1) to provide centralized guidance and direction (including 

goals, milestones, and priorities) to the military departments 

and the Defense Agencies on all matters relating to manufacturing technology; 

(2) to direct the development and implementation of Department of Defense plans, programs, projects, activities, and 

policies that promote the development and application of advanced technologies to manufacturing processes, tools, and 

equipment; 

(3) to improve the manufacturing quality, productivity, 

technology, and practices of businesses and workers providing 

goods and services to the Department of Defense; 

(4) to focus Department of Defense support for the development and application of advanced manufacturing technologies 

and processes for use to meet manufacturing requirements 

that are essential to the national defense, as well as for repair 

and remanufacturing in support of the operations of systems 

commands, depots, air logistics centers, and shipyards; 

(5) to disseminate information concerning improved manufacturing improvement concepts, including information on such 

matters as best manufacturing practices, product data exchange specifications, computer-aided acquisition and logistics 

support, and rapid acquisition of manufactured parts; 

(6) to sustain and enhance the skills and capabilities of the 

manufacturing work force; 

(7) to promote high-performance work systems (with development and dissemination of production technologies that 
1417 § 2521 CH. 148—DEFENSE INDUSTRIAL BASE 

build upon the skills and capabilities of the work force), high 

levels of worker education and training; and 

(8) to ensure appropriate coordination between the manufacturing technology programs and industrial preparedness 

programs of the Department of Defense and similar programs 

undertaken by other departments and agencies of the Federal 

Government or by the private sector. 

(c) EXECUTION.—(1) The Secretary may carry out projects 

under the program through the Secretaries of the military departments and the heads of the Defense Agencies. 

(2) In the establishment and review of requirements for an advanced manufacturing technology or process, the Secretary shall 

ensure the participation of those prospective technology users that 

are expected to be the users of that technology or process. 

(3) The Secretary shall ensure that each project under the program for the development of an advanced manufacturing technology or process includes an implementation plan for the transition of that technology or process to the prospective technology 

users that will be the users of that technology or process. 

(4) In the periodic review of a project under the program, the 

Secretary shall ensure participation by those prospective technology users that are the expected users for the technology or process being developed under the project. 

(5) In order to promote increased dissemination and use of 

manufacturing technology throughout the national defense technology and industrial base, the Secretary shall seek, to the maximum extent practicable, the participation of manufacturers of 

manufacturing equipment in the projects under the program. 

(6) In this subsection, the term ‘‘prospective technology users’’ 

means the following officials and elements of the Department of 

Defense: 

(A) Program and project managers for defense weapon systems. 

(B) Systems commands. 

(C) Depots. 

(D) Air logistics centers. 

(E) Shipyards. 

(d) COMPETITION AND COST SHARING.—(1) In accordance with 

the policy stated in section 2374 of this title, competitive procedures shall be used for awarding all grants and entering into all 

contracts, cooperative agreements, and other transactions under 

the program. 

(2) Under the competitive procedures used, the factors to be 

considered in the evaluation of each proposed grant, contract, cooperative agreement, or other transaction for a project under the program shall include the extent to which that proposed transaction 

provides for the proposed recipient to share in the cost of the 

project. For a project for which the Government receives an offer 

from only one offeror, the contracting officer shall negotiate the 

ratio of contract recipient cost to Government cost that represents 

the best value to the Government. 

(e) JOINT DEFENSE MANUFACTURING TECHNOLOGY PANEL.—(1) 

There is in the Department of Defense the Joint Defense Manufacturing Technology Panel. 
§ 2521 CH. 148—DEFENSE INDUSTRIAL BASE 1418 

1 In section 2521(e)(5), ‘‘Director of Defense Research and Engineering’’ should be ‘‘Assistant 

Secretary of Defense for Research and Engineering’’. 

(2)(A) The Chair of the Joint Defense Manufacturing Technology Panel shall be the head of the Panel. The Chair shall be appointed, on a rotating basis, from among the appropriate personnel 

of the military departments and Defense Agencies with manufacturing technology programs. 

(B) The Panel shall be composed of at least one individual from 

among appropriate personnel of each military department and Defense Agency with manufacturing technology programs. The Panel 

may include as ex-officio members such individuals from other government organizations, academia, and industry as the Chair considers appropriate. 

(3) The purposes of the Panel shall be as follows: 

(A) To identify and integrate requirements for the program. 

(B) To conduct joint planning for the program. 

(C) To develop joint strategies for the program. 

(4) In carrying out the purposes specified in paragraph (3), the 

Panel shall perform the functions as follows: 

(A) Conduct comprehensive reviews and assessments of defense-related manufacturing issues being addressed by the 

manufacturing technology programs and related activities of 

the Department of Defense. 

(B) Execute strategic planning to identify joint planning 

opportunities for increased cooperation in the development and 

implementation of technological products and the leveraging of 

funding for such purposes with the private sector and other 

government agencies. 

(C) Ensure the integration and coordination of requirements and programs under the program with the Office of the 

Secretary of Defense and other national-level initiatives, including the establishment of information exchange processes 

with other government agencies, private industry, academia, 

and professional associations. 

(D) Conduct such other functions as the Under Secretary 

of Defense for Acquisition, Technology, and Logistics shall 

specify. 

(5) The Panel shall report to and receive direction from the Director of Defense Research and Engineering 1 on manufacturing 

technology issues of multi-service concern and application. 

(6) The administrative expenses of the Panel shall be borne by 

each military department and Defense Agency with manufacturing 

technology programs in such manner as the Panel shall provide. 

(f) FIVE-YEAR STRATEGIC PLAN.—(1) The Secretary shall develop a plan for the program that includes the following: 

(A) The overall manufacturing technology goals, milestones, priorities, and investment strategy for the program. 

(B) The objectives of, and funding for, the program for each 

military department and each Defense Agency that shall participate in the program during the period of the plan. 

(2) The Secretary shall include in the plan mechanisms for assessing the effectiveness of the program under the plan. 
1419 § 2531 CH. 148—DEFENSE INDUSTRIAL BASE 

(3) The Secretary shall update the plan on a biennial basis. 

(4) Each plan, and each update to the plan, shall cover a period 

of five fiscal years. 

(Added Pub. L. 103–160, div. A, title VIII, Sec. 801(a)(1), Nov. 30, 1993, 107 Stat. 1700, Sec. 

2525; amended Pub. L. 103–337, div. A, title II, Sec. 256(a)(1), Oct. 5, 1994, 108 Stat. 2704; Pub. 

L. 104–106, div. A, title II, Sec. 276(a), title X, Sec. 1081(e), title XV, Sec. 1503(a)(28), Feb. 10, 

1996, 110 Stat. 241, 454, 512; Pub. L. 105–85, div. A, title II, Sec. 211(a), (b), Nov. 18, 1997, 

111 Stat. 1657; Pub. L. 105–261, div. A, title II, Sec. 213, Oct. 17, 1998, 112 Stat. 1947; Pub. 

L. 106–65, div. A, title II, Sec. 216, Oct. 5, 1999, 113 Stat. 543; renumbered Sec. 2521, Pub. 

L. 106–398, Sec. 1 [[div. A], title III, Sec. 344(c)(1)(A)], Oct. 30, 2000, 114 Stat. 1654, 1654A– 

71; Pub. L. 107–107, div. A, title X, Sec. 1048(b)(2), Dec. 28, 2001, 115 Stat. 1225; Pub. L. 107– 

314, div. A, title II, Sec. 213, Dec. 2, 2002, 116 Stat. 2481; Pub. L. 108–136, div. A, title X, Sec. 

1031(a)(24), Nov. 24, 2003, 117 Stat. 1598; Pub. L. 110–181, div. A, title II, Sec. 238(a), Jan. 

28, 2008, 122 Stat. 48; Pub. L. 111–84, div. A, title II, Sec. 212, Oct. 28, 2009, 123 Stat. 2225.) 

§ 2522. Armament retooling and manufacturing 

The Secretary of the Army is authorized by chapter 434 of this 

title to carry out programs for the support of armaments retooling 

and manufacturing in the national defense industrial and technology base. 

(Added Pub. L. 106–398, Sec. 1 [[div. A], title III, Sec. 344(c)(1)(B)], Oct. 30, 2000, 114 Stat. 

1654, 1654A–71.) 

[§§ 2523, 2524. Repealed. Pub. L. 104–106, div. A, title X, Sec. 

1081(f), Feb. 10, 1996, 110 Stat. 454] 

[§ 2525. Renumbered 2521] 

SUBCHAPTER V—MISCELLANEOUS TECHNOLOGY BASE 

POLICIES AND PROGRAMS 

Sec. 

2531. Defense memoranda of understanding and related agreements. 

2532. Offset policy; notification. 

2533. Determinations of public interest under chapter 83 of title 41. 

2533a. Requirement to buy certain articles from American sources; exceptions. 

2533b. Requirement to buy strategic materials critical to national security from 

American sources; exceptions. 

2534. Miscellaneous limitations on the procurement of goods other than United 

States goods. 

2535. Defense Industrial Reserve. 

2536. Award of certain contracts to entities controlled by a foreign government: 

prohibition. 

2537. Improved national defense control of technology diversions overseas. 

2538. Industrial mobilization: orders; priorities; possession of manufacturing 

plants; violations. 

2539. Industrial mobilization: plants; lists. 

2539a. Industrial mobilization: Board on Mobilization of Industries Essential for 

Military Preparedness. 

2539b. Availability of samples, drawings, information, equipment, materials, and 

certain services. 

§ 2531. Defense memoranda of understanding and related 

agreements 

(a) CONSIDERATIONS IN MAKING AND IMPLEMENTING MOUS AND

RELATED AGREEMENTS.—In the negotiation, renegotiation, and implementation of any existing or proposed memorandum of understanding, or any existing or proposed agreement related to a memorandum of understanding, between the Secretary of Defense, acting 

on behalf of the United States, and one or more foreign countries 

(or any instrumentality of a foreign country) relating to research, 

development, or production of defense equipment, or to the recip-
§ 2532 CH. 148—DEFENSE INDUSTRIAL BASE 1420 

rocal procurement of defense items, the Secretary of Defense 

shall— 

(1) consider the effects of such existing or proposed memorandum of understanding or related agreement on the defense 

technology and industrial base of the United States; and 

(2) regularly solicit and consider comments and recommendations from the Secretary of Commerce with respect to 

the commercial implications of such memorandum of understanding or related agreement and the potential effects of such 

memorandum of understanding or related agreement on the 

international competitive position of United States industry. 

(b) INTER-AGENCY REVIEW OF EFFECTS ON UNITED STATES INDUSTRY.—Whenever the Secretary of Commerce has reason to believe that an existing or proposed memorandum of understanding 

or related agreement has, or threatens to have, a significant adverse effect on the international competitive position of United 

States industry, the Secretary may request an inter-agency review 

of the memorandum of understanding or related agreement. If, as 

a result of the review, the Secretary determines that the commercial interests of the United States are not being served or would 

not be served by adhering to the terms of such existing memorandum or related agreement or agreeing to such proposed memorandum or related agreement, as the case may be, the Secretary 

shall recommend to the President the renegotiation of the existing 

memorandum or related agreement or any modification to the proposed memorandum of understanding or related agreement that he 

considers necessary to ensure an appropriate balance of interests. 

(c) LIMITATION ON ENTERING INTO MOUS AND RELATED AGREEMENTS.—A memorandum of understanding or related agreement 

referred to in subsection (a) may not be entered into or implemented if the President, taking into consideration the results of the 

inter-agency review, determines that such memorandum of understanding or related agreement has or is likely to have a significant 

adverse effect on United States industry that outweighs the benefits of entering into or implementing such memorandum or agreement. 

(Added Pub. L. 100–456, div. A, title VIII, Sec. 824, Sept. 29, 1988, 102 Stat. 2019, Sec. 2504; 

amended Pub. L. 101–189, div. A, title VIII, Sec. 815(a), Nov. 29, 1989, 103 Stat. 1500; Pub. 

L. 101–510, div. A, title XIV, Sec. 1453, Nov. 5, 1990, 104 Stat. 1694; renumbered Sec. 2531 

and amended Pub. L. 102–484, div. D, title XLII, Sec. 4202(a), 4271(c), Oct. 23, 1992, 106 Stat. 

2659, 2696.) 

§ 2532. Offset policy; notification 

(a) ESTABLISHMENT OF OFFSET POLICY.—The President shall 

establish, consistent with the requirements of this section, a comprehensive policy with respect to contractual offset arrangements 

in connection with the purchase of defense equipment or supplies 

which addresses the following: 

(1) Transfer of technology in connection with offset arrangements. 

(2) Application of offset arrangements, including cases in 

which United States funds are used to finance the purchase by 

a foreign government. 
1421 § 2533 CH. 148—DEFENSE INDUSTRIAL BASE 

(3) Effects of offset arrangements on specific subsectors of 

the industrial base of the United States and for preventing or 

ameliorating any serious adverse effects on such subsectors. 

(b) TECHNOLOGY TRANSFER.—(1) No official of the United 

States may enter into a memorandum of understanding or other 

agreement with a foreign government that would require the transfer of United States defense technology to a foreign country or a 

foreign firm in connection with a contract that is subject to an offset arrangement if the implementation of such memorandum or 

agreement would significantly and adversely affect the defense industrial base of the United States and would result in a substantial 

financial loss to a United States firm. 

(2) Paragraph (1) shall not apply in the case of a memorandum 

of understanding or agreement described in paragraph (1) if the 

Secretary of Defense, in consultation with the Secretary of Commerce and the Secretary of State, determines that a transfer of 

United States defense technology pursuant to such understanding 

or agreement will result in strengthening the national security of 

the United States and so certifies to Congress. 

(3) If a United States firm is required under the terms of a 

memorandum of understanding, or other agreement entered into by 

the United States with a foreign country, to transfer defense technology to a foreign country, the United States firm may protest the 

determination to the Secretary of Defense on the grounds that the 

transfer of such technology would adversely affect the defense industrial base of the United States and would result in substantial 

financial loss to the protesting firm. The Secretary of Defense, in 

consultation with the Secretary of Commerce and the Secretary of 

State, shall make the final determination of the validity of the protesting firm’s claim. 

(c) NOTIFICATION REGARDING OFFSETS.—If at any time a 

United States firm enters into a contract for the sale of a weapon 

system or defense-related item to a foreign country or foreign firm 

and such contract is subject to an offset arrangement exceeding 

$50,000,000 in value, such firm shall notify the Secretary of Defense of the proposed sale. Notification shall be made under this 

subsection in accordance with regulations prescribed by the Secretary of Defense in consultation with the Secretary of Commerce. 

(d) DEFINITIONS.—In this section: 

(1) The term ‘‘United States firm’’ means a business entity 

that performs substantially all of its manufacturing, production, and research and development activities in the United 

States. 

(2) The term ‘‘foreign firm’’ means a business entity other 

than a United States firm. 

(Added Pub. L. 100–456, div. A, title VIII, Sec. 825(b), Sept. 29, 1988, 102 Stat. 2020, Sec. 2505; 

renumbered Sec. 2532, Pub. L. 102–484, div. D, title XLII, Sec. 4202(a), Oct. 23, 1992, 106 Stat. 

2659.) 

§ 2533. Determinations of public interest under chapter 83 

of title 41 

(a) In determining under section 8302 of title 41 whether application of such Act is inconsistent with the public interest, the Secretary of Defense shall consider the following: 
§ 2533a CH. 148—DEFENSE INDUSTRIAL BASE 1422 

(1) The bids or proposals of small business firms in the 

United States which have offered to furnish American goods. 

(2) The bids or proposals of all other firms in the United 

States which have offered to furnish American goods. 

(3) The United States balance of payments. 

(4) The cost of shipping goods which are other than American goods. 

(5) Any duty, tariff, or surcharge which may enter into the 

cost of using goods which are other than American goods. 

(6) A need to ensure that the Department of Defense has 

access to advanced, state-of-the-art commercial technology. 

(7) The need to protect the national technology and industrial base, to preserve and enhance the national technology employment base, and to provide for a defense mobilization base. 

(8) A need to ensure that application of different rules of 

origin for United States end items and foreign end items does 

not result in an award to a firm other than a firm providing 

a product produced in the United States. 

(9) Any need— 

(A) to maintain the same source of supply for spare 

and replacement parts for an end item that qualifies as an 

American good; or 

(B) to maintain the same source of supply for spare 

and replacement parts in order not to impair integration 

of the military and commercial industrial base. 

(10) The national security interests of the United States. 

(b) In this section, the term ‘‘goods which are other than American goods’’ means— 

(1) an end product that is not mined, produced, or manufactured in the United States; or 

(2) an end product that is manufactured in the United 

States but which includes components mined, produced, or 

manufactured outside the United States the aggregate cost of 

which exceeds the aggregate cost of the components of such 

end product that are mined, produced, or manufactured in the 

United States. 

(Added Pub. L. 100–370, Sec. 3(a)(1), July 19, 1988, 102 Stat. 855, Sec. 2501; renumbered Sec. 

2506, Pub. L. 100–456, div. A, title VIII, Sec. 821(b)(1)(A), Sept. 29, 1988, 102 Stat. 2014; renumbered Sec. 2533, Pub. L. 102–484, div. D, title XLII, Sec. 4202(a), Oct. 23, 1992, 106 Stat. 

2659; amended Pub. L. 103–337, div. A, title VIII, Sec. 812(a), (b)(1), Oct. 5, 1994, 108 Stat. 

2815, 2816; Pub. L. 104–106, div. D, title XLIII, Sec. 4321(b)(20), Feb. 10, 1996, 110 Stat. 673; 

Pub. L. 105–85, div. A, title X, Sec. 1073(a)(54), Nov. 18, 1997, 111 Stat. 1903; Pub. L. 111– 

350, Sec. 5(b)(37), Jan. 4, 2011, 124 Stat. 3845.) 

§ 2533a. Requirement to buy certain articles from American 

sources; exceptions 

(a) REQUIREMENT.—Except as provided in subsections (c) 

through (h), funds appropriated or otherwise available to the Department of Defense may not be used for the procurement of an 

item described in subsection (b) if the item is not grown, reprocessed, reused, or produced in the United States. 

(b) COVERED ITEMS.—An item referred to in subsection (a) is 

any of the following: 

(1) An article or item of— 

(A) food; 
1423 § 2533a CH. 148—DEFENSE INDUSTRIAL BASE 

(B) clothing and the materials and components thereof, other than sensors, electronics, or other items added to, 

and not normally associated with, clothing (and the materials and components thereof); 

(C) tents, tarpaulins, or covers; 

(D) cotton and other natural fiber products, woven silk 

or woven silk blends, spun silk yarn for cartridge cloth, 

synthetic fabric or coated synthetic fabric (including all 

textile fibers and yarns that are for use in such fabrics), 

canvas products, or wool (whether in the form of fiber or 

yarn or contained in fabrics, materials, or manufactured 

articles); or 

(E) any item of individual equipment manufactured 

from or containing such fibers, yarns, fabrics, or materials. 

(2) Hand or measuring tools. 

(c) AVAILABILITY EXCEPTION.—Subsection (a) does not apply to 

the extent that the Secretary of Defense or the Secretary of the 

military department concerned determines that satisfactory quality 

and sufficient quantity of any such article or item described in subsection (b) grown, reprocessed, reused, or produced in the United 

States cannot be procured as and when needed at United States 

market prices. 

(d) EXCEPTION FOR CERTAIN PROCUREMENTS.—Subsection (a) 

does not apply to the following: 

(1) Procurements outside the United States in support of 

combat operations or procurements of any item listed in subsection (b)(1)(A) or (b)(2) in support of contingency operations. 

(2) Procurements by vessels in foreign waters. 

(3) Emergency procurements or procurements of perishable 

foods by, or for, an establishment located outside the United 

States for the personnel attached to such establishment. 

(4) Procurements of any item listed in subsection (b)(1)(A) 

or (b)(2) for which the use of procedures other than competitive 

procedures has been approved on the basis of section 2304(c)(2) 

of this title, relating to unusual and compelling urgency of 

need. 

(e) EXCEPTION FOR CHEMICAL WARFARE PROTECTIVE CLOTHING.—Subsection (a) does not preclude the procurement of chemical 

warfare protective clothing produced outside the United States if— 

(1) such procurement is necessary— 

(A) to comply with agreements with foreign governments requiring the United States to purchase supplies 

from foreign sources for the purposes of offsetting sales 

made by the United States Government or United States 

firms under approved programs serving defense requirements; or 

(B) in furtherance of agreements with foreign governments in which both such governments agree to remove 

barriers to purchases of supplies produced in the other 

country or services performed by sources of the other country; and 

(2) any such agreement with a foreign government complies, where applicable, with the requirements of section 36 of 
§ 2533b CH. 148—DEFENSE INDUSTRIAL BASE 1424 

the Arms Export Control Act (22 U.S.C. 2776) and with section 

2457 of this title. 

(f) EXCEPTIONS FOR CERTAIN OTHER COMMODITIES AND

ITEMS.—Subsection (a) does not preclude the procurement of the 

following: 

(1) Foods manufactured or processed in the United States. 

(2) Waste and byproducts of cotton and wool fiber for use 

in the production of propellants and explosives. 

(g) EXCEPTION FOR COMMISSARIES, EXCHANGES, AND OTHER

NONAPPROPRIATED FUND INSTRUMENTALITIES.—Subsection (a) does 

not apply to items purchased for resale purposes in commissaries, 

exchanges, or nonappropriated fund instrumentalities operated by 

the Department of Defense. 

(h) EXCEPTION FOR SMALL PURCHASES.—Subsection (a) does 

not apply to purchases for amounts not greater than the simplified 

acquisition threshold referred to in section 2304(g) of this title. 

(i) APPLICABILITY TO CONTRACTS AND SUBCONTRACTS FOR PROCUREMENT OF COMMERCIAL ITEMS.—This section is applicable to 

contracts and subcontracts for the procurement of commercial 

items notwithstanding section 1906 of title 41. 

(j) GEOGRAPHIC COVERAGE.—In this section, the term ‘‘United 

States’’ includes the possessions of the United States. 

(k) NOTIFICATION REQUIRED WITHIN 7 DAYS AFTER CONTRACT

AWARD IF CERTAIN EXCEPTIONS APPLIED.—In the case of any contract for the procurement of an item described in subparagraph (B), 

(C), (D), or (E) of subsection (b)(1), if the Secretary of Defense or 

of the military department concerned applies an exception set forth 

in subsection (c) or (e) with respect to that contract, the Secretary 

shall, not later than 7 days after the award of the contract, post 

a notification that the exception has been applied on the Internet 

site maintained by the General Services Administration known as 

FedBizOps.gov (or any successor site). 

(Added Pub. L. 107–107, div. A, title VIII, Sec. 832(a)(1), Dec. 28, 2001, 115 Stat. 1189; amended 

Pub. L. 108–136, div. A, title VIII, Secs. 826, 827, Nov. 24, 2003, 117 Stat. 1548; Pub. L. 109– 

163, div. A, title VIII, Secs. 831, 833, Jan. 6, 2006, 119 Stat. 3388; Pub. L. 109–364, div. A, 

title VIII, Sec. 842(a)(3), Oct. 17, 2006, 120 Stat. 2337; Pub. L. 111–350, Sec. 5(b)(38), Jan. 4, 

2011, 124 Stat. 3845; Pub. L. 111–383, div. A, title VIII, Sec. 847, title X, Sec. 1075(b)(38), Jan. 

7, 2011, 124 Stat. 4286, 4371.) 

§ 2533b. Requirement to buy strategic materials critical to 

national security from American sources; exceptions 

(a) REQUIREMENT.—Except as provided in subsections (b) 

through (m), the acquisition by the Department of Defense of the 

following items is prohibited: 

(1) The following types of end items, or components thereof, containing a specialty metal not melted or produced in the 

United States: aircraft, missile and space systems, ships, tank 

and automotive items, weapon systems, or ammunition. 

(2) A specialty metal that is not melted or produced in the 

United States and that is to be purchased directly by the Department of Defense or a prime contractor of the Department. 

(b) AVAILABILITY EXCEPTION.—(1) Subsection (a) does not apply 

to the extent that the Secretary of Defense or the Secretary of the 

military department concerned determines that compliant specialty 
1425 § 2533b CH. 148—DEFENSE INDUSTRIAL BASE 

metal of satisfactory quality and sufficient quantity, and in the required form, cannot be procured as and when needed. For purposes 

of the preceding sentence, the term ‘‘compliant specialty metal’’ 

means specialty metal melted or produced in the United States. 

(2) This subsection applies to prime contracts and subcontracts 

at any tier under such contracts. 

(c) EXCEPTION FOR CERTAIN ACQUISITIONS.—Subsection (a) 

does not apply to the following: 

(1) Acquisitions outside the United States in support of 

combat operations or in support of contingency operations. 

(2) Acquisitions for which the use of procedures other than 

competitive procedures has been approved on the basis of section 2304(c)(2) of this title, relating to unusual and compelling 

urgency of need. 

(d) EXCEPTION RELATING TO AGREEMENTS WITH FOREIGN GOVERNMENTS.—Subsection (a)(1) does not preclude the acquisition of 

a specialty metal if— 

(1) the acquisition is necessary— 

(A) to comply with agreements with foreign governments requiring the United States to purchase supplies 

from foreign sources for the purposes of offsetting sales 

made by the United States Government or United States 

firms under approved programs serving defense requirements; or 

(B) in furtherance of agreements with foreign governments in which both such governments agree to remove 

barriers to purchases of supplies produced in the other 

country or services performed by sources of the other country; and 

(2) any such agreement with a foreign government complies, where applicable, with the requirements of section 36 of 

the Arms Export Control Act (22 U.S.C. 2776) and with section 

2457 of this title. 

(e) EXCEPTION FOR COMMISSARIES, EXCHANGES, AND OTHER

NONAPPROPRIATED FUND INSTRUMENTALITIES.—Subsection (a) does 

not apply to items purchased for resale purposes in commissaries, 

exchanges, and nonappropriated fund instrumentalities operated 

by the Department of Defense. 

(f) EXCEPTION FOR SMALL PURCHASES.—Subsection (a) does not 

apply to acquisitions in amounts not greater than the simplified acquisition threshold referred to in section 2304(g) of this title. 

(g) EXCEPTION FOR PURCHASES OF ELECTRONIC COMPONENTS.— 

Subsection (a) does not apply to acquisitions of electronic components, unless the Secretary of Defense, upon the recommendation 

of the Strategic Materials Protection Board pursuant to section 187 

of this title, determines that the domestic availability of a particular electronic component is critical to national security. 

(h) APPLICABILITY TO ACQUISITIONS OF COMMERCIAL ITEMS.— 

(1) Except as provided in paragraphs (2) and (3), this section applies to acquisitions of commercial items, notwithstanding sections 
§ 2533b CH. 148—DEFENSE INDUSTRIAL BASE 1426 

2 In subsection (h)(1), ‘‘sections 34 and 35 of the Office of Federal Procurement Policy Act (41 

U.S.C. 430 and 431)’’ should be ‘‘sections 1906 and 1907 of title 41’’. 3 In subsection (h)(2), ‘‘section 35(c) of the Office of Federal Procurement Policy Act (41 U.S.C. 

431(c))’’ should be ‘‘section 104 of title 41’’. 

34 and 35 of the Office of Federal Procurement Policy Act (41 

U.S.C. 430 and 431) 2. (2) This section does not apply to contracts or subcontracts for 

the acquisition of commercially available off-the-shelf items, as defined in section 35(c) of the Office of Federal Procurement Policy 

Act (41 U.S.C. 431(c)) 3, other than— 

(A) contracts or subcontracts for the acquisition of specialty metals, including mill products, such as bar, billet, slab, 

wire, plate and sheet, that have not been incorporated into end 

items, subsystems, assemblies, or components; 

(B) contracts or subcontracts for the acquisition of forgings 

or castings of specialty metals, unless such forgings or castings 

are incorporated into commercially available off-the-shelf end 

items, subsystems, or assemblies; 

(C) contracts or subcontracts for commercially available 

high performance magnets unless such high performance 

magnets are incorporated into commercially available off-theshelf-end items or subsystems; and 

(D) contracts or subcontracts for commercially available 

off-the-shelf fasteners, unless such fasteners are— 

(i) incorporated into commercially available off-theshelf end items, subsystems, assemblies, or components; or 

(ii) purchased as provided in paragraph (3). 

(3) This section does not apply to fasteners that are commercial 

items that are purchased under a contract or subcontract with a 

manufacturer of such fasteners, if the manufacturer has certified 

that it will purchase, during the relevant calendar year, an amount 

of domestically melted specialty metal, in the required form, for use 

in the production of such fasteners for sale to the Department of 

Defense and other customers, that is not less than 50 percent of 

the total amount of the specialty metal that it will purchase to 

carry out the production of such fasteners. 

(i) EXCEPTIONS FOR PURCHASES OF SPECIALTY METALS BELOW

MINIMUM THRESHOLD.—(1) Notwithstanding subsection (a), the 

Secretary of Defense or the Secretary of a military department may 

accept delivery of an item containing specialty metals that were not 

melted in the United States if the total amount of noncompliant 

specialty metals in the item does not exceed 2 percent of the total 

weight of specialty metals in the item. 

(2) This subsection does not apply to high performance 

magnets. 

(j) STREAMLINED COMPLIANCE FOR COMMERCIAL DERIVATIVE

MILITARY ARTICLES.—(1) Subsection (a) shall not apply to an item 

acquired under a prime contract if the Secretary of Defense or the 

Secretary of a military department determines that— 

(A) the item is a commercial derivative military article; 

and 

(B) the contractor certifies that the contractor and its subcontractors have entered into a contractual agreement, or 

agreements, to purchase an amount of domestically melted spe-
1427 § 2533b CH. 148—DEFENSE INDUSTRIAL BASE 

cialty metal in the required form, for use during the period of 

contract performance in the production of the commercial derivative military article and the related commercial article, 

that is not less than the greater of— 

(i) an amount equivalent to 120 percent of the amount 

of specialty metal that is required to carry out the production of the commercial derivative military article (including the work performed under each subcontract); or 

(ii) an amount equivalent to 50 percent of the amount 

of specialty metal that is purchased by the contractor and 

its subcontractors for use during such period in the production of the commercial derivative military article and 

the related commercial article. 

(2) For the purposes of this subsection, the amount of specialty 

metal that is required to carry out the production of the commercial derivative military article includes specialty metal contained in 

any item, including commercially available off-the-shelf items, incorporated into such commercial derivative military article. 

(k) NATIONAL SECURITY WAIVER.—(1) Notwithstanding subsection (a), the Secretary of Defense may accept the delivery of an 

end item containing noncompliant materials if the Secretary determines in writing that acceptance of such end item is necessary to 

the national security interests of the United States. 

(2) A written determination under paragraph (1)— 

(A) may not be delegated below the level of the Deputy 

Secretary of Defense or the Under Secretary of Defense for Acquisition, Technology, and Logistics; 

(B) shall specify the quantity of end items to which the 

waiver applies and the time period over which the waiver applies; and 

(C) shall be provided to the congressional defense committees prior to making such a determination (except that in the 

case of an urgent national security requirement, such certification may be provided to the defense committees up to 7 days 

after it is made). 

(3)(A) In any case in which the Secretary makes a determination under paragraph (1), the Secretary shall determine whether or 

not the noncompliance was knowing and willful. 

(B) If the Secretary determines that the noncompliance was 

not knowing or willful, the Secretary shall ensure that the contractor or subcontractor responsible for the noncompliance develops 

and implements an effective plan to ensure future compliance. 

(C) If the Secretary determines that the noncompliance was 

knowing or willful, the Secretary shall— 

(i) require the development and implementation of a plan 

to ensure future compliance; and 

(ii) consider suspending or debarring the contractor or subcontractor until such time as the contractor or subcontractor 

has effectively addressed the issues that lead to such noncompliance. 

(l) SPECIALTY METAL DEFINED.—In this section, the term ‘‘specialty metal’’ means any of the following: 

(1) Steel— 
§ 2533b CH. 148—DEFENSE INDUSTRIAL BASE 1428 

4 In subsection (m)(2), ‘‘section 4 of the Office of Federal Procurement Policy Act (41 U.S.C. 

403)’’ should be ‘‘section 105 of title 41’’. 5 In subsection (m)(3), ‘‘section 4 of the Office of Federal Procurement Policy Act (41 U.S.C. 

403)’’ should be ‘‘section 131 of title 41’’. 6 In subsection (m)(5), ‘‘section 35(c) of the Office of Federal Procurement Policy Act (41 U.S.C. 

431(c))’’ should be ‘‘section 104 of title 41’’. 

(A) with a maximum alloy content exceeding one or 

more of the following limits: manganese, 1.65 percent; silicon, 0.60 percent; or copper, 0.60 percent; or 

(B) containing more than 0.25 percent of any of the 

following elements: aluminum, chromium, cobalt, columbium, molybdenum, nickel, titanium, tungsten, or vanadium. 

(2) Metal alloys consisting of nickel, iron-nickel, and cobalt 

base alloys containing a total of other alloying metals (except 

iron) in excess of 10 percent. 

(3) Titanium and titanium alloys. 

(4) Zirconium and zirconium base alloys. 

(m) ADDITIONAL DEFINITIONS.—In this section: 

(1) The term ‘‘United States’’ includes possessions of the 

United States. 

(2) The term ‘‘component’’ has the meaning provided in 

section 4 of the Office of Federal Procurement Policy Act (41 

U.S.C. 403) 4. 

(3) The term ‘‘acquisition’’ has the meaning provided in 

section 4 of the Office of Federal Procurement Policy Act (41 

U.S.C. 403) 5. 

(4) The term ‘‘required form’’ shall not apply to end items 

or to their components at any tier. The term ‘‘required form’’ 

means in the form of mill product, such as bar, billet, wire, 

slab, plate or sheet, and in the grade appropriate for the production of— 

(A) a finished end item delivered to the Department of 

Defense; or 

(B) a finished component assembled into an end item 

delivered to the Department of Defense. 

(5) The term ‘‘commercially available off-the-shelf’’, has the 

meaning provided in section 35(c) of the Office of Federal Procurement Policy Act (41 U.S.C. 431(c)) 6. 

(6) The term ‘‘assemblies’’ means items forming a portion 

of a system or subsystem that can be provisioned and replaced 

as an entity and which incorporates multiple, replaceable 

parts. 

(7) The term ‘‘commercial derivative military article’’ 

means an item procured by the Department of Defense that is 

or will be produced using the same production facilities, a common supply chain, and the same or similar production processes that are used for the production of articles predominantly 

used by the general public or by nongovernmental entities for 

purposes other than governmental purposes. 

(8) The term ‘‘subsystem’’ means a functional grouping of 

items that combine to perform a major function within an end 

item, such as electrical power, attitude control, and propulsion. 
1429 § 2534 CH. 148—DEFENSE INDUSTRIAL BASE 

(9) The term ‘‘end item’’ means the final production product when assembled or completed, and ready for issue, delivery, or deployment. 

(10) The term ‘‘subcontract’’ includes a subcontract at any 

tier. 

(Added Pub. L. 109–364, div. A, title VIII, Sec. 842(a)(1), Oct. 17, 2006, 120 Stat. 2335; amended 

Pub. L. 110–181, div. A, title VIII, Sec. 804(a)–(f), Jan. 28, 2008, 122 Stat. 208–211; Pub. L. 

111–350, Sec. 5(b)(39), Jan. 4, 2011, 124 Stat. 3845; Pub. L. 111–383, div. A, title X, Sec. 

1075(f)(2), Jan. 7, 2011, 124 Stat. 4376.) 

§ 2534. Miscellaneous limitations on the procurement of 

goods other than United States goods 

(a) LIMITATION ON CERTAIN PROCUREMENTS.—The Secretary of 

Defense may procure any of the following items only if the manufacturer of the item satisfies the requirements of subsection (b): 

(1) BUSES.—Multipassenger motor vehicles (buses). 

(2) CHEMICAL WEAPONS ANTIDOTE.—Chemical weapons 

antidote contained in automatic injectors (and components for 

such injectors). 

(3) COMPONENTS FOR NAVAL VESSELS.—(A) The following 

components: 

(i) Air circuit breakers. 

(ii) Welded shipboard anchor and mooring chain with 

a diameter of four inches or less. 

(iii) Vessel propellers with a diameter of six feet or 

more. 

(B) The following components of vessels, to the extent they 

are unique to marine applications: gyrocompasses, electronic 

navigation chart systems, steering controls, pumps, propulsion 

and machinery control systems, and totally enclosed lifeboats. 

(4) VALVES AND MACHINE TOOLS.—Items in the following 

categories: 

(A) Powered and non-powered valves in Federal Supply Classes 4810 and 4820 used in piping for naval surface 

ships and submarines. 

(B) Machine tools in the Federal Supply Classes for 

metal-working machinery numbered 3405, 3408, 3410 

through 3419, 3426, 3433, 3438, 3441 through 3443, 3445, 

3446, 3448, 3449, 3460, and 3461. 

(5) BALL BEARINGS AND ROLLER BEARINGS.—Ball bearings 

and roller bearings, in accordance with subpart 225.71 of part 

225 of the Defense Federal Acquisition Regulation Supplement, 

as in effect on October 23, 1992 , except ball bearings and roller bearings being procured for use in an end product manufactured by a manufacturer that does not satisfy the requirements 

of subsection (b) or in a component part manufactured by such 

a manufacturer. 

(b) MANUFACTURER IN THE NATIONAL TECHNOLOGY AND INDUSTRIAL BASE.— 

(1) GENERAL REQUIREMENT.—A manufacturer meets the 

requirements of this subsection if the manufacturer is part of 

the national technology and industrial base. 

(2) MANUFACTURERS OF CHEMICAL WEAPONS ANTIDOTE.—In 

the case of a procurement of chemical weapons antidote re-
§ 2534 CH. 148—DEFENSE INDUSTRIAL BASE 1430 

ferred to in subsection (a)(2), a manufacturer meets the requirements of this subsection only if the manufacturer— 

(A) meets the requirement set forth in paragraph (1); 

(B) is an existing producer under the industrial preparedness program at the time the contract is awarded; 

(C) has received all required regulatory approvals; and 

(D) when the contract for the procurement is awarded, 

has in existence in the national technology and industrial 

base the plant, equipment, and personnel necessary to perform the contract. 

(3) MANUFACTURER OF VESSEL PROPELLERS.—In the case of 

a procurement of vessel propellers referred to in subsection 

(a)(3)(A)(iii), the manufacturer of the propellers meets the requirements of this subsection only if— 

(A) the manufacturer meets the requirements set forth 

in paragraph (1); and 

(B) all castings incorporated into such propellers are 

poured and finished in the United States. 

(c) APPLICABILITY TO CERTAIN ITEMS.— (1) COMPONENTS FOR NAVAL VESSELS.—Subsection (a) does 

not apply to a procurement of spare or repair parts needed to 

support components for naval vessels produced or manufactured outside the United States. 

(2) VALVES AND MACHINE TOOLS.—(A) Contracts to which 

subsection (a) applies include the following contracts for the 

procurement of items described in paragraph (4) of such subsection: 

(i) A contract for procurement of such an item for use 

in property under the control of the Department of Defense, including any Government-owned, contractor-operated facility. 

(ii) A contract that is entered into by a contractor on 

behalf of the Department of Defense for the purpose of providing such an item to another contractor as Governmentfurnished equipment. 

(B) In any case in which a contract for items described in 

subsection (a)(4) includes the procurement of more than one 

Federal Supply Class of machine tools or machine tools and accessories, each supply class shall be evaluated separately for 

purposes of determining whether the limitation in subsection 

(a) applies. 

(C) Subsection (a)(4) and this paragraph shall cease to be 

effective on October 1, 1996. 

(3) BALL BEARINGS AND ROLLER BEARINGS.—Subsection 

(a)(5) and this paragraph shall cease to be effective on October 

1, 2005. 

(4) VESSEL PROPELLERS.—Subsection (a)(3)(A)(iii) and this 

paragraph shall cease to be effective on February 10, 1998. 

(d) WAIVER AUTHORITY.—The Secretary of Defense may waive 

the limitation in subsection (a) with respect to the procurement of 

an item listed in that subsection if the Secretary determines that 

any of the following apply: 

(1) Application of the limitation would cause unreasonable 

costs or delays to be incurred. 
1431 § 2534 CH. 148—DEFENSE INDUSTRIAL BASE 

(2) United States producers of the item would not be jeopardized by competition from a foreign country, and that country does not discriminate against defense items produced in the 

United States to a greater degree than the United States discriminates against defense items produced in that country. 

(3) Application of the limitation would impede cooperative 

programs entered into between the Department of Defense and 

a foreign country, or would impede the reciprocal procurement 

of defense items under a memorandum of understanding providing for reciprocal procurement of defense items that is entered into under section 2531 of this title, and that country 

does not discriminate against defense items produced in the 

United States to a greater degree than the United States discriminates against defense items produced in that country. 

(4) Satisfactory quality items manufactured by an entity 

that is part of the national technology and industrial base (as 

defined in section 2500(1) of this title) are not available. 

(5) Application of the limitation would result in the existence of only one source for the item that is an entity that is 

part of the national technology and industrial base (as defined 

in section 2500(1) of this title). 

(6) The procurement is for an amount less than the simplified acquisition threshold and simplified purchase procedures are being used. 

(7) Application of the limitation is not in the national security interests of the United States. 

(8) Application of the limitation would adversely affect a 

United States company. 

(e) SONOBUOYS.— 

(1) LIMITATION.—The Secretary of Defense may not procure a sonobuoy manufactured in a foreign country if United 

States firms that manufacture sonobuoys are not permitted to 

compete on an equal basis with foreign manufacturing firms 

for the sale of sonobuoys in that foreign country. 

(2) WAIVER AUTHORITY.—The Secretary may waive the limitation in paragraph (1) with respect to a particular procurement of sonobuoys if the Secretary determines that such procurement is in the national security interests of the United 

States. 

(3) DEFINITION.—In this subsection, the term ‘‘United 

States firm’’ has the meaning given such term in section 

2532(d)(1) of this title. 

(f) PRINCIPLE OF CONSTRUCTION WITH FUTURE LAWS.—A provision of law may not be construed as modifying or superseding the 

provisions of this section, or as requiring funds to be limited, or 

made available, by the Secretary of Defense to a particular domestic source by contract, unless that provision of law— 

(1) specifically refers to this section; 

(2) specifically states that such provision of law modifies or 

supersedes the provisions of this section; and 

(3) specifically identifies the particular domestic source involved and states that the contract to be awarded pursuant to 

such provision of law is being awarded in contravention of this 

section. 
§ 2534 CH. 148—DEFENSE INDUSTRIAL BASE 1432 

(g) INAPPLICABILITY TO CONTRACTS UNDER SIMPLIFIED ACQUISI- TION THRESHOLD.—(1) This section does not apply to a contract or 

subcontract for an amount that does not exceed the simplified acquisition threshold. 

(2) Paragraph (1) does not apply to contracts for items described in subsection (a)(5) (relating to ball bearings and roller 

bearings), notwithstanding section 1905 of title 41. 

(h) IMPLEMENTATION OF NAVAL VESSEL COMPONENT LIMITA- TION.—In implementing subsection (a)(3)(B), the Secretary of Defense— 

(1) may not use contract clauses or certifications; and 

(2) shall use management and oversight techniques that 

achieve the objective of the subsection without imposing a significant management burden on the Government or the contractor involved. 

(i) IMPLEMENTATION OF CERTAIN WAIVER AUTHORITY.—(1) The 

Secretary of Defense may exercise the waiver authority described 

in paragraph (2) only if the waiver is made for a particular item 

listed in subsection (a) and for a particular foreign country. 

(2) This subsection applies to the waiver authority provided by 

subsection (d) on the basis of the applicability of paragraph (2) or 

(3) of that subsection. 

(3) The waiver authority described in paragraph (2) may not be 

delegated below the Under Secretary of Defense for Acquisition, 

Technology, and Logistics. 

(4) At least 15 days before the effective date of any waiver 

made under the waiver authority described in paragraph (2), the 

Secretary shall publish in the Federal Register and submit to the 

congressional defense committees a notice of the determination to 

exercise the waiver authority. 

(5) Any waiver made by the Secretary under the waiver authority described in paragraph (2) shall be in effect for a period not 

greater than one year, as determined by the Secretary. 

(j) INAPPLICABILITY TO CERTAIN CONTRACTS TO PURCHASE BALL

BEARINGS OR ROLLER BEARINGS.—(1) This section does not apply 

with respect to a contract or subcontract to purchase items described in subsection (a)(5) (relating to ball bearings and roller 

bearings) for which— 

(A) the amount of the purchase does not exceed $2,500; 

(B) the precision level of the ball or roller bearings to be 

procured under the contract or subcontract is rated lower than 

the rating known as Annual Bearing Engineering Committee 

(ABEC) 5 or Roller Bearing Engineering Committee (RBEC) 5, 

or an equivalent of such rating; 

(C) at least two manufacturers in the national technology 

and industrial base that are capable of producing the ball or 

roller bearings have not responded to a request for quotation 

issued by the contracting activity for that contract or subcontract; and 

(D) no bearing to be procured under the contract or subcontract has a basic outside diameter (exclusive of flange diameters) in excess of 30 millimeters. 

(2) Paragraph (1) does not apply to a purchase if such purchase 

would result in the total amount of purchases of ball bearings and 
1433 § 2535 CH. 148—DEFENSE INDUSTRIAL BASE 

roller bearings to satisfy requirements under Department of Defense contracts, using the authority provided in such paragraph, to 

exceed $200,000 during the fiscal year of such purchase. 

(Added Pub. L. 97–295, Sec. 1(29)(A), Oct. 12, 1982, 96 Stat. 1294, Sec. 2400; amended Pub. 

L. 100–180, div. A, title I, Sec. 124(a), (b)(1), title VIII, Sec. 824(a), Dec. 4, 1987, 101 Stat. 1042, 

1043, 1134; renumbered Sec. 2502 and amended Pub. L. 100–370, Sec. 3(b)(1), July 19, 1988, 

102 Stat. 855; renumbered Sec. 2507 and amended Pub. L. 100–456, div. A, title VIII, Secs. 

821(b)(1)(A), 822, Sept. 29, 1988, 102 Stat. 2014, 2017; Pub. L. 101–510, div. A, title VIII, Sec. 

835(a), title XIV, Sec. 1421, Nov. 5, 1990, 104 Stat. 1614, 1682; Pub. L. 102–190, div. A, title 

VIII, Secs. 834, 835, Dec. 5, 1991, 105 Stat. 1447, 1448; renumbered Sec. 2534 and amended 

Pub. L. 102–484, div. A, title VIII, Secs. 831, 833(a), title X, Sec. 1052(33), div. D, title XLII, 

Secs. 4202(a), 4271(b)(4), Oct. 23, 1992, 106 Stat. 2460, 2461, 2501, 2659, 2696; Pub. L. 103– 

160, div. A, title IX, Sec. 904(d)(1), Nov. 30, 1993, 107 Stat. 1728; Pub. L. 103–337, div. A, title 

VIII, Sec. 814, Oct. 5, 1994, 108 Stat. 2817; Pub. L. 103–355, title IV, Sec. 4102(i), Oct. 13, 1994, 

108 Stat. 3341; Pub. L. 104–106, div. A, title VIII, Sec. 806(a)(1)–(4), (b)–(d), title XV, Sec. 

1503(a)(30), Feb. 10, 1996, 110 Stat. 390, 391, 512; Pub. L. 104–201, div. A, title VIII, Sec. 810, 

title X, Sec. 1074(a)(14), Sept. 23, 1996, 110 Stat. 2608, 2659; Pub. L. 105–85, div. A, title III, 

Sec. 371(d)(1), title VIII, Sec. 811(a), title X, Sec. 1073(a)(55), Nov. 18, 1997, 111 Stat. 1706, 

1839, 1903; Pub. L. 106–398, Sec. 1 [[div. A], title VIII, Sec. 805], Oct. 30, 2000, 114 Stat. 1654, 

1654A–207; Pub. L. 107–107, div. A, title VIII, Sec. 835(a), title X, Sec. 1048(b)(2), Dec. 28, 2001, 

115 Stat. 1191, 1225; Pub. L. 108–136, div. A, title VIII, Sec. 828, Nov. 24, 2003, 117 Stat. 1548; 

Pub. L. 111–350, Sec. 5(b)(40), Jan. 4, 2011, 124 Stat. 3846.) 

§ 2535. Defense Industrial Reserve 

(a) DECLARATION OF PURPOSE AND POLICY.—It is the intent of 

Congress— 

(1) to provide a comprehensive and continuous program for 

the future safety and for the defense of the United States by 

providing adequate measures whereby an essential nucleus of 

Government-owned industrial plants and an industrial reserve 

of machine tools and other industrial manufacturing equipment may be assured for immediate use to supply the needs 

of the armed forces in time of national emergency or in anticipation thereof; 

(2) that such Government-owned plants and such reserve 

shall not exceed in number or kind the minimum requirements 

for immediate use in time of national emergency, and that any 

such items which shall become excess to such requirements 

shall be disposed of as expeditiously as possible; 

(3) that to the maximum extent practicable, reliance will 

be placed upon private industry for support of defense production; and 

(4) that machine tools and other industrial manufacturing 

equipment may be held in plant equipment packages or in a 

general reserve to maintain a high state of readiness for production of critical items of defense materiel, to provide production capacity not available in private industry for defense materiel, or to assist private industry in time of national disaster. 

(b) POWERS AND DUTIES OF THE SECRETARY OF DEFENSE.—(1) 

To execute the policy set forth in subsection (a), the Secretary of 

Defense shall— 

(A) determine which industrial plants and installations 

(including machine tools and other industrial manufacturing 

equipment) should become a part of the Defense Industrial Reserve; 

(B) designate what excess industrial property shall be disposed of; 

(C) establish general policies and provide for the transportation, handling, care, storage, protection, maintenance, repair, 
§ 2535 CH. 148—DEFENSE INDUSTRIAL BASE 1434 

rebuilding, utilization, recording, leasing and security of such 

property; 

(D) direct the transfer without reimbursement of such 

property to other Government agencies with the consent of 

such agencies; 

(E) direct the leasing of any of such property to designated 

lessees; 

(F) authorize the disposition in accordance with existing 

law of any of such property when in the opinion of the Secretary such property is no longer needed by the Department of 

Defense; and 

(G) notwithstanding chapter 5 of title 40 and any other 

provision of law, authorize the transfer to a nonprofit educational institution or training school, on a nonreimbursable 

basis, of any such property already in the possession of such 

institution or school whenever the program proposed by such 

institution or school for the use of such property is in the public interest. 

(2)(A) The Secretary of a military department to which equipment or other property is transferred from the Defense Industrial 

Reserve shall reimburse appropriations available for the purposes 

of the Defense Industrial Reserve for the full cost (including direct 

and indirect costs) of— 

(i) storage of such property; 

(ii) repair and maintenance of such property; and 

(iii) overhead allocated to such property. 

(B) The Secretary of Defense shall prescribe regulations establishing general policies and fee schedules for reimbursements 

under subparagraph (A). 

(c) DEFINITIONS.—In this section: 

(1) The term ‘‘Defense Industrial Reserve’’ means— 

(A) a general reserve of industrial manufacturing 

equipment, including machine tools, selected by the Secretary of Defense for retention for national defense or for 

other emergency use; 

(B) those industrial plants and installations held by 

and under the control of the Department of Defense in active or inactive status, including Government-owned/Government-operated plants and installations and Government-owned/contractor-operated plants and installations 

which are retained for use in their entirety, or in part, for 

production of military weapons systems, munitions, components, or supplies; and 

(C) those industrial plants and installations under the 

control of the Secretary which are not required for the immediate need of any department or agency of the Government and which should be sold, leased, or otherwise disposed of. 

(2) The term ‘‘plant equipment package’’ means a complement of active and idle machine tools and other industrial 

manufacturing equipment held by and under the control of the 

Department of Defense and approved by the Secretary for retention to produce particular defense materiel or defense sup-
1435 § 2536 CH. 148—DEFENSE INDUSTRIAL BASE 

porting items at a specific level of output in the event of emergency. 

(Added and amended Pub. L. 102–484, div. D, title XLII, Sec. 4235, Oct. 23, 1992, 106 Stat. 

2690; Pub. L. 103–35, title II, Sec. 201(c)(8), May 31, 1993, 107 Stat. 98; Pub. L. 103–337, div. 

A, title III, Sec. 379(a), Oct. 5, 1994, 108 Stat. 2737; Dec. 28, 2001, Pub. L. 107–107, div. A, 

title X, Sec. 1048(a)(23), 115 Stat. 1224; Pub. L. 107–217, Sec. 3(b)(7), Aug. 21, 2002, 116 Stat. 

1295.) 

§ 2536. Award of certain contracts to entities controlled by 

a foreign government: prohibition 

(a) IN GENERAL.—A Department of Defense contract or Department of Energy contract under a national security program may 

not be awarded to an entity controlled by a foreign government if 

it is necessary for that entity to be given access to information in 

a proscribed category of information in order to perform the contract. 

(b) WAIVER AUTHORITY.—(1) The Secretary concerned may 

waive the application of subsection (a) to a contract award if— 

(A) the Secretary concerned determines that the waiver is 

essential to the national security interests of the United 

States; or 

(B) in the case of a contract awarded for environmental 

restoration, remediation, or waste management at a Department of Defense or Department of Energy facility— 

(i) the Secretary concerned determines that the waiver 

will advance the environmental restoration, remediation, 

or waste management objectives of the department concerned and will not harm the national security interests of 

the United States; and 

(ii) the entity to which the contract is awarded is controlled by a foreign government with which the Secretary 

concerned is authorized to exchange Restricted Data under 

section 144 c. of the Atomic Energy Act of 1954 (42 U.S.C. 

2164(c)). 

(2) The Secretary concerned shall notify Congress of any decision to grant a waiver under paragraph (1)(B) with respect to a 

contract. The contract may be awarded only after the end of the 45- 

day period beginning on the date the notification is received by the 

committees. 

(c) DEFINITIONS.—In this section: 

(1) The term ‘‘entity controlled by a foreign government’’ 

includes— 

(A) any domestic or foreign organization or corporation 

that is effectively owned or controlled by a foreign government; and 

(B) any individual acting on behalf of a foreign government, 

as determined by the Secretary concerned. Such term does not 

include an organization or corporation that is owned, but is not 

controlled, either directly or indirectly, by a foreign government if the ownership of that organization or corporation by 

that foreign government was effective before October 23, 1992. 

(2) The term ‘‘proscribed category of information’’ means a 

category of information that— 

(A) with respect to Department of Defense contracts— 
§ 2537 CH. 148—DEFENSE INDUSTRIAL BASE 1436 

(i) includes special access information; 

(ii) is determined by the Secretary of Defense to 

include information the disclosure of which to an entity controlled by a foreign government is not in the national security interests of the United States; and 

(iii) is defined in regulations prescribed by the 

Secretary of Defense for the purposes of this section; 

and 

(B) with respect to Department of Energy contracts— 

(i) is determined by the Secretary of Energy to include information described in subparagraph (A)(ii); 

and 

(ii) is defined in regulations prescribed by the Secretary of Energy for the purposes of this section. 

(3) The term ‘‘Secretary concerned’’ means— 

(A) the Secretary of Defense, with respect to Department of Defense contracts; and 

(B) the Secretary of Energy, with respect to Department of Energy contracts. 

(Added Pub. L. 102–484, div. A, title VIII, Sec. 836(a)(1), Oct. 23, 1992, 106 Stat. 2462; amended 

Pub. L. 103–35, title II, Sec. 201(d)(4), May 31, 1993, 107 Stat. 99; Pub. L. 103–160, div. A, 

title VIII, Sec. 842(a)–(c)(1), Nov. 30, 1993, 107 Stat. 1719; Pub. L. 104–201, div. A, title VIII, 

Sec. 828, Sept. 23, 1996, 110 Stat. 2611.) 

§ 2537. Improved national defense control of technology diversions overseas 

(a) COLLECTION OF INFORMATION ON FOREIGN-CONTROLLED

CONTRACTORS.—The Secretary of Defense and the Secretary of Energy shall each collect and maintain a data base containing a list 

of, and other pertinent information on, all contractors with the Department of Defense and the Department of Energy, respectively, 

that are controlled by foreign persons. The data base shall contain 

information on such contractors for 1988 and thereafter in all cases 

where they are awarded contracts exceeding $10,000,000 in any 

single year by the Department of Defense or the Department of Energy. 

(b) ANNUAL REPORT TO CONGRESS.—The Secretary of Defense, 

the Secretary of Energy, and the Secretary of Commerce shall submit to the Congress, by March 31 of each year, beginning in 1994, 

a report containing a summary and analysis of the information collected under subsection (a) for the year covered by the report. The 

report shall include an analysis of accumulated foreign ownership 

of United States firms engaged in the development of defense critical technologies. 

(c) TECHNOLOGY RISK ASSESSMENT REQUIREMENT.—(1) If the 

Secretary of Defense is acting as a designee of the President under 

section 721(a) of the Defense Production Act of 1950 (50 U.S.C. 

App. 2170(a)) and if the Secretary determines that a proposed or 

pending merger, acquisition, or takeover may involve a firm engaged in the development of a defense critical technology or is otherwise important to the defense industrial and technology base, 

then the Secretary shall require the appropriate entity or entities 

from the list set forth in paragraph (2) to conduct an assessment 

of the risk of diversion of defense critical technology posed by such 

proposed or pending action. 
1437 § 2539 CH. 148—DEFENSE INDUSTRIAL BASE 

(2) The entities referred to in paragraph (1) are the following: 

(A) The Defense Intelligence Agency. 

(B) The Army Foreign Technology Science Center. 

(C) The Naval Maritime Intelligence Center. 

(D) The Air Force Foreign Aerospace Science and Technology Center. 

(Added Pub. L. 102–484, div. A, title VIII, Sec. 838(a), Oct. 23, 1992, 106 Stat. 2465; amended 

Pub. L. 103–35, title II, Sec. 201(d)(5), (h)(2), May 31, 1993, 107 Stat. 99, 100; Pub. L. 107– 

314, div. A, title X, Sec. 1041(a)(16), Dec. 2, 2002, 116 Stat. 2645.) 

§ 2538. Industrial mobilization: orders; priorities; possession 

of manufacturing plants; violations 

(a) ORDERING AUTHORITY.—In time of war or when war is imminent, the President, through the head of any department, may 

order from any person or organized manufacturing industry necessary products or materials of the type usually produced or capable of being produced by that person or industry. 

(b) COMPLIANCE WITH ORDER REQUIRED.—A person or industry 

with whom an order is placed under subsection (a), or the responsible head thereof, shall comply with that order and give it precedence over all orders not placed under that subsection. 

(c) SEIZURE OF MANUFACTURING PLANTS UPON NONCOMPLI- ANCE.—In time of war or when war is imminent, the President, 

through the head of any department, may take immediate possession of any plant that is equipped to manufacture, or that in the 

opinion of the head of that department is capable of being readily 

transformed into a plant for manufacturing, arms or ammunition, 

parts thereof, or necessary supplies for the armed forces if the person or industry owning or operating the plant, or the responsible 

head thereof, refuses— 

(1) to give precedence to the order as prescribed in subsection (b); 

(2) to manufacture the kind, quantity, or quality of arms 

or ammunition, parts thereof, or necessary supplies, as ordered 

by the head of such department; or 

(3) to furnish them at a reasonable price as determined by 

the head of such department. 

(d) USE OF SEIZED PLANT.—The President, through the head of 

any department, may manufacture products that are needed in 

time of war or when war is imminent, in any plant that is seized 

under subsection (c). 

(e) COMPENSATION REQUIRED.—Each person or industry from 

whom products or materials are ordered under subsection (a) is entitled to fair and just compensation. Each person or industry whose 

plant is seized under subsection (c) is entitled to a fair and just 

rental. 

(f) CRIMINAL PENALTY.—Whoever fails to comply with this section shall be imprisoned for not more than three years and fined 

under title 18. 

(Added Pub. L. 103–160, div. A, title VIII, Sec. 822(a)(1), Nov. 30, 1993, 107 Stat. 1704; amended Pub. L. 103–337, div. A, title VIII, Sec. 811, Oct. 5, 1994, 108 Stat. 2815.) 

§ 2539. Industrial mobilization: plants; lists 

(a) LIST OF PLANTS EQUIPPED TO MANUFACTURE ARMS OR AMMUNITION.—The Secretary of Defense may maintain a list of all pri-
§ 2539a CH. 148—DEFENSE INDUSTRIAL BASE 1438 

vately owned plants in the United States, and the territories, Commonwealths, and possessions of the United States, that are 

equipped to manufacture for the armed forces arms or ammunition, 

or parts thereof, and may obtain complete information of the kinds 

of those products manufactured or capable of being manufactured 

by each of those plants, and of the equipment and capacity of each 

of those plants. 

(b) LIST OF PLANTS CONVERTIBLE INTO AMMUNITION FACTORIES.—The Secretary of Defense may maintain a list of privately 

owned plants in the United States, and the territories, Commonwealths, and possessions of the United States, that are capable of 

being readily transformed into factories for the manufacture of ammunition for the armed forces and that have a capacity sufficient 

to warrant conversion into ammunition plants in time of war or 

when war is imminent, and may obtain complete information as to 

the equipment of each of those plants. 

(c) CONVERSION PLANS.—The Secretary of Defense may prepare 

comprehensive plans for converting each plant listed pursuant to 

subsection (b) into a factory for the manufacture of ammunition or 

parts thereof. 

(Added Pub. L. 103–160, div. A, title VIII, Sec. 822(a)(1), Nov. 30, 1993, 107 Stat. 1705.) 

§ 2539a. Industrial mobilization: Board on Mobilization of 

Industries Essential for Military Preparedness 

The President may appoint a nonpartisan Board on Mobilization of Industries Essential for Military Preparedness, and may 

provide necessary clerical assistance, to organize and coordinate operations under sections 2538 and 2539 of this title. 

(Added Pub. L. 103–160, div. A, title VIII, Sec. 822(a)(1), Nov. 30, 1993, 107 Stat. 1705, Sec. 

2540; renumbered Sec. 2539a, Pub. L. 103–337, div. A, title X, Sec. 1070(a)(13)(A), Oct. 5, 1994, 

108 Stat. 2856.) 

§ 2539b. Availability of samples, drawings, information, 

equipment, materials, and certain services 

(a) AUTHORITY.—The Secretary of Defense and the Secretaries 

of the military departments, under regulations prescribed by the 

Secretary of Defense and when determined by the Secretary of Defense or the Secretary concerned to be in the interest of national 

defense, may each— 

(1) sell, rent, lend, or give samples, drawings, and manufacturing or other information (subject to the rights of third 

parties) to any person or entity; 

(2) sell, rent, or lend government equipment or materials 

to any person or entity— 

(A) for use in independent research and development 

programs, subject to the condition that the equipment or 

material be used exclusively for such research and development; or 

(B) for use in demonstrations to a friendly foreign government; 

(3) make available to any person or entity, at an appropriate fee, the services of any government laboratory, center, 

range, or other testing facility for the testing of materials, 

equipment, models, computer software, and other items; and 
1439 § 2540 CH. 148—DEFENSE INDUSTRIAL BASE 

(4) make available to any person or entity, through leases, 

contracts, or other appropriate arrangements, facilities, services, and equipment of any government laboratory, research 

center, or range, if the facilities, services, and equipment provided will not be in direct competition with the domestic private sector. 

(b) CONFIDENTIALITY OF TEST RESULTS.—The results of tests 

performed with services made available under subsection (a)(3) are 

confidential and may not be disclosed outside the Federal Government without the consent of the persons for whom the tests are 

performed. 

(c) FEES.—Fees made available under subsections (a)(3) and 

(a)(4) shall be established in the regulations prescribed pursuant to 

subsection (a). Such fees may not exceed the amount necessary to 

recoup the direct and indirect costs involved, such as direct costs 

of utilities, contractor support, and salaries of personnel that are 

incurred by the United States to provide for the testing. 

(d) USE OF FEES.—Fees received under subsections (a)(3) and 

(a)(4) may be credited to the appropriations or other funds of the 

activity making such services available. 

(Added Pub. L. 103–160, div. A, title VIII, Sec. 822(b)(1), Nov. 30, 1993, 107 Stat. 1705, Sec. 

2541; renumbered Sec. 2539b, Pub. L. 103–337, div. A, title X, Sec. 1070(a)(13)(A), Oct. 5, 1994, 

108 Stat. 2856; amended Pub. L. 103–355, title III, Sec. 3022, Oct. 13, 1994, 108 Stat. 3333; 

Pub. L. 104–106, div. A, title VIII, Sec. 804, div. D, title XLIII, Sec. 4321(a)(8), Feb. 10, 1996, 

110 Stat. 390, 671; Pub. L. 106–65, div. A, title X, Sec. 1066(a)(23), Oct. 5, 1999, 113 Stat. 771; 

Pub. L. 110–181, div. A, title II, Sec. 232, Jan. 28, 2008, 122 Stat. 46.) 

SUBCHAPTER VI—DEFENSE EXPORT LOAN GUARANTEES 

Sec. 

2540. Establishment of loan guarantee program. 

2540a. Transferability. 

2540b. Limitations. 

2540c. Fees charged and collected. 

2540d. Definitions. 

§ 2540. Establishment of loan guarantee program 

(a) ESTABLISHMENT.—In order to meet the national security objectives in section 2501(a) of this title, the Secretary of Defense 

shall establish a program under which the Secretary may issue 

guarantees assuring a lender against losses of principal or interest, 

or both principal and interest, arising out of the financing of the 

sale or long-term lease of defense articles, defense services, or design and construction services to a country referred to in subsection 

(b). 

(b) COVERED COUNTRIES.—The authority under subsection (a) 

applies with respect to the following countries: 

(1) A member nation of the North Atlantic Treaty Organization (NATO). 

(2) A country designated as of March 31, 1995, as a major 

non-NATO ally pursuant to section 2350a(i)(3) of this title, as 

in effect on that date. 

(3) A country in Central Europe that, as determined by the 

Secretary of State— 

(A) has changed its form of national government from 

a nondemocratic form of government to a democratic form 

of government since October 1, 1989; or 
§ 2540a CH. 148—DEFENSE INDUSTRIAL BASE 1440 

(B) is in the process of changing its form of national 

government from a nondemocratic form of government to 

a democratic form of government. 

(4) A noncommunist country that was a member nation of 

the Asia Pacific Economic Cooperation (APEC) as of October 

31, 1993. 

(c) AUTHORITY SUBJECT TO PROVISIONS OF APPROPRIATIONS.— 

The Secretary may guarantee a loan under this subchapter only to 

such extent or in such amounts as may be provided in advance in 

appropriations Acts. 

(Added Pub. L. 104–106, div. A, title XIII, Sec. 1321(a)(1), Feb. 10, 1996, 110 Stat. 475; amended 

Pub. L. 108–375, div. A, title X, Sec. 1084(d)(21), Oct. 28, 2004, 118 Stat. 2062.) 

§ 2540a. Transferability 

A guarantee issued under this subchapter shall be fully and 

freely transferable. 

(Added Pub. L. 104–106, div. A, title XIII, Sec. 1321(a)(1), Feb. 10, 1996, 110 Stat. 476.) 

§ 2540b. Limitations 

(a) TERMS AND CONDITIONS OF LOAN GUARANTEES.—In issuing 

a guarantee under this subchapter for a medium-term or long-term 

loan, the Secretary may not offer terms and conditions more beneficial than those that would be provided to the recipient by the 

Export-Import Bank of the United States under similar circumstances in conjunction with the provision of guarantees for nondefense articles and services. 

(b) LOSSES ARISING FROM FRAUD OR MISREPRESENTATION.—No 

payment may be made under a guarantee issued under this subchapter for a loss arising out of fraud or misrepresentation for 

which the party seeking payment is responsible. 

(c) NO RIGHT OF ACCELERATION.—The Secretary of Defense 

may not accelerate any guaranteed loan or increment, and may not 

pay any amount, in respect of a guarantee issued under this subchapter, other than in accordance with the original payment terms 

of the loan. 

(Added Pub. L. 104–106, div. A, title XIII, Sec. 1321(a)(1), Feb. 10, 1996, 110 Stat. 476.) 

§ 2540c. Fees charged and collected 

(a) EXPOSURE FEES.—The Secretary of Defense shall charge a 

fee (known as ‘‘exposure fee’’) for each guarantee issued under this 

subchapter. 

(b) AMOUNT OF EXPOSURE FEE.—To the extent that the cost of 

the loan guarantees under this subchapter is not otherwise provided for in appropriations Acts, the fee imposed under subsection 

(a) with respect to a loan guarantee shall be fixed in an amount 

that is sufficient to meet potential liabilities of the United States 

under the loan guarantee. 

(c) PAYMENT TERMS.—The fee under subsection (a) for each 

guarantee shall become due as the guarantee is issued. In the case 

of a guarantee for a loan which is disbursed incrementally, and for 

which the guarantee is correspondingly issued incrementally as 

portions of the loan are disbursed, the fee shall be paid incrementally in proportion to the amount of the guarantee that is issued. 
1441 § 2541 CH. 148—DEFENSE INDUSTRIAL BASE 

(d) ADMINISTRATIVE FEES.—(1) The Secretary of Defense shall 

charge a fee for each guarantee issued under this subchapter to reflect the additional administrative costs of the Department of Defense that are directly attributable to the administration of the program under this subchapter. Such fees shall be credited to a special 

account in the Treasury. Amounts in the special account shall be 

available, to the extent and in amounts provided in appropriations 

Acts, for paying the costs of administrative expenses of the Department of Defense that are attributable to the loan guarantee program under this subchapter. 

(2)(A) If for any fiscal year amounts in the special account established under paragraph (1) are not available (or are not anticipated to be available) in a sufficient amount for administrative expenses of the Department of Defense for that fiscal year that are 

directly attributable to the administration of the program under 

this subchapter, the Secretary may use amounts currently available for operations and maintenance for Defense-wide activities, 

not to exceed $500,000 in any fiscal year, for those expenses. 

(B) The Secretary shall, from funds in the special account established under paragraph (1), replenish operations and maintenance accounts for amounts expended under subparagraph (A) as 

soon as the Secretary determines practicable. 

(Added Pub. L. 104–106, div. A, title XIII, Sec. 1321(a)(1), Feb. 10, 1996, 110 Stat. 476; amended 

Pub. L. 106–398, Sec. 1 [[div. A], title X, Sec. 1081(a)], Oct. 30, 2000, 114 Stat. 1654, 1654A– 

284.) 

§ 2540d. Definitions 

In this subchapter: 

(1) The terms ‘‘defense article’’, ‘‘defense services’’, and ‘‘design and construction services’’ have the meanings given those 

terms in section 47 of the Arms Export Control Act (22 U.S.C. 

2794). 

(2) The term ‘‘cost’’, with respect to a loan guarantee, has 

the meaning given that term in section 502 of the Congressional Budget and Impoundment Control Act of 1974 (2 U.S.C. 

661a). 

(Added Pub. L. 104–106, div. A, title XIII, Sec. 1321(a)(1), Feb. 10, 1996, 110 Stat. 477.) 

SUBCHAPTER VII—CRITICAL INFRASTRUCTURE 

PROTECTION LOAN GUARANTEES 

Sec. 

2541. Establishment of loan guarantee program. 

2541a. Fees charged and collected. 

2541b. Administration. 

2541c. Transferability, additional limitations, and definition. 

2541d. Reports. 

§ 2541. Establishment of loan guarantee program 

(a) ESTABLISHMENT.—In order to meet the national security objectives in section 2501(a) of this title, the Secretary of Defense 

shall establish a program under which the Secretary may issue 

guarantees assuring lenders against losses of principal or interest, 

or both principal and interest, for loans made to qualified commercial firms to fund, in whole or in part, any of the following activities: 
§ 2541a CH. 148—DEFENSE INDUSTRIAL BASE 1442 

(1) The improvement of the protection of the critical infrastructure of the commercial firms. 

(2) The refinancing of improvements previously made to 

the protection of the critical infrastructure of the commercial 

firms. 

(b) QUALIFIED COMMERCIAL FIRMS.—For purposes of this section, a qualified commercial firm is a company or other business 

entity (including a consortium of such companies or other business 

entities, as determined by the Secretary) that the Secretary determines— 

(1) conducts a significant level of its research, development, engineering, and manufacturing activities in the United 

States; 

(2) is a company or other business entity the majority ownership or control of which is by United States citizens or is a 

company or other business of a parent company that is incorporated in a country the government of which— 

(A) encourages the participation of firms so owned or 

controlled in research and development consortia to which 

the government of that country provides funding directly 

or provides funding indirectly through international organizations or agreements; and 

(B) affords adequate and effective protection for the intellectual property rights of companies incorporated in the 

United States; 

(3) provides technology products or services critical to the 

operations of the Department of Defense; 

(4) meets standards of prevention of cyberterrorism applicable to the Department of Defense; and 

(5) agrees to submit the report required under section 

2541d of this title. 

(c) LOAN LIMITS.—The maximum amount of loan principal 

guaranteed during a fiscal year under this section may not exceed 

$10,000,000, with respect to all borrowers. 

(d) GOALS AND STANDARDS.—The Secretary shall prescribe regulations setting forth goals for the use of the loan guarantees provided under this section and standards for evaluating whether 

those goals are met by each entity receiving such loan guarantees. 

(e) AUTHORITY SUBJECT TO PROVISIONS OF APPROPRIATIONS.— 

The Secretary may guarantee a loan under this subchapter only to 

such extent or in such amounts as may be provided in advance in 

appropriations Acts. 

(Added Pub. L. 106–398, Sec. 1 [[div. A], title X, Sec. 1033(a)(1)], Oct. 30, 2000, 114 Stat. 1654, 

1654A–258.) 

§ 2541a. Fees charged and collected 

(a) FEE REQUIRED.—The Secretary of Defense shall assess a fee 

for providing a loan guarantee under this subchapter. 

(b) AMOUNT OF FEE.—The amount of the fee shall be not less 

than 75 percent of the amount incurred by the Secretary to provide 

the loan guarantee. 

(c) SPECIAL ACCOUNT.—(1) Such fees shall be credited to a special account in the Treasury. 
1443 § 2541d CH. 148—DEFENSE INDUSTRIAL BASE 

(2) Amounts in the special account shall be available, to the extent and in amounts provided in appropriations Acts, for paying 

the costs of administrative expenses of the Department of Defense 

that are attributable to the loan guarantee program under this 

subchapter. 

(3)(A) If for any fiscal year amounts in the special account established under paragraph (1) are not available (or are not anticipated to be available) in a sufficient amount for administrative expenses of the Department of Defense for that fiscal year that are 

directly attributable to the administration of the program under 

this subchapter, the Secretary may use amounts currently available for operations and maintenance for Defense-wide activities, 

not to exceed $500,000 in any fiscal year, for those expenses. 

(B) The Secretary shall, from funds in the special account established under paragraph (1), replenish operations and maintenance accounts for amounts expended under subparagraph (A). 

(Added Pub. L. 106–398, Sec. 1 [[div. A], title X, Sec. 1033(a)(1)], Oct. 30, 2000, 114 Stat. 1654, 

1654A–259.) 

§ 2541b. Administration 

(a) AGREEMENTS REQUIRED.—The Secretary of Defense may 

enter into one or more agreements, each with an appropriate Federal or private entity, under which such entity may, under this 

subchapter— 

(1) process applications for loan guarantees; 

(2) administer repayment of loans; and 

(3) provide any other services to the Secretary to administer this subchapter. 

(b) TREATMENT OF COSTS.—The costs of such agreements shall 

be considered, for purposes of the special account established under 

section 2541a(c), to be costs of administrative expenses of the Department of Defense that are attributable to the loan guarantee 

program under this subchapter. 

(Added Pub. L. 106–398, Sec. 1 [[div. A], title X, Sec. 1033(a)(1)], Oct. 30, 2000, 114 Stat. 1654, 

1654A–259.) 

§ 2541c. Transferability, additional limitations, and definition 

The following provisions of subchapter VI of this chapter apply 

to guarantees issued under this subchapter: 

(1) Section 2540a, relating to transferability of guarantees. 

(2) Subsections (b) and (c) of section 2540b, providing limitations. 

(3) Section 2540d(2), providing a definition of the term 

‘‘cost’’. 

(Added Pub. L. 106–398, Sec. 1 [[div. A], title X, Sec. 1033(a)(1)], Oct. 30, 2000, 114 Stat. 1654, 

1654A–260; amended Pub. L. 107–107, title X, Sec. 1048(a)(24), Dec. 28, 2001, 115 Stat. 1224.) 

§ 2541d. Reports 

The Secretary of Defense shall require each qualified commercial firm for which a loan is guaranteed under this subchapter to 

submit to the Secretary a report on the improvements financed or 

refinanced with the loan. The report shall include an assessment 
§ 2541d CH. 148—DEFENSE INDUSTRIAL BASE 1444 

of the value of the improvements for the protection of the critical 

infrastructure of that commercial firm. The Secretary shall prescribe the time for submitting the report. 

(Added Pub. L. 106–398, Sec. 1 [[div. A], title X, Sec. 1033(a)(1)], Oct. 30, 2000, 114 Stat. 1654, 

1654A–260; amended Pub. L. 108–136, div. A, title X, Sec. 1031(a)(25), Nov. 24, 2003, 117 Stat. 

1598.) 
1445 

CHAPTER 149—DEFENSE ACQUISITION SYSTEM 

Sec. 

2545. Definitions. 

2546. Civilian management of the defense acquisition system. 

2547. Acquisition-related functions of chiefs of the armed forces. 

2548. Performance assessments of the defense acquisition system. 

§ 2545. Definitions 

In this chapter: 

(1) The term ‘‘acquisition’’ has the meaning provided in 

section 4(16) of the Office of Federal Procurement Policy Act 

(41 U.S.C. 403(16)). 

(2) The term ‘‘defense acquisition system’’ means the workforce engaged in carrying out the acquisition of property and 

services for the Department of Defense; the management structure responsible for directing and overseeing the acquisition of 

property and services for the Department of Defense; and the 

statutory, regulatory, and policy framework that guides the acquisition of property and services for the Department of Defense. 

(3) The term ‘‘element of the defense acquisition system’’ 

means an organization that employs members of the acquisition workforce, carries out acquisition functions, and focuses 

primarily on acquisition. 

(4) The term ‘‘acquisition workforce’’ has the meaning provided in section 101(a)(18) of this title. 

(Added Pub. L. 111–383, div. A, title VIII, Sec. 861(a), Jan. 7, 2011, 124 Stat. 4288.) 

§ 2546. Civilian management of the defense acquisition system 

(a) RESPONSIBILITY OF THE UNDER SECRETARY OF DEFENSE FOR

ACQUISITION, TECHNOLOGY, AND LOGISTICS.—Subject to the authority, direction and control of the Secretary of Defense, the Under 

Secretary of Defense for Acquisition, Technology, and Logistics 

shall be responsible for the management of the defense acquisition 

system and shall exercise such control of the system and perform 

such duties as are necessary to ensure the successful and efficient 

operation of the defense acquisition system, including the duties 

enumerated and assigned to the Under Secretary elsewhere in this 

title. 

(b) RESPONSIBILITY OF THE SERVICE ACQUISITION EXECU- TIVES.—Subject to the direction of the Under Secretary of Defense 

for Acquisition, Technology, and Logistics on matters pertaining to 

acquisition, and subject to the authority, direction, and control of 

the Secretary of the military department concerned, a service acquisition executive of a military department shall be responsible for 

the management of elements of the defense acquisition system in 

that military department and shall exercise such control of the sys-
§ 2547 CH. 149—DEFENSE ACQUISITION SYSTEM 1446 

tem and perform such duties as are necessary to ensure the successful and efficient operation of such elements of the defense acquisition system. 

(Added Pub. L. 111–383, div. A, title VIII, Sec. 861(a), Jan. 7, 2011, 124 Stat. 4288.) 

§ 2547. Acquisition-related functions of chiefs of the armed 

forces 

(a) PERFORMANCE OF CERTAIN ACQUISITION-RELATED FUNC- TIONS.—The Secretary of Defense shall ensure that 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 assist 

the Secretary of the military department concerned in the performance of the following acquisition-related functions of such department: 

(1) The development of requirements relating to the defense acquisition system (subject, where appropriate, to validation by the Joint Requirements Oversight Council pursuant to 

section 181 of this title). 

(2) The coordination of measures to control requirements 

creep in the defense acquisition system. 

(3) The development of career paths in acquisition for military personnel (as required by section 1722a of this title). 

(4) The assignment and training of contracting officer representatives when such representatives are required to be 

members of the armed forces because of the nature of the contract concerned. 

(b) RULE OF CONSTRUCTION.—Nothing in this section shall be 

construed to affect the assignment of functions under section 

3014(c)(1)(A), section 5014(c)(1)(A), or section 8014(c)(1)(A) of this 

title, except as explicitly provided in this section. 

(c) DEFINITIONS.—In this section: 

(1) The term ‘‘requirements creep’’ means the addition of 

new technical or operational specifications after a requirements document is approved by the appropriate validation authority for the requirements document. 

(2) The term ‘‘requirements document’’ means a document 

produced in the requirements process that is provided for an 

acquisition program to guide the subsequent development, production, and testing of the program and that— 

(A) justifies the need for a materiel approach, or an 

approach that is a combination of materiel and non-materiel, to satisfy one or more specific capability gaps; 

(B) details the information necessary to develop an increment of militarily useful, logistically supportable, and 

technically mature capability, including key performance 

parameters; or 

(C) identifies production attributes required for a single increment of a program. 

(Added Pub. L. 111–383, div. A, title VIII, Sec. 861(a), Jan. 7, 2011, 124 Stat. 4289.) 

§ 2548. Performance assessments of the defense acquisition 

system 

(a) PERFORMANCE ASSESSMENTS REQUIRED.—Not later than 

180 days after the date of the enactment of the Ike Skelton Na-
1447 § 2548 CH. 149—DEFENSE ACQUISITION SYSTEM 

1So in original; subsection (a)(3) should probably have a period at the end. 

tional Defense Authorization Act for Fiscal Year 2011, the Secretary of Defense, acting through the Under Secretary of Defense 

for Acquisition, Technology, and Logistics, the Director of Procurement and Acquisition Policy, and the Director of the Office of Performance Assessment and Root Cause Analysis, shall issue guidance, with detailed implementation instructions, for the Department of Defense to provide for periodic independent performance 

assessments of elements of the defense acquisition system for the 

purpose of— 

(1) determining the extent to which such elements of the 

defense acquisition system deliver value to the Department of 

Defense, taking into consideration the performance elements 

identified in subsection (b); 

(2) assisting senior officials of the Department of Defense 

in identifying and developing lessons learned from best practices and shortcomings in the performance of such elements of 

the defense acquisition system; and 

(3) assisting senior officials of the Department of Defense 

in developing acquisition workforce excellence under section 

1701a of this title 1

(b) AREAS CONSIDERED IN PERFORMANCE ASSESSMENTS.—(1) 

Each performance assessment conducted pursuant to subsection (a) 

shall consider, at a minimum— 

(A) the extent to which acquisitions conducted by the element of the defense acquisition system under review meet applicable cost, schedule, and performance objectives; and 

(B) the staffing and quality of the acquisition workforce 

and the effectiveness of the management of the acquisition 

workforce, including workforce incentives and career paths. 

(2) The Secretary of Defense shall ensure that the performance 

assessments required by this section are appropriately tailored to 

reflect the diverse nature of the work performed by each element 

of the defense acquisition system. In addition to the mandatory 

areas under paragraph (1), a performance assessment may consider, as appropriate, specific areas of acquisition concern, such 

as— 

(A) the selection of contractors, including— 

(i) the extent of competition and the use of exceptions 

to competition requirements; 

(ii) compliance with Department of Defense policies regarding the participation of small business concerns and 

various categories of small business concerns, including 

the use of contract bundling and the availability of nonbundled contract vehicles; 

(iii) the quality of market research; 

(iv) the effective consideration of contractor past performance; and 

(v) the number of bid protests, the extent to which 

such bid protests have been successful, and the reasons for 

such success; 

(B) the negotiation of contracts, including— 
§ 2548 CH. 149—DEFENSE ACQUISITION SYSTEM 1448 

(i) the appropriate application of section 2306a of this 

title (relating to truth in negotiations); 

(ii) the appropriate use of contract types appropriate 

to specific procurements; 

(iii) the appropriate use of performance requirements; 

(iv) the appropriate acquisition of technical data and 

other rights and assets necessary to support long-term 

sustainment and follow-on procurement; and 

(v) the timely definitization of any undefinitized contract actions; and 

(C) the management of contractor performance, including— 

(i) the assignment of appropriately qualified contracting officer representatives and other contract management personnel; 

(ii) the extent of contract disputes, the reasons for 

such disputes, and the extent to which they have been successfully addressed; 

(iii) the appropriate consideration of long-term 

sustainment and energy efficiency objectives; and 

(iv) the appropriate use of integrated testing. 

(c) CONTENTS OF GUIDANCE.—The guidance issued pursuant to 

subsection (a) shall ensure that each element of the defense acquisition system is subject to a performance assessment under this 

section not less often than once every four years, and shall address, 

at a minimum— 

(1) the designation of elements of the defense acquisition 

system that are subject to performance assessment at an organizational level that ensures such assessments can be performed in an efficient and integrated manner; 

(2) the frequency with which such performance assessments should be conducted; 

(3) goals, standards, tools, and metrics for use in conducting performance assessments; 

(4) the composition of the teams designated to perform performance assessments; 

(5) any phase-in requirements needed to ensure that qualified staff are available to perform performance assessments; 

(6) procedures for tracking the implementation of recommendations made pursuant to performance assessments; 

(7) procedures for developing and disseminating lessons 

learned from performance assessments; and 

(8) procedures for ensuring that information from performance assessments are retained electronically and are provided 

in a timely manner to the Under Secretary of Defense for Acquisition, Technology, and Logistics and the Director of the Office of Performance Assessment and Root Cause Analysis as 

needed to assist them in performing their responsibilities 

under this section. 

(d) PERFORMANCE GOALS UNDER GOVERNMENT PERFORMANCE

RESULTS ACT OF 1993.—Beginning with fiscal year 2012, the annual performance plan prepared by the Department of Defense pursuant to section 1115 of title 31 shall include appropriate performance goals for elements of the defense acquisition system. 
1449 § 2548 CH. 149—DEFENSE ACQUISITION SYSTEM 

2 In subsection (e)(2), ‘‘section 103(f) of the Weapon Systems Acquisition Reform Act of 2009 

(10 U.S.C. 2430 note)’’ should be ‘‘section 2438(f) of this title’’. 

(e) REPORTING REQUIREMENTS.—Beginning with fiscal year 

2012— 

(1) the annual report prepared by the Secretary of Defense 

pursuant to section 1116 of title 31, United States Code, shall 

address the Department’s success in achieving performance 

goals established pursuant to such section for elements of the 

defense acquisition system; and 

(2) the annual report prepared by the Director of the Office 

of Performance Assessment and Root Cause Analysis pursuant 

to section 103(f) of the Weapon Systems Acquisition Reform 

Act of 2009 (10 U.S.C. 2430 note) 2, shall include information 

on the activities undertaken by the Department pursuant to 

such section, including a summary of significant findings or 

recommendations arising out of performance assessments. 

(Added Pub. L. 111–383, div. A, title VIII, Sec. 861(a), Jan. 7, 2011, 124 Stat. 4289.) 
1450 

[CHAPTER 150—REPEALED] 

[§§ 2521–2523. Repealed P.L. 102–494, § 4202(a), Oct. 23, 1992, 

106 Stat. 2659] 

[§ 2524. Transferred to § 2513] 

[§ 2525. Transferred to § 2517] 

[§ 2526. Transferred to § 2518] 

CHAPTER 152—ISSUE OF SUPPLIES, SERVICES, AND 

FACILITIES 

Sec. 

2551. Equipment and barracks: national veterans’ organizations. 

2552. Equipment for instruction and practice: American National Red Cross. 

2553. Equipment and services: Presidential inaugural ceremonies. 

2554. Equipment and other services: Boy Scout Jamborees. 

2555. Transportation services: international Girl Scout events. 

2556. Shelter for homeless; incidental services. 

2557. Excess nonlethal supplies: availability for humanitarian relief, domestic 

emergency assistance, and homeless veterans assistance. 

2558. National military associations: assistance at national conventions. 

2559. Provision of medical care to foreign military and diplomatic personnel: reimbursement required; waiver for provision of reciprocal services. 

2560. Aircraft and vehicles: limitation on leasing to non-Federal agencies. 

2561. Humanitarian assistance. 

2562. Limitation on use of excess construction or fire equipment from Department of Defense stocks in foreign assistance or military sales programs. 

2563. Articles and services of industrial facilities: sale to persons outside the Department of Defense. 

2564. Provision of support for certain sporting events. 

2565. Nuclear test monitoring equipment: furnishing to foreign governments. 

2566. Space and services: provision to military welfare societies. 

[2567. Repealed.] 

2568. Retention of combat uniforms by members deployed in support of contingency operations. 

§ 2551. Equipment and barracks: national veterans’ organizations 

(a) The Secretary of a military department, under conditions 

prescribed by him, may lend cots, blankets, pillows, mattresses, bed 

sacks, and other supplies under the jurisdiction of that department 

to any recognized national veterans’ organization for use at its national or state convention or national youth athletic or recreation 

tournament. He may, under conditions prescribed by him, also permit the organization to use unoccupied barracks under the jurisdiction of that department for such an occasion. 

(b) Property lent under subsection (a) may be delivered on 

terms and at times agreed upon by the Secretary of the military 

department concerned and representatives of the veterans’ organi-
1451 § 2553 CH. 152—ISSUE OF SUPPLIES, SERVICES, AND FACILITIES 

zation. However, the veterans’ organization must defray any expense incurred by the United States in the delivery, return, rehabilitation, or replacement of that property, as determined by the 

Secretary. 

(c) The Secretary of the military department concerned shall 

require a good and sufficient bond for the return in good condition 

of property lent or used under subsection (a). 

(Aug. 10, 1956, ch. 1041, 70A Stat. 142, Sec. 2541; renumbered Sec. 2551, Pub. L. 106–398, Sec. 

1 [[div. A], title X, Sec. 1033(b)(1)], Oct. 30, 2000, 114 Stat. 1654, 1654A–260.) 

§ 2552. Equipment for instruction and practice: American 

National Red Cross 

The Secretary of a military department, under regulations to 

be prescribed by him, may lend equipment under the jurisdiction 

of that department that is on hand, and that can be temporarily 

spared, to any organization formed by the American National Red 

Cross that needs it for instruction and practice for the purpose of 

aiding the Army, Navy, or Air Force in time of war. The Secretary 

shall by regulation require the immediate return, upon request, of 

equipment lent under this section. The Secretary shall require a 

bond, in double the value of the property issued under this section, 

for the care and safekeeping of that property and for its return 

when required. 

(Aug. 10, 1956, ch. 1041, 70A Stat. 142, Sec. 2542; renumbered Sec. 2552, Pub. L. 106–398, Sec. 

1 [[div. A], title X, Sec. 1033(b)(1)], Oct. 30, 2000, 114 Stat. 1654, 1654A–260.) 

§ 2553. Equipment and services: Presidential inaugural ceremonies 

(a) ASSISTANCE AUTHORIZED.—The Secretary of Defense may, 

with respect to the ceremonies relating to the inauguration of a 

President, provide the assistance referred to in subsection (b) to— 

(1) the Presidential Inaugural Committee; and 

(2) the congressional Joint Inaugural Committee. 

(b) ASSISTANCE.—Assistance that may be provided under subsection (a) is the following: 

(1) Planning and carrying out activities relating to security 

and safety. 

(2) Planning and carrying out ceremonial activities. 

(3) Loan of property. 

(4) Any other assistance that the Secretary considers appropriate. 

(c) REIMBURSEMENT.—(1) The Presidential Inaugural Committee shall reimburse the Secretary for any costs incurred in connection with the provision to the committee of assistance referred 

to in subsection (b)(4). 

(2) Costs reimbursed under paragraph (1) shall be credited to 

the appropriations from which the costs were paid. The amount 

credited to an appropriation shall be proportionate to the amount 

of the costs charged to that appropriation. 

(d) LOANED PROPERTY.—With respect to property loaned for a 

presidential inauguration under subsection (b)(3), the Presidential 

Inaugural Committee shall— 

(1) return that property within nine days after the date of 

the ceremony inaugurating the President; 
§ 2554 CH. 152—ISSUE OF SUPPLIES, SERVICES, AND FACILITIES 1452 

(2) give good and sufficient bond for the return in good 

order and condition of that property; 

(3) indemnify the United States for any loss of, or damage 

to, that property; and 

(4) defray any expense incurred for the delivery, return, rehabilitation, replacement, or operation of that property. 

(e) DEFINITIONS.—In this section: 

(1) The term ‘‘Presidential Inaugural Committee’’ means 

the committee referred to in section 501 of title 36 that is appointed with respect to the inauguration of a President-elect 

and Vice President-elect. 

(2) The term ‘‘congressional Joint Inaugural Committee’’ 

means the joint committee of the Senate and House of Representatives referred to in section 507 of title 36 that is appointed with respect to the inauguration of a President-elect 

and Vice President-elect. 

(Added Pub. L. 85–861, Sec. 1(48)(A), Sept. 2, 1958, 72 Stat. 1458, Sec. 2543; amended Pub. L. 

96–513, title V, Sec. 511(81), Dec. 12, 1980, 94 Stat. 2927; Pub. L. 104–201, div. A, title III, 

Sec. 366(a), Sept. 23, 1996, 110 Stat. 2495; Pub. L. 105–225, Sec. 4(a)(2), Aug. 12, 1998, 112 

Stat. 1498; renumbered Sec. 2553, Pub. L. 106–398, Sec. 1 [[div. A], title X, Sec. 1033(b)(1)], 

Oct. 30, 2000, 114 Stat. 1654, 1654A–260.) 

§ 2554. Equipment and other services: Boy Scout Jamborees 

(a) The Secretary of Defense is hereby authorized, under such 

regulations as he may prescribe, to lend to the Boy Scouts of America, for the use and accommodation of Scouts, Scouters, and officials who attend any national or world Boy Scout Jamboree, such 

cots, blankets, commissary equipment, flags, refrigerators, and 

other equipment and without reimbursement, furnish services and 

expendable medical supplies, as may be necessary or useful to the 

extent that items are in stock and items or services are available. 

(b) Such equipment is authorized to be delivered at such time 

prior to the holding of any national or world Boy Scout Jamboree, 

and to be returned at such time after the close of any such jamboree, as may be agreed upon by the Secretary of Defense and the 

Boy Scouts of America. No expense shall be incurred by the United 

States Government for the delivery, return, rehabilitation, or replacement of such equipment. 

(c) The Secretary of Defense, before delivering such property, 

shall take from the Boy Scouts of America, good and sufficient bond 

for the safe return of such property in good order and condition, 

and the whole without expense to the United States. 

(d) The Secretary of Defense is hereby authorized under such 

regulations as he may prescribe, to provide, without expense to the 

United States Government, transportation from the United States 

or military commands overseas, and return, on vessels of the Military Sealift Command or aircraft of the Air Mobility Command for 

(1) those Boy Scouts, Scouters, and officials certified by the Boy 

Scouts of America, as representing the Boy Scouts of America at 

any national or world Boy Scout Jamboree, and (2) the equipment 

and property of such Boy Scouts, Scouters, and officials and the 

property loaned to the Boy Scouts of America, by the Secretary of 

Defense pursuant to this section to the extent that such transportation will not interfere with the requirements of military operations. 
1453 § 2555 CH. 152—ISSUE OF SUPPLIES, SERVICES, AND FACILITIES 

(e) Before furnishing any transportation under subsection (d), 

the Secretary of Defense shall take from the Boy Scouts of America, a good and sufficient bond for the reimbursement to the United 

States by the Boy Scouts of America, of the actual costs of transportation furnished under this section. 

(f) Amounts paid to the United States to reimburse it for expenses incurred under subsection (b) and for the actual costs of 

transportation furnished under subsection (d) shall be credited to 

the current applicable appropriations or funds to which such expenses and costs were charged and shall be available for the same 

purposes as such appropriations or funds. 

(g) In the case of a Boy Scout Jamboree held on a military installation, the Secretary of Defense may provide personnel services 

and logistical support at the military installation in addition to the 

support authorized under subsections (a) and (d). 

(h) Other departments of the Federal Government are authorized, under such regulations as may be prescribed by the Secretary 

thereof, to provide to the Boy Scouts of America, equipment and 

other services, under the same conditions and restrictions prescribed in the preceding subsections for the Secretary of Defense. 

(i)(1) The Secretary of Defense shall provide at least the same 

level of support under this section for a national or world Boy 

Scout Jamboree as was provided under this section for the preceding national or world Boy Scout Jamboree. 

(2) The Secretary of Defense may waive paragraph (1), if the 

Secretary— 

(A) determines that providing the support subject to paragraph (1) would be detrimental to the national security of the 

United States; and 

(B) submits to Congress a report containing such determination in a timely manner, and before the waiver takes effect. 

(Added Pub. L. 92–249, Mar. 10, 1972, 86 Stat. 62, Sec. 2544; Pub. L. 104–106, div. A, title III, 

Sec. 376, Feb. 10, 1996, 110 Stat. 283; renumbered Sec. 2554, Pub. L. 106–398, Sec. 1 [[div. A], 

title X, Sec. 1033(b)(1)], Oct. 30, 2000, 114 Stat. 1654, 1654A–260; Pub. L. 107–107, div. A, title 

IX, Sec. 931(a), Dec. 28, 2001, 115 Stat. 1200; Pub. L. 109–148, div. A, title VIII, Sec. 8126(c)(2), 

Dec. 30, 2005, 119 Stat. 2729; Pub. L. 109–163, div. A, title X, Sec. 1058(c), Jan. 6, 2006, 119 

Stat. 3443.) 

§ 2555. Transportation services: international Girl Scout 

events 

(a) The Secretary of Defense is authorized, under such regulations as he may prescribe, to provide, without expense to the 

United States Government, transportation from the United States 

or military commands overseas, and return, on vessels of the Military Sealift Command or aircraft of the Air Mobility Command for 

(1) those Girl Scouts and officials certified by the Girl Scouts of the 

United States of America as representing the Girl Scouts of the 

United States of America at any International World Friendship 

Event or Troops on Foreign Soil meeting which is endorsed and approved by the National Board of Directors of the Girl Scouts of the 

United States of America and is conducted outside of the United 

States, (2) United States citizen delegates coming from outside of 

the United States to triennial meetings of the National Council of 

the Girl Scouts of the United States of America, and (3) the equip-
§ 2556 CH. 152—ISSUE OF SUPPLIES, SERVICES, AND FACILITIES 1454 

ment and property of such Girl Scouts and officials, to the extent 

that such transportation will not interfere with the requirements 

of military operations. 

(b) Before furnishing any transportation under subsection (a), 

the Secretary of Defense shall take from the Girl Scouts of the 

United States of America a good and sufficient bond for the reimbursement to the United States by the Girl Scouts of the United 

States of America, of the actual costs of transportation furnished 

under subsection (a). 

(c) Amounts paid to the United States to reimburse it for the 

actual costs of transportation furnished under subsection (a) shall 

be credited to the current applicable appropriations or funds to 

which such costs were charged and shall be available for the same 

purposes as such appropriations or funds. 

(Added Pub. L. 95–492, Sec. 1, Oct. 20, 1978, 92 Stat. 1642, Sec. 2545; renumbered Sec. 2555, 

Pub. L. 106–398, Sec. 1 [[div. A], title X, Sec. 1033(b)(1)], Oct. 30, 2000, 114 Stat. 1654, 1654A– 

260; Pub. L. 107–107, div. A, title IX, Sec. 931(a), Dec. 28, 2001, 115 Stat. 1200.) 

§ 2556. Shelter for homeless; incidental services 

(a)(1) The Secretary of a military department may make military installations under his jurisdiction available for the furnishing 

of shelter to persons without adequate shelter. The Secretary may, 

incidental to the furnishing of such shelter, provide services as described in subsection (b). Shelter and incidental services provided 

under this section may be provided without reimbursement. 

(2) The Secretary concerned shall carry out this section in cooperation with appropriate State and local governmental entities 

and charitable organizations. The Secretary shall, to the maximum 

extent practicable, use the services and personnel of such entities 

and organizations in determining to whom and the circumstances 

under which shelter is furnished under this section. 

(b) Services that may be provided incident to the furnishing of 

shelter under this section are the following: 

(1) Utilities. 

(2) Bedding. 

(3) Security. 

(4) Transportation. 

(5) Renovation of facilities. 

(6) Minor repairs undertaken specifically to make suitable 

space available for shelter to be provided under this section. 

(7) Property liability insurance. 

(c) Shelter and incidental services may only be provided under 

this section to the extent that the Secretary concerned determines 

will not interfere with military preparedness or ongoing military 

functions. 

(d) The Secretary concerned may provide bedding for support 

of shelters for the homeless that are operated by entities other 

than the Department of Defense. Bedding may be provided under 

this subsection without reimbursement, but may only be provided 

to the extent that the Secretary determines that the provision of 

such bedding will not interfere with military requirements. 

(e) The Secretary of Defense shall prescribe regulations for the 

administration of this section. 
1455 § 2558 CH. 152—ISSUE OF SUPPLIES, SERVICES, AND FACILITIES 

(Added Pub. L. 98–94, title III, Sec. 305(a)(1), Sept. 24, 1983, 97 Stat. 628, Sec. 2546; amended 

Pub. L. 99–167, title VIII, Sec. 825, Dec. 3, 1985, 99 Stat. 992; renumbered Sec. 2556, Pub. L. 

106–398, Sec. 1 [[div. A], title X, Sec. 1033(b)(1)], Oct. 30, 2000, 114 Stat. 1654, 1654A–260.) 

§ 2557. Excess nonlethal supplies: availability for humanitarian relief, domestic emergency assistance, and 

homeless veterans assistance 

(a)(1) The Secretary of Defense may make available for humanitarian relief purposes any nonlethal excess supplies of the Department of Defense. In addition, the Secretary may make nonlethal 

excess supplies of the Department available to support domestic 

emergency assistance activities. 

(2) The Secretary of Defense may make excess clothing, shoes, 

sleeping bags, and related nonlethal excess supplies available to 

the Secretary of Veterans Affairs for distribution to homeless veterans and programs assisting homeless veterans. The transfer of 

nonlethal excess supplies to the Secretary of Veterans Affairs 

under this paragraph shall be without reimbursement. 

(b)(1) Excess supplies made available for humanitarian relief 

purposes under this section shall be transferred to the Secretary of 

State, who shall be responsible for the distribution of such supplies. 

(2) Excess supplies made available under this section to support domestic emergency assistance activities shall be transferred 

to the Secretary of Homeland Security. The Secretary of Defense 

may provide assistance in the distribution of such supplies at the 

request of the Secretary of Homeland Security. 

(c) This section does not constitute authority to conduct any activity which, if carried out as an intelligence activity by the Department of Defense, would require a notice to the intelligence committees under title V of the National Security Act of 1947 (50 U.S.C. 

413 et seq.). 

(d) In this section: 

(1) The term ‘‘nonlethal excess supplies’’ means property, 

other than real property, of the Department of Defense— 

(A) that is excess property, as defined in regulations of 

the Department of Defense; and 

(B) that is not a weapon, ammunition, or other equipment or material that is designed to inflict serious bodily 

harm or death. 

(2) The term ‘‘intelligence committees’’ means the Select 

Committee on Intelligence of the Senate and the Permanent 

Select Committee on Intelligence of the House of Representatives. 

(Added Pub. L. 99–145, title XIV, Sec. 1454(a), Nov. 8, 1985, 99 Stat. 761, Sec. 2547; amended 

Pub. L. 100–26, Sec. 7(k)(2), Apr. 21, 1987, 101 Stat. 284; Pub. L. 101–510, div. A, title XIII, 

Sec. 1322(a)(10), Nov. 5, 1990, 104 Stat. 1671; Pub. L. 102–88, title VI, Sec. 602(c)(3), Aug. 14, 

1991, 105 Stat. 444; renumbered Sec. 2557, Pub. L. 106–398, Sec. 1 [[div. A], title X, Sec. 

1033(b)(1)], Oct. 30, 2000, 114 Stat. 1654, 1654A–260; Pub. L. 107–107, div. A, title III, Sec. 

312(a), (b)(1), Dec. 28, 2001, 115 Stat. 1064, 1065; Pub. L. 111–383, div. A, title X, Sec. 1074(a), 

(b)(1), Jan. 7, 2011, 124 Stat. 4368.) 

§ 2558. National military associations: assistance at national 

conventions 

(a) AUTHORITY TO PROVIDE SERVICES.—The Secretary of a military department may provide services described in subsection (c) in 
§ 2559 CH. 152—ISSUE OF SUPPLIES, SERVICES, AND FACILITIES 1456 

connection with an annual conference or convention of a national 

military association. 

(b) CONDITIONS FOR PROVIDING SERVICES.—Services may be 

provided under this section only if— 

(1) the provision of the services in any case is approved in 

advance by the Secretary concerned; 

(2) the services can be provided in conjunction with training in appropriate military skills; and 

(3) the services can be provided within existing funds otherwise available to the Secretary concerned. 

(c) COVERED SERVICES.—Services that may be provided under 

this section are— 

(1) limited air and ground transportation; 

(2) communications; 

(3) medical assistance; 

(4) administrative support; and 

(5) security support. 

(d) NATIONAL MILITARY ASSOCIATIONS.—The Secretary of Defense shall designate those organizations which are national military associations for purposes of this section. 

(e) REGULATIONS.—The Secretary of Defense shall prescribe 

regulations to carry out this section. 

(Added Pub. L. 101–189, div. A, title III, Sec. 329(a)(1), Nov. 29, 1989, 103 Stat. 1417, Sec. 2548; 

renumbered Sec. 2558, Pub. L. 106–398, Sec. 1 [[div. A], title X, Sec. 1033(b)(1)], Oct. 30, 2000, 

114 Stat. 1654, 1654A–260.) 

§ 2559. Provision of medical care to foreign military and 

diplomatic personnel: reimbursement required; 

waiver for provision of reciprocal services 

(a) REIMBURSEMENT REQUIRED.—Except as provided in subsection (b), whenever the Secretary of Defense provides medical 

care in the United States on an inpatient basis to foreign military 

and diplomatic personnel or their dependents, the Secretary shall 

require that the United States be reimbursed for the costs of providing such care. Payments received as reimbursement for the provision of such care shall be credited to the appropriations against 

which charges were made for the provision of such care. 

(b) WAIVER WHEN RECIPROCAL SERVICES PROVIDED UNITED

STATES MILITARY PERSONNEL.—Notwithstanding subsection (a), the 

Secretary of Defense may provide inpatient medical care in the 

United States without cost to military personnel and their dependents from a foreign country if comparable care is made available 

to a comparable number of United States military personnel and 

their dependents in that foreign country. 

(Added Pub. L. 101–510, div. A, title XIV, Sec. 1481(f)(1), Nov. 5, 1990, 104 Stat. 1707, Sec. 

2549; renumbered Sec. 2559, Pub. L. 106–398, Sec. 1 [[div. A], title X, Sec. 1033(b)(1)], Oct. 30, 

2000, 114 Stat. 1654, 1654A–260.) 

§ 2560. Aircraft and vehicles: limitation on leasing to nonFederal agencies 

The Secretary of Defense (or Secretary of a military department) may not lease to a non-Federal agency in the United States 

any aircraft or vehicle owned or operated by the Department of Defense if suitable aircraft or vehicles are commercially available in 

the private sector. However, nothing in the preceding sentence 
1457 § 2561 CH. 152—ISSUE OF SUPPLIES, SERVICES, AND FACILITIES 

shall affect authorized and established procedures for the sale of 

surplus aircraft or vehicles. 

(Added Pub. L. 101–510, div. A, title XIV, Sec. 1481(g)(1), Nov. 5, 1990, 104 Stat. 1707, Sec. 

2550; renumbered Sec. 2560, Pub. L. 106–398, Sec. 1 [[div. A], title X, Sec. 1033(b)(1)], Oct. 30, 

2000, 114 Stat. 1654, 1654A–260.) 

§ 2561. Humanitarian assistance 

(a) AUTHORIZED ASSISTANCE.—(1) To the extent provided in defense authorization Acts, funds authorized to be appropriated to 

the Department of Defense for a fiscal year for humanitarian assistance shall be used for the purpose of providing transportation 

of humanitarian relief and for other humanitarian purposes worldwide. 

(2) The Secretary of Defense may use the authority provided 

by paragraph (1) to transport supplies intended for use to respond 

to, or mitigate the effects of, an event or condition, such as an oil 

spill, that threatens serious harm to the environment, but only if 

other sources to provide such transportation are not readily available. The Secretary may require reimbursement for costs incurred 

by the Department of Defense to transport supplies under this 

paragraph. 

(b) AVAILABILITY OF FUNDS.—To the extent provided in appropriation Acts, funds appropriated for humanitarian assistance for 

the purposes of this section shall remain available until expended. 

(c) STATUS REPORTS.—(1) The Secretary of Defense shall submit to the congressional committees specified in subsection (f) an 

annual report on the provision of humanitarian assistance pursuant to this section for the prior fiscal year. The report shall be submitted each year at the time of the budget submission by the President for the next fiscal year. 

(2) Each report required by paragraph (1) shall cover all provisions of law that authorize appropriations for humanitarian assistance to be available from the Department of Defense for the purposes of this section. 

(3) Each report under this subsection shall set forth the following information regarding activities during the previous fiscal 

year: 

(A) The total amount of funds obligated for humanitarian 

relief under this section. 

(B) The number of scheduled and completed transportation 

missions for purposes of providing humanitarian assistance 

under this section. 

(C) A description of any transfer of excess nonlethal supplies of the Department of Defense made available for humanitarian relief purposes under section 2557 of this title. The description shall include the date of the transfer, the entity to 

whom the transfer is made, and the quantity of items transferred. 

(d) REPORT REGARDING RELIEF FOR UNAUTHORIZED COUN- TRIES.—In any case in which the Secretary of Defense provides for 

the transportation of humanitarian relief to a country to which the 

transportation of humanitarian relief has not been specifically authorized by law, the Secretary shall notify the congressional committees specified in subsection (f) and the Committees on Appro-
§ 2562 CH. 152—ISSUE OF SUPPLIES, SERVICES, AND FACILITIES 1458 

1 In section 2561(f)(2), ‘‘Committee on International Relations’’ should be ‘‘Committee on Foreign Affairs’’. 

priations of the Senate and House of Representatives of the Secretary’s intention to provide such transportation. The notification 

shall be submitted not less than 15 days before the commencement 

of such transportation. 

(e) DEFINITION.—In this section, the term ‘‘defense authorization Act’’ means an Act that authorizes appropriations for one or 

more fiscal years for military activities of the Department of Defense, including authorizations of appropriations for the activities 

described in paragraph (7) of section 114(a) of this title. 

(f) CONGRESSIONAL COMMITTEES.—The congressional committees referred to in subsections (c)(1) and (d) are the following: 

(1) The Committee on Armed Services and the Committee 

on Foreign Relations of the Senate. 

(2) The Committee on Armed Services and the Committee 

on International Relations 1 of the House of Representatives. 

(Added Pub. L. 102–484, div. A, title III, Sec. 304(c)(1), Oct. 23, 1992, 106 Stat. 2361, Sec. 2551; 

amended Pub. L. 104–106, div. A, title XIII, Sec. 1312, Feb. 10, 1996, 110 Stat. 474; Pub. L. 

106–65, div. A, title X, Sec. 1067(1), Oct. 5, 1999, 113 Stat. 774; renumbered and amended Sec. 

2561, Pub. L. 106–398, Sec. 1 [[div. A], title X, Sec. 1033(b)(1), (c)(1)], Oct. 30, 2000, 114 Stat. 

1654, 1654A–260; Pub. L. 108–136, div. A, title III, Sec. 312(d), Nov. 24, 2003, 117 Stat. 1430.) 

§ 2562. Limitation on use of excess construction or fire 

equipment from Department of Defense stocks in 

foreign assistance or military sales programs 

(a) LIMITATION.—Excess construction or fire equipment from 

the stocks of the Department of Defense may be transferred to any 

foreign country or international organization pursuant to part II of 

the Foreign Assistance Act of 1961 (22 U.S.C. 2301 et seq.) or section 21 of the Arms Export Control Act (22 U.S.C. 2761) only if— 

(1) no department or agency of the Federal Government 

(other than the Department of Defense), no State, and no other 

person or entity eligible to receive excess or surplus property 

under subtitle I of title 40 and division C (except sections 3302, 

3501(b), 3509, 3906, 4710, and 4711) of subtitle I of title 41 

submits to the Defense Reutilization and Marketing Service a 

request for such equipment during the period for which the Defense Reutilization and Marketing Service accepts such a request; or 

(2) the President determines that the transfer is necessary 

in order to respond to an emergency for which the equipment 

is especially suited. 

(b) RULE OF CONSTRUCTION.—Nothing in subsection (a) shall 

be construed to limit the authority to transfer construction or fire 

equipment under section 2557 of this title. 

(c) DEFINITION.—In this section, the term ‘‘construction or fire 

equipment’’ includes tractors, scrapers, loaders, graders, bulldozers, 

dump trucks, generators, pumpers, fuel and water tankers, crash 

trucks, utility vans, rescue trucks, ambulances, hook and ladder 

units, compressors, and miscellaneous fire fighting equipment. 

(Added Pub. L. 102–484, div. D, title XLIII, Sec. 4304(a), Oct. 23, 1992, 106 Stat. 2699, Sec. 

2552; renumbered and amended Sec. 2562, Pub. L. 106–398, Sec. 1 [[div. A], title X, Sec. 

1033(b)(1), (c)(2)], Oct. 30, 2000, 114 Stat. 1654, 1654A–260; Pub. L. 107–217, Sec. 3(b)(8), Aug. 
1459 § 2563 CH. 152—ISSUE OF SUPPLIES, SERVICES, AND FACILITIES 

21, 2002, 116 Stat. 1295; Pub. L. 107–314, div. A, title X, Sec. 1062(e)(1), Dec. 2, 2002, 116 Stat. 

2651; Pub. L. 111–350, Sec. 5(b)(41), Jan. 4, 2011, 124 Stat. 3846.) 

§ 2563. Articles and services of industrial facilities: sale to 

persons outside the Department of Defense 

(a) AUTHORITY TO SELL OUTSIDE DOD.—(1) The Secretary of 

Defense may sell in accordance with this section to a person outside the Department of Defense articles and services referred to in 

paragraph (2) that are not available from any United States commercial source. 

(2)(A) Except as provided in subparagraph (B), articles and 

services referred to in paragraph (1) are articles and services that 

are manufactured or performed by any working-capital funded industrial facility of the armed forces. 

(B) The authority in this section does not apply to sales of articles and services by a working-capital funded Army industrial facility (including a Department of the Army arsenal) that manufactures large caliber cannons, gun mounts, recoil mechanisms, ammunition, munitions, or components thereof, which are governed by 

regulations required by section 4543 of this title. 

(b) DESIGNATION OF PARTICIPATING INDUSTRIAL FACILITIES.— 

The Secretary may designate facilities referred to in subsection (a) 

as the facilities from which articles and services manufactured or 

performed by such facilities may be sold under this section. 

(c) CONDITIONS FOR SALES.—(1) A sale of articles or services 

may be made under this section only if— 

(A) the Secretary of Defense determines that the articles 

or services are not available from a commercial source in the 

United States; 

(B) the purchaser agrees to hold harmless and indemnify 

the United States, except as provided in paragraph (3), from 

any claim for damages or injury to any person or property arising out of the articles or services; 

(C) the articles or services can be substantially manufactured or performed by the industrial facility concerned with 

only incidental subcontracting; 

(D) it is in the public interest to manufacture the articles 

or perform the services; 

(E) the Secretary determines that the sale of the articles 

or services will not interfere with the military mission of the 

industrial facility concerned; and 

(F) the sale of the goods and services is made on the basis 

that it will not interfere with performance of work by the industrial facility concerned for the Department of Defense. 

(2) The Secretary of Defense may waive the condition in paragraph (1)(A) and subsection (a)(1) that an article or service must 

be not available from a United States commercial source in the 

case of a particular sale if the Secretary determines that the waiver is necessary for reasons of national security and notifies Congress regarding the reasons for the waiver. 

(3) Paragraph (1)(B) does not apply in any case of willful misconduct or gross negligence or in the case of a claim by a purchaser 

of articles or services under this section that damages or injury 

arose from the failure of the Government to comply with quality, 
§ 2564 CH. 152—ISSUE OF SUPPLIES, SERVICES, AND FACILITIES 1460 

schedule, or cost performance requirements in the contract to provide the articles or services. 

(d) METHODS OF SALE.—(1) The Secretary shall permit a purchaser of articles or services under this section to use advance incremental funding to pay for the articles or services. 

(2) In the sale of articles and services under this section, the 

Secretary shall— 

(A) charge the purchaser, at a minimum, the variable 

costs, capital improvement costs, and equipment depreciation 

costs that are associated with the articles or services sold; 

(B) enter into a firm, fixed-price contract or, if agreed by 

the purchaser, a cost reimbursement contract for the sale; and 

(C) develop and maintain (from sources other than appropriated funds) working capital to be available for paying design 

costs, planning costs, procurement costs, and other costs associated with the articles or services sold. 

(e) DEPOSIT OF PROCEEDS.—Proceeds from sales of articles and 

services under this section shall be credited to the funds, including 

working capital funds and operation and maintenance funds, incurring the costs of manufacture or performance. 

(f) RELATIONSHIP TO ARMS EXPORT CONTROL ACT.—Nothing in 

this section shall be construed to affect the application of the export controls provided for in section 38 of the Arms Export Control 

Act (22 U.S.C. 2778) to items which incorporate or are produced 

through the use of an article sold under this section. 

(g) DEFINITIONS.—In this section: 

(1) The term ‘‘advance incremental funding’’, with respect 

to a sale of articles or services, means a series of partial payments for the articles or services that includes— 

(A) one or more partial payments before the commencement of work or the incurring of costs in connection 

with the manufacture of the articles or the performance of 

the services, as the case may be; and 

(B) subsequent progress payments that result in full 

payment being completed as the required work is being 

completed. 

(2) The term ‘‘not available’’, with respect to an article or 

service proposed to be sold under this section, means that the 

article or service is unavailable from a commercial source in 

the required quantity and quality or within the time required. 

(3) The term ‘‘variable costs’’, with respect to sales of articles or services, means the costs that are expected to fluctuate 

directly with the volume of sales and— 

(A) in the case of articles, the volume of production 

necessary to satisfy the sales orders; or 

(B) in the case of services, the extent of the services 

sold. 

(Added Pub. L. 103–337, div. A, title III, Sec. 339(a)(1), Oct. 5, 1994, 108 Stat. 2718, Sec. 2553; 

Pub. L. 106–65, div. A, title III, Sec. 331(a)(2), (b), Oct. 5, 1999, 113 Stat. 566, 567; renumbered 

Sec. 2563, Pub. L. 106–398, Sec. 1 [[div. A], title X, Sec. 1033(b)(1)], Oct. 30, 2000, 114 Stat. 

1654, 1654A–260; Pub. L. 107–107, title III, Sec. 343(a), Dec. 28, 2001, 115 Stat. 1061.) 

§ 2564. Provision of support for certain sporting events 

(a) SECURITY AND SAFETY ASSISTANCE.—At the request of a 

Federal, State, or local government agency responsible for pro-
1461 § 2564 CH. 152—ISSUE OF SUPPLIES, SERVICES, AND FACILITIES 

viding law enforcement services, security services, or safety services, the Secretary of Defense may authorize the commander of a 

military installation or other facility of the Department of Defense 

or the commander of a specified or unified combatant command to 

provide assistance for the World Cup Soccer Games, the Goodwill 

Games, the Olympics, and any other civilian sporting event in support of essential security and safety at such event, but only if the 

Attorney General certifies that such assistance is necessary to meet 

essential security and safety needs. 

(b) OTHER ASSISTANCE.—The Secretary of Defense may authorize a commander referred to in subsection (a) to provide assistance 

for a sporting event referred to in that subsection in support of 

other needs relating to such event, but only— 

(1) to the extent that such needs cannot reasonably be met 

by a source other than the Department; 

(2) to the extent that the provision of such assistance does 

not adversely affect the military preparedness of the armed 

forces; and 

(3) if the organization requesting such assistance agrees to 

reimburse the Department for amounts expended by the Department in providing the assistance in accordance with the 

provisions of section 377 of this title and other applicable provisions of law. 

(c) INAPPLICABILITY TO CERTAIN EVENTS.—Subsections (a) and 

(b) do not apply to the following sporting events: 

(1) Sporting events for which funds have been appropriated before September 23, 1996. 

(2) The Special Olympics. 

(3) The Paralympics. 

(4) A sporting event sanctioned by the United States 

Olympic Committee through the Paralympic Military Program. 

(5) Any national or international paralympic sporting 

event (other than a sporting event described in paragraphs (1) 

through (4))— 

(A) that— 

(i) is held in the United States or any of its territories or commonwealths; 

(ii) is governed by the International Paralympic 

Committee; and 

(iii) is sanctioned by the United States Olympic 

Committee; 

(B) for which participation exceeds 100 amateur athletes; and 

(C) in which at least 10 percent of the athletes participating in the sporting event are members or former members of the armed forces who are participating in the sporting event based upon an injury or wound incurred in the 

line of duty in the armed force and veterans who are participating in the sporting event based upon a service-connected disability. 

(d) TERMS AND CONDITIONS.—The Secretary of Defense may require such terms and conditions in connection with the provision 

of assistance under this section as the Secretary considers nec-
§ 2565 CH. 152—ISSUE OF SUPPLIES, SERVICES, AND FACILITIES 1462 

essary and appropriate to protect the interests of the United 

States. 

(e) REPORT ON ASSISTANCE.—Not later than January 30 of each 

year following a year in which the Secretary of Defense provides 

assistance under this section, the Secretary shall submit to Congress a report on the assistance provided. The report shall set 

forth— 

(1) a description of the assistance provided; 

(2) the amount expended by the Department in providing 

the assistance; 

(3) if the assistance was provided under subsection (a), the 

certification of the Attorney General with respect to the assistance under that subsection; and 

(4) if the assistance was provided under subsection (b)— 

(A) an explanation why the assistance could not reasonably be met by a source other than the Department; 

and 

(B) the amount the Department was reimbursed under 

that subsection. 

(f) RELATIONSHIP TO OTHER LAWS.—Assistance provided under 

this section shall be subject to the provisions of sections 375 and 

376 of this title. 

(g) FUNDING FOR SUPPORT OF CERTAIN EVENTS.—(1) Amounts 

for the provision of support for a sporting event described in paragraph (4) or (5) of subsection (c) may be derived from the Support 

for International Sporting Competitions, Defense account established by section 5802 of the Omnibus Consolidated Appropriations 

Act, 1997 (Public Law 104–208; 10 U.S.C. 2564 note), notwithstanding any limitation under that section relating to the availability of funds in such account for the provision of support for 

international sporting competitions. 

(2) The total amount expended for any fiscal year to provide 

support for sporting events described in subsection (c)(5) may not 

exceed $1,000,000. 

(Added Pub. L. 104–201, div. A, title III, Sec. 367(a), Sept. 23, 1996, 110 Stat. 2496, Sec. 2554; 

amended by Pub. L. 105–85, div. A, title X, Sec. 1073(a)(56), (c)(2)(A), Nov. 18, 1997, 111 Stat. 

1903, 1904; renumbered Sec. 2564, Pub. L. 106–398, Sec. 1 [[div. A], title X, Sec. 1033(b)(1)], 

Oct. 30, 2000, 114 Stat. 1654, 1654A–260; Pub. L. 110–181, div. A, title III, Sec. 372(a), Jan. 

28, 2008, 122 Stat. 81.) 

§ 2565. Nuclear test monitoring equipment: furnishing to 

foreign governments 

(a) AUTHORITY TO TRANSFER TITLE TO OR OTHERWISE PROVIDE

NUCLEAR TEST MONITORING EQUIPMENT.—Subject to subsection (b), 

the Secretary of Defense may— 

(1) transfer title or otherwise provide to a foreign government (A) equipment for the monitoring of nuclear test explosions, and (B) associated equipment; 

(2) as part of any such conveyance or provision of equipment, install such equipment on foreign territory or in international waters; and 

(3) inspect, test, maintain, repair, or replace any such 

equipment. 

(b) AGREEMENT REQUIRED.—Nuclear test explosion monitoring 
1463 § 2568 CH. 152—ISSUE OF SUPPLIES, SERVICES, AND FACILITIES 

equipment may be provided to a foreign government under subsection (a) only pursuant to the terms of an agreement between the 

United States and the foreign government receiving the equipment 

in which the recipient foreign government agrees— 

(1) to provide the United States with timely access to the 

data produced, collected, or generated by the equipment; 

and 

(2) to permit the Secretary of Defense to take such measures as the Secretary considers necessary to inspect, test, 

maintain, repair, or replace that equipment, including access 

for purposes of such measures. 

(c) REPORT.—Promptly after entering into any agreement 

under subsection (b), the Secretary of Defense shall submit to Congress a report on the agreement. The report shall identify the country with which the agreement was made, the anticipated costs to 

the United States to be incurred under the agreement, and the national interest of the United States that is furthered by the agreement. 

(d) LIMITATION ON DELEGATION.—The Secretary of Defense 

may delegate the authority of the Secretary to carry out this section only to the Secretary of the Air Force. Such a delegation may 

be redelegated. 

(Added Pub. L. 106–398, Sec. 1 [[div. A], title XII, Sec. 1203(a)], Oct. 30, 2000, 114 Stat. 1654, 

1654A–324, Sec. 2555; renumbered Sec. 2565 and amended Pub. L. 107–107, title XII, Sec. 

1201(a)(1), (b), Dec. 28, 2001, 115 Stat. 1245.) 

§ 2566. Space and services: provision to military welfare societies 

(a) AUTHORITY TO PROVIDE SPACE AND SERVICES.—The Secretary of a military department may provide, without charge, space 

and services under the jurisdiction of that Secretary to a military 

welfare society. 

(b) DEFINITIONS.—In this section: 

(1) The term ‘‘military welfare society’’ means the following: 

(A) The Army Emergency Relief Society. 

(B) The Navy-Marine Corps Relief Society. 

(C) The Air Force Aid Society, Inc. 

(2) The term ‘‘services’’ includes lighting, heating, cooling, 

electricity, office furniture, office machines and equipment, 

telephone and other information technology services (including 

installation of lines and equipment, connectivity, and other associated services), and security systems (including installation 

and other associated expenses). 

(Added Pub. L. 107–314, div. A, title X, Sec. 1066(a), Dec. 2, 2002, 116 Stat. 2656.) 

[§ 2567. Repealed. Pub. L. 110–181, div. A, title X, Sec. 

1068(b)(1), Jan. 28, 2008, 122 Stat. 326] 

§ 2568. Retention of combat uniforms by members deployed 

in support of contingency operations 

The Secretary of a military department may authorize a member of the armed forces under the jurisdiction of the Secretary who 

has been deployed in support of a contingency operation for at least 
§ 2568 CH. 152—ISSUE OF SUPPLIES, SERVICES, AND FACILITIES 1464 

30 days to retain, after that member is no longer so deployed, the 

combat uniform issued to that member as organizational clothing 

and individual equipment. 

(Added Pub. L. 110–181, div. A, title III, Sec. 376(a), Jan. 28, 2008, 122 Stat. 84.) 
1465 

CHAPTER 153—EXCHANGE OF MATERIAL AND DISPOSAL 

OF OBSOLETE, SURPLUS, OR UNCLAIMED PROPERTY 

Sec. 

2571. Interchange of supplies and services. 

2572. Documents, historical artifacts, and condemned or obsolete combat materiel: loan, gift, or exchange. 

[2573. Repealed.] 

2574. Armament: sale of individual pieces. 

2575. Disposition of unclaimed property. 

2576. Surplus military equipment: sale to State and local law enforcement, firefighting, homeland security, and emergency management agencies. 

2576a. Excess personal property: sale or donation for law enforcement activities. 

2576b. Excess personal property: sale or donation to assist firefighting agencies. 

2577. Disposal of recyclable materials. 

2578. Vessels: transfer between departments. 

2579. War booty: procedures for handling and retaining battlefield objects. 

2580. Donation of excess chapel property. 

2581. Excess UH–1 Huey and AH–1 Cobra helicopters: requirements for transfer 

to foreign countries. 

2582. Military equipment identified on United States munitions list: annual report of public sales. 

2583. Military animals: transfer and adoption. 

§ 2571. Interchange of supplies and services 

(a) If either of the Secretaries concerned requests it and the 

other approves, supplies may be transferred, without compensation, 

from one armed force to another. 

(b) If its head approves, a department or organization within 

the Department of Defense may, upon request, perform work and 

services for, or furnish supplies to, any other of those departments 

or organizations, without reimbursement or transfer of funds. 

(c) If military or civilian personnel of a department or organization within the Department of Defense are assigned or detailed 

to another of those departments or organizations, and if the head 

of the department or organization to which they are transferred approves, their pay and allowances and the cost of transporting their 

dependents and household goods may be charged to an appropriation that is otherwise available for those purposes to that department or organization. 

(d) No agency or official of the executive branch of the Federal 

Government may establish any regulation, program, or policy or 

take any other action which precludes, directly or indirectly, the 

Secretaries concerned from exercising the authority provided in 

this section. 

(Aug. 10, 1956, ch. 1041, 70A Stat. 143; Pub. L. 85–861, Sec. 1(49), Sept. 2, 1958, 72 Stat. 1459; 

Pub. L. 99–167, title VIII, Sec. 821, Dec. 3, 1985, 99 Stat. 991; Pub. L. 109–364, div. B, title 

XXVIII, Sec. 2825(c)(1), (d)(1), Oct. 17, 2006, 120 Stat. 2477.) 
§ 2572 CH. 153—EXCHANGE OF MATERIAL & PROP. DISPOSAL 1466 

§ 2572. Documents, historical artifacts, and condemned or 

obsolete combat materiel: loan, gift, or exchange 

(a) The Secretary concerned may lend or give items described 

in subsection (c) that are not needed by the military department 

concerned (or by the Coast Guard, in the case of the Secretary of 

Homeland Security), to any of the following: 

(1) A municipal corporation, county, or other political subdivision of a State. 

(2) A servicemen’s monument association. 

(3) A museum, historical society, or historical institution of 

a State or a foreign nation or a nonprofit military aviation heritage foundation or association incorporated in a State. 

(4) An incorporated museum or memorial that is operated 

and maintained for educational purposes only and the charter 

of which denies it the right to operate for profit. 

(5) A post of the Veterans of Foreign Wars of the United 

States or of the American Legion or a unit of any other recognized war veterans’ association. 

(6) A local or national unit of any war veterans’ association 

of a foreign nation which is recognized by the national government of that nation (or by the government of one of the principal political subdivisions of that nation). 

(7) A post of the Sons of Veterans Reserve. 

(b)(1) Subject to paragraph (2), the Secretary concerned may 

exchange items described in subsection (c) that are not needed by 

the armed forces for any of the following items or services if such 

items or services directly benefit the historical collection of the 

armed forces: 

(A) Similar items held by any individual, organization, institution, agency, or nation. 

(B) Conservation supplies, equipment, facilities, or systems. 

(C) Search, salvage, or transportation services. 

(D) Restoration, conservation, or preservation services. 

(E) Educational programs. 

(2) The Secretary concerned may not make an exchange under 

paragraph (1) unless the monetary value of property transferred, or 

services provided, to the United States under the exchange is not 

less than the value of the property transferred by the United 

States. The Secretary concerned may waive the limitation in the 

preceding sentence in the case of an exchange of property for property in any case in which the Secretary determines that the item 

to be received by the United States in the exchange will significantly enhance the historical collection of the property administered by the Secretary. 

(c) This section applies to the following types of property held 

by a military department or the Coast Guard: books, manuscripts, 

works of art, historical artifacts, drawings, plans, models, and condemned or obsolete combat materiel. 

(d)(1) A loan or gift made under this section shall be subject 

to regulations prescribed by the Secretary concerned and to regulations under section 121 of title 40. The Secretary concerned shall 

ensure that an item authorized to be donated under this section is 
1467 § 2575 CH. 153—EXCHANGE OF MATERIAL & PROP. DISPOSAL 

demilitarized in the interest of public safety, as determined necessary by the Secretary or the Secretary’s delegee. 

(2)(A) Except as provided in subparagraph (B), the United 

States may not incur any expense in connection with a loan or gift 

under subsection (a), including any expense associated with demilitarizing an item under paragraph (1), for which the recipient of the 

item shall be responsible. 

(B) The Secretary concerned may, without cost to the recipient, 

demilitarize, prepare, and transport in the continental United 

States for donation to a recognized war veterans’ association an 

item authorized to be donated under this section if the Secretary 

determines the demilitarization, preparation, and transportation 

can be accomplished as a training mission without additional budgetary requirements for the unit involved. 

(Aug. 10, 1956, ch. 1041, 70A Stat. 143; Pub. L. 96–513, title V, Sec. 511(82), Dec. 12, 1980, 

94 Stat. 2927; Pub. L. 100–456, div. A, title III, Sec. 324(a), Sept. 29, 1988, 102 Stat. 1954; Pub. 

L. 101–510, div. A, title III, Sec. 325, Nov. 5, 1990, 104 Stat. 1531; Pub. L. 102–484, div. A, 

title III, Sec. 373, Oct. 23, 1992, 106 Stat. 2385; Pub. L. 103–337, div. A, title X, Sec. 1071, 

Oct. 5, 1994, 108 Stat. 2859; Pub. L. 104–106, div. A, title III, Sec. 372, Feb. 10, 1996, 110 Stat. 

280; Pub. L. 107–107, div. A, title X, Sec. 1043(d), Dec. 28, 2001, 115 Stat. 1219; Pub. L. 107– 

217, Sec. 3(b)(9), Aug. 21, 2002, 116 Stat. 1296; Pub. L. 107–296, title XVII, Sec. 1704(b)(1), Nov. 

25, 2002, 116 Stat. 2314; Pub. L. 107–314, div. A, title III, Sec. 369, Dec. 2, 2002, 116 Stat. 

2524; Pub. L. 110–417, [div. A], title III, Sec. 352, Oct. 14, 2008, 122 Stat. 4425.) 

[§ 2573. Repealed. Pub. L. 96–513, title V, Sec. 511(83)(A), 

Dec. 12, 1980, 94 Stat. 2927] 

§ 2574. Armament: sale of individual pieces 

A piece of armament that can be advantageously replaced, and 

that is not needed for its historical value, may be sold by the military department having jurisdiction over it for not less than cost, 

if the Secretary concerned considers that there are adequate sentimental reasons for the sale. 

(Aug. 10, 1956, ch. 1041, 70A Stat. 144.) 

§ 2575. Disposition of unclaimed property 

(a) The Secretary of any military department, and the Secretary of Homeland Security, under such regulations as they may 

respectively prescribe, may each by public or private sale or otherwise, dispose of all lost, abandoned, or unclaimed personal property 

that comes into the custody or control of the Secretary’s department, other than property subject to section 4712, 6522, or 9712 of 

this title or subject to subsection (c). However, property may not be 

disposed of until diligent effort has been made to find the owner 

(or the heirs, next of kin, or legal representative of the owner). The 

diligent effort to find the owner (or the heirs, next of kin, or legal 

representative of the owner) shall begin, to the maximum extent 

practicable, not later than seven days after the date on which the 

property comes into the custody or control of the Secretary. The period for which that effort is continued may not exceed 45 days. If 

the owner (or the heirs, next of kin, or legal representative of the 

owner) is determined but not found, the property may not be disposed of until the expiration of 45 days after the date when notice, 

giving the time and place of the intended sale or other disposition, 

has been sent by certified or registered mail to that person at his 

last known address. When diligent effort to determine the owner 
§ 2576 CH. 153—EXCHANGE OF MATERIAL & PROP. DISPOSAL 1468 

(or heirs, next of kin, or legal representative of the owner) is unsuccessful, the property may be disposed of without delay, except that 

if it has a fair market value of more than $300, the Secretary may 

not dispose of the property until 45 days after the date it is received at a storage point designated by the Secretary. 

(b)(1) In the case of lost, abandoned, or unclaimed personal 

property found on a military installation, the proceeds from the 

sale of the property under this section shall be credited to the operation and maintenance account of that installation and used— 

(A) to reimburse the installation for any costs incurred by 

the installation to collect, transport, store, protect, or sell the 

property; and 

(B) to the extent that the amount of the proceeds exceeds 

the amount necessary for reimbursing all such costs, to support 

morale, welfare, and recreation activities under the jurisdiction 

of the armed forces that are conducted for the comfort, pleasure, contentment, or physical or mental improvement of members of the armed forces at such installation. 

(2) The net proceeds from the sale of other property under this 

section shall be covered into the Treasury as miscellaneous receipts. 

(c) No property covered by this section may be delivered to the 

Armed Forces Retirement Home by the Secretary of a military department, except papers of value, sabers, insignia, decorations, 

medals, watches, trinkets, manuscripts, and other articles valuable 

chiefly as keepsakes. 

(d)(1) The owner (or heirs, next of kin, or legal representative 

of the owner) of personal property the proceeds of which are credited to a military installation under subsection (b)(1) may file a 

claim with the Secretary of Defense for the amount equal to the 

proceeds (less costs referred to in subparagraph (A) of such subsection). Amounts to pay the claim shall be drawn from the morale, 

welfare, and recreation account for the installation that received 

the proceeds. 

(2) The owner (or heirs, next of kin, or legal representative of 

the owner) may file a claim with the Secretary of Defense for proceeds covered into the Treasury under subsection (b)(2). 

(3) Unless a claim is filed under this subsection within 5 years 

after the date of the disposal of the property to which the claim relates, the claim may not be considered by a court, the Secretary of 

Defense (in the case of a claim filed under paragraph (1)), or the 

Secretary of Defense (in the case of a claim filed under paragraph 

(2)). 

(Aug. 10, 1956, ch. 1041, 70A Stat. 144; Pub. L. 89–143, Aug. 28, 1965, 79 Stat. 581; Pub. L. 

96–513, title V, Sec. 511(84), Dec. 12, 1980, 94 Stat. 2927; Pub. L. 101–189, div. A, title III, 

Sec. 322(a), (b), title XVI, Sec. 1622(f)(1), Nov. 29, 1989, 103 Stat. 1413, 1605; Pub. L. 101–510, 

div. A, title XV, Sec. 1533(a)(2), Nov. 5, 1990, 104 Stat. 1733; Pub. L. 104–106, div. A, title III, 

Sec. 374(a), Feb. 10, 1996, 110 Stat. 281; Pub. L. 104–316, title II, Sec. 202(d), Oct. 19, 1996, 

110 Stat. 3842; Pub. L. 107–296, title XVII, Sec. 1704(b)(1), Nov. 25, 2002, 116 Stat. 2314.) 

§ 2576. Surplus military equipment: sale to State and local 

law enforcement, firefighting, homeland security, 

and emergency management agencies 

(a) The Secretary of Defense, under regulations prescribed by 

him, may sell to State and local law enforcement, firefighting, 
1469 § 2576a CH. 153—EXCHANGE OF MATERIAL & PROP. DISPOSAL 

homeland security, and emergency management agencies, at fair 

market value, pistols, revolvers, shotguns, rifles of a caliber not exceeding .30, ammunition for such firearms, gas masks, personal 

protective equipment, and other appropriate equipment which (1) 

are suitable for use by such agencies in carrying out law enforcement, firefighting, homeland security, and emergency management 

activities, and (2) have been determined to be surplus property 

under subtitle I of title 40 and division C (except sections 3302, 

3501(b), 3509, 3906, 4710, and 4711) of subtitle I of title 41. 

(b) Such surplus military equipment shall not be sold under 

the provisions of this section to State or local law enforcement, firefighting, homeland security, or emergency management agency unless request therefor is made by such agency, in such form and 

manner as the Secretary of Defense shall prescribe, and such request, with respect to the type and amount of equipment so requested, is certified as being necessary and suitable for the operation of such agency by the Governor (or such State official as he 

may designate) of the State in which such agency is located. Equipment sold to a State or local law enforcement, firefighting, homeland security, or emergency management agency under this section 

shall not exceed, in quantity, the amount requested and certified 

for such agency and shall be for the exclusive use of such agency. 

Such equipment may not be sold, or otherwise transferred, by such 

agency to any individual or public or private organization or 

agency. 

(Added Pub. L. 90–500, title IV, Sec. 403(a) Sept. 20, 1968, 82 Stat. 851; amended Pub. L. 96– 

513, title V, Sec. 511(85), Dec. 12, 1980, 94 Stat. 2927; Pub. L. 107–217, Sec. 3(b)(10), Aug. 21, 

2002, 116 Stat. 1296; Pub. L. 111–350, Sec. 5(b)(42), Jan. 4, 2011, 124 Stat. 3846; Pub. L. 111– 

383, div. A, title X, Sec. 1072(a)–(c)(1), Jan. 7, 2011, 124 Stat. 4366.) 

§ 2576a. Excess personal property: sale or donation for law 

enforcement activities 

(a) TRANSFER AUTHORIZED.—(1) Notwithstanding any other 

provision of law and subject to subsection (b), the Secretary of Defense may transfer to Federal and State agencies personal property 

of the Department of Defense, including small arms and ammunition, that the Secretary determines is— 

(A) suitable for use by the agencies in law enforcement activities, including counter-drug and counter-terrorism activities; and 

(B) excess to the needs of the Department of Defense. 

(2) The Secretary shall carry out this section in consultation 

with the Attorney General and the Director of National Drug Control Policy. 

(b) CONDITIONS FOR TRANSFER.—The Secretary of Defense may 

transfer personal property under this section only if— 

(1) the property is drawn from existing stocks of the Department of Defense; 

(2) the recipient accepts the property on an as-is, whereis basis; 

(3) the transfer is made without the expenditure of any 

funds available to the Department of Defense for the procurement of defense equipment; and 

(4) all costs incurred subsequent to the transfer of the 

property are borne or reimbursed by the recipient. 
§ 2576b CH. 153—EXCHANGE OF MATERIAL & PROP. DISPOSAL 1470 

(c) CONSIDERATION.—Subject to subsection (b)(4), the Secretary 

may transfer personal property under this section without charge 

to the recipient agency. 

(d) PREFERENCE FOR CERTAIN TRANSFERS.—In considering applications for the transfer of personal property under this section, 

the Secretary shall give a preference to those applications indicating that the transferred property will be used in the counterdrug or counter-terrorism activities of the recipient agency. 

(Added Pub. L. 104–201, div. A, title X, Sec. 1033(a)(1), Sept. 23, 1996, 110 Stat. 2639.) 

§ 2576b. Excess personal property: sale or donation to assist 

firefighting agencies 

(a) TRANSFER AUTHORIZED.—Subject to subsection (b), the Secretary of Defense shall transfer to a firefighting agency in a State 

any personal property of the Department of Defense that the Secretary determines is— 

(1) excess to the needs of the Department of Defense; and 

(2) suitable for use in providing fire and emergency medical services, including personal protective equipment and 

equipment for communication and monitoring. 

(b) CONDITIONS FOR TRANSFER.—The Secretary of Defense shall 

transfer personal property under this section only if— 

(1) the property is drawn from existing stocks of the Department of Defense; 

(2) the recipient firefighting agency accepts the property 

on an as-is, where-is basis; 

(3) the transfer is made without the expenditure of any 

funds available to the Department of Defense for the procurement of defense equipment; and 

(4) all costs incurred subsequent to the transfer of the 

property are borne or reimbursed by the recipient. 

(c) CONSIDERATION.—Subject to subsection (b)(4), the Secretary 

may transfer personal property under this section without charge 

to the recipient firefighting agency. 

(d) DEFINITIONS.—In this section: 

(1) STATE.—The term ‘‘State’’ includes the District of Columbia, the Commonwealth of Puerto Rico, the Commonwealth 

of the Northern Mariana Islands, and any territory or possession of the United States. 

(2) FIREFIGHTING AGENCY.—The term ‘‘firefighting agency’’ 

means any volunteer, paid, or combined departments that provide fire and emergency medical services. 

(Added Pub. L. 106–398, Sec. 1 [[div. A], title XVII, Sec. 1706(a)], Oct. 30, 2000, 114 Stat. 1654, 

1654A–367; amended Pub. L. 108–375, div. A, title III, Sec. 354, Oct. 28, 2004, 118 Stat. 1861.) 

§ 2577. Disposal of recyclable materials 

(a)(1) The Secretary of Defense shall prescribe regulations to 

provide for the sale of recyclable materials held by a military department or defense agency and for the operation of recycling programs at military installations. Such regulations shall include procedures for the designation by the Secretary of a military department (or by the Secretary of Defense with respect to facilities of a 

defense agency) of military installations that have established a 

qualifying recycling program for the purposes of subsection (b)(2). 
1471 § 2579 CH. 153—EXCHANGE OF MATERIAL & PROP. DISPOSAL 

(2) Any sale of recyclable materials by the Secretary of Defense 

or Secretary of a military department shall be in accordance with 

the procedures in sections 541–555 of title 40 for the sale of surplus 

property. 

(b)(1) Proceeds from the sale of recyclable materials at an installation shall be credited to funds available for operations and 

maintenance at that installation in amounts sufficient to cover the 

costs of operations, maintenance, and overhead for processing recyclable materials at the installation (including the cost of any equipment purchased for recycling purposes). 

(2) If after such funds are credited a balance remains available 

to a military installation and such installation has a qualifying recycling program (as determined by the Secretary of the military department concerned or the Secretary of Defense), not more than 50 

percent of that balance may be used at the installation for projects 

for pollution abatement, energy conservation, and occupational 

safety and health activities. A project may not be carried out under 

the preceding sentence for an amount greater than 50 percent of 

the amount established by law as the maximum amount for a 

minor construction project. 

(3) The remaining balance available to a military installation 

may be transferred to the nonappropriated morale and welfare account of the installation to be used for any morale or welfare activity. 

(c) If the balance available to a military installation under this 

section at the end of any fiscal year is in excess of $2,000,000, the 

amount of that excess shall be covered into the Treasury as miscellaneous receipts. 

(Added Pub. L. 97–214, Sec. 6(b)(1), July 12, 1982, 96 Stat. 172; amended Pub. L. 98–525, title 

XIV, Sec. 1405(37), Oct. 19, 1984, 98 Stat. 2624; Pub. L. 107–217, Sec. 3(b)(11), Aug. 21, 2002, 

116 Stat. 1296.) 

§ 2578. Vessels: transfer between departments 

A vessel under the jurisdiction of a military department may 

be transferred or otherwise made available without reimbursement 

to another military department or to the Department of Homeland 

Security, and a vessel under the jurisdiction of the Department of 

Homeland Security may be transferred or otherwise made available 

without reimbursement to a military department. Any such transfer may be made only upon the request of the Secretary of the military department concerned or the Secretary of Homeland Security, 

as the case may be, and with the approval of the Secretary of the 

department having jurisdiction of the vessel. 

(Added Pub. L. 100–370, Sec. 1(k)(1), July 19, 1988, 102 Stat. 848; amended Pub. L. 107–296, 

title XVII, Sec. 1704(b)(1), Nov. 25, 2002, 116 Stat. 2314.) 

§ 2579. War booty: procedures for handling and retaining 

battlefield objects 

(a) POLICY.—The United States recognizes that battlefield souvenirs have traditionally provided military personnel with a valued 

memento of service in a national cause. At the same time, it is the 

policy and tradition of the United States that the desire for souvenirs in a combat theater not blemish the conduct of combat operations or result in the mistreatment of enemy personnel, the dis-
§ 2580 CH. 153—EXCHANGE OF MATERIAL & PROP. DISPOSAL 1472 

honoring of the dead, distraction from the conduct of operations, or 

other unbecoming activities. 

(b) REGULATIONS.—(1) The Secretary of Defense shall prescribe 

regulations for the handling of battlefield objects that are consistent with the policies expressed in subsection (a) and the requirements of this section. 

(2) When forces of the United States are operating in a theater 

of operations, enemy material captured or found abandoned shall 

be turned over to appropriate United States or allied military personnel except as otherwise provided in such regulations. A member 

of the armed forces (or other person under the authority of the 

armed forces in a theater of operations) may not (except in accordance with such regulations) take from a theater of operations as a 

souvenir an object formerly in the possession of the enemy. 

(3) Such regulations shall provide that a member of the armed 

forces who wishes to retain as a souvenir an object covered by 

paragraph (2) may so request at the time the object is turned over 

pursuant to paragraph (2). 

(4) Such regulations shall provide for an officer to be designated to review requests under paragraph (3). If the officer determines that the object may be appropriately retained as a war souvenir, the object shall be turned over to the member who requested 

the right to retain it. 

(5) Such regulations shall provide for captured weaponry to be 

retained as souvenirs, as follows: 

(A) The only weapons that may be retained are those in 

categories to be agreed upon jointly by the Secretary of Defense and the Secretary of the Treasury. 

(B) Before a weapon is turned over to a member, the weapon shall be rendered unserviceable. 

(C) A charge may be assessed in connection with each 

weapon in an amount sufficient to cover the full cost of rendering the weapon unserviceable. 

(Added Pub. L. 103–160, div. A, title XI, Sec. 1171(a)(1), Nov. 30, 1993, 107 Stat. 1765.) 

§ 2580. Donation of excess chapel property 

(a) AUTHORITY TO DONATE.—The Secretary of a military department may donate personal property specified in subsection (b) 

to an organization described in section 501(c)(3) of the Internal 

Revenue Code of 1986 that is a religious organization in order to 

assist the organization in restoring or replacing property of the organization that has been damaged or destroyed as a result of an 

act of arson or terrorism, as determined pursuant to procedures 

prescribed by the Secretary of Defense. 

(b) PROPERTY COVERED.—(1) The property authorized to be donated under subsection (a) is furniture and other personal property 

that— 

(A) is in, or was formerly in, a chapel under the jurisdiction of the Secretary of a military department and closed or 

being closed; and 

(B) is determined by the Secretary to be excess to the requirements of the armed forces. 

(2) No real property may be donated under this section. 
1473 § 2582 CH. 153—EXCHANGE OF MATERIAL & PROP. DISPOSAL 

(c) DONEES NOT TO BE CHARGED.—No charge may be imposed 

by the Secretary of a military department on a donee of property 

under this section in connection with the donation. However, the 

donee shall agree to defray any expense for shipping or other transportation of property donated under this section from the location 

of the property when donated to any other location. 

(Added Pub. L. 105–85, div. A, title X, Sec. 1063(a), Nov. 18, 1997, 111 Stat. 1892.) 

§ 2581. Excess UH–1 Huey and AH–1 Cobra helicopters: requirements for transfer to foreign countries 

(a) REQUIREMENTS.—(1) Before an excess UH–1 Huey helicopter or AH–1 Cobra helicopter is transferred on a grant or sales 

basis to a foreign country for the purpose of flight operations by 

that country, the Secretary of Defense shall make all reasonable efforts to ensure that the helicopter receives, to the extent necessary, 

maintenance and repair equivalent to the depot-level maintenance 

and repair (as defined in section 2460 of this title) that the helicopter would need were the helicopter to remain in operational use 

with the armed forces. Any such maintenance and repair work 

shall be performed at no cost to the Department of Defense. 

(2) The Secretary shall make all reasonable efforts to ensure 

that maintenance and repair work described in paragraph (1) is 

performed in the United States. 

(b) EXCEPTION.—Subsection (a) does not apply with respect to 

salvage helicopters provided to the foreign country solely as a 

source for spare parts. 

(Added Pub. L. 105–261, div. A, title XII, Sec. 1234(a), Oct. 17, 1998, 112 Stat. 2156.) 

§ 2582. Military equipment identified on United States munitions list: annual report of public sales 

(a) REPORT REQUIRED.—The Secretary of Defense shall prepare 

an annual report identifying each public sale conducted by a military department or Defense Agency of military items that are— 

(1) identified on the United States Munitions List maintained under section 121.1 of title 22, Code of Federal Regulations; and 

(2) assigned a demilitarization code of ‘‘B’’ or its equivalent. 

(b) ELEMENTS OF REPORT.—(1) A report under this section 

shall cover all public sales described in subsection (a) that were 

conducted during the preceding fiscal year. 

(2) The report shall specify the following for each sale: 

(A) The date of the sale. 

(B) The military department or Defense Agency conducting 

the sale. 

(C) The manner in which the sale was conducted. 

(D) The military items described in subsection (a) that 

were sold or offered for sale. 

(E) The purchaser of each item. 

(F) The stated end-use of each item sold. 

(c) SUBMISSION OF REPORT.—Not later than March 31 of each 

year, the Secretary of Defense shall submit to the Committee on 

Armed Services of the House of Representatives and the Committee 
§ 2583 CH. 153—EXCHANGE OF MATERIAL & PROP. DISPOSAL 1474 

on Armed Services of the Senate the report required by this section 

for the preceding fiscal year. 

(Added Pub. L. 106–398, Sec. 1 [[div. A], title III, Sec. 381(a)], Oct. 30, 2000, 114 Stat. 1654, 

1654A–84.) 

§ 2583. Military animals: transfer and adoption 

(a) AVAILABILITY FOR ADOPTION.—The Secretary of the military 

department concerned may make a military animal of such military department available for adoption by a person or entity referred to in subsection (c), unless the animal has been determined 

to be unsuitable for adoption under subsection (b), under circumstances as follows: 

(1) At the end of the animal’s useful life. 

(2) Before the end of the animal’s useful life, if such Secretary, in such Secretary’s discretion, determines that unusual 

or extraordinary circumstances justify making the animal 

available for adoption before that time. 

(3) When the animal is otherwise excess to the needs of 

such military department. 

(b) SUITABILITY FOR ADOPTION.—The decision whether a particular military animal is suitable or unsuitable for adoption under 

this section shall be made by the commander of the last unit to 

which the animal is assigned before being declared excess. The unit 

commander shall consider the recommendations of the unit’s veterinarian in making the decision regarding the adoptability of the animal. 

(c) AUTHORIZED RECIPIENTS.—Military animals may be adopted 

under this section by law enforcement agencies, former handlers of 

these animals, and other persons capable of humanely caring for 

these animals. 

(d) CONSIDERATION.—The transfer of a military animal under 

this section may be without charge to the recipient. 

(e) LIMITATIONS ON LIABILITY FOR TRANSFERRED ANIMALS.—(1) 

Notwithstanding any other provision of law, the United States 

shall not be subject to any suit, claim, demand or action, liability, 

judgment, cost, or other fee arising out of any claim for personal 

injury or property damage (including death, illness, or loss of or 

damage to property or other economic loss) that results from, or is 

in any manner predicated upon, the act or omission of a former 

military animal transferred under this section, including any training provided to the animal while a military animal. 

(2) Notwithstanding any other provision of law, the United 

States shall not be liable for any veterinary expense associated 

with a military animal transferred under this section for a condition of the military animal before transfer under this section, 

whether or not such condition is known at the time of transfer 

under this section. 

(f) ANNUAL REPORT.—The Secretary of Defense shall submit to 

Congress an annual report specifying the number of military animals adopted under this section during the preceding year, the 

number of these animals currently awaiting adoption, and the 

number of these animals euthanized during the preceding year. 

With respect to each euthanized military animal, the report shall 
1475 § 2583 CH. 153—EXCHANGE OF MATERIAL & PROP. DISPOSAL 

contain an explanation of the reasons why the animal was 

euthanized rather than retained for adoption under this section. 

(g) MILITARY ANIMAL DEFINED.—In this section, the term ‘‘military animal’’ means the following: 

(1) A military working dog. 

(2) A horse owned by the Department of Defense. 

(Added Pub. L. 106–446, Sec. 1(a), Nov. 6, 2000, 114 Stat. 1932, Sec. 2582; renumbered Sec. 

2583, Pub. L. 107–107, div. A, title X, Sec. 1048(a)(25), Dec. 28, 2001, 115 Stat. 1224; amended 

Pub. L. 109–163, div. A, title V, Sec. 599, Jan. 6, 2006, 119 Stat. 3284; Pub. L. 109–364, div. 

A, title III, Sec. 352(a), Oct. 17, 2006, 120 Stat. 2160; Pub. L. 110–181, div. A, title X, Sec. 

1063(a)(13), Jan. 28, 2008, 122 Stat. 322.) 
1476 

CHAPTER 155—ACCEPTANCE OF GIFTS AND SERVICES 

Sec. 

2601. General gift funds. 

2601a. Direct acceptance of gifts by members of the armed forces and Department 

of Defense and Coast Guard employees and their families. 

2602. American National Red Cross: cooperation and assistance. 

2603. Acceptance of fellowships, scholarships, or grants. 

2604. United Seamen’s Service: cooperation and assistance. 

2605. Acceptance of gifts for defense dependents’ schools. 

2606. Scouting: cooperation and assistance in foreign areas. 

2607. Acceptance of gifts for the Defense Intelligence College. 

2608. Acceptance of contributions for defense programs, projects, and activities; 

Defense Cooperation Account. 

[2609. Repealed.] 

2610. Competitions for excellence: acceptance of monetary awards. 

2611. Regional centers for security studies: acceptance of gifts and donations. 

2612. National Defense University: acceptance of gifts. 

2613. Acceptance of frequent traveler miles, credits, and tickets; use to facilitate 

rest and recuperation travel of deployed members and their families. 

2614. Emergency communications equipment: acceptance from local public safety 

agencies for temporary use related to disasters. 

§ 2601. General gift funds 

(a) GENERAL AUTHORITY TO ACCEPT GIFTS.—Subject to subsection (d)(2), the Secretary concerned may accept, hold, administer, and spend any gift, devise, or bequest of real property, personal property, or money made on the condition that the gift, devise, or bequest be used for the benefit, or in connection with, the 

establishment, operation, or maintenance, of a school, hospital, library, museum, cemetery, or other institution or organization 

under the jurisdiction of the Secretary. 

(b) ADDITIONAL AUTHORITY TO ACCEPT GIFTS TO BENEFIT CERTAIN MEMBERS, DEPENDENTS, AND CIVILIAN EMPLOYEES.—(1) Subject to subsection (d)(2), the Secretary concerned may accept, hold, 

administer, and spend any gift, devise, or bequest of real property, 

personal property, money, or services made on the condition that 

the gift, devise, or bequest be used for the benefit of— 

(A) members of the armed forces, including members performing full-time National Guard duty under section 502(f) of 

title 32, who incur a wound, injury, or illness while in the line 

of duty; 

(B) civilian employees of the Department of Defense who 

incur a wound, injury, or illness while in the line of duty; 

(C) dependents of such members or employees; and 

(D) survivors of such members or employees who are 

killed. 

(2) The Secretary concerned may not accept a gift of services 

from a foreign government or international organization under this 

subsection. A gift of real property, personal property, or money 

from a foreign government or international organization may be ac-
1477 § 2601 CH. 155—ACCEPTANCE OF GIFTS AND SERVICES 

cepted under this subsection only if the gift is not designated for 

a specific individual. 

(3) The Secretary of Defense shall prescribe regulations specifying the conditions that may be attached to a gift, devise, or bequest accepted under this subsection. 

(c) GIFT FUNDS.—Gifts and bequests of money, and the proceeds of the sale of property, received under subsection (a) or (b) 

shall be deposited in the Treasury in the following accounts: 

(1) The Department of the Army General Gift Fund, in the 

case of deposits made by the Secretary of the Army. 

(2) The Department of the Navy General Gift Fund, in the 

case of deposits made by the Secretary of the Navy. 

(3) The Department of the Air Force General Gift Fund, in 

the case of deposits made by the Secretary of the Air Force. 

(4) The Coast Guard General Gift Fund, in the case of deposits made by the Secretary of Homeland Security. 

(5) The Department of Defense General Gift Fund, in the 

case of deposits made by the Secretary of Defense. 

(d) USE OF GIFTS; PROHIBITIONS.—(1) Except as provided in 

paragraph (2), property and money accepted under subsection (a) 

or (b) may be used by the Secretary concerned, and services accepted under subsection (b) may be performed, without further specific 

authorization in law. 

(2) Property and money may not be accepted under subsection 

(a) and property, money, and services may not be accepted under 

subsection (b)— 

(A) if the use of the property or money or the performance 

of the services in connection with any program, project, or activity would result in the violation of any prohibition or limitation otherwise applicable to such program, project, or activity; 

(B) if the conditions attached to the property, money, or 

services are inconsistent with applicable law or regulations; 

(C) if the Secretary concerned determines that the use of 

the property or money or the performance of the services would 

reflect unfavorably on the ability of the Department of Defense 

or the Coast Guard, any employee of the Department or Coast 

Guard, or any member of the armed forces to carry out any responsibility or duty in a fair and objective manner; or 

(D) if the Secretary concerned determines that the use of 

the property or money or the performance of the services would 

compromise the integrity or appearance of integrity of any program of the Department of Defense or Coast Guard, or any individual involved in such a program. 

(3) The Secretary concerned may disburse funds deposited in 

a gift fund referred to in subsection (c) for the purposes specified 

in subsections (a) and (b), subject to the terms of the gift, devise, 

or bequest. 

(e) PAYMENT OF EXPENSES.—The Secretary concerned may pay 

all necessary expenses in connection with the conveyance or transfer of a gift, devise, or bequest accepted under this section. 

(f) TREATMENT OF GIFTS.—For the purposes of Federal income, 

estate, and gift taxes, any property or money accepted under subsection (a) and any property, money, or services accepted under 
§ 2601a CH. 155—ACCEPTANCE OF GIFTS AND SERVICES 1478 

subsection (b) shall be considered as a gift, devise, or bequest to or 

for the use of the United States. 

(g) MANAGEMENT OF FUNDS.—In the case of each gift fund referred to in subsection (c), the Secretary of the Treasury, upon the 

request of the Secretary concerned, may retain money, securities, 

and the proceeds of the sale of securities in the gift fund and may 

invest money and reinvest the proceeds of the sale of securities in 

the gift fund in securities of the United States or in securities guaranteed as to principal and interest by the United States. The interest and profits accruing from those securities shall be deposited to 

the credit of the gift fund and may be disbursed as provided in subsection (d). 

(h) COMPTROLLER GENERAL REVIEW.—The Comptroller General 

shall make periodic audits of gifts, devises, and bequests accepted 

under subsection (a) or (b) at such intervals as the Comptroller 

General determines to be warranted. The Comptroller General 

shall submit to Congress a report on the results of each such audit. 

(i) DEFINITIONS.—In this section: 

(1) The term ‘‘Secretary concerned’’ includes the Secretary 

of Defense. 

(2) The term ‘‘services’’ includes activities that benefit the 

morale, welfare, or recreation of members of the armed forces 

and their dependents or are related or incidental to the conveyance of a gift, devise, or bequest of real property or personal 

property under subsection (a) or (b). 

(Aug. 10, 1956, ch. 1041, 70A Stat. 144; Pub. L. 96–513, title V, Sec. 511(86), Dec. 12, 1980, 

94 Stat. 2927; Pub. L. 107–296, title XVII, Sec. 1704(b)(1), Nov. 25, 2002, 116 Stat. 2314; Pub. 

L. 109–163, div. A, title III, Sec. 374, Jan. 6, 2006, 119 Stat. 3211; Pub. L. 110–181, div. A, 

title V, Sec. 593(a), Jan. 28, 2008, 122 Stat. 138.) 

§ 2601a. Direct acceptance of gifts by members of the armed 

forces and Department of Defense and Coast 

Guard employees and their families 

(a) REGULATIONS GOVERNING ACCEPTANCE OF GIFTS.—(1) The 

Secretary of Defense (and the Secretary of Homeland Security in 

the case of the Coast Guard) shall issue regulations to provide that, 

subject to such limitations as may be specified in such regulations, 

the following individuals may accept gifts from nonprofit organizations, private parties, and other sources outside the Department of 

Defense or the Department of Homeland Security: 

(A) A member of the armed forces described in subsection 

(b). 

(B) A civilian employee of the Department of Defense or 

Coast Guard described in subsection (c). 

(C) The family members of such a member or employee. 

(D) Survivors of such a member or employee who is killed. 

(2) The regulations required by this subsection shall— 

(A) apply uniformly to all elements of the Department of 

Defense and, to the maximum extent feasible, to the Coast 

Guard; and 

(B) require review and approval by a designated agency 

ethics official before acceptance of a gift to ensure that acceptance of the gift complies with the Joint Ethics Regulation. 

(b) COVERED MEMBERS.—This section applies to a member of 

the armed forces who, while performing active duty, full-time Na-
1479 § 2603 CH. 155—ACCEPTANCE OF GIFTS AND SERVICES 

tional Guard duty, or inactive-duty training on or after September 

11, 2001, incurred an injury or illness— 

(1) as described in section 1413a(e)(2) of this title; or 

(2) under other circumstances determined by the Secretary 

concerned to warrant treatment analogous to members covered 

by paragraph (1). 

(c) COVERED EMPLOYEES.—This section applies to a civilian 

employee of the Department of Defense or Coast Guard who, while 

an employee on or after September 11, 2001, incurred an injury or 

illness under a circumstance described in paragraph (1) or (2) of 

subsection (c). 

(d) GIFTS FROM CERTAIN SOURCES PROHIBITED.—The regulations issued under subsection (a) may not authorize the acceptance 

of a gift from a foreign government or international organization or 

their agents. 

(Added Pub. L. 111–383, div. A, title V, Sec. 591(a), Jan. 7, 2011, 124 Stat. 4231.) 

§ 2602. American National Red Cross: cooperation and assistance 

(a) Whenever the President finds it necessary, he may accept 

the cooperation and assistance of the American National Red 

Cross, and employ it under the armed forces under regulations to 

be prescribed by the Secretary of Defense. 

(b) Personnel of the American National Red Cross who are performing duties in connection with its cooperation and assistance 

under subsection (a) may be furnished— 

(1) transportation, at the expense of the United States, 

while traveling to and from, and while performing, those duties, in the same manner as civilian employees of the armed 

forces; 

(2) meals and quarters, at their expense or at the expense 

of the American National Red Cross, except that where civilian 

employees of the armed forces are quartered without charge, 

employees of the American National Red Cross may also be 

quartered without charge; and 

(3) available office space, warehousing, wharfage, and 

means of communication, without charge. 

(c) No fee may be charged for a passport issued to an employee 

of the American National Red Cross for travel outside the United 

States to assume or perform duties under this section. 

(d) Supplies of the American National Red Cross, including 

gifts for the use of the armed forces, may be transported at the expense of the United States, if it is determined under regulations 

prescribed under subsection (a) that they are necessary to the cooperation and assistance accepted under this section. 

(e) For the purposes of this section, employees of the American 

National Red Cross may not be considered as employees of the 

United States. 

(Aug. 10, 1956, ch. 1041, 70A Stat. 145.) 

§ 2603. Acceptance of fellowships, scholarships, or grants 

(a) Notwithstanding any other provision of law, a fellowship, 

scholarship, or grant may, under regulations to be prescribed by 

the President or his designee, be made by a corporation, fund, foun-
§ 2604 CH. 155—ACCEPTANCE OF GIFTS AND SERVICES 1480 

dation, or educational institution that is organized and operated 

primarily for scientific, literary, or educational purposes to any 

member of the armed forces, and the benefits thereof may be accepted by him— 

(1) in recognition of outstanding performance in his field; 

(2) to undertake a project that may be of value to the 

United States; or 

(3) for development of his recognized potential for future 

career service. 

However, the benefits of such a fellowship, scholarship, or 

grant may be accepted by the member in addition to his pay and 

allowances only to the extent that those benefits would be conferred upon him if the education or training contemplated by that 

fellowship, scholarship, or grant were provided at the expense of 

the United States. In addition, if such a benefit, in cash or in kind, 

is for travel, subsistence, or other expenses, an appropriate reduction shall be made from any payment that is made for the same 

purpose to the member by the United States incident to his acceptance of the fellowship, scholarship, or grant. 

(b) Each member of the armed forces who accepts a fellowship, 

scholarship, or grant in accordance with subsection (a) shall, before 

he is permitted to undertake the education or training contemplated by that fellowship, scholarship, or grant, agree in writing that, after he completes the education or training, he will serve 

on active duty for a period at least three times the length of the 

period of the education or training. 

(Added Pub. L. 87–555, Sec. 1(1), July 27, 1962, 76 Stat. 244; amended Pub. L. 111–383, div. 

A, title X, Sec. 1075(b)(39), Jan. 7, 2011, 124 Stat. 4371.) 

§ 2604. United Seamen’s Service: cooperation and assistance 

(a) Whenever the President finds it necessary in the interest 

of United States commitments abroad to provide facilities and services for United States merchant seamen in foreign areas, he may 

authorize the Secretary of Defense, under such regulations as the 

Secretary may prescribe, to cooperate with and assist the United 

Seamen’s Service in establishing and providing those facilities and 

services. 

(b) Personnel of the United Seamen’s Service who are performing duties in connection with the cooperation and assistance 

under subsection (a) may be furnished— 

(1) transportation, at the expense of the United States, 

while traveling to and from, and while performing those duties, 

in the same manner as civilian employees of the armed forces; 

(2) meals and quarters, at their expense or at the expense 

of the United Seamen’s Service, except that where civilian employees of the armed forces are quartered without charge, employees of the United Seamen’s Service may also be quartered 

without charge; and 

(3) available office space (including space for recreational 

activities for seamen), warehousing, wharfage, and means of 

communication, without charge. 

(c) No fee may be charged for a passport issued to an employee 

of the United Seamen’s Service for travel outside the United States 

to assume or perform duties under this section. 
1481 § 2605 CH. 155—ACCEPTANCE OF GIFTS AND SERVICES 

(d) Supplies of the United Seamen’s Service, including gifts for 

the use of merchant seamen, may be transported at the expense of 

the United States, if it is determined under regulations prescribed 

under subsection (a) that they are necessary to the cooperation and 

assistance provided under this section. 

(e) Where practicable, the President shall also make arrangements to provide for convertibility of local currencies for the United 

Seamen’s Service, in connection with its activities under subsection 

(a). 

(f) For the purposes of this section, employees of the United 

Seamen’s Service may not be considered as employees of the 

United States. 

(Added Pub. L. 91–603, Sec. 3(1), Dec. 31, 1970, 84 Stat. 1674.) 

§ 2605. Acceptance of gifts for defense dependents’ schools 

(a) The Secretary of Defense may accept, hold, administer, and 

spend any gift (including any gift of an interest in real property) 

made on the condition that it be used in connection with the operation or administration of a defense dependents’ school. The Secretary may pay all necessary expenses in connection with the acceptance of a gift under this subsection. 

(b) There is established in the Treasury a fund to be known as 

the ‘‘Department of Defense Dependents’ Education Gift Fund’’. 

Gifts of money, and the proceeds of the sale of property, received 

under subsection (a) shall be deposited in the fund. The Secretary 

may disburse funds deposited under this subsection for the benefit 

or use of defense dependents’ schools, subject to the terms of the 

gift. 

(c) Subsection (c) of section 2601 of this title applies to property that is accepted under subsection (a) in the same manner that 

such subsection applies to property that is accepted under subsection (a) of that section. 

(d)(1) Upon request of the Secretary of Defense, the Secretary 

of the Treasury may— 

(A) retain money, securities, and the proceeds of the sale 

of securities, in the Department of Defense Dependents’ Education Gift Fund; and 

(B) invest money and reinvest the proceeds of the sale of 

securities in that fund in securities of the United States or in 

securities guaranteed as to principal and interest by the 

United States. 

(2) The interest and profits accruing from those securities shall 

be deposited to the credit of the fund and may be disbursed as provided in subsection (b). 

(e) In this section, the term ‘‘gift’’ includes a devise of real 

property or a bequest of personal property. 

(f) The Secretary of Defense shall prescribe regulations to carry 

out this section. 

(g) In this section, the term ‘‘defense dependents’ school’’ 

means the following: 

(1) A school established as part of the defense dependents’ 

education system provided for under the Defense Dependents’ 

Education Act of 1978 (20 U.S.C. 921 et seq.). 
§ 2606 CH. 155—ACCEPTANCE OF GIFTS AND SERVICES 1482 

(2) An elementary or secondary school established pursuant to section 2164 of this title. 

(Added Pub. L. 99–661, div. A, title III, Sec. 314(a), Nov. 14, 1986, 100 Stat. 3853; amended 

Pub. L. 103–337, div. A, title III, Sec. 353(a)–(c)(1), Oct. 5, 1994, 108 Stat. 2731.) 

§ 2606. Scouting: cooperation and assistance in foreign 

areas 

(a) Subject to subsection (b), the Secretary concerned may cooperate with and assist qualified scouting organizations in establishing and providing facilities and services for members of the 

armed forces and their dependents, and civilian employees of the 

Department of Defense and their dependents, at locations outside 

the United States. 

(b) Cooperation and assistance under subsection (a) shall be 

provided under regulations prescribed by the Secretary of Defense 

and may be provided only if the President determines that such cooperation and assistance is necessary in the interest of the morale, 

welfare, and recreation of members of the armed forces. 

(c) Personnel of a qualified scouting organization, including officials certified by that organization as representing that organization, who are performing duties in connection with cooperation and 

assistance provided under subsection (a) may be furnished— 

(1) transportation at the expense of the United States 

while traveling to and from, and while performing, such duties 

in the same manner as civilian employees of the United States; 

and 

(2) available office space (including space for recreational 

activities for Boy Scouts and Girl Scouts), warehousing, utilities, and a means of communication, without charge. 

(d) Supplies of a qualified scouting organization may be transported at the expense of the United States if the Secretary concerned determines, under regulations prescribed under subsection 

(b), that the supplies are necessary to the cooperation and assistance provided under this section. 

(e) The Secretary concerned may reimburse a qualified scouting organization for all or part of the pay of an employee of that 

organization for any period during which the employee was performing services under subsection (a). Any such reimbursement 

may not be made from appropriated funds and shall be made under 

regulations prescribed under subsection (b). 

(f) For the purposes of this section, employees of a qualified 

scouting organization performing services under subsection (a) may 

not be considered to be employees of the United States. 

(g) In this section, the term ‘‘qualified scouting organization’’ 

means the Girl Scouts of the United States of America and the Boy 

Scouts of America. 

(Added Pub. L. 100–456, div. A, title III, Sec. 323(a), Sept. 29, 1988, 102 Stat. 1953.) 

§ 2607. Acceptance of gifts for the Defense Intelligence College 

(a) The Secretary of Defense may accept, hold, administer, and 

use any gift (including any gift of an interest in real property) 

made for the purpose of aiding and facilitating the work of the De-
1483 § 2608 CH. 155—ACCEPTANCE OF GIFTS AND SERVICES 

fense Intelligence College and may pay all necessary expenses in 

connection with the acceptance of such a gift. 

(b) Money, and proceeds from the sale of property, received as 

a gift under subsection (a) shall be deposited in the Treasury and 

shall be available for disbursement upon the order of the Secretary 

of Defense to the extent provided in annual appropriation Acts. 

(c) Subsection (c) of section 2601 of this title applies to property that is accepted under subsection (a) in the same manner that 

such subsection applies to property that is accepted under subsection (a) of that section. 

(d) In this section, the term ‘‘gift’’ includes a bequest of personal property or a devise of real property. 

(Added Pub. L. 101–193, title V, Sec. 502(a), Nov. 30, 1989, 103 Stat. 1708.) 

§ 2608. Acceptance of contributions for defense programs, 

projects, and activities; Defense Cooperation Account 

(a) ACCEPTANCE AUTHORITY.—The Secretary of Defense may 

accept from any person, foreign government, or international organization any contribution of money or real or personal property 

made by such person, foreign government, or international organization for use by the Department of Defense and may accept from 

any foreign government or international organization any contribution of services made by such foreign government or international 

organization for use by the Department of Defense. 

(b) ESTABLISHMENT OF DEFENSE COOPERATION ACCOUNT.—(1) 

There is established in the Treasury of the United States a special 

account to be known as the ‘‘Defense Cooperation Account’’. 

(2) Contributions of money and proceeds from the sale of any 

property accepted by the Secretary of Defense under subsection (a) 

shall be credited to the Defense Cooperation Account. 

(c) USE OF THE DEFENSE COOPERATION ACCOUNT.—(1) Funds 

in the Defense Cooperation Account may be appropriated for a 

function described in section 114 of this title only to the extent that 

the appropriation of such funds for such purpose is authorized in 

accordance with that section. 

(2) Funds in the Defense Cooperation Account shall not be 

made available for obligation or expenditure except to the extent 

and in the manner provided in subsequent appropriations Acts. 

(d) USE OF PROPERTY.—Any contribution of property received 

under this section may be— 

(1) retained and used by the Department of Defense in the 

form in which it was donated; 

(2) sold or otherwise disposed of upon such terms and conditions and in accordance with such procedures as the Secretary determines appropriate; or 

(3) converted into a form usable by the Department of Defense. 

(e) REPORTING REQUIREMENT.—(1) Not later than 30 days after 

the end of each quarter of each fiscal year, the Secretary of Defense 

shall submit to Congress a report on contributions of property accepted by the Secretary under this section during the preceding 

quarter. The Secretary shall include in each such report a description of all property having a value of more than $1,000,000. 
[§ 2609 CH. 155—ACCEPTANCE OF GIFTS AND SERVICES 1484 

(2) In computing the value of any property referred to in paragraph (1), the Secretary shall aggregate the value of— 

(A) similar items of property accepted by the Secretary 

during the quarter concerned; and 

(B) components which, if assembled, would comprise all or 

a substantial part of an item of equipment or a facility. 

(f) AUTHORITY TO USE PROPERTY.—Property accepted under 

subsection (a) may be used by the Secretary of Defense without 

specific authorization, except that such property may not be used 

in connection with any program, project, or activity if the use of 

such property would result in the violation of any prohibition or 

limitation otherwise applicable to such program, project, or activity. 

(g) INVESTMENT OF MONEY.—(1) Upon request by the Secretary 

of Defense, the Secretary of the Treasury may invest money in the 

Defense Cooperation Account in securities of the United States or 

in securities guaranteed as to principal and interest by the United 

States. 

(2) Any interest or other income that accrues from investment 

in securities referred to in paragraph (1) shall be deposited to the 

credit of the Defense Cooperation Account. 

(h) NOTIFICATION OF CONDITIONS.—The Secretary of Defense 

shall notify Congress of any condition imposed by the donor on the 

use of any contribution accepted by the Secretary under the authority of this section. 

(i) PERIODIC AUDITS BY GAO.—The Comptroller General of the 

United States shall make periodic audits of money and property accepted under this section, at such intervals as the Comptroller 

General determines to be warranted. The Comptroller General 

shall submit to Congress a report on the results of each such audit. 

(j) ITEMS INCLUDED AS CONTRIBUTIONS.—In this section, the 

term ‘‘contribution’’ includes a devise of real property or a bequest 

of personal property. 

(k) REGULATIONS.—The Secretary of Defense shall prescribe 

regulations to carry out this section. 

(Added Pub. L. 101–403, title II, Sec. 202(a)(1), Oct. 1, 1990, 104 Stat. 872; amended Pub. L. 

102–190, div. A, title X, Sec. 1061(a)(16), Dec. 5, 1991, 105 Stat. 1473; Pub. L. 103–160, div. 

A, title XI, Sec. 1105(b)(1), (2), Nov. 30, 1993, 107 Stat. 1750; Pub. L. 104–201, div. A, title X, 

Sec. 1063, Sept. 23, 1996, 110 Stat. 2652.) 

[§ 2609. Repealed. Pub. L. 104–106, div. A, title II, Sec. 253(9), 

Feb. 10, 1996, 110 Stat. 235] 

§ 2610. Competitions for excellence: acceptance of monetary 

awards 

(a) ACCEPTANCE AUTHORIZED.—The Secretary of Defense may 

accept a monetary award given to the Department of Defense by 

a nongovernmental entity as a result of the participation of the Department in a competition carried out to recognize excellence or innovation in providing services or administering programs. 

(b) DISPOSITION OF AWARDS.—A monetary award accepted 

under subsection (a) shall be credited to one or more nonappropriated fund accounts supporting morale, welfare, and recreation activities for the command, installation, or other activity that 
1485 § 2611 CH. 155—ACCEPTANCE OF GIFTS AND SERVICES 

is recognized for the award. Amounts so credited may be expended 

only for such activities. 

(c) INCIDENTAL EXPENSES.—Subject to such limitations as may 

be provided in appropriation Acts, appropriations available to the 

Department of Defense may be used to pay incidental expenses incurred by the Department to participate in a competition described 

in subsection (a) or to accept a monetary award under this section. 

(d) REGULATIONS AND REPORTING.—(1) The Secretary shall prescribe regulations to determine the disposition of monetary awards 

accepted under this section and the payment of incidental expenses 

under subsection (c). 

(2) At the end of each year, the Secretary shall submit to Congress a report for that year describing the disposition of monetary 

awards accepted under this section and the payment of incidental 

expenses under subsection (c). 

(e) TERMINATION.—The authority of the Secretary under this 

section shall expire on February 10, 1998. 

(Added Pub. L. 104–106, div. A, title III, Sec. 377(a), Feb. 10, 1996, 110 Stat. 283; amended 

Pub. L. 104–201, div. A, title X, Sec. 1074(a)(16), Sept. 23, 1996, 110 Stat. 2659.) 

§ 2611. Regional centers for security studies: acceptance of 

gifts and donations 

(a) AUTHORITY TO ACCEPT GIFTS AND DONATIONS.—(1) Subject 

to subsection (c), the Secretary of Defense may, on behalf of any 

Department of Defense regional center for security studies, any 

combination of such centers, or such centers generally, accept from 

any source specified in subsection (b) any gift or donation for purposes of defraying the costs or enhancing the operation of such a 

center, combination of centers, or centers generally, as the case 

may be. 

(2) For purposes of this section, the Department of Defense regional centers for security studies are the following: 

(A) The George C. Marshall European Center for Security 

Studies. 

(B) The Asia-Pacific Center for Security Studies. 

(C) The Center for Hemispheric Defense Studies. 

(D) The Africa Center for Strategic Studies. 

(E) The Near East South Asia Center for Strategic Studies. 

(b) SOURCES.—The sources from which gifts and donations may 

be accepted under subsection (a) are the following: 

(1) The government of a State or a political subdivision of 

a State. 

(2) The government of a foreign country. 

(3) A foundation or other charitable organization, including 

a foundation or charitable organization this is organized or operates under the laws of a foreign country. 

(4) Any source in the private sector of the United States 

or a foreign country. 

(c) LIMITATION.—The Secretary may not accept a gift or donation under subsection (a) if acceptance of the gift or donation would 

compromise or appear to compromise— 

(1) the ability of the Department of Defense, any employee 

of the Department, or any member of the armed forces to carry 
§ 2612 CH. 155—ACCEPTANCE OF GIFTS AND SERVICES 1486 

out the responsibility or duty of the Department in a fair and 

objective manner; or 

(2) the integrity of any program of the Department, or of 

any person involved in such a program. 

(d) CRITERIA FOR ACCEPTANCE.—The Secretary shall prescribe 

written guidance setting forth the criteria to be used in determining whether the acceptance of a gift or donation would have a 

result described in subsection (c). 

(e) CREDITING OF FUNDS.—Funds accepted by the Secretary 

under section (a) shall be credited to appropriations available to 

the Department of Defense for the regional center, combination of 

centers, or centers generally for which accepted. Funds so credited 

shall be merged with the appropriations to which credited and 

shall be available for the regional center, combination of centers, 

or centers generally, as the case may be, for the same purposes as 

the appropriations with which merged. Any funds accepted under 

this section shall remain available until expended. 

(f) GIFT OR DONATION DEFINED.—In this section, the term ‘‘gift 

or donation’’ means any gift or donation of funds, materials (including research materials), real or personal property, or services (including lecture services and faculty services). 

(Added Pub. L. 106–65, div. A, title IX, Sec. 915(a), Oct. 5, 1995, 113 Stat. 721; amended Pub. 

L. 107–314, div. A, title X, Sec. 1041(a)(17), Dec. 2, 2002, 116 Stat. 2645; Pub. L. 108–136, div. 

A, title IX, Sec. 931(a), (b)(1), (c), Nov. 24, 2003, 117 Stat. 1580, 1581; Pub. L. 108–375, div. 

A, title X, Sec. 1084(f)(2), Oct. 28, 2004, 118 Stat. 2064; Pub. L. 109–163, div. A, title IX, Sec. 

903(a)(1), Jan. 6, 2006, 119 Stat. 3397.) 

§ 2612. National Defense University: acceptance of gifts 

(a) The Secretary of Defense may accept, hold, administer, and 

spend any gift, including a gift from an international organization 

and a foreign gift or donation (as defined in section 2166(f)(4) of 

this title), that is made on the condition that it be used in connection with the operation or administration of the National Defense 

University. The Secretary may pay all necessary expenses in connection with the acceptance of a gift under this subsection. 

(b) There is established in the Treasury a fund to be known as 

the ‘‘National Defense University Gift Fund’’. Gifts of money, and 

the proceeds of the sale of property, received under subsection (a) 

shall be deposited in the fund. The Secretary may disburse funds 

deposited under this subsection for the benefit or use of the National Defense University. 

(c) Subsection (c) of section 2601 of this title applies to property that is accepted under subsection (a) in the same manner that 

such subsection applies to property that is accepted under subsection (a) of that section. 

(d)(1) Upon request of the Secretary of Defense, the Secretary 

of the Treasury may— 

(A) retain money, securities, and the proceeds of the sale 

of securities, in the National Defense University Gift Fund; 

and 

(B) invest money and reinvest the proceeds of the sale of 

securities in that fund in securities of the United States or in 

securities guaranteed as to principal and interest by the 

United States. 
1487 § 2613 CH. 155—ACCEPTANCE OF GIFTS AND SERVICES 

(2) The interest and profits accruing from those securities shall 

be deposited to the credit of the fund and may be disbursed as provided in subsection (b). 

(e) In this section: 

(1) the term ‘‘gift’’ includes a devise of real property or a 

bequest of personal property and any gift of an interest in real 

property. 

(2) The term ‘‘National Defense University’’ includes any 

school or other component of the National Defense University 

specified under section 2165(b) of this title. 

(f) The Secretary of Defense shall prescribe regulations to carry 

out this section. 

(Added Pub. L. 107–314, div. A, title IX, Sec. 931(a), Dec. 2, 2002, 116 Stat. 2624; amended Pub. 

L. 108–136, div. A, title IX, Sec. 931(d), Nov. 24, 2003, 117 Stat. 1581.) 

§ 2613. Acceptance of frequent traveler miles, credits, and 

tickets; use to facilitate rest and recuperation travel of deployed members and their families 

(a) AUTHORITY TO ACCEPT DONATION OF TRAVEL BENEFITS.— 

Subject to subsection (c), the Secretary of Defense may accept from 

any person or government agency the donation of travel benefits 

for the purposes of use under subsection (d). 

(b) TRAVEL BENEFIT DEFINED.—In this section, the term ‘‘travel benefit’’ means frequent traveler miles, credits for tickets, or 

tickets for air or surface transportation issued by an air carrier or 

a surface carrier, respectively, that serves the public. 

(c) CONDITION ON AUTHORITY TO ACCEPT DONATION.—The Secretary may accept a donation of a travel benefit under this section 

only if the air or surface carrier that is the source of the benefit 

consents to such donation. Any such donation shall be under such 

terms and conditions as the surface carrier may specify, and the 

travel benefit so donated may be used only in accordance with the 

rules established by the carrier. 

(d) USE OF DONATED TRAVEL BENEFITS.—A travel benefit accepted under this section may be used only for the purpose of— 

(1) facilitating the travel of a member of the armed forces 

who— 

(A) is deployed on active duty outside the United 

States away from the permanent duty station of the member in support of a contingency operation; and 

(B) is granted, during such deployment, rest and recuperative leave, emergency leave, convalescent leave, or another form of leave authorized for the member; or 

(2) in the case of a member of the armed forces 

recuperating from an injury or illness incurred or aggravated 

in the line of duty during such a deployment, facilitating the 

travel of family members of the member in order to be reunited 

with the member. 

(e) ADMINISTRATION.—(1) The Secretary shall designate a single office in the Department of Defense to carry out this section. 

That office shall develop rules and procedures to facilitate the acceptance and distribution of travel benefits under this section. 
§ 2614 CH. 155—ACCEPTANCE OF GIFTS AND SERVICES 1488 

(2) For the use of travel benefits under subsection (d)(2) by 

family members of a member of the armed forces, the Secretary 

may, as the Secretary determines appropriate, limit— 

(A) eligibility to family members who, by reason of affinity, 

degree of consanguinity, or otherwise, are sufficiently close in 

relationship to the member of the armed forces to justify the 

travel assistance; 

(B) the number of family members who may travel; and 

(C) the number of trips that family members may take. 

(3) The Secretary of Defense may, in an exceptional case, authorize a person not described in subsection (d)(2) to use a travel 

benefit accepted under this subsection to visit a member of the 

armed forces described in subsection (d)(1) if that person has a notably close relationship with the member. The travel benefit may 

be used by such person only in accordance with such conditions and 

restrictions as the Secretary determines appropriate and the rules 

established by the air carrier or surface carrier that is the source 

of the travel benefit. 

(f) SERVICES OF NONPROFIT ORGANIZATION.—The Secretary of 

Defense may enter into an agreement with a nonprofit organization 

to use the services of the organization— 

(1) to promote the donation of travel benefits under this 

section, except that amounts appropriated to the Department 

of Defense may not be expended for this purpose; and 

(2) to assist in administering the collection, distribution, 

and use of travel benefits under this section. 

(g) FAMILY MEMBER DEFINED.—In this section, the term ‘‘family member’’ has the meaning given that term in section 411h(b)(1) 

of title 37. 

(Added Pub. L. 108–375, div. A, title V, Sec. 585(a)(1), Oct. 28, 2004, 118 Stat. 1930; amended 

Pub. L. 109–364, div. A, title X, Sec. 1071(a)(20), Oct. 17, 2006, 120 Stat. 2399.) 

§ 2614. Emergency communications equipment: acceptance 

from local public safety agencies for temporary use 

related to disasters 

(a) AUTHORITY TO ACCEPT EQUIPMENT.—(1) Subject to subsection (c), the Secretary concerned— 

(1) may accept communications equipment for use in coordinating joint response and recovery operations with public 

safety agencies in the event of a disaster; and 

(2) may accept services related to the operation and maintenance of such equipment. 

(b) REGULATIONS.—The authority under subsection (a) shall be 

exercised under regulations prescribed by the Secretary of Defense. 

(c) LIMITATIONS.—(1) Equipment may be accepted under subsection (a)(1) only to the extent that communications equipment 

under the control of the Secretary concerned at the potential disaster response site is inadequate to meet military requirements for 

communicating with public safety agencies during the period of response to the disaster. 

(2) Services may be accepted under subsection (a)(2) related to 

the operation and maintenance of communications equipment only 

to the extent that the necessary capabilities are not available to the 

military commander having custody of the equipment. 
1489 § 2614 CH. 155—ACCEPTANCE OF GIFTS AND SERVICES 

(d) LIABILITY.—A person providing services accepted under this 

section may not be considered, by reason of the provision of such 

services, to be an officer, employee, or agent of the United States 

for any purpose. 

(Added Pub. L. 108–375, div. A, title X, Sec. 1051(a), Oct. 28, 2004, 118 Stat. 2054, Sec. 2613; 

renumbered Sec. 2614 and amended Pub. L. 109–364, div. A, title X, Sec. 1071(a)(19)(A), Oct. 

17, 2006, 120 Stat. 2399.) 
1490 

CHAPTER 157—TRANSPORTATION 

Sec. 

2631. Supplies: preference to United States vessels. 

2631a. Contingency planning: sealift and related intermodal transportation requirements. 

2632. Transportation to and from certain places of employment and on military 

installations. 

2633. Stevedoring and terminal services: vessels carrying cargo or passengers 

sponsored by military department. 

2634. Motor vehicles: transportation or storage for members on change of permanent station or extended deployment. 

2635. Medical emergency helicopter transportation assistance and limitation of 

individual liability. 

2636. Deductions from amounts due carriers. 

2636a. Loss or damage to personal property transported at Government expense: 

full replacement value; deduction from amounts due carriers. 

2637. Transportation in certain areas outside the United States. 

2638. Transportation of civilian clothing of enlisted members. 

2639. Transportation to and from school for certain minor dependents. 

2640. Charter air transportation of members of the armed forces. 

2641. Transportation of certain veterans on Department of Defense aeromedical 

evacuation aircraft. 

2641a. Transportation of American Samoa veterans on Department of Defense 

aircraft for certain medical care in Hawaii. 

2641b. Space-available travel on Department of Defense aircraft: retired members 

residing in Commonwealths and possessions of the United States for 

certain health care services. 

2642. Airlift services provided to certain other agencies: use of Department of 

Defense reimbursement rate. 

2643. Commissary and exchange services: transportation overseas. 

2644. Control of transportation systems in time of war. 

2645. Indemnification of Department of Transportation for losses covered by vessel war risk insurance. 

2646. Travel services: procurement for official and unofficial travel under one 

contract. 

2647. Next-of-kin of persons unaccounted for from conflicts after World War II: 

transportation to annual meetings. 

2648. Persons and supplies: sea, land, and air transportation. 

2649. Civilian passengers and commercial cargoes: transportation on Department of Defense vessels, vehicles, and aircraft. 

2650. Civilian personnel in Alaska. 

2651. Passengers and merchandise to Guam: sea transport. 

§ 2631. Supplies: preference to United States vessels 

(a) Only vessels of the United States or belonging to the 

United States may be used in the transportation by sea of supplies 

bought for the Army, Navy, Air Force, or Marine Corps. However, 

if the President finds that the freight charged by those vessels is 

excessive or otherwise unreasonable, contracts for transportation 

may be made as otherwise provided by law. Charges made for the 

transportation of those supplies by those vessels may not be higher 

than the charges made for transporting like goods for private persons. 

(b)(1) In each request for proposals to enter into a time-charter 

contract for the use of a vessel for the transportation of supplies 
1491 § 2632 CH. 157—TRANSPORTATION 

under this section, the Secretary of Defense shall require that any 

reflagging or repair work on a vessel for which a proposal is submitted in response to the request for proposals be performed in the 

United States (including any territory of the United States). 

(2) In paragraph (1), the term ‘‘reflagging or repair work’’ 

means work performed on a vessel— 

(A) to enable the vessel to meet applicable standards to become a vessel of the United States; or 

(B) to convert the vessel to a more useful military configuration. 

(3) The Secretary of Defense may waive the requirement described in paragraph (1) if the Secretary determines that such 

waiver is critical to the national security of the United States. The 

Secretary shall immediately notify the Congress of any such waiver 

and the reasons for such waiver. 

(Aug. 10, 1956, ch. 1041, 70A Stat. 146; Pub. L. 103–160, div. A, title III, Sec. 315(a), Nov. 30, 

1993, 107 Stat. 1619.) 

§ 2631a. Contingency planning: sealift and related intermodal transportation requirements 

(a) CONSIDERATION OF PRIVATE CAPABILITIES.—The Secretary 

of Defense shall ensure that all studies and reports of the Department of Defense, and all actions taken in the Department of Defense, concerning sealift and related intermodal transportation requirements take into consideration the full range of the transportation and distribution capabilities that are available from operators of privately owned United States flag merchant vessels. 

(b) PRIVATE CAPACITIES PRESENTATIONS.—The Secretary shall 

afford each operator of a vessel referred to in subsection (a), not 

less often than annually, an opportunity to present to the Department of Defense information on its port-to-port and intermodal 

transportation capacities. 

(Added Pub. L. 103–160, div. A, title XI, Sec. 1173(a), Nov. 30, 1993, 107 Stat. 1767.) 

§ 2632. Transportation to and from certain places of employment and on military installations 

(a)(1) Whenever the Secretary of the military department concerned determines that it is necessary for the effective conduct of 

the affairs of his department, the Secretary may provide the transportation described in paragraph (2). 

(2) Transportation that may be provided under this subsection 

is assured and adequate transportation by motor vehicle or water 

carrier as follows: 

(A) Transportation among places on a military installation 

(including any subinstallation of a military installation). 

(B) Transportation to and from their places of duty or employment on a military installation for persons covered by this 

subsection. 

(C) Transportation to and from a military installation for 

persons covered by this subsection and their dependents, in the 

case of a military installation located in an area determined by 

the Secretary concerned not to be adequately served by regularly scheduled, and timely, commercial or municipal mass 

transit services. 
§ 2632 CH. 157—TRANSPORTATION 1492 

(D) Transportation to and from their places of employment 

for persons attached to, or employed in, a private plant that is 

manufacturing material for that department, but only during 

a war or a national emergency declared by Congress or the 

President. 

(3) Except as provided under subsection (b)(3), transportation 

under this subsection shall be provided at reasonable rates of fare 

under regulations prescribed by the Secretary of Defense. 

(4) Persons covered by this subsection, in the case of any military installation, are members of the armed forces, employees of 

the military department concerned, and other persons attached to 

that department who are assigned to or employed at that installation. 

(b)(1) Transportation described in subparagraphs (B), (C), and 

(D) of subsection (a)(2) may not be provided unless the Secretary 

concerned, or an officer of the department concerned designated by 

the Secretary, determines that— 

(A) other facilities are inadequate and cannot be made adequate; 

(B) a reasonable effort has been made to induce operators 

of private facilities to provide the necessary transportation; 

and 

(C) the service to be furnished will make proper use of 

transportation facilities and will supply the most efficient 

transportation to the persons concerned. 

(2) The Secretary of Defense shall require that, in determining 

whether to provide transportation described in subsection (a)(2)(A) 

at any military installation, the Secretary of the military department concerned shall give careful consideration to the potential for 

saving energy and reducing air pollution. 

(3) In providing transportation described in subsection (a)(2)(A) 

at any military installation, the Secretary concerned may not require a fare for the transportation of members of the armed forces 

if the transportation is incident to the performance of duty. In providing transportation described in subsection (a)(2)(C) to and from 

any military installation, the Secretary concerned (under regulations prescribed under subsection (a)(3)) may waive any requirement for a fare. 

(4) The authority under subsection (a) to enter into contracts 

under which the United States is obligated to make outlays shall 

be effective for any fiscal year only to the extent that the budget 

authority for such outlays is provided in advance by appropriation 

Acts. 

(c) To provide transportation under subsection (a), the department may— 

(1) buy, lease, or charter motor vehicles or water carriers 

having a seating capacity of 12 or more passengers; 

(2) maintain and operate that equipment by— 

(A) enlisted members of the Army, Navy, Air Force, 

Marine Corps, or the Coast Guard, as the case may be; 

(B) employees of the department concerned; and 

(C) private persons under contract; and 

(3) lease or charter the equipment to private or public carriers for operation under terms that are considered necessary 
1493 § 2634 CH. 157—TRANSPORTATION 

by the Secretary or by an officer of the department designated 

by the Secretary, and that may provide for the pooling of Government-owned and privately owned equipment and facilities 

and for the reciprocal use of that equipment. 

(d) Fares received under subsection (a), and proceeds of the 

leasing or chartering of equipment under subsection (c)(3), shall be 

covered into the Treasury as miscellaneous receipts. 

(Aug. 10, 1956, ch. 1041, 70A Stat. 146; Pub. L. 95–362, Sept. 11, 1978, 92 Stat. 596; Pub. L. 

96–125, title VIII, Sec. 807(a)–(c)(1), Nov. 26, 1979, 93 Stat. 949, 950; Pub. L. 100–180, div. A, 

title III, Sec. 318(a)–(c), Dec. 4, 1987, 101 Stat. 1076, 1077.) 

§ 2633. Stevedoring and terminal services: vessels carrying 

cargo or passengers sponsored by military department 

(a) Notwithstanding section 1301(a) of title 31, the Secretary of 

a military department may, under such regulations as he may prescribe, furnish stevedoring and terminal services and facilities to 

vessels carrying cargo, or passengers, or both, sponsored by his department. 

(b) The furnishing of services and facilities under this section 

shall be at fair and reasonable rates. 

(c) The proceeds from furnishing services and facilities under 

this section shall be paid to the credit of the appropriation or fund 

out of which the services or facilities were supplied. 

(Added Pub. L. 85–44, Sec. 1, June 1, 1957, 71 Stat. 45; amended Pub. L. 87–651, title I, Sec. 

111(a), Sept. 7, 1962, 76 Stat. 510; Pub. L. 96–513, title V, Sec. 511(87), Dec. 12, 1980, 94 Stat. 

2927; Pub. L. 97–258, Sec. 3(b)(7), Sept. 13, 1982, 96 Stat. 1063.) 

§ 2634. Motor vehicles: transportation or storage for members on change of permanent station or extended 

deployment 

(a) When a member of an armed force is ordered to make a 

change of permanent station, one motor vehicle that is owned or 

leased by the member (or a dependent of the member) and is for 

the personal use of the member or his dependents may, unless a 

motor vehicle owned or leased by him (or a dependent of his) was 

transported in advance of that change of permanent station under 

section 406(h) of title 37, be transported, at the expense of the 

United States, to his new station or such other place as the Secretary concerned may authorize— 

(1) on a vessel owned, leased, or chartered by the United 

States; 

(2) by privately owned American shipping services; 

(3) by foreign-flag shipping services if shipping services described in clauses (1) and (2) are not reasonably available; or 

(4) by other surface transportation if such means of transport does not exceed the cost to the United States of other authorized means. 

When the Secretary concerned determines that a replacement for 

that motor vehicle is necessary for reasons beyond the control of 

the member and is in the interest of the United States, and he approves the transportation in advance, one additional motor vehicle 

of the member (or a dependent of the member) may be so transported. 
§ 2634 CH. 157—TRANSPORTATION 1494 

(b)(1) When a member receives a vehicle storage qualifying 

order, the member may elect to have a motor vehicle described in 

subsection (a) stored at the expense of the United States at a location approved by the Secretary concerned. In the case of a vehicle 

storage qualifying order that is to make a change of permanent station, such storage is in lieu of transportation authorized by subsection (a). 

(2) In this subsection, the term ‘‘vehicle storage qualifying 

order’’ means any of the following: 

(A) An order to make a change of permanent station to a 

foreign country in a case in which the laws, regulations, or 

other restrictions imposed by the foreign country or by the 

United States either— 

(i) preclude entry of a motor vehicle described in subsection (a) into that country; or 

(ii) would require extensive modification of the vehicle 

as a condition to entry. 

(B) An order to make a change of permanent station to a 

nonforeign area outside the continental United States in a case 

in which the laws, regulations, or other restrictions imposed by 

that area or by the United States either— 

(i) preclude entry of a motor vehicle described in subsection (a) into that area; or 

(ii) would require extensive modification of the vehicle 

as a condition to entry. 

(C) An order under which a member is transferred or assigned in connection with a contingency operation to duty at a 

location other than the permanent station of the member for 

a period of more than 30 consecutive days but which is not considered a change of permanent station. 

(3) Authorized expenses under this subsection include costs associated with the delivery of the motor vehicle for storage and removal of the vehicle for delivery to a destination approved by the 

Secretary concerned. 

(4) Storage costs payable under this subsection may be paid in 

advance. 

(c) When there has been a shipping error, or when orders directing a change of permanent station have been canceled, revoked, 

or modified after receipt by the member, a motor vehicle transported pursuant to this section may also be reshipped or transshipped in accordance with this section. 

(d) When the Secretary concerned makes a determination 

under section 406(j) of title 37 that the dependents of a member on 

a permanent change of station are unable to accompany the member to an overseas duty station because of unexpected and uncontrollable circumstances, and the member shipped a motor vehicle 

pursuant to this section in anticipation of a dependent accompanying the member to the new duty station, the member may 

reship or transship such motor vehicle in accordance with this section. 

(e) The Secretary of Defense (and the Secretary of Homeland 

Security with respect to the Coast Guard when it is not operating 

as a service in the Navy) may prescribe regulations limiting those 

leased motor vehicles that may be transported pursuant to this sec-
1495 § 2634 CH. 157—TRANSPORTATION 

tion based upon the length of the lease and other terms and conditions of the lease that the Secretary considers appropriate. 

(f) No carrier, port agent, warehouseman, freight forwarder, or 

other person involved in the transportation of property may have 

any lien on, or hold, impound, or otherwise interfere with, the 

movement of a motor vehicle being transported under this section. 

(g) If a motor vehicle of a member (or a dependent of the member) that is transported at the expense of the United States under 

this section does not arrive at the authorized destination of the vehicle by the designated delivery date, the Secretary concerned shall 

reimburse the member for expenses incurred after that date to rent 

a motor vehicle for the member’s use, or for the use of the dependent for whom the delayed vehicle was transported. The amount reimbursed may not exceed $30 per day, and the rental period for 

which reimbursement may be provided expires after 7 days or on 

the date on which the delayed vehicle arrives at the authorized 

destination (whichever occurs first). 

(h) In the case of a member’s change of permanent station described in subparagraph (A) or (B) of subsection (i)(1), the Secretary concerned may authorize the member to arrange for the 

shipment of the motor vehicle in lieu of transportation at the expense of the United States under this section. The Secretary concerned may pay the member a monetary allowance in lieu of transportation, as established under section 404(d)(1) of title 37, and the 

member shall be responsible for any transportation costs in excess 

of such allowance. 

(i) In this section: 

(1) The term ‘‘change of permanent station’’ means the 

transfer or assignment of a member of the armed forces from 

a permanent station inside the continental United States to a 

permanent station outside the continental United States or 

from a permanent station outside the continental United 

States to another permanent station. It also includes the following: 

(A) An authorized change in home port of a vessel. 

(B) A transfer or assignment between two permanent 

stations in the continental United States when— 

(i) the member cannot, because of injury or the 

conditions of the order, drive the motor vehicle between the permanent duty stations; or 

(ii) the Secretary concerned determines that it is 

advantageous and cost-effective to the United States 

for one motor vehicle of the member to be transported 

between the permanent duty stations. 

(2) The term ‘‘continental United States’’ does not include 

Alaska. 

(3) The term ‘‘nonforeign area outside the continental 

United States’’ means any of the following: the States of Alaska and Hawaii, the Commonwealths of Puerto Rico and the 

Northern Mariana Islands, and any possession of the United 

States. 

(Added Pub. L. 87–651, title I, Sec. 111(b), Sept. 7, 1962, 76 Stat. 510; amended Pub. L. 88– 

431, Sec. 1(b), Aug. 14, 1964, 78 Stat. 439; Pub. L. 89–101, Sec. 1(1), July 30, 1965, 79 Stat. 

425; Pub. L. 93–548, Sec. 1, 2, Dec. 26, 1974, 88 Stat. 1743; Pub. L. 97–60, title II, Sec. 202, 

Oct. 14, 1981, 95 Stat. 1005; Pub. L. 99–661, div. A, title VI, Sec. 611, 620(b)(2), Nov. 14, 1986, 
§ 2635 CH. 157—TRANSPORTATION 1496 

100 Stat. 3878, 3883; Pub. L. 100–26, Sec. 7(j)(6), Apr. 21, 1987, 101 Stat. 283; Pub. L. 100– 

180, div. A, title VI, Sec. 616(a), Dec. 4, 1987, 101 Stat. 1096; Pub. L. 102–484, div. A, title 

VI, Sec. 622(b), Oct. 23, 1992, 106 Stat. 2422; Pub. L. 104–106, div. A, title VI, Sec. 642(a)(2), 

Feb. 10, 1996, 110 Stat. 368; Pub. L. 104–201, div. A, title III, Sec. 368(a)(1), (2)(A), Sept. 23, 

1996, 110 Stat. 2497; Pub. L. 105–261, div. A, title VI, Secs. 631(b)(2), 653(a), Oct. 17, 1998, 

112 Stat. 2044, 2051; Pub. L. 107–107, div. A, title V, Sec. 594(a), (b), Dec. 28, 2001, 115 Stat. 

1126; Pub. L. 107–296, title XVII, Sec. 1704(b)(1), Nov. 25, 2002, 116 Stat. 2314; Pub. L. 107– 

314, div. A, title V, Sec. 575(a), (b), Dec. 2, 2002, 116 Stat. 2558, 2559; Pub. L. 108–136, div. 

A, title VI, Sec. 631(a), Nov. 24, 2003, 117 Stat. 1508.) 

§ 2635. Medical emergency helicopter transportation assistance and limitation of individual liability 

(a) The Secretary of Defense is authorized to assist the Department of Health and Human Services and the Department of Homeland Security in providing medical emergency helicopter transportation services to civilians. Any resources provided under this section shall be under such terms and conditions, including reimbursement, as the Secretary of Defense deems appropriate and shall be 

subject to the following specific limitations: 

(1) Assistance may be provided only in areas where military units able to provide such assistance are regularly assigned, and military units shall not be transferred from one 

area to another for the purpose of providing such assistance. 

(2) Assistance may be provided only to the extent that it 

does not interfere with the performance of the military mission. 

(3) The provision of assistance shall not cause any increase 

in funds required for the operation of the Department of Defense. 

(b) No individual (or his estate) who is authorized by the Department of Defense to perform services under a program established pursuant to subsection (a), and who is acting within the 

scope of his duties, shall be liable for injury to, or loss of property 

or personal injury or death which may be caused incident to providing such services. 

(Added Pub. L. 93–155, title VIII, Sec. 814(a), Nov. 16, 1973, 87 Stat. 620; amended Pub. L. 

96–513, title V, Sec. 511(88), Dec. 12, 1980, 94 Stat. 2928; Pub. L. 107–296, title XVII, Sec. 

1704(b)(1), Nov. 25, 2002, 116 Stat. 2314.) 

§ 2636. Deductions from amounts due carriers 

(a) AMOUNTS FOR LOSS OR DAMAGE.—An amount deducted 

from an amount due a carrier shall be credited as follows: 

(1) If deducted because of loss of or damage to material in 

transit for a military department, the amount shall be credited 

to the proper appropriation, account, or fund from which the 

same or similar material may be replaced. 

(2) If deducted as an administrative offset for an overpayment previously made to the carrier under any Department of 

Defense contract for transportation services or as liquidated 

damages due under any such contract, the amount shall be 

credited to the appropriation or account from which payments 

for the transportation services were made. 

(b) SIMPLIFIED OFFSET FOR COLLECTION OF CLAIMS NOT IN EXCESS OF THE SIMPLIFIED ACQUISITION THRESHOLD.—(1) In any case 

in which the total amount of a claim for the recovery of overpayments or liquidated damages under a contract described in subsection (a)(2) does not exceed the simplified acquisition threshold, 
1497 § 2636a CH. 157—TRANSPORTATION 

the Secretary of Defense or the Secretary concerned, in exercising 

the authority to collect the claim by administrative offset under 

section 3716 of title 31, may apply paragraphs (2) and (3) of subsection (a) of that section with respect to that collection after (rather than before) the claim is so collected. 

(2) Regulations prescribed by the Secretary of Defense under 

subsection (b) of section 3716 of title 31— 

(A) shall include provisions to carry out paragraph (1); and 

(B) shall provide the carrier for a claim subject to paragraph (1) with an opportunity to offer an alternative method 

of repaying the claim (rather than by administrative offset) if 

the collection of the claim by administrative offset has not already been made. 

(3) In this subsection, the term ‘‘simplified acquisition threshold’’ has the meaning given that term in section 134 of title 41. 

(Added Pub. L. 97–258, Sec. 2(b)(5)(B), Sept. 13, 1982, 96 Stat. 1053; amended Pub. L. 106– 

398, Sec. 1 [[div. A], title X, Sec. 1009(a)(1)], Oct. 30, 2000, 114 Stat. 1654, 1654A–250; Pub. 

L. 111–350, Sec. 5(b)(43), Jan. 4, 2011, 124 Stat. 3846.) 

§ 2636a. Loss or damage to personal property transported at 

Government expense: full replacement value; deduction from amounts due carriers 

(a) PROCUREMENT OF COVERAGE.—The Secretary of Defense 

shall include in a contract for the transportation at Government expense of baggage and household effects for members of the armed 

forces or civilian employees of the Department of Defense (or both) 

a clause that requires the carrier under the contract to pay the full 

replacement value for loss or damage to the baggage or household 

effects transported under the contract. 

(b) DEDUCTION UPON FAILURE OF CARRIER TO SETTLE.—In the 

case of a loss or damage of baggage or household effects transported under a contract with a carrier that includes a clause described in subsection (a), the amount equal to the full replacement 

value for the baggage or household effects shall be deducted from 

the amount owed by the United States to the carrier under the contract upon a failure of the carrier to settle a claim for such loss or 

total damage within a reasonable time. The amount so deducted 

shall be remitted to the claimant, notwithstanding section 2636 of 

this title. 

(c) INAPPLICABILITY OF RELATED LIMITS.—The limitations on 

amounts of claims that may be settled under section 3721(b) of title 

31 do not apply to a carrier’s contractual obligation to pay full replacement value under this section. 

(d) REGULATIONS.—The Secretary of Defense shall prescribe 

regulations for administering this section. The regulations shall include policies and procedures for validating and evaluating claims, 

validating proper claimants, and determining reasonable time for 

settlement. The regulations may include a requirement that a 

member of the armed forces or civilian employee of the Department 

of Defense comply with reasonable restrictions or conditions prescribed by the Secretary in order to receive the full amount deducted under subsection (b). 

(e) TRANSPORTATION DEFINED.—In this section, the terms 

‘‘transportation’’ and ‘‘transport’’, with respect to baggage or house-
§ 2637 CH. 157—TRANSPORTATION 1498 

hold effects, includes packing, crating, drayage, temporary storage, 

and unpacking of the baggage or household effects. 

(Added Pub. L. 108–136, div. A, title VI, Sec. 634(a), Nov. 24, 2003, 117 Stat. 1509; amended 

Pub. L. 109–364, div. A, title III, Sec. 363(a), (b), Oct. 17, 2006, 120 Stat. 2167; Pub. L. 110– 

181, div. A, title III, Sec. 373, Jan. 28, 2008, 122 Stat. 82.) 

§ 2637. Transportation in certain areas outside the United 

States 

The Secretary of Defense may authorize the commander of a 

unified combatant command to use Government owned or leased 

vehicles to provide transportation in an area outside the United 

States for members of the uniformed services and Federal civilian 

employees under the jurisdiction of that commander, and for the 

dependents of such members and employees, if the commander determines that public or private transportation in such area is unsafe or not available. Such transportation shall be provided in accordance with regulations prescribed by the Secretary of Defense. 

(Added Pub. L. 101–510, div. A, title III, Sec. 326(a)(1), Nov. 5, 1990, 104 Stat. 1531.) 

§ 2638. Transportation of civilian clothing of enlisted members 

The Secretary of the military department concerned may provide for the transportation of the civilian clothing of any person entering the armed forces as an enlisted member to the member’s 

home of record. 

(Added Pub. L. 98–525, title XIV, Sec. 1401(j)(1), Oct. 19, 1984, 98 Stat. 2620.) 

§ 2639. Transportation to and from school for certain minor 

dependents 

Funds appropriated to the Department of Defense may be used 

to provide minor dependents of members of the armed forces and 

of civilian officers and employees of the Department of Defense 

with transportation to and from primary and secondary schools if 

the schools attended by the dependents are not accessible by regular means of transportation. 

(Added Pub. L. 98–525, title XIV, Sec. 1401(j)(1), Oct. 19, 1984, 98 Stat. 2620.) 

§ 2640. Charter air transportation of members of the armed 

forces 

(a) REQUIREMENTS.—(1) The Secretary of Defense may not 

enter into a contract with an air carrier for the charter air transportation of members of the armed forces unless the air carrier— 

(A) meets, at a minimum, the safety standards established 

by the Secretary of Transportation under chapter 447 of title 

49; 

(B) has at least 12 months of experience operating services 

in air transportation that are substantially equivalent to the 

service sought by the Department of Defense; and 

(C) undergoes a technical safety evaluation. 

(2) For purposes of paragraph (1)(C), a technical safety evaluation— 

(A) shall include inspection of a representative number of 

aircraft; and 
1499 § 2640 CH. 157—TRANSPORTATION 

(B) shall be conducted in accordance with regulations prescribed by the Secretary, after consultation with the Secretary 

of Transportation. 

(b) INSPECTIONS.—The Secretary shall provide for inspections 

of each air carrier that contracts with the Department of Defense 

for the charter air transportation of members of the armed forces. 

The inspections shall be conducted in accordance with standards 

established by the Secretary, after consultation with the Secretary 

of Transportation, and shall include, at a minimum, the following: 

(1) An on-site capability survey of the air carrier conducted 

at least once every two years. 

(2) A performance evaluation of the air carrier conducted 

at least once every six months. 

(3) A preflight safety inspection of each aircraft conducted 

at any time during the operation of, but not more than 72 

hours before, each internationally scheduled charter mission 

departing the United States. 

(4) A preflight safety inspection of each aircraft used for 

domestic charter missions conducted to the greatest extent 

practical. 

(5) Operational check-rides on aircraft conducted periodically. 

(c) COMMERCIAL AIRLIFT REVIEW BOARD.—The Secretary shall 

establish a Commercial Airlift Review Board within the Department of Defense. The Board shall consist of personnel from the Department of Defense and other Government personnel as may be 

appropriate. The duties of the Board shall be— 

(1) to make recommendations to the Secretary on suspension and reinstatement of air carriers under subsection (d); 

(2) to make recommendations to the Secretary on waivers 

under subsection (g); and 

(3) to carry out such other duties and make recommendations on such other matters as the Secretary considers appropriate. 

(d) SUSPENSION AND REINSTATEMENT.—(1) The Secretary shall 

establish guidelines for the suspension of air carriers under contract with the Department of Defense for the charter air transportation of members of the armed forces and for the reinstatement 

of air carriers that have been so suspended. The guidelines— 

(A) shall require the immediate determination of whether 

to suspend an air carrier if an aircraft of the air carrier is involved in a fatal accident; and 

(B) may require the suspension of an air carrier— 

(i) if the carrier is in violation of any order, rule, regulation, or standard prescribed under chapter 447 of title 

49; or 

(ii) if an aircraft of the air carrier is involved in a serious accident. 

(2) The Commercial Airlift Review Board shall make recommendations to the Secretary on suspension and reinstatement 

under this subsection. 

(3) The Secretary shall include in each contract subject to this 

section the provisions on suspension and reinstatement established 

under this subsection. 
§ 2640 CH. 157—TRANSPORTATION 1500 

(e) AUTHORITY TO LEAVE UNSAFE AIRCRAFT.—A representative 

of the Military Airlift Command, the Military Traffic Management 

Command, or such other agency as may be designated by the Secretary of Defense (or if there is no such representative reasonably 

available, the senior officer on board a chartered aircraft) may 

order members of the armed forces to leave a chartered aircraft if 

the representative (or officer) determines that a condition exists on 

the aircraft which may endanger the safety of the members. 

(f) FAA INFORMATION.—The Secretary shall request the Secretary of Transportation to provide to the Secretary a report on 

each inspection performed by Federal Aviation Administration personnel, and the status of corrective actions taken, on each aircraft 

of an air carrier under contract with the Department of Defense for 

the charter air transportation of members of the armed forces. 

(g) WAIVER.—After considering recommendations by the Commercial Airlift Review Board, the Secretary may waive any provision of this section in an emergency. 

(h) AUTHORITY TO PROTECT SAFETY-RELATED INFORMATION

VOLUNTARILY PROVIDED BY AN AIR CARRIER.—(1) Subject to paragraph (2), the Secretary of Defense may (notwithstanding any other 

provision of law) withhold from public disclosure safety-related information that is provided to the Secretary voluntarily by an air 

carrier for the purposes of this section. 

(2) Information may be withheld under paragraph (1) from 

public disclosure only if the Secretary determines that— 

(A) the disclosure of the information would inhibit an air 

carrier from voluntarily providing, in the future, safety-related 

information for the purposes of this section or for other air 

safety purposes involving the Department of Defense or another Federal agency; and 

(B) the receipt of such information generally enhances the 

fulfillment of responsibilities under this section or other air 

safety responsibilities involving the Department of Defense or 

another Federal agency. 

(3) If the Secretary provides to the head of another agency 

safety-related information described in paragraph (1) with respect 

to which the Secretary has made a determination described in 

paragraph (2), the head of that agency shall (notwithstanding any 

other provision of law) withhold the information from public disclosure unless the disclosure is specifically authorized by the Secretary. 

(i) REGULATIONS.—The Secretary shall prescribe regulations to 

carry out this section, including requirements and identification of 

inspecting personnel with respect to preflight safety inspections required by subsection (b)(3). 

(j) DEFINITIONS.—In this section: 

(1) The terms ‘‘air carrier’’, ‘‘aircraft’’, ‘‘air transportation’’, 

and ‘‘charter air transportation’’ have the meanings given such 

terms by section 40102(a) of title 49. 

(2) The term ‘‘members of the armed forces’’ means members of the Army, Navy, Air Force, and Marine Corps. 

(Added Pub. L. 99–661, div. A, title XII, Sec. 1204(a)(1), Nov. 14, 1986, 100 Stat. 3969; amended 

Pub. L. 103–272, Sec. 5(b)(1), July 5, 1994, 108 Stat. 1373; Pub. L. 105–85, div. A, title X, Sec. 

1075(a), Nov. 18, 1997, 111 Stat. 1911.) 
1501 § 2641a CH. 157—TRANSPORTATION 

§ 2641. Transportation of certain veterans on Department of 

Defense aeromedical evacuation aircraft 

(a) The Secretary of Defense may provide transportation on an 

aircraft operating under the aeromedical evacuation system of the 

Department of Defense for the purpose of transporting a veteran to 

or from a Department of Veterans Affairs medical facility or of 

transporting the remains of a deceased veteran who died at such 

a facility after being transported to the facility under this subsection. Transportation of the remains of a deceased veteran under 

this subsection may be provided to the place from which the veteran was transported to the facility or to any other destination 

which is not farther away from the facility than such place. 

(b) Transportation under this section shall be provided in accordance with an agreement entered into between the Secretary of 

Defense and the Secretary of Veterans Affairs. Such an agreement 

shall provide that transportation may be furnished to a veteran (or 

for the remains of a veteran) on an aircraft referred to in subsection (a) only if— 

(1) the Secretary of Veterans Affairs notifies the Secretary 

of Defense that the veteran needs or has been furnished medical care or services in a Department of Veterans Affairs facility and the Secretary of Veterans Affairs requests such transportation in connection with the travel of such veteran (or of 

the remains of such veteran) to or from the Department of Veterans Affairs facility where the care or services are to be furnished or were furnished to such veteran; 

(2) there is space available for the veteran (or the remains 

of the veteran) on the aircraft; and 

(3) there is an adequate number of medical and other service attendants to care for all persons being transported on the 

aircraft. 

(c) A veteran is not eligible for transportation under this section unless the veteran is a primary beneficiary within the meaning of clause (A) of section 8111(g)(5) of title 38. 

(d)(1) A charge may not be imposed on a veteran (or on the 

survivors of a veteran) for transportation provided to the veteran 

(or for the remains of the veteran) under this section. 

(2) An agreement under subsection (b) shall provide that the 

Department of Veterans Affairs shall reimburse the Department of 

Defense for any costs incurred in providing transportation to veterans (or for the remains of veterans) under this section that would 

not otherwise have been incurred by the Department of Defense. 

(e) In this section, the term ‘‘veteran’’ has the meaning given 

that term in section 101(2) of title 38. 

(Added Pub. L. 100–180, div. A, title XII, Sec. 1250(a)(1), Dec. 4, 1987, 101 Stat. 1167; amended 

Pub. L. 101–189, div. A, title XVI, Sec. 1621(a)(1), (2), (8), Nov. 29, 1989, 103 Stat. 1602, 1603; 

Pub. L. 103–337, div. A, title VI, Sec. 652(b), title X, Sec. 1070(e)(8), Oct. 5, 1994, 108 Stat. 2794, 

2859.) 

§ 2641a. Transportation of American Samoa veterans on Department of Defense aircraft for certain medical 

care in Hawaii 

(a) TRANSPORTATION AUTHORIZED.—The Secretary of Defense 

may provide transportation on Department of Defense aircraft for 
§ 2641b CH. 157—TRANSPORTATION 1502 

the purpose of transporting any veteran specified in subsection (b) 

between American Samoa and the State of Hawaii if such transportation is required in order to provide hospital care to such veteran 

as described in that subsection. 

(b) VETERANS ELIGIBLE FOR TRANSPORT.—A veteran eligible for 

transport under subsection (a) is any veteran who— 

(1) resides in and is located in American Samoa; and 

(2) as determined by an official of the Department of Veterans Affairs designated for that purpose by the Secretary of 

Veterans Affairs, must be transported to the State of Hawaii 

in order to receive hospital care to which such veteran is entitled under chapter 17 of title 38 in facilities of such Department in the State of Hawaii. 

(c) ADMINISTRATION.—(1) Transportation may be provided to 

veterans under this section only on a space-available basis. 

(2) A charge may not be imposed on a veteran for transportation provided to the veteran under this section. 

(Added Pub. L. 105–262, title VIII, Sec. 8121(a), Oct. 17, 1998, 112 Stat. 2332; amended Pub. 

L. 106–65, div. A, title X, Sec. 1066(a)(24), Oct. 5, 1999, 113 Stat. 771.) 

§ 2641b. Space-available travel on Department of Defense 

aircraft: retired members residing in Commonwealths and possessions of the United States for 

certain health care services 

(a) PRIORITY TRANSPORTATION.—The Secretary of Defense shall 

provide transportation on Department of Defense aircraft on a 

space-available basis for any member or former member of the uniformed services described in subsection (b), and a single dependent 

of the member if needed to accompany the member, at a priority 

level in the same category as the priority level for an unaccompanied dependent over the age of 18 traveling on environmental 

and morale leave. 

(b) ELIGIBLE MEMBERS AND FORMER MEMBERS.—A member or 

former member eligible for priority transport under subsection (a) 

is a covered beneficiary under chapter 55 of this title who— 

(1) is entitled to retired or retainer pay; 

(2) resides in or is located in a Commonwealth or possession of the United States; and 

(3) is referred by a military or civilian primary care provider located in that Commonwealth or possession to a specialty care provider for services to be provided outside of that 

Commonwealth or possession. 

(c) SCOPE OF PRIORITY.—The increased priority for space-available transportation required by subsection (a) applies with respect 

to both— 

(1) the travel from the Commonwealth or possession of the 

United States to receive the specialty care services; and 

(2) the return travel. 

(d) DEFINITIONS.—In this section, the terms ‘‘primary care provider’’ and ‘‘specialty care provider’’ refer to a medical or dental 

professional who provides health care services under chapter 55 of 

this title. 

(e) REGULATIONS.—The Secretary of Defense shall prescribe 

regulations to implement this section. 
1503 § 2643 CH. 157—TRANSPORTATION 

(Added Pub. L. 110–181, div. A, title III, Sec. 374(a), Jan. 28, 2008, 122 Stat. 82.) 

§ 2642. Airlift services provided to certain other agencies: 

use of Department of Defense reimbursement rate 

(a) AUTHORITY.—The Secretary of Defense may authorize the 

use of the Department of Defense reimbursement rate for military 

airlift services provided by a component of the Department of Defense as follows: 

(1) For military airlift services provided to the Central Intelligence Agency, if the Secretary of Defense determines that 

those military airlift services are provided for activities related 

to national security objectives. 

(2) For military airlift services provided to the Department 

of State for the transportation of armored motor vehicles to a 

foreign country to meet requirements of the Department of 

State for armored motor vehicles associated with the overseas 

travel of the Secretary of State in that country. 

(3) During the period beginning on October 28, 2009, and 

ending on October 28, 2014, for military airlift services provided to any element of the Federal Government outside the 

Department of Defense in circumstances other than those specified in paragraphs (1) and (2), but only if the Secretary of Defense determines that the provision of such services will promote the improved use of airlift capacity without any negative 

effect on the national security objectives or the national security interests contained within the United States commercial 

air industry. 

(b) DEFINITION.—In this section, the term ‘‘Department of Defense reimbursement rate’’ means the amount charged a component 

of the Department of Defense by another component of the Department of Defense. 

(Added Pub. L. 102–88, title V, Sec. 501(a), Aug. 14, 1991, 105 Stat. 435; amended Pub. L. 108– 

136, div. A, title X, Sec. 1006(a), (b)(1), Nov. 24, 2003, 117 Stat. 1585; Pub. L. 111–84, div. A, 

title III, Sec. 351(a), Oct. 28, 2009, 123 Stat. 2262; Pub. L. 111–383, div. A, title X, Sec. 

1075(b)(40), Jan. 7, 2011, 124 Stat. 4371.) 

§ 2643. Commissary and exchange services: transportation 

overseas 

(a) TRANSPORTATION OPTIONS.—The Secretary of Defense shall 

authorize the officials responsible for operation of commissaries 

and military exchanges to negotiate directly with private carriers 

for the most cost-effective transportation of commissary and exchange supplies to destinations outside the continental United 

States without relying on the Air Mobility Command, the Military 

Sealift Command, or the Military Traffic Management Command. 

Section 2631 of this title, regarding the preference for vessels of the 

United States or belonging to the United States in the transportation of supplies by sea, shall apply to the negotiation of contracts 

for sea-borne transportation under the authority of this section. 

(b) PAYMENT OF TRANSPORTATION COSTS.—Section 2483(b)(5) of 

this title, regarding the use of appropriated funds to cover the expenses of operating commissary stores, shall apply to the transportation of commissary supplies and products. Appropriated funds for 

the Department of Defense shall also be used to cover the expenses 
§ 2644 CH. 157—TRANSPORTATION 1504 

of transporting exchange supplies and products to destinations outside the continental United States. 

(Added Pub. L. 104–106, div. A, title III, Sec. 334(a), Feb. 10, 1996, 110 Stat. 261; amended 

Pub. L. 109–163, div. A, title VI, Sec. 673, Jan. 6, 2006, 119 Stat. 3319.) 

§ 2644. Control of transportation systems in time of war 

In time of war, the President, through the Secretary of Defense, may take possession and assume control of all or part of any 

system of transportation to transport troops, war material, and 

equipment, or for other purposes related to the emergency. So far 

as necessary, he may use the system to the exclusion of other traffic. 

(Aug. 10, 1956, ch. 1041, 70A Stat. 266, Sec. 4742; renumbered Sec. 2644 and amended Pub. 

L. 104–201, div. A, title IX, Sec. 906(a), (b), Sept. 23, 1996, 110 Stat. 2620.) 

§ 2645. Indemnification of Department of Transportation for 

losses covered by vessel war risk insurance 

(a) PROMPT INDEMNIFICATION REQUIRED.—(1) In the event of a 

loss that is covered by vessel war risk insurance, the Secretary of 

Defense shall promptly indemnify the Secretary of Transportation 

for the amount of the loss consistent with the indemnification 

agreement between the two Secretaries that underlies such insurance. The Secretary of Defense shall make such indemnification— 

(A) in the case of a claim for the loss of a vessel, not later 

than 90 days after the date on which the Secretary of Transportation determines the claim to be payable or that amounts 

are due under the policy that provided the vessel war risk insurance; and 

(B) in the case of any other claim, not later than 180 days 

after the date on which the Secretary of Transportation determines the claim to be payable. 

(2) When there is a loss of a vessel that is (or may be) covered 

by vessel war risk insurance, the Secretary of Transportation may 

make, during the period when a claim for such loss is pending with 

the Secretary of Transportation, any required periodic payments 

owed by the insured party to a lessor or mortgagee of such vessel. 

Such payments shall commence not later than 30 days following 

the date of the presentment of the claim for the loss of the vessel 

to the Secretary of Transportation. If the Secretary of Transportation determines that the claim is payable, any amount paid 

under this paragraph arising from such claim shall be credited 

against the amount payable under the vessel war risk insurance. 

If the Secretary of Transportation determines that the claim is not 

payable, any amount paid under this paragraph arising from such 

claim shall constitute a debt to the United States, payable to the 

insurance fund. Any such amounts so returned to the United 

States shall be promptly credited to the fund or account from which 

the payments were made under this paragraph. 

(b) SOURCE OF FUNDS FOR PAYMENT OF INDEMNITY.—The Secretary of Defense may pay an indemnity described in subsection (a) 

from any funds available to the Department of Defense for operation and maintenance, and such sums as may be necessary for 

payment of such indemnity are hereby authorized to be transferred 

to the Secretary of Transportation for such purpose. 
1505 § 2646 CH. 157—TRANSPORTATION 

(c) DEPOSIT OF FUNDS.—Any amount transferred to the Secretary of Transportation under this section shall be deposited in, 

and merged with amounts in, the Vessel War Risk Insurance Fund 

as provided in section 53909(b) of title 46. 

(d) NOTICE TO CONGRESS.—In the event of a loss that is covered by vessel war risk insurance in the case of an incident in 

which the covered loss is (or is expected to be) in an amount in excess of $1,000,000, the Secretary of Defense shall submit to Congress notification of the loss as soon after the occurrence of the loss 

as possible and in no event more than 30 days after the date of the 

loss. 

(e) IMPLEMENTING MATTERS.—(1) Payment of indemnification 

under this section is not subject to section 2214 or 2215 of this title 

or any other provision of law requiring notification to Congress before funds may be transferred. 

(2) Consolidation of claims arising from the same incident is 

not required before indemnification of the Secretary of Transportation for payment of a claim may be made under this section. 

(f) CONSTRUCTION WITH OTHER TRANSFER AUTHORITY.—Authority to transfer funds under this section is in addition to any 

other authority provided by law to transfer funds (whether enacted 

before, on, or after the date of the enactment of this section) and 

is not subject to any dollar limitation or notification requirement 

contained in any other such authority to transfer funds. 

[(g) Repealed. Pub. L. 108–136, div. A, title X, Sec. 

1031(a)(26)(B), Nov. 24, 2003, 117 Stat. 1598.] 

(h) DEFINITIONS.—In this section: 

(1) VESSEL WAR RISK INSURANCE.—The term ‘‘vessel war 

risk insurance’’ means insurance and reinsurance provided 

through policies issued by the Secretary of Transportation 

under chapter 539 of title 46 that is provided by that Secretary 

without premium at the request of the Secretary of Defense 

and is covered by an indemnity agreement between the Secretary of Transportation and the Secretary of Defense. 

(2) VESSEL WAR RISK INSURANCE FUND.—The term ‘‘Vessel 

War Risk Insurance Fund’’ means the insurance fund referred 

to in section 53909(a) of title 46. 

(3) LOSS.—The term ‘‘loss’’ includes damage to or destruction of property, personal injury or death, and other liabilities 

and expenses covered by the vessel war risk insurance. 

(Added Pub. L. 104–201, div. A, title X, Sec. 1079(b)(1), Sept. 23, 1996, 110 Stat. 2669; amended 

Pub. L. 105–85, div. A, title X, Sec. 1073(a)(57), Nov. 18, 1997, 111 Stat. 1903; Pub. L. 108– 

136, div. A, title X, Sec. 1031(a)(26), Nov. 24, 2003, 117 Stat. 1598; Pub. L. 109–304, Sec. 

17(a)(4), Oct. 6, 2006, 120 Stat. 1706.) 

§ 2646. Travel services: procurement for official and unofficial travel under one contract 

(a) AUTHORITY.—The head of an agency may enter into a contract for travel-related services that provides for the contractor to 

furnish services for both official travel and unofficial travel. 

(b) CREDITS, DISCOUNTS, COMMISSIONS, FEES.—(1) A contract 

entered into under this section may provide for credits, discounts, 

or commissions or other fees to accrue to the Department of Defense. The accrual and amounts of credits, discounts, or commissions or other fees may be determined on the basis of the volume 
§ 2647 CH. 157—TRANSPORTATION 1506 

(measured in the number or total amount of transactions or otherwise) of the travel-related sales that are made by the contractor 

under the contract. 

(2) The evaluation factors applicable to offers for a contract 

under this section may include a factor that relates to the estimated aggregate value of any credits, discounts, commissions, or 

other fees that would accrue to the Department of Defense for the 

travel-related sales made under the contract. 

(3) Commissions or fees received by the Department of Defense 

as a result of travel-related sales made under a contract entered 

into under this section shall be distributed as follows: 

(A) For amounts relating to sales for official travel, credit 

to appropriations available for official travel for the fiscal year 

in which the amounts were charged. 

(B) For amounts relating to sales for unofficial travel, deposit in nonappropriated fund accounts available for morale, 

welfare, and recreation programs. 

(c) DEFINITIONS.—In this section: 

(1) The term ‘‘head of an agency’’ has the meaning given 

that term in section 2302(1) of this title. 

(2) The term ‘‘official travel’’ means travel at the expense 

of the Federal Government. 

(3) The term ‘‘unofficial travel’’ means personal travel or 

other travel that is not paid for or reimbursed by the Federal 

Government out of appropriated funds. 

(d) INAPPLICABILITY TO COAST GUARD AND NASA.—This section 

does not apply to the Coast Guard when it is not operating as a 

service in the Navy, nor to the National Aeronautics and Space Administration. 

(Added Pub. L. 105–261, div. A, title VIII, Sec. 813(a), Oct. 17, 1998, 112 Stat. 2087.) 

§ 2647. Next-of-kin of persons unaccounted for from conflicts after World War II: transportation to annual 

meetings 

The Secretary of Defense may provide transportation for the 

next-of-kin of persons who are unaccounted for from the Korean 

conflict, the Cold War, Vietnam War era, or the Persian Gulf War 

to and from an annual meeting in the United States. Such transportation shall be provided under such regulations as the Secretary 

of Defense may prescribe. 

(Added Pub. L. 107–107, title V, Sec. 574(a), Dec. 28, 2001, 115 Stat. 1122.) 

§ 2648. Persons and supplies: sea, land, and air transportation 

Whenever the Secretary of Defense considers that space is 

available, the following persons and supplies may be transported 

on vessels, vehicles, or aircraft operated by the Department of Defense: 

(1) Members of Congress. 

(2) Other officers of the United States traveling on official 

business. 

(3) Secretaries and supplies of the Armed Services Department of the Young Men’s Christian Association. 
1507 § 2650 CH. 157—TRANSPORTATION 

(4) Officers and employees of the Commonwealth of Puerto 

Rico on official business. 

(5) The families of members of the armed forces, officers 

and employees of the Department of Defense or the Coast 

Guard, and persons described in paragraphs (1), (2), and (4). 

However, a person described in paragraph (4) or (5) may be so 

transported only if the transportation is without expense to the 

United States. 

(Aug. 10, 1956, ch. 1041, 70A Stat. 266, Sec. 4744; Pub. L. 86–624, Sec. 4(d), July 12, 1960, 

74 Stat. 411; renumbered Sec. 2648 and amended Pub. L. 108–375, div. A, title X, Sec. 1072(a), 

(b)(1), Oct. 28, 2004, 118 Stat. 2057; Pub. L. 111–383, div. A, title III, Sec. 352(d), (e)(1), Jan. 

7, 2011, 124 Stat. 4193.) 

§ 2649. Civilian passengers and commercial cargoes: transportation on Department of Defense vessels, vehicles, and aircraft 

(a) AUTHORITY.—Whenever space is unavailable on commercial 

lines and is available on vessels, vehicles, or aircraft operated by 

the Department of Defense, civilian passengers and commercial 

cargo may, in the discretion of the Secretary of Defense, be transported on those vessels, vehicles, or aircraft. Rates for transportation under this section may not be less than those charged by 

commercial lines for the same kinds of service, except that in the 

case of transportation provided in response to an emergency, a disaster, or a request for humanitarian assistance, any amount 

charged for such transportation may not exceed the cost of providing the transportation. 

(b) CREDITING OF RECEIPTS.—Any amount received under this 

section with respect to transportation provided in response to an 

emergency, a disaster, or a request for humanitarian assistance 

may be credited to the appropriation, fund, or account used in incurring the obligation for which such amount is received. In all 

other cases, amounts received under this section shall be covered 

into the Treasury as miscellaneous receipts. 

(c) TRANSPORTATION OF ALLIED PERSONNEL DURING CONTINGENCIES OR DISASTER RESPONSES.—During the 5-year period beginning on the date of the enactment of the Ike Skelton National Defense Authorization Act for Fiscal Year 2011, when space is available on vessels, vehicles, or aircraft operated by the Department of 

Defense and the Secretary of Defense determines that operations 

in the area of a contingency operation or disaster response would 

be facilitated if allied forces or civilians were to be transported 

using such vessels, vehicles, or aircraft, the Secretary may provide 

such transportation on a noninterference basis, without charge. 

(Aug. 10, 1956, ch. 1041, 70A Stat. 267, Sec. 4745; Pub. L. 96–513, title V, Sec. 512(22), Dec. 

12, 1980, 94 Stat. 2930; Pub. L. 97–31, Sec. 12(3)(C), Aug. 6, 1981, 95 Stat. 154; Pub. L. 107– 

296, title XVII, Sec. 1704(b)(1), Nov. 25, 2002, 116 Stat. 2314; renumbered Sec. 2649 and amended Pub. L. 108–375, div. A, title X, Sec. 1072(a), (b)(2), Oct. 28, 2004, 118 Stat. 2057; Pub. L. 

111–383, div. A, title III, Sec. 352(a)–(c), (e)(2), Jan. 7, 2011, 124 Stat. 4193, 4194.) 

§ 2650. Civilian personnel in Alaska 

Persons residing in Alaska who are and have been employed 

there by the United States for at least two years, and their families, may be transported on vessels or airplanes operated by the 

Department of Defense, if— 
§ 2651 CH. 157—TRANSPORTATION 1508 

(1) the Secretary of Defense considers that accommodations are available; 

(2) the transportation is without expense to the United 

States; 

(3) the transportation is limited to one round trip between 

Alaska and the United States during any two-year period, except in an emergency such as sickness or death; and 

(4) in case of travel by air, the transportation cannot be 

reasonably handled by a United States commercial air carrier. 

(Aug. 10, 1956, ch. 1041, 70A Stat. 267, Sec. 4746; Pub. L. 98–443, Sec. 9(k), Oct. 4, 1984, 98 

Stat. 1708; renumbered Sec. 2650 and amended Pub. L. 108–375, div. A, title X, Sec. 1072(a), 

(b)(3), Oct. 28, 2004, 118 Stat. 2057, 2058.) 

§ 2651. Passengers and merchandise to Guam: sea transport 

Whenever space is available, passengers, and merchandise produced in the United States, or the Commonwealths and possessions, and consigned to residents and mercantile firms of Guam, 

may be transported to Guam on vessels operated by the Department of Defense, under regulations and at rates to be prescribed 

by the Secretary of Defense. 

(Aug. 10, 1956, ch. 1041, 70A Stat. 267, Sec. 4747; renumbered Sec. 2651 and amended Pub. 

L. 108–375, div. A, title X, Sec. 1072(a), (b)(4), Oct. 28, 2004, 118 Stat. 2057, 2058; Pub. L. 109– 

163, div. A, title X, Sec. 1057(a)(6), Jan. 6, 2006, 119 Stat. 3441; Pub. L. 111–383, div. A, title 

X, Sec. 1075(h)(4)(A)(ii), Jan. 7, 2011, 124 Stat. 4377.) 
1509 

CHAPTER 159—REAL PROPERTY; RELATED PERSONAL 

PROPERTY; AND LEASE OF NON-EXCESS PROPERTY 

Sec. 

2661. Miscellaneous administrative provisions relating to real property. 

[2661a. Repealed.] 

2662. Real property transactions: reports to congressional committees. 

2663. Land acquisition authorities. 

2664. Limitations on real property acquisition. 

2665. Sale of certain interests in land; logs. 

[2666. Repealed.] 

2667. Leases: non-excess property of military departments and Defense Agencies. 

[2667a. Repealed.] 

2668. Easements for rights-of-way. 

2668a. Easements: granting restrictive easements in connection with land conveyances. 

[2669. Repealed.] 

2670. Use of facilities by private organizations; use as polling places. 

2671. Military reservations and facilities: hunting, fishing, and trapping. 

[2672 to 2673. Repealed.] 

2674. Operation and control of Pentagon Reservation and defense facilities in 

National Capital Region. 

2675. Leases: foreign countries. 

[2676, 2677. Renumbered or Repealed.] 

2678. Feral horses and burros: removal from military installations. 

[2679, 2680. Repealed.] 

2681. Use of test and evaluation installations by commercial entities. 

2682. Facilities for defense agencies. 

2683. Relinquishment of legislative jurisdiction; minimum drinking age on military installations. 

2684. Cooperative agreements for management of cultural resources. 

2684a. Agreements to limit encroachments and other constraints on military 

training, testing, and operations. 

2685. Adjustment of or surcharge on selling prices in commissary stores to provide funds for construction and improvement of commissary store facilities. 

2686. Utilities and services: sale; expansion and extension of systems and facilities. 

2687. Base closures and realignments. 

2687a. Overseas base closures and realignments and basing master plans. 

2688. Utility systems: conveyance authority. 

[2689, 2690. Renumbered.] 

2691. Restoration of land used by permit or lease. 

2692. Storage, treatment, and disposal of nondefense toxic and hazardous materials. 

[2693. Repealed.] 

2694. Conservation and cultural activities. 

2694a. Conveyance of surplus real property for natural resource conservation. 

2694b. Participation in wetland mitigation banks. 

2694c. Participation in conservation banking programs. 

2695. Acceptance of funds to cover administrative expenses relating to certain 

real property transactions. 

2696. Real property: transfer between armed forces and screening requirements 

for other Federal use. 

2697. Acceptance and use of landing fees charged for use of domestic military 

airfields by civil aircraft. 
§ 2661 CH. 159—REAL PROPERTY 1510 

§ 2661. Miscellaneous administrative provisions relating to 

real property 

(a) AVAILABILITY OF OPERATION AND MAINTENANCE FUNDS.— 

Appropriations for operation and maintenance of the active forces 

shall be available for the following: 

(1) The repair of facilities. 

(2) The installation of equipment in public and private 

plants. 

(b) LEASING AND ROAD MAINTENANCE AUTHORITY.—The Secretary of Defense and the Secretary of each military department 

may provide for the following: 

(1) The leasing of buildings and facilities (including the 

payment of rentals for special purpose space at the seat of Government). Rental for such leases may be paid in advance in 

connection with— 

(A) the conduct of field exercises and maneuvers; and 

(B) the administration of the Act of July 9, 1942 (43 

U.S.C. 315q). 

(2) The maintenance of defense access roads which are certified to the Secretary of Transportation as important to the 

national defense under the provisions of section 210 of title 23. 

[(c) Renumbered Sec. 2664(b)] 

(d) TREATMENT OF PENTAGON RESERVATION.—In this chapter, 

the terms ‘‘Secretary concerned’’ and ‘‘Secretary of a military department’’ include the Secretary of Defense with respect to the Pentagon Reservation. 

(Added Pub. L. 100–370, Sec. 1(l)(3), July 19, 1988, 102 Stat. 849; amended Pub. L. 108–375, 

div. B, title XXVIII, Sec. 2821(a)(1), (e)(1), Oct. 28, 2004, 118 Stat. 2129, 2130; Pub. L. 109– 

163, div. B, title XXVIII, Sec. 2821(d), (e), Jan. 6, 2006, 119 Stat. 3512.) 

[§ 2661a. Repealed. Pub. L. 97–295, Sec. 1(31)(A), Oct. 12, 

1982, 96 Stat. 1296] 

§ 2662. Real property transactions: reports to congressional 

committees 

(a) GENERAL NOTICE AND WAIT REQUIREMENTS.—(1) The Secretary of a military department or, with respect to a Defense Agency, the Secretary of Defense may not enter into any of the following 

listed transactions by or for the use of that department until the 

Secretary concerned submits a report, subject to paragraph (3), to 

the Committee on Armed Services of the Senate and the Committee on Armed Services of the House of Representatives: 

(A) An acquisition of fee title to any real property, if the 

estimated price is more than $750,000. 

(B) A lease of any real property to the United States, if the 

estimated annual rental is more than $750,000. 

(C) A lease or license of real property owned by the United 

States (other than a lease or license entered into under section 

2667(g) of this title), if the estimated annual fair market rental 

value of the property is more than $750,000. 

(D) A transfer of real property owned by the United States 

to another Federal agency or another military department or 

to a State, if the estimated value is more than $750,000. 
1511 § 2662 CH. 159—REAL PROPERTY 

(E) A report of excess real property owned by the United 

States to a disposal agency, if the estimated value is more than 

$750,000. 

(F) Any termination or modification by either the grantor 

or grantee of an existing license or permit of real property 

owned by the United States to a military department, under 

which substantial investments have been or are proposed to be 

made in connection with the use of the property by the military department. 

(G) Any transaction or contract action that results in, or 

includes, the acquisition or use by, or the lease or license to, 

the United States of real property, if the estimated annual 

rental or cost for the use of the real property is more than 

$750,000. 

(2) If a transaction covered by subparagraph (A) or (B) of paragraph (1) is part of a project, the report shall include a summary 

of the general plan for that project, including an estimate of the 

total cost of the lands to be acquired or leases to be made. The report required by this subsection concerning any report of excess 

real property described in subparagraph (E) of paragraph (1) shall 

contain a certification by the Secretary concerned that he has considered the feasibility of exchanging such property for other real 

property authorized to be acquired for military purposes and has 

determined that the property proposed to be declared excess is not 

suitable for such purpose. 

(3) The authority of the Secretary concerned to enter into a 

transaction described in paragraph (1) commences only after— 

(A) the end of the 30-day period beginning on the first day 

of the month with respect to which the report containing the 

facts concerning such transaction, and all other such proposed 

transactions for that month, is submitted under paragraph (1); 

or 

(B) the end of the 14-day period beginning on the first day 

of that month when a copy of the report is provided in an electronic medium pursuant to section 480 of this title on or before 

the first day of that month. 

(4) The report for a month under this subsection may not be 

submitted later than the first day of that month. 

(b) ADDITIONAL REPORTING REQUIREMENTS REGARDING LEASES

OF REAL PROPERTY OWNED BY THE UNITED STATES.—(1) In the case 

of a proposed lease or license of real property owned by the United 

States covered by paragraph (1)(C) of subsection (a), the Secretary 

concerned shall comply with the notice-and-wait requirements of 

paragraph (3) of such subsection before— 

(A) issuing a contract solicitation or other lease offering 

with regard to the transaction; and 

(B) providing public notice regarding any meeting to discuss a proposed contract solicitation with regard to the transaction. 

(2) The report under paragraph (3) of subsection (a) shall include the following with regard to a proposed transaction covered 

by paragraph (1)(C) of such subsection: 

(A) A description of the proposed transaction, including the 

proposed duration of the lease or license. 
§ 2662 CH. 159—REAL PROPERTY 1512 

(B) A description of the authorities to be used in entering 

into the transaction. 

(C) A statement of the scored cost of the entire transaction, 

determined using the scoring criteria of the Office of Management and Budget. 

(D) A determination that the property involved in the 

transaction is not excess property, as required by section 

2667(a)(3) of this title, including the basis for the determination. 

(E) A determination that the proposed transaction is directly compatible with the mission of the military installation 

or Defense Agency at which the property is located and a description of the anticipated long-term use of the property at the 

conclusion of the lease or license. 

(F) A description of the requirements or conditions within 

the contract solicitation or other lease offering for the person 

making the offer to address taxation issues, including payments-in-lieu-of taxes, and other development issues related to 

local municipalities. 

(G) If the proposed lease involves a project related to energy production, a certification by the Secretary of Defense 

that the project, as it will be specified in the contract solicitation or other lease offering, is consistent with the Department 

of Defense performance goals and plan required by section 

2911 of this title. 

(3) The Secretary concerned may not enter into the actual 

lease or license with respect to property for which the information 

required by paragraph (2) was submitted in a report under subsection (a)(3) unless the Secretary again complies with the noticeand-wait requirements of such subsection. The subsequent report 

shall include the following with regard to the proposed transaction: 

(A) A cross reference to the prior report that contained the 

information submitted under paragraph (2) with respect to the 

transaction. 

(B) A description of the differences between the information submitted under paragraph (2) and the information regarding the transaction being submitted in the subsequent report. 

(C) A description of the payment to be required in connection with the lease or license, including a description of any inkind consideration that will be accepted. 

(D) A description of any community support facility or provision of community support services under the lease or license, regardless of whether the facility will be operated by a 

covered entity (as defined in section 2667(d) of this title) or the 

lessee or the services will be provided by a covered entity or 

the lessee. 

(E) A description of the competitive procedures used to select the lessee or, in the case of a lease involving the public 

benefit exception authorized by section 2667(h)(2) of this title, 

a description of the public benefit to be served by the lease. 

(c) EXCEPTED PROJECTS.—This section does not apply to real 

property for water resource development projects of the Corps of 

Engineers, or to leases of Government-owned real property for agri-
1513 § 2662 CH. 159—REAL PROPERTY 

cultural or grazing purposes or to any real property acquisition specifically authorized in a Military Construction Authorization Act. 

(d) STATEMENTS OF COMPLIANCE IN TRANSACTION INSTRU- MENTS.—A statement in an instrument of conveyance, including a 

lease, that the requirements of this section have been met, or that 

the conveyance is not subject to this section, is conclusive. 

(e) REPORTS ON TRANSACTIONS INVOLVING INTELLIGENCE COM- PONENTS.—Whenever a transaction covered by this section is made 

by or on behalf of an intelligence component of the Department of 

Defense or involves real property used by such a component, any 

report under this section with respect to the transaction that is 

submitted to the congressional committees named in subsection (a) 

shall be submitted concurrently to the Permanent Select Committee on Intelligence of the House of Representatives and the Select Committee on Intelligence of the Senate. 

(f) EXCEPTIONS FOR TRANSACTIONS FOR WAR AND CERTAIN

EMERGENCY AND OTHER OPERATIONS.—(1) The reporting requirement set forth in subsection (a) shall not apply with respect to a 

real property transaction otherwise covered by that subsection if 

the Secretary concerned determines that the transaction is made as 

a result of any of the following: 

(A) A declaration of war. 

(B) A declaration of a national emergency by the President 

pursuant to the National Emergencies Act (50 U.S.C. 1601 et 

seq.). 

(C) A declaration of an emergency or major disaster pursuant to the Robert T. Stafford Disaster Relief and Emergency 

Assistance Act (42 U.S.C. 5121 et seq.). 

(D) The use of the militia or the armed forces after a proclamation to disperse under section 334 of this title. 

(E) A contingency operation. 

(2) The reporting requirement set forth in subsection (a) shall 

not apply with respect to a real property transaction otherwise covered by that subsection if the Secretary concerned determines 

that— 

(A) an event listed in paragraph (1) is imminent; and 

(B) the transaction is necessary for purposes of preparation 

for such event. 

(3) Not later than 30 days after entering into a real property 

transaction covered by paragraph (1) or (2), the Secretary concerned shall submit to the committees named in subsection (a) a 

report on the transaction. The report shall set forth any facts or information which would otherwise have been submitted in a report 

on the transaction under subsection (a), but for the operation of 

paragraph (1) or (2). 

(g) SECRETARY CONCERNED DEFINED.—In this section, the term 

‘‘Secretary concerned’’ includes, with respect to Defense Agencies, 

the Secretary of Defense. 

(Aug. 10, 1956, ch. 1041, 70A Stat. 147; Pub. L. 86–70, Sec. 6(c), June 25, 1959, 73 Stat. 142; 

Pub. L. 86–500, title V, Sec. 511(1), June 8, 1960, 74 Stat. 186; Pub. L. 86–624, Sec. 4(c), July 

12, 1960, 74 Stat. 411; Pub. L. 92–145, title VII, Sec. 707(5), Oct. 27, 1971, 85 Stat. 412; Pub. 

L. 92–545, title VII, Sec. 709, Oct. 25, 1972, 86 Stat. 1154; Pub. L. 93–552, title VI, Sec. 610, 

Dec. 27, 1974, 88 Stat. 1765; Pub. L. 94–107, title VI, Sec. 607(5), (6), Oct. 7, 1975, 89 Stat. 

566; Pub. L. 94–431, title VI, Sec. 614, Sept. 30, 1976, 90 Stat. 1367; Pub. L. 96–418, title VIII, 

Sec. 805, Oct. 10, 1980, 94 Stat. 1777; Pub. L. 100–456, div. B, title XXVIII, Sec. 2803, Sept. 

29, 1988, 102 Stat. 2115; Pub. L. 101–510, div. A, title XIII, Sec. 1311(6), Nov. 5, 1990, 104 
§ 2663 CH. 159—REAL PROPERTY 1514 

Stat. 1670; Pub. L. 102–496, title IV, Sec. 403(a)(1), (2)(A), Oct. 24, 1992, 106 Stat. 3185; Pub. 

L. 104–106, div. A, title XV, Sec. 1502(a)(23), div. D, title XLIII, Sec. 4321(b)(21), Feb. 10, 1996, 

110 Stat. 505, 673; Pub. L. 105–261, div. B, title XXVIII, Sec. 2811, Oct. 17, 1998, 112 Stat. 

2204; Pub. L. 106–65, div. A, title X, Sec. 1067(1), Oct. 5, 1999, 113 Stat. 774; Pub. L. 106– 

398, Sec. 1 [div. B, title XXVII, Sec. 2811], Oct. 30, 2000, 114 Stat. 1654, 1654A–416; Pub. L. 

108–136, div. A, title X, Sec. 1031(a)(27), Nov. 24, 2003, 117 Stat. 1598; Pub. L. 108–375, div. 

A, title X, Sec. 1084(d)(22), Oct. 28, 2004, 118 Stat. 2062; Pub. L. 110–181, div. B, title XXVIII, 

Sec. 2821, Jan. 28, 2008, 122 Stat. 543; Pub. L. 110–417, div. B, title XXVIII, Sec. 2811, Oct. 

14, 2008, 122 Stat. 4725; Pub. L. 111–383, div. B, title XXVIII, Sec. 2811(a)–(f), Jan. 7, 2011, 

124 Stat. 4461, 4462.) 

§ 2663. Land acquisition authorities 

(a) ACQUISITION OF LAND BY CONDEMNATION FOR CERTAIN

MILITARY PURPOSES.—(1) Subject to subsection (f), the Secretary of 

a military department may have proceedings brought in the name 

of the United States, in a court of proper jurisdiction, to acquire by 

condemnation any interest in land, including temporary use, needed for— 

(A) the site, construction, or operation of fortifications, 

coast defenses, or military training camps; 

(B) the construction and operation of plants for the production of nitrate and other compounds, and the manufacture of 

explosives or other munitions of war; or 

(C) the development and transmission of power for the operation of plants under subparagraph (B). 

(2) In time of war or when war is imminent, the United States 

may, immediately upon the filing of a petition for condemnation 

under paragraph (1), take and use the land to the extent of the interest sought to be acquired. 

(b) ACQUISITION BY PURCHASE IN LIEU OF CONDEMNATION.— 

The Secretary of the military department concerned may contract 

for or buy any interest in land, including temporary use, needed for 

any purpose named in subsection (a), as soon as the owner fixes 

a price for it and the Secretary considers that price to be reasonable. 

(c) ACQUISITION OF LOW-COST INTERESTS IN LAND.—(1) The 

Secretary of a military department may acquire any interest in 

land that— 

(A) the Secretary determines is needed in the interest of 

national defense; and 

(B) does not cost more than $750,000, exclusive of administrative costs and the amounts of any deficiency judgments. 

(2) The Secretary of a military department may acquire any interest in land that— 

(A) the Secretary determines is needed solely to correct a 

deficiency that is life-threatening, health-threatening, or safety-threatening; and 

(B) does not cost more than $1,500,000, exclusive of administrative costs and the amounts of any deficiency judgments. 

(3) This subsection does not apply to the acquisition, as a part 

of the same project, of more than one parcel of land unless the parcels are noncontiguous, or, if contiguous, unless the total cost is not 

more than 750,000, in the case of an acquisition under paragraph 

(1), or $1,500,000, in the case of an acquisition under paragraph 

(2). 
1515 § 2663 CH. 159—REAL PROPERTY 

(4) Appropriations available to the Department of Defense for 

operation and maintenance or construction may be used for the acquisition of land or interests in land under this subsection. 

(d) ACQUISITION OF INTERESTS IN LAND WHEN NEED IS UR- GENT.—(1) The Secretary of a military department may acquire any 

interest in land in any case in which the Secretary determines 

that— 

(A) the acquisition is needed in the interest of national defense; 

(B) the acquisition is required to maintain the operational 

integrity of a military installation; and 

(C) considerations of urgency do not permit the delay necessary to include the required acquisition in an annual Military Construction Authorization Act. 

(2) Not later than 10 days after the date on which the Secretary of a military department determines to acquire an interest 

in land under the authority of this subsection, the Secretary shall 

submit to the Committee on Armed Services of the Senate and the 

Committee on Armed Services of the House of Representatives 

written notice containing a description of the property and interest 

to be acquired and the reasons for the acquisition. 

(3) Appropriations available for military construction may be 

used for the purposes of this subsection. 

(e) SURVEY AUTHORITY; ACQUISITION METHODS.—Authority 

provided the Secretary of a military department by law to acquire 

an interest in real property (including a temporary interest) includes authority— 

(1) to make surveys; and 

(2) to acquire the interest in real property by gift, purchase, exchange of real property owned by the United States, 

or otherwise. 

(f) ADVANCE NOTICE OF USE OF CONDEMNATION.—(1) Before 

commencing any legal proceeding to acquire any interest in land 

under subsection (a), including acquisition for temporary use, by 

condemnation, eminent domain, or seizure, the Secretary of the 

military department concerned shall— 

(A) pursue, to the maximum extent practicable, all other 

available options for the acquisition or use of the land, such as 

the purchase of an easement or the execution of a land exchange; and 

(B) submit to the congressional defense committees a report containing— 

(i) a description of the land to be acquired; 

(ii) a certification that negotiations with the owner or 

owners of the land occurred, and that the Secretary tendered consideration in an amount equal to the fair market 

value of the land, as determined by the Secretary; and 

(iii) an explanation of the other approaches considered 

for acquiring use of the land, the reasons for the acquisition of the land, and the reasons why alternative acquisition strategies are inadequate. 

(2) The Secretary concerned may have proceedings brought in 

the name of the United States to acquire the land after the end of 

the 21-day period beginning on the date on which the report is re-
§ 2664 CH. 159—REAL PROPERTY 1516 

ceived by the committees or, if over sooner, the end of the 14-day 

period beginning on the date on which a copy of the report is provided in an electronic medium pursuant to section 480 of this title. 

(g) EXCEPTION TO ADVANCE NOTICE REQUIREMENT.—If the Secretary of a military department determines that the use of condemnation, eminent domain, or seizure to acquire an interest in 

land is required under subsection (a) to satisfy a requirement vital 

to national security, and that any delay would be detrimental to 

national security or the protection of health, safety, or the environment, the Secretary may have proceedings brought in the name of 

the United States to acquire the land in advance of submitting the 

report required by subsection (f)(1)(B). However, the Secretary 

shall submit the report not later than seven days after commencement of the legal proceedings with respect to the land. 

(h) LAND ACQUISITION OPTIONS IN ADVANCE OF MILITARY CONSTRUCTION PROJECTS.—(1) The Secretary of a military department 

may acquire an option on a parcel of real property before or after 

its acquisition is authorized by law, if the Secretary considers it 

suitable and likely to be needed for a military project of the military department under the jurisdiction of the Secretary. 

(2) As consideration for an option acquired under paragraph 

(1), the Secretary may pay, from funds available to the military department under the jurisdiction of the Secretary for real property 

activities, an amount that is not more than 12 percent of the appraised fair market value of the property. 

(Aug. 10, 1956, ch. 1041, 70A Stat. 147; Pub. L. 85–861, Sec. 33(a)(14), Sept. 2, 1958, 72 Stat. 

1565; Pub. L. 109–163, div. B, title XXVIII, Sec. 2821(a), Jan. 6, 2006, 119 Stat. 3511; Pub. L. 

109–364, div. B, title XXVIII, Sec. 2821(b), Oct. 17, 2006, 120 Stat. 2474; Pub. L. 110–181, div. 

B, title XXVIII, Sec. 2822(a), Jan. 28, 2008, 122 Stat. 544; Pub. L. 111–383, div. A, title X, Sec. 

1075(g)(6), Jan. 7, 2011, 124 Stat. 4377.) 

§ 2664. Limitations on real property acquisition 

(a) AUTHORIZATION FOR ACQUISITION REQUIRED.—No military 

department may acquire real property not owned by the United 

States unless the acquisition is expressly authorized by law. The 

foregoing limitation shall not apply to the acceptance by a military 

department of real property acquired under the authority of the 

Administrator of General Services to acquire property by the exchange of Government property pursuant to subtitle I of title 40 

and division C (except sections 3302, 3501(b), 3509, 3906, 4710, 

and 4711) of subtitle I of title 41. 

(b) COMMISSIONS ON LAND PURCHASE CONTRACTS.—The maximum amount payable as a commission on a contract for the purchase of land from funds appropriated for the Department of Defense is two percent of the purchase price. 

(c) COST LIMITATIONS.—(1) Except as provided in paragraph 

(2), the cost authorized for a land acquisition project may be increased by not more than 25 percent of the amount appropriated 

for the project by Congress or 200 percent of the amount specified 

by law as the maximum amount for a minor military construction 

project, whichever is lesser, if the Secretary concerned determines 

(A) that such an increase is required for the sole purpose of meeting unusual variations in cost, and (B) that such variations in cost 

could not have been reasonably anticipated at the time the project 

was originally approved by Congress. 
1517 § 2665 CH. 159—REAL PROPERTY 

(2) Until subsection (d) is complied with, a land acquisition 

project may not be placed under contract if, based upon the agreed 

price for the land or, in the case of land to be acquired by condemnation, the amount to be deposited with the court as just compensation for the land— 

(A) the scope of the acquisition, as approved by Congress, 

is proposed to be reduced by more than 25 percent; or 

(B) the agreed price for the land or, in the case of land to 

be acquired by condemnation, the amount to be deposited with 

the court as just compensation for the land, exceeds the 

amount appropriated for the project by more than (i) 25 percent, or (ii) 200 percent of the amount specified by law as the 

maximum amount for a minor military construction project, 

whichever is lesser. 

(d) CONGRESSIONAL NOTIFICATION.—The limitations on reduction in scope or increase in cost of a land acquisition in subsection 

(c) do not apply if the reduction in scope or the increase in cost, 

as the case may be, is approved by the Secretary concerned and a 

written notification of the facts relating to the proposed reduced 

scope or increased cost (including a statement of the reasons therefor) is submitted by the Secretary concerned to the congressional 

defense committees. A contract for the acquisition may then be 

awarded only after a period of 21 days elapses from the date the 

notification is received by the committees or, if over sooner, a period of 14 days elapses from the date on which a copy of that notification is provided in an electronic medium pursuant to section 480 

of this title. 

(e) PAYMENT OF JUDGEMENTS AND SETTLEMENTS.—The Secretary concerned shall promptly pay any deficiency judgment 

against the United States awarded by a court in an action for condemnation of any interest in land or resulting from a final settlement of an action for condemnation of any interest in land. Payments under this subsection may be made from funds available to 

the Secretary concerned for military construction projects and without regard to the limitations of subsections (c) and (d). 

(Added Pub. L. 85–861, Sec. 1(51), Sept. 2, 1958, 72 Stat. 1460, Sec. 2676; amended Pub. L. 

93–166, title VI, Sec. 608(2), Nov. 29, 1973, 87 Stat. 682; Pub. L. 97–214, Sec. 5, July 12, 1982, 

96 Stat. 170; Pub. L. 98–407, title VIII, Sec. 802, Aug. 28, 1984, 98 Stat. 1519; Pub. L. 99–661, 

div. A, title XIII, Sec. 1343(a)(17)(A), Nov. 14, 1986, 100 Stat. 3993; Pub. L. 102–190, div. B, 

title XXVIII, Sec. 2870(1), Dec. 5, 1991, 105 Stat. 1562; Pub. L. 107–217, Sec. 3(b)(14), Aug. 21, 

2002, 116 Stat. 1296; Pub. L. 107–314, div. A, title X, Sec. 1062(a)(11), Dec. 2, 2002, 116 Stat. 

2650; Pub. L. 108–136, div. A, title X, Sec. 1031(a)(30), Nov. 24, 2003, 117 Stat. 1600; Pub. L. 

108–375, div. A, title X, Sec. 1084(b)(4), Oct. 28, 2004, 118 Stat. 2061; renumbered Sec. 2664 

and amended Pub. L. 109–163, div. B, title XXVIII, Sec. 2821(a)(10), (b)–(d), Jan. 6, 2006, 119 

Stat. 3512; Pub. L. 111–350, Sec. 5(b)(45), Jan. 4, 2011, 124 Stat. 3846.) 

§ 2665. Sale of certain interests in land; logs 

(a) The President, through an executive department, may sell 

to any person or foreign government any interest in land that is 

acquired for the production of lumber or timber products, except 

land under the control of the Department of the Army or the Department of the Air Force. 

(b) The President, through an executive department, may sell 

to any person or foreign government any forest products produced 

on land owned or leased by a military department or the Department in which the Coast Guard is operating. 
§ 2665 CH. 159—REAL PROPERTY 1518 

(c) Sales under subsection (a) or (b) shall be at prices determined by the President acting through the selling agency. 

(d) Appropriations of the Department of Defense may be reimbursed for all costs of production of forest products pursuant to this 

section from amounts received as proceeds from the sale of any 

such property. 

(e)(1) Each State in which is located a military installation or 

facility from which forest products are sold in a fiscal year is entitled at the end of such year to an amount equal to 40 percent of 

(A) the amount received by the United States during such year as 

proceeds from the sale of forest products produced on such installation or facility, less (B) the amount of reimbursement of appropriations of the Department of Defense under subsection (d) during 

such year attributable to such installation or facility. 

(2) The amount paid to a State pursuant to paragraph (1) shall 

be expended as the State legislature may prescribe for the benefit 

of the public schools and public roads of the county or counties in 

which the military installation or facility is situated. 

(3) In a case in which a military installation or facility is located in more than one State or county, the amount paid pursuant 

to paragraph (1) shall be distributed in a manner proportional to 

the area of such installation or facility in each State or county. 

(f)(1) There is in the Treasury a reserve account administered 

by the Secretary of Defense for the purposes of this section. Balances in the account may be used for costs of the military departments— 

(A) for improvements of forest lands; 

(B) for unanticipated contingencies in the administration 

of forest lands and the production of forest products for which 

other sources of funds are not available in a timely manner; 

and 

(C) for natural resources management that implements approved plans and agreements. 

(2) There shall be deposited into the reserve account the total 

amount received by the United States as proceeds from the sale of 

forest products sold under subsections (a) and (b) less— 

(A) reimbursements of appropriations made under subsection (d), and 

(B) payments made to States under subsection (e). 

(3) The reserve account may not exceed $4,000,000 on December 31 of any calendar year. Unobligated balances exceeding 

$4,000,000 on that date shall be deposited into the United States 

Treasury. 

(Aug. 10, 1956, ch. 1041, 70A Stat. 149; Aug. 1, 1977, Pub. L. 95–82, title VI, Sec. 610, 91 Stat. 

378; Dec. 12, 1980, Pub. L. 96–513, title V, Sec. 511(91), 94 Stat. 2928; Aug. 6, 1981, Pub. L. 

97–31, Sec. 12(3)(B), 95 Stat. 153; Dec. 23, 1981, Pub. L. 97–99, title IX, Sec. 910(a), 95 Stat. 

1386; Oct. 12, 1982, Pub. L. 97–295, Sec. 1(33), 96 Stat. 1296; Aug. 28, 1984, Pub. L. 98–407, 

title VIII, Sec. 809(a), 98 Stat. 1522; Pub. L. 99–561, Sec. 4, Oct. 27, 1986, 100 Stat. 3151; Pub. 

L. 107–296, title XVII, Sec. 1704(b)(4), Nov. 25, 2002, 116 Stat. 2314; Pub. L. 109–163, div. A, 

title X, Sec. 1056(c)(6), Jan. 6, 2006, 119 Stat. 3439.) 
1519 § 2667 CH. 159—REAL PROPERTY 

[§ 2666. Repealed. Pub. L. 108–375, div. B, title XXVIII, Sec. 

2821(a)(2), Oct. 28, 2004, 118 Stat. 2129] 

§ 2667. Leases: non-excess property of military departments 

and Defense Agencies 

(a) LEASE AUTHORITY.—Whenever the Secretary concerned considers it advantageous to the United States, the Secretary concerned may lease to such lessee and upon such terms as the Secretary concerned considers will promote the national defense or to 

be in the public interest, real or personal property that— 

(1) is under the control of the Secretary concerned; 

(2) is not for the time needed for public use; and 

(3) is not excess property, as defined by section 102 of title 

40. 

(b) CONDITIONS ON LEASES.—A lease under subsection (a)— 

(1) may not be for more than five years, unless the Secretary concerned determines that a lease for a longer period 

will promote the national defense or be in the public interest; 

(2) may give the lessee the first right to buy the property 

if the lease is revoked to allow the United States to sell the 

property under any other provision of law; 

(3) shall permit the Secretary to revoke the lease at any 

time, unless he determines that the omission of such a provision will promote the national defense or be in the public interest; 

(4) shall provide for the payment (in cash or in kind) by 

the lessee of consideration in an amount that is not less than 

the fair market value of the lease interest, as determined by 

the Secretary; 

(5) may provide, notwithstanding section 1302 of title 40 

or any other provision of law, for the alteration, repair, or improvement, by the lessee, of the property leased as the payment of part or all of the consideration for the lease; 

(6) except as otherwise provided in subsection (d), shall require the lessee to provide the covered entities specified in 

paragraph (1) of that subsection the right to establish and operate a community support facility or provide community support services, or seek equitable compensation for morale, welfare, and recreation programs of the Department of Defense in 

lieu of the operation of such a facility or the provision of such 

services, if the Secretary determines that the lessee will provide merchandise or services in direct competition with covered 

entities through the lease; and 

(7) may not provide for a leaseback by the Secretary concerned with an annual payment in excess of $500,000, or otherwise commit the Secretary concerned or the Department of Defense to annual payments in excess of such amount. 

(c) TYPES OF IN-KIND CONSIDERATION.—(1) In addition to any 

in-kind consideration accepted under subsection (b)(5), in-kind consideration accepted with respect to a lease under this section may 

include the following: 

(A) Maintenance, protection, alteration, repair, improvement, or restoration (including environmental restoration) of 
§ 2667 CH. 159—REAL PROPERTY 1520 

property or facilities under the control of the Secretary concerned. 

(B) Construction of new facilities for the Secretary concerned. 

(C) Provision of facilities for use by the Secretary concerned. 

(D) Provision or payment of utility services for the Secretary concerned. 

(E) Provision of real property maintenance services for the 

Secretary concerned. 

(F) Provision of such other services relating to activities 

that will occur on the leased property as the Secretary concerned considers appropriate. 

(2) In-kind consideration under paragraph (1) may be accepted 

at any property or facilities under the control of the Secretary concerned that are selected for that purpose by the Secretary concerned. 

(3) Sections 2662 and 2802 of this title shall not apply to any 

new facilities whose construction is accepted as in-kind consideration under this subsection. 

(d) COMMUNITY SUPPORT FACILITIES AND COMMUNITY SUPPORT

SERVICES UNDER LEASE; WAIVER.—(1) In this subsection and subsection (b)(6), the term ‘‘covered entity’’ means each of the following: 

(A) The Army and Air Force Exchange Service. 

(B) The Navy Exchange Service Command. 

(C) The Marine Corps exchanges. 

(D) The Defense Commissary Agency. 

(E) The revenue-generating nonappropriated fund activities of the Department of Defense conducted for the morale, 

welfare, and recreation of members of the armed forces. 

(2) The Secretary concerned may waive the requirement in 

subsection (b)(6) with respect to a lease if— 

(A) the lease is entered into under subsection (g); or 

(B) the Secretary determines that the waiver is in the best 

interests of the Government. 

(3) The Secretary concerned shall provide to the congressional 

defense committees written notice of each waiver under paragraph 

(2), including the reasons for the waiver. 

(4) The covered entities shall exercise the right provided in 

subsection (b)(6) with respect to a lease, if at all, not later than 90 

days after receiving notice from the Secretary concerned regarding 

the opportunity to exercise such right with respect to the lease. The 

Secretary may, at the discretion of the Secretary, extend the period 

under this paragraph for the exercise of the right with respect to 

a lease for such additional period as the Secretary considers appropriate. 

(5) The Secretary of Defense shall prescribe in regulations uniform procedures and criteria for the evaluation of proposals for enhanced use leases involving the operation of community support facilities or the provision of community support services by either a 

lessee under this section or a covered entity. 
1521 § 2667 CH. 159—REAL PROPERTY 

(e) DEPOSIT AND USE OF PROCEEDS.—(1)(A) The Secretary concerned shall deposit in a special account in the Treasury established for that Secretary the following: 

(i) All money rentals received pursuant to leases entered 

into by that Secretary under this section. 

(ii) All proceeds received pursuant to the granting of easements by that Secretary under section 2668 of this title. 

(iii) All proceeds received by that Secretary from authorizing the temporary use of other property under the control of 

that Secretary. 

(B) Subparagraph (A) does not apply to the following proceeds: 

(i) Amounts paid for utilities and services furnished lessees 

by the Secretary concerned pursuant to leases entered into 

under this section. 

(ii) Money rentals referred to in paragraph (3), (4), or (5). 

(C) Subject to subparagraphs (D) and (E), the proceeds deposited in the special account established for the Secretary concerned 

shall be available to the Secretary, in such amounts as provided in 

appropriation Acts, for the following: 

(i) Maintenance, protection, alteration, repair, improvement, or restoration (including environmental restoration) of 

property or facilities. 

(ii) Construction or acquisition of new facilities. 

(iii) Lease of facilities. 

(iv) Payment of utility services. 

(v) Real property maintenance services. 

(D) At least 50 percent of the proceeds deposited in the special 

account established for the Secretary concerned shall be available 

for activities described in subparagraph (C) only at the military installation or Defense Agency location where the proceeds were 

derived. 

(E) If the proceeds deposited in the special account established 

for the Secretary concerned are derived from activities associated 

with a military museum described in section 489(a) of this title, the 

proceeds shall be available for activities described in subparagraph 

(C) only at that museum. 

(2) Payments for utilities and services furnished lessees pursuant to leases entered into under this section shall be credited to the 

appropriation account or working capital fund from which the cost 

of furnishing the utilities and services was paid. 

(3) Money rentals received by the United States directly from 

a lease under this section for agricultural or grazing purposes of 

lands under the control of the Secretary concerned (other than 

lands acquired by the United States for flood control or navigation 

purposes or any related purpose, including the development of hydroelectric power) may be retained and spent by the Secretary concerned in such amounts as the Secretary considers necessary to 

cover the administrative expenses of leasing for such purposes and 

to cover the financing of multiple-land use management programs 

at any installation under the jurisdiction of the Secretary. 

(4) Money rentals received by the United States from a lease 

under subsection (g) at a military installation approved for closure 

or realignment under a base closure law before January 1, 2005, 

shall be deposited into the account established under section 
§ 2667 CH. 159—REAL PROPERTY 1522 

2906(a) of the Defense Base Closure and Realignment Act of 1990 

(part A of title XXIX of Public Law 101–510; 10 U.S.C. 2687 note). 

(5) Money rentals received by the United States from a lease 

under subsection (g) at a military installation approved for closure 

or realignment under a base closure law on or after January 1, 

2005, shall be deposited into the account established under section 

2906A(a) of the Defense Base Closure and Realignment Act of 1990 

(part A of title XXIX of Public Law 101–510; 10 U.S.C. 2687 note). 

(f) TREATMENT OF LESSEE INTEREST IN PROPERTY.—The interest of a lessee of property leased under this section may be taxed 

by State or local governments. A lease under this section shall provide that, if and to the extent that the leased property is later 

made taxable by State or local governments under an Act of Congress, the lease shall be renegotiated. 

(g) SPECIAL RULES FOR BASE CLOSURE AND REALIGNMENT

PROPERTY.—(1) Notwithstanding subsection (a)(2) or subtitle I of 

title 40 and title III of the Federal Property and Administrative 

Services Act of 1949 (to the extent subtitle I and title III are inconsistent with this subsection), pending the final disposition of real 

property and personal property located at a military installation to 

be closed or realigned under a base closure law, the Secretary concerned may lease the property to any individual or entity under 

this subsection if the Secretary determines that such a lease would 

facilitate State or local economic adjustment efforts. 

(2) Notwithstanding subsection (b)(4), the Secretary concerned 

may accept consideration in an amount that is less than the fair 

market value of the lease interest if the Secretary concerned determines that— 

(A) a public interest will be served as a result of the lease; 

and 

(B) the fair market value of the lease is (i) unobtainable, 

or (ii) not compatible with such public benefit. 

(3) Before entering into any lease under this subsection, the 

Secretary shall consult with the Administrator of the Environmental Protection Agency in order to determine whether the environmental condition of the property proposed for leasing is such 

that the lease of the property is advisable. The Secretary and the 

Administrator shall enter into a memorandum of understanding 

setting forth procedures for carrying out the determinations under 

this paragraph. 

(4)(A) Notwithstanding the National Environmental Policy Act 

of 1969 (42 U.S.C. 4321 et seq.), the scope of any environmental 

impact analysis necessary to support an interim lease of property 

under this subsection shall be limited to the environmental consequences of activities authorized under the proposed lease and the 

cumulative impacts of other past, present, and reasonably foreseeable future actions during the period of the proposed lease. 

(B) Interim leases entered into under this subsection shall be 

deemed not to prejudice the final disposal decision with respect to 

the property, even if final disposal of the property is delayed until 

completion of the term of the interim lease. An interim lease under 

this subsection shall not be entered into without prior consultation 

with the redevelopment authority concerned. 
1523 § 2667 CH. 159—REAL PROPERTY 

(C) Subparagraphs (A) and (B) shall not apply to an interim 

lease under this subsection if authorized activities under the lease 

would— 

(i) significantly affect the quality of the human environment; or 

(ii) irreversibly alter the environment in a way that would 

preclude any reasonable disposal alternative of the property 

concerned. 

(h) COMPETITIVE PROCEDURES FOR SELECTION OF CERTAIN LES- SEES; EXCEPTION.—(1) If a proposed lease under subsection (a) involves only personal property, the lease term exceeds one year, or 

the fair market value of the lease interest exceeds $100,000, as determined by the Secretary concerned, the Secretary shall use competitive procedures to select the lessee. 

(2) Paragraph (1) does not apply if the Secretary concerned determines that— 

(A) a public interest will be served as a result of the lease; 

and 

(B) the use of competitive procedures for the selection of 

certain lessees is unobtainable or not compatible with the public benefit served under subparagraph (A). 

(3) Paragraph (1) does not apply to a renewal or extension of 

a lease by the Secretary of the Navy with a selected institution for 

operation of a ship within the University National Oceanographic 

Laboratory System if, under the lease, each of the following applies: 

(A) Use of the ship is restricted to federally supported research programs and to non-Federal uses under specific conditions with approval by the Secretary of the Navy. 

(B) Because of the anticipated value to the Navy of the 

oceanographic research and training that will result from the 

ship’s operation, no monetary lease payments are required 

from the lessee under the initial lease or under any renewal 

or extension. 

(C) The lessee is required to maintain the ship in a good 

state of repair, readiness, and efficient operating condition, 

conform to all applicable regulatory requirements, and assume 

full responsibility for the safety of the ship, its crew, and scientific personnel aboard. 

(i) DEFINITIONS.—In this section: 

(1) The term ‘‘community support facility’’ includes an ancillary supporting facility (as that term is defined in section 

2871(1) of this title). 

(2) The term ‘‘community support services’’ includes revenue-generating food, recreational, lodging support services, 

and resale operations and other retail facilities and services intended to support a community. 

(3) The term ‘‘military installation’’ has the meaning given 

such term in section 2687(e)(1) of this title. 

(4) The term ‘‘Secretary concerned’’ means— 

(A) the Secretary of a military department, with respect to matters concerning that military department; and 

(B) the Secretary of Defense, with respect to matters 

concerning the Defense Agencies. 
[§ 2667a CH. 159—REAL PROPERTY 1524 

(j) EXCLUSION OF CERTAIN LANDS.—This section does not apply 

to oil, mineral, or phosphate lands. 

(Aug. 10, 1956, ch. 1041, 70A Stat. 150; Pub. L. 94–107, title VI, Sec. 607(7), Oct. 7, 1975, 89 

Stat. 566; Pub. L. 94–412, title V, Sec. 501(b), Sept. 14, 1976, 90 Stat. 1258; Pub. L. 96–513, 

title V, Sec. 511(92), Dec. 12, 1980, 94 Stat. 2928; Pub. L. 97–295, Sec. 1(34), Oct. 12, 1982, 

96 Stat. 1296; Pub. L. 97–321, title VIII, Sec. 803, Oct. 15, 1982, 96 Stat. 1572; Pub. L. 101– 

510, div. B, title XXVIII, Sec. 2806, Nov. 5, 1990, 104 Stat. 1787; Pub. L. 102–190, div. B, title 

XXVIII, Sec. 2862, Dec. 5, 1991, 105 Stat. 1559; Pub. L. 102–484, div. B, title XXVIII, Sec. 2851, 

Oct. 23, 1992, 106 Stat. 2625; Pub. L. 103–160, div. B, title XXIX, Sec. 2906, Nov. 30, 1993, 

107 Stat. 1920; Pub. L. 104–106, div. A, title XV, Sec. 1502(a)(1), div. B, title XXVIII, Secs. 

2831(a), 2832, 2833, Feb. 10, 1996, 110 Stat. 502, 558, 559; Pub. L. 105–85, div. A, title III, 

Sec. 361(b)(2), title X, Sec. 1061(a)–(c)(1), Nov. 18, 1997, 111 Stat. 1701, 1891; Pub. L. 105–261, 

div. B, title XXVIII, Sec. 2821, Oct. 17, 1998, 112 Stat. 2208; Pub. L. 106–65, div. A, title X, 

Sec. 1067(1), Oct. 5, 1999, 113 Stat. 774; Pub. L. 106–398, Sec. 1[div. B, title XXVIII, Sec. 

2812(a)–(e)], Oct. 30, 2000, 114 Stat. 1654, 1654A–416 to 1654A–418; Pub. L. 107–107, div. A, 

title X, Sec. 1013, Dec. 28, 2001, 115 Stat. 1212; Pub. L. 107–217, Sec. 3(b)(12), Aug. 21, 2002, 

116 Stat. 1296; Pub. L. 107–314, div. A, title X, Sec. 1041(a)(18), Dec. 2, 2002, 116 Stat. 2645; 

Pub. L. 108–136, div. A, title X, Sec. 1043(b)(15), (c)(3), Nov. 24, 2003, 117 Stat. 1611, 1612; 

Pub. L. 108–178, Sec. 4(b)(4), Dec. 15, 2003, 117 Stat. 2641; Pub. L. 109–364, div. A, title VI, 

Sec. 662, div. B, title XXVIII, Sec. 2831, Oct. 17, 2006, 120 Stat. 2263, 2480; Pub. L. 110–181, 

div. A, title X, Sec. 1063(c)(13), div. B, title XXVIII, Sec. 2823, Jan. 28, 2008, 122 Stat. 323, 

544; Pub. L. 110–417, div. B, title XXVIII, Secs. 2812(a)–(d), (f)(1), 2831, Oct. 14, 2008, 122 Stat. 

4725, 4726, 4728, 4732; Pub. L. 111–84, div. A, title X, Sec. 1073(a)(26), Oct. 28, 2009, 123 Stat. 

2474; Pub. L. 111–350, Sec. 5(b)(44), Jan. 4, 2011, 124 Stat. 3846; Pub. L. 111–383, div. A, title 

X, Sec. 1075(b)(41), div. B, title XXVIII, Secs. 2811(g), 2812, 2813(a), Jan. 7, 2011, 124 Stat. 

4371, 4463.) 

[§ 2667a. Repealed. Pub. L. 110–417, div. B, title XXVIII, Sec. 

2812(e)(1), Oct. 14, 2008, 122 Stat. 4727] 

§ 2668. Easements for rights-of-way 

(a) AUTHORIZED TYPES OF EASEMENTS.—If the Secretary of a 

military department finds that it will not be against the public interest, the Secretary may grant, upon such terms as the Secretary 

considers advisable, easements for rights-of-way over, in, and upon 

public lands permanently withdrawn or reserved for the use of that 

department, and other lands under the Secretary’s control for— 

(1) railroad tracks; 

(2) gas, water, sewer, and oil pipe lines; 

(3) substations for electric power transmission lines and 

pumping stations for gas, water, sewer, and oil pipe lines; 

(4) canals; 

(5) ditches; 

(6) flumes; 

(7) tunnels; 

(8) dams and reservoirs in connection with fish and wildlife programs, fish hatcheries, and other improvements relating 

to fish-culture; 

(9) roads and streets; 

(10) poles and lines for the transmission or distribution of 

electric power; 

(11) poles and lines for the transmission or distribution of 

communications signals (including telephone and telegraph signals); 

(12) structures and facilities for the transmission, reception, and relay of such signals; and 

(13) any other purpose that the Secretary considers advisable. 

(b) LIMITATION ON SIZE OF EASEMENT.—No easement granted 

under this section may include more land than is necessary for the 

easement. 
1525 § 2668a CH. 159—REAL PROPERTY 

(c) TERMINATION.—The Secretary of the military department 

concerned may terminate all or part of any easement granted 

under this section for— 

(1) failure to comply with the terms of the grant; 

(2) nonuse for a two-year period; or 

(3) abandonment. 

(d) NOTICE TO DEPARTMENT OF THE INTERIOR.—Copies of instruments granting easements over public lands under this section 

shall be furnished to the Secretary of the Interior. 

(e) DISPOSITION OF CONSIDERATION.—Subsections (c) and (e) of 

section 2667 of this title shall apply with respect to in-kind consideration and proceeds received by the Secretary of a military department in connection with an easement granted under this section in 

the same manner as such subsections apply to in-kind consideration and money rentals received pursuant to leases entered into 

by that Secretary under such section. 

(Aug. 10, 1956, ch. 1041, 70A Stat. 150; Pub. L. 98–525, title XIV, Sec. 1405(38), Oct. 19, 1984, 

98 Stat. 2624; Pub. L. 104–201, div. B, title XXVIII, Sec. 2861, Sept. 23, 1996, 110 Stat. 2804; 

Pub. L. 106–398, Sec. 1 [div. B, title XXVIII, Sec. 2812(f)(1)], Oct. 30, 2000, 114 Stat. 1654, 

1654A–418; Pub. L. 108–136, div. B, title XXVIII, Sec. 2813(a), Nov. 24, 2003, 117 Stat. 1725; 

Pub. L. 109–163, div. A, title X, Sec. 1057(a)(3), Jan. 6, 2006, 119 Stat. 3440; Pub. L. 109–364, 

div. B, title XXVIII, Sec. 2822(a), (b), Oct. 17, 2006, 120 Stat. 2474, 2475; Pub. L. 110–181, div. 

A, title X, Sec. 1063(a)(14), Jan. 28, 2008, 122 Stat. 322.) 

§ 2668a. Easements: granting restrictive easements in connection with land conveyances 

(a) AUTHORITY TO INCLUDE RESTRICTIVE EASEMENT.—In connection with the conveyance of real property by the Secretary concerned under any provision of law, the Secretary concerned may 

grant an easement to an entity specified in subsection (b) restricting future uses of the conveyed real property for a conservation 

purpose consistent with section 170(h)(4)(A)(iv) of the Internal Revenue Code of 1986 (26 U.S.C. 170(h)(4)(A)(iv)). 

(b) AUTHORIZED RECIPIENTS.—An easement under subsection 

(a) may be granted only to— 

(1) a State or local government; or 

(2) a qualified organization, as that term is defined in section 170(h) of the Internal Revenue Code of 1986 (26 U.S.C. 

170(h)). 

(c) LIMITATIONS ON USE OF EASEMENT AUTHORITY.—An easement under subsection (a) may not be granted unless— 

(1) the proposed recipient of the easement consents to the 

receipt of the easement; 

(2) the Secretary concerned determines that the easement 

is in the public interest and the conservation purpose to be 

promoted by the easement cannot be effectively achieved 

through the application of State law by the State or a local 

government without the grant of restrictive easements; 

(3) the jurisdiction that encompasses the property to be 

subject to the easement authorizes the grant of restrictive 

easements; and 

(4) the Secretary can give or assign to a third party the responsibility for monitoring and enforcing easements granted 

under this section. 

(d) CONSIDERATION.—Easements granted under this section 

shall be without consideration from the recipient. 
[§ 2669 CH. 159—REAL PROPERTY 1526 

(e) ACREAGE LIMITATION.—No easement granted under this 

section may include more land than is necessary for the easement. 

(f) TERMS AND CONDITIONS.—The grant of an easement under 

this section shall be subject to such additional terms and conditions 

as the Secretary concerned considers appropriate to protect the interests of the United States. 

(Added Pub. L. 109–364, div. B, title XXVIII, Sec. 2823(a), Oct. 17, 2006, 120 Stat. 2475.) 

[§ 2669. Repealed. Pub. L. 109–364, div. B, title XXVIII, Sec. 

2822(c), Oct. 17, 2006, 120 Stat. 2475] 

§ 2670. Use of facilities by private organizations; use as polling places 

(a) USE BY RED CROSS.—Under such conditions as he may prescribe, the Secretary of any military department may issue a revocable license to the American National Red Cross to— 

(1) erect and maintain, on any military installation under 

his jurisdiction, buildings for the storage of supplies; or 

(2) use, for the storage of supplies, buildings erected by the 

United States. 

Supplies stored in buildings erected or used under this subsection 

are available to aid the civilian population in a serious national 

disaster. 

(b) USE OF CERTAIN FACILITIES AS POLLING PLACES.—(1) Notwithstanding chapter 29 of title 18 (including sections 592 and 593 

of such title) or any other provision of law, the Secretary of Defense 

or Secretary of a military department may not (except as provided 

in paragraph (3)) prohibit the designation or use of a qualifying facility under the jurisdiction of the Secretary as an official polling 

place for local, State, or Federal elections. 

(2) A Department of Defense facility is a qualifying facility for 

purposes of this subsection if as of December 31, 2000— 

(A) the facility is designated as an official polling place by 

a State or local election official; or 

(B) the facility has been used as such an official polling 

place since January 1, 1996. 

(3) The limitation in paragraph (1) may be waived by the Secretary of Defense or Secretary of the military department concerned with respect to a particular Department of Defense facility 

if the Secretary of Defense or Secretary concerned determines that 

local security conditions require prohibition of the designation or 

use of that facility as an official polling place for any election. 

(c) USE OF SPACE AND EQUIPMENT BY VETERANS SERVICE ORGANIZATIONS.—(1) Upon certification to the Secretary concerned by 

the Secretary of Veterans Affairs, the Secretary concerned shall 

allow accredited, paid, full-time representatives of the organizations named in section 5902 of title 38, or of other organizations 

recognized by the Secretary of Veterans Affairs, to function on military installations under the jurisdiction of the Secretary concerned 

that are on land and from which persons are discharged or released 

from active duty. 

(2) The commanding officer of a military installation allowing 

representatives to function on the installation under paragraph (1) 
1527 § 2671 CH. 159—REAL PROPERTY 

shall allow the representatives to use available space and equipment at the installation. 

(3) This subsection does not authorize the violation of measures of military security. 

(Aug. 10, 1956, ch. 1041, 70A Stat. 151; Dec. 28, 2001, Pub. L. 107–107, div. A, title XVI, Sec. 

1607(a), (b)(1), (2), 115 Stat. 1279, 1280; Pub. L. 108–375, div. B, title XXVIII, Sec. 2821(c)(1), 

(e)(2), Oct. 28, 2004, 118 Stat. 2129, 2130.) 

§ 2671. Military reservations and facilities: hunting, fishing, 

and trapping 

(a) GENERAL REQUIREMENTS FOR HUNTING, FISHING, AND TRAPPING.—The Secretary of Defense shall, with respect to each military installation or facility under the jurisdiction of any military 

department in a State— 

(1) require that all hunting, fishing, and trapping at that 

installation or facility be in accordance with the fish and game 

laws of the State in which it is located; 

(2) require that an appropriate license for hunting, fishing, 

or trapping on that installation or facility be obtained, except 

that with respect to members of the armed forces, such a license may be required only if the State authorizes the issuance 

of a license to a member on active duty for a period of more 

than thirty days at an installation or facility within that State, 

without regard to residence requirements, and upon terms otherwise not less favorable than the terms upon which such a license is issued to residents of that State; and 

(3) develop, subject to safety requirements and military security, and in cooperation with the Governor (or his designee) 

of the State in which the installation or facility is located, procedures under which designated fish and game or conservation 

officials of that State may, at such time and under such conditions as may be agreed upon, have full access to that installation or facility to effect measures for the management, conservation, and harvesting of fish and game resources. 

(b) WAIVER AUTHORITY.—(1) The Secretary of Defense may 

waive or otherwise modify the fish and game laws of a State otherwise applicable under subsection (a)(1) to hunting, fishing, or trapping at a military installation or facility if the Secretary determines that the application of such laws to such hunting, fishing, 

or trapping without modification could result in undesirable consequences for public health or safety at the installation or facility. 

The authority to waive such laws includes the authority to extend, 

but not reduce, the specified season for certain hunting, fishing, or 

trapping. The Secretary may not waive the requirements under 

subsection (a)(2) regarding a license for such hunting, fishing, or 

trapping or any fee imposed by a State to obtain such a license. 

(2) If the Secretary determines that a waiver of fish and game 

laws of a State is appropriate under paragraph (1), the Secretary 

shall provide written notification to the appropriate State officials 

stating the reasons for, and extent of, the waiver. The notification 

shall be provided at least 30 days before implementation of the 

waiver. 

(c) VIOLATIONS.—Whoever is guilty of an act or omission which 

violates a requirement prescribed under subsection (a)(1) or (2), 
[§ 2672 CH. 159—REAL PROPERTY 1528 

which act or omission would be punishable if committed or omitted 

within the jurisdiction of the State in which the installation or facility is located, by the laws thereof in effect at the time of that act 

or omission, is guilty of a like offense and is subject to a like punishment. 

(d) RELATION TO TREATY RIGHTS.—This section does not modify 

any rights granted by the treaty or otherwise to any Indian tribe 

or to the members thereof. 

(e) REGULATIONS.—The Secretary of Defense shall prescribe 

regulations to carry out this section. 

(Added Pub. L. 85–337, Sec. 4(1), Feb. 28, 1958, 72 Stat. 29; amended Pub. L. 107–107, div. 

B, title XXVIII, Sec. 2811, Dec. 28, 2001, 115 Stat. 1307; Pub. L. 109–163, div. A, title X, Sec. 

1057(a)(2), Jan. 6, 2006, 119 Stat. 3440; Pub. L. 111–383, div. A, title X, Sec. 1075(b)(42), Jan. 

7, 2011, 124 Stat. 4371.) 

[§§ 2672, 2672a. Repealed. Pub. L. 109–163, div. B, title 

XXVIII, Sec. 2821(f), Jan. 6, 2006, 119 Stat. 3513] 

[§ 2673. Repealed. Pub. L. 108–375, div. B, title XXVIII, Sec. 

2821(d)(2), Oct. 28, 2004, 118 Stat. 2130] 

§ 2674. Operation and control of Pentagon Reservation and 

defense facilities in National Capital Region 

(a)(1) Jurisdiction, custody, and control over, and responsibility 

for, the operation, maintenance, and management of the Pentagon 

Reservation is transferred to the Secretary of Defense. 

(2) Before March 1 of each year, the Secretary of Defense shall 

transmit to the congressional committees specified in paragraph (3) 

a report on the state of the renovation of the Pentagon Reservation 

and a plan for the renovation work to be conducted in the fiscal 

year beginning in the year in which the report is transmitted. 

(3) The committees referred to in paragraph (2) are— 

(A) the Committee on Armed Services and the Committee 

on Environment and Public Works of the Senate; and 

(B) the Committee on Armed Services and the Committee 

on Transportation and Infrastructure of the House of Representatives. 

(b)(1) The Secretary may appoint military or civilian personnel 

or contract personnel to perform law enforcement and security 

functions for property occupied by, or under the jurisdiction, custody, and control of the Department of Defense, and located in the 

National Capital Region. Such individuals— 

(A) may be armed with appropriate firearms required for 

personal safety and for the proper execution of their duties, 

whether on Department of Defense property or in travel status; 

and 

(B) shall have the same powers (other than the service of 

civil process) as sheriffs and constables upon the property referred to in the first sentence to enforce the laws enacted for 

the protection of persons and property, to prevent breaches of 

the peace and suppress affrays or unlawful assemblies, and to 

enforce any rules or regulations with respect to such property 

prescribed by duly authorized officials. 

(2) For positions for which the permanent duty station is the 

Pentagon Reservation, the Secretary, in his sole and exclusive dis-
1529 § 2674 CH. 159—REAL PROPERTY 

cretion, may without regard to the pay provisions of title 5, fix the 

rates of basic pay for such positions occupied by civilian law enforcement and security personnel appointed under the authority of 

this section so as to place such personnel on a comparable basis 

with personnel of other similar Federal law enforcement and security organizations within the vicinity of the Pentagon Reservation, 

not to exceed the basic pay for personnel performing similar duties 

in the United States Secret Service Uniformed Division or the 

United States Park Police. 

(c)(1) The Secretary may prescribe such rules and regulations 

as the Secretary considers appropriate to ensure the safe, efficient, 

and secure operation of the Pentagon Reservation, including rules 

and regulations necessary to govern the operation and parking of 

motor vehicles on the Pentagon Reservation. 

(2) Any person who violates a rule or regulation prescribed 

under this subsection is liable to the United States for a civil penalty of not more than $1,000. 

(3) Any person who willfully violates any rule or regulation 

prescribed pursuant to this subsection commits a Class B misdemeanor. 

(d) The Secretary of Defense may establish rates and collect 

charges for space, services, protection, maintenance, construction, 

repairs, alterations, or facilities provided at the Pentagon Reservation. 

(e)(1) There is established in the Treasury of the United States 

a revolving fund to be known as the Pentagon Reservation Maintenance Revolving Fund (hereafter in this section referred to as the 

‘‘Fund’’). There shall be deposited into the Fund funds collected by 

the Secretary for space and services and other items provided an 

organization or entity using any facility or land on the Pentagon 

Reservation pursuant to subsection (d). 

(2) Subject to paragraphs (3) and (4), monies deposited into the 

Fund shall be available, without fiscal year limitation, for expenditure for real property management, operation, protection, construction, repair, alteration and related activities for the Pentagon Reservation. 

(3) If the cost of a construction or alteration activity proposed 

to be financed in whole or in part using monies from the Fund will 

exceed the limitation specified in section 2805 of this title for a 

comparable unspecified minor military construction project, the activity shall be subject to authorization as provided by section 2802 

of this title before monies from the Fund are obligated for the activity. 

(4) The authority of the Secretary to use monies from the Fund 

to support construction or alteration activities at the Pentagon Reservation expires on September 30, 2012. 

(f) In this section: 

(1) The term ‘‘Pentagon Reservation’’ means that area of 

land (consisting of approximately 280 acres) and improvements 

thereon, located in Arlington, Virginia, on which the Pentagon 

Office Building, Federal Building Number 2, the Pentagon 

heating and sewage treatment plants, and other related facilities are located, including various areas designated for the 

parking of vehicles. 
§ 2675 CH. 159—REAL PROPERTY 1530 

(2) The term ‘‘National Capital Region’’ means the geographic area located within the boundaries of (A) the District 

of Columbia, (B) Montgomery and Prince Georges Counties in 

the State of Maryland, (C) Arlington, Fairfax, Loudoun, and 

Prince William Counties and the City of Alexandria in the 

Commonwealth of Virginia, and (D) all cities and other units 

of government within the geographic areas of such District, 

Counties, and City. 

(g) For purposes of subsections (b), (c), (d), and (e), the terms 

‘‘Pentagon Reservation’’ and ‘‘National Capital Region’’ shall be 

treated as including the land and physical facilities at the Raven 

Rock Mountain Complex. 

(Added Pub. L. 101–510, div. B, title XXVIII, Sec. 2804(a)(1), Nov. 5, 1990, 104 Stat. 1784; 

amended Pub. L. 102–190, div. A, title X, Sec. 1061(a)(18), div. B, title XXVIII, Sec. 2864, Dec. 

5, 1991, 105 Stat. 1473, 1561; Pub. L. 104–106, div. A, title XV, Sec. 1502(a)(24), Feb. 10, 1996, 

110 Stat. 505; Pub. L. 104–201, div. A, title III, Sec. 369(a), (b)(1), Sept. 23, 1996, 110 Stat. 

2498; Pub. L. 106–65, div. A, title X, Sec. 1067(1), Oct. 5, 1999, 113 Stat. 774; Pub. L. 107– 

107, div. A, title XI, Sec. 1101, Dec. 28, 2001, 115 Stat. 1234; Pub. L. 108–136, div. A, title IX, 

Sec. 933, Nov. 24, 2003, 117 Stat. 1581; Pub. L. 111–383, div. B, title XXVIII, Sec. 2802, Jan. 

7, 2011, 124 Stat. 4458.) 

§ 2675. Leases: foreign countries 

(a) LEASE AUTHORITY; DURATION.—The Secretary of a military 

department may acquire by lease in foreign countries structures 

and real property relating to structures that are needed for military purposes other than for military family housing. A lease under 

this section may be for a period of up to 10 years, or 15 years in 

the case of a lease in Korea, and the rental for each yearly period 

may be paid from funds appropriated to that military department 

for that year. 

(b) AVAILABILITY OF FUNDS.—Appropriations available to the 

Department of Defense for operation and maintenance or construction may be used for the acquisition of interests in land under this 

section. 

(Added Pub. L. 85–861, Sec. 1(51), Sept. 2, 1958, 72 Stat. 1460; amended Pub. L. 91–511, title 

VI, Sec. 608, Oct. 26, 1970, 84 Stat. 1224; Pub. L. 94–107, title VI, Sec. 607(10), (11), Oct. 7, 

1975, 89 Stat. 567; Pub. L. 95–82, title V, Sec. 505(a), Aug. 1, 1977, 91 Stat. 371; Pub. L. 95– 

356, title V, Sec. 503(b), Sept. 8, 1978, 92 Stat. 579; Pub. L. 96–125, title V, Sec. 502(b), Nov. 

26, 1979, 93 Stat. 940; Pub. L. 96–418, title V, Sec. 504(b), Oct. 10, 1980, 94 Stat. 1765; Pub. 

L. 97–99, title VI, Sec. 604, Dec. 23, 1981, 95 Stat. 1374; Pub. L. 97–214, Sec. 8, July 12, 1982, 

96 Stat. 174; Pub. L. 98–525, title XIV, Sec. 1405(40), Oct. 19, 1984, 98 Stat. 2624; Pub. L. 101– 

510, div. A, title XIII, Sec. 1322(a)(11), Nov. 5, 1990, 104 Stat. 1671; Pub. L. 108–136, div. B, 

title XXVIII, Sec. 2804(b), Nov. 24, 2003, 117 Stat. 1719; Pub. L. 108–375, div. B, title XXVIII, 

Sec. 2821(d)(3), Oct. 28, 2004, 118 Stat. 2130; Pub. L. 109–364, div. B, title XXVIII, Sec. 2824, 

Oct. 17, 2006, 120 Stat. 2476.) 

[§ 2676. Renumbered 2664] 

[§ 2677. Repealed. Pub. L. 110–181, div. B, title XXVIII, Sec. 

2822(b)(1), Jan. 28, 2008, 122 Stat. 544] 

§ 2678. Feral horses and burros: removal from military installations 

When feral horses or burros are found on an installation under 

the jurisdiction of the Secretary of a military department, the Secretary may use helicopters and motorized equipment for their removal. 

(Added Pub. L. 101–510, div. A, title XIV, Sec. 1481(h)(1), Nov. 5, 1990, 104 Stat. 1708.) 
1531 § 2681 CH. 159—REAL PROPERTY 

[§ 2679. Repealed. Pub. L. 108–375, div. B, title XXVIII, Sec. 

2821(c)(2), Oct. 28, 2004, 118 Stat. 2129] 

[§ 2680. Repealed. Pub. L. 111–383, div. B, title XXVIII, Sec. 

2814(a), Jan. 7, 2011, 124 Stat. 4464] 

§ 2681. Use of test and evaluation installations by commercial entities 

(a) CONTRACT AUTHORITY.—The Secretary of Defense may 

enter into contracts with commercial entities that desire to conduct 

commercial test and evaluation activities at a Major Range and 

Test Facility Installation. 

(b) TERMINATION OR LIMITATION OF CONTRACT UNDER CERTAIN

CIRCUMSTANCES.—A contract entered into under subsection (a) 

shall contain a provision that the Secretary of Defense may terminate, prohibit, or suspend immediately any commercial test or evaluation activity to be conducted at the Major Range and Test Facility Installation under the contract if the Secretary of Defense certifies in writing that the test or evaluation activity is or would be 

detrimental— 

(1) to the public health and safety; 

(2) to property (either public or private); or 

(3) to any national security interest or foreign policy interest of the United States. 

(c) CONTRACT PRICE.—A contract entered into under subsection 

(a) shall include a provision that requires a commercial entity 

using a Major Range and Test Facility Installation under the contract to reimburse the Department of Defense for all direct costs 

to the United States that are associated with the test and evaluation activities conducted by the commercial entity under the contract. In addition, the contract may include a provision that requires the commercial entity to reimburse the Department of Defense for such indirect costs related to the use of the installation 

as the Secretary of Defense considers to be appropriate. The Secretary may delegate to the commander of the Major Range and 

Test Facility Installation the authority to determine the appropriateness of the amount of indirect costs included in such a contract provision. 

(d) RETENTION OF FUNDS COLLECTED FROM COMMERCIAL

USERS.—Amounts collected under subsection (c) from a commercial 

entity conducting test and evaluation activities at a Major Range 

and Test Facility Installation shall be credited to the appropriation 

accounts under which the costs associated with the test and evaluation activities of the commercial entity were incurred. 

(e) REGULATIONS AND LIMITATIONS.—The Secretary of Defense 

shall prescribe regulations to carry out this section. 

(f) DEFINITIONS.—In this section: 

(1) The term ‘‘Major Range and Test Facility Installation’’ 

means a test and evaluation installation under the jurisdiction 

of the Department of Defense and designated as a Major Range 

and Test Facility Installation by the Secretary. 

(2) The term ‘‘direct costs’’ includes the cost of— 

(A) labor, material, facilities, utilities, equipment, supplies, and any other resources damaged or consumed dur-
§ 2682 CH. 159—REAL PROPERTY 1532 

ing test or evaluation activities or maintained for a particular commercial entity; and 

(B) construction specifically performed for a commercial entity to conduct test and evaluation activities. 

(Added Pub. L. 103–160, div. A, title VIII, Sec. 846(a), Nov. 30, 1993, 107 Stat. 1722; amended 

Pub. L. 105–85, div. A, title VIII, Sec. 842, Nov. 18, 1997, 111 Stat. 1844; Pub. L. 105–261, div. 

A, title VIII, Sec. 820, Oct. 17, 1998, 112 Stat. 2090.) 

§ 2682. Facilities for defense agencies 

The maintenance and repair of a real property facility for an 

activity or agency of the Department of Defense (other than a military department) financed from appropriations for military functions of the Department of Defense will be accomplished by or 

through a military department designated by the Secretary of Defense. A real property facility under the jurisdiction of the Department of Defense which is used by an activity or agency of the Department of Defense (other than a military department) shall be 

under the jurisdiction of a military department designated by the 

Secretary of Defense. 

(Added Pub. L. 88–174, title VI, Sec. 609(a)(1), Nov. 7, 1963, 77 Stat. 329; amended Pub. L. 97– 

214, Sec. 10(a)(7), July 12, 1982, 96 Stat. 175.) 

§ 2683. Relinquishment of legislative jurisdiction; minimum 

drinking age on military installations 

(a) Notwithstanding any other provision of law, the Secretary 

concerned may, whenever he considers it desirable, relinquish to a 

State, or to a Commonwealth, territory, or possession of the United 

States, all or part of the legislative jurisdiction of the United States 

over lands or interests under his control in that State, Commonwealth, territory, or possession. Relinquishment of legislative jurisdiction under this section may be accomplished (1) by filing with 

the Governor (or, if none exists, with the chief executive officer) of 

the State, Commonwealth, territory, or possession concerned a notice of relinquishment to take effect upon acceptance thereof, or (2) 

as the laws of the State, Commonwealth, territory, or possession 

may otherwise provide. 

(b) The authority granted by subsection (a) is in addition to 

and not instead of that granted by any other provision of law. 

(c)(1) Except as provided in paragraphs (2) and (3), the Secretary concerned shall establish and enforce as the minimum 

drinking age on a military installation located in a State the age 

established by the law of that State as the State minimum drinking age. 

(2)(A) In the case of a military installation located— 

(i) in more than one State; or 

(ii) in one State but within 50 miles of another State or 

Mexico or Canada, 

the Secretary concerned may establish and enforce as the minimum drinking age on that military installation the lowest applicable age. 

(B) In subparagraph (A), the term ‘‘lowest applicable age’’ 

means the lowest minimum drinking age established by the law— 

(i) of a State in which a military installation is located; or 

(ii) of a State or jurisdiction of Mexico or Canada that is 

within 50 miles of such military installation. 
1533 § 2684 CH. 159—REAL PROPERTY 

(3)(A) The commanding officer of a military installation may 

waive the requirement of paragraph (1) if such commanding officer 

determines that the exemption is justified by special circumstances. 

(B) The Secretary of Defense shall define by regulations what 

constitute special circumstances for the purposes of this paragraph. 

(4) In this subsection: 

(A) The term ‘‘State’’ includes the District of Columbia. 

(B) The term ‘‘minimum drinking age’’ means the minimum age or ages established for persons who may purchase, 

possess, or consume alcoholic beverages. 

(Added Pub. L. 91–511, title VI, Sec. 613(1), Oct. 26, 1970, 84 Stat. 1226; amended Pub. L. 92– 

545, title VIII, Sec. 707, Oct. 25, 1972, 86 Stat. 1154; Pub. L. 93–283, Sec. 3, May 14, 1974, 

88 Stat. 141; Pub. L. 99–145, title XII, Sec. 1224(a), (b)(1), (c)(1), Nov. 8, 1985, 99 Stat. 728, 

729; Pub. L. 99–661, div. A, title XIII, Sec. 1343(a)(18), Nov. 14, 1986, 100 Stat. 3993; Pub. L. 

100–526, title I, Sec. 106(b)(2), Oct. 24, 1988, 102 Stat. 2625.) 

§ 2684. Cooperative agreements for management of cultural 

resources 

(a) AUTHORITY.—The Secretary of Defense or the Secretary of 

a military department may enter into a cooperative agreement with 

a State or local government or other entity for the preservation, 

management, maintenance, and improvement of cultural resources 

located on a site authorized by subsection (b) and for the conduct 

of research regarding the cultural resources. Activities under the 

cooperative agreement shall be subject to the availability of funds 

to carry out the cooperative agreement. 

(b) AUTHORIZED CULTURAL RESOURCES SITES.—To be covered 

by a cooperative agreement under subsection (a), cultural resources 

must be located— 

(1) on a military installation; or 

(2) on a site outside of a military installation, but only if 

the cooperative agreement will directly relieve or eliminate 

current or anticipated restrictions that would or might restrict, 

impede, or otherwise interfere, whether directly or indirectly, 

with current or anticipated military training, testing, or operations on a military installation. 

(c) APPLICATION OF OTHER LAWS.—Section 1535 and chapter 63 

of title 31 shall not apply to a cooperative agreement entered into 

under this section. 

(d) CULTURAL RESOURCE DEFINED.—In this section, the term 

‘‘cultural resource’’ means any of the following: 

(1) A building, structure, site, district, or object eligible for 

or included in the National Register of Historic Places maintained under section 101(a) of the National Historic Preservation Act (16 U.S.C. 470a(a)). 

(2) Cultural items, as that term is defined in section 2(3) 

of the Native American Graves Protection and Repatriation Act 

(25 U.S.C. 3001(3)). 

(3) An archaeological resource, as that term is defined in 

section 3(1) of the Archaeological Resources Protection Act of 

1979 (16 U.S.C. 470bb(1)). 

(4) An archaeological artifact collection and associated 

records covered by section 79 of title 36, Code of Federal Regulations. 
§ 2684a CH. 159—REAL PROPERTY 1534 

(5) An Indian sacred site, as defined in section 1(b)(iii) of 

Executive Order No. 13007. 

(Added Pub. L. 104–201, div. B, title XXVIII, Sec. 2862(a), Sept. 23, 1996, 110 Stat. 2804; 

amended Pub. L. 105–85, div. A, title X, Sec. 1073(a)(58), Nov. 18, 1997, 111 Stat. 1903; Pub. 

L. 110–181, div. B, title XXVIII, Sec. 2824, Jan. 28, 2008, 122 Stat. 545.) 

§ 2684a. Agreements to limit encroachments and other constraints on military training, testing, and operations 

(a) AGREEMENTS AUTHORIZED.—The Secretary of Defense or 

the Secretary of a military department may enter into an agreement with an eligible entity or entities described in subsection (b) 

to address the use or development of real property in the vicinity 

of, or ecologically related to, a military installation or military airspace for purposes of— 

(1) limiting any development or use of the property that 

would be incompatible with the mission of the installation; or 

(2) preserving habitat on the property in a manner that— 

(A) is compatible with environmental requirements; 

and 

(B) may eliminate or relieve current or anticipated environmental restrictions that would or might otherwise restrict, impede, or otherwise interfere, whether directly or 

indirectly, with current or anticipated military training, 

testing, or operations on the installation. 

(b) ELIGIBLE ENTITIES.—An agreement under this section may 

be entered into with any of the following: 

(1) A State or political subdivision of a State. 

(2) A private entity that has as its stated principal organizational purpose or goal the conservation, restoration, or preservation of land and natural resources, or a similar purpose or 

goal, as determined by the Secretary concerned. 

(c) INAPPLICABILITY OF CERTAIN CONTRACT REQUIREMENTS.— 

Chapter 63 of title 31 shall not apply to any agreement entered 

into under this section. 

(d) ACQUISITION AND ACCEPTANCE OF PROPERTY AND INTERESTS.—(1) An agreement with an eligible entity or entities under 

this section shall provide for— 

(A) the acquisition by the entity or entities of all right, 

title, and interest in and to any real property, or any lesser interest in the property, as may be appropriate for purposes of 

this section; and 

(B) the sharing by the United States and the entity or entities of the acquisition costs in accordance with paragraph (3). 

(2) Property or interests may not be acquired pursuant to the 

agreement unless the owner of the property or interests consents 

to the acquisition. 

(3) An agreement with an eligible entity under this section 

may provide for the management of natural resources on real property in which the Secretary concerned acquires any right, title, or 

interest in accordance with this subsection and for the payment by 

the United States of all or a portion of the costs of such natural 

resource management if the Secretary concerned determines that 
1535 § 2684a CH. 159—REAL PROPERTY 

there is a demonstrated need to preserve or restore habitat for the 

purpose described in subsection (a)(2). 

(4)(A) The Secretary concerned shall determine the appropriate 

portion of the acquisition costs to be borne by the United States in 

the sharing of acquisition costs of real property, or an interest in 

real property, under paragraph (1)(B). 

(B) In lieu of or in addition to making a monetary contribution 

toward the cost of acquiring a parcel of real property, or an interest 

therein, pursuant to an agreement under this section, the Secretary concerned may convey, using the authority provided by section 2869 of this title, real property described in paragraph (2) of 

subsection (a) of such section, subject to the limitation in paragraph (3) of such subsection. 

(C) The portion of acquisition costs borne by the United States 

under subparagraph (A), either through the contribution of funds 

or excess real property, or both, may not exceed an amount equal 

to, at the discretion of the Secretary concerned— 

(i) the fair market value of any property or interest in 

property to be transferred to the United States upon the request of the Secretary concerned under paragraph (5); or 

(ii) the cumulative fair market value of all properties or interests to be transferred to the United States under paragraph 

(5) pursuant to an agreement under subsection (a). 

(D) The portion of acquisition costs borne by the United States 

under subparagraph (A) may exceed the amount determined under 

subparagraph (C), but only if— 

(i) the Secretary concerned provides written notice to the 

Committee on Armed Services of the Senate and the Committee on Armed Services of the House of Representatives containing— 

(I) a certification by the Secretary that the military 

value to the United States of the property or interest to be 

acquired justifies a payment in excess of the fair market 

value of the property or interest; and 

(II) a description of the military value to be obtained; 

and 

(ii) the contribution toward the acquisition costs of the 

property or interest is not made until at least 14 days after the 

date on which the notice is submitted under clause (i) or, if 

earlier, at least 10 days after the date on which a copy of the 

notice is provided in an electronic medium pursuant to section 

480 of this title. 

(E) The contribution of an entity or entities to the acquisition 

costs of real property, or an interest in real property, under paragraph (1)(B) may include, with the approval of the Secretary concerned, the following or any combination of the following: 

(i) The provision of funds, including funds received by such 

entity or entities from a Federal agency outside the Department of Defense or a State or local government in connection 

with a Federal, State, or local program. 

(ii) The provision of in-kind services, including services related to the acquisition or maintenance of such real property 

or interest in real property. 
§ 2684a CH. 159—REAL PROPERTY 1536 

(iii) The exchange or donation of real property or any interest in real property. 

(5) The agreement shall require the entity or entities to transfer to the United States, upon the request of the Secretary concerned, all or a portion of the property or interest acquired under 

the agreement or a lesser interest therein. The Secretary shall 

limit such transfer request to the minimum property or interests 

necessary to ensure that the property concerned is developed and 

used in a manner appropriate for purposes of this section. 

(6) The Secretary concerned may accept on behalf of the United 

States any property or interest to be transferred to the United 

States under the agreement. 

(7) For purposes of the acceptance of property or interests 

under the agreement, the Secretary concerned may accept an appraisal or title documents prepared or adopted by a non-Federal 

entity as satisfying the applicable requirements of section 301 of 

the Uniform Relocation Assistance and Real Property Acquisition 

Policies Act of 1970 (42 U.S.C. 4651) or section 3111 of title 40, if 

the Secretary concerned finds that the appraisal or title documents 

substantially comply with the requirements. 

(e) ACQUISITION OF WATER RIGHTS.—The authority of the Secretary concerned to enter into an agreement under this section for 

the acquisition of real property (or an interest therein) includes the 

authority to support the purchase of water rights from any available source when necessary to support or protect the mission of a 

military installation. 

(f) ADDITIONAL TERMS AND CONDITIONS.—The Secretary concerned may require such additional terms and conditions in an 

agreement under this section as the Secretary considers appropriate to protect the interests of the United States. 

(g) ANNUAL REPORTS.—(1) Not later than March 1 each year, 

the Secretary of Defense shall, in coordination with the Secretaries 

of the military departments and the Director of the Department of 

Defense Test Resource Management Center, submit to the Committees on Armed Services of the Senate and the House of Representatives a report on the projects undertaken under agreements under 

this section. 

(2) Each report under paragraph (1) shall include the following: 

(A) A description of the status of the projects undertaken 

under agreements under this section. 

(B) An assessment of the effectiveness of such projects, and 

other actions taken pursuant to this section, as part of a longterm strategy to ensure the sustainability of military test and 

training ranges, military installations, and associated airspace. 

(C) An evaluation of the methodology and criteria used to 

select, and to establish priorities, for projects undertaken 

under agreements under this section. 

(D) A description of any sharing of costs by the United 

States and eligible entities under subsection (d) during the preceding year, including a description of each agreement under 

this section providing for the sharing of such costs and a statement of the eligible entity or entities with which the United 

States is sharing such costs. 
1537 § 2685 CH. 159—REAL PROPERTY 

(E) Such recommendations as the Secretary of Defense 

considers appropriate for legislative or administrative action in 

order to improve the efficiency and effectiveness of actions 

taken pursuant to agreements under this section. 

(h) FUNDING.—(1) Except as provided in paragraph (2), funds 

authorized to be appropriated for operation and maintenance of the 

Army, Navy, Marine Corps, Air Force, or Defense-wide activities 

may be used to enter into agreements under this section. 

(2) In the case of a military installation operated primarily 

with funds authorized to be appropriated for research, development, test, and evaluation, funds authorized to be appropriated for 

the Army, Navy, Marine Corps, Air Force, or Defense-wide activities for research, development, test, and evaluation may be used to 

enter into agreements under this section with respect to the installation. 

(i) DEFINITIONS.—In this section: 

(1) The term ‘‘Secretary concerned’’ means the Secretary of 

Defense or the Secretary of a military department. 

(2) The term ‘‘State’’ includes the District of Columbia, the 

Commonwealth of Puerto Rico, the Commonwealth of the 

Northern Marianas, and the territories and possessions of the 

United States. 

(Added Pub. L. 107–314, div. B, title XXVIII, Sec. 2811(a), Dec. 2, 2002, 116 Stat. 2705; amended Pub. L. 109–163, div. B, title XXVIII, Sec. 2822, Jan. 6, 2006, 119 Stat. 3513; Pub. L. 109– 

364, div. B, title XXVIII, Sec. 2811(g), Oct. 17, 2006, 120 Stat. 2473; Pub. L. 110–181, div. B, 

title XXVIII, Sec. 2825, Jan. 28, 2008, 122 Stat. 545; Pub. L. 111–84, div. A, title X, Sec. 

1073(a)(27), Oct. 28, 2009, 123 Stat. 2474; Pub. L. 111–383, div. A, title X, Sec. 1075(b)(43), Jan. 

7, 2011, 124 Stat. 4371.) 

§ 2685. Adjustment of or surcharge on selling prices in commissary stores to provide funds for construction 

and improvement of commissary store facilities 

(a) ADJUSTMENT OR SURCHARGE AUTHORIZED.—Notwithstanding any other provision of law, the Secretary of Defense may, 

for the purposes of this section, provide for an adjustment of, or 

surcharge on, sales prices of goods and services sold in commissary 

store facilities. 

(b) USE FOR CONSTRUCTION, REPAIR, IMPROVEMENT, AND MAINTENANCE.—(1) The Secretary of Defense may use the proceeds from 

the adjustments or surcharges authorized by subsection (a) only— 

(A) to acquire (including acquisition by lease), construct, 

convert, expand, improve, repair, maintain, and equip the 

physical infrastructure of commissary stores and central product processing facilities of the defense commissary system; and 

(B) to cover environmental evaluation and construction 

costs related to activities described in paragraph (1), including 

costs for surveys, administration, overhead, planning, and design. 

(2) In paragraph (1), the term ‘‘physical infrastructure’’ includes real property, utilities, and equipment (installed and free 

standing and including computer equipment), necessary to provide 

a complete and usable commissary store or central product processing facility. 

(c) ADVANCE OBLIGATION.—The Secretary of Defense, with the 

approval of the Director of the Office of Management and Budget, 
§ 2686 CH. 159—REAL PROPERTY 1538 

may obligate anticipated proceeds from the adjustments or surcharges authorized by subsection (a) for any use specified in subsection (b) or (d), without regard to fiscal year limitations, if the 

Secretary determines that such obligation is necessary to carry out 

any use of such adjustments or surcharges specified in subsection 

(b) or (d). 

(d) COOPERATION WITH NONAPPROPRIATED FUND INSTRUMEN- TALITIES.—(1) The Secretary of Defense may authorize a nonappropriated fund instrumentality of the United States to enter 

into a contract for construction of a shopping mall or similar facility for a commissary store and one or more nonappropriated fund 

instrumentality activities. The Secretary may use the proceeds of 

adjustments or surcharges authorized by subsection (a) to reimburse the nonappropriated fund instrumentality for the portion of 

the cost of the contract that is attributable to construction of the 

commissary store or to pay the contractor directly for that portion 

of such cost. 

(2) In paragraph (1), the term ‘‘construction’’, with respect to 

a facility, includes acquisition, conversion, expansion, installation, 

or other improvement of the facility. 

(e) OTHER SOURCES OF FUNDS FOR CONSTRUCTION AND IMPROVEMENTS.—Revenues received by the Secretary of Defense from 

the following sources or activities of commissary store facilities 

shall be available for the purposes set forth in subsections (b), (c), 

and (d): 

(1) Sale of recyclable materials. 

(2) Sale of excess and surplus property. 

(3) License fees. 

(4) Royalties. 

(5) Fees paid by sources of products in order to obtain favorable display of the products for resale, known as business 

related management fees. 

(Added Pub. L. 93–552, title VI, Sec. 611, Dec. 27, 1974, 88 Stat. 1765; amended Pub. L. 95– 

82, title VI, Sec. 614, Aug. 1, 1977, 91 Stat. 380; Pub. L. 97–321, title VIII, Sec. 804, Oct. 15, 

1982, 96 Stat. 1572; Pub. L. 103–337, div. B, title XXVIII, Sec. 2851, Oct. 5, 1994, 108 Stat. 

3072; Pub. L. 105–85, div. A, title III, Sec. 374, Nov. 18, 1997, 111 Stat. 1707; Pub. L. 106– 

398, Sec. 1 [[div. A], title III, Sec. 333(a), (b)], Oct. 30, 2000, 114 Stat. 1654, 1654A–60.) 

§ 2686. Utilities and services: sale; expansion and extension 

of systems and facilities 

(a) Under such regulations and for such periods and at such 

prices as he may prescribe, the Secretary concerned or his designee 

may sell or contract to sell to purchasers within or in the immediate vicinity of an activity of the Army, Navy, Air Force, Marine 

Corps, or Coast Guard, as the case may be, any of the following 

utilities and related services, if it is determined that they are not 

available from another local source and that the sale is in the interest of national defense or in the public interest: 

(1) Electric power. 

(2) Steam. 

(3) Compressed air. 

(4) Water. 

(5) Sewage and garbage disposal. 

(6) Natural, manufactured, or mixed gas. 

(7) Ice. 
1539 § 2687 CH. 159—REAL PROPERTY 

(8) Mechanical refrigeration. 

(9) Telephone service. 

(b) Proceeds of sales under subsection (a) shall be credited to 

the appropriation currently available for the supply of that utility 

or service. 

(c) To meet local needs the Secretary concerned may make 

minor expansions and extensions of any distributing system or facility within an activity through which a utility or service is furnished under subsection (a). 

(Aug. 10, 1956, ch. 1041, 70A Stat. 141, Sec. 2481; Pub. L. 86–156, Aug. 14, 1959, 73 Stat. 338; 

renumbered Sec. 2686, Pub. L. 105–85, div. A, title III, Sec. 371(b)(1), Nov. 18, 1997, 111 Stat. 

1705.) 

§ 2687. Base closures and realignments 

(a) Notwithstanding any other provision of law, no action may 

be taken to effect or implement— 

(1) the closure of any military installation at which at least 

300 civilian personnel are authorized to be employed; 

(2) any realignment with respect to any military installation referred to in paragraph (1) involving a reduction by more 

than 1,000, or by more than 50 percent, in the number of civilian personnel authorized to be employed at such military installation at the time the Secretary of Defense or the Secretary 

of the military department concerned notifies the Congress 

under subsection (b) of the Secretary’s plan to close or realign 

such installation; or 

(3) any construction, conversion, or rehabilitation at any 

military facility other than a military installation referred to 

in clause (1) or (2) which will or may be required as a result 

of the relocation of civilian personnel to such facility by reason 

of any closure or realignment to which clause (1) or (2) applies, 

unless and until the provisions of subsection (b) are complied with. 

(b) No action described in subsection (a) with respect to the closure of, or a realignment with respect to, any military installation 

referred to in such subsection may be taken unless and until— 

(1) the Secretary of Defense or the Secretary of the military department concerned notifies the Committee on Armed 

Services of the Senate and the Committee on Armed Services 

of the House of Representatives, as part of an annual request 

for authorization of appropriations to such Committees, of the 

proposed closing or realignment and submits with the notification an evaluation of the fiscal, local economic, budgetary, environmental, strategic, and operational consequences of such closure or realignment; and 

(2) a period of 30 legislative days or 60 calendar days, 

whichever is longer, expires following the day on which the notice and evaluation referred to in clause (1) have been submitted to such committees, during which period no irrevocable 

action may be taken to effect or implement the decision. 

(c) This section shall not apply to the closure of a military installation, or a realignment with respect to a military installation, 

if the President certifies to the Congress that such closure or realignment must be implemented for reasons of national security or 

a military emergency. 
§ 2687a CH. 159—REAL PROPERTY 1540 

1 In subsection (a), ‘‘Foreign relations’’ should be ‘‘Foreign Relations’’. 

(d)(1) After the expiration of the period of time provided for in 

subsection (b)(2) with respect to the closure or realignment of a 

military installation, funds which would otherwise be available to 

the Secretary to effect the closure or realignment of that installation may be used by him for such purpose. 

(2) Nothing in this section restricts the authority of the Secretary to obtain architectural and engineering services under section 2807 of this title. 

(e) In this section: 

(1) The term ‘‘military installation’’ means a base, camp, 

post, station, yard, center, homeport facility for any ship, or 

other activity under the jurisdiction of the Department of Defense, including any leased facility, which is located within any 

of the several States, the District of Columbia, the Commonwealth of Puerto Rico, American Samoa, the Virgin Islands, 

the Commonwealth of the Northern Mariana Islands, or Guam. 

Such term does not include any facility used primarily for civil 

works, rivers and harbors projects, or flood control projects. 

(2) The term ‘‘civilian personnel’’ means direct-hire, permanent civilian employees of the Department of Defense. 

(3) The term ‘‘realignment’’ includes any action which both 

reduces and relocates functions and civilian personnel positions, but does not include a reduction in force resulting from 

workload adjustments, reduced personnel or funding levels, 

skill imbalances, or other similar causes. 

(4) The term ‘‘legislative day’’ means a day on which either 

House of Congress is in session. 

(Added Pub. L. 95–82, title VI, Sec. 612(a), Aug. 1, 1977, 91 Stat. 379; amended Pub. L. 95– 

356, title VIII, Sec. 805, Sept. 8, 1978, 92 Stat. 586; Pub. L. 97–214, Sec. 10(a)(8), July 12, 1982, 

96 Stat. 175; Pub. L. 98–525, title XIV, Sec. 1405(41), Oct. 19, 1984, 98 Stat. 2624; Pub. L. 99– 

145, title XII, Sec. 1202(a), Nov. 8, 1985, 99 Stat. 716; Pub. L. 100–180, div. A, title XII, Sec. 

1231(17), Dec. 4, 1987, 101 Stat. 1161; Pub. L. 101–510, div. B, title XXIX, Sec. 2911, Nov. 5, 

1990, 104 Stat. 1819; Pub. L. 104–106, div. A, title XV, Sec. 1502(a)(1), Feb. 10, 1996, 110 Stat. 

502; Pub. L. 106–65, div. A, title X, Sec. 1067(1), Oct. 5, 1999, 113 Stat. 774; Pub. L. 110–417, 

div. B, title XXVIII, Sec. 2823(a), Oct. 14, 2008, 122 Stat. 4730.) 

§ 2687a. Overseas base closures and realignments and basing master plans 

(a) ANNUAL STATUS REPORT.—At the same time that the budget is submitted under section 1105(a) of title 31 for a fiscal year, 

the Secretary of Defense shall submit to the congressional defense 

committees and the Committee on Foreign relations 1 of the Senate 

and the Committee on Foreign Affairs of the House of Representatives a report on— 

(1) the status of overseas base closure and realignment actions undertaken as part of a global defense posture realignment strategy; and 

(2) the status of development and execution of comprehensive master plans for overseas military main operating bases, 

forward operating sites, and cooperative security locations. 

(b) REPORT ELEMENTS.—A report under subsection (a) shall address the following: 

(1) How the master plans described in subsection (a)(2) 

would support the security commitments undertaken by the 
1541 § 2688 CH. 159—REAL PROPERTY 

2 In section 2687a(b)(1), ‘‘The Treaty’’ probably should be ‘‘the Treaty’’. 

United States pursuant to any international security treaty, including, the North Atlantic Treaty, The 2 Treaty of Mutual Cooperation and Security between the United States and Japan, 

and the Security Treaty Between Australia, New Zealand, and 

the United States of America. 

(2) The impact of such plans on the current security environments in the combatant commands, including United States 

participation in theater security cooperation activities and bilateral partnership, exchanges, and training exercises. 

(3) Any comments of the Secretary of Defense resulting 

from an interagency review of these plans that includes the 

Department of State and other Federal departments and agencies that the Secretary of Defense considers necessary for national security. 

(Added Pub. L. 111–84, div. B, title XXVIII, Sec. 2822(a)(1), Oct. 28, 2009, 123 Stat. 2665; 

amended Pub. L. 111–383, div. A, title X, Sec. 1075(b)(44), Jan. 7, 2011, 124 Stat. 4371.) 

§ 2688. Utility systems: conveyance authority 

(a) CONVEYANCE AUTHORITY.—(1) The Secretary of a military 

department may convey a utility system, or part of a utility system, 

under the jurisdiction of the Secretary to a municipal, private, regional, district, or cooperative utility company or other entity. The 

conveyance may consist of all right, title, and interest of the United 

States in the utility system or such lesser estate as the Secretary 

considers appropriate to serve the interests of the United States. 

(2) The Secretary concerned may not enter into a contract to 

convey a utility system, or part of a utility system, under this subsection until— 

(A) the Secretary submits to the congressional defense 

committees an economic analysis, based upon accepted lifecycle costing procedures approved by the Secretary of Defense, 

that demonstrates that— 

(i) the long-term economic benefit to the United States 

of the conveyance of the utility system, or part thereof, exceeds the long-term economic cost to the United States of 

the conveyance; 

(ii) the conveyance of the utility system, or part thereof, will reduce the long-term cost to the United States of 

utility services provided by the utility system by 10 percent of the long-term cost for provision of those utility 

services in the agency tender; and 

(iii) the economic benefit analysis under clause (i) and 

the cost reduction analysis under clause (ii) incorporate 

margins of error in the estimates, based upon guidance approved by the Secretary of Defense that minimize any 

underestimation of the costs resulting from privatization of 

the utility system, or part thereof, or any overestimation 

of the costs resulting from continued Government ownership and management of the utility system, or part thereof; and 

(B) the end of the 21-day period beginning on the date on 

which the economic analysis prepared under subparagraph (A) 
§ 2688 CH. 159—REAL PROPERTY 1542 

with respect to the conveyance of the utility system, or part 

thereof, is received by the congressional defense committees or, 

if over earlier, the end of the 14-day period beginning on the 

date on which a copy of the economic analysis is provided in 

an electronic medium pursuant to section 480 of this title. 

(3)(A) If, as a result of the economic analysis required by paragraph (2)(A), the Secretary concerned determines that a utility system, or part of a utility system, is not eligible for conveyance under 

this subsection, the Secretary concerned may not further reconsider 

the utility system, or part of a utility system, for conversion to contractor operation under section 2461 of this title for a period of five 

years beginning on the date of the determination. 

(B) If the results of a public-private competition for conversion 

of a utility system, or part of a utility system, to operation by a 

contractor favors continued operation by civilian employees of the 

Department of Defense, the Secretary concerned may not reconsider the utility system, or part of a utility system, for conversion 

under section 2461 of this title or for conveyance under this subsection for a period of five years beginning on the date of the completion of the public-private competition. 

(b) SELECTION OF CONVEYEE.—(1) If more than one utility or 

entity referred to in subsection (a) notifies the Secretary concerned 

of an interest in a conveyance under such subsection, the Secretary 

shall carry out the conveyance through the use of competitive procedures. 

(2) Notwithstanding paragraph (1), the Secretary concerned 

may use procedures other than competitive procedures, but only in 

accordance with subsections (c) through (f) of section 2304 of this 

title, to select the conveyee of a utility system (or part of a utility 

system) under subsection (a). 

(3) With respect to the solicitation process used in connection 

with the conveyance of a utility system (or part of a utility system) 

under subsection (a), the Secretary concerned shall ensure that the 

process is conducted in a manner consistent with the laws and regulations of the State in which the utility system is located to the 

extent necessary to ensure that all interested regulated and unregulated utility companies and other interested entities receive an 

opportunity to acquire and operate the utility system to be conveyed. 

(c) CONSIDERATION.—(1) The Secretary concerned may require 

as consideration for a conveyance under subsection (a) an amount 

equal to the fair market value (as determined by the Secretary) of 

the right, title, or interest of the United States conveyed. The consideration may take the form of— 

(A) a lump sum payment; or 

(B) a reduction in charges for utility services provided by 

the utility or entity concerned to the military installation at 

which the utility system is located. 

(2) If the utility services proposed to be provided as consideration under paragraph (1) are subject to regulation by a Federal or 

State agency, any reduction in the rate charged for the utility services shall be subject to establishment or approval by that agency. 

(d) CONTRACTS FOR UTILITY SERVICES.—(1) Except as provided 

in paragraph (2), a contract for the receipt of utility services as con-
1543 § 2688 CH. 159—REAL PROPERTY 

sideration under subsection (c), or any other contract for utility 

services entered into by the Secretary concerned in connection with 

the conveyance of a utility system under this section, may be for 

a period not to exceed 10 years. 

(2) The Secretary of Defense, or the designee of the Secretary, 

may authorize a contract for utility services described in paragraph 

(1) to have a term in excess of 10 years, but not to exceed 50 years, 

if the Secretary determines that a contract for a longer term will 

be cost effective. The economic analysis submitted to the congressional defense committees under subsection (a)(2) for the conveyance of the utility system, or part thereof, with regard to which the 

utility services contract will be entered into by the Secretary concerned shall include the determination required by this paragraph, 

an explanation of the need for the longer term contract, and a comparison of costs between a 10-year contract and the longer-term 

contract. 

(e) TREATMENT OF PAYMENTS.—(1) A lump sum payment received under subsection (c) shall be credited, at the election of the 

Secretary concerned— 

(A) to an appropriation of the military department concerned available for the procurement of the same utility services as are provided by the utility system conveyed under this 

section; 

(B) to an appropriation of the military department available for carrying out energy savings projects or water conservation projects; or 

(C) to an appropriation of the military department available for improvements to other utility systems. 

(2) Amounts so credited shall be merged with funds in the appropriation to which credited and shall be available for the same 

purposes, and subject to the same conditions and limitations, as 

the appropriation with which merged. 

(f) QUARTERLY REPORT.—Not later than 30 days after the end 

of each quarter of a fiscal year, the Secretary shall submit to the 

congressional defense committees a report on the conveyances 

made under subsection (a) during such fiscal quarter. 

(g) ADDITIONAL TERMS AND CONDITIONS.—(1) The Secretary 

concerned may require such additional terms and conditions in connection with a conveyance under subsection (a) as the Secretary 

considers appropriate to protect the interests of the United States. 

(2) The Secretary concerned shall require in any contract for 

the conveyance of a utility system (or part of a utility system) 

under subsection (a) that the conveyee manage and operate the 

utility system in a manner consistent with applicable Federal and 

State regulations pertaining to health, safety, fire, and environmental requirements. 

(h) ASSISTANCE FOR CONSTRUCTION, REPAIR, OR REPLACEMENT

OF UTILITY SYSTEMS.—In lieu of carrying out a military construction project to construct, repair, or replace a utility system, the Secretary concerned may use funds authorized and appropriated for 

the project to facilitate the conveyance of the utility system under 

this section by making a contribution toward the cost of construction, repair, or replacement of the utility system by the entity to 

which the utility system is being conveyed. The Secretary con-
[§ 2689 CH. 159—REAL PROPERTY 1544 

cerned shall consider any such contribution in the economic analysis required under subsection (a)(2). 

(i) UTILITY SYSTEM DEFINED.—(1) In this section, the term 

‘‘utility system’’ means any of the following: 

(A) A system for the generation and supply of electric 

power. 

(B) A system for the treatment or supply of water. 

(C) A system for the collection or treatment of wastewater. 

(D) A system for the generation or supply of steam, hot 

water, and chilled water. 

(E) A system for the supply of natural gas. 

(F) A system for the transmission of telecommunications. 

(2) The term ‘‘utility system’’ includes the following: 

(A) Equipment, fixtures, structures, and other improvements utilized in connection with a system referred to in paragraph (1). 

(B) Real property, easements, and rights-of-way associated 

with a system referred to in that paragraph. 

(j) CONSTRUCTION OF UTILITY INFRASTRUCTURE AFTER CONVEYANCE OF A UTILITY SYSTEM.—(1) Upon conveyance of a utility system, the Secretary of a military department may convey additional 

utility infrastructure under the jurisdiction of the Secretary on a 

military installation to a utility or entity to which a utility system 

for the installation has been conveyed under subsection (a) if the 

Secretary determines that— 

(A) the additional utility infrastructure was constructed or 

installed after the date of the conveyance of the utility system; 

(B) the additional utility infrastructure cannot operate 

without being a part of the conveyed utility system; 

(C) the additional utility infrastructure was planned and 

coordinated with the entity operating the conveyed utility system; and 

(D) the military department receives as consideration an 

amount equal to the fair market value of the utility infrastructure determined in the same manner as the consideration the 

Secretary could require under subsection (c) for a conveyance 

under subsection (a). 

(2) The conveyance under this paragraph may consist of all 

right, title, and interest of the United States or such lesser estate 

as the Secretary considers appropriate to serve the interests of the 

United States. 

(k) LIMITATION.—This section shall not apply to projects constructed or operated by the Army Corps of Engineers under its civil 

works authorities. 

(Added Pub. L. 105–85, div. B, title XXVIII, Sec. 2812(a), Nov. 18, 1997, 111 Stat. 1992; Pub. 

L. 106–65, div. A, title X, Sec. 1067(1), div. B, title XXVIII, Sec. 2812, Oct. 5, 1999, 113 Stat. 

774, 851; Pub. L. 106–398, Sec. 1 [[div. A], title X, Sec. 1087(a)(15), div. B, title XXVIII, Sec. 

2813], Oct. 30, 2000, 114 Stat. 1654, 1654A–291, 1654A–418; Pub. L. 108–136, div. A, title X, 

Sec. 1031(a)(32), Nov. 24, 2003, 117 Stat. 1600; Pub. L. 109–163, div. B, title XXVIII, Sec. 

2823(a)–(d), Jan. 6, 2006, 119 Stat. 3514–3516; Pub. L. 110–417, div. B, title XXVIII, Sec. 2813, 

Oct. 14, 2008, 122 Stat. 4728; Pub. L. 111–84, div. B, title XXVIII, Sec. 2821, Oct. 28, 2009, 

123 Stat. 2664.) 

[§ 2689. Renumbered 2917] 

[§ 2690. Renumbered 2918] 
1545 § 2692 CH. 159—REAL PROPERTY 

§ 2691. Restoration of land used by permit or lease 

(a) The Secretary of the military department concerned may 

remove improvements and take any other action necessary in the 

judgment of the Secretary to restore land used by that military department by permit or lease from another military department or 

Federal agency if the restoration is required by the permit or lease 

making that land available to the military department. The Secretary concerned may carry out this section using funds available 

for operations and maintenance or for military construction. 

(b) Unless otherwise prohibited by law or the terms of the permit or lease, before restoration of any land under subsection (a) is 

begun, the Secretary concerned shall determine, under the provisions of subtitle I of title 40 and division C (except sections 3302, 

3501(b), 3509, 3906, 4710, and 4711) of subtitle I of title 41, whether another military department or Federal agency has a use for the 

land in its existing, improved state. During the period required to 

make such a determination, the Secretary may provide for maintenance and repair of improvements on the land to the standards established for excess property by the Administrator of General Services. 

(c)(1) As a condition of any lease, permit, license, or other 

grant of access entered into by the Secretary of a military department with another Federal agency authorizing the agency to use 

lands under the control of the Secretary, the Secretary may require 

the agency to agree to remove any improvements and to take any 

other action necessary in the judgment of the Secretary to restore 

the land used by the agency to its condition before its use by the 

agency. 

(2) In lieu of performing any removal or restoration work 

under paragraph (1), a Federal agency may elect, with the consent 

of the Secretary, to reimburse the Secretary for the costs incurred 

by the military department in performing such removal or restoration work. 

(Added Pub. L. 98–407, title VIII, Sec. 804(a), Aug. 28, 1984, 98 Stat. 1519; amended Pub. L. 

99–145, title XIII, Sec. 1303(a)(17), Nov. 8, 1985, 99 Stat. 739; Pub. L. 105–261, div. B, title 

XXVIII, Sec. 2812(a), (b)(1), Oct. 17, 1998, 112 Stat. 2205; Pub. L. 107–217, Sec. 3(b)(15), Aug. 

21, 2002, 116 Stat. 1296; Pub. L. 111–350, Sec. 5(b)(46), Jan. 4, 2011, 124 Stat. 3846.) 

§ 2692. Storage, treatment, and disposal of nondefense toxic 

and hazardous materials 

(a)(1) Except as otherwise provided in this section, the Secretary of Defense may not permit the use of an installation of the 

Department of Defense for the storage, treatment, or disposal of 

any material that is a toxic or hazardous material and that is not 

owned either by the Department of Defense or by a member of the 

armed forces (or a dependent of the member) assigned to or provided military housing on the installation. 

(2) The Secretary of Defense shall define by regulation what 

materials are hazardous or toxic materials for the purposes of this 

section, including specification of the quantity of a material that 

serves to make it hazardous or toxic for the purposes of this section. The definition shall include materials referred to in section 

101(14) of the Comprehensive Environmental Response, Compensation, and Liability Act of 1980 (42 U.S.C. 9601(14)) and materials 
§ 2692 CH. 159—REAL PROPERTY 1546 

designated under section 102 of that Act (42 U.S.C. 9602) and shall 

include materials that are of an explosive, flammable, or pyrotechnic nature. 

(b) Subsection (a) does not apply to the following: 

(1) The storage, treatment, or disposal of materials that 

will be or have been used in connection with an activity of the 

Department of Defense or in connection with a service to be 

performed on an installation of the Department for the benefit 

of the Department. 

(2) The storage of strategic and critical materials in the 

National Defense Stockpile under an agreement for such storage with the Administrator of General Services. 

(3) The temporary storage or disposal of explosives in 

order to protect the public or to assist agencies responsible for 

Federal, State, or local law enforcement in storing or disposing 

of explosives when no alternative solution is available, if such 

storage or disposal is made in accordance with an agreement 

between the Secretary of Defense and the head of the Federal, 

State, or local agency concerned. 

(4) The temporary storage or disposal of explosives in 

order to provide emergency lifesaving assistance to civil authorities. 

(5) The disposal of excess explosives produced under a Department of Defense contract, if the head of the military department concerned determines, in each case, that an alternative feasible means of disposal is not available to the contractor, taking into consideration public safety, available resources of the contractor, and national defense production requirements. 

(6) The temporary storage of nuclear materials or nonnuclear classified materials in accordance with an agreement 

with the Secretary of Energy. 

(7) The storage of materials that constitute military resources intended to be used during peacetime civil emergencies 

in accordance with applicable Department of Defense regulations. 

(8) The temporary storage of materials of other Federal 

agencies in order to provide assistance and refuge for commercial carriers of such material during a transportation emergency. 

(9) The storage of any material that is not owned by the 

Department of Defense if the Secretary of the military department concerned determines that the material is required or 

generated in connection with the authorized and compatible 

use of a facility of the Department of Defense, including the 

use of such a facility for testing material or training personnel. 

(10) The treatment and disposal of any material that is not 

owned by the Department of Defense if the Secretary of the 

military department concerned determines that the material is 

required or generated in connection with the authorized and 

compatible use of a facility of that military department and the 

Secretary enters into a contract or agreement with the prospective user that— 
1547 § 2694 CH. 159—REAL PROPERTY 

(A) is consistent with the best interest of national defense and environmental security; and 

(B) provides for the prospective user’s continued financial and environmental responsibility and liability with regard to the material. 

(11) The storage of any material that is not owned by the 

Department of Defense if the Secretary of the military department concerned determines that the material is required or 

generated in connection with the use of a space launch facility 

located on an installation of the Department of Defense or on 

other land controlled by the United States. 

(c) The Secretary of Defense may grant exceptions to subsection (a) when essential to protect the health and safety of the 

public from imminent danger if the Secretary otherwise determines 

the exception is essential and if the storage or disposal authorized 

does not compete with private enterprise. 

(d)(1) The Secretary may assess a charge for any storage or 

disposal provided under this section. Any such charge shall be on 

a reimbursable cost basis. 

(2) In the case of storage under this section authorized because 

of an imminent danger, the storage provided shall be temporary 

and shall cease once the imminent danger no longer exists. In all 

other cases of storage or disposal authorized under this section, the 

storage or disposal authorized shall be terminated as determined 

by the Secretary. 

(Added Pub. L. 98–407, title VIII, Sec. 805(a), Aug. 28, 1984, 98 Stat. 1520; amended Pub. L. 

102–484, div. B, title XXVIII, Sec. 2852, Oct. 23, 1992, 106 Stat. 2625; Pub. L. 103–337, div. 

A, title III, Sec. 325, Oct. 5, 1994, 108 Stat. 2711; Pub. L. 105–85, div. A, title III, Sec. 343(a)– 

(g)(2), Nov. 18, 1997, 111 Stat. 1686, 1687; Pub. L. 106–65, div. A, title X, Sec. 1066(a)(25), Oct. 

5, 1999, 113 Stat. 772; Pub. L. 109–364, div. A, title X, Sec. 1071(a)(21), Oct. 17, 2006, 120 Stat. 

2399.) 

[§ 2693. Repealed. Pub. L. 109–364, div. B, title XXVIII, Sec. 

2825(c)(2), Oct. 17, 2006, 120 Stat. 2477] 

§ 2694. Conservation and cultural activities 

(a) ESTABLISHMENT.—The Secretary of Defense may establish 

and carry out a program to conduct and manage in a coordinated 

manner the conservation and cultural activities described in subsection (b). 

(b) ACTIVITIES.—(1) A conservation or cultural activity eligible 

for the program that the Secretary establishes under subsection (a) 

is any activity— 

(A) that has regional or Department of Defense-wide significance and that involves more than one military department; 

(B) that is necessary to meet legal requirements or to support military operations; 

(C) that can be more effectively managed at the Department of Defense level; and 

(D) for which no executive agency has been designated responsible by the Secretary. 

(2) Such activities include the following: 

(A) The development of ecosystem-wide land management 

plans. 
§ 2694a CH. 159—REAL PROPERTY 1548 

(B) The conduct of wildlife studies to ensure the safety of 

military operations. 

(C) The identification and return of Native American 

human remains and cultural items in the possession or control 

of the Department of Defense, or discovered on land under the 

jurisdiction of the Department, to the appropriate Native 

American tribes. 

(D) The control of invasive species that may hinder military activities or degrade military training ranges. 

(E) The establishment of a regional curation system for artifacts found on military installations. 

(c) COOPERATIVE AGREEMENTS.—The Secretary may negotiate 

and enter into cooperative agreements with public and private 

agencies, organizations, institutions, individuals, or other entities 

to carry out the program established under subsection (a). 

(d) EFFECT ON OTHER LAWS.—Nothing in this section shall be 

construed or interpreted as preempting any otherwise applicable 

Federal, State, or local law or regulation relating to the management of natural and cultural resources on military installations. 

(Added Pub. L. 104–201, div. A, title III, Sec. 332(a)(1), Sept. 23, 1996, 110 Stat. 2484; amended 

Pub. L. 105–85, div. A, title X, Sec. 1073(a)(59), Nov. 18, 1997, 111 Stat. 1903.) 

§ 2694a. Conveyance of surplus real property for natural resource conservation 

(a) AUTHORITY TO CONVEY.—The Secretary of a military department may convey to an eligible entity described in subsection 

(b) any surplus real property that— 

(1) is under the administrative control of the Secretary; 

(2) is suitable and desirable for conservation purposes; 

(3) has been made available for public benefit transfer for 

a sufficient period of time to potential claimants; and 

(4) is not subject to a pending request for transfer to another Federal agency or for conveyance to any other qualified 

recipient for public benefit transfer under the real property disposal processes and authorities under subtitle I of title 40. 

(b) ELIGIBLE ENTITIES.—The conveyance of surplus real property under this section may be made to any of the following: 

(1) A State or political subdivision of a State. 

(2) A nonprofit organization that exists for the primary 

purpose of conservation of natural resources on real property. 

(c) REVERSIONARY INTEREST AND OTHER DEED REQUIREMENTS.—(1) The deed of conveyance of any surplus real property 

conveyed under this section shall require the property to be used 

and maintained for the conservation of natural resources in perpetuity. If the Secretary concerned determines at any time that the 

property is not being used or maintained for such purpose, then, 

at the option of the Secretary, all or any portion of the property 

shall revert to the United States. 

(2) The deed of conveyance may permit the recipient of the 

property— 

(A) to convey the property to another eligible entity, subject to the approval of the Secretary concerned and subject to 

the same covenants and terms and conditions as provided in 

the deed from the United States; and 
1549 § 2694a CH. 159—REAL PROPERTY 

(B) to conduct incidental revenue-producing activities on 

the property that are compatible with the use of the property 

for conservation purposes. 

(3) The deed of conveyance may contain such additional terms, 

reservations, restrictions, and conditions as the Secretary concerned considers appropriate to protect the interests of the United 

States. 

(d) RELEASE OF COVENANTS.—With the concurrence of the Secretary of Interior, the Secretary concerned may grant a release 

from a covenant included in the deed of conveyance of real property 

conveyed under this section, subject to the condition that the recipient of the property pay the fair market value, as determined by the 

Secretary concerned, of the property at the time of the release of 

the covenant. The Secretary concerned may reduce the amount required to be paid under this subsection to account for the value of 

the natural resource conservation benefit that has accrued to the 

United States during the period the covenant was in effect, if the 

benefit was not taken into account in determining the original consideration for the conveyance. 

(e) CONGRESSIONAL NOTIFICATION.—The Secretary concerned 

may not approve of the reconveyance of real property under subsection (c) or grant the release of a covenant under subsection (d) 

until the Secretary notifies the appropriate committees of Congress 

of the proposed reconveyance or release and a period of 21 days 

elapses from the date the notification is received by the committees 

or, if earlier, a period of 14 days has elapsed from the date on 

which a copy of the notification is provided in an electronic medium 

pursuant to section 480 of this title. 

(f) LIMITATIONS.—The conveyance of real property under this 

section shall not be used as a condition of allowing any defense activity under any Federal, State, or local permitting or review process. The Secretary concerned may make the conveyance, with the 

restrictions specified in subsection (c), to establish a mitigation 

bank, but only if the establishment of the mitigation bank does not 

occur in order to satisfy any condition for permitting military activity under a Federal, State, or local permitting or review process. 

(g) CONSIDERATION.—In fixing the consideration for the conveyance of real property under this section, or in determining the 

amount of any reduction of the amount to be paid for the release 

of a covenant under subsection (d), the Secretary concerned shall 

take into consideration any benefit that has accrued or may accrue 

to the United States from the use of such property for the conservation of natural resources. 

(h) RELATION TO OTHER CONVEYANCE AUTHORITIES.—(1) The 

Secretary concerned may not make a conveyance under this section 

of any real property to be disposed of under a base closure law in 

a manner that is inconsistent with the requirements and conditions 

of the base closure law. 

(2) In the case of real property on Guam, the Secretary concerned may not make a conveyance under this section unless the 

Government of Guam has been first afforded the opportunity to acquire the real property as authorized by section 1 of Public Law 

106–504 (114 Stat. 2309). 

(i) DEFINITIONS.—In this section: 
§ 2694b CH. 159—REAL PROPERTY 1550 

(1) The term ‘‘appropriate committees of Congress’’ has the 

meaning given such term in section 2801 of this title. 

(2) The term ‘‘Secretary concerned’’ means the Secretary of 

a military department. 

(3) The term ‘‘State’’ includes the District of Columbia, the 

Commonwealth of Puerto Rico, the Commonwealth of the 

Northern Marianas, Guam, the Virgin Islands, and American 

Samoa. 

(Added Pub. L. 107–314, div. B, title XXVIII, Sec. 2812(a)(1), Dec. 2, 2002, 116 Stat. 2707; 

amended Pub. L. 109–163, div. A, title X, Sec. 1056(a)(1), (b), Jan. 6, 2006, 119 Stat. 3438, 3439; 

Pub. L. 109–364, div. A, title X, Sec. 1071(a)(22), Oct. 17, 2006, 120 Stat. 2399; Pub. L. 111– 

383, div. B, title XXVIII, Sec. 2803(a), Jan. 7, 2011, 124 Stat. 4458.) 

§ 2694b. Participation in wetland mitigation banks 

(a) AUTHORITY TO PARTICIPATE.—The Secretary of a military 

department, and the Secretary of Defense with respect to matters 

concerning a Defense Agency, when engaged in an authorized activity that may or will result in the destruction of, or an adverse 

impact to, a wetland, may make payments to a wetland mitigation 

banking program or ‘‘in-lieu-fee’’ mitigation sponsor approved in accordance with the Federal Guidance for the Establishment, Use 

and Operation of Mitigation Banks (60 Fed. Reg. 58605; November 

28, 1995) or the Federal Guidance on the Use of In-Lieu-Fee Arrangements for Compensatory Mitigation Under Section 404 of the 

Clean Water Act and Section 10 of the Rivers and Harbors Act (65 

Fed. Reg. 66913; November 7, 2000), or any successor administrative guidance or regulation. 

(b) ALTERNATIVE TO CREATION OF WETLAND.—Participation in 

a wetland mitigation banking program or consolidated user site 

under subsection (a) shall be in lieu of mitigating wetland impacts 

through the creation of a wetland on Federal property. 

(c) TREATMENT OF PAYMENTS.—Payments made under subsection (a) to a wetland mitigation banking program or consolidated user site may be treated as eligible project costs for military 

construction. 

(Added Pub. L. 108–136, div. A, title III, Sec. 314(a), Nov. 24, 2003, 117 Stat. 1430.) 

§ 2694c. Participation in conservation banking programs 

(a) AUTHORITY TO PARTICIPATE.—Subject to the availability of 

appropriated funds, the Secretary concerned, when engaged or proposing to engage in an activity described in subsection (b) that may 

or will result in an adverse impact to one or more species protected 

(or pending protection) under any applicable provision of law, or 

habitat for such species, may make payments to a conservation 

banking program or ‘‘in-lieu-fee’’ mitigation sponsor approved in accordance with— 

(1) the Federal Guidance for the Establishment, Use and 

Operation of Mitigation Banks (60 Fed. Reg. 58605; November 

28, 1995); 

(2) the Guidance for the Establishment, Use, and Operation of Conservation Banks (68 Fed. Reg. 24753; May 2, 

2003); 

(3) the Federal Guidance on the Use of In-Lieu-Fee Arrangements for Compensatory Mitigation Under Section 404 of 
1551 § 2695 CH. 159—REAL PROPERTY 

the Clean Water Act and Section 10 of the Rivers and Harbors 

Act (65 Fed. Reg. 66915; November 7, 2000); or 

(4) any successor or related administrative guidance or 

regulation. 

(b) COVERED ACTIVITIES.—Payments to a conservation banking 

program or ‘‘in-lieu-fee’’ mitigation sponsor under subsection (a) 

may be made only for the purpose of facilitating one or more of the 

following activities: 

(1) Military testing, operations, training, or other military 

activity. 

(2) Military construction. 

(c) TREATMENT OF AMOUNTS FOR CONSERVATION BANKING.— 

Payments made under subsection (a) to a conservation banking 

program or ‘‘in-lieu-fee’’ mitigation sponsor for the purpose of facilitating military construction may be treated as eligible costs of the 

military construction project. 

(d) SOURCE OF FUNDS.—Amounts available from any of the following shall be available for activities under this section: 

(1) Operation and maintenance. 

(2) Military construction. 

(3) Research, development, test, and evaluation. 

(4) The Support for United States Relocation to Guam Account established under section 2824 of the Military Construction Authorization Act for Fiscal Year 2009 (division B of Public Law 110–417; 122 Stat. 4730; 10 U.S.C. 2687 note). 

(e) SECRETARY CONCERNED DEFINED.—In this section, the term 

‘‘Secretary concerned’’ means— 

(1) the Secretary of a military department; and 

(2) the Secretary of Defense with respect to a Defense 

Agency. 

(Added Pub. L. 110–417, [div. A], title III, Sec. 311(a), Oct. 14, 2008, 122 Stat. 4408; amended 

Pub. L. 111–84, div. A, title III, Sec. 311, Oct. 28, 2009, 123 Stat. 2247; Pub. L. 111–383, div. 

A, title X, Sec. 1075(b)(45), Jan. 7, 2011, 124 Stat. 4371.) 

§ 2695. Acceptance of funds to cover administrative expenses relating to certain real property transactions 

(a) AUTHORITY TO ACCEPT.—In connection with a real property 

transaction referred to in subsection (b) with a non-Federal person 

or entity, the Secretary of a military department may accept 

amounts provided by the person or entity to cover administrative 

expenses incurred by the Secretary in entering into the transaction. 

(b) COVERED TRANSACTIONS.—Subsection (a) applies to the following transactions involving real property under the control of the 

Secretary of a military department: 

(1) The exchange of real property. 

(2) The grant of an easement over, in, or upon real property of the United States. 

(3) The lease or license of real property of the United 

States. 

(4) The disposal of real property of the United States for 

which the Secretary will be the disposal agent. 

(5) The conveyance of real property under section 2694a of 

this title. 
§ 2696 CH. 159—REAL PROPERTY 1552 

(c) USE OF AMOUNTS COLLECTED.—Amounts collected under 

subsection (a) for administrative expenses shall be credited to the 

appropriation, fund, or account from which the expenses were paid. 

Amounts so credited shall be merged with funds in such appropriation, fund, or account and shall be available for the same purposes 

and subject to the same limitations as the funds with which 

merged. 

(Added Pub. L. 105–85, div. B, title XXVII, Sec. 2813(a), Nov. 18, 1997, 111 Stat. 1993; amended 

Pub. L. 106–65, div. B, title XXVIII, Sec. 2813, Oct. 5, 1999, 113 Stat. 851; Pub. L. 107–314, 

div. B, title XXVIII, Sec. 2812(b), Dec. 2, 2002, 116 Stat. 2709.) 

§ 2696. Real property: transfer between armed forces and 

screening requirements for other Federal use 

(a) TRANSFERS BETWEEN ARMED FORCES.—If either of the Secretaries concerned requests it and the other approves, real property 

may be transferred, without compensation, from one armed force to 

another. Section 2571(d) of this title shall apply to the transfer of 

real property under this subsection. 

(b) SCREENING REQUIREMENTS FOR ADDITIONAL FEDERAL

USE.—The Secretary concerned may not convey real property that 

is authorized or required to be conveyed, whether for or without 

consideration, by any provision of law enacted after December 31, 

1997, unless the Administrator of General Services has screened 

the property for further Federal use in accordance with subtitle I 

of title 40 and division C (except sections 3302, 3501(b), 3509, 3906, 

4710, and 4711) of subtitle I of title 41. 

(c) TIME FOR SCREENING.—(1) Before the end of the 30-day period beginning on the date of the enactment of a provision of law 

authorizing or requiring the conveyance of a parcel of real property 

by the Secretary concerned, the Administrator of General Services 

shall complete the screening referred to in subsection (b) with regard to the real property and notify the Secretary concerned and 

Congress of the results of the screening. The notice shall include— 

(A) the name of the Federal agency requesting transfer of 

the property; 

(B) the proposed use to be made of the property by the 

Federal agency; and 

(C) the fair market value of the property, including any 

improvements thereon, as estimated by the Administrator. 

(2) If the Administrator fails to complete the screening and notify the Secretary and Congress concerned within such period, the 

Secretary concerned shall proceed with the conveyance of the real 

property as provided in the provision of law authorizing or requiring the conveyance. 

(d) EFFECT OF SUBMISSION OF NOTICE.—If the Administrator of 

General Services submits notice under subsection (c)(1) that further Federal use of a parcel of real property is requested by a Federal agency, the Secretary concerned may not proceed with the conveyance of the real property as provided in the provision of law authorizing or requiring the conveyance until the end of the 180-day 

period beginning on the date on which the notice is submitted to 

Congress. 

(e) EXCEPTED CONVEYANCE AUTHORITIES.—The screening requirements of subsection (b) shall not apply to real property au-
1553 § 2697 CH. 159—REAL PROPERTY 

thorized or required to be conveyed under any of the following provisions of law: 

(1) A base closure law. 

(2) Chapter 5 of title 40. 

(3) Any specific provision of law authorizing or requiring 

the transfer of administrative jurisdiction over a parcel of real 

property between Federal agencies. 

(f) SCREENING AND CONVEYANCE OF PROPERTY FOR CORRECTIONAL FACILITIES PURPOSES.—(1) Except as provided in paragraph 

(2), before any real property or facility of the United States that 

is under the jurisdiction of any department, agency, or instrumentality of the Department of Defense is determined to be excess to 

the needs of such department, agency, or instrumentality, the Secretary of Defense shall— 

(A) provide adequate notification of the availability of such 

real property or facility within the Department of Defense; 

(B) if the real property or facility remains available after 

such notification, notify the Attorney General of its availability; and 

(C) if the Attorney General certifies to the Secretary of Defense that a determination has been made by the Director of 

the Bureau of Justice Assistance within the Department of 

Justice to utilize the real property or facility under the correctional options program carried out under section 515 of title I 

of the Omnibus Crime Control and Safe Streets Act of 1968 (42 

U.S.C. 3762a), convey the real property or facility, without reimbursement, to a public agency referred to in paragraph (1) 

or (3) of subsection (a) of such section for such utilization. 

(2) Paragraph (1) shall not apply— 

(A) to real property and facilities to which title II of the 

Defense Authorization Amendments and Base Closure and Realignment Act (Public Law 100–526) is applicable; and 

(B) during any portion of a fiscal year after four conveyances have been made under paragraph (1) in such fiscal year. 

(Added Pub. L. 105–85, div. B, title XXVIII, Sec. 2814(a)(1), Nov. 18, 1997, 111 Stat. 1994; Pub. 

L. 106–65, div. A, title X, Sec. 1066(a)(26), Oct. 5, 1999, 113 Stat. 772; Pub. L. 107–217, Sec. 

3(b)(16), Aug. 21, 2002, 116 Stat. 1296; Pub. L. 108–136, div. A, title X, Secs. 1031(a)(33), 

1043(c)(4), Nov. 24, 2003, 117 Stat. 1600, 1612; Pub. L. 109–364, div. B, title XXVIII, Sec. 

2825(a), (b)(5), (c)(3), (d)(2)(A), Oct. 17, 2006, 120 Stat. 2476, 2477; Pub. L. 111–350, Sec. 

5(b)(47), Jan. 4, 2011, 124 Stat. 3846.) 

§ 2697. Acceptance and use of landing fees charged for use 

of domestic military airfields by civil aircraft 

(a) AUTHORITY.—The Secretary of a military department may 

impose landing fees for the use by civil aircraft of domestic military 

airfields under the jurisdiction of that Secretary and may use any 

fees received under this section as a source of funding for the operation and maintenance of airfields of that department. 

(b) UNIFORM LANDING FEES.—The Secretary of Defense shall 

prescribe the amount of the landing fees that may be imposed 

under this section. Such fees shall be uniform among the military 

departments. 

(c) USE OF PROCEEDS.—Amounts received for a fiscal year in 

payment of landing fees imposed under this section for the use of 

a military airfield shall be credited to the appropriation that is 
§ 2697 CH. 159—REAL PROPERTY 1554 

available for that fiscal year for the operation and maintenance of 

that military airfield, shall be merged with amounts in the appropriation to which credited, and shall be available for that military 

airfield for the same period and purposes as the appropriation is 

available. 

(d) LIMITATION.—The Secretary of a military department shall 

determine whether consideration for a landing fee has been received in a lease, license, or other real estate agreement for an airfield and shall use such a determination to offset appropriate 

amounts imposed under subsection (a) for that airfield. 

(Added Pub. L. 111–383, div. A, title III, Sec. 341(a), Jan. 7, 2011, 124 Stat. 4189.) 
1555 

CHAPTER 160—ENVIRONMENTAL RESTORATION 

Sec. 

2700. Definitions. 

2701. Environmental restoration program. 

2702. Research, development, and demonstration program. 

2703. Environmental restoration accounts. 

2704. Commonly found unregulated hazardous substances. 

2705. Notice of environmental restoration activities. 

2706. Annual reports to Congress. 

2707. Environmental restoration projects for environmental responses. 

2708. Contracts for handling hazardous waste from defense facilities. 

2709. Investment control process for environmental technologies. 

2710. Inventory of unexploded ordnance, discarded military munitions, and munitions constituents at defense sites (other than operational ranges). 

§ 2700. Definitions 

In this chapter: 

(1) The term ‘‘CERCLA’’ means the Comprehensive Environmental Response, Compensation, and Liability Act of 1980 

(42 U.S.C. 9601 et seq.). 

(2) The terms ‘‘environment’’, ‘‘facility’’, ‘‘hazardous substance’’, ‘‘person’’, ‘‘pollutant or contaminant’’, ‘‘release’’, ‘‘removal’’, ‘‘response’’, ‘‘disposal’’, and ‘‘hazardous waste’’ have the 

meanings given those terms in section 101 of CERCLA (42 

U.S.C. 9601). 

(3) The term ‘‘Administrator’’ means the Administrator of 

the Environmental Protection Agency. 

(Added Pub. L. 99–499, title II, Sec. 211(a)(1)(B), Oct. 17, 1986, 100 Stat. 1725, Sec. 2707; renumbered Sec. 2700 and amended Pub. L. 107–314, div. A, title III, Sec. 313(a)(1), (c)(1), Dec. 

2, 2002, 116 Stat. 2507; Pub. L. 111–383, div. A, title X, Sec. 1075(b)(46)(A), Jan. 7, 2011, 124 

Stat. 4371.) 

§ 2701. Environmental restoration program 

(a) ENVIRONMENTAL RESTORATION PROGRAM.— 

(1) IN GENERAL.—The Secretary of Defense shall carry out 

a program of environmental restoration at facilities under the 

jurisdiction of the Secretary. The program shall be known as 

the ‘‘Defense Environmental Restoration Program’’. 

(2) APPLICATION OF SECTION 120 OF CERCLA.—Activities of 

the program described in subsection (b)(1) shall be carried out 

subject to, and in a manner consistent with, section 120 (relating to Federal facilities) of CERCLA (42 U.S.C. 9620). 

(3) CONSULTATION WITH EPA.—The program shall be carried out in consultation with the Administrator of the Environmental Protection Agency. 

(4) ADMINISTRATIVE OFFICE WITHIN OSD.—The Secretary 

shall identify an office within the Office of the Secretary which 

shall have responsibility for carrying out the program. 

(b) PROGRAM GOALS.—Goals of the program shall include the 

following: 
§ 2701 CH. 160—ENVIRONMENTAL RESTORATION 1556 

(1) The identification, investigation, research and development, and cleanup of contamination from a hazardous substance or pollutant or contaminant. 

(2) Correction of other environmental damage (such as detection and disposal of unexploded ordnance) which creates an 

imminent and substantial endangerment to the public health 

or welfare or to the environment. 

(3) Demolition and removal of unsafe buildings and structures, including buildings and structures of the Department of 

Defense at sites formerly used by or under the jurisdiction of 

the Secretary. 

(c) RESPONSIBILITY FOR RESPONSE ACTIONS.— (1) BASIC RESPONSIBILITY.—The Secretary shall carry out 

(in accordance with the provisions of this chapter and 

CERCLA) all response actions with respect to releases of hazardous substances from each of the following: 

(A) Each facility or site owned by, leased to, or otherwise possessed by the United States and under the jurisdiction of the Secretary. 

(B) Each facility or site which was under the jurisdiction of the Secretary and owned by, leased to, or otherwise 

possessed by the United States at the time of actions leading to contamination by hazardous substances. 

(C) Each vessel owned or operated by the Department 

of Defense. 

(2) OTHER RESPONSIBLE PARTIES.—Paragraph (1) shall not 

apply to a removal or remedial action if the Administrator has 

provided for response action by a potentially responsible person 

in accordance with section 122 (relating to settlements) of 

CERCLA (42 U.S.C. 9622). 

(3) STATE FEES AND CHARGES.—The Secretary shall pay 

fees and charges imposed by State authorities for permit services for the disposal of hazardous substances on lands which 

are under the jurisdiction of the Secretary to the same extent 

that nongovernmental entities are required to pay fees and 

charges imposed by State authorities for permit services. The 

preceding sentence shall not apply with respect to a payment 

that is the responsibility of a lessee, contractor, or other private person. 

(d) SERVICES OF OTHER ENTITIES.— 

(1) IN GENERAL.—Subject to paragraph (3), the Secretary 

may enter into agreements on a reimbursable or other basis 

with any other Federal agency, any State or local government 

agency, any Indian tribe, any owner of covenant property, or 

any nonprofit conservation organization to obtain the services 

of the agency, Indian tribe, owner, or organization to assist the 

Secretary in carrying out any of the Secretary’s responsibilities 

under this section. Services which may be obtained under this 

subsection include the identification, investigation, and cleanup of any off-site contamination resulting from the release of 

a hazardous substance or waste at a facility under the Secretary’s jurisdiction. 

(2) CROSS-FISCAL YEAR AGREEMENTS.—An agreement with 

an agency under paragraph (1) may be for a period that begins 
1557 § 2701 CH. 160—ENVIRONMENTAL RESTORATION 

in one fiscal year and ends in another fiscal year so long as the 

period of the agreement does not exceed two years. This twoyear limitation does not apply to an agreement funded using 

amounts in the Department of Defense Base Closure Account 

1990 or the Department of Defense Base Closure Account 2005 

established under sections 2906 and 2906A of the Defense 

Base Closure and Realignment Act of 1990 (part A of title 

XXIX of Public Law 101–510; 10 U.S.C. 2687 note). 

(3) LIMITATION ON REIMBURSABLE AGREEMENTS.—An agreement with an agency under paragraph (1) may not provide for 

reimbursement of the agency for regulatory enforcement activities. An agreement under such paragraph with respect to a site 

also may not change the cleanup standards selected for the site 

pursuant to law. 

(4) DEFINITIONS.—In this subsection: 

(A) The term ‘‘Indian tribe’’ has the meaning given 

such term in section 101(36) of CERCLA (42 U.S.C. 

9601(36)). 

(B) The term ‘‘nonprofit conservation organization’’ 

means any non-governmental nonprofit organization whose 

primary purpose is conservation of open space or natural 

resources. 

(C) The term ‘‘owner of covenant property’’ means an 

owner of property subject to a covenant provided by the 

United States in accordance with the requirements of 

paragraphs (3) and (4) of section 120(h) of CERCLA (42 

U.S.C. 9620(h)), so long as the covenant property is the 

site at which the services procured under paragraph (1) 

are to be performed. 

(5) SAVINGS CLAUSE.—Nothing in this subsection affects 

the applicability of section 120 of CERCLA (42 U.S.C. 9620) to 

the Department of Defense or the obligations and responsibilities of the Department of Defense under subsection (h) of such 

section. 

(e) RESPONSE ACTION CONTRACTORS.—The provisions of section 

119 of CERCLA (42 U.S.C. 9619) apply to response action contractors (as defined in that section) who carry out response actions 

under this section. 

(f) USE OF APPROPRIATED FUNDS AT FORMER DOD SITES.—Appropriations available to the Department of Defense may be used 

at sites formerly used by the Department of Defense for removal 

of unsafe buildings or debris of the Department of Defense. 

(g) REMOVAL OF UNSAFE BUILDINGS AND DEBRIS BEFORE RELEASE FROM FEDERAL CONTROL.—In the case of property formerly 

used by the Department of Defense which is to be released from 

Federal Government control and at which there are unsafe buildings or debris of the Department of Defense, all actions necessary 

to comply with regulations of the General Services Administration 

on the transfer of property in a safe condition shall be completed 

before the property is released from Federal Government control, 

except in the case of property to be conveyed to an entity of State 

or local government or to a native corporation. 

(h) SURETY-CONTRACTOR RELATIONSHIP.—Any surety which 

provides a bid, performance, or payment bond in connection with 
§ 2701 CH. 160—ENVIRONMENTAL RESTORATION 1558 

any direct Federal procurement for a response action contract 

under the Defense Environmental Restoration Program and begins 

activities to meet its obligations under such bond, shall, in connection with such activities or obligations, be entitled to any indemnification and the same standard of liability to which its principal 

was entitled under the contract or under any applicable law or regulation. 

(i) SURETY BONDS.— (1) APPLICABILITY OF SECTIONS 3131 AND 3133 OF TITLE 40.— If under sections 3131 and 3133 of title 40 surety bonds are required for any direct Federal procurement of any response action contract under the Defense Environmental Restoration 

Program and are not waived pursuant to section 3134 of title 

40, the surety bonds shall be issued in accordance with the sections 3131 and 3133. 

(2) LIMITATION OF ACCRUAL OF RIGHTS OF ACTION UNDER

BONDS.—If, under applicable Federal law, surety bonds are required for any direct Federal procurement of any response action contract under the Defense Environmental Restoration 

Program, no right of action shall accrue on the performance 

bond issued on such contract to or for the use of any person 

other than an obligee named in the bond. 

(3) LIABILITY OF SURETIES UNDER BONDS.—If, under applicable Federal law, surety bonds are required for any direct 

Federal procurement of any response action contract under the 

Defense Environmental Restoration Program, unless otherwise 

provided for by the Secretary in the bond, in the event of a default, the surety’s liability on a performance bond shall be only 

for the cost of completion of the contract work in accordance 

with the plans and specifications of the contract less the balance of funds remaining to be paid under the contract, up to 

the penal sum of the bond. The surety shall in no event be liable on bonds to indemnify or compensate the obligee for loss 

or liability arising from personal injury or property damage 

whether or not caused by a breach of the bonded contract. 

(4) NONPREEMPTION.—Nothing in this section shall be construed as preempting, limiting, superseding, affecting, applying 

to, or modifying any State laws, regulations, requirements, 

rules, practices, or procedures. Nothing in this section shall be 

construed as affecting, applying to, modifying, limiting, superseding, or preempting any rights, authorities, liabilities, demands, actions, causes of action, losses, judgment, claims, statutes of limitation, or obligations under Federal or State law, 

which do not arise on or under the bond. 

(j) APPLICABILITY.—(1) Subsections (h) and (i) shall not apply 

to bonds executed before December 5, 1991. 

(2) Subsections (h) and (i) shall not apply to bonds to which 

section 119(g) of CERCLA (42 U.S.C. 9619(g)) applies. 

(k) UXO PROGRAM MANAGER.—(1) The Secretary of Defense 

shall designate a program manager who shall serve as the single 

point of contact in the Department of Defense for policy and budgeting issues involving the characterization, research, remediation, 

and management of explosive and related risks with respect to 

unexploded ordnance, discarded military munitions, and munitions 
1559 § 2702 CH. 160—ENVIRONMENTAL RESTORATION 

constituents at defense sites (as such terms are defined in section 

2710 of this title) that pose a threat to human health or safety. 

(2) The position of program manager shall be filled by— 

(A) an employee in a position that is equivalent to pay 

grade O–6 or above; or 

(B) a member of the armed forces who is serving in the 

grade of colonel or, in the case of the Navy, captain, or in a 

higher grade. 

(3) The program manager shall report to the Deputy Under 

Secretary of Defense for Installations and Environment. 

(4) The program manager may establish an independent advisory and review panel that may include representatives of the National Academy of Sciences, nongovernmental organizations with 

expertise regarding unexploded ordnance, discarded military munitions, or munitions constituents, the Environmental Protection 

Agency, States (as defined in section 2710 of this title), and tribal 

governments. If established, the panel shall report annually to 

Congress on progress made by the Department of Defense to address unexploded ordnance, discarded military munitions, or munitions constituents at defense sites and make such recommendations 

as the panel considers appropriate. 

(Added Pub. L. 99–499, title II, Sec. 211(a)(1)(B), Oct. 17, 1986, 100 Stat. 1719; amended Pub. 

L. 101–510, div. A, title XIV, Sec. 1481(i)(1), Nov. 5, 1990, 104 Stat. 1708; Pub. L. 102–190, div. 

A, title III, Sec. 336(a), Dec. 5, 1991, 105 Stat. 1342; Pub. L. 102–484, div. A, title III, Sec. 

331(b), title X, Sec. 1052(35), Oct. 23, 1992, 106 Stat. 2373, 2501; Pub. L. 103–35, title II, Sec. 

201(d)(6), May 31, 1993, 107 Stat. 99; Pub. L. 103–337, div. A, title III, Sec. 322, 323, Oct. 5, 

1994, 108 Stat. 2711; Pub. L. 104–106, div. A, title III, Sec. 321(a)(1), title XV, Sec. 1504(a)(1), 

div. D, title XLIII, Sec. 4321(b)(22), Feb. 10, 1996, 110 Stat. 251, 513, 673; Pub. L. 104–201, 

div. A, title III, Sec. 329, Sept. 23, 1996, 110 Stat. 2483; Pub. L. 107–107, div. A, title III, Sec. 

314, Dec. 28, 2001, 115 Stat. 1053; Pub. L. 107–217, Sec. 3(b)(17), Aug. 21, 2002, 116 Stat. 1296; 

Pub. L. 107–314, div. A, title III, Secs. 311, 312, 313(c)(2), div. B, title XXVIII, Sec. 2812(c), Dec. 

2, 2002, 116 Stat. 2506, 2508, 2709; Pub. L. 108–375, div. A, title X, Sec. 1084(d)(24), Oct. 28, 

2004, 118 Stat. 2063; Pub. L. 109–163, div. A, title III, Sec. 312(a), Jan. 6, 2006, 119 Stat. 3190; 

Pub. L. 109–284, Sec. 2, Sept. 27, 2006, 120 Stat. 1211; Pub. L. 109–364, div. A, title III, Secs. 

311, 312, Oct. 17, 2006, 120 Stat. 2137; Pub. L. 111–84, div. A, title X, Sec. 1073(a)(28), Oct. 

28, 2009, 123 Stat. 2474; Pub. L. 111–383, div. A, title X, Sec. 1075(b)(46)(B), Jan. 7, 2011, 124 

Stat. 4371.) 

§ 2702. Research, development, and demonstration program 

(a) PROGRAM.—As part of the Defense Environmental Restoration Program, the Secretary of Defense shall carry out a program 

of research, development, and demonstration with respect to hazardous wastes. The program shall be carried out in consultation 

and cooperation with the Administrator and the advisory council 

established under section 311(a)(5) of CERCLA (42 U.S.C. 

9660(a)(5)). The program shall include research, development, and 

demonstration with respect to each of the following: 

(1) Means of reducing the quantities of hazardous waste 

generated by activities and facilities under the jurisdiction of 

the Secretary. 

(2) Methods of treatment, disposal, and management (including recycling and detoxifying) of hazardous waste of the 

types and quantities generated by current and former activities 

of the Secretary and facilities currently and formerly under the 

jurisdiction of the Secretary. 

(3) Identifying more cost-effective technologies for cleanup 

of hazardous substances. 
§ 2703 CH. 160—ENVIRONMENTAL RESTORATION 1560 

(4) Toxicological data collection and methodology on risk of 

exposure to hazardous waste generated by the Department of 

Defense. 

(5) The testing, evaluation, and field demonstration of any 

innovative technology, processes, equipment, or related training devices which may contribute to establishment of new 

methods to control, contain, and treat hazardous substances, to 

be carried out in consultation and cooperation with, and to the 

extent possible in the same manner and standards as, testing, 

evaluation, and field demonstration carried out by the Administrator, acting through the office of technology demonstration 

of the Environmental Protection Agency. 

(b) SPECIAL PERMIT.—The Administrator may use the authorities of section 3005(g) of the Solid Waste Disposal Act (42 U.S.C. 

6925(g)) to issue a permit for testing and evaluation which receives 

support under this section. 

(c) CONTRACTS AND GRANTS.—The Secretary may enter into 

contracts and cooperative agreements with, and make grants to, 

universities, public and private profit and nonprofit entities, and 

other persons to carry out the research, development, and demonstration authorized under this section. Such contracts may be entered into only to the extent that appropriated funds are available 

for that purpose. 

(d) INFORMATION COLLECTION AND DISSEMINATION.— 

(1) IN GENERAL.—The Secretary shall develop, collect, 

evaluate, and disseminate information related to the use (or 

potential use) of the treatment, disposal, and management 

technologies that are researched, developed, and demonstrated 

under this section. 

(2) ROLE OF EPA.—The functions of the Secretary under 

paragraph (1) shall be carried out in cooperation and consultation with the Administrator. To the extent appropriate and 

agreed upon by the Administrator and the Secretary, the Administrator shall evaluate and disseminate such information 

through the office of technology demonstration of the Environmental Protection Agency. 

(Added Pub. L. 99–499, title II, Sec. 211(a)(1)(B), Oct. 17, 1986, 100 Stat. 1721; amended Pub. 

L. 108–375, div. A, title X, Sec. 1084(d)(25), Oct. 28, 2004, 118 Stat. 2063.) 

§ 2703. Environmental restoration accounts 

(a) ESTABLISHMENT OF ACCOUNTS.—There are hereby established in the Department of Defense the following accounts: 

(1) An account to be known as the ‘‘Environmental Restoration Account, Defense’’. 

(2) An account to be known as the ‘‘Environmental Restoration Account, Army’’. 

(3) An account to be known as the ‘‘Environmental Restoration Account, Navy’’. 

(4) An account to be known as the ‘‘Environmental Restoration Account, Air Force’’. 

(5) An account to be known as the ‘‘Environmental Restoration Account, Formerly Used Defense Sites’’. 

(b) PROGRAM ELEMENTS FOR ORDNANCE REMEDIATION.—The 

Secretary of Defense shall establish a program element for remedi-
1561 § 2703 CH. 160—ENVIRONMENTAL RESTORATION 

ation of unexploded ordnance, discarded military munitions, and 

munitions constituents within each environmental restoration account established under subsection (a). In this subsection, the 

terms ‘‘discarded military munitions’’ and ‘‘munitions constituents’’ 

have the meanings given such terms in section 2710 of this title. 

(c) OBLIGATION OF AUTHORIZED AMOUNTS.—(1) Funds authorized for deposit in an account under subsection (a) may be obligated or expended from the account only to carry out the environmental restoration functions of the Secretary of Defense and the 

Secretaries of the military departments under this chapter and 

under any other provision of law. 

(2) Funds authorized for deposit in an account under subsection (a) shall remain available until expended. 

(d) BUDGET REPORTS.—In proposing the budget for any fiscal 

year pursuant to section 1105 of title 31, the President shall set 

forth separately the amounts requested for environmental restoration programs of the Department of Defense and of each of the 

military departments under this chapter and under any other Act. 

(e) CREDIT OF AMOUNTS RECOVERED.—The following amounts 

shall be credited to the appropriate environmental restoration account: 

(1) Amounts recovered under CERCLA for response actions. 

(2) Any other amounts recovered from a contractor, insurer, surety, or other person to reimburse the Department of 

Defense or a military department for any expenditure for environmental response activities. 

(f) PAYMENTS OF FINES AND PENALTIES.—None of the funds appropriated to the Environmental Restoration Account, Defense, for 

fiscal years 1995 through 2010, or to any environmental restoration 

account of a military department for fiscal years 1997 through 

2010, may be used for the payment of a fine or penalty (including 

any supplemental environmental project carried out as part of such 

penalty) imposed against the Department of Defense or a military 

department unless the act or omission for which the fine or penalty 

is imposed arises out of an activity funded by the environmental 

restoration account concerned and the payment of the fine or penalty has been specifically authorized by law. 

(g) SOLE SOURCE OF FUNDS FOR OPERATION AND MONITORING

OF ENVIRONMENTAL REMEDIES.—(1) Except as provided in subsection (h), the sole source of funds for all phases of an environmental remedy at a site under the jurisdiction of the Department 

of Defense or a formerly used defense site shall be the applicable 

environmental restoration account established under subsection (a). 

(2) In this subsection, the term ‘‘environmental remedy’’ has 

the meaning given the term ‘‘remedy’’ in section 101 of CERCLA 

(42 U.S.C. 9601). 

(h) SOLE SOURCE OF FUNDS FOR ENVIRONMENTAL REMEDIATION

AT CERTAIN BASE REALIGNMENT AND CLOSURE SITES.—In the case 

of property disposed of pursuant to a base closure law and subject 

to a covenant that was required to be provided by paragraphs (3) 

and (4) of section 120(h) of CERCLA (42 U.S.C. 9620(h)), the sole 

source of funds for services procured under section 2701(d)(1) of 

this title shall be the applicable Department of Defense base clo-
§ 2704 CH. 160—ENVIRONMENTAL RESTORATION 1562 

sure account. The limitation in this subsection shall expire upon 

the closure of the applicable base closure account. 

(Added Pub. L. 99–499, title II, Sec. 211(a)(1)(B), Oct. 17, 1986, 100 Stat. 1722; amended Pub. 

L. 103–337, div. A, title III, Sec. 321, Oct. 5, 1994, 108 Stat. 2710; Pub. L. 104–106, div. A, 

title III, Sec. 322, Feb. 10, 1996, 110 Stat. 252; Pub. L. 104–201, div. A, title III, Sec. 322(a)(1), 

Sept. 23, 1996, 110 Stat. 2477; Pub. L. 106–65, div. A, title III, Sec. 321, title X, Sec. 1066(a)(27), 

Oct. 5, 1999, 113 Stat. 560, 772; Pub. L. 106–398, Sec. 1 [[div. A], title III, Secs. 311, 312], Oct. 

30, 2000, 114 Stat. 1654, 1654A–53, 1654A–54; Pub. L. 107–107, div. A, title III, Sec. 312, Dec. 

28, 2001, 115 Stat. 1051; Pub. L. 108–136, div. A, title III, Sec. 313(a), Nov. 24, 2003, 117 Stat. 

1430; Pub. L. 108–375, div. A, title X, Sec. 1084(d)(26), Oct. 28, 2004, 118 Stat. 2063; Pub. L. 

109–163, div. A, title III, Sec. 312(b), title X, Sec. 1056(c)(7), Jan. 6, 2006, 119 Stat. 3191, 3439; 

Pub. L. 109–364, div. A, title X, Sec. 1071(a)(23), Oct. 17, 2006, 120 Stat. 2399.) 

§ 2704. Commonly found unregulated hazardous substances 

(a) NOTICE TO HHS.— 

(1) IN GENERAL.—The Secretary of Defense shall notify the 

Secretary of Health and Human Services of the hazardous substances which the Secretary of Defense determines to be the 

most commonly found unregulated hazardous substances at facilities under the Secretary’s jurisdiction. The notification shall 

be of not less than the 25 most widely used such substances. 

(2) DEFINITION.—In this subsection, the term ‘‘unregulated 

hazardous substance’’ means a hazardous substance— 

(A) for which no standard, requirement, criteria, or 

limitation is in effect under the Toxic Substances Control 

Act, the Safe Drinking Water Act, the Clean Air Act, or 

the Clean Water Act; and 

(B) for which no water quality criteria are in effect 

under any provision of the Clean Water Act. 

(b) TOXICOLOGICAL PROFILES.—The Secretary of Health and 

Human Services shall take such steps as necessary to ensure the 

timely preparation of toxicological profiles of each of the substances 

of which the Secretary is notified under subsection (a). The profiles 

of such substances shall include each of the following: 

(1) The examination, summary, and interpretation of available toxicological information and epidemiologic evaluations on 

a hazardous substance in order to ascertain the levels of significant human exposure for the substance and the associated 

acute, subacute, and chronic health effects. 

(2) A determination of whether adequate information on 

the health effects of each substance is available or in the process of development to determine levels of exposure which 

present a significant risk to human health of acute, subacute, 

and chronic health effects. 

(3) Where appropriate, toxicological testing directed toward 

determining the maximum exposure level of a hazardous substance that is safe for humans. 

(c) DOD SUPPORT.—The Secretary of Defense shall transfer to 

the Secretary of Health and Human Services such toxicological 

data, such sums from amounts appropriated to the Department of 

Defense, and such personnel of the Department of Defense as may 

be necessary (1) for the preparation of toxicological profiles under 

subsection (b) or (2) for other health related activities under section 

104(i) of CERCLA (42 U.S.C. 9604(i)). The Secretary of Defense and 

the Secretary of Health and Human Services shall enter into a 

memorandum of understanding regarding the manner in which 
1563 § 2705 CH. 160—ENVIRONMENTAL RESTORATION 

this section shall be carried out, including the manner for transferring funds and personnel and for coordination of activities under 

this section. 

(d) EPA HEALTH ADVISORIES.— 

(1) PREPARATION.—At the request of the Secretary of Defense, the Administrator shall, in a timely manner, prepare 

health advisories on hazardous substances. Such an advisory 

shall be prepared on each hazardous substance— 

(A) for which no advisory exists; 

(B) which is found to threaten drinking water; and 

(C) which is emanating from a facility under the jurisdiction of the Secretary. 

(2) CONTENT OF HEALTH ADVISORIES.—Such health 

advisories shall provide specific advice on the levels of contaminants in drinking water at which adverse health effects would 

not be anticipated and which include a margin of safety so as 

to protect the most sensitive members of the population at 

risk. The advisories shall provide data on one-day, 10-day, and 

longer-term exposure periods where available toxicological data 

exist. 

(3) DOD SUPPORT FOR HEALTH ADVISORIES.—The Secretary 

of Defense shall transfer to the Administrator such toxicological data, such sums from amounts appropriated to the 

Department of Defense, and such personnel of the Department 

of Defense as may be necessary for the preparation of such 

health advisories. The Secretary and the Administrator shall 

enter into a memorandum of understanding regarding the 

manner in which this subsection shall be carried out, including 

the manner for transferring funds and personnel and for coordination of activities under this subsection. 

(e) CROSS REFERENCE.—Section 104(i) of CERCLA (42 U.S.C. 

9604(i)) applies to facilities under the jurisdiction of the Secretary 

of Defense in the manner prescribed in that section. 

(f) FUNCTIONS OF HHS TO BE CARRIED OUT THROUGH

ATSDR.—The functions of the Secretary of Health and Human 

Services under this section shall be carried out through the Administrator of the Agency for Toxic Substances and Disease Registry 

of the Department of Health and Human Services established 

under section 104(i) of CERCLA (42 U.S.C. 9604(i)). 

(Added Pub. L. 99–499, title II, Sec. 211(a)(1)(B), Oct. 17, 1986, 100 Stat. 1722; amended Pub. 

L. 102–25, title VII, Sec. 701(j)(10), Apr. 6, 1991, 105 Stat. 116; Pub. L. 108–375, div. A, title 

X, Sec. 1084(d)(27), Oct. 28, 2004, 118 Stat. 2063.) 

§ 2705. Notice of environmental restoration activities 

(a) EXPEDITED NOTICE.—The Secretary of Defense shall take 

such actions as necessary to ensure that the regional offices of the 

Environmental Protection Agency and appropriate State and local 

authorities for the State in which a facility under the Secretary’s 

jurisdiction is located receive prompt notice of each of the following: 

(1) The discovery of releases or threatened releases of hazardous substances at the facility. 

(2) The extent of the threat to public health and the environment which may be associated with any such release or 

threatened release. 
§ 2705 CH. 160—ENVIRONMENTAL RESTORATION 1564 

(3) Proposals made by the Secretary to carry out response 

actions with respect to any such release or threatened release. 

(4) The initiation of any response action with respect to 

such release or threatened release and the commencement of 

each distinct phase of such activities. 

(b) COMMENT BY EPA AND STATE AND LOCAL AUTHORITIES.— (1) RELEASE NOTICES.—The Secretary shall ensure that the 

Administrator of the Environmental Protection Agency and appropriate State and local officials have an adequate opportunity to comment on notices under paragraphs (1) and (2) of 

subsection (a). 

(2) PROPOSALS FOR RESPONSE ACTIONS.—The Secretary 

shall require that an adequate opportunity for timely review 

and comment be afforded to the Administrator and to appropriate State and local officials after making a proposal referred 

to in subsection (a)(3) and before undertaking an activity or action referred to in subsection (a)(4). The preceding sentence 

does not apply if the action is an emergency removal taken because of imminent and substantial endangerment to human 

health or the environment and consultation would be impractical. 

(c) TECHNICAL REVIEW COMMITTEE.—Whenever possible and 

practical, the Secretary shall establish a technical review committee to review and comment on Department of Defense actions 

and proposed actions with respect to releases or threatened releases of hazardous substances at installations. Members of any 

such committee shall include at least one representative of the Secretary, the Administrator, and appropriate State and local authorities and shall include a public representative of the community involved. 

(d) RESTORATION ADVISORY BOARD.—(1) In lieu of establishing 

a technical review committee under subsection (c), the Secretary 

may permit the establishment of a restoration advisory board in 

connection with any installation (or group of nearby installations) 

where the Secretary is planning or implementing environmental 

restoration activities. 

(2)(A) The Secretary shall prescribe regulations regarding the 

establishment, characteristics, composition, and funding of restoration advisory boards pursuant to this subsection. 

(B) The issuance of regulations under subparagraph (A) shall 

not be a precondition to the establishment of restoration advisory 

boards under this subsection. 

(C) The Federal Advisory Committee Act (5 U.S.C. App.) shall 

not apply to a restoration advisory board established under this 

subsection. 

(3) The Secretary may authorize the commander of an installation (or, if there is no such commander, an appropriate official of 

the Department of Defense designated by the Secretary) to pay routine administrative expenses of a restoration advisory board established for that installation. Such payments shall be made from 

funds available under subsection (g). 

(e) TECHNICAL ASSISTANCE.—(1) The Secretary may, upon the 

request of the technical review committee or restoration advisory 

board for an installation, authorize the commander of the installa-
1565 § 2705 CH. 160—ENVIRONMENTAL RESTORATION 

tion (or, if there is no such commander, an appropriate official of 

the Department of Defense designated by the Secretary) to obtain 

for the committee or advisory board, as the case may be, from private sector sources technical assistance for interpreting scientific 

and engineering issues with regard to the nature of environmental 

hazards at the installation and the restoration activities conducted, 

or proposed to be conducted, at the installation. The commander of 

an installation (or, if there is no such commander, an appropriate 

official of the Department of Defense designated by the Secretary) 

shall use funds made available under subsection (g) for obtaining 

assistance under this paragraph. 

(2) The commander of an installation (or, if there is no such 

commander, an appropriate official of the Department of Defense 

designated by the Secretary) may obtain technical assistance under 

paragraph (1) for a technical review committee or restoration advisory board only if— 

(A) the technical review committee or restoration advisory 

board demonstrates that the Federal, State, and local agencies 

responsible for overseeing environmental restoration at the installation, and available Department of Defense personnel, do 

not have the technical expertise necessary for achieving the objective for which the technical assistance is to be obtained; or 

(B) the technical assistance— 

(i) is likely to contribute to the efficiency, effectiveness, 

or timeliness of environmental restoration activities at the 

installation; and 

(ii) is likely to contribute to community acceptance of 

environmental restoration activities at the installation. 

(f) INVOLVEMENT IN DEFENSE ENVIRONMENTAL RESTORATION

PROGRAM.—If a technical review committee or restoration advisory 

board is established with respect to an installation (or group of installations), the Secretary shall consult with and seek the advice of 

the committee or board on the following issues: 

(1) Identifying environmental restoration activities and 

projects at the installation or installations. 

(2) Monitoring progress on these activities and projects. 

(3) Collecting information regarding restoration priorities 

for the installation or installations. 

(4) Addressing land use, level of restoration, acceptable 

risk, and waste management and technology development 

issues related to environmental restoration at the installation 

or installations. 

(5) Developing environmental restoration strategies for the 

installation or installations. 

(g) FUNDING.—The Secretary shall, to the extent provided in 

appropriations Acts, make funds available for administrative expenses and technical assistance under this section using funds in 

the following accounts: 

(1) In the case of a military installation not approved for 

closure pursuant to a base closure law, the environmental restoration account concerned under section 2703(a) of this title. 

(2) In the case of an installation approved for closure pursuant to such a law, the Department of Defense Base Closure 

Account 1990 established under section 2906(a) of the Defense 
§ 2706 CH. 160—ENVIRONMENTAL RESTORATION 1566 

Base Closure and Realignment Act of 1990 (part A of title 

XXIX of Public Law 101–510; 10 U.S.C. 2687 note). 

(Added Pub. L. 99–499, title II, Sec. 211(a)(1)(B), Oct. 17, 1986, 100 Stat. 1724; amended Pub. 

L. 103–337, div. A, title III, Sec. 326(a)–(c), Oct. 5, 1994, 108 Stat. 2712, 2713; Pub. L. 104– 

106, div. A, title III, Sec. 324(a)–(d)(1), (e), Feb. 10, 1996, 110 Stat. 252, 253, 254; Pub. L. 104– 

201, div. A, title III, Sec. 322(c), Sept. 23, 1996, 110 Stat. 2479; Pub. L. 108–136, div. A, title 

III, Sec. 317(b), title X, Sec. 1043(c)(5), Nov. 24, 2003, 117 Stat. 1432, 1612.) 

§ 2706. Annual reports to Congress 

(a) REPORT ON ENVIRONMENTAL RESTORATION ACTIVITIES.—(1) 

The Secretary of Defense shall submit to the Congress each year, 

not later than 45 days after the date on which the President submits to the Congress the budget for a fiscal year, a report on the 

progress made by the Secretary in carrying out environmental restoration activities at military installations. 

(2) Each such report shall include, with respect to environmental restoration activities for each military installation, the following: 

(A) A statement of the number of sites at which a hazardous substance has been identified. 

(B) A statement of the status of response actions proposed 

for or initiated at the military installation. 

(C) A statement of the total cost estimated for such response actions. 

(D) A statement of the amount of funds obligated by the 

Secretary for such response actions, and the progress made in 

implementing the response actions during the fiscal year preceding the year in which the report is submitted, including an 

explanation of— 

(i) any cost overruns for such response actions, if the 

amount of funds obligated for those response actions exceeds the estimated cost for those response actions by the 

greater of 15 percent of the estimated cost or $10,000,000; 

and 

(ii) any deviation in the schedule (including a milestone schedule specified in an agreement, order, or mandate) for such response actions of more than 180 days. 

(E) A statement of the amount of funds allocated by the 

Secretary for, and the anticipated progress in implementing, 

such response actions during the fiscal year in which the report is submitted. 

(F) A statement of the amount of funds requested for such 

response actions for the five fiscal years following the fiscal 

year in which the report is submitted, and the anticipated 

progress in implementing such response actions for the fiscal 

year for which the budget is submitted. 

(G) A statement of the total costs incurred for such response actions as of the date of the submission of the report. 

(H) A statement of the estimated cost of completing all environmental restoration activities required with respect to the 

military installation, including, where relevant, the estimated 

cost of such activities in each of the five fiscal years following 

the fiscal year in which the report is submitted. 
1567 § 2706 CH. 160—ENVIRONMENTAL RESTORATION 

(I) A statement of the estimated schedule for completing 

all environmental restoration activities at the military installation. 

(J) A statement of the activities, if any, including expenditures for administrative expenses and technical assistance 

under section 2705 of this title, of the technical review committee or restoration advisory board established for the installation under such section during the preceding fiscal year. 

(b) REPORT ON ENVIRONMENTAL QUALITY PROGRAMS AND

OTHER ENVIRONMENTAL ACTIVITIES.—(1) The Secretary of Defense 

shall submit to Congress each year, not later than 45 days after 

the date on which the President submits to Congress the budget for 

a fiscal year, a report on the progress made in carrying out activities under the environmental quality programs of the Department 

of Defense and the military departments. 

(2) Each report shall include the following: 

(A) A description of the environmental quality program of 

the Department of Defense, and of each of the military departments, during the period consisting of the four fiscal years preceding the fiscal year in which the report is submitted, the fiscal year in which the report is submitted, and the fiscal year 

following the fiscal year in which the report is submitted. 

(B) For each of the major activities under the environmental quality programs: 

(i) A specification of the amount expended, or proposed 

to be expended, in each fiscal year of the period covered by 

the report. 

(ii) An explanation for any significant change in the 

aggregate amount to be expended in the fiscal year in 

which the report is submitted, and in the following fiscal 

year, when compared with the fiscal year preceding each 

such fiscal year. 

(iii) An assessment of the manner in which the scope 

of the activities have changed over the course of the period 

covered by the report. 

(C) A summary of the major achievements of the environmental quality programs and of any major problems with the 

programs. 

(D) A summary of fines and penalties imposed or assessed 

against the Department of Defense and the military departments under Federal, State, or local environmental laws during the fiscal year in which the report is submitted and the 

four preceding fiscal years, which summary shall include— 

(i) a trend analysis of such fines and penalties for military installations inside and outside the United States; 

and 

(ii) a list of such fines or penalties that exceeded 

$1,000,000 and the provisions of law under which such 

fines or penalties were imposed or assessed. 

(E) A statement of the amounts expended, and anticipated 

to be expended, during the period covered by the report for any 

activities overseas relating to the environment, including 

amounts for activities relating to environmental remediation, 
§ 2706 CH. 160—ENVIRONMENTAL RESTORATION 1568 

compliance, conservation, pollution prevention, and environmental technology. 

(c) REPORT ON ENVIRONMENTAL TECHNOLOGY PROGRAM.—(1) 

The Secretary of Defense shall submit to Congress each year, not 

later than 45 days after the date on which the President submits 

to Congress the budget for a fiscal year, a report on the progress 

made by the Department of Defense in achieving the objectives and 

goals of its environmental technology program during the preceding 

fiscal year and an overall trend analysis for the program covering 

the previous four fiscal years. 

(2) Each such report shall include, with respect to each project 

under the environmental technology program of the Department of 

Defense, the following: 

(A) The performance objectives established for the project 

for the fiscal year and an assessment of the performance 

achieved with respect to the project in light of performance indicators for the project. 

(B) A description of the extent to which the project met the 

performance objectives established for the project for the fiscal 

year. 

(C) If a project did not meet the performance objectives for 

the project for the fiscal year— 

(i) an explanation for the failure of the project to meet 

the performance objectives; and 

(ii) a modified schedule for meeting the performance 

objectives or, if a performance objective is determined to be 

impracticable or infeasible to meet, a statement of alternative actions to be taken with respect to the project. 

(d) DEFINITIONS.—In this section: 

(1) The term ‘‘military installation’’ has the meaning given 

such term in section 2687(e) of this title, except that such term 

does not include a homeport facility for any ship and includes— 

(A) each facility or site owned by, leased to, or otherwise possessed by the United States and under the jurisdiction of the Secretary of Defense; 

(B) each facility or site which was under the jurisdiction of the Secretary and owned by, leased to, or otherwise 

possessed by the United States at the time of actions leading to contamination by hazardous substances; and 

(C) each facility or site at which the Secretary is conducting environmental restoration activities. 

(2) The term ‘‘environmental quality program’’ means a 

program of activities relating to environmental compliance, 

conservation, pollution prevention, and such other activities relating to environmental quality as the Secretary concerned 

may designate for purposes of the program. 

(3) The term ‘‘major activities’’, with respect to an environmental quality program, means the following activities under 

the program: 

(A) Environmental compliance activities. 

(B) Conservation activities. 

(C) Pollution prevention activities. 
1569 § 2708 CH. 160—ENVIRONMENTAL RESTORATION 

(Added Pub. L. 99–499, title II, Sec. 211(a)(1)(B), Oct. 17, 1986, 100 Stat. 1724; amended Pub. 

L. 101–189, div. A, title III, Sec. 357(a)(1), (2)(A), Nov. 29, 1989, 103 Stat. 1426, 1427; Pub. L. 

101–510, div. A, title III, Sec. 341, 342(a), Nov. 5, 1990, 104 Stat. 1536, 1537; Pub. L. 103–160, 

div. A, title X, Sec. 1001(a)–(d), Nov. 30, 1993, 107 Stat. 1742–1744; Pub. L. 103–337, div. A, 

title X, Sec. 1070(b)(9), Oct. 5, 1994, 108 Stat. 2857; Pub. L. 104–106, div, A, title III, Sec. 324(f), 

Feb. 10, 1996, 110 Stat. 254; Pub. L. 104–201, div. A, title III, Sec. 321, Sept. 23, 1996, 1210 

Stat. 2477; Pub. L. 105–85, div. A, title III, Secs. 344(a), 345, Nov. 18, 1997, 111 Stat. 1688; 

Pub. L. 105–261, div. A, title III, Sec. 325, Oct. 17, 1998, 112 Stat. 1965; Pub. L. 106–65, div. 

A, title III, Secs. 322, 323(c)(1), Oct. 5, 1999, 113 Stat. 560, 563; Pub. L. 107–107, div. A, title 

III, Sec. 315, Dec. 28, 2001, 115 Stat. 1053; Pub. L. 109–163, div. A, title III, Sec. 311, Jan. 

6, 2006, 119 Stat. 3190.) 

§ 2707. Environmental restoration projects for environmental responses 

(a) ENVIRONMENTAL RESTORATION PROJECTS AUTHORIZED.— 

The Secretary of Defense or the Secretary of a military department 

may carry out an environmental restoration project if that Secretary determines that the project is necessary to carry out a response under this chapter or CERCLA. 

(b) TREATMENT OF PROJECT.—Any construction, development, 

conversion, or extension of a structure, and any installation of 

equipment, that is included in an environmental restoration project 

under this section may not be considered military construction (as 

that term is defined in section 2801(a) of this title). 

(c) SOURCE OF FUNDS.—Funds authorized for deposit in an account established by section 2703(a) of this title shall be the only 

source of funds to conduct an environmental restoration project 

under this section. 

(d) ENVIRONMENTAL RESTORATION PROJECT DEFINED.—In this 

section, the term ‘‘environmental restoration project’’ includes any 

construction, development, conversion, or extension of a structure, 

or installation of equipment, in direct support of a response. 

(Added Pub. L. 107–314, div. A, title III, Sec. 313(a)(2), Dec. 2, 2002, 116 Stat. 2507.) 

§ 2708. Contracts for handling hazardous waste from defense facilities 

(a) REIMBURSEMENT REQUIREMENT.—(1) Each contract or subcontract to which this section applies shall provide that, upon receipt of hazardous wastes properly characterized pursuant to applicable laws and regulations, the contractor or subcontractor will reimburse the Federal Government for all liabilities incurred by, penalties assessed against, costs incurred by, and damages suffered by, 

the Government that are caused by— 

(A) the contractor’s or subcontractor’s breach of any term 

or provision of the contract or subcontract; and 

(B) any negligent or willful act or omission of the contractor or subcontractor, or the employees of the contractor or 

subcontractor, in the performance of the contract or subcontract. 

(2) Not later than 30 days after such a contract or subcontract 

is awarded, the contractor or subcontractor shall demonstrate that 

the contractor or subcontractor will reimburse the Federal Government as provided in paragraph (1). 

(b) APPLICABILITY.—(1) Except as provided in paragraph (2), 

this section applies to each contract entered into by the Secretary 

of Defense or the Secretary of a military department, and any subcontract under any such contract, with an owner or operator of a 
§ 2709 CH. 160—ENVIRONMENTAL RESTORATION 1570 

hazardous waste treatment or disposal facility during fiscal years 

1992 through 1996 for the offsite treatment or disposal of hazardous wastes from a facility under the jurisdiction of the Secretary of Defense. 

(2) This section does not apply to— 

(A) any contract or subcontract to perform remedial action 

or corrective action under the Defense Environmental Restoration Program, other programs or activities of the Department 

of Defense, or authorized State hazardous waste programs; 

(B) any contract or subcontract under which the generation of the hazardous waste to be disposed of is incidental to 

the performance of the contract; or 

(C) any contract or subcontract to dispose of ammunition 

or solid rocket motors. 

(c) EXCEPTION TO REIMBURSEMENT REQUIREMENT.—Notwithstanding subsection (a), in the case of any contract to which this 

section applies, if the Secretary of Defense or the Secretary of the 

military department concerned determines that— 

(1) there is only one responsible offeror or there is no responsible offeror willing to provide the reimbursement required 

by subsection (a) for such contract; or 

(2) failure to award the contract would place the facility 

concerned in violation of any requirement of the Solid Waste 

Disposal Act (42 U.S.C. 6901 et seq.), 

then the contract may be awarded without including the reimbursement provision required by subsection (a). 

(d) DEFINITIONS.—In this section: 

(1) The term ‘‘hazardous waste’’ has the meaning given 

that term by section 1004(5) of the Solid Waste Disposal Act 

(42 U.S.C. 6903(5)), except that such term also includes polychlorinated biphenyls. 

(2) The term ‘‘remedial action’’ has the meaning given that 

term by section 101(24) of the Comprehensive Environmental 

Response, Compensation, and Liability Act of 1980 (42 U.S.C. 

9601(24)). 

(3) The term ‘‘corrective action’’ has the meaning given 

that term under section 3004(u) of the Solid Waste Disposal 

Act (42 U.S.C. 6924(u)). 

(4) The term ‘‘polychlorinated biphenyls’’ has the meaning 

given that term under section 6(e) of the Toxic Substances 

Control Act (15 U.S.C. 2605(e)). 

(e) EFFECT ON LIABILITY.—Nothing in this section shall affect 

the liability of the Federal Government under any Federal or State 

law or under common law. 

(Added Pub. L. 102–190, div. A, title III, Sec. 331(a)(1), Dec. 5, 1991, 105 Stat. 1339; amended 

Pub. L. 102–484, div. A, title III, Sec. 321, title X, Sec. 1052(36), Oct. 23, 1992, 106 Stat. 2365, 

2501; Pub. L. 103–160, div. A, title X, Sec. 1004, Nov. 30, 1993, 107 Stat. 1748.) 

§ 2709. Investment control process for environmental technologies 

(a) INVESTMENT CONTROL PROCESS.—The Secretary of Defense 

shall ensure that the technology planning process developed to implement section 2501 of this title and section 270(b) of the National 

Defense Authorization Act for Fiscal Year 1997 (Public Law 104– 
1571 § 2710 CH. 160—ENVIRONMENTAL RESTORATION 

201; 110 Stat. 2469) provides for an investment control process for 

the selection, prioritization, management, and evaluation of environmental technologies by the Department of Defense, the military 

departments, and the Defense Agencies. 

(b) PLANNING AND EVALUATION.—The environmental technology investment control process required by subsection (a) shall 

provide, at a minimum, for the following: 

(1) The active participation by end-users of environmental 

technology, including the officials responsible for the environmental security programs of the Department of Defense and 

the military departments, in the selection and prioritization of 

environmental technologies. 

(2) The development of measurable performance goals and 

objectives for the management and development of environmental technologies and specific mechanisms for assuring the 

achievement of the goals and objectives. 

(3) Annual performance reviews to determine whether the 

goals and objectives have been achieved and to take appropriate action in the event that they are not achieved. 

(Added Pub. L. 106–65, div. A, title III, Sec. 323(b)(1), Oct. 5, 1999, 113 Stat. 562.) 

§ 2710. Inventory of unexploded ordnance, discarded military munitions, and munitions constituents at defense sites (other than operational ranges) 

(a) INVENTORY REQUIRED.—(1) The Secretary of Defense shall 

develop and maintain an inventory of defense sites that are known 

or suspected to contain unexploded ordnance, discarded military 

munitions, or munitions constituents. 

(2) The information in the inventory for each defense site shall 

include, at a minimum, the following: 

(A) A unique identifier for the defense site. 

(B) An appropriate record showing the location, boundaries, and extent of the defense site, including identification of 

the State and political subdivisions of the State, including the 

county, where applicable, in which the defense site is located 

and any Tribal lands encompassed by the defense site. 

(C) Known persons and entities, other than a military department, with any current ownership interest or control of 

lands encompassed by the defense site. 

(D) Any restrictions or other land use controls currently in 

place at the defense site that might affect the potential for 

public and environmental exposure to the unexploded ordnance, discarded military munitions, or munitions constituents. 

(b) SITE PRIORITIZATION.—(1) The Secretary shall develop, in 

consultation with representatives of the States and Indian Tribes, 

a proposed protocol for assigning to each defense site a relative priority for response activities related to unexploded ordnance, discarded military munitions, and munitions constituents based on 

the overall conditions at the defense site. After public notice and 

comment on the proposed protocol, the Secretary shall issue a final 

protocol and shall apply the protocol to defense sites listed on the 

inventory. The level of response priority assigned the site shall be 

included with the information required by subsection (a)(2). 
§ 2710 CH. 160—ENVIRONMENTAL RESTORATION 1572 

(2) In assigning the response priority for a defense site on the 

inventory, the Secretary shall primarily consider factors relating to 

safety and environmental hazard potential, such as the following: 

(A) Whether there are known, versus suspected, 

unexploded ordnance, discarded military munitions, or munitions constituents on all or any portion of the defense site and 

the types of unexploded ordnance, discarded military munitions, or munitions constituents present or suspected to be 

present. 

(B) Whether public access to the defense site is controlled, 

and the effectiveness of these controls. 

(C) The potential for direct human contact with 

unexploded ordnance, discarded military munitions, or munitions constituents at the defense site and evidence of people 

entering the site. 

(D) Whether a response action has been or is being undertaken at the defense site under the Formerly Used Defense 

Sites program or other program. 

(E) The planned or mandated dates for transfer of the defense site from military control. 

(F) The extent of any documented incidents involving 

unexploded ordnance, discarded military munitions, or munitions constituents at or from the defense site, including incidents involving explosions, discoveries, injuries, reports, and 

investigations. 

(G) The potential for drinking water contamination or the 

release of munitions constituents into the air. 

(H) The potential for destruction of sensitive ecosystems 

and damage to natural resources. 

(3) The priority assigned to a defense site included on the inventory shall not impair, alter, or diminish any applicable Federal 

or State authority to establish requirements for the investigation 

of, and response to, environmental problems at the defense site. 

(c) UPDATES AND AVAILABILITY.—(1) The Secretary shall annually update the inventory and site prioritization list to reflect new 

information that becomes available. The inventory shall be available in published and electronic form. 

(2) The Secretary shall work with communities adjacent to a 

defense site to provide information concerning conditions at the site 

and response activities. At a minimum, the Secretary shall provide 

the site inventory information and site prioritization list to appropriate Federal, State, tribal, and local officials, and, to the extent 

the Secretary considers appropriate, to civil defense or emergency 

management agencies and the public. 

(d) EXCEPTIONS.—This section does not apply to the following: 

(1) Any locations outside the United States. 

(2) The presence of military munitions resulting from combat operations. 

(3) Operating storage and manufacturing facilities. 

(4) Operational ranges. 

(e) DEFINITIONS.—In this section: 

(1) The term ‘‘defense site’’ applies to locations that are or 

were owned by, leased to, or otherwise possessed or used by 

the Department of Defense. The term does not include any 
1573 § 2710 CH. 160—ENVIRONMENTAL RESTORATION 

operational range, operating storage or manufacturing facility, 

or facility that is used for or was permitted for the treatment 

or disposal of military munitions. 

(2) The term ‘‘discarded military munitions’’ means military munitions that have been abandoned without proper disposal or removed from storage in a military magazine or other 

storage area for the purpose of disposal. The term does not include unexploded ordnance, military munitions that are being 

held for future use or planned disposal, or military munitions 

that have been properly disposed of, consistent with applicable 

environmental laws and regulations. 

(3) The term ‘‘munitions constituents’’ means any materials originating from unexploded ordnance, discarded military 

munitions, or other military munitions, including explosive and 

nonexplosive materials, and emission, degradation, or breakdown elements of such ordnance or munitions. 

(4) The term ‘‘possessions’’ includes Johnston Atoll, Kingman Reef, Midway Island, Nassau Island, Palmyra Island, and 

Wake Island. 

(5) The term ‘‘Secretary’’ means the Secretary of Defense. 

(6) The term ‘‘State’’ means the several States, the District 

of Columbia, the Commonwealth of Puerto Rico, the Commonwealth of the Northern Mariana Islands, and the territories 

and possessions. 

(7) The term ‘‘United States’’, in a geographic sense, means 

the States, territories, and possessions and associated navigable waters, contiguous zones, and ocean waters of which the 

natural resources are under the exclusive management authority of the United States. 

(Added Pub. L. 107–107, div. A, title III, Sec. 311(a)(1), Dec. 28, 2001, 115 Stat. 1048; amended 

Pub. L. 108–136, div. A, title X, Sec. 1042(b), Nov. 24, 2003, 117 Stat. 1610; Pub. L. 111–84, 

div. A, title III, Sec. 318(a), Oct. 28, 2009, 123 Stat. 2250.) 
1574 

CHAPTER 161—PROPERTY RECORDS AND REPORT OF 

THEFT OR LOSS OF CERTAIN PROPERTY 

Sec. 

2721. Property records: maintenance on quantitative and monetary basis. 

2722. Theft or loss of ammunition, destructive devices, and explosives: report to 

Secretary of the Treasury. 

2723. Notice to congressional committees of certain security and counterintelligence failures within defense programs. 

§ 2721. Property records: maintenance on quantitative and 

monetary basis 

(a) Under regulations prescribed by him, the Secretary of Defense shall have the records of the fixed property, installations, 

major equipment items, and stored supplies of the military departments maintained on both a quantitative and a monetary basis, so 

far as practicable. 

(b) The regulations prescribed pursuant to subsection (a) shall 

include a requirement that the records maintained under such subsection— 

(1) to the extent practicable, provide up-to-date information on all items in the inventory of the Department of Defense; 

(2) indicate whether the inventory of each item is sufficient 

or excessive in relation to the needs of the Department for that 

item; and 

(3) permit the Secretary of Defense to include in the budget submitted to Congress under section 1105 of title 31 for each 

fiscal year, information relating to— 

(A) the amounts proposed for each appropriation account in such budget for inventory purchases of the Department of Defense; and 

(B) the amounts obligated for such inventory purchases out of the corresponding appropriations account for 

the preceding fiscal year. 

(Aug. 10, 1956, ch. 1041, 70A Stat. 152, Sec. 2701; renumbered Sec. 2721, Pub. L. 99–499, title 

II, Sec. 211(a)(1)(A), Oct. 17, 1986, 100 Stat. 1719; amended Pub. L. 101–510, div. A, title XIII, 

Sec. 1322(a)(12), Nov. 5, 1990, 104 Stat. 1671; Pub. L. 102–190, div. A, title III, Sec. 347(b), 

title X, Sec. 1061(a)(17)(A), Dec. 5, 1991, 105 Stat. 1347, 1473.) 

§ 2722. Theft or loss of ammunition, destructive devices, and 

explosives: report to Secretary of the Treasury 

(a) IN GENERAL.—The Secretary of Defense shall report the 

theft or other loss of any ammunition, destructive device, or explosive material from the stocks of the Department of Defense to the 

Secretary of the Treasury within 72 hours, if possible, after the discovery of such theft or loss. 

(b) EXCLUSION FOR CERTAIN ITEMS.—The Secretary of Defense 
1575 § 2723 CH. 161—PROPERTY RECORDS & REPORT OF THEFT 

may exclude from the reporting requirement under subsection (a) 

any item referred to in that subsection if— 

(1) the Secretary determines that the item represents a 

low risk of danger to the public and would be of minimal utility 

to any person who may illegally receive such item; and 

(2) the exclusion of such item is specified as being excluded 

from the reporting requirement in a memorandum of agreement between the Secretary of Defense and the Secretary of 

the Treasury. 

(c) DEFINITIONS.—In this section: 

(1) The term ‘‘explosive material’’ means explosives, blasting agents, and detonators. 

(2) The terms ‘‘destructive device’’ and ‘‘ammunition’’ have 

the meanings given those terms by paragraphs (4) and (17), respectively, of section 921(a) of title 18. 

(Added Pub. L. 100–456, div. A, title III, Sec. 344(a), Sept. 29, 1988, 102 Stat. 1961; amended 

Pub. L. 109–364, div. A, title X, Sec. 1071(a)(24), Oct. 17, 2006, 120 Stat. 2399.) 

§ 2723. Notice to congressional committees of certain security and counterintelligence failures within defense programs 

(a) REQUIRED NOTIFICATION.—The Secretary of Defense shall 

submit to the Committees on Armed Services of the Senate and 

House of Representatives a notification of each security or counterintelligence failure or compromise of classified information relating 

to any defense operation, system, or technology of the United 

States that the Secretary considers likely to cause significant harm 

or damage to the national security interests of the United States. 

The Secretary shall consult with the Director of National Intelligence and the Director of the Federal Bureau of Investigation, as 

appropriate, before submitting any such notification. 

(b) MANNER OF NOTIFICATION.—Notification of a failure or compromise of classified information under subsection (a) shall be provided, in accordance with the procedures established pursuant to 

subsection (c), not later than 30 days after the date on which the 

Department of Defense determines that the failure or compromise 

has taken place. 

(c) PROCEDURES.—The Secretary of Defense and the Committees on Armed Services of the Senate and House of Representatives 

shall each establish such procedures as may be necessary to protect 

from unauthorized disclosure classified information, information relating to intelligence sources and methods, and sensitive law enforcement information that is submitted to those committees pursuant to this section and that are otherwise necessary to carry out 

the provisions of this section. 

(d) STATUTORY CONSTRUCTION.—(1) Nothing in this section 

shall be construed as authority to withhold any information from 

the Committees on Armed Services of the Senate and House of 

Representatives on the grounds that providing the information to 

those committees would constitute the unauthorized disclosure of 

classified information, information relating to intelligence sources 

and methods, or sensitive law enforcement information. 

(2) Nothing in this section shall be construed to modify or supersede any other requirement to report information on intelligence 
§ 2723 CH. 161—PROPERTY RECORDS & REPORT OF THEFT 1576 

activities to the Congress, including the requirement under section 

501 of the National Security Act of 1947 (50 U.S.C. 413). 

(Added Pub. L. 106–65, div. A, title X, Sec. 1042(a), Oct. 5, 1999, 113 Stat. 759; amended Pub. 

L. 110–181, div. A, title IX, Sec. 931(a)(13), Jan. 28, 2008, 122 Stat. 285; Pub. L. 110–417, [div. 

A], title IX, Sec. 932(a)(12), Oct. 14, 2008, 122 Stat. 4576; Pub. L. 111–84, div. A, title X, Sec. 

1073(c)(10), Oct. 28, 2009, 123 Stat. 2475.) 
1577 

CHAPTER 163—MILITARY CLAIMS 

Sec. 

2731. Definition. 

2732. Payment of claims: availability of appropriations. 

2733. Property loss; personal injury or death: incident to noncombat activities of 

Department of Army, Navy, or Air Force. 

2734. Property loss; personal injury or death: incident to noncombat activities of 

the armed forces; foreign countries. 

2734a. Property loss; personal injury or death: incident to noncombat activities of 

armed forces in foreign countries; international agreements. 

2734b. Property loss; personal injury or death: incident to activities of armed 

forces of foreign countries in United States; international agreements. 

2735. Settlement: final and conclusive. 

2736. Property loss; personal injury or death: advance payment. 

2737. Property loss; personal injury or death: incident to use of property of the 

United States and not cognizable under other law. 

2738. Property loss: reimbursement of members for certain losses of household 

effects caused by hostile action. 

2739. Amounts recovered from third parties for loss or damage to personal property shipped or stored at Government expense: crediting to appropriations. 

2740. Property loss: reimbursement of members and civilian employees for full 

replacement value of household effects when contractor reimbursement 

not available. 

§ 2731. Definition 

In this chapter, ‘‘settle’’ means consider, ascertain, adjust, determine, and dispose of a claim, whether by full or partial allowance or by disallowance. 

(Aug. 10, 1956, ch. 1041, 70A Stat. 152.) 

§ 2732. Payment of claims: availability of appropriations 

Appropriations available to the Department of Defense for operation and maintenance may be used for payment of claims authorized by law to be paid by the Department of Defense (except 

for civil functions), including— 

(1) claims for damages arising under training contracts 

with carriers; and 

(2) repayment of amounts determined by the Secretary 

concerned to have been erroneously collected— 

(A) from military and civilian personnel of the Department of Defense; or 

(B) from States or territories or the District of Columbia (or members of the National Guard units thereof). 

(Added Pub. L. 101–510, div. A, title XIV, Sec. 1481(j)(1), Nov. 5, 1990, 104 Stat. 1708.) 

§ 2733. Property loss; personal injury or death: incident to 

noncombat activities of Department of Army, Navy, 

or Air Force 

(a) Under such regulations as the Secretary concerned may 

prescribe, he, or, subject to appeal to him, the Judge Advocate Gen-
§ 2733 CH. 163—MILITARY CLAIMS 1578 

eral of an armed force under his jurisdiction, or the chief Counsel 

of the Coast Guard, as appropriate, if designated by him, may settle, and pay in an amount not more than $100,000, a claim against 

the United States for— 

(1) damage to or loss of real property, including damage or 

loss incident to use and occupancy; 

(2) damage to or loss of personal property, including property bailed to the United States and including registered or insured mail damaged, lost, or destroyed by a criminal act while 

in the possession of the Army, Navy, Air Force, Marine Corps, 

or Coast Guard, as the case may be; or 

(3) personal injury or death; 

either caused by a civilian officer or employee of that department, 

or the Coast Guard, or a member of the Army, Navy, Air Force, 

Marine Corps, or Coast Guard, as the case may be, acting within 

the scope of his employment, or otherwise incident to noncombat 

activities of that department, or the Coast Guard. 

(b) A claim may be allowed under subsection (a) only if— 

(1) it is presented in writing within two years after it accrues, except that if the claim accrues in time of war or armed 

conflict or if such a war or armed conflict intervenes within 

two years after it accrues, and if good cause is shown, the 

claim may be presented not later than two years after the war 

or armed conflict is terminated; 

(2) it is not covered by section 2734 of this title or section 

2672 of title 28; 

(3) it is not for personal injury or death of such a member 

or civilian officer or employee whose injury or death is incident 

to his service; 

(4) the damage to, or loss of, property, or the personal injury or death, was not caused wholly or partly by a negligent 

or wrongful act of the claimant, his agent, or his employee; or, 

if so caused, allowed only to the extent that the law of the 

place where the act or omission complained of occurred would 

permit recovery from a private individual under like circumstances; and 

(5) it is substantiated as prescribed in regulations of the 

Secretary concerned. 

For the purposes of clause (1), the dates of the beginning and ending of an armed conflict are the dates established by concurrent 

resolution of Congress or by a determination of the President. 

(c) Payment may not be made under this section for reimbursement for medical, hospital, or burial services furnished at the expense of the United States. 

(d) If the Secretary concerned considers that a claim in excess 

of $100,000 is meritorious, and the claim otherwise is payable 

under this section, the Secretary may pay the claimant $100,000 

and report any meritorious amount in excess of $100,000 to the 

Secretary of the Treasury for payment under section 1304 of title 

31. 

(e) Except as provided in subsection (d), no claim may be paid 

under this section unless the amount tendered is accepted by the 

claimant in full satisfaction. 
1579 § 2734 CH. 163—MILITARY CLAIMS 

(f) For the purposes of this section, a member of the National 

Oceanic and Atmospheric Administration or of the Public Health 

Service who is serving with the Navy or Marine Corps shall be 

treated as if he were a member of that armed force. 

(g) Under regulations prescribed by the Secretary concerned, 

an officer or employee under the jurisdiction of the Secretary may 

settle a claim that otherwise would be payable under this section 

in an amount not to exceed $25,000. A decision of the officer or employee who makes a final settlement decision under this section 

may be appealed by the claimant to the Secretary concerned or an 

officer or employee designated by the Secretary for that purpose. 

(h) Under such regulations as the Secretary of Defense may 

prescribe, he or his designee has the same authority as the Secretary of a military department under this section with respect to 

the settlement of claims based on damage, loss, personal injury, or 

death caused by a civilian officer or employee of the Department 

of Defense acting within the scope of his employment or otherwise 

incident to noncombat activities of that department. 

(Aug. 10, 1956, ch. 1041, 70A Stat. 153; Pub. L. 85–729, Sec. 1, Aug. 23, 1958, 72 Stat. 813; 

Pub. L. 85–861, Sec. 1(54), Sept. 2, 1958, 72 Stat. 1461; Pub. L. 89–718, Sec. 8(a), Nov. 2, 1966, 

80 Stat. 1117; Pub. L. 90–522, Sept. 26, 1968, 82 Stat. 875; Pub. L. 90–525, Sec. 1, 3–5, Sept. 

26, 1968, 82 Stat. 877, 878; Pub. L. 91–312, Sec. 2, July 8, 1970, 84 Stat. 412; Pub. L. 93–336, 

Sec. 1, July 8, 1974, 88 Stat. 291; Pub. L. 96–513, title V, Sec. 511(94), Dec. 12, 1980, 94 Stat. 

2928; Pub. L. 98–564, Sec. 1, Oct. 30, 1984, 98 Stat. 2918; Pub. L. 104–316, title II, Sec. 202(e), 

Oct. 19, 1996, 110 Stat. 3842.) 

§ 2734. Property loss; personal injury or death: incident to 

noncombat activities of the armed forces; foreign 

countries 

(a) To promote and to maintain friendly relations through the 

prompt settlement of meritorious claims, the Secretary concerned, 

or an officer or employee designated by the Secretary, may appoint, 

under such regulations as the Secretary may prescribe, one or more 

claims commissions, each composed of one or more officers or employees or combination of officers or employees of the armed forces, 

to settle and pay in an amount not more than $100,000, a claim 

against the United States for— 

(1) damage to, or loss of, real property of any foreign country or of any political subdivision or inhabitant of a foreign 

country, including damage or loss incident to use and occupancy; 

(2) damage to, or loss of, personal property of any foreign 

country or of any political subdivision or inhabitant of a foreign 

country, including property bailed to the United States; or 

(3) personal injury to, or death of, any inhabitant of a foreign country; 

if the damage, loss, personal injury, or death occurs outside the 

United States, or the Commonwealths or possessions, and is caused 

by, or is otherwise incident to noncombat activities of, the armed 

forces under his jurisdiction, or is caused by a member thereof or 

by a civilian employee of the military department concerned or the 

Coast Guard, as the case may be. The claim of an insured, but not 

that of a subrogee, may be considered under this subsection. In this 

section, ‘‘foreign country’’ includes any place under the jurisdiction 

of the United States in a foreign country. An officer or employee 

may serve on a claims commission under the jurisdiction of another 
§ 2734 CH. 163—MILITARY CLAIMS 1580 

armed force only with the consent of the Secretary of his department, or his designee, but shall perform his duties under regulations of the department appointing the commission. 

(b) A claim may be allowed under subsection (a) only if— 

(1) it is presented within two years after it accrues; 

(2) in the case of a national of a country at war with the 

United States, or of any ally of that country, the claimant is 

determined by the commission or by the local military commander to be friendly to the United States; and 

(3) it did not arise from action by an enemy or result directly or indirectly from an act of the armed forces of the 

United States in combat, except that a claim may be allowed 

if it arises from an accident or malfunction incident to the operation of an aircraft of the armed forces of the United States, 

including its airborne ordnance, indirectly related to combat, 

and occurring while preparing for, going to, or returning from 

a combat mission. 

(c) The Secretary concerned may appoint any officer or employee under the jurisdiction of the Secretary to act as an approval 

authority for claims determined to be allowable under subsection 

(a) in an amount in excess of $10,000. 

(d) If the Secretary concerned considers that a claim in excess 

of $100,000 is meritorious, and the claim otherwise is payable 

under this section, the Secretary may pay the claimant $100,000 

and report any meritorious amount in excess of $100,000 to the 

Secretary of the Treasury for payment under section 1304 of title 

31. 

(e) Except as provided in subsection (d), no claim may be paid 

under this section unless the amount tendered is accepted by the 

claimant in full satisfaction. 

(f) Upon the request of the department concerned, a claim arising in that department and covered by subsection (a) may be settled and paid by a commission appointed under subsection (a) and 

composed of officers of an armed force under the jurisdiction of another department. 

(g) Payment of claims against the Coast Guard arising while 

it is operating as a service in the Department of Homeland Security shall be made out of the appropriation for the operating expenses of the Coast Guard. 

(h) The Secretary of Defense may designate any claims commission appointed under subsection (a) to settle and pay, as provided in this section, claims for damage caused by a civilian employee of the Department of Defense other than an employee of a 

military department. Payments of claims under this subsection 

shall be made from appropriations as provided in section 2732 of 

this title. 

(Aug. 10, 1956, ch. 1041, 70A Stat. 154; Sept. 2, 1958, Pub. L. 85–861, Sec. 1(55), 72 Stat. 1461; 

Sept. 1, 1959, Pub. L. 86–223, Sec. 1(1), 73 Stat. 453; Apr. 8, 1960, Pub. L. 86–411, 74 Stat. 

16; Sept. 26, 1968, Pub. L. 90–521, Sec. 1, 3, 82 Stat. 874; July 8, 1970, Pub. L. 91–312, Sec. 

1, 84 Stat. 412; July 8, 1974, Pub. L. 93–336, Sec. 2, 88 Stat. 292; Dec. 12, 1980, Pub. L. 96– 

513, title V, Sec. 511(95), 94 Stat. 2928; Oct. 30, 1984, Pub. L. 98–564, Sec. 2, 98 Stat. 2918; 

Nov. 5, 1990, Pub. L. 101–510, div. A, title XIV, Sec. 1481(j)(4)(A), 104 Stat. 1709; Oct. 19, 1996, 

Pub. L. 104–316, title II, Sec. 202(e), 110 Stat. 3842; Pub. L. 107–296, title XVII, Sec. 1704(b)(1), 

Nov. 25, 2002, 116 Stat. 2314; Pub. L. 109–163, div. A, title X, Sec. 1057(a)(5), Jan. 6, 2006, 

119 Stat. 3440.) 
1581 § 2734b CH. 163—MILITARY CLAIMS 

§ 2734a. Property loss; personal injury or death: incident to 

noncombat activities of armed forces in foreign 

countries; international agreements 

(a) When the United States is a party to an international 

agreement which provides for the settlement or adjudication and 

cost sharing of claims against the United States arising out of the 

acts or omissions of a member or civilian employee of an armed 

force of the United States done in the performance of official duty, 

or arising out of any other act, omission, or occurrence for which 

an armed force of the United States is legally responsible under the 

law of another party to the international agreement, and causing 

damage in the territory of such party, the Secretary of Defense or 

the Secretary of Homeland Security or their designees may— 

(1) reimburse the party to the agreement for the agreed 

pro rata share of amounts, including any authorized arbitration costs, paid by that party in satisfying awards or judgments on claims, in accordance with the agreement; or 

(2) pay the party to the agreement the agreed pro rata 

share of any claim, including any authorized arbitration costs, 

for damage to property owned by it, in accordance with the 

agreement. 

(b) A claim arising out of an act of an enemy of the United 

States or arising, directly or indirectly, from an act of the armed 

forces, or a member thereof, while engaged in combat may not be 

considered or paid under this section. 

(c) A reimbursement or payment under this section shall be 

made by the Secretary of Defense out of appropriations as provided 

in section 2732 of this title except that payment of claims against 

the Coast Guard arising while it is operating as a service of the Department of Homeland Security shall be made out of the appropriations for the operating expenses of the Coast Guard. The appropriations referred to in this subsection may be used to buy foreign currencies required for the reimbursement or payment. 

(d) Upon the request of the Secretary of Homeland Security or 

his designee, any payments made relating to claims arising from 

the activities of the Coast Guard and covered by subsection (a) may 

be reimbursed or paid to the foreign country concerned by the authorized representative of the Department of Defense out of appropriations as provided in section 2732 of this title, subject to reimbursement from the Department of Homeland Security. 

(Added Pub. L. 87–651, title I, Sec. 113(a), Sept. 7, 1962, 76 Stat. 512; amended Pub. L. 90– 

521, Sec. 4, Sept. 26, 1968, 82 Stat. 874; Pub. L. 94–390, Sec. 1(1), Aug. 19, 1976, 90 Stat. 1191; 

Pub. L. 98–525, title XIV, Sec. 1405(42)(A), Oct. 19, 1984, 98 Stat. 2625; Pub. L. 101–510, div. 

A, title XIV, Sec. 1481(j)(4)(B), Nov. 5, 1990, 104 Stat. 1709; Pub. L. 107–296, title XVII, Sec. 

1704(b)(1), Nov. 25, 2002, 116 Stat. 2314.) 

§ 2734b. Property loss; personal injury or death: incident to 

activities of armed forces of foreign countries in 

United States; international agreements 

(a) When the United States is a party to an international 

agreement which provides for the settlement or adjudication by the 

United States under its laws and regulations, and subject to agreed 

pro rata reimbursement, of claims against another party to the 

agreement arising out of the acts or omissions of a member or civilian employee of an armed force of that party done in the perform-
§ 2735 CH. 163—MILITARY CLAIMS 1582 

ance of official duty, or arising out of any other act, omission, or 

occurrence for which that armed force is legally responsible under 

applicable United States law, and causing damage in the United 

States, or a territory, Commonwealth, or possession thereof; those 

claims may be prosecuted against the United States, or settled by 

the United States, in accordance with the agreement, as if the acts 

or omissions upon which they are based were the acts or omissions 

of a member or a civilian employee of an armed force of the United 

States. 

(b) When a dispute arises in the settlement or adjudication of 

a claim under this section whether an act or omission was in the 

performance of official duty, or whether the use of a vehicle of the 

armed forces was authorized, the dispute shall be decided under 

the international agreement with the foreign country concerned. 

Such a decision is final and conclusive. The Secretary of Defense 

may pay that part of the cost of obtaining such a decision that is 

chargeable to the United States under that agreement. 

(c) A claim arising out of an act of an enemy of the United 

States may not be considered or paid under this section. 

(d) A payment under this section shall be made by the Secretary of Defense out of appropriations as provided in section 2732 

of this title. 

(Added Pub. L. 87–651, title I, Sec. 113(a), Sept. 7, 1962, 76 Stat. 512; amended Pub. L. 94– 

390, Sec. 1(2), Aug. 19, 1976, 90 Stat. 1191; Pub. L. 101–510, div. A, title XIV, Sec. 1481(j)(4)(C), 

Nov. 5, 1990, 104 Stat. 1709.) 

§ 2735. Settlement: final and conclusive 

Notwithstanding any other provision of law, the settlement of 

a claim under section 2733, 2734, 2734a, 2734b, or 2737 of this 

title is final and conclusive. 

(Aug. 10, 1956, ch. 1041, 70A Stat. 155; Pub. L. 88–558, Sec. 5(1), Aug. 31, 1964, 78 Stat. 768; 

Pub. L. 92–413, Aug. 29, 1972, 86 Stat. 649.) 

§ 2736. Property loss; personal injury or death: advance payment 

(a)(1) In the case of a person who is injured or killed, or whose 

property is damaged or lost, under circumstances for which the 

Secretary of a military department is authorized by law to allow 

a claim, the Secretary of the military department concerned may 

make a payment to or for the person, or the legal representatives 

of the person, in advance of the submission of such a claim or, if 

such a claim is submitted, in advance of the final settlement of the 

claim. The amount of such a payment may not exceed $100,000. 

(2) Payments under this subsection are limited to payments 

which would otherwise be payable under section 2733 or 2734 of 

this title or section 715 of title 32. 

(3) The Secretary of a military department may delegate the 

authority to make payments under this subsection to the Judge Advocate General of an armed force under the jurisdiction of the Secretary. The Secretary may delegate such authority to any other officer or employee under the jurisdiction of the Secretary, but only 

with respect to the payment of amounts of $25,000 or less. 

(4) Payments under this subsection shall be made under regulations prescribed by the Secretary of the military department concerned. 
1583 § 2737 CH. 163—MILITARY CLAIMS 

(b) Any amount paid under subsection (a) shall be deducted 

from any amount that may be allowed under any other provision 

of law to the person, or his legal representative, for injury, death, 

damage, or loss attributable to the accident concerned. 

(c) So far as practicable, regulations prescribed under this section shall be uniform for the military departments. 

(d) Payment of an amount under subsection (a) is not an admission by the United States of liability for the accident concerned. 

(Added Pub. L. 87–212, Sec. 1(1), Sept. 8, 1961, 75 Stat. 488; amended Pub. L. 90–521, Sec. 

2, Sept. 26, 1968, 82 Stat. 874; Pub. L. 98–564, Sec. 3, Oct. 30, 1984, 98 Stat. 2919; Pub. L. 

100–456, div. A, title VII, Sec. 735(a), Sept. 29, 1988, 102 Stat. 2005.) 

§ 2737. Property loss; personal injury or death: incident to 

use of property of the United States and not cognizable under other law 

(a) Under such regulations as the Secretary concerned may 

prescribe, he or his designee may settle and pay, in an amount not 

more than $1,000, a claim against the United States, not cognizable under any other provision of law, for— 

(1) damage to, or loss of, property; or 

(2) personal injury or death; 

caused by a civilian official or employee of a military department 

or the Coast Guard, or a member of the armed forces, incident to 

the use of a vehicle of the United States at any place, or any other 

property of the United States on a Government installation. 

(b) Under such regulations as the Secretary of Defense may 

prescribe, he or his designee has the same authority as the Secretary of a military department with respect to a claim, not cognizable under any other provision of law, for— 

(1) damage to, or loss of, property; or 

(2) personal injury or death; 

caused by a civilian official or employee of the Department of Defense not covered by subsection (a), incident to the use of a vehicle 

of the United States at any place, or any other property of the 

United States on a Government installation. 

(c) A claim may not be allowed under subsection (a) or (b) if 

the damage to, or loss of, property, or the personal injury or death 

was caused wholly or partly by a negligent or wrongful act of the 

claimant, his agent, or his employee. 

(d) A claim for personal injury or death under this section may 

not be allowed for more than the cost of reasonable medical, hospital, and burial expenses actually incurred, and not otherwise furnished or paid by the United States. 

(e) No claim may be allowed under this section unless it is presented in writing within two years after it accrues. 

(f) A claim may not be paid under subsection (a) or (b) unless 

the amount tendered is accepted by the claimant in full satisfaction. 

(g) No claim or any part thereof, the amount of which is legally 

recoverable by the claimant under an indemnifying law or indemnity contract, may be paid under this section. No subrogated claim 

may be paid under this section. 

(h) So far as practicable, regulations prescribed under this section shall be uniform. Regulations prescribed under this section by 
§ 2738 CH. 163—MILITARY CLAIMS 1584 

the Secretaries of the military departments must be approved by 

the Secretary of Defense. 

(Added Pub. L. 87–769, Sec. 1(1)(A), Oct. 9, 1962, 76 Stat. 767, Sec. 2736; renumbered Sec. 2737, 

Pub. L. 89–718, Sec. 21(a), Nov. 2, 1966, 80 Stat. 1118.) 

§ 2738. Property loss: reimbursement of members for certain 

losses of household effects caused by hostile action 

(a) AUTHORITY TO REIMBURSE.—The Secretary concerned may 

reimburse a member of the armed forces in an amount not more 

than $100,000 for a loss described in subsection (b). 

(b) COVERED LOSSES.—This section applies with respect to a 

loss of household effects sustained during a move made incident to 

a change of permanent station when, as determined by the Secretary, the loss was caused by a hostile action incident to war or 

a warlike action by a military force. 

(c) LIMITATION.—The Secretary may provide reimbursement 

under this section for a loss described in subsection (b) only to the 

extent that the loss is not reimbursed under insurance or under the 

authority of another provision of law. 

(d) APPLICABILITY OF OTHER AUTHORITIES AND REQUIREMENTS.—Subsections (b), (d), (e), (f), and (g) of section 2733 of this 

title shall apply to a request for a reimbursement under this section as if the request were a claim against the United States. 

(Added Pub. L. 103–337, div. A, title V, Sec. 557(a), Oct. 5, 1994, 108 Stat. 2775.) 

§ 2739. Amounts recovered from third parties for loss or 

damage to personal property shipped or stored at 

Government expense: crediting to appropriations 

(a) CREDITING OF COLLECTIONS.—Any qualifying military department third-party collection shall be credited to the appropriate 

current appropriation. Amounts so credited shall be merged with 

the funds in that appropriation and shall be available for the same 

period and purposes as the funds with which merged. 

(b) APPROPRIATE CURRENT APPROPRIATION.—For purposes of 

subsection (a), the appropriate current appropriation with respect 

to a qualifying military department third-party collection is the appropriation currently available, as of the date of the collection, for 

the payment of claims by that military department for loss or damage of personal property shipped or stored at Government expense. 

(c) QUALIFYING MILITARY DEPARTMENT THIRD-PARTY COLLECTIONS.—For purposes of subsection (a), a qualifying military department third-party collection is any amount that a military department collects under sections 3711, 3716, 3717, and 3721 of title 

31 from a third party for a loss or damage to personal property 

that occurred during shipment or storage of the property at Government expense and for which the Secretary of the military department paid the owner in settlement of a claim. 

(Added Pub. L. 105–261, div. A, title X, Sec. 1010(a)(1), Oct. 17, 1998, 112 Stat. 2117.) 
1585 § 2740 CH. 163—MILITARY CLAIMS 

§ 2740. Property loss: reimbursement of members and civilian employees for full replacement value of household effects when contractor reimbursement not 

available 

The Secretary of Defense and the Secretaries of the military 

departments, in paying a claim under section 3721 of title 31 arising from loss or damage to household goods stored or transported 

at the expense of the Department of Defense, may pay the claim 

on the basis of full replacement value in any of the following cases 

in which reimbursement for the full replacement value for the loss 

or damage is not available directly from a carrier under section 

2636a of this title: 

(1) A case in which— 

(A) the lost or damaged goods were stored or transported under a contract, tender, or solicitation in accordance with section 2636a of this title that requires the 

transportation service provider to settle claims on the 

basis of full replacement value; and 

(B) the loss or damage occurred under circumstances 

that exclude the transportation service provider from liability. 

(2) A case in which— 

(A) the loss or damage occurred while the lost or damaged goods were in the possession of an ocean carrier that 

was transporting, loading, or unloading the goods under a 

Department of Defense contract for ocean carriage; and 

(B) the land-based portions of the transportation were 

under contracts, in accordance with section 2636a of this 

title, that require the land carriers to settle claims on the 

basis of full replacement value. 

(3) A case in which— 

(A) the lost or damaged goods were transported or 

stored under a contract or solicitation that requires at 

least one of the transportation service providers or carriers 

that handled the shipment to settle claims on the basis of 

full replacement value pursuant to section 2636a of this 

title; 

(B) the lost or damaged goods have been in the custody of more than one independent contractor or transportation service provider; and 

(C) a claim submitted to the delivering transportation 

service provider or carrier is denied in whole or in part because the loss or damage occurred while the lost or damaged goods were in the custody of a prior transportation 

service provider or carrier or government entity. 

(Added Pub. L. 111–383, div. A, title III, Sec. 354(a)(1), Jan. 7, 2011, 124 Stat. 4194.) 
1586 

CHAPTER 165—ACCOUNTABILITY AND RESPONSIBILITY 

Sec. 

2771. Final settlement of accounts: deceased members. 

2772. Share of fines and forfeitures to benefit Armed Forces Retirement Home. 

2773. Designation, powers, and accountability of deputy disbursing officials. 

2773a. Departmental accountable officials. 

2773b. Parking of funds: prohibition; penalties. 

2774. Claims for overpayment of pay and allowances and of travel and transportation allowances. 

2775. Liability of members assigned to military housing. 

2776. Use of receipts of public money for current expenditures. 

2777. Requisitions for advances and removal of charges outstanding in accounts 

of advances. 

[2778. Repealed.] 

2779. Use of funds because of fluctuations in currency exchange rates of foreign 

countries. 

2780. Debt collection. 

2781. Availability of appropriations: exchange fees; losses in accounts. 

2782. Damage to real property: disposition of amounts recovered. 

2783. Nonappropriated fund instrumentalities: financial management and use of 

nonappropriated funds. 

2784. Management of purchase cards. 

2784a. Management of travel cards. 

2785. Remittance addresses: regulation of alterations. 

2786. Department of Defense payments by electronic transfers of funds: exercise 

of authority for waivers. 

2787. Reports of survey. 

2788. Property accountability: regulations. 

2789. Individual equipment: unauthorized disposition. 

2790. Recovery of improperly disposed of Department of Defense property. 

§ 2771. Final settlement of accounts: deceased members 

(a) In the settlement of the accounts of a deceased member of 

the armed forces, an amount due from the armed force of which he 

was a member shall be paid to the person highest on the following 

list living on the date of death: 

(1) Beneficiary designated by him in writing to receive 

such an amount, if the designation is received, before the deceased member’s death, at the place named in regulations to 

be prescribed by the Secretary concerned. 

(2) Surviving spouse. 

(3) Children and their descendants, by representation. 

(4) Father and mother in equal parts or, if either is dead, 

the survivor. 

(5) Legal representative. 

(6) Person entitled under the law of the domicile of the deceased member. 

(b) Designations and changes of designation of beneficiaries 

under subsection (a)(1) are subject to regulations to be prescribed 

by the Secretary concerned. So far as practicable, these regulations 

shall be uniform for the uniformed services. 

(c) Payments under subsection (a) shall be made by the Secretary of Defense. 
1587 § 2773 CH. 165—ACCOUNTABILITY AND RESPONSIBILITY 

(d) A payment under this section bars recovery by any other 

person of the amount paid. 

(Aug. 10, 1956, ch. 1041, 70A Stat. 155; Pub. L. 85–861, Sec. 1(56), Sept. 2, 1958, 72 Stat. 1461; 

Pub. L. 86–641, July 12, 1960, 74 Stat. 473; Pub. L. 89–718, Sec. 8(a), Nov. 2, 1966, 80 Stat. 

1117; Pub. L. 96–513, title V, Sec. 511(97), Dec. 12, 1980, 94 Stat. 2928; Pub. L. 103–160, div. 

A, title XI, Sec. 1182(a)(11), Nov. 30, 1993, 107 Stat. 1771; Pub. L. 104–316, title II, Sec. 202(f), 

Oct. 19, 1996, 110 Stat. 3842.) 

§ 2772. Share of fines and forfeitures to benefit Armed 

Forces Retirement Home 

(a) DEPOSIT REQUIRED.—The Secretary of the military department concerned or, in the case of the Coast Guard, the Commandant shall deposit in the Armed Forces Retirement Home 

Trust Fund a percentage (determined under subsection (b)) of the 

following amounts: 

(1) The amount of forfeitures and fines adjudged against 

an enlisted member, warrant officer, or limited duty officer of 

the armed forces by sentence of a court martial or under authority of section 815 of this title (article 15) over and above 

any amount that may be due from the member, warrant officer, or limited duty officer for the reimbursement of the United 

States or any individual. 

(2) The amount of forfeitures on account of the desertion 

of an enlisted member, warrant officer, or limited duty officer 

of the armed forces. 

(b) DETERMINATION OF PERCENTAGE.—The Armed Forces Retirement Home Board shall determine, on the basis of the financial 

needs of the Armed Forces Retirement Home, the percentage of the 

amounts referred to in subsection (a) to be deposited in the trust 

fund referred to in such subsection. 

(Added Pub. L. 101–189, div. A, title III, Sec. 342(a)(1), Nov. 29, 1989, 103 Stat. 1419; amended 

Pub. L. 101–510, div. A, title XV, Sec. 1533(a)(3), (4)(A), Nov. 5, 1990, 104 Stat. 1733; Pub. L. 

111–281, title II, Sec. 205(b)(1), Oct. 15, 2010, 124 Stat. 2911.) 

§ 2773. Designation, powers, and accountability of deputy 

disbursing officials 

(a)(1) Subject to paragraph (3), a disbursing official of the Department of Defense may designate a deputy disbursing official— 

(A) to make payments as the agent of the disbursing official; 

(B) to sign checks drawn on disbursing accounts of the Secretary of the Treasury; and 

(C) to carry out other duties required under law. 

(2) The penalties for misconduct that apply to a disbursing official apply to a deputy disbursing official designated under this subsection. 

(3) A disbursing official may make a designation under paragraph (1) only with the approval of the Secretary of Defense or, in 

the case of a disbursing official of a military department, the Secretary of that military department. 

(b)(1) If a disbursing official of the Department of Defense dies, 

becomes disabled, or is separated from office, a deputy disbursing 

official may continue the accounts and payments in the name of the 

former disbursing official until the last day of the 2d month after 

the month in which the death, disability, or separation occurs. The 
§ 2773a CH. 165—ACCOUNTABILITY AND RESPONSIBILITY 1588 

accounts and payments shall be allowed, audited, and settled as 

provided by law. The Secretary of the Treasury shall honor checks 

signed in the name of the former disbursing official in the same 

way as if the former disbursing official had continued in office. 

(2) The deputy disbursing official, and not the former disbursing official or the estate of the former disbursing official, is liable for the actions of the deputy disbursing official under this subsection. 

(Added Pub. L. 87–480, Sec. 1(1)(A), June 8, 1962, 76 Stat. 94; amended Pub. L. 97–258, Sec. 

2(b)(7)(B), Sept. 13, 1982, 96 Stat. 1054; Pub. L. 104–106, div. A, title IX, Sec. 913(a)(2), Feb. 

10, 1996, 110 Stat. 410.) 

§ 2773a. Departmental accountable officials 

(a) DESIGNATION BY SECRETARY OF DEFENSE.—The Secretary of 

Defense may designate any civilian employee of the Department of 

Defense or member of the armed forces under the Secretary’s jurisdiction who is described in subsection (b) as an employee or member who, in addition to any other potential accountability, may be 

held accountable through personal monetary liability for an illegal, 

improper, or incorrect payment made by the Department of Defense described in subsection (c). Any such designation shall be in 

writing. Any employee or member who is so designated may be referred to as a ‘‘departmental accountable official’’. 

(b) COVERED EMPLOYEES AND MEMBERS.—An employee or 

member of the armed forces described in this subsection is an employee or member who— 

(1) is responsible in the performance of the employee’s or 

member’s duties for providing to a certifying official of the Department of Defense information, data, or services that are directly relied upon by the certifying official in the certification 

of vouchers for payment; and 

(2) is not otherwise accountable under subtitle III of title 

31 or any other provision of law for payments made on the 

basis of such vouchers. 

(c) PECUNIARY LIABILITY.—(1) The Secretary of Defense may 

subject a departmental accountable official to pecuniary liability for 

an illegal, improper, or incorrect payment made by the Department 

of Defense if the Secretary determines that such payment— 

(A) resulted from information, data, or services that that 

official provided to a certifying official and upon which that 

certifying official directly relies in certifying the voucher supporting that payment; and 

(B) was the result of fault or negligence on the part of that 

departmental accountable official. 

(2) Pecuniary liability under this subsection shall apply in the 

same manner and to the same extent as applies to an official accountable under subtitle III of title 31. 

(3) Any pecuniary liability of a departmental accountable official under this subsection for a loss to the United States resulting 

from an illegal, improper, or incorrect payment is joint and several 

with that of any other officer or employee of the United States or 

member of the uniformed services who is pecuniarily liable for such 

loss. 
1589 § 2774 CH. 165—ACCOUNTABILITY AND RESPONSIBILITY 

(d) CERTIFYING OFFICIAL DEFINED.—In this section, the term 

‘‘certifying official’’ means an employee who has the responsibilities 

specified in section 3528(a) of title 31. 

(Added Pub. L. 107–314, div. A, title X, Sec. 1005(a), Dec. 2, 2002, 116 Stat. 2631; amended 

Pub. L. 109–163, div. A, title X, Sec. 1056(c)(8), Jan. 6, 2006, 119 Stat. 3440.) 

§ 2773b. Parking of funds: prohibition; penalties 

(a) PROHIBITION.—An officer or employee of the Department of 

Defense may not direct the designation of funds for a particular 

purpose in the budget of the President, as submitted to Congress 

pursuant to section 1105 of title 31, or the supporting documents 

of the Department of Defense component of such budget, with the 

knowledge or intent that such funds, if made available to the Department, will not be used for the purpose for which they are designated. 

(b) PENALTIES.—The direction of the designation of funds in 

violation of the prohibition in subsection (a) shall be treated for 

purposes of chapter 13 of title 31 as a violation of section 

1341(a)(1)(A) of such title. 

(Added Pub. L. 109–364, div. A, title X, Sec. 1053(a)(1), Oct. 17, 2006, 120 Stat. 2396.) 

§ 2774. Claims for overpayment of pay and allowances and 

of travel and transportation allowances 

(a) A claim of the United States against a person arising out 

of an erroneous payment of any pay or allowances made before, on, 

or after October 2, 1972, or arising out of an erroneous payment 

of travel and transportation allowances, to or on behalf of a member or former member of the uniformed services, the collection of 

which would be against equity and good conscience and not in the 

best interest of the United States, may be waived in whole or in 

part by— 

(1) the Director of the Office of Management and Budget; 

or 

(2) the Secretary concerned, as defined in section 101(5) of 

title 37, when— 

(A) the claim is in an amount aggregating not more 

than $10,000; and 

(B) the waiver is made in accordance with standards 

which the Director of the Office of Management and Budget shall prescribe. 

(b) The Director of the Office of Management and Budget or 

the Secretary concerned, as the case may be, may not exercise his 

authority under this section to waive any claim— 

(1) if, in his opinion, there exists, in connection with the 

claim, an indication of fraud, misrepresentation, fault, or lack 

of good faith on the part of the member or any other person 

having an interest in obtaining a waiver of the claim; or 

(2) if application for waiver is received in his office after 

the expiration of five years immediately following the date on 

which the erroneous payment was discovered. 

(c) A person who has repaid to the United States all or part 

of the amount of a claim, with respect to which a waiver is granted 

under this section, is entitled, to the extent of the waiver, to refund, by the department concerned at the time of the erroneous 
§ 2775 CH. 165—ACCOUNTABILITY AND RESPONSIBILITY 1590 

payment, of the amount repaid to the United States, if he applies 

to that department for that refund within two years following the 

effective date of the waiver. The Secretary concerned shall pay 

from current applicable appropriations that refund in accordance 

with this section. 

(d) In the audit and settlement of accounts of any accountable 

officer or official, full credit shall be given for any amounts with respect to which collection by the United States is waived under this 

section. 

(e) An erroneous payment, the collection of which is waived 

under this section, is considered a valid payment for all purposes. 

(f) This section does not affect any authority under any other 

law to litigate, settle, compromise, or waive any claim of the United 

States. 

(Added Pub. L. 92–453, Sec. 1(1), Oct. 2, 1972, 86 Stat. 758; amended Pub. L. 96–513, title V, 

Sec. 511(98), Dec. 12, 1980, 94 Stat. 2928; Pub. L. 99–224, Sec. 2(a), Dec. 28, 1985, 99 Stat. 

1741; Pub. L. 100–26, Sec. 7(j)(7)(A), (B), Apr. 21, 1987, 101 Stat. 283; Pub. L. 102–190, div. 

A, title VI, Sec. 657(b), Dec. 5, 1991, 105 Stat. 1393; Pub. L. 104–316, title I, Sec. 105(b), Oct. 

19, 1996, 110 Stat. 3830; Pub. L. 109–364, div. A, title VI, Sec. 671(a), Oct. 17, 2006, 120 Stat. 

2270.) 

§ 2775. Liability of members assigned to military housing 

(a)(1) A member of the armed forces shall be liable to the 

United States for damage to any family housing unit or unaccompanied personnel housing unit, or damage to or loss of any equipment or furnishings of any family housing unit or unaccompanied 

personnel housing unit, assigned to or provided such member if (as 

determined under regulations prescribed by the Secretary of Defense or the Secretary of Homeland Security with respect to the 

Coast Guard when it is not operating as a service in the Navy) the 

damage or loss was caused by the abuse or negligence of the member (or a dependent of the member) or of a guest of the member 

(or a dependent of the member). 

(2) A member of the armed forces— 

(A) who is assigned or provided a family housing unit; and 

(B) who fails to clean satisfactorily that housing unit (as 

determined under regulations prescribed by the Secretary of 

Defense or the Secretary of Homeland Security with respect to 

the Coast Guard when it is not operating as a service in the 

Navy) upon termination of the assignment or provision of that 

housing unit, 

shall be liable to the United States for the cost of cleaning made 

necessary as a result of that failure. 

(b) The Secretary of Defense, and the Secretary of Homeland 

Security with respect to the Coast Guard when it is not operating 

as a service in the Navy, may establish limitations on liability 

under this section, including (in the case of liability under subsection (a)(1)) different limitations based upon the degree of abuse 

or negligence involved, and may compromise or waive a claim of 

the United States under this section. 

(c)(1) The Secretary concerned may deduct from a member’s 

pay an amount sufficient to pay for the cost of any repair or replacement made necessary as the result of any abuse or negligence 

referred to in subsection (a)(1), or the cost of any cleaning made 

necessary by a failure to clean satisfactorily a family housing unit 
1591 § 2777 CH. 165—ACCOUNTABILITY AND RESPONSIBILITY 

referred to in subsection (a)(2), for which the member is liable. Regulations implementing this section may also provide for the collection of amounts owed under this section by any other authorized 

means. 

(2) The final determination of an amount to be deducted from 

the pay of an officer of an armed force in accordance with regulations prescribed under this section shall be deemed to be a special 

order authorizing such deduction for the purposes of section 1007 

of title 37. 

(d) Amounts received under this section shall be credited to the 

family housing operations and maintenance account, in the case of 

damage to a family housing unit (or the equipment or furnishings 

of a family housing unit) or failure to clean satisfactorily a family 

housing unit, or to the operations and maintenance account, in the 

case of damage to an unaccompanied personnel housing unit (or 

the equipment or furnishings of an unaccompanied personnel housing unit), of the military department or defense agency concerned, 

or the operating expenses account of the Coast Guard, as appropriate. Amounts so credited shall be available for use for the same 

purposes and under the same circumstances as other funds in 

those accounts. 

(e) The Secretary of Defense, and the Secretary of Homeland 

Security with respect to the Coast Guard when it is not operating 

as a service in the Navy, shall prescribe regulations to carry out 

this section. Such regulations shall include— 

(1) regulations for determining the cost of repairs and replacements made necessary as the result of abuse or negligence for which a member is liable under subsection (a)(1); 

(2) regulations for determining the cost of cleaning made 

necessary as a result of the failure to clean satisfactorily for 

which a member is liable under subsection (a)(2); and 

(3) provisions for limitations of liability, the compromise or 

waiver of claims, and the collection of amounts owed under 

this section. 

(Added Pub. L. 96–418, title V, Sec. 506(a), Oct. 10, 1980, 94 Stat. 1765; amended Pub. L. 97– 

214, Sec. 10(a)(6), July 12, 1982, 96 Stat. 175; Pub. L. 98–407, title VIII, Sec. 801(a)(1), Aug. 

28, 1984, 98 Stat. 1517; Pub. L. 99–167, title VIII, Sec. 802(a)–(d)(1), Dec. 3, 1985, 99 Stat. 986; 

Pub. L. 99–661, div. A, title XIII, Sec. 1343(a)(19), Nov. 14, 1986, 100 Stat. 3993; Pub. L. 107– 

296, title XVII, Sec. 1704(b)(1), Nov. 25, 2002, 116 Stat. 2314.) 

§ 2776. Use of receipts of public money for current expenditures 

Without deposit to the credit of the Secretary of the Treasury 

and without withdrawal on money requisitions, a disbursing official 

of the Department of Defense may use receipts of public money 

charged in the disbursing official’s accounts (except receipts to be 

credited to river, harbor, and flood control appropriations) for current expenditures, with necessary bookkeeping adjustments being 

made. 

(Added Pub. L. 97–258, Sec. 2(b)(8)(B), Sept. 13, 1982, 96 Stat. 1055.) 

§ 2777. Requisitions for advances and removal of charges 

outstanding in accounts of advances 

(a) The Secretary of a military department may issue to a disbursing official or agent of the department a requisition for an ad-
[§ 2778 CH. 165—ACCOUNTABILITY AND RESPONSIBILITY 1592 

vance of not more than the total appropriation for the department. 

The amount advanced shall be— 

(1) under an ‘‘account of advances’’ for the department; 

(2) on a proper voucher; 

(3) only for obligations payable under specific appropriations; 

(4) charged to, and within the limits of, each specific appropriation; and 

(5) returned to the account of advances. 

(b) A charge outstanding in an account of advances of a military department shall be removed by crediting the account of advances of the department and deducting the amount of the charge 

from an appropriation made available for advances to the department when— 

(1) relief has been granted or may be granted later to a 

disbursing official or agent of the department operating under 

an account of advances and under a law having no provision 

for removing charges outstanding in an account of advances; or 

(2) the charge has been— 

(A) outstanding in the account of advances of the department for 2 complete fiscal years; and 

(B) certified by the head of the department as uncollectable. 

(c) Subsection (b) does not affect the financial liability of a disbursing official or agent. 

(Added Pub. L. 97–258, Sec. 2(b)(8)(B), Sept. 13, 1982, 96 Stat. 1055; amended Pub. L. 98–525, 

title XIV, Sec. 1405(43), Oct. 19, 1984, 98 Stat. 2625; Pub. L. 104–316, title I, Sec. 105(c), Oct. 

19, 1996, 110 Stat. 3830.) 

[§ 2778. Repealed. Pub. L. 104–316, title I, Sec. 105(d), Oct. 19, 

1996, 110 Stat. 3830] 

§ 2779. Use of funds because of fluctuations in currency exchange rates of foreign countries 

(a) TRANSFERS BACK TO FOREIGN CURRENCY FLUCTUATIONS APPROPRIATION.—(1) Funds transferred from the appropriation ‘‘Foreign Currency Fluctuations, Defense’’ may be transferred back to 

the appropriation— 

(A) when the funds are not needed to pay obligations incurred because of fluctuations in currency exchange rates of 

foreign countries in the appropriation to which the funds were 

originally transferred; and 

(B) because of subsequent favorable fluctuations in the 

rates or because other funds are, or become, available to pay 

the obligations. 

(2) A transfer back to the Foreign Currency Fluctuations, Defense appropriation may not be made after the end of the second 

fiscal year after the fiscal year that the appropriation to which the 

funds were originally transferred is available for obligation. 

(b) FUNDING FOR LOSSES IN MILITARY CONSTRUCTION AND FAMILY HOUSING.—(1) One hundred million dollars, plus $25,000,000 

from Family Housing, Defense, are appropriated to the Secretary 

of Defense, to remain available until spent. The appropriation is 

available only to provide funds to eliminate losses in military construction or expenses of family housing for the Department of De-
1593 § 2780 CH. 165—ACCOUNTABILITY AND RESPONSIBILITY 

fense caused by fluctuations in currency exchange rates of foreign 

countries that changed after a budget request was submitted to 

Congress. 

(2) Funds provided under this subsection are merged with and 

are available for the same purpose and for the same time period 

as the appropriation to which they are applied. An authorization or 

limitation limiting the amount that may be obligated or spent is increased to the extent necessary to reflect fluctuations in exchange 

rates from those used in preparing the budget submission. 

(3) An obligation payable in the currency of a foreign country 

may be recorded as an obligation based on exchange rates used in 

preparing a budget submission. A change reflecting fluctuations in 

the exchange rate may be recorded as a disbursement is made. 

(c) TRANSFERS TO MILITARY PERSONNEL ACCOUNTS.—The Secretary of Defense may transfer funds to military personnel appropriations for a fiscal year out of funds available to the Department 

of Defense for that fiscal year under the appropriation ‘‘Foreign 

Currency Fluctuations, Defense’’. 

(d) TRANSFERS TO FOREIGN CURRENCY FLUCTUATIONS ACCOUNT.—(1) The Secretary of Defense may transfer to the appropriation ‘‘Foreign Currency Fluctuations, Defense’’ unobligated 

amounts of funds appropriated for operation and maintenance and 

unobligated amounts of funds appropriated for military personnel. 

(2) Any transfer from an appropriation under paragraph (1) 

shall be made not later than the end of the second fiscal year following the fiscal year for which the appropriation is provided. 

(3) Any transfer made pursuant to the authority provided in 

this subsection shall be limited so that the amount in the appropriation ‘‘Foreign Currency Fluctuations, Defense’’ does not exceed 

$970,000,000 at the time the transfer is made. 

(e) CONDITIONS OF AVAILABILITY FOR TRANSFERRED FUNDS.— 

Amounts transferred under subsection (c) or (d) shall be merged 

with and be available for the same purposes and for the same period as the appropriations to which transferred. 

(Added Pub. L. 97–258, Sec. 2(b)(8)(B), Sept. 13, 1982, 96 Stat. 1056; amended Pub. L. 101– 

510, div. A, title XIII, Sec. 1301(15), Nov. 5, 1990, 104 Stat. 1668; Pub. L. 104–106, div. A, title 

IX, Sec. 911(a)–(c), (e), Feb. 10, 1996, 110 Stat. 406, 407.) 

§ 2780. Debt collection 

(a)(1) Subject to paragraph (2), the Secretary of Defense shall 

enter into one or more contracts with a person for collection services to recover indebtedness owed to the United States (arising out 

of activities related to Department of Defense) that is delinquent 

by more than three months. 

(2) The authority of the Secretary to enter into a contract 

under this section for any fiscal year is subject to the availability 

of appropriations. 

(3) Any such contract shall provide that the person submit to 

the Secretary a status report on the person’s success in collecting 

such debts at least once each six months. Section 3718 of title 31 

shall apply to any such contract, to the extent not inconsistent with 

this subsection. 

(b)(1) Except as provided in paragraph (2), the Secretary of Defense shall disclose to consumer reporting agencies, in accordance 
§ 2781 CH. 165—ACCOUNTABILITY AND RESPONSIBILITY 1594 

with paragraph (1) of section 3711(e) of title 31, information concerning any debt described in subsection (a) of more than $100 that 

is delinquent by more than 31 days. 

(2) No disclosure shall be made under paragraph (1) with respect to an indebtedness while a decision regarding waiver of collection of the indebtedness is pending under section 2774 of this 

title or section 716 of title 32, or while a decision regarding remission or cancellation of the indebtedness is pending under section 

4837, 6161, or 9837 of this title, unless the Secretary concerned (as 

defined in section 101(5) of title 37) determines that disclosure 

under that paragraph pending such decision is in the best interests 

of the United States. 

(Added Pub. L. 99–661, div. A, title XIII, Sec. 1309(a), Nov. 14, 1986, 100 Stat. 3982; amended 

Pub. L. 104–316, title I, Sec. 115(g)(2)(C), Oct. 19, 1996, 110 Stat. 3835; Pub. L. 109–364, div. 

A, title VI, Sec. 672(a), Oct. 17, 2006, 120 Stat. 2270.) 

§ 2781. Availability of appropriations: exchange fees; losses 

in accounts 

Amounts appropriated to the Department of Defense may be 

used for— 

(1) exchange fees; and 

(2) losses in the accounts of disbursing officials and agents 

in accordance with law. 

(Added Pub. L. 100–370, Sec. 1(m)(1), July 19, 1988, 102 Stat. 849.) 

§ 2782. Damage to real property: disposition of amounts recovered 

Except as provided in section 2775 of this title, amounts recovered for damage caused to real property under the jurisdiction of 

the Secretary of a military department or, with respect to the Defense Agencies, under the jurisdiction of the Secretary of Defense 

shall be credited to the account available for the repair or replacement of the real property at the time of recovery. In such amounts 

as are provided in advance in appropriation Acts, amounts so credited shall be available for use for the same purposes and under the 

same circumstances as other funds in the account. 

(Added Pub. L. 104–106, div. B, title XXVIII, Sec. 2821(a), Feb. 10, 1996, 110 Stat. 556.) 

§ 2783. Nonappropriated fund instrumentalities: financial 

management and use of nonappropriated funds 

(a) REGULATION OF MANAGEMENT AND USE OF NONAPPROPRIATED FUNDS.—The Secretary of Defense shall prescribe 

regulations governing— 

(1) the purposes for which nonappropriated funds of a nonappropriated fund instrumentality of the United States within 

the Department of Defense may be expended; and 

(2) the financial management of such funds to prevent 

waste, loss, or unauthorized use. 

(b) PENALTIES FOR VIOLATIONS.—(1) A civilian employee of the 

Department of Defense who is paid from nonappropriated funds 

and who commits a substantial violation of the regulations prescribed under subsection (a) shall be subject to the same penalties 

as are provided by law for misuse of appropriations by a civilian 

employee of the Department of Defense paid from appropriated 
1595 § 2784 CH. 165—ACCOUNTABILITY AND RESPONSIBILITY 

funds. The Secretary of Defense shall prescribe regulations to carry 

out this paragraph. 

(2) The Secretary shall provide in regulations that a violation 

of the regulations prescribed under subsection (a) by a person subject to chapter 47 of this title (the Uniform Code of Military Justice) is punishable as a violation of section 892 of this title (article 

92 of the Uniform Code of Military Justice). 

(c) NOTIFICATION OF VIOLATIONS.—(1) A civilian employee of 

the Department of Defense (whether paid from nonappropriated 

funds or from appropriated funds), and a member of the armed 

forces, whose duties include the obligation of nonappropriated 

funds, shall notify the Secretary of Defense of information which 

the person reasonably believes evidences— 

(A) a violation by another person of any law, rule, or regulation regarding the management of such funds; or 

(B) other mismanagement or gross waste of such funds. 

(2) The Secretary of Defense shall designate civilian employees 

of the Department of Defense or members of the armed forces to 

receive a notification described in paragraph (1) and ensure the 

prompt investigation of the validity of information provided in the 

notification. 

(3) The Secretary shall prescribe regulations to protect the confidentiality of a person making a notification under paragraph (1). 

(Added Pub. L. 102–484, div. A, title III, Sec. 362(a), Oct. 23, 1992, 106 Stat. 2379, Sec. 2490a; 

renumbered Sec. 2783 and amended Pub. L. 103–160, div. A, title XI, Sec. 1182(a)(8)(A), Nov. 

30, 1993, 107 Stat. 1771.) 

§ 2784. Management of purchase cards 

(a) MANAGEMENT OF PURCHASE CARDS.—The Secretary of Defense shall prescribe regulations governing the use and control of 

all purchase cards and convenience checks that are issued to Department of Defense personnel for official use. Those regulations 

shall be consistent with regulations that apply Government-wide 

regarding use of purchase cards by Government personnel for official purposes. 

(b) REQUIRED SAFEGUARDS AND INTERNAL CONTROLS.—Regulations under subsection (a) shall include safeguards and internal 

controls to ensure the following: 

(1) That there is a record in the Department of Defense of 

each holder of a purchase card issued by the Department of 

Defense for official use, annotated with the limitations on 

amounts that are applicable to the use of each such card by 

that purchase card holder. 

(2) That the holder of a purchase card and each official 

with authority to authorize expenditures charged to the purchase card are responsible for— 

(A) reconciling the charges appearing on each statement of account for that purchase card with receipts and 

other supporting documentation; and 

(B) forwarding that statement after being so reconciled 

to the designated disbursing office in a timely manner. 

(3) That any disputed purchase card charge, and any discrepancy between a receipt and other supporting documentation and the purchase card statement of account, is resolved in 
§ 2784 CH. 165—ACCOUNTABILITY AND RESPONSIBILITY 1596 

the manner prescribed in the applicable Government-wide purchase card contract entered into by the Administrator of General Services. 

(4) That payments on purchase card accounts are made 

promptly within prescribed deadlines to avoid interest penalties. 

(5) That rebates and refunds based on prompt payment on 

purchase card accounts are properly recorded. 

(6) That records of each purchase card transaction (including records on associated contracts, reports, accounts, and invoices) are retained in accordance with standard Government 

policies on the disposition of records. 

(7) That periodic reviews are performed to determine 

whether each purchase card holder has a need for the purchase 

card. 

(8) That the Inspector General of the Department of Defense, the Inspector General of the Army, the Naval Inspector 

General, and the Inspector General of the Air Force perform 

periodic audits to identify— 

(A) potentially fraudulent, improper, and abusive uses 

of purchase cards; 

(B) any patterns of improper card holder transactions, 

such as purchases of prohibited items; and 

(C) categories of purchases that should be made by 

means other than purchase cards in order to better aggregate purchases and obtain lower prices. 

(9) That appropriate training is provided to each purchase 

card holder and each official with responsibility for overseeing 

the use of purchase cards issued by the Department of Defense. 

(10) That the Department of Defense has specific policies 

regarding the number of purchase cards issued by various organizations and categories of organizations, the credit limits 

authorized for various categories of card holders, and categories of employees eligible to be issued purchase cards, and 

that those policies are designed to minimize the financial risk 

to the Federal Government of the issuance of the purchase 

cards and to ensure the integrity of purchase card holders. 

(c) PENALTIES FOR VIOLATIONS.—The regulations prescribed 

under subsection (a) shall— 

(1) provide— 

(A) for the reimbursement of charges for unauthorized 

or erroneous purchases, in appropriate cases; and 

(B) for appropriate adverse personnel actions or other 

punishment to be imposed in cases in which employees of 

the Department of Defense violate such regulations or are 

negligent or engage in misuse, abuse, or fraud with respect 

to a purchase card, including removal in appropriate cases; 

and 

(2) provide that a violation of such regulations by a person 

subject to chapter 47 of this title (the Uniform Code of Military 

Justice) is punishable as a violation of section 892 of this title 

(article 92 of the Uniform Code of Military Justice). 
1597 § 2784a CH. 165—ACCOUNTABILITY AND RESPONSIBILITY 

(Added Pub. L. 106–65, div. A, title IX, Sec. 933(a)(1), Oct. 5, 1999, 113 Stat. 728; amended Pub. 

L. 107–314, div. A, title X, Sec. 1007(a), (b)(1), Dec. 2, 2002, 116 Stat. 2633, 2634; Pub. L. 110– 

417, [div. A], title X, Sec. 1003(a), Oct. 14, 2008, 122 Stat. 4582.) 

§ 2784a. Management of travel cards 

(a) DISBURSEMENT OF TRAVEL ALLOWANCES DIRECTLY TO

CREDITORS.—(1) The Secretary of Defense shall require that any 

part of a travel or transportation allowance of an employee of the 

Department of Defense or a member of the armed forces be disbursed directly to the issuer of a Defense travel card if the amount 

is disbursed to the issuer in payment of amounts of expenses of official travel that are charged by the employee or member on the 

Defense travel card. 

(2) The Secretary of Defense may waive the requirement for a 

direct payment to a travel card issuer under paragraph (1) in any 

case the Secretary determines appropriate. 

(3) For the purposes of this subsection, the travel and transportation allowances referred to in paragraph (1) are amounts to 

which an employee of the Department of Defense is entitled under 

section 5702 of title 5 or a member of the armed forces is entitled 

under section 404 of title 37. 

(b) OFFSETS FOR DELINQUENT TRAVEL CARD CHARGES.—(1) The 

Secretary of Defense may require that there be deducted and withheld from any basic pay payable to an employee of the Department 

of Defense or a member of the armed forces any amount that is 

owed by the employee or member to a creditor by reason of one or 

more charges of expenses of official travel of the employee or member on a Defense travel card issued by the creditor if the employee 

or member— 

(A) is delinquent in the payment of such amount under the 

terms of the contract under which the card is issued; and 

(B) does not dispute the amount of the delinquency. 

(2) The amount deducted and withheld from pay under paragraph (1) with respect to a debt owed a creditor as described in 

that paragraph shall be disbursed to the creditor to reduce the 

amount of the debt. 

(3) The amount of pay deducted and withheld from the pay 

owed to an employee or member with respect to a pay period under 

paragraph (1) may not exceed 15 percent of the disposable pay of 

the employee or member for that pay period, except that a higher 

amount may be deducted and withheld with the written consent of 

the employee or member. 

(4) The Secretary of Defense shall prescribe procedures for deducting and withholding amounts from pay under this subsection. 

The procedures shall be substantially equivalent to the procedures 

under section 3716 of title 31. 

(c) OFFSETS OF RETIRED PAY.—In the case of a former employee of the Department of Defense or a retired member of the 

armed forces who is receiving retired pay and who owes an amount 

to a creditor by reason of one or more charges on a Defense travel 

card that were made before the retirement of the employee or 

member, the Secretary may require amounts to be deducted and 

withheld from any retired pay of the former employee or retired 

member in the same manner and subject to the same conditions as 
§ 2784a CH. 165—ACCOUNTABILITY AND RESPONSIBILITY 1598 

the Secretary deducts and withholds amounts from basic pay payable to an employee or member under subsection (b). 

(d) DETERMINATIONS OF CREDITWORTHINESS FOR ISSUANCE OF

DEFENSE TRAVEL CARD.—(1) The Secretary of Defense shall evaluate the creditworthiness of an employee of the Department of Defense or a member of armed forces before issuing a Defense travel 

card to such an employee or member. The evaluation may include 

an examination of the individual’s credit history in available credit 

records. 

(2) An individual may not be issued a Defense travel card if 

the individual is found not creditworthy as a result of the evaluation required under paragraph (1). 

(e) REGULATIONS ON DISCIPLINARY ACTION.—(1) The Secretary 

of Defense shall prescribe regulations for making determinations 

regarding the taking of disciplinary action, including assessment of 

penalties, against Department of Defense personnel for improper, 

fraudulent, or abusive use of Defense travel cards by such personnel. 

(2) The regulations prescribed under paragraph (1) shall— 

(A) provide for appropriate adverse personnel actions or 

other punishment to be imposed in cases in which employees 

of the Department of Defense violate such regulations or are 

negligent or engage in misuse, abuse, or fraud with respect to 

a Defense travel card, including removal in appropriate cases; 

and 

(B) provide that a violation of such regulations by a person 

subject to chapter 47 of this title (the Uniform Code of Military 

Justice) is punishable as a violation of section 892 of this title 

(article 92 of the Uniform Code of Military Justice). 

(f) DEFINITIONS.—In this section: 

(1) The term ‘‘Defense travel card’’ means a charge or credit card that— 

(A) is issued to an employee of the Department of Defense or a member of the armed forces under a contract 

entered into by the Department of Defense with the issuer 

of the card; and 

(B) is to be used for charging expenses incurred by the 

employee or member in connection with official travel. 

(2) The term ‘‘disposable pay’’, with respect to a pay period, 

means the amount equal to the excess of the amount of basic 

pay or retired pay, as the case may be, payable for the pay period over the total of the amounts deducted and withheld from 

such pay. 

(3) The term ‘‘retired pay’’ means— 

(A) in the case of a former employee of the Department of Defense, any retirement benefit payable to that individual, out of the Civil Service Retirement and Disability 

Fund, based (in whole or in part) on service performed by 

such individual as a civilian employee of the Department 

of Defense; and 

(B) in the case of a retired member of the armed forces 

or member of the Fleet Reserve or Fleet Marine Corps 

Reserve, retired or retainer pay to which the member is 

entitled. 
1599 § 2787 CH. 165—ACCOUNTABILITY AND RESPONSIBILITY 

(g) EXCLUSION OF COAST GUARD.—This section does not apply 

to the Coast Guard. 

(Added Pub. L. 107–314, div. A, title X, Sec. 1008(a), Dec. 2, 2002, 116 Stat. 2634; amended 

Pub. L. 108–136, div. A, title X, Sec. 1009(a)–(c)(1), Nov. 24, 2003, 117 Stat. 1587, 1588; Pub. 

L. 109–364, div. A, title X, Sec. 1071(a)(25), Oct. 17, 2006, 120 Stat. 2399.) 

§ 2785. Remittance addresses: regulation of alterations 

The Secretary of Defense, acting through the Under Secretary 

of Defense (Comptroller), shall prescribe regulations setting forth 

controls on alteration of remittance addresses. Those regulations 

shall ensure that— 

(1) a remittance address for a disbursement that is provided by an officer or employee of the Department of Defense 

authorizing or requesting the disbursement is not altered by 

any officer or employee of the department authorized to prepare the disbursement; and 

(2) a remittance address for a disbursement is altered only 

if the alteration— 

(A) is requested by the person to whom the disbursement is authorized to be remitted; and 

(B) is made by an officer or employee authorized to do 

so who is not an officer or employee referred to in paragraph (1). 

(Added Pub. L. 106–65, div. A, title IX, Sec. 933(a)(1), Oct. 5, 1999, 113 Stat. 729.) 

§ 2786. Department of Defense payments by electronic transfers of funds: exercise of authority for waivers 

With respect to any Federal payment of funds covered by section 3332(f) of title 31 (relating to electronic funds transfers) for 

which payment is made or authorized by the Department of Defense, the waiver authority provided in paragraph (2)(A)(i) of that 

section shall be exercised by the Secretary of Defense. The Secretary of Defense shall carry out the authority provided under the 

preceding sentence in consultation with the Secretary of the Treasury. 

(Added Pub. L. 106–65, div. A, title X, Sec. 1008(a)(1), Oct. 5, 1999, 113 Stat. 737.) 

§ 2787. Reports of survey 

(a) ACTION ON REPORTS OF SURVEY.—Under regulations prescribed pursuant to subsection (c), any officer of the Army, Navy, 

Air Force, or Marine Corps or any civilian employee of the Department of Defense designated in accordance with those regulations 

may act upon reports of surveys and vouchers pertaining to the 

loss, spoilage, unserviceability, unsuitability, or destruction of, or 

damage to, property of the United States under the control of the 

Department of Defense. 

(b) FINALITY OF ACTION.—(1) Action taken under subsection (a) 

is final except as provided in paragraph (2). 

(2) An action holding a person pecuniarily liable for loss, spoilage, destruction, or damage is not final until approved by a person 

designated to do so by the Secretary of a military department, commander of a combatant command, or Director of a Defense Agency, 

as the case may be, who has jurisdiction of the person held pecuniarily liable. The person designated to provide final approval shall 
§ 2788 CH. 165—ACCOUNTABILITY AND RESPONSIBILITY 1600 

be an officer of an armed force, or a civilian employee, under the 

jurisdiction of the official making the designation. 

(c) REGULATIONS.—The Secretary of Defense shall prescribe 

regulations to carry out this section. 

(Added Pub. L. 107–314, div. A, title X, Sec. 1006(a)(1), Dec. 2, 2002, 116 Stat. 2632.) 

§ 2788. Property accountability: regulations 

The Secretary of a military department may prescribe regulations for the accounting for the property of that department and 

the fixing of responsibility for that property. 

(Added Pub. L. 110–181, div. A, title III, Sec. 375(a), Jan. 28, 2008, 122 Stat. 83.) 

§ 2789. Individual equipment: unauthorized disposition 

(a) PROHIBITION.—No member of the armed forces may sell, 

lend, pledge, barter, or give any clothing, arms, or equipment furnished to such member by the United States to any person other 

than a member of the armed forces or an officer of the United 

States who is authorized to receive it. 

(b) SEIZURE OF IMPROPERLY DISPOSED PROPERTY.—If a member 

of the armed forces has disposed of property in violation of subsection (a) and the property is in the possession of a person who 

is neither a member of the armed forces nor an officer of the 

United States who is authorized to receive it, that person has no 

right to or interest in the property, and any civil or military officer 

of the United States may seize the property, wherever found, subject to applicable regulations. Possession of such property furnished 

by the United States to a member of the armed forces by a person 

who is neither a member of the armed forces, nor an officer of the 

United States, is prima facie evidence that the property has been 

disposed of in violation of subsection (a). 

(c) DELIVERY OF SEIZED PROPERTY.—If an officer who seizes 

property under subsection (b) is not authorized to retain it for the 

United States, the officer shall deliver the property to a person who 

is authorized to retain it. 

(Added Pub. L. 110–181, div. A, title III, Sec. 375(a), Jan. 28, 2008, 122 Stat. 83.) 

§ 2790. Recovery of improperly disposed of Department of 

Defense property 

(a) PROHIBITION.—No member of the armed forces, civilian employee of the United States Government, contractor personnel, or 

other person may sell, lend, pledge, barter, or give any clothing, 

arms, articles, equipment, or other military or Department of Defense property except in accordance with the statutes and regulations governing Government property. 

(b) TRANSFER OF TITLE OR INTEREST INEFFECTIVE.—If property 

has been disposed of in violation of subsection (a), the person holding the property has no right or title to, or interest in, the property. 

(c) AUTHORITY FOR SEIZURE OF IMPROPERLY DISPOSED OF PROPERTY.—If any person is in the possession of military or Department 

of Defense property without right or title to, or interest in, the 

property because it has been disposed of in material violation of 

subsection (a), any Federal, State, or local law enforcement official 

may seize the property wherever found. Unless an exception to the 
1601 § 2790 CH. 165—ACCOUNTABILITY AND RESPONSIBILITY 

warrant requirement under the fourth amendment to the Constitution applies, seizure may be made only— 

(1) pursuant to— 

(A) a warrant issued by the district court of the United 

States for the district in which the property is located, or 

for the district in which the person in possession of the 

property resides or is subject to service; or 

(B) pursuant to an order by such court, issued after a 

determination of improper transfer under subsection (e); 

and 

(2) after such a court has issued such a warrant or order. 

(d) INAPPLICABILITY TO CERTAIN PROPERTY.—Subsections (b) 

and (c) shall not apply to— 

(1) property on public display by public or private collectors or museums in secured exhibits; or 

(2) property in the collection of any museum or veterans 

organization or held in a private collection for the purpose of 

public display, provided that any such property, the possession 

of which could undermine national security or create a hazard 

to public health or safety, has been fully demilitarized. 

(e) DETERMINATIONS OF VIOLATIONS.—(1) The district court of 

the United States for the district in which the property is located, 

or the district in which the person in possession of the property resides or is subject to service, shall have jurisdiction, regardless of 

the current approximated or estimated value of the property, to determine whether property was disposed of in violation of subsection 

(a). Any such determination shall be by a preponderance of the 

evidence. 

(2) Except as provided in paragraph (3), in the case of property, 

the possession of which could undermine national security or create 

a hazard to public health or safety, the determination under paragraph (1) may be made after the seizure of the property, as long 

as the United States files an action seeking such determination 

within 90 days after seizure of the property. If the person from 

whom the property is seized is found to have been lawfully in possession of the property and the return of the property could undermine national security or create a hazard to public health or safety, 

the Secretary of Defense shall reimburse the person for the market 

value for the property. 

(3) Paragraph (2) shall not apply to any firearm, ammunition, 

or ammunition component, or firearm part or accessory that is not 

prohibited for commercial sale. 

(f) DELIVERY OF SEIZED PROPERTY.—Any law enforcement official who seizes property under subsection (c) and is not authorized 

to retain it for the United States shall deliver the property to an 

authorized member of the armed forces or other authorized official 

of the Department of Defense or the Department of Justice. 

(g) SCOPE OF ENFORCEMENT.—This section shall apply to the 

following: 

(1) Any military or Department of Defense property disposed of on or after the date of the enactment of the Ike Skelton National Defense Authorization Act for Fiscal Year 2011 in 

a manner that is not in accordance with statutes and regula-
§ 2790 CH. 165—ACCOUNTABILITY AND RESPONSIBILITY 1602 

tions governing Government property in effect at the time of 

the disposal of such property. 

(2) Any significant military equipment disposed of on or 

after January 1, 2002, in a manner that is not in accordance 

with statutes and regulations governing Government property 

in effect at the time of the disposal of such significant military 

equipment. 

(h) RULE OF CONSTRUCTION.—The authority of this section is 

in addition to any other authority of the United States with respect 

to property to which the United States may have right or title. 

(i) DEFINITIONS.—In this section: 

(1) The term ‘‘significant military equipment’’ means defense articles on the United States Munitions List for which 

special export controls are warranted because of their capacity 

for substantial military utility or capability. 

(2) The term ‘‘museum’’ has the meaning given that term 

in section 273(1) of the Museum Services Act (20 U.S.C. 

9172(1)). 

(3) The term ‘‘fully demilitarized’’ means, with respect to 

equipment or material, the destruction of the military offensive 

or defensive advantages inherent in the equipment or material, 

including, at a minimum, the destruction or disabling of key 

points of such equipment or material, such as the fuselage, tail 

assembly, wing spar, armor, radar and radomes, armament 

and armament provisions, operating systems and software, and 

classified items. 

(4) The term ‘‘veterans organization’’ means any organization recognized by the Secretary of Veterans Affairs for the 

representation of veterans under section 5902 of title 38. 

(Added Pub. L. 111–383, div. A, title III, Sec. 355(a), Jan. 7, 2011, 124 Stat. 4195.) 
1603 

[CHAPTER 167—REPEALED] 

[§ 2791. Repealed. Pub. L. 104–201, div. A, title XI, Sec. 

1121(b), Sept. 23, 1996, 110 Stat. 2687] 

[§§ 2792 to 2796. Renumbered §§ 451 to 455] 

[§ 2797. Repealed. Pub. L. 104–201, div. A, title XI, Sec. 

1121(b), Sept. 23, 1996, 110 Stat. 2687] 

[§ 2798. Renumbered § 456] 
1604 

CHAPTER 169—MILITARY CONSTRUCTION AND 

MILITARY FAMILY HOUSING 

Subchapter Sec. 

I. Military Construction ................................................................................. 2801 

II. Military Family Housing ........................................................................... 2821 

III. Administration of Military Construction and Military Family Housing ............................................................................................................ 2851 

IV. Alternative Authority for Acquisition and Improvement of Military 

Housing ................................................................................................... 2871 

SUBCHAPTER I—MILITARY CONSTRUCTION 

Sec. 

2801. Scope of chapter; definitions. 

2802. Military construction projects. 

2803. Emergency construction. 

2804. Contingency construction. 

2805. Unspecified minor construction. 

2806. Contributions for North Atlantic Treaty Organizations Security Investment. 

2807. Architectural and engineering services and construction design. 

2808. Construction authority in the event of a declaration of war or national 

emergency. 

2809. Long-term facilities contracts for certain activities and services. 

[2810. Repealed.] 

2811. Repair of facilities. 

2812. Lease-purchase of facilities. 

2813. Acquisition of existing facilities in lieu of authorized construction. 

2814. Special authority for development of Ford Island, Hawaii. 

2815. Joint use military construction projects: annual evaluation. 

§ 2801. Scope of chapter; definitions 

(a) The term ‘‘military construction’’ as used in this chapter or 

any other provision of law includes any construction, development, 

conversion, or extension of any kind carried out with respect to a 

military installation, whether to satisfy temporary or permanent 

requirements, or any acquisition of land or construction of a defense access road (as described in section 210 of title 23). 

(b) A military construction project includes all military construction work, or any contribution authorized by this chapter, necessary to produce a complete and usable facility or a complete and 

usable improvement to an existing facility (or to produce such portion of a complete and usable facility or improvement as is specifically authorized by law). 

(c) In this chapter and chapter 173 of this title: 

(1) The term ‘‘appropriate committees of Congress’’ means 

the congressional defense committees and, with respect to any 

project to be carried out by, or for the use of, an intelligence 

component of the Department of Defense, the Permanent Select Committee on Intelligence of the House of Representatives 

and the Select Committee on Intelligence of the Senate. 
1605 § 2802 CH. 169—MIL. CONSTRUCTION & MIL. FAMILY HOUSING 

(2) The term ‘‘facility’’ means a building, structure, or 

other improvement to real property. 

(3) The term ‘‘life-cycle cost-effective’’, with respect to a 

project, product, or measure, means that the sum of the 

present values of investment costs, capital costs, installation 

costs, energy costs, operating costs, maintenance costs, and replacement costs, as estimated for the lifetime of the project, 

product, or measure, does not exceed the base case (current or 

standard) for the practice, product, or measure. 

(4) The term ‘‘military installation’’ means a base, camp, 

post, station, yard, center, or other activity under the jurisdiction of the Secretary of a military department or, in the case 

of an activity in a foreign country, under the operational control of the Secretary of a military department or the Secretary 

of Defense, without regard to the duration of operational control. 

(5) The term ‘‘Secretary concerned’’ includes the Secretary 

of Defense with respect to matters concerning the Defense 

Agencies. 

(d) This chapter (other than sections 2830, 2835, and 2836 of 

this chapter) does not apply to the Coast Guard or to civil works 

projects of the Army Corps of Engineers. 

(Added Pub. L. 97–214, Sec. 2(a), July 12, 1982, 96 Stat. 153; amended Pub. L. 100–26, Sec. 

7(k)(2), Apr. 21, 1987, 101 Stat. 284; Pub. L. 100–180, div. A, title VI, Sec. 632(b)(1), title XII, 

Sec. 1231(15), div. B, subdiv. 3, title I, Sec. 2306(b), Dec. 4, 1987, 101 Stat. 1105, 1160, 1216; 

Pub. L. 102–484, div. A, title X, Sec. 1052(37), Oct. 23, 1992, 106 Stat. 2501; Pub. L. 102–496, 

title IV, Sec. 403(b), Oct. 24, 1992, 106 Stat. 3185; Pub. L. 104–106, div. A, title XV, Sec. 

1502(a)(10), Feb. 10, 1996, 110 Stat. 503; Pub. L. 106–65, div. A, title X, Sec. 1067(1), Oct. 5, 

1999, 113 Stat. 774; Pub. L. 108–136, div. A, title X, Sec. 1043(b)(16), div. B, title XXVIII, Sec. 

2801, Nov. 24, 2003, 117 Stat. 1611, 1719; Pub. L. 109–163, div. A, title X, Sec. 1056(c)(9), Jan. 

6, 2006, 119 Stat. 3440; Pub. L. 109–364, div. B, title XXVIII, Sec. 2851(b)(4), Oct. 17, 2006, 

120 Stat. 2495; Pub. L. 110–181, div. B, title XXVIII, Sec. 2802(b), Jan. 28, 2008, 122 Stat. 539; 

Pub. L. 110–417, div. B, title XXVIII, Sec. 2801(a), Oct. 14, 2008, 122 Stat. 4719.) 

§ 2802. Military construction projects 

(a) The Secretary of Defense and the Secretaries of the military 

departments may carry out such military construction projects, 

land acquisitions, and defense access road projects (as described 

under section 210 of title 23) as are authorized by law. 

(b) Authority provided by law to carry out a military construction project includes authority for— 

(1) surveys and site preparation; 

(2) acquisition, conversion, rehabilitation, and installation 

of facilities; 

(3) acquisition and installation of equipment and appurtenances integral to the project; 

(4) acquisition and installation of supporting facilities (including utilities) and appurtenances incident to the project; 

and 

(5) planning, supervision, administration, and overhead incident to the project. 

(c) In determining the scope of a proposed military construction 

project, the Secretary concerned shall submit to the President such 

recommendations as the Secretary considers to be appropriate regarding the incorporation and inclusion of life-cycle cost-effective 

practices as an element in the project documents submitted to Congress in connection with the budget submitted pursuant to section 
§ 2803 CH. 169—MIL. CONSTRUCTION & MIL. FAMILY HOUSING 1606 

1105 of title 31 for the fiscal year in which a contract is proposed 

to be awarded for the project. 

(Added Pub. L. 97–214, Sec. 2(a), July 12, 1982, 96 Stat. 154; amended Pub. L. 110–181, div. 

B, title XXVIII, Sec. 2802(a), Jan. 28, 2008, 122 Stat. 539; Pub. L. 110–417, div. B, title XXVIII, 

Sec. 2801(b), Oct. 14, 2008, 122 Stat. 4719.) 

§ 2803. Emergency construction 

(a) Subject to subsections (b) and (c), the Secretary concerned 

may carry out a military construction project not otherwise authorized by law if the Secretary determines (1) that the project is vital 

to the national security or to the protection of health, safety, or the 

quality of the environment, and (2) that the requirement for the 

project is so urgent that deferral of the project for inclusion in the 

next Military Construction Authorization Act would be inconsistent 

with national security or the protection of health, safety, or environmental quality, as the case may be. 

(b) When a decision is made to carry out a military construction project under this section, the Secretary concerned shall submit a report in writing to the appropriate committees of Congress 

on that decision. Each such report shall include (1) the justification 

for the project and the current estimate of the cost of the project, 

(2) the justification for carrying out the project under this section, 

and (3) a statement of the source of the funds to be used to carry 

out the project. The project may then be carried out only after the 

end of the 21-day period beginning on the date the notification is 

received by such committees or, if earlier, the end of the seven-day 

period beginning on the date on which a copy of the notification is 

provided in an electronic medium pursuant to section 480 of this 

title. 

(c)(1) The maximum amount that the Secretary concerned may 

obligate in any fiscal year under this section is $50,000,000. 

(2) A project carried out under this section shall be carried out 

within the total amount of funds appropriated for military construction that have not been obligated. 

(Added Pub. L. 97–214, Sec. 2(a), July 12, 1982, 96 Stat. 154; amended Pub. L. 102–190, div. 

B, title XXVIII, Sec. 2803, 2870(2), Dec. 5, 1991, 105 Stat. 1537, 1562; Pub. L. 102–484, div. 

A, title X, Sec. 1053(9), Oct. 23, 1992, 106 Stat. 2502; Pub. L. 108–136, div. A, title X, Sec. 

1031(a)(34), div. B, title XXVIII, Sec. 2802, Nov. 24, 2003, 117 Stat. 1600, 1719; Pub. L. 109– 

364, div. B, title XXVIII, Sec. 2801, Oct. 17, 2006, 120 Stat. 2466.) 

§ 2804. Contingency construction 

(a) Within the amount appropriated for such purpose, the Secretary of Defense may carry out a military construction project not 

otherwise authorized by law, or may authorize the Secretary of a 

military department to carry out such a project, if the Secretary of 

Defense determines that deferral of the project for inclusion in the 

next Military Construction Authorization Act would be inconsistent 

with national security or national interest. 

(b) When a decision is made to carry out a military construction project under this section, the Secretary of Defense shall submit a report in writing to the appropriate committees of Congress 

on that decision. Each such report shall include (1) the justification 

for the project and the current estimate of the cost of the project, 

and (2) the justification for carrying out the project under this section. The project may then be carried out only after the end of the 
1607 § 2805 CH. 169—MIL. CONSTRUCTION & MIL. FAMILY HOUSING 

14-day period beginning on the date the notification is received by 

such committees or, if earlier, the end of the seven-day period beginning on the date on which a copy of the notification is provided 

in an electronic medium pursuant to section 480 of this title. 

(Added Pub. L. 97–214, Sec. 2(a), July 12, 1982, 96 Stat. 155; amended Pub. L. 102–190, div. 

B, title XXVIII, Sec. 2870(3), Dec. 5, 1991, 105 Stat. 1563; Pub. L. 108–136, div. A, title X, Sec. 

1031(a)(35), Nov. 24, 2003, 117 Stat. 1600; Pub. L. 109–163, div. B, title XXVIII, Sec. 2801(a), 

Jan. 6, 2006, 119 Stat. 3504.) 

§ 2805. Unspecified minor construction 

(a) AUTHORITY TO CARRY OUT UNSPECIFIED MINOR MILITARY

CONSTRUCTION PROJECTS.—(1) Within an amount equal to 125 percent of the amount authorized by law for such purpose, the Secretary concerned may carry out unspecified minor military construction projects not otherwise authorized by law. 

(2) An unspecified minor military construction project is a military construction project that has an approved cost equal to or less 

than $2,000,000. However, if the military construction project is intended solely to correct a deficiency that is life-threatening, healththreatening, or safety-threatening, an unspecified minor military 

construction project may have an approved cost equal to or less 

than $3,000,000. 

(b) APPROVAL AND CONGRESSIONAL NOTIFICATION.—(1) An unspecified minor military construction project costing more than 

$750,000 may not be carried out under this section unless approved 

in advance by the Secretary concerned. This paragraph shall apply 

even though the project is to be carried out using funds made available to enhance the deployment and mobility of military forces and 

supplies. 

(2) When a decision is made to carry out an unspecified minor 

military construction project to which paragraph (1) is applicable, 

the Secretary concerned shall notify in writing the appropriate 

committees of Congress of that decision, of the justification for the 

project, and of the estimated cost of the project. The project may 

then be carried out only after the end of the 21-day period beginning on the date the notification is received by the committees or, 

if earlier, the end of the 14-day period beginning on the date on 

which a copy of the notification is provided in an electronic medium 

pursuant to section 480 of this title. 

(c) USE OF OPERATION AND MAINTENANCE FUNDS.—(1) Except 

as provided in paragraph (2), the Secretary concerned may spend 

from appropriations available for operation and maintenance 

amounts necessary to carry out an unspecified minor military construction project costing not more than— 

(A) $1,500,000, in the case of an unspecified minor military 

construction project intended solely to correct a deficiency that 

is life-threatening, health-threatening, or safety-threatening; or 

(B) $750,000, in the case of any other unspecified minor 

military construction project.. 

(2) The limitations specified in paragraph (1) shall not apply 

to an unspecified minor military construction project if the project 

is to be carried out using funds made available to enhance the deployment and mobility of military forces and supplies. 

(d) LABORATORY REVITALIZATION.—(1) For the revitalization 

and recapitalization of laboratories owned by the United States and 
§ 2806 CH. 169—MIL. CONSTRUCTION & MIL. FAMILY HOUSING 1608 

under the jurisdiction of the Secretary concerned, the Secretary 

concerned may obligate and expend— 

(A) from appropriations available to the Secretary concerned for operation and maintenance, amounts necessary to 

carry out an unspecified minor military construction project 

costing not more than $2,000,000; or 

(B) from appropriations available to the Secretary concerned for military construction not otherwise authorized by 

law or from funds authorized to be made available under section 219(a) of the Duncan Hunter National Defense Authorization Act for Fiscal Year 2009 (Public Law 110–417; 10 U.S.C. 

2358 note), amounts necessary to carry out an unspecified 

minor military construction project costing not more than 

$4,000,000. 

(2) For an unspecified minor military construction project conducted pursuant to this subsection, $2,000,000 shall be deemed to 

be the amount specified in subsection (b)(1) regarding when advance approval of the project by the Secretary concerned and congressional notification is required. The Secretary of Defense shall 

establish procedures for the review and approval of requests from 

the Secretary of a military department to carry out a construction 

project under this subsection. 

(3) Not later than February 1, 2010, the Secretary of Defense 

shall submit to the congressional defense committees a report on 

the use of the authority provided by this subsection. The report 

shall include a list and description of the construction projects carried out under this subsection, including the location and cost of 

each project. 

(4) In this subsection, the term ‘‘laboratory’’ includes— 

(A) a research, engineering, and development center; and 

(B) a test and evaluation activity. 

(5) The authority to carry out a project under this subsection 

expires on September 30, 2012. 

(e) PROHIBITION ON USE FOR NEW HOUSING UNITS.—Military 

family housing projects for construction of new housing units may 

not be carried out under the authority of this section. 

(Added Pub. L. 97–214, Sec. 2(a), July 12, 1982, 96 Stat. 155; amended Pub. L. 99–167, title 

VIII, Sec. 809, Dec. 3, 1985, 99 Stat. 989; Pub. L. 99–661, div. B, title VII, Sec. 2702(a), Nov. 

14, 1986, 100 Stat. 4040; Pub. L. 100–180, div. B, subdiv. 3, title I, Sec. 2310, Dec. 4, 1987, 

101 Stat. 1217; Pub. L. 101–510, div. A, title XIII, Sec. 1301(16), Nov. 5, 1990, 104 Stat. 1668; 

Pub. L. 102–190, div. B, title XXVIII, Sec. 2807, 2870(4), Dec. 5, 1991, 105 Stat. 1540, 1563; 

Pub. L. 104–106, div. B, title XXVIII, Secs. 2811(a), 2812, Feb. 10, 1996, 110 Stat. 552; Pub. 

L. 104–201, div. B, title XXVIII, Sec. 2801(a), Sept. 23, 1996, 110 Stat. 2787; Pub. L. 105–85, 

div. B, title XXVIII, Sec. 2801, Nov. 18, 1997, 111 Stat. 1989; Pub. L. 107–107, div. B, title 

XXVIII, Sec. 2801, Dec. 28, 2001, 115 Stat. 1305; Pub. L. 108–136, div. A, title X, Sec. 

1031(a)(36), Nov. 24, 2003, 117 Stat. 1600; Pub. L. 110–181, div. B, title XXVIII, Secs. 2803, 

2804, Jan. 28, 2008, 122 Stat. 539; Pub. L. 111–84, div. B, title XXVIII, Sec. 2801(a)(1), (2), (b), 

Oct. 28, 2009, 123 Stat. 2660.) 

§ 2806. Contributions for North Atlantic Treaty Organizations Security Investment 

(a) Within amounts authorized by law for such purpose, the 

Secretary of Defense may make contributions for the United States 

share of the cost of multilateral programs for the acquisition and 

construction of military facilities and installations (including international military headquarters) and for related expenses for the 

collective defense of the North Atlantic Treaty Area. 
1609 § 2807 CH. 169—MIL. CONSTRUCTION & MIL. FAMILY HOUSING 

(b) Funds may not be obligated or expended in connection with 

the North Atlantic Treaty Organization Security Investment program in any year unless such funds have been authorized by law 

for such program. 

(c)(1) The Secretary may make contributions in excess of the 

amount appropriated for contribution under subsection (a) if the 

amount of the contribution in excess of that amount does not exceed 200 percent of the amount specified by section 2805(a) of this 

title as the maximum amount for a minor military construction 

project. 

(2) If the Secretary determines that the amount appropriated 

for contribution under subsection (a) in any fiscal year must be exceeded by more than the amount authorized under paragraph (1), 

the Secretary may make contributions in excess of such amount, 

but not in excess of 125 percent of the amount appropriated (A) 

after submitting a report in writing to the appropriate committees 

of Congress on such increase, including a statement of the reasons 

for the increase and a statement of the source of the funds to be 

used for the increase, and (B) after a period of 21 days has elapsed 

from the date of receipt of the report or, if earlier, a period of 14 

days has elapsed from the date on which a copy of the report is 

provided in an electronic medium pursuant to section 480 of this 

title. 

(Added Pub. L. 97–214, Sec. 2(a), July 12, 1982, 96 Stat. 156; amended Pub. L. 97–321, title 

VIII, Sec. 805(b)(1), Oct. 15, 1982, 96 Stat. 1573; Pub. L. 99–661, div. B, title V, Sec. 2503(a), 

Nov. 14, 1986, 100 Stat. 4039; Pub. L. 100–26, Sec. 7(f)(1), Apr. 21, 1987, 101 Stat. 281; Pub. 

L. 102–190, div. B, title XXVIII, Sec. 2870(5), Dec. 5, 1991, 105 Stat. 1563; Pub. L. 104–201, 

div. B, title XXVIII, Sec. 2802(a), (c)(1), Sept. 23, 1996, 110 Stat. 2787; Pub. L. 111–84, div. B, 

title XXVIII, Sec. 2801(a)(3), Oct. 28, 2009, 123 Stat. 2660; Pub. L. 111–383, div. B, title XXVIII, 

Sec. 2803(b), Jan. 7, 2011, 124 Stat. 4459.) 

§ 2807. Architectural and engineering services and construction design 

(a) Within amounts appropriated for military construction and 

military family housing, the Secretary concerned may obtain architectural and engineering services and may carry out construction 

design in connection with military construction projects, family 

housing projects, and projects undertaken in connection with the 

authority provided under section 2854 of this title that are not otherwise authorized by law. Amounts available for such purposes 

may be used for construction management of projects that are 

funded by foreign governments directly or through international organizations and for which elements of the armed forces of the 

United States are the primary user. 

(b) In the case of architectural and engineering services and 

construction design to be undertaken under subsection (a) for 

which the estimated cost exceeds $1,000,000, the Secretary concerned shall notify the appropriate committees of Congress of the 

scope of the proposed project and the estimated cost of such services before the initial obligation of funds for such services. The Secretary may then obligate funds for such services only after the end 

of the 21-day period beginning on the date on which the notification is received by the committees or, if earlier, the end of the 14- 

day period beginning on the date on which a copy of the report is 

provided in an electronic medium pursuant to section 480 of this 

title. 
§ 2808 CH. 169—MIL. CONSTRUCTION & MIL. FAMILY HOUSING 1610 

(c) If the Secretary concerned determines that the amount authorized for activities under subsection (a) in any fiscal year must 

be increased the Secretary may proceed with activities at such 

higher level (1) after submitting a report in writing to the appropriate committees of Congress on such increase, including a statement of the reasons for the increase and a statement of the source 

of funds to be used for the increase, and (2) after a period of 21 

days has elapsed from the date of receipt of the report or, if over 

sooner, a period of 14 days has elapsed from the date on which a 

copy of the report is provided in an electronic medium pursuant to 

section 480 of this title. 

(d) For architectural and engineering services and construction 

design related to military construction and family housing projects, 

the Secretaries of the military departments may incur obligations 

for contracts or portions of contracts using military construction 

and family housing appropriations from different fiscal years to the 

extent that those appropriations are available for obligation. 

(Added Pub. L. 97–214, Sec. 2(a), July 12, 1982, 96 Stat. 156; amended Pub. L. 98–115, title 

VIII, Sec. 804, Oct. 11, 1983, 97 Stat. 785; Pub. L. 99–661, div. B, title VII, Sec. 2702(b), 2712(a), 

Nov. 14, 1986, 100 Stat. 4040, 4041; Pub. L. 102–190, div. B, title XXVIII, Sec. 2870(6), Dec. 

5, 1991, 105 Stat. 1563; Pub. L. 105–261, div. B, title XXVIII, Sec. 2801, Oct. 21, 1998, 112 Stat. 

2202; Pub. L. 108–136, div. A, title X, Sec. 1031(a)(37), Nov. 24, 2003, 117 Stat. 1601.) 

§ 2808. Construction authority in the event of a declaration 

of war or national emergency 

(a) In the event of a declaration of war or the declaration by 

the President of a national emergency in accordance with the National Emergencies Act (50 U.S.C. 1601 et seq.) that requires use 

of the armed forces, the Secretary of Defense, without regard to 

any other provision of law, may undertake military construction 

projects, and may authorize the Secretaries of the military departments to undertake military construction projects, not otherwise 

authorized by law that are necessary to support such use of the 

armed forces. Such projects may be undertaken only within the 

total amount of funds that have been appropriated for military construction, including funds appropriated for family housing, that 

have not been obligated. 

(b) When a decision is made to undertake military construction 

projects authorized by this section, the Secretary of Defense shall 

notify the appropriate committees of Congress of the decision and 

of the estimated cost of the construction projects, including the cost 

of any real estate action pertaining to those construction projects. 

(c) The authority described in subsection (a) shall terminate 

with respect to any war or national emergency at the end of the 

war or national emergency. 

(Added Pub. L. 97–214, Sec. 2(a), July 12, 1982, 96 Stat. 157.) 

§ 2809. Long-term facilities contracts for certain activities 

and services 

(a) SUBMISSION AND AUTHORIZATION OF PROPOSED PROJECTS.— 

The Secretary concerned may enter into a contract for the procurement of services in connection with the construction, management, 

and operation of a facility on or near a military installation for the 

provision of an activity or service described in subsection (b) if— 
1611 § 2809 CH. 169—MIL. CONSTRUCTION & MIL. FAMILY HOUSING 

(1) the Secretary concerned has identified the proposed 

project for that facility in the budget material submitted to 

Congress by the Secretary of Defense in connection with the 

budget submitted pursuant to section 1105 of title 31 for the 

fiscal year in which the contract is proposed to be awarded; 

(2) the Secretary concerned has determined that the services to be provided at that facility can be more economically 

provided through the use of a long-term contract than through 

the use of conventional means; and 

(3) the project has been authorized by law. 

(b) AUTHORIZED PURPOSES OF CONTRACT.—The activities and 

services referred to in subsection (a) are as follows: 

(1) Child care services. 

(2) Utilities, including potable and waste water treatment 

services. 

(3) Depot supply activities. 

(4) Troop housing. 

(5) Transient quarters. 

(6) Hospital or medical facilities. 

(7) Other logistic and administrative services, other than 

depot maintenance. 

(c) CONDITIONS ON OBLIGATION OF FUNDS.—A contract entered 

into for a project pursuant to subsection (a) shall include the following provisions: 

(1) A statement that the obligation of the United States to 

make payments under the contract in any fiscal year is subject 

to appropriations being provided specifically for that fiscal year 

and specifically for that project. 

(2) A commitment to obligate the necessary amount for 

each fiscal year covered by the contract when and to the extent 

that funds are appropriated for that project for that fiscal year. 

(3) A statement that such a commitment given under the 

authority of this section does not constitute an obligation of the 

United States. 

(d) COMPETITIVE PROCEDURES.—Each contract entered into 

under this section shall be awarded through the use of competitive 

procedures as provided in chapter 137 of this title. In accordance 

with such procedures, the Secretary concerned shall solicit bids or 

proposals for a contract for each project that has been authorized 

by law. 

(e) TERM OF CONTRACT.—A contract under this section may be 

for any period not in excess of 32 years, excluding the period for 

construction. 

(f) NOTICE AND WAIT REQUIREMENTS.—A contract may not be 

entered into under this section until— 

(1) the Secretary concerned submits to the appropriate 

committees of Congress, in writing, a justification of the need 

for the facility for which the contract is to be awarded and an 

economic analysis (based upon accepted life cycle costing procedures) which demonstrates that the proposed contract is cost 

effective when compared with alternative means of furnishing 

the same facility; and 

(2) a period of 21 days has expired following the date on 

which the justification and the economic analysis are received 
[§ 2810 CH. 169—MIL. CONSTRUCTION & MIL. FAMILY HOUSING 1612 

by the committees or, if over sooner, a period of 14 days has 

expired following the date on which a copy of the justification 

and economic analysis are provided in an electronic medium 

pursuant to section 480 of this title. 

(Added Pub. L. 99–167, title VIII, Sec. 811(a), Dec. 3, 1985, 99 Stat. 990; amended Pub. L. 99– 

661, div. A, title XIII, Sec. 1343(a)(20), div. B, title VII, Sec. 2711, Nov. 14, 1986, 100 Stat. 3994, 

4041; Pub. L. 100–180, div. B, subdiv. 3, title I, Sec. 2302(a), (b), Dec. 4, 1987, 101 Stat. 1215; 

Pub. L. 100–456, div. B, title XXVIII, Sec. 2801, Sept. 29, 1988, 102 Stat. 2115; Pub. L. 101– 

189, div. B, title XXVIII, Sec. 2803, Nov. 29, 1989, 103 Stat. 1647; Pub. L. 102–190, div. B, title 

XXVIII, Sec. 2805(a)(1), Dec. 5, 1991, 105 Stat. 1537; Pub. L. 108–136, div. A, title X, Sec. 

1031(a)(38), Nov. 24, 2003, 117 Stat. 1601.) 

[§ 2810. Repealed. Pub. L. 107–314, div. A, title III, Sec. 

313(b), Dec. 2, 2002, 116 Stat. 2507] 

§ 2811. Repair of facilities 

(a) REPAIRS USING OPERATIONS AND MAINTENANCE FUNDS.— 

Using funds available to the Secretary concerned for operation and 

maintenance, the Secretary concerned may carry out repair 

projects for an entire single-purpose facility or one or more functional areas of a multipurpose facility. 

(b) APPROVAL REQUIRED FOR MAJOR REPAIRS.—A repair project 

costing more than $7,500,000 may not be carried out under this 

section unless approved in advance by the Secretary concerned. In 

determining the total cost of a repair project, the Secretary shall 

include all phases of a multi-year repair project to a single facility. 

In considering a repair project for approval, the Secretary shall ensure that the project is consistent with force structure plans, that 

repair of the facility is more cost effective than replacement, and 

that the project is an appropriate use of operation and maintenance 

funds. 

(c) PROHIBITION ON NEW CONSTRUCTION OR ADDITIONS.—Construction of new facilities or additions to existing facilities may not 

be carried out under the authority of this section. 

(d) CONGRESSIONAL NOTIFICATION.—When a decision is made 

to carry out a repair project under this section with an estimated 

cost in excess of $7,500,000, the Secretary concerned shall submit 

to the appropriate committees of Congress a report containing— 

(1) the justification for the repair project and the current 

estimate of the cost of the project, including, in the case of a 

multi-year repair project to a single facility, the total cost of all 

phases of the project; 

(2) if the current estimate of the cost of the repair project 

exceeds 75 percent of the estimated cost of a military construction project to replace the facility, an explanation of the reasons why replacement of the facility is not in the best interest 

of the Government; and 

(3) a description of the elements of military construction, 

including the elements specified in section 2802(b) of this title, 

incorporated into the repair project. 

(e) REPAIR PROJECT DEFINED.—In this section, the term ‘‘repair 

project’’ means a project to restore a real property facility, system, 

or component to such a condition that it may effectively be used for 

its designated functional purpose. 

(Added Pub. L. 99–661, div. A, title III, Sec. 315(a), Nov. 14, 1986, 100 Stat. 3854, Sec. 2810; 

renumbered Sec. 2811, Pub. L. 100–26, Sec. 7(e)(3), Apr. 21, 1987, 101 Stat. 281; amended Pub. 
1613 § 2812 CH. 169—MIL. CONSTRUCTION & MIL. FAMILY HOUSING 

L. 103–337, div. B, title XXVIII, Sec. 2801(a), Oct. 5, 1994, 108 Stat. 3050; Pub. L. 105–85, div. 

B, title XXVIII, Sec. 2802, Nov. 18, 1997, 111 Stat. 1990; Pub. L. 108–375, div. B, title XXVIII, 

Sec. 2801, Oct. 28, 2004, 118 Stat. 2119; Pub. L. 111–84, div. B, title XXVIII, Sec. 2802, Oct. 

28, 2009, 123 Stat. 2661.) 

§ 2812. Lease-purchase of facilities 

(a)(1) The Secretary concerned may enter into an agreement 

with a private contractor for the lease of a facility of the kind specified in paragraph (2) if the facility is provided at the expense of the 

contractor on a military installation under the jurisdiction of the 

Department of Defense. 

(2) The facilities that may be leased pursuant to paragraph (1) 

are as follows: 

(A) Administrative office facilities. 

(B) Troop housing facilities. 

(C) Energy production facilities. 

(D) Utilities, including potable and waste water treatment 

facilities. 

(E) Hospital and medical facilities. 

(F) Transient quarters. 

(G) Depot or storage facilities. 

(H) Child care centers. 

(I) Classroom and laboratories. 

(b) Leases entered into under subsection (a)— 

(1) may not exceed a term of 32 years; 

(2) shall provide that, at the end of the term of the lease, 

title to the leased facility shall vest in the United States; and 

(3) shall include such other terms and conditions as the 

Secretary concerned determines are necessary or desirable to 

protect the interests of the United States. 

(c)(1) The Secretary concerned may not enter into a lease 

under this section until— 

(A) the Secretary submits to the appropriate committees of 

Congress a justification of the need for the facility for which 

the proposed lease is being entered into and an economic analysis (based upon accepted life-cycle costing procedures) that 

demonstrates the cost effectiveness of the proposed lease compared with a military construction project for the same facility; 

and 

(B) a period of 21 days has expired following the date on 

which the justification and economic analysis are received by 

the committees or, if over sooner, a period of 14 days has expired following the date on which a copy of the justification 

and economic analysis are provided in an electronic medium 

pursuant to section 480 of this title. 

(2) Each Secretary concerned may, under this section, enter 

into— 

(A) not more than three leases in fiscal year 1990; and 

(B) not more than five leases in each of the fiscal years 

1991 and 1992. 

(d) Each lease entered into under this section shall include a 

provision that the obligation of the United States to make payments under the lease in any fiscal year is subject to the availability of appropriations for that purpose. 
§ 2813 CH. 169—MIL. CONSTRUCTION & MIL. FAMILY HOUSING 1614 

(Added Pub. L. 101–189, div. B, title XXVIII, Sec. 2809(a), Nov. 29, 1989, 103 Stat. 1649; 

amended Pub. L. 101–510, div. B, title XXVIII, Sec. 2864, Nov. 5, 1990, 104 Stat. 1806; Pub. 

L. 108–136, div. A, title X, Sec. 1031(a)(39), Nov. 24, 2003, 117 Stat. 1601.) 

§ 2813. Acquisition of existing facilities in lieu of authorized 

construction 

(a) ACQUISITION AUTHORITY.—Using funds appropriated for a 

military construction project authorized by law for a military installation, the Secretary of the military department concerned may 

acquire an existing facility (including the real property on which 

the facility is located) at or near the military installation instead 

of carrying out the authorized military construction project if the 

Secretary determines that— 

(1) the acquisition of the facility satisfies the requirements 

of the military department concerned for the authorized military construction project; and 

(2) it is in the best interests of the United States to acquire the facility instead of carrying out the authorized military construction project. 

(b) MODIFICATION OR CONVERSION OF ACQUIRED FACILITY.—(1) 

As part of the acquisition of an existing facility under subsection 

(a), the Secretary of the military department concerned may carry 

out such modifications, repairs, or conversions of the facility as the 

Secretary considers to be necessary so that the facility satisfies the 

requirements for which the military construction project was authorized. 

(2) The costs of anticipated modifications, repairs, or conversions under paragraph (1) are required to remain within the authorized amount of the military construction project. The Secretary 

concerned shall consider such costs in determining whether the acquisition of an existing facility is— 

(A) more cost effective than carrying out the authorized 

military construction project; and 

(B) in the best interests of the United States. 

(c) NOTICE AND WAIT REQUIREMENTS.—A contract may not be 

entered into for the acquisition of a facility under subsection (a) 

until the Secretary concerned transmits to the appropriate committees of Congress a written notification of the determination to acquire an existing facility instead of carrying out the authorized 

military construction project. The notification shall include the reasons for acquiring the facility. After the notification is transmitted, 

the Secretary may then enter into the contract only after the end 

of the 21-day period beginning on the date on which the notification is received by the committees or, if earlier, the end of the 14- 

day period beginning on the date on which a copy of the report is 

provided in an electronic medium pursuant to section 480 of this 

title. 

(Added Pub. L. 103–160, div. B, title XXVIII, Sec. 2805(a)(1), Nov. 30, 1993, 107 Stat. 1886; Pub. 

L. 104–106, div. A, title XV, Sec. 1502(a)(25), Feb. 10, 1996, 110 Stat. 506; Pub. L. 108–136, 

div. A, title X, Sec. 1031(a)(40), Nov. 24, 2003, 117 Stat. 1601; Pub. L. 109–163, div. B, title 

XXVIII, Sec. 2801(b), Jan. 6, 2006, 119 Stat. 3504.) 

§ 2814. Special authority for development of Ford Island, 

Hawaii 

(a) IN GENERAL.—(1) Subject to paragraph (2), the Secretary of 

the Navy may exercise any authority or combination of authorities 
1615 § 2814 CH. 169—MIL. CONSTRUCTION & MIL. FAMILY HOUSING 

in this section for the purpose of developing or facilitating the development of Ford Island, Hawaii, to the extent that the Secretary 

determines the development is compatible with the mission of the 

Navy. 

(2) The Secretary of the Navy may not exercise any authority 

under this section until— 

(A) the Secretary submits to the appropriate committees of 

Congress a master plan for the development of Ford Island, 

Hawaii; and 

(B) a period of 30 calendar days has elapsed following the 

date on which the notification is received by those committees. 

(b) CONVEYANCE AUTHORITY.—(1) The Secretary of the Navy 

may convey to any public or private person or entity all right, title, 

and interest of the United States in and to any real property (including any improvements thereon) or personal property under the 

jurisdiction of the Secretary in the State of Hawaii that the Secretary determines— 

(A) is excess to the needs of the Navy and all of the other 

armed forces; and 

(B) will promote the purpose of this section. 

(2) A conveyance under this subsection may include such terms 

and conditions as the Secretary considers appropriate to protect the 

interests of the United States. 

(c) LEASE AUTHORITY.—(1) The Secretary of the Navy may 

lease to any public or private person or entity any real property or 

personal property under the jurisdiction of the Secretary in the 

State of Hawaii that the Secretary determines— 

(A) is not needed for current operations of the Navy and 

all of the other armed forces; and 

(B) will promote the purpose of this section. 

(2) A lease under this subsection shall be subject to section 

2667(b)(1) of this title and may include such other terms as the 

Secretary considers appropriate to protect the interests of the 

United States. 

(3) A lease of real property under this subsection may provide 

that, upon termination of the lease term, the lessee shall have the 

right of first refusal to acquire the real property covered by the 

lease if the property is then conveyed under subsection (b). 

(4)(A) The Secretary may provide property support services to 

or for real property leased under this subsection. 

(B) To the extent provided in appropriations Acts, any payment 

made to the Secretary for services provided under this paragraph 

shall be credited to the appropriation, account, or fund from which 

the cost of providing the services was paid. 

(d) ACQUISITION OF LEASEHOLD INTEREST BY SECRETARY.—(1) 

The Secretary of the Navy may acquire a leasehold interest in any 

facility constructed under subsection (f) as consideration for a 

transaction authorized by this section upon such terms as the Secretary considers appropriate to promote the purpose of this section. 

(2) The term of a lease under paragraph (1) may not exceed 10 

years, unless the Secretary of Defense approves a term in excess 

of 10 years for purposes of this section. 
§ 2814 CH. 169—MIL. CONSTRUCTION & MIL. FAMILY HOUSING 1616 

(3) A lease under this subsection may provide that, upon termination of the lease term, the United States shall have the right of 

first refusal to acquire the facility covered by the lease. 

(e) REQUIREMENT FOR COMPETITION.—The Secretary of the 

Navy shall use competitive procedures for purposes of selecting the 

recipient of real or personal property under subsection (b) and the 

lessee of real or personal property under subsection (c). 

(f) CONSIDERATION.—(1) As consideration for the conveyance of 

real or personal property under subsection (b), or for the lease of 

real or personal property under subsection (c), the Secretary of the 

Navy shall accept cash, real property, personal property, or services, or any combination thereof, in an aggregate amount equal to 

not less than the fair market value of the real or personal property 

conveyed or leased. 

(2) Subject to subsection (i), the services accepted by the Secretary under paragraph (1) may include the following: 

(A) The construction or improvement of facilities at Ford 

Island. 

(B) The restoration or rehabilitation of real property at 

Ford Island. 

(C) The provision of property support services for property 

or facilities at Ford Island. 

(g) NOTICE AND WAIT REQUIREMENTS.—The Secretary of the 

Navy may not carry out a transaction authorized by this section 

until— 

(1) the Secretary submits to the appropriate committees of 

Congress a notification of the transaction, including— 

(A) a detailed description of the transaction; and 

(B) a justification for the transaction specifying the 

manner in which the transaction will meet the purposes of 

this section; and 

(2) a period of 30 calendar days has elapsed following the 

date on which the notification is received by those committees 

or, if earlier, a period of 20 days has elapsed from the date on 

which a copy of the notification is provided in an electronic medium pursuant to section 480 of this title. 

(h) FORD ISLAND IMPROVEMENT ACCOUNT.—(1) There is established on the books of the Treasury an account to be known as the 

‘‘Ford Island Improvement Account’’. 

(2) There shall be deposited into the account the following 

amounts: 

(A) Amounts authorized and appropriated to the account. 

(B) Except as provided in subsection (c)(4)(B), the amount 

of any cash payment received by the Secretary for a transaction under this section. 

(i) USE OF ACCOUNT.—(1) Subject to paragraph (2), to the extent provided in advance in appropriations Acts, funds in the Ford 

Island Improvement Account may be used as follows: 

(A) To carry out or facilitate the carrying out of a transaction authorized by this section. 

(B) To carry out improvements of property or facilities at 

Ford Island. 

(C) To obtain property support services for property or facilities at Ford Island. 
1617 § 2815 CH. 169—MIL. CONSTRUCTION & MIL. FAMILY HOUSING 

(2) To extent that the authorities provided under subchapter 

IV of this chapter are available to the Secretary of the Navy, the 

Secretary may not use the authorities in this section to acquire, 

construct, or improve family housing units, military unaccompanied 

housing units, or ancillary supporting facilities related to military 

housing. 

(3)(A) The Secretary may transfer funds from the Ford Island 

Improvement Account to the following funds: 

(i) The Department of Defense Family Housing Improvement Fund established by section 2883(a)(1) of this title. 

(ii) The Department of Defense Military Unaccompanied 

Housing Improvement Fund established by section 2883(a)(2) 

of this title. 

(B) Amounts transferred under subparagraph (A) to a fund referred to in that subparagraph shall be available in accordance 

with the provisions of section 2883 of this title for activities authorized under subchapter IV of this chapter at Ford Island. 

(j) INAPPLICABILITY OF CERTAIN PROPERTY MANAGEMENT

LAWS.—Except as otherwise provided in this section, transactions 

under this section shall not be subject to the following: 

(1) Sections 2667 and 2696 of this title. 

(2) Section 501 of the McKinney-Vento Homeless Assistance Act (42 U.S.C. 11411). 

(3) Subchapter II of chapter 5 and sections 541–555 of title 

40. 

(k) SCORING.—Nothing in this section shall be construed to 

waive the applicability to any lease entered into under this section 

of the budget scorekeeping guidelines used to measure compliance 

with the Balanced Budget and Emergency Deficit Control Act of 

1985. 

(l) PROPERTY SUPPORT SERVICE DEFINED.—In this section, the 

term ‘‘property support service’’ means the following: 

(1) Any utility service or other service listed in section 

2686(a) of this title. 

(2) Any other service determined by the Secretary to be a 

service that supports the operation and maintenance of real 

property, personal property, or facilities. 

(Added Pub. L. 106–65, div. B, title XXVIII, Sec. 2802(a)(1), Oct. 5, 1999, 113 Stat. 845; amended Pub. L. 106–398, Sec. 1 [[div. A], title X, Sec. 1087(a)(16)], Oct. 30, 2000, 114 Stat. 1654, 

1654A–291; Pub. L. 107–107, div. A, title X, Sec. 1048(d)(1), Dec. 28, 2001, 115 Stat. 1227; Pub. 

L. 107–217, Sec. 3(b)(18), Aug. 21, 2002, 116 Stat. 1296; Pub. L. 111–383, div. B, title XXVIII, 

Sec. 2803(c), Jan. 7, 2011, 124 Stat. 4459.) 

§ 2815. Joint use military construction projects: annual evaluation 

(a) JOINT USE MILITARY CONSTRUCTION PROJECT DEFINED.—In 

this section, the term ‘‘joint use military construction project’’ 

means a military construction project for a facility intended to be 

used by— 

(1) both the active and a reserve component of a single 

armed force; or 

(2) two or more components (whether active or reserve 

components) of the armed forces. 

(b) ANNUAL EVALUATION.—In the case of the budget submitted 

under section 1105 of title 31 for any fiscal year, the Secretary of 
§ 2821 CH. 169—MIL. CONSTRUCTION & MIL. FAMILY HOUSING 1618 

Defense shall include in the budget justification materials submitted to Congress in support of the budget a certification by each 

Secretary concerned that, in evaluating military construction 

projects for inclusion in the budget for that fiscal year, the Secretary concerned evaluated the feasibility of carrying out the 

projects as joint use military construction projects. 

(Added Pub. L. 106–398, Sec. 1 [div. B, title XXVIII, Sec. 2801(b)(1)], Oct. 30, 2000, 114 Stat. 

1654, 1654A–412; amended Pub. L. 107–314, div. A, title X, Sec. 1062(a)(14), Dec. 2, 2002, 116 

Stat. 2650.) 

SUBCHAPTER II—MILITARY FAMILY HOUSING 

Sec. 

2821. Requirement for authorization of appropriations for construction and acquisition of military family housing. 

2822. Requirement for authorization of number of family housing units. 

[2823. Repealed.] 

2824. Authorization for acquisition of existing family housing in lieu of construction. 

2825. Improvements to family housing units. 

2826. Military family housing: local comparability of room patterns and floor 

areas. 

2827. Relocation of military family housing units. 

2828. Leasing of military family housing. 

2829. Multi-year contracts for supplies and services. 

2830. Occupancy of substandard family housing units. 

2831. Military family housing management account. 

2832. Homeowners assistance program. 

2833. Family housing support. 

2834. Participation in Department of State housing pools. 

2835. Long-term leasing of military family housing to be constructed. 

2835a. Use of military family housing constructed under build and lease authority to house other members. 

2836. Military housing rental guarantee program. 

2837. Limited partnerships with private developers of housing. 

2838. Leasing of military family housing to Secretary of Defense. 

§ 2821. Requirement for authorization of appropriations for 

construction and acquisition of military family 

housing 

(a) Except as provided in subsection (b), funds may not be appropriated for the construction, acquisition, leasing, addition, extension, expansion, alteration, relocation, or operation and maintenance of family housing under the jurisdiction of the Department 

of Defense unless the appropriation of such funds has been authorized by law. 

(b) In addition to the funds authorized to be appropriated by 

law in any fiscal year for the purposes described in subsection (a), 

there are authorized to be appropriated such additional sums as 

may be necessary for increases in salary, pay, retirement, and 

other employee benefits authorized by law for civilian employees of 

the Department of Defense whose compensation is provided for by 

funds appropriated for the purposes described in such subsection. 

(c) Amounts authorized by law for construction of military family housing units include amounts for (1) site preparation (including demolition), (2) installation of utilities, (3) ancillary supporting 

facilities, (4) shades, screens, ranges, refrigerators, and all other 

equipment and fixtures installed in such units, and (5) construction 

supervision, inspection, and overhead. 
1619 § 2824 CH. 169—MIL. CONSTRUCTION & MIL. FAMILY HOUSING 

(d) Amounts authorized by law for construction and acquisition 

of military family housing and facilities include amounts for— 

(1) minor construction; 

(2) improvements to existing military family housing units 

and facilities; 

(3) relocation of military family housing units under section 2827 of this title; and 

(4) architectural and engineering services and construction 

design. 

(Added Pub. L. 97–214, Sec. 2(a), July 12, 1982, 96 Stat. 157; amended Pub. L. 99–145, title 

XIII, Sec. 1303(a)(18), Nov. 8, 1985, 99 Stat. 739; Pub. L. 99–167, title VIII, Sec. 804(a), Dec. 

3, 1985, 99 Stat. 987.) 

§ 2822. Requirement for authorization of number of family 

housing units 

(a) Except as otherwise provided in subsection (b) or as otherwise authorized by law, the Secretary concerned may not construct 

or acquire military family housing units unless the number of units 

to be constructed or acquired has been specifically authorized by 

law. 

(b) Subsection (a) does not apply to the following: 

(1) Housing units acquired under section 404 of the Housing Amendments of 1955 (42 U.S.C. 1594a). 

(2) Housing units leased under section 2828 of this title. 

(3) Housing units acquired under the Homeowners Assistance Program referred to in section 2832 of this title. 

(4) Housing units acquired without consideration. 

(5) Replacement housing units constructed under section 

2825(c) of this title. 

(6) Housing units constructed or provided under section 

2869 of this title. 

(Added Pub. L. 97–214, Sec. 2(a), July 12, 1982, 96 Stat. 158; amended Pub. L. 98–525, title 

XIV, Sec. 1405(44), Oct. 19, 1984, 98 Stat. 2625; Pub. L. 100–180, div. B, subdiv. 3, title I, Sec. 

2308, Dec. 4, 1987, 101 Stat. 1216; Pub. L. 101–510, div. A, title XIII, Sec. 1301(17), Nov. 5, 

1990, 104 Stat. 1668; Pub. L. 102–25, title VII, Sec. 701(j)(9), Apr. 6, 1991, 105 Stat. 116; Pub. 

L. 102–484, div. B, title XXVIII, Sec. 2802(b), Oct. 23, 1992, 106 Stat. 2606; Pub. L. 108–136, 

div. B, title XXVIII, Sec. 2805(b), Nov. 24, 2003, 117 Stat. 1721.) 

[§ 2823. Repealed. Pub. L. 109–364, div. B, title XXVIII, Sec. 

2803(a), Oct. 17, 2006, 120 Stat. 2467] 

§ 2824. Authorization for acquisition of existing family housing in lieu of construction 

(a) In lieu of constructing any family housing units authorized 

by law to be constructed, the Secretary concerned may acquire sole 

interest in existing family housing units that are privately owned 

or that are held by the Department of Housing and Urban Development, except that in foreign countries the Secretary concerned may 

acquire less than sole interest in existing family housing units. 

(b) When authority provided by law to construct military family housing units is used to acquire existing family housing units 

under subsection (a), the authority includes authority to acquire interests in land. 

(c) The net floor area of a family housing unit acquired under 

the authority of this section may not exceed the applicable limitation specified in section 2826 of this title. The Secretary concerned 
§ 2825 CH. 169—MIL. CONSTRUCTION & MIL. FAMILY HOUSING 1620 

may waive the limitation set forth in the preceding sentence to 

family housing units acquired under this section during the fiveyear period beginning on February 10, 1996. 

(d) Family housing units may not be acquired under this section through the exercise of eminent domain authority. 

(Added Pub. L. 97–214, Sec. 2(a), July 12, 1982, 96 Stat. 159; amended Pub. L. 104–106, div. 

B, title XXVIII, Sec. 2813, Feb. 10, 1996, 110 Stat. 553; Pub. L. 104–201, div. A, title X, Sec. 

1074(a)(17), Sept. 23, 1996, 110 Stat. 2659.) 

§ 2825. Improvements to family housing units 

(a)(1) Authority provided by law to improve existing military 

family housing units and ancillary family housing support facilities 

is authority to make alterations, additions, expansions, and extensions. 

(2) In this section, the term ‘‘improvement’’ includes rehabilitation of a housing unit and major maintenance or repair work to be 

accomplished concurrently with an improvement project. Such term 

does not include day-to-day maintenance and repair work. 

(b)(1) Funds may not be expended for the improvement of any 

single family housing unit, or for the improvement of two or more 

housing units that are to be converted into or are to be used as a 

single family housing unit, if the cost per unit of such improvement 

will exceed (A) $50,000 multiplied by the area construction cost 

index as developed by the Department of Defense for the location 

concerned at the time of contract award, or (B) in the case of improvements necessary to make the unit suitable for habitation by 

a handicapped person, $60,000 multiplied by such index. The Secretary concerned may waive the limitations contained in the preceding sentence if such Secretary determines that, considering the 

useful life of the structure to be improved and the useful life of a 

newly constructed unit and the cost of construction and of operation and maintenance of each kind of unit over its useful life, the 

improvement will be cost-effective. If the Secretary concerned 

makes a determination under the preceding sentence with respect 

to an improvement, the waiver under that sentence with respect to 

that improvement may take effect only after the Secretary transmits a notice of the proposed waiver, together with an economic 

analysis demonstrating that the improvement will be cost effective, 

to the appropriate committees of Congress and a period of 21 days 

has elapsed after the date on which the notification is received by 

those committees or, if over sooner, a period of 14 days has elapsed 

after the date on which a copy of the notice is provided in an electronic medium pursuant to section 480 of this title. 

(2) In determining the applicability of the limitation contained 

in paragraph (1), the Secretary concerned shall include as part of 

the cost of the improvement of the unit or units concerned the following: 

(A) The cost of major maintenance or repair work undertaken in connection with the improvement. 

(B) Any cost, other than the cost of activities undertaken 

beyond a distance of five feet from the unit or units concerned, 

in connection with— 

(i) the furnishing of electricity, gas, water, and sewage 

disposal; 
1621 § 2825 CH. 169—MIL. CONSTRUCTION & MIL. FAMILY HOUSING 

(ii) the construction or repair of roads, drives, and 

walks; and 

(iii) grading and drainage work. 

(3) In determining the applicability of the limitation contained 

in paragraph (1), the Secretary concerned shall not include as part 

of the cost of the improvement of the unit or units concerned the 

following: 

(A) The cost of the installation of communications, security, or antiterrorism equipment required by an occupant of the 

unit or units to perform duties assigned to the occupant as a 

member of the armed forces. 

(B) The cost of the maintenance or repair of equipment described in subparagraph (A) installed for the purpose specified 

in such subparagraph. 

(4) The limitation contained in the first sentence of paragraph 

(1) does not apply to a project for the improvement of a family 

housing unit or units referred to in that sentence if the project (including the amount requested for the project) is identified in the 

budget materials submitted to Congress by the Secretary of Defense in connection with the submission to Congress of the budget 

for a fiscal year pursuant to section 1105 of title 31. 

(c)(1) The Secretary concerned may construct replacement military family housing units in lieu of improving existing military 

family housing units if— 

(A) the improvement of the existing housing units has 

been authorized by law; 

(B) the Secretary determines that the improvement project 

is no longer cost-effective after a review of post-design or bid 

cost estimates; 

(C) the Secretary submits to the committees referred to in 

subsection (b)(1) a notice containing— 

(i) an economic analysis demonstrating that the improvement project would exceed 70 percent of the cost of 

constructing replacement housing units intended for members of the armed forces in the same pay grade or grades 

as those members who occupy the existing housing units; 

and 

(ii) if the replacement housing units are intended for 

members of the armed forces in a different pay grade or 

grades, a justification of the need for the replacement 

housing units based upon the long-term requirements of 

the armed forces in the location concerned; and 

(D) a period of 21 days elapses after the date on which the 

Secretary submits the notice required by subparagraph (C) or, 

if over sooner, a period of 14 days elapses after the date on 

which a copy of the notice is provided in an electronic medium 

pursuant to section 480 of this title. 

(2) The amount that may be expended to construct replacement 

military family housing units under this subsection may not exceed 

the amount that is otherwise available to carry out the previously 

authorized improvement project. 

(d) This section does not apply to projects authorized for restoration or replacement of housing units that have been damaged 

or destroyed. 
§ 2826 CH. 169—MIL. CONSTRUCTION & MIL. FAMILY HOUSING 1622 

(Added Pub. L. 97–214, Sec. 2(a), July 12, 1982, 96 Stat. 159; amended Pub. L. 99–661, div. 

B, title VII, Sec. 2702(c), Nov. 14, 1986, 100 Stat. 4040; Pub. L. 100–26, Sec. 7(k)(3), Apr. 21, 

1987, 101 Stat. 284; Pub. L. 100–180, div. B, subdiv. 3, title I, Sec. 2305, Dec. 4, 1987, 101 Stat. 

1215; Pub. L. 101–189, div. B, title XXVIII, Sec. 2804, Nov. 29, 1989, 103 Stat. 1647; Pub. L. 

101–510, div. B, title XXVIII, Sec. 2812, Nov. 5, 1990, 104 Stat. 1788; Pub. L. 102–484, div. 

B, title XXVIII, Sec. 2802(a), Oct. 23, 1992, 106 Stat. 2605; Pub. L. 103–337, div. B, title XXVIII, 

Sec. 2802, Oct. 5, 1994, 108 Stat. 3050; Pub. L. 104–106, div. A, title XV, Sec. 1502(a)(26), Feb. 

10, 1996, 110 Stat. 506; Pub. L. 104–201, div. B, title XXVIII, Sec. 2803, Sept. 23, 1996, 110 

Stat. 2788; Pub. L. 106–398, Sec. 1 [div. B, title XXVIII, Sec. 2802], Oct. 30, 2000, 114 Stat. 

1654, 1654A–413; Pub. L. 108–136, div. A, title X, Sec. 1031(a)(41), Nov. 24, 2003, 117 Stat. 

1601.) 

§ 2826. Military family housing: local comparability of room 

patterns and floor areas 

(a) LOCAL COMPARABILITY.—In the construction, acquisition, 

and improvement of military family housing, the Secretary concerned shall ensure that the room patterns and floor areas of military family housing in a particular locality (as designated by the 

Secretary concerned for purposes of this section) are similar to 

room patterns and floor areas of similar housing in the private sector in that locality. 

(b) REQUESTS FOR AUTHORITY FOR MILITARY FAMILY HOUSING.—(1) In submitting to Congress a request for authority to carry 

out the construction, acquisition, or improvement of military family 

housing, the Secretary concerned shall include in the request information on the net floor area of each unit of military family housing 

to be constructed, acquired, or improved under the authority. 

(2) In this subsection, the term ‘‘net floor area’’, in the case of 

a military family housing unit, means the total number of square 

feet of the floor space inside the exterior walls of the unit, excluding the floor area of an unfinished basement, an unfinished attic, 

a utility space, a garage, a carport, an open or insect-screened 

porch, a stairwell, and any space used for a solar-energy system. 

(Added Pub. L. 97–214, Sec. 2(a), July 12, 1982, 96 Stat. 159; amended Pub. L. 100–26, Sec. 

7(k)(3), Apr. 21, 1987, 101 Stat. 284; Pub. L. 102–190, div. B, title XXVIII, Sec. 2808, Dec. 5, 

1991, 105 Stat. 1540; Pub. L. 104–106, div. B, title XXVIII, Sec. 2814, 2815, Feb. 10, 1996, 110 

Stat. 553; Pub. L. 104–201, div. A, title X, Sec. 1074(a)(17), Sept. 23, 1996, 110 Stat. 2659; Pub. 

L. 106–398, Sec. 1 [div. B, title XXVIII, Sec. 2803(a)(1)], Oct. 30, 2000, 114 Stat. 1654, 1654A– 

413.) 

§ 2827. Relocation of military family housing units 

(a) Subject to subsection (b), the Secretary concerned may relocate existing military family housing units from any location where 

the number of such units exceeds requirements for military family 

housing to any military installation where there is a housing shortage. 

(b) A contract to carry out a relocation of military family housing units under subsection (a) may not be awarded until (1) the 

Secretary concerned has notified the appropriate committees of 

Congress of the proposed new locations of the housing units to be 

relocated and the estimated cost of and source of funds for the relocation, and (2) a period of 21 days has elapsed after the notification 

has been received by those committees or, if over sooner, a period 

of 14 days has elapsed after the date on which a copy of the notification is provided in an electronic medium pursuant to section 480 

of this title. 

(Added Pub. L. 97–214, Sec. 2(a), July 12, 1982, 96 Stat. 160; amended Pub. L. 108–136, div. 

A, title X, Sec. 1031(a)(42), Nov. 24, 2003, 117 Stat. 1602.) 
1623 § 2828 CH. 169—MIL. CONSTRUCTION & MIL. FAMILY HOUSING 

§ 2828. Leasing of military family housing 

(a)(1) Subject to paragraph (2), the Secretary of the military 

department concerned may lease housing facilities at or near a 

military installation in the United States, Puerto Rico, or Guam for 

assignment, without rental charge, as family housing to members 

of the armed forces and for assignment, with fair market rental 

charge, as family housing to civilian employees of the Department 

of Defense stationed at such installation. 

(2) A lease may only be made under paragraph (1) if the Secretary concerned finds that there is a shortage of adequate housing 

at or near such military installation and that— 

(A) the requirement for such housing is temporary; 

(B) leasing would be more cost effective than construction 

or acquisition of new housing; 

(C) family housing is required for personnel attending 

service school academic courses on permanent change of station orders; 

(D) construction of family housing at such installation has 

been authorized by law but is not yet completed; or 

(E) a military construction authorization bill pending in 

Congress includes a request for authorization of construction of 

family housing at such installation. 

(b)(1) Not more than 10,000 family housing units may be 

leased at any one time under subsection (a). 

(2) Except as provided in paragraphs (3), (4), and (7), expenditures for the rental of housing units under subsection (a) (including 

the cost of utilities, maintenance, and operation) may not exceed 

$12,000 per unit per year, as adjusted from time to time under 

paragraph (5). 

(3) Not more than 500 housing units may be leased under subsection (a) for which the expenditure for the rental of such units 

(including the cost of utilities, maintenance, and operation) exceeds 

the maximum amount per unit per year in effect under paragraph 

(2) but does not exceed $14,000 per unit per year, as adjusted from 

time to time under paragraph (5). 

(4)(A) The Secretary of the Army may lease not more than 

eight housing units in the vicinity of Miami, Florida, for key and 

essential personnel, as designated by the Secretary, for the United 

States Southern Command for which the expenditure for the rental 

of such units (including the cost of utilities, maintenance, and operation, including security enhancements) exceeds the expenditure 

limitations in paragraphs (2) and (3). 

(B) The amount of all leases under this paragraph may not exceed $280,000 per year, as adjusted from time to time under paragraph (6). 

(C) The term of any lease under this paragraph may not exceed 

5 years. 

(D) Until September 30, 2008, the Secretary of the Army may 

authorize family members of a member of the armed forces on active duty who is assigned to a family-member-restricted area and 

who, before such assignment, was occupying a housing unit leased 

under this paragraph, to remain in the leased housing unit until 

the member completes the assignment. Costs incurred for the 
§ 2828 CH. 169—MIL. CONSTRUCTION & MIL. FAMILY HOUSING 1624 

leased housing unit during the assignment shall be included in the 

costs subject to the limitation under subparagraph (B). 

(5) At the beginning of each fiscal year, the Secretary concerned shall adjust the maximum lease amount provided for leases 

under paragraphs (2), (3), and (7) for the previous fiscal year by the 

percentage (if any) by which the national average monthly cost of 

housing (as calculated for purposes of determining rates of basic allowance for housing under section 403 of title 37) for the preceding 

fiscal year exceeds the national average monthly cost of housing (as 

so calculated) for the fiscal year before such preceding fiscal year. 

(6) At the beginning of each fiscal year, the Secretary of the 

Army shall adjust the maximum aggregate amount for leases 

under paragraph (4) for the previous fiscal year by the percentage 

(if any) by which the annual average cost of housing for the Miami 

Military Housing Area (as calculated for purposes of determining 

rates of basic allowance for housing under section 403 of title 37) 

for the preceding fiscal year exceeds the annual average cost of 

housing for the Miami Military Housing Area (as so calculated) for 

the fiscal year before such preceding fiscal year. 

(7)(A) Not more than 600 housing units may be leased by the 

Secretary of the Army under subsection (a) for which the expenditure for the rental of such units (including the cost of utilities, 

maintenance, and operation) exceeds the maximum amount per 

unit per year in effect under paragraph (2) but does not exceed 

$35,000 per unit per year, as adjusted from time to time under 

paragraph (5). 

(B) The maximum lease amount provided in subparagraph (A) 

shall apply only to Army family housing in areas designated by the 

Secretary of the Army. 

(C) The term of a lease under subparagraph (A) may not exceed 2 years. 

(c) The Secretary concerned may lease housing facilities in foreign countries for assignment, without rental charge, as family 

housing to members of the armed forces and for assignment, with 

or without rental charge, as family housing to civilian employees 

of the Department of Defense— 

(1) under circumstances specified in clause (A), (B), (D), or 

(E) of subsection (a)(2); 

(2) for incumbents of special command positions (as determined by the Secretary of Defense); 

(3) in countries where excessive costs of housing or other 

lease terms would cause undue hardship on Department of Defense personnel; and 

(4) in countries that prohibit leases by individual military 

or civilian personnel of the United States. 

(d)(1) Leases of housing units in foreign countries under subsection (c) for assignment as family housing may be for any period 

not in excess of 10 years, or 15 years in the case of leases in Korea, 

and the costs of such leases for any year may be paid out of annual 

appropriations for that year. 

(2) The Secretary may enter into an agreement under this 

paragraph in connection with a lease entered into under subsection 

(c). Such an agreement— 
1625 § 2828 CH. 169—MIL. CONSTRUCTION & MIL. FAMILY HOUSING 

(A) shall be for the purpose of compensating a developer 

for any costs resulting from the termination of the lease during 

the construction of the housing units that are to be occupied 

pursuant to the lease; 

(B) may be for a period not in excess of three years; and 

(C) shall include a provision that the obligation of the 

United States to make payments under the agreement in any 

fiscal year is subject to the availability of appropriations. 

(e)(1) Expenditures for the rental of family housing in foreign 

countries (including the costs of utilities, maintenance, and operation) may not exceed $20,000 per unit per year, except that 450 

units may be leased in foreign countries for not more than $25,000 

per unit per year. These maximum lease amounts may be waived 

by the Secretary concerned with respect to not more than a total 

of 350 such units that are leased for incumbents of special positions 

or for personnel assigned to Defense Attache Offices or that are 

leased in countries where excessive costs of housing would cause 

undue hardship on Department of Defense personnel. 

(2) In addition to the 450 units of family housing referred to in paragraph (1) for which the maximum lease amount is $25,000 

per unit per year, the Secretaries of the military departments may 

lease not more than 3,300 units of family housing in Italy, subject 

to that maximum lease amount. 

(3) In addition to the 450 units of family housing referred to 

in paragraph (1) for which the maximum lease amount is $25,000 

per unit per year, the Secretary of the Army may lease not more 

than 1,175 units of family housing in Korea subject to that maximum lease amount. 

(4) In addition to the units of family housing referred to in 

paragraph (1) for which the maximum lease amount is $25,000 per 

unit per year, the Secretary of the Army may lease not more than 

2,800 units of family housing in Korea subject to a maximum lease 

amount of $35,000 per unit per year. 

(5) The Secretary concerned shall adjust the maximum lease 

amounts provided for under paragraphs (1), (2), (3), and (4) for the 

previous fiscal year— 

(A) for foreign currency fluctuations from October 1, 1987; 

and 

(B) at the beginning of each fiscal year, by the percentage 

(if any) by which the Consumer Price Index for All Urban Consumers, published by the Bureau of Labor Statistics, during 

the preceding fiscal year exceeds such Consumer Price Index 

for the fiscal year before such preceding fiscal year. 

(6) The maximum number of family housing units that may be 

leased in foreign countries under this section at any one time is 

55,775. 

(f) A lease for family housing facilities, or for real property related to family housing facilities, in a foreign country for which the 

average estimated annual rental during the term of the lease exceeds $1,000,000 may not be made under this section until (1) the 

Secretary concerned provides to the appropriate committees of Congress written notification of the facts concerning the proposed 

lease, and (2) a period of 21 days elapses after the notification is 

received by those committees or, if earlier, a period of 14 days has 
§ 2829 CH. 169—MIL. CONSTRUCTION & MIL. FAMILY HOUSING 1626 

elapsed from the date on which a copy of the notification is provided in an electronic medium pursuant to section 480 of this title. 

(g) Appropriations available to the Department of Defense for 

maintenance or construction may be used for the acquisition of interests in land under this section. 

(Added Pub. L. 97–214, Sec. 2(a), July 12, 1982, 96 Stat. 161; amended Pub. L. 97–321, title 

VIII, Sec. 805(b)(2), Oct. 15, 1982, 96 Stat. 1573; Pub. L. 98–115, title VIII, Sec. 801, Oct. 11, 

1983, 97 Stat. 782; Pub. L. 98–407, title VIII, Sec. 806(a), Aug. 28, 1984, 98 Stat. 1521; Pub. 

L. 99–167, title VIII, Sec. 801(b), 803, 805, Dec. 3, 1985, 99 Stat. 985, 987, 988; Pub. L. 99– 

661, div. B, title VII, Sec. 2702(d)–(g), 2713(b), 2714, Nov. 14, 1986, 100 Stat. 4040–4042; Pub. 

L. 100–26, Sec. 7(j)(8), Apr. 21, 1987, 101 Stat. 283; Pub. L. 100–180, div. B, subdiv. 3, title 

I, Sec. 2306(a), 2309, 2311, Dec. 4, 1987, 101 Stat. 1216, 1217; Pub. L. 100–370, Sec. 1(l)(2), 

July 19, 1988, 102 Stat. 849; Pub. L. 100–456, div. B, title XXVIII, Sec. 2802, Sept. 29, 1988, 

102 Stat. 2115; Pub. L. 101–189, div. B, title XXVIII, Sec. 2802, 2805, Nov. 29, 1989, 103 Stat. 

1646, 1647; Pub. L. 102–190, div. B, title XXVIII, Sec. 2806(b), Dec. 5, 1991, 105 Stat. 1540; 

Pub. L. 103–35, title II, Sec. 201(d)(7), May 31, 1993, 107 Stat. 99; Pub. L. 103–160, div. B, 

title XXVIII, Sec. 2801, Nov. 30, 1993, 107 Stat. 1883; Pub. L. 104–106, div. B, title XXVIII, 

Sec. 2816, Feb. 10, 1996, 110 Stat. 553; Pub. L. 105–85, div. B, title XXVIII, Sec. 2803, Nov. 

18, 1997, 111 Stat. 1990; Pub. L. 105–261, div. B, title XXVIII, Sec. 2802, Oct. 17, 1998, 112 

Stat. 2202; Pub. L. 106–398, Sec. 1 [div. B, title XXVIII, Sec. 2804], Oct. 30, 2000, 114 Stat. 

1654, 1654A–414; Pub. L. 107–314, div. A, title X, Sec. 1062(a)(15), div. B, title XXVIII, Sec. 

2801, Dec. 2, 2002, 116 Stat. 2650, 2702; Pub. L. 108–136, div. B, title XXVIII, Secs. 2803, 

2804(a), Nov. 24, 2003, 117 Stat. 1719; Pub. L. 109–163, div. B, title XXVIII, Sec. 2802, Jan. 

6, 2006, 119 Stat. 3505; Pub. L. 109–364, div. B, title XXVIII, Sec. 2804, Oct. 17, 2006, 120 Stat. 

2467; Pub. L. 110–181, div. B, title XXVIII, Sec. 2806(a)–(c), Jan. 28, 2008, 122 Stat. 540, 541; 

Pub. L. 110–417, div. B, title XXVIII, Sec. 2802, Oct. 14, 2008, 122 Stat. 4719; Pub. L. 111– 

383, div. B, title XXVIII, Sec. 2803(d), Jan. 7, 2011, 124 Stat. 4459.) 

§ 2829. Multi-year contracts for supplies and services 

The Secretary concerned may make contracts for periods of up 

to four years for supplies and services for the management, maintenance, and operation of military family housing and may pay the 

costs of such contracts for each year out of annual appropriations 

for that year. 

(Added Pub. L. 97–214, Sec. 2(a), July 12, 1982, 96 Stat. 162.) 

§ 2830. Occupancy of substandard family housing units 

(a)(1) A member of the uniformed services with dependents 

may, without loss of the member’s basic allowance for housing 

under section 403 of title 37, occupy a substandard family housing 

unit under the jurisdiction of the Secretary concerned. 

(2) Occupancy of a family housing unit under paragraph (1) 

shall be subject to a charge against the member’s basic allowance 

for housing in the amount of the fair rental value of the housing 

unit. However, such a charge may not be made in an amount in 

excess of 75 percent of the amount of such allowance. 

(b)(1) The Secretary concerned may lease substandard family 

housing units to members of any of the uniformed services for occupancy by such members. 

(2) The authority to enter into leases under paragraph (1) shall 

be exercised— 

(A) in the case of a lease by the Secretary of a military department, subject to regulations prescribed by the Secretary of 

Defense; and 

(B) in the case of a lease by the Secretary of Homeland Security with respect to the Coast Guard when it is not operating 

as a service in the Navy, subject to regulations prescribed by 

that Secretary. 

(Added Pub. L. 97–214, Sec. 2(a), July 12, 1982, 96 Stat. 162; amended Pub. L. 99–348, title 

III, Sec. 304(a)(4), July 1, 1986, 100 Stat. 703; Pub. L. 100–180, div. A, title VI, Sec. 632(a), 
1627 § 2831 CH. 169—MIL. CONSTRUCTION & MIL. FAMILY HOUSING 

Dec. 4, 1987, 101 Stat. 1105; Pub. L. 105–85, div. A, title VI, Sec. 603(d)(2)(B), Nov. 18, 1997, 

111 Stat. 1782; Pub. L. 107–296, title XVII, Sec. 1704(b)(1), Nov. 25, 2002, 116 Stat. 2314.) 

§ 2831. Military family housing management account 

(a) ESTABLISHMENT.—There is on the books of the Treasury an 

account known as the Department of Defense Military Family 

Housing Management Account (hereinafter in this section referred 

to as the ‘‘account’’). The account shall be used for the management 

and administration of funds appropriated or otherwise made available to the Department of Defense for military family housing programs. 

(b) CREDITS TO ACCOUNT.—The account shall be administered 

as a single account. There shall be transferred into the account— 

(1) appropriations made for the purpose of, or which are 

available for, the payment of costs arising in connection with 

the construction, acquisition, leasing, relocation, operation and 

maintenance, and disposal of military family housing, including the cost of principal and interest charges, and insurance 

premiums, arising in connection with the acquisition of such 

housing, and mortgage insurance premiums payable under section 222(c) of the National Housing Act (12 U.S.C. 1715m(c)); 

(2) proceeds from the rental of family housing and mobile 

home facilities under the control of a military department, reimbursements from the occupants of such facilities for services 

rendered (including utility costs), funds obtained from individuals as a result of losses, damages, or destruction to such facilities caused by the abuse or negligence of such individuals, 

and reimbursements from other Government agencies for expenditures from the account; and 

(3) proceeds of the handling and the disposal of family 

housing of a military department (including related land and 

improvements), whether carried out by a military department 

or any other Federal agency, but less those expenses payable 

pursuant to section 572(a) of title 40. 

(c) AVAILABILITY OF AMOUNTS IN ACCOUNT.—Amounts in the 

account shall remain available until spent. 

(d) USE OF ACCOUNT.—The Secretary concerned may make obligations against the account, in such amounts as may be specified 

from time to time in appropriation Acts, for the purpose of defraying, in the manner and to the extent authorized by law, the costs 

referred to in subsection (b). 

(e) REPORTS ON GENERAL OFFICERS AND FLAG OFFICERS QUAR- TERS.—(1) As part of the budget materials submitted to Congress 

in connection with the submission of the budget for a fiscal year 

pursuant to section 1105 of title 31, the Secretary of Defense shall 

submit a report— 

(A) identifying each family housing unit used, or intended 

for use, as quarters for a general officer or flag officer for 

which the total operation, maintenance, and repair costs for 

the unit are anticipated to exceed $35,000 in the next fiscal 

year; 

(B) for each family housing unit identified under subparagraph (A), specifying the total of such anticipated operation, 

maintenance, and repair costs for the unit; 
§ 2831 CH. 169—MIL. CONSTRUCTION & MIL. FAMILY HOUSING 1628 

(C) identifying each family housing unit in excess of 6,000 

square feet used, or intended for use, as quarters for a general 

officer or flag officer; 

(D) for each family housing unit identified under subparagraph (C), specifying any alternative and more efficient use to 

which the unit could be converted (which would include any 

costs necessary to convert the unit) and containing an explanation of the reasons why the unit is not being converted to 

the alternative use; and 

(E) for each family housing unit identified under subparagraph (C) for which costs under subparagraph (A) or new construction costs are anticipated to exceed $100,000 in the next 

fiscal year, specifying any alternative use to which the unit 

could be converted (which would include any costs necessary to 

convert the unit) and an estimate of the costs to demolish and 

rebuild the unit to private sector standards. 

(2) Not later than 120 days after the end of each fiscal year, 

the Secretary of Defense shall submit to the congressional defense 

committees a report specifying, for each family housing unit used 

as quarters for a general officer or flag officer at any time during 

that fiscal year, the total expenditures for operation and maintenance, utilities, lease, and repairs of the unit during that fiscal 

year. 

(f) NOTICE AND WAIT REQUIREMENT.—(1) Except as provided in 

paragraphs (2) and (3), the Secretary concerned may not carry out 

a maintenance or repair project for a family housing unit used, or 

intended for use, as quarters for a general officer or flag officer if 

the project will or may result in the total operation, maintenance, 

and repair costs for the unit for the fiscal year to exceed $35,000, 

until— 

(A) the Secretary concerned submits to the congressional 

defense committees, in writing, a justification of the need for 

the maintenance or repair project and an estimate of the cost 

of the project; and 

(B) a period of 21 days has expired following the date on 

which the justification and estimate are received by the committees or, if over sooner, a period of 14 days has expired following the date on which a copy of the justification and estimate are provided in an electronic medium pursuant to section 

480 of this title. 

(2) The project justification and cost estimate required by paragraph (1)(A) may be submitted after the commencement of a maintenance or repair project for a family housing unit used, or intended for use, as quarters for a general officer or flag officer if the 

project is a necessary environmental remediation project for the 

unit or is necessary for occupant safety or security, and the need 

for the project arose after the submission of the most recent report 

under subsection (e). 

(3) Paragraph (1) shall not apply in the case of a family housing unit used, or intended for use, as quarters for a general officer 

or flag officer if the unit was identified in the most recent report 

submitted under subsection (e) and the cost of the maintenance or 

repair project was included in the total of anticipated operation, 

maintenance, and repair costs for the unit specified in the report. 
1629 § 2834 CH. 169—MIL. CONSTRUCTION & MIL. FAMILY HOUSING 

(Added Pub. L. 97–214, Sec. 2(a), July 12, 1982, 96 Stat. 162; amended Pub. L. 107–217, Sec. 

3(b)(19), Aug. 21, 2002, 116 Stat. 1297; Pub. L. 108–375, div. B, title XXVIII, Sec. 2802(a), (b), 

Oct. 28, 2004, 118 Stat. 2119, 2120; Pub. L. 109–364, div. A, title X, Sec. 1071(a)(26), div. B, 

title XXVIII, Sec. 2805, Oct. 17, 2006, 120 Stat. 2399, 2467.) 

§ 2832. Homeowners assistance program 

The Secretary of Defense may exercise the authority provided 

in section 1013 of the Demonstration Cities and Metropolitan Development Act of 1966 (42 U.S.C. 3374). 

(Added Pub. L. 97–214, Sec. 2(a), July 12, 1982, 96 Stat. 163; amended Pub. L. 101–189, div. 

B, title XXVIII, Sec. 2831(a), Nov. 29, 1989, 103 Stat. 1660; Pub. L. 104–106, div. A, title XV, 

Sec. 1502(a)(26), Feb. 10, 1996, 110 Stat. 506; Pub. L. 107–107, div. A, title X, Sec. 1048(e)(11), 

Dec. 28, 2001, 115 Stat. 1228.) 

§ 2833. Family housing support 

Amounts authorized by law for support of military family housing include amounts for— 

(1) operating expenses; 

(2) leasing expenses; 

(3) maintenance of real property expenses; 

(4) payments of principal and interest on mortgage debts 

incurred; and 

(5) payments of mortgage insurance premiums authorized 

under section 222 of the National Housing Act (12 U.S.C. 

1715m). 

(Added Pub. L. 99–167, title VIII, Sec. 804(b)(1), Dec. 3, 1985, 99 Stat. 987.) 

§ 2834. Participation in Department of State housing pools 

(a) The Secretary concerned may enter into an agreement with 

the Secretary of State under which the Secretary of State agrees 

to provide housing and related services for personnel under the jurisdiction of the Secretary concerned who are assigned to duty in 

a foreign country if the Secretary concerned determines— 

(1) that there is a shortage of adequate housing in the area 

of the foreign country in which such personnel are assigned to 

duty; and 

(2) that participation in the Department of State housing 

pool is the most cost-effective means of providing housing for 

such personnel. 

The Secretary concerned shall reimburse the Secretary of State, as 

provided in the agreement, for housing and related services furnished personnel under the jurisdiction of the Secretary concerned. 

(b) The maximum lease amounts specified in section 2828(e)(1) 

of this title for the rental of family housing in foreign countries 

shall not apply to housing made available to the Department of Defense under this section. To the extent that the lease amount for 

units of housing made available under this subsection exceeds such 

maximum lease amounts, such units shall not be counted in applying the limitation contained in such section on the number of units 

of family housing for which the Secretary concerned may waive 

such maximum lease amounts. 

(Added Pub. L. 99–167, title VIII, Sec. 808(a), Dec. 3, 1985, 99 Stat. 989; amended Pub. L. 101– 

510, div. A, title XIII, Sec. 1301(18), Nov. 5, 1990, 104 Stat. 1668; Pub. L. 103–160, div. B, title 

XXVIII, Sec. 2806, Nov. 30, 1993, 107 Stat. 1887.) 
§ 2835 CH. 169—MIL. CONSTRUCTION & MIL. FAMILY HOUSING 1630 

§ 2835. Long-term leasing of military family housing to be 

constructed 

(a) BUILD AND LEASE AUTHORIZED.—Subject to subsection (b), 

the Secretary of a military department, or the Secretary of Homeland Security with respect to the Coast Guard, may enter into a 

contract for the lease of family housing units to be constructed or 

rehabilitated to residential use near a military installation within 

the United States under the Secretary’s jurisdiction at which there 

is a shortage of family housing. Housing units leased under this 

section shall be assigned, without rental charge, as family housing 

to members of the armed forces who are eligible for assignment to 

military family housing. 

(b) SUBMISSION AND AUTHORIZATION OF PROPOSED LEASE CONTRACTS.—(1) The Secretary of a military department, or the Secretary of Homeland Security with respect to the Coast Guard, may 

enter into a lease contract under subsection (a) for such military 

housing as is authorized by law for the purposes of this section. 

(2) The budget material submitted to Congress by the Secretary of Defense, and the Secretary of Homeland Security with respect to the Coast Guard, in connection with the budget submitted 

pursuant to section 1105 of title 31 for each fiscal year shall include materials that identify the military housing projects for 

which lease contracts are proposed to be entered into under subsection (a) in such fiscal year. 

(c) COMPETITIVE PROCESS.—Each contract under subsection (a) 

shall be awarded through the use of publicly advertised, competitively bid, or competitively negotiated, contracting procedures as 

provided in chapter 137 of this title. In accordance with such procedures, the Secretary of a military department, or the Secretary of 

Homeland Security, as the case may be, shall solicit bids or proposals for a contract for the lease of military housing authorized in 

accordance with subsection (b)(1). Such a contract may provide for 

the contractor of the housing facilities to operate and maintain 

such housing facilities during the term of the lease. 

(d) CONDITIONS ON OBLIGATION OF FUNDS.—A lease contract 

entered into for a military housing project under subsection (a) 

shall include the following provisions: 

(1) A statement that the obligation of the United States to 

make payments under the contract in any fiscal year is subject 

to appropriations being provided specifically for that fiscal year 

and specifically for that project. 

(2) A commitment to obligate the necessary amount for 

each fiscal year covered by the contract when and to the extent 

that funds are appropriated for that project for that fiscal year. 

(3) A statement that such a commitment entered into 

under the authority of this section does not constitute an obligation of the United States. 

(4) A requirement that housing units constructed pursuant 

to the contract shall be constructed— 

(A) to Department of Defense specifications, in the 

case of a Department of Defense contract; and 

(B) to Department of Homeland Security specifications, in the case of a contract for the Coast Guard. 
1631 § 2835a CH. 169—MIL. CONSTRUCTION & MIL. FAMILY HOUSING 

(e) LEASE TERM.—A contract under this section may be for any 

period not in excess of 20 years (excluding the period required for 

construction of the housing facilities). 

(f) RIGHT OF FIRST REFUSAL TO ACQUIRE.—A contract under 

this section shall provide that, upon the termination of the lease 

period, the United States shall have the right of first refusal to acquire all right, title, and interest to the housing facilities constructed and leased under the contract. 

(g) NOTICE AND WAIT REQUIREMENTS.—A contract may not be 

entered into for the lease of housing facilities under this section 

until— 

(1) the Secretary of Defense, or the Secretary of Homeland 

Security with respect to the Coast Guard, submits to the appropriate committees of Congress, in writing, an economic 

analysis (based upon accepted life cycle costing procedures) 

which demonstrates that the proposed contract is cost-effective 

when compared with alternative means of furnishing the same 

housing facilities; and 

(2) a period of 21 days has expired following the date on 

which the economic analysis is received by those committees 

or, if earlier, a period of 14 days has elapsed from the date on 

which a copy of the analysis is provided in an electronic medium pursuant to section 480 of this title. 

(h) SUPPORT BUILDINGS.—A contract for the lease of family 

housing under this section may include provision for the lease of 

a child care center, civic center building, and similar type buildings 

constructed for the support of family housing. 

(Added Pub. L. 102–190, div. B, title XXVIII, Sec. 2806(a)(1), Dec. 5, 1991, 105 Stat. 1539; 

amended Pub. L. 107–296, title XVII, Sec. 1704(b)(1), Nov. 25, 2002, 116 Stat. 2314; Pub. L. 

111–383, div. B, title XXVIII, Sec. 2803(e), Jan. 7, 2011, 124 Stat. 4459.) 

§ 2835a. Use of military family housing constructed under 

build and lease authority to house other members 

(a) INDIVIDUAL ASSIGNMENT OF MEMBERS WITHOUT DEPENDENTS.—(1) To the extent that the Secretary concerned determines 

that military family housing constructed and leased under section 

2835 of this title is not needed to house members of the armed 

forces eligible for assignment to military family housing, the Secretary may assign, without rental charge, members without dependents to the housing. 

(2) A member without dependents who is assigned to housing 

pursuant to paragraph (1) shall be considered to be assigned to 

quarters pursuant to section 403(e) of title 37. 

(b) CONVERSION TO LONG-TERM LEASING OF MILITARY UNACCOMPANIED HOUSING.—(1) If the Secretary concerned determines 

that military family housing constructed and leased under section 

2835 of this title is excess to the long-term needs of the family 

housing program of the Secretary, the Secretary may convert the 

lease contract entered into under subsection (a) of such section into 

a long-term lease of military unaccompanied housing. 

(2) The term of the lease contract for military unaccompanied 

housing converted from military family housing under paragraph 

(1) may not exceed the remaining term of the lease contract for the 

family housing so converted. 
§ 2836 CH. 169—MIL. CONSTRUCTION & MIL. FAMILY HOUSING 1632 

(c) NOTICE AND WAIT REQUIREMENTS.—(1) The Secretary concerned may not convert military family housing to military unaccompanied housing under subsection (b) until— 

(A) the Secretary submits to the congressional defense 

committees a notice of the intent to undertake the conversion; 

and 

(B) a period of 21 days has expired following the date on 

which the notice is received by the committees or, if earlier, a 

period of 14 days has expired following the date on which a 

copy of the notice is provided in an electronic medium pursuant to section 480 of this title. 

(2) The notice required by paragraph (1) shall include— 

(A) an explanation of the reasons for the conversion of the 

military family housing to military unaccompanied housing; 

(B) a description of the long-term lease to be converted; 

(C) amounts to be paid under the lease; and 

(D) the expiration date of the lease. 

(d) APPLICATION TO HOUSING LEASED UNDER FORMER AUTHORITY.—This section also shall apply to housing initially acquired or 

constructed under the former section 2828(g) of this title (commonly known as the ‘‘Build to Lease program’’), as added by section 

801 of the Military Construction Authorization Act, 1984 (Public 

Law 98–115; 97 Stat 782). 

(Added Pub. L. 110–417, div. B, title XXVIII, Sec. 2803(a), Oct. 14, 2008, 122 Stat. 4719.) 

§ 2836. Military housing rental guarantee program 

(a) AUTHORITY.—Subject to subsection (b), the Secretary of a 

military department, or the Secretary of Homeland Security with 

respect to the Coast Guard, may enter into an agreement to assure 

the occupancy of rental housing to be constructed or rehabilitated 

to residential use by a private developer or by a State or local housing authority on private land, on land owned by a State or local 

government, or on land owned by the United States, if the housing 

is to be located on or near a new military installation or an existing 

military installation that has a shortage of housing to meet the requirements of eligible members of the armed forces (with or without accompanying dependents). The authority provided under this 

subsection shall be exercised under uniform regulations prescribed 

by the Secretary of Defense. 

(b) SUBMISSION AND AUTHORIZATION OF PROPOSED AGREEMENTS.—(1) The Secretary of a military department, or the Secretary of Homeland Security with respect to the Coast Guard, may 

enter into agreements pursuant to subsection (a) for such military 

housing rental guaranty projects as are authorized by law. 

(2) The budget material submitted to Congress by the Secretary of Defense, and the Secretary of Homeland Security with respect to the Coast Guard, in connection with the budget submitted 

pursuant to section 1105 of title 31 for each fiscal year shall include materials that identify the military housing rental guaranty 

projects for which agreements are proposed to be entered into 

under subsection (a) in that fiscal year. 

(c) CONTENT OF AGREEMENT.—An agreement under subsection 

(a)— 
1633 § 2836 CH. 169—MIL. CONSTRUCTION & MIL. FAMILY HOUSING 

(1) may not assure the occupancy of more than 97 percent 

of the units constructed under the agreement; 

(2) shall establish initial rental rates that are not more 

than rates for comparable rental dwelling units in the same 

general market area and may include an escalation clause; 

(3) may apply to existing housing; 

(4) shall require that the housing units be constructed— 

(A) in the case of a Department of Defense agreement, 

to Department of Defense specifications or, at the discretion of the Secretary of the military department concerned, 

in compliance with the local building codes; and 

(B) in the case of an agreement for the Coast Guard, 

to Department of Homeland Security specifications; 

(5) may not be for a term in excess of 25 years; 

(6) may not be renewed unless the project is located on 

government owned land, in which case the renewal period may 

not exceed the original contract term; 

(7) may not assure more than an amount equivalent to the 

shelter rent of the housing units, determined on the basis of 

amortizing initial construction costs; 

(8) may only be entered into to the extent that there is a 

shortage in military family housing; 

(9) may only be entered into if existing military-controlled 

housing at all installations in the commuting area (except for 

a new installation or an installation for which there is projected a significant increase in the number of families due to 

an increase in the number of authorized personnel) has exceeded 97 percent use for a period of not less than 18 consecutive 

months immediately preceding the date on which the agreement is entered into, excluding units temporarily inactivated 

for major repair or improvements; 

(10) shall provide for priority of occupancy for military 

families; 

(11) shall include a provision authorizing the Secretary of 

the military department concerned, or the Secretary of Homeland Security with respect to the Coast Guard, to take such action as the Secretary considers appropriate to protect the interests of the United States, including rendering the agreement 

null and void if, in the opinion of the Secretary, the owner of 

the housing fails to maintain a satisfactory level of operation 

and maintenance; 

(12) may provide in the agreement for the rental of a child 

care center, civic center building, and similar type buildings 

constructed for the support of family housing; 

(13) may provide that utilities, trash collection, snow removal, and entomological services will be furnished by the Federal Government at no cost to the occupant to the same extent 

that these items are provided to occupants of housing owned 

by the Federal Government; and 

(14) may require that rent collection and operation and 

maintenance services in connection with the housing be under 

the terms of a separate agreement or be carried out by personnel of the Federal Government. 
§ 2837 CH. 169—MIL. CONSTRUCTION & MIL. FAMILY HOUSING 1634 

(d) CONDITIONS ON OBLIGATION OF FUNDS.—An agreement entered into for a project pursuant to subsection (a) shall include the 

following provisions: 

(1) A statement that the obligation of the United States to 

make payments under the agreement in any fiscal year is subject to appropriations being provided specifically for that fiscal 

year and specifically for that project. 

(2) A commitment to obligate the necessary amount for 

each fiscal year covered by the agreement when and to the extent that funds are appropriated for such project for such fiscal 

year. 

(3) A statement that such a commitment entered into 

under the authority of this section does not constitute an obligation of the United States. 

(e) COMPETITIVE PROCESS.—An agreement under subsection (a) 

shall be made through the use of publicly advertised, competitively 

bid, or competitively negotiated, contracting procedures as provided 

in chapter 137 of this title. In accordance with such procedures, the 

Secretary of a military department, or the Secretary of Homeland 

Security, as the case may be, shall solicit bids or proposals for a 

guaranty agreement for each military housing rental guaranty 

project authorized in accordance with subsection (b). 

(f) NOTICE AND WAIT REQUIREMENTS.—An agreement may not 

be entered into under subsection (a) until— 

(1) the Secretary of Defense, or the Secretary of Homeland 

Security with respect to the Coast Guard, submits to the appropriate committees of Congress, in writing, an economic 

analysis (based upon accepted life cycle costing procedures) 

which demonstrates that the proposed agreement is cost effective when compared with alternative means of furnishing the 

same housing facilities; and 

(2) a period of 21 days has expired following the date on 

which the economic analysis is received by those committees 

or, if over sooner, a period of 14 days has expired following the 

date on which a copy of the economic analysis is provided in 

an electronic medium pursuant to section 480 of this title. 

(g) DISPUTES.—The Secretary concerned may require that disputes arising under an agreement entered into under subsection (a) 

be decided in accordance with the procedures provided for by chapter 71 of title 41. 

(Added Pub. L. 102–190, div. B, title XXVIII, Sec. 2809(a)(1), Dec. 5, 1991, 105 Stat. 1541; 

amended Pub. L. 107–296, title XVII, Sec. 1704(b)(1), Nov. 25, 2002, 116 Stat. 2314; Pub. L. 

108–136, div. A, title X, Sec. 1031(a)(43), Nov. 24, 2003, 117 Stat. 1602; Pub. L. 111–350, Sec. 

5(b)(48), Jan. 4, 2011, 124 Stat. 3846.) 

§ 2837. Limited partnerships with private developers of 

housing 

(a) LIMITED PARTNERSHIPS.—(1) In order to meet the housing 

requirements of members of the armed forces, and the dependents 

of such members, at a military installation described in paragraph 

(2), the Secretary of a military department may enter into a limited 

partnership with one or more private developers to encourage the 

construction of housing and accessory structures within commuting 

distance of the installation. The Secretary may contribute not less 
1635 § 2837 CH. 169—MIL. CONSTRUCTION & MIL. FAMILY HOUSING 

than five percent, but not more than 35 percent, of the development costs under a limited partnership. 

(2) Paragraph (1) applies to a military installation under the 

jurisdiction of the Secretary concerned at which there is a shortage 

of suitable housing to meet the requirements of members and dependents referred to in such paragraph. 

(b) COLLATERAL INCENTIVE AGREEMENTS.—The Secretary concerned may also enter into collateral incentive agreements with 

private developers who enter into a limited partnership under subsection (a) to ensure that, where appropriate— 

(1) a suitable preference will be afforded members of the 

armed forces in the lease or purchase, as the case may be, of 

a reasonable number of the housing units covered by the limited partnership; or 

(2) the rental rates or sale prices, as the case may be, for 

some or all of such units will be affordable for such members. 

(c) SELECTION OF INVESTMENT OPPORTUNITIES.—(1) The Secretary concerned shall use publicly advertised, competitively bid or 

competitively negotiated, contracting procedures, as provided in 

chapter 137 of this title, to enter into limited partnerships under 

subsection (a). 

(2) When a decision is made to enter into a limited partnership 

under subsection (a), the Secretary shall submit a report in writing 

to the appropriate committees of Congress on that decision. Each 

such report shall include the justification for the limited partnership, the terms and conditions of the limited partnership, a description of the development costs for projects under the limited partnership, and a description of the share of such costs to be incurred 

by the Secretary. The Secretary may then enter into the limited 

partnership only after the end of the 21-day period beginning on 

the date the report is received by such committees or, if earlier, the 

end of the 14-day period beginning on the date on which a copy of 

the report is provided in an electronic medium pursuant to section 

480 of this title. 

(d) ACCOUNT.—(1) There is hereby established on the books of 

the Treasury an account to be known as the ‘‘Defense Housing Investment Account’’. 

(2) There shall be deposited into the Account— 

(A) such funds as may be authorized for and appropriated 

to the Account; and 

(B) any proceeds received by the Secretary concerned from 

the repayment of investments or profits on investments of the 

Secretary under subsection (a). 

(3) From such amounts as are provided in advance in appropriation Acts, funds in the Account shall be available to the Secretaries concerned in amounts determined by the Secretary of Defense for contracts, investments, and expenses necessary for the 

implementation of this section. 

(4) The Secretary concerned may not enter into a contract in 

connection with a limited partnership under subsection (a) or a collateral incentive agreement under subsection (b) unless a sufficient 

amount of the unobligated balance of the funds in the Account is 

available to the Secretary, as of the time the contract is entered 
§ 2838 CH. 169—MIL. CONSTRUCTION & MIL. FAMILY HOUSING 1636 

into, to satisfy the total obligations to be incurred by the United 

States under the contract. 

[(e) Repealed. Pub. L. 104–106, div. B, title XXVIII, Sec. 

2802(d)(1), Feb. 10, 1996, 110 Stat. 552.] 

(f) REPORT.—Not later than 60 days after the end of each fiscal 

year in which activities are carried out under this section, the Secretaries concerned shall jointly transmit to Congress a report specifying the amount and nature of the deposits into, and the expenditures from, the Account during such fiscal year and of the amount 

and nature of all other expenditures made pursuant to such section 

during such fiscal year. 

(g) TRANSFER OF LANDS PROHIBITED.—Nothing in this section 

shall be construed to permit the Secretary, as part of a limited 

partnership entered into under this section, to transfer the right, 

title, or interest of the United States in any real property under 

the jurisdiction of the Secretary concerned. 

(h) EXPIRATION AND TERMINATION OF AUTHORITY.—The authority of the Secretary concerned to enter into a limited partnership 

under this section shall expire on September 30, 2000. 

(Added Pub. L. 103–337, div. B, title XXVIII, Sec. 2803(a), Oct. 5, 1994, 108 Stat. 3051; Pub. 

L. 104–106, div. B, title XXVIII, Sec. 2802, Feb. 10, 1996, 110 Stat. 551; Pub. L. 106–65, div. 

A, title X, Sec. 1066(a)(28), Oct. 5, 1999, 113 Stat. 772; Pub. L. 108–136, div. A, title X, Sec. 

1031(a)(44), Nov. 24, 2003, 117 Stat. 1602.) 

§ 2838. Leasing of military family housing to Secretary of 

Defense 

(a) AUTHORITY.—(1) The Secretary of a military department 

may lease to the Secretary of Defense military family housing in 

the National Capital Region (as defined in section 2674(f) of this 

title). 

(2) In determining the military housing unit to lease under this 

section, the Secretary of Defense should first consider any available 

military housing units that are already substantially equipped for 

executive communications and security. 

(b) RENTAL RATE.—A lease under subsection (a) shall provide 

for the payment by the Secretary of Defense of consideration in an 

amount equal to 105 percent of the monthly rate of basic allowance 

for housing prescribed under section 403(b) of title 37 for a member 

of the uniformed services in the pay grade of O–10 with dependents 

assigned to duty at the military installation on which the leased 

housing unit is located. A rate so established shall be considered 

the fair market value of the lease interest. 

(c) TREATMENT OF PROCEEDS.—(1) The Secretary of a military 

department shall deposit all amounts received pursuant to leases 

entered into by the Secretary under this section into a special account in the Treasury established for such military department. 

(2) The proceeds deposited into the special account of a military department pursuant to paragraph (1) shall be available to the 

Secretary of that military department, without further appropriation, for the maintenance, protection, alteration, repair, improvement, or restoration of military housing on the military installation 

at which the housing leased pursuant to subsection (a) is located. 

(Added Pub. L. 110–417, div. B, title XXVIII, Sec. 2804(a), Oct. 14, 2008, 122 Stat. 4720.) 
1637 § 2851 CH. 169—MIL. CONSTRUCTION & MIL. FAMILY HOUSING 

SUBCHAPTER III—ADMINISTRATION OF MILITARY 

CONSTRUCTION AND MILITARY FAMILY HOUSING 

Sec. 

2851. Supervision of military construction projects. 

2852. Military construction projects: waiver of certain restrictions. 

2853. Authorized cost and scope of work variations. 

2854. Restoration or replacement of damaged or destroyed facilities. 

2854a. Conveyance of damaged or deteriorated military family housing; use of 

proceeds. 

2855. Law applicable to contracts for architectural and engineering services and 

construction design. 

2856. Military unaccompanied housing: local comparability of floor areas. 

[2857. Renumbered.] 

2858. Limitation on the use of funds for expediting a construction project. 

2859. Construction requirements related to antiterrorism and force protection or 

urban-training operations.. 

2860. Availability of appropriations. 

2861. Military construction projects in connection with industrial facility investment program. 

2862. Turn-key selection procedures. 

2863. Payment of contractor claims. 

[2864, 2865. Repealed.] 

2866. Water conservation at military installations. 

2867. Energy monitoring and utility control system specification for military construction and military family housing activities. 

2868. Utility services: furnishing for certain buildings. 

2869. Conveyance of property at military installations to limit encroachment. 

§ 2851. Supervision of military construction projects 

(a) SUPERVISION OF MILITARY DEPARTMENT PROJECTS.—Each 

contract entered into by the United States in connection with a 

military construction project or a military family housing project 

shall be carried out under the direction and supervision of the Secretary of the Army (acting through the Chief of Engineers), the 

Secretary of the Navy (acting through the Commander of the Naval 

Facilities Engineering Command), or such other department or 

Government agency as the Secretary of Defense approves to assure 

the most efficient, expeditious, and cost-effective completion of the 

project. 

(b) SUPERVISION OF DEFENSE AGENCY PROJECTS.—A military 

construction project for an activity or agency of the Department of 

Defense (other than a military department) financed from appropriations for military functions of the Department of Defense shall 

be accomplished by or through a military department designated by 

the Secretary of Defense. 

(c) MAINTENANCE OF MILITARY CONSTRUCTION INFORMATION ON

INTERNET; ACCESS.—(1) The Secretary of Defense shall maintain an 

Internet site that will permit a person to access and view on a separate page of the Internet site a document or other file containing 

the information required by paragraph (2) for the following: 

(A) Each military construction project or military family housing project that has been specifically authorized by 

Act of Congress. 

(B) Each project carried out with funds authorized for 

the operation and maintenance of military family housing. 

(C) Each project carried out with funds authorized for 

the improvement of military family housing units. 
§ 2852 CH. 169—MIL. CONSTRUCTION & MIL. FAMILY HOUSING 1638 

(D) Each unspecified minor construction project carried out under the authority of section 2805(a) of this title. 

(E) Each military construction project or military family housing project regarding which a statutory requirement exists to notify Congress. 

(2) The information to be provided via the Internet site required by paragraph (1) for each project described in such paragraph shall include the following: 

(A) The solicitation date and award date (or anticipated dates) for each contract entered into (or to be entered into) by the United States in connection with the 

project. 

(B) The contract recipient, contract award amount, 

construction milestone schedule proposed by the contractor, and construction completion date stipulated in the 

awarded contract. 

(C) The most current Department of Defense Form 

1391, Military Construction Project Data, for the project. 

(D) The progress of the project, including the percentage of construction currently completed and the current estimated construction completion date. 

(E) The current contract obligation of funds for the 

project, including any changes to the original contract 

award amount. 

(F) If funds appropriated for the project have been diverted for use in another project, the project to which the 

funds were diverted and the amount so diverted. 

(G) For accounts such as planning and design, unspecified minor construction, and family housing operation and 

maintenance, detailed information regarding expenditures 

and anticipated expenditures under these accounts and the 

purposes for which the expenditures are made. 

(3) The information required to be provided for each project described in paragraph (1) shall be made available on the Internet 

site required by such paragraph not later than 90 days after the 

award of a contract or delivery order for the project. The Secretary 

of Defense shall update the required information as promptly as 

practicable, but not less frequently than once a month, to ensure 

that the information is available in a timely manner. 

(Added Pub. L. 97–214, Sec. 2(a), July 12, 1982, 96 Stat. 163; amended Pub. L. 109–163, div. 

B, title XXVIII, Sec. 2803(a), (c), Jan. 6, 2006, 119 Stat. 3505, 3506; Pub. L. 111–383, div. B, 

title XXVIII, Sec. 2801, Jan. 7, 2011, 124 Stat. 4458.) 

§ 2852. Military construction projects: waiver of certain restrictions 

(a) The Secretary of Defense and the Secretaries of the military 

departments may carry out authorized military construction 

projects and authorized military family housing projects without regard to subsections (a) and (b) of section 3324 of title 31. 

(b) Authority to carry out a military construction project or a 

military family housing project may be exercised on land not owned 

by the United States— 

(1) before title to the land on which the project is to be carried out is approved under section 3111 of title 40; and 
1639 § 2853 CH. 169—MIL. CONSTRUCTION & MIL. FAMILY HOUSING 

(2) even though the land will be held in other than a fee 

simple interest in a case in which the Secretary of the military 

department concerned determines that the interest to be acquired in the land is sufficient for the purposes of the project. 

(Added Pub. L. 97–214, Sec. 2(a), July 12, 1982, 96 Stat. 164; amended Pub. L. 97–295, Sec. 

1(35), Oct. 12, 1982, 96 Stat. 1296; Pub. L. 97–321, title VIII, Sec. 805(a)(1), Oct. 15, 1982, 96 

Stat. 1573; Pub. L. 99–145, title XIII, Sec. 1303(a)(19), Nov. 8, 1985, 99 Stat. 739; Pub. L. 107– 

217, Sec. 3(b)(20), Aug. 21, 2002, 116 Stat. 1297.) 

§ 2853. Authorized cost and scope of work variations 

(a) Except as provided in subsection (c) or (d), the cost authorized for a military construction project or for the construction, improvement, and acquisition of a military family housing project 

may be increased or decreased by not more than 25 percent of the 

amount appropriated for such project or 200 percent of the minor 

construction project ceiling specified in section 2805(a)(1), whichever is less, if the Secretary concerned determines that such revised cost is required for the sole purpose of meeting unusual variations in cost and that such variations in cost could not have reasonably been anticipated at the time the project was approved 

originally by Congress. 

(b)(1) Except as provided in subsection (c), the scope of work 

for a military construction project or for the construction, improvement, and acquisition of a military family housing project may be 

reduced by not more than 25 percent from the amount specified for 

that project, construction, improvement, or acquisition in the justification data provided to Congress as part of the request for authorization of the project, construction, improvement, or acquisition. 

(2) The scope of work for a military construction project or for 

the construction, improvement, and acquisition of a military family 

housing project may not be increased above the amount specified 

for that project, construction, improvement, or acquisition in the 

justification data provided to Congress as part of the request for 

authorization of the project, construction, improvement, or acquisition. 

(c) The limitation on cost variations in subsection (a) or the 

limitation on scope reduction in subsection (b)(1) does not apply if 

the variation in cost or reduction in the scope of work is approved 

by the Secretary concerned and— 

(1) in the case of a cost increase or a reduction in the scope 

of work— 

(A) the Secretary concerned notifies the appropriate 

committees of Congress in writing of the cost increase or 

reduction in scope and the reasons therefor, including a 

description of the funds proposed to be used to finance any 

increased costs; and 

(B) a period of 21 days has elapsed after the date on 

which the notification is received by the committees or, if 

over sooner, a period of 14 days has elapsed after the date 

on which a copy of the notification is provided in an electronic medium pursuant to section 480 of this title; or 

(2) in the case of a cost decrease, the Secretary concerned 

notifies the appropriate committees of Congress in writing not 

later than 14 days after the date funds are obligated in connec-
§ 2854 CH. 169—MIL. CONSTRUCTION & MIL. FAMILY HOUSING 1640 

tion with the military construction project or military family 

housing project. 

(d) The limitation on cost variations in subsection (a) does not 

apply to the following: 

(1) The settlement of a contractor claim under a contract. 

(2) The costs associated with the required remediation of 

an environmental hazard in connection with a military construction project or military family housing project, such as asbestos removal, radon abatement, lead-based paint removal or 

abatement, or any other legally required environmental hazard 

remediation, if the required remediation could not have reasonably been anticipated at the time the project was approved 

originally by Congress. 

(Added Pub. L. 97–214, Sec. 2(a), July 12, 1982, 96 Stat. 164; amended Pub. L. 98–407, title 

VIII, Sec. 807, Aug. 28, 1984, 98 Stat. 1521; Pub. L. 100–26, Sec. 7(f)(2), Apr. 21, 1987, 101 

Stat. 281; Pub. L. 100–180, div. B, subdiv. 3, title I, Sec. 2312, 2313, Dec. 4, 1987, 101 Stat. 

1217, 1218; Pub. L. 101–189, div. B, title XXVIII, Sec. 2808, Nov. 29, 1989, 103 Stat. 1648; Pub. 

L. 104–106, div. B, title XXVIII, Sec. 2817, Feb. 10, 1996, 110 Stat. 553; Pub. L. 107–107, div. 

B, title XXVIII, Sec. 2802, Dec. 28, 2001, 115 Stat. 1305; Pub. L. 108–375, div. B, title XXVIII, 

Sec. 2803, Oct. 28, 2004, 118 Stat. 2121; Pub. L. 109–163, div. B, title XXVIII, Sec. 2804(a)– 

(c)(1), Jan. 6, 2006, 119 Stat. 3506; Pub. L. 109–364, div. B, title XXVIII, Sec. 2806, Oct. 17, 

2006, 120 Stat. 2468; Pub. L. 111–84, div. B, title XXVIII, Sec. 2803, Oct. 28, 2009, 123 Stat. 

2661.) 

§ 2854. Restoration or replacement of damaged or destroyed 

facilities 

(a) Subject to subsection (b), the Secretary concerned may repair, restore, or replace a facility under his jurisdiction, including 

a family housing facility, that has been damaged or destroyed. 

(b) When a decision is made to carry out construction under 

this section and the cost of the repair, restoration, or replacement 

is greater than the maximum amount for a minor construction 

project, the Secretary concerned shall notify in writing the appropriate committees of Congress of that decision, of the justification 

for the project, of the current estimate of the cost of the project, of 

the source of funds for the project, and of the justification for carrying out the project under this section. The project may then be 

carried out only after the end of the 21-day period beginning on the 

date the notification is received by such committees or, if earlier, 

the end of the seven-day period beginning on the date on which a 

copy of the notification is provided in an electronic medium pursuant to section 480 of this title. 

(Added Pub. L. 97–214, Sec. 2(a), July 12, 1982, 96 Stat. 165; amended Pub. L. 102–190, div. 

B, title XXVIII, Sec. 2870(7), Dec. 5, 1991, 105 Stat. 1563; Pub. L. 108–136, div. A, title X, Sec. 

1031(a)(45), Nov. 24, 2003, 117 Stat. 1602.) 

§ 2854a. Conveyance of damaged or deteriorated military 

family housing; use of proceeds 

(a) AUTHORITY TO CONVEY.—(1) The Secretary concerned may 

convey any family housing facility that, due to damage or deterioration, is in a condition that is uneconomical to repair. Any conveyance of a family housing facility under this section may include a 

conveyance of the real property associated with the facility conveyed. 

(2) The authority of this section does not apply to family housing facilities located at military installations approved for closure 

under a base closure law or family housing facilities located at an 
1641 § 2854a CH. 169—MIL. CONSTRUCTION & MIL. FAMILY HOUSING 

installation outside the United States at which the Secretary of Defense terminates operations. 

(3) The aggregate total value of the family housing facilities 

conveyed by the Department of Defense under the authority in this 

subsection in any fiscal year may not exceed $5,000,000. 

(4) For purposes of this subsection, a family housing facility is 

in a condition that is uneconomical to repair if the cost of the necessary repairs for the facility would exceed the amount equal to 70 

percent of the cost of constructing a family housing facility to replace such facility. 

(b) CONSIDERATION.—(1) As consideration for the conveyance of 

a family housing facility under subsection (a), the person to whom 

the facility is conveyed shall pay the United States an amount 

equal to the fair market value of the facility conveyed, including 

any real property conveyed along with the facility. 

(2) The Secretary concerned shall determine the fair market 

value of any family housing facility and associated real property 

that is conveyed under subsection (a). Such determination shall be 

final. 

(c) NOTICE AND WAIT REQUIREMENTS.—The Secretary concerned may not enter into an agreement to convey a family housing 

facility under this section until— 

(1) the Secretary submits to the appropriate committees of 

Congress, in writing, a justification for the conveyance under 

the agreement, including— 

(A) an estimate of the consideration to be provided the 

United States under the agreement; 

(B) an estimate of the cost of repairing the family 

housing facility to be conveyed; and 

(C) an estimate of the cost of replacing the family 

housing facility to be conveyed; and 

(2) a period of 21 days has elapsed after the date on which 

the justification is received by the committees or, if over sooner, a period of 14 days has elapsed after the date on which a 

copy of the justification is provided in an electronic medium 

pursuant to section 480 of this title. 

(d) INAPPLICABILITY OF CERTAIN PROPERTY DISPOSAL LAWS.— 

The following provisions of law do not apply to the conveyance of 

a family housing facility under this section: 

(1) Subtitle I of title 40 and division C (except sections 

3302, 3501(b), 3509, 3906, 4710, and 4711) of subtitle I of title 

41. 

(2) Title V of the McKinney-Vento Homeless Assistance 

Act (42 U.S.C. 11411 et seq.). 

(e) USE OF PROCEEDS.—(1) The proceeds of any conveyance of 

a family housing facility under this section shall be credited to the 

appropriate fund established under section 2883 of this title and 

shall be available— 

(A) to construct family housing units to replace the family 

housing facility conveyed under this section, but only to the extent that the number of units constructed with such proceeds 

does not exceed the number of units of military family housing 

of the facility conveyed; 
§ 2855 CH. 169—MIL. CONSTRUCTION & MIL. FAMILY HOUSING 1642 

(B) to repair or restore existing military family housing; 

and 

(C) to reimburse the Secretary concerned for the costs incurred by the Secretary in conveying the family housing facility. 

(2) Notwithstanding section 2883(d) of this title, proceeds derived from a conveyance of a family housing facility under this section shall be available under paragraph (1) without any further appropriation. 

(f) DESCRIPTION OF PROPERTY.—The exact acreage and legal 

description of any family housing facility conveyed under this section, including any real property associated with such facility, shall 

be determined by such means as the Secretary concerned considers 

satisfactory, including by survey in the case of real property. 

(g) ADDITIONAL TERMS AND CONDITIONS.—The Secretary concerned may require such additional terms and conditions in connection with the conveyance of family housing facilities under this section as the Secretary considers appropriate to protect the interests 

of the United States. 

(Added Pub. L. 104–106, div. B, title XXVIII, Sec. 2818(a)(1), Feb. 10, 1996, 110 Stat. 553; 

amended Pub. L. 107–107, div. A, title X, Sec. 1048(d)(1), Dec. 28, 2001, 115 Stat. 1227; Pub. 

L. 107–217, Sec. 3(b)(21), Aug. 21, 2002, 116 Stat. 1297; Pub. L. 108–136, div. A, title X, Sec. 

1031(a)(46), Nov. 24, 2003, 117 Stat. 1602; Pub. L. 111–350, Sec. 5(b)(49), Jan. 4, 2011, 124 Stat. 

3846.) 

§ 2855. Law applicable to contracts for architectural and engineering services and construction design 

(a) Contracts for architectural and engineering services and 

construction design in connection with a military construction 

project or a military family housing project shall be awarded in accordance with chapter 11 of title 40. 

(b)(1) In the case of a contract referred to in subsection (a)— 

(A) if the Secretary concerned estimates that the initial 

award of the contract will be in an amount greater than or 

equal to the threshold amount determined under paragraph 

(2), the contract may not be set aside exclusively for award to 

small business concerns; and 

(B) if the Secretary concerned estimates that the initial 

award of the contract will be in an amount less than the 

threshold amount determined under paragraph (2), the contract shall be awarded in accordance with the set aside provisions of the Small Business Act (15 U.S.C. 631 et seq.). 

(2) The initial threshold amount under paragraph (1) is 

$300,000. The Secretary of Defense may revise that amount in 

order to ensure that small business concerns receive a reasonable 

share of contracts referred to in subsection (a). 

(3) This subsection does not restrict the award of contracts to 

small business concerns under section 8(a) of the Small Business 

Act (15 U.S.C. 637(a)). 

(Added Pub. L. 97–214, Sec. 2(a), July 12, 1982, 96 Stat. 166; amended Pub. L. 98–407, title 

VIII, Sec. 808(a), Aug. 28, 1984, 98 Stat. 1521; Pub. L. 107–217, Sec. 3(b)(22), Aug. 21, 2002, 

116 Stat. 1297; Pub. L. 108–136, div. A, title XIV, Sec. 1427(a), Nov. 24, 2003, 117 Stat. 1670.) 
1643 § 2859 CH. 169—MIL. CONSTRUCTION & MIL. FAMILY HOUSING 

§ 2856. Military unaccompanied housing: local comparability of floor areas 

In the construction, acquisition, and improvement of military 

unaccompanied housing, the Secretary concerned shall ensure that 

the floor areas of such housing in a particular locality (as designated by the Secretary concerned for purposes of this section) do 

not exceed the floor areas of similar housing in the private sector 

in that locality. 

(Added Pub. L. 97–214, Sec. 2(a), July 12, 1982, 96 Stat. 166; amended Pub. L. 101–510, div. 

A, title XIII, Sec. 1301(19), Nov. 5, 1990, 104 Stat. 1668; Pub. L. 109–364, div. B, title XXVIII, 

Sec. 2807(a)(1), Oct. 17, 2006, 120 Stat. 2468.) 

[§ 2857. Renumbered 2915] 

§ 2858. Limitation on the use of funds for expediting a construction project 

Funds appropriated for military construction (including military family housing) may not be expended for additional costs involved in expediting a construction project unless the Secretary 

concerned (1) certifies that expenditures for such costs are necessary to protect the national interest, and (2) establishes a reasonable completion date for the project. In establishing such a completion date, the Secretary shall take into consideration the urgency 

of the requirement for completion of the project, the type and location of the project, the climatic and seasonal conditions affecting 

the construction involved, and the application of economical construction practices. 

(Added Pub. L. 97–214, Sec. 2(a), July 12, 1982, 96 Stat. 167.) 

§ 2859. Construction requirements related to antiterrorism 

and force protection or urban-training operations 

(a) ANTITERRORISM AND FORCE PROTECTION GUIDANCE AND

CRITERIA.—The Secretary of Defense shall develop common guidance and criteria to be used by each Secretary concerned— 

(1) to assess the vulnerability of military installations located inside and outside of the United States to terrorist attack; 

(2) to develop construction standards designed to reduce 

the vulnerability of structures to terrorist attack and improve 

the security of the occupants of such structures; 

(3) to prepare and carry out military construction projects, 

such as gate and fenceline construction, to improve the physical security of military installations; and 

(4) to assist in prioritizing such projects within the military construction budget of each of the armed forces. 

(b) VULNERABILITY ASSESSMENTS.—The Secretary of Defense 

shall require vulnerability assessments of military installations to 

be conducted, at regular intervals, using the criteria developed 

under subsection (a). 

(c) MILITARY CONSTRUCTION REQUIREMENTS.—As part of the 

budget materials submitted to Congress in connection with the submission of the budget for a fiscal year pursuant to section 1105 of 

title 31, but in no case later than March 15 of each year, the Sec-
§ 2860 CH. 169—MIL. CONSTRUCTION & MIL. FAMILY HOUSING 1644 

retary of Defense shall submit a report, in both classified and unclassified form, describing— 

(1) the location and results of the vulnerability assessments conducted under subsection (b) during the most recently 

completed fiscal year; 

(2) the military construction requirements anticipated to 

be necessary during the period covered by the then-current future-years defense plan under section 221 of this title to improve the physical security of military installations; and 

(3) the extent to which funds to meet those requirements 

are not requested in the Department of Defense budget for the 

fiscal year for which the budget is submitted. 

(d) CERTIFICATION REQUIRED FOR MILITARY CONSTRUCTION

PROJECTS DESIGNED TO PROVIDE TRAINING IN URBAN OPER- ATIONS.—(1) Except as provided in paragraph (3), the Secretary 

concerned may not carry out a military construction project to construct a facility designed to provide training in urban operations 

for members of the armed forces or personnel of the Department 

of Defense or other Federal agencies until— 

(A) the Secretary of Defense approves a strategy for training and facility construction for operations in urban terrain; 

and 

(B) the Under Secretary of Defense for Personnel and 

Readiness evaluates the project and certifies to the appropriate 

committees of Congress that the project— 

(i) is consistent with the strategy; and 

(ii) incorporates the appropriate capabilities for joint 

and interagency use in accordance with the strategy. 

(2) The Under Secretary of Defense for Personnel and Readiness shall conduct the evaluation required by paragraph (1)(B) in 

consultation with the Commander of the United States Joint Forces 

Command. 

(3) This subsection shall not apply with respect to a military 

construction project carried out under the authority of section 2803, 

2804, or 2808 of this title or section 2808 of the Military Construction Authorization Act for Fiscal Year 2004 (division B of Public 

Law 108–136; 117 Stat. 1723). 

(Added Pub. L. 108–375, div. B, title XXVIII, Sec. 2804(a)(1), Oct. 28, 2004, 118 Stat. 2121; 

amended Pub. L. 109–364, div. B, title XXVIII, Sec. 2808(a), (b)(1), Oct. 17, 2006, 120 Stat. 

2469.) 

§ 2860. Availability of appropriations 

Funds appropriated to a military department or to the Secretary of Defense for a fiscal year for military construction or military family housing purposes may remain available for obligation 

beyond such fiscal year to the extent provided in appropriation 

Acts. 

(Added Pub. L. 97–214, Sec. 2(a), July 12, 1982, 96 Stat. 167; amended Pub. L. 99–167, title 

VIII, Sec. 812(a), Dec. 3, 1985, 99 Stat. 991; Pub. L. 99–173, Sec. 121(b), Dec. 10, 1985, 99 Stat. 

1029; Pub. L. 99–661, div. A, title XIII, Sec. 1343(a)(21)(A), Nov. 14, 1986, 100 Stat. 3994.) 

§ 2861. Military construction projects in connection with industrial facility investment program 

(a) AUTHORITY.—The Secretary of Defense may carry out a 

military construction project, not previously authorized, for the 
1645 § 2863 CH. 169—MIL. CONSTRUCTION & MIL. FAMILY HOUSING 

purpose of carrying out activities under section 2474(a)(2) of this 

title, using funds appropriated or otherwise made available for that 

purpose in military construction accounts. 

(b) CREDITING OF FUNDS TO CAPITAL BUDGET.—Funds appropriated or otherwise made available in a fiscal year for the purpose 

of carrying out a military construction project with respect to a covered depot (as defined in subsection (e) of section 2476 of this title) 

may be credited to the amount required by subsection (a) of such 

section to be invested in the capital budgets of the covered depots 

in that fiscal year. 

(c) NOTICE AND WAIT REQUIREMENT.—When a decision is made 

to carry out a project under subsection (a), the Secretary of Defense 

shall notify in writing the appropriate committees of Congress of 

that decision and the savings estimated to be realized from the 

project. The project may then be carried out only after the end of 

the 21-day period beginning on the date the notification is received 

by such committees or, if earlier, the end of the 14-day period beginning on the date on which a copy of the notification is provided 

in an electronic medium pursuant to section 480 of this title. 

(d) ANNUAL REPORT.—Not later than December 31 of each 

year, the Secretary shall submit to Congress a report describing actions taken under this section and the savings realized from such 

actions during the fiscal year ending in the year in which the report is submitted. 

(Added Pub. L. 109–364, div. B, title XXVIII, Sec. 2809(a), Oct. 17, 2006, 120 Stat. 2470.) 

§ 2862. Turn-key selection procedures 

(a) AUTHORITY TO USE.—The Secretary concerned may use onestep turn-key selection procedures for the purpose of entering into 

contracts for the construction of authorized military construction 

projects. 

(b) DEFINITION.—In this section, the term ‘‘one-step turn-key 

selection procedures’’ means procedures used for the selection of a 

contractor on the basis of price and other evaluation criteria to perform, in accordance with the provisions of a firm fixed-price contract, both the design and construction of a facility using performance specifications supplied by the Secretary concerned. 

(Added Pub. L. 99–167, title VIII, Sec. 807(a), Dec. 3, 1985, 99 Stat. 988; amended Pub. L. 100– 

26, Sec. 7(k)(3), Apr. 21, 1987, 101 Stat. 284; Pub. L. 100–180, div. B, subdiv. 3, title I, Sec. 

2301, Dec. 4, 1987, 101 Stat. 1214; Pub. L. 101–189, div. B, title XXVIII, Sec. 2806, Nov. 29, 

1989, 103 Stat. 1647; Pub. L. 102–190, div. B, title XXVIII, Sec. 2802, Dec. 5, 1991, 105 Stat. 

1537.) 

§ 2863. Payment of contractor claims 

Notwithstanding any other provision of law, the Secretary concerned may pay meritorious contractor claims that arise under 

military construction contracts or family housing contracts. The 

Secretary of Defense, with respect to a Defense Agency, or the Secretary of a military department may use for such purpose any unobligated funds appropriated to such department and available for 

military construction or family housing construction, as the case 

may be. 

(Added Pub. L. 100–180, div. B, subdiv. 3, title I, Sec. 2303(a), Dec. 4, 1987, 101 Stat. 1215.) 
[§ 2864 CH. 169—MIL. CONSTRUCTION & MIL. FAMILY HOUSING 1646 

[§§ 2864, 2865. Repealed. Pub. L. 109–364, div. B, title XXVIII, 

Secs. 2810(a), 2851(a)(2), Oct. 17, 2006, 120 Stat. 

2470, 2494] 

§ 2866. Water conservation at military installations 

(a) WATER CONSERVATION ACTIVITIES.—(1) The Secretary of 

Defense shall permit and encourage each military department, Defense Agency, and other instrumentality of the Department of Defense to participate in programs conducted by a utility for the management of water demand or for water conservation. 

(2) The Secretary of Defense may authorize a military installation to accept a financial incentive (including an agreement to reduce the amount of a future water bill), goods, or services generally 

available from a utility, for the purpose of adopting technologies 

and practices that— 

(A) relate to the management of water demand or to water 

conservation; and 

(B) as determined by the Secretary, are cost effective for 

the Federal Government. 

(3) Subject to paragraph (4), the Secretary of Defense may authorize the Secretary of a military department having jurisdiction 

over a military installation to enter into an agreement with a utility to design and implement a cost-effective program that provides 

incentives for the management of water demand and for water conservation and that addresses the requirements and circumstances 

of the installation. Activities under the program may include the 

provision of water management services, the alteration of a facility, 

and the installation and maintenance by the utility of a watersaving device or technology. 

(4)(A) If an agreement under paragraph (3) provides for a utility to pay in advance the financing costs for the design or implementation of a program referred to in that paragraph and for such 

advance payment to be repayed by the United States, the cost of 

such advance payment may be recovered by the utility under terms 

that are not less favorable than the terms applicable to the most 

favored customer of the utility. 

(B) Subject to the availability of appropriations, a repayment 

of an advance payment under subparagraph (A) shall be made from 

funds available to a military department for the purchase of utility 

services. 

(C) An agreement under paragraph (3) shall provide that title 

to a water-saving device or technology installed at a military installation pursuant to the agreement shall vest in the United States. 

Such title may vest at such time during the term of the agreement, 

or upon expiration of the agreement, as determined to be in the 

best interests of the United States. 

(b) USE OF FINANCIAL INCENTIVES AND WATER COST SAVINGS.—(1) Financial incentives received from utilities for management of water demand or water conservation under subsection 

(a)(2) shall be credited to an appropriation designated by the Secretary of Defense. Amounts so credited shall be merged with the 

appropriation to which credited and shall be available for the same 

purposes and the same period as the appropriation with which 

merged. 
1647 § 2867 CH. 169—MIL. CONSTRUCTION & MIL. FAMILY HOUSING 

(2) Water cost savings realized under subsection (a)(3) shall be 

used as follows: 

(A) One-half of the amount shall be used for water conservation activities at such buildings, facilities, or installations 

of the Department of Defense as may be designated (in accordance with regulations prescribed by the Secretary of Defense) 

by the head of the department, agency, or instrumentality that 

realized the water cost savings. 

(B) One-half of the amount shall be used at the installation at which the savings were realized, as determined by the 

commanding officer of such installation consistent with applicable law and regulations, for— 

(i) improvements to existing military family housing 

units; 

(ii) any unspecified minor construction project that 

will enhance the quality of life of personnel; or 

(iii) any morale, welfare, or recreation facility or service. 

(3) The Secretary of Defense shall include in the budget material submitted to Congress in connection with the submission of the 

budget for a fiscal year pursuant to section 1105 of title 31 a separate statement of the amounts available for obligation under this 

subsection in that fiscal year. 

(c) WATER CONSERVATION CONSTRUCTION PROJECTS.—(1) The 

Secretary of Defense may carry out a military construction project 

for water conservation, not previously authorized, using funds appropriated or otherwise made available to the Secretary for water 

conservation. 

(2) When a decision is made to carry out a project under paragraph (1), the Secretary of Defense shall notify the appropriate 

committees of Congress of that decision. Such project may be carried out only after the end of the 21-day period beginning on the 

date the notification is received by such committees or, if earlier, 

the end of the 14-day period beginning on the date on which a copy 

of the notification is provided in an electronic medium pursuant to 

section 480 of this title. 

(Added Pub. L. 103–160, div. B, title XXVIII, Sec. 2803(a), Nov. 30, 1993, 107 Stat. 1884; Pub. 

L. 104–106, div. A, title XV, Sec. 1502(a)(27), Feb. 10, 1996, 110 Stat. 506; Pub. L. 105–85, div. 

B, title XXVIII, Sec. 2804(b), Nov. 18, 1997, 111 Stat. 1991; Pub. L. 108–136, div. A, title X, 

Sec. 1031(a)(48), Nov. 24, 2003, 117 Stat. 1602; Pub. L. 109–364, div. B, title XXVIII, Sec. 

2851(d), Oct. 17, 2006, 120 Stat. 2495.) 

§ 2867. Energy monitoring and utility control system specification for military construction and military family housing activities 

(a) ADOPTION OF DEPARTMENT-WIDE, OPEN PROTOCOL, ENERGY

MONITORING AND UTILITY CONTROL SYSTEM SPECIFICATION.—(1) 

The Secretary of Defense shall adopt an open protocol energy monitoring and utility control system specification for use throughout 

the Department of Defense in connection with a military construction project, military family housing activity, or other activity 

under this chapter for the purpose of monitoring and controlling, 

with respect to the project or activity, the items specified in paragraph (2) with the goal of establishing installation-wide energy 

monitoring and utility control systems. 
§ 2868 CH. 169—MIL. CONSTRUCTION & MIL. FAMILY HOUSING 1648 

(2) The energy monitoring and utility control system specification required by paragraph (1) shall cover the following: 

(A) Utilities and energy usage, including electricity, gas, 

steam, and water usage. 

(B) Indoor environments, including temperature and humidity levels. 

(C) Heating, ventilation, and cooling components. 

(D) Central plant equipment. 

(E) Renewable energy generation systems. 

(F) Lighting systems. 

(G) Power distribution networks. 

(b) EXCLUSION.—(1) The energy monitoring and utility control 

system specification required by subsection (a) is not required to 

apply to projects carried out under the authority provided in subchapter IV of chapter 169 of this title. 

(2) The Secretary concerned may waive the application of the 

energy monitoring and utility control system specification required 

by subsection (a) with respect to a specific military construction 

project, military family housing activity, or other activity under 

this chapter if the Secretary determines that the application of the 

specification to the project or activity is not life cycle cost-effective. 

The Secretary concerned shall notify the congressional defense 

committees of any waiver granted under this paragraph. 

(Added Pub. L. 111–84, div. B, title XXVIII, Sec. 2841(a)(1), Oct. 28, 2009, 123 Stat. 2679.) 

§ 2868. Utility services: furnishing for certain buildings 

Appropriations for the Department of Defense may be used for 

utility services for buildings constructed at private cost, as authorized by law. 

(Added Pub. L. 100–370, Sec. 1(j)(1), July 19, 1988, 102 Stat. 848, Sec. 2490; renumbered Sec. 

2868, Pub. L. 105–85, div. A, title III, Sec. 371(b)(2), Nov. 18, 1997, 111 Stat. 1705; Pub. L. 108– 

375, div. A, title VI, Sec. 651(e)(2), Oct. 28, 2004, 118 Stat. 1972.) 

§ 2869. Conveyance of property at military installations to 

limit encroachment 

(a) CONVEYANCE AUTHORIZED; CONSIDERATION.—(1) The Secretary concerned may enter into an agreement to convey real property, including any improvements thereon, described in paragraph 

(2) to any person who agrees, in exchange for the real property, to 

carry out a land acquisition, including the acquisition of all right, 

title, and interest or a lesser interest in real property under an 

agreement entered into under section 2684a of this title to limit encroachments and other constraints on military training, testing, 

and operations. 

(2) Paragraph (1) applies with respect to real property under 

the jurisdiction of the Secretary concerned that— 

(A) is located on a military installation that is closed or realigned under a base closure law; or 

(B) is located on a military installation not covered by subparagraph (A) and is determined to be excess to the needs of 

the Department of Defense. 

(b) CONDITIONS ON CONVEYANCE AUTHORITY.—The fair market 

value of the land to be obtained by the Secretary concerned under 

subsection (a) in exchange for the conveyance of real property by 
1649 § 2869 CH. 169—MIL. CONSTRUCTION & MIL. FAMILY HOUSING 

the Secretary under such subsection shall be at least equal to the 

fair market value of the conveyed real property, as determined by 

the Secretary. If the fair market value of the land is less than the 

fair market value of the real property to be conveyed, the recipient 

of the property shall pay to the United States an amount equal to 

the difference in the fair market values. 

(c) LIMITATION ON USE OF CONVEYANCE AUTHORITY AT INSTAL- LATIONS CLOSED UNDER BASE CLOSURE LAWS.—The authority 

under subsection (a)(2)(A) to convey property located on a military 

installation may only be used to the extent the conveyance is consistent with an approved redevelopment plan for such installation. 

(d) ADVANCE NOTICE OF USE OF AUTHORITY.—(1) Notice of the 

proposed use of the conveyance authority provided by subsection (a) 

shall be provided in such manner as the Secretary of Defense may 

prescribe, including publication in the Federal Register and otherwise. When real property located at a military installation is proposed for conveyance by means of a public sale, the Secretary concerned may notify prospective purchasers that consideration for the 

property may be provided in the manner authorized by such subsection. 

(2) The Secretary concerned may not enter into an agreement 

under subsection (a) for the conveyance of real property until— 

(A) the Secretary submits to Congress notice of the conveyance, including— 

(i) a description of the real property to be conveyed by 

the Secretary under the agreement; 

(ii) a description of the land acquisition to be carried 

out under the agreement in exchange for the conveyance 

of the property; and 

(iii) the amount of any payment to be made under subsection (b) or under section 2684a(d) of this title to equalize the fair market values of the property to be conveyed 

and the land acquisition to be carried out under the agreement in exchange for the conveyance of the property; and 

(B) the waiting period applicable to that notice under paragraph (3) expires. 

(3) If the notice submitted under paragraph (2) deals with the 

conveyance of real property located on a military installation that 

is closed or realigned under a base closure law or the conveyance 

of real property under an agreement entered into under section 

2684a of this title, the Secretary concerned may enter into the 

agreement under subsection (a) for the conveyance of the property 

after a period of 21 days has elapsed from the date of receipt of 

the notice or, if over sooner, a period of 14 days has elapsed from 

the date on which a copy of the notice is provided in an electronic 

medium pursuant to section 480 of this title. In the case of other 

real property to be conveyed under subsection (a), the Secretary 

concerned may enter into the agreement only after a period of 60 

days has elapsed from the date of receipt of the notice or, if over 

sooner, a period of 45 days has elapsed from the date on which the 

electronic copy is provided. 

(e) DEPOSIT AND USE OF FUNDS.—The Secretary concerned 

shall deposit funds received under subsection (b) in the appropriation ‘‘Foreign Currency Fluctuations, Construction, Defense’’. The 
§ 2871 CH. 169—MIL. CONSTRUCTION & MIL. FAMILY HOUSING 1650 

funds deposited shall be available, in such amounts as provided in 

appropriation Acts, for the purpose of paying increased costs of 

overseas military construction and family housing construction or 

improvement associated with unfavorable fluctuations in currency 

exchange rates. The use of such funds for this purpose does not relieve the Secretary concerned from the duty to provide advance notice to Congress under section 2853(c) of this title whenever the 

Secretary approves an increase in the cost of an overseas project 

under such section. 

(f) SUNSET.—The authority to enter into an agreement under 

this section shall expire on September 30, 2013. 

(g) DESCRIPTION OF PROPERTY.—The exact acreage and legal 

description of real property conveyed under subsection (a) shall be 

determined by surveys satisfactory to the Secretary concerned. 

(h) ADDITIONAL TERMS AND CONDITIONS.—The Secretary concerned may require such additional terms and conditions in connection with a conveyance under subsection (a) as the Secretary considers appropriate to protect the interests of the United States. 

(Added Pub. L. 108–136, div. B, title XXVIII, Sec. 2805(a)(1), Nov. 24, 2003, 117 Stat. 1719; 

amended Pub. L. 109–364, div. B, title XXVIII, Sec. 2811(a)–(f)(1), Oct. 17, 2006, 120 Stat. 2471– 

2473; Pub. L. 111–84, div. B, title XXVIII, Sec. 2804(a)–(d)(1), Oct. 28, 2009, 123 Stat. 2661, 

2662.) 

SUBCHAPTER IV—ALTERNATIVE AUTHORITY FOR 

ACQUISITION AND IMPROVEMENT OF MILITARY HOUSING 

Sec. 

2871. Definitions. 

2872. General authority. 

2872a. Utilities and services. 

2873. Direct loans and loan guarantees. 

2874. Leasing of housing. 

2875. Investments. 

2876. Rental guarantees. 

2877. Differential lease payments. 

2878. Conveyance or lease of existing property and facilities. 

[2879. Repealed.] 

2880. Unit size and type. 

2881. Ancillary supporting facilities. 

2881a. Pilot projects for acquisition or construction of military unaccompanied 

housing. 

2882. Effect of assignment of members to housing units acquired or constructed 

under alternative authority. 

2883. Department of Defense Housing Funds. 

2883a. Funds for housing allowances of members of the armed forces assigned to 

certain military family housing units. 

2884. Reports. 

2885. Oversight and accountability for privatization projects. 

§ 2871. Definitions 

In this subchapter: 

(1) The term ‘‘ancillary supporting facilities’’ means facilities related to military housing units, including facilities to 

provide or support elementary or secondary education, child 

care centers, day care centers, child development centers, tot 

lots, community centers, housing offices, dining facilities, unit 

offices, and other similar facilities for the support of military 

housing. 
1651 § 2872a CH. 169—MIL. CONSTRUCTION & MIL. FAMILY HOUSING 

(2) The term ‘‘child development center’’ includes a facility, 

and the utilities to support such facility, the function of which 

is to support the daily care of children aged six weeks old 

through five years old for full-day, part-day, and hourly service. 

(3) The term ‘‘construction’’ means the construction of military housing units and ancillary supporting facilities or the improvement or rehabilitation of existing units or ancillary supporting facilities. 

(4) The term ‘‘contract’’ includes any contract, lease, or 

other agreement entered into under the authority of this subchapter. 

(5) The term ‘‘eligible entity’’ means any private person, 

corporation, firm, partnership, company, State or local government, or housing authority of a State or local government that 

is prepared to enter into a contract as a partner with the Secretary concerned for the construction of military housing units 

and ancillary supporting facilities. 

(6) The term ‘‘Fund’’ means the Department of Defense 

Family Housing Improvement Fund or the Department of Defense Military Unaccompanied Housing Improvement Fund established under section 2883(a) of this title. 

(7) The term ‘‘military unaccompanied housing’’ means 

military housing intended to be occupied by members of the 

armed forces serving a tour of duty unaccompanied by dependents and transient housing intended to be occupied by members of the armed forces on temporary duty. 

(8) The term ‘‘United States’’ includes the Commonwealth 

of Puerto Rico. 

(Added Pub. L. 104–106, div. B, title XXVIII, Sec. 2801(a)(1), Feb. 10, 1996, 110 Stat. 544; Pub. 

L. 105–271, div. B, title XXVIII, Sec. 2803, Oct. 17, 1998, 112 Stat. 2202; Pub. L. 106–65, div. 

B, title XXVIII, Sec. 2803(a), Oct. 5, 1999, 113 Stat. 848; Pub. L. 107–314, div. B, title XXVIII, 

Sec. 2803(b), Dec. 2, 2002, 116 Stat. 2705; Pub. L. 108–136, div. A, title X, Sec. 1043(c)(6), Nov. 

24, 2003, 117 Stat. 1612; Pub. L. 109–163, div. B, title XXVIII, Sec. 2805(b), Jan. 6, 2006, 119 

Stat. 3507; Pub. L. 110–417, div. B, title XXVIII, Sec. 2805(c), Oct. 14, 2008, 122 Stat. 4723.) 

§ 2872. General authority 

In addition to any other authority provided under this chapter 

for the acquisition or construction of military family housing or 

military unaccompanied housing, the Secretary concerned may exercise any authority or any combination of authorities provided 

under this subchapter in order to provide for the acquisition or construction by eligible entities of the following: 

(1) Family housing units on or near military installations 

within the United States and its territories and possessions. 

(2) Military unaccompanied housing units on or near such 

military installations. 

(Added Pub. L. 104–106, div. B, title XXVIII, Sec. 2801(a)(1), Feb. 10, 1996, 110 Stat. 545; 

amended Pub. L. 106–65, div. B, title XXVIII, Sec. 2803(b), Oct. 5, 1999, 113 Stat. 849.) 

§ 2872a. Utilities and services 

(a) AUTHORITY TO FURNISH.—The Secretary concerned may 

furnish utilities and services referred to in subsection (b) in connection with any military housing acquired or constructed pursuant to 

the exercise of any authority or combination of authorities under 
§ 2873 CH. 169—MIL. CONSTRUCTION & MIL. FAMILY HOUSING 1652 

this subchapter if the military housing is located on a military installation. 

(b) COVERED UTILITIES AND SERVICES.—The utilities and services that may be furnished under subsection (a) are the following: 

(1) Electric power. 

(2) Steam. 

(3) Compressed air. 

(4) Water. 

(5) Sewage and garbage disposal. 

(6) Natural gas. 

(7) Pest control. 

(8) Snow and ice removal. 

(9) Mechanical refrigeration. 

(10) Telecommunications service. 

(11) Firefighting and fire protection services. 

(12) Police protection services. 

(c) REIMBURSEMENT.—(1) The Secretary concerned shall be reimbursed for any utilities or services furnished under subsection 

(a). 

(2) The amount of any cash payment received under paragraph 

(1) shall be credited to the appropriation or working capital account 

from which the cost of furnishing the utilities or services concerned 

was paid. Amounts so credited to an appropriation or account shall 

be merged with funds in such appropriation or account, and shall 

be available to the same extent, and subject to the same terms and 

conditions, as such funds. 

(Added Pub. L. 106–398, Sec. 1 [div. B, title XXVIII, Sec. 2805(a)], Oct. 30, 2000, 114 Stat. 1654, 

1654A–414; amended Pub. L. 107–314, div. B, title XXVIII, Sec. 2802(a), Dec. 2, 2002, 116 Stat. 

2703.) 

§ 2873. Direct loans and loan guarantees 

(a) DIRECT LOANS.—(1) Subject to subsection (c), the Secretary 

concerned may make direct loans to an eligible entity in order to 

provide funds to the eligible entity for the acquisition or construction of housing units that the Secretary determines are suitable for 

use as military family housing or as military unaccompanied housing. 

(2) The Secretary concerned shall establish such terms and 

conditions with respect to loans made under this subsection as the 

Secretary considers appropriate to protect the interests of the 

United States, including the period and frequency for repayment of 

such loans and the obligations of the obligors on such loans upon 

default. 

(b) LOAN GUARANTEES.—(1) Subject to subsection (c), the Secretary concerned may guarantee a loan made to an eligible entity 

if the proceeds of the loan are to be used by the eligible entity to 

acquire, or construct housing units that the Secretary determines 

are suitable for use as military family housing or as military unaccompanied housing. 

(2) The amount of a guarantee on a loan that may be provided 

under paragraph (1) may not exceed the amount equal to the lesser 

of— 

(A) the amount equal to 80 percent of the value of the 

project; or 
1653 § 2875 CH. 169—MIL. CONSTRUCTION & MIL. FAMILY HOUSING 

(B) the amount of the outstanding principal of the loan. 

(3) The Secretary concerned shall establish such terms and 

conditions with respect to guarantees of loans under this subsection 

as the Secretary considers appropriate to protect the interests of 

the United States, including the rights and obligations of obligors 

of such loans and the rights and obligations of the United States 

with respect to such guarantees. 

(c) LIMITATION ON DIRECT LOAN AND GUARANTEE AUTHORITY.— 

Direct loans and loan guarantees may be made under this section 

only to the extent that appropriations of budget authority to cover 

their cost (as defined in section 502(5) of the Federal Credit Reform 

Act of 1990 (2 U.S.C. 661a(5))) are made in advance, or authority 

is otherwise provided in appropriation Acts. If such appropriation 

or other authority is provided, there may be established a financing 

account (as defined in section 502(7) of such Act (2 U.S.C. 661a(7))), 

which shall be available for the disbursement of direct loans or 

payment of claims for payment on loan guarantees under this section and for all other cash flows to and from the Government as 

a result of direct loans and guarantees made under this section. 

(Added Pub. L. 104–106, div. B, title XXVIII, Sec. 2801(a)(1), Feb. 10, 1996, 110 Stat. 545; 

amended Pub. L. 106–65, div. B, title XXVIII, Sec. 2803(c), Oct. 5, 1999, 113 Stat. 849.) 

§ 2874. Leasing of housing 

(a) LEASE AUTHORIZED.—The Secretary concerned may enter 

into contracts for the lease of housing units that the Secretary determines are suitable for use as military family housing or military 

unaccompanied housing. 

(b) USE OF LEASED UNITS.—The Secretary concerned shall utilize housing units leased under this section as military family 

housing or military unaccompanied housing, as appropriate. 

(c) LEASE TERMS.—A contract under this section may be for 

any period that the Secretary concerned determines appropriate 

and may provide for the owner of the leased property to operate 

and maintain the property. 

(Added Pub. L. 104–106, div. B, title XXVIII, Sec. 2801(a)(1), Feb. 10, 1996, 110 Stat. 546; 

amended Pub. L. 107–314, div. B, title XXVIII, Sec. 2802(b)(1), (2), Dec. 2, 2002, 116 Stat. 2703.) 

§ 2875. Investments 

(a) INVESTMENTS AUTHORIZED.—The Secretary concerned may 

make investments in an eligible entity carrying out projects for the 

acquisition or construction of housing units suitable for use as military family housing or as military unaccompanied housing. 

(b) FORMS OF INVESTMENT.—An investment under this section 

may take the form of an acquisition of a limited partnership interest by the United States, a purchase of stock or other equity instruments by the United States, a purchase of bonds or other debt instruments by the United States, or any combination of such forms 

of investment. 

(c) LIMITATION ON VALUE OF INVESTMENT.—(1) The cash 

amount of an investment under this section in an eligible entity 

may not exceed an amount equal to 331⁄3 percent of the capital cost 

(as determined by the Secretary concerned) of the project or 

projects that the eligible entity proposes to carry out under this 

section with the investment. 
§ 2876 CH. 169—MIL. CONSTRUCTION & MIL. FAMILY HOUSING 1654 

(2) If the Secretary concerned conveys land or facilities to an 

eligible entity as all or part of an investment in the entity under 

this section, the total value of the investment by the Secretary 

under this section may not exceed an amount equal to 45 percent 

of the capital cost (as determined by the Secretary) of the project 

or projects that the eligible entity proposes to carry out under this 

section with the investment. 

(3) In this subsection, the term ‘‘capital cost’’, with respect to 

a project for the acquisition or construction of housing, means the 

total amount of the costs included in the basis of the housing for 

Federal income tax purposes. 

(d) COLLATERAL INCENTIVE AGREEMENTS.—The Secretary concerned shall enter into collateral incentive agreements with eligible 

entities in which the Secretary makes an investment under this 

section to ensure that a suitable preference will be afforded members of the armed forces and their dependents in the lease or purchase, as the case may be, of a reasonable number of the housing 

units covered by the investment. 

(e) CONGRESSIONAL NOTIFICATION REQUIRED.—Amounts in the 

Department of Defense Family Housing Improvement Fund or the 

Department of Defense Military Unaccompanied Housing Improvement Fund may be used to make a cash investment under this section in an eligible entity only after the end of the 30-day period beginning on the date the Secretary of Defense submits written notice 

of, and justification for, the investment to the appropriate committees of Congress or, if earlier, the end of the 14-day period beginning on the date on which a copy of the notice and justification is 

provided in an electronic medium pursuant to section 480 of this 

title. 

(Added Pub. L. 104–106, div. B, title XXVIII, Sec. 2801(a)(1), Feb. 10, 1996, 110 Stat. 546; 

amended Pub. L. 105–85, div. B, title XXVIII, Sec. 2805, Nov. 18, 1997, 111 Stat. 1991; Pub. 

L. 106–65, div. B, title XXVIII, Sec. 2803(d), (h)(1), Oct. 5, 1999, 113 Stat. 849; Pub. L. 108– 

136, div. A, title X, Sec. 1031(a)(50), Nov. 24, 2003, 117 Stat. 1602.) 

§ 2876. Rental guarantees 

The Secretary concerned may enter into agreements with eligible entities that acquire or construct military family housing units 

or military unaccompanied housing units under this subchapter in 

order to assure— 

(1) the occupancy of such units at levels specified in the 

agreements; or 

(2) rental income derived from rental of such units at levels specified in the agreements. 

(Added Pub. L. 104–106, div. B, title XXVIII, Sec. 2801(a)(1), Feb. 10, 1996, 110 Stat. 546; 

amended Pub. L. 106–65, div. B, title XXVIII, Sec. 2803(e), Oct. 5, 1999, 113 Stat. 849.) 

§ 2877. Differential lease payments 

Pursuant to an agreement entered into by the Secretary concerned and a lessor of military family housing or military unaccompanied housing to members of the armed forces, the Secretary may 

pay the lessor an amount in addition to the rental payments for the 

housing made by the members as the Secretary determines appropriate to encourage the lessor to make the housing available to 

members of the armed forces as military family housing or as military unaccompanied housing. 
1655 § 2880 CH. 169—MIL. CONSTRUCTION & MIL. FAMILY HOUSING 

(Added Pub. L. 104–106, div. B, title XXVIII, Sec. 2801(a)(1), Feb. 10, 1996, 110 Stat. 547; 

amended Pub. L. 106–65, div. B, title XXVIII, Sec. 2803(f), Oct. 5, 1999, 113 Stat. 849.) 

§ 2878. Conveyance or lease of existing property and facilities 

(a) CONVEYANCE OR LEASE AUTHORIZED.—The Secretary concerned may convey or lease property or facilities (including ancillary supporting facilities) to eligible entities for purposes of using 

the proceeds of such conveyance or lease to carry out activities 

under this subchapter. 

(b) INAPPLICABILITY TO PROPERTY AT INSTALLATION APPROVED

FOR CLOSURE.—The authority of this section does not apply to 

property or facilities located on or near a military installation approved for closure under a base closure law. 

(c) COMPETITIVE PROCESS.—The Secretary concerned shall ensure that the time, method, and terms and conditions of the reconveyance or lease of property or facilities under this section from 

the eligible entity permit full and free competition consistent with 

the value and nature of the property or facilities involved. 

(d) TERMS AND CONDITIONS.—(1) The conveyance or lease of 

property or facilities under this section shall be for such consideration and upon such terms and conditions as the Secretary concerned considers appropriate for the purposes of this subchapter 

and to protect the interests of the United States. 

(2) As part or all of the consideration for a conveyance or lease 

under this section, the purchaser or lessor (as the case may be) 

shall enter into an agreement with the Secretary to ensure that a 

suitable preference will be afforded members of the armed forces 

and their dependents in the lease or sublease of a reasonable number of the housing units covered by the conveyance or lease, as the 

case may be, or in the lease of other suitable housing units made 

available by the purchaser or lessee. 

(e) INAPPLICABILITY OF CERTAIN PROPERTY MANAGEMENT

LAWS.—The conveyance or lease of property or facilities under this 

section shall not be subject to the following provisions of law: 

(1) Section 2667 of this title. 

(2) Subtitle I of title 40 and division C (except sections 

3302, 3501(b), 3509, 3906, 4710, and 4711) of subtitle I of title 

41. 

(3) Section 1302 of title 40. 

(4) Section 501 of the McKinney-Vento Homeless Assistance Act (42 U.S.C. 11411). 

(Added Pub. L. 104–106, div. B, title XXVIII, Sec. 2801(a)(1), Feb. 10, 1996, 110 Stat. 547; 

amended Pub. L. 105–85, div. A, title X, Sec. 1073(a)(60), Nov. 18, 1997, 111 Stat. 1903; Pub. 

L. 106–65, div. B, title XXVIII, Sec. 2803(g), Oct. 5, 1999, 113 Stat. 849; Pub. L. 107–107, div. 

A, title X, Sec. 1048(d)(1), Dec. 28, 2001, 115 Stat. 1227; Pub. L. 107–217, Sec. 3(b)(23), Aug. 

21, 2002, 116 Stat. 1297; Pub. L. 110–417, div. B, title XXVIII, Sec. 2805(d), Oct. 14, 2008, 122 

Stat. 4723; Pub. L. 111–350, Sec. 5(b)(50), Jan. 4, 2011, 124 Stat. 3846.) 

[§ 2879. Repealed. Pub. L. 107–314, div. B, title XXVIII, Sec. 

2802(c)(1), Dec. 2, 2002, 116 Stat. 2703] 

§ 2880. Unit size and type 

(a) CONFORMITY WITH SIMILAR HOUSING UNITS IN LOCALE.— 

The Secretary concerned shall ensure that the room patterns and 

floor areas of military family housing units and military unaccom-
§ 2881 CH. 169—MIL. CONSTRUCTION & MIL. FAMILY HOUSING 1656 

panied housing units acquired or constructed under this subchapter 

are generally comparable to the room patterns and floor areas of 

similar housing units in the locality concerned. 

(b) INAPPLICABILITY OF LIMITATIONS ON SPACE BY PAY

GRADE.—Sections 2826 and 2856 of this title shall not apply to 

military family housing or military unaccompanied housing units 

acquired or constructed under this subchapter. 

(Added Pub. L. 104–106, div. B, title XXVIII, Sec. 2801(A)(1), Feb. 10, 1996, 110 Stat. 548; 

amended Pub. L. 108–136, div. B, title XXVIII, Sec. 2806, Nov. 24, 2003, 117 Stat. 1722; Pub. 

L. 109–364, div. B, title XXVIII, Sec. 2807(b), Oct. 17, 2006, 120 Stat. 2469.) 

§ 2881. Ancillary supporting facilities 

(a) AUTHORITY TO ACQUIRE OR CONSTRUCT.—Any project for 

the acquisition or construction of military family housing units or 

military unaccompanied housing units under this subchapter may 

include the acquisition or construction of ancillary supporting facilities for the housing units concerned. 

(b) RESTRICTION.—A project referred to in subsection (a) may 

not include the acquisition or construction of an ancillary supporting facility (other than a child development center) if, as determined by the Secretary concerned, the facility is to be used for providing merchandise or services in direct competition with— 

(1) the Army and Air Force Exchange Service; 

(2) the Navy Exchange Service Command; 

(3) a Marine Corps exchange; 

(4) the Defense Commissary Agency; or 

(5) any nonappropriated fund activity of the Department of 

Defense for the morale, welfare, and recreation of members of 

the armed forces. 

(Added Pub. L. 104–106, div. B, title XXVIII, Sec. 2801(a)(1), Feb. 10, 1996, 110 Stat. 548; 

amended Pub. L. 106–65, div. B, title XXVIII, Sec. 2804, Oct. 5, 1999, 113 Stat. 849; Pub. L. 

109–163, div. B, title XXVIII, Sec. 2805(a), Jan. 6, 2006, 119 Stat. 3507.) 

§ 2881a. Pilot projects for acquisition or construction of 

military unaccompanied housing 

(a) PILOT PROJECTS AUTHORIZED.—The Secretary of the Navy 

may carry out not more than three pilot projects under the authority of this section or another provision of this subchapter to use the 

private sector for the acquisition or construction of military unaccompanied housing in the United States, including any territory or 

possession of the United States. 

(b) TREATMENT OF HOUSING; ASSIGNMENT OF MEMBERS.—The 

Secretary of the Navy may assign members of the armed forces 

without dependents to housing units acquired or constructed under 

the pilot projects, and such housing units shall be considered as 

quarters of the United States or a housing facility under the jurisdiction of the Secretary for purposes of section 403 of title 37. 

(c) BASIC ALLOWANCE FOR HOUSING.—(1) The Secretary of Defense may prescribe and, under section 403(n) of title 37, pay for 

members of the armed forces without dependents in privatized 

housing acquired or constructed under the pilot projects higher 

rates of partial basic allowance for housing than the rates authorized under paragraph (2) of such section. 

(2) The partial basic allowance for housing paid for a member 

at a higher rate under this subsection may be paid directly to the 
1657 § 2882 CH. 169—MIL. CONSTRUCTION & MIL. FAMILY HOUSING 

private sector source of the housing to whom the member is obligated to pay rent or other charge for residing in such housing if 

the private sector source credits the amount so paid against the 

amount owed by the member for the rent or other charge. 

(d) FUNDING.—(1) The Secretary of the Navy shall use the Department of Defense Military Unaccompanied Housing Improvement Fund to carry out activities under the pilot projects. 

(2) Subject to 30 days prior notification to the appropriate committees of Congress, such additional amounts as the Secretary of 

Defense considers necessary may be transferred to the Department 

of Defense Military Unaccompanied Housing Improvement Fund 

from amounts appropriated for construction of military unaccompanied housing in military construction accounts. The amounts so 

transferred shall be merged with and be available for the same 

purposes and for the same period of time as amounts appropriated 

directly to the Fund. 

(e) REPORTS.—(1) The Secretary of the Navy shall transmit to 

the appropriate committees of Congress a report describing— 

(A) each contract for the acquisition of military unaccompanied housing that the Secretary proposes to solicit under the 

pilot projects; 

(B) each conveyance or lease proposed under section 2878 

of this title in furtherance of the pilot projects; and 

(C) the proposed partial basic allowance for housing rates 

for each contract as they vary by grade of the member and how 

they compare to basic allowance for housing rates for other 

contracts written under the authority of the pilot programs. 

(2) The report shall describe the proposed contract, conveyance, 

or lease and the intended method of participation of the United 

States in the contract, conveyance, or lease and provide a justification of such method of participation. The report shall be submitted 

not later than 30 days before the date on which the Secretary 

issues the contract solicitation or offers the conveyance or lease or, 

if earlier, a period of 20 days has elapsed from the date on which 

a copy of the report is provided in an electronic medium pursuant 

to section 480 of this title. 

(f) EXPIRATION.—The authority of the Secretary of the Navy to 

enter into a contract under the pilot programs shall expire September 30, 2009. 

(Added Pub. L. 107–314, div. B, title XXVIII, Sec. 2803(a)(1), Dec. 2, 2002, 116 Stat. 2703; 

amended Pub. L. 109–163, div. A, title X, Sec. 1056(c)(10), Jan. 6, 2006, 119 Stat. 3440; Pub. 

L. 109–364, div. B, title XXVIII, Sec. 2812, Oct. 17, 2006, 120 Stat. 2473; Pub. L. 111–383, div. 

B, title XXVIII, Sec. 2803(f), Jan. 7, 2011, 124 Stat. 4459.) 

§ 2882. Effect of assignment of members to housing units acquired or constructed under alternative authority 

(a) TREATMENT AS QUARTERS OF THE UNITED STATES.—Except 

as provided in subsection (b), housing units acquired or constructed 

under this subchapter shall be considered as quarters of the United 

States or a housing facility under the jurisdiction of a uniformed 

service for purposes of section 403 of title 37. 

(b) AVAILABILITY OF BASIC ALLOWANCE FOR HOUSING.—A member of the armed forces who is assigned to a housing unit acquired 

or constructed under this subchapter that is not owned or leased 
§ 2883 CH. 169—MIL. CONSTRUCTION & MIL. FAMILY HOUSING 1658 

by the United States shall be entitled to a basic allowance for housing under section 403 of title 37. 

(c) LEASE PAYMENTS THROUGH PAY ALLOTMENTS.—The Secretary concerned may require members of the armed forces who 

lease housing in housing units acquired or constructed under this 

subchapter to make lease payments for such housing pursuant to 

allotments of the pay of such members under section 701 of title 

37. 

(Added Pub. L. 104–106, div. B, title XXVIII, Sec. 2801(a)(1), Feb. 10, 1996, 110 Stat. 548; 

amended Pub. L. 105–85, div. A, title VI, Sec. 603(d)(2)(C), Nov. 18, 1997, 111 Stat. 1783; Pub. 

L. 110–417, div. B, title XXVIII, Sec. 2805(e)(1), Oct. 14, 2008, 122 Stat. 4723.) 

§ 2883. Department of Defense Housing Funds 

(a) ESTABLISHMENT.—There are hereby established on the 

books of the Treasury the following accounts: 

(1) The Department of Defense Family Housing Improvement Fund. 

(2) The Department of Defense Military Unaccompanied 

Housing Improvement Fund. 

(b) COMMINGLING OF FUNDS PROHIBITED.—(1) The Secretary of 

Defense shall administer each Fund separately. 

(2) Amounts in the Department of Defense Family Housing Improvement Fund may be used only to carry out activities under this 

subchapter with respect to military family housing. 

(3) Amounts in the Department of Defense Military Unaccompanied Housing Improvement Fund may be used only to carry out 

activities under this subchapter with respect to military unaccompanied housing. 

(c) CREDITS TO FUNDS.—(1) There shall be credited to the Department of Defense Family Housing Improvement Fund the following: 

(A) Amounts authorized for and appropriated to that Fund. 

(B) Subject to subsection (f), any amounts that the Secretary of Defense transfers, in such amounts as provided in appropriation Acts, to that Fund from amounts authorized and 

appropriated to the Department of Defense for the acquisition, 

improvement, or construction of military family housing. 

(C) Proceeds from the conveyance or lease of property or 

facilities under section 2878 of this title for the purpose of carrying out activities under this subchapter with respect to military family housing. 

(D) Income derived from any activities under this subchapter with respect to military family housing, including interest on loans made under section 2873 of this title, income 

and gains realized from investments under section 2875 of this 

title, and any return of capital invested as part of such investments. 

(E) Any amounts that the Secretary of the Navy transfers 

to that Fund pursuant to section 2814(i)(3) of this title, subject 

to the restrictions on the use of the transferred amounts specified in that section. 

(F) Any amounts that the Secretary concerned transfers to 

that Fund pursuant to section 2869 of this title. 
1659 § 2883 CH. 169—MIL. CONSTRUCTION & MIL. FAMILY HOUSING 

(G) Subject to subsection (f), any amounts that the Secretary of Defense transfers to that Fund from amounts in the 

Department of Defense Base Closure Account 2005. 

(2) There shall be credited to the Department of Defense Military Unaccompanied Housing Improvement Fund the following: 

(A) Amounts authorized for and appropriated to that Fund. 

(B) Subject to subsection (f), any amounts that the Secretary of Defense transfers, in such amounts as provided in appropriation Acts, to that Fund from amounts authorized and 

appropriated to the Department of Defense for the acquisition 

or construction of military unaccompanied housing. 

(C) Proceeds from the conveyance or lease of property or 

facilities under section 2878 of this title for the purpose of carrying out activities under this subchapter with respect to military unaccompanied housing. 

(D) Income derived from any activities under this subchapter with respect to military unaccompanied housing, including interest on loans made under section 2873 of this title, 

income and gains realized from investments under section 

2875 of this title, and any return of capital invested as part of 

such investments. 

(E) Any amounts that the Secretary of the Navy transfers 

to that Fund pursuant to section 2814(i)(3) of this title, subject 

to the restrictions on the use of the transferred amounts specified in that section. 

(F) Any amounts that the Secretary concerned transfers to 

that Fund pursuant to section 2869 of this title. 

(G) Subject to subsection (f), any amounts that the Secretary of Defense transfers to that Fund from amounts in the 

Department of Defense Base Closure Account 2005. 

(d) USE OF AMOUNTS IN FUNDS.—(1) In such amounts as provided in appropriation Acts and except as provided in subsection 

(e), the Secretary of Defense may use amounts in the Department 

of Defense Family Housing Improvement Fund to carry out activities under this subchapter with respect to military family housing, 

including activities required in connection with the planning, execution, and administration of contracts entered into under the authority of this subchapter. The Secretary may also use for expenses 

of activities required in connection with the planning, execution, 

and administration of such contracts funds that are otherwise 

available to the Department of Defense for such types of expenses. 

(2) In such amounts as provided in appropriation Acts and except as provided in subsection (e), the Secretary of Defense may 

use amounts in the Department of Defense Military Unaccompanied Housing Improvement Fund to carry out activities under 

this subchapter with respect to military unaccompanied housing, 

including activities required in connection with the planning, execution, and administration of contracts entered into under the authority of this subchapter. The Secretary may also use for expenses 

of activities required in connection with the planning, execution, 

and administration of such contracts funds that are otherwise 

available to the Department of Defense for such types of expenses. 

(3) Amounts made available under this subsection shall remain 

available until expended. The Secretary of Defense may transfer 
§ 2883a CH. 169—MIL. CONSTRUCTION & MIL. FAMILY HOUSING 1660 

amounts made available under this subsection to the Secretaries of 

the military departments to permit such Secretaries to carry out 

the activities for which such amounts may be used. 

(e) LIMITATION ON OBLIGATIONS.—(1) The Secretary may not 

incur an obligation under a contract or other agreement entered 

into under this subchapter in excess of the unobligated balance, at 

the time the contract is entered into, of the Fund required to be 

used to satisfy the obligation. 

(2) The Funds established under subsection (a) shall be the 

sole source of funds for activities carried out under this subchapter. 

(f) NOTIFICATION REQUIRED FOR TRANSFERS.—A transfer of appropriated amounts to a Fund under subparagraph (B) or (G) of 

paragraph (1) or subparagraph (B) or (G) of paragraph (2) of subsection (c) may be made only after the end of the 30-day period beginning on the date the Secretary of Defense submits written notice 

of, and justification for, the transfer to the appropriate committees 

of Congress or, if earlier, the end of the 14-day period beginning 

on the date on which a copy of the notice and justification is provided in an electronic medium pursuant to section 480 of this title. 

In addition, the notice required in connection with a transfer under 

subparagraph (G) of paragraph (1) or subparagraph (G) of paragraph (2) shall include a certification that the amounts to be transferred from the Department of Defense Base Closure Account 2005 

were specified in the conference report to accompany the most recent Military Construction Authorization Act. 

(Added Pub. L. 104–106, div. B, title XXVIII, Sec. 2801(a)(1), Feb. 10, 1996, 110 Stat. 548; 

amended Pub. L. 104–201, div. B, title XXVIII, Sec. 2804, Sept. 23, 1996, 110 Stat. 2788; Pub. 

L. 106–65, div. B, title XXVIII, Sec. 2802(b), Oct. 5, 1999, 113 Stat. 848; Pub. L. 108–136, div. 

A, title X, Sec. 1031(a)(51), div. B, title XXVIII, Sec. 2805(c), Nov. 24, 2003, 117 Stat. 1603, 

1721; Pub. L. 108–375, div. B, title XXVIII, Sec. 2805(a), Oct. 28, 2004, 118 Stat. 2122; Pub. 

L. 109–163, div. B, title XXVIII, Sec. 2806(a), (b), Jan. 6, 2006, 119 Stat. 3507; Pub. L. 110– 

181, div. B, title XXVII, Sec. 2705, Jan. 28, 2008, 122 Stat. 533.) 

§ 2883a. Funds for housing allowances of members of the 

armed forces assigned to certain military family 

housing units 

(a) AUTHORITY TO TRANSFER FUNDS TO COVER HOUSING ALLOWANCES.—During the fiscal year in which a contract is awarded 

for the acquisition or construction of military family housing units 

under this subchapter that are not to be owned by the United 

States, the Secretary of Defense may transfer the amount determined under subsection (b) with respect to such housing from appropriations available for support of military housing for the armed 

force concerned for that fiscal year to appropriations available for 

pay and allowances of military personnel of that same armed force 

for that same fiscal year. 

(b) AMOUNT TRANSFERRED.—The total amount authorized to be 

transferred under subsection (a) in connection with a contract 

under this subchapter may not exceed an amount equal to any additional amounts payable during the fiscal year in which the contract is awarded to members of the armed forces assigned to the 

acquired or constructed housing units as basic allowance for housing under section 403 of title 37 that would not otherwise have 

been payable to such members if not for assignment to such housing units. 
1661 § 2884 CH. 169—MIL. CONSTRUCTION & MIL. FAMILY HOUSING 

(c) TRANSFERS SUBJECT TO APPROPRIATIONS.—The transfer of 

funds under the authority of subsection (a) is limited to such 

amounts as may be provided in advance in appropriations Acts. 

(Added Pub. L. 107–107, div. B, title XXVIII, Sec. 2804(a), Dec. 28, 2001, 115 Stat. 1305.) 

§ 2884. Reports 

(a) PROJECT REPORTS.—(1) The Secretary of Defense shall 

transmit to the appropriate committees of Congress a report describing— 

(A) each contract for the acquisition or construction of family housing units or unaccompanied housing units that the Secretary proposes to solicit under this subchapter; and 

(B) each conveyance or lease proposed under section 2878 

of this title. 

(2) For each proposed contract, conveyance, or lease described 

in paragraph (1), the report required by such paragraph shall include the following: 

(A) A description of the contract, conveyance, or lease, including a summary of the terms of the contract, conveyance, or 

lease. 

(B) A description of the authorities to be utilized in entering into the contract, conveyance, or lease and the intended 

method of participation of the United States in the contract, 

conveyance, or lease, including a justification of the intended 

method of participation. 

(C) A statement of the scored cost of the contract, conveyance, or lease, as determined by the Office of Management and 

Budget. 

(D) A statement of the United States funds required for 

the contract, conveyance, or lease and a description of the 

source of such funds, including a description of the specific construction, acquisition, or improvement projects from which 

funds were transferred to the Funds established under section 

2883 of this title in order to finance the contract, conveyance, 

or lease. 

(E) An economic assessment of the life cycle costs of the 

contract, conveyance, or lease, including an estimate of the 

amount of United States funds that would be paid over the life 

of the contract, conveyance, or lease from amounts derived 

from payments of government allowances, including the basic 

allowance for housing under section 403 of title 37, if the housing affected by the project were fully occupied by military personnel over the life of the contract, conveyance, or lease. 

(3)(A) In the case of a contract described in paragraph (1) proposed to be entered into with a private party, the report shall 

specify whether the contract will or may include a guarantee (including the making of mortgage or rental payments) by the Secretary to the private party in the event of— 

(i) the closure or realignment of the installation for which 

housing will be provided under the contract; 

(ii) a reduction in force of units stationed at such installation; or 

(iii) the extended deployment of units stationed at such installation. 
§ 2884 CH. 169—MIL. CONSTRUCTION & MIL. FAMILY HOUSING 1662 

(B) If the contract will or may include such a guarantee, the 

report shall also— 

(i) describe the nature of the guarantee; and 

(ii) assess the extent and likelihood, if any, of the liability 

of the United States with respect to the guarantee. 

(4) The report shall be submitted not later than 30 days before 

the date on which the Secretary issues the contract solicitation or 

offers the conveyance or lease or, if earlier, a period of 20 days has 

elapsed from the date on which a copy of the report is provided in 

an electronic medium pursuant to section 480 of this title. 

(b) ANNUAL REPORTS.—The Secretary of Defense shall include 

each year in the materials that the Secretary submits to Congress 

in support of the budget submitted by the President pursuant to 

section 1105 of title 31 the following: 

(1) A separate report on the expenditures and receipts during the preceding fiscal year covering each of the Funds established under section 2883 of this title, including a description 

of the specific construction, acquisition, or improvement 

projects from which funds were transferred and the privatization projects or contracts to which those funds were transferred. Each report shall also include, for each military department or defense agency, a description of all funds to be transferred to such Funds for the current fiscal year and the next 

fiscal year. 

(2) A methodology for evaluating the extent and effectiveness of the use of the authorities under this subchapter during 

such preceding fiscal year, and such recommendations as the 

Secretary considers necessary for improving the extent and effectiveness of the use of such authorities in the future. 

(3) A review of activities of the Secretary under this subchapter during such preceding fiscal year, shown for military 

family housing, military unaccompanied housing, dual military 

family housing and military unaccompanied housing, and ancillary supporting facilities. 

(4) If a contract for the acquisition or construction of military family housing, military unaccompanied housing, or dual 

military family housing and military unaccompanied housing 

entered into during the preceding fiscal year did not include 

the acquisition or construction of the types of ancillary supporting facilities specifically referred to in section 2871(1) of 

this title, a explanation of the reasons why such ancillary supporting facilities were not included. 

(5) A report setting forth, by armed force— 

(A) an estimate of the amounts of basic allowance for 

housing under section 403 of title 37 that will be paid, during the current fiscal year and the fiscal year for which the 

budget is submitted, to members of the armed forces living 

in housing provided under the authorities in this subchapter; and 

(B) the number of units of military family housing and 

military unaccompanied housing upon which the estimate 

under subparagraph (A) for the current fiscal year and the 

next fiscal year is based. 
1663 § 2885 CH. 169—MIL. CONSTRUCTION & MIL. FAMILY HOUSING 

(6) A description of the Secretary’s plans for housing privatization activities under this subchapter: (A) during the fiscal year for which the budget is submitted; and (B) during the 

period covered by the then-current future-years defense plan 

under section 221 of this title. 

(7) A report on best practices for the execution of housing 

privatization initiatives, including— 

(A) effective means to track and verify proper performance, schedule, and cash flow; 

(B) means of overseeing the actions of bondholders to 

properly monitor construction progress and construction 

draws; 

(C) effective structuring of transactions to ensure the 

United States Government has adequate abilities to oversee project owner performance; 

(D) ensuring that notices to proceed on new work are 

not issued until proper bonding is in place; and 

(E) such other topics that are identified as pertinent 

by the Department of Defense. 

(8) A report identifying each family housing unit acquired 

or constructed under this subchapter that is used, or intended 

to be used, as quarters for a general officer or flag officer and 

for which the total operation, maintenance, and repair costs for 

the unit exceeded $50,000. For each housing unit so identified, 

the report shall also include the total of such operation, maintenance, and repair costs. 

(Added Pub. L. 104–106, div. B, title XXVIII, Sec. 2801(a)(1), Feb. 10, 1996, 110 Stat. 550; 

amended Pub. L. 108–136, div. B, title XXVIII, Sec. 2807, Nov. 24, 2003, 117 Stat. 1722; Pub. 

L. 108–375, div. B, title XXVIII, Sec. 2806, Oct. 28, 2004, 118 Stat. 2122; Pub. L. 109–163, div. 

B, title XXVIII, Sec. 2806(c), Jan. 6, 2006, 119 Stat. 3507; Pub. L. 110–417, div. B, title XXVIII, 

Sec. 2805(b), (f), Oct. 14, 2008, 122 Stat. 4723, 4724; Pub. L. 111–383, div. A, title X, Sec. 

1075(h)(6), div. B, title XXVIII, Sec. 2803(g), Jan. 7, 2011, 124 Stat. 4377, 4459.) 

§ 2885. Oversight and accountability for privatization 

projects 

(a) OVERSIGHT AND ACCOUNTABILITY MEASURES.—Each Secretary concerned shall prescribe regulations to effectively oversee 

and manage military housing privatization projects carried out 

under this subchapter. The regulations shall include the following 

requirements for each privatization project: 

(1) The installation asset manager shall conduct monthly 

site visits and provide quarterly reports on the progress of the 

construction or renovation of the housing units. The reports 

shall be submitted quarterly to the assistant secretary for installations and environment of the respective military department. 

(2) The installation asset manager, and, as applicable, the 

resident construction manager, privatization asset manager, 

bondholder representative, project owner, developer, general 

contractor, and construction consultant for the project shall 

conduct meetings to ensure that the construction or renovation 

of the units meets performance and schedule requirements and 

that appropriate operating and ground lease agreements are in 

place and adhered to. 
§ 2885 CH. 169—MIL. CONSTRUCTION & MIL. FAMILY HOUSING 1664 

(3) If a project is 90 days or more behind schedule or otherwise appears to be substantially failing to adhere to the obligations or milestones under the contract, the assistant secretary for installations and environment of the respective military department shall submit a notice of deficiency to the Deputy Under Secretary of Defense (Installations and Environment), the Secretary concerned, the managing member, and 

the trustee for the project. 

(4)(A) Not later than 15 days after the submittal of a notice of deficiency under paragraph (3), the Secretary concerned 

or designated representative shall submit to the project owner, 

developer, or general contractor responsible for the project a 

summary of deficiencies related to the project. 

(B) If the project owner, developer, or general contractor 

responsible for the privatization project is unable, within 60 

days after receiving a notice of deficiency under subparagraph 

(A), to make progress on the issues outlined in such notice, the 

Secretary concerned shall notify the congressional defense committees of the status of the project, and shall provide a recommended course of action to correct the problems. 

(b) REQUIRED QUALIFICATIONS.—The Secretary concerned or 

designated representative shall ensure that the project owner, developer, or general contractor that is selected for each military 

housing privatization initiative project has construction experience 

commensurate with that required to complete the project. 

(c) BONDING LEVELS.—The Secretary concerned shall ensure 

that the project owner, developer, or general contractor responsible 

for a military housing privatization initiative project has sufficient 

payment and performance bonds or suitable instruments in place 

for each phase of a construction or renovation portion of the project 

to ensure successful completion of the work in amounts as agreed 

to in the project’s legal documents, but in no case less than 50 percent of the total value of the active phases of the project, prior to 

the commencement of work for that phase. 

(d) REPORTING OF EFFORTS TO SELECT SUCCESSOR IN EVENT OF

DEFAULT.—In the event a military housing privatization initiative 

project enters into default, the assistant secretary for installations 

and environment of the respective military department shall submit a report to the congressional defense committees every 90 days 

detailing the status of negotiations to award the project to a new 

project owner, developer, or general contractor. 

(e) EFFECT OF NOTICES OF DEFICIENCY ON CONTRACTORS AND

AFFILIATED ENTITIES.—(1) The Secretary concerned shall keep a 

record of all plans of action or notices of deficiency issued to a 

project owner, developer, or general contractor under subsection 

(a)(4), including the identity of each parent, subsidiary, affiliate, or 

other controlling entity of such owner, developer, or contractor. 

(2) Each military department shall consult all records maintained under paragraph (1) when reviewing the past performance 

of owners, developers, and contractors in the bidding process for a 

contract or other agreement for a military housing privatization 

initiative project. 

(Added Pub. L. 110–417, div. B, title XXVIII, Sec. 2805(a)(1), Oct. 14, 2008, 122 Stat. 4721.) 
1665 

[CHAPTER 171—REPEALED] 

[§ 2891. Repealed. Pub. L. 104–106, div. A, title X, Sec. 

1061(b)(1), 110 Stat. 442] 

CHAPTER 172—STRATEGIC ENVIRONMENTAL 

RESEARCH AND DEVELOPMENT PROGRAM 

Sec. 

2901. Strategic Environmental Research and Development Program. 

2902. Strategic Environmental Research and Development Program Council. 

2903. Executive Director. 

2904. Strategic Environmental Research and Development Program Scientific 

Advisory Board. 

§ 2901. Strategic Environmental Research and Development 

Program 

(a) The Secretary of Defense shall establish a program to be 

known as the ‘‘Strategic Environmental Research and Development 

Program’’. 

(b) The purposes of the program are as follows: 

(1) To address environmental matters of concern to the Department of Defense and the Department of Energy through 

support for basic and applied research and development of 

technologies that can enhance the capabilities of the departments to meet their environmental obligations. 

(2) To identify research, technologies, and other information developed by the Department of Defense and the Department of Energy for national defense purposes that would be 

useful to governmental and private organizations involved in 

the development of energy technologies and of technologies to 

address environmental restoration, waste minimization, hazardous waste substitution, and other environmental concerns, 

and to share such research, technologies, and other information with such governmental and private organizations. 

(3) To furnish other governmental organizations and private organizations with data, enhanced data collection capabilities, and enhanced analytical capabilities for use by such organizations in the conduct of environmental research, including 

research concerning global environmental change. 

(4) To identify technologies developed by the private sector 

that are useful for Department of Defense and Department of 

Energy defense activities concerning environmental restoration, hazardous and solid waste minimization and prevention, 

hazardous material substitution, and provide for the use of 

such technologies in the conduct of such activities. 

(Added Pub. L. 101–510, div. A, title XVIII, Sec. 1801(a)(1), Nov. 5, 1990, 104 Stat. 1751.) 
§ 2902 CH. 172—STRATEGIC ENVIRONMENTAL R&D PROGRAM 1666 

§ 2902. Strategic Environmental Research and Development 

Program Council 

(a) There is a Strategic Environmental Research and Development Program Council (hereinafter in this chapter referred to as 

the ‘‘Council’’). 

(b) The Council is composed of 12 members as follows: 

(1) The official within the Office of the Assistant Secretary 

of Defense for Research and Engineering who is responsible for 

science and technology. 

(2) The Vice Chairman of the Joint Chiefs of Staff. 

(3) The official within the Office of the Under Secretary of 

Defense for Acquisition, Technology, and Logistics who is responsible for environmental security. 

(4) The Assistant Secretary of Energy for Defense programs. 

(5) The Assistant Secretary of Energy responsible for environmental restoration and waste management. 

(6) The Director of the Department of Energy Office of 

Science. 

(7) The Administrator of the Environmental Protection 

Agency. 

(8) One representative from each of the Army, Navy, Air 

Force, and Coast Guard. 

(9) The Executive Director of the Council (appointed pursuant to section 2903 of this title), who shall be a nonvoting 

member. 

(c) The Secretary of Defense shall designate a member of the 

Council as chairman for each odd numbered fiscal year. The Secretary of Energy shall designate a member of the Council as chairman for each even-numbered fiscal year. 

(d) The Council shall have the following responsibilities: 

(1) To prescribe policies and procedures to implement the 

Strategic Environmental Research and Development Program. 

(2) To enter into contracts, grants, and other financial arrangements, in accordance with other applicable law, to carry 

out the purposes of the Strategic Environmental Research and 

Development Program. 

(3) To prepare an annual report that contains the following: 

(A) A description of activities of the strategic environmental research and development program carried out 

during the fiscal year before the fiscal year in which the 

report is prepared. 

(B) A general outline of the activities planned for the 

program during the fiscal year in which the report is prepared. 

(C) A summary of projects continued from the fiscal 

year before the fiscal year in which the report is prepared 

and projects expected to be started during the fiscal year 

in which the report is prepared and during the following 

fiscal year. 

(D) A summary of the actions of the Strategic Environmental Research and Development Program Scientific Ad-
1667 § 2902 CH. 172—STRATEGIC ENVIRONMENTAL R&D PROGRAM 

visory Board during the year preceding the year in which 

the report is submitted and any recommendations, including recommendations on program direction and legislation, 

that the Advisory Board considers appropriate regarding 

the program. 

(4) To promote the maximum exchange of information, and 

to minimize duplication, regarding environmentally related research, development, and demonstration activities through 

close coordination with the military departments and Defense 

Agencies, the Department of Energy, the Environmental Protection Agency, the National Oceanic and Atmospheric Administration, the National Aeronautics and Space Administration, 

other departments and agencies of the Federal Government or 

any State and local governments, including the National 

Science and Technology Council, and other organizations engaged in such activities. 

(5) To ensure that research and development activities 

under the Strategic Environmental Research and Development 

Program do not duplicate other ongoing activities sponsored by 

the Department of Defense, the Department of Energy, the Environmental Protection Agency, the National Oceanic and Atmospheric Administration, the National Aeronautics and Space 

Administration, or any other department or agency of the Federal Government. 

(6) To ensure that the research and development programs 

identified for support pursuant to policies and procedures prescribed by the council utilize, to the maximum extent possible, 

the talents, skills, and abilities residing at the Federal laboratories, including the Department of Energy multiprogram and 

defense laboratories, the Department of Defense laboratories, 

and Federal contract research centers. To utilize the research 

capabilities of institutions of higher education and private industry to the extent practicable. 

(e) In carrying out subsection (d)(1), the Council shall prescribe 

policies and procedures that— 

(1) provide for appropriate access by Federal Government 

personnel, State and local government personnel, college and 

university personnel, industry personnel, and the general public to data under the control of, or otherwise available to, the 

Department of Defense that is relevant to environmental matters by— 

(A) identifying the sources of such data; 

(B) publicizing the availability and sources of such 

data by appropriately-targeted dissemination of information to such personnel and the general public, and by other 

means; and 

(C) providing for review of classified data relevant to 

environmental matters with a view to declassifying or preparing unclassified summaries of such data; 

(2) provide governmental and nongovernmental entities 

with analytic assistance, consistent with national defense missions, including access to military platforms for sensor deployment and access to computer capabilities, in order to facilitate 

environmental research; 
§ 2902 CH. 172—STRATEGIC ENVIRONMENTAL R&D PROGRAM 1668 

(3) provide for the identification of energy technologies developed for national defense purposes (including electricity generation systems, energy storage systems, alternative fuels, biomass energy technology, and applied materials technology) 

that might have environmentally sound, energy efficient applications for other programs of the Department of Defense and 

the Department of Energy national security programs; 

(4) provide for the identification and support of programs 

of basic and applied research, development, and demonstration 

in technologies useful— 

(A) to facilitate environmental compliance, remediation, and restoration activities of the Department of Defense and at Department of Energy defense facilities; 

(B) to minimize waste generation, including reduction 

at the source, by such departments; or 

(C) to substitute use of nonhazardous, nontoxic, nonpolluting, and other environmentally sound materials and 

substances for use of hazardous, toxic, and polluting materials and substances by such departments; 

(5) provide for the identification and support of research, 

development, and application of other technologies developed 

for national defense purposes which not only are directly useful 

for programs, projects, and activities of such departments, but 

also have useful applications for solutions to such national and 

international environmental problems as climate change and 

ozone depletion; 

(6) provide for the Secretary of Defense, the Secretary of 

Energy, and the Administrator of the Environmental Protection Agency, in cooperation with other Federal and State agencies, as appropriate, to conduct joint research, development, 

and demonstration projects relating to innovative technologies, 

management practices, and other approaches for purposes of— 

(A) preventing pollution from all sources; 

(B) minimizing hazardous and solid waste, including 

recycling; and 

(C) treating hazardous and solid waste, including the 

use of thermal, chemical, and biological treatment technologies; 

(7) encourage transfer of technologies referred to in clauses 

(2) through (6) to the private sector under the StevensonWydler Technology Innovation Act of 1980 (15 U.S.C. 3701 et 

seq.) and other applicable laws; 

(8) provide for the identification of, and planning for the 

demonstration and use of, existing environmentally sound, energy-efficient technologies developed by the private sector that 

could be used directly by the Department of Defense; 

(9) provide for the identification of military specifications 

that prevent or limit the use of environmentally beneficial 

technologies, materials, and substances in the performance of 

Department of Defense contracts and recommend changes to 

such specifications; and 

(10) to ensure that the research and development programs identified for support pursuant to the policies and procedures prescribed by the Council are closely coordinated with, 
1669 § 2904 CH. 172—STRATEGIC ENVIRONMENTAL R&D PROGRAM 

and do not duplicate, ongoing activities sponsored by the Department of Defense, the Department of Energy, the Environmental Protection Agency, the National Aeronautics and Space 

Administration, the National Oceanic and Atmospheric Administration, or other Federal agencies. 

(f) The Council shall be subject to the authority, direction, and 

control of the Secretary of Defense in prescribing policies and procedures under subsection (d)(1). 

(g) Not later than February 1 of each year, the Council shall 

submit to the Secretary of Defense the annual report prepared pursuant to subsection (d)(3). 

(Added Pub. L. 101–510, div. A, title XVIII, Sec. 1801(a)(1), Nov. 5, 1990, 104 Stat. 1751; amended Pub. L. 102–190, div. A, title II, Sec. 257(a), title X, Sec. 1061(a)(19), Dec. 5, 1991, 105 Stat. 

1331, 1473; Pub. L. 102–484, div. A, title X, Sec. 1052(38), Oct. 23, 1992, 106 Stat. 2501; Pub. 

L. 103–160, div. A, title II, Sec. 265(a), Nov. 30, 1993, 107 Stat. 1611; Pub. L. 104–106, div. 

A, title II, Sec. 203(a), (b)(1), (2), (c), Feb. 10, 1996, 110 Stat. 217, 218; Pub. L. 105–245, title 

III, Sec. 309(b)(2)(B), Oct. 7, 1998, 112 Stat. 1853; Pub. L. 106–65, div. A, title III, Sec. 324, 

Oct. 5, 1999, 113 Stat. 563; Pub. L. 106–398, Sec. 1 [[div. A], title III, Sec. 313(b)], Oct. 30, 2000, 

114 Stat. 1654, 1654A–55; Pub. L. 108–136, div. A, title X, Sec. 1031(a)(52), Nov. 24, 2003, 117 

Stat. 1603; Pub. L. 111–383, div. A, title IX, Sec. 901(j)(5), Jan. 7, 2011, 124 Stat. 4324.) 

§ 2903. Executive Director 

(a) There shall be an Executive Director of the Council appointed by the Secretary of Defense after consultation with the Secretary of Energy. 

(b) Subject to the authority, direction, and control of the Secretary of Defense, the Executive Director is responsible for the 

management of the Strategic Environmental Research and Development Program in accordance with the policies established by the 

Council. 

(c) The Executive Director may enter into contracts using competitive procedures. The Executive Director may enter into other 

agreements in accordance with applicable law. In either case, the 

Executive Director shall first obtain the approval of the Council for 

any contract or agreement in an amount equal to or in excess of 

$500,000 or such lesser amount as the Council may prescribe. 

(d)(1) The Executive Director, with the concurrence of the 

Council, may appoint such professional and clerical staff as may be 

necessary to carry out the responsibilities and policies of the Council. 

(2) The Executive Director, with the concurrence of the Council 

and without regard to the provisions of chapter 51 of title 5 and 

subchapter III of chapter 53 of such title, may establish the rates 

of basic pay for professional, scientific, and technical employees appointed pursuant to paragraph (1). 

(Added Pub. L. 101–510, div. A, title XVIII, Sec. 1801(a)(1), Nov. 5, 1990, 104 Stat. 1755; amended Pub. L. 102–25, title VII, Sec. 701(h)(2), Apr. 6, 1991, 105 Stat. 115; Pub. L. 103–160, div. 

A, title II, Sec. 265(b), Nov. 30, 1993, 107 Stat. 1611; Pub. L. 104–106, div. A, title II, Sec. 

203(d), (e)(1), Feb. 10, 1996, 110 Stat. 218.) 

§ 2904. Strategic Environmental Research and Development 

Program Scientific Advisory Board 

(a) The Secretary of Defense and the Secretary of Energy, in 

consultation with the Administrator of the Environmental Protection Agency, shall jointly appoint a Strategic Environmental Research and Development Program Scientific Advisory Board (here-
§ 2904 CH. 172—STRATEGIC ENVIRONMENTAL R&D PROGRAM 1670 

after in this section referred to as the ‘‘Advisory Board’’) consisting 

of not less than six and not more than 14 members. 

(b)(1) The following persons shall be permanent members of 

the Advisory Board: 

(A) The Science Advisor to the President, or his designee. 

(B) The Administrator of the National Oceanic and Atmospheric Administration, or his designee. 

(2) Other members of the Advisory Board shall be appointed 

from among persons eminent in the fields of basic sciences, engineering, ocean and environmental sciences, education, research 

management, international and security affairs, health physics, 

health sciences, or social sciences, with due regard given to the equitable representation of scientists and engineers who are women 

or who represent minority groups. At least one member of the Advisory Board shall be a representative of environmental public interest groups and one member shall be a representative of the interests of State governments. 

(3) The Secretary of Defense and the Secretary of Energy, in 

consultation with the Administrator of the Environmental Protection Agency, shall request— 

(A) that the head of the National Academy of Sciences, in 

consultation with the head of the National Academy of Engineering and the head of the Institutes of Medicine of the National Academy of Sciences, nominate persons for appointment 

to the Advisory Board; 

(B) that the Council on Environmental Quality nominate 

for appointment to the Advisory Board at least one person who 

is a representative of environmental public interest groups; 

and 

(C) that the National Association of Governors nominate 

for appointment to the Advisory Board at least one person who 

is representative of the interests of State governments. 

(4) Members of the Advisory Board shall be appointed for 

terms of not less than two and not more than four years. 

(c) A member of the Advisory Board who is not otherwise employed by the Federal Government shall not be considered to be a 

Federal employee, except for the purposes of chapter 81 of title 5 

(relating to compensation for work-related injuries) and chapter 

171 of title 28 (relating to tort claims). 

(d) The Advisory Board shall prescribe procedures for carrying 

out its responsibilities. Such procedures shall define a quorum as 

a majority of the members, provide for annual election of the 

Chairman by the members of the Advisory Board, and require at 

least four meetings of the Advisory Board each year. 

(e) The Council shall refer to the Advisory Board, and the Advisory Board shall review, each proposed research project including 

its estimated cost, for research in and development of technologies 

related to environmental activities in excess of $1,000,000. The Advisory Board shall make any recommendations to the Council that 

the Advisory Board considers appropriate regarding such project or 

proposal. 

(f) The Advisory Board may make recommendations to the 

Council regarding technologies, research, projects, programs, activi-
1671 § 2904 CH. 172—STRATEGIC ENVIRONMENTAL R&D PROGRAM 

ties, and, if appropriate, funding within the scope of the Strategic 

Environmental Research and Development Program. 

(g) The Advisory Board shall assist and advise the Council in 

identifying the environmental data and analytical assistance activities that should be covered by the policies and procedures prescribed pursuant to section 2902(d)(1) of this title. 

(h) Each member of the Advisory Board shall be required to 

file a financial disclosure report under title I of the Ethics in Government Act of 1978 (5 U.S.C. App.). 

(Added Pub. L. 101–510, div. A, title XVIII, Sec. 1801(a)(1), Nov. 5, 1990, 104 Stat. 1756; amended Pub. L. 102–190, div. A, title II, Sec. 257(b), Dec. 5, 1991, 105 Stat. 1331; Pub. L. 105–85, 

div. A, title III, Sec. 341, Nov. 18, 1997, 111 Stat. 1686; Pub. L. 106–398, Sec. 1 ((div. A), title 

III, Sec. 313(a)), Oct. 30, 2000, 114 Stat. 1654, 1654A–55.) 
1672 

CHAPTER 173—ENERGY SECURITY 

Subchapter Sec. 

I. Energy Security Activities ......................................................................... 2911 

II. Energy Related Procurement .................................................................... 2922 

III. General Provisions ..................................................................................... 2925 

SUBCHAPTER I—ENERGY SECURITY ACTIVITIES 

Sec. 

2911. Energy performance goals and master plan for the Department of Defense. 

2912. Availability and use of energy cost savings. 

2913. Energy savings contracts and activities. 

2914. Energy conservation construction projects. 

2915. Facilities: use of renewable forms of energy and energy efficient products. 

2916. Sale of electricity from alternate energy and cogeneration production facilities. 

2917. Development of geothermal energy on military lands. 

2918. Fuel sources for heating systems; prohibition on converting certain heating 

facilities. 

2919. Department of Defense participation in programs for management of energy demand or reduction of energy usage during peak periods. 

§ 2911. Energy performance goals and master plan for the 

Department of Defense 

(a) ENERGY PERFORMANCE GOALS.—(1) The Secretary of Defense shall submit to the congressional defense committees the energy performance goals for the Department of Defense regarding 

transportation systems, support systems, utilities, and infrastructure and facilities. 

(2) The energy performance goals shall be submitted annually 

not later than the date on which the President submits to Congress 

the budget for the next fiscal year under section 1105 of title 31 

and cover that fiscal year as well as the next five, l0, and 20 years. 

The Secretary shall identify changes to the energy performance 

goals since the previous submission. 

(b) ENERGY PERFORMANCE MASTER PLAN.—(1) The Secretary of 

Defense shall develop a comprehensive master plan for the achievement of the energy performance goals of the Department of Defense, as set forth in laws, executive orders, and Department of Defense policies. 

(2) The master plan shall include the following: 

(A) A separate master plan, developed by each military department and Defense Agency, for the achievement of energy 

performance goals. 

(B) The use of a baseline standard for the measurement of 

energy consumption by transportation systems, support systems, utilities, and facilities and infrastructure that is consistent for all of the military departments. 

(C) A method of measurement of reductions or conservation in energy consumption that provides for the taking into 
1673 § 2911 CH. 173—ENERGY SECURITY 

account of changes in the current size of fleets, number of facilities, and overall square footage of facility plants. 

(D) Metrics to track annual progress in meeting energy 

performance goals. 

(E) A description of specific requirements, and proposed investments, in connection with the achievement of energy performance goals reflected in the budget of the President for each 

fiscal year (as submitted to Congress under section 1105(a) of 

title 31). 

(3) Not later than 30 days after the date on which the budget 

of the President is submitted to Congress for a fiscal year under 

section 1105(a) of title 31, the Secretary shall submit the current 

version of the master plan to Congress. 

(c) SPECIAL CONSIDERATIONS.—For the purpose of developing 

and implementing the energy performance goals and energy performance master plan, the Secretary of Defense shall consider at 

a minimum the following: 

(1) Opportunities to reduce the current rate of consumption of energy. 

(2) Opportunities to reduce the future demand and the requirements for the use of energy. 

(3) Opportunities to implement conservation measures to 

improve the efficient use of energy. 

(4) Opportunities to pursue alternative energy initiatives, 

including the use of alternative fuels and hybrid-electric drive 

in military vehicles and equipment. 

(5) Opportunities for the high-performance construction, 

lease, operation, and maintenance of buildings. 

(6) Cost effectiveness, cost savings, and net present value 

of alternatives. 

(7) The value of diversification of types and sources of energy used. 

(8) The value of economies-of-scale associated with fewer 

energy types used. 

(9) The value of the use of renewable energy sources. 

(10) The value of incorporating electric, hybrid-electric, 

and high efficiency vehicles into vehicle fleets. 

(11) The potential for an action to serve as an incentive for 

members of the armed forces and civilian personnel to reduce 

energy consumption or adopt an improved energy performance 

measure. 

(d) SELECTION OF ENERGY CONSERVATION MEASURES.—(1) For 

the purpose of implementing the energy performance master plan, 

the Secretary of Defense shall provide that the selection of energy 

conservation measures, including energy efficient maintenance, 

shall be limited to those measures that— 

(A) are readily available; 

(B) demonstrate an economic return on the investment; 

(C) are consistent with the energy performance goals and 

energy performance master plan for the Department; and 

(D) are supported by the special considerations specified in 

subsection (c). 

(2) In this subsection, the term ‘‘energy efficient maintenance’’ 

includes— 
§ 2912 CH. 173—ENERGY SECURITY 1674 

(A) the repair of military vehicles, equipment, or facility 

and infrastructure systems, such as lighting, heating, or cooling equipment or systems, or industrial processes, by replacement with technology that— 

(i) will achieve energy savings over the life-cycle of the 

equipment or system being repaired; and 

(ii) will meet the same end needs as the equipment or 

system being repaired; and 

(B) improvements in an operation or maintenance process, 

such as improved training or improved controls, that result in 

energy savings. 

(e) GOAL REGARDING USE OF RENEWABLE ENERGY TO MEET FA- CILITY ENERGY NEEDS.—(1) It shall be the goal of the Department 

of Defense— 

(A) to produce or procure not less than 25 percent of the 

total quantity of facility energy it consumes within its facilities 

during fiscal year 2025 and each fiscal year thereafter from renewable energy sources; and 

(B) to produce or procure facility energy from renewable 

energy sources whenever the use of such renewable energy 

sources is consistent with the energy performance goals and 

energy performance master plan for the Department and supported by the special considerations specified in subsection (c). 

(2) In this subsection, the term ‘‘renewable energy source’’ 

means energy generated from renewable sources, including the following: 

(A) Solar. 

(B) Wind. 

(C) Biomass. 

(D) Landfill gas. 

(E) Ocean, including tidal, wave, current, and thermal. 

(F) Geothermal, including electricity and heat pumps. 

(G) Municipal solid waste. 

(H) New hydroelectric generation capacity achieved from 

increased efficiency or additions of new capacity at an existing 

hydroelectric project. For purposes of this subparagraph, hydroelectric generation capacity is ‘‘new’’ if it was placed in service on or after January 1, 1999. 

(I) Thermal energy generated by any of the preceding 

sources. 

(Added and amended Pub. L. 109–364, div. B, title XXVIII, Secs. 2851(a)(1), 2852, Oct. 17, 2006, 

120 Stat. 2489, 2496; Pub. L. 111–84, div. B, title XXVIII, Sec. 2842, Oct. 28, 2009, 123 Stat. 

2680; Pub. L. 111–383, div. B, title XXVIII, Secs. 2831, 2832(a), Jan. 7, 2011, 124 Stat. 4467, 

4468.) 

§ 2912. Availability and use of energy cost savings 

(a) AVAILABILITY.—An amount of the funds appropriated to the 

Department of Defense for a fiscal year that is equal to the amount 

of energy cost savings realized by the Department, including financial benefits resulting from shared energy savings contracts entered into under section 2913 of this title, shall remain available 

for obligation under subsection (b) until expended, without additional authorization or appropriation. 

(b) USE.—The Secretary of Defense shall provide that the 

amount that remains available for obligation under subsection (a) 
1675 § 2913 CH. 173—ENERGY SECURITY 

and the funds made available under section 2916(b)(2) of this title 

shall be used as follows: 

(1) One-half of the amount shall be used for the implementation of additional energy conservation measures at buildings, 

facilities, or installations of the Department of Defense or related to vehicles and equipment of the Department, which are 

designated, in accordance with regulations prescribed by the 

Secretary of Defense, by the head of the department, agency, 

or instrumentality that realized the savings referred to in subsection (a). 

(2) One-half of the amount shall be used at the installation 

at which the savings were realized, as determined by the commanding officer of such installation consistent with applicable 

law and regulations, for— 

(A) improvements to existing military family housing 

units; 

(B) any unspecified minor construction project that 

will enhance the quality of life of personnel; or 

(C) any morale, welfare, or recreation facility or service. 

(c) TREATMENT OF CERTAIN FINANCIAL INCENTIVES.—Financial 

incentives received from gas or electric utilities under section 2913 

of this title shall be credited to an appropriation designated by the 

Secretary of Defense. Amounts so credited shall be merged with the 

appropriation to which credited and shall be available for the same 

purposes and the same period as the appropriation with which 

merged. 

(d) CONGRESSIONAL NOTIFICATION.—The Secretary of Defense 

shall include in the budget material submitted to Congress in connection with the submission of the budget for a fiscal year pursuant to section 1105 of title 31 a separate statement of the amounts 

available for obligation under this section in that fiscal year. 

(Added Pub. L. 109–364, div. B, title XXVIII, Sec. 2851(a)(1), Oct. 17, 2006, 120 Stat. 2491.) 

§ 2913. Energy savings contracts and activities 

(a) SHARED ENERGY SAVINGS CONTRACTS.—(1) The Secretary of 

Defense shall develop a simplified method of contracting for shared 

energy savings contract services that will accelerate the use of 

these contracts with respect to military installations and will reduce the administrative effort and cost on the part of the Department of Defense as well as the private sector. 

(2) In carrying out paragraph (1), the Secretary of Defense 

may— 

(A) request statements of qualifications (as prescribed by 

the Secretary of Defense), including financial and performance 

information, from firms engaged in providing shared energy 

savings contracting; 

(B) designate from the statements received, with an update at least annually, those firms that are presumptively 

qualified to provide shared energy savings services; 

(C) select at least three firms from the qualifying list to 

conduct discussions concerning a particular proposed project, 

including requesting a technical and price proposal from such 

selected firms for such project; and 
§ 2913 CH. 173—ENERGY SECURITY 1676 

(D) select from such firms the most qualified firm to provide shared energy savings services pursuant to a contractual 

arrangement that the Secretary determines is fair and reasonable, taking into account the estimated value of the services to 

be rendered and the scope and nature of the project. 

(3) In carrying out paragraph (1), the Secretary may also provide for the direct negotiation, by departments, agencies, and instrumentalities of the Department of Defense, of contracts with 

shared energy savings contractors that have been selected competitively and approved by any gas or electric utility serving the department, agency, or instrumentality concerned. 

(b) PARTICIPATION IN GAS OR ELECTRIC UTILITY PROGRAMS.— 

The Secretary of Defense shall permit and encourage each military 

department, Defense Agency, and other instrumentality of the Department of Defense to participate in programs conducted by any 

gas or electric utility for the management of energy demand or for 

energy conservation. 

(c) ACCEPTANCE OF FINANCIAL INCENTIVE, GOODS, OR SERVICES.—The Secretary of Defense may authorize any military installation to accept any financial incentive, goods, or services generally 

available from a gas or electric utility, to adopt technologies and 

practices that the Secretary determines are in the interests of the 

United States and consistent with the energy performance goals for 

the Department of Defense. 

(d) AGREEMENTS WITH GAS OR ELECTRIC UTILITIES.—(1) The 

Secretary of Defense may authorize the Secretary of a military department having jurisdiction over a military installation to enter 

into agreements with gas or electric utilities to design and implement cost-effective demand and conservation incentive programs 

(including energy management services, facilities alterations, and 

the installation and maintenance of energy saving devices and 

technologies by the utilities) to address the requirements and circumstances of the installation. 

(2) If an agreement under this subsection provides for a utility 

to advance financing costs for the design or implementation of a 

program referred to in that paragraph to be repaid by the United 

States, the cost of such advance may be recovered by the utility 

under terms no less favorable than those applicable to its most favored customer. 

(3) Subject to the availability of appropriations, repayment of 

costs advanced under paragraph (2) shall be made from funds 

available to a military department for the purchase of utility services. 

(4) An agreement under this subsection shall provide that title 

to any energy-saving device or technology installed at a military installation pursuant to the agreement vest in the United States. 

Such title may vest at such time during the term of the agreement, 

or upon expiration of the agreement, as determined to be in the 

best interests of the United States. 

(Added and amended Pub. L. 109–364, div. B, title XXVIII, Secs. 2851(a)(1), 2853, Oct. 17, 2006, 

120 Stat. 2491, 2496; Pub. L. 110–140, title V, Sec. 511(c), Dec. 19, 2007, 121 Stat. 1658; Pub. 

L. 110–181, div. B, title XXVIII, Sec. 2861, Jan. 28, 2008, 122 Stat. 559.) 
1677 § 2915 CH. 173—ENERGY SECURITY 

§ 2914. Energy conservation construction projects 

(a) PROJECTS AUTHORIZED.—The Secretary of Defense may 

carry out a military construction project for energy conservation, 

not previously authorized, using funds appropriated or otherwise 

made available for that purpose. 

(b) CONGRESSIONAL NOTIFICATION.—When a decision is made 

to carry out a project under this section, the Secretary of Defense 

shall notify in writing the appropriate committees of Congress of 

that decision. The project may then be carried out only after the 

end of the 21-day period beginning on the date the notification is 

received by such committees or, if earlier, the end of the 14-day period beginning on the date on which a copy of the notification is 

provided in an electronic medium pursuant to section 480 of this 

title. 

(Added Pub. L. 109–364, div. B, title XXVIII, Sec. 2851(a)(1), Oct. 17, 2006, 120 Stat. 2493.) 

§ 2915. Facilities: use of renewable forms of energy and energy efficient products 

(a) USE OF RENEWABLE FORMS OF ENERGY ENCOURAGED.—The 

Secretary of Defense shall encourage the use of energy systems 

using solar energy or other renewable forms of energy as a source 

of energy for military construction projects (including military family housing projects) and facility repairs and renovations where use 

of such form of energy is consistent with the energy performance 

goals and energy performance master plan for the Department of 

Defense developed under section 2911 of this title and supported by 

the special considerations specified in subsection (c) of such section. 

(b) CONSIDERATION DURING DESIGN PHASE OF PROJECTS.—(1) 

The Secretary concerned shall require that the design for the construction, repair, or renovation of facilities (including family housing and back-up power generation facilities) requires consideration 

of energy systems using solar energy or other renewable forms of 

energy when use of a renewable form of energy— 

(A) is consistent with the energy performance goals and 

energy performance master plan for the Department of Defense 

developed under section 2911 of this title; and 

(B) supported by the special considerations specified in 

subsection (c) of such section. 

(2) The Secretary concerned shall require that contracts for 

construction resulting from such design include a requirement that 

energy systems using solar energy or other renewable forms of energy be installed if such systems can be shown to be cost effective. 

(c) DETERMINATION OF COST EFFECTIVENESS.—(1) For the purposes of this section, an energy system using solar energy or other 

renewable forms of energy for a facility shall be considered to be 

cost effective if the difference between (A) the original investment 

cost of the energy system for the facility with such a system, and 

(B) the original investment cost of the energy system for the facility 

without such a system can be recovered over the expected life of 

the facility. 

(2) A determination under paragraph (1) concerning whether a 

cost-differential can be recovered over the expected life of a facility 

shall be made using the life-cycle cost methods and procedures es-
§ 2915 CH. 173—ENERGY SECURITY 1678 

tablished pursuant to section 544(a) of the National Energy Conservation Policy Act (42 U.S.C. 8254(a)). 

(d) EXCEPTION TO SQUARE FEET AND COST PER SQUARE FOOT

LIMITATIONS.—In order to equip a military construction project (including a military family housing project) with heating equipment, 

cooling equipment, or both heating and cooling equipment using 

solar energy or other renewable forms of energy or with a passive 

energy system using solar energy or other renewable forms of energy, the Secretary concerned may authorize an increase in any 

otherwise applicable limitation with respect to the number of 

square feet or the cost per square foot of the project by such 

amount as may be necessary for such purpose. Any such increase 

under this subsection shall be in addition to any other administrative increase in cost per square foot or variation in floor area authorized by law. 

(e) USE OF ENERGY EFFICIENT PRODUCTS IN FACILITIES.—(1) 

The Secretary of Defense shall ensure, to the maximum extent 

practicable, that energy efficient products meeting the requirements of the Department of Defense are used in construction, repair, or renovation of facilities by or for the Department carried out 

under chapter 169 of this title if such products are readily available 

and their use is consistent with the energy performance goals and 

energy performance master plan for the Department developed 

under section 2911 of this title and supported by the special considerations specified in subsection (c) of such section. 

(2) For purposes of this subsection, energy efficient products 

may include, at a minimum, the following technologies, consistent 

with the products specified in paragraph (3): 

(A) Roof-top solar thermal, photovoltaic, and energy reducing coating technologies. 

(B) Energy management control and supervisory control 

and data acquisition systems. 

(C) Energy efficient heating, ventilation, and air conditioning systems. 

(D) Thermal windows and insulation systems. 

(E) Electric meters. 

(F) Lighting, equipment, and appliances that are designed 

to use less electricity. 

(G) Hybrid vehicle plug-in charging stations. 

(H) Solar-power collecting structures to shade vehicle 

parking areas. 

(I) Wall and roof insulation systems and air infiltrationmitigation systems, such as weatherproofing. 

(3) In determining the energy efficiency of products, the Secretary shall consider products that— 

(A) meet or exceed Energy Star specifications; or 

(B) are listed on the Federal Energy Management Program 

Product Energy Efficiency Recommendations product list of the 

Department of Energy. 

(Added Pub. L. 97–214, Sec. 2(a), July 12, 1982, 96 Stat. 166, Sec. 2857; amended Pub. L. 97– 

321, title VIII, Sec. 801(b)(1), (2), Oct. 15, 1982, 96 Stat. 1571; Pub. L. 98–525, title XIV, Sec. 

1405(45)(A), Oct. 19, 1984, 98 Stat. 2625; Pub. L. 101–218, Sec. 8(b), Dec. 11, 1989, 103 Stat. 

1868; Pub. L. 101–510, div. B, title XXVIII, Sec. 2852(b), Nov. 5, 1990, 104 Stat. 1804; Pub. L. 

102–25, title VII, Sec. 701(g)(2), Apr. 6, 1991, 105 Stat. 115; renumbered Sec. 2915 and amended 

Pub. L. 109–364, div. B, title XXVIII, Secs. 2851(b)(1), (3)(A), 2854, Oct. 17, 2006, 120 Stat. 

2494, 2497; Pub. L. 111–383, div. B, title XXVIII, Sec. 2832(b), Jan. 7, 2011, 124 Stat. 4468.) 
1679 § 2918 CH. 173—ENERGY SECURITY 

§ 2916. Sale of electricity from alternate energy and cogeneration production facilities 

(a) The Secretary of a military department may sell, contract 

to sell, or authorize the sale by a contractor to a public or private 

utility company of electrical energy generated from alternate energy or cogeneration type production facilities which are under the 

jurisdiction (or produced on land which is under the jurisdiction) of 

the Secretary concerned. The sale of such energy shall be made 

under such regulations, for such periods, and at such prices as the 

Secretary concerned prescribes consistent with the Public Utility 

Regulatory Policies Act of 1978 (16 U.S.C. 2601 et seq.). 

(b)(1) Proceeds from sales under subsection (a) shall be credited to the appropriation account currently available to the military 

department concerned for the supply of electrical energy. 

(2) Subject to the availability of appropriations for this purpose, proceeds credited under paragraph (1) may be used to carry 

out military construction projects under the energy performance 

plan developed by the Secretary of Defense under section 2911(b) 

of this title, including minor military construction projects authorized under section 2805 of this title that are designed to increase 

energy conservation. 

(c) Before carrying out a military construction project described 

in subsection (b) using proceeds from sales under subsection (a), 

the Secretary concerned shall notify Congress in writing of the 

project, the justification for the project, and the estimated cost of 

the project. The project may be carried out only after the end of the 

21-day period beginning on the date the notification is received by 

Congress or, if earlier, the end of the 14-day period beginning on 

the date on which a copy of the notification is provided in an electronic medium pursuant to section 480 of this title. 

(Added Pub. L. 98–407, title VIII, Sec. 810(a), Aug. 28, 1984, 98 Stat. 1523, Sec. 2483; Pub. L. 

103–160, div. B, title XXVIII, Sec. 2802, Nov. 30, 1993, 107 Stat. 1884; renumbered Sec. 2867, 

Pub. L. 105–85, div. A, title III, Sec. 371(b)(2), Nov. 18, 1997, 110 Stat. 1705; Pub. L. 108–136, 

div. A, title X, Sec. 1031(a)(49), Nov. 24, 2003, 117 Stat. 1602; renumbered Sec. 2916 and 

amended Pub. L. 109–364, div. B, title XXVIII, Sec. 2851(b)(1), (3)(B), Oct. 17, 2006, 120 Stat. 

2494.) 

§ 2917. Development of geothermal energy on military lands 

The Secretary of a military department may develop, or authorize the development of, any geothermal energy resource within 

lands under the Secretary’s jurisdiction, including public lands, for 

the use or benefit of the Department of Defense if that development is in the public interest, as determined by the Secretary concerned, and will not deter commercial development and use of other 

portions of such resource if offered for leasing. 

(Added Pub. L. 97–214, Sec. 6(c)(1), July 12, 1982, 96 Stat. 172, Sec. 2689; renumbered Sec. 

2917, Pub. L. 109–364, div. B, title XXVIII, Sec. 2851(b)(1), Oct. 17, 2006, 120 Stat. 2494.) 

§ 2918. Fuel sources for heating systems; prohibition on converting certain heating facilities 

(a)(1) The Secretary of the military department concerned shall 

provide that the primary fuel source to be used in any new heating 

system constructed on lands under the jurisdiction of the military 

department is the most cost effective fuel for that heating system 

over the life cycle of the system. 
§ 2919 CH. 173—ENERGY SECURITY 1680 

(2) The Secretary of Defense shall prescribe regulations for the 

determination of the life-cycle cost effectiveness of a fuel for the 

purposes of paragraph (1). 

(b) The Secretary of a military department may not convert a 

heating facility at a United States military installation in Europe 

from a coal-fired facility to an oil-fired facility, or to any other energy source facility, unless the Secretary determines that the conversion— 

(1) is required by the government of the country in which 

the facility is located; or 

(2) is cost-effective over the life cycle of the facility. 

(Added Pub. L. 97–214, Sec. 6(c)(1), July 12, 1982, 96 Stat. 173; Sec. 2690, amended Pub. L. 

99–661, div. A, title XII, Sec. 1205(a)(1), Nov. 14, 1986, 100 Stat. 3971; Pub. L. 105–85, div. 

A, title X, Sec. 1041(a), Nov. 18, 1997, 111 Stat. 1885; renumbered Sec. 2918, Pub. L. 109–364, 

div. B, title XXVIII, Sec. 2851(b)(1), Oct. 17, 2006, 120 Stat. 2494.) 

§ 2919. Department of Defense participation in programs for 

management of energy demand or reduction of energy usage during peak periods 

(a) PARTICIPATION IN DEMAND RESPONSE OR LOAD MANAGE- MENT PROGRAMS.—The Secretary of Defense, the Secretaries of the 

military departments, the heads of the Defense Agencies, and the 

heads of other instrumentalities of the Department of Defense are 

authorized to participate in demand response programs for the 

management of energy demand or the reduction of energy usage 

during peak periods conducted by any of the following parties: 

(1) An electric utility. 

(2) An independent system operator. 

(3) A State agency. 

(4) A third party entity (such as a demand response 

aggregator or curtailment service provider) implementing demand response programs on behalf of an electric utility, independent system operator, or State agency. 

(b) TREATMENT OF CERTAIN FINANCIAL INCENTIVES.—Financial 

incentives received from an entity specified in subsection (a) shall 

be— 

(1) received as a cost reduction in the utility bill for a facility; or 

(2) deposited into the fund established under subsection (c) 

for use, to the extent provided for in an appropriations Act, by 

the military department, Defense Agency, or instrumentality 

receiving such financial incentive for energy management initiatives. 

(c) ENERGY SAVINGS FINANCIAL INCENTIVES FUND.—There is 

established in the Treasury a fund to be known as the ‘‘Energy 

Savings Financial Incentives Fund’’. The Fund shall consist of any 

amount deposited in the Fund pursuant to subsection (b)(2) and 

amounts appropriated or otherwise made available to the Fund by 

law. 

(Added Pub. L. 111–84, div. B, title XXVIII, Sec. 2843(a), Oct. 28, 2009, 123 Stat. 2681.) 

SUBCHAPTER II—ENERGY-RELATED PROCUREMENT 

Sec. 

2922. Liquid fuels and natural gas: contracts for storage, handling, or distribution. 
1681 § 2922b CH. 173—ENERGY SECURITY 

2922a. Contracts for energy or fuel for military installations. 

2922b. Procurement of energy systems using renewable forms of energy. 

2922c. Procurement of gasohol as motor vehicle fuel. 

2922d. Procurement of fuel derived from coal, oil shale, and tar sands. 

2922e. Acquisition of certain fuel sources: authority to waive contract procedures; 

acquisition by exchange; sales authority. 

2922f. Preference for energy efficient electric equipment. 

2922g. Preference for motor vehicles using electric or hybrid propulsion systems. 

§ 2922. Liquid fuels and natural gas: contracts for storage, 

handling, or distribution 

(a) AUTHORITY TO CONTRACT.—The Secretary of Defense and 

the Secretary of a military department may each contract for storage facilities for, or the storage, handling, or distribution of, liquid 

fuels or natural gas. 

(b) PERIOD OF CONTRACT.—The period of a contract entered 

into under subsection (a) may not exceed 5 years. However, the 

contract may provide options for the Secretary to renew the contract for additional periods of not more than 5 years each, but not 

for more than a total of 20 years. 

(c) OPTION TO PURCHASE FACILITY.—A contract under this section may contain an option for the purchase by the United States 

of the facility covered by the contract at the expiration or termination of the contract, without regard to subsections (a) and (b) of 

section 3324 of title 31, and before approval of title to the underlying land by the Attorney General. 

(Added Pub. L. 85–861, Sec. 1(46), Sept. 2, 1958, 72 Stat. 1457; Sec. 2388, amended Pub. L. 

97–214, Sec. 10(a)(3), July 12, 1982, 96 Stat. 175; Pub. L. 97–258, Sec. 3(b)(6), Sept. 13, 1982, 

96 Stat. 1063; Pub. L. 97–295, Sec. 1(27), Oct. 12, 1982, 96 Stat. 1291; Pub. L. 98–525, title 

XIV, Sec. 1405(56)(A), Oct. 19, 1984, 98 Stat. 2626; Pub. L. 101–510, div. A, title XIII, Sec. 

1322(a)(6), Nov. 5, 1990, 104 Stat. 1671; Pub. L. 103–160, div. A, title VIII, Sec. 825, Nov. 30, 

1993, 107 Stat. 1711; Pub. L. 103–355, title III, Sec. 3064, Oct. 13, 1994, 108 Stat. 3337; renumbered Sec. 2922, Pub. L. 109–364, div. B, title XXVIII, Sec. 2851(b)(2), Oct. 17, 2006, 120 Stat. 

2494.) 

§ 2922a. Contracts for energy or fuel for military installations 

(a) Subject to subsection (b), the Secretary of a military department may enter into contracts for periods of up to 30 years— 

(1) under section 2917 of this title; and 

(2) for the provision and operation of energy production facilities on real property under the Secretary’s jurisdiction or on 

private property and the purchase of energy produced from 

such facilities. 

(b) A contract may be made under subsection (a) only after the 

approval of the proposed contract by the Secretary of Defense. 

(c) The costs of contracts under this section for any year may 

be paid from annual appropriations for that year. 

(Added Pub. L. 97–214, Sec. 6(a)(1), July 12, 1982, 96 Stat. 171, Sec. 2394; amended Pub. L. 

97–321, title VIII, Sec. 805(b)(3), Oct. 15, 1982, 96 Stat. 1573; Pub. L. 100–26, Sec. 7(k)(2), Apr. 

21, 1987, 101 Stat. 284; Pub. L. 101–510, div. A, title XIII, Sec. 1301(12), Nov. 5, 1990, 104 

Stat. 1668; renumbered Sec. 2922a and amended Pub. L. 109–364, div. B, title XXVIII, Sec. 

2851(b)(2), (3)(C), Oct. 17, 2006, 120 Stat. 2494.) 

§ 2922b. Procurement of energy systems using renewable 

forms of energy 

(a) In procuring energy systems the Secretary of a military department shall procure systems that use solar energy or other renewable forms of energy whenever the Secretary determines that 
§ 2922c CH. 173—ENERGY SECURITY 1682 

such procurement is possible, suited to supplying the energy needs 

of the military department under the jurisdiction of the Secretary, 

consistent with the energy performance goals and energy performance plan for the Department of Defense developed under section 

2911 of this title, and supported by the special considerations specified in subsection (c) of such section. 

(b) The Secretary of Defense shall from time to time study uses 

for solar energy and other renewable forms of energy to determine 

what uses of such forms of energy may be reliable in supplying the 

energy needs of the Department of Defense. The Secretary of Defense, based upon the results of such studies, shall from time to 

time issue policy guidelines to be followed by the Secretaries of the 

military departments in carrying out subsection (a) and section 

2857 of this title. 

(Added Pub. L. 97–321, title VIII, Sec. 801(a)(1), Oct. 15, 1982, 96 Stat. 1569, Sec. 2394a; 

amended Pub. L. 98–525, title XIV, Sec. 1405(36), Oct. 19, 1984, 98 Stat. 2624; Pub. L. 101– 

510, div. A, title XIII, Sec. 1322(a)(7), div. B, title XXVIII, Sec. 2852(a), Nov. 5, 1990, 104 Stat. 

1671, 1804; Pub. L. 102–25, title VII, Sec. 701(g)(2), Apr. 6, 1991, 105 Stat. 115; renumbered 

Sec. 2922b and amended Pub. L. 109–364, div. B, title XXVIII, Sec. 2851(b)(2), (3)(D), Oct. 17, 

2006, 120 Stat. 2494, 2495.) 

§ 2922c. Procurement of gasohol as motor vehicle fuel 

(a) OTHER FEDERAL FUEL PROCUREMENTS.—Consistent with 

the vehicle management practices prescribed by the heads of affected departments and agencies of the Federal Government and 

consistent with Executive Order Number 12261, whenever the Secretary of Defense enters into a contract for the procurement of unleaded gasoline that is subject to tax under section 4081 of the Internal Revenue Code of 1986 for motor vehicles of a department or 

agency of the Federal Government other than the Department of 

Defense, the Secretary shall buy alcohol-gasoline blends containing 

at least 10 percent domestically produced alcohol in any case in 

which the price of such fuel is the same as, or lower than, the price 

of unleaded gasoline. 

(b) SOLICITATIONS.—Whenever the Secretary issues a solicitation for bids to procure unleaded gasoline under subsection (a), the 

Secretary shall expressly include in such solicitation a request for 

bids on alcohol-gasoline blends containing at least 10 percent domestically produced alcohol. 

(Added Pub. L. 97–295, Sec. 1(29)(A), Oct. 12, 1982, 96 Stat. 1293, Sec. 2398; amended Pub. 

L. 102–190, div. A, title VIII, Sec. 841(a), Dec. 5, 1991, 105 Stat. 1448; Pub. L. 104–106, div. 

A, title X, Sec. 1061(h), Feb. 10, 1996, 110 Stat. 443; renumbered Sec. 2922c, Pub. L. 109–364, 

div. B, title XXVIII, Sec. 2851(b)(2), Oct. 17, 2006, 120 Stat. 2494.) 

§ 2922d. Procurement of fuel derived from coal, oil shale, 

and tar sands 

(a) USE OF FUEL TO MEET DEPARTMENT OF DEFENSE NEEDS.— 

The Secretary of Defense shall develop a strategy to use fuel produced, in whole or in part, from coal, oil shale, and tar sands (referred to in this section as a ‘‘covered fuel’’) that are extracted by 

either mining or in-situ methods and refined or otherwise processed in the United States in order to assist in meeting the fuel 

requirements of the Department of Defense when the Secretary determines that it is in the national interest. 

(b) AUTHORITY TO PROCURE.—The Secretary of Defense may 

enter into one or more contracts or other agreements (that meet 
1683 § 2922e CH. 173—ENERGY SECURITY 

the requirements of this section) to procure a covered fuel to meet 

one or more fuel requirements of the Department of Defense. 

(c) CLEAN FUEL REQUIREMENTS.—A covered fuel may be procured under subsection (b) only if the covered fuel meets such 

standards for clean fuel produced from domestic sources as the Secretary of Defense shall establish for purposes of this section in consultation with the Department of Energy. 

(d) MULTIYEAR CONTRACT AUTHORITY.—Subject to applicable 

provisions of law, any contract or other agreement for the procurement of covered fuel under subsection (b) may be for one or more 

years at the election of the Secretary of Defense. 

(e) FUEL SOURCE ANALYSIS.—In order to facilitate the procurement by the Department of Defense of covered fuel under subsection (b), the Secretary of Defense may carry out a comprehensive assessment of current and potential locations in the United 

States for the supply of covered fuel to the Department. 

(Added Pub. L. 109–58, title III, Sec. 369(q)(1), Aug. 8, 2005, 119 Stat. 733, Sec. 2398a; renumbered Sec. 2922d, Pub. L. 109–364, div. B, title XXVIII, Sec. 2851(b)(2), Oct. 17, 2006, 120 Stat. 

2494; Pub. L. 111–383, div. A, title X, Sec. 1075(b)(48), Jan. 7, 2011, 124 Stat. 4371.) 

§ 2922e. Acquisition of certain fuel sources: authority to 

waive contract procedures; acquisition by exchange; sales authority 

(a) WAIVER AUTHORITY.—The Secretary of Defense may, for 

any purchase of a defined fuel source, waive the application of any 

provision of law prescribing procedures to be followed in the formation of contracts, prescribing terms and conditions to be included 

in contracts, or regulating the performance of contracts if the Secretary determines— 

(1) that market conditions for the defined fuel source have 

adversely affected (or will in the near future adversely affect) 

the acquisition of that defined fuel source by the Department 

of Defense; and 

(2) the waiver will expedite or facilitate the acquisition of 

that defined fuel source for Government needs. 

(b) SCOPE OF WAIVER.—A waiver under subsection (a) may be 

made with respect to a particular contract or with respect to classes of contracts. Such a waiver that is applicable to a contract for 

the purchase of a defined fuel source may also be made applicable 

to a subcontract under that contract. 

(c) EXCHANGE AUTHORITY.—The Secretary of Defense may acquire a defined fuel source or services related to a defined fuel 

source by exchange of a defined fuel source or services related to 

a defined fuel source. 

(d) AUTHORITY TO SELL.—The Secretary of Defense may sell a 

defined fuel source of the Department of Defense if the Secretary 

determines that the sale would be in the public interest. The proceeds of such a sale shall be credited to appropriations of the Department of Defense for the acquisition of a defined fuel source or 

services related to a defined fuel source. Amounts so credited shall 

be available for obligation for the same period as the appropriations to which the amounts are credited. 

(e) PETROLEUM DEFINED.—In this section, the term ‘‘petroleum’’ means natural or synthetic crude, blends of natural or syn-
§ 2922f CH. 173—ENERGY SECURITY 1684 

thetic crude, and products refined or derived from natural or synthetic crude or from such blends. 

(f) DEFINED FUEL SOURCES.—In this section, the term ‘‘defined 

fuel source’’ means any of the following: 

(1) Petroleum. 

(2) Natural gas. 

(3) Coal. 

(4) Coke. 

(Added Pub. L. 98–525, title XII, Sec. 1234(a), Oct. 19, 1984, 98 Stat. 2604, Sec. 2404; amended 

Pub. L. 100–26, Sec. 7(k)(3), Apr. 21, 1987, 101 Stat. 284; Pub. L. 101–510, div. A, title XIII, 

Sec. 1322(a)(8), Nov. 5, 1990, 104 Stat. 1671; Pub. L. 103–160, div. A, title VIII, Sec. 826, Nov. 

30, 1993, 107 Stat. 1711; Pub. L. 106–65, div. A, title VIII, Sec. 803(a), (b)(1), Oct. 5, 1999, 113 

Stat. 703; renumbered Sec. 2922e, Pub. L. 109–364, div. B, title XXVIII, Sec. 2851(b)(2), Oct. 

17, 2006, 120 Stat. 2494.) 

§ 2922f. Preference for energy efficient electric equipment 

(a) In establishing a new requirement for electric equipment 

referred to in subsection (b) and in procuring electric equipment referred to in that subsection, the Secretary of a military department 

or the head of a Defense Agency, as the case may be, shall provide 

a preference for the procurement of the most energy efficient electric equipment available that meets the requirement or the need 

for the procurement, if providing such a preference is consistent 

with the energy performance goals and energy performance plan 

for the Department of Defense developed under section 2911 of this 

title and supported by the special considerations specified in subsection (c) of such section. 

(b) Subsection (a) applies to the following electric equipment: 

(1) Electric lamps. 

(2) Electric ballasts. 

(3) Electric motors. 

(4) Electric refrigeration equipment. 

(Added Pub. L. 102–484, div. A, title III, Sec. 384(a)(1)(A), Oct. 23, 1992, 106 Stat. 2392, Sec. 

2410c; renumbered Sec. 2922f and amended Pub. L. 109–364, div. B, title XXVIII, Sec. 

2851(b)(2), (3)(E), Oct. 17, 2006, 120 Stat. 2494, 2495.) 

§ 2922g. Preference for motor vehicles using electric or hybrid propulsion systems 

(a) PREFERENCE.—In leasing or procuring motor vehicles for 

use by a military department or Defense Agency, the Secretary of 

the military department or the head of the Defense Agency shall 

provide a preference for the lease or procurement of motor vehicles 

using electric or hybrid propulsion systems, including plug-in hybrid systems, if the electric or hybrid vehicles— 

(1) will meet the requirements or needs of the Department 

of Defense; and 

(2) are commercially available at a cost, including operating cost, reasonably comparable to motor vehicles containing 

only an internal combustion or heat engine using combustible 

fuel. 

(b) EXCEPTION.—Subsection (a) does not apply with respect to 

tactical vehicles designed for use in combat. 

(c) RELATION TO OTHER VEHICLE TECHNOLOGIES THAT REDUCE

CONSUMPTION OF FOSSIL FUELS.—The preference required by subsection (a) does not preclude the Secretary of Defense from authorizing the Secretary of a military department or head of a Defense 
1685 § 2925 CH. 173—ENERGY SECURITY 

1 In subsection (a)(1), ‘‘section 533’’ probably should be ‘‘section 553’’. 

Agency to provide a preference for another vehicle technology that 

reduces the consumption of fossil fuels if the Secretary of Defense 

determines that the technology is consistent with the energy performance goals and plan of the Department required by section 

2911 of this title. 

(d) HYBRID DEFINED.—In this section, the term ‘‘hybrid’’, with 

respect to a motor vehicle, means a motor vehicle that draws propulsion energy from onboard sources of stored energy that are 

both— 

(1) an internal combustion or heat engine using combustible fuel; and 

(2) a rechargeable energy storage system. 

(Added Pub. L. 111–84, div. B, title XXVIII, Sec. 2844(a), Oct. 28, 2009, 123 Stat. 2682.) 

SUBCHAPTER III—GENERAL PROVISIONS 

Sec. 

2925. Annual Department of Defense energy management reports. 

§ 2925. Annual Department of Defense energy management 

reports 

(a) ANNUAL REPORT RELATED TO INSTALLATIONS ENERGY MAN- AGEMENT.—As part of the annual submission of the energy performance goals for the Department of Defense under section 2911 

of this title, the Secretary of Defense shall submit a report containing the following: 

(1) A description of the progress made to achieve the goals 

of the Energy Policy Act of 2005 (Public Law 109–58), section 

2911(e) of this title, section 533 1 of the National Energy Conservation Policy Act (42 U.S.C. 8259b), the Energy Independence and Security Act of 2007 (Public Law 110–140), and the 

energy performance goals for the Department of Defense during the preceding fiscal year. 

(2) A table detailing funding, by account, for all energy 

projects funded through appropriations. 

(3) A table listing all energy projects financed through 

third party financing mechanisms (including energy savings 

performance contracts, enhanced use leases, utility energy 

service contracts, utility privatization agreements, and other 

contractual mechanisms), the duration of each such mechanism, an estimate of the financial obligation incurred through 

the duration of each such mechanism, and the estimated payback period for each such mechanism. 

(4) A description of the actions taken to implement the energy performance master plan in effect under section 2911 of 

this title and carry out this chapter during the preceding fiscal 

year. 

(5) A description of the energy savings realized from such 

actions. 

(6) An estimate of the types and quantities of energy consumed by the Department of Defense and members of the 

armed forces and civilian personnel residing or working on 

military installations during the preceding fiscal year, includ-
§ 2925 CH. 173—ENERGY SECURITY 1686 

2 In subsection (b)(1), ‘‘Director of Operational Energy Plans and Programs’’ should be ‘‘Assistant Secretary of Defense for Operational Energy Plans and Programs’’. 3 In subsection (b)(1), ‘‘section 139b’’ should be ‘‘section 138c’’. 

ing a breakdown of energy consumption by user groups and 

types of energy, energy costs, and the quantities of renewable 

energy produced or procured by the Department. 

(7) A description of the types and amount of financial incentives received under section 2913 of this title during the 

preceding fiscal year and the appropriation account or accounts 

to which the incentives were credited. 

(8) A description and estimate of the progress made by the 

military departments to meet the certification requirements for 

sustainable green-building standards in construction and major 

renovations as required by section 433 of the Energy Independence and Security Act of 2007 (Public Law 110–140; 121 Stat. 

1612). 

(9) A description of steps taken to determine best practices 

for measuring energy consumption in Department of Defense 

facilities and installations, in order to use the data for better 

energy management. 

(10) A description of any other issues and strategies the 

Secretary determines relevant to a comprehensive and renewable energy policy. 

(b) ANNUAL REPORT RELATED TO OPERATIONAL ENERGY.—(1) 

Simultaneous with the annual report required by subsection (a), 

the Secretary of Defense, acting through the Director of Defense 

Operational Energy Plans and Programs 2, shall submit to the congressional defense committees a report on operational energy management and the implementation of the operational energy strategy 

established pursuant to section 139b 3 of this title. 

(2) The annual report under this subsection shall address and 

include the following: 

(A) Statistical information on operational energy demands, 

in terms of expenditures and consumption, for the preceding 

five fiscal years, including funding made available in regular 

defense appropriations Acts and any supplemental appropriation Acts. 

(B) An estimate of operational energy demands for the current fiscal year and next fiscal year, including funding requested to meet operational energy demands in the budget 

submitted to Congress under section 1105 of title 31 and in 

any supplemental requests. 

(C) A description of each initiative related to the operational energy strategy and a summary of funds appropriated 

for each initiative in the previous fiscal year and current fiscal 

year and requested for each initiative for the next five fiscal 

years. 

(D) An evaluation of progress made by the Department of 

Defense— 

(i) in implementing the operational energy strategy, 

including the progress of key initiatives and technology investments related to operational energy demand and management; and 
1687 § 2925 CH. 173—ENERGY SECURITY 

4 In subsection (b)(2)(E), ‘‘Director’’ should be ‘‘Assistant Secretary’’. 

(ii) in meeting the operational energy goals set forth 

in the strategy. 

(E) Such recommendations as the Director 4 considers appropriate for additional changes in organization or authority 

within the Department of Defense to enable further implementation of the energy strategy and such other comments and recommendations as the Director 4 considers appropriate. 

(3) If a report under this subsection is submitted in a classified 

form, the Secretary shall concurrently submit to the congressional 

defense committees an unclassified version of the information required by this subsection. 

(4) In this subsection, the term ‘‘operational energy’’ means the 

energy required for training, moving, and sustaining military forces 

and weapons platforms for military operations. The term includes 

energy used by tactical power systems and generators and weapons 

platforms. 

(Added Pub. L. 109–364, div. B, title XXVIII, Sec. 2851(a)(1), Oct. 17, 2006, 120 Stat. 2493; 

amended Pub. L. 110–417, [div. A], title III, Sec. 331(a), (b)(1), div. B, title XVIII, Sec. 2832, 

Oct. 14, 2008, 122 Stat. 4419, 4420, 4732; Pub. L. 111–84, div. A, title III, Sec. 332(a), Oct. 28, 

2009, 123 Stat. 2257; Pub. L. 111–383, div. B, title XXVIII, Sec. 2832(c)(1), Jan. 7, 2011, 124 

Stat. 4470.)